G.R. No.
76118 March 30, 1993 actions of the Monetary Board which are
THE CENTRAL BANK OF THE PHILIPPINES and
RAMON V. TIAOQUI, petitioners, vs. COURT
OF APPEALS and TRIUMPH SAVINGS BANK,
respondents.
The first issue raised before Us is whether
absence of prior notice and hearing may be
considered acts of arbitrariness and bad
faith sufficient to annul a Monetary Board
resolution enjoining a bank from doing
business and placing it under receivership.
Otherwise stated, is absence of prior notice
and hearing constitutive of acts of
arbitrariness and bad faith?
Under Sec. 29 of R.A. 265, the Central Bank,
through the Monetary Board, is vested with
exclusive authority to assess, evaluate and
determine the condition of any bank, and
finding such condition to be one of
insolvency, or that its continuance in
business would involve probable loss to its
depositors or creditors, forbid the bank or
non-bank financial institution to do business
in the Philippines; and shall designate an
official of the CB or other competent person
as receiver to immediately take charge of its
assets and liabilities.
The fourth paragraph, which was then in
effect at the time the action was commenced,
allows the filing of a case to set aside the
consequences of a prior hearing: bank runs
tainted with arbitrariness and bad faith.
Contrary to the notion of private respondent,
Sec. 29 does not contemplate prior notice
and hearing before a bank may be directed to
stop operations and placed under
receivership. When par. 4 (now par. 5, as
amended by E.O. 289) provides for the filing
of a case within ten (10) days after the
receiver takes charge of the assets of the
bank, it is unmistakable that the assailed
actions should precede the filing of the case.
Plainly, the legislature could not have
intended to authorize "no prior notice and
hearing" in the closure of the bank and at the
same time allow a suit to annul it on the basis
of absence thereof.
This "close now and hear later" scheme is
grounded on practical and legal
considerations to prevent unwarranted
dissipation of the bank's assets and as a valid
exercise of police power to protect the
depositors, creditors, stockholders and the
general public.
In Rural Bank of Buhi, Inc. v. Court of
Appeals, We stated that
. . . due process does not necessarily require
a prior hearing; a hearing or an opportunity
to be heard may be subsequent to the
closure. One can just imagine the dire
would be the order of the day, resulting in
panic and hysteria. In the process, fortunes
may be wiped out and disillusionment will
run the gamut of the entire banking
community.
We stressed in Central Bank of the
Philippines v. Court of Appeals that
. . . the banking business is properly subject
to reasonable regulation under the police
power of the state because of its nature and
relation to the fiscal affairs of the people and
the revenues of the state (9 CJS 32). Banks
are affected with public interest because they
receive funds from the general public in the
form of deposits. Due to the nature of their
transactions and functions, a fiduciary
relationship is created between the banking
institutions and their depositors. Therefore,
banks are under the obligation to treat with
meticulous care and utmost fidelity the
accounts of those who have reposed their
trust and confidence in them (Simex
International [Manila], Inc., v. Court of
Appeals, 183 SCRA 360 [1990]).
It is then the Government's responsibility to
see to it that the financial interests of those
who deal with the banks and banking
institutions, as depositors or otherwise, are
protected. In this country, that task is
delegated to the Central Bank which,
pursuant to its Charter (R.A. 265, as
amended, and at present RA7653 [The New
Central Bank Act]), is authorized to
administer the monetary, banking and credit
system of the Philippines. Under both the
1973 and 1987 Constitutions, the Central
Bank is tasked with providing policy
direction in the areas of money, banking and
credit; corollarily, it shall have supervision
over the operations of banks (Sec. 14, Art. XV,
1973 Constitution, and Sec. 20, Art. XII, 1987
Constitution). Under its charter, the CB is
further authorized to take the necessary
steps against any banking institution if its
continued operation would cause prejudice
to its depositors, creditors and the general
public as well.
This power has been expressly recognized by
this Court. In Philippine Veterans Bank
Employees Union-NUBE v. Philippine
Veterans Banks (189 SCRA 14 [1990], this
Court held that:
. . . [u]nless adequate and determined
efforts are taken by the government against
distressed and mismanaged banks, public
faith in the banking system is certain to
deteriorate to the prejudice of the national
economy itself, not to mention the losses
suffered by the bank depositors, creditors,
and stockholders, who all deserve the
protection of the government. The
government cannot simply cross its arms
while the assets of a bank are being depleted
through mismanagement or irregularities. It
is the duty of the Central Bank in such an
event to step in and salvage the remaining
resources of the bank so that they may not
continue to be dissipated or plundered by
those entrusted with their management.
