Bangko Sentral ng Pilipinas and its Monetary Board vs. Banco Filipino Savings and Mortgage Bank

A final and executory judgment may be enforced by motion within five years from entry; after that period, it may be enforced only by an action for revival filed within ten years from the judgment’s finality. A revival action is barred once that ten-year period lapses, and it cannot be used to obtain reliefs beyond the four corners of the original judgment or to enforce an obligation already extinguished by performance.

Banco Filipino Savings and Mortgage Bank (BFSMB) is a savings and mortgage bank that commenced operations in 1964 under authority of the old Central Bank of the Philippines. The old Central Bank was later abolished by Republic Act No. 7653, which created Bangko Sentral ng Pilipinas (BSP) and continued the old Central Bank as the Central Bank-Board of Liquidators (CB-BOL) for the sole purpose of administering and liquidating assets and liabilities not transferred to BSP. The present consolidated petitions trace back to a final Supreme Court judgment in G.R. No. 70054, which had annulled the old Central Bank’s closure order and directed the reorganization and reopening of BFSMB.

Banco Filipino Savings and Mortgage Bank (BFSMB) commenced operations as a savings and mortgage bank on July 9, 1964, pursuant to Resolution No. 223 dated February 14, 1963 of the Monetary Board of the Central Bank of the Philippines. On July 27, 1984, through MB Resolution No. 955, the Central Bank-Monetary Board placed BFSMB under the conservatorship of Basilio Estanislao. On January 25, 1985, through MB Resolution No. 75, the Central Bank-Monetary Board ordered the closure of BFSMB on the ground that it was insolvent and that its continuance in business would involve probable loss to its depositors and creditors.

On February 28, 1985, BFSMB filed before the Supreme Court a petition for certiorari and mandamus under Rule 65, seeking to annul MB Resolution No. 75 as made without or in excess of jurisdiction or with grave abuse of discretion. The petition was docketed as G.R. No. 70054 and was later consolidated with eight other cases. In a consolidated Decision dated December 11, 1991, the Supreme Court annulled and set aside MB Resolution No. 75 and ordered the Central Bank and the Monetary Board to reorganize BFSMB and allow it to resume business in the Philippines under the comptrollership of both the Central Bank and the Monetary Board, under such conditions as may be prescribed by the Monetary Board in connection with its reorganization, until such time that BFSMB could continue in business with safety to its creditors, depositors, and the general public. The Decision became final and executory on February 4, 1992.

Republic Act No. 7653, the New Central Bank Act of 1993, took effect on July 6, 1993. It abolished the old Central Bank and established the Bangko Sentral ng Pilipinas (BSP). The old Central Bank continued to exist under the name Central Bank-Board of Liquidators (CB-BOL) for the sole purpose of administering and liquidating the assets and liabilities of the old Central Bank that were not transferred to BSP. On November 6, 1993, the BSP-Monetary Board resolved to allow BFSMB to reopen, subject to submission of its proposed organization, list of officers, and plan of operations; to instruct management to advise BFSMB and to ask it to collateralize its advances from BSP; and to authorize management to file a case for recovery of advances. On July 1, 1994, BFSMB reopened and resumed business under the comptrollership of BSP. On December 20, 1999, BSP and BFSMB entered into a Memorandum of Agreement under which BFSMB was to repay P3,673,031,589.36 through dacion en pago of some of its real properties. Under the agreement, BSP was to lift its comptrollership over BFSMB on January 20, 2000 and deliver to BFSMB all collaterals in its custody, including government securities held by designated comptrollers.

Sometime in December 2002, BFSMB experienced massive withdrawals and applied for emergency financial assistance from BSP. In a letter dated October 9, 2003, BFSMB requested financial assistance similar to arrangements extended to other banks. In a letter dated November 21, 2003, BSP advised BFSMB that because of strict requirements imposed by Republic Act No. 7653, BSP was not in a position to assist BFSMB at that time, but added that should BFSMB comply with all legal requirements, including a BSP-approved rehabilitation program, ESP would not hesitate to extend support. On April 14, 2004, BFSMB transmitted a long-term business plan premised on the assertion that BSP had stepped into the shoes of the old Central Bank and was obligated to reorganize BFSMB by restoring its 89 branches and extending financial support not subject to stringent requirements. BSP-MB replied that it had no basis to act on the business plan because the plan appeared to have been approved by BFSMB’s Executive Committee and not its Board of Directors, and because of BFSMB’s insistence that BSP-MB were successors-in-interest of the old Central Bank, an allegation BSP-MB consistently denied and which was still subject to contest in pending court proceedings.

