G.R. Nos.
164368-69               April 2, 2009 Estrada was subsequently arrested on the basis of a warrant of arrest that the
PEOPLE OF THE PHILIPPINES, Petitioner,
vs.
JOSEPH EJERCITO ESTRADA and THE HONORABLE SPECIAL DIVISION OF
THE SANDIGANBAYAN, Respondents.
DECISION
BRION, J.:
The People of the Philippines (the People) filed this Petition for Review on
Certiorari1 to seek the reversal of the Sandiganbayan’s Joint Resolution dated July
12, 2004, granting respondent Joseph Ejercito Estrada’s (Estrada) demurrer to
evidence in Crim. Case No. 26565.2
THE FACTS
On April 4, 2001, an Information for plunder (docketed as Crim. Case No. 26558)
was filed with the Sandiganbayan against respondent Estrada, among other
accused. A separate Information for illegal use of alias, docketed as Crim. Case
No. 26565, was likewise filed against Estrada. The Amended Information in Crim.
Case No. 26565 reads:
That on or about 04 February 2000, or sometime prior or subsequent thereto, in
the City of Manila, Philippines and within the jurisdiction of this Honorable Court,
the above-named accused, being then President of the Republic of the Philippines,
without having been duly authorized, judicially or administratively, taking
advantage of his position and committing the offense in relation to office, i.e., in
order to CONCEAL THE ill-gotten wealth HE ACQUIRED during his tenure and his
true identity as THE President of the Republic of the Philippines, did then and
there, willfully, unlawfully and criminally REPRESENT HIMSELF AS ‘JOSE
VELARDE’ IN SEVERAL TRANSACTIONS AND use and employ the SAID alias
"Jose Velarde" which IS neither his registered name at birth nor his baptismal
name, in signing documents with Equitable PCI Bank and/or other corporate
entities.
CONTRARY TO LAW.
Crim. Case Nos. 26565 and 26558 were subsequently consolidated for joint trial.
Still another Information, this time for perjury and docketed as Crim. Case No.
26905, was filed with the Sandiganbayan against Estrada. This was later
consolidated, too, with Crim. Cases No. 26558 and 26565.
Sandiganbayan issued.
On January 11, 2005, we ordered the creation of a Special Division in the
Sandiganbayan to try, hear, and decide the charges of plunder and related cases
(illegal use of alias and perjury) against respondent Estrada.3
At the trial, the People presented testimonial and documentary evidence to prove
the allegations of the Informations for plunder, illegal use of alias, and perjury. The
People’s evidence for the illegal alias charge, as summarized by the
Sandiganbayan, consisted of:
A. The testimonies of Philippine Commercial and Industrial Bank (PCIB)
officers Clarissa G. Ocampo (Ocampo) and Atty. Manuel Curato (Curato)
who commonly declared that on February 4, 2000, Estrada opened a
numbered trust account (Trust Account C-163) with PCIB and signed as
"Jose Velarde" in the account opening documents; both Ocampo and
Curato also testified that Aprodicio Lacquian and Fernando Chua were
present on that occasion;
B. (1) The testimony of PCIB-Greenhills Branch Manager Teresa Barcelan,
who declared that a certain Baby Ortaliza (Ortaliza) transacted several
times with her; that Ortaliza deposited several checks in PCIB Savings
Account No. 0160-62502-5 under the account name "Jose Velarde" on the
following dates (as evidenced by deposit receipts duly marked in
evidence):
a. 20 October 1999 (Exh. "MMMMM")
b. 8 November 1999 (Exh. "LLLLL")
c. 22 November 1999 (Exh. "NNNNN")
d. 24 November 1999 (Exh. "OOOOO")
e. 25 November 1999 (Exh. "PPPPP")
f. 20 December 1999 (Exh. "QQQQQ")
g. 21 December 1999 (Exh. "RRRRR")
h. 29 December 1999 (Exh. "SSSSS")
 i. 4 January 2000 (Exh. "TTTTT")
j. 10 May 2000 (Exh. "UUUUU")
k. 6 June 2000 (Exh. "VVVVV")
l. 25 July 2000 (Exh. "WWWWW")
(2) Documents duly identified by witnesses showing that Lucena Ortaliza
was employed in the Office of the Vice President and, later on, in the
Office of the President when Estrada occupied these positions and when
deposits were made to the Jose Velarde Savings Account No. 0160-
62502-5.
The People filed its Formal Offer of Exhibits in the consolidated cases, which the
Sandiganbayan admitted into evidence in a Resolution dated October 13,
2003.4 The accused separately moved to reconsider the Sandiganbayan
Resolution;5 the People, on the other hand, filed its Consolidated
Comment/Opposition to the motions.6 The Sandiganbayan denied the motions in
its Resolution dated November 17, 2003.7
After the People rested in all three cases, the defense moved to be allowed to file
a demurrer to evidence in these cases.8 In its Joint Resolution dated March 10,
2004,9 the Sandiganbayan only granted the defense leave to file demurrers in
Crim. Case Nos. 26565 (illegal use of alias) and 26905 (perjury).
