You are on page 1of 10

G.R. No.

171188

June 19, 2009

PEOPLE OF THE PHILIPPINES, Petitioner, vs. JESSIE B. CASTILLO and FELICITO R. MEJIA, Respondents. QUISUMBING, J.: This petition seeks a review of the Resolution1 dated October 10, 2005 of the Sandiganbayan in Criminal Case No. 27789, dismissing the criminal complaint against the respondents, and its Resolution2 dated January 18, 2006 denying petitioners motion for reconsideration. The facts are as follows: Complainant Cesar Sarino is one of the registered owners of a piece of land covered by Transfer Certificate of Title No. T-4502783 of the Registry of Deeds of Cavite, located in front of SM Bacoor, Cavite. The property is leased to Pepito B. Aquino and Adriano G. Samoy who are in turn subleasing it to several stallholders. In September 1999, respondent Felicito R. Mejia, Municipal Building Official of Bacoor, sent to the stallholders Notices of Violation4 of the National Building Code on the grounds that the structures they were occupying were erected without building permits and occupied by them without the necessary certificates of occupancy having been first secured. On January 17, 2000, Mejias office sent letters5 dated January 10, 2000 to the stallholders informing them that because of their repeated failure to comply with the National Building Code and its implementing rules and regulations and the Business Permit and Licensing Office Requirements, their stalls will be closed down on January 24, 2000. On February 16, 2000, a task force from the Bacoor Municipal Hall effected the closure of the stalls through the installation of galvanized iron fences. Lessees Aquino and Samoy thereafter filed before the Office of the Ombudsman a complaint against respondent Jessie B. Castillo, in his capacity as Bacoor Municipal Mayor, respondent Mejia and two other municipal officials for violation of Section 3(e) and (f) of Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act, as amended.6 The case was docketed as OMB-1-00-0537. On October 20, 2000, the Office of the Ombudsman dismissed OMB-1-00-0537, ruling that the respondent local officials acted in good faith in effecting the closure of the stalls.7 On September 6, 2001, Sarino filed a Complaint8 against respondents Castillo and Mejia before the Office of the Ombudsman charging them criminally for violation of Section 3(e) and (f) of Rep. Act No. 3019 and Rep. Act No. 6713,9 and administratively for oppression, grave misconduct and for

committing acts contrary to law. According to Sarino, the construction of the galvanized fence in February 2000 is tantamount to an unlawful taking of their property causing them undue injury and that despite his verbal and written demands, respondents refused to remove said fence. Respondents countered that Sarinos complaint was anchored on the same set of facts that had been the subject of OMB-1-00-0537 that was dismissed by the Ombudsman. On March 10, 2003, the Ombudsman dismissed the administrative complaint for being moot and academic due to Castillos re-election as mayor in the May 2001 elections and pursuant to Section 20 of Rep. Act No. 677010because the act complained of happened more than one year before the complaint was filed.11 On May 7, 2003, the Office of the Ombudsman, through the Office of the Special Prosecutor, filed an Information12 against respondents for violation of Section 3(e) of Rep. Act No. 3019 before the Sandiganbayan. The case was docketed as Criminal Case No. 27789. The Information reads: That in or about February 2000, and for sometime prior or subsequent thereto, in Bacoor, Cavite, Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, JESSIE B. CASTILLO, a high ranking public officer, being the Municipal Mayor, and FELICITO R. MEJIA, the Municipal Building Official, of Bacoor, Cavite, as such taking advantage of their positions and committing the offense in relation to office, conspiring and confederating together, with evident bad faith and manifest partiality, or gross inexcusable negligence, did then and there willfully, unlawfully and criminally cause undue injury to one CESAR SARINO by blocking and fencing off the latters property by installing and erecting a galvanized iron sheet fence on the front portion of the said property facing the SM Bacoor thereby depriving him of the full use and enjoyment of his property, and despite repeated demands from the said land owner, the accused, without valid justification, refuse to remove the said fence to the damage and prejudice of said Cesar Sarino in the amount of Seven Hundred Ninety Thousand and Nine Hundred Twenty Pesos (Php 790,920.00), more or less, representing lost income from the rentals of the stalls and parking fees derived therefrom. CONTRARY TO LAW.13 In a Resolution14 dated August 15, 2003, the Sandiganbayan declared that probable cause exists against respondents for violation of Section 3(e). Accordingly, it directed the issuance of the corresponding warrants of arrest and hold departure orders against respondents. On August 20, 2003, respondents voluntarily surrendered to the Sandiganbayan and posted their respective bonds for their provisional liberty.15 Respondents moved for the reinvestigation of the case which the Sandiganbayan gave due course. After the reinvestigation, the Office of the Special Prosecutor, upon approval of the Ombudsman, filed a Motion for Leave to Admit Attached Amended

Information.16 The respondents then filed a Comment thereon with Motion for Judicial Determination of Probable Cause.17 In a Resolution18 dated November 3, 2004, the Sandiganbayan admitted the Amended Information which reads: That in or about February 2000, and for sometime prior or subsequent thereto, in Bacoor, Cavite, Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, JESSIE B. CASTILLO, a high ranking public officer, being the Municipal Mayor, and FELICITO R. MEJIA, the Municipal Building Official, of Bacoor, Cavite, as such taking advantage of their positions and committing the offense in relation to office, conspiring and confederating together, with evident bad faith and manifest partiality, or gross inexcusable negligence, did then and there wilfully, unlawfully and criminally cause undue injury to CESAR N. SARINO, EVELYN S. MANIQUIS, FLORA JANET S. GARCIA, CLAUDETTE N. SARINO, STEPHEN N. SARINO and PRISCILLA N. SARINO, by blocking and fencing off their property described in Transfer Certificate of Title No. T-450278, which was then being leased by PEPITO B. AQUINO and ADRIANO G. SAMOY for TWELVE THOUSAND PESOS (P12,000.00) a month, by installing and erecting a galvanized iron fence on the front portion of the said property facing the SM Bacoor, thereby depriving them of the full use and enjoyment of their property and effectively decreasing its value for commercial purposes, and despite lawful demand from CESAR N. SARINO, the accused, without valid justification, refuse to remove the said fence to the undue damage and prejudice of said landowners in the amount of SEVEN HUNDRED NINETY THOUSAND and NINE HUNDRED TWENTY PESOS (Php 790,920.00), more or less, representing (1) lost rentals of said property, (2) unpaid compensation for the portion of the property on which the fence was installed, and (3) the decrease in value of the property for commercial purposes. CONTRARY TO LAW.19 In a Resolution20 dated May 9, 2005, the Sandiganbayan denied the respondents Motion for Judicial Determination of Probable Cause. On October 10, 2005, the Sandiganbayan, upon motion for reconsideration filed by respondents, reversed its May 9, 2005 Resolution and dismissed the case. The Sandiganbayan likewise set aside the arrest warrants it previously issued. It held that the instant criminal case is a mere rehash of the previously dismissed criminal case filed by complainants lessees against respondents. It also ruled that there was no evident bad faith, manifest partiality or inexcusable negligence that can be attributed to respondents. Neither did complainants claim of undue injury have any leg to stand on. The Office of the Special Prosecutor filed a motion for reconsideration, but it was denied on January 18, 2006. Hence this petition, with the following issues: I. [WHETHER OR NOT] THE HONORABLE SANDIGANBAYAN GRAVELY ERRED AND DECIDED A QUESTION OF SUBSTANCE IN A MANNER NOT

