Is It Final? Steel Corporation of the Philippines Placed Under Liquidation Proceedings

The Steel Corporation of the Philippines (SCP) seems to have given up hope of rising up again from the corporate woes it is facing after the court has decided to place it under liquidation proceedings.

Batangas City Regional Trial Court (RTC) Branch-3 Judge Ruben Galvez issued a decision favouring the liquidation proceedings, which lead for the legal counsels of SCP to asked permission to leave the court room and staged a walk-out to protest something they believed as an unfair decision of what they described as a “kangaroo court.”

The court immediately held an election to determine the members of the Board of Liquidation of the said company.

Atty. Nonnatus Chua, one of the lawyers of SCP, insisted that the liquidation proceedings order from Judge Galvez is illegal because there are still a lot of prejudicial issues that were left hanging and were not considered by the court.

“We have several prejudicial issues which must be resolved first. In the case of liquidation, it must come after the order of such liquidation becomes final. After approval of the rehabilitation plan by the lower court, the remedy is Rule 65 and a Motion for Reconsideration… we still have 15 days to file MR but the court did not take this into consideration,” Chua explained.

Moreover, Chua said the court has yet to clarify the confusion regarding the classification of creditors.

Aside from Banco De Oro (BDO), there are other creditor banks which has loaned SCP like Planters Bank, Chinabank, Land Bank of the Philippines at DEG (Deutsche Investitions-und Entwicklungsgesellschaft).

All banks enumerated are “secured creditors.” However, while the court hearing was being held, some of the lawyers of the said banks appealed as to how and why they were classified as “unsecured creditors.”

“Samakatuwid ay hindi accurate ang ginawang pag-classify sa bawat creditors. Paano naman natin masasabing parehas ang desisyon ng korte gayong sa pag-classify pa lamang ng mga creditors ay sablay na sila. To put order in this proceedings we should comply with the mandatory requisites,” Chua added.

He also noted that there is a big difference on the rights and responsibilities between a “secured” at “unsecured” creditor thus it is very important to determine their correct classification.

SCP is the only 100% Filipino-owned steel company in the country.

The lawyers of SCP have filed a number of Motion for Reconsideration (MR) but they felt that they have not received proper attention and consideration from the court. They are also asking Judge Galvez to inhibit from the case if he has delicadeza.

“Ang ipinagtataka namin ay kung bakit napakabilis ng desisyon niya na i-deny ang motion namin na i-suspend muna ang liquidation. Biro mo, last Friday lang namin yun inihain, tapos on the same day, dineny agad niya ito. At yung kanyang desisyon na inilabas pabor sa liquidation, parang prepared na rin at matagal na niyang ginawa.” Chua lamented.

2 comments for “Is It Final? Steel Corporation of the Philippines Placed Under Liquidation Proceedings

  1. Jane Ritz
    December 12, 2012 at 9:11 am

    The steel industry in the Phillipians seems to be following that in the US. I visited some foundries years ago and now they’re either closed or on the brink of bankruptcy. In the Phillipians it sounds like the laws are pushing it out of business

  2. Karen Hand
    December 17, 2012 at 6:45 am

    I will admit that I am not familiar with the laws in the Phillipians; however, do they not have an option to appeal the decision to a higher court? There is a big difference in the classification of whether a creditor is classified as “secured” or “unsecured” as a secured creditor will be an entity that is guaranteed payment (or a portion of what is owed to them), whereas an unsecured creditor, more than likely, will not receive any compensation whatsoever.

Leave a Reply

Your email address will not be published. Required fields are marked *