PDIC Deposit Insurance Disputes: Court of Appeals Has Exclusive Jurisdiction

When the Philippine Deposit Insurance Corporation (PDIC) denies a claim for deposit insurance, where should the claimant go to challenge that decision? The Supreme Court has settled this question: the Court of Appeals, not the Regional Trial Court, is the proper forum.

In Servo v. Philippine Deposit Insurance Corporation (G.R. No. 234401, December 5, 2019), the Court clarified the jurisdictional rules governing disputes over PDIC's denial of deposit insurance claims. The ruling is essential reading for depositors of closed rural banks and their counsel.

The Case

Connie Servo claimed she lent P500,000 to Teresita Gutierrez in 2011. When Gutierrez repaid the loan in January 2012, Servo opened a time deposit account with the Rural Bank of San Jose Del Monte. Gutierrez's name appeared as the account holder because she was a preferred bank client, but Servo claimed she was the true owner of the funds.

When the bank closed, Servo filed a claim for deposit insurance with PDIC. PDIC denied the claim, stating there were no bank records showing Servo owned the account. Servo's request for reconsideration was likewise denied in July 2015.

Servo then filed a petition for certiorari with the Regional Trial Court, alleging grave abuse of discretion by PDIC. The trial court dismissed the case for lack of jurisdiction, ruling that PDIC's actions should be challenged before the Court of Appeals under Section 5(g) of Republic Act No. 3591, as amended by RA 10846.

Servo next filed a petition for certiorari with the Court of Appeals. But the appellate court also dismissed it—this time on the ground that since the case involved a pure question of law, it should have been filed directly with the Supreme Court under Rule 45.

The Issue

Did the Court of Appeals err in dismissing Servo's petition for certiorari on the ground of lack of jurisdiction?

The Ruling

The Supreme Court held that the Court of Appeals erred in dismissing the petition on that ground. Under Section 9 of Batas Pambansa Bilang 129, the Court of Appeals has original jurisdiction to issue writs of certiorari, mandamus, prohibition, habeas corpus, and quo warranto. This jurisdiction is concurrent with the Regional Trial Courts and the Supreme Court.

The Court emphasized that the law does not distinguish between pure questions of fact, pure questions of law, or mixed questions when determining which court should take cognizance of a petition for certiorari. The doctrine of hierarchy of courts dictates that petitions for extraordinary writs should generally be filed with the lower courts first, not directly with the Supreme Court.

However, the Court declined to remand the case to the Court of Appeals, choosing instead to resolve the jurisdictional issue once and for all.

The Correct Forum for PDIC Disputes

The Court ruled that petitions questioning PDIC's denial of deposit insurance claims must be filed with the Court of Appeals. This is based on:

• Section 5(g) of RA 3591, as amended by RA 10846, which states that PDIC's actions on matters relating to insured deposits are final and executory, and may only be restrained or set aside by the Court of Appeals through a petition for certiorari on the ground of grave abuse of discretion. The petition must be filed within 30 days from notice of denial of the claim.

• Section 22 of the PDIC Charter, which provides that no court except the Court of Appeals may issue any temporary restraining order, preliminary injunction, or preliminary mandatory injunction against PDIC.

• Section 4, Rule 65 of the Rules of Court, which states that if the petition involves an act or omission of a quasi-judicial agency, the petition shall be filed with and be cognizable only by the Court of Appeals.

The Timeliness Requirement

The Court also addressed Servo's alternative prayer to have her petition treated as an original action against PDIC. This could not be granted because her petition was filed beyond the 30-day reglementary period. Her request for reconsideration was denied on July 16, 2015, but she filed her petition with the Court of Appeals only on September 7, 2017—more than two years later.

Practical Takeaways

• File with the Court of Appeals, not the RTC. A petition for certiorari questioning PDIC's denial of a deposit insurance claim must be filed with the Court of Appeals, not the Regional Trial Court.

• Observe the 30-day deadline. Under RA 10846, the petition for certiorari must be filed within 30 days from notice of the denial of the deposit insurance claim. Missing this deadline is fatal.

• Understand the effect of RA 10846. The amendatory law, which took effect on June 11, 2016, applies to petitions filed after its effectivity, even if the claim was denied before that date.

• Respect the hierarchy of courts. While the Supreme Court, Court of Appeals, and RTCs have concurrent jurisdiction over petitions for certiorari, litigants should generally file with the lower courts first.

• Seek legal advice promptly. Because of the short 30-day period, depositors whose claims are denied should consult counsel immediately to avoid losing their remedy.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.