Petitioners opened and maintained both time and savings deposits with herein respondent bank. Upon maturity of some of their time deposit certificates, petitioners were not able to cash them but instead were issued a manager’s check which was dishonored upon presentment. Demands for the payment of deposits having failed, petitioners moved for the issuance of a writ of preliminary attachment for collection of a sum of money. Respondent Judge ordered the issuance of a writ and later, rendered judgment in favor of petitioners. Meanwhile, the Monetary Board finding that respondent bank was insolvent, decided to place it under receivership. Petitioners then moved for the execution which was granted, but was subsequently stayed upon reconsideration. Petitioners moved to lift the stay but were denied. Hence, the instant petition.
Whether or not the stay of execution of judgment against a bank placed under receivership is valid.
In the instant case, the stay of the execution of judgment is warranted by the fact that respondent bank was placed under receivership. To execute the judgment would unduly deplete the assets of respondent bank to the obvious prejudice of other depositors and creditors, since, as aptly stated in Central Bank of the Philippines vs. Morfe, after the Monetary Board has declared that a bank is insolvent and has ordered it to cease operations, the Board becomes the trustee of its assets for the equal benefit of all the creditors, including depositors. The assets of the insolvent banking institution are held in trust for the equal benefit of all creditors, and after its insolvency, one cannot obtain an advantage or a preference over another by an attachment, execution or otherwise.
The instant petition is hereby DISMISSED.