Siochi Fishery Inc. V BPI

Brixton Vincent G.
Reyes
G.R. No. 193872 October 19, 2011

Siochi Fishery Enterprises Inc., et. al. v. BPI
J. Carpio
Doctrine:
As an officer of the court and an expert, the rehabilitation receiver

plays an important role in corporate rehabilitation proceedings. The
petition for rehabilitation and rehabilitation plan should be referred
to such person.
According to the Interim Rules of Procedure on Corporate
Rehabilitation, a liquidation analysis that estimates the proportion
of the claims that the creditors and shareholders would receive if
the debtors properties were liquidated is required.
A corporation has a legal personality distinct from its stockholders
and directors.
A corporation undergoing rehabilitation must have concrete material
financial commitments in its rehabilitation plan.
Facts:
Siochi Fishery Enterprises, Inc., Jun-Jun Fishing Corporation, Dede Fishing

Corporation, Blue Crest Aqua-Farms, Inc. and Iloilo Property Ventures, Inc. (P)
are domestic corporations of the Siochi family with principal office at Malabon
City.
In the course of their business, P borrowed from Bank of the Philippine Islands
(R) and from Ayala Life Assurance, Inc. Ps total obligation amounted to
P85,362,262.05.
P then filed shortly afterwards with the RTC a petition for corporate
rehabilitation.
RTC: Ruled in Ps favor and approved the petition.
P were net worthy since it had properties amounting to P393,922,000.00 that

can pay off the P79,848,920.23 debt to R.
Ps rehabilitation plan is feasible since a moratorium period of 5 years on the
payment of its loans/obligations will enable P to generate additional
capital/funds to continue its business operations.
CA: Ruled in Rs favor and Reversed the RTC decision.
The lower court committed a prime procedural infirmity in its failure to refer
Ps petition for rehabilitation and Rehabilitation Plan to the rehabilitation
Brixton Vincent G. Reyes
receiver despite the explicit and clear mandate of the Interim Rules that if the
court is satisfied that there is merit in the petition, it shall give due course to
the petition and immediately refer the same and its annexes to the
rehabilitation receiver.
Rs material financial commitments are not concrete. Firstly, the sourcing of
funds from their internal operations is based on a mere expectancy. Secondly,
P failed to give the specific details regarding their prospective investors who
will supposedly put up additional fresh capital. Thirdly, by stating that their
real estate properties have not been exposed to the limit of their loan values,
P are implying that they will use the mortgaged properties as collaterals to
secure a different loan.
Issue:
Whether Ps petition for rehabilitation may be approved.
Ruling:
No.
In the present case, the RTC hastily approved the rehabilitation plan in the
same order giving due course to the petition making an erroneous procedural
shortcut. The RTC confined the initial hearing to the issue of jurisdiction and
failed to address other more important matters relating to the petition and
comment. The RTC also failed to refer for evaluation the rehabilitation plan to
the rehabilitation receiver. Thus, the rehabilitation receiver was unable to
submit his recommendations and make modifications or revisions to the
rehabilitation plan as necessary.
P failed to include a liquidation analysis in their rehabilitation plan.
P do not own all of the properties with a total estimated value of
P393,922,000 so they cannot pay the loan off. Some of the properties are
owned by Ferdinand, Gerald and Jose Patrick Siochi, and Mario Siochi, Jr., not
by P. A corporation has a legal personality distinct from its stockholders and
directors.
As stated before, Ps material financial commitments arent concrete such as
the sourcing of funds from their internal operations is based on a mere
expectancy and their failure to give the specific details regarding their
prospective investors who will supposedly put up additional fresh capital.

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Brixton Vincent G.

G.R. No. 193872 October 19, 2011

As an officer of the court and an expert, the rehabilitation receiver

Siochi Fishery Enterprises, Inc., Jun-Jun Fishing Corporation, Dede Fishing

RTC: Ruled in Ps favor and approved the petition.

P were net worthy since it had properties amounting to P393,922,000.00 that

CA: Ruled in Rs favor and Reversed the RTC decision.

Whether Ps petition for rehabilitation may be approved.

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