G.R. No. 103797. August 30, 2000
PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT, PETITIONER, VS. THE HONORABLE SANDIGANBAYAN (THIRD DIVISION), AEROCOM INVESTORS AND MANAGERS, INC., POLYGON INVESTORS AND MANAGERS, I…
YNARES-SANTIAGO, J.:
Preliminary Mandatory Injunction, on the ground of grave abuse of
discretion amounting to excess of jurisdiction caused by the
Sandiganbayan’s issuance of three Resolutions dated December 10, 1991,
January 27, 1992 and January 29, 1992, in Civil Case No. 0114, entitled “Philippine
Communications Satellite Corporation (PHILCOMSAT) and Philippine
Overseas Telecommunications Corporation (POTC), Plaintiffs versus
Presidential Commission on Good Government (PCGG), Defendant.”
The Presidential Commission on Good Government (PCGG), in a letter-order
dated March 14, 1986, sequestered the shares of stock in POTC and
PHILCOMSAT owned by Jose L. Africa and Roberto S. Benedicto, two of
several known close associates of then President Marcos. The
letter-order requested Carlos M. Farrales, of New Manila, Quezon City,
to do the following:
(S)equester and immediately take over the following establishments,
as well as all assets, funds, and records thereof, to wit:1. PHILIPPINE OVERSEAS COMMUNICATION, INC. (PHILCOMSAT/POTC)
including SUBMARINE CABLE NETWORK at Currimao, Ilocos Norte and the
PHILIPPINE EARTH STATION at Pinugay, Tanay;2. EASTERN TELECOMMUNICATIONS, INCORPORATED including TROPOSCATTER
SYSTEM at Sto. Tomas, Baguio and MICROWAVE SYSTEM at San Fernando,
Pampanga;3. PHILIPPINE LONG DISTANCE TELEPHONE COMPANY;
4. DOMESTIC SATELLITE at the Domsat Station;
and all other subsidiary organizations emanating therefrom.
In this connection, you are hereby named Officer-in-Charge of all the
above-named companies. As such, you are requested to immediately freeze
all the withdrawals, transfers, and/or remittances from the funds of
the above-enumerated companies under any type of deposit accounts, trust
accounts or placements, with the exception of those which are necessary
for maintaining the ordinary course of business.[1]
Accordingly, writs of sequestration were issued by the PCGG over POTC
and PHILCOMSAT. On March 29, 1991, POTC and PHILCOMSAT filed before the
Sandiganbayan Civil Case No. 0114, for certiorari and
injunction, seeking to nullify the writs of sequestration and to enjoin
PCGG and its officers, agents and nominees from interfering with the
management and operation of said corporations. Plaintiffs hinged their
petition on the argument that since the PCGG had failed to institute the
corresponding judicial action required under Article XVIII, Section 26,
second paragraph of the 1987 Philippine Constitution,[2] the assailed writs of sequestration issued against them had long ceased to be effective.
The PCGG opposed the petition, arguing that the sequestration was in
full force and effect, belying the plaintiff-corporations’ contention
that the PCGG had failed to file the mandated judicial action. On the
contrary, the PCGG alleged, there was pending before the Sandiganbayan
Civil Case No. 0009, filed on July 22, 1987 – well within the period
allowed by the cited constitutional provision. One of the named
defendants therein was Jose L. Africa, allegedly a stockholder with
controlling interest in POTC and PHILCOMSAT. The
plaintiff-corporations, however, were not named party-defendants in
Civil Case No. 0009. Nevertheless, the PCGG contended that the filing
of the case against Jose L. Africa, despite the fact that the
plaintiff-corporations were not impleaded as party-defendants, satisfied
the Constitutional provision requiring judicial action against these
sequestered corporations.
On August 8, 1991, POTC and PHILCOMSAT filed a motion for summary
judgment, submitting for resolution the sole issue of whether or not
Civil Case No. 0009 pending before the Sandiganbayan is the judicial
action contemplated and required under Section 26, Article XVIII of the
1987 Constitution, considering that said corporations were not impleaded
as defendants in the said case.
The Sandiganbayan found for the plaintiffs POTC and PHILCOMSAT, ruling
that the PCGG failed to institute any judicial action directly against
the plaintiff-corporations. While Jose L. Africa was a stockholder of
said corporations, the latter have a legal personality distinct and
separate from their stockholders. Thus, a suit against any of their
stockholders is not ipso facto a suit against the corporations
themselves.
Consequently, the Sandiganbayan issued a Resolution in Civil Case No.
