Republic of the Philippines
REGIONAL TRIAL COURT
First (1st) Judicial Region
Tagudin, Ilocos Sur
Branch 25

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P E T I T I O N

PETITIONER Philippine Deposit Insurance Corporation (PDIC), by counsel, unto this Honorable Court, respectfully avers —

1. Petitioner, a government instrumentality, with office address at the SSS Building, 6782 Ayala Avenue corner V.A. Rufino Street, 1228 Makati City, created and existing under and by virtue of Republic Act No. 3591, as amended, is the designated Statutory Liquidator of the RURAL BANK OF TAGUDIN (ILOCOS SUR), INC.(“RB TAGUDIN”, for brevity).

2. Prior to its closure, RB TAGUDIN was a bank organized and existing in accordance with the laws of the Republic of the Philippines with principal business address located at National Highway corner San Adriano Street, Barangay Quirino, Tagudin, Ilocos Sur.

3. On 07 April 2011, pursuant to Monetary Board Resolution No. 514 of the Bangko Sentral ng Pilipinas (BSP), the Monetary Board prohibited RB TAGUDIN from doing business in the Philippines and placed it under the receivership of petitioner, on the following grounds:

   “On the basis of the examination findings as of 30 September 2010, as reported by the Integrated Supervision Department II, in a memorandum dated 18 March 2011, which findings showed that the Rural Bank of Tagudin (Ilocos Sur), Inc. (RB Tagudin): (a) has willfully violated a cease and desist order under Section 37 of Republic Act (R.A.) No. 7653 (The New Central Bank Act) that has become final, involving acts or transactions which amount to fraud or a dissipation of the assets of the institution; and (b) cannot continue in business without involving probable losses to its depositors and creditors, and considering the failure of its Board of Directors/management to restore the bank’s financial health and viability despite considerable time given to address its financial problems, and that the ban had been accorded due process, the Board, in accordance with Section 30 of R.A. No. 7653, decided as follows: To prohibit RB Tagudin from doing business in the Philippines and to place its assets and affairs under receivership; and To designate the Philippine Deposit Insurance Corporation as Receiver of the bank.”

   The photocopy of Monetary Board Resolution No. 514 dated 07 April 2011 is attached hereto as ANNEX “A”.

4. Consistent with, and on the strength of the aforesaid Resolution, petitioner took over the assets and affairs of RB TAGUDIN on 08 April 2011.

5. Under Section 30 of Republic Act 7653, otherwise known as “The New Central Bank Act”, petitioner, as the Receiver of RB TAGUDIN, is mandated to determine whether the institution may be rehabilitated or otherwise placed in such a condition so that it may be permitted to resume business with safety to its depositors and creditors and the general public or be placed under liquidation.

6. Pursuant thereto, on 21 November 2011, petitioner reported to the Monetary Board of the BSP that RB TAGUDIN, at its present financial condition, cannot be rehabilitated nor can it resume business with safety to its depositors, creditors and the general public. Photocopies of the letter dated 21 November 2011 and the Receivership Report are hereto attached as ANNEXES “B” and “C”, respectively.

7. On 08 December 2011, the Monetary Board of the BSP issued Resolution No. 1833 directing herein petitioner to proceed with the liquidation of RB TAGUDIN, the complete text of which reads:

   “On the basis of the report on the receivership operations of the Rural Bank of Tagudin (Ilocos Sur), Inc. (RB Tagudin), prepared by the Philippine Deposit Insurance Corporation (PDIC), as receiver, and transmitted by Mr. Valentin A. Araneta, President, PDIC, in a letter dated 21 November 2011, that the PDIC determined that RB Tagudin at its present condition, cannot be rehabilitated nor permitted to resume business with safety to its depositors, creditors, and the general public, the Board, in accordance with Section 30 of Republic Act No. 7653 (The New Central Bank Act), decided as follows: To instruct Management to notify in writing the Board of Directors of RB Tagudin of PDIC’s findings; and To direct PDIC to proceed with the liquidation of the aforementioned bank.”

   The photocopy of the Monetary Board Resolution No. 1833 is hereto attached as ANNEX “D”.

8. On 21 December 2011, in compliance with Section 30, supra and Resolution No. 1833 of the Monetary Board, BSP notified in writing the members of the Board of Directors of RB TAGUDIN, through Mr. Wilson T. Flores, of the Monetary Board’s decision to proceed with the Bank’s liquidation. Photocopies of the letter-notification as well as the proof of service thereof via LBC are hereto attached as ANNEXES “E” and “E-1”.

9. This petition is being filed pursuant to Section 30, supra, the relevant portion of which states that-

   “x x x The receiver shall: (1) file ex parte with the proper regional trial court, and without requirement of prior notice or any action, a petition for assistance in the liquidation of the institution pursuant to a liquidation plan adopted by the Philippine Deposit Insurance Corporation for general application to all closed banks.” x x x Upon acquiring jurisdiction, the court shall upon motion of the receiver after due notice, adjudicate disputed claims against the institution, assist the enforcement of individual liabilities of the stockholders, directors and officers and decide on other issues as may be material to implement the liquidation plan adopted. The receiver shall pay the cost of the proceedings from the assets of the institution.” (Underscoring and emphasis supplied.)