Estrada filed separate Demurrers to Evidence for Crim. Case Nos. 26565 and
26905.10 His demurrer to evidence for Crim. Case No. 26565 (illegal use of alias)
was anchored on the following grounds11:
1. Of the thirty-five (35) witnesses presented by the prosecution, only two
(2) witnesses, Ms. Clarissa Ocampo and Atty. Manuel Curato, testified that
on one occasion (4 February 2000), they saw movant use the name "Jose
Velarde";
2. The use of numbered accounts and the like was legal and was
prohibited only in late 2001 as can be gleaned from Bangko Sentral
Circular No. 302, series of 2001, dated 11 October 2001;
3. There is no proof of public and habitual use of alias as the documents
offered by the prosecution are banking documents which, by their nature,
are confidential and cannot be revealed without following proper
procedures; and
4. The use of alias is absorbed in plunder.
The People opposed the demurrers through a Consolidated Opposition that
presented the following arguments:12
1. That the use of fictitious names in bank transaction was not expressly
prohibited until BSP No. 302 is of no moment considering that as early as
Commonwealth Act No. 142, the use of alias was already prohibited.
Movant is being prosecuted for violation of C.A. No. 142 and not BSP
Circular No. 302;
2. Movant’s reliance on Ursua vs. Court of Appeals (256 SCRA 147
[1996]) is misplaced;
3. Assuming arguendo that C.A. No. 142, as amended, requires
publication of the alias and the habitual use thereof, the prosecution has
presented more than sufficient evidence in this regard to convict movant
for illegal use of alias; and
4. Contrary to the submission of movant, the instant case of illegal use of
alias is not absorbed in plunder.
Estrada replied to the Consolidated Opposition through a Consolidated Reply
Opposition.
THE ASSAILED SANDIGANBAYAN’S RULING
The Sandiganbayan issued on July 12, 2004 the Resolution now assailed in this
petition. The salient points of the assailed resolution are:
First – the coverage of Estrada’s indictment. The Sandiganbayan found that the
only relevant evidence for the indictment are those relating to what is described in
the Information – i.e., the testimonies and documents on the opening of Trust
Account C-163 on February 4, 2000. The Sandiganbayan reasoned out that the
use of the disjunctive "or" between "on or about 04 February 2000" and "sometime
prior or subsequent thereto" means that the act/s allegedly committed on February
4, 2000 could have actually taken place prior to or subsequent thereto; the use of
the conjunctive was simply the prosecution’s procedural tool to guard against any
variance between the date stated in the Information and that proved during the trial
in a situation in which time was not a material ingredient of the offense; it does not
mean and cannot be read as a roving commission that includes acts and/or events
separate and distinct from those that took place on the single date "on or about 04
February 2000 or sometime prior or subsequent thereto." The Sandiganbayan
ruled that the use of the disjunctive "or" prevented it from interpreting the
Information any other way.
Second – the People’s failure to present evidence that proved Estrada’s
commission of the offense. The Sandiganbayan found that the People failed to
present evidence that Estrada committed the crime punished under
Commonwealth Act No. 142, as amended by Republic Act (R.A.) No. 6085 (CA
142), as interpreted by the Supreme Court in Ursua v. Court of Appeals.13 It ruled
that there is an illegal use of alias within the context of CA 142 only if the use of
the alias is public and habitual. In Estrada’s case, the Sandiganbayan noted, the
application of the principles was not as simple because of the complications
resulting from the nature of the transaction involved – the alias was used in
connection with the opening of a numbered trust account made during the
effectivity of R.A. No. 1405, as amended,14 and prior to the enactment of Republic
R.A. No. 9160.15
Estrada did not publicly use the alias "Jose Velarde":
a. Estrada’s use of the alias "Jose Velarde" in his dealings with Dichavez
and Ortaliza after February 4, 2000 is not relevant in light of the conclusion
that the acts imputed to Estrada under the Information were the act/s
committed on February 4, 2000 only. Additionally, the phrase, "Estrada did
… represent himself as ‘Jose Velarde’ in several transactions," standing
alone, violates Estrada’s right to be informed of the nature and the cause
of the accusation, because it is very general and vague. This phrase is
qualified and explained by the succeeding phrase – "and use and employ
the said alias ‘Jose Velarde’" – which "is neither his registered name at
birth nor his baptismal name, in signing documents with Equitable PCI
Bank and/or other corporate entities." Thus, Estrada’s representations
before persons other than those mentioned in the Information are
immaterial; Ortaliza and Dichavez do not fall within the "Equitable PCI
Bank and/or other corporate entities" specified in the Information.
Estrada’s representations with Ortaliza and Dichavez are not therefore
covered by the indictment.
b. The Sandiganbayan rejected the application of the principle in the law of
libel that mere communication to a third person is publicity; it reasoned out
that that the definition of publicity is not limited to the way it is defined
under the law on libel; additionally, the application of the libel law definition
is onerous to the accused and is precluded by the ruling in Ursua that CA
No. 142, as a penal statute, should be construed strictly against the State
and favorably for the accused. It ruled that the definition under the law on
libel, even if it applies, considers a communication to a third person
covered by the privileged communication rule to be non-actionable.
Estrada’s use of the alias in front of Ocampo and Curato is one such
privileged communication under R.A. No. 1405, as amended. The
Sandiganbayan said:
Movant’s act of signing "Jose Velarde" in bank documents being
absolutely confidential, the witnessing thereof by bank officers who were
likewise sworn to secrecy by the same law cannot be considered as
‘public’ as to fall within the ambit of CA 142 as amended. On account of
the absolute confidentiality of the transaction, it cannot be said that movant
intended to be known by this name in addition to his real name.
