THE SUPREME COURT (SC) approved new rules on the liquidation of closed banks which will take effect on April 16.
Under A.M. No. 19-12-02-SC dated Feb. 18, the Supreme Court approved the proposed rules of the Philippine Deposit Insurance Corp. (PDIC), as reviewed by the Sub-committee on Commercial Courts, to assign as liquidation courts the regional trial courts designated as special commercial courts (SCC).
All pending petition for assistance in the liquidation (PAL) of closed banks that have not been given due course by regular courts will be transferred to SCCs.
“Other PALs which have been given due course shall continue to be heard by the courts where they are pending, but shall be governed by these Rules, unless the LC orders otherwise to prevent manifest injustice to the parties involved,” the resolution read.
Under the rules, the receiver, who will take over and liquidate the bank, will file a petition with the court within 180 days from the publication of the notice of the bank’s closure.
If the PAL is insufficient in form, the court shall order the receiver to comply with the requirements within 10 days from the receipt of the petition.
If the petition is sufficient, the court will issue an order setting for initial hearing in 60 days and direct claimants whose claims were denied by the receiver to file their claims with the court within 20 days from the date of publication of the order or 60 days from the receipt of notice of denial or disallowance of the claim, whichever is issued later.
The receiver will present proof of compliance with publication requirements and submit a formal offer of evidence before the court, submitting the petition for resolution. The court, within 10 days, shall issue an order giving due course to the petition.
The court, meanwhile, may dismiss a dispute claim on any applicable grounds under the Rules of Court or hold a pre-trial and trial before rendering a decision.
After the court gives due course to the petition, the receiver should file a liquidation report on the closed bank not later than the end of the third quarter of the succeeding year or as may be required by the court.
The partial or final asset distribution plan (ADP) of a closed bank for its creditors may be filed anytime after the submission of the liquidation report and the motion for approval for the final ADP will be filed within five years from the date of the closure but maybe extended to seven years based on compelling grounds.
A hearing will be set within 90 days from the receipt of the ADP and creditors will have to file their comments within 10 days.
The resolution approving the partial or final ADP must be published in a newspaper within five days and its finality will take effect after 30 days or after denial of motion for reconsideration. The receiver will implement the ADP.
“No temporary restraining order may be issued by any court, except the Court of Appeals when the matter is of extreme urgency, against the implementation of the Partial or Final ADP,” it said.
A final report on the implementation of the final ADP will be submitted by the receiver to the Monetary Board and Securities and Exchange Commission after expiration of winding-up period under the charter of the PDIC and submit a copy to the court.
The resolution also states the rule directing the receiver to file a motion for approval of plan within five years from closure should apply prospectively to banks which will close after the effectivity of the rules while for banks closed prior to this, receivers are given seven years from the effectivity of the rules to file a motion for approval of a final ADP. — V.M.M. Villegas