IN ACCORD WITH LAW AND JURISPRUDENCE IN CONDUCTING A SECOND JUDICIAL DETERMINATION OF PROBABLE CAUSE IN CRIMINAL CASE NO. 27789, LONG AFTER IT ISSUED THE WARRANTS OF ARREST AGAINST THE RESPONDENTS. II. [WHETHER OR NOT] THE HONORABLE SANDIGANBAYAN GRAVELY ERRED AND DECIDED A QUESTION OF SUBSTANCE IN A MANNER NOT IN ACCORD WITH LAW AND JURISPRUDENCE WHEN IT CONSIDERED EVIDENTIARY MATTERS SUPPORTING RESPONDENTS DEFENSE WHEN IT CONDUCTED THE SECOND JUDICIAL DETERMINATION OF PROBABLE CAUSE. III. [WHETHER OR NOT] THE HONORABLE SANDIGANBAYAN GRAVELY ERRED AND DECIDED A QUESTION OF SUBSTANCE IN A MANNER NOT IN ACCORD WITH LAW AND JURISPRUDENCE WHEN IT RULED THAT THE RESPONDENTS ACTED IN GOOD FAITH WHEN IN TRUTH RESPONDENTS HAD NO LEGAL BASIS IN FENCING OFF THE PRIVATE PROPERTY OF THE COMPLAINANT AND HIS SIBLINGS. IV. [WHETHER OR NOT] THE HONORABLE SANDIGANBAYAN GRAVELY ERRED AND DECIDED A QUESTION OF SUBSTANCE IN A MANNER NOT IN ACCORD WITH LAW AND JURISPRUDENCE WHEN IT IGNORED AND DID NOT DISCUSS IN ITS RESOLUTIONS OF OCTOBER 10, 2005 AND JANUARY 18, 2006 THE ISSUE RAISED BY THE PROSECUTION THAT COMPLAINANT AND HIS SIBLINGS SUFFERED UNDUE INJURY BECAUSE, AMONG OTHERS, A PORTION OF THEIR PROPERTY WAS EFFECTIVELY TAKEN BY THE RESPONDENTS WITHOUT JUST COMPENSATION AND THE VALUE OF THE SUBJECT PROPERTY FOR PURPOSES OF COMMERCE WAS GREATLY REDUCED IN VIEW OF THE HIGH GALVANIZED IRON FENCE THAT COVERED AND HID THE PROPERTY FROM THE HIGHWAY AND THE PUBLIC.21 The foregoing issues simply boil down to whether the Sandiganbayan erred in overturning the Ombudsmans determination of probable cause resulting in the dismissal of the case against respondents. Petitioner contends that after the Sandiganbayan issued the arrest warrants against respondents, the responsibility of making a new determination of probable cause shifted back to the Ombudsman as prosecutor when respondents moved for the reinvestigation of the case and such motion was granted by the court. The Ombudsman must then decide whether respondents shall continue to be held for trial in light of any additional evidence presented during reinvestigation. This responsibility, petitioner submits, belongs to the Ombudsman alone and the court is bereft of authority to overturn the formers findings as the judicial determination of probable cause is only for the purpose of determining whether the arrest warrant should be issued. Petitioner further

argues that there are only two instances when the court can intervene in the Ombudsmans action first, when the Ombudsman acted with grave abuse of discretion; and second, when the prosecution makes substantial amendments to the information both of which are wanting in the instant case.1avvphi1 Respondents counter that the amendments made to the information are substantial in nature and not merely formal as they pertain to the inclusion of additional injured parties and specification of the amount of damages. And even assuming the amendments were merely formal, the Sandiganbayan was correct in exercising its judicial prerogative when it determined for itself the existence of probable cause considering the inconsistency of the positions taken by the Ombudsman in OMB-1-00-0537 and the instant case. After seriously considering the submission of the parties, we are in agreement that the petition is meritorious. There are two kinds of determination of probable cause: executive and judicial. The executive determination of probable cause is one made during preliminary investigation. It is a function that properly pertains to the public prosecutor who is given a broad discretion to determine whether probable cause exists and to charge those whom he believes to have committed the crime as defined by law and thus should be held for trial. Otherwise stated, such official has the quasijudicial authority to determine whether or not a criminal case must be filed in court.22Whether or not that function has been correctly discharged by the public prosecutor, i.e., whether or not he has made a correct ascertainment of the existence of probable cause in a case, is a matter that the trial court itself does not and may not be compelled to pass upon.23 The judicial determination of probable cause, on the other hand, is one made by the judge to ascertain whether a warrant of arrest should be issued against the accused. The judge must satisfy himself that based on the evidence submitted, there is necessity for placing the accused under custody in order not to frustrate the ends of justice.24If the judge finds no probable cause, the judge cannot be forced to issue the arrest warrant.25 Corollary to the principle that a judge cannot be compelled to issue a warrant of arrest if he or she deems that there is no probable cause for doing so, the judge in turn should not override the public prosecutors determination of probable cause to hold an accused for trial on the ground that the evidence presented to substantiate the issuance of an arrest warrant was insufficient. It must be stressed that in our criminal justice system, the public prosecutor exercises a wide latitude of discretion in determining whether a criminal case should be filed in court, and that courts must respect the exercise of such discretion when the information filed against the person charged is valid on its face, and that no manifest error or grave abuse of discretion can be imputed to the public prosecutor.26 Thus, absent a finding that an information is invalid on its face or that the prosecutor committed manifest error or grave abuse of discretion, a judges determination of probable cause is limited only to the judicial kind or for the purpose of deciding whether the arrest warrants should be issued against the accused.

In the instant case, there is no question that both the original27 and amended28 Informations were valid on their face because they complied with Section 6,29 Rule 110 of the Rules of Court. Also, a scrutiny of the Resolution30dated August 22, 2002 of the Ombudsman which precipitated the filing of the original Information and the subsequent Memorandum dated August 4, 2004 recommending the amendment of the Information would likewise show that the finding of probable cause against the respondents were sufficiently supported by substantial evidence. As a matter of fact, in the Resolution dated August 22, 2002, the Ombudsman took pains to mention each element of the crime of violation of Section 3(e) of Rep. Act No. 3019 and then one by one adequately explained how and why those elements were satisfied. Hence, as the amended Information was valid on its face and there is no manifest error or arbitrariness on the part of the Ombudsman, the Sandiganbayan erred in making an executive determination of probable cause when it overturned the Ombudsmans own determination. And this is true even if the Sandiganbayan was no longer satisfied with the evidence presented to sustain the effectivity of the arrest warrants previously issued for the original Information. The Sandiganbayan could have just revoked the previously issued arrest warrants and required the Ombudsman to submit additional evidence for the purpose of issuing the arrest warrants based on the amended Information. Moreover, it was clearly premature on the part of the Sandiganbayan to make a determinative finding prior to the parties presentation of their respective evidence that there was no bad faith and manifest partiality on the respondents part and undue injury on the part of the complainant. In Go v. Fifth Division, Sandiganbayan,31 we held that "it is well established that the presence or absence of the elements of the crime is evidentiary in nature and is a matter of defense that may be best passed upon after a full-blown trial on the merits."32 Also, it would be unfair to expect the prosecution to present all the evidence needed to secure the conviction of the accused upon the filing of the information against the latter. The reason is found in the nature and objective of a preliminary investigation. Here, the public prosecutors do not decide whether there is evidence beyond reasonable doubt of the guilt of the person charged; they merely determine whether there is sufficient ground to engender a wellfounded belief that a crime has been committed and that respondent is probably guilty thereof, and should be held for trial.33 The Sandiganbayan and all courts for that matter should always remember the judiciarys standing policy on non-interference in the Office of the Ombudsmans exercise of its constitutionally mandated powers. This policy is based not only upon respect for the investigatory and prosecutory powers granted by the Constitution to the Office of the Ombudsman but upon practicality as well, considering that otherwise, the functions of the courts will be grievously hampered by innumerable petitions regarding complaints filed before it, and in much the same way that the courts would be extremely swamped if they were to be compelled to review the exercise of discretion on the part of the prosecutors each time they decide to file an information in court or dismiss a complaint by a private complainant.34 WHEREFORE, the petition is GRANTED. The Sandiganbayans challenged Resolutions dated October 10, 2005 and January 18, 2006 are REVERSED and SET ASIDE. The Information against the respondents is herebyREINSTATED. Let the records of this case be REMANDED to the Sandiganbayan for further proceedings. SO ORDERED.

G.R. No. 152889 ENRIQUE V. VIUDEZ II, Petitioner, vs. THE COURT OF APPEALS and HON. BASILIO R. GABO, JR. in his capacity as Presiding Judge of Branch 11, Regional Trial Court, Malolos, Bulacan, Respondents. DECISION PERALTA, J.: This is a petition for review on certiorari under Section 1, Rule 45 of the 1997 Rules of Civil Procedure, with prayer for the issuance of a temporary restraining order and/or writ of preliminary injunction of the Decision1 of the Court of Appeals (CA) in CA-G.R. SP No. 67115 dismissing the petition for certiorari filed by herein petitioner against Judge Basilio R. Gabo, Jr., in his capacity as Presiding Judge of Branch 11, Regional Trial Court (RTC) of Malolos, Bulacan. The factual and procedural antecedents are as follows: Honorato Galvez and his driver were fatally shot on June 9, 2000 in Barangay San Juan, San Ildefonso, Bulacan. On June 26, 2000, a complaint for the alleged murder of the said victims was filed by the 303rd Philippine National Police Criminal Investigation Division (PNP CID) Team with the Office of the Provincial Prosecutor against the following: Cirilo de la Cruz, Guilberto Chico, Edmund Fernando, two persons named Ronald and Gerry, three (3) John Does, and Eulogio Villanueva. Likewise, on July 14, 2000, a complaint for murder against petitioner Enrique Viudez II was filed by Estrella Galvez, widow of Mayor Honorato Galvez, for the killing of the latter and his driver.2 On March 31, 2001, a Resolution was issued by the Investigating State Prosecutor finding probable cause to indict the petitioner and others for the crime of murder. On September 19, 2001, two (2) Informations3 for murder were filed with the RTC of Malolos, Bulacan, which then issued warrants of arrest on the same day.4 On September 21, 2001, petitioner filed a Motion to Suspend Proceedings and to Suspend the Implementation of the Warrant of Arrest, Pursuant to Department Circular No. 70 of the Department of Justice (DOJ)5 arguing that all the accused in the said criminal cases had filed a timely petition for review with the Secretary of Justice and, pursuant to Section 96 of Department Circular No. 70, the implementation of the warrant of arrest against petitioner should be suspended and/or recalled pending resolution of the said petition for review. In an Order7 dated September 28, 2001, the RTC denied petitioners Motion stating that, insofar as the implementation of the warrant of arrest against petitioner was concerned, said warrant had already been issued for his apprehension. The court also added that there was no way for it to recall the same in the absence of any compelling reason, and that jurisdiction over his person had not yet been acquired by it; hence, petitioner had no personality to file any pleading in court relative to the case until he was arrested or voluntarily

