1/20/2020 Case Digest: MACARIOLA V ASUNCION

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CASE DIGEST: MACARIOLA V ASUNCION

Published by arce on July 29, 2013 | Leave a response

MACARIOLA V ASUNCION

FACTS

Reyes siblings filed a complaint for partition against Macariola, concerning the properties
left by their common father, Francisco Reyes. Asuncion was the judge who rendered the
decision, which became final for lack of an appeal. A project of partition was submitted to
Judge Asuncion after the finality of the decision. This project of partition was only signed
by the counsel of the parties, who assured the judge that they were given authorization to
do so.
One of the properties in the project of partition was Lot 1184, which was subdivided into 5
lots. One of these lots (Lot 1184-D) was sold to Anota, a stenographer of the court, while
another (Lot 1184-E) was sold to Dr. Galapon, who later on sold a portion of the same lot
to Judge Asuncion and his wife. A year after, spouses Asuncion and Dr. Galapon sold
their respective shares over the lot to Traders Manufacturing and Fishing Industries. At
the time of the sale, Judge Asuncion and his wife were both stockholders, with Judge
Asuncion as President and his wife as secretary of said company.
A year after the company’s registration with the SEC, Macariola filed a complaint against
Judge Asuncion alleging: • that he violated Art. 1491 (5) of the Civil Code in acquiring a
portion of the lot, which was one of those properties involved in the partition case; and •
that he violated Art 14 (1 and 5) of the Code of Commerce, Sec 3 (H) of RA 3019, Sec 12,
Rule XVIII of the Civil Service Rules, and Canon 25 of the Canons of Judicial Ethics by
associating himself with a private company while he was a judge of the CFI of Leyte. This
case was referred to Justice Palma of the CA for investigation, report and
recommendation. After hearing, the said Investigating Justice recommended that Judge
Asuncion should be reprimanded or warned in connection with the complaints filed
against him.

ISSUE

1. Whether or not Judge Asuncion violated Art 1491 (5) of the Civil Code in acquiring
by purchase a portion of Lot 1184-E, which was among those properties involved in
the partition case.

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2. Whether or not Judge Asuncion violated Art 14 (1 and 5) of the Code of Commerce,
Sec 3 (H) of RA 3019, Sec 12, Rule XVIII of the Civil Service Rules and Canon 25 of
the Canons of Judicial Ethics when he associated himself with Traders
Manufacturing and Fishing Industries, Inc., as stockholder and a ranking officer

HELD

1. NO. Although Art 1491 (5) of the Civil Code prohibits justices, judges among others
from acquiring by purchase the property and rights in litigation or levied upon an
execution before the court, the SC has ruled, however, that for the prohibition to
operate, the sale or assignment of the property must take place during the pendency
of the litigation involving the property. In this case, when Judge Asuncion purchased
a portion of Lot 1184-E, the decision in the partition case was already final because
none of the parties filed an appeal within the reglementary period. Thus, the lot in
question was no longer subject of the litigation. Moreover, Judge Asuncion did NOT
buy the lot directly from the plaintiffs in the partition case but from Dr. Galapon, who
earlier purchased the lot from the plaintiffs. The subsequent sale from Dr. Galapon to
Judge Asuncion is NOT a scheme to conceal the illegal and unethical transfer of said
lot as a consideration for the approval of the project of partition. As pointed out by
the Investigating Justice, there is no evidence in the record showing that Dr. Galapon
acted as a mere dummy of Judge Asuncion. In fact, Dr. Galapon appeared to be a
respectable citizen, credible and sincere, having bought the subject lot in good faith
and for valuable consideration, without any intervention of Judge Asuncion.
Although Judge Asuncion did NOT violate Art 1491 (5) of the Civil Code, it was
IMPROPER for him to have acquired the lot in question. Canon 3 of the Canons of
Judicial Ethics requires that judges’ official conduct should be free from the
appearance of impropriety. It was unwise and indiscreet on the part of Judge
Asuncion to have purchased the property that was or had been in litigation in his
court and caused it to be transferred to a corporation of which he and his wife were
ranking officers at the time of such transfer. His actuations must not cause doubt and
mistrust in the uprightness of his administration of justice.
2. NO. Art 14 (1 and 5) of the Code of Commerce prohibits justices of the SC, judges
and officials of the department of public prosecution in active service from engaging
in commerce, either in person or proxy or from holding any office or have an direct,
administrative or financial intervention in commercial or industrial companies
within the limits of the territory in which they discharge their duties. However, this
Code is the Spanish Code of Commerce of 1885, which was extended to the
Philippines by a Royal Decree. Upon the transfer of sovereignty from Spain to the US
to the Philippines, Art 14 of the Code of Commerce must be deemed to have been
abrogated because where there is change of sovereignty, the political laws of the
former sovereign are automatically abrogated, unless they are expressly re-enacted
by affirmative act of the new sovereign. There appears to be no affirmative act that
continued the effectivity of said provision.
Sec 3 (H) of RA 3019 provides for instances when public officers are considered to
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have committed corrupt practices, which include having financial or pecuniary

interest in any business, contract or transaction in connection with which he
intervenes or takes part in his official capacity or in which he is prohibited by the
Constitution or by any law from having any interest. Judge Asuncion cannot be held
liable under said provision because there is no showing that he participated or
intervened in his official capacity in the business or transactions of Traders
Manufacturing. In this case, the business of the corporation in which he participated
has obviously no relation to his judicial office.
Sec 12, Rule XVIII of the Civil Service Rules does NOT apply to members of the
Judiciary, who are covered under RA 296 (Judiciary Act of 1948) and Art X (7) of the
1973 Constitution. Under Sec 67 of RA 296, the power to remove or dismiss judges is
vested in the President of the Philippines, not in the CSC, and only on 2 grounds—
serious misconduct and inefficiency. Under the 1973 Constitution, only the SC can
discipline judges of the inferior courts as well as other personnel of the Judiciary.
Judges cannot be considered as subordinate civil service officers or employees
because the Commissioner of the CSC is not the head of the Judiciary department.
Moreover, only permanent officers in the classified service are subject to the
jurisdiction of the CSC. Judges, however, are not within this classification, as they are
considered to be non-competitive or unclassified service of the government as a
Presidential appointee.
Canon 25 of the Canons of Judicial Ethics reminds judges to abstain from making
personal investments in enterprises, which are apt to be involved in litigation in his
court. Judge Asuncion and his wife, however, had withdrawn from the corporation
and sold their shares to third parties only 22 days after its incorporation, which
indicates that Judge Asuncion realized that their interest in the corporation
contravenes said Canon. The Court even commended the spouses for such act.

Administrative Subject Article Active Service Affirmative

RELATED ARTICLES:

Case Digest: Reyes v. Barretto- Case Digest: De Jesus v.

Datu (19 SCRA 85) Manglapus

Case Digest: CAPITOL STEEL Case Digest: MAHARLIKA

CORPORATION v. PHIVIDEC PUBLISHING CORP V TAGLE
INDUSTRIAL AUTHORITY
510 SCRA 590 (2006)

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1/20/2020 Case Digest: MACARIOLA V ASUNCION

Case Digest: RUBIO v PEOPLE’S Case Digest: JAVIER V. REYES

HOMESITE AND HOUSING
CORPORATION

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