J.A.B. Bulao & Associates

CASE 2012-0006: ANITA L. MIRANDA VS. THE PEOPLE OF THE PHILIPPINES (G.R. No. 176298, 25 JANUARY 2012, VILLARAMA, JR., J.) SUBJECT/S: ACCOUNTANT DEPOSITED CHECKS TO ACCOUNT OF VIVA AND WITHDREW PROCEEDS, LIABLE FOR QUALIFIED THEFT, NOT ESTAFA; COMPUTATION OF PENALTY FOR QUALIFIED THEFT; PENALTY INCREASED TO RECLUSION PERPETUA FOR STOLEN AMOUNT OF P797,187.85. (BRIEF TITLE: MIRANDA VS. PEOPLE).

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DISPOSITIVE:

WHEREFORE, the January 11, 2007 Decision of the Court of Appeals in CA-G.R. CR No. 29858 affirming the conviction of petitioner Anita L. Miranda for the crime of qualified theft is AFFIRMED with the MODIFICATION that the penalty is increased to reclusion perpetua.

With costs against the petitioner.

SO ORDERED.

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FIRST DIVISION

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DECISION

VILLARAMA, JR., J.:

Petitioner Anita L. Miranda appeals the January 11, 2007 Decision¹ of the Court of Appeals (CA) affirming the judgment² of the Regional Trial Court (RTC) of Manila, Branch 20, convicting her of qualified theft.

Petitioner was charged with qualified theft in an Information dated November 28, 2002. The Information reads:

That in or about and during the period comprised between April 28, 1998 and May 2, 2002, inclusive, in the City of Manila, Philippines, the said accused, did then and there wilfully, unlawfully and feloniously, with intent of gain and without the knowledge and consent of the owner thereof, take, steal and carry away the total amount of P797,187.85 belonging to VIDEO CITY COMMERCIAL, INC. and VIVA VIDEOCITY, INC. represented by MIGUEL Q. SAMILLANO, in the following manner, to wit: by making herself the payee in forty-two pre-signed BPI Family Bank checks in the account of Video City Commercial and Jefferson Tan (the latter as franchise[e]) and encashing said checks in the total amount of P797,187.85, for her personal benefit, to the damage and prejudice of said owner in the aforesaid amount of P797,187.85, Philippine Currency.

That the said accused acted with grave abuse of confidence, she being then employed as bookkeeper in the aforesaid firm and as such was privy to the financial records and checks belonging to complainant and was actually entrusted with the said financial records, documents and checks and their transactions thereof in behalf of complainant.³

Upon arraignment, petitioner pleaded not guilty. Trial thereafter ensued.

Summarily, the prosecution proved the following facts: Video City Commercial, Inc. (VCCI) and Viva Video City, Inc. (Viva) were sister companies which managed a chain of stores known as VideoCity. These stores, some company-owned while others were operated in joint ventures with franchisees, were engaged in the sale and rental of video-related merchandises. During the period of April 28, 1998 to May 2, 2002, petitioner was the accounting clerk and bookkeeper of VCCI and Viva. One of her duties was to disburse checks for the accounts she handled. She was assigned to handle twelve (12) VideoCitystore franchise accounts, including those of Tommy Uy, Wilma Cheng, Jefferson Tan and Sharon Cuneta. As regards the franchisee Jefferson Tan, who was out of the country most of the time, Tan pre-signed checks to cover the store’s disbursements and entrusted them to petitioner. The pre-signed checks by Jefferson Tan were from a current account maintained jointly by VCCI and Jefferson Tan at BPI Family Bank, Sta. Mesa. There was also an existing agreement with the bank that any disbursement not exceeding P20,000.00 would require only Tan’s signature.⁴

Taking advantage of Tan’s constant absence from the country, petitioner was able to use Tan’s joint-venture bank account with VCCI as a clearing house for her unauthorized transfer of funds. Petitioner deposited VCCI checks coming from other franchisees’ accounts into the said bank account, and withdrew the funds by writing checks to her name using the checks pre-signed by Tan. It was only after petitioner went on maternity leave and her subsequent resignation from the company in May 2002 that an audit was conducted since she refused to turn over all the financial records in her possession. The audit was made on all the accounts handled by petitioner and it was discovered that she made unauthorized withdrawals and fund transfers amounting to P4,877,759.60.⁵

The prosecution, in proving that petitioner had unlawfully withdrawn P797,187.85 for her own benefit, presented as its witness Jose Laureola, the assistant manager/acting cashier of BPI Family Bank, Sta. Mesa Branch. Laureola presented a microfilm of the checks, the encashed checks and deposit slips. He also presented the bank statement of VCCI which showed the encashment of forty-two (42) checks from the account of VCCI and Jefferson Tan amounting to P797,187.85.⁶

In the face of the prosecution’s evidence, petitioner chose not to present any evidence during trial.