10. Consistent therewith, herein petitioner hereby submits a copy of the Master Receivership/Liquidation Plan for Closed Banks, which was duly adopted and approved by its Board of Directors in Resolution No. 2007-12-07 dated 20 December 2007 for general application in the liquidation of all closed banking institutions. The photocopy of the Master Receivership/Liquidation Plan for Closed Banks is attached hereto as ANNEX “F”.

11. Petitioner anticipates that in the course of the liquidation of RB TAGUDIN, disputed claims, issues and other matters material or relevant to the liquidation of RB TAGUDIN may arise. Thus, pursuant to the provision of Section 30, supra, herein petitioner seeks the assistance of the Honorable Court in the resolution of the disputed claims and relevant issues.

12. Insofar as relevant to this petition, the Supreme Court held in Pacific Banking Corporation Employees Organization vs. Court of Appeals, et al. (242 SCRA 492):

    “A liquidation proceeding is a single proceeding which consists of a number of cases properly classified as claims. It is basically a two-phased proceeding. The first phase is concerned with the approval and disapproval of claims. Upon the approval of the petition seeking the assistance of the court in the liquidation of a closed entity, all money claims against the bank are required to be filed with the liquidation court. This phase may end with the declaration by the court that the claim is not proper or without basis. x x x The second phase involves the approval of the court of the distribution plan prepared by the duly appointed liquidator. x x x The order finally disposes of the issue of how much property is available for disposal. Moreover, it ushers in the final phase of the liquidation proceeding, payment of all allowed claims in accordance with the order of legal priority and the approved liquidation plan.” (Underscoring and emphasis supplied.)

P R A Y E R

WHEREFORE, premises considered, it is respectfully prayed that the Honorable Court -

1. After finding the instant Petition for Assistance in the Liquidation of RB TAGUDIN to be sufficient in form and substance, issue an Order:

   1. DIRECTING the petitioner PDIC to cause the posting in three (3) public places and the one-time publication in a newspaper of general circulation of the Honorable Court’s Order;

   2. SETTING the date and time for the initial hearing; and

   3. DIRECTING those who may have a claim against the assets of the Bank to file their respective claims with the petitioner within ninety (90) days from the date of publication of the above-mentioned Order.

2. Thereafter, upon submission of proof of jurisdictional requirements, that an Order be issued by the Honorable Court GIVING DUE COURSE to the instant Petition for Assistance in the Liquidation of RB TAGUDIN.

Such other relief and remedies as are just and equitable under the circumstances are likewise prayed for.

Makati City for Tagudin, Ilocos Sur, 16 April 2012.

OFFICE OF THE GENERAL COUNSEL
PHILIPPINE DEPOSIT INSURANCE CORPORATION
6782 Ayala Avenue cor. Rufino Street, SSS Bldg., Makati City
Tel. No. 8414000; Fax No. 8414136
www.pdic.gov.ph

Republic of the Philippines)
Makati City   ) S.S.

VERIFICATION AND CERTIFICATION OF NON FORUM SHOPPING

I, TEODORO JOSE D. HIRANG, Filipino, of legal age, with office address at the 5th floor, PDIC Ayala Extension Office, SSS Building, Ayala Avenue corner V.A. Rufino Street, Makati City, after having been duly sworn in accordance with law, do hereby depose and state:

1. I am the Assistant Vice-President of the Receivership and Bank Management Department (RBMD) IV, which is in charge of the over-all supervision of the liquidation of RB TAGUDIN. As such, I have the authority to sign and verify pleadings pursuant to PDIC Board Resolution No. 2005-01-017 (ANNEX “A - Verification”);

2. I have caused the preparation of the foregoing petition entitled “Petition for Assistance in the Liquidation of Rural Bank of Tagudin (Ilocos Sur), Inc.”; and have read the same and that the allegations therein contained are true and correct based on authentic records of the bank; and that I have not heretofore directed the commencement of any other action or proceeding involving the same issues in the Supreme Court, the Court of Appeals, or any other tribunal or agency;

3. To the best of my knowledge, no other action or proceeding is pending in the Supreme Court, or any other tribunal or agency;

4. And should I thereafter learn that a similar action or proceeding has been file or is pending before the Supreme Court, the Court of Appeals, or any other tribunal or agency, I undertake to report that fact within five (5) days therefrom to this Honorable Office.

SUBSCRIBED AND SWORN to before me this _____ day of April 2012, in the City of Makati, affiant exhibiting to me his Employee I.D. No. _____ issued by the PDIC.

Doc. No. _____
Page No. _____
Book No. _____
Series of 2012.