Case Summary (G.R. No. 202761)
Background of the Agreement
During the years 2003 to 2007, Standard Chartered Bank entered into a Group Facilities Agreement with LBHI, allowing it to extend financial assistance to LBHI and its affiliates, including PI Two. In securing the financial obligations, LBHI executed a Pledge Agreement involving various debt instruments as collateral.
Bankruptcy and Rehabilitation Proceedings
LBHI filed for bankruptcy in the United States on September 15, 2008, prompting Standard Chartered Bank to intervene as a creditor. Shortly after, on September 18, 2008, Metrobank initiated rehabilitation proceedings for PI Two in the Regional Trial Court of Makati City, where Standard Chartered also appeared as a creditor.
Rehabilitation Plan Approval
The Regional Trial Court approved a Rehabilitation Plan on December 14, 2009, identifying Metrobank and Standard Chartered Bank as recognized claimants. A Management Committee was formed to oversee PI Two's operations during rehabilitation.
MRM's Intervention and Court Orders
Petitioner MRM acquired an indirect interest in PI Two but allegedly did so without the knowledge of parties involved in the rehabilitation. Metrobank filed a manifestation motion to prohibit MRM from interfering in PI Two’s affairs, which the court granted, effectively barring MRM’s participation in management or board affairs.
Issues Surrounding Collaterals
Disputes arose regarding the collaterals provided by LBHI to Standard Chartered Bank. PI Two accused Standard Chartered of concealing the status and possession of its collaterals, raising concerns of potential double recovery.
Court Decisions
The Rehabilitation Court partially granted PI Two's motion for disclosure of collateral details and later denied MRM's requests to oust Standard Chartered from the Management Committee based on citizenship grounds. However, MRM later succeeded in having Standard Chartered removed from the Management Committee and ordered to release certain pledged collaterals.
Court of Appeals Ruling
Standard Chartered Bank appealed the Rehabilitation Court's orders, resulting in a Court of Appeals decision on July 17, 2012, which nullified the Rehabilitation Court's orders regarding the surrender of the collaterals and Standard Chartered's removal from the Management Committee. It reinstated Standard Chartered to its previous status in the Management Committee.
Subsequent Developments
While the appeal was pending, further developments included the dissolution of the Management Committee and new proceedings in the U.S. Bankruptcy Court, where Standard Chartered settled claims and agreed on a payment plan. This led to the Rehabilitation Receiver concluding that Standard Chartered had lost its standing in the rehabilitation process.
Final Resolutions and App
...continue readingCase Syllabus (G.R. No. 202761)
Case Background
- The case revolves around a Petition for Review on Certiorari filed by MRM Asset Holdings 2, Inc. against Standard Chartered Bank (SCB).
- The petition challenges the Decision of the Court of Appeals dated July 17, 2012, which nullified the Resolution issued by the Regional Trial Court of Makati City acting as a Rehabilitation Court on September 26, 2011.
- The case is significant due to its implications in corporate rehabilitation and the rights of creditors.
Facts of the Case
- Between 2003 and 2007, SCB and Lehman Brothers Holdings, Inc. (LBHI) entered into a Group Facilities Agreement, allowing financial facilities to LBHI and its affiliates.
- Philippine Investment Two (SPV-AMC), Inc. (PI Two), a foreign affiliate of LBHI, obtained loans from SCB Philippines amounting to P819,000,000.00, secured by a Pledge Agreement executed by LBHI on September 12, 2008.
- On September 15, 2008, LBHI filed for bankruptcy in New York, prompting SCB to intervene as a creditor.
- On September 18, 2008, Metrobank filed a petition for corporate rehabilitation of PI Two, with SCB also intervening as a creditor in the proceedings.
Rehabilitation Proceedings
- A Rehabilitation Plan was approved by the Rehabilitation Court on December 14, 2009, which recognized both Metrobank and SCB as claimants.
- A Management Committee (ManCom) was formed, consisting of representatives from PI Two, Metrobank, and SCB, to oversee corporate operations during rehabilitation.
- MRM acquired an indirect equity interest in PI Two, prompting Metrobank to file a motion to proh