Confidentiality and secrecy negate publicity. Ursua instructs:
Hence, the use of a fictitious name or a different name belonging to
another person in a single instance without any sign or indication that the
user intends to be known by this name in addition to his real name from
that day forth does not fall within the prohibition in C.A. No. 142 as
amended.
c. The Sandiganbayan further found that the intention not to be publicly
known by the name "Jose Velarde" is shown by the nature of a numbered
account – a perfectly valid banking transaction at the time Trust Account
C-163 was opened. The opening, too, of a numbered trust account, the
Sandiganbayan further ruled, did not impose on Estrada the obligation to
disclose his real identity – the obligation R.A. No. 6713 imposes is to file
under oath a statement of assets and liabilities.16 Reading CA No. 142,
R.A. No. 1405 and R.A. No. 6713 together, Estrada had the absolute
obligation to disclose his assets including the amount of his bank deposits,
but he was under no obligation at all to disclose the other particulars of the
bank account (such as the name he used to open it).
Third – the effect of the enactment of R.A. No. 9160.17 The Sandiganbayan said
that the absolute prohibition in R.A. No. 9160 against the use of anonymous
accounts, accounts under fictitious names, and all other similar accounts, is a
legislative acknowledgment that a gaping hole previously existed in our laws that
allowed depositors to hide their true identities. The Sandiganbayan noted that the
prohibition was lifted from Bangko Sentral ng Pilipinas (BSP) Circular No. 251
dated July 7, 2000 – another confirmation that the opening of a numbered trust
account was perfectly legal when it was opened on February 4, 2000.
The Sandiganbayan ruled that the provisions of CA No. 142, as interpreted in
Ursua, must necessarily be harmonized with the provisions of R.A. No.1405 and
R.A. No. 9160 under the principle that every statute should be construed in a way
that will harmonize it with existing laws. A reasonable scrutiny, the Sandiganbayan
said, of all these laws in relation to the present case, led it to conclude that the use
of an alias within the context of a bank transaction (specifically, the opening of a
numbered account made before bank officers) is protected by the secrecy
provisions of R.A. No. 1405, and is thus outside the coverage of CA No. 142 until
the passage into law of R.A. No. 9160.
THE PETITION
The People filed this petition raising the following issues:
1. Whether the court a quo gravely erred and abused its discretion in
dismissing Crim. Case No. 26565 and in holding that the use by
respondent Joseph Estrada of his alias "Jose Velarde" was not public
despite the presence of Messrs. Aprodicio Laquian and Fernando Chua on
4 February 2000;
2. Whether the court a quo gravely erred and abused its discretion in
dismissing Crim. Case No. 26565 and in holding that the use by
respondent Joseph Estrada of his alias "Jose Velarde" was allowable
under banking rules, despite the clear prohibition under Commonwealth
Act No. 142;
3. Whether the court a quo gravely erred and abused its discretion in
dismissing Crim. Case No. 26565 and in applying R.A. No. 1405 as an
exception to the illegal use of alias punishable under Commonwealth Act
No. 142;
4. Whether the alleged harmonization and application made by the court a
quo of R.A. No.1405 and Commonwealth Act No. 142 were proper;
5. Whether the court a quo gravely erred and abused its discretion in
limiting the coverage of the amended Information in Crim. Case No. 26565
to the use of the alias "Jose Velarde" by respondent Joseph Estrada on
February 4, 2000;
6. Whether the court a quo gravely erred and abused its discretion in
departing from its earlier final finding on the non-applicability of Ursua v.
Court of Appeals and forcing its application to the instant case.
THE COURT’S RULING
The petition has no merit.
The Law on Illegal Use of Alias and the Ursua Ruling
Sections 1 and 2 of CA No. 142, as amended, read:
Section 1. Except as a pseudonym solely for literary, cinema, television, radio or
other entertainment purposes and in athletic events where the use of pseudonym
is a normally accepted practice, no person shall use any name different from the
one with which he was registered at birth in the office of the local civil registry or
with which he was baptized for the first time, or in case of an alien, with which he
was registered in the bureau of immigration upon entry; or such substitute name as
may have been authorized by a competent court: Provided, That persons whose
births have not been registered in any local civil registry and who have not been
baptized, have one year from the approval of this act within which to register their
names in the civil registry of their residence. The name shall comprise the
patronymic name and one or two surnames.
Section 2. Any person desiring to use an alias shall apply for authority therefor in
proceedings like those legally provided to obtain judicial authority for a change of
name and no person shall be allowed to secure such judicial authority for more
than one alias. The petition for an alias shall set forth the person's baptismal and
family name and the name recorded in the civil registry, if different, his immigrant's
name, if an alien, and his pseudonym, if he has such names other than his original
or real name, specifying the reason or reasons for the desired alias. The judicial
authority for the use of alias, the Christian name and the alien immigrant's name
shall be recorded in the proper local civil registry, and no person shall use any
name or names other than his original or real name unless the same is or are duly
recorded in the proper local civil registry.
