Servo vs. Philippine Deposit Insurance Corporation

The Court of Appeals has jurisdiction over petitions for certiorari assailing the PDIC's denial of deposit insurance claims, pursuant to Section 5(g) of RA 3591 as amended by RA 10846, which provides that PDIC actions on insured deposits shall be final and executory and may only be restrained or set aside by the Court of Appeals upon appropriate petition for certiorari under Rule 65, filed within thirty (30) days from notice of denial.

Petitioner Connie L. Servo lent Teresita Guiterrez P500,000 for the repair of Guiterrez's bus units. To receive repayment, petitioner opened a time deposit account at the Rural Bank of San Jose Del Monte under Guiterrez's name, as Guiterrez was a preferred bank client. The bank was subsequently closed, prompting petitioner to file a claim for deposit insurance with the Philippine Deposit Insurance Corporation (PDIC), the government instrumentality tasked with administering the deposit insurance system under RA 3591, as amended by RA 10846.

In October 2011, petitioner Connie L. Servo lent Teresita Guiterrez P500,000 for the repair of Guiterrez's bus units. On January 19, 2012, petitioner met with Guiterrez at the Rural Bank of San Jose Del Monte to receive the loan repayment. For this purpose, petitioner opened a time deposit account with the bank under Special Savings Deposit (SSD) Account No. 001 03-00904-1. Per their agreement, Guiterrez's name was used as the account holder because she was a preferred bank client.

The bank was later closed. Petitioner then filed a claim for deposit insurance with the PDIC by Affidavit dated August 22, 2014, accompanied by supporting documents. She claimed to have verbally informed Eliza Dela Peña, a bank teller, that the P500,000 deposited in SSD Account No. 001 03-00904-1 was held in trust for her by Guiterrez, and she categorically stated that she was the exclusive owner of the account.

By letter dated August 27, 2014, PDIC, through its Claims Deposit Department, denied the claim, citing the absence of any bank records or documents indicating that petitioner, rather than Guiterrez, owned the account. Petitioner filed a Request for Reconsideration on October 30, 2014. PDIC denied the request by letter dated July 16, 2015, this time citing petitioner's failure to submit documents showing that the "break-up and transfer of Legitimate Deposit to the transferee is for a Valid Consideration." PDIC also emphasized that petitioner was not even a relative within the second degree of consanguinity or affinity of Guiterrez.

Petitioner subsequently filed an action for certiorari before the RTC on August 19, 2016, imputing grave abuse of discretion on PDIC for denying her claim despite her submission of the necessary documents. She alleged that, assuming the documents were incomplete, she was not given the opportunity to submit additional documents or called to a clarificatory meeting, as provided in Sections 4(b) and 4(c) of PDIC Regulatory Issuance No. 2011-03. PDIC countered that the RTC lacked jurisdiction because the matter fell exclusively within PDIC's quasi-judicial jurisdiction, and that no grave abuse of discretion attended its evaluation of the available bank documents. The RTC sustained PDIC's position and dismissed the case for lack of jurisdiction on July 27, 2017. Petitioner then elevated the matter to the Court of Appeals, which dismissed the petition by Resolution dated September 22, 2017, on the ground that the jurisdictional issue involved a pure question of law cognizable by the Supreme Court under Rule 45.

• Jurisdiction of the Court of Appeals: Petitioner argued that PDIC was not among the quasi-judicial bodies enumerated under Section 1, Rule 43 of the Rules of Court whose decisions are appealable via petition for review with the Court of Appeals, and that the mere performance of quasi-judicial functions does not make PDIC co-equal with the RTCs.
• Analogy to Department of Finance Rulings: Petitioner maintained that since rulings of the Department of Finance are appealable to the Court of Tax Appeals — which has the same rank as the Court of Appeals — it cannot be said that rulings of PDIC, an instrumentality operating under the Department of Finance, are appealable to the Court of Appeals alone.
• Non-retroactivity of RA 10846: Petitioner asserted that the amendatory provisions under RA 10846 should not apply to her case, considering that her claim was denied on July 16, 2015, prior to the effectivity of RA 10846 on June 11, 2016.
• Alternative Prayer for Substantial Justice: Petitioner implored the Court of Appeals to treat her petition as a petition for certiorari against PDIC's denial of her claim in the interest of substantial justice, including an alternative prayer that the petition be granted by ordering PDIC to pay the insured amount of P500,000.

• Lack of RTC Jurisdiction: Respondent countered that the RTC had no jurisdiction over the subject matter of the petition, as the same fell exclusively within PDIC's quasi-judicial jurisdiction.
• Absence of Grave Abuse of Discretion: Respondent argued that there was no grave abuse of discretion amounting to lack or excess of jurisdiction when, after evaluation and analysis of available bank documents, it concluded that petitioner was not entitled to deposit insurance.

