bank of commerce vs planters developmet - g.r. nos. 154470-71. september 24, 2012

8/20/2019 Bank of Commerce vs Planters Developmet - G.R. Nos. 154470-71. September 24, 2012

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SECOND DIVISION

[G.R. Nos. 154470-71. September 24, 2012.]

BANK OF COMMERCE, petitioner, vs. PLANTERS DEVELOPMENT BANK and BANGKO SENTRALNG PLPNAS, respondents.

!G.R. Nos. "#$#%&'&(. Septe)*er +$, +("+.

BANGKO SENTRAL NG PLPNAS, petitioner, vs. PLANTERS DEVELOPMENT BANK, respondent.

DECSON

BRON, - p

Be/ore t0e Co1rt are t2o 3onso4idated petitions /or revie2 on 3ertiorari 1nder R14e $#, " onp1re 51estions o/ 4a2, 64ed *7 t0e petitioners Ban8 o/ Co))er3e 9BOC: and t0e Ban;8oSentra4 n; Pi4ipinas 9BSP:. T0e7 assai4 t0e -an1ar7 "(, +((+ and -147 +


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+BB M ($#


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On -1ne


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Petition, additiona447 i)p4eadin; t0e BOC and A44 Asia.


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t0ereon d147 ee31ted *7 t0e re;istered o2ner or 0is d147 a1t0oried representative . . . andd147 re3orded on t0e *oo8s o/ t0e Centra4 Ban8.= DTEA

T0e a44e;ed assi;n)ent o/ s1*e3t CB Bi44s in PDB@s /avor is not re3orded>re;istered in BSP@s*oo8s. $( 91nders3orin; s1pp4ied:

Conse51ent47, 20en N151i and t0e BSP re/1sed t0e PDB@s re51est 9to re3ord its 34ai):, t0e72ere )ere47 per/or)in; t0eir d1ties in a33ordan3e 2it0 CB Cir314ar No. +%.

A4ternative47, t0e BSP as8ed t0at an interp4eader s1it *e a44o2ed *et2een and a)on; t0e34ai)ants to t0e s1*e3t CB *i44s on t0e position t0at 20i4e it is a*4e and 2i44in; to pa7 t0es1*e3t CB *i44s@ /a3e va41e, it is d1t7 *o1nd to ens1re t0at pa7)ent is )ade to t0e ri;0t/14o2ner. T0e BSP pra7ed t0at 1d;)ent *e rendered

a. Orderin; t0e dis)issa4 o/ t0e !PDB@s petition /or 4a38 o/ )erit? D3CAa

*. Deter)inin; 20i30 *et2een>a)on; !PDB and t0e ot0er 34ai)ants is>are 4a2/1447entit4ed to t0e o2ners0ip o/ t0e s1*e3t CB *i44s and t0e pro3eeds t0ereo/?

3. . . .?

d. Orderin; PDB to pa7 BSP and N151i s130 a3t1a4>3o)pensator7 and ee)p4ar7da)a;es . . . as !t0e RTC )a7 dee) 2arranted? and

e. Orderin; PDB to pa7 N151i )ora4 da)a;es . . . and to pa7 t0e 3osts o/ t0e s1it. $"

S1*se51ent events

T0e PDB a;reed 2it0 t0e BSP@s a4ternative response /or an interp4eader T3DS

$. PDB a;rees t0at t0e vario1s 34ai)ants s0o14d no2 interp4ead and s1*stantiate t0eirrespe3tive 34ai)s on t0e s1*e3t CB *i44s. o2ever, t0e tota4 /a3e va41e o/ t0e s1*e3t CB

*i44s s0o14d *e deposited in es3ro2 2it0 a private *an8 to *e disposed o/ on47 1pon order !o/t0e RTC. $+

A33ordin;47, on -1ne &, "& $< and A1;1st $, "&, $$ t0e BOC and t0e PDB entered intot2o separate Es3ro2 A;ree)ents. $# T0e 6rst a;ree)ent 3overed t0e 6rst set o/ CB *i44s,20i4e t0e se3ond a;ree)ent 3overed t0e se3ond set o/ CB *i44s. T0e parties a;reed to oint473o44e3t /ro) t0e BSP t0e )at1rit7 pro3eeds o/ t0ese CB *i44s and to deposit said a)o1nt ines3ro2, =pendin; 6na4 deter)ination *7 Co1rt 1d;)ent, or a)i3a*4e sett4e)ent as to 20os0a44 *e event1a447 entit4ed t0ereto.= $ T0e BOC and t0e PDB 64ed a -oint Motion, $s1*)ittin; t0ese Es3ro2 A;ree)ents /or 3o1rt approva4. T0e RTC ;ave its approva4 to t0eparties@ -oint Motion. $% A33ordin;47, t0e BSP re4eased t0e )at1rit7 pro3eeds o/ t0e CB *i44s*7 3reditin; t0e De)and Deposit A33o1nt o/ t0e PDB and o/ t0e BOC 2it0 #( ea30 o/ t0e)at1rit7 pro3eeds o/ t0e a)o1nt in es3ro2. $&

n vie2 o/ t0e BOC@s a351isition o/ a44 t0e CB *i44s, A44 Asia #( )oved to *e dropped as arespondent 92it0 t0e PDB@s 3on/or)it7:, #" 20i30 t0e RTC ;ranted. #+ T0e RCBCs1*se51ent47 /o44o2ed s1it. #<

n 4i;0t o/ t0e deve4op)ents, on Ma7 $, "&&%, t0e RTC re51ired t0e parties to )ani/est t0eirintention re;ardin; t0e 3ase and to in/or) t0e 3o1rt o/ an7 a)i3a*4e sett4e)ent? =ot0er2ise,t0!e 3ase s0a44 *e dis)issed /or 4a38 o/ interest.= #$ Co)p47in; 2it0 t0e RTC@s order, t0eBOC )oved 9i: t0at t0e 3ase *e set /or pre'tria4 and 9ii: /or /1rt0er pro3eedin; to reso4ve t0e


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re)ainin; iss1es *et2een t0e BOC and t0e PDB, parti314ar47 on =20o 0as a *etter ri;0t overt0e s1*e3t CB *i44s.= ## T0e PDB oined t0e BOC in its )otion. #

On Septe)*er +%, +(((, t0e RTC ;ranted t0e BSP@s )otion to interp4ead and, a33ordin;47,re51ired t0e BOC to a)end its Ans2er and /or t0e 3oni3tin; 34ai)ants to 3o))ent t0ereon.# n O3to*er +(((, t0e BOC 64ed its A)ended Conso4idated Ans2er 2it0 Co)p14sor7Co1nter34ai), reiteratin; its ear4ier ar;1)ents assertin; o2ners0ip over t0e s1*e3t CB *i44s.#%

n t0e a4ternative, t0e BOC added t0at even ass1)in; t0at t0ere 2as no ee3tive trans/er o/t0e nine CB *i44s 14ti)ate47 to t0e BOC, t0e PDB re)ains o*4i;ated to de4iver to t0e BOC, as*17er in t0e Apri4 "# transa3tion and 14ti)ate s133essor'in'interest o/ t0e *17er 9Ban3ap: int0e Apri4 "& transa3tion, eit0er t0e ori;ina4 s1*e3ts o/ t0e sa4es or t0e va41e t0ereo/, p41s20atever in3o)e t0at )a7 0ave *een earned d1rin; t0e penden37 o/ t0e 3ase. #&

T0at BOC pra7ed TaCDS

". To de34are BOC as t0e ri;0t/14 o2ner o/ t0e nine 9&: CB *i44s and as t0e part7 entit4edto t0e pro3eeds t0ereo/ as 2e44 as a44 in3o)e earned p1rs1ant to t0e t2o 9+: Es3ro2A;ree)ents entered into *7 BOC and PDB. AEaS

+. n t0e a4ternative, orderin; PDB to de4iver t0e ori;ina4 s1*e3t o/ t0e sa4estransa3tions or t0e va41e t0ereo/ and 20atever in3o)e earned *7 2a7 o/ interest atprevai4in; rate. D3TaE

Iit0o1t an7 opposition or o*e3tion /ro) t0e PDB, on Fe*r1ar7 +


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and t0e 2ord =o2ner= 0ere re/ers to t0e re;istered o2ner ;ivin; noti3e o/ t0e /ra1d to t0eBSP. T0e PDB, 0o2ever, is not t0e re;istered o2ner nor is it in possession 90o4der: o/ t0e CB*i44s. Conse51ent47, t0e PDB@s 3ase 3an on47 /a44s 1nder t0e t0ird sit1ation 20i30 4eavest0e RTC, as a 3o1rt o/ ;enera4 1risdi3tion, 2it0 t0e a1t0orit7 to reso4ve t0e iss1e o/o2ners0ip o/ a re;istered *ond 9t0e CB *i44s: not /a44in; in eit0er o/ t0e 6rst t2o sit1ations.A3DE

