J.A.B. Bulao & Associates

CASE C012-0004: METROPOLITAN BANK & TRUST CO. (METROBANK), REPRESENTED BY ROSELLA A. SANTIAGO VS. ANTONINO O. TOBIAS III (G.R. NO. 177780, JANUARY 25, 2012) SUBJECT: COURT CANT REVERSE DOJ EXCEPT IF THERE IS GRAVE ABUSE OF DISCRETION; THE PRESUMPTION THAT THE HOLDER OF A FALSIFIED DOCUMENT IS THE FALSIFIER HOLDS TRUE ONLY IN THE ABSENCE OF SATISFACTORY EXPLANATION (BRIEF TITLE: METROBANK VS. TOBIAS)

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DISPOSITIVE:

WHEREFORE, the Court DENIES the petition for review on certiorari, and AFFIRMS the decision of the Court of Appeals promulgated on December 29, 2006. The petitioner shall pay the costs of suit.

SO ORDERED.

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Republic of thePhilippines

Supreme Court

Manila

FIRST DIVISION

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D E C I S I O N

BERSAMIN, J.:

This appeal assails the adverse decision of the Court of Appeals (CA)¹ that dismissed the petition for certiorari brought by the petitioner to nullify and set aside the resolutions issued by the Secretary of Justice on July 20, 2004² and November 18, 2005³ directing the City Prosecutor of Malabon City to withdraw the information in Criminal Case No. 27020 entitled People v. Antonino O. Tobias III.

We affirm the CA in keeping with the principle of non-interference with the prerogative of the Secretary of Justice to review the resolutions of the public prosecutor in the latter’s determination of the existence of probable cause, absent any showing that the Secretary of Justice thereby commits grave abuse of his discretion.

Antecedents

In 1997, Rosella A. Santiago, then the OIC-Branch Head of Metropolitan Bank & Trust Company (METROBANK) in Valero Street, MakatiCity, was introduced to respondent Antonino O. Tobias III (Tobias) by one Jose Eduardo Gonzales, a valued client of METROBANK. Subsequently, Tobias opened a savings/current account for and in the name of Adam Merchandising, his frozen meat business. Six months later, Tobias applied for a loan from METROBANK, which in due course conducted trade and credit verification of Tobias that resulted in negative findings. METROBANK next proceeded to appraise the property Tobias offered as collateral by asking him for a photocopy of the title and other related documents.⁴ The property consisted of four parcels of land located in Malabon City, Metro Manila with a total area of 6,080 square meters and covered by Transfer Certificate of Title (TCT) No. M-16751.⁵ Based on the financial statements submitted by Tobias, METROBANK approved a credit line for P40,000,000.00. On August 15, 1997, Joselito Bermeo Moreno, Lead Internal Affairs Investigator of METROBANK, proceeded to the Registry of Deeds of Malabon to cause the annotation of the deed of real estate mortgage on TCT No. M-16751. The annotation was Entry No. 26897.⁶

Thereafter, Tobias initially availed himself of P20,000,000, but took out the balance within six months.⁷ He paid the interest on the loan for about a year before defaulting. His loan was restructured to 5-years upon his request. Yet, after two months, he again defaulted. Thus, the mortgage was foreclosed, and the property was sold to METROBANK as the lone bidder.⁸ On June 11, 1999, the certificate of sale was issued in favor of METROBANK.⁹

When the certificate of sale was presented for registration to the Registry of Deeds of Malabon, no corresponding original copy of TCT No. M-16751 was found in the registry vault. Atty. Sarah Principe-Bido, Deputy Register of Deeds of Malabon, went on to verify TCT No. M-16751 and learned that Serial No. 4348590 appearing therein had been issued for TCT No. M-15363 in the name of one Alberto Cruz; while TCT No. 16751 (now TCT No. 390146) appeared to have been issued in the name of Eugenio S. Cruz and Co. for a parcel of land located in Navotas.¹⁰

Given such findings, METROBANK requested the Presidential Anti-Organized Crime Task Force (PAOCTF) to investigate.¹¹ In its report dated May 29, 2000,¹² PAOCTF concluded that TCT No. M-16751 and the tax declarations submitted by Tobias were fictitious. PAOCTF recommended the filing against Tobias of a criminal complaint for estafa through falsification of public documents under paragraph 2 (a) of Article 315, in relation to Articles 172(1) and 171(7) of the Revised Penal Code.¹³

The Office of the City Prosecutor of Malabon ultimately charged Tobias with estafa through falsification of public documents through the following information,¹⁴ viz:

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That on or about the 15^th day of August, 1997 in the Municipality of Malabon, Philippines and within the jurisdiction of this Honorable Court, the above-named accused, by means of deceit, false pretense, fraudulent acts and misrepresentation executed prior to or simultaneous with the commission of fraud, represented to METROBANK, as represented by MS. ROSELLA S. SANTIAGO, that he is the registered owner of a parcel of land covered by TCT No. M-16751 which he represented to be true and genuine when he knew the Certificate of Title No. M-16751 is fake and spurious and executed a Real Estate Mortgage in favor of Metrobank and offered the same as collateral for a loan and Rosella S. Santiago relying on said misrepresentation gave to accused, the amount of P20,000,000.00 and once in possession of the amount, with intent to defraud, willfully, unlawfully and feloniously failed to deliver the land covered by spurious title and misappropriate, misapply and converted the said amount of P20,000,000.00 to his own personal use and benefit and despite repeated demands accused failed and refused and still fails and refuses to return the amount to complainant METROBANK, and/or delivered the land covered in the spurious title in the aforementioned amount of P20,000,000.00.

CONTRARY TO LAW.¹⁵

Tobias filed a motion for re-investigation,¹⁶ which was granted.

In his counter-affidavit submitted during the re-investigation,¹⁷ Tobias averred that he had bought the property from one Leonardo Fajardo through real estate brokers Augusto Munsuyac and Carmelito Pilapil; that Natalio Bartolome, his financial consultant from Carwin International, had convinced him to purchase the property due to its being an ideal site for his meat processing plant and cold storage business; that the actual inspection of the property as well as the verification made in the Registry of Deeds of Malabon City had ascertained the veracity of TCT No. 106083 under the name of Leonardo Fajardo; that he had applied for the loan from METROBANK to pay the purchase price by offering the property as collateral; that in order for the final application to be processed and the loan proceeds to be released, METROBANK had advised him to have the title first transferred to his name; that he had executed a deed of absolute sale with Fajardo covering the property, and that said instrument had been properly registered in the Registry of Deeds; that the transfer of the title, being under the account of the seller, had been processed by seller Fajardo and his brokers Munsuyac and Pilapil; that his title and the property had been inspected and verified by METROBANK’s personnel; and that he did not have any intention to defraud METROBANK.

Nonetheless, on December 27, 2002, the City Prosecutor of Malabon still found probable cause against Tobias, and recommended his being charged with estafa through falsification of public document.¹⁸

Tobias appealed to the Department of Justice (DOJ).

On July 20, 2004, then Acting Secretary of Justice Ma. Merceditas N. Gutierrez issued a resolution directing the withdrawal of the information filed against Tobias,¹⁹ to wit:

WHEREFORE, the assailed resolution is hereby REVERSED and SET ASIDE. The City Prosecutor of Malabon City is directed to cause the withdrawal of the Information in Crim. Case No. 27020 against respondent Antonino O. Tobias III, and report the action taken thereon within ten (10) days from receipt hereof.

SO ORDERED.

Acting Secretary of Justice Gutierrez opined that Tobias had sufficiently established his good faith in purchasing the property; that he had even used part of the proceeds of the loan to pay the seller; that it was METROBANK that had caused the annotation of the mortgage on the TCT, thereby creating an impression that the title had been existing in the Registry of Deeds at that time; that, accordingly, the presumption that the possessor of a falsified document was the author of the falsification did not apply because it was always subject to the qualification or reference as to the approximate time of the commission of the falsification.

METROBANK moved to reconsider,²⁰ arguing that Tobias had employed deceit or false pretense in offering the property as collateral by using a fake title; and that the presumption that the possessor of the document was the author of the falsification applied because no other person could have falsified the TCT and would have benefitted therefrom except Tobias himself.

On November 18, 2005, Secretary of Justice Raul M. Gonzalez denied METROBANK’s motion for reconsideration.²¹

Ruling of the CA

METROBANK challenged the adverse resolutions through certiorari.

