Case Digest (G.R. No. 206150)
Facts:
Land Bank of the Philippines v. Fastech Synergy Philippines, Inc., G.R. No. 206150, August 09, 2017, Supreme Court Second Division, Leonen, J., writing for the Court.Petitioner Land Bank of the Philippines sought review of the Court of Appeals' September 28, 2012 Decision and March 5, 2013 Resolution that set aside the December 9, 2011 Resolution of the Regional Trial Court (Rehabilitation Court), Makati City, and approved the joint corporate rehabilitation plan of respondents collectively called the Fastech Corporations (Fastech Synergy, Fastech Microassembly & Test, Fastech Electronique, and Fastech Properties). The Fastech Corporations had filed a Joint Petition for corporate rehabilitation under the Financial Rehabilitation and Insolvency Act (RA 10142) on April 8, 2011, alleging common management, assets and creditors and submitting a Rehabilitation Plan proposing a two‑year grace period, waivers of accumulated interest and penalties, and extended repayment terms.
The Rehabilitation Court issued a Commencement Order with Stay on April 19, 2011 and appointed Atty. Rosario Bernaldo as Rehabilitation Receiver. Creditors, including Planters Development Bank (later succeeded by Philippine Asset Growth Two, Inc. (PAGTI)), Penta Capital, UnionBank, BPI and Landbank filed notices of claim and comments; the Fastech Corporations submitted a revised Rehabilitation Plan after the Rehabilitation Court's June 22, 2011 order. The Rehabilitation Receiver recommended that the plan was viable, but external auditors issued qualified opinions or were unable to render opinions on several years' financial statements. Citing unreliable financial statements, lack of disclosed assumptions and failure to establish feasibility, the Rehabilitation Court dismissed the petition in its December 9, 2011 Resolution under the standards of RA 10142.
The Fastech Corporations appealed to the Court of Appeals (CA-G.R. SP No. 122836) by a Petition for Review under Rule 43; the Court of Appeals issued interim injunctive relief and on September 28, 2012 granted the petition, reversed the Rehabilitation Court, approved the Rehabilitation Plan, reinstated the joint petition, enjoined Planters Bank from foreclosing, and remanded supervision to the trial court. The CA denied motions for reconsideration on March 5, 2013. Planters Bank (and successor PAGTI) filed a separate Petition for Review before the Supreme Court (G.R. No. 206528), and Landbank filed the present Petition for Review on Certiorari under Rule 45, challenging the CA decision and asking the Court to consider creditor concerns about the plan's terms and viability.
While this Rule 45 petition was pending, respondents reported partial compliance with the approved plan (quarterly payments totaling some Php35.48 million) and filed updates and the Receiver's compliance report. Meanwhile, in G.R. No. 206528 this Court, in a June 28, 2016 Decision, reversed the Court of Appeals and dismissed the Fastech Corporations' joint rehabilitation petition after a comprehensive review found the Rehabilitation Plan lacked required material financial commitments and a ...(Pro-only)
Issues:
- Is Landbank’s Petition for Review under Rule 45 moot and academic such that the Supreme Court should decline to decide it?
- (Subsidiary/substantive) Did the Court of Appeals err in reinstating and approving the Fastech Corporations’ Reha...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)