T0e BOC asserts t0at t0e po4i37 3onsideration s1pportive o/ its interpretation o/ CB Cir314arNo. +% is to 0ave a re4ia*4e s7ste) to prote3t t0e re;istered o2ner? s0o14d 0e 64e a noti3e2it0 t0e BSP a*o1t a /ra1d14ent assi;n)ent o/ 3ertain CB *i44s, t0e BSP si)p47 0as to 4oo8 atits *oo8s to deter)ine 20o is t0e o2ner o/ t0e CB *i44s /ra1d14ent47 assi;ned. Sin3e it is on47t0e re;istered o2ner 20o 3o)p4ied 2it0 t0e BSP@s re51ire)ent o/ re3ordin; an assi;n)entin t0e BSP@s *oo8s, t0en =t0e prote3tive )ant4e o/ ad)inistrative pro3eedin;s= s0o14dne3essari47 *ene6t 0i) on47, 2it0o1t etendin; t0e sa)e *ene6t to t0ose 20o 30ose toi;nore t0e Cir314ar@s re51ire)ent, 4i8e t0e PDB. %

Ass1)in; ar;1endo t0at t0e PDB@s 3ase /a44s 1nder t0e se3ond sit1ation i.e., t0e BSP 0as 1risdi3tion to reso4ve t0e iss1e o/ o2ners0ip o/ t0e CB *i44s t0e )ore re3ent CB Cir314arNo. &'%( 9R14es and Re;14ations Governin; Centra4 Ban8 Certi63ates o/ nde*tedness:a4read7 s1perseded CB Cir314ar No. +%, and, in parti314ar, ee3tive47 a)ended Se3tion "( 9d:

$ o/ CB Cir314ar No. +%. T0e pertinent provisions o/ CB Cir314ar No. &'%( read S3AT

Assi;n)ent Ae3ted *7 Fra1d. An7 assi;n)ent /or trans/er o/ o2ners0ip o/ re;istered3erti63ate o*tained t0ro1;0 /ra1d14ent representation i/ 0onored *7 t0e Centra4 Ban8 or an7o/ its a1t0oried servi3e a;en3ies s0a44 not )a8e t0e Centra4 Ban8 or a;en37 4ia*4e t0ere/ore1n4ess it 0as previo1s /or)a4 noti3e o/ t0e /ra1d. T0e Centra4 Ban8, 1pon noti3e 1nder oat0t0at t0e assi;n)ent 2as se31red t0ro1;0 /ra1d14ent )eans, s0a44 i))ediate47 iss1e and3ir314arie a =stop order= a;ainst t0e trans/er, e30an;e, rede)ption o/ t0e Certi63atein341din; t0e pa7)ent o/ interest 3o1pons. T0e Centra4 Ban8 or servi3e a;en37 3on3erneds0a44 3ontin1e to 2it00o4d a3tion on t0e 3erti63ate 1nti4 s130 ti)e t0at t0e 3oni3tin; 34ai)s0ave *een 6na447 sett4ed eit0er *7 a)i3a*4e sett4e)ent *et2een t0e parties or *7 order o/t0e Co1rt.

Qn4i8e CB Cir314ar No. +%, CB Cir314ar No. &'%( 4i)ited t0e BSP@s a1t0orit7 to t0e )ereiss1an3e and 3ir314ariation o/ a =stop order= a;ainst t0e trans/er, e30an;e and rede)ption1pon s2orn noti3e o/ a /ra1d14ent assi;n)ent. Qnder t0is Cir314ar, t0e BSP s0a44 on473ontin1e to 2it00o4d a3tion 1nti4 t0e disp1te is ended *7 an a)i3a*4e sett4e)ent or *7

1di3ia4 deter)ination. Given t0e )ore passive stan3e o/ t0e BSP t0e ver7 a;en37 tas8edto en/or3e t0e 3ir314ars invo4ved 1nder CB Cir314ar No. &'%(, t0e RTC@s dis)issa4 o/ t0eBOC@s 3o1nter34ai)s is pa4pa*47 erroneo1s. DEaTS

Last47, sin3e N151i@s oJ3e 9Govern)ent Se31rities Depart)ent: 0ad a4read7 *een a*o4is0ed,& it 3an no 4on;er ad1di3ate t0e disp1te 1nder t0e se3ond sit1ation 3overed *7 CB Cir314arNo. +%. T0e a*o4ition o/ N151i@s oJ3e is not on47 3onsistent 2it0 t0e BSP@s C0arter *1t, )orei)portant47, 2it0 CB Cir314ar No. &'%(, 20i30 re)oved t0e BSP@s ad1di3ative a1t0orit7over /ra1d14ent assi;n)ents.

TE PDB@S COMMENT

T0e PDB 34ai)s t0at 1risdi3tion is deter)ined *7 t0e a44e;ations in t0e 3o)p4aint>petitionand not *7 t0e de/enses set 1p in t0e ans2er. ( n 64in; t0e petition 2it0 t0e RTC, t0e PDB)ere47 see8s to 3o)pe4 t0e BSP to deter)ine, p1rs1ant to CB Cir314ar No. +%, t0e part74e;a447 entit4ed to t0e pro3eeds o/ t0e s1*e3t CB *i44s, 20i30, as t0e PDB a44e;ed, 0ave *eentrans/erred t0ro1;0 /ra1d14ent representations an a44e;ation 20i30 proper47 re3o;niedt0e BSP@s 1risdi3tion to reso4ve 3oni3tin; 34ai)s o/ o2ners0ip over t0e CB *i44s. CT3A


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T0e PDB adds t0at 1nder t0e do3trine o/ pri)ar7 1risdi3tion, 3o1rts s0o14d re/rain /ro)deter)inin; a 3ontrovers7 invo4vin; a 51estion 20ose reso41tion de)ands t0e eer3ise o/so1nd ad)inistrative dis3retion. n t0e present 3ase, t0e BSP@s spe3ia4 8no24ed;e andeperien3e in reso4vin; disp1tes on se31rities, 20ose assi;n)ent and tradin; are ;overned*7 t0e BSP@s r14es, s0o14d *e 1p0e4d.

T0e PDB 3o1nters t0at t0e BOC@s tri'/o4d interpretation o/ Se3tion "( 9d: $ o/ CB Cir314ar No.+% san3tions sp4it 1risdi3tion 20i30 is not /avored? *1t even t0is tri'/o4d interpretation 20i30,in t0e se3ond sit1ation, 4i)its t0e )eanin; o/ t0e =o2ner= to t0e re;istered o2ner is a2ed.Se3tion "( 9d: $ ai)s to prote3t not 1st t0e re;istered o2ner *1t an7one 20o 0as *eendeprived o/ 0is *ond *7 /ra1d14ent representation in order to deter /ra1d in t0e se3ondar7tradin; o/ ;overn)ent se31rities.

T0e PDB asserts t0at t0e eisten3e o/ CB Cir314ar No. &'%( or t0e a*o4ition o/ N151i@soJ3e does not res14t in deprivin; t0e BSP o/ its 1risdi3tion 6rst, CB Cir314ar No. &'%(epress47 provides t0at CB Cir314ar No. +% s0a44 0ave s1pp4etor7 app4i3ation to CB Cir314arNo. &'%(? and se3ond, t0e BSP 3an a42a7s desi;nate an oJ3e to reso4ve t0e PDB@s 34ai)over t0e CB *i44s. TaAEC

Last47, t0e PDB ar;1es t0at even ass1)in; t0at t0e RTC 0as 1risdi3tion to reso4ve t0e iss1e

o/ o2ners0ip o/ t0e CB *i44s, t0e RTC 0as not a351ired 1risdi3tion over t0e BOC@s so'3a44ed=3o)p14sor7= 3o1nter34ai)s 920i30 in tr1t0 is )ere47 =per)issive=: *e3a1se o/ t0e BOC@s/ai41re to pa7 t0e appropriate do38et /ees. T0ese 3o1nter34ai)s s0o14d, t0ere/ore, *edis)issed and ep1n;ed /ro) t0e re3ord.

TE COQRT@S RQLNG

Ie ;rant t0e petitions.