On December 29, 2006, the CA promulgated its decision,²² dismissing METROBANK’s petition for certiorari by holding that the presumption of authorship might be disputed through a satisfactory explanation, viz:

We are not unaware of the established presumption and rule that when it is proved that a person has in his possession a falsified document and makes use of the same, the presumption or inference is that such person is the forger (Serrano vs. Court of Appeals, 404 SCRA 639, 651 [2003]), citing Koh Tieck Heng vs. People, 192 SCRA 533, 546-547 [1990]). Yet, the Supreme Court declared that in the absence of satisfactory explanation, one who is found in possession of a forged document and who used it is presumed to be the forger (citing People vs. Sendaydiego, 81 SCRA 120, 141 [1978]). Very clearly then, a satisfactory explanation could render ineffective the presumption which, after all, is merely a disputable one.

It is in this score that We affirm the resolution of the Department of Justice finding no probable cause against private respondent Tobias for estafa thru falsification of public document. The record speaks well of Tobias’ good faith and lack of criminal intention and liability. Consider:

(a) Tobias has in his favor a similar presumption that good faith is always presumed. Therefore, he who claims bad faith must prove it (Prinsipio vs. The Honorable Oscar Barrientos, G.R. 167025, December 19, 2005). No such evidence of bad faith of Tobias appears on record;

(b) Tobias’ actuation in securing the loan belies any criminal intent on his part to deceive petitioner Bank. He was not in a hurry to obtain the loan. He had to undergo the usual process of the investigative arm or machine of the Bank not only on the location and the physical appearance of the property but likewise the veracity of its title. Out of the approved P40,000,000.00 loan he only availed of P20,000,000.00, for his frozen meat business which upon investigation of the Bank failed to give negative results;

(c) Tobias paid the necessary interests for one (1) year on the loan and two (2) installments on the restructured loan; and

(d) More importantly, the loan was not released to him until after the mortgage was duly registered with the Registry of Deeds of Malabon City and even paid the amount of P90,000.00 for the registration fees therefor.

These actuations, for sure, can only foretell that Tobias has the least intention to deceive the Bank in obtaining the loan. It may not be surprising to find that Tobias could even be a victim himself by another person in purchasing the properties he offered as security for the loan.²³

The CA stressed that the determination of probable cause was an executive function within the discretion of the public prosecutor and, ultimately, of the Secretary of Justice, and the courts of law could not interfere with such determination;²⁴ that the private complainant in a criminal action was only concerned with its civil aspect; that should the State choose not to file the criminal action, the private complainant might initiate a civil action based on Article 35 of the Civil Code, to wit:

In the eventuality that the Secretary of Justice refuses to file the criminal complaint, the complainant, whose only interest is the civil aspect of the case and not the criminal aspect thereof, is not left without a remedy. In Vda. De Jacob vs. Puno, 131 SCRA 144, 149 [1984], the Supreme Court has this for an answer:

“The remedy of complainant in a case where the Minister of Justice would not allow the filing of a criminal complaint against an accused because it is his opinion that the evidence is not sufficient to sustain an information for the complaint with which the respondents are charged of, is to file a civil action as indicated in Article 35 of the Civil Code, which provides:

‘Art. 35. When a person, claiming to be injured by a criminal offense, charges another with the same, for which no independent civil action is granted in this Code or any special law, but the justice of the peace finds no reasonable grounds to believe that a crime has been committed, or the prosecuting attorney refuses or fails to institute criminal proceedings, the complainant may bring a civil action for damages against the alleged offender. Such civil action may be supported by a preponderance of evidence. Upon the defendant’s motion, the court may require the plaintiff to file a bond to indemnify the defendant in case the complainant should be found to be malicious.

‘If during the pendency of the civil action, an information should be presented by the prosecuting attorney, the civil action shall be suspended until the termination of the criminal proceedings.’”²⁵

METROBANK sought reconsideration, but the CA denied its motion for that purpose, emphasizing that the presumption that METROBANK firmly relied upon was overcome by Tobias sufficiently establishing his good faith and lack of criminal intent. The CA relevantly held:

Petitioner should be minded that the subject presumption that the possessor and user of a forged or falsified document is presumed to be the falsifier or forger is a mere disputable presumption and not a conclusive one. Under the law on evidence, presumptions are divided into two (2) classes: conclusive and rebuttable. Conclusive or absolute presumptions are rules determining the quantity of evidence requisite for the support of any particular averment which is not permitted to be overcome by any proof that the fact is otherwise, if the basis facts are established (1 Greenleaf, Ev 44; 29 Am Jur 2d, Evidence 164; 1 Jones on Evidence 6 ed, page 132). Upon the other hand, a disputable presumption has been defined as species of evidence that may be accepted and acted on when there is no other evidence to uphold the contention for which it stands, or one which may be overcome by other evidence (31A C.J.S., p. 197; People v. de Guzman, G.R. No. 106025, Feb. 9, 1994; Herrera, Remedial Law, Vol. VI, 1999 Edition, pp. 40-41). In fact, Section 3 of Rule 131 provides that the disputable presumptions therein enumerated are satisfactory if uncontradicted but may be contradicted and overcome by other evidence. Thus, as declared in Our decision in this case, private respondent had shown evidence of good faith and lack of criminal intention and liability that can overthrow the controversial disputable presumption.²⁶

Issue

In this appeal, METROBANK raises the lone issue of—

WHETHER OR NOT THE HONORABLE COURT OF APPEALS HAS DECIDED A QUESTION OF SUBSTANCE PROBABLY NOT IN ACCORD WITH LAW OR WITH THE APPLICABLE DECISIONS OF THIS HONORABLE COURT AND THUS, COMMITTED PATENT ERROR IN RENDERING THE ASSAILED DECISION DATED 29 DECEMBER 2006, DISMISSING METROBANK’S PETITION FOR CERTIORARI AND AFFIRMING THE RESOLUTIONS DATED 20 JULY 2004 AND 18 NOVEMBER 2005 OF THE HON. SECRETARY OF JUDTICE AND IN DENYING METROBANK’S MOTION FOR RECONSIDERATION.

METROBANK submits that the presumption of authorship was sufficient to establish probable cause to hold Tobias for trial; that the presumption applies when a person is found in possession of the forged instrument, makes use of it, and benefits from it; that contrary to the ruling of the CA, there is no requirement that the legal presumption shall only apply in the absence of a valid explanation from the person found to have possessed, used and benefited from the forged document; that the CA erred in declaring that Tobias was in good faith, because good faith was merely evidentiary and best raised in the trial on the merits; and that Tobias was heavily involved in a modus operandi of using fake titles because he was also being tried for a similar crime in the RTC, Branch 133, in Makati City.

METROBANK maintains that what the Secretary of Justice did was to determine the innocence of the accused, which should not be done during the preliminary investigation; and that the CA disregarded such lapse.

On the other hand, Tobias posits that the core function of the Department of Justice is to prosecute the guilty in criminal cases, not to persecute; that although the prosecutors are given latitude to determine the existence of probable cause, the review power of the Secretary of Justice prevents overzealous prosecutors from persecuting the innocent; that in reversing the resolution of Malabon City Assistant Prosecutor Ojer Pacis, the Secretary of Justice only acted within his authority; that, indeed, the Secretary of Justice was correct in finding that there was lack of evidence to prove that the purported fake title was the very cause that had induced the petitioner to grant the loan; and that the Secretary likewise appropriately found that Tobias dealt with the petitioner in good faith because of lack of proof that he had employed fraud and deceit in securing the loan.

Lastly, Tobias argues that the presumption of forgery could not be applied in his case because it was METROBANK, through a representative, who had annotated the real estate mortgage with the Registry of Deeds; and that he had no access to and contact with the Registry of Deeds, and whatever went wrong after the annotation was beyond his control.

Ruling

The appeal has no merit.

