In a dispute between Banco Filipino Savings and Mortgage Bank (BFSMB) and Bangko Sentral ng Pilipinas (BSP), the Supreme Court ruled that BFSMB’s petition to revive a 1991 judgment was filed beyond the prescriptive period and that BSP had already complied with the original judgment by allowing BFSMB to resume operations. This means that a judgment cannot be revived if the petition is filed more than ten years after the judgment became final, and if the obligations under the judgment have already been fulfilled.

From Closure to Compliance: Did BSP Fulfill Its Promise to Banco Filipino?

The legal saga began with the closure of BFSMB in 1985, which was later annulled by the Supreme Court in 1991. The Court ordered the Central Bank (CB), now BSP, to reorganize BFSMB and allow it to resume business. BFSMB reopened in 1994 under BSP’s comptrollership. However, in 2004, BFSMB filed a petition to revive the 1991 judgment, claiming that BSP had not fully complied with the order to reorganize the bank. BSP countered that the petition was filed beyond the prescriptive period and that it had already complied with the judgment. The Regional Trial Court (RTC) initially denied BSP’s motion to dismiss, but the Court of Appeals (CA) issued conflicting decisions. One division affirmed the RTC’s decision, while another ordered the dismissal of BFSMB’s petition.

The Supreme Court consolidated the two CA decisions to resolve the conflicting rulings. The primary issue before the Court was whether BFSMB’s petition for revival of judgment was filed within the prescribed period and whether BSP had already complied with the original judgment. Section 6, Rule 39 of the Rules of Court, states that a judgment can be executed on motion within five years from its entry. After this period, it can only be enforced by action before it is barred by the statute of limitations.

Furthermore, Articles 1144 and 1152 of the Civil Code provide a ten-year period from the time the right of action accrues. This means that an action upon judgment must be brought within ten years from the time the judgment became final.

In this case, the Court held that BFSMB’s petition was filed more than 12 years after the 1991 judgment became final. BFSMB argued that the enactment of Republic Act No. 7653 (The New Central Bank Act of 1993) tolled the prescriptive period because it created uncertainty as to whom the judgment should be enforced against. However, the Court disagreed, stating that RA No. 7653 clearly identified the entities where the assets and liabilities of the Central Bank were transferred.

First of all, contrary to BF’s proposal, there was no vacuum created with the passage of R.A. 7653 that would render BF uncertain as against whom it can enforce its rights. All powers, duties and functions vested by law in the Central Bank of the Philippines were deemed transferred to the BSP. The law provides that all references to the Central Bank of the Philippines in any law or special charters shall be deemed to refer to the BSP.

Even if the issue of prescription was disregarded, the Court ruled that the petition should still be dismissed because BSP had already complied with the judgment obligation. An action to revive judgment aims to enforce a judgment that can no longer be enforced by mere motion. The Court emphasized that the judgment in G.R. No. 70054 ordered CB-MB to reorganize BFSMB and allow it to resume business under the comptrollership of CB-MB, subject to conditions prescribed by the latter.

BFSMB argued that the reorganization was incomplete and that BSP should have restored its branch network and provided financial assistance. However, the Court found that the judgment did not specify how CB-MB was to reorganize BFSMB or what conditions should be imposed.

In fact, the Court also cited the Memorandum of Agreement entered into by and between BSP and BFSMB categorically stated the fact that the former had already complied with the Decision in G.R. No. 70054.

WHEREAS, on December 6, 1993, the BANGKO SENTRAL, through its Monetary Board, complied with the decision of the Supreme Court by authorizing BANCO FILIPINO to resume business under BANGKO SENTRAL comptrollership, and that on July 1, 1994, BANCO FILIPINO re-opened its doors to the public and has, since then, been publicly and actively engaged in the banking business[.]

Therefore, the Court concluded that BSP had complied with its obligations by allowing BFSMB to reopen and operate under its comptrollership until January 20, 2000. The Court also stated that an action for revival of judgment cannot modify or alter the original judgment. The remedies sought by BFSMB, such as restoring its branch network and providing financial assistance, went beyond the scope of the original judgment and could not be compelled through a revival action.

Building on this principle, the Court recognized BSP’s independence and discretion in carrying out its mandate. Section 3 of Republic Act No. 7653, declares that: “The Bangko Sentral shall provide policy directions in the areas of money, banking, and credit. It shall have supervision over the operations of banks and exercise such regulatory powers as provided in this Act and other pertinent laws… The primary objective of the Bangko Sentral is to maintain price stability conducive to a balanced and sustainable growth of the economy. It shall also promote and maintain monetary stability and the convertibility of the peso.”

The Supreme Court thus reversed the CA decision that favored BFSMB and affirmed the decision that dismissed BFSMB’s petition. The Court reiterated the importance of adhering to the prescriptive periods for reviving judgments and respecting the independence of the BSP in its regulatory functions.

FAQs

What was the key issue in this case?	The key issues were whether BFSMB’s petition for revival of judgment was filed within the prescribed period and whether BSP had already complied with the original judgment.
What is the prescriptive period for reviving a judgment?	A judgment can be executed on motion within five years from its entry. After this period, it can only be enforced by action before it is barred by the statute of limitations, which is ten years from the finality of the judgment.
Did the enactment of RA No. 7653 toll the prescriptive period?	No, the Court held that RA No. 7653 did not create uncertainty as to whom the judgment should be enforced against, as it clearly identified the entities where the assets and liabilities of the Central Bank were transferred.
Had BSP complied with the original judgment?	Yes, the Court ruled that BSP had complied with its obligations by allowing BFSMB to reopen and operate under its comptrollership until January 20, 2000.
Can an action for revival of judgment modify the original judgment?	No, an action for revival of judgment cannot modify or alter the original judgment, which is already final and executory.
What was the scope of the original judgment in G.R. No. 70054?	The original judgment ordered CB-MB to reorganize BFSMB and allow it to resume business under its comptrollership, subject to conditions prescribed by CB-MB.
Did the judgment require BSP to restore BFSMB’s branch network and provide financial assistance?	No, the Court found that the judgment did not specify how CB-MB was to reorganize BFSMB or what conditions should be imposed, and therefore, these remedies went beyond the scope of the original judgment.
What is the significance of BSP’s independence in this case?	The Court recognized BSP’s independence and discretion in carrying out its mandate, emphasizing that the reliefs prayed for by BFSMB could not be mandated by judicial compulsion through a mere revival of judgment.

This case underscores the importance of adhering to the prescriptive periods for reviving judgments and respecting the independence of regulatory bodies like the BSP. It also clarifies the scope of an action for revival of judgment, emphasizing that it cannot be used to modify or expand the obligations imposed by the original judgment.

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Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: BANGKO SENTRAL NG PILIPINAS VS. BANCO FILIPINO, G.R. Nos. 178696 & 192607, July 30, 2018