G.R. No. 189571, January 21, 2015
THE HONORABLE MONETARY BOARD AND
GAIL U. FULE, DIRECTOR, SUPERVISION AND
EXAMINATION DEPARTMENT II, AND
BANGKO SENTRAL NG PILIPINAS,
Petitioners, v. PHILIPPINE VETERANS BANK,
Respondent.
PERALTA, J.
Ergo, the Court, in CJH Development
Corporation v. Bureau of Internal Revenue,10
held that in the same manner that court
decisions cannot be the proper subjects of a
petition for declaratory relief, decisions of
quasi-judicial agencies cannot be subjects of
a petition for declaratory relief for the simple
reason that if a party is not agreeable to a
decision either on questions of law or of fact,
it may avail of the various remedies provided
by the Rules of Court.
In view of the foregoing, the decision of the
BSP Monetary Board cannot be a proper
subject matter for a petition for declaratory
relief since it was issued by the BSP Monetary
Board in the exercise of its quasi-judicial
powers or functions.
The authority of the petitioners to issue the
questioned MB Resolution emanated from its
powers under Section 3711 of RA No. 765312
and Section 6613 of RA No. 879114 to
impose, at its discretion, administrative
sanctions, upon any bank for violation of any
banking law.
The nature of the BSP Monetary Board as a
quasi-judicial agency, and the character of its
determination of whether or not appropriate
sanctions may be imposed upon erring banks,
as an exercise of quasi-judicial function, have
been recognized by this Court in the case of
United Coconut Planters Bank v. E. Ganzon,
Inc.,15 to wit:
A perusal of Section 9(3) of Batas Pambansa
Blg. 129, as amended, and Section 1, Rule 43
of the 1997 Rules of Civil Procedure reveals
that the BSP Monetary Board is not included
among the quasi-judicial agencies explicitly
named therein, whose final judgments,
orders, resolutions or awards are appealable
to the Court of Appeals. Such omission,
however, does not necessarily mean that the
Court of Appeals has no appellate jurisdiction
over the judgments, orders, resolutions, or
awards of the BSP Monetary Board.
It bears stressing that Section 9(3) of Batas
Pambansa Blg. 129, as amended, on the
appellate jurisdiction of the Court of Appeals,
generally refers to quasi-judicial agencies,
instrumentalities, boards or commissions.
The use of the word including in the said
provision, prior to the naming of several
quasi-judicial agencies, necessarily conveys
the very idea of non-exclusivity of the
enumeration. The principle of expressio unius
est exclusio alterius does not apply where
other circumstances indicate that the
enumeration was not intended to be
exclusive, or where the enumeration is by
way of example only.
Similarly, Section 1, Rule 43 of the 1997
Revised Rules of Civil Procedure merely
mentions several quasi-judicial agencies
without exclusivity in the phraseology. The
enumeration of the agencies therein
mentioned is not exclusive. The introductory
phrase [a]mong these agencies are
preceding the enumeration of specific quasi-
judicial agencies only highlights the fact that
the list is not meant to be exclusive or
conclusive. Further, the overture stresses and
acknowledges the existence of other quasi-
judicial agencies not included in the
enumeration but should be deemed
included.
A quasi-judicial agency or body is an organ of
government other than a court and other
than a legislature, which affects the rights of others, needed in its examination, to impose
private parties through either adjudication or fines and other sanctions and to issue cease
rule-making. The very definition of an and desist order. Section 37 of Republic Act
administrative agency includes its being No. 7653, in particular, explicitly provides
vested with quasi-judicial powers. The ever that the BSP Monetary Board shall exercise its
increasing variety of powers and functions discretion in determining whether
given to administrative agencies recognizes administrative sanctions should be imposed
the need for the active intervention of on banks and quasi-banks, which necessarily
administrative agencies in matters calling for implies that the BSP Monetary Board must
technical knowledge and speed in countless conduct some form of investigation or
controversies which cannot possibly be hearing regarding the same.16
handled by regular courts. A quasi-judicial
function is a term which applies to the
action, discretion, etc. of public
administrative officers or bodies, who are
required to investigate facts, or ascertain the
existence of facts, hold hearings, and draw
conclusions from them, as a basis for their
official action and to exercise discretion of a
judicial nature.
Undoubtedly, the BSP Monetary Board is a
quasi-judicial agency exercising quasi-judicial
powers or functions. As aptly observed by the
Court of Appeals, the BSP Monetary Board is
an independent central monetary authority
and a body corporate with fiscal and
administrative autonomy, mandated to
provide policy directions in the areas of
money, banking, and credit. It has the power
to issue subpoena, to sue for contempt those
refusing to obey the subpoena without
justifiable reason, to administer oaths and
compel presentation of books, records and