Ms. Flordeliza T. dela Cruz

July 15, 1988 Ms. Flordeliza T. dela Cruz CDCP Employees Savings and Loan Association, Inc. Ground Floor, Phase II PNCC Complex, EDSA Cor. Reliance St., Mandaluyong, Metro Manila Madam: This refers to your letter dated April 25, 1988, requesting clarification on what to do with inactive/unclaimed capital contributions of former members of CDCP Employees Savings and Loan Association, Inc. who have long been separated or have gone AWOL from Philippine National Construction Corporation (formerly CDCP) Group of Companies and whose whereabouts you are unable to trace despite diligent efforts on your part to locate them. You manifested that the matter was earlier referred to the Central Bank but it was suggested by CB in its letter of April 18, 1988 that you address your query instead to the Securities and Exchange Commission which allegedly has the exclusive jurisdiction on the matter. The by-laws of CDCP Employees Savings and Loan Association, Inc., provides that "upon cessation of membership, the association shall refund to the members, his/its authorized payee, heirs or assigns, the capital contribution, savings and time deposit, together with the interest and dividends earned, if any after deducting therefrom any loans outstanding or any other amounts due from him/it including guarantee obligations." (sec. 4) It would appear therefore that there is a "trust" established in the by-laws requiring the association to refund to the former members their contributions. In this connection the Civil Code of the Philippines, provides: "ARTICLE 1445. * No particular words are required for the creation of an express trust, it being sufficient that a trust is clearly intended." Capital contributions of former members of the Association, as well as their savings and time deposits together with all accrued dividends and interests, lawfully vest with the respective members of the association, whether or not their whereabouts are known, and considering that a trust has been created governing these properties, they cannot be reclassified and appropriated by the association as "income" thereof. The association should exhaust all available means of locating the whereabouts of former CESLA members, and if the search proves to be futile, nevertheless, it has the fiduciary duty to hold said amount as trustee for the legal owner thereof, unless otherwise escheated in accordance with law. Very truly yours, (SGD.) JULIO A. SULIT, JR. Chairman * Copied verbatim from documents obtained directly from the Securities and Exchange Commission.