surrendered himself to the court. Thus, petitioner filed a motion for reconsideration of the said Order, but was denied in an Order dated October 10, 2001. Thereafter, petitioner filed with the CA on October 11, 2001, a petition for certiorari with prayer for the issuance of a temporary restraining order (TRO) and/or writ of preliminary injuction8 claiming the following: x x x The Order of September 28, 2001 and the Order of October 10, 2001 denying the Motion for Reconsideration were issued with grave abuse of discretion amounting to lack of jurisdiction. This is because of the following reasons: (a) The fact that the petitioner has not voluntarily surrendered nor arrested is not a legal impediment or obstacle to the suspension of the implementation of the warrant of arrest issued against the petitioner. (b) Precisely, the petitioner has prayed for the suspension of the implementation of the warrant of arrest because if he is arrested or voluntarily surrenders to the Court, the issues on the suspension of the implementation of the warrant of arrest would become moot and academic. It is for this reason that the petitioner has prayed for the suspension of the implementation of the warrant of arrest. The petitioner is merely availing of his rights under the law. There would be a waiver on the part of the petitioner if he surrenders to the lower court. Meantime, he would be deprived of his provisional liberty pending the resolution of his petition for review. The clear intention of Department Circular No. 70 is to suspend all proceedings including the implementation of the warrant of arrest pending resolution by the Secretary of Justice of the petition for review. (c) The authority of the Secretary of Justice to entertain the petition for review even after the filing of the informations is settled. In Solar Team Entertainment, Inc. v. Hon. Rolando How, the High Court ruled, "the authority of the Secretary of Justice to review resolutions of his subordinates even after an information has already been filed in court does not present an irreconcilable conflict with the 30-day period prescribed by Section 7 of the Speedy Trial Act." (d) Moreover, the authority of the Secretary of Justice to review resolutions of the Chief State Prosecutor, Provincial or City Prosecutors is recognized by Sec. 4 of Rule 112 of the Revised Rules of Criminal Procedure. (e) Sec. 4, Rule 112 of the Revised Rules of Criminal Procedure expressly recognizes the authority and power of the Department of Justice to prescribe the rules to be followed in cases of a petition for review of a resolution of the Chief State Prosecutor, Provincial or City Prosecutors. The rules provide "if upon petition by a proper party under such rules as the Department of Justice may prescribe," clearly recognizing the power of the Secretary of Justice

to promulgate rules to be followed in petitions for review of appeals from resolutions of the Chief State Prosecutor, Provincial or City Prosecutor. (f) Pursuant to the rule-making power of the Secretary of Justice, Department Circular No. 70 was promulgated by the Secretary of Justice providing that "the appellant and the trial prosecutor shall see to it that, pending resolution of the appeal, the proceedings in court are held in abeyance. (g) The implementation of the warrant of arrest issued against the petitioner is part of the proceedings in court. Since the circular unequivocally provides that the "proceedings in court are held in abeyance" pending resolution of the petition for review or appeal, it follows that the lower court committed grave abuse of discretion amounting to lack of jurisdiction when it denied the motion to suspend the implementation of the warrant of arrest. There is even no opposition by the trial prosecutor to the motion to suspend the implementation of the warrant of arrest against the petitioner.9 In a Resolution10 dated October 16, 2001, the CA found that the verified petition of petitioner sufficiently showed that unless the implementation of the warrants of arrest dated September 19, 2001 in Criminal Case Nos. 2492-M-2001 and 2693-M-2001 were temporarily enjoined before the application for a writ of preliminary injunction could be heard on notice, great or irreparable injury would be visited upon the petitioner, as he could momentarily be arrested and detained upon non-bailable charges. Thus, the CA granted a TRO, commanding respondent RTC Judge Gabo to enjoin the implementation of the said warrants of arrest. Respondents RTC Judge Basilio R. Gabo, Jr., in his capacity as Presiding Judge of the RTC, Branch II of Malolos, Bulacan, and the Office of the Solicitor General (OSG) argued in their Comment (with motion to lift temporary restraining order and opposition to the application for the issuance of a writ of preliminary injunction)11 dated November 12, 2001, that the determination of whether to issue a warrant of arrest after the filing of an information was a function that was exclusively vested in respondent Judge. Respondent Judge, therefore, was in no way obligated to defer the implementation of the service of the warrant of arrest simply because a petition for review was filed by petitioner before the Secretary of Justice to question the filing of the information against the same petitioner. As to their Opposition to the application for issuance of preliminary injunction with motion to lift temporary restraining order, the public respondents contended that the issue proposed by petitioner was the mere suspension of the implementation of the warrant of arrest to await the resolution of the Department of Justice; hence, respondent Judge was under no obligation to suspend the proceedings, because the issuance of the warrant of arrest was his exclusive function. On December 19, 2001, the CA promulgated its Decision12 dismissing the petition for certiorari for lack of merit and found no whimsicality or oppressiveness in the exercise of the respondent Judge's discretion in issuing the challenged Orders. The court added that, since the premise of petitioner's conclusion was erroneous for said circular and the cases cited did not make it obligatory for respondent Judge to grant petitioner's motion petitioner's cause

was lost. It also stated that nowhere in the Revised Rules of Criminal Procedure, or in any circular of this Court, even in any of its decision was it ever pronounced that when a petition for review of the resolution of the investigating prosecutor -- finding probable cause to indict a respondent -- is filed with the Office of the Secretary of Justice, the court which earlier issued warrants of arrest, should suspend their enforcement. In an Order13 dated January 9, 2002, respondent Judge ordered the issuance of an alias warrant of arrest for the apprehension of petitioner by virtue of the expiration of the effectivity of the TRO issued by the CA. Petitioner filed with the CA a Motion for Reconsideration14 dated January 3, 2002 of the Decision dated December 19, 2001, which was eventually denied by the same court in its Resolution15 dated April 11, 2002, stating, among others, that it found nothing to justify a modification, much less a reversal, of its judgment. The court further stated that the motion for reconsideration had not presented any fresh argument or raised any new matter that would need an extended discussion, and that the points stressed were the same as those already discussed in the petition and other papers of the petitioner which were fully considered in the decision. Hence, the instant petition. Petitioner claimed, among others, that the Decision of the CA was issued with grave abuse of discretion amounting to lack of jurisdiction when it ruled that Department Circular No. 70 of the Department of Justice promulgated on July 3, 2000 was plainly a directive of the Secretary of Justice to the accused and the trial prosecutor to ask the Court to suspend the proceedings thereon during the pendency of the appeal. According to petitioner, the said department circular had the force and effect of law. He cited cases16 wherein this Court ruled that administrative regulations adopted pursuant to law had the force and effect of law. Petitioner also pointed out that the same department circular stated that its promulgation was in line with recent jurisprudence. Anent the prayer for the issuance of a TRO, petitioner argued that unless a TRO was issued enjoining the implementation of the warrant of arrest dated September 19, 2001 and the alias warrant of arrest issued by virtue of the Order of January 9, 2002, he stood to suffer great and irreparable injury, as he would be deprived of his liberty without due process of law. In a Resolution17 dated May 6, 2002, this Court resolved to issue the TRO prayed for by petitioner and to direct respondent Judge to cease and desist from implementing the warrant of arrest dated September 19, 2001 against petitioner and the alias warrant of arrest issued pursuant to the Order of January 9, 2002 in Criminal Case Nos. 2492-M-2001 and 2493-M-2001, entitled "People of the Philippines vs. Enrique V. Viudez II, et al.," effective immediately until further orders from the same Court. In its Comment18 dated June 13, 2002, the OSG stated that the determination of whether to issue a warrant of arrest after the filing of an information was a function that was exclusively vested in respondent Judge. Respondent Judge, therefore, was in no way obliged to defer the implementation of the service of the warrant simply because a petition for review was filed by petitioner before the Secretary of Justice to question the filing of the information against him. The