Under the doctrine of separation of powers, the courts have no right to directly decide matters over which full discretionary authority has been delegated to the Executive Branch of the Government,²⁷ or to substitute their own judgments for that of the Executive Branch,²⁸ represented in this case by the Department of Justice. The settled policy is that the courts will not interfere with the executive determination of probable cause for the purpose of filing an information, in the absence of grave abuse of discretion.²⁹ That abuse of discretion must be so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law or to act at all in contemplation of law, such as where the power is exercised in an arbitrary and despotic manner by reason of passion or hostility.³⁰ For instance, in Balanganan v. Court of Appeals, Special Nineteenth Division, Cebu City,³¹ the Court ruled that the Secretary of Justice exceeded his jurisdiction when he required “hard facts and solid evidence” in order to hold the defendant liable for criminal prosecution when such requirement should have been left to the court after the conduct of a trial.

In this regard, we stress that a preliminary investigation for the purpose of determining the existence of probable cause is not part of a trial.³² At a preliminary investigation, the investigating prosecutor or the Secretary of Justice only determines whether the act or omission complained of constitutes the offense charged.³³ Probable cause refers to facts and circumstances that engender a well-founded belief that a crime has been committed and that the respondent is probably guilty thereof.³⁴ There is no definitive standard by which probable cause is determined except to consider the attendant conditions; the existence of probable cause depends upon the finding of the public prosecutor conducting the examination, who is called upon not to disregard the facts presented, and to ensure that his finding should not run counter to the clear dictates of reason.³⁵

Tobias was charged with estafa through falsification of public document the elements of which are: (a) the accused uses a fictitious name, or falsely pretends to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions, or employs other similar deceits; (b) such false pretense, fraudulent act or fraudulent means must be made or executed prior to or simultaneously with the commission of the fraud; (c) the offended party must have relied on the false pretense, fraudulent act or fraudulent means, that is, he was induced to part with his money or property because of the false pretense, fraudulent act or fraudulent means; and (d) as a result thereof, the offended party suffered damage.³⁶ It is required that the false statement or fraudulent representation constitutes the very cause or the only motive that induced the complainant to part with the thing.³⁷

METROBANK urges the application of the presumption of authorship against Tobias based on his having offered the duplicate copy of the spurious title to secure the loan; and posits that there is no requirement that the presumption shall apply only when there is absence of a valid explanation from the person found to have possessed, used and benefited from the forged document.

We cannot sustain METROBANK’s urging.

Firstly, a presumption affects the burden of proof that is normally lodged in the State.³⁸ The effect is to create the need of presenting evidence to overcome the prima facie case that shall prevail in the absence of proof to the contrary.³⁹ As such, a presumption of law is material during the actual trial of the criminal case where in the establishment thereof the party against whom the inference is made should adduce evidence to rebut the presumption and demolish the prima facie case.⁴⁰ This is not so in a preliminary investigation, where the investigating prosecutor only determines the existence of a prima facie case that warrants the prosecution of a criminal case in court.⁴¹

Secondly, the presumption of authorship, being disputable, may be accepted and acted upon where no evidence upholds the contention for which it stands.⁴² It is not correct to say, consequently, that the investigating prosecutor will try to determine the existence of the presumption during preliminary investigation, and then to disregard the evidence offered by the respondent. The fact that the finding of probable cause during a preliminary investigation is an executive function does not excuse the investigating prosecutor or the Secretary of Justice from discharging the duty to weigh the evidence submitted by the parties. Towards that end, the investigating prosecutor, and, ultimately, the Secretary of Justice have ample discretion to determine the existence of probable cause,⁴³ a discretion that must be used to file only a criminal charge that the evidence and inferences can properly warrant.

The presumption that whoever possesses or uses a spurious document is its forger applies only in the absence of a satisfactory explanation.⁴⁴ Accordingly, we cannot hold that the Secretary of Justice erred in dismissing the information in the face of the controverting explanation by Tobias showing how he came to possess the spurious document. Much less can we consider the dismissal as done with abuse of discretion, least of all grave. We concur with the erudite exposition of the CA on the matter, to wit:

It would seem that under the above proposition of the petitioner, the moment a person has in his possession a falsified document and has made use of it, probable cause or prima facie is already established and that no amount of satisfactory explanation will prevent the filing of the case in court by the investigating officer, for any such good explanation or defense can only be threshed out in the trial on the merit. We are not to be persuaded. To give meaning to such argumentation will surely defeat the very purpose for which preliminary investigation is required in this jurisdiction.

A preliminary investigation is designed to secure the respondent involved against hasty, malicious and oppressive prosecution. A preliminary investigation is an inquiry to determine whether (a) a crime has been committed, and (b) whether there is probable cause to believe that the accused is guilty thereof (De Ocampo vs. Secretary of Justice, 480 SCRA 71 [2006]). It is a means of discovering the person or persons who may be reasonably charged with a crime (Preferred Home Specialties, Inc. vs. Court of Appeals, 478 SCRA 387, 410 [2005]). Prescindingly, under Section 3 of Rule 112 of the Rules of Criminal Procedure, the respondent must be informed of the accusation against him and shall have the right to examine the evidence against him and submit his counter-affidavit to disprove criminal liability. By far, respondent in a criminal preliminary investigation is legally entitled to explain his side of the accusation.

We are not unaware of the established presumption and rule that when it is proved that a person has in his possession a falsified document and makes use of the same the presumption or inference is that such person is the forger (Serrano vs. Court of Appeals, 404 SCRA 639, 651 [2003]), citing Koh Tieck Heng vs. People, 192 SCRA 533, 546-547 [1990]). Yet, the Supreme Court declared that in the absence of satisfactory explanation, one who is found in possession of a forged document and who used it is presumed to be the forger (citing People vs. Sendaydiego, 81 SCRA 120, 141 [1978]). Very clearly then, a satisfactory explanation could render ineffective the presumption which, after all, is merely a disputable one.⁴⁵

We do not lose sight of the fact that METROBANK, a commercial bank dealing in real property, had the duty to observe due diligence to ascertain the existence and condition of the realty as well as the validity and integrity of the documents bearing on the realty.⁴⁶ Its duty included the responsibility of dispatching its competent and experience representatives to the realty to assess its actual location and condition, and of investigating who was its real owner.⁴⁷ Yet, it is evident that METROBANK did not diligently perform a thorough check on Tobias and the circumstances surrounding the realty he had offered as collateral. As such, it had no one to blame but itself. Verily, banks are expected to exercise greater care and prudence than others in their dealings because their business is impressed with public interest.⁴⁸ Their failure to do so constitutes negligence on its part.⁴⁹ 

WHEREFORE, the Court DENIES the petition for review on certiorari, and AFFIRMS the decision of the Court of Appeals promulgated on December 29, 2006. The petitioner shall pay the costs of suit.

SO ORDERED.

LUCAS P. BERSAMIN

Associate Justice

WE CONCUR:

RENATO C. CORONA

Chief Justice

Chairperson

TERESITA J. LEONARDO-DE CASTRO MARTIN S. VILLARAMA, JR.

Associate Justice Associate Justice

ESTELA M. PERLAS-BERNABE

Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

RENATO C. CORONA

Chief Justice

* Vice Associate Justice Mariano C. Del Castillo, who took part in the proceedings in the Court of Appeals, per raffle of October 19, 2011.

1 Rollo, pp. 40-51; penned by Associate Justice Conrado M. Vasquez, Jr. (later Presiding Justice, but retired), with Associate Justice Mariano C. Del Castillo (now a Member of the Court) and Associate Justice Ricardo R.Rosario concurring.

2 Id., pp. 54-57.

3Id., p. 58.

4 Id., p. 79.

5 Id., p. 61-64.

6 Id., p. 71.

7 Id., p. 80.

8 Id., p. 80.

9 Id., pp. 65-67.

10 Id., pp. 72-73.

11 Id., pp. 79-81.

12 Id., pp. 68-78.

13 Id., p. 76.

14 Id., pp. 85-86.

15 Id., p. 85.

16 Id., pp. 87-88.

17 Id., pp. 89-93.

18 Id., p. 60.

19 Id., pp. 54-57.

20 Id., pp. 106-125.

21 Id., p. 58.

22Id., pp. 40-51.

23 Id., pp. 45-47.

24 Id., pp. 47-49.

25 Id., pp. 50-51.

26 Id., p. 53.

27 Public Utilities Department, Olongapo City v. Guingona, Jr., G.R. No. 130399, September 20, 2001, 365 SCRA 467, 474.

28 Alcaraz v. Gonzalez, G.R. No. 164715, September 20, 2006, 502 SCRA 518, 529.

29 Reyes v. Pearlbank Securities, Inc., G.R. No. 171435, July 30, 2008, 560 SCRA 518, 535; Insular Life Assurance Company, Limited v. Serrano, G.R. No. 163255, June 22, 2007, 525 SCRA 400, 410.