On July 14, 2004, BFSMB filed a Petition for Revival of Judgment to enforce the December 11, 1991 Decision in G.R. No. 70054, which had become final and executory on February 4, 1992. The petition was filed against the old Central Bank-Monetary Board, represented by CB-BOL, and against BSP-MB. BFSMB alleged that its reopening was only partial fulfillment of the judgment; that the respondents were mandated to reorganize it and place it in such condition and footing that it could continue in business with safety to its depositors, creditors, and the general public; that it had managed to reopen only 60 of its 89 branches; that BSP refused to grant it a universal bank license and did not act on its business plan; that BSP had extended financial assistance to other banks; and that BSP was the successor-in-interest of the old Central Bank. BFSMB prayed for revival of the judgment and for orders directing the respondents to comply with its mandates, approve its business plan, and extend financial arrangements similarly granted to other banks. BSP-MB and CB-BOL separately moved to dismiss on grounds including nonpayment of docket fees, prescription, no cause of action, lack of successor-in-interest status, extinguishment of the obligation, litis pendentia, unauthorized signatories, false certification of non-forum shopping, limited powers of CB-BOL, lack of consent to be sued, and improper service of summons. The RTC denied the motions, and the CA later rendered conflicting decisions on the two certiorari petitions. The record further showed that BFSMB reopened on July 1, 1994 under BSP comptrollership, and that the December 20, 1999 Memorandum of Agreement recited BSP’s compliance with the G.R. No. 70054 Decision and provided for the lifting of comptrollership on January 20, 2000.

• BSP-MB (G.R. No. 178696) — Successor-in-Interest: BSP-MB argued that under Section 132(e) of Republic Act No. 7653, the liabilities of the old Central Bank to BFSMB were retained by CB-BOL, not succeeded by BSP, and that the Court of Appeals erred in ruling that BSP succeeds in the alleged liabilities.
• BSP-MB — No Cause of Action: BSP-MB maintained that BFSMB’s petition stated no cause of action against them because they were neither parties to G.R. No. 70054 nor transferees pendente lite of the old Central Bank.
• BSP-MB — Prescription: BSP-MB argued that the remedy to revive the December 11, 1991 Decision had prescribed because the petition was filed only on July 14, 2004, more than 12 years after finality on February 4, 1992.
• BSP-MB — Reliefs Beyond Ambit and Discretion: BSP-MB contended that the reliefs sought by BFSMB were beyond the ambit of the judgment sought to be revived and lay purely within BSP-MB’s discretion, hence could not be mandated by judicial compulsion through mere revival of judgment.
• BSP-MB — Compliance and Mootness: BSP-MB asserted that the obligations mandated by the 1991 Decision had already been performed and that the prayer for approval of BFSMB’s business plan had been rendered moot by BFSMB’s submission of a revised business plan on April 7, 2005.
• BSP-MB — Procedural Objections: BSP-MB moved to dismiss on grounds of nonpayment of docket fees, litis pendentia, unauthorized signatories, and false certification of non-forum shopping.
• BFSMB (G.R. No. 192607) — Grave Abuse of Discretion: BFSMB argued that the Court of Appeals departed from the accepted and usual course of judicial proceedings and acted without any showing or finding of grave abuse of discretion when it gave due course to and granted CB-BOL’s Rule 65 petition and annulled the RTC’s denial of the motion to dismiss.
• BFSMB — Capacity, Tolling, Stare Decisis, Abandonment: BFSMB argued that the Court of Appeals disregarded matters of substance: CB-BOL’s admission that it is an unincorporated government agency; the tolling of prescription and the supporting allegations; the doctrine of stare decisis relative to the earlier CA decision in CA-G.R. SP No. 96831; and CB-BOL’s alleged abandonment of its CA petition by filing an Answer in the RTC after the CA had ordered dismissal.