OSG further argued that the respondent Judge did not need to wait for the completion of the preliminary investigation before issuing a warrant of arrest, for Section 4, Rule 113 of the Rules of Criminal Procedure provides that the head of the office to whom the warrant of arrest has been delivered for execution shall cause the warrant to be executed within ten (10) days from receipt thereof. As an opposition to the application for issuance of preliminary injunction and as a motion to lift the temporary restraining order, the OSG stated that the petitioner did not challenge the finding of probable cause of respondent Judge in the issuance of the warrant of arrest against him. Petitioner simply wanted a deferment of its implementation by virtue of Section 9 of Department Circular No. 70; hence, according to the OSG, the issuance of the TRO was tantamount to an abatement of the criminal proceedings. Petitioner, in its Opposition19 to the motion to lift temporary restraining order dated September 5, 2002 stated that the discussion of the evidence of the prosecution by the OSG was way off the mark, because the only issue to be resolved in the present petition was whether the implementation of the warrant of arrest issued by the RTC should be suspended pending resolution by the Secretary of Justice of the petition for review filed by petitioner. He also reiterated that the lifting of the TRO would cause grave and irreparable injury to his rights because no bail had been recommended for his provisional liberty. On September 19, 2002, petitioner filed a Manifestation20 informing this Court that the Secretary of Justice had already sustained his petition for review. A photocopy of the Resolution21 of the Secretary of Justice, promulgated on September 13, 2002, was attached to the said manifestation, the dispositive portion of which reads, among others: [t]he Chief State Prosecutor is directed to move, with leave of court, for the withdrawal of the information for murder (2 counts) against Mayor Enrique V. Viudez II and Eulogio Villanueva immediately. In view of the same resolution, according to petitioner, the motion of the OSG for the lifting of the TRO issued by this Court has no more legal basis and should be denied for lack of merit. In his Reply22 to the Comment of the OSG, dated November 6, 2002, petitioner reiterated that the Secretary of Justice had already issued a resolution on the petition for review that he filed with the said office, and that the State Prosecutor had already filed with the RTC a motion to withdraw the information against him and his co-accused; hence, the instant petition may already be moot and academic because of the said developments. On December 2, 2002, this Court resolved to give due course to the present petition and required the parties to submit their respective memoranda.23 Petitioner eventually filed his Memorandum24 dated February 4, 2003, while the OSG filed its Memorandum on March 24, 2003. Before this Court shall delve into its disquisition on the issue propounded by petitioner, it is worth noting that in his Memorandum25 dated February 4, 2003, petitioner reiterated that the Secretary of Justice had already resolved the petition for review and ordered the withdrawal of the informations for murder filed against the same petitioner with the RTC of Malolos, Bulacan, ruling that there was no probable cause for the filing of the said informations. Accordingly, as contained in the same Memorandum, the Office of the State Prosecutor filed

a Motion26 to Withdraw the Informations, which the RTC granted on October 23, 2002. 27 Furthermore, in a Resolution dated May 6, 2002, this Court already resolved to issue a TRO as prayed for by petitioner. These developments would necessarily render the instant petition moot and academic; however, as implored by petitioner, this Court will render its decision on the merits of the case in the interest of justice. The basic issue propounded by petitioner is whether a pending resolution of a petition for review filed with the Secretary of Justice concerning a finding of probable cause will suspend the proceedings in the trial court, including the implementation of a warrant of arrest. Petitioner cites DOJ Department Circular No. 70, specifically paragraph 2 of Section 9 thereof, which provides that the appellant and the trial prosecutor shall see to it that, pending resolution of the appeal, the proceedings in court are held in abeyance. Somehow, petitioner is of the opinion that the suspension of proceedings in court, as provided in the said circular, includes the suspension of the implementation of warrants of arrest issued by the court. Petitioner's contention is wrong. It is well to remember that there is a distinction between the preliminary inquiry, which determines probable cause for the issuance of a warrant of arrest; and the preliminary investigation proper, which ascertains whether the offender should be held for trial or be released. The determination of probable cause for purposes of issuing a warrant of arrest is made by the judge. The preliminary investigation proper whether or not there is reasonable ground to believe that the accused is guilty of the offense charged is the function of the investigating prosecutor.28 As enunciated in Baltazar v. People,29 the task of the presiding judge when the Information is filed with the court is first and foremost to determine the existence or non-existence of probable cause for the arrest of the accused. Probable cause is such set of facts and circumstances as would lead a reasonably discreet and prudent man to believe that the offense charged in the Information or any offense included therein has been committed by the person sought to be arrested. In determining probable cause, the average man weighs the facts and circumstances without resorting to the calibrations of the rules of evidence of which he has no technical knowledge. He relies on common sense. A finding of probable cause needs only to rest on evidence showing that, more likely than not, a crime has been committed and that it was committed by the accused. Probable cause demands more than suspicion; it requires less than evidence that would justify conviction. 30 The purpose of the mandate of the judge to first determine probable cause for the arrest of the accused is to insulate from the very start those falsely charged with crimes from the tribulations, expenses and anxiety of a public trial. 31 The function of the judge to issue a warrant of arrest upon the determination of probable cause is exclusive; thus, the consequent implementation of a warrant of arrest cannot be deferred pending the resolution of a petition for review by the Secretary of Justice as to the finding of probable cause, a function that is executive in nature. To defer the implementation of the warrant of arrest would

be an encroachment on the exclusive prerogative of the judge.1avvphi1 It must be emphasized that petitioner filed with the trial court a motion to suspend proceedings and to suspend the implementation of the warrant of arrest in pursuance of a DOJ circular, and not a motion to quash the warrant of arrest questioning the issuance thereof. Thus, there is no contest as to the validity or regularity of the issuance of the warrant of arrest. Petitioner merely wanted the trial court to defer the implementation of the warrant of arrest pending the resolution by the Secretary of Justice of the petition for review that he filed citing the following directive contained in Section 9 of DOJ Department Circular: xxxx The appellant and the trial prosecutor shall see to it that, pending resolution of the appeal, the proceedings in court are held in abeyance. 32 The above provision of the Department Circular is directed specifically at the appellant and the trial prosecutor, giving them latitude in choosing a remedy to ensure that the proceedings in court are held in abeyance. However, nowhere in the said provision does it state that the court must hold the proceedings in abeyance. Therefore, the discretion of the court whether or not to suspend the proceedings or the implementation of the warrant of arrest, upon the motion of the appellant or the trial prosecutor, remains unhindered. This is in consonance with the earlier ruling33 of this Court that once a complaint or information is filed in court, any disposition of the case as to its dismissal, or the conviction or acquittal of the accused, rests on the sound discretion of the said court, as it is the best and sole judge of what to do with the case before it. In the instant case, the judge of the trial court merely exercised his judicial discretion when he denied petitioner's motion to suspend the implementation of the warrant of arrest. Consequently, the CA was correct when it found no whimsicality or oppressiveness in the exercise of the trial judge's discretion in issuing the challenged orders. Neither does this Court find any applicability of the cases cited by the petitioner to the instant case. Petitioner has put emphasis on his argument that the suspension of the proceedings in court, including the suspension of the implementation of a warrant of arrest pending a resolution of an appeal by the Secretary of Justice, is in consonance with jurisprudence laid down by this Court in Marcelo v. Court of Appeals, 34 Roberts, Jr. v. Court of Appeals, 35 Ledesma v. Court of Appeals,36 Dimatulac v. Villon,37 and Solar Team Entertainment, Inc. v. How.38 A close reading of the factual antecedents in Ledesma, Solar Team Entertainment, Inc., Dimatulac and Marceloclearly show that a common issue among them is whether the arraignment of an accused may be deferred pending resolution by the Secretary of Justice of a petition for review on the finding of probable cause, to which this Court ruled in the affirmative. Nowhere in the said decisions did it state that the implementation or enforcement of the warrant of arrest was also deferred or suspended, as herein petitioner prays for. Thus, as ruled inLedesma:39 Where the secretary of justice exercises his power of review only after an information has been filed, trial courts should defer or

