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Suspend in Deference Case 3

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  Republic of the Philippines SUPREME COURT  Manil OFFICE OF THE COURT ADMINISTRATOR   ATTY. NONNATUS CHUA, in his capacity as duly authorized representative of STEEL CORPORATION OF THE PHILIPPINES, Complainant,    –  versus - Admin. Case No. ________ HON. JUDGE RUBEN GALVEZ in his capacity as Presiding Judge of Branch III, Regional Trial Court of Batangas City, Respondent.  x ————————————— x COMPLAINT  COMPLAINANT, through counsel respectfully avers as follows: THE PARTIES  1. COMPLAINANT is a Filipino, of legal age, the Vice President for Legal and the authorized representative of Steel Corporation of the Philippines (―Steel Corp‖ for brevity), a domestic corporation organized and existing under Philippine laws, with principal place of business at Km 104 Barangay Munting Tubig, Balayan, Batangas.[1] Complainant may be served with orders and notices, as well as   pleadings and motions through undersigned counsel. 2. Respondent HON. JUDGE RUBEN GALVEZ (―Respondent Galvez‖ for brevity) is a Filipino, of legal age and a member of the Judiciary. He is the Presiding Judge of the Regional Trial Court of Batangas City (the ―RTC‖), Branch III, located at Pallocan West, Bat angas City where he may be served with summons, notices, orders and other processes.    THE FACTS  3. Steel Corp is a 100% Filipino  – owned corporation engaged in the manufacture and production of cold-rolled coils (CRC) and high quality steel sheets. It owns the most modern and biggest integrated flat steel mill in the country today, built in 1998 and located in Balayan, Batangas. 4. While it enjoyed early successes upon the commencement of its commercial operations in 1999 and onwards, Steel Corp suffered setbacks brought about by factors entirely beyond its control, such as the 1997 Asian Financial Crisis and the sudden huge devaluation of the peso against the US dollar. These resulted in foreign exchange losses to Steel Corp of some PhP1.3 billion. 5. On 11 September 2006, while Steel Corp’s negotiations for a debt restructuring plan with its creditors were ongoing, Banco De Oro Unibank, (―BDO‖) , formerly Equitable PCI Bank, Inc.,   one of Steel Corp’s creditors, suddenly filed with the Regional Trial Court (―RTC‖) of Batangas City a creditor  -initiated petition to place Steel Corp under corporate rehabilitation. The case was docketed as Spec. Proc. No. 06-7993 and was raffled off to Branch 2, the designated special commercial court for the Province of Batangas, then presided by Judge Maria Cecilia I. Austria. 6. Around 15 months thereafter, in a Decision  dated 03 December 2007, the RTC approved what it referred to as the ―Recommended‖ Rehabilitation Plan of the then rehabilitation receiver.   Several parties, including Steel Corp, promptly challenged this Decision   before the Court of Appeals in four (4) separate petitions for review  under Rule 43, which were assigned to different divisions of the Court of  Appeals, and respectively docketed as follows: 1. CA-G.R. No. 101732 (Steel Corporation of the Philippines vs. Equitable PCI Bank, etc.); 1. CA-G.R. No. 101880 (DEG-Deutsche etc. vs. Steel Corporation of the Philippines et al.); 1. CA-G.R. No. 101881 (Equitable PCIBank Inc. vs. Steel Corporation of the Philippines; and,  1. CA-G.R. No. 101913 (Investments 2234 Philippines Inc. vs Equitable PCIBank Inc. et al.) 7. Meanwhile, in the RTC, Judge Ma. Cecilia Austria subsequently inhibited herself and the case was assigned to Judge Albert Kalalo who, in due course issued the following orders, among others: 1. Order dated 28 October 2009[2]  compelling the creditor-assignors who assigned their credits   and their respective assignees to disclose the actual assignment/transfer price pursuant to Art. 1634 of the Civil Code, which allows a debtor to release himself from debt by returning to the assignee whatever the amount the latter paid to the srcinal creditor/assignor for the acquisition of said debt; 1. Orders dated 12 November 2008[3], 07 January 2009[4] and 28 July 2010[5]  suspending the   rehabilitation proceedings due to the pendency of several appeals and the unresolved issue of the applicability of Art. 1634.  