How this law is violated has been answered by the Ursua definition of an alias – "a
name or names used by a person or intended to be used by him publicly and
habitually usually in business transactions in addition to his real name by which he
is registered at birth or baptized the first time or substitute name authorized by a
competent authority." There must be, in the words of Ursua, a "sign or indication
that the user intends to be known by this name (the alias) in addition to his real
name from that day forth … [for the use of alias to] fall within the prohibition
contained in C.A. No. 142 as amended."18
Ursua further relates the historical background and rationale that led to the
enactment of CA No. 142, as follows:
The enactment of C.A. No. 142 was made primarily to curb the common practice
among the Chinese of adopting scores of different names and aliases which
created tremendous confusion in the field of trade. Such a practice almost
bordered on the crime of using fictitious names which for obvious reasons could
not be successfully maintained against the Chinese who, rightly or wrongly,
claimed they possessed a thousand and one names. C.A. No. 142 thus penalized
the act of using an alias name, unless such alias was duly authorized by proper
judicial proceedings and recorded in the civil register.19
Following the doctrine of stare decisis,20 we are guided by the Ursua ruling on how
the crime punished under CA No. 142 may be committed. Close adherence to this
ruling, in other words, is unavoidable in the application of and the determination of
criminal liability under CA No. 142.
Among the many grounds the People invokes to avoid the application of the Ursua
ruling proceeds from Estrada’s position in the government; at the time of the
commission of the offense, he was the President of the Republic who is required
by law to disclose his true name. We do not find this argument sufficient to justify a
distinction between a man on the street, on one hand, and the President of the
Republic, on the other, for purposes of applying CA No. 142. In the first place, the
law does not make any distinction, expressly or impliedly, that would justify a
differential treatment. CA No. 142 as applied to Estrada, in fact allows him to use
his cinema or screen name of Joseph Estrada, which name he has used even
when he was already the President of the Philippines. Even the petitioner has
acquiesced to the use of the screen name of the accused, as shown by the title of
the present petition. Additionally, any distinction we make based on the People’s
claim unduly prejudices Estrada; this is proscribed by the Ursua dictum that CA
No. 142, as a penal statute, should be construed strictly against the State and in
favor of the accused.21 The mode of violating CA No. 142 is therefore the same
whoever the accused may be.
The People also calls our attention to an earlier Sandiganbayan ruling (Resolution
dated February 6, 2002) denying Estrada’s motion to quash the Information. This
earlier Resolution effectively rejected the application of Ursua under the following
tenor:
The use of the term "alias" in the Amended Information in itself serves to bring this
case outside the ambit of the ruling in the case of Ursua v. Court of Appeals (256
SCRA 147 [1996]), on which the accused heavily relies in his motion to quash. The
term "alias" means "otherwise known as" (Webster Third New International
Dictionary, 1993 ed., p. 53). The charge of using an "alias" logically implies that
another name has been used publicly and habitually. Otherwise, he will not be
known by such name. In any case, the amended information adverts to "several
transactions" and signing of documents with the Equitable PCI Bank and/or other
corporate entities where the above-mentioned alias was allegedly employed by the
accused.
The facts alleged in the information are distinctly different from facts established in
the Ursua case where another name was used by the accused in a single instance
without any sign or indication that that [sic] he intended to be known from that day
by this name in addition to his real name.22
The People argues that the Sandiganbayan gravely abused its discretion in
applying Ursua notwithstanding this earlier final ruling on its non-applicability – a
ruling that binds the parties in the present case. The People thus claims that the
Sandiganbayan erred to the point of gravely abusing its discretion when it
resurrected the application of Ursua, resulting in the reversal of its earlier final
ruling.
We find no merit in this argument for two reasons. First, the cited Sandiganbayan
resolution is a mere interlocutory order – a ruling denying a motion to quash23 –
that cannot be given the attributes of finality and immutability that are generally
accorded to judgments or orders that finally dispose of the whole, of or particular
matters in, a case.24 The Sandiganbayan resolution is a mere interlocutory order
because its effects would only be provisional in character, and would still require
the issuing court to undertake substantial proceedings in order to put the
controversy to rest.25 It is basic remedial law that an interlocutory order is always
under the control of the court and may be modified or rescinded upon sufficient
grounds shown at any time before final judgment.26 Perez v. Court of
Appeals,27 albeit a civil case, instructively teaches that an interlocutory order
carries no res adjudicata effects. Says Perez:
The Decision in CA-G.R. No. 10415 having resolved only an interlocutory matter,
the principle of res judicata  cannot be applied in this case. There can be no res
judicata where the previous order in question was not an order or judgment
determinative of an issue of fact pending before the court but was only an
interlocutory order because it required the parties to perform certain acts for final
adjudication. In this case, the lifting of the restraining order paved the way for the
possession of the fishpond on the part of petitioners and/or their representatives
pending the resolution of the main action for injunction. In other words, the main
issue of whether or not private respondent may be considered a sublessee or a
transferee of the lease entitled to possess the fishpond under the circumstances of
the case had yet to be resolved when the restraining order was lifted.28
Second, in the earlier motion to quash, the Sandiganbayan solely looked at the
allegations of the Information to determine the sufficiency of these allegations and
did not consider any evidence aliunde. This is far different from the present
demurrer to evidence where the Sandiganbayan had a fuller view of the
prosecution’s case, and was faced with the issue of whether the prosecution’s
evidence was sufficient to prove the allegations of the Information. Under these
differing views, the Sandiganbayan may arrive at a different conclusion on the
application of Ursua, the leading case in the application of CA 142, and the change
in ruling is not per se indicative of grave abuse of discretion. That there is no error
of law is strengthened by our consideration of the Sandiganbayan ruling on the
application of Ursua.