On October 7, 2005, the RTC found petitioner guilty beyond reasonable doubt of qualified theft. The RTC sentenced her to suffer the indeterminate penalty of eight (8) years and one (1) day of prision mayor, as minimum, to eighteen (18) years, two (2) months and twenty-one (21) days of reclusion temporal, as maximum, and to pay VCCI P797,187.85 plus costs.⁷

The RTC found that the prosecution was able to establish that the checks deposited to the joint account of VCCI and Jefferson Tan at BPI Family Bank were unlawfully withdrawn by the petitioner without VCCI’s consent. Petitioner took advantage of her position with VCCI and her access to the checks and its bank accounts.

On appeal, the CA affirmed the decision of the RTC. The CA held that contrary to petitioner’s claim that the prosecution failed to show who was the absolute owner of the thing stolen, there was no doubt that the personal property taken by petitioner does not belong to her but to Jefferson Tan and his joint venture partner VCCI. Thus, petitioner was able to gain from taking other people’s property without their consent. More, she was able to perpetrate the crime due to her position in VCCI which gave her access to the joint venture account of VCCI and Jefferson Tan, both of whom reposed trust and confidence in her. She exploited said trust and confidence to their damage in the amount of P797,187.85.

Undaunted, petitioner filed the instant petition for review on certiorari before this Court, raising the following issues:

1. WHETHER OR NOT THE ACCUSED IS GUILTY BEYOND REASONABLE DOUBT OF THE CRIME OF QUALIFIED THEFT.

1-a. WHETHER THE PHRASE “X X X SHALL TAKE THE PERSONAL PROPERTY OF ANOTHER WITHOUT THE LATTER’S CONSENT X X X” IN ARTICLE 308 OF THE REVISED PENAL CODE IN RELATION TO ARTICLE 310 OF THE SAME CODE WOULD REQUIRE AS AN ELEMENT OF “QUALIFIED THEFT” AN ESTABLISHED PROOF OF “OWNERSHIP” OF THE PROPERTY ALLEGEDLY STOLEN?

1-b. WHETHER IT IS IMPERATIVE THAT THE DUE EXECUTION AND AUTHENTICITY OF THE ALLEGED SIGNATURES OF THE ACCUSED IN THE CHECKS BE FULLY ESTABLISHED AND IDENTIFIED AND IF NOT SO ESTABLISHED AND IDENTIFIED, THE SAME WOULD BE A FATAL FLAW IN THE EVIDENCE OF THE PROSECUTION WHICH INEVITABLY WOULD LEAD TO ACCUSED’S ACQUITTAL?

1-c. WHETHER THE FAILURE TO ESTABLISH AND AUTHENTICATE OR IDENTIFY THE SIGNATURES OF THE ACCUSED ANNIE MIRANDA AND JEFFERSON TAN CONSTITUTED A FATAL FLAW IN PROVING THAT THE ACCUSED AND JEFFERSON TAN WERE THE AUTHORS OF SAID SIGNATURES?

1-d. [WHETHER THE] CONCLUSION OF FACTS BY THE REGIONAL TRIAL COURT AND COURT OF APPEALS ARE NOT SUPPORTED BY EVIDENCE.

1-e. WHETHER THE CHECKS AND VOUCHERS PRESENTED AS EVIDENCE NOT IN THEIR ORIGINALS SHOULD HAVE BEEN DENIED ADMISSION BY THE COURT A QUO, THERE BEING NO SUFFICIENT FACTS ADDUCED TO JUSTIFY THE PRESENTATION OF XEROX COPIES OR SECONDARY EVIDENCE.⁸

Essentially, the issue for our resolution is whether the CA correctly affirmed petitioner’s conviction for qualified theft.

Petitioner insists that she should not have been convicted of qualified theft as the prosecution failed to prove the private complainant’s absolute ownership of the thing stolen. Further, she maintains that Jefferson Tan’s signatures on the checks were not identified by any witness who is familiar with his signature. She likewise stresses that the checks and vouchers presented by the prosecution were not original copies and that no secondary evidence was presented in lieu of the former.

The appeal lacks merit.

A careful review of the records of this case and the parties’ submissions leads the Court to conclude that there exists no cogent reason to disturb the decision of the CA. We note that the arguments raised by petitioner in her petition are a mere rehash of her arguments raised before, and correctly resolved by, the CA.

The elements of the crime of theft as provided for in Article 308⁹ of the Revised Penal Code are as follows: (1) that there be taking of personal property; (2) that said property belongs to another; (3) that the taking be done with intent to gain; (4) that the taking be done without the consent of the owner; and (5) that the taking be accomplished without the use of violence against or intimidation of persons or force upon things.¹⁰ Theft becomes qualified when any of the following circumstances under Article 310¹¹ is present: (1) the theft is committed by a domestic servant; (2) the theft is committed with grave abuse of confidence; (3) the property stolen is either a motor vehicle, mail matter or large cattle; (4) the property stolen consists of coconuts taken from the premises of a plantation; (5) the property stolen is fish taken from a fishpond or fishery; and (6) the property was taken on the occasion of fire, earthquake, typhoon, volcanic eruption, or any other calamity, vehicular accident or civil disturbance.¹²

Here, the prosecution was able to prove beyond reasonable doubt that the amount of P797,187.85 taken does not belong to petitioner but to VCCI and that petitioner took it without VCCI’s consent and with grave abuse of confidence by taking advantage of her position as accountant and bookkeeper. The prosecution’s evidence proved that petitioner was entrusted with checks payable to VCCI or Viva by virtue of her position as accountant and bookkeeper. She deposited the said checks to the joint account maintained by VCCI and Jefferson Tan, then withdrew a total of P797,187.85 from said joint account using the pre-signed checks, with her as the payee. In other words, the bank account was merely the instrument through which petitioner stole from her employer VCCI.

