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    State Investment House Inc Vs Citibank

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    JR Billones
    The Supreme Court ruled that foreign banks licensed to do business in the Philippines can be considered residents for purposes of involuntary insolvency proceedings. The Court noted that Philippine law assimilates foreign corporations doing business locally to the status of domestic corporations, implying they reside in the country. Additionally, American law recognizes that a corporation resides where it exercises its franchises and conducts business, such that a foreign corporation licensed to do business in a state is a resident for legal purposes. Therefore, the foreign banks with branches in the Philippines conducting banking operations can be viewed as residents under Philippine insolvency law.

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    State Investment House Inc Vs Citibank

    Uploaded by

    JR Billones
    380 views1 page
    The Supreme Court ruled that foreign banks licensed to do business in the Philippines can be considered residents for purposes of involuntary insolvency proceedings. The Court noted that Philippine law assimilates foreign corporations doing business locally to the status of domestic corporations, implying they reside in the country. Additionally, American law recognizes that a corporation resides where it exercises its franchises and conducts business, such that a foreign corporation licensed to do business in a state is a resident for legal purposes. Therefore, the foreign banks with branches in the Philippines conducting banking operations can be viewed as residents under Philippine insolvency law.

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    State Investment House Inc vs Citibank

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    State Investment House Inc vs Citibank

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    The Supreme Court ruled that foreign banks licensed to do business in the Philippines can be considered residents for purposes of involuntary insolvency proceedings. The Court noted that Philippine law assimilates foreign corporations doing business locally to the status of domestic corporations, implying they reside in the country. Additionally, American law recognizes that a corporation resides where it exercises its franchises and conducts business, such that a foreign corporation licensed to do business in a state is a resident for legal purposes. Therefore, the foreign banks with branches in the Philippines conducting banking operations can be viewed as residents under Philippine insolvency law.

    Copyright:

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

    State Investment House Inc Vs Citibank

    Uploaded by

    JR Billones
    The Supreme Court ruled that foreign banks licensed to do business in the Philippines can be considered residents for purposes of involuntary insolvency proceedings. The Court noted that Philippine law assimilates foreign corporations doing business locally to the status of domestic corporations, implying they reside in the country. Additionally, American law recognizes that a corporation resides where it exercises its franchises and conducts business, such that a foreign corporation licensed to do business in a state is a resident for legal purposes. Therefore, the foreign banks with branches in the Philippines conducting banking operations can be viewed as residents under Philippine insolvency law.

    Copyright:

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

    G.R. Nos.

    79926-27 October 17, 1991

    STATE INVESTMENT HOUSE, INC. and STATE FINANCING CENTER, INC., petitioners,
    vs.
    CITIBANK, N.A., BANK OF AMERICA, NT & SA, HONGKONG & SHANGHAI BANKING CORPORATION, and
    the COURT OF APPEALS, respondents.

    FACTS:
    Consolidated Mines, Inc. (CMI) obtained loans from Citibank, Bank of America and HSBC, all
    foreign corporations but with branches in the Philippines. Meanwhile, State Investment House, Inc.
    (SIHI) and State Financing Center, Inc. (SFCI), also creditors of CMI, filed collection suits against the latter
    with writs of preliminary attachment. Subsequently, the three banks jointly filed with the court a
    petition for involuntary insolvency of CMI. SHI and SFCI opposed the petition on the ground that the
    petitioners are not resident creditors in contemplation of the Insolvency Law.

    ISSUES:
    I. Whether or not foreign banks licensed to do business in the Philippines, may be considered "residents
    of the Philippine Islands

    LAW:
    The National Internal Revenue Code declares that the term "'resident foreign corporation' applies to a foreign corporation
    engaged in trade or business within the Philippines," as distinguished from a " "non-resident foreign corporation" . . . (which is
    one) not engaged in trade or business within the Philippines."

    The General Banking Act, Republic Act No. 337, places "branches and agencies in the Philippines of foreign banks . . . (which are)
    called Philippine branches," in the same category as "commercial banks, savings associations, mortgage banks, development
    banks, rural banks, stock savings and loan associations"

    COURTs RULING:
    YES. The Supreme Court held that the assimilation of foreign corporations authorized to do
    business in the Philippines "to the status of domestic corporations," subsumes their being found and
    operating as corporations, hence, residing, in the country.
    The same principle is recognized in American law: that the "residence of a corporation, if it can
    be said to have a residence, is necessarily where it exercises corporate functions;" that it is considered
    as dwelling "in the place where its business is done," as being "located where its franchises are
    exercised," and as being "present where it is engaged in the prosecution of the corporate enterprise;"
    that a "foreign corporation licensed to do business in a state is a resident of any country where it
    maintains an office or agent for transaction of its usual and customary business for venue purposes;"
    and that the "necessary element in its signification is locality of existence." Courts have held that "a
    domestic corporation is regarded as having a residence within the state at any place where it is engaged
    in the particulars of the corporate enterprise, and not only at its chief place or home office;" that "a
    corporation may be domiciled in one state and resident in another; its legal domicil in the state of its
    creation presents no impediment to its residence in a real and practical sense in the state of its business
    activities."
    The foregoing propositions are in accord with the dictionary concept of residence as applied to
    juridical persons, a term which appears to comprehend permanent as well as temporary residence.

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