At t0e o1tset, 2e note t0at t0e parties 0ave not raised t0e va4idit7 o/ eit0er CB Cir314ar No.+% or CB Cir314ar No. &'%( as an iss1e. I0at t0e parties 4ar;e47 3ontest is t0e app4i3a*4e3ir314ar in 3ase o/ an a44e;ed47 /ra1d14ent47 assi;ned CB *i44. T0e app4i3a*4e 3ir314ar, in t1rn,is deter)inative o/ t0e proper re)ed7 avai4a*4e to t0e PDB and>or t0e BOC as 34ai)ants tot0e pro3eeds o/ t0e s1*e3t CB *i44s. AE3TCD

ndisp1ta*47, at t0e ti)e t0e PDB s1pposed47 invo8ed t0e 1risdi3tion o/ t0e BSP in "&&$ 9*7re51estin; /or t0e annotation o/ its 34ai) over t0e s1*e3t CB *i44s in t0e BSP@s *oo8s:, CBCir314ar No. &'%( 0as 4on; *een in ee3t. T0ere/ore, t0e parties@ respe3tive interpretationso/ t0e provision o/ Se3tion "( 9d: $ o/ CB Cir314ar No. +% do not 0ave an7 si;ni63an3e 1n4essit is 6rst esta*4is0ed t0at t0at Cir314ar ;overns t0e reso41tion o/ t0eir 3oni3tin; 34ai)s o/o2ners0ip. T0is 3on341sion is i)portant, ;iven t0e s1pposed repea4 or )odi63ation o/Se3tion "( 9d: $ o/ CB Cir314ar No. +% *7 t0e /o44o2in; provisions o/ CB Cir314ar No. &'%(

ARTCLE

SQPPLEMENTAL RQLES

Se3tion ". Centra4 Ban8 Cir314ar No. +%. T0e provisions o/ Centra4 Ban8 Cir314ar No. +%s0a44 0ave s1pp4etor7 app4i3ation to )atters not spe3ia447 3overed *7 t0ese R14es. SaCDT

ARTCLE

EFFECTVT

Ee3tivit7 T0e r14es and re;14ations 0erein pres3ri*ed s0a44 ta8e ee3t 1pon approva4 *7t0e Monetar7 Board, Centra4 Ban8 o/ t0e P0i4ippines, and a44 3ir314ars, )e)oranda, or oJ3eorders in3onsistent 0ere2it0 are revo8ed or )odi6ed a33ordin;47. 9E)p0ases added:


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Ie a;ree 2it0 t0e PDB t0at in vie2 o/ CB Cir314ar No. +%@s s1pp4etor7 app4i3ation, anatte)pt to 0ar)onie t0e apparent47 3oni3tin; provisions is a prere51isite *e/ore one )a7possi*47 3on341de t0at an a)end)ent or a repea4 eists. " nterestin;47, 0o2ever, even t0ePDB itse4/ /ai4ed to s1*)it an interpretation *ased on its o2n position o/ 0ar)oniation.

T0e repea4in; 34a1se o/ CB Cir314ar No. &'%( o*vio1s47 did not epress47 repea4 CB Cir314arNo. +%? in /a3t, it even provided /or t0e s1pp4etor7 app4i3ation o/ CB Cir314ar No. +% on=)atters not spe3ia447 3overed *7= CB Cir314ar No. &'%(. I0i4e no epress repea4 eists,t0e intent o/ CB Cir314ar No. &'%( to operate as an i)p4ied repea4, + or at 4east to a)endear4ier CB 3ir314ars, is s1pported *7 its tet =revo8!in;= or =)odi/!7in;= =a44 3ir314ars=20i30 are in3onsistent 2it0 its ter)s. E3DAT

At t0e o1tset, 2e stress t0at none o/ t0e parties disp1tes t0at t0e s1*e3t CB *i44s /a44 2it0int0e 3ate;or7 o/ a 3erti63ate or eviden3e o/ inde*tedness and t0at t0ese 2ere iss1ed *7 t0eCentra4 Ban8, no2 t0e BSP. T01s, even 2it0o1t resortin; to stat1tor7 3onstr13tion aids,)atters invo4vin; t0e s1*e3t CB *i44s s0o14d ne3essari47 *e ;overned *7 CB Cir314ar No.&'%(. Even ;rantin;, 0o2ever, t0at re4ian3e on CB Cir314ar No. &'%( a4one is noteno1;0, 2e 6nd t0at CB Cir314ar No. &'%( i)p4ied47 repea4s CB Cir314ar No. +%.

An i)p4ied repea4 transpires 20en a s1*stantia4 3oni3t eists *et2een t0e ne2 and t0eprior 4a2s. n t0e a*sen3e o/ an epress repea4, a s1*se51ent 4a2 3annot *e 3onstr1ed asrepea4in; a prior 4a2 1n4ess an irre3on3i4a*4e in3onsisten37 and rep1;nan37 eist in t0eter)s o/ t0e ne2 and t0e o4d 4a2s. < Repea4 *7 i)p4i3ation is not /avored, 1n4ess )ani/est47intended *7 t0e 4e;is4at1re, or 1n4ess it is 3onvin3in;47 and 1na)*i;1o1s47 de)onstrated,t0at t0e 4a2s or orders are 34ear47 rep1;nant and patent47 in3onsistent 2it0 one anot0er sot0at t0e7 3annot 3o'eist? t0e 4e;is4at1re is pres1)ed to 8no2 t0e eistin; 4a2 and 2o14depress a repea4 i/ one is intended. $ prLL

T0ere are t2o instan3es o/ i)p4ied repea4. One ta8es p4a3e 20en t0e provisions in t0e t2oa3ts on t0e sa)e s1*e3t )atter are irre3on3i4a*47 3ontradi3tor7, in 20i30 3ase, t0e 4ater a3t,to t0e etent o/ t0e 3oni3t, 3onstit1tes an i)p4ied repea4 o/ t0e ear4ier one. T0e ot0er

o331rs 20en t0e 4ater a3t 3overs t0e 20o4e s1*e3t o/ t0e ear4ier one and is 34ear47 intendedas a s1*stit1te? t01s, it 2i44 operate to repea4 t0e ear4ier 4a2. #

A ;enera4 readin; o/ t0e t2o 3ir314ars s0o2s t0at t0e se3ond instan3e o/ i)p4ied repea4 ispresent in t0is 3ase. CB Cir314ar No. +%, entit4ed =Re;14ations Governin; Open Mar8etOperations, Sta*i4iation o/ Se31rities Mar8et, ss1e, Servi3in; and Rede)ption o/ P1*4i3De*t,= is a re;14ation ;overnin; t0e servi3in; and rede)ption o/ p1*4i3 de*t, in341din; t0eiss1e, ins3ription, re;istration, trans/er, pa7)ent and rep4a3e)ent o/ *onds and se31ritiesrepresentin; t0e p1*4i3 de*t. On t0e ot0er 0and, CB Cir314ar No. &'%(, entit4ed =R14esand Re;14ations Governin; Centra4 Ban8 Certi63ate o/ nde*tedness,= is t0e ;overnin;re;14ation on )atters 9i: invo4vin; 3erti63ate o/ inde*tedness % iss1ed *7 t0e Centra4Ban8 itse4/ and 9ii: 20i30 are si)i4ar47 3overed *7 CB Cir314ar No. +%. 3TaCS

T0e CB Monetar7 Board iss1ed CB Cir314ar No. +% to re;14ate t0e servi3in; and rede)ption

o/ p1*4i3 de*t, p1rs1ant to Se3tion "+$ 9no2 Se3tion ""& o/ Rep1*4i3 A3t !R.A. No. #


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Centra4 Ban8'iss1ed eviden3e o/ inde*tedness. Qnder Se3tion ", Arti34e o/ CB Cir314ar No.&'%(, t0e 3ontin1ed re4evan3e and app4i3ation o/ CB Cir314ar No. +% 2o14d depend on t0eneed to s1pp4e)ent an7 de63ien37 or si4en3e in CB Cir314ar No. &'%( on a parti314ar)atter. DES3aT

n t0e present 3ase, *ot0 CB Cir314ar No. +% and CB Cir314ar No. &'%( provide t0e BSP 2it0a 3o1rse o/ a3tion in 3ase o/ an a44e;ed47 /ra1d14ent47 assi;ned 3erti63ate o/ inde*tedness.Qnder CB Cir314ar No. +%, in 3ase o/ /ra1d14ent assi;n)ents, t0e BSP 2o14d 0ave to =3a441pon t0e o2ner and t0e person presentin; t0e *ond to s1*stantiate t0eir respe3tive 34ai)s=and, /ro) t0ere, deter)ine 20o 0as a *etter ri;0t over t0e re;istered *ond. On t0e ot0er0and, 1nder CB Cir314ar No. &'%(, t0e BSP s0a44 )ere47 =iss1e and 3ir314arie a @stop order@a;ainst t0e trans/er, e30an;e, rede)ption o/ t0e !re;istered 3erti63ate= 2it0o1t an7ad1di3ative /1n3tion 920i30 is t0e pre3ise root o/ t0e present 3ontrovers7:. As t0e t2o3ir314ars stand, t0e patent irre3on3i4a*i4it7 o/ t0ese t2o provisions does not re51iree4a*oration. Se3tion #, Arti34e V o/ CB Cir314ar No. &'%( ines3apa*47 repea4ed Se3tion "(9d: $ o/ CB Cir314ar No. +%.