30 Galario v. Office of the Ombudsman (Mindanao), G.R. No. 166797, July 10, 2007, 527 SCRA 190, 204, 205; First Women’s Credit Corporation v. Perez, G.R. No. 169026, June 15, 2006, 490 SCRA 774, 777-778.

31 G.R. No. 174350, August 13, 2008, 562 SCRA 184.

32 Metropolitan Bank and Trust Company v. Reynado, G.R. No. 164538, August 9, 2010, 627 SCRA 88.

33 Id., p. 103; also, Villanueva v. Secretary of Justice, G.R. No. 162187, November 18, 2005, 475 SCRA 495, 511.

34 Osorio v. Desierto, G.R. No. 156652, October 13, 2005, 472 SCRA 559, 573; Filadams Pharma, Inc. v. Court of Appeals, G.R. No. 132422, March 30, 2004, 426 SCRA 460, 470.

35 Lastrilla v. Granda, G.R. No. 160257, January 31, 2006, 481 SCRA 324, 347.

36 Ambito v. People, G.R. No. 127327, February 13, 2009, 579 SCRA 69, 97; Flores v. Layosa, G.R. No. 154714, August 12, 2004, 436 SCRA 337, 347.

37 Reyes, The Revised Penal Code, Book II (2006), p. 773.

38 Wa-acon v. People, G.R. No. 164575, December 6, 2006, 510 SCRA 429, 438.

39 Lastrilla v. Granda, G.R. No. 160257, January 31, 2006, 481 SCRA 324, 342-342; Salonga v. Paño, G.R. No. 59524, February 18, 1985, 134 SCRA 438, 450.

40 Wa-acon v. People, supra, note 38.

41 Alonzo v. Concepcion, A.M. No. RTJ-04-1879, January 17, 2005, 448 SCRA 329, 337.

42 Sevilla v. Cardenas, G.R. No. 167684, July 31, 2006, 497 SCRA 428, 442-443; citing People v. De Guzman, G.R. No. 106025, February 9, 1994, 229 SCRA 795, 798-799.

43United Coconut Planters Bank v. Looyuko, G.R. No. 156337, September 28, 2007; First Women’s Credit Corporation v. Perez, G.R. No. 169026, June 15, 2006, 490 SCRA 774, 777.

44 Lastrilla v. Granda, G.R. No. 160257, January 31, 2006, 481 SCRA 324, 342; People v. Enfermo, G.R. Nos. 148682-85, November 30, 2005, 476 SCRA 515, 532.

45 Rollo, pp. 44-45.

46 Cruz v. Bancom, G.R. No. 147788, March 19, 2002, 379 SCRA 490, 505.

47 Rural Bank of Siaton (Negros Oriental), Inc. v. Macajilos, G.R. No. 152483, July 14, 2006, 495 SCRA 127; Rural Bank of Sta. Ignacia, Inc. v. Dimatulac, G.R. No. 142015, April 29, 2003, 401 SCRA 742.

48 Cavite Development Bank v. Sps. Lim, G.R. No. 131679, February 1, 2000, 324 SCRA 346, 359; Rural Bank of Siaton (Negros Oriental), Inc. v. Macajilos, G.R. No. 152483, July 14, 2006, 495 SCRA 127, 140.

49 Rural Bank of Sta. Ignacia, Inc. v. Dimatulac, supra, note 47, at p. 752.

CASE 2012-0003: MARINO B. ICDANG VS. SANDIGANBAYAN (SECOND DIVISION) AND PEOPLE OF THE PHILIPPINES. (G.R. NO. 185960, 25 JANUARY 2012, VILLARAMA, JR., J.) SUBJECT/S: DECISION OF CONVICTION BY  SANDIGANBAYAN MUST BE APPEALED UNDER RULE 45 NOT RULE 65; ABSENCE OF COUNSEL DURING PROMULGATION DOES NOT INVALIDATE DECISION. (BRIEF TITLE: ICDANG VS. SANDIGANBAYAN).

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DISPOSITIVE:

WHEREFORE, the petition is DISMISSED. The Decision promulgated on May 26, 2008 and Resolution issued on November 18, 2008 by the Sandiganbayan in Criminal Case No. 26327 are AFFIRMED.

With costs against the petitioner.

SO ORDERED.

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FIRST DIVISION

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DECISION

VILLARAMA, JR., J.:

Before us is a petition for certiorari under Rule 65 seeking to reverse and set aside the Decision¹ dated May 26, 2008 and Resolution² dated November 18, 2008 of the Sandiganbayan (SB) (Second Division) which convicted petitioner of the crime of malversation of public funds.

The factual antecedents:

Petitioner Marino B. Icdang, at the time of the transactions subject of this controversy, was the Regional Director of the Office for Southern Cultural Communities (OSCC) Region XII inCotabatoCity.

On January 19, 1998, a Special Audit Team was formed by the Commission on Audit (COA) Regional Office XII, Cotabato City pursuant to COA Regional Office Order No. 98-10³ to conduct comprehensive audit on the 1996 funds for livelihood projects of the OSCC-Region XII. Hadji Rashid A. Mudag was designated as team leader, with Jose Mercado, Myrla Fermin and Evelyn Macala as members.

In its report submitted to the COA Regional Director, the audit team noted that petitioner was granted cash advances which remained unliquidated. In the cash examination conducted by the team on March 10, 1998, it was discovered that petitioner had a shortage of P219,392.75. Out of the total amount of P920,933.00 released in September 1996 to their office under sub-allotment advice No. COT-043, to cover the implementation of various socio-economic projects for the cultural communities of the region, cash advances amounting to P407,000.00 were granted from October 1, 1996 to February 5, 1997 to officials and employees including petitioner. Per records, it was noted that P297,392.75 of these cash advances remained unliquidated as of December 31, 1997.⁴

Petitioner never denied that he received a total of P196,000.00 evidenced by disbursement vouchers and checks payable to him, as follows:

In addition, per the Schedule of Cash Advance Intended for Livelihood Projects,⁶ the following amounts were also for petitioner’s account:

In the Audit Observation Memorandum No. 97-001 (March 18, 1998) sent by the COA Region XII to the OSCC-Region XII reflecting the findings of the Special Audit Team, it was also disclosed that: (1) Funds intended for programs for Ancestral Domain Claim Development and to support tribal cooperatives, were cash advanced, but the proposed projects were not implemented by the OSCC-Region XII; (2) No official cashbooks are maintained to record cash advances and disbursements from the 1996 funds allocated for livelihood projects; and (3) Out of the total P920,933.00 allocated for 1996 livelihood projects, the amount of P445,892.80 was disbursed leaving a balance of P475,040.20; however, final trial balance as of December 31, 1996 showed that the office has exhausted the allocated funds for the whole year; the utilization of the P475,040.20 could not be explained by the Accountant so that it may be concluded that such was misappropriated. Petitioner indicated his comments on the said memorandum by requesting for extension to restitute the amount of P306,412.75 (which included the P67,000.00 cash shortage of another OSCC-Region XII official, Ma. Teresa A. Somorostro), and explaining that the P475,040.20 was not misappropriated as evidenced by their own financial report and re-statement of allotment and obligation for the month ending December 31, 1996.⁷

From the field interviews conducted by the audit team, it was also gathered that the intended projects covered by the cash advances were never implemented, such as the proposed Children Development Project in Bgy. Matila; adult literacy program in Cotabato; operationalization of tribal cooperative in Bgy. Bantagan, Sultan Kudarat; and establishment of ICC-IAD in Magpet, Cotabato where a complaint was made to the effect that the OSCC-Region XII office allegedly upon receipt of funds prepares a project for implementation which is different from that project proposal submitted by the project officer. Supposedly, there was likewise no support or assistance given by the OSCC-Region XII to the activities of the Provincial Special Task Force on Ancestral Domain for the indigenous people of Columbio, Sultan Kudarat, and to Bgys. Salumping, Municipalityof Esperanza, President Roxas, and Matrilala.⁸ And as already mentioned, the audit team discovered that the accountable officers of OSCC-Region XII failed to maintain the official cashbook so that there were no recording of transactions whenever a cash advance was granted; only subsidiary ledgers were used by the accounting section.