We find no cogent reason to disturb the above findings of the trial court which were affirmed by the CA and fully supported by the evidence on record. Time and again, the Court has held that the facts found by the trial court, as affirmed in toto by the CA, are as a general rule, conclusive upon this Court¹³ in the absence of any showing of grave abuse of discretion. In this case, none of the exceptions to the general rule on conclusiveness of said findings of facts are applicable.¹⁴ The Court gives weight and respect to the trial court’s findings in criminal prosecution because the latter is in a better position to decide the question, having heard the witnesses in person and observed their deportment and manner of testifying during the trial.¹⁵ Absent any showing that the lower courts overlooked substantial facts and circumstances, which if considered, would change the result of the case, this Court gives deference to the trial court’s appreciation of the facts and of the credibility of witnesses.

Moreover, we agree with the CA when it gave short shrift to petitioner’s argument that full ownership of the thing stolen needed to be established first before she could be convicted of qualified theft. As correctly held by the CA, the subject of the crime of theft is any personal property belonging to another. Hence, as long as the property taken does not belong to the accused who has a valid claim thereover, it is immaterial whether said offender stole it from the owner, a mere possessor, or even a thief of the property.¹⁶ In any event, as stated above, the factual findings of the courts a quo as to the ownership of the amount petitioner stole is conclusive upon this Court, the finding being adequately supported by the evidence on record.

However, notwithstanding the correctness of the finding of petitioner’s guilt, a modification is called for as regards the imposable penalty. On the imposition of the correct penalty, People v. Mercado¹⁷ is instructive. Pursuant to said case, in the determination of the penalty for qualified theft, note is taken of the value of the property stolen, which is P797,187.85 in this case. Since the value exceeds P22,000.00, the basic penalty is prision mayor in its minimum and medium periods to be imposed in the maximum period, that is, eight (8) years, eight (8) months and one (1) day to ten (10) years of prision mayor.

To determine the additional years of imprisonment to be added to the basic penalty, the amount of P22,000.00 is deducted from P797,187.85, which yields a remainder of P775,187.85. This amount is then divided by P10,000.00, disregarding any amount less than P10,000.00. The end result is that 77 years should be added to the basic penalty. However, the total imposable penalty for simple theft should not exceed 20 years. Thus, had petitioner committed simple theft, the penalty would be 20 years of reclusion temporal. As the penalty for qualified theft is two degrees higher, the trial court, as well as the appellate court, should have imposed the penalty of reclusion perpetua.

WHEREFORE, the January 11, 2007 Decision of the Court of Appeals in CA-G.R. CR No. 29858 affirming the conviction of petitioner Anita L. Miranda for the crime of qualified theft is AFFIRMED with the MODIFICATION that the penalty is increased to reclusion perpetua.

With costs against the petitioner.

SO ORDERED.

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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. 24-35. Penned by Associate Justice Amelita G. Tolentino with Associate Justices Conrado M. Vasquez, Jr. and Lucenito N. Tagle concurring. The assailed decision was rendered in CA-G.R. CR No. 29858.

2CA rollo, pp. 33-42. The decision of the RTC was penned by Judge Marivic T. Balisi-Umali.

3Records, p. 1.

4CA rollo, pp. 34-39; rollo, pp. 26-27.

5Id.

6Id. at 38.

7Id. at 39-41.

8Rollo, pp. 12-14.

9Art. 308. Who are liable for theft. – Theft is committed by any person who, with intent to gain but without violence against, or intimidation of persons nor force upon things, shall take personal property of another without the latter’s consent.

x x x x

10People v. Sison, G.R. No. 123183, January 19, 2000, 322 SCRA 345, 363-364.

11Art. 310. Qualified theft. – The crime of theft shall be punished by the penalties next higher by two degrees than those respectively specified in the next preceding article, if committed by a domestic servant, or with grave abuse of confidence, or if the property stolen is motor vehicle, mail matter or large cattle or consists of coconuts taken from the premises of a plantation, fish taken from a fishpond or fishery or if property is taken on the occasion of fire, earthquake, typhoon, volcanic eruption, or any other calamity, vehicular accident or civil disturbance.

12People v. Sison, supra note 10 at 364.

13See Cosmos Bottling Corporation v. Nagrama, Jr., G.R. No. 164403, March 4, 2008, 547 SCRA 571, 584, citing The Philippine American Life and General Insurance Co. v. Gramaje, G.R. No. 156963, November 11, 2004, 442 SCRA 274, 283.