0114, promulgated on December 4, 1991, disposing as follows:
The writs of sequestration over the herein plaintiff-corporations were
issued on March 14, 1986 and April 11, 1986, or before the ratification
of the Constitution on February 2, 1987. The record does not show,
however, that a judicial action has been filed against the
plaintiff-corporations from the date of their sequestration up to August
2, 1987 or six months after the ratification of the Constitution. On
the other hand, what appears in the record is the Certification of the
Acting Clerk of Court of this Court, Atty. Luisabel Alfonso-Cortez, that
no case has been filed against the plaintiff-corporations as of August
5, 1991 (Annex “A”, Motion). (Underscoring ours)
It is our view, therefore, and We so hold that for the failure of
defendant PCGG to file the corresponding judicial action against
plaintiff-corporations, PHILCOMSAT and POTC, within the period mandated
in Section 26 of Article XVIII of the 1987 Constitution, the writs of
sequestration issued against them are deemed automatically lifted.
WHEREFORE, the Motion for Summary Judgment is hereby granted. As prayed for, summary judgment is hereby rendered as follows:
1) The sequestration of herein plaintiff-corporations, Philcomsat and POTC, is hereby declared lifted;
2) Defendant PCGG, its Commissioners, other officers, employees,
agents, representatives, nominees and designees, are hereby ENJOINED
from preventing disbursements by the plaintiff-corporations, and from
doing any other act that would in any way interfere with, hinder or
hamper the management and operation of plaintiff-corporations; and3) Declaring as null and void all acts of sequestration against plaintiff-corporations as of August 2, 1987.
Without pronouncement as to costs.[3]
In the meantime, prior to the above-quoted Resolution of the
Sandiganbayan, an “Urgent Motion to Intervene” in Civil Case No. 0114
and another “Urgent Motion to Permit Intervenors to Receive their
Dividends from the POTC,” both dated October 30, 1991, were filed by
Aerocom Investors and Managers, Inc. (AEROCOM) and Polygon Investors and
Managers, Inc. (POLYGON). Intervenors AEROCOM and POLYGON alleged in
their twin motions that they are the registered owners of 1,668 and 963
unencumbered shares of stock in POTC, respectively; that the POTC had
declared the distribution of cash dividends of P7,700.00 per share on
June 14, 1988 and P14,970.00 per share on October 1, 1989; and that the
PCGG refused to countersign the checks issued by POTC covering the
dividends in favor of AEROCOM and POLYGON. The intervenors further
alleged that this belated objection of the PCGG is patently oppressive,
moreso after considering that: (1) the PCGG allowed the intervenors to
receive their dividends in the previous years, particularly those
distributed on March 4, June 3 and October 9, 1986, as well as on
December 3, 1987; and (2) the PCGG had left to the discretion of the
Sandiganbayan the matter of payment of the 1989 dividends.
The PCGG opposed the intervenors’ Motions stressing that the same should
have been filed in Civil Case No. 009 and not in Civil Case No. 0114
since the issues raised in the said motions are the same as those
involved in Civil Case No. 009.
On December 10, 1991, the Sandiganbayan issued the first assailed
Resolution granting both motions of the intervenors, for the following
reasons:
(1) AEROCOM and POLYGON have an interest in the matter under
litigation in Civil Case No. 0114, or in the success of either parties,
being the registered owners of 1,668 and 963 shares of stock,
respectively, in POTC;(2) The writ of sequestration over POTC had already been previously
lifted in the Resolution promulgated on December 4, 1991;(3) The Motion for Intervention was seasonably filed before the
Sandiganbayan rendered judgment in Civil Case No. 0114 by way of the
Resolution aforementioned;(4) The intervenors’ shares of stock in POTC were never
sequestered, thus they have a right to be paid their respective
dividends for the years 1988 and 1989; and the PCGG has no authority to
withhold the release thereof; and(5) Further delay would unduly deprive the intervenors AEROCOM and
POLYGON of the dividends they are legally entitled to, and the PCGG’s
stubborn refusal to have the funds released by the depository bank is
unreasonably discriminating against the intervenors.
Consequently, the Sandiganbayan disposed, to wit:
WHEREFORE, premises considered, the “Urgent Motion to
Intervene” and “Urgent Motion to Permit Intervenors to Receive their
Dividends from the Philippine Overseas Telecommunications Corporation”
filed by Aerocom Investors and Managers, Inc. and Polygon Investors and
Managers, Inc. are hereby GRANTED.