8. On 03 July 2008, the Twelfth Division of the Court of Appeals, acting on CA-G.R. SP No. 101881 (EPCIBank, Inc. vs. Steel Corp. of the Phils.), rendered a Decision[6]  setting aside the decision of the   rehabilitation court and ordering termination of the rehabilitation proceedings.  9. From this decision, Steel Corp and DEG both appealed to the Supreme Court in the consolidated cases of G.R. No. 190462 and 190538 where the Supreme Court eventually rendered a Decision on 17 November 2010[7], declaring that the Court of Appeals cannot motu proprio terminate the   proceedingsbecause none of the parties asked for such relief. The Supreme Court then remanded the   cases back to the Court of Appeals to be consolidated with CA-G.R. SP Nos. 101732, 101880 and 101913. 10. However, after accepting the remand and having all the appeals from the Decision dated 3 December 2007 consolidated, another Division of the Court of Appeals, in a Resolution dated 25 May 2012, refused to reconsider its earlier Decision in CA-G.R. SP No. 101732 terminating the rehabilitation proceedings.   11. Thus, Steel Corp was constrained to file another petition for review with the Supreme Court, subsequently docketed as G.R. Nos. 202006-09 praying the reversal of the termination order. THE SAID CASES ARE STILL PENDING WITH THE SUPREME COURT AS SHOWN BY THE RESOLUTION DATED 30 JULY 2012 [8] .     12. On 09 December 2010,[9] Judge Kalalo inhibited himself from presiding over the rehabilitation case   but sustained his Order dated 28 July 2010 suspending the proceedings in the rehabilitation case. 13. The case was then transferred to the RTC Branch 3 of Batangas City presided over by Respondent Judge Ruben Galvez. Judge Galvez then issued the Order   dated 22 March 2011[10] appointing Atty. Norma Singson-De Leon as the new rehabilitation receiver of Steel Corp. 14. Immediately upon receipt of the Order dated 22 March 2011, Steel Corp filed on 29 March 2011 an Urgent Manifestation and Motion  dated 28 March 2011, praying that the RTC enjoin Atty. Singson-De Leon from assuming and performing the duties and functions of receiver of Steel Corp in view of the pendency of the issue on whether or not there is a necessity of appointing a receiver, as raised in a Motion to Conduct Hearing   it previously filed. 15. Subsequently, Respondent Judge Galvez issued an Order   dated 04 May 2011[11], on Steel Corp’s Motion to Resolve Critical Pending Incidents , partially granting Steel Corp’s   Motion to Enforce/Implement Order   dated 28 October 2009 and directing the creditors of Steel Corp to disclose within the fifteen (15) days the actual price or consideration paid by them for Steel Corp’s  debts that were assigned, in connection with Article 1634 of the Civil Code.  16. Immediately the following day, Respondent Judge Galvez issued another Order dated 05 May 2011[12]  recalling the previous day’s Order.  In observance of judicial courtesy, Judge Galvez recalled   the 04 May 2011 Order considering the pendency of certiorari cases (CA-G.R. No. 111556, CA-G.R. No. 111560, CA-G.R. No. 112175) on the applicability of Article 1634. 17. Subsequently, Respondent Judge Galvez issued the Order   dated 09 May 2011[13] confirming   the appointment of Atty. Singson- De Leon as rehabilitation receiver and denying Steel Corp’s   Urgent Manifestation and Motion . 18. Naturally aggrieved by the issuance of the 09 May 2011 Order, Steel Corp was constrained to institute in the Court of Appeals a petition for certiorari   under Rule 65 of the Rules of Court to assail the Orders dated 22 March 2011 and 09 May 2011. The case is docketed as CA-G.R. SP NO. 119840 and pending at present.  
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