The Supreme Court (SC) of the Philippines has denied a petition for review filed by Prudentialife Plans Inc (PPI) and its planholders, assailing the decision and resolution of the Court of Appeals dated 29 August 2014 and 10 June 2015, respectively.
The SC’s First Division denied the petition for review on certiorari on the ground that the petitioners failed to sufficiently show that the Court of Appeals committed any reversible error in affirming the directors fo the Insurance Commission (IC) dated 19 September 2013 and 19 October 2012.
Accordingly, the SC denied the application for issuance of a temporary restraining order and/or writ of preliminary injunction seeking to stop the implementation of the liquidation order issued by the IC.
The Court of Appeals, in its 29 August 2014 decision, dismissed the petition filed by PPI and its planholders assailing the 19 September 2012 directive of the IC, which terminated the convervatorship of PPI and placing the company under receivership; and the 19 October 2012 directive of the IC, which terminated PPI’s receivership and ordering the company’s liquidation.
Contrary to the argument of PPI, the Court of Appeals held the IC’s order placing PPI under receivership is justified, valid and well founded as there is ample evidence showing that PPI is insolvent based on the financial examination reported prepared by the IC at the time when PPI was still under conservatorship.
The Court of Appeals noted that the financial condition of PPI was on a downward trend from 2007 to 2011 and has worsened as demonstrated by the fact that deficiency of PPI as of 2011 amounted to P12.3 billion.
It likewise noted that the debt to asset ratio of the company as of 2008 is greater than 1 and has increased over the years, indicating the difficulty on the part of PPI to pay its obligations as they fell due.
IC Commissioner Emmanuel Dooc lauded the decision of the SC as it affirms with certainty the power of the IC provided under the Pre-Need Code of the Philippines to take over troubled pre-need companies whose continued operations may be financially hazardous to the public by placing it under conservatorship, receivership, or liquidation.