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State Investment v. CA

The document summarizes a case between State Investment House (petitioner) vs. the Court of Appeals, Securities & Exchange Commission, and Philippine Blooming Mills (respondents). State Investment House filed a motion to declare its first mortgage lien on Philippine Blooming Mills property as highest preference, which was denied. On appeal, the Court of Appeals and Supreme Court affirmed the denial. The issue is whether State Investment House, as mortgagee, may be declared to have highest preference over the property despite rehabilitation proceedings before the SEC. The Supreme Court held that in rehabilitation proceedings, the Civil Code provisions on credit preference apply, and State Investment House's claim was referred to the SEC for determination of preference under the law.

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130 views1 page

State Investment v. CA

The document summarizes a case between State Investment House (petitioner) vs. the Court of Appeals, Securities & Exchange Commission, and Philippine Blooming Mills (respondents). State Investment House filed a motion to declare its first mortgage lien on Philippine Blooming Mills property as highest preference, which was denied. On appeal, the Court of Appeals and Supreme Court affirmed the denial. The issue is whether State Investment House, as mortgagee, may be declared to have highest preference over the property despite rehabilitation proceedings before the SEC. The Supreme Court held that in rehabilitation proceedings, the Civil Code provisions on credit preference apply, and State Investment House's claim was referred to the SEC for determination of preference under the law.

Uploaded by

Jm Eje
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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[G.R. No. 123240. August 11, 1997] STATE INVESTMENT HOUSE, petitioner, vs.

THE COURT OF APPEALS, the SECURITIES & EXCHANGE COMMISION and PHILIPPINE BLOOMING MILLS, CO., INC., respondents.

FACTS Petitioner filed with the SEC in the pending action for settlement of claims of the various creditors of respondent Philippine Blooming Mills Co., Inc. (PBM) was a Motion to Declare and Confirm the Highest Preference of Movants First Mortgage Lien. The SEC hearing officer denied said motion. Petitioner appealed this denial to the SEC en banc, which dismissed the appeal. Then on appeal before respondent court, the Court of Appeals affirmed the SEC decision. Finally, finding no reversible error committed by respondent Court of Appeals, we denied due course to the instant petition. Now, the present motion for reconsideration. ISSUE Whether or not petitioner SIHI, as mortgagee of respondent PBM, may be declared to have highest preference over specific property subject of the mortgage, despite the pendency of rehabilitation/receivership proceeding pending before the SEC. HELD In any rehabilitation/receivership proceedings where claims of several creditors shall have to be resolved, the provisions of the Title XIX of the Civil Code Concurrence and Preference of Credits applies. In the present petition, the foreclosure sale of the mortgaged property was declared by this Court in G.R. No. 87053 to be totally null and void, and petitioner SIHIs claim was accordingly referred to the SEC for determination of the preferences or priorities under the law in the settlement of claims of firms under receivership or liquidation. Hence, unlike in RCBC, in the present case there are no longer any previous foreclosure proceedings to speak of. Also, in the present petition, the factual considerations in the issuance of the pertinent rehabilitation plan where SIHIs claim had been reportedly included in the schedule of payment finds relevance. This was not true in the RCBC Case.

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