**Facts:**
1. **Background on Entities involved:** The Social Security System (SSS), a government insurance program, lodged a complaint against members of the Board of Directors of JMA Transport Services Corporation, namely Manuel F. Seno, Jr., Fernando S. Gorrospe, and Gemma S. Seno. JMA Transport was a duly covered member of the SSS.
2. **Initial Dispute (2000):** SSS discovered JMA Transport’s delinquency in remitting social security contributions from September 1997 to July 1999, amounting to PHP 838,488.13. SSS issued a demand for payment; however, non-compliance led SSS to file a complaint before the Muntinlupa City Prosecutor’s Office, alleging violations of the Social Security Act of 1997.
3. **Settlement Attempt:** In the preliminary investigation, Manuel Seno proposed to pay the delinquent contributions via installment and issued 24 postdated checks totaling PHP 609,370.50. SSS provisionally withdrew its complaint in light of this attempt.
4. **Renewed Dispute (2004):** Two checks were dishonored post-settlement, prompting SSS to refile complaints citing further unpaid obligations totaling PHP 4,903,267.52, including subsequent contributions and penalties until June 2004.
5. **Defense Arguments:** Manuel contended JMA ceased operations in July 1999, clearing them of responsibility for further contributions. The remaining claims stemmed from bank-merger-related check issues, not deliberate negligence. Fernando and Gemma further distanced themselves, indicating non-involvement in operational contribution matters.
6. **Prosecutor’s Decision:** The Office of the City Prosecutor, despite respondents’ claims, found probable cause, leading to the case’s filing (Criminal Case No. 05-853).
7. **Appeal to DOJ:** Respondents sought Justice Department intervention. In January 2006, the DOJ sided with respondents, citing operational closure and fulfilled settlement agreements. The Criminal Information withdrawal was directed but challenged by SSS without positive outcome.
8. **Trial Court Proceedings:** Following the DOJ directive, the prosecutor sought to withdraw information, denied initially by the RTC based on transport business records. The case was ordered under reinvestigation post-respondents’ motion highlighting documentary discrepancies and emphasizing their unproven board-level involvement in contribution infractions.
9. **Appeal to Court of Appeals:** Respondents pursued a certiorari petition, arguing procedural and evidential defects in the RTC’s handling.
**Issues:**
1. **Judicial Overreach:** Did the trial court exceed its discretionary boundaries by denying the withdrawal of information and ordering a reinvestigation assaulting respondents’ procedural rights?
2. **Admissibility and Fully Participation:** Were the trial court’s decisions regarding Franchise Verification documents correct, without prior opposing party elucidation?
3. **Operational Status Evidence Impact:** Is the Franchise Verification sufficient to assume continuous operational status of JMA Transport, refuting cessation claims post-1999?
4. **Due Process Violations:** Whether judicial actions circumvented due process in providing relief not explicitly petitioned for, specifically the unsolicited reinvestigation in light of procedural objections.
**Court’s Decision:**
1. **Error of Lower Court (RTC May Order):** The Supreme Court held the RTC did not err in denying motion for information withdrawal, as existing evidence (Franchise Verifications) substantially validated the inference of corporate operation post-1999. Judicial discretion standard from Crespo v. Mogul mandates courts determine the merit of case withdrawals post-filing based on independent record assessment.
2. **Error of Lower Court (RTC September Order):** Conversely, erroneous reinvestigation direction, not subject to cross-examination or mutual party consents contravened judicial norms. Courts cannot award unrequested relief, reflecting overreach infringing SSS’s due process rights, as appellate scrutiny underscored.
**Doctrine:**
1. **Judicial Discretion Post-Filing:** Once judicial proceedings commence, courts possess ultimate discretion regarding complaint or information dispositions, independent of prosecutorial stances.
2. **Prospective Relief Limitation:** Judicial mandates on reinvestigation lacking contingency on mutual party solicitations infringe due process, misdirecting the adjudicative course.
**Class Notes:**
– **Key Doctrine:** Crespo v. Mogul; judicial discretion in criminal case continuance/remittance post-procedural filing.
– **Statutory References:** Republic Act No. 1161 (Social Security Act of 1997), emphasis on duty compliance and penalties (Sections 22 and 28).
– **Procedural Reliance:** Investigatory and judicial evidence must align to prosecute post-filing unless palpable procedural rights are prejudiced by disconnected reinvestigations.
**Historical Background:**
– **Philippine Social Security Framework:** Emergent from systemic underreporting of labor benefits, the SSS mandates provide a binding coverage umbrella across enterprise hierarchies, rendering board-level liability a facet of contributory oversight, amid the rising operational complexities post-financial sector consolidations in the early millennium Philippine industry landscape.
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