• BFSMB (as respondent in G.R. No. 178696) — Partial Performance and Continuing Obligation: BFSMB alleged that its reopening was only partial fulfillment of the judgment and that the respondents were obligated to reorganize it and place it in such condition and footing to continue business with safety to its depositors, creditors, and the general public until its damage claims were fully settled.
• BFSMB — Specific Undertakings: BFSMB claimed that the judgment obligation included restoring its 89 branches, recouping its 3.8 million depositors, approving its business plan, and extending financial arrangements similarly granted to other banks.
• BFSMB — Successor-in-Interest: BFSMB asserted that BSP is the successor-in-interest of the old Central Bank under Republic Act No. 7653, having reopened BFSMB and collected the old Central Bank’s advances as assignee under the Memorandum of Agreement.
• BFSMB — Prescription Tolled: BFSMB argued that the passage of Republic Act No. 7653 tolled the prescriptive period because it rendered the enforceability of the judgment uncertain, and that partial performance by BSP further tolled the period.
• CB-BOL (as respondent in G.R. No. 192607) — Forum Shopping and No Cause of Action: CB-BOL argued that BFSMB engaged in forum shopping and had no cause of action because it had already resumed operations on July 1, 1994.
• CB-BOL — Limited Powers: CB-BOL maintained that its powers under Republic Act No. 7653 are limited to administering, disposing of, and liquidating assets and liabilities of the old Central Bank not transferred to BSP, and that it has no authority to reorganize BFSMB or approve its business plan.
• CB-BOL — Government Immunity, Prescription, Authority, Summons: CB-BOL argued that it is an unincorporated government agency without separate juridical personality, requiring consent to be sued; that the petition was filed beyond the 10-year period under Article 1144 of the Civil Code; that the signatories were unauthorized; and that summons was improperly served.

• Prescription of Revival: Whether BFSMB’s Petition for Revival of Judgment filed on July 14, 2004 was barred by prescription, given that the judgment in G.R. No. 70054 became final and executory on February 4, 1992.
• Extinguishment by Performance: Whether the judgment obligation in G.R. No. 70054 had already been extinguished by performance when BFSMB was reopened and reorganized under the comptrollership of BSP-MB.
• Scope of Reliefs in a Revival Action: Whether the reliefs prayed for by BFSMB—approval of its business plan, restoration of 89 branches, recoupment of 3.8 million depositors, and extension of financial arrangements—are within the ambit of the judgment sought to be revived.
• Successor-in-Interest and Cause of Action: Whether BSP-MB and CB-BOL are successors-in-interest of the old Central Bank and proper parties against whom the revival action may be maintained.
• Procedural Grounds for Dismissal: Whether the procedural objections raised by BSP-MB and CB-BOL—docket fees, forum shopping, litis pendentia, authority of signatories, and service of summons—warrant dismissal of the revival petition.
• Consolidation of Related Appeals: Whether the Court of Appeals should have consolidated CA-G.R. SP Nos. 96280 and 96831, which involved the same parties, facts, and issues.

• Prescription of Revival: Yes. The petition was time-barred, having been filed more than 12 years after the judgment became final on February 4, 1992, beyond the 10-year period under Article 1144 and Article 1152 of the Civil Code, read with Rule 39, Section 6 of the Rules of Court.
• Extinguishment by Performance: Yes. The judgment obligation had been extinguished by performance because BFSMB was reopened on July 1, 1994 under BSP-MB comptrollership, and the December 20, 1999 Memorandum of Agreement recited compliance and provided for the lifting of comptrollership on January 20, 2000.
• Scope of Reliefs in a Revival Action: No. The reliefs are beyond the four corners of the judgment. A revival action cannot modify, alter, or reverse the original judgment, and the reliefs lie within BSP-MB’s statutory discretion.
• Successor-in-Interest and Cause of Action: Not reached. The dismissal on prescription and performance rendered it unnecessary to determine successor status, especially because it may preempt pending Civil Case Nos. 8108, 9675, and 10183.
• Procedural Grounds for Dismissal: Moot and academic. The other procedural matters need not be resolved because dismissal is already warranted on prescription and performance.
• Consolidation of Related Appeals: The Court of Appeals should have consolidated the two petitions. Consolidation of cases resting on the same facts or involving identical claims, interests, or parties is mandatory in the appellate stage.