T0e iss1e o/ BSP@s 1risdi3tion,

4a7 0idden 3SaCDT

On t0at note, t0e Co1rt 3o14d 0ave 2ritten 6nis to t0e present 3ontrovers7 *7 si)p47s1stainin; t0e BSP@s 0ands'o approa30 to t0e PDB@s pro*4e) 1nder CB Cir314ar No. &'%(.o2ever, t0e 1risdi3tiona4 provision o/ CB Cir314ar No. &'%( itse4/, in re4ation to CBCir314ar No. +%, on t0e )atter o/ /ra1d14ent assi;n)ent, 0as ;iven rise to a 51estion o/

1risdi3tion t0e 3ore 51estion o/ 4a2 invo4ved in t0ese petitions 20i30 t0e Co1rt 3annot 1st treat s1*'si4en3io.

Broad47 spea8in;, 1risdi3tion is t0e 4e;a4 po2er or a1t0orit7 to 0ear and deter)ine a 3a1se.%( n t0e eer3ise o/ 1di3ia4 or 51asi'1di3ia4 po2er, it re/ers to t0e a1t0orit7 o/ a 3o1rt to0ear and de3ide a 3ase. %" n t0e 3ontet o/ t0ese petitions, 2e 0ar8 *a38 to t0e *asi3prin3ip4es ;overnin; t0e 51estion o/ 1risdi3tion over t0e s1*e3t )atter.

First, 1risdi3tion over t0e s1*e3t )atter is deter)ined on47 *7 t0e Constit1tion and *7 4a2.%+ As a )atter o/ s1*stantive 4a2, pro3ed1ra4 r14es a4one 3an 3on/er no 1risdi3tion to 3o1rtsor ad)inistrative a;en3ies. %< n /a3t, an ad)inistrative a;en37, a3tin; in its 51asi'1di3ia43apa3it7, is a tri*1na4 o/ 4i)ited 1risdi3tion and, as s130, 3o14d 2ie4d on47 s130 po2ers t0atare spe3i63a447 ;ranted to it *7 t0e ena*4in; stat1tes. n 3ontrast, an RTC is a 3o1rt o/;enera4 1risdi3tion, i.e., it 0as 1risdi3tion over 3ases 20ose s1*e3t )atter does not /a442it0in t0e e341sive ori;ina4 1risdi3tion o/ an7 3o1rt, tri*1na4 or *od7 eer3isin; 1di3ia4 or51asi'1di3ia4 /1n3tions. %$

Se3ond, 1risdi3tion over t0e s1*e3t )atter is deter)ined not *7 t0e p4eas set 1p *7 t0ede/endant in 0is ans2er %# *1t *7 t0e a44e;ations in t0e 3o)p4aint, % irrespe3tive o/20et0er t0e p4ainti is entit4ed to /avora*4e 1d;)ent on t0e *asis o/ 0is assertions. % T0ereason is t0at t0e 3o)p4aint is s1pposed to 3ontain a 3on3ise state)ent o/ t0e 14ti)ate /a3ts3onstit1tin; t0e p4ainti@s 3a1ses o/ a3tion. %%

T0ird, 1risdi3tion is deter)ined *7 t0e 4a2 in /or3e at t0e ti)e o/ t0e 64in; o/ t0e 3o)p4aint.%&

Parent0eti3a447, t0e Co1rt o*serves t0at none o/ t0e parties ever raised t0e iss1e o/ 20et0ert0e BSP 3an si)p47 diso2n its 1risdi3tion, ass1)in; it 0as, *7 t0e si)p4e epedient o/pro)14;atin; a ne2 3ir314ar 9spe3ia447 app4i3a*4e to a 3erti63ate o/ inde*tedness iss1ed *7t0e BSP itse4/:, in3onsistent 2it0 an o4d 3ir314ar, assertive o/ its 4i)ited 1risdi3tion over


11/22

o2ners0ip iss1es arisin; /ro) /ra1d14ent assi;n)ents o/ a 3erti63ate o/ inde*tedness. T0ePDB, in parti314ar, re4ied so4e47 and 0eavi47 on CB Cir314ar No. +%. TAE3SC

n 4i;0t o/ t0e a*ove prin3ip4es pointin; to 1risdi3tion as a )atter o/ s1*stantive 4a2, t0eprovisions o/ t0e 4a2 itse4/ t0at ;ave CB Cir314ar &'%( its 4i/e and 1risdi3tion )1st *eea)ined. SaEAD

T0e P0i4ippine Centra4 Ban8

On -an1ar7


12/22

distin3tive 30ara3ter o/ t0e operations o/ instit1tions and t0e s1*stantive si)i4arities o/spe3i63 /1n3tions to 20i30 s130 r14es, )odes or standards are to *e app4ied? CS3aD

$.+. T0e 3ond13t o/ ea)ination to deter)ine 3o)p4ian3e 2it0 4a2s and re;14ations i/ t0e3ir31)stan3es so 2arrant as deter)ined *7 t0e Monetar7 Board?

$.irre;14arities /o1nd *7 or dis3overed *7 an a1dits0a44 *e i))ediate47 addressed?

$.#. n51irin; into t0e so4ven37 and 4i51idit7 o/ t0e instit1tion 9+'D:? or

$.. En/or3in; pro)pt 3orre3tive a3tion. 9n: CDa3E

T0e Ban;8o Sentra4 s0a44 a4so 0ave s1pervision over t0e operations o/ and eer3isere;14ator7 po2ers over 51asi'*an8s, tr1st entities and ot0er 6nan3ia4 instit1tions 20i301nder spe3ia4 4a2s are s1*e3t to Ban;8o Sentra4 s1pervision. 9+'Ca:

For t0e p1rposes o/ t0is A3t, =51asi'*an8s= s0a44 re/er to entities en;a;ed in t0e *orro2in; o/ /1nds t0ro1;0 t0e iss1an3e, endorse)ent or assi;n)ent 2it0 re3o1rse or a33eptan3e o/deposit s1*stit1tes as de6ned in Se3tion o/ Rep1*4i3 A3t No. #< 90erea/ter t0e =Ne2Centra4 Ban8 A3t=: /or p1rposes o/ re4endin; or p1r30asin; o/ re3eiva*4es and ot0ero*4i;ations. !e)p0asis o1rs

I0i4e t0is provision e)po2ers t0e BSP to oversee t0e operations and a3tivities o/ *an8s to=as3ertain t0at 4a2s and re;14ations are 3o)p4ied 2it0,= t0e eisten3e o/ t0e BSP@s

1risdi3tion in t0e present disp1te 3annot re47 on t0is provision. T0e /a3t re)ains t0at t0eBSP a4read7 )ade 8no2n to t0e PDB its 1n/avora*4e position on t0e 4atter@s 34ai) o//ra1d14ent assi;n)ent d1e to t0e 4atter@s o2n /ai41re to 3o)p47 & 2it0 eistin; re;14ationsaTAE3

n t0is 3onne3tion, Se3tion "( 9*: + a4so re51ires t0at a =Deta30ed assi;n)ent 2i44 *ere3o;nied or a33epted on47 1pon previo1s noti3e to t0e Centra4 Ban8 . . . .= n /a3t, in a)e)o dated Septe)*er +


13/22

9e: . . .