Accordingly, this Court hereby directs the immediate payment to
intervenors Aerocom and Polygon of their dividends from the Philippine
Overseas Telecommunications Corporation on their 1,668 and 963 POTC
shares, respectively. Said payment would cover dividends for the years
1988 and 1989 in the amount of P7,700 and P14,970 per share,
respectively, together with the interests due thereon from their due
dates up to the dates of actual payment. For this purpose, the
Presidential Commission on Good Government (PCGG), its representatives
or agents is hereby mandated to immediately lift any restriction on the
issuance, release and/or payment to herein movants-intervenors of any
and all checks, vouchers, and the like appertaining to the aforesaid
cash dividends. Furthermore, PCGG is ordered to report to this Court in
writing, compliance with the foregoing directive, within fifteen (15)
days from receipt hereof.
SO ORDERED.[4]
The PCGG filed a Motion for Reconsideration arguing that the filing of
Civil Case No. 0009 seeking, among others, to recover the ill-gotten
wealth of the beneficial owners of POTC, AEROCOM and POLYGON was, in
effect, faithful compliance with the pertinent constitutional
requirement. Although the said corporations were not impleaded as
defendants therein, the Sandiganbayan should have allowed the PCGG to
pierce the veil of corporate fiction of these corporations and to
present evidence to prove that these dummy corporations were
machinations by which the named defendants in Civil Case No. 0009, such
as Jose L. Africa, acquired their ill-gotten wealth. Furthermore, the
PCGG contended that the matter of who is rightfully entitled to the
dividends declared by these corporations can only be resolved together
with the issues pending before the Sandiganbayan in Civil Case No. 0009.
Accordingly, the PCGG had the authority to withhold the release of the
disputed dividends until final resolution of Civil Case No. 0009.
For their part, intervenors AEROCOM and POLYGON filed an Ex-Parte Motion
for Clarification asking the Sandiganbayan to reaffirm the immediate
effectivity of the Resolution dated December 10, 1991 and also to direct
the Traders Royal Bank to honor and pay immediately the amounts stated
in Check Nos. 382450 and 382451 without need of PCGG approval. The
intervenors also moved to strike out PCGG’s Motion for Reconsideration
on the ground that it was filed out of time and, therefore, was merely
pro forma and dilatory.
On January 27, 1992, the Sandiganbayan issued the second assailed
Resolution denying both the PCGG’s Motion for Reconsideration and the
intervenors’ clarificatory motion. The Sandiganbayan reaffirmed its
earlier Resolution dated December 10, 1991, to wit:
At the outset, it bears repeating that the arguments presented by
defendant PCGG in support of the subject motion have all been squarely
met and disposed of by this Court in Our previous Resolutions. PCGG
adamantly insists that the filing of Civil Case No. 0009 which is
purportedly a suit against the so-called beneficial owners of POTC,
Aerocom, and Polygon, is compliance with Sec. 26, Art. XVIII of the 1987
Constitution, thereby maintaining the efficacy of the writ of
sequestration it issued against POTC. We cannot sustain such a view.
These corporations, to wit: POTC, Aerocom and Polygon were never
impleaded in such civil case. The fact that defendant PCGG raises the
argument that the beneficial owners of these corporations were impleaded
as parties-defendants in said case could only be interpreted as a tacit
admission of its patent failure to file the corresponding judicial
action against them pursuant to the constitutional mandate. As such,
the writ of sequestration it issued over POTC should be deemed to have
been automatically lifted. Moreover, to paraphrase the words of the
Supreme Court in Republic of the Philippines vs. Sandiganbayan, et al.
(August 12, 1991, G.R. No. 92376), whether or not the impleaded
defendants in Civil Case No. 0009 are indeed the beneficial owners of
POTC, Aerocom, and Polygon is a matter which defendant PCGG merely
assumes and still has to prove in said case. All told, defendant PCGG
fails to convince Us that the automatic lifting of the writ of
sequestration over POTC is not founded on solid factual and legal
grounds.
With respect to the propriety of applying the doctrine of piercing the
veil of corporate identity, We reiterate Our earlier holding that the
application of said principle would only come into play once the Court
has already acquired jurisdiction over the corporation. Since this
Court has not acquired jurisdiction over POTC in Civil Case No. 0009,
precisely because it was not impleaded therein as a party defendant,
said contention cannot be upheld.
Finally, defendant PCGG alleges that the motion filed by intervenors
Aerocom and Polygon should have been treated as an incident in Civil
Case No. 0009. We do not think so. By reason of the fact that POTC is
not even a party in Civil Case No. 0009, herein intervenors do not have
any interest in the subject matter of litigation therein as required by
Sec. 2, Rule 12 of the Revised Rules of Court. Contrast this with the
situation in the present case wherein intervenors Aerocom and Polygon
are shareholders of plaintiff POTC and as such, have sufficient interest
to intervene, as in fact said intervention has been allowed by this
Court in the Resolution sought to be reconsidered. Suffice it to state
that the propriety of Aerocom and Polygon’s intervention in the
above-entitled case has not been successfully challenged.
