Spouses Lipana V Development Bank

SECOND DIVISION.
[G.R. No. 73884. September 24, 1987.]
SPOUSES ROMEO LIPANA and MILAGROS LIPANA , petitioners, vs.

DEVELOPMENT BANK OF RIZAL , respondents.
DECISION
PARAS , J : p
This is a petition for review on certiorari of the August 30, 1985 Order of the
Regional Trial Court of Pasig denying petitioners' Motion to Lift Stay of Execution in
Civil Case No. 50802. LLphil
During the period from 1982 to January, 1984, herein petitioners opened and
maintained both time and savings deposits with the herein respondent Development
Bank of Rizal all in the aggregate amount of P939,737.32. When some of the Time
Deposit Certi cates matured, petitioners were not able to cash them but instead were
issued a manager's check which was dishonored upon presentment. Demands for the
payment of both time and savings deposits having failed, on March 14, 1984,
petitioners led with the Regional Trial Court of Pasig a Complaint With Prayer For
Issuance of a Writ of Preliminary Attachment for collection of a sum of money with
damages, docketed therein as Civil Case No. 50802 (Record, pp. 3-11).
Respondent Judge, in an Order dated March 19, 1984 (Ibid., p. 19-21), ordered
the issuance of a writ of attachment, and pursuant thereto, a writ of attachment dated
March 20, 1984 was issued in favor of the petitioners (Ibid., p. 33).
On June 27, 1984, respondent bank filed its Answer (Ibid., p. 58-61).
On July 23, 1984, petitioners led a Motion For Judgment on the Pleadings (Ibid.,
pp. 68-73), opposed by respondent bank (Ibid., pp. 74-76), but respondent judge, in a
Decision dated November 13, 1984, rendered judgment in favor of petitioners. The
dispositive portion of the said Decision, reads:
"IN VIEW OF ALL THE FOREGOING, the Court renders judgment in favor of
the plaintiffs, ordering the defendant to pay the total sum of P939,737.32 plus
stipulated interest; the sum equivalent to 15% of the amount due as attorney's
fees; and costs of suit.
"The counterclaim is dismissed, for lack of merit."
Meanwhile, on August 10, 1984, the Monetary Board, in its Resolution No. 1009,
nding that the condition of respondent bank was one of insolvency and that its
continuance in business would result in probable loss to its depositors and creditors,
decided to place it under receivership (Rollo, p. 84).
On December 7, 1984, petitioners led a Motion for Execution Pending Appeal
(Rcd., pp. 91-93), which was opposed by respondent bank (Ibid., p. 94-96). On
December 27, 1984, petitioners led their Reply to the opposition (Ibid., pp. 98-101), to
which respondent bank filed its Rejoinder on January 1, 1985 (Ibid., pp. 102-105).
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In an order dated January 29, 1985, respondent Judge ordered the issuance of a
writ of execution (Ibid., p. 106).
On February 11, 1985, respondent bank led a Motion for Reconsideration of
order dated January 29, 1985 and to Stay Writ of Execution (Ibid., pp. 109-110),
opposed by petitioners (Ibid., p. 111), but in an Order dated March 6, 1985, respondent
judge stayed the execution (Ibid., p. 113).
On August 7, 1985, petitioners led a Motion to Lift Stay of Execution (Ibid., pp.
119-122), opposed by respondent bank (Ibid., pp. 123-127), and in an Order dated
August 30, 1985, respondent judge denied the said motion (Ibid, p. 130). Hence, the
instant petition (Rollo, pp. 8-17).
The Second Division of the Court, in a resolution dated May 5, 1986, resolved to
require the respondent to comment (Ibid., p. 52). In compliance therewith, respondent
bank filed its Comment on June 9, 1986 (Ibid., pp. 53-58).
The petition was given due course in a resolution dated August 11, 1986, and the
parties were required to le their respective memoranda (Ibid., p. 61). In compliance
therewith, petitioners led their Memorandum on September 19, 1986 (Ibid., p. 63-75),
while respondent bank led its Memorandum on September 25, 1986 (Ibid., pp. 76-83),
and the case was considered submitted for deliberation in the Resolution dated
October 8, 1986 (Ibid., p. 88).
Petitioners raised the following issues:
1. Respondent judge cannot legally stay execution of judgment that
has already become final and executory;
2. The placing under receivership by the Central Bank of the

respondent bank, long after the complaint was filed removed it from the
application of the doctrine in Re: Central Bank vs. Morfe (63 SCRA 113);
3. The filing of the complaint for a sum of money with damages

against respondent bank and the subsequent attachment of its property in Pasig,
Metro Manila long before the receivership took place render inapplicable the
doctrine laid down by this Honorable Supreme Court in the said Morfe case;
4. The indefinite stay of execution without a ruling as to how long it

will last, amounts to deprivation of petitioners of their property without due
process of law.
The instant petition is without merit.