• Prescription of Revival: Rule 39, Section 6 of the Rules of Court allows execution by motion within five years from entry of judgment; after that period, and before the judgment is barred by the statute of limitations, it may be enforced by action. Civil Code Article 1144(3) requires actions upon judgment to be brought within ten years from the time the right of action accrues, and Article 1152 provides that the period commences from the time the judgment became final. The G.R. No. 70054 Decision became final on February 4, 1992, so BFSMB had until February 4, 2002 to file an action for revival. It filed only on July 14, 2004, more than 12 years after finality. BFSMB’s tolling argument was rejected: Republic Act No. 7653 did not create a vacuum because BSP and CB-BOL were readily identifiable, and BFSMB could have sued both within the prescriptive period. Partial performance did not toll the period. The Court of Appeals in CA-G.R. SP No. 96280 correctly held that Article 1155 of the Civil Code is inapplicable because it refers to actions to collect debt under contract or law, not to actions to enforce or revive judgment. Thus, the revival action was time-barred.
• Extinguishment by Performance: Even if prescription were disregarded, the petition for revival had to be dismissed because the judgment obligation had already been extinguished by performance. An action to revive judgment is one whose exclusive purpose is to enforce a judgment that can no longer be enforced by mere motion; it is subject to defenses such as prescription or payment. The judgment directed the old Central Bank and Monetary Board to reorganize BFSMB and allow it to resume business under comptrollership and under conditions to be prescribed by the Monetary Board until BFSMB could continue safely. It did not specify how BFSMB was to be reorganized or what conditions would be imposed. BFSMB’s claimed undertakings—restoring 89 branches, recouping 3.8 million depositors, approving its business plan, extending financial arrangements, and settling damage claims—were not supported by the judgment. BSP-MB Resolution No. 427 dated November 6, 1993 allowed BFSMB to reopen; BFSMB reopened on July 1, 1994 under BSP comptrollership; the December 20, 1999 Memorandum of Agreement recited BSP’s compliance; and the comptrollership was lifted on January 20, 2000. The judgment obligation was therefore extinguished through performance.
• Scope of Reliefs in a Revival Action: The cause of action in a petition for revival is the judgment itself, not the merits of the original case. The judgment sought to be revived is final and conclusive, and the new action does not re-examine issues already decided. Courts may consider documents incorporated in the petition, including the G.R. No. 70054 Decision, and need not await trial to determine whether the obligation had been performed. BFSMB’s claimed obligations were contradicted by the judgment. An action for revival of judgment cannot modify, alter, or reverse the original judgment, which is already final and executory. The reliefs sought by BFSMB went beyond the four corners of the judgment. Moreover, Republic Act No. 7653, Sections 1 to 3, establish BSP as an independent central monetary authority with fiscal and administrative autonomy and supervision over banks. Nothing in the G.R. No. 70054 Decision empowered the RTC or the Court of Appeals to fetter BSP-MB’s discretion regarding the conditions to impose or concessions to extend during reorganization. The reliefs lay within BSP-MB’s discretion and could not be mandated by judicial compulsion through a mere revival of judgment.
• Successor-in-Interest and Cause of Action: The Court found no need to determine whether BSP-MB is the successor-in-interest or transferee pendente lite of the old Central Bank. Although G.R. No. 173399 pronounced that BSP and its Monetary Board have different legal personalities from the defunct Central Bank and its Monetary Board, any determination of the status of BSP-MB and CB-BOL would likely preempt the resolution of Civil Case Nos. 8108, 9675, and 10183, which relate to their potential liability for causes of action originally levelled against the old Central Bank. The Court also declined to pass upon issues related to those civil cases.
• Procedural Grounds for Dismissal: Because the dismissal of the Petition for Revival of Judgment was already warranted on prescription and performance, any discussion of the other procedural matters raised in the consolidated cases was moot and academic.
• Consolidation of Related Appeals: The two petitions in the Court of Appeals involved the same parties, set of facts, and issues, and basically assailed the same orders of the RTC. There was no reason why CA-G.R. SP Nos. 96280 and 96831 should not have been consolidated at the first instance. In the appellate stage, the rigid policy is to make consolidation of all cases and proceedings resting on the same set of facts, or involving identical claims or interests or parties, mandatory, regardless of whether the parties or any of them requests it. The failure to consolidate led to diametrically opposed decisions by the Court of Appeals, the very evil that the rule against forum shopping seeks to forestall. Counsel also have the responsibility to give prompt notice of related cases and to move for consolidation.