• Jurisdiction of the Court of Appeals: Whether the Court of Appeals erred in dismissing the petition for certiorari on the ground of lack of jurisdiction.
• Applicability of RA 10846: Whether the amendatory provisions of RA 10846 apply to petitioner's case notwithstanding that her claim was denied prior to its effectivity.
• Alternative Prayer: Whether the Court of Appeals should have treated the petition as an original action against the assailed PDIC dispositions.

• Jurisdiction of the Court of Appeals: Yes, the Court of Appeals erred. Section 9 of BP 129 vests concurrent jurisdiction in the RTC, the Court of Appeals, and the Supreme Court over special civil actions for certiorari, and the law does not distinguish between factual, legal, or mixed issues for this purpose. The hierarchy of courts doctrine does not divest the CA of jurisdiction.
• Applicability of RA 10846: Yes, RA 10846 applies. When petitioner initiated her action before the RTC on August 19, 2016, RA 10846 was already effective (June 11, 2016), and petitioner was bound to comply with its procedures, including the vesting of jurisdiction in the Court of Appeals to review PDIC actions.
• Alternative Prayer: No. The Court of Appeals could not have granted the alternative prayer because the petition was filed beyond the thirty (30)-day reglementary period prescribed under Section 5(g) of RA 3591 as amended by RA 10846.

• Jurisdiction of the Court of Appeals: Section 9 of BP 129 grants the Court of Appeals original jurisdiction to issue writs of certiorari, prohibition, mandamus, habeas corpus, and quo warranto, whether or not in aid of its appellate jurisdiction. This jurisdiction is concurrent with that of the RTCs and the Supreme Court. The law does not distinguish whether the issues involved are pure factual, legal, or mixed for the purpose of determining which court should take cognizance. The doctrine of hierarchy of courts, as articulated in Gios-Samar, Inc. vs. Department of Transportation and Communications and People vs. Cuaresma, serves as a general determinant of the appropriate forum but does not negate the CA's jurisdiction. There was no compelling reason for the CA not to adhere to and observe the hierarchy of courts, as petitions against quasi-judicial agencies should be filed with the CA. The Court deemed it prudent to resolve the jurisdictional issue directly rather than remand, to avert further delay.

• Applicability of RA 10846: Although petitioner's claim was denied on July 16, 2015 — before RA 10846's effectivity on June 11, 2016 — the critical date is when petitioner initiated her action before the RTC on August 19, 2016, by which time RA 10846 was already effective. Section 5(g) of RA 3591, as amended by RA 10846, expressly provides that PDIC actions on matters relating to insured deposits shall be final and executory and may only be restrained or set aside by the Court of Appeals upon appropriate petition for certiorari under Rule 65, filed within thirty (30) days from notice of denial. This was confirmed in Peter L. So vs. Philippine Deposit Insurance Corp., which held that a petition for certiorari questioning PDIC's denial of a deposit insurance claim should be filed before the CA, not the RTC, further supported by Section 22 of the PDIC Charter prohibiting any court except the Court of Appeals from issuing injunctive relief against the Corporation.

• Alternative Prayer: Petitioner's Request for Reconsideration was denied on July 16, 2015. She filed her petition for certiorari with the Court of Appeals only on September 7, 2017 — more than two years from PDIC's denial of her claim. This was well beyond the thirty (30)-day reglementary period prescribed under Section 5(g) of RA 3591 as amended by RA 10846. By that time, the assailed trial court's ruling had already lapsed into finality, leaving nothing for the Court of Appeals to act upon.

• Doctrine of Hierarchy of Courts — The Supreme Court's original jurisdiction to issue extraordinary writs is not exclusive but shared with the RTCs and the Court of Appeals. However, this concurrence of jurisdiction does not accord parties an absolute, unrestrained freedom of choice of forum. A becoming regard for the judicial hierarchy requires that petitions for extraordinary writs against first-level courts be filed with the RTC, and those against the RTC be filed with the Court of Appeals. Direct invocation of the Supreme Court's original jurisdiction should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. In this case, there was no compelling reason for the CA not to observe the hierarchy of courts, as petitions against quasi-judicial agencies properly belong before the CA.

• Jurisdiction over PDIC Actions — Under Section 5(g) of RA 3591 as amended by RA 10846, the actions of PDIC on matters relating to insured deposits and deposit liabilities are final and executory and may only be restrained or set aside by the Court of Appeals upon appropriate petition for certiorari under Rule 65, on the ground that the action was taken in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of jurisdiction. The petition must be filed within thirty (30) days from notice of denial of the claim for deposit insurance.