14See Reyes v. CA, 328 Phil. 171, 179-180 (1996) citing Floro v. Llenado, 314 Phil. 715, 727-728 (1995). The Court, however, may determine the factual milieu of cases or controversies under specific circumstances, such as:

(1) when the inference made is manifestly mistaken, absurd or impossible;

(2) when there is a grave abuse of discretion;

(3) when the finding is grounded entirely on speculations, surmises or conjectures;

(4) when the judgment of the Court of Appeals is based on misapprehension of facts;

(5) when the findings of fact are conflicting;

(6) when the Court of Appeals, in making its findings, went beyond the issues of the case and the same is contrary to the admissions of both appellant and appellee;

(7) when the findings of the Court of Appeals are contrary to those of the trial court;

(8) when the findings of fact are conclusions without citation of specific evidence on which they are based;

(9) when the Court of Appeals manifestly overlooked certain relevant facts not disputed by the parties and which, if properly considered, would justify a different conclusion;

(10) when the findings of fact of the Court of Appeals are premised on the absence of evidence and are contradicted by the evidence on record.

15People v. Martinada, G.R. Nos. 66401-03, February 13, 1991, 194 SCRA 36, 41.

16Florenz D. Regalado, Criminal Law Conspectus, First edition, p. 522.

17G.R. No. 143676, February 19, 2003, 397 SCRA 746, 758.

CASE 2012-0005: MAGSAYSAY MARITIME CORPORATION AND/OR WASTFEL-LARSEN MANAGEMENT A/S VS. OBERTO S. LOBUSTA (G.R. NO. 177578, 25 JANUARY 2012, VILLARAMA, JR., J.) SUBJECT/S: LABOR CODE APPLIES TO CLAIMS UNDER POEA-APPROVED CONTRACTS; CONCEPT OF PERMANENT TOTAL DISABILITY; ORDERS OF COURT TO FILE PLEADINGS ARE NOT MERE REQUESTS, DISOBEDIENCE CONSTITUTES CONTEMPT. (BRIEF TITLE: MAGSAYSAY MARITIME VS. LOBUSTA)

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DISPOSITIVE:

WHEREFORE, we DENY the present petition for review on certiorari and AFFIRM the Decision dated August 18, 2006 of the Court of Appeals and its Resolution dated April 19, 2007 in CA-G.R. SP No. 74035. We ORDER petitioners Magsaysay Maritime Corporation and/or Wastfel-Larsen Management A/S to pay respondent Oberto S. Lobusta US$65,163 as total award, to be paid in Philippine pesos at the exchange rate prevailing during the time of payment.

With costs against the petitioners.

SO ORDERED.

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FIRST DIVISION

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DECISION

VILLARAMA, JR., J.:

Petitioners appeal the Decision¹ dated August 18, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 74035 and its Resolution² dated April 19, 2007, denying the motion for reconsideration thereof. The CA declared that respondent is suffering from permanent total disability and ordered petitioners to pay him US$2,060 as medical allowance, US$60,000 as disability benefits and 5% of the total monetary award as attorney’s fees.

The facts follow:

Petitioner Magsaysay Maritime Corporation is a domestic corporation and the local manning agent of the vessel MV “Fossanger” and of petitioner Wastfel-Larsen Management A/S.³

Respondent Oberto S. Lobusta is a seaman who has worked for Magsaysay Maritime Corporation since 1994.⁴ In March 1998, he was hired again as Able Seaman by Magsaysay Maritime Corporation in behalf of its principal Wastfel-Larsen Management A/S. The employment contract⁵ provides for Lobusta’s basic salary of US$515 and overtime pay of US$206 per month. It also provides that the standard terms and conditions governing the employment of Filipino seafarers on board ocean-going vessels, approved per Department Order No. 33 of the Department of Labor and Employment and Memorandum Circular No. 55 of the Philippine Overseas Employment Administration (POEA Standard Employment Contract), both series of 1996, shall be strictly and faithfully observed.

Lobusta boarded MV “Fossanger” on March 16, 1998.⁶ After two months, he complained of breathing difficulty and back pain. On May 12, 1998, while the vessel was in Singapore, Lobusta was admitted at Gleneagles Maritime Medical Center and was diagnosed to be suffering from severe acute bronchial asthma with secondary infection and lumbosacral muscle strain. Dr. C K Lee certified that Lobusta was fit for discharge on May 21, 1998, for repatriation for further treatment.⁷

Upon repatriation, Lobusta was referred to MetropolitanHospital. The medical coordinator, Dr. Robert Lim, issued numerous medical reports regarding Lobusta’s condition. Lobusta was first seen by a Pulmonologist and an Orthopedic Surgeon on May 22, 1998.⁸ Upon reexamination by the Orthopedic Surgeon on August 11, 1998, he opined that Lobusta needs surgery, called decompression laminectomy,⁹ which was done on August 30, 1998.¹⁰ On October 12, 1998, Dr. Lim issued another medical report stating the opinion of the Orthopedic Surgeon that the prognosis for Lobusta’s recovery after the spine surgery is good. However, the Pulmonologist opined that Lobusta’s obstructive airway disease needs to be monitored regularly and that Lobusta needs to be on bronchodilator indefinitely. Hence, Lobusta should be declared disabled with a suggested disability grading of 10-20%.¹¹ The suggestion was not heeded and Lobusta’s treatment continued.

