CA stops seizure of P1.4B from Export Bank

The Court of Appeals (CA) has stopped a Makati court from seizing P1.4 billion worth of properties from the Export and Industry Bank (EIB) which was accused of unauthorized sales of stock shares of several firms in D.M. Consunji Inc (DMCI).

 

In a decision written by Associate Justice Mario Lopez last April 26, the appeals court voted 3-2 to nullify two orders from the Makati Regional Trial Court Branch 66 dated July 29, 2011 and August 26, 2011.

 

The Makati court decisions ordered the EIB to return P1,465,799,000 to the five respondents, namely Pacific Rehouse Corporation, Pacific Concorde Corporation, Mizpah Holdings, Inc., Forum Holdings Corporation, and East Asia Oil Company, Inc.

 

The amount to be returned is equal to the 32,180,000 shares bought by the respondents from DMCI at P45.55 per share through EIB's brokerage firm, EIB Securities Inc (E-Securities).

 

The trial court said the amount that EIB owed the respondents must come from its "holding moneys, properties of any and all kinds, real and personal belonging to or owned by defendant E-Securities and/or Export and Industry Bank, Inc. in such amount as may be sufficient to acquire DMCI shares."

 

To oppose the trial court decisions, the EIB elevated the case to the Court of Appeals and sought the issuance of a writ of preliminary injunction (WPI) on September 2 last year.

 

Despite the CA petition, the Makati court on November 29, 2011 still directed its sheriff to implement that acquisition order on August 26, 2011 and continue with the garnishment of all property belonging to E-Securities.

 

In its latest ruling, the CA said the trial court should not have challenged the CA ruling given that the latter was a higher court.

 

“The disquisition of the RTC, which is a declaration against the validity of a high court’s order, is a blatant disregard of the principle of hierarchy of courts,” the CA ruling said.

 

The CA said instead of insisting on implementing its August 26, 2011 ruling on garnishment of P1.4 billion, the Makati court should have first "assailed the validity of the WPI with this [CA] division or the Supreme Court."

 

“Thus, the supervening orders of the RTC in contravention of the WPI are void,” the appeals court said.

 

The CA stressed that the WPI it issued remains in "full force and effect" unless revoked or ratified.

 

Concurring with the ponencia of Lopez were Associate Justices Amy Lazaro-Javier and Vicente Veloso while Associate Justices Magdangal de Leon and Socorro Inting dissented. –KG, GMA News