ANG FANG AND ANG KIM TIAO PETITIONERS, VS. PEOPLE OF THE PHILIPPINES, RESPONDENT.

Ang Fang and Ang Kim Tiao versus People of the Philippines

The Case

This is a criminal case in which the People of the Philippines prosecuted two men, Ang Fang and Ang Kim Tiao, for two offenses arising from a single shipment: fraudulent practice against customs revenues, which is smuggling under Section 2703 of the Revised Administrative Code, and the illegal importation of a prohibited drug, opium, under Article 192 of the Revised Penal Code. The case matters to a Bar candidate because it is a compact lesson on two things: how the Supreme Court treats the burden of proof in smuggling when the accused disclaim knowledge of the contraband hidden inside a lawful shipment, and how the Indeterminate Sentence Law is applied when the special law violated fixes a range of penalties.

Procedural History

Two criminal cases were filed against the petitioners before the Court of First Instance of Manila. After trial, the Manila court found both petitioners guilty on both counts. For smuggling, each was sentenced to an indeterminate penalty with a minimum of not less than one year of imprisonment, with no maximum provided, and to pay a fine of two thousand pesos, with subsidiary imprisonment in case of insolvency. For the illegal importation of opium, each was sentenced to an indeterminate penalty ranging from a minimum of one year and one day to a maximum of three years, six months and twenty-one days of prision correccional, and to pay a fine of two thousand pesos, with subsidiary imprisonment in case of insolvency.

The petitioners appealed to the Court of Appeals. That court affirmed the convictions, except that in the smuggling case it imposed an indeterminate prison term consisting of a minimum of not less than six months and a maximum of not more than two years, with costs. The petitioners then brought the cases to the Supreme Court by petition for review on certiorari, and the Supreme Court decided the consolidated cases in October 1966.

Facts

Sometime in March 1955, the petitioner Ang Fang, a merchant with an annual allocation of one thousand dollars, opened a letter of credit with the China Banking Corporation for one hundred dollars, to be used for the importation of joss papers from Hongkong. A bill of lading covering joss papers contained in four bales was sent to him by the shipper, Bee Chiong Hong of Hongkong. On March 16, 1955, a shipment of four bales supposedly consisting of joss papers, bearing the identification mark BTC and consigned to Ang Fang, was unloaded at the Port of Manila from a steamer that came from Hongkong, and was placed under customs custody.

Ang Kim Tiao, acting for the consignee Ang Fang, submitted to the Bureau of Customs the documents needed for the release of the shipment. These included the permit to deliver the imported goods, the importer's declaration for advance payment of sales tax, the official receipt of the cash deposit for estimated taxes, the release certificate from the Central Bank through the China Banking Corporation as agent, the bill of lading, the commercial invoices, and the Customs Consumption Entry. None of these papers declared the goods later found; only joss papers in four packages were mentioned. Because there had been reports of illegal importation of dutiable merchandise, the shipment was subjected to a rigid inspection at the Parcel Section rather than at the pier.

When the four bales were opened by a committee of customs officials in the presence of other persons, two of the bales, numbers three and four, were found to have holes in the center, half a foot square and about one foot deep. In bale number three were twenty-two packages containing men's and ladies' watches of different makes, together with gold-filled watch crowns and gold-filled and stainless steel bracelets. In bale number four were one hundred seventy tins of opium of the Dog Brand. The National Bureau of Investigation's chemist examined tins selected at random and found the contents to be opium. Ang Kim Tiao gave a written statement in which he admitted that the negotiable bill of lading was among the papers he signed and submitted, and that he was a cousin of Ang Fang. He testified that he pressed for the release of the goods but was told by the Chief Appraiser that they would not be released, that he informed Ang Fang, and that Ang Fang did nothing. Ang Fang claimed he did not order the goods. Neither petitioner appeared at the scheduled examination despite being notified.

Issues

• Whether or not the prosecution discharged its burden of proving beyond reasonable doubt that the petitioners were the ones who caused the contraband watches and opium to be shipped and concealed in the bales consigned to them.
• Whether or not the penalty imposed for the violation of Section 2703 of the Revised Administrative Code was correctly fixed under the Indeterminate Sentence Law.

Applicable Provisions

Section 2703 of the Revised Administrative Code, the smuggling provision, is the special law under which the first charge was brought, and the Court fixed the penalty for its violation:

The corporal penalty in Section 2703, Revised Administrative Code, is from 6 months to 2 years.

This range is what allowed the Court to set the minimum and maximum of the indeterminate sentence within the limits of the special law.

Article 192 of the Revised Penal Code, on illegal importation of prohibited drugs, is the provision under which the second charge was brought, and the Court found the penalty imposed for its violation to be fair.

Ruling

On the first issue, the Court held that the prosecution had discharged its burden. The facts recited, even without more, supported the conclusion of the Court of Appeals that no one else in the whole world could have ordered the contraband shipped to Manila. The Court reasoned that the innocuous documents prove nothing for the petitioners, because documents would not recite clandestinely imported goods; these are ingeniously concealed with legally imported merchandise on the chance that they escape detection, or that the importer could obtain delivery by improper methods if they are discovered. The Court refused to throw the burden of the illegal shipment on the shipper, since the shipper would not include it unless ordered and paid, or unless a secret understanding existed with the local importer. Nor could the undeclared goods have been planted, given their value. The Court then drew the picture from the record: Ang Fang was the importer and consignee; reports of illegal importation had reached the authorities; Ang Kim Tiao was a longtime employee and cousin of Ang Fang; both were interested in the release; Ang Kim Tiao pressed for immediate release; and when told the bales would undergo rigid inspection, both shied away, did not appear at the scheduled examination despite notice, did not procure delivery of the joss papers, and did not even inquire why release was refused. That pattern of conduct, the Court said, did not comport with their claim of ignorance, and it would be sheer naivete, if not pure infantilism of thought, to accept their pretensions.

On the second issue, the Court held that the penalty for the illegal importation of opium was fair, but that for the smuggling, under the Indeterminate Sentence Act, the minimum of the penalty should be elevated to the level set by the trial court, that is, one year, with a maximum of two years, within the range fixed by the special law.

Doctrine

First, in smuggling and illegal importation, the prosecution's burden is discharged by circumstantial facts that exclude every hypothesis but guilt; the concealment of contraband inside a lawful shipment does not defeat conviction, because documents will not recite clandestinely imported goods, and the shipper will not include them unless ordered and paid or unless a secret understanding exists with the local importer. Second, the unexplained conduct of the consignee and his representative, who press for release but vanish when a rigid inspection is announced and never inquire about the goods, is evidence of guilt, not of innocence. Third, under the Indeterminate Sentence Law, when a special law such as Section 2703 of the Revised Administrative Code fixes a range of penalties, the indeterminate sentence must be set within that range, with the minimum and maximum drawn from it.

Disposition

The judgment under review was modified: for the violation of Section 2703 of the Revised Administrative Code, each petitioner was sentenced to an indeterminate imprisonment of one year to two years and to pay a fine of two thousand pesos, with subsidiary imprisonment; in all other respects the judgment was affirmed, with costs against the petitioners.

Remember This

The line to memorize is that documents will not recite clandestinely imported goods, so concealment inside a lawful shipment does not shift the burden back to the prosecution. Examiners use this case to test circumstantial evidence in smuggling and the application of the Indeterminate Sentence Law to special laws with a fixed range of penalties.