Non'3o)p4ian3e 0ere2it0 2i44 3onstit1te a *asis /or non'a3tion or 2it00o4din; o/ a3tion onrede)ption>pa7)ent o/ interest 3o1pons>trans/er transa3tions or deno)inationa4 e30an;et0at )a7 *e dire3t47 ae3ted t0ere*7. !Bo4d/a3in; s1pp4ied aCT3D

A;ain, t0e *oo8s o/ t0e BSP do not s0o2 t0at t0e s1pposed assi;n)ent o/ s1*e3t CB Bi44s

2as ever re3orded in t0e BSP@s *oo8s. !Bo4d/a3in; s1pp4ied

o2ever, t0e PDB /a14ts t0e BSP /or not re3ordin; t0e assi;n)ent o/ t0e CB *i44s in t0e PDB@s/avor despite t0e /a3t t0at t0e PDB a4read7 re51ested t0e BSP to re3ord its assi;n)ent in t0eBSP@s *oo8s as ear47 as -1ne


14/22

o*e7 t0e s1*poena 2it0o1t 1sti6a*4e reason, to ad)inister oat0s and 3o)pe4 presentationo/ *oo8s, re3ords and ot0ers, needed in its ea)ination, to i)pose 6nes and ot0er san3tionsand to iss1e 3ease and desist order. Se3tion


15/22

T0e Monetar7 Board s0a44 deter)ine t0e interest rates, )at1rities and ot0er 30ara3teristi3so/ said o*4i;ations o/ t0e Ban;8o Sentra4, and )a7, i/ it dee)s it advisa*4e, deno)inate t0eo*4i;ations in ;o4d or /orei;n 31rren3ies. ASDTEa

S1*e3t to t0e prin3ip4es stated in Se3tion &( o/ t0is A3t, t0e eviden3es o/ inde*tedness o/t0e Ban;8o Sentra4 to 20i30 t0is se3tion re/ers )a7 *e a351ired *7 t0e Ban;8o Sentra4*e/ore t0eir )at1rit7, eit0er t0ro1;0 p1r30ases in t0e open )ar8et or t0ro1;0 rede)ptionsat par and *7 4ot i/ t0e Ban;8o Sentra4 0as reserved t0e ri;0t to )a8e s130 rede)ptions. T0eeviden3es o/ inde*tedness a351ired or redee)ed *7 t0e Ban;8o Sentra4 s0a44 not *ein341ded a)on; its assets, and s0a44 *e i))ediate47 retired and 3an3e44ed. "(% 9ita4i3ss1pp4ied? e)p0ases o1rs:

T0e pri)ar7 o*e3tive o/ t0e BSP is to )aintain pri3e sta*i4it7. "(& T0e BSP 0as a n1)*er o/)onetar7 po4i37 instr1)ents at its disposa4 to pro)ote pri3e sta*i4it7. To in3rease or red13e4i51idit7 in t0e 6nan3ia4 s7ste), t0e BSP 1ses open )ar8et operations, a)on; ot0ers. ""(Open )ar8et operation is a )onetar7 too4 20ere t0e BSP p1*4i347 *17s or se44s ;overn)entse31rities """ /ro) 9or to: *an8s and 6nan3ia4 instit1tions in order to epand or 3ontra3t t0es1pp47 o/ )one7. B7 3ontro44in; t0e )one7 s1pp47, t0e BSP is a*4e to eert so)e in1en3eon t0e pri3es o/ ;oods and servi3es and a30ieve its ination o*e3tives. ""+

On3e t0e iss1e and>or sa4e o/ a se31rit7 is )ade, t0e BSP 2o14d ne3essari47 )a8e adeter)ination, in a33ordan3e 2it0 its o2n r14es, o/ t0e entit7 entit4ed to re3eive t0epro3eeds o/ t0e se31rit7 1pon its )at1rit7. T0is deter)ination *7 t0e BSP is an eer3ise o/ itsad)inistrative po2ers ""< 1nder t0e 4a2 as an in3ident to its po2er to pres3ri*e r14es andre;14ations ;overnin; open )ar8et operations to a30ieve t0e =pri)ar7 o*e3tive o/ a30ievin;pri3e sta*i4it7.= ""$ As a )atter o/ ne3essit7, too, t0e sa)e r14es and re;14ations /a3i4itatetransa3tion 2it0 t0e BSP *7 providin; /or an order47 )anner o/, a)on; ot0ers, iss1in;,trans/errin;, e30an;in; and pa7in; se31rities representin; p1*4i3 de*t. TEAaDC

Si;ni63ant47, 20en 3o)petin; 34ai)s o/ o2ners0ip over t0e pro3eeds o/ t0e se31rities it 0asiss1ed are *ro1;0t *e/ore it, t0e 4a2 0as not ;iven t0e BSP t0e 51asi'1di3ia4 po2er toreso4ve t0ese 3o)petin; 34ai)s as part o/ its po2er to en;a;e in open )ar8et operations.Not0in; in t0e BSP@s 30arter 3on/ers on t0e BSP t0e 1risdi3tion or a1t0orit7 to deter)ine t0is

8ind o/ 34ai)s, arisin; o1t o/ a s1*se51ent trans/er or assi;n)ent o/ eviden3e o/inde*tedness a )atter t0at appropriate47 /a44s 2it0in t0e 3o)peten3e o/ 3o1rts o/ ;enera4 1risdi3tion. T0at t0e stat1te 2it00o4ds t0is po2er /ro) t0e BSP is on47 3onsistent 2it0 t0e/1nda)enta4 reasons /or t0e 3reation o/ a P0i4ippine 3entra4 *an8, t0at is, to 4a7 do2n sta*4e)onetar7 po4i37 and eer3ise *an8 s1pervisor7 /1n3tions. T01s, t0e BSP@s ass1)ption o/

1risdi3tion over 3o)petin; 34ai)s 3annot 6nd even a stret30ed'o1t 1sti63ation 1nder its3orporate po2ers =to do and per/or) an7 and a44 t0in;s t0at )a7 *e ne3essar7 or proper to3arr7 o1t t0e p1rposes= o/ R.A. No. #


16/22

0ere raised as an iss1e: t0at points to t0e BSP@s 4i)ited ro4e in 3ase o/ an a44e;ed47/ra1d14ent assi;n)ent to si)p47 9i: iss1in; and 3ir314ariin; a =@stop order= a;ainst t0etrans/er, e30an;e, rede)ption o/ t0e 3erti63ate o/ inde*tedness, in341din; t0e pa7)ent o/interest 3o1pons, and 9ii: 2it00o4din; a3tion on t0e 3erti63ate. 3ATS

A si)i4ar 3on341sion 3an *e dra2n /ro) t0e BSP@s ad)inistrative ad1di3ator7 po2er in 3aseso/ =2i44/14 /ai41re or re/1sa4 to 3o)p47 2it0, or vio4ation o/, an7 *an8in; 4a2 or an7 order,instr13tion or re;14ation iss1ed *7 t0e Monetar7 Board, or an7 order, instr13tion or r14in; *7t0e Governor.= ""% T0e non'3o)p4ian3e 2it0 t0e pertinent re51ire)ents 1nder CB Cir314arNo. +%, as a)ended, deprives a part7 /ro) an7 ri;0t to de)and pa7)ent /ro) t0e BSP.

n ot0er 2ords, t0e ;rant o/ 51asi'1di3ia4 a1t0orit7 to t0e BSP 3annot possi*47 etend tosit1ations 20i30 do not 3a44 /or t0e eer3ise *7 t0e BSP o/ its s1pervisor7 or re;14ator7/1n3tions over entities 2it0in its 1risdi3tion. ""& T0e /a3t a4one t0at t0e parties invo4ved are*an8in; instit1tions does not ne3essari47 3a44 /or t0e eer3ise *7 t0e BSP o/ its 51asi'1di3ia4po2ers 1nder t0e 4a2. "+(

T0e do3trine o/ pri)ar7 1risdi3tion

ar;1es a;ainst BSP@s p1rported

a1t0orit7 to ad1di3ate o2ners0ip

iss1es over t0e disp1ted CB *i44s CDA3T

Given t0e pre3edin; dis31ssions, even t0e PDB@s invo3ation o/ t0e do3trine o/ pri)ar7 1risdi3tion is )isp4a3ed.

n t0e eer3ise o/ its p4enar7 4e;is4ative po2er, Con;ress )a7 3reate ad)inistrative a;en3iesendo2ed 2it0 51asi'4e;is4ative and 51asi'1di3ia4 po2ers. Ne3essari47, Con;ress 4i8e2isede6nes t0e 4i)its o/ an a;en37@s 1risdi3tion in t0e sa)e )anner as it de6nes t0e 1risdi3tiono/ 3o1rts. "+" As a res14t, it )a7 0appen t0at eit0er a 3o1rt or an ad)inistrative a;en37 0ase341sive 1risdi3tion over a spe3i63 )atter or *ot0 0ave 3on31rrent 1risdi3tion on t0esa)e. t )a7 0appen, too, t0at 3o1rts and a;en3ies )a7 2i44in;47 re4in51is0 ad1di3ator7

po2er t0at is ri;0t/1447 t0eirs in /avor o/ t0e ot0er. One o/ t0e instan3es 20en a 3o1rt )a7proper47 de/er to t0e ad1di3ator7 a1t0orit7 o/ an a;en37 is t0e app4i3a*i4it7 o/ t0e do3trineo/ pri)ar7 1risdi3tion. "++

