July 2007 - Philippine Supreme Court Resolutions
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[G.R. No. 176541 : July 25, 2007] BANK OF CEBU, THE COMMON STOCK SHAREHOLDERS, THE DEPOSITORS AND THE EMPLOYEES OF BANK OF CEBU V. MONETARY BOARD OF THE BANGKO SENTRAL NG PILIPINAS, BANGKO SENTRAL NG PILIPINAS, FERNANDO B. CABALLA, NILA F. A. NAZARENO, DINDO SANTOS AND ERNESTO RAMOS, PHILIPPINE DEPOSIT INSURANCE CORPORATION, IMELDA S. SINGZON, NANCY SEVILLA, AND BENEFICIO MAGDAY :
[G.R. No. 176541 : July 25, 2007]
BANK OF CEBU, THE COMMON STOCK SHAREHOLDERS, THE DEPOSITORS AND THE EMPLOYEES OF BANK OF CEBU V. MONETARY BOARD OF THE BANGKO SENTRAL NG PILIPINAS, BANGKO SENTRAL NG PILIPINAS, FERNANDO B. CABALLA, NILA F. A. NAZARENO, DINDO SANTOS AND ERNESTO RAMOS, PHILIPPINE DEPOSIT INSURANCE CORPORATION, IMELDA S. SINGZON, NANCY SEVILLA, AND BENEFICIO MAGDAY
Sirs/Mesdames:
Quoted hereunder, for your information, is a resolution of this Court dated 25 July 2007:
G.R. No. 176541 (Bank of Cebu, the Common Stock Shareholders, the Depositors and the Employees of Bank of Cebu v. Monetary Board of the Bangko Sentral ng Pilipinas, Bangko Sentral ng Pilipinas, Fernando B. Caballa, Nila F. A. Nazareno, Dindo Santos and Ernesto Ramos, Philippine Deposit Insurance Corporation, Imelda S. Singzon, Nancy Sevilla, and Beneficio Magday).�This treats of petitioners' motion for reconsideration of the Court's Resolution dated 19 March 2007, which denied the petition for review on certiorari based on the submission of a defective verification and certification of non-forum shopping as well as the failure to submit a valid affidavit of service. The verification and certification of non-forum shopping was signed only by the counsels of record of petitioners.
The instant petition assails the Decision of the Court of Appeals in CA-G.R. CEB-SP No. 02081, which denied the petition for certiorari seeking to nullify Resolution No. 1090 issued by respondent Monetary Board. Said resolution placed the Bank of Cebu Under the receivership of respondent Philippine Deposit Insurance Corporation and prohibited it from doing business on the ground that it had insufficient realizable assets to meet its liabilities and could not continue in business without involving probable losses to its depositors or creditors unless fresh funds were infused.
The verification requirement is significant, as it is intended to secure an assurance that the allegations in the pleading are true and correct and not the product of the imagination or a matter of speculation, and that the pleading is filed in good faith. The absence of a proper verification is cause to treat the pleading as unsigned and dismissible.[1]
That the certification of non-forum shopping should be executed and signed by the plaintiff or the principal means that counsel cannot sign it unless clothed with special authority to do so. The reason for this is that the plaintiff or principal knows better than anyone else whether a petition has previously been filed involving the same case or substantially the same issues. Hence, a certification signed by counsel alone is defective and constitutes a valid cause for dismissal of the petition. In the case of natural persons, the Rule requires the parties themselves to sign the certificate of non-forum shopping. However, in the case of corporations, the physical act of signing may be performed, on behalf of the corporate entity, only by specifically authorized individuals for the simple reason that corporations, as artificial persons, cannot personally do the task themselves.[2]
Moreover, the certification of non-forum shopping must be signed by all the petitioners or plaintiffs in a case and the signing by only one of them is generally insufficient because a lone signatory cannot be presumed to have personal knowledge of the matters required to be stated in the attestation.[3]
Petitioners maintain that there was substantial compliance of the aforementioned rules. They argue that their counsels of record had and continue to have personal knowledge of the facts and circumstances averred in the petition or that they were authorized by petitioners to represent them in this case. One of the counsels claims that he was concurrently the Corporate Secretary and Vice President of the bank while Silvino Maceren, Jr. claims to be a depositor having a substantial interest and, therefore, authorized to represent the depositors of the bank.
