Case Digest (G.R. No. 96663)
Facts:
In Central Bank of the Philippines and Ramon V. Tiaoqui vs. Court of Appeals and Triumph Savings Bank (G.R. No. 76118, March 30, 1993, 292-A Phil. 669), the Monetary Board issued Resolution No. 596 on May 31, 1985, finding Triumph Savings Bank (TSB) insolvent and placing it under receivership, appointing Ramon V. Tiaoqui as receiver effective June 3, 1985. On June 11, 1985, TSB filed Civil Case No. Q-45139 in the Regional Trial Court (RTC) of Quezon City to annul the resolution for lack of prior notice and hearing and to enjoin its implementation, challenging Section 29 of Republic Act No. 265. The RTC initially issued a temporary restraining order on July 1, 1985, but on July 19, it quashed the TRO and denied injunctive relief. TSB then filed a petition for certiorari (G.R. No. 71465) with the Supreme Court. Meanwhile, the Central Bank and Tiaoqui moved to dismiss TSB’s complaint for failure to state a cause of action and lack of capacity to sue, and TSB filed a motion on SepteCase Digest (G.R. No. 96663)
Facts:
- Antecedent events
- An examination by the Supervision and Examination Sector (SES), Department II, of the Central Bank (CB) found Triumph Savings Bank (TSB) insolvent and at risk of loss to depositors and creditors.
- On May 31, 1985, the Monetary Board (MB) issued Resolution No. 596, ordering the closure of TSB, prohibiting it from doing business, placing it under receivership, and appointing Ramon V. Tiaoqui as receiver (assumed June 3, 1985).
- Proceedings in the Regional Trial Court (RTC)
- On June 11, 1985, TSB filed Civil Case No. Q-45139 in the RTC of Quezon City to annul Resolution No. 596, pray for injunction, and challenge the constitutionality of Sec. 29 of R.A. 265.
- The RTC issued a temporary restraining order (TRO) on July 1, 1985; on July 19, 1985 it granted the CB’s motion to quash the TRO and denied TSB’s injunction.
- TSB filed a petition for certiorari (G.R. No. 71465) on July 25, 1985; the CB and Tiaoqui moved to dismiss the RTC complaint for failure to state a cause of action and lack of capacity to sue.
- RTC orders and Court of Appeals (CA) proceedings
- On September 9, 1985 TSB moved the RTC to restore its private management. On November 11, 1985 the RTC denied the CB’s motion to dismiss and ordered Tiaoqui to restore management to TSB’s elected board under CB comptrollership.
- The CB and Tiaoqui elevated these orders to the CA by certiorari; on September 26, 1986 the CA affirmed the RTC in toto, allowing judicial review of arbitrariness and bad faith and recognizing TSB’s capacity to sue.
- On October 15, 1986 the CB and Tiaoqui filed a Rule 45 petition before the Supreme Court seeking to set aside the CA decision and dismiss Civil Case No. Q-45139.
Issues:
- Absence of prior notice and hearing
- Does the lack of prior notice and hearing to TSB render MB Resolution No. 596 arbitrary and in bad faith under Sec. 29 of R.A. 265?
- Does administrative due process require prior hearing before the MB may close a bank and appoint a receiver?
- Capacity to sue
- Who has legal capacity to file an action to annul an MB resolution placing a bank under receivership—only the receiver or also the bank’s officers/stockholders?
- What is the effect of Executive Order 289’s amendment to Sec. 29 on who may institute such suits?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)