suspend arraignment and further proceedings until the appeal is resolved. Such deferment or suspension, however, does not signify that the trial court is ipso facto bound by the resolution of the secretary of justice. Jurisdiction, once acquired by the trial court, is not lost despite a resolution by the secretary of justice to withdraw the information or to dismiss the case. It was also decided in Solar Team Entertainment, Inc.40 that: Procedurally speaking, after the filing of the information, the court is in complete control of the case and any disposition therein is subject to its sound discretion. The decision to suspend arraignment to await the resolution of an appeal with the Secretary of Justice is an exercise of such discretion. The ruling in Dimatulac,41 as well, reads: We do not then hesitate to rule that Judge Villon committed grave abuse of discretion in rushing the arraignmentof the Yabuts on the assailed information for homicide. Again, the State and the offended parties were deprived of due process. And in Marcelo,42 this Court enunciated that: Accordingly, we rule that the trial court in a criminal case which takes cognizance of an accused's motion for review of the resolution of the investigating prosecutor or for reinvestigation and defers the arraignment until resolution of the said motion must act on the resolution reversing the investigating prosecutor's finding or on a motion to dismiss based thereon only upon proof that such resolution is already final in that no appeal was taken therefrom to the Department of Justice.1avvphi1 Finally, in Roberts, petitioner claimed that this Court, in the dispositive portion of its decision, clearly directed the deferment of the issuance of the warrant of arrest pending resolution of the petition for review by the Secretary of Justice when it ruled that, in the meantime, respondent Judge Asuncion was directed to cease and desist from further proceeding with Criminal Case No. Q-93-43198 and to defer the issuance of warrants of arrest against the petitioner. According to petitioner, the said dispositive portion is borne out by the finding of this Court that: x x x [I]t was premature for respondent Judge Asuncion to deny the motions to suspend proceedings and to defer arraignment on the following grounds: "This case is already in this Court for trial. To follow whatever the opinion the Secretary of Justice may have on the matter would undermine the independence and integrity of this Court. This Court is still capable of administering justice." The real and ultimate test of the independence and integrity of his court is not the filing of the aforementioned motions at that stage of the proceedings but the filing of a motion to dismiss or to withdraw the information on a basis of a resolution of the petition for review reversing the Joint Resolution of the investigating prosecutor. Once a motion to dismiss or withdraw the information is filed the trial judge may grant or deny it, not out of

subservience to the Secretary of Justice, but in faithful exercise of judicial prerogative.43 However, the above observation of petitioner is inaccurate, if not erroneous. What this Court adjudged as premature in Roberts was the respondent judge's denial of the motions to suspend proceedings and to defer arraignment on the ground that the case was already in his court for trial and to follow whatever opinion the Secretary of Justice may have on the matter would undermine the independence and integrity of his court, which was still capable of administering justice. In dispelling the ground relied upon by the respondent judge, this Court ruled that the filing of a motion to dismiss or to withdraw the information, on the basis of a resolution of the petition for review reversing the finding of the investigating prosecutor, was the real and ultimate test of the independence and integrity of his court. Therefore, what was disapproved by this Court was not the denial per se of the motions, but the reasoning behind it. It was from that premise that this Court ordered in the dispositive portion of its decision to defer the issuance of the warrants of arrest. Of more importance still was the fact that, whereas the questioned motions in Roberts were for the suspension of proceedings and deferment of arraignment, the issue in the instant case is the suspension of the implementation of a warrant of arrest, which this Court did not rule upon in the former case. WHEREFORE, the petition for review on certiorari with prayer for the issuance of a temporary restraining order and/or writ of preliminary injunction dated April 25, 2002 is DENIED -- the petition for review, for lack of merit; and the issuance of TRO and/or preliminary injunction, for being moot and academic. SO ORDERED.

G.R. No. 180165

April 7, 2009

transaction only after they were served a copy of the Affidavit-Complaint of the petitioner. After the requisite preliminary investigation, the City Prosecutor found that no probable cause existed and dismissed Information Sheet (I.S.) No. 02G-30918 in a Resolution10 dated 23 January 2003. While the City Prosecutor was not persuaded by the defense proffered by private respondents that no trust receipt transaction existed, it nonetheless, dismissed the case for lack of evidence that prior demand was made by petitioner. The City Prosecutor underscored that for a charge of estafa with grave abuse of confidence to prosper, previous demand is an indispensable requisite. To prove that a demand was made prior to the institution of the criminal complaint, petitioner attached to its Motion for Reconsideration a copy of a letter-demand11 dated 27 February 2001, addressed to private respondents. After the element of prior demand was satisfied, the City Prosecutor issued a Resolution12 dated 11 October 2004 finding probable cause for estafa under Article 315, paragraph 1(b)13 of the Revised Penal Code, in relation to Presidential Decree No. 115.14 Accordingly, 23 separate Informations15 for estafa were filed before the Regional Trial Court (RTC) of Manila against private respondents. The cases were docketed as Criminal Cases No. 04231721-44 and raffled to Branch 17 of the said court. In the interim, private respondents appealed the investigating prosecutors Resolution to the Secretary of Justice. In a Resolution16 dated 31 March 2005, the Secretary of Justice ruled that there was no probable cause to prosecute private respondents for estafa in relation to Presidential Decree No. 115. The Secretary of Justice declared that the legitimate transactional relationship between the parties being merely a contract of loan, violations of the terms thereunder were not covered by Presidential Decree No. 115. Thus, the Secretary of Justice directed the City Prosecutor of Manila to move for the withdrawal of the Informations. In a subsequent Resolution17 dated 30 August 2005, the Secretary of Justice denied petitioners Motion for Reconsideration, for the matters raised therein had already been passed upon in his prior resolution. Acting on the directive of the Secretary of Justice, the City Prosecutor moved for the withdrawal of the Informations which was granted by the RTC in an Order18 dated 29 July 2005. Consequently, Criminal Cases No. 04-231721 to No. 04231744 were withdrawn. The RTC refused to reconsider its earlier resolution in an Order19 dated 3 February 2006, thereby denying petitioners Motion for Reconsideration. From the adverse Resolutions of the Secretary of Justice, petitioner elevated its case before the Court of Appeals by filing a Petition for Certiorari,20 which was docketed as CA-G.R. SP No. 91892. Petitioner averred in its Petition that the Secretary of Justice abused his discretion in ignoring the established facts and legal principles when he ruled that probable cause for the crime of estafa was absent. The Court of Appeals, however, in its Decision21 dated 30 March 2007, dismissed petitioners Petition for Certiorari after finding that the Secretary of

METROPOLITAN BANK & TRUST COMPANY, Petitioner, vs. HON. SECRETARY OF JUSTICE RAUL M. GONZALES, OLIVER T. YAO and DIANA T. YAO, Respondents. CHICO-NAZARIO, J.: Before this Court is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court filed by petitioner Metropolitan Bank and Trust Company, seeking to reverse and set aside the Decision1 dated 30 March 2007and the Resolution2 dated 16 October 2007 of the Court of Appeals in CAG.R. SP No. 91892. In its assailed Decision and Resolution, the appellate court affirmed the Resolution3 of the Secretary of Justice directing the City Prosecutor of Manila to move for the withdrawal of the Informations for Estafa filed against private respondents Oliver T. Yao and Diana T. Yao. The factual and procedural antecedents of this present petition are as follows: Petitioner is a banking institution duly authorized to engage in the banking business under Philippine laws. Private respondents were the duly authorized representatives of Visaland Inc. (Visaland), likewise a domestic corporation engaged in the real estate development business. In order to finance the importation of materials necessary for the operations of its sister company, Titan Ikeda Construction and Development Corporation (TICDC), private respondents, on behalf of Visaland, applied with petitioner for 24 letters of credit, the aggregate amount of which reached the sum of P68,749,487.96. Simultaneous with the issuance of the letters of credit, private respondents signed trust receipts4 in favor of petitioner. Private respondents bound themselves to sell the goods covered by the letters of credit and to remit the proceeds to petitioner, if sold, or to return the goods, if not sold, on or before their agreed maturity dates. When the trust receipts matured, private respondents failed to return the goods to petitioner, or to return their value amounting to P68,749,487.96 despite demand. Thus, petitioner filed a criminal complaint5 for estafa6against Visaland and private respondents with the Office of the City Prosecutor of Manila (City Prosecutor).7 In their Counter-Affidavit,8 private respondents denied having entered into trust receipt transactions with petitioner. Instead, private respondents claimed that the contract entered into by the parties was a Contract of Loan secured by a Real Estate Mortgage over two parcels of land situated at Tagaytay City and registered under the name of the spouses Wilbert and Isabelita King (the spouses King).9 According to private respondents, petitioner made them sign documents bearing fine prints without apprising them of the real nature of the transaction involved. Private respondents came to know of the trust receipt

