Court orders liquidation of steel firm
THE REGIONAL Trial Court of Batangas City has ordered the liquidation of Steel Corporation of the Philippines (SCP), saying its rehabilitation was no longer feasible.
In an order issued on Sept. 19, the Batangas RTC ruled out rehabilitation and declared SCP as insolvent and dissolved.
The court also ordered the sheriff of the RTC in Batangas City to take possession and control of all the properties of SCP, except those that might be exempted from execution.
Accordingly, the sheriffs have implemented the court order and taken possession of the company’s assets.
SCP, however, vowed to contest the “arbitrary and capricious order by the judge.”
“That order is not yet final and was made in contempt of the Supreme Court where the issue of whether to terminate the rehab case is pending. The order of the judge preempts any ruling by the Supreme Court in said case, thus, contemptuous. We will avail of all our legal remedies to contest this arbitrary and capricious order by the judge,” said lawyer Nonnatus Chua, counsel for SCP.
In its order, the court directed payments of any claims and conveyance of any property due SCP to the liquidator; prohibit- ed payments and transfer of any property by SCP; directed all creditors to file their claims with the liquidator within the period set by the rules of procedure, and authorized the payment of administrative expenses as they become due.
SCP’s creditor banks include Planters Bank, Chinabank, Land Bank of the Philippines, Banco de Oro and DEG (Deutsche Investitions-und Entwicklungsgesellschaft).
In its order, the RTC also noted that the continued operations of SCP was threatened by nonpayment of customs duties and other taxes. It also said the actual result of business operations and financial condition of SCP could not support the amortization schedule of the restructured debts in the approved rehab plan.
In addition, the court noted that SCP had not complied with the provisions of the approved rehab plan and with the orders of the rehabilitation court.