From the P232,000.00 accountabilities of petitioner, the COA deducted the following: P10,000.00 covered by acknowledgment receipt by A. Anas; various cash invoices in the amount of P2,197.25; and Reimbursement Expense Receipts (RERs) in the amount of P410.00. After the cash examination, petitioner was still found short of P219,392.75.⁹ Consequently, a demand letter was sent by the COA for petitioner to immediately produce the missing funds. In his letter-reply dated March 19, 1998, petitioner requested for one-week extension to comply with the directive.¹⁰

However, the one-week period lapsed without compliance having been made by petitioner. Hence, the audit team recommended the initiation of administrative and criminal charges against him, as well as Ms. Somorostro, Chief of the Socio-Cultural Development Concerns Division of OSCC-Region XII.

On September 21, 2000, the Office of the Ombudsman found probable cause against petitioner and Ms. Somorostro for violation of Art. 217 of the Revised Penal Code, as amended, and Section 3(e) of Republic Act No. 3019 (Anti-Graft and Corrupt Practices Act).

The Amended Information charging petitioner with the crime of Malversation of Public Funds (Criminal Case No. 26327) reads:

That during the period from October 1996 to February 1997 in Cotabato City, Philippines and within the jurisdiction of this Honorable Court, accused Marino B. Icdang, a public officer being then the Regional Director of the Office for Southern Communities (OSCC), Region XII, Cotabato City and as such is accountable officer for the public fund received by him that were intended for the socio-economic and cultural development projects of the OSCC Region XII, did then and there willfully, unlawfully and feloniously take[,] misappropriate, embezzle and convert for his own personal use and benefit from the said fund the aggregate amount of TWO HUNDRED NINETEEN THOUSAND THREE HUNDRED NINETY-TWO PESOS AND 75/100 (P219,392.75) to the damage and prejudice of the government in the aforesaid sum.

CONTRARY TO LAW.¹¹

Petitioner was likewise charged with violation of Section 3(e) of R.A. No. 3019 (Criminal Case No. 26328).

The lone witness for the prosecution was Hadji Rashid A. Mudag, State Auditor IV of COA Region XII. He presented vouchers which they were able to gather during the cash examination conducted on March 10, 1998, which showed cash advances granted to petitioner, and in addition other cash advances also received by petitioner for which he remained accountable, duly certified by the Accountant of OSCC-Region XII. Petitioner was notified of the cash shortage through the Audit Observation Memorandum No. 97-001 dated March 18, 1998 and was sent a demand letter after failing to account for the missing funds totalling P219,392.75.¹²

On cross-examination, witness Mudag admitted that while they secured written and signed certifications from project officers and other individuals during the field interviews, these were not made under oath. The reports from Sultan Kudarat were just submitted to him by his team members as he was not present during the actual interviews; he had gone only to Kidapawan, Cotabato and only prepared the audit report. He also admitted that they no longer visited the project sites after being told by the project officers that there was nothing to be inspected because no project was implemented.¹³

On May 26, 2008, the SB’s Second Division rendered its decision convicting petitioner of malversation and acquitting him from violation of Section 3(e) of R.A. No. 3019. The dispositive portion reads:

WHEREFORE, premises considered judgment is hereby rendered finding accused MARINO B. ICDANG Guilty beyond reasonable doubt of Malversation of Public Funds or Property in Criminal Case No. 26327 and finding in his favor the mitigating circumstance of voluntary surrender, is hereby sentenced to an indeterminate penalty of, considering the amount involved, TEN (10) YEARS and ONE (1) DAY of PRISION MAYOR as minimum to EIGHTEEN (18) YEARS, EIGHT (8) MONTHS and ONE (1) DAY of Reclusion Temporal as maximum, to suffer the penalty of perpetual special disqualification, and to pay a fine of P196,000.00 without subsidiary imprisonment in case of insolvency.

He is also ordered to reimburse the government of the said amount.

In Criminal Case No. 26328, he is hereby ACQUITTED on the basis of reasonable doubt.

With cost against accused.

SO ORDERED.¹⁴

The SB ruled that the prosecution has established the guilt of petitioner beyond reasonable doubt for the crime of malversation of public funds, the presumption from his failure to account for the cash shortage in the amount of P232,000.00 remains unrebutted. As to the reasons given by petitioner for non-compliance with the COA demand, the SB held:

A careful perusal of Mr. Icdang’s Letter-Answer dated 19 March 1998 (Exh. “J”) to the demand letter and directive issued by the COA clearly shows he was just asking for extension of time to comply with the demand letter. There was virtually no denial on his part that he received the P232,000.00 amount earmarked for the various government projects. His reasons were first, the committee tasked to prepare the liquidation of the cash advances are still in the process of collecting all the documents pertinent to the disbursement of the project funds; and second, the payees to the disbursements were still to be notified so that they will have to come to the office to affix their signatures as payees to the liquidation vouchers.

This response is queer because as he gave the money to the supposed payees, he should have kept a ledger to keep track of the same, considering that these are public funds. More importantly, Mr. Icdang was given ample opportunity to dispute the COA findings that there was indeed a shortage. Instead of doing so, Mr. Icdang never presented the promised proof of his innocence before this Court during the trial of this case. Thus, the prima facie presumption under Article 217 of the Revised Penal Code, that the failure of a public officer to have duly forthcoming the public funds with which he is chargeable, upon demand, shall be evidence that he put the missing funds for personal uses, arises because first, there was no issue as to the accuracy, correctness and regularity of the audit findings and second, the funds are missing.¹⁵

Petitioner filed a motion for reconsideration requesting that he be given another chance to present his evidence, stating that his inability to attend the trial were due to financial constraints such that even when some of the scheduled hearings were sometimes held in Davao City and Cebu City, he still failed to attend the same. However, the SB denied the motion noting that the decision has become final and executory on June 10, 2008 for failure of petitioner to file a motion for reconsideration, or new trial, or appeal before that date.

Hence, this petition anchored on the following grounds:

I. THE HONORABLE SANDIGANBAYAN COMMITTED GRAVE ABUSE OF DISCRETION TANTAMOUNT TO LACK OR EXCESS OF JURISDICTION WHEN IT RENDERED ITS JUDGMENT OF CONVICTION AGAINST PETITIONER DESPITE ITS KNOWLEDGE THAT PETITIONER WAS NOT ABLE TO ADDUCE HIS EVIDENCE DUE TO VARIOUS CIRCUMSTANCES, THAT HE WAS NOT ASSISTED BY COUNSEL DURING THE PROMULGATION OF JUDGMENT; THE GROSS AND RECKLESS NEGLIGENCE OF HIS FORMER COUNSEL IN FAILING TO ASSIST HIM DURING THE PROMULGATION; HIS FINANCIAL AND ECONOMIC DISLOCATION WHICH MADE HIM UNABLE TO ATTEND THE SCHEDULED TRIALS IN MANILA, DAVAO CITY AND CEBU CITY, HIS RESIDENCE BEING IN COTABATO, WHICH ALL CONSTITUTE A DENIAL OF HIS RIGHT TO BE HEARD AND TO DUE PROCESS.

II. PETITIONER WAS LIKEWISE CLEARLY DENIED OF HIS RIGHT TO DUE PROCESS WHEN DUE TO THE RECKLESS AND GROSS NEGLIGENCE OF HIS FORMER COUNSEL, THE LATTER FAILED TO FILE A MOTION FOR NEW TRIAL TO REVERSE THE JUDGMENT OF CONVICTION BEFORE THE SANDIGANBAYAN OR TO FILE AN APPEAL TO THE SUPREME COURT FROM THE ADVERSE JUDGMENT OF CONVICTION.

III. IT IS HIGHLY UNJUST, INEQUITABLE AND UNCONSCIONABLE FOR PETITIONER TO BE PRESENTLY LANGUISHING IN JAIL WITHOUT HIS DEFENSE AGAINST THE CRIME CHARGED HAVING BEEN PRESENTED BEFORE THE HONORABLE SANDIGANBAYAN AND APPRECIATED BY THE SAID COURT, AND BY THIS HONORABLE SUPREME COURT IN CASE OF APPEAL FROM AN ADVERSE DECISION.