Justice committed no grave abuse of discretion in ruling against the existence of probable cause to prosecute private respondents. In arriving at its assailed decision, the appellate court recognized the authority of the Secretary of Justice to control and supervise the prosecutors, which includes the power to reverse or modify their decisions without committing grave abuse of discretion. Similarly ill-fated was Petitioners Motion for Reconsideration in a Resolution22 dated 16 October 2007. Unfazed by the turn of events, petitioner now comes before this Court urging us to reverse the Court of Appeals Decision and Resolution and to direct the filing of Informations against private respondents. For the disposition of this Court is the sole issue of: WHETHER OR NOT PROBABLE CAUSE EXISTS FOR THE PROSECUTION OF PRIVATE RESPONDENTS FOR THE CRIME OF ESTAFA IN RELATION TO P.D. NO. 115. Petitioner impugns the findings of the appellate court sustaining the nonexistence of probable cause as found by the Secretary of Justice. Petitioner insists that the allegations in its complaint, together with the pieces of evidence appended thereon, are sufficient to sustain a finding of probable cause in preliminary investigation. Asserting their innocence, private respondents continue to argue that the agreement contracted by parties is one of loan, and not of trust receipt. To buttress their contention, private respondents aver that a contract of mortgage was executed by the spouses King to secure private respondents loan obligation with petitioner, the proceeds of which were the ones utilized to finance the importation of materials.23 Private respondents likewise defend the assailed Court of Appeals Decision and assert that the Secretary of Justice was justified in overruling the investigating prosecutors findings, as sanctioned by Section 12 of DOJ Department Order No. 70.24 The present petition bears impressive merits. Probable cause has been defined as the existence of such facts and circumstances as would excite the belief in a reasonable mind, acting on the facts within the knowledge of the prosecutor, that the person charged was guilty of the crime for which he was prosecuted. Probable cause is a reasonable ground of presumption that a matter is, or may be, well founded on such a state of facts in the mind of the prosecutor as would lead a person of ordinary caution and prudence to believe, or entertain an honest or strong suspicion, that a thing is so.25 The term does not mean "actual or positive cause" nor does it import absolute certainty. It is merely based on opinion and reasonable belief. Thus, a finding of probable cause does not require an inquiry into whether there is sufficient evidence to procure a conviction. It is enough that it is believed that the act or omission complained of constitutes the offense charged. Precisely, there is a trial for the reception of evidence of the prosecution in support of the charge.26

To determine the existence of probable cause, there is need to conduct preliminary investigation. A preliminary investigation constitutes a realistic judicial appraisal of the merits of a case.27 Its purpose is to determine whether (a) a crime has been committed; and (b) whether there is a probable cause to believe that the accused is guilty thereof.28 It is a means of discovering which person or persons may be reasonably charged with a crime. The conduct of preliminary investigation is executive in nature. The Court may not be compelled to pass upon the correctness of the exercise of the public prosecutors function unless there is a showing of grave abuse of discretion or manifest error in his findings.29 Grave abuse of discretion implies a capricious and whimsical exercise of judgment tantamount to lack or excess of jurisdiction.30 The exercise of power must have been done in an arbitrary or a despotic manner by reason of passion or personal hostility. It must have been so patent and gross as to amount to an evasion of positive duty or a virtual refusal to perform the duty enjoined or to act at all in contemplation of law.31 In the present case, the abuse of discretion is patent in the act of the Secretary of Justice holding that the contractual relationship forged by the parties was a simple loan, for in so doing, the Secretary of Justice assumed the function of the trial judge of calibrating the evidence on record, done only after a full-blown trial on the merits. The fact of existence or non-existence of a trust receipt transaction is evidentiary in nature, the veracity of which can best be passed upon after trial on the merits, for it is virtually impossible to ascertain the real nature of the transaction involved based solely on the self-serving allegations contained in the opposing parties pleadings. Clearly, the Secretary of Justice is not in a competent position to pass judgment on substantive matters. The bases of a partys accusation and defenses are better ventilated at the trial proper than at the preliminary investigation. We need not overemphasize that in a preliminary investigation, the public prosecutor merely determines whether there is probable cause or sufficient ground to engender a well-founded belief that a crime has been committed, and that the respondent is probably guilty thereof and should be held for trial. It does not call for the application of rules and standards of proof that a judgment of conviction requires after trial on the merits. The complainant need not present at this stage proof beyond reasonable doubt. A preliminary investigation does not require a full and exhaustive presentation of the parties evidence.32 Precisely, there is a trial to allow the reception of evidence for both parties to substantiate their respective claims. Having said the foregoing, this Court now proceeds to determine whether probable cause exists for holding private respondents liable for estafa in relation to Presidential Decree No. 115. Trust receipt transactions are governed by the provisions of Presidential Decree No. 115 which defines such a transaction as follows: Section 4. What constitutes a trust receipt transaction. A trust receipt transaction, within the meaning of this Decree, is any transaction by and between a person referred to in this Decree as the entruster, and another person referred to in this Decree as the entrustee, whereby the entruster, who owns or holds absolute title or security interests over certain specified goods,

documents or instruments, releases the same to the possession of the entrustee upon the latters execution and delivery to the entruster of a signed document called a "trust receipt" wherein the entrustee binds himself to hold the designated goods, documents or instruments in trust for the entruster and to sell or otherwise dispose of the goods, documents or instruments with the obligation to turn over to the entruster the proceeds thereof to the extent of the amount owing to the entruster or as appears in the trust receipt or the goods, documents or instruments themselves if they are unsold or not otherwise disposed of, in accordance with the terms and conditions specified in the trust receipt, or for other purposes substantially equivalent to any one of the following: 1. In the case of goods or documents, (a) to sell the goods or procure their sale; or (b) to manufacture or process the goods with the purpose of ultimate sale: Provided, That, in the case of goods delivered under trust receipt for the purpose of manufacturing or processing before its ultimate sale, the entruster shall retain its title over the goods whether in its original or processed form until the entrustee has complied fully with his obligation under the trust receipt; or (c) to load, unload, ship or transship or otherwise deal with them in a manner preliminary or necessary to their sale; or 2. In the case of instruments, a) to sell or procure their sale or exchange; or b) to deliver them to a principal; or c) to effect the consummation of some transactions involving delivery to a depository or register; or d) to effect their presentation, collection or renewal. The sale of goods, documents or instruments by a person in the business of selling goods, documents or instruments for profit who, at the outset of the transaction, has, as against the buyer, general property rights in such goods, documents or instruments, or who sells the same to the buyer on credit, retaining title or other interest as security for the payment of the purchase price, does not constitute a trust receipt transaction and is outside the purview and coverage of this Decree. An entrustee is one having or taking possession of goods, documents or instruments under a trust receipt transaction, and any successor in interest of such person for the purpose of payment specified in the trust receipt agreement. The entrustee is obliged to (1) hold the goods, documents or instruments in trust for the entruster and shall dispose of them strictly in accordance with the terms and conditions of the trust receipt; (2) receive the proceeds in trust for the entruster and turn over the same to the entruster to the extent of the amount owed to the entruster or as appears on the trust receipt; (3) insure the goods for their total value against loss from fire, theft, pilferage or other casualties; (4) keep said goods or the proceeds therefrom whether in money or whatever form, separate and capable of identification as property of the entruster; (5) return the goods, documents or instruments in the event of non-sale or upon demand of the entruster; and (6) observe all other terms and conditions of the trust receipt not contrary to the provisions of the decree.33 The entruster shall be entitled to the proceeds from the sale of the goods, documents or instruments released under a trust receipt to the entrustee to the extent of the amount owed to the entruster or as appears in the trust receipt; or

to the return of the goods, documents or instruments in case of non-sale; and to the enforcement of all other rights conferred on him in the trust receipt, provided these are not contrary to the provisions of the document.34 A violation of any of these undertakings constitutes estafa defined under Article 315(1)(b) of the Revised Renal Code, as provided by Section 13 of Presidential Decree No. 115 viz: Section 13. Penalty Clause. The failure of an entrustee to turn over the proceeds of the sale of the goods, documents or instruments covered by a trust receipt to the extent of the amount owing to the entruster or as appears in the trust receipt or to return said goods, documents or instruments if they were not sold or disposed of in accordance with the terms of the trust receipt shall constitute the crime of estafa, punishable under the provisions of Article Three hundred and fifteen, paragraph one (b) of Act Numbered Three thousand eight hundred and fifteen, as amended, otherwise known as the Revised Penal Code. If the violation or offense is committed by a corporation, partnership, association or other juridical entities, the penalty provided for in this Decree shall be imposed upon the directors, officers, employees or other officials or persons therein responsible for the offense, without prejudice to the civil liabilities arising from the criminal offense. Apropos thereto, Article 315(1)(b) of the Revised Renal Code punishes estafa committed as follows: ARTICLE 315. Swindling (estafa). Any person who shall defraud another by any of the means mentioned hereinbelow shall be punished by: 1st. The penalty of prision correccional in its maximum period to prision mayor in its minimum period, if the amount of the fraud is over 12,000 pesos but does not exceed 22,000 pesos, and if such amount exceeds the latter sum, the penalty provided in this paragraph shall be imposed in its maximum period, adding one year for each additional 10,000 pesos; but the total penalty which may be imposed shall not exceed twenty years. In such case, and in connection with the accessory penalties which may be imposed and for the purpose of the other provisions of this Code, the penalty shall be termed prision mayor to reclusion temporal, as the case may be. 2nd. The penalty of prision correccional in its minimum and medium periods, if the amount of the fraud is over 6,000 pesos but does not exceed 12,000 pesos; 3rd. The penalty of arresto mayor in its maximum period to prision correccional in its minimum period, if such amount is over 200 pesos but does not exceed 6,000 pesos; and 4th. By arresto mayor in its medium and maximum periods, if such amount does not exceed 200 pesos, provided that in the four cases mentioned, the fraud be committed by any of the following means; x x x.