On February 16, 1999, Lobusta was reexamined. Dr. Lim reported that Lobusta still complains of pain at the lumbosacral area although the EMG/NCV¹² test revealed normal findings. Lobusta was prescribed medications and was advised to return on March 16, 1999 for re-evaluation.¹³

On February 19, 1999, Dr. Lim reported that Lobusta has been diagnosed to have a moderate obstructive pulmonary disease which tends to be a chronic problem, such that Lobusta needs to be on medications indefinitely. Dr. Lim also stated that Lobusta has probably reached his maximum medical care.¹⁴

Petitioners “then faced the need for confirmation and grading by a second opinion” and “it took the parties time to agree on a common doctor, until they agreed on Dr. Camilo Roa.”¹⁵ Dr. Roa’s clinical summary states that Lobusta’s latest follow-up check-up was on December 16, 1999; that Lobusta is not physically fit to resume his normal work as a seaman due to the persistence of his symptoms; that his asthma will remain chronically active and will be marked by intermittent exacerbations; and that he needs multiple controller medications for his asthma.¹⁶

As the parties failed to reach a settlement as to the amount to which Lobusta is entitled, Lobusta filed on October 2, 2000, a complaint¹⁷ for disability/medical benefits against petitioners before the National Labor Relations Commission (NLRC).

Sometime in October 2000, Magsaysay Maritime Corporation suggested that Lobusta be examined by another company-designated doctor for an independent medical examination. The parties agreed on an independent medical examination by Dr. Annette M. David, whose findings it was agreed upon, would be considered final.

On November 17, 2000, Dr. David interviewed and examined Lobusta.¹⁸ Pertinent portions of Dr. David’s report read:

xxx Based on the Classes of Respiratory Impairment as described in the American Medical Association’s Guidelines for the Evaluation of Permanent Impairment, this is equivalent to Class 2 or Mild Impairment of the Whole Person (level of impairment: 10-25% of the whole person). Given the persistence of the symptoms despite an adequate medical regimen, the impairment may be considered permanent.

The determination of disability and fitness for duty/return-to-work is more complex. During asymptomatic periods, Mr. Lobusta could conceivably be capable of performing the duties and responsibilities of an Able Seaman as listed in the memos provided by Pandiman (Duties of an Able Seaman on board an average vessel, January 26, 2000; and Deck Crew general Responsibilities, 95.11.01). However, consideration needs to be given to the following:

• During the personal interview, Mr. Lobusta reported the need to use a self-contained breathing apparatus (SCBA) for “double bottom” work. While the use of these devices may not appreciably increase the work of breathing, an individual who develops an acute asthmatic attack under conditions requiring the use of an SCBA (oxygen-poor atmospheres) may be at increased risk for a poor outcome.
• When out at sea, the medical facilities on board an average vessel may not be adequate to provide appropriate care for an acute asthmatic exacerbation. Severe asthmatic attacks require life-sustaining procedures such as endotracheal intubation and on occasion, mechanical ventilation. Asthma can be fatal if not treated immediately. The distance from and the time required to transport an individual having an acute asthmatic attack on a vessel at sea to the appropriate medical facilities on land are important factors in the decision regarding fitness for duty.
• Several of the duties listed for an Able Seaman require the use of a variety of chemical substances (e.g. grease, solvents, cleaning agents, de-greasers, paint, etc.), many of which are known or suspected asthma triggers in sensitized individuals. The potential for an Able Seaman’s exposure to these asthma triggers is considerable.

Taken altogether, it is my opinion that Mr. Lobusta ought not to be considered fit to return to work as an Able Seaman. While the degree of impairment is mild, for the reasons stated above, it would be in the interest of all parties involved if he were to no longer be considered as capable of gainful employment as a seafarer. It is possible that he may perform adequately in another capacity, given a land-based assignment.¹⁹ (Stress in the original by Dr. David.)

As no settlement was reached despite the above findings, the Labor Arbiter ordered the parties to file their respective position papers.

On April 20, 2001, the Labor Arbiter rendered a decision²⁰ ordering petitioners to pay Lobusta (a) US$2,060 as medical allowance, (b) US$20,154 as disability benefits, and (c) 5% of the awards as attorney’s fees.

The Labor Arbiter ruled that Lobusta suffered illness during the term of his contract. Hence, petitioners are liable to pay Lobusta his medical allowance for 120 days or a total of US$2,060. The Labor Arbiter held that provisions of the Labor Code, as amended, on permanent total disability do not apply to overseas seafarers. Hence, he awarded Lobusta US$20,154 instead of US$60,000, the maximum rate for permanent and total disability under Section 30 and 30-A of the 1996 POEA Standard Employment Contract. The Labor Arbiter also awarded attorney’s fees equivalent to 5% of the total award since Lobusta was assisted by counsel.²¹

Lobusta appealed. The NLRC dismissed his appeal and affirmed the Labor Arbiter’s decision. The NLRC ruled that Lobusta’s condition may only be considered permanent partial disability. While Dr. David suggested that Lobusta’s prospects as seafarer may have been restricted by his bronchial asthma, Dr. David also stated that the degree of impairment is mild. Said qualification puts Lobusta’s medical condition outside the definition of total permanent disability, said the NLRC.²² Later, the NLRC also denied Lobusta’s motion for reconsideration.