IV. REMAND OF THE INSTANT CASE TO THE COURT OF ORIGIN, OR TO THE HONORABLE SANDIGANBAYAN SO THAT PETITIONER CAN PRESENT HIS EVIDENCE BEFORE SAID COURT, ASSISTED BY NEW COUNSEL, IS PROPER AND JUSTIFIED, ESPECIALLY CONSIDERING THAT THE INSTANT CASE INVOLVES A CRIME OF ALLEGED MALVERSATION OF PUBLIC FUNDS WHICH HE NEVER COMMITTED, AND INVOLVES A HIGHER PENALTY OR TERM OF IMPRISONMENT.¹⁶

The petition must fail.

At the outset it must be emphasized that the special civil action of certiorari is not the proper remedy to challenge a judgment conviction rendered by the SB. Petitioner should have filed a petition for review on certiorari under Rule 45.

Pursuant to Section 7 of Presidential Decree No. 1606,¹⁷ as amended by Republic Act No. 8249, decisions and final orders of the Sandiganbayan shall be appealable to the Supreme Court by petition for review on certiorari raising pure questions of law in accordance with Rule 45 of the Rules of Court. Section 1 of Rule 45 of the Rules of Court provides that “[a] party desiring to appeal by certiorari from a judgment, final order or resolution of the x x x Sandiganbayan x x x whenever authorized by law, may file with the Supreme Court a verified petition for review on certiorari. The petition x x x shall raise only questions of law, which must be distinctly set forth.” Section 2 of Rule 45 likewise provides that the petition should be filed within the fifteen-day period from notice of the judgment or final order or resolution, or of the denial of petitioner’s motion for reconsideration filed in due time after notice of judgment.

As observed by the SB, the 15-day period of appeal, counted from the date of the promulgation of its decision on May 26, 2008, lapsed on June 10, 2008, which rendered the same final and executory. Petitioner’s motion for reconsideration was thus filed 6 days late. Petitioner’s resort to the present special civil action after failing to appeal within the fifteen-day reglementary period, cannot be done. The special civil action of certiorari cannot be used as a substitute for an appeal which the petitioner already lost.¹⁸

This Court has often enough reminded members of the bench and bar that a special civil action for certiorari under Rule 65 lies only when there is no appeal nor plain, speedy and adequate remedy in the ordinary course of law. Certiorari is not allowed when a party to a case fails to appeal a judgment or final order despite the availability of that remedy. The remedies of appeal and certiorari are mutually exclusive and not alternative or successive.¹⁹ Appeals though filed late were allowed in some rare cases, but there must be exceptional circumstances to justify the relaxation of the rules.

Petitioner claims that his right to due process was violated when his counsel failed to assist him during the promulgation of the judgment. He faults the Sandiganbayan for proceeding with the promulgation despite the petitioner not then being assisted by his counsel, and being a layman he is not familiar with court processes and procedure.

Section 6, Rule 120 of the Revised Rules of Criminal Procedure, as amended, provides:

SEC. 6. Promulgation of judgment. — The judgment is promulgated by reading it in the presence of the accused and any judge of the court in which it was rendered. However, if the conviction is for a light offense, the judgment may be pronounced in the presence of his counsel or representative. When the judge is absent or outside the province or city, the judgment may be promulgated by the clerk of court.

If the accused is confined or detained in another province or city, the judgment may be promulgated by the executive judge of the Regional Trial Court having jurisdiction over the place of confinement or detention upon request of the court which rendered the judgment. The court promulgating the judgment shall have authority to accept the notice of appeal and to approve the bail bond pending appeal; provided, that if the decision of the trial court convicting the accused changed the nature of the offense from non-bailable to bailable, the application for bail can only be filed and resolved by the appellate court.

The proper clerk of court shall give notice to the accused personally or through his bondsman or warden and counsel, requiring him to be present at the promulgation of the decision. If the accused was tried in absentia because he jumped bail or escaped from prison, the notice to him shall be served at his last known address.

In case the accused fails to appear at the scheduled date of promulgation of judgment despite notice, the promulgation shall be made by recording the judgment in the criminal docket and serving him a copy thereof at his last known address or thru his counsel.

If the judgment is for conviction and the failure of the accused to appear was without justifiable cause, he shall lose the remedies available in these Rules against the judgment and the court shall order his arrest. Within fifteen (15) days from promulgation of judgment, however, the accused may surrender and file a motion for leave of court to avail of these remedies. He shall state the reasons for his absence at the scheduled promulgation and if he proves that his absence was for a justifiable cause, he shall be allowed to avail of said remedies within fifteen (15) days from notice. (Emphasis supplied.)

There is nothing in the rules that requires the presence of counsel for the promulgation of the judgment of conviction to be valid. While notice must be served on both accused and his counsel, the latter’s absence during the promulgation of judgment would not affect the validity of the promulgation. Indeed, no substantial right of the accused on the merits was prejudiced by such absence of his counsel when the sentence was pronounced.²⁰

It is worth mentioning that petitioner never raised issue on the fact that his counsel was not around during the promulgation of the judgment in his motion for reconsideration which merely prayed for reopening of the case to enable him to present liquidation documents and receipts, citing financial constraints as the reason for his failure to attend the scheduled hearings. Before this Court he now submits that the gross negligence of his counsel deprived him of the opportunity to present defense evidence.

Perusing the records, we find that the prosecution made a formal offer of evidence on August 30, 2002. At the scheduled presentation of defense evidence on September 4, 2002, petitioner’s counsel, Atty. Manuel E. Iral, called the attention of the SB to the fact that he had just received a copy of said formal offer, and requested for 15 days to submit his comment thereon. The SB granted his request and set the case for hearing on December 2 and 3, 2002.²¹ No such comment had been filed by Atty. Iral. On November 18, 2002, due to difficulty in securing a quorum with five existing vacancies in the court, the SB thus reset the hearing to April 21 and 22, 2003.²² On January 14, 2003, the SB’s Second Division issued a resolution admitting Exhibits “A” to “N” after the defense failed to submit any comment to the formal offer of the prosecution, and stating that the previously scheduled hearings on April 21 and 22, 2003 shall proceed.²³ On April 11, 2003, the SB for the same reason again reset the hearing dates to August 11 and 12, 2003.²⁴

At the scheduled initial presentation of defense evidence on August 11, 2003, only petitioner appeared informing that when he passed by that morning to his counsel’s residence, the latter was ill and thus requested for postponement. Without objection from the prosecution and on condition that Atty. Iral will present a medical certificate within five days, the SB reset the hearing to October 16 and 17, 2003. The SB also said that if by the next hearing petitioner is not yet represented by his counsel, said court shall appoint a counsel de oficio in the person of Atty. Wilfredo C. Andres of the Public Attorney’s Office.²⁵ However, on October 16, 2003, the SB received a letter from petitioner requesting for postponement citing the untimely death of his nephew and swelling of his feet due to arthritis. He assured the court of his attendance in the next hearing it will set at a later date.²⁶ Accordingly, the SB reset the hearings to February 12 and 13, 2004.²⁷ On February 4, 2004, the SB again received a letter from petitioner requesting another postponement for medical (arthritis) and financial (lack of funds for attorney’s/appearance fee) reasons. He assured the court of his availability after the May 10, 2004 elections.²⁸ This time, the SB did not grant the request and declared the case submitted for decision on the basis of the evidence on record.²⁹

On March 30, 2004, Atty. Iral filed an Urgent Motion for Reconsideration of the February 12, 2004 order submitting the case for decision, citing circumstances beyond his control – the fact that he had no means to come to Manilafrom Kidapawan, North Cotabato, he being jobless for the past four years. He thus prayed to be allowed to present his evidence on May 17 and 18, 2004.³⁰ The prosecution opposed said motion, citing two postponements in which petitioner’s counsel have not submitted the required medical certificate and explanation and failure to be present on October 16, 2003.³¹