As found in the Complaint-Affidavit of petitioner, private respondents were charged with failing to account for or turn over to petitioner the merchandise or goods covered by the trust receipts or the proceeds of the sale thereof in payment of their obligations thereunder. The following pieces of evidence adduced from the affidavits and documents submitted before the City Prosecutor are sufficient to establish the existence of probable cause, to wit: First, the trust receipts35 bearing the genuine signatures of private respondents; second, the demand letter36 of petitioner addressed to respondents; and third, the initial admission by private respondents of the receipt of the imported goods from petitioner.37 Prescinding from the foregoing, we conclude that there is ample evidence on record to warrant a finding that there is a probable cause to warrant the prosecution of private respondents for estafa. It must be once again stressed that probable cause does not require an inquiry into whether there is sufficient evidence to procure a conviction. It is enough that it is believed that the act or omission complained of constitutes the offense charged. That private respondents did not sell the goods under the trust receipt but allowed it to be used by their sister company is of no moment. The offense punished under Presidential Decree No. 115 is in the nature of malum prohibitum. A mere failure to deliver the proceeds of the sale or the goods, if not sold, constitutes a criminal offense that causes prejudice not only to another, but more to the public interest.38 Even more incredible is the contention of private respondents that they did not give much significance to the documents they signed, considering the enormous value of the transaction involved. Thus, it is highly improbable to mistake trust receipt documents for a contract of loan when the heading thereon printed in bold and legible letters reads: "Trust Receipts." We are not prejudging this case on the merits. However, by merely glancing at the documents submitted by petitioner entitled "Trust Receipts" and the arguments advanced by private respondents, we are convinced that there is probable cause to file the case and to hold them for trial.1avvphi1 All told, the evidentiary measure for the propriety of filing criminal charges has been reduced and liberalized to a mere probable cause. As implied by the words themselves, "probable cause" is concerned with probability, not absolute or moral certainty.39 WHEREFORE, premises considered, the instant Petition is GRANTED. The Decision dated 30 March 2007 and the Resolution dated 16 October 2007 of the Court of Appeals in CA-G.R. SP No. 91892 are REVERSED and SET ASIDE. The Secretary of Justice is hereby ORDERED to direct the Office of the City Prosecutor of Manila to forthwith FILE Informations for estafa against private respondents Oliver T. Yao and Diana T. Yao before the appropriate court. SO ORDERED.

G.R. No. 177727

January 19, 2010

HAROLD V. TAMARGO, Petitioner, vs. ROMULO AWINGAN, LLOYD ANTIPORDA and LICERIO ANTIPORDA, JR., Respondents. DECISION CORONA, J.: This is a petition for review on certiorari1 of the November 10, 2006 decision2 and May 18, 2007 resolution3 of the Court of Appeals (CA) in CA-G.R. SP No. 93610. Atty. Franklin V. Tamargo and his eight-year-old daughter, Gail Franzielle, were shot and killed at around 5:15 p.m. of August 15, 2003 along Nueva Street corner Escolta Street, Binondo, Manila. The police had no leads on the perpetrators of the crime until a certain Reynaldo Geron surfaced and executed an affidavit dated September 12, 2003. He stated that a certain Lucio Columna told him during a drinking spree that Atty. Tamargo was ordered killed by respondent Lloyd Antiporda and that he (Columna) was one of those who killed Atty. Tamargo. He added that he told the Tamargo family what he knew and that the sketch of the suspect closely resembled Columna.4 After conducting a preliminary investigation and on the strength of Gerons affidavit, the investigating prosecutor5issued a resolution dated December 5, 2003 finding probable cause against Columna and three John Does.6 On February 2, 2004, the corresponding Informations for murder were filed against them in the Regional Trial Court (RTC) of Manila, one assigned to Branch 27 for the death of Atty. Franklin Tamargo, and the other to Branch 29 for the death of the minor Gail Franzielle.7 Columna was arrested in the province of Cagayan on February 17, 2004 and brought to Manila for detention and trial.8 On March 8, 2004, Columna (whose real name was Manuel, Jr.) executed an affidavit wherein he admitted his participation as "look out" during the shooting and implicated respondent Romulo Awingan (alias "Mumoy") as the gunman and one Richard Mecate. He also tagged as masterminds respondent Licerio Antiporda, Jr. and his son, respondent Lloyd Antiporda.9 The former was the exmayor and the latter the mayor of Buguey, Cagayan at that time. When the killing took place, Licerio Antiporda was in detention for a kidnapping case in which Atty. Tamargo was acting as private prosecutor. Pursuant to this affidavit, petitioner Harold V. Tamargo (brother of Atty. Tamargo) filed a complaint against those implicated by Columna in the Office of the City Prosecutor of Manila.10 On April 19, 2004, Columna affirmed his affidavit before the investigating prosecutor11 who subjected him to clarificatory questions.12

Respondents denied any involvement in the killings. They alleged that Licerio was a candidate for mayor in Buguey, Cagayan during the May 2004 elections and that the case was instituted by his political opponents in order to derail his candidacy. The Antipordas admitted that Atty. Tamargo was their political rival for the mayoralty post of Buguey. Atty. Tamargo had been defeated twice by Lloyd and once by Licerio. Before the killing, Atty. Tamargo filed an election case against Lloyd and a kidnapping case in the Sandiganbayan against Licerio. However, they claimed that both cases were dismissed as Lloyd emerged as the winner in the elections and Licerio was acquitted by the Sandiganbayan.13 During the preliminary investigation, respondent Licerio presented Columnas unsolicited handwritten letter dated May 3, 2004 to respondent Lloyd, sent from Columnas jail cell in Manila. In the letter, Columna disowned the contents of his March 8, 2004 affidavit and narrated how he had been tortured until he signed the extrajudicial confession. He stated that those he implicated had no participation in the killings.14 Respondent Licerio also submitted an affidavit of Columna dated May 25, 2004 wherein the latter essentially repeated the statements in his handwritten letter. Due to the submission of Columnas letter and affidavit, the investigating prosecutor set a clarificatory hearing, to enable Columna to clarify his contradictory affidavits and his unsolicited letter. During the hearing held on October 22, 2004, Columna categorically admitted the authorship and voluntariness of the unsolicited letter. He affirmed the May 25, 2004 affidavit and denied that any violence had been employed to obtain or extract the affidavit from him.151avvphi1 Thus, on November 10, 2004, the investigating prosecutor recommended the dismissal of the charges. This was approved by the city prosecutor. Meanwhile, in another handwritten letter addressed to City Prosecutor Ramon Garcia dated October 29, 2004, Columna said that he was only forced to withdraw all his statements against respondents during the October 22, 2004 clarificatory hearing because of the threats to his life inside the jail. He requested that he be transferred to another detention center.16 Aggrieved by the dismissal of the charges, petitioner filed an appeal to the Department of Justice (DOJ).17 On May 30, 2005, the DOJ, through then Secretary Raul M. Gonzalez, reversed the dismissal and ordered the filing of the Informations for murder.18 He opined that the March 8, 2004 extrajudicial confession was not effectively impeached by the subsequent recantation and that there was enough evidence to prove the probable guilt of respondents.19 Accordingly, the Informations were filed and the cases were consolidated and assigned to the RTC of Manila, Branch 29.20 However, on August 12, 2005, Secretary Gonzales granted the Antipordas motion for reconsideration (MR) and directed the withdrawal of the Informations.21 This time, he declared that the extrajudicial confession of Columna was inadmissible against respondents and that, even if it was admissible, it was not corroborated by other evidence.22 As a result, on August 22, 2005, the trial prosecutor filed a motion to withdraw the Informations. On October 4, 2005, Secretary Gonzalez denied petitioners MR.