In an exercise of caution given Ursua’s jurisprudential binding effect, the People
also argues in its petition that Estrada’s case is different from Ursua’s for the
following reasons: (1) respondent Estrada used and intended to continually use the
alias "Jose Velarde" in addition to the name "Joseph Estrada"; (2) Estrada’s use of
the alias was not isolated or limited to a single transaction; and (3) the use of the
alias "Jose Velarde" was designed to cause and did cause "confusion and fraud in
business transactions" which the anti-alias law and its related statutes seek to
prevent. The People also argues that the evidence it presented more than satisfied
the requirements of CA No. 142, as amended, and Ursua, as it was also shown or
established that Estrada’s use of the alias was public.
In light of our above conclusions and based on the parties’ expressed positions,
we shall now examine within the Ursua framework the assailed Sandiganbayan
Resolution granting the demurrer to evidence. The prosecution has the burden of
proof to show that the evidence it presented with the Sandiganbayan satisfied the
Ursua requirements, particularly on the matter of publicity and habituality in the use
of an alias.
What is the coverage of the indictment?
The People argues that the Sandiganbayan gravely erred and abused its
discretion in limiting the coverage of the amended Information in Crim. Case No.
26565 to Estrada’s use of the alias "Jose Velarde" on February 4, 2000. It posits
that there was a main transaction – one that took place on February 4, 2000 – but
there were other transactions covered by the phrase "prior to or subsequent
thereto; the Information specifically referred to "several transactions" … "with
Equitable PCI Bank and/or other corporate entities." To the People, the restrictive
finding – that the phrase "prior to or subsequent thereto" is absorbed by the phrase
"on or about 04 February 2000" – drastically amends the succeeding main
allegations on the constitutive criminal acts by removing the plurality of both the
transactions involved and the documents signed with various entities; there is the
undeniable essential relationship between the allegations of the multiplicity of
transactions, on one hand, and the additional antecedent of "prior to or subsequent
thereto," on the other. It argues that the Sandiganbayan reduced the phrase "prior
to or subsequent thereto" into a useless appendage, providing Estrada with a
convenient and totally unwarranted escape route.
The People further argues that the allegation of time is the least exacting in
satisfying the constitutional requirement that the accused has to be informed of the
accusation against him. Section 6 of Rule 110 of the Revised Rules of Court
provides that an allegation of the approximate date of the commission of the
offense will suffice, while Section 11 of the same Rule provides that it is not
necessary to state in the complaint or information the precise date the offense was
committed except when it is a material ingredient of the crime. This liberality
allegedly shaped the time-tested rule that when the "time" given in the complaint is
not of the essence of the offense, the time of the commission of the offense does
not need to be proven as alleged, and that the complaint will be sustained if the
proof shows that the offense was committed at any time within the period of the
statute of limitations and before the commencement of the action (citing People v.
Bugayong [299 SCRA 528, 537] that in turn cited US v. Smith [3 Phil. 20, 22]).
Since allegations of date of the commission of an offense are liberally interpreted,
the People posits that the Sandiganbayan gravely abused its discretion in
disregarding the additional clause "prior to or subsequent thereto"; under the
liberality principle, the allegations of the acts constitutive of the offense finally
determine the sufficiency of the allegations of time. The People thus claims that no
surprise could have taken place that would prevent Estrada from properly
defending himself; the information fully notified him that he was being accused of
using the alias Jose Velarde in more than just one instance.
We see no merit in these arguments.
At its core, the issue is constitutional in nature – the right of Estrada to be informed
of the nature and cause of the accusation against him. Under the provisions of the
Rules of Court implementing this constitutional right, a complaint or information is
sufficient if it states the name of the accused; the designation of the offense given
by the statute; the acts or omissions complained of as constituting the offense in
the name of the offended party; the approximate date of the commission of the
offense; and the place where the offense was committed.29 As to the cause of
accusation, the acts or omissions complained of as constituting the offense and
the qualifying and aggravating circumstances must be stated in ordinary and
concise language and not necessarily in the language used in the statute, but in
terms sufficient to enable a person of common understanding to know the offense
charged and the qualifying and aggravating circumstances, and for the court to
pronounce judgment.30 The date of the commission of the offense need not be
precisely stated in the complaint or information except when the precise date is a
material ingredient of the offense. The offense may be alleged to have been
committed on a date as near as possible to the actual date of its commission.31
The information must at all times embody the essential elements of the crime
charged by setting forth the facts and circumstances that bear on the culpability
and liability of the accused so that he can properly prepare for and undertake his
defense.32 In short, the allegations in the complaint or information, as written, must
fully inform or acquaint the accused – the primary reader of and the party directly
affected by the complaint or information – of the charge/s laid.
The heretofore cited Information states that "… on or about 04 February 2000, or
sometime prior or subsequent thereto, in the City of Manila, Philippines and within
the jurisdiction of this Honorable Court, the above-named accused [did] … willfully,
unlawfully and criminally REPRESENT HIMSELF AS ‘JOSE VELARDE’ IN
SEVERAL TRANSACTIONS AND use and employ the SAID alias "Jose Velarde"
which IS neither his registered name at birth nor his baptismal name, in signing
documents with Equitable PCI Bank and/or other corporate entities."