• "For one, Section 9 of BP 129 vests concurrent jurisdiction in the regional trial courts, the Court of Appeals, and the Supreme Court over special civil actions and auxiliary writs and processes. The law does not distinguish whether the issues involved are pure factual or legal issues or mixed issues of fact and law for the purpose of determining which of which of the courts should take cognizance of the case." — This passage articulates the ratio decidendi on the CA's jurisdictional error: BP 129's grant of concurrent jurisdiction over extraordinary writs is not conditioned on the nature of the issues presented.

• "The actions of the Corporation taken under Section 5(g) shall be final and executory, and may only be restrained or set aside by the Court of Appeals, upon appropriate petition for certiorari on the ground that the action was taken in excess of jurisdiction or with such grave abuse of discretion as to amount to a lack or excess of jurisdiction. The petition for certiorari may only be filed within thirty (30) days from notice of denial of claim for deposit insurance." — This is the statutory text of Section 5(g) of RA 3591 as amended by RA 10846, which the Court applied to establish the CA's exclusive jurisdiction over certiorari petitions against PDIC rulings and the 30-day reglementary period.

• "The Court of Appeals could not have granted petitioner's prayer to consider her petition to have been filed in accordance with the PDIC rules simply because the petition was filed beyond the thirty (30)-day reglementary period prescribed under RA 10846." — This passage states the decisive ground for denying the alternative prayer: the petition was time-barred, rendering the assailed ruling final.

• Gios-Samar, Inc. vs. Department of Transportation and Communications, G.R. No. 217158, March 12, 2019 — Cited for the proposition that BP 129 granted the Court of Appeals original jurisdiction to issue extraordinary writs, and for the doctrine of hierarchy of courts as a general determinant of the appropriate forum for petitions for extraordinary writs.
• People vs. Cuaresma — Cited within the Gios-Samar quotation for introducing the concept of "hierarchy of courts," reminding litigants to refrain from directly filing petitions for extraordinary writs before the Supreme Court unless there are special and important reasons.
• Saint Mary Crusade to Alleviate Poverty of Brethren Foundation, Inc. vs. Judge Riel, 750 Phil. 57 (2015) — Cited for reinforcing the doctrine that direct resort to the Supreme Court for extraordinary writs is allowed only when there are special, extraordinary, or compelling reasons, and that the Court enforces observance of the hierarchy of courts to free itself from unnecessary cases.
• Peter L. So vs. Philippine Deposit Insurance Corp., G.R. No. 230020, March 19, 2018 — Controlling precedent cited for the holding that a petition for certiorari questioning PDIC's denial of a deposit insurance claim should be filed before the Court of Appeals, not the RTC, as confirmed by Section 4 of Rule 65 of the Rules of Court, Section 22 of the PDIC Charter, and Section 5(g) as amended by RA 10846.

• Section 9, Batas Pambansa Blg. 129 (Judiciary Reorganization Act of 1980), as amended by RA No. 7902 — Vests in the Court of Appeals original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas corpus, and quo warranto, whether or not in aid of its appellate jurisdiction. Applied to establish that the CA has concurrent jurisdiction with the RTC and the Supreme Court over special civil actions for certiorari, and that the law does not distinguish between factual, legal, or mixed issues for jurisdictional purposes.
• Section 5(g), RA 3591 (PDIC Charter), as amended by RA 10846 — Provides that PDIC actions on matters relating to insured deposits shall be final and executory and may only be restrained or set aside by the Court of Appeals upon appropriate petition for certiorari under Rule 65, filed within thirty (30) days from notice of denial. Applied to determine that the CA is the proper forum for assailing PDIC rulings and that petitioner's filing was beyond the reglementary period.
• Section 4, Rule 65, Rules of Court, as amended by A.M. No. 07-7-12-SC — Provides that if a petition for certiorari involves an act or omission of a quasi-judicial agency, unless otherwise provided by law or these rules, the petition shall be filed with and be cognizable only by the Court of Appeals. Cited in Peter L. So as supporting the conclusion that certiorari against PDIC should be filed with the CA.
• Section 22, PDIC Charter (RA 3591), as amended — States that no court, except the Court of Appeals, shall issue any temporary restraining order, preliminary injunction, or preliminary mandatory injunction against the Corporation for any action under the Act. Cited as further support for the CA's exclusive jurisdiction over remedies against PDIC actions.
• Sections 4(b) and 4(c), PDIC Regulatory Issuance No. 2011-03 — Referenced by petitioner as providing for the opportunity to submit additional documents and clarificatory meetings in the event of incomplete submissions. Petitioner alleged PDIC failed to comply with these procedures.

Peralta, C.J. (Chairperson), Caguioa, J. Reyes, Jr., and Inting, JJ. concurred. (Lazaro-Javier, J. was the ponente.)