Rehabilitation Plan - Steel Corporation of The Philippines V Mapfre Insurance

STEEL CORPORATION OF THE PHILIPPINES WON the rehabilitation court has jurisdiction over the
vs. MAPFRE INSULAR INSURANCE issue of payment of the insurance proceeds to a

CORPORATIQN, NEW INDIA ASSURANCE corporation under rehabilitation and WON the claim
COMPANY LIMITED, PHILIPPINE CHARTER of SCP for insurance proceeds is covered by the
INSURANCECORPORATION, MALAYAN “claims” under the law
INSURANCECO., INC., and ASIA INSURANCE
CO., INC., and ASIA INSURANCE PHIL. CORP. HELD:
G.R. No. 201199 No. The RTC, acting as rehabilitation court, has no
October 16, 2013 jurisdiction over the subject matter of the insurance
J. Carpio claim of SCP against respondent insurers. SCP must
file a separate action for collection where respondent
FACTS: insurers can properly thresh out their defenses. SCP
cannot simply file with the RTC a motion to direct
SCP is a domestic corporation engaged in the respondent insurers to pay insurance proceeds.
manufacture and distribution of cold-rolled and Section 3 of Republic Act No. 10142 states that
galvanized steel sheets and coils. It obtained loans rehabilitation proceedings are "summary and non-
from several creditors and, as security, mortgaged its adversarial" in nature. They do not include
assets in their favor. The creditors appointed Bank of adjudication of claims that require full trial on the
the Philippine Islands (BPI) as their trustee. SCP and merits, like SCP’s insurance claim against respondent
BPI entered into a Mortgage Trust Indenture (MTI) insurers. In Advent Capital and Finance Corporation
requiring SCP to insure all of its assets until the loans v. Alcantara, the Court held that:
are fully paid. Under the MTI, the insurance policies
were to be made payable to BPI. x x x Said insurance claims cannot be
considered as "claims" within the
When SCP suffered financial difficulties, one of the jurisdiction of the trial court functioning as
creditors filed a petition to have SCP placed under a rehabilitation court. Rehabilitation courts
corporate rehabilitation and the RTC issued a stay only have limited jurisdiction over the
order to defer all claims against SCP, appointed a claims by creditors against the distressed
rehabilitation receiver and eventually approved the company, not on the claims of said
modified rehabilitation plan. distressed company against its debtors. The
interim rules define claim as referring to all
Fires broke out at 2 SCP-plants damaging its claims or demands, of whatever nature or
machineries. Invoking its right under the MTI, BPI character against a debtor or its property,
demanded and received from the insurers the whether for money or otherwise.
insurance proceeds. SCP sought to collect the
insurance proceeds claiming that it shall be used to Even under the new Rules of Procedure on
rehabilitate the corporation by having the Corporate Rehabilitation, claim is defined
machineries repaired and to buy replacements for the under Section 1, Rule 2 as "all claims or
heavily damaged machines and that the assignment demands of whatever nature or character
of the RTC as rehabilitation court did not divest it against a debtor or its property, whether for
from being a court of general jurisdiction. The money or otherwise." This is also the
insurance companies refused to pay SCP the definition of a claim under Republic Act No.
insurance proceeds contending that the fire was 10142. Section 4(c) thereof reads:
caused by several factors attributable to SCP such as
arson and negligence and that the rehabilitation court "(c) Claim shall refer to all claims or
has no jurisdiction over the propriety of the payment demands of whatever nature or character
or non-payment of the insurance proceeds as the against the debtor or its property, whether
“claims” contemplated under the law do not cover the for money or otherwise, liquidated or
claims of the distressed bank to its debtors. The RTC, unliquidated, fixed or contingent, matured
acting as the rehabilitation court, ruled on the matter or unmatured, disputed or undisputed,
and directed the insurance companies to pay the including, but not limited to: (1) all claims
proceeds to SCP. In an appeal with the CA, the of the government, whether national or
appellate court reversed the decision of the trial court. local, including taxes, tariffs and customs
Hence, the present petition. duties; and (2) claims against directors and
officers of the debtor arising from the acts
ISSUE: done in the discharge of their functions
falling within the scope of their authority:
Provided, That, this inclusion does not
prohibit the creditors or third parties from
filing cases against the directors and
officers acting in their personal
capacities." (Emphasis supplied)
Respondent insurers are not claiming or demanding

any money or property from SCP. In other words,
respondent insurers are not creditors of SCP.
Respondent insurers are contingent debtors of SCP
because they may possibly be, subject to proof during
trial, liable to SCP. Thus, the RTC has no jurisdiction
over the insurance claim of SCP against respondent
insurers. SCP must file a separate action against
respondent insurers to recover whatever claim it may
have against them.

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Rehabilitation Plan - Steel Corporation of The Philippines V Mapfre Insurance

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STEEL CORPORATION OF THE PHILIPPINES WON the rehabilitation court has jurisdiction over the

vs. MAPFRE INSULAR INSURANCE issue of payment of the insurance proceeds to a

Respondent insurers are not claiming or demanding

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