In the interest of justice, the SB reconsidered its earlier order submitting the case for decision and gave the petitioner a last chance to present his evidence on August 17 to 18, 2004.³² On August 17, 2004, Atty. Iral appeared but requested that presentation of evidence be postponed to the following day, which request was granted by the SB.³³ The next day, however, only petitioner appeared saying that his lawyer is indisposed. Over the objection of the prosecution and in the supreme interest of justice, the SB cancelled the hearing and rescheduled it to November 15 and 16, 2004. Atty. Iral was directed to submit a verified medical certificate within 10 days under pain of contempt, and the SB likewise appointed a counsel de oficio in the person of Atty. Roberto C. Omandam who was directed to be ready at the scheduled hearing in case petitioner’s counsel is not ready, stressing that the court will no longer grant any postponement. Still, petitioner was directed to secure the services of another counsel if Atty. Iral is not available.³⁴ With the declaration by Malacañang that November 15, 2004 is a special non-working holiday, the hearing was reset to November 16, 2004 as previously scheduled.³⁵

On November 16, 2004, Atty. Iral appeared but manifested that he has no witness available. Over the objection of the prosecution, hearing was reset to March 14 and 15, 2005. Atty. Iral agreed to submit the case for decision on the basis of prosecution evidence in the event that he is unable to present any witness on the aforesaid dates.³⁶ On March 14, 2005, the SB again reset the hearing dates to May 26 and 27, 2005 for lack of material time.³⁷ However, at the scheduled hearing on May 26, 2005, petitioner manifested to the court that Atty. Iral was rushed to the hospital having suffered a stroke, thereupon the hearing was rescheduled for September 21 and 22, 2005 with a directive for Atty. Iral to submit a verified medical certificate.³⁸ On September 22, 2005, Atty. Iral appeared but again manifested that he has no witness present in court. On the commitment of Atty. Iral that if by the next hearing he still fails to present their evidence the court shall consider them to have waived such right, the hearing was reset to February 8 and 9, 2006.³⁹ However, on February 9, 2006, the defense counsel manifested that he has some other commitment in another division of the SB and hence he is constrained to seek cancellation of the hearing. Without objection from the prosecution and considering that the intended witness was petitioner himself, the SB reset the hearing to April 17 and 18, 2006, which dates were later moved to August 7 and 8, 2006.⁴⁰ On August 7, 2006, over the objection of the prosecution, the SB granted the motion for postponement by the defense on the ground of lack of financial capacity. The hearing was for the last time reset to October 17 and 18, 2006, which date was later changed to October 11 and 12, 2006.⁴¹

On October 11, 2006, on motion of the prosecution, the SB resolved that the cases be submitted for decision for failure of the defense to appear and present their evidence, and directed the parties to present their respective memoranda within 30 days.⁴² As only the prosecution submitted a memorandum, the SB declared the cases submitted for decision on August 24, 2007.⁴³ Petitioner and his counsel were duly notified of the promulgation of decision, originally scheduled on February 28, 2008 but was moved to March 27, 2008 in view of the absence of petitioner and the Handling Prosecutor.⁴⁴ On that date, however, on motion of Atty. Iral, the promulgation was postponed to April 14, 2008.⁴⁵ On April 14, 2008, both petitioner and his counsel failed to appear, but since the notice to petitioner was sent only on April 3, 2008, the SB finally reset the promulgation of judgment to May 26, 2008.⁴⁶ While supposedly absent during the promulgation, records showed that Atty. Iral personally received on the same date a copy of the decision.⁴⁷

The foregoing shows that the defense was granted ample opportunity to present their evidence as in fact several postponements were made on account of Atty. Iral’s health condition and petitioner’s lack of financial resources to cover transportation costs. The SB exercised utmost leniency and compassion and even appointed a counsel de oficio when petitioner cited lack of money to pay for attorney’s fee. In those instances when either petitioner or his counsel was present in court, the following documentary evidence listed during the pre-trial, allegedly in the possession of petitioner, and which he undertook to present at the trial, were never produced in court at any time: (1) Liquidation Report by petitioner; (2) Certification of Accountant Zamba Lajaratu of the National Commission on Indigenous People, Region XII, Cotabato City; and (3) Different Certifications by project officers and barangay captains.⁴⁸ If indeed these documents existed, petitioner could have readily submitted them to the court considering the length of time he was given to do so. The fact that not a single document was produced and no witness was produced by the defense in a span of 4 years afforded them by the SB, it can be reasonably inferred that petitioner did not have those evidence in the first place.

The elements of malversation of public funds are:

1. that the offender is a public officer;
2. that he had the custody or control of funds or property by reason of the duties of his office;
3. that those funds or property were public funds or property for which he was accountable; and
4. that he appropriated, took, misappropriated or consented or, through abandonment or negligence, permitted another person to take them.⁴⁹

There is no dispute on the existence of the first three elements; petitioner admitted having received the cash advances for which he is accountable. As to the element of misappropriation, indeed petitioner failed to rebut the legal presumption that he had misappropriated the said public funds to his personal use, notwithstanding his unsubstantiated claim that he has in his possession liquidation documents. The SB therefore committed neither reversible error nor grave abuse of discretion in convicting the petitioner of malversation for failure to explain or account for his cash shortage by any liquidation or supporting documents. As this Court similarly ruled in one case⁵⁰:

In the crime of malversation, all that is necessary for conviction is sufficient proof that the accountable officer had received public funds, that he did not have them in his possession when demand therefor was made, and that he could not satisfactorily explain his failure to do so. Direct evidence of personal misappropriation by the accused is hardly necessary as long as the accused cannot explain satisfactorily the shortage in his accounts.

In convicting petitioner, the Sandiganbayan cites the presumption in Article 217, supra, of the Revised Penal Code, i.e., the failure of a public officer to have duly forthcoming any public funds or property with which he is chargeable, upon demand by any duly authorized officer, is prima facie evidence that he has put such missing fund or property to personal uses. The presumption is, of course, rebuttable. Accordingly, if the accused is able to present adequate evidence that can nullify any likelihood that he had put the funds or property to personal use, then that presumption would be at an end and the prima facie case is effectively negated. This Court has repeatedly said that when the absence of funds is not due to the personal use thereof by the accused, the presumption is completely destroyed; in fact, the presumption is never deemed to have existed at all. In this case, however, petitioner failed to overcome this prima facie evidence of guilt.

There is grave abuse of discretion where the public respondent acts in a capricious, whimsical, arbitrary or despotic manner in the exercise of its judgment as to be equivalent to lack of jurisdiction. The abuse of discretion must be so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law, or to act at all in contemplation of law as where the power is exercised in an arbitrary and despotic manner by reason of passion or hostility.⁵¹ Under the facts on record, we find no grave abuse of discretion on the part of the SB when it submitted the case for decision and rendered the judgment of conviction on the basis of the prosecution evidence after the defense failed to present its evidence despite ample opportunity to do so.

WHEREFORE, the petition is DISMISSED. The Decision promulgated on May 26, 2008 and Resolution issued on November 18, 2008 by the Sandiganbayan in Criminal Case No. 26327 are AFFIRMED.

With costs against the petitioner.

SO ORDERED.

C E R T I F I C A T I O N

Pursuant to Section 13, Article VIII of the 1987 Constitution, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

1Rollo, pp. 48-63. Penned by Associate Justice Edilberto G. Sandoval with Associate Justices Teresita V. Diaz-Baldos and Samuel R. Martires concurring.

2Id. at 64.

3Id. at 77.

4Id. at 84-85, 91 and 95; Exhibits “A,” “B,” “M” to “M-2,” “N,” Formal Offer of Evidence (Prosecution).

5Id. at 95-97, 102-103, 105-106, 108-109 and 111-112.

6Id. at 95.

7Exhibits “K” and “L,” Formal Offer of Evidence (Prosecution).

8Exhibits “D-2” to “D-5,” “E-2,” “F-2 ,” “G-2” and “H-2,” id.

9Exhibit “C,” id.

10Exhibits “I” and “J,” id.

11Rollo, p. 70.

12TSN, May 22, 2002, pp. 5-19.

13TSN, July 4, 2002, pp. 30-34.

14Rollo, pp. 60-61.

15Id. at 58-59.

16Id. at 17-18.

17Revising Presidential Decree No. 1486 Creating aSpecial Court to be Known as “Sandiganbayan” and for Other Purposes.

18People v. Sandiganbayan, G.R. No. 156394, January 21, 2005, 449 SCRA 205, 216.

19Id.

20See Jamilano v. Cuevas, No. L-33654, July 23, 1987, 152 SCRA 158, 161-162, citing U.S. v. Gimeno, 3 Phil. 233, 234.

21SB records (Crim. Case No. 26327), p. 242.