We fully agree with the disputed Sandiganbayan’s reading of the Information, as
this was how the accused might have similarly read and understood the allegations
in the Information and, on this basis, prepared his defense. Broken down into its
component parts, the allegation of time in the Information plainly states that (1) ON
February 4, 2000; (2) OR before February 4, 2000; (3) OR sometime prior or
subsequent to February 4, 2000, in the City of Manila, Estrada represented himself
as "Jose Velarde" in several transactions in signing documents with Equitable PCI
Bank and/or other corporate entities.
Under this analysis, the several transactions involving the signing of documents
with Equitable PCI Bank and/or other corporate entities all had their reference to
February 4, 2000; they were all made on or about or prior or subsequent to that
date, thus plainly implying that all these transactions took place only on February
4, 2000 or on another single date sometime before or after February 4, 2000. To
be sure, the Information could have simply said "on or about February 4, 2000" to
capture all the alternative approximate dates, so that the phrase "sometime prior or
subsequent thereto" would effectively be a surplusage that has no meaning
separately from the "on or about" already expressed. This consequent uselessness
of the "prior or subsequent thereto" phrase cannot be denied, but it is a direct and
necessary consequence of the use of the "OR" between the two phrases and the
"THERETO" that referred back to February 4, 2000 in the second phrase. Of
course, the reading would have been very different (and would have been clearly
in accord with the People’s present interpretation) had the Information simply used
"AND" instead of "OR" to separate the phrases; the intent to refer to various
transactions occurring on various dates and occasions all proximate to February 4,
2000 could not be disputed. Unfortunately for the People, the imprecision in the
use of "OR" is the reality the case has to live with. To act contrary to this reality
would violate Estrada’s right to be informed of the nature and cause of accusation
against him; the multiple transactions on several separate days that the People
claims would result in surprise and denial of an opportunity to prepare for Estrada,
who has a right to rely on the single day mentioned in the Information.
Separately from the constitutional dimension of the allegation of time in the
Information, another issue that the allegation of time and our above conclusion
raise relates to what act or acts, constituting a violation of the offense charged,
were actually alleged in the Information.1avvphi1
The conclusion we arrived at necessarily impacts on the People’s case, as it deals
a fatal blow on the People’s claim that Estrada habitually used the Jose Velarde
alias. For, to our mind, the repeated use of an alias within a single day cannot be
deemed "habitual," as it does not amount to a customary practice or use. This
reason alone dictates the dismissal of the petition under CA No. 142 and the terms
of Ursua.
The issues of publicity, numbered accounts, and
the application of CA No. 142, R.A. No. 1405,
and R.A. No. 9160.
We shall jointly discuss these interrelated issues.
The People claims that even on the assumption that Ocampo and Curato are bank
officers sworn to secrecy under the law, the presence of two other persons who
are not bank officers – Aprodicio Laquian and Fernando Chua – when Estrada’s
signed the bank documents as "Jose Velarde" amounted to a "public" use of an
alias that violates CA No. 142.
On the issue of numbered accounts, the People argues that to premise the validity
of Estrada’s prosecution for violation of CA No. 142 on a mere banking practice is
gravely erroneous, improper, and constitutes grave abuse of discretion; no banking
law provision allowing the use of aliases in the opening of bank accounts existed;
at most, it was allowed by mere convention or industry practice, but not by a
statute enacted by the legislature. Additionally, that Estrada’s prosecution was
supposedly based on BSP Circular No. 302 dated October 11, 2001 is wrong and
misleading, as Estrada stands charged with violation of CA No. 142, penalized
since 1936, and not with a violation of a mere BSP Circular. That the use of alias in
bank transactions prior to BSP Circular No. 302 is allowed is inconsequential
because as early as CA No. 142, the use of an alias (except for certain purposes
which do not include banking) was already prohibited. Nothing in CA No. 142
exempted the use of aliases in banking transactions, since the law did not
distinguish or limit its application; it was therefore grave error for the
Sandiganbayan to have done so. Lastly on this point, bank regulations being mere
issuances cannot amend, modify or prevail over the effective, subsisting and
enforceable provision of CA No. 142.
On the issue of the applicability of R.A. No. 1405 and its relationship with CA No.
142, that since nothing in CA No. 142 excuses the use of an alias, the
Sandiganbayan gravely abused its discretion when it ruled that R.A. No. 1405 is an
exception to CA No. 142’s coverage. Harmonization of laws, the People posits, is
allowed only if the laws intended to be harmonized refer to the same subject
matter, or are at least related with one another. The three laws which the
Sandiganbayan tried to harmonize are not remotely related to one another; they
each deal with a different subject matter, prohibits a different act, governs a
different conduct, and covers a different class of persons,33 and there was no need
to force their application to one another. Harmonization of laws, the People adds,
presupposes the existence of conflict or incongruence between or among the
provisions of various laws, a situation not obtaining in the present case.
The People posits, too, that R.A. No. 1405 does not apply to trust transactions,
such as Trust Account No. C-163, as it applies only to traditional deposits (simple
loans). A trust account, according to the People, may not be considered a deposit
because it does not create the juridical relation of creditor and debtor; trust and
deposit operations are treated separately and are different in legal contemplation;
trust operation is separate and distinct from banking and requires a grant of
separate authority, and trust funds are not covered by deposit insurance under the
Philippine Deposit Insurance Corporation law (R.A. No. 3591, as amended).