Unsatisfied, Lobusta brought the case to the CA under Rule 65 of the 1997 Rules of Civil Procedure, as amended. As aforesaid, the CA declared that Lobusta is suffering from permanent total disability and increased the award of disability benefits in his favor to US$60,000, to wit:

WHEREFORE, the petition for certiorari is hereby GRANTED. The challenged resolution of the NLRC dated 20 June 2002 is MODIFIED, declaring [Lobusta] to be suffering from permanent total disability.

[Petitioners] are ORDERED to pay [Lobusta] the following:

a) US$2,060.00 as medical allowance,

b) US$60,000.00 as disability benefits, and

c) 5% of the total monetary award as attorney’s fees

x x x x²³

The CA faulted the NLRC for “plucking only particular phrases” from Dr. David’s report and said that the NLRC cannot wantonly disregard the full import of said report. The CA ruled that Lobusta’s disability brought about by his bronchial asthma is permanent and total as he had been unable to work since May 14, 1998 up to the present or for more than 120 days, and because Dr. David found him not fit to return to work as an able seaman.

Hence, this petition which raises two legal issues:

WHETHER OR NOT THE POEA CONTRACT CONSIDERS THE MERE LAPSE OF MORE THAN ONE HUNDRED TWENTY (120) DAYS AS TOTAL AND PERMANENT DISABILITY.

WHETHER OR NOT THERE IS LEGAL BASIS TO AWARD RESPONDENT LOBUSTA ATTORNEY’S FEES.²⁴

Petitioners argue that the CA erred in applying the provisions of the Labor Code instead of the provisions of the POEA contract in determining Lobusta’s disability, and in ruling that the mere lapse of 120 days entitles Lobusta to total and permanent disability benefits. The CA allegedly erred also in holding them liable for attorney’s fees, despite the absence of legal and factual bases.

The petition lacks merit.

Petitioners are mistaken that it is only the POEA Standard Employment Contract that must be considered in determining Lobusta’s disability. In Palisoc v. Easways Marine, Inc.,²⁵ we said that whether the Labor Code’s provision on permanent total disability applies to seafarers is already a settled matter. In Palisoc, we cited the earlier case of Remigio v. National Labor Relations Commission²⁶ where we said (1) that the standard employment contract for seafarers was formulated by the POEA pursuant to its mandate under Executive Order No. 247²⁷ “to secure the best terms and conditions of employment of Filipino contract workers and ensure compliance therewith,” and “to promote and protect the well-being of Filipino workers overseas”; (2) that Section 29 of the 1996 POEA Standard Employment Contract itself provides that all rights and obligations of the parties to the contract, including the annexes thereof, shall be governed by the laws of the Republic of the Philippines, international conventions, treaties and covenants where the Philippines is a signatory; and (3) that even without this provision, a contract of labor is so impressed with public interest that the Civil Code expressly subjects it to the special laws on labor unions, collective bargaining, strikes and lockouts, closed shop, wages, working conditions, hours of labor and similar subjects.²⁸

In affirming the Labor Code concept of permanent total disability, Remigio further stated:

Thus, the Court has applied the Labor Code concept of permanent total disability to the case of seafarers. In Philippine Transmarine Carriers v. NLRC, seaman Carlos Nietes was found to be suffering from congestive heart failure and cardiomyopathy and was declared as unfit to work by the company-accredited physician. The Court affirmed the award of disability benefits to the seaman, citing ECC v. Sanico, GSIS v. CA, and Bejerano v. ECC that “disability should not be understood more on its medical significance but on the loss of earning capacity. Permanent total disability means disablement of an employee to earn wages in the same kind of work, or work of similar nature that [he] was trained for or accustomed to perform, or any kind of work which a person of [his] mentality and attainment could do. It does not mean absolute helplessness.” It likewise cited Bejerano v. ECC, that in a disability compensation, it is not the injury which is compensated, but rather it is the incapacity to work resulting in the impairment of one’s earning capacity.

The same principles were cited in the more recent case of Crystal Shipping, Inc. v. Natividad. In addition, the Court cited GSIS v. Cadiz and Ijares v. CA that “permanent disability is the inability of a worker to perform his job for more than 120 days, regardless of whether or not he loses the use of any part of his body.”

x x x x

These facts clearly prove that petitioner was unfit to work as drummer for at least 11-13 months – from the onset of his ailment on March 16, 1998 to 8-10 months after June 25, 1998. This, by itself, already constitutes permanent total disability. x x x²⁹

In Vergara v. Hammonia Maritime Services, Inc.,³⁰ we also said that the standard terms of the POEA Standard Employment Contract agreed upon are intended to be read and understood in accordance with Philippine laws, particularly, Articles 191 to 193 of the Labor Code, as amended, and the applicable implementing rules and regulations in case of any dispute, claim or grievance.

Thus, the CA was correct in applying the Labor Code provisions in Lobusta’s claim for disability benefits. The Labor Arbiter erred in failing to apply them.

