G.R. No. L-63277 - Vda. de Borromeo vs. Pogoy

Respondent Philippine Veterans Bank (PVB) established pension and salary loan products for bona fide veterans, surviving spouses, teachers, and low-salaried employees under Republic Acts Nos. 3518 and 7169.
To secure loans lacking real estate collateral, PVB charged borrowers a premium called the Credit Redemption Fund (CRF), credited to special trust funds to pay outstanding obligations upon borrower’s death.

On April 30, 2002, the BSP Supervision and Examination Department II found the CRF scheme to be a form of insurance, thus violating Section 54 of Republic Act No. 8791 (General Banking Law of 2000), which prohibits banks from engaging in the insurance business.
BSP notified PVB on March 17, 2003 of the Insurance Commission’s opinion and directed discontinuance of CRF; PVB complied on February 24, 2004.
On September 16, 2005, Monetary Board Resolution No. 1139 ordered PVB to return P144,713,224.54 in CRF balances to borrowers and preserve borrower records; PVB’s request for reconsideration was denied on December 5, 2006.

PVB filed a petition for declaratory relief in the Regional Trial Court (RTC) of Makati (Civil Case No. 07-271) to nullify MB Resolution No. 1139.
RTC issued an Order on September 24, 2007 dismissing the petition as improper (holding that an ordinary civil action, not declaratory relief, was the proper remedy) and served the order on October 17, 2007.
On October 15, 2008, PVB moved for reconsideration, alleging late receipt of the dismissal order; despite BSP’s certification of timely service, the RTC granted reconsideration, required BSP’s answer, and proceeded.
In a Decision dated June 15, 2009, the RTC granted declaratory relief, declared the CRF non-insurance and Sec. 54-compliant, and nullified MB Resolution No. 1139. BSP’s motion for reconsideration was denied on August 25, 2009.

Petitioners (the Monetary Board, Gail U. Fule, and BSP) filed a Petition for Review on Certiorari under Rule 45 to reverse the RTC Decision and Order.
They argued that (a) declaratory relief is not the proper remedy to challenge a final quasi-judicial resolution; (b) the RTC’s initial dismissal order was final and executory; and (c) PVB indeed violated Sec. 54 by engaging in insurance business.

Whether a petition for declaratory relief under Rule 63 can be used to challenge a BSP Monetary Board resolution issued in its quasi-judicial capacity.
Whether MB Resolution No. 1139 is a proper subject of declaratory relief.

Whether the RTC Order of September 24, 2007 dismissing PVB’s petition became final and executory despite PVB’s belated motion for reconsideration.
Whether PVB’s motion for reconsideration filed nearly one year later was properly entertained.