The People further argues that the Sandiganbayan’s conclusion that the
transaction or communication was privileged in nature was erroneous – a
congruent interpretation of CA No. 142 and R.A. No. 1405 shows that a person
who signs in a public or private transaction a name or alias, other than his original
name or the alias he is authorized to use, shall be held liable for violation of CA
No. 142, while the bank employees are bound by the confidentiality of bank
transactions except in the circumstances enumerated in R.A. No. 1405. At most,
the People argues, the prohibition in R.A. No. 1405 covers bank employees and
officers only, and not Estrada; the law does not prohibit Estrada from disclosing
and making public his use of an alias to other people, including Ocampo and
Curato, as he did when he made a public exhibit and use of the alias before
Messrs. Lacquian and Chua.
Finally, the People argues that the Sandiganbayan ruling that the use of an alias
before bank officers does not violate CA No. 142 effectively encourages the
commission of wrongdoing and the concealment of ill-gotten wealth under
pseudonyms; it sustains an anomalous and prejudicial policy that uses the law to
silence bank officials and employees from reporting the commission of crimes. The
People contends that the law – R.A. No. 1405 – was not intended by the
Legislature to be used as a subterfuge or camouflage for the commission of crimes
and cannot be so interpreted; the law can only be interpreted, understood and
applied so that right and justice would prevail.
We see no merit in these arguments.
We agree, albeit for a different reason, with the Sandiganbayan position that the
rule in the law of libel – that mere communication to a third person is publicity –
does not apply to violations of CA No. 142. Our close reading of Ursua –
particularly, the requirement that there be intention by the user to be culpable and
the historical reasons we cited above – tells us that the required publicity in the use
of alias is more than mere communication to a third person; the use of the alias, to
be considered public, must be made openly, or in an open manner or place, or to
cause it to become generally known. In order to be held liable for a violation of CA
No. 142, the user of the alias must have held himself out as a person who shall
publicly be known under that other name. In other words, the intent to publicly use
the alias must be manifest.
To our mind, the presence of Lacquian and Chua when Estrada signed as Jose
Velarde and opened Trust Account No. C-163 does not necessarily indicate his
intention to be publicly known henceforth as Jose Velarde. In relation to Estrada,
Lacquian and Chua were not part of the public who had no access to Estrada’s
privacy and to the confidential matters that transpired in Malacañan where he sat
as President; Lacquian was the Chief of Staff with whom he shared matters of the
highest and strictest confidence, while Chua was a lawyer-friend bound by his oath
of office and ties of friendship to keep and maintain the privacy and secrecy of his
affairs. Thus, Estrada could not be said to have intended his signing as Jose
Velarde to be for public consumption by the fact alone that Lacquian and Chua
were also inside the room at that time. The same holds true for Estrada’s alleged
representations with Ortaliza and Dichavez, assuming the evidence for these
representations to be admissible. All of Estrada’s representations to these people
were made in privacy and in secrecy, with no iota of intention of publicity.
The nature, too, of the transaction on which the indictment rests, affords Estrada a
reasonable expectation of privacy, as the alleged criminal act related to the
opening of a trust account – a transaction that R.A. No. 1405 considers absolutely
confidential in nature.34 We previously rejected, in Ejercito v. Sandiganbayan,35 the
People’s nitpicking argument on the alleged dichotomy between bank deposits and
trust transactions, when we said:
The contention that trust accounts are not covered by the term "deposits," as used
in R.A. 1405, by the mere fact that they do not entail a creditor-debtor relationship
between the trustor and the bank, does not lie. An examination of the law shows
that the term "deposits" used therein is to be understood broadly and not limited
only to accounts which give rise to a creditor-debtor relationship between the
depositor and the bank.
The policy behind the law is laid down in Section 1:
SECTION 1. It is hereby declared to be the policy of the Government to give
encouragement to the people to deposit their money in banking institutions and to
discourage private hoarding so that the same may be properly utilized by banks in
authorized loans to assist in the economic development of the country.
(Underscoring supplied)
If the money deposited under an account may be used by bank for authorized
loans to third persons, then such account, regardless of whether it creates a
creditor-debtor relationship between the depositor and the bank, falls under the
category of accounts which the law precisely seeks to protect for the purpose of
boosting the economic development of the country.
Trust Account No. 858 is, without doubt, one such account. The Trust Agreement
between petitioner and Urban Bank provides that the trust account covers "deposit,
placement or investment of funds" by Urban Bank for and in behalf of petitioner.
The money deposited under Trust Account No. 858, was, therefore, intended not
merely to remain with the bank but to be invested by it elsewhere. To hold that this
type of account is not protected by R.A. 1405 would encourage private hoarding of
funds that could otherwise be invested by bank in other ventures, contrary to the
policy behind the law.