The RTC, through Judge Cielito Mindaro-Grulla, granted the motion to withdraw the Informations in an order dated October 26, 2005.23 Petitioner filed an MR but the judge voluntarily inhibited herself without resolving the same. The cases were re-raffled to Branch 19, presided by Judge Zenaida R. Daguna. Judge Daguna granted the MR of petitioner in a resolution dated December 9, 2005. She ruled that, based on Columnas March 8, 2004 affidavit which he affirmed before the investigating prosecutor, there was probable cause to hold the accused for trial. She denied the MR of the Antipordas in an order dated February 6, 2006. Consequently, respondent Awingan filed a special civil action for certiorari and prohibition in the CA docketed as CA-G.R. SP No. 93610. The Antipordas separately filed another certiorari case docketed as CA-G.R. SP No. 94188. In a decision dated November 10, 2006 in CA-G.R. SP No. 93610, the CA ruled that the RTC judge gravely abused her discretion because she arbitrarily left out of her assessment and evaluation the substantial matters that the DOJ Secretary had fully taken into account in concluding that there was no probable cause against all the accused. It also held that Columnas extrajudicial confession was not admissible against the respondents because, aside from the recanted confession, there was no other piece of evidence presented to establish the existence of the conspiracy. Additionally, the confession was made only after Columna was arrested and not while the conspirators were engaged in carrying out the conspiracy. After this decision was promulgated, CA-G.R. SP No. 93610 was consolidated with CA-G.R. SP No. 94188. The CA denied reconsideration in a resolution dated May 18, 2007. In a decision dated August 24, 2007, the CA likewise granted the petition for certiorari of respondents Antiporda.24 Petitioner filed this petition assailing the decision in CA-G.R. SP No. 93610. Later on, he filed an amended petition impleading respondents Antiporda and likewise assailing the CA decision in CA-G.R. SP No. 94188. The Court treated this as a supplemental petition. The main issue for our resolution is whether or not the CA erred in finding that Judge Daguna had committed grave abuse of discretion in denying the withdrawal of the Informations for murder against respondents. Petitioner argues that, based on the independent assessment of Judge Daguna, there was probable cause based on the earlier affidavit of Columna. She considered all the pieces of evidence but did not give credit to Columnas recantation. Respondents counter that Judge Daguna committed grave abuse of discretion by limiting her evaluation and assessment only to evidence that supported probable cause while completely disregarding contradicting evidence. They also contend that Columnas extrajudicial confession was inadmissible against respondents because of the rule on res inter alios acta. We find no merit in the petition.

It is settled that, when confronted with a motion to withdraw an Information (on the ground of lack of probable cause to hold the accused for trial based on a resolution of the DOJ Secretary), the trial court has the duty to make an independent assessment of the merits of the motion.25 It may either agree or disagree with the recommendation of the Secretary. Reliance alone on the resolution of the Secretary would be an abdication of the trial courts duty and jurisdiction to determine a prima facie case.26 The court must itself be convinced that there is indeed no sufficient evidence against the accused.27 We agree with the CA that Judge Daguna limited herself only to the following: (1) Columnas affidavit dated March 8, 2004 wherein he implicated the respondents in the murders; (2) his affirmation of this affidavit during the April 19, 2004 clarificatory hearing; (3) his letter dated October 29, 2004 and (4) the May 30, 2005 DOJ resolution upholding the prosecutors recommendation to file the murder charges.28 She completely ignored other relevant pieces of evidence such as: (1) Columnas May 3, 2004 letter to respondent Lloyd Antiporda narrating the torture he suffered to force him to admit his participation in the crimes and to implicate the respondents; (2) his May 25, 2004 affidavit where he stated that neither he nor the respondents had any involvement in the murders and (3) his testimony during the October 22, 2004 clarificatory hearing wherein he categorically affirmed his May 3, 2004 letter and May 25, 2004 affidavit. We declared in Jimenez v. Jimenez29 that [although] there is no general formula or fixed rule for the determination of probable cause since the same must be decided in the light of the conditions obtaining in given situations and its existence depends to a large degree upon the finding or opinion of the judge conducting the examination, such a finding should not disregard the facts before the judge nor run counter to the clear dictates of reason. The judge or fiscal, therefore, should not go on with the prosecution in the hope that some credible evidence might later turn up during trial for this would be a flagrant violation of a basic right which the courts are created to uphold.30 (Emphasis supplied) Had Judge Daguna reviewed the entire records of the investigation, she would have seen that, aside from the pieces of evidence she relied on, there were others which cast doubt on them. We quote with approval the reflections of the CA on this point: The selectivity of respondent RTC Judge for purposes of resolving the motion to withdraw the informationseffectively sidetracked the guidelines for an independent assessment and evaluation of the merits of the case. Respondent RTC Judge thus impaired the substantial rights of the accused. Instead, she should have made a circumspect evaluation by looking at everything made available to her at that point of the cases. No less than that was expected and required of her as a judicial officer. According to Santos v. Orda, Jr., the trial judge may make an independent assessment of the merits of the case based on the affidavits and counter-affidavits, documents, or evidence appended to the Information; the records of the public prosecutor which the court may order the latter to produce before the court; or any evidence already adduced before

the court by the accused at the time the motion is filed by the public prosecutor.31 Moreover, Judge Daguna failed to consider that Columnas extrajudicial confession in his March 8, 2004 affidavit was not admissible as evidence against respondents in view of the rule on res inter alios acta. Res inter alios acta alteri nocere non debet. The rule on res inter alios acta provides that the rights of a party cannot be prejudiced by an act, declaration, or omission of another.32 Consequently, an extrajudicial confession is binding only on the confessant, is not admissible against his or her coaccused33 and is considered as hearsay against them.34 The reason for this rule is that: on a principle of good faith and mutual convenience, a mans own acts are binding upon himself, and are evidence against him. So are his conduct and declarations. Yet it would not only be rightly inconvenient, but also manifestly unjust, that a man should be bound by the acts of mere unauthorized strangers; and if a party ought not to be bound by the acts of strangers, neither ought their acts or conduct be used as evidence against him.35 An exception to the res inter alios acta rule is an admission made by a conspirator under Section 30, Rule 130 of the Rules of Court: Admission by conspirator. The act or declaration of a conspirator relating to the conspiracy and during its existence, may be given in evidence against the co-conspirator after the conspiracy is shown by evidence other than such act or declaration.1avvphi1 This rule prescribes that the act or declaration of the conspirator relating to the conspiracy and during its existence may be given in evidence against coconspirators provided that the conspiracy is shown by independent evidence aside from the extrajudicial confession.36 Thus, in order that the admission of a conspirator may be received against his or her co-conspirators, it is necessary that (a) the conspiracy be first proved by evidence other than the admission itself (b) the admission relates to the common object and (c) it has been made while the declarant was engaged in carrying out the conspiracy.37 Otherwise, it cannot be used against the alleged co-conspirators without violating their constitutional right to be confronted with the witnesses against them and to cross-examine them.38 Here, aside from the extrajudicial confession, which was later on recanted, no other piece of evidence was presented to prove the alleged conspiracy. There was no other prosecution evidence, direct or circumstantial, which the extrajudicial confession could corroborate. Therefore, the recanted confession of Columna, which was the sole evidence against respondents, had no probative value and was inadmissible as evidence against them. Considering the paucity and inadmissibility of the evidence presented against the respondents, it would be unfair to hold them for trial. Once it is ascertained that no probable cause exists to form a sufficient belief as to the guilt of the accused, they should be relieved from the pain of going through a full blown

court case.39 When, at the outset, the evidence offered during the preliminary investigation is nothing more than an uncorroborated extrajudicial confession of an alleged conspirator, the criminal complaint should not prosper so that the system would be spared from the unnecessary expense of such useless and expensive litigation.40 The rule is all the more significant here since respondent Licerio Antiporda remains in detention for the murder charges pursuant to the warrant of arrest issued by Judge Daguna.41 Indeed, at that stage of the proceedings, the duty of Judge Daguna was only to satisfy herself whether there was probable cause or sufficient ground to hold respondents for trial as co-conspirators. Given that she had no sufficient basis for a finding of probable cause against respondents, her orders denying the withdrawal of the Informations for murder against them were issued with grave abuse of discretion. Hence, we hold that the CA committed no reversible error in granting the petitions for certiorari of respondents. WHEREFORE, the petition is hereby DENIED. No pronouncement as to costs. SO ORDERED.