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By Jomar Canlas Reporter
THE Court of Appeals has
overturned a lower court ruling that denied a group of Pacific Plan
policy holders a say in rehabilitating the company.
In a decision penned by Associate
Justice Japar Dimaampao and promulgated on August 28, the Court of
Appeals’ 5th Division ordered the Makati Regional Trial Court to
let the plan holders led by the PEP (Parents Enabling Parents)
Coalition present evidence in the case involving the rehabilitation
of Pacific Plan Inc.
The judge hearing the case, Romeo
Barza, had said the PEP Coalition could not oppose the
rehabilitation of Pacific Plans.
The CA rebuked the judge, saying
he should consider the hard-earned money the plan holders had raised
for their children’s education.
The appellate court dismissed the
accusation of Pacific Plans that PEP and the Piezas Group (Celine
Piezas, Pura Angela Manalo, Mercedes Guerrero and Jose Mari Gamboa)
went forum shopping with other tribunals.
In an October 10, 2006 decision,
Justice Dimaampao had already said the Makati court it erred in not
receiving evidence, which would deprive the plan holders of their
rights.
With the new CA ruling, the
Makati court is compelled to accept evidence.
Dimaampao said the Makati court
should have considered the findings of the Securities and Exchange
Commission (SEC) which has the expertise to tell whether Pacific
Plans was liquid or not.
The SEC said the corporation was
liquid enough and did not need rehabilitation.
The court ruled that Pacific
Plans was liquid and would be able to pay its plan holders until
2014. It said its trust fund exceeds its projected benefits by
P1,209,062,409.26 which does not even include interest.
In a related development, the
Bangko Sentral ng Pilipinas said it would penalize the Yuchengco-controlled
Rizal Commercial Banking Corp. (RCBC) for “lack of prudence” in
managing the Pacific Plans trust funds.
In Resolution No. 574 dated May
17, 2007, the Monetary Board—the policy-making body of the central
bank also warned RCBC and the RCBC-Trust and Investment Division and
said that committing “similar acts on lack of prudence” in
managing trust funds required under Section X401 of the manual of
regulations for banks would mean stiffer sanctions.
Under Part 4 of the manual of
regulations for banks, violation committed by banks on any provision
of the section pertaining to trust, other fiduciary business and
investment management activities, would entail a fine of up to
P10,000 a day from the day the violation was committed.
The PEP Coalition said its
members felt vindicated by the Monetary Board resolution.
“The BSP findings and resulting
Monetary Board resolution confirmed our charges on the collusion
among RCBC, PPI and the Yuchengcos,” PEP said in a statement.
On August 26, 2005, PEP filed
with the BSP a complaint against RCBC on the grounds that the bank
violated Section 80 of the General Banking Act of 2000 and claimed
that RCBC did not have adequate safeguard or compliance with
interlocking relationship between trustee and trustor.
The group also complained about
the “dismal performance” of RCBC Trust as a fiduciary and
allegedly the trust funds were “heavily invested in losing
stocks.”
The group accused RCBC of
investing in corporations because these were wholly or partly owned
by the Yuchengco Group of Companies.
Included in the complaint are
allegations that RCBC lent the trust funds to “unnamed
borrowers” like Uniwide and purchase zero-coupon US
dollar-denominated bonds issued by the National Power Corp. (Napocor).
RCBC said it “welcomed” the
BSP resolution. However, it maintains that the central bank did not
say that the trust fund was not mismanaged.
“While we differ with the
findings of the BSP, we emphasize that the BSP has not made any
findings of “mismanagement” by RCBC Trust. In particular, there
were no findings of mismanagement with respect to any allegations in
the complaint of PEPCI,” the bank said in a statement.
--With Likha Cuevas-Miel
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