G.R. No. 217938 - Philippine Veterans Bank vs. Bank of Commerce

Philippine Veterans Bank (PVB) and College Assurance Plan Philippines, Inc. (CAP) initiated consolidated petitions for review under Rule 45 of the Rules of Court against Bank of Commerce (BOC).
The dispute arose from orders issued in the rehabilitation proceedings of CAP, which involved redemption of preferred shares and the subsequent payment of accrued interest/dividends.

In 1991, CAP executed a trust agreement with Trust Service Group of Boston Bank of the Philippines, later renamed as BOC.
Under this trust agreement, CAP, through BOC, subscribed to Series A and Series B preferred shares of BOC.

On August 26, 2005, CAP filed a petition for rehabilitation before the Regional Trial Court (RTC) of Makati City.
Mamerto A. Marcelo, Jr. was designated as the Rehabilitation Receiver, and PVB was appointed as the new trustee bank for CAP.

On April 22, 2008, BOC redeemed CAP’s preferred shares, with the consent and prior approval of the Bangko Sentral ng Pilipinas (BSP).
On April 24, 2008, the Rehabilitation Court issued an Order directing BOC to remit the accrued interest on the redeemed shares to PVB, with strict deadlines and conditions concerning trustee fees and the accrual of additional interest if delayed.

BOC filed a Motion for Partial Reconsideration, arguing that declaration of dividends required BSP approval pursuant to BSP Circular No. 241, Series of 2000.
On May 29, 2008, the Rehabilitation Court acknowledged BOC’s motion and sought BSP’s advice regarding the payment of interest.
The BSP, in its letter dated September 9, 2008, explained that reporting of dividend declarations was required for verification and that payment should proceed if no adverse advice was received within 30 banking days.
Later, on November 14, 2011, the BSP sent a denial letter citing BOC’s negative surplus and unsafe banking practices, thereby denying its dividend declaration application.

Complying with the Rehabilitation Court’s Order, BOC’s Board of Directors, on December 16, 2008, established a new Sinking Fund for the payment of dividends.
On May 14, 2010, PVB and BOC entered into a Settlement Agreement, followed by an Escrow Agreement whereby BOC deposited funds (notably P113,000,000.00) into an escrow account intended for the payment of accrued dividends.

On May 9, 2012, Marcelo and PVB filed a Motion for Execution of the Order directing payment of the accrued interest.
The Rehabilitation Court, on May 9, 2013, issued an Order directing that funds equivalent to the interest due to CAP be removed from the Escrow Account and credited to CAP’s trust account.
PVB subsequently complied by transferring an amount of approximately P90,703,943.92 from the Escrow Account to CAP’s Trust Fund, later disbursed to CAP’s plan holders.

BOC filed a Petition for Review before the CA contending that the Rehabilitation Court’s Order was flawed in light of the BSP letter and violations of banking laws and regulations.
CAP and PVB argued that the 2008 Orders had acquired finality and were executory.
On September 30, 2014, the CA ruled in favor of BOC by setting aside the May 9, 2013 Order and directing CAP to return the funds credited to its trust account.
Subsequent motions for reconsideration filed by PVB and CAP were denied in the CA Resolution dated April 16, 2015.

PVB contended that the finality and immutability of the 2008 and 2008-reiterated Orders should preclude any backdoor attempt to annul their effect by relying on a supervening BSP letter.
CAP argued that the directive for payment had become final and irreparable, and the release of funds to plan holders rendered any reversal unjust and detrimental to innocent beneficiaries.
BOC maintained that the BSP’s denial letter (dated November 14, 2011) and evidence of negative surplus justified the nullification of the executed judgment, asserting that its compliance was conditioned on securing BSP approval.

Whether the CA erred in reversing the Rehabilitation Court’s Order dated May 9, 2013 directing the segregation and release of funds for payment of accrued dividends/interest to CAP.
Whether the BSP’s subsequent denial letter (dated November 14, 2011) qualifies as a supervening event sufficient to nullify a final and executory court order.
Whether the doctrine of immutability of final judgments has been improperly disregarded by allowing a change in the executed judgment based on alleged post-judgment events.
Whether the alleged financial deficiencies of BOC and compliance with regulatory requirements under the General Banking Law and the Manual of Regulations for Banks (MORB) can justify altering a final judgment without showing compelling, competent evidence.