Section 2 of the same law in fact even more clearly shows that the term "deposits"
was intended to be understood broadly:
SECTION 2. All deposits of whatever nature with bank or banking institutions in
the Philippines including investments in bonds issued by the Government of the
Philippines, its political subdivisions and its instrumentalities, are hereby
considered as of an absolutely confidential nature and may not be examined,
inquired or looked into by any person, government official, bureau or
office, except upon written permission of the depositor, or in cases of
impeachment, or upon order of a competent court in cases of bribery or dereliction
of duty of public officials, or in cases where the money deposited or invested is
the subject matter of the litigation. (Emphasis and underscoring supplied)1avvphi1
The phrase "of whatever nature" proscribes any restrictive interpretation of
"deposits." Moreover, it is clear from the immediately quoted provision that,
generally, the law applies not only to money which is deposited but also to those
which are invested. This further shows that the law was not intended to apply only
to "deposits" in the strict sense of the word.lawphil.net Otherwise, there would
have been no need to add the phrase "or invested.
Clearly, therefore, R.A. 1405 is broad enough to cover Trust Account No. 858.36
We have consistently ruled that bank deposits under R.A. No. 1405 (the Secrecy
of Bank Deposits Law) are statutorily protected or recognized zones of
privacy.37 Given the private nature of Estrada’s act of signing the documents as
"Jose Velarde" related to the opening of the trust account, the People cannot claim
that there was already a public use of alias when Ocampo and Curato witnessed
the signing. We need not even consider here the impact of the obligations imposed
by R.A. No.1405 on the bank officers; what is essentially significant is the privacy
situation that is necessarily implied in these kinds of transactions. This statutorily
guaranteed privacy and secrecy effectively negate a conclusion that the
transaction was done publicly or with the intent to use the alias publicly.
The enactment of R.A. No.9160, on the other hand, is a significant development
only because it clearly manifests that prior to its enactment, numbered accounts or
anonymous accounts were permitted banking transactions, whether they be
allowed by law or by a mere banking regulation. To be sure, an indictment against
Estrada using this relatively recent law cannot be maintained without violating the
constitutional prohibition on the enactment and use of ex post facto laws.38
We hasten to add that this holistic application and interpretation of these various
laws is not an attempt to harmonize these laws. A finding of commission of the
offense punished under CA No. 142 must necessarily rest on the evidence of the
requisites for culpability, as amplified in Ursua. The application of R.A. No. 1405 is
significant only because Estrada’s use of the alias was pursuant to a transaction
that the law considers private or, at the very least, where the law guarantees a
reasonable expectation of privacy to the parties to the transactions; it is at this
point that R.A. No. 1405 tangentially interfaces with an indictment under CA 142.
In this light, there is no actual frontal clash between CA No. 142 and R.A. No. 1405
that requires harmonization. Each operates within its own sphere, but must
necessarily be read together when these spheres interface with one another.
Finally, R.A. No. 9160, as a law of recent vintage in relation to the indictment
against Estrada, cannot be a source or an influencing factor in his indictment.
In finding the absence of the requisite publicity, we simply looked at the totality of
the circumstances obtaining in Estrada’s use of the alias "Jose Velarde" vis-à-vis
the Ursua requisites. We do not decide here whether Estrada’s use of an alias
when he occupied the highest executive position in the land was valid and legal;
we simply determined, as the Sandiganbayan did, whether he may be made liable
for the offense charged based on the evidence the People presented. As with any
other accused, his guilt must be based on the evidence and proof beyond
reasonable doubt that a finding of criminal liability requires. If the People fails to
discharge this burden, as they did fail in this case, the rule of law requires that we
so declare. We do so now in this review and accordingly find no reversible error of
law in the assailed Sandiganbayan ruling.WHEREFORE, premises considered, we
DENY the petition for lack of merit.SO ORDERED.
G.R. No. 162187 November 18, 2005
CRISTE B. VILLANUEVA, Petitioner,
vs.
THE HON. SECRETARY OF JUSTICE and HORST-KESSLER VON
SPRENGEISEN, Respondents.
 DECISION
CALLEJO, SR., J.:
Before the Court is a petition for review on certiorari of the Decision1 of the Court of
Appeals (CA) in CA-G.R. SP No. 76999 dismissing the petition
for certiorari assailing the finding of the Secretary of Justice that no probable cause
exists against private respondent Horst-Kessler Von Sprengeisen for perjury.
The Antecedents
On April 2, 1996, the Refractories Corporation of the Philippines (RCP) filed a
protest before the Special Committee on Anti-Dumping of the Department of
Finance against certain importations of Hamburg Trading Corporation (HTC), a
corporation duly organized and existing under the laws of the Philippines. The
matter involved 151.070 tons of magnesite-based refractory bricks from
Germany.2 The case was docketed as Anti-Dumping Case No. I-98.
The protest was referred to the Bureau of Import Services (BIS) of the Department
of Trade and Industry, to determine if there was a prima facie case for violation of
Republic Act (R.A.) No. 7843, the Anti-Dumping Law. Sometime in February 1997,
the BIS submitted its report to the Tariff Commission, declaring that a prima
facie case existed and that continued importation of refractory bricks from
Germany would harm the local industry. It adopted the amount of DM 1,200 per
metric ton as the normal value of the imported goods.3
The HTC received a copy of the said report on February 14, 1997. However,
before it could respond, the chairman of the Tariff Commission prodded the parties
to settle the matter amicably. A conference ensued between RCP Senior Vice
President and Assistant General Manager Criste Villanueva and Jesus Borgonia,
on the one hand, and HTC President and General Manager Horst-Kessler Von
Sprengeisen and Sales Manager Dennis Gonzales, on the other. During the
conference, the parties agreed that the refractory bricks were imported by the HTC
at a price less than its normal value of DM 1,200