Unfortunately, the allegations are unsubstantiated as there is nothing on record showing the authority of the counsels of record to institute the petition on behalf of the bank, or the bank's shareholders or depositors. No board resolution of petitioner bank empowering counsel to institute the petition on behalf of the bank is attached to the record. In the case of the unnamed shareholders, depositors, and employees who are made petitioners on the caption of the petition, there is nary an allegation therein to indicate their standing to file the petition independently of the bank itself in the first place. Hence, it is useless to inquire who are authorized to file the petition in behalf of the so-called shareholders, depositors, and employees.
In Teoville Homeowners Association, Inc. v. Ferreira,[4] the Court disallowed a petition for lack of showing that counsel for petitioner therein was specifically authorized to sign the verification and certification of non-forum shopping.
It cannot be gainsaid that obedience to the requirements of procedural rule is needed if we are to expect fair results therefrom. Utter disregard of the rules cannot justly be rationalized by harking on the policy of liberal construction.[5]
It is true that a litigation is not a game of technicalities and that the rules of procedure should not be strictly enforced at the cost of substantial justice. However, it does not mean that the Rules of Court may be ignored at will and at random to the prejudice of the orderly presentation and assessment of the issues and their just resolution. It must be emphasized that procedural rules should not be belittled or dismissed simply because their non-observance may have resulted in prejudice to a party's substantial rights. Like all rules, they are required to be followed except only for the most persuasive of reasons.[6]
More fundamentally, the Court of Appeals did not commit any reversible error in dismissing the petition for certiorari. As it pointed out in the assailed decision, Section 30 of Republic Act (R.A.) No. 7653 requires that only stockholders of record representing the majority of the capital stock of the bank placed under receivership can file an action to nullify a resolution issued by the Monetary Board placing a bank under receivership.[7]
As it was before the Court of Appeals where petitioners did not even file a motion for the reconsideration of its decision, before this Court they have not fared any better as they opt in their petition to dodge the point stressed by the appellate court. Instead, petitioners raise a feeble challenge to the constitutionality of Section 30 of R.A. No. 7653, otherwise known as the New Central Bank Act, with the equal protection clause as basis, contending that as the law considers only the interest of the stockholders, the constituency they call "stakeholders," which apparently include depositors and employees, are deprived of their rights. The challenge is amorphous as it is puerile.
In view of the foregoing, the motion for reconsideration is DENIED with FINALITY.
G.R. No. 176541 (Bank of Cebu, the Common Stock Shareholders, the Depositors and the Employees of Bank of Cebu v. Monetary Board of the Bangko Sentral ng Pilipinas, Bangko Sentral ng Pilipinas, Fernando B. Caballa, Nila F. A. Nazareno, Dindo Santos and Ernesto Ramos, Philippine Deposit Insurance Corporation, Imelda S. Singzon, Nancy Sevilla, and Beneficio Magday).�This treats of petitioners' motion for reconsideration of the Court's Resolution dated 19 March 2007, which denied the petition for review on certiorari based on the submission of a defective verification and certification of non-forum shopping as well as the failure to submit a valid affidavit of service. The verification and certification of non-forum shopping was signed only by the counsels of record of petitioners.
The instant petition assails the Decision of the Court of Appeals in CA-G.R. CEB-SP No. 02081, which denied the petition for certiorari seeking to nullify Resolution No. 1090 issued by respondent Monetary Board. Said resolution placed the Bank of Cebu Under the receivership of respondent Philippine Deposit Insurance Corporation and prohibited it from doing business on the ground that it had insufficient realizable assets to meet its liabilities and could not continue in business without involving probable losses to its depositors or creditors unless fresh funds were infused.
The verification requirement is significant, as it is intended to secure an assurance that the allegations in the pleading are true and correct and not the product of the imagination or a matter of speculation, and that the pleading is filed in good faith. The absence of a proper verification is cause to treat the pleading as unsigned and dismissible.[1]
That the certification of non-forum shopping should be executed and signed by the plaintiff or the principal means that counsel cannot sign it unless clothed with special authority to do so. The reason for this is that the plaintiff or principal knows better than anyone else whether a petition has previously been filed involving the same case or substantially the same issues. Hence, a certification signed by counsel alone is defective and constitutes a valid cause for dismissal of the petition. In the case of natural persons, the Rule requires the parties themselves to sign the certificate of non-forum shopping. However, in the case of corporations, the physical act of signing may be performed, on behalf of the corporate entity, only by specifically authorized individuals for the simple reason that corporations, as artificial persons, cannot personally do the task themselves.[2]
Moreover, the certification of non-forum shopping must be signed by all the petitioners or plaintiffs in a case and the signing by only one of them is generally insufficient because a lone signatory cannot be presumed to have personal knowledge of the matters required to be stated in the attestation.[3]
Petitioners maintain that there was substantial compliance of the aforementioned rules. They argue that their counsels of record had and continue to have personal knowledge of the facts and circumstances averred in the petition or that they were authorized by petitioners to represent them in this case. One of the counsels claims that he was concurrently the Corporate Secretary and Vice President of the bank while Silvino Maceren, Jr. claims to be a depositor having a substantial interest and, therefore, authorized to represent the depositors of the bank.