WHEREFORE, for the aforestated reasons, the “Urgent Motion (a) to strike
out Motion for Reconsideration for being filed out of time; pro-forma
and purely dilatory of frivolous, (b) for Immediate Execution of the
December 10, 1991 Resolution” filed by intervenors Aerocom Investors and
Managers, Inc. and Polygon Investors and Managers, Inc. is hereby
DENIED for lack of merit.
On the other hand, the “Motion for Reconsideration” filed by defendant
Presidential Commission on Good Government (PCGG) is likewise hereby
DENIED for lack of merit. Accordingly, the Resolution of this Court
dated December 10, 1991 is affirmed.
SO ORDERED.[5]
On January 29, 1992, the Sandiganbayan issued the third assailed Resolution, to wit:
Acting on the “Ex-Parte Motion for Clarification” filed by intervenors
Aerocom Managers and Investors, Inc. and Polygon Managers and Investors,
Inc. on December 16, 1991 and considering our Resolutions of December
10, 1991 and January 27, 1992, We find the same to be impressed with
merit. Accordingly, Traders Royal Bank is hereby directed to
immediately honor and pay Check Nos. 382450 and 382451 issued by
Philippine Overseas Telecommunications Corporation (POTC) in favor of
Aerocom Managers and Investors, Inc. and Polygon Managers and Investors,
Inc., representing dividend payments to the latter for the years 1988
and 1989, as previously indicated in the aforementioned Resolution of
December 10, 1991.
SO ORDERED.[6]
Hence, the instant petition for ifiled by the PCGG assailing the three
(3) Sandiganbayan Resolutions, ascribing to the said court grave abuse
of discretion amounting to lack or excess of jurisdiction in issuing the
same, contending that these Resolutions are not only conflicting, but
also without basis. The PCGG further stressed that the implementation
of these Resolutions will dissipate beyond retrieval ill-gotten wealth
which the State, through the PCGG, has been trying to recover from the
Marcos family, their cronies, dummies, relatives and other nominees. In
this particular instance, the amount involved is not a measly sum as
the State stands to lose a total of P59,644,770.00.
On the first Resolution dated December 10, 1991, the PCGG claims that
the same was issued with grave abuse of discretion because the
Sandiganbayan granted the Motion to Intervene as well as the relief
sought by the intervenors even before they could file their
complaint-in-intervention, thus depriving the PCGG opportunity to file
its answer thereto.
We do not agree. The intervenors’ “Urgent Motion to Intervene” was not
for the purpose of filing a complaint against any of the principal
parties in Civil Case No. 0114, but only to ask the Sandiganbayan for
leave to file the “Urgent Motion to Permit the Intervenors to Receive
their Dividends from POTC,” while the main case was pending. By the
time the Sandiganbayan resolved the intervenors’ Motions, it had already
rendered judgment declaring the writ of sequestration lifted and of no
effect. Thus, there was no more obstacle to the intervenors’ receipt of
the dividends from POTC. Intervenors AEROCOM and POLYGON had no cause
or intention to file a complaint-in-intervention so there was no need or
reason for the PCGG to answer.
Be that as it may, the PCGG was not totally deprived of the opportunity
to oppose the intevenors’ Motions. The records reveal that the Motions
were filed on October 30, 1991 and a hearing thereof was held on
November 4, 1991. The PCGG failed to appear at the scheduled hearing,
prompting a certain Atty. Gregorio Ejercito, Jr. to enter a special
appearance and to request that the PCGG be given five (5) days within
which to file its opposition to the intervenors’ Motions. Accordingly,
the Sandiganbayan issued an Order granting the PCGG five (5) days, or
until November 9, 1991 to file its opposition.[7]
And yet, it took the PCGG eighteen (18) more days after the lapse of
the five-day period granted by the Sandiganbayan to file a motion for
leave to admit its opposition to the intervenors’ Motions.[8]
If the PCGG now feels that it was denied its day in court, it has only
itself to blame. Not only did the PCGG fail to appear during the
scheduled hearing, but its opposition to the intervenors’ Motions was
also filed way beyond the period given by the Sandiganbayan. Be that as
it may, the Sandiganbayan was lenient enough to admit the belated
opposition.
Contrary to what the PCGG would like this Court to believe, the PCGG was
given ample time and opportunity to oppose the intervenors’ Motions.
