MARTIN B. ROSARIO, SERGIO SIOJO, JULIAN GABRIEL, DEMETRIA GABRIEL, WILSON PASANA, NIDA PASANA, JESUSA ARBOLEDA, RODRIGO ARBOLEDA, GLORIA BERNAL, ANTONIO BERNAL, REMEDIOS FLORES,…

Rosario versus Philippine Deposit Insurance Corporation

The Case

This is a petition for review on certiorari brought by Martin Rosario and sixty-seven other depositors of the Rural Bank of Alcala, Pangasinan, against the Philippine Deposit Insurance Corporation and the officers and stockholders of the Bank. The depositors sued for a sum of money with damages after the Bank failed to return their time deposits. The case matters for two reasons. First, it teaches where claims against a bank in liquidation must be filed. Second, and more sharply for the bar candidate, it is a stern lesson on the finality of judgments and on the mandatory requirements of a petition for review under Rule 45.

Procedural History

The depositors filed their complaint for sum of money with damages before the Regional Trial Court of San Carlos City, Pangasinan, Branch 57. The Bank, through the Philippine Deposit Insurance Corporation as its receiver, moved to dismiss on the ground that the court had no jurisdiction, because a petition for assistance in the liquidation of the Bank was already pending before the Regional Trial Court of Villasis, Pangasinan, Branch 50. The San Carlos court granted the motion and dismissed the case for lack of jurisdiction.

The depositors appealed to the Court of Appeals. The Court of Appeals affirmed the dismissal, holding that under Section 30 of Republic Act Number 7653, the New Central Bank Act, the liquidation court acquired exclusive jurisdiction not only over claims against the Bank but also over claims against its stockholders, directors and officers.

The depositors then moved for reconsideration, but the Court of Appeals denied it as filed out of time, relying on the report of the Postmaster of Alabang, Muntinlupa City, that the Decision had been received at the office of their counsel on 12 October 1998. Hence this petition for review on certiorari before the Supreme Court.

Facts

Sometime in 1992, the depositors opened time deposit accounts with the Rural Bank of Alcala, Pangasinan, enticed by representations of high interest rates. In the aggregate they deposited Two Million Two Hundred Forty One Thousand Eight Hundred Twenty One Pesos and 75/100. They earned interest for the first three months, but not for the succeeding months.

When they sought to withdraw, the Bank could not pay. It had suffered a bank run from December 1991 to March 1992 and was ordered closed by the Monetary Board in December 1992. The Philippine Deposit Insurance Corporation took over the Bank in January 1993, and the Monetary Board ordered its liquidation in May 1993. The depositors filed their claims with the Corporation, which was allegedly willing to pay only twenty five percent of their deposits. They blamed the bank run on officers and stockholders who had granted loans to bank officers and to fictitious persons who never paid.

The depositors sued the Corporation and the individual officers and stockholders, later amending their complaint to implead the Bank itself. The Bank, through the Corporation as receiver, moved to dismiss, invoking the pendency of the liquidation proceedings in the Villasis court. The trial court dismissed the case, the Court of Appeals affirmed, and the depositors' motion for reconsideration was denied as late.

Issues

• Whether or not the motion for reconsideration filed by the depositors with the Court of Appeals was filed on time.
• Whether or not the Court of Appeals was correct in affirming the dismissal by the Regional Trial Court of San Carlos City of the complaint for lack of jurisdiction, in view of the pendency of the liquidation proceedings before the Regional Trial Court of Villasis, Pangasinan.

Applicable Provisions

Section 5 of Rule 45 of the 1997 Rules of Civil Procedure provides:

Failure of the petitioner to comply with any of the foregoing requirements regarding the payment of the docket and other lawful fees, the deposit for costs, proof of service of the petition, and the contents of and the documents which should accompany the petition shall be sufficient ground for the dismissal thereof.

This provision bears on the case because the depositors' petition was mailed without a duplicate original or certified true copy of the assailed Decision and Resolution, and without proof of service on the Court of Appeals and the respondents, which alone warranted dismissal.

Section 1 of Rule 22 of the 1997 Rules of Civil Procedure provides:

In computing any period of time prescribed or allowed by these Rules, by order of court, or by any applicable statute, the day of the act or event from which the designated period of time begins to run is to be excluded and the date of performance included. If the last day of the period, as thus computed, falls on a Saturday, a Sunday, or a legal holiday in the place where the court sits, the time shall not run until the next working day.

This provision governs the reckoning of the fifteen-day period to move for reconsideration, which the Court counted from the date the copy of the Decision was actually delivered to the office of counsel.

Ruling

On the first issue, the Court held that the motion for reconsideration was filed late. A copy of the Decision was delivered to the address of the depositors' counsel on 12 October 1998 and was received by a certain Mr. Magalang. The fifteen-day period therefore expired on 27 October 1998. The depositors erroneously counted from 26 October 1998, the date their counsel claimed he actually saw the copy. When they filed their motion on 04 November 1998, the Decision had already become final and executory, and there was nothing left for the Court of Appeals to reconsider.

On the second issue, the Court found it unnecessary to resolve the substantive question, because the finality of the Decision deprived it of jurisdiction. The Court also noted at the outset that the petition should have been denied outright for non-compliance with Rule 45, since it was mailed without the required accompanying documents and without proof of service, and it quoted the provision that such failure is a sufficient ground for dismissal.

Doctrine

Two rules must be retained. First, the fifteen-day period to file a motion for reconsideration is counted from the date the copy of the judgment is delivered to the address of counsel, not from the date counsel personally reads it. Once that period lapses, the judgment becomes final and executory, and the Supreme Court acquires no jurisdiction over a later petition, however meritorious the substantive claims may be.

Second, a petition for review under Rule 45 must comply strictly with the requirements on accompanying documents and proof of service. Failure to comply is a sufficient ground for dismissal under Section 5 of Rule 45, as quoted above. The Court also affirmed that under Section 30 of the New Central Bank Act, the court hearing the liquidation proceedings acquires exclusive jurisdiction over claims against the bank and, as the Court of Appeals held, over the related liabilities of its stockholders, directors and officers.

Disposition

The petition was denied, and the Decision of the Court of Appeals affirming the dismissal of the complaint stood.

Remember This

Memorize this line: the period to appeal or to move for reconsideration runs from delivery of the copy of the judgment to the address of counsel, and once it lapses the judgment becomes final and the Supreme Court loses jurisdiction. Examiners use this case to test the reckoning of reglementary periods and the mandatory documentary requirements of a Rule 45 petition.