As ear47 as "$, t0e Co1rt app4ied t0e do3trine o/ pri)ar7 1risdi3tion 1nder t0e /o44o2in;ter)s 3SDa

. n t0e 6/ties, t0e Co1rt ta8in; 3o;nian3e o/ t0e )ove to vest 1risdi3tion inad)inistrative 3o))issions and *oards t0e po2er to reso4ve spe3ia4ied disp1tes . . . r14edt0at Con;ress in re51irin; t0e nd1stria4 Co1rt@s intervention in t0e reso41tion o/ 4a*or')ana;e)ent 3ontroversies . . . )eant s130 1risdi3tion to *e e341sive, a4t0o1;0 it did notso epress47 state in t0e 4a2. T0e Co1rt 0e4d t0at 1nder t0e =sense')a8in; and epeditio1sdo3trine o/ pri)ar7 1risdi3tion . . . t0e 3o1rts 3annot or 2i44 not deter)ine a 3ontrovers7

invo4vin; a 51estion 20i30 is 2it0in t0e 1risdi3tion o/ an ad)inistrative tri*1na4, 20ere t0e51estion de)ands t0e eer3ise o/ so1nd ad)inistrative dis3retion re51irin; t0e spe3ia48no24ed;e, eperien3e, and servi3es o/ t0e ad)inistrative tri*1na4 to deter)ine te30ni3a4and intri3ate )atters o/ /a3t, and a 1ni/or)it7 o/ r14in; is essentia4 to 3o)p47 2it0 t0ep1rposes o/ t0e re;14ator7 stat1te ad)inistered.= "+< 9e)p0asis o1rs:

n nd1stria4 Enterprises, n3. v. Co1rt o/ Appea4s, "+$ t0e Co1rt r14ed t0at 20i4e an a3tion /orres3ission o/ a 3ontra3t *et2een 3oa4 deve4opers appears to *e an a3tion 3o;nia*4e *7re;14ar 3o1rts, t0e tria4 3o1rt re)ains to *e 2it0o1t 1risdi3tion to entertain t0e s1it sin3et0e 3ontra3t so1;0t to *e res3inded is =inetri3a*47 tied 1p 2it0 t0e ri;0t to deve4op 3oa4'


17/22

*earin; 4ands and t0e deter)ination o/ 20et0er or not t0e reversion o/ t0e 3oa4 operatin;3ontra3t over t0e s1*e3t 3oa4 *4o38s to !t0e p4ainti 2o14d *e in 4ine 2it0 t0e !3o1ntr7@snationa4 pro;ra) and o*e3tive on 3oa4'deve4op)ent and over'a44 3oa4's1pp47'de)and*a4an3e.= t t0en app4ied t0e do3trine o/ pri)ar7 1risdi3tion 3ETCA

n re3ent 7ears, it 0as *een t0e 1rispr1dentia4 trend to app47 t0e do3trine o/ pri)ar7 1risdi3tion in )an7 3ases invo4vin; )atters t0at de)and t0e spe3ia4 3o)peten3e o/ad)inistrative a;en3ies. t )a7 o331r t0at t0e Co1rt 0as 1risdi3tion to ta8e 3o;nian3e o/ aparti314ar 3ase, 20i30 )eans t0at t0e )atter invo4ved is a4so 1di3ia4 in 30ara3ter. o2ever,i/ t0e 3ase is s130 t0at its deter)ination re51ires t0e epertise, spe3ia4ied s8i44s and8no24ed;e o/ t0e proper ad)inistrative *odies *e3a1se te30ni3a4 )atters or intri3ate51estions o/ /a3ts are invo4ved, t0en re4ie/ )1st 6rst *e o*tained in an ad)inistrativepro3eedin; *e/ore a re)ed7 2i44 *e s1pp4ied *7 t0e 3o1rts even t0o1;0 t0e )atter is 2it0int0e proper 1risdi3tion o/ a 3o1rt. T0is is t0e do3trine o/ pri)ar7 1risdi3tion. t app4ies =20erea 34ai) is ori;ina447 3o;nia*4e in t0e 3o1rts, and 3o)es into p4a7 20enever en/or3e)ent o/t0e 34ai) re51ires t0e reso41tion o/ iss1es 20i30, 1nder a re;14ator7 s30e)e, 0ave *eenp4a3ed 2it0in t0e spe3ia4 3o)peten3e o/ an ad)inistrative *od7!.= aAE3D

C4ear47, t0e do3trine o/ pri)ar7 1risdi3tion 6nds app4i3ation in t0is 3ase sin3e t0e 51estiono/ 20at 3oa4 areas s0o14d *e ep4oited and deve4oped and 20i30 entit7 s0o14d *e ;ranted

3oa4 operatin; 3ontra3ts over said areas invo4ves a te30ni3a4 deter)ination *7 t0e !B1rea1o/ Ener;7 Deve4op)ent as t0e ad)inistrative a;en37 in possession o/ t0e spe3ia4iedepertise to a3t on t0e )atter. T0e Tria4 Co1rt does not 0ave t0e 3o)peten3e to de3ide)atters 3on3ernin; a3tivities re4ative to t0e ep4oration, ep4oitation, deve4op)ent andetra3tion o/ )inera4 reso1r3es 4i8e 3oa4. T0ese iss1es pre341de an initia4 1di3ia4deter)ination. !e)p0ases o1rs

T0e a*sen3e o/ an7 epress or i)p4ied stat1tor7 po2er to ad1di3ate 3oni3tin; 34ai)s o/o2ners0ip or entit4e)ent to t0e pro3eeds o/ its 3erti63ates o/ inde*tedness 6nds3o)p4e)ent in t0e si)i4ar a*sen3e o/ an7 te30ni3a4 )atter t0at 2o14d 3a44 /or t0e BSP@sspe3ia4 epertise or 3o)peten3e. "+# n /a3t, 20at t0e PDB@s petitions *ear o1t is essentia447t0e nat1re o/ t0e transa3tion it 0ad 2it0 t0e s1*se51ent trans/erees o/ t0e s1*e3t CB *i44s9BOC and Ban3ap: and not an7 )atter )ore appropriate /or spe3ia4 deter)ination *7 t0e

BSP or an7 ad)inistrative a;en37. CTaSA

n a si)i4ar vein, it is 2e44'sett4ed t0at t0e interpretation ;iven to a r14e or re;14ation *7t0ose 30ar;ed 2it0 its ee31tion is entit4ed to t0e ;reatest 2ei;0t *7 t0e 3o1rts 3onstr1in;s130 r14e or re;14ation. "+ I0i4e t0ere are e3eptions "+ to t0is r14e, t0e PDB 0as not3onvin3ed 1s t0at a depart1re is 2arranted in t0is 3ase. Given t0e non'app4i3a*i4it7 o/ t0edo3trine o/ pri)ar7 1risdi3tion, t0e BSP@s o2n position, in 4i;0t o/ Cir314ar No. &'%(,deserves respe3t /ro) t0e Co1rt.

Ordinari47, 3ases invo4vin; t0e app4i3ation o/ do3trine o/ pri)ar7 1risdi3tion are initiated *7an a3tion invo8in; t0e 1risdi3tion o/ a 3o1rt or ad)inistrative a;en37 to reso4ve t0es1*stantive 4e;a4 3oni3t *et2een t0e parties. n t0is sense, t0e present 3ase is 51ite 1ni51esin3e t0e 3o1rt@s 1risdi3tion 2as, ori;ina447, invo8ed to 3o)pe4 an ad)inistrative a;en379t0e BSP: to reso4ve t0e 4e;a4 3oni3t o/ o2ners0ip over t0e CB *i44s instead o/ o*tainin; a

1di3ia4 deter)ination o/ t0e sa)e disp1te. SCaDAE

T0e re)ed7 o/ interp4eader

Based on t0e 1ni51e /a3t1a4 pre)ise o/ t0e present 3ase, t0e RTC a3ted 3orre3t47 in initia447ass1)in; 1risdi3tion over t0e PDB@s petition /or )anda)1s, pro0i*ition and in1n3tion. "+%I0i4e t0e RTC a;reed 9a4*eit erroneo1s47: 2it0 t0e PDB@s vie2 9t0at t0e BSP 0as 1risdi3tion:,it, 0o2ever, dis)issed not on47 t0e BOC@s>t0e BSP@s 3o1nter34ai)s *1t t0e PDB@s petitionitse4/ as 2e44, on t0e ;ro1nd t0at it 4a38s 1risdi3tion.