Unfortunately, the allegations are unsubstantiated as there is nothing on record showing the authority of the counsels of record to institute the petition on behalf of the bank, or the bank's shareholders or depositors. No board resolution of petitioner bank empowering counsel to institute the petition on behalf of the bank is attached to the record. In the case of the unnamed shareholders, depositors, and employees who are made petitioners on the caption of the petition, there is nary an allegation therein to indicate their standing to file the petition independently of the bank itself in the first place. Hence, it is useless to inquire who are authorized to file the petition in behalf of the so-called shareholders, depositors, and employees.
In Teoville Homeowners Association, Inc. v. Ferreira,[4] the Court disallowed a petition for lack of showing that counsel for petitioner therein was specifically authorized to sign the verification and certification of non-forum shopping.
It cannot be gainsaid that obedience to the requirements of procedural rule is needed if we are to expect fair results therefrom. Utter disregard of the rules cannot justly be rationalized by harking on the policy of liberal construction.[5]
It is true that a litigation is not a game of technicalities and that the rules of procedure should not be strictly enforced at the cost of substantial justice. However, it does not mean that the Rules of Court may be ignored at will and at random to the prejudice of the orderly presentation and assessment of the issues and their just resolution. It must be emphasized that procedural rules should not be belittled or dismissed simply because their non-observance may have resulted in prejudice to a party's substantial rights. Like all rules, they are required to be followed except only for the most persuasive of reasons.[6]
More fundamentally, the Court of Appeals did not commit any reversible error in dismissing the petition for certiorari. As it pointed out in the assailed decision, Section 30 of Republic Act (R.A.) No. 7653 requires that only stockholders of record representing the majority of the capital stock of the bank placed under receivership can file an action to nullify a resolution issued by the Monetary Board placing a bank under receivership.[7]
As it was before the Court of Appeals where petitioners did not even file a motion for the reconsideration of its decision, before this Court they have not fared any better as they opt in their petition to dodge the point stressed by the appellate court. Instead, petitioners raise a feeble challenge to the constitutionality of Section 30 of R.A. No. 7653, otherwise known as the New Central Bank Act, with the equal protection clause as basis, contending that as the law considers only the interest of the stockholders, the constituency they call "stakeholders," which apparently include depositors and employees, are deprived of their rights. The challenge is amorphous as it is puerile.
In view of the foregoing, the motion for reconsideration is DENIED with FINALITY.
Very truly yours,
(Sgd.)LUDICHI YASAY-NUNAG
Clerk of Court
(Sgd.)LUDICHI YASAY-NUNAG
Clerk of Court
Endnotes:
[1] Chua v. Torres, G.R. No. 1,51900, 30 August 2005,468 SCRA 358, 365.
[2] Mariveles Shipyard Corporation v. Court of Appeals, 461 Phil. 249, 263-264.
[3] Spouses Estates v. Court of Appeals, G.R. No. 144755, 8 June 2005, 459 SCRA 604, 616-617.
[4] G.R. No. 140086, 8 June 2005, 459 SCRA 459.
[5] Mariveles Shipyard Corporation v. Court of Appeals, supra note 2 at 264
[6] Teaville Homeowners v. Ferreira, supra note 4 at 471
[7] Republic Act No. 7653 (1993), Sec. 30. Proceedings in Receivership and Liquidation.
x x x x
The actions of the Monetary Board taken under this section or under Section 29 of this Act shall be final and executory, and may not be restrained or set aside by the court except on petition for certiorari on the ground that the action taken was in excess of jurisdiction or with such grave abuse of discretion as to amount to lack or excess of jurisdiction. The petition for certiorari may only be filed by the stockholders of record representing the majority of the capital stock within ten (10) days from receipt by the board of directors of the institution of the order directing receivership, liquidation or conservatorship.
