Rizal Commercial Banking Corporation vs. Intermediate Appellate Court and BF Homes G.R. No. 74851 (December 9, 1999) Facts: Petitioner RCBC is a mortgagor-creditor of the party respondent BF Homes. BF Homes, being a distressed firm, filed before the Securities and Exchange Commission a Petition for Rehabilitation and for Declaration of Suspension of Payments. Consequently, RCBC requested the sheriff of Rizal to levy on execution the properties of party respondent, and consequently obtained favorable judgment. RCBC being the highest bidder during the public auction is now seeking for the transfer certificate of titles from the Register of Deeds issued in its name. It is worthy to note that it was on October 26, 1984 that RCBC obtained favor over the execution of the respondent’s properties, and it was only on March 18, 1985 that a Management Committee was organized by the SEC for BF Homes. Issue: Whether or not the Court may depart from the words of the law which clearly provides that a creditor may levy execution on a firm’s properties when such execution precedes SEC’s organization of a Management Committee to act as its receiver. Held: PD 209-A states that suspension of claims against a corporation under rehabilitation is counted or figured up only upon the appointment of a management committee or a rehabilitation receiver. The holding that suspension of actions for claims against a corporation under rehabilitation takes effect as soon as the application or a petition for rehabilitation is filed with the SEC — may, to some, be more logical and wise but unfortunately, such is incongruent with the clear language of the law. Suspension of actions for claims commences only
Rizal Commercial Banking Corporation vs. Intermediate Appellate
Court and BF HomesG.R. No. 74851 (December 9, 1999)Facts:Petitioner
RCBC is a mortgagor-creditor of the party respondent BF Homes. BF
Homes, being a distressed firm, filed before the Securities and
Exchange Commission a Petition for Rehabilitation and for
Declaration of Suspension of Payments. Consequently, RCBC requested
the sheriff of Rizal to levy on execution the properties of party
respondent, and consequently obtained favorable judgment. RCBC
being the highest bidder during the public auction is now seeking
for the transfer certificate of titles from the Register of Deeds
issued in its name. It is worthy to note that it was on October 26,
1984 that RCBC obtained favor over the execution of the respondents
properties, and it was only on March 18, 1985 that a Management
Committee was organized by the SEC for BF Homes.Issue:Whether or
not the Court may depart from the words of the law which clearly
provides that a creditor may levy execution on a firms properties
when such execution precedes SECs organization of a Management
Committee to act as its receiver.Held:PD 209-A states that
suspension of claims against a corporation under rehabilitation is
counted or figured up only upon the appointment of a management
committee or a rehabilitation receiver. The holding that suspension
of actions for claims against a corporation under rehabilitation
takes effect as soon as the application or a petition for
rehabilitation is filed with the SEC may, to some, be more logical
and wise but unfortunately, such is incongruent with the clear
language of the law. Suspension of actions for claims commences
only from the time a management committee or receiver is appointed
by the SEC. Petitioner RCBC rightfully moved for the extrajudicial
foreclosure of its mortgage on October 26, 1984 because a
management committee was not appointed by the SEC until March 18,
1985.No matter how practical and noble a reason would be, in order
to depart from the words of the law stated in clear and unambiguous
manner, would be to encroach upon legislative prerogative to define
the wisdom of the law. Such is plainly judicial legislation.