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T0is is p4ain error.

Not on47 t0e parties t0e)se4ves, *1t )ore so t0e 3o1rts, are *o1nd *7 t0e r14e on non'2aiver o/ 1risdi3tion. "+& Even ind14;in; t0e RTC, i/ it *e4ieves t0at 1risdi3tion over t0eBOC@s 3o1nter34ai)s and t0e BSP@s 3o1nter34ai)>3ross34ai) /or interp4eader 3a44s /or t0eapp4i3ation o/ t0e do3trine o/ pri)ar7 1risdi3tion, t0e a44o2an3e o/ t0e PDB@s petition even*e3o)es i)perative *e3a1se 3o1rts )a7 raise t0e iss1e o/ pri)ar7 1risdi3tion s1a sponte."3ross34ai) /or interp4eader. Se3tion ", R14e + o/ t0e R14es o/ Co1rtprovides 20en an interp4eader is proper 3DCT

SECTON ". I0en interp4eader proper. I0enever 3oni3tin; 34ai)s 1pon t0e sa)e s1*e3t)atter are or )a7 *e )ade a;ainst a person 20o 34ai)s no interest 20atever in t0e s1*e3t)atter, or an interest 20i30 in 20o4e or in part is not disp1ted *7 t0e 34ai)ants, 0e )a7*rin; an a3tion a;ainst t0e 3oni3tin; 34ai)ants to 3o)pe4 t0e) to interp4ead and 4iti;atet0eir severa4 34ai)s a)on; t0e)se4ves.

T0e re)ed7 o/ an a3tion o/ interp4eader "


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n ;rantin; t0e BSP@s )otion, t0e RTC a3ted on t0e 3orre3t pre)ise t0at it 0as 1risdi3tion toreso4ve t0e parties@ 3oni3tin; 34ai)s over t0e CB *i44s 3onsistent 2it0 t0e r14es and t0eparties@ 3ond13t and a33ordin;47 re51ired t0e BOC to a)end its ans2er and /or t0e PDB to3o))ent t0ereon. S1dden47, 0o2ever, t0e PDB )ade an a*o1t'/a3e and 51estioned t0e

1risdi3tion o/ t0e RTC. S2a7ed *7 t0e PDB@s ar;1)ent, t0e RTC dis)issed even t0e PDB@spetition 20i30 )eans t0at it did not a3t1a447 3o)pe4 t0e BSP to reso4ve t0e BOC@s and t0e

PDB@s 34ai)s.Iit0o1t t0e )otion to interp4ead and t0e order ;rantin; it, t0e RTC 3o14d on47 dis)iss t0ePDB@s petition sin3e it is t0e RTC 20i30 0as 1risdi3tion to reso4ve t0e parties@ 3oni3tin;34ai)s not t0e BSP. Given t0at t0e )otion to interp4ead 0as *een a3t1a447 64ed, t0e RTC3o14d not 0ave rea447 ;ranted t0e re4ie/ ori;ina447 so1;0t in t0e PDB@s petition sin3e t0e RTC@sorder ;rantin; t0e BSP@s )otion to interp4ead to 20i30 t0e PDB in /a3t a351ies3ed into ee3tive47 res14ted in t0e dis)issa4 o/ t0e PDB@s petition. T0is is not a4tered *7 t0e /a3t t0att0e PDB additiona447 pra7ed in its petition /or da)a;es, attorne7@s /ees and 3osts o/ s1it=a;ainst t0e p1*4i3 respondents= *e3a1se t0e ;rant o/ t0e order to interp4ead ee3tive47s1stained t0e propriet7 o/ t0e BSP@s resort to t0is pro3ed1ra4 devi3e. aAS3D

nterp4eader

". as a spe3ia4 3ivi4 a3tion

I0at is 51ite 1ni51e in t0is 3ase is t0at t0e BSP did not initiate t0e interp4eader s1it t0ro1;0an ori;ina4 3o)p4aint *1t t0ro1;0 its Ans2er. T0is 3ir31)stan3e *e3o)es 1nderstanda*4e i/it is 3onsidered t0at inso/ar as t0e BSP is 3on3erned, t0e PDB does not possess an7 ri;0t to0ave its 34ai) re3orded in t0e BSP@s *oo8s? 3onse51ent47, t0e PDB 3annot proper47 *e3onsidered even as a potentia4 34ai)ant to t0e pro3eeds o/ t0e CB *i44s 1pon )at1rit7. T01s,t0e interp4eader 2as on47 an a4ternative position, )ade on47 in t0e BSP@s Ans2er. "s /ro) t0ose 4e;a447entit4ed to pa7)ent.

nterp4eader is a 3ivi4 a3tion )ade spe3ia4 *7 t0e eisten3e o/ parti314ar r14es to ;overn t0e1ni51eness o/ its app4i3ation and operation. Qnder Se3tion +, R14e o/ t0e R14es o/ Co1rt,;overnin; ordinar7 3ivi4 a3tions, a part7@s 34ai) is asserted =in a 3o)p4aint, 3o1nter34ai),3ross'34ai), t0ird 9/o1rt0, et3.:'part7 3o)p4aint, or 3o)p4aint'in'intervention.= n an


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interp4eader s1it, 0o2ever, a 34ai) is not re51ired to *e 3ontained in an7 o/ t0ese p4eadin;s*1t in t0e ans2er'9o/ t0e 3oni3tin; 34ai)ants:'in'interp4eader. T0is 34ai) is dierent /ro)t0e 3o1nter'34ai) 9or 3ross'34ai), t0ird part7'3o)p4aint: 20i30 is separate47 a44o2ed 1nderSe3tion #, par. + o/ R14e +. DCSTa

+. t0e pa7)ent o/ do38et /ees

3overin; BOC@s 3o1nter34ai)

T0e PDB ar;1es t0at, even ass1)in; t0at t0e RTC 0as 1risdi3tion over t0e iss1e o/o2ners0ip o/ t0e CB *i44s, t0e BOC@s /ai41re to pa7 t0e appropriate do38et /ees prevents t0eRTC /ro) a351irin; 1risdi3tion over t0e BOC@s =3o1nter34ai)s.=

Ie disa;ree 2it0 t0e PDB.

To reiterate and re3a44, t0e order ;rantin; t0e =PDB@s )otion to interp4ead,= a4read7 res14tedin t0e dis)issa4 o/ t0e PDB@s petition. T0e sa)e order re51ired t0e BOC to a)end its ans2erand /or t0e 3oni3tin; 34ai)ants to 3o))ent, pres1)a*47 to 3on/or) to t0e nat1re o/ anans2er'in'interp4eader. Per0aps, *7 reason o/ t0e BOC@s deno)ination o/ its 34ai) as a=3o)p14sor7'3o1nter34ai)= and t0e PDB@s /ai41re to /1447 appre3iate t0e RTC@s order ;rantin;

t0e =BSP@s )otion /or interp4eader= 92it0 t0e PDB@s 3on/or)it7:, t0e PDB )ista8en47 treatedt0e BOC@s 34ai) as a =per)issive 3o1nter34ai)= 20i30 ne3essitates t0e pa7)ent o/ do38et/ees. aE3S

As t0e pre3edin; dis31ssions 2o14d s0o2, 0o2ever, t0e BOC@s =34ai)= i.e., its assertion o/o2ners0ip over t0e CB *i44s is in rea4it7 1st t0at, a =34ai)= a;ainst t0e sta8e0o4der and notas a =3o1nter34ai),= "$$ 20et0er 3o)p14sor7 "$# or per)issive. t is on47 t0e BOC@sa4ternative pra7er 9/or t0e PDB to de4iver to t0e BOC, as t0e *17er in t0e Apri4 "# transa3tionand t0e 14ti)ate s133essor'in'interest o/ t0e *17er in t0e Apri4 "& transa3tion, eit0er t0eori;ina4 s1*e3ts o/ t0e sa4es or t0e va41e t0ereo/ p41s 20atever in3o)e t0at )a7 0ave *eenearned pendente 4ite: and its pra7er /or da)a;es t0at are o*vio1s47 3o)p14sor73o1nter34ai)s a;ainst t0e PDB and, t0ere/ore, does not re51ire pa7)ent o/ do38et /ees. "$

T0e PDB ta8es a 3ontrar7 position t0ro1;0 its insisten3e t0at a 3o)p14sor7 3o1nter34ai)s0o14d *e one 20ere t0e presen3e o/ t0ird parties, o/ 20o) t0e 3o1rt 3annot a351ire

