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    GSIS vs. CA Digest

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    Caitlin Kintanar
    This document discusses a case between GSIS, Domsat, and various banks regarding a loan and surety agreement. GSIS guaranteed a loan Domsat received from banks to lease a satellite, but refused to pay when Domsat defaulted, claiming the funds were misused. GSIS wants to examine Domsat's bank deposits to determine liability, citing one law, while the banks cite another. The court rules that the second law on foreign currency deposits applies in this case involving US dollars. It dismisses GSIS's petition, finding the banks cannot legally disclose deposits without the depositor's consent under this law.

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    © All Rights Reserved
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    GSIS vs. CA Digest

    Uploaded by

    Caitlin Kintanar
    218 views1 page
    This document discusses a case between GSIS, Domsat, and various banks regarding a loan and surety agreement. GSIS guaranteed a loan Domsat received from banks to lease a satellite, but refused to pay when Domsat defaulted, claiming the funds were misused. GSIS wants to examine Domsat's bank deposits to determine liability, citing one law, while the banks cite another. The court rules that the second law on foreign currency deposits applies in this case involving US dollars. It dismisses GSIS's petition, finding the banks cannot legally disclose deposits without the depositor's consent under this law.

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    This document discusses a case between GSIS, Domsat, and various banks regarding a loan and surety agreement. GSIS guaranteed a loan Domsat received from banks to lease a satellite, but refused to pay when Domsat defaulted, claiming the funds were misused. GSIS wants to examine Domsat's bank deposits to determine liability, citing one law, while the banks cite another. The court rules that the second law on foreign currency deposits applies in this case involving US dollars. It dismisses GSIS's petition, finding the banks cannot legally disclose deposits without the depositor's consent under this law.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    218 views1 page

    GSIS vs. CA Digest

    Uploaded by

    Caitlin Kintanar
    This document discusses a case between GSIS, Domsat, and various banks regarding a loan and surety agreement. GSIS guaranteed a loan Domsat received from banks to lease a satellite, but refused to pay when Domsat defaulted, claiming the funds were misused. GSIS wants to examine Domsat's bank deposits to determine liability, citing one law, while the banks cite another. The court rules that the second law on foreign currency deposits applies in this case involving US dollars. It dismisses GSIS's petition, finding the banks cannot legally disclose deposits without the depositor's consent under this law.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    GSIS vs.

    CA Domsat denies the allegations of GSIS and reiterates that it


    did not give a categorical or affirmative written consent or
    The controversy originated from a surety agreement by which permission to GSIS to examine its bank statements with
    Domsat obtained a surety bond from GSIS to secure the Westmont Bank.
    payment of the loan from the Banks.
    The Banks maintain that Republic Act No. 1405 is not the
    The obligation contained to guarantee the repayment of the applicable law in the instant case because the Domsat deposit
    principal and interest on the loan granted the PRINCIPAL to is a foreign currency deposit, thus covered by Republic Act
    be used for the financing of the two (2) year lease of a Russian No. 6426. Under said law, only the consent of the depositor
    Satellite from INTERSPUTNIK, in accordance with the terms shall serve as the exception for the disclosure of his/her
    and conditions of the credit package entered into by the deposit.
    parties.
    Issue: Which of the two laws should apply in the instant case?
    When Domsat failed to pay the loan, GSIS refused to comply
    with its obligation reasoning that Domsat did not use the loan Ruling:
    proceeds for the payment of rental for the satellite. GSIS
    alleged that Domsat, with Westmont Bank as the conduit, These two laws both support the confidentiality of bank
    transferred the U.S. $11 Million loan proceeds from the deposits. There is no conflict between them. Republic Act No.
    Industrial Bank of Korea to Citibank New York account of 1405 covers all bank deposits in the Philippines and no
    Westmont Bank and from there to the Binondo Branch of distinction was made between domestic and foreign deposits.
    Westmont Bank. The Banks filed a complaint before the RTC Thus, Republic Act No. 1405 is considered a law of general
    of Makati against Domsat and GSIS. application. On the other hand, Republic Act No. 6426 was
    intended to encourage deposits from foreign lenders and
    GSIS insists that Domsat's deposit with Westmont Bank can investors. It is a special law designed especially for foreign
    be examined and inquired into. It anchored its argument on currency deposits in the Philippines. A general law does not
    Republic Act No. 1405 or the "Law on nullify a specific or special law.
    Secrecy of Bank Deposits," which allows the disclosure of
    bank deposits in cases where the money deposited is the In Intengan v. Court of Appeals, the SC categorically declared
    subject matter of the litigation. GSIS asserts that the subject that for foreign currency deposits, such as U.S. dollar
    matter of the litigation is the U.S. $11 Million obtained by deposits, the applicable law is Republic Act No. 6426.
    Domsat from the Banks to supposedly finance the lease of a
    Russian satellite from Intersputnik. Whether or not it should Applying Section 8 of Republic Act No. 6426, absent the
    be held liable as a surety for the principal amount of U.S. $11 written permission from Domsat, Westmont Bank cannot be
    Million, GSIS contends, is contingent upon whether Domsat legally compelled to disclose the bank deposits of Domsat,
    indeed utilized the amount to lease a Russian satellite as otherwise, it might expose itself to criminal liability under the
    agreed in the Surety Bond Agreement. Hence, GSIS argues same act.
    that the whereabouts of the U.S. $11 Million is the subject
    matter of the case and the disclosure of bank deposits relating The petition for certiorari is DISMISSED.
    to the U.S. $11 Million should be allowed.

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