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This web page features the full text of
CIRCULAR NO. 13.
[1984]
CIRCULAR NO. 13 
[1984]

TO:  THE JUSTICES OF THE INTERMEDIATE APPELLATE COURT, JUDGES OF THE REGIONAL TRIAL COURTS, METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL COURTS AND MUNICIPAL CIRCUIT TRIAL COURTS

In view of information received by the undersigned to the effect that at times there had been less than strict observance of the provisions of Batas Pambansa Blg. 224 as well as certain Presidential Decrees, the attention of the Presiding Justice and Associate Justices of the Intermediate Appellate Court and the Judges of the other inferior courts is invited to Presidential Decree No. 385 entitled "Requiring Government Financial Institutions to Foreclose Mandatorily All Loans with Arrearages, Including Interest and Charges Amounting to at Least Twenty Percent (20%) of the Total Outstanding Obligation," and Presidential Decree No. 1818 entitled "Prohibiting Courts from Issuing Restraining Orders or Preliminary Injunctions in Cases Involving Infrastructure and Natural Resource Development Projects of, and Public Utilities Operated by, the Government; "and to Batas Pambansa 224 entitled "An Act Regulating the Issuance of Restraining Orders, Amending for the Purpose of Section Five of Rule Fifty-Eight of the Rules of Court."

The pertinent sections of Presidential Decree No. 385 provide:chanroblesvirtuallawlibrary

"SECTION 1. It shall be mandatory for government financial institutions, after the lapse of sixty [60] days from the issuance of this Decree, to foreclose the collaterals and/or guarantees granted by them whether the arrearages on such account, including accrued interest and other charges, amount to at least twenty percent [20%] of the total outstanding obligations, including interest and other charges, as appearing in the books of account and/or related records of the financial institution concerned. This shall be without prejudice to the exercise by the government financial institutions of such rights and/or remedies available to them under their respective contracts with their debtors, including the right to foreclosure on loans, credits, accommodations and/or guarantees on which the arrearages are less than twenty percent [20%].  "SECTION 2. No restraining order, temporary or permanent injunction shall be issued by the Court against any government financial institution in any action taken by such institution in compliance with the mandatory foreclosure provided in Section 1 hereof, whether such restraining order, temporary or permanent injunction is sought by the borrower(s) or any third party or parties, except after due hearing in which it is established by the borrower and admitted by the government financial institution concerned that twenty percent [20%] of the outstanding arrearages has been paid after the filing of foreclosure proceedings.  "In case a restraining order or injunction is issued, the borrower shall nevertheless be legally obligated to liquidate the remaining balance of the arrearages, paying ten percent [10%] of the arrearages outstanding as of the time of foreclosure, plus interest and other charges, on every succeeding thirtieth [30th] day after the issuance of such restraining order or injunction until the entire arrearages have been liquidated. These shall be in addition to the payment of amortizations currently maturing. The restraining order or injunction shall automatically be dissolved should the borrower fail to make any of the above-mentioned payments on due dates, and no restraining order or injunction shall be issued thereafter.  "All restraining orders and injunctions existing as of the date of this Decree on foreclosure proceedings filed by said government financial institutions, shall be considered lifted unless finally resolved by the Court within sixty [60] days from date hereof."Section 1 of Presidential Decree No. 1818 reads:chanroblesvirtuallawlibrary "SECTION 1. No Court in the Philippines shall have jurisdiction to issue any restraining order, preliminary injunction, or preliminary mandatory injunction in any case, dispute, or controversy involving an infrastructure project, or a mining, fishery, forest or other natural resource development project of the government, or any public utility operated by the government, including among others public utilities for the transport of the goods or commodities, stevedoring and arrastre contracts, to prohibit any person or persons; entity or government official from proceeding with, or continuing the execution or implementation of any such project, or the operation of such public utility, or pursuing any lawful activity necessary for such execution, implementation or operation."The entire text of Batas Pambansa Blg. 224 follows:chanroblesvirtuallawlibrary "SECTION 1. Section five of Rule fifty-eight of the Rules of Court in the Philippines is hereby amended to read as follows:chanroblesvirtuallawlibrary
'SECTION 5. Preliminary injunction not granted without notice; issuance of restraining order. - No preliminary injunction shall be granted without notice to the defendant. If it shall appear from the facts shown by affidavits or by the verified complaint that great or irreparable injury would result to the applicant before the matter can be heard on notice, the judge to whom the application for preliminary injunction was made, may issue a restraining order to be effective only for a period of twenty days from date of its issuance. Within the said twenty-day period, the judge must cause an order to be served on the defendant, requiring him to show cause at a specified time and place, why the injunction should not be granted, and determine within the same period whether or not the preliminary injunction shall be granted, and shall accordingly issue the corresponding order. In the event that the application for preliminary injunction is denied, the restraining order is deemed automatically vacated.  "Nothing herein contained shall be construed to impair, affect or modify in any way any rights granted by, or rules pertaining to injunctions contained in, existing agrarian, labor or social legislation.

"SECTION 2. Any provision of law, decree or resolution inconsistent with the provisions of this Act is hereby deemed repealed, superseded or modified accordingly.

"SECTION 3. This Act shall take effect upon its approval.cralaw:red

"Approved, April 16, 1982. [B. P. No. 293]."

Strict compliance is herewith enjoined.


May 17, 1984.

 

 

[Sgd.] ENRIQUE M. FERNANDO
Chief Justice
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