1risdi3tion, is not re51ired. t reasons o1t t0at sin3e t0e RCBC and A44 Asia 9t0e intervenin;0o4ders o/ t0e CB *i44s: 0ave a4read7 *een dropped /ro) t0e 3ase, t0en t0e BOC@s3o1nter34ai) )1st on47 *e per)issive in nat1re and t0e BOC s0o14d 0ave paid t0e 3orre3tdo38et /ees. S3TCE

Ie see no reason to *e4a*or t0is 34ai). Even i/ 2e ;4oss over t0e PDB@s o2n 3on/or)it7 tot0e droppin; o/ t0ese entities as parties, t0e BOC 3orre3t47 ar;1es t0at a re)ed7 is provided1nder t0e R14es. Se3tion "+, R14e o/ t0e R14es o/ Co1rt reads

SEC. "+. Brin;in; ne2 parties. I0en t0e presen3e o/ parties ot0er t0an t0ose to t0eori;ina4 a3tion is re51ired /or t0e ;rantin; o/ 3o)p4ete re4ie/ in t0e deter)ination o/ a3o1nter34ai) or 3ross'34ai), t0e 3o1rt s0a44 order t0e) to *e *ro1;0t in as de/endants, i/

1risdi3tion over t0e) 3an *e o*tained.

Even t0en, t0e stri3t 30ara3teriation o/ t0e BOC@s 3o1nter34ai) is no 4on;er )ateria4 indisposin; o/ t0e PDB@s ar;1)ent *ased on non'pa7)ent o/ do38et /ees.

I0en an a3tion is 64ed in 3o1rt, t0e 3o)p4aint )1st *e a33o)panied *7 t0e pa7)ent o/ t0ere51isite do38et and 64in; /ees *7 t0e part7 see8in; aJr)ative re4ie/ /ro) t0e 3o1rt. t is t0e64in; o/ t0e 3o)p4aint or appropriate initiator7 p4eadin;, a33o)panied *7 t0e pa7)ent o/ t0epres3ri*ed do38et /ee, t0at vests a tria4 3o1rt 2it0 1risdi3tion over t0e 34ai) or t0e nat1re o/ t0e a3tion. "$ o2ever, t0e non'pa7)ent o/ t0e do38et /ee at t0e ti)e o/ 64in; does not


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a1to)ati3a447 3a1se t0e dis)issa4 o/ t0e 3ase, so 4on; as t0e /ee is paid 2it0in t0e app4i3a*4epres3riptive or re;4e)entar7 period, espe3ia447 20en t0e 34ai)ant de)onstrates a2i44in;ness to a*ide *7 t0e r14es pres3ri*in; s130 pa7)ent. "$%

n t0e present 3ase, 3onsiderin; t0e 4a38 o/ a 34ear ;1ide4ine on t0e pa7)ent o/ do38et /ee*7 t0e 34ai)ants in an interp4eader s1it, 3o)po1nded *7 t0e 1n1s1a4 )anner in 20i30 t0einterp4eader s1it 2as initiated and t0e 3ir31)stan3es s1rro1ndin; it, 2e s1re47 3annotded13e /ro) t0e BOC@s )ere /ai41re to spe3i/7 in its pra7er t0e tota4 a)o1nt o/ t0e CB *i44s it4a7s 34ai) to 9or t0e va41e o/ t0e s1*e3ts o/ t0e sa4es in t0e Apri4 "# and Apri4 "&transa3tions, in its a4ternative pra7er: an intention to de/ra1d t0e ;overn)ent t0at 2o14d2arrant t0e dis)issa4 o/ its 34ai). "$&

At an7 rate, re;ard4ess o/ t0e nat1re o/ t0e BOC@s =3o1nter34ai)s,= /or p1rposes o/ pa7)ento/ 64in; /ees, *ot0 t0e BOC and t0e PDB, proper47 as de/endants'in'interp4eader, )1st *eassessed t0e pa7)ent o/ t0e 3orre3t do38et /ee arisin; /ro) t0eir respe3tive 34ai)s. T0ese)ina4 3ase o/ S1n ns1ran3e OJ3e, Ltd. v. -1d;e As1n3ion "#( provides 1s ;1idan3e in t0epa7)ent o/ do38et /ees, to 2it aA3DSC

". . . . I0ere t0e 64in; o/ t0e initiator7 p4eadin; is not a33o)panied *7 pa7)ent o/ t0edo38et /ee, t0e 3o1rt )a7 a44o2 pa7)ent o/ t0e /ee 2it0in a reasona*4e ti)e *1t in no 3ase

*e7ond t0e app4i3a*4e pres3riptive or re;4e)entar7 period. S3AT

+. T0e sa)e r14e app4ies to per)issive 3o1nter34ai)s, t0ird'part7 34ai)s and si)i4arp4eadin;s, 20i30 s0a44 not *e 3onsidered 64ed 1nti4 and 1n4ess t0e 64in; /ee pres3ri*edt0ere/or is paid. T0e 3o1rt )a7 a4so a44o2 pa7)ent o/ said /ee 2it0in a reasona*4e ti)e *1ta4so in no 3ase *e7ond its app4i3a*4e pres3riptive or re;4e)entar7 period. !1nders3orin;o1rs

T0is )1st *e t0e r14e 3onsiderin; t0at Se3tion , R14e + o/ 20i30 reads

SEC. .Do38et and ot0er 4a2/14 /ees, 3osts and 4iti;ation epenses as 4iens. T0e do38etand ot0er 4a2/14 /ees paid *7 t0e part7 20o 64ed a 3o)p4aint 1nder t0is R14e, as 2e44 as t0e3osts and 4iti;ation epenses, s0a44 3onstit1te a 4ien or 30ar;e 1pon t0e s1*e3t )atter o/ t0ea3tion, 1n4ess t0e 3o1rt s0a44 order ot0er2ise. ADa3C

on47 pertain to t0e do38et and 4a2/14 /ees to *e paid *7 t0e one 20o initiated t0einterp4eader s1it, and 20o, 1nder t0e R14es, a3t1a447 =34ai)s no interest 20atever in t0es1*e3t )atter.= B7 3onstit1tin; a 4ien on t0e s1*e3t )atter o/ t0e a3tion, Se3tion in ee3ton47 ai)s to a3t1a447 3o)pensate t0e 3o)p4ainant'in'interp4eader, 20o 0appens to *e t0esta8e0o4der 1n/ort1nate eno1;0 to ;et 3a1;0t in a 4e;a4 3ross6re *et2een t2o or )ore3oni3tin; 34ai)ants, /or t0e /a14t4ess tro1*4e it /o1nd itse4/ into. Sin3e t0e de/endants'in'interp4eader are a3t1a447 t0e ones 20o )a8e a 34ai) on47 t0at it 2as etraordinari47 donet0ro1;0 t0e pro3ed1ra4 devi3e o/ interp4eader t0en to t0e) devo4ves t0e d1t7 to pa7 t0edo38et /ees pres3ri*ed 1nder R14e "$" o/ t0e R14es o/ Co1rt, as a)ended. "#"

T0e i)portan3e o/ pa7in; t0e 3orre3t a)o1nt o/ do38et /ee 3annot *e overe)p0asied

T0e )atter o/ pa7)ent o/ do38et /ees is not a )ere trivia4it7. T0ese /ees are ne3essar7 tode/ra7 3o1rt epenses in t0e 0and4in; o/ 3ases. Conse51ent47, in order to avoid tre)endo1s4osses to t0e 1di3iar7, and to t0e ;overn)ent as 2e44, t0e pa7)ent o/ do38et /ees 3annot *e)ade dependent on t0e o1t3o)e o/ t0e 3ase, e3ept 20en t0e 34ai)ant is a pa1per'4iti;ant."#+

IEREFORE, pre)ises 3onsidered t0e 3onso4idated PETTONS are GRANTED. T0e P4antersDeve4op)ent Ban8 is 0ere*7 REHQRED to 64e 2it0 t0e Re;iona4 Tria4 Co1rt its 3o))ent orans2er'in'interp4eader to Ban8 o/ Co))er3e@s A)ended Conso4idated Ans2er 2it0Co)p14sor7 Co1nter34ai), as previo1s47 ordered *7 t0e Re;iona4 Tria4 Co1rt. T0e Re;iona4


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Tria4 Co1rt o/ Ma8ati Cit7, Bran30 "$

bank of commerce vs planters developmet - g.r. nos. 154470-71. september 24, 2012

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