GSIS FAMILY BANK – THRIFT BANK [Formerly Inc.], Petitioner, vs. BPI FAMILY BANK, Respondent.
FACTS
Petitioner, originally Royal Savings Bank, was reorganized and renamed Comsavings Bank, Inc. after liquidity problems. In 1987, the Government Service Insurance System (GSIS) acquired it. To improve marketability, petitioner sought and obtained approvals from the Department of Trade and Industry (DTI) and Bangko Sentral ng Pilipinas (BSP) to operate under the business name “GSIS Family Bank a Thrift Bank.” Respondent BPI Family Bank originated from the merger between Family Bank and Trust Company (FBTC) and Bank of the Philippine Islands (BPI). FBTC, incorporated in 1969, was commonly known as “Family Bank.” After the 1985 merger, BPI acquired all rights to the name, and its subsidiary registered the trade name “BPI Family Bank,” building a reputation and goodwill under it. Respondent petitioned the SEC Company Registration and Monitoring Department (SEC CRMD) to disallow petitioner’s use of “GSIS Family Bank,” claiming exclusive ownership of “Family Bank” due to prior adoption and acquisition through merger. The SEC CRMD ruled for respondent, directing petitioner to refrain from using “Family” in its name. The SEC En Banc and the Court of Appeals affirmed this decision.
ISSUE
Whether the corporate names “BPI Family Bank” and “GSIS Family Bank” are confusingly or deceptively similar under Section 18 of the Corporation Code, warranting the prohibition of petitioner’s use of “Family” in its name.
RULING
Yes. The Supreme Court upheld the Court of Appeals’ decision. The two requisites under Section 18 of the Corporation Code and jurisprudence are present. First, respondent acquired a prior right to the use of “Family Bank.” Applying the rule of priority of adoption and registration, respondent’s predecessor, FBTC, began using “Family Bank” in 1969, long before petitioner sought to use “GSIS Family Bank” in 1987. Respondent’s continuous use and registration of the trade name established its prior right. Second, the proposed name is deceptively or confusingly similar. Both entities are engaged in the banking industry. The inclusion of “Family Bank” in both names, with only the prefixes “BPI” and “GSIS” differentiating them, is likely to cause confusion among the public as to their association, especially since “GSIS” is a well-known government institution. The Court rejected petitioner’s arguments that the DTI and BSP approvals authorized its use, holding that the SEC has absolute jurisdiction over corporate names. The Court also found no forum shopping by respondent, as the actions before different agencies involved different causes of action and reliefs. The BSP’s opinion on lack of deception was not binding on the SEC’s jurisdiction. Therefore, petitioner was prohibited from using “Family” in its corporate name.
