ABC, Inc is indebted to DEF Bank in the amount of P10,000,000.00.  The loan was secured by a suretyship agreement issued by J Insurance Co.  Due to ABC, Inc.'s default, DEF Bank filed a case against J Insurance Co as surety.  There is also a pending criminal case for violation of the Bouncing Checks Law against the President of ABC, Inc, Mr. Perfecto, who signed the check as signatory for the company. 

 

Unable to meet its obligations as they fell due, ABC, Inc filed a petition for rehabilitation.  Finding the petition sufficient in form and substance, the court issued a Commencement Order, which was thereafter published.

 

1. Should the case filed against J Insurance Co be suspended in light of the Commencement Order? Explain.

Answer rating: 100% (QA)

The filing of a petition for rehabilitation by ABC Inc and the issuance of a Commencement Order by t... View the full answer