• Execution of Final Judgment by Motion or Independent Action — Under Rule 39, Section 6 of the Rules of Court, a final and executory judgment may be executed by motion within five years from entry; after that period, and before barred by the statute of limitations, it may be enforced by action. Read with Civil Code Articles 1144(3) and 1152, the action upon judgment must be brought within ten years from finality. The Court applied this to hold BFSMB’s July 14, 2004 revival petition time-barred because the judgment became final on February 4, 1992.
• Revival of Judgment — An action to revive judgment is one whose exclusive purpose is to enforce a judgment that can no longer be enforced by mere motion. Its cause of action is the judgment itself, not the merits of the original case, and it cannot modify, alter, or reverse the original judgment. The Court applied this to reject BFSMB’s additional reliefs and to hold that the revival petition could not expand the 1991 judgment.
• Extinguishment of Judgment Obligation by Performance — A judgment obligation may be extinguished by performance, and a revival action is subject to defenses such as payment or performance. The Court applied this because BFSMB was reopened and reorganized under BSP-MB comptrollership, and the December 20, 1999 Memorandum of Agreement recited compliance and led to the lifting of comptrollership on January 20, 2000.
• Hypothetical Admission in a Motion to Dismiss and Its Exceptions — A defendant moving to dismiss generally hypothetically admits the truth of the material allegations of ultimate fact in the complaint, but the rule does not admit facts contradicted by a record incorporated in the pleading or by a document referred to therein. The Court applied this by examining the G.R. No. 70054 Decision incorporated in the revival petition and holding that BFSMB’s claimed obligations were contradicted by the judgment.
• Mandatory Consolidation of Related Cases in the Appellate Stage — In the appellate stage, consolidation of all cases and proceedings resting on the same set of facts, or involving identical claims or interests or parties, is mandatory regardless of whether the parties request it. The Court applied this to CA-G.R. SP Nos. 96280 and 96831, which should have been consolidated and which produced conflicting decisions.
• BSP Independence and Discretion in Banking Regulation — Republic Act No. 7653 establishes BSP as an independent central monetary authority with fiscal and administrative autonomy and supervision over banks. The Court applied this to hold that the reliefs sought by BFSMB lay within BSP-MB’s discretion and could not be judicially compelled through a mere revival of judgment.

• "A final and executory judgment or order may be executed on motion within five (5) years from the date of its entry. After the lapse of such time, and before it is barred by the statute of limitations, a judgment may be enforced by action x x x." — This states the two modes of executing a final judgment and anchors the Court’s prescription analysis.
• "Accordingly, the prevailing party may move for the execution of a final and executory judgment as a matter of right within five years from the entry of judgment. If no motion is filed within this period, the judgment is converted to a mere right of action and can only be enforced by instituting a complaint for the revival of judgment in regular court within 10 years from finality of judgment." — This is the ratio decidendi on the prescriptive period for a revival action.
• "An action for revival of judgment cannot modify, alter or reverse the original judgment, which is already final and executory." — This defines the limited scope of a revival action and supports the rejection of BFSMB’s additional reliefs.
• "In the appellate stage, therefore, the rigid policy is to make the consolidation of all cases and proceedings resting on the same set of facts, or involving identical claims or interests or parties mandatory. Such consolidation should be made regardless of whether or not the parties or any of them requests it." — This states the mandatory consolidation policy that the Court applied to the two conflicting Court of Appeals petitions.

