PACIFIC BANKING CORPORATION EMPLOYEES ORGANIZATION v. CA
The trial court ordered payment
G.R. No. 109373, March 20, 1995
Ponente: MENDOZA, J.
TOPIC: Other Special Proceedings [no longer covered by this course;
will be
discussed just to give a more complete picture of the nature of
Special
Proceedings are]
DOCTRINE:
A petition for liquidation of an insolvent corporation should be
classified a special proceeding and not an ordinary action. Such
petition does not seek the enforcement or protection of a right nor
the prevention or redress of a wrong against a party. It does not pray
for affirmative relief for injury arising from a party's wrongful act or
omission nor state a cause of action that can be enforced against any
person. What it seeks is merely a declaration by the trial court of the
corporation's insolvency so that its creditors may be able to file their
claims in the settlement of the corporation's debts and obligations.
Put in another way, the petition only seeks a declaration of the
corporation's state of insolvency and the concomitant right of
creditors and the order of payment of their claims in the disposition
of the corporation's assets.
FACTS:
 Central Bank filed with the Regional Trial Court of Manila, Branch
31, a petition entitled "Petition for Assistance in the Liquidation
of Pacific Banking Corporation."
 The Pacific Banking Corporation Employees Organization (Union
for short), petitioner filed a complaint-in-intervention seeking
payment of their benefits due.
of the principal claims of the Union.
 Respondent judge disallowed the Liquidator's Notice of Appeal
on the ground that it was late, i.e., more than 15 days after
receipt of the decision.
 Ang Keong Lan and E.J. Ang Int'l., private respondents, likewise
filed claims for the payment of investment in the PaBC allegedly
in the form of shares of stocks. RTC directed the Liquidator to pay
private respondents the total amount of their claim as preferred
creditors.
 The judge ordered the Notice of Appeal stricken off the record on
the ground that it had been filed without authority of the Central
Bank and beyond 15 days.
 The 5th Division of the CA rendered the proceeding in the Union
case as a special proceeding, therefore the appeal is 30 days.
However the 14th Division rendered with respect to the
stockholder’s case as an ordinary action, therefore period of
appeal is within 15 days. Accordingly dismissing the liquidator’s
petition.
ISSUE/S:
Whether a petition for liquidation under §29 of Rep. Act No. 265 is in
the nature of a special proceeding? --YES
HELD:
 We disagree with the foregoing view of the Fourteenth Division.
Rule 2 of the Rules of Court provide: §1. Action defined .
Action means an ordinary suit in a court of justice, by which one
party prosecutes another for the enforcement or protection of a
right, or the prevention or redress of a wrong. §2.
Special proceeding distinguished. — Every other remedy, including
one to establish the status or right of a party or a particular fact,
shall be by special proceeding.

 A petition for liquidation of an insolvent corporation should be

classified a special proceeding and not an ordinary action.
 Such petition does not seek the enforcement or protection of a
right nor the prevention or redress of a wrong against a party. It
does not pray for affirmative relief for injury arising from a
party's wrongful act or omission nor state a cause of action that
can be enforced against any person.
 What it seeks is merely a declaration by the trial court of the
corporation's insolvency so that its creditors may be able to file
their claims in the settlement of the corporation's debts and
obligations.
 Put in another way, the petition only seeks a declaration of the
corporation's state of insolvency and the concomitant right of
creditors and the order of payment of their claims in the
disposition of the corporation's assets.

DISPOSITIVE PORTION / RULING:

WHEREFORE, in G.R. No. 109373 and G.R. No. 112991, the

decisions appealed from are AFFIRMED.