I.
The main issue in this case is whether or not respondent judge could legally stay
execution of judgment that has already become final and executory.
The answer is in the affirmative.
The rule that once a decision becomes nal and executory, it is the ministerial
duty of the court to order its execution, admits of certain exceptions as in cases of
special and exceptional mature where it becomes imperative in the higher interest of
justice to direct the suspension of its execution (Vecine vs. Geronimo, 59 O.G. 579);
whenever it is necessary to accomplish the aims of justice (Pascual vs. Tan, 85 Phil.
164); or when certain facts and circumstances transpired after the judgment became
nal which could render the execution of the judgment unjust (Cabrias vs. Adil, 135
SCRA 354).
In the instant case, the stay of the execution of judgment is warranted by the fact
that respondent bank was placed under receivership. To execute the judgment would
unduly deplete the assets of respondent bank to the obvious prejudice of other
depositors and creditors, since, as aptly stated in Central Bank of the Philippines vs.
Morfe (63 SCRA 114), after the Monetary Board has declared that a bank is insolvent
and has ordered it to cease operations, the Board becomes the trustee of its assets for
the equal bene t of all the creditors, including depositors. The assets of the insolvent
banking institution are held in trust for the equal bene t of all creditors, and after its
insolvency, one cannot obtain an advantage or a preference over another by an
attachment, execution or otherwise. LLphil
Moreover, it will be noted that respondent bank was placed under receivership on
August 10, 1984, and the Decision of respondent judge is dated November 13, 1984.
Accordingly, in line with the ruling in the aforesaid Morfe case, which reads:
"The circumstance that the Fidelity Savings Bank, having stopped
operations since February 19, 1969, was forbidden to do business (and that ban
would include the payment of time deposits) implies that suits for the payment of
such deposits were prohibited. What was directly prohibited should not be
encompassed indirectly. . . .."
petitioners' complaint should have been dismissed.

II.
It is the contention of petitioners, however, that the placing under receivership of
respondent bank long after the ling of the complaint removed it from the doctrine in
the said Morfe case.
This contention is untenable. The time of the ling of the complaint is immaterial.
It is the execution that will obviously prejudice the other depositors and creditors.
Moreover, as stated in the said Morfe case, the effect of the judgment is only to x the
amount of the debt, and not give priority over other depositors and creditors.
III.
Anent the contention of petitioners that the attachment of one of the properties
of respondent bank was erased by virtue of the delayed receivership is to expand the
power of the Central Bank, Su ce it to say that in the case of Central Bank of the
Philippines, et al. vs. Court of Appeals, et al. (Resolution of this Court dated September
17, 1984 in G.R. No. 33302), wherein the original plaintiff Algue Inc. was able to obtain a
writ of preliminary attachment against the original defendant Island Savings Bank, this
Court refused to recognize any preference resulting from such attachment and ruled
that after a declaration of insolvency, the remedy of the depositors is to intervene in the
liquidation proceedings.
IV.
It is also contended by the petitioners that the inde nite stay of execution
without ruling as to how long it will last, amounts to a deprivation of their property
without due process of law. LibLex
Said contention, likewise, is devoid of merit. Apart from the fact that the stay of
execution is not only in accordance with law but is also supported by jurisprudence,
such staying of execution is not without a time limit. In fact, the Monetary Board, in its
resolution No. 433 approved the liquidation of respondent bank on April 26, 1985 and
ordered, among others, the ling of a petition in the Regional Trial Court praying for
assistance of said court in the liquidation of the bank. (Rollo, p. 81). The staying of the
writ of execution will be lifted after approval by the liquidation court of the project of
distribution, and the liquidator or his deputy will authorize payments to all claimants
concerned in accordance with the approved project of distribution.
PREMISES CONSIDERED, the instant petition is hereby DISMISSED.
SO ORDERED.
Yap (Chairman), Melencio-Herrera, Padilla and Sarmiento, JJ., concur.

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SECOND DIVISION.

[G.R. No. 73884. September 24, 1987.]

SPOUSES ROMEO LIPANA and MILAGROS LIPANA , petitioners, vs.

"The counterclaim is dismissed, for lack of merit."

2. The placing under receivership by the Central Bank of the

3. The filing of the complaint for a sum of money with damages

4. The indefinite stay of execution without a ruling as to how long it

The instant petition is without merit.

petitioners' complaint should have been dismissed.

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