FACTS:

On August 23, 2006, Doña Adela Export International, Inc., filed a Petition for Voluntary Insolvency. The RTC declared petitioner as insolvent and stayed all civil proceedings against petitioner. Atty. Arlene Gonzales was appointed as receiver and filed a Motion for Parties to Enter Into Compromise Agreement. The agreement proposed the assignment of remaining assets to creditors and the discharge of petitioner's debts. Petitioner entered into a Dacion En Pago by Compromise Agreement with Technology Resource Center (TRC) and transferred a parcel of land to TRC. TIDCORP and BPI filed a Joint Motion to Approve Agreement, agreeing to accept machineries as settlement for petitioner's debt.

This case involves a Dacion En Pago by Compromise Agreement executed by Dona Adela Export International, Inc. (petitioner) and Technology Resource Center (TRC). The agreement states that certain machineries valued at P350,000.00 shall be divided equally between TIDCORP and BPI. TIDCORP and BPI agree that acceptance of the settlement shall constitute payment of petitioner's obligation under the Insolvency Act, but such payment shall not affect their claims against the sureties and/or guarantors.

The agreement further provides that all necessary expenses, fees of the receiver, documentation and notarization, as well as fees incurred in connection to the implementation of the agreement, shall be for the account of Mr. Epifanio C. Ramos, Jr. The taxes and fees incurred, including gross receipts tax, shall be for the account of the petitioner.

The petitioner and its Board of Directors waive their rights to confidentiality under the Law on Secrecy of Bank Deposits and the General Banking Law of 2000, granting TIDCORP and BPI access to their bank accounts. The petitioner also authorizes TIDCORP and BPI to delegate their powers and authority to other persons when necessary.

The petitioner shall indemnify and hold TIDCORP and BPI, their respective Board of Directors, and officers free and harmless from any liability or claim arising from the agreement.

Epifanio Ramos, Jr. filed a motion stating that since the petitioner has a separate and distinct personality from its stockholders and officers, he should not be held liable for the expenses and taxes related to the auction or distribution of the machineries.

Attorney Arlene T. Gonzales, the receiver, filed a manifestation and comment stating that she is entitled to payment of administrative expenses and receiver's fees amounting to P740,200.00. She waived the fees due from TIDCORP and BPI but requested payment from TRC. TRC requested that the receiver's fee be reduced to P106,000.00, which Attorney Gonzales accepted.

The RTC approved the Dacion En Pago by Compromise Agreement and the Joint Motion to Approve Agreement, with certain exceptions. TRC was ordered to pay Attorney Gonzales the sum of P106,000.00 for the receiver's fees. The SEC was directed to remove petitioner Dona Adela Export International, Inc. from the list of registered legal entities.

The case involves a dispute between the petitioner, Manila Electric Company (MERALCO), and the respondent, Securities and Exchange Commission (SEC), regarding the appointment of a rehabilitator and the termination of insolvency proceedings. The RTC initially granted the petition filed by TIDCORP and BPI for the appointment of a receiver, who eventually became the rehabilitator. MERALCO subsequently requested the RTC to order the termination of the insolvency proceedings and release the receiver from her duties. MERALCO argued that it was not a party or signatory to the agreement between TIDCORP and BPI, which imposed various obligations on MERALCO. The RTC partially granted MERALCO's motion for reconsideration and held that MERALCO is entitled to due process before any obligations are imposed upon it based on the TIDCORP-BPI agreement.

ISSUES:

1. Whether the petitioner is bound by the provision in the BPI-TIDCORP Joint Motion to Approve Agreement that the petitioner shall waive its rights to confidentiality of its bank deposits under R.A. No. 1405 and R.A. No. 8791.

RULING:

1. The petitioner is not bound by the provision that waives its rights to confidentiality of its bank deposits.

   Reason The waiver of confidentiality provision was inserted in the Agreement between BPI and TIDCORP without the express and written consent of the petitioner, which is required under R.A. No. 1405. Petitioner was not a party or signatory to the said Agreement. Neither the petitioner's silence nor failure to object during the proceedings can be deemed as a waiver of its rights, as waivers must be knowingly and voluntarily made with full awareness of the circumstances and consequences.

PRINCIPLES:

• Doctrine of Relativity of Contracts Contracts bind only the parties who entered into them and cannot favor or prejudice a third person, even if the third person is aware of the contract and knows its terms.

• Waiver of Rights Waivers must be voluntary, knowingly, and intelligently made with sufficient awareness of the relevant circumstances and likely consequences. Mere silence or failure to act does not necessarily constitute a waiver.

• Law on Secrecy of Bank Deposits (R.A. No. 1405) Bank deposits are of absolutely confidential nature and may not be examined or disclosed except under specific circumstances, including the depositor's written consent.

• Insolvency Law Upon the declaration of insolvency, all property and estate of the insolvent debtor are vested in the appointed receiver or assignee. Any waiver concerning the properties of the insolvent must have the receiver's approval and conformity.