Article 192(c)(1) under Title II, Book IV of the Labor Code, as amended, reads:

ART. 192. Permanent total disability. – x x x

x x x x

(c) The following disabilities shall be deemed total and permanent:

(1) Temporary total disability lasting continuously for more than one hundred twenty days, except as otherwise provided in the Rules;

x x x x

Section 2(b), Rule VII of the Implementing Rules of Title II, Book IV of the Labor Code, as amended, or the Amended Rules on Employees’ Compensation Commission (ECC Rules), reads:

Sec. 2. Disability. – x x x

(b) A disability is total and permanent if as a result of the injury or sickness the employee is unable to perform any gainful occupation for a continuous period exceeding 120 days, except as otherwise provided for in Rule X of these Rules.

x x x x

Section 2, Rule X of the ECC Rules reads:

SEC. 2. Period of entitlement.— (a) The income benefit shall be paid beginning on the first day of such disability. If caused by an injury or sickness it shall not be paid longer than 120 consecutive days except where such injury or sickness still requires medical attendance beyond 120 days but not to exceed 240 days from onset of disability in which case benefit for temporary total disability shall be paid. However, the System may declare the total and permanent status at any time after 120 days of continuous temporary total disability as may be warranted by the degree of actual loss or impairment of physical or mental functions as determined by the System.

x x x x

According to Vergara,³¹ these provisions of the Labor Code, as amended, and implementing rules are to be read hand in hand with the first paragraph of Section 20(B)(3) of the 2000 POEA Standard Employment Contract which reads:

Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness allowance equivalent to his basic wage until he is declared fit to work or the degree of permanent disability has been assessed by the company-designated physician[,] but in no case shall this period exceed one hundred twenty (120) days.

Vergara continues:

As these provisions operate, the seafarer, upon sign-off from his vessel, must report to the company-designated physician within three (3) days from arrival for diagnosis and treatment. For the duration of the treatment but in no case to exceed 120 days, the seaman is on temporary total disability as he is totally unable to work. He receives his basic wage during this period until he is declared fit to work or his temporary disability is acknowledged by the company to be permanent, either partially or totally, as his condition is defined under the POEA Standard Employment Contract and by applicable Philippine laws. If the 120 days initial period is exceeded and no such declaration is made because the seafarer requires further medical attention, then the temporary total disability period may be extended up to a maximum of 240 days, subject to the right of the employer to declare within this period that a permanent partial or total disability already exists. The seaman may of course also be declared fit to work at any time such declaration is justified by his medical condition.

x x x x

As we outlined above, a temporary total disability only becomes permanent when so declared by the company physician within the periods he is allowed to do so, or upon the expiration of the maximum 240-day medical treatment period without a declaration of either fitness to work or the existence of a permanent disability.³²

To be sure, there is one Labor Code concept of permanent total disability, as stated in Article 192(c)(1) of the Labor Code, as amended, and the ECC Rules. We also note that the first paragraph of Section 20(B)(3) of the 2000 POEA Standard Employment Contract was lifted verbatim from the first paragraph of Section 20(B)(3) of the 1996 POEA Standard Employment Contract, to wit:

Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness allowance equivalent to his basic wage until he is declared fit to work or the degree of permanent disability has been assessed by the company-designated physician, but in no case shall this period exceed one hundred twenty (120) days.

Applying the foregoing considerations, we agree with the CA that Lobusta suffered permanent total disability. On this point, the NLRC ruling was not in accord with law and jurisprudence.

Upon repatriation, Lobusta was first examined by the Pulmonologist and Orthopedic Surgeon on May 22, 1998. The maximum 240-day (8-month) medical-treatment period expired, but no declaration was made that Lobusta is fit to work. Nor was there a declaration of the existence of Lobusta’s permanent disability. On February 16, 1999, Lobusta was still prescribed medications for his lumbosacral pain and was advised to return for reevaluation. May 22, 1998 to February 16, 1999 is 264 days or 6 days short of 9 months.

On Lobusta’s other ailment, Dr. Roa’s clinical summary also shows that as of December 16, 1999, Lobusta was still unfit to resume his normal work as a seaman due to the persistence of his symptoms. But neither did Dr. Roa declare the existence of Lobusta’s permanent disability. Again, the maximum 240-day medical treatment period had already expired. May 22, 1998 to December 16, 1999 is 19 months or 570 days. In Remigio, unfitness to work for 11-13 months was considered permanent total disability. So it must be in this case. And Dr. David’s much later report that Lobusta “ought not to be considered fit to return to work as an Able Seaman” validates that his disability is permanent and total as provided under the POEA Standard Employment Contract and the Labor Code, as amended.

In fact, the CA has found that Lobusta was not able to work again as a seaman and that his disability is permanent “as he has been unable to work since 14 May 1998 to the present or for more than 120 days.” This period is more than eight years, counted until the CA decided the case in August 2006. On the CA ruling that Lobusta’s disability is permanent since he was unable to work “for more than 120 days,” we have clarified in Vergara that this “temporary total disability period may be extended up to a maximum of 240 days.”

Thus, we affirm the award to Lobusta of US$60,000 as permanent total disability benefits, the maximum award under Section 30 and 30-A of the 1996 POEA Standard Employment Contract. We also affirm the award of US$2,060 as sickness allowance which is not contested and appears to have been accepted by the parties.

