SC asked to halt CA order on Export Bank assets


Posted at May 18 2012 02:25 PM | Updated as of May 18 2012 10:25 PM

MANILA, Philippines - The Supreme Court has been asked to enjoin the implementation of the Court of Appeals' order to stop the seizure of the assets and properties of Export and Industry Bank (EIB), amid a pending case holding the bank liable for unauthorized sale of over P1.46 billion worth of shares of several firms in DM Consunji Inc. (DMCI).

The petitioners - Pacific Rehouse Corporation, Pacific Concorde Corporation, Mizpah Holdings, Inc., Forum Holdings Corporation and East Asia Oil Company Inc. - asked the SC to set aside the appelate court's April 26 ruling that nullified two orders issued by a court in Makati last year.

The case stemmed from allegations of the 5 companies regarding the unauthorized sale of said DMCI shares made by their broker, EIB Securities, Inc.

The Makati RTC issued an order on August 26, 2011 directing the garnishment of P1.47 billion, representing 32.18 million DMCI shares at P45.55 per share against EIB Securities. It also authorized the sheriff to acquire the shares from the Philippine Stock Exchange at the cost of EIB Securities Inc. and Export Bank.

This was supposed to cover all holding money, properties, and personal belongings owned by Export Bank and EIB Securities.

In its 38-page petition review, the petitioners argued that the CA should have stopped EIB's petition for violating the rule against forum shopping.

"One of the grounds invoked by petitioners for the dismissal of the the filing by  respondent bank and its wholly-owned subsidiary, EIB Securities, of multiple petitions both praying for a TRO and a writ of preliminary injunction and for setting aside the orders...of the RTC of Manila. The Court of Appeals, however,totally ignored this issue and did not bother to rule on it in its assailed decision," the petition said.

The petitioners also claimed EIB tried to transfer its properties and shares in Arthaland Corporation while the case was pending before the CA.

"Unless respondent Exportbank is enjoined from transferring its properties, it will continue to do so and the bank's depositors and creditors including petitioners who are entitled  to the return of their 32,180,000 DMCI shares pursuant to the final and executory decision of this Honorable Court...would be deprived of their right to be paid their credits n the liquidation of Exportbank should the PDIC decide that the bank can no longer be rehabilitated," the petitioners added.

EIB is currently under receivership of the Philippine Deposit Insurance Corporation (PDIC). EIB was placed under receivership by the Bangko Sentral ng Pilipinas due to its inability to service maturing time deposits because of insufficient liquidity.

EIB had P15.98 billion in deposits covering 50,052 deposit accounts when it was ordered closed.