I'm Giancarlo Enrico S. Pozon, a Wushu instructor, investor and Barrister... That's right, Barrister; I graduated from law school and took the Bar Exams, now I'm waiting for the results. I created this blog to make Philippine Law easy to understand for the average person. It's all about free legal advice. There are many law blogs. But the problem is that many of them are written for lawyers and law students. They use words that can't be understood by ordinary people.
Many lawyers, judges and law students consider themselves as superior to most human beings because of their knowledge of the law. It bothers me since the law is supposed to serve society. Since the law is meant to serve society as a whole, it is important that is must be understood by everybody.
This does not mean that we should all become lawyers. It means that although law is a highly specialized profession, the first duty of everybody in this profession is to make the law understandable to all; that's why all these articles are free legal advice.
Like I said, this blog is about law -but it's for the ordinary people, not the lawyers. It's for the ordinary folk so they will know what is good and bad for them, and that making them aware of the law will help us all improve society as a whole. This is free legal advice for everybody!
The following is a list
of proceedings under the Financial Rehabilitation and Insolvency Act (RA 10142)
and the pertinent parties:
1.) Voluntary
Rehabilitation/Debtor-initiated Rehab
For voluntary rehab of
a sole proprietorship, it’s the owner who will approve or file the petition. In
case of a partnership, it has to be the majority of the partners. For a
corporation, the petition must be approved/filed by the majority of the board
of directors/trustees as well as stockholders representing 2/3 of the outstanding
capital stock, or 2/3 of the members in case of non-stock corporations.
2.) Involuntary
Rehabilitation/Creditor-initiated Rehab
For the involuntary rehab of a sole
proprietorship, partnership or corporation, the petition must be filed/approved
by a creditor or group of creditors with a claim or aggregate claim equal to at
least 25% of the subscribed capital stock/partners’ contributions or at least
Php1,000,000.00 –whichever is higher.
3.) Pre-Negotiated Rehab
This is for the
petition for the approval of the pre-negotiated rehab plan and applies to sole
proprietorships, partnerships and corporations. The insolvent debtor and the
rehab plan must be approved by creditors holding at least 2/3 of the debtor’s
total liabilities including secured
creditors holding more than 50% of the secured claims and unsecured creditors
holding more than 50% of the unsecured claims.
4.) Voluntary Liquidation
An insolvent debtor in
a partnership, sole proprietorship or corporation will file/approve the
petition for voluntary liquidation.
5.) Involuntary Liquidation
This covers
corporations, sole proprietorships and partnerships. The petition must be
filed/approved by 3 or more creditors with an aggregate claim of at least
Php1,000,000.00 or 25% of the outstanding capital stock/partner’s contributions
–whichever is higher.
6.) Suspension of Payment
The individual debtor
files/approves the petition.
7.) Voluntary Liquidation
The individual debtor
files/approves. He must have at least Php500,000.00 in debts and doesn’t have
sufficient assets to pay his liabilities.
8.) Involuntary Liquidation
The subject is once
again the individual debtor and the petition is for acts of insolvency. The
petition is filed by a creditor/group of creditors whose claim/aggregate claim
is at least Php500,000.00.
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