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To institute a systematic procedure in the issuance of Certificates of Accreditation and Authority to surety companies, ensure the efficient and effective collection of liabilities under surety bonds and expedite the administration of justice, these guidelines are hereby issued for the compliance of all concerned. 

I. AUTHORITY OF THE OFFICE OF THE COURT ADMINISTRATOR chan robles virtual law library

Under Presidential Decree 828, as amended by P.D. 842, and Supreme Court Resolution dated October 24, 1996, the Office of the Court Administrator (OCA) assists the Supreme Court in exercising administrative supervision over all lower courts, specifically on administrative matters, court management problems, fiscal operations and legal concerns involving the lower courts. Corollary to its functions, the OCA is designated as the implementing arm of the Court in the enforcement of the policies and procedure on surety bonds.

II. ACCREDITATION OF SURETY COMPANIES chan robles virtual law library

In order to preclude spurious and delinquent surety companies from transacting business with the courts, no surety company or its authorized agents shall be allowed to transact business involving surety bonds with the Supreme Court, Court of Appeals, the Court of Tax Appeals, the Sandiganbayan, Regional Trial Courts, Shari’a District Courts, Metropolitan Trial Courts, Municipal Trial Courts in Cities, Municipal Trial Courts, Municipal Circuit Trial Courts, Shari’a Circuit Courts and other courts which may thereafter be created, unless accredited and authorized by the Office of the Court Administrator.  

A. Procedure for Accreditation 

The surety company shall file five (5) verified copies of the application for accreditation with the Docket and Clearance Division, Legal Office, OCA. The surety company shall indicate in said application the province/s and/or city/ies where it intends to transact surety business and whether said business involves civil/special proceedings and/or criminal cases. The surety company shall file a separate application for accreditation for criminal (SB Form No. 01-2004, Annex “A”) and civil/special proceedings cases (SB Form No. 02-2004, Annex “A-1”).chan robles virtual law library

The following documents shall be attached to the application form:chanroblesvirtuallawlibrary

A.1. Certified copy of the Articles of Incorporation and By-laws;chan robles virtual law library

A.2. Certified copy of the latest General Information Sheet submitted to the Securities and Exchange Commission; 

A.3. Secretary Certificate showing the surety company’s authorized signatories and their specimen signatures;chan robles virtual law library

A.4. Certified copy of the Authority To Transact Surety Business upon official recognizance, stipulations, bonds and undertakings issued by the Office of the Executive Secretary under the Office of the President;

A.5. Certified copy of the current Certificate of Authority from the Insurance Commission; 

A.6. Certified copy of latest Statement of Assets and Liabilities, and audited Financial Statements filed with the Bureau of Internal Revenue;chan robles virtual law library

A.7.  Sworn Statement relative to outstanding obligations with the courts, signed by the President and Treasurer, specifying the details as to: (a) Case Number, (b) Case Title, (c) Amounts due the courts, and attaching thereto pertinent documents such as Order of Forfeiture, etc.cralaw:red

A.8. Clearance certificates from all offices of the Clerks of Court (Executive Clerks of Court, Office of the Clerks of Court and Branch Clerks of Court) where the surety company intends to transact business or where it had transacted business before the approval of this guideline showing that the applicant has no outstanding obligation pertaining to forfeited bonds; and  chan robles virtual law library

A.9. Verified summary of transactions with the courts for the previous year.  (SB Form No. 03-2004, Annex “A-2”)

For the authorized agents of the insurance companies, the following additional documents shall be submitted:chanroblesvirtuallawlibrary

A.10. Joint Deed of Undertaking (SB Form No. 04-2004, Annex “A-3”);

A.11. Board Resolution issued by the surety company granting authority to its agent/s and acknowledging joint and solidary liability for all their acts and transactions with the Court; 

A.12. Personal Information Sheet of the authorized agent/s, with the accompanying specimen signatures (SB Form No.05-2004, Annex “A-4”) and ten (10) black and white copies of their latest 2x2 photographs; andchan robles virtual law library

A.13. Secretary Certificate containing the specimen signatures of the authorized agent/s authorized to transact business for and in behalf of the surety company. Additional duplicate copies of the Secretary Certificate may be subsequently requested. 