• Villeza vs. German Management and Services, Inc., 641 Phil. 544, 550 (2010) — Cited for the rule that a final judgment may be executed by motion within five years and, after that, by an action for revival within ten years from finality.
• Caiña vs. Court of Appeals, 309 Phil. 241, 249 (1994) — Cited for the definition of an action to revive judgment as one whose exclusive purpose is to enforce a judgment that can no longer be enforced by mere motion.
• Compania General de Tabacos vs. Martinez, 29 Phil. 515, 520-521 (1915) — Cited for the principle that a revival action is subject to defenses and counterclaims, such as prescription or payment.
• Azotes vs. Blanco, 85 Phil. 90, 91 (1949) — Cited for the rule that a judgment sought to be revived is final and conclusive; the new action does not re-examine issues already decided.
• Estonina vs. Southern Marketing Corp., 249 Phil. 562, 567 (1988) — Cited for the rule that the cause of action in a petition for revival is the judgment to be revived.
• Pioneer Concrete Philippines, Inc. vs. Todaro, 551 Phil. 589 (2007) — Cited for the general rule that a motion to dismiss hypothetically admits the truth of the material allegations of ultimate fact in the complaint.
• Tan vs. Court of Appeals, 356 Phil. 555, 563-564 (1998) — Cited for the exceptions to hypothetical admission, including facts contradicted by a record incorporated in the pleading or by a document referred to therein.
• Heirs of Numeriano Miranda, Sr. vs. Miranda, 713 Phil. 541, 551 (2013) — Cited for the rule that an action for revival of judgment cannot modify, alter, or reverse the original final and executory judgment.
• Banco Filipino Savings and Mortgage Bank vs. The Monetary Board, 281 Phil. 842 (1991) — The judgment sought to be revived in these cases; also cited for the original directive to reorganize and reopen BFSMB and for the Central Bank’s supervisory concerns.
• Central Bank-Board of Liquidators vs. Banco Filipino Savings and Mortgage Bank, G.R. No. 173399 — Cited for the pronouncement that BSP and its Monetary Board have different legal personalities from the defunct Central Bank and its Monetary Board, while any determination of status may preempt pending civil cases.
• A.M. No. CA-13-51-J, Re: Letter Complaint of Merlita B. Fabiana Against Presiding Justice Andres B. Reyes, Jr., et al., 713 Phil. 161, 177 (2013) — Cited for the mandatory policy of consolidating related cases in the appellate stage.

• Rule 39, Section 6, Rules of Court — Provides that a final and executory judgment may be executed by motion within five years from entry; after that, and before barred by the statute of limitations, by action. Applied to hold BFSMB’s revival action time-barred.
• Article 1144(3), Civil Code — Requires actions upon judgment to be brought within ten years from the time the right of action accrues. Applied with Article 1152 to fix the ten-year period from finality.
• Article 1152, Civil Code — Provides that the period for prescription of actions to demand fulfillment of an obligation declared by judgment commences from the time the judgment became final. Applied to start the period on February 4, 1992.
• Article 1155, Civil Code — Provides for tolling of the prescriptive period; the Court of Appeals held, and the Supreme Court agreed, that it refers to actions to collect debt under contract or law, not to actions to enforce or revive judgment. Applied to reject BFSMB’s tolling argument.
• Rule 16, Section 1(f), (g), and (h), Rules of Court — Lists grounds for dismissal: cause of action barred by prior judgment or statute of limitations; pleading states no cause of action; claim paid, waived, abandoned, or otherwise extinguished. Cited as the grounds raised by BSP-MB and CB-BOL.
• Republic Act No. 7653, Sections 1, 2, and 3 — Establish BSP as an independent central monetary authority with fiscal and administrative autonomy and supervision over banks. Applied to hold that the reliefs sought by BFSMB lay within BSP-MB’s discretion.
• Republic Act No. 7653, Section 132(e) — Provides that the old Central Bank continues as CB-BOL for the sole purpose of administering and liquidating assets and liabilities not transferred to BSP. Cited in the factual background and arguments; the Court did not need to resolve its application because dismissal was based on prescription and performance.
• Republic Act No. 265, Section 29 — Central Bank Act provision allowing a closed bank to be reorganized or placed in such condition that it may resume business with safety to depositors, creditors, and the general public. Cited as the source of the obligation in G.R. No. 70054.
• A.M. No. 03-1-09-SC — Guidelines for pre-trial; cited by the RTC in denying the motions to dismiss. The Supreme Court noted it in the procedural background but did not rely on it because the other procedural matters were moot.

Peralta, Del Castillo, Tijam, and Gesmundo, JJ., concur.