Thus, the Sandiganbayan issued the first assailed Resolution on December
10, 1991 granting both Motions, only after both parties have been
heard, hence, no grave abuse of discretion amounting to lack or excess
of jurisdiction was committed by the Sandiganbayan.[9]
The second assailed Resolution dated January 27, 1992, denied the PCGG’s
Motion for Reconsideration of the Resolution dated December 10, 1991.
We find the denial of the PCGG’s Motion for Reconsideration proper and
well-supported by the facts. The only issue raised in the Motions filed
by the intervenors was whether or not AEROCOM and POLYGON are entitled
to the dividends declared for distribution by the POTC. A review of the
pleadings as well as the documentary evidence would readily show that,
indeed, the intervenors are entitled thereto.
There is no doubt that AEROCOM and POLYGON are registered owners of
shares of stock of POTC and as such, they received the dividends
declared in 1986 and 1987 without objection from the PCGG. The records
also reveal that they have never been sequestered nor have there been
any case filed against them by the PCGG. POTC was not impleaded as a
party-defendant in Civil Case No. 0009 and the writ of sequestration
over the said corporation had long been lifted by the Sandiganbayan.
There is nothing, therefore, that disqualifies or prevents the
intervenors from receiving the questioned dividends.
In fact, the PCGG subsequently did not raise any objection to the
distribution of dividends in the succeeding years. In a letter
dated January 16, 1992 addressed to the POTC, the then PCGG Chairman,
David Castro, wrote:
“As it was in the case of dividend payments out of the dividend
declaration of September 28, 1989, we are leaving to the discretion of
the Court (Sandiganbayan) the matter of the release of dividend checks
for cash dividends declared last November 15, 1991.”[10] (Underscoring ours)
Such being the case, there is no reason for the PCGG now to oppose the
release of the 1988 and 1989 declared dividends to the
intervenor-corporations. The PCGG’s selective opposition is not only
discriminatory because all the other stockholders have received their
dividends, but it is also oppressive because, after all, the PCGG had
already submitted to the discretion of the Sandiganbayan the release of
the dividend checks. Clearly, the issue of the questioned dividends has
become moot and academic and the PCGG is estopped from asserting the
authority to withhold the release of dividends to POTC stockholders, the
intervenors included.
Finally, on the third assailed Resolution dated January 29, 1992, this
Court finds no error in the Sandiganbayan’s directive to the Trader’s
Royal Bank to immediately honor and pay Check Nos. 382450 and 382451
issued by the POTC in favor of the intervenor-corporations.
The records show that since the promulgation of the said Resolution on
December 10, 1991, fifty (50) days had elapsed before the Sandiganbayan
implemented said Resolution and it was only on January 30, 1992 when the
intervenor-corporations deposited the said checks. Hence, there was no
grave abuse of discretion on the part of the Sandiganbayan when it
issued the third assailed Resolution directing the Traders Royal Bank to
honor and pay the subject dividend checks in favor of the
intervenor-corporations.
WHEREFORE, in view of all the foregoing, the instant petition is hereby DISMISSED for lack of merit.
No pronouncement as to costs.
SO ORDERED.
Davide, Jr., C.J., Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza, Quisumbing, Purisima, Pardo, Buena, and Gonzaga-Reyes, JJ., concur.
Panganiban, J., no part being a former counsel of a party.
De Leon, Jr., J., no part.
[1] Rollo, p. 69.
[2] A sequestration
or freeze order shall be issued only upon showing of a prima facie
case. The order and the list of the sequestration or frozen properties
shall forthwith be registered with the proper court. For orders issued
before the ratification of this Constitution, the corresponding judicial
action or proceedings shall be filed within six months from its
ratification. For those issued after such ratification, the judicial
action or proceeding shall be commenced within six months from the
issuance thereof.
[3] Rollo, pp. 66-68;
Associate Justice Sabino R. de Leon, Jr., ponente; Associate Justices
Conrado M. Molina and Augusto M. Amores, concurring.
[4] Rollo, pp. 20-21; Justice Augusto M. Amores, ponente; Justices Conrado M. Molina and Sabino R. de Leon, Jr., concurring.
[5] Rollo, pp. 26-28.
[6] Rollo, p. 29.
[7] Order dated November 4, 1991; Records, p. 190.
[8] PCGG’s Opposition to Motion for Intervention; Records, p. 205.
[9] Cuision v. CA, 289 SCRA 159 (1998); Esguerra v. CA, 267 SCRA 380 (1997).
[10] Rollo, p. 54.