22Id. at 250.

23Id. at 259.

24Id. at 265.

25Id. at 273.

26Id. at 282-287.

27Id. at 294-296.

28Id. at 297.

29Id. at 298.

30Id. at 304.

31Id. at 309-311.

32Id. at 313.

33Id. at 320.

34Id. at 322.

35Id. at 328.

36Id. at 330.

37Id. at 340.

38Id. at 346-A.

39Id. at 362.

40Id. at 370, 377.

41Id. at 382, 386.

42Id. at 391.

43Id. at 441.

44Id. at 450.

45Id. at 458.

46Id. at 466.

47Id. at 489 (back).

48Rollo, p. 75.

49Ocampo III v. People, G.R. Nos. 156547-51, February 4, 2008, 543 SCRA 487, 505-506.

50Davalos, Sr. v. People, G.R. No. 145229, April 24, 2006, 488 SCRA 84, 92-93.

51People v. Sandiganbayan, supra note 18, at 218.

CASE 2012-0002: NATIONAL POWER CORPORATION VS. CIVIL SERVICE COMMISSION and RODRIGO A. TANFELIX (G.R. NO. 152093,  24 JANUARY 2012, ABAD J.) (BRIEF TITLE: NPC VS. CSC AND TANFELIX)

=================

ACCORDINGLY, the Court SETS ASIDE the decision of the Court of Appeals in CA-G.R. SP 62642 dated October 18, 2001 as well as Civil Service Commission Resolution 002816 dated December 21, 2000, ADJUDGES respondent Rodrigo A. Tanfelix guilty of grave misconduct, and IMPOSES on him the penalty of dismissal with the accessory penalties of forfeiture of retirement benefits, cancellation of eligibility, and perpetual disqualification from re-employment in the government service, including government-owned or controlled corporation.

SO ORDERED.

=================

EN BANC

NATIONAL POWER                               G.R. No. 152093

CORPORATION,

Petitioner,                        Present:

                                                                     CORONA, C.J., 

                                                                     CARPIO,

                                                            VELASCO, JR.,

                                                            LEONARDO-DE CASTRO,

                                                            BRION,

– versus –                                              PERALTA,

  BERSAMIN,

  DEL CASTILLO,

  ABAD,

  VILLARAMA, JR.,

  PEREZ,

  MENDOZA,

  SERENO,

  REYES, and

  PERLAS-BERNABE, JJ.

CIVIL SERVICE COMMISSION

and RODRIGO A. TANFELIX,               Promulgated:

                             Respondent.                  

                                                                      January 24, 2012           

x —————————————————————————————- x

DECISION

ABAD, J.:

          It is difficult to accept that an odious act like rigging a public bidding can get the public officer responsible for it wholly absolved of liability just because he was not a member of the bids committee that chose the winning bid.

The Facts and the Case

          On April 7, 1997 the President of petitioner National Power Corporation (NPC) filed an administrative action against respondent Rodrigo A. Tanfelix, a Supervising Mechanical Engineer, for rigging the bidding for the construction of the wind break fence of its thermal power plant’s coal storage in Calaca, Batangas. 

After hearing, the NPC’s Board of Inquiry and Discipline (BID) found Tanfelix guilty of grave misconduct for rigging the bidding to favor ALC Industries, Inc. (ALC), one of the five pre-qualified contractors.  Two witnesses, the board chairman of one of the losing bidders, Ley Construction and Development Corp. (LCDC), and the head of the latter’s engineering department, testified that Tanfelix invited the pre-qualified bidders to a restaurant meeting and offered P1 million each to four of them in exchange for letting ALC win the bidding.  He also built into the successful bid a P2 million fee for arranging the rig and for padding NPC’s price estimate so the winning bid could make it big.  Days later, the heads of ALC and LCDC met and signed in Tanfelix’s presence a memorandum of agreement that embodied the bid-rigging deal between the two companies.  ALC won the bidding.  With this finding, the NPC discipline board ordered Tanfelix dismissed from the service.

          On November 9, 1999, acting on Tanfelix’s appeal, the Civil Service Commission (CSC) rendered a decision, affirming the NPC-BID ruling.  But, on motion for reconsideration, the CSC reversed itself and exonerated Tanfelix in a resolution dated December 21, 2000.  The CSC ruled in the main that the misconduct which warrants removal must have direct relation to and be connected with the performance of official duties.  As it happened, Tanfelix was neither a member of the NPC bids committee nor was there any proof that he influenced the members of that committee.

          The NPC appealed to the Court of Appeals (CA) but on October 18, 2001 the latter affirmed the ultimate ruling of the CSC.  The NPC questions the CA decision before this Court.

The Issue Presented

          The issue in this case is whether or not the CA, like the CSC, correctly absolved Tanfelix of any administrative liability for rigging the bids on an NPC construction contract since he was not a member of the bids committee that awarded it to a pre-selected bidder.

Argument

It is unmistakable from the evidence that Tanfelix wrongfully and unlawfully used his station or reputation as NPC Supervising Mechanical Engineer to rig the bids for an NPC construction project.  Although he was not a member of NPC’s bids committee, he was NPC’s supervising mechanical engineer.  Undoubtedly, Tanfelix misused his position to gain access to information on construction projects that were up for bidding and to the NPC staffs involved in them.  And he misused his reputation and credibility as ranking NPC officer to bring the pre-qualified bidders together in a restaurant to hammer out with them a scheme for cheating NPC of a large sum of money, the result of rigged bids. 

It is of course true, as the CSC suggested, that the evidence fails to show that Tanfelix tried to influence the members of the bids committee.  But there was really no need to influence them since Tanfelix already succeeded in rigging the bids among the pre-qualified bidders, leaving the bids committee no choice but to award the contract to ALC. 

Grave misconduct, of which Tanfelix has been charged, consists in a government official’s deliberate violation of a rule of law or standard of behavior.  It is regarded as grave when the elements of corruption, clear intent to violate the law, or flagrant disregard of established rules are present.^[1][1]  In particular, corruption as an element of grave misconduct consists in the official’s unlawful and wrongful use of his station or character [reputation]^[2][2] to procure some benefit for himself or for another person, contrary to duty and the rights of others.^[3][3]  Rigging by a public official at a bidding in the organization where he belongs is a specie of corruption. 

As a public officer, Tanfelix had the duty to protect the process of public bidding in the NPC, his organization.  The requirement of public bidding is not an idle ceremony.  It is the accepted method for arriving at a fair and reasonable price.  It ensures that overpricing, favoritism, and other anomalous practices are eliminated or minimized.^[4][4]  A ruling that would absolve Tanfelix of any liability for rigging the bids in the government office where he works on the pretext that he was not a member of the bids and awards committee would encourage public officers who are not members of bids committees to make an industry of rigging bids, using their offices and official reputations. 

          ACCORDINGLY, the Court SETS ASIDE the decision of the Court of Appeals in CA-G.R. SP 62642 dated October 18, 2001 as well as Civil Service Commission Resolution 002816 dated December 21, 2000, ADJUDGES respondent Rodrigo A. Tanfelix guilty of grave misconduct, and IMPOSES on him the penalty of dismissal with the accessory penalties of forfeiture of retirement benefits, cancellation of eligibility, and perpetual disqualification from re-employment in the government service, including government-owned or controlled corporation.

          SO ORDERED.

ROBERTO A. ABAD

                                                              Associate Justice

WE CONCUR:

RENATO C. CORONA

Chief Justice

       ANTONIO T. CARPIO              PRESBITERO J. VELASCO, JR.    

   Associate Justice                                   Associate Justice

TERESITA J. LEONARDO-DE CASTRO       ARTURO D. BRION

                     Associate Justice                                 Associate Justice

       DIOSDADO M. PERALTA                     LUCAS P. BERSAMIN

                 Associate Justice                                      Associate Justice        

 MARIANO C. DEL CASTILLO             MARTIN S. VILLARAMA, JR.

              Associate Justice                                     Associate Justice

   JOSE PORTUGAL PEREZ                            JOSE CATRAL MENDOZA

             Associate Justice                                                 Associate Justice

MARIA LOURDES P. A. SERENO                      BIENVENIDO L. REYES

               Associate Justice                                       Associate Justice

ESTELA M. PERLAS-BERNABE

Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court.

RENATO C. CORONA

          Chief Justice