On the matter of attorney’s fees, under Article 2208³³ of the Civil Code, attorney’s fees can be recovered in actions for recovery of wages of laborers and actions for indemnity under employer’s liability laws. Attorney’s fees are also recoverable when the defendant’s act or omission has compelled the plaintiff to incur expenses to protect his interest.³⁴ Such conditions being present here, we affirm the award of attorney’s fees, which we compute as US$3,103 or 5% of US$62,060.

Before we end, we note petitioners’ repeated failure to comply with our resolutions, as well as the orders issued by the tribunals below. We remind petitioners and their counsels that our resolutions requiring them to file pleadings are not to be construed as mere requests, nor should they be complied with partially, inadequately or selectively. Counsels are also reminded that lawyers are called upon to obey court orders and willful disregard thereof will subject the lawyer not only for contempt but to disciplinary sanctions as well.³⁵ We may also dismiss petitioners’ appeal for their failure to comply with any circular, directive or order of the Supreme Court without justifiable cause.³⁶ In fact, we actually denied the instant petition on July 9, 2008 since petitioners failed to file the required reply to the comment filed by Lobusta.³⁷ On reconsideration, however, we reinstated the petition.³⁸ But when we required the parties to submit memoranda, petitioners again did not comply.³⁹ As regards the proceedings below, they did not file their position paper on time, despite the extensions granted by the Labor Arbiter.⁴⁰ Nor did they file the comment and memorandum required by the CA.⁴¹

Finally, we note that the Labor Arbiter improperly included Miguel Magsaysay as respondent in his decision.⁴² It should be noted that Lobusta sued Magsaysay Maritime Corporation and/or Wastfel-Larsen Management A/S in his complaint.⁴³ He also named them as the respondents in his position paper.⁴⁴ Petitioners are the proper parties.

WHEREFORE, we DENY the present petition for review on certiorari and AFFIRM the Decision dated August 18, 2006 of the Court of Appeals and its Resolution dated April 19, 2007 in CA-G.R. SP No. 74035. We ORDER petitioners Magsaysay Maritime Corporation and/or Wastfel-Larsen Management A/S to pay respondent Oberto S. Lobusta US$65,163 as total award, to be paid in Philippine pesos at the exchange rate prevailing during the time of payment.

With costs against the petitioners.

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.

• ·Also referred to as Westfal-Larsen Management A/S.

*Designated additional member per Raffle dated February 10, 2010 vice Associate Justice Lucas P. Bersamin who recused himself from the case due to prior action in the Court of Appeals.

1Rollo, pp. 34-44. Penned by Associate Justice Santiago Javier Ranada with the concurrence of Associate Justices Portia Aliño-Hormachuelos and Amelita G. Tolentino.

2Id. at 46-47. Penned by Associate Justice Portia Aliño-Hormachuelos with the concurrence of Associate Justices Lucas P. Bersamin (now a Member of this Court) and Amelita G. Tolentino.

3Id. at 11.

4Records, p. 50.

5Id. at 3.

6Rollo, p. 49.

7Id. at 34-35, 73.

8Id. at 74.

9Id. at 81.

10Id. at 83.

11Id. at 84-85.

12Electromyography/Nerve Conduction Velocity.

13Rollo, p. 91.

14Id. at 92.

15Id. at 53.

16Id. at 95.

17Records, p. 2.

18Rollo, pp. 101-103.

19Id. at 103.

20Id. at 43-57.

21Id. at 51-56.

22Id. at 334-336.

23Rollo, p. 43.

24Id. at 18.

25G.R. No. 152273, September 11, 2007, 532 SCRA 585, 592.

26G.R. No. 159887, April 12, 2006, 487 SCRA 190.

27Reorganizing the Philippine Overseas Employment Administration and for Other Purposes.

28Supra note 26 at 207.

29Id. at 207-208, 212.

30G.R. No. 172933, October 6, 2008, 567 SCRA 610, 626.

31Id. at 627.

32Id. at 628-629.

33ART. 2208. In the absence of stipulation, attorney’s fees and expenses of litigation, other than judicial costs, cannot be recovered except:

x x x x

(7) In actions for the recovery of wages of x x x laborers x x x;

(8) In actions for indemnity under workmen’s compensation and employer’s liability laws;

x x x x

34Remigio v. National Labor Relations Commission, supra note 26 at 215.

35Sebastian v. Bajar, A.C. No. 3731, September 7, 2007, 532 SCRA 435, 449.

36Rules of Court, Rule 56, Section 5. Grounds for dismissal of appeal. – x x x

x x x x

(e) Failure to comply with any circular, directive or order of the Supreme Court without justifiable cause.

x x x x

37Rollo, p. 300.

38Id. at 319.

39Id. at 337.

40Records, p. 48.

41CA rollo, pp. 182, 183-245.

42Records, p. 43.

43Id. at 2.

44Id. at 18.

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)

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

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.

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

Republic of thePhilippines

Supreme Court

Manila

FIRST DIVISION

x—————————————————————————————–x

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:

xxx

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.