B. An application fee of Five Thousand Pesos (P5,000.00) and an additional fee of Five Hundred Pesos (P500.00) for each authorized agent shall be imposed upon the applicant. An application for accreditation that fails to comply with any of the above-listed requirements shall not be processed by the Docket and Clearance Division, Legal Office, OCA, and the applicant shall be notified of the deficiency or defect therein.chan robles virtual law library

C. If the application is complete with all the requirements, the Docket and Clearance Division, Legal Office, OCA, shall submit its recommendation to the Court Administrator for his appropriate action.  

If the Court Administrator approves the application of the surety company that intends to engage in transactions involving criminal cases, the company shall be required to make a One Million Peso (P1,000,000.00) cash deposit with the Financial Management Office (FMO), OCA, under the fiduciary account with the Land Bank of the Philippines in the name of the OCA-Supreme Court Surety Company Deposits (SCD). The cash deposit shall answer for the liabilities of the accredited surety company and its authorized agents in case of non-payment of its obligations pertaining to surety bonds.chan robles virtual law library

Upon One Million Peso (P1,000,000.00) cash deposit made by a surety company that intends to engage in transactions in criminal cases, the Court Administrator shall issue the corresponding Certificate of Accreditation and Authority which shall be stamped with the words “VALID FOR CRIMINAL CASES.” 

If the Court Administrator approves the application of a surety company for civil cases only, the One Million Peso (P1,000,000.00) cash deposit shall not be required. A Certificate of Accreditation and Authority stamped with the words “VALID FOR CIVIL /SPECIAL PROCEEDINGS CASES” shall be issued.chan robles virtual law library

The Court Administrator shall likewise issue a certified true copy of the Certificate of Accreditation and Authority containing the photograph of the authorized agent duly sealed and certified by the Court Administrator. 

D. The Docket and Clearance Division, Legal Office, OCA, shall furnish a copy of the Certificate of Accreditation and Authority and a list of accredited surety companies and their authorized agents to the concerned Clerks of Court of the Supreme Court, Court of Appeals, Court of Tax Appeals, Sandiganbayan and in the first and second level courts where the surety company intends to transact business.  The Clerks of Court shall post on the bulletin board the list of accredited surety companies and their respective authorized agents. 

E. If the application for accreditation is denied, the OCA shall inform the applicant surety company of the denial and the reasons therefor. The application fee shall be forfeited. 

F.  The Certificate of Accreditation and Authority shall be valid for six (6) months covering the periods August 01 to January 31 and February 01 to July 31. An application for Certificate of Accreditation and Authority filed after February 01 or August 01 shall be valid only for the remainder of the six-month period. 

G. In case a surety company intends to expand its area of operation during the six-month period, it shall file a new application form for accreditation.chan robles virtual law library

III. SUSPENSION OR CANCELLATION OF THE CERTIFICATE OF ACCREDITATION AND AUTHORITY 

The following are the grounds for the suspension or cancellation of the Certificate of Accreditation and Authority: 

1. The surety company has committed fraudulent or illegal acts in    transacting bonds;

2. Failure of the surety company to pay the amount of forfeited bond within fifteen (15) days from notice to pay from the sheriff;chan robles virtual law library

3. Non-compliance by the surety company with any of the provisions of this Circular and other issuances of the Supreme Court and the OCA;chan robles virtual law library

4. Non-renewal or cancellation of the Certificate of Authority by the Insurance Commission;

5. Failure to maintain the required One Million Peso (P1,000.000,00) deposit despite notice from the OCA;

6. Violation of the order/s of the courts relative to bonds issued by the surety company; and  

7. Other grounds that may be thereafter prescribed by the Supreme Court or the OCA. 

The Clerks of Courts of all concerned courts shall submit to the Docket and Clearance Division, Legal Office, OCA, a monthly report on surety companies with outstanding obligations on or before the 10th day of the succeeding month (SB Form No. 06-2004, Annex “B”).  The report shall specify the name of the surety company, the amount of bond, bond number, the case, number, case title, name of the accused or party in a case, date of order of forfeiture and status or action taken thereon, attaching in support thereto, the following:chan robles virtual law library

1. Judgment of forfeiture with the corresponding writ of execution;chan robles virtual law library

2. Subsequent motions/orders relative thereto; and 

3. Sheriff’s Return.cralaw:red

A. FIRST LEVEL AND SECOND LEVEL COURTS

A.1. In multiple sala stations, application for surety bonds shall be filed with the Office of the Clerk of Court.  In single sala station, it shall be filed with the Clerk of Court. The authorized agent of the surety company shall be required to submit the following:chan robles virtual law library

(a) Photocopy of the Certificate of Accreditation and Authority issued by the Court Administrator containing the photograph of the authorized agent after presentation of the original copy hereof as described in Title II, paragraph C; andchan robles virtual law library

(b)  Secretary Certificate containing the specimen signatures of the agents authorized by the company to transact business with the courts. 

A.2. All accredited surety companies shall be assigned a number by raffle, conducted every first working day of the month of August and February, by the Clerk of Court in single or multiple sala stations. A surety company that is accredited after the raffle shall be added to the list of raffled surety companies and assigned the next corresponding number. In case two (2) or more surety companies are simultaneously accredited after the raffle, they shall be added to the list in alphabetical order. 

A criminal case where the accused signifies his intention to post a surety bond shall be referred to the surety company according to its rank in the list. The assigned surety company shall have the first priority to negotiate with the accused, but the latter shall have the option to secure the services of another accredited bonding company of his choice in case of disagreement with the assigned surety company on the proposed terms and conditions of the bond. 

For example, Criminal Cases A, B, C, D and E shall be assigned, respectively, to Surety Companies ranked No. 1, 2, 3, 4, and 5 in the list. If the accused in Criminal Case “A” decides to avail of a surety bond, Surety Company No. 1 shall have the first priority to negotiate with the former. If the accused in Criminal Case “A” fails to come into terms with Surety Company No. 1, the accused shall have the option to secure the services of either Surety Company No. “2,” “3,” “4,” or “5,” following said order. If the accused comes into terms with Surety Company No. “2,” said surety company shall continue to have the right to negotiate with the accused in Criminal Case “B.” Surety Company No. 1, on the other hand, will have to wait for its turn in the next round. 

The same procedure shall be followed for surety bonds in civil/special proceedings cases.chan robles virtual law 

A.3. Before transmitting the surety bond for approval by the judge concerned, the Clerk of Court shall determine the completeness and authenticity of the bond and its supporting documents, more particularly the genuineness of the signatures of the authorized agents of the company.cralaw:red

A.4. The following requirements shall be attached to bond: 

A.4.a. Certified copy of a valid Certificate of Accreditation and Authority issued by the Office of the Court Administrator;chan robles virtual law library

A.4.b. Copy of the Certificate of Compliance with Circular No. 66 of the Insurance Commission duly certified by the Insurance Commission;

A.4.c. Proof of payment of legal fees under the Rules of Court and the documentary stamp tax (thirty centavos [P 0.30] on each four pesos [P4.00] or fractional part thereof, of the premium charged, pursuant to Section 187 Title VII of Rep. Act No. 8424) and Value Added Tax (VAT) under the National Internal Revenue Code;  chan robles virtual law library

A.4.d. Photocopy of the Certificate of Accreditation and Authority issued by the Court Administrator containing the photograph of the authorized agent (after presentation to the Clerk of Court of the original copy thereof as Copy of the Certificate of Accreditation and Authority containing the photograph of the agent); and chan robles virtual law library

A.4.e. Secretary Certificate containing the specimen signatures of the agents authorized to transact business with the courts. 

A.5. In criminal cases, the following additional documents shall be submitted:chanroblesvirtuallawlibrary

A.5.a. Photographs of the accused;

It shall be the obligation of the bonding company issuing the bond to attach four (4) sets of recently taken black and white 2x2 photographs (front, left and right profiles) of the accused on all copies of the corresponding bail bond to be issued or posted;

A.5.b. Original Copy of the Waiver of Appearance of accused under oath;

A.5.c. Original Copy of the Certificate of detention;

A.5.d. Certified true copy of the Information; and 

A.5.e. Certification from the Barangay Captain attesting to the real name of the accused, his actual residence in the barangay and attaching a location plan showing the residence of the accused.chan robles virtual law library

A.6. If the proposed surety bond is found to be in order and complies with all the above-listed requirements, the Clerk of Court shall transmit the bond to the judge concerned for his appropriate action. (SB Form No. 07-2004, Annex “C”). 

In case any of the requirements is not complied with, the bond shall be disapproved. The Clerk of Court shall immediately return the bond to the surety company, citing the reason for the disapproval. 

B.  COURT OF APPEALS AND SANDIGANBAYAN

B.1. The proposed surety bond shall be filed with the Judicial Records Division, which shall forward the same to the proper Division Clerk of Court.  The Division Clerk of Court shall determine the completeness and authenticity of the application and required documents submitted by the surety company for surety bond before the same is transmitted for approval by the Justice concerned.chan robles virtual law library

B.2. The Division Clerk of Court shall only accept application for surety bonds of a surety company duly accredited by the OCA, with a valid Certificate of Accreditation and Authority.cralaw:red

B.3. The Division Clerk of Court shall see to it that the bond is in order pursuant to the requirements enumerated under this title, paragraphs A.4 and A.5. 

In case any of the requirements is not complied with, the bond shall be disapproved. The Division Clerk of Court shall immediately return the same to the surety company which shall be informed of the disapproval. 

B.4. When the proposed bond is in order, the Division Clerk of Court shall transmit the bond to the Justice to whom the case was raffled, for his approval.chan robles virtual law library

C. COURT OF TAX APPEALSchan robles virtual law library

C.1.  Where, pursuant to the provisions of Section 11 of Republic Act 1125 in relation to Rule 12 of the Rules of the Court of Tax Appeals, suspension of the collection of tax is proper, and the taxpayer files an injunction bond in the form of surety for not more than double the amount of the tax liability, the Executive Clerk of Court shall determine the completeness and authenticity of the required documents submitted by the surety company, pursuant to the provisions of this title, paragraph A.4.  In criminal cases filed pursuant to Rep. Act No. 9282, the Executive Clerk of Court shall impose the submission of additional requirements provided under paragraph A.5 of this title. 

In case any of the requirements is not complied with, the bond shall be disapproved. The Executive Clerk of Court shall immediately return the bond to the taxpayer/applicant company, citing the reason for the disapproval. 

C2. When the application for injunction bond is in order, the Executive Clerk of Court shall transmit the application to the Court for approval.  The Court may impose additional requirements as it may deem proper and practicable under the circumstances. 

D. SUPREME COURT 

D.1. Upon receipt of the Resolution of the Supreme Court granting the issuance of a Writ of Preliminary Injunction subject to the posting of a bond, the petitioner shall submit the bond and other documents of compliance to the Judicial Records Office (JRO) within the period provided for in the Resolution. 

D.2. The JRO shall forward the bond and other documents of compliance to the concerned Clerk of Court or Division Clerk of Court.  The Clerk of Court or Division Clerk of Court shall determine the completeness and authenticity of the bond and required documents before placing them in the agenda for the approval of the Court. 

D.3. The Clerk of Court or Division Clerk of Court shall accept bonds only from a surety company that is duly accredited by the OCA, with a valid Certificate of Accreditation and Authority.cralaw:red

D.4. The Clerk of Court or Division Clerk of Court shall see to it that the bond is in order pursuant to the requirements enumerated under this title, paragraphs A.4 and A.5. 

In case any of the requirements is not complied with, the bond shall not be processed. The Clerk of Court shall immediately return the same to the petitioner who shall be given ten (10) days within which to comply with the Resolution of the Court. If the petitioner fails to comply, the Writ of Preliminary Injunction issued shall be rendered of no force and effect without the need to issue another Resolution. 

D.5. When the bond and other documents in compliance are in order, the Court shall approve the same through a Resolution.chan robles virtual law library

A.  Upon the issuance of the judgment of forfeiture, the Branch Clerk of Court shall immediately issue the corresponding writ of execution.  The writ of execution shall be forwarded, within five (5) days from the date of its issuance by the Branch Clerk of Court, to the Sheriff.  Within the day upon receipt of the writ, the Sheriff shall, by written notice, require the surety company to pay the obligation in relation to the forfeited judicial bond within fifteen (15) days from receipt thereof.  If the obligation remains unpaid after the lapse of fifteen (15) days, the Sheriff shall make a levy on the One Million Peso (P1,000,000.00) cash  deposit deposited at the Financial Management Division (FMO), OCA. 

The Sheriff concerned shall submit a return within thirty (30) days from implementation of the writ to the Clerk of Court pursuant to Section 14, Rule 39 of the 1997 Rules of Civil Procedure.chan robles virtual law library

B. In no case shall staggered payments of forfeited bonds be allowed, pursuant to Section 21, Rule 114 of the Revised Rules of Criminal Procedure. 

C. In case of reduction of the One Million Peso (P1,000,000.00) cash deposit in view of the levy made by the Sheriff, the Office of the Court Administrator shall notify the concerned surety company to deposit an amount equivalent to the amount levied from the cash deposit within fifteen (15) days from notice. Otherwise, the Certificate of Accreditation and Authority shall be suspended or revoked.chan robles virtual law library

D. Any interest earned from the cash deposit shall inure to the Judiciary Development Fund (JDF) as provided for in the En Banc Resolution of the Court dated 14 September 1999 (A.M. No. 99-8-01-SC).chan robles virtual law library

E. The aforementioned procedure shall likewise apply to the Supreme Court, Court of Appeals, Sandiganbayan and Court of Tax Appeals whenever applicable. 

VII. LIFETIME OF BONDS IN CRIMINAL AND CIVIL ACTIONS/SPECIAL PROCEEDINGS

Unless and until the Supreme Court directs otherwise, the lifetime or duration of the effectivity of any bond issued in criminal and civil actions/special proceedings, or in any proceeding or incident therein shall be from its approval by the court, until the action or proceeding is finally decided, resolved or terminated. This condition must be incorporated in the terms and condition of the bonding contract and shall bind the parties notwithstanding their failure to expressly state the same in the said contract or agreement. 

The surety company shall notify the court concerned and the parties to the action or proceeding of any act, event, or circumstances that may affect its business or operations, such as corporate rehabilitation; amendment of its articles of incorporation that shortens corporate lifetime, bankruptcy; insolvency; or issuance of writs of execution, attachment, or garnishment against it. The notice, which shall be given within ten (10) days from the occurrence of the act, event, or circumstance, shall have as attachments thereto, certified true copies or authenticated documents evidencing the same act, event or circumstance. 

The concerned Clerk of Court shall furnish the Docket and Clearance Division, Legal Office, OCA, with a copy of the final order of the court on the Motion to Withdraw as Bondsman filed by the surety company, within ten (10) days upon its issuance. 

VIII. CESSATION OF BONDING TRANSACTIONS WITH THE COURT BY THE SURETY COMPANY; WITHDRAWAL OF THE CASH DEPOSIT 

In the event the surety company decides to cease from engaging in bonding transactions with the court, it shall file a letter-request to that effect with the Court Administrator with a request for the withdrawal of the One Million Peso (P1,000,000.00) cash deposit/remaining balance.chan robles virtual law library

The withdrawal of the One Million Peso (P1,000.000.00) cash deposit/remaining balance shall be approved upon submission of the following to the Docket and Clearance Division, Legal Office, OCA: 

A. Sworn request for withdrawal of the cash deposit from the surety company addressed to the Court Administrator (SB Form No. 8-2004, Annex “D”);chan robles virtual law library

B. Board resolution issued by the surety company requesting for the withdrawal of the cash deposit; 

C. Clearances from all Clerks of Court where the surety company/authorized agents were authorized to transact surety business. The clearance shall indicate that the surety company/authorized agents have no outstanding obligations pertaining to judicial bonds;chan robles virtual law library

D. Sworn statement that the surety company has not been involved in any action or proceeding that may affect its business or operations, such as corporate rehabilitation; amendment of its articles of incorporation that shortens corporate lifetime, bankruptcy; insolvency; or issuance of writs of execution, attachment or garnishment against it; and 

E. The last Certificate of Accreditation and Authority issued to the surety company by the Docket and Clearance Division, Legal Office, OCA.chan robles virtual law library

Upon submission of the foregoing requirements, the Court Administrator shall issue in favor of the surety company an authority to withdraw its outstanding cash deposit from the Financial Management Office, OCA, which in turn, shall prepare the necessary voucher for the withdrawal of the fund from the Land Bank of the Philippines.

IX. TRANSITORY PROVISION chan robles virtual law library

An application for Certificate of Accreditation and Authority filed by a surety company after the effectivity hereof shall, if approved, be considered valid for the remainder of the six-month period. 

X. REPEALING CLAUSE chan robles virtual law library

All circulars and issuances inconsistent herewith are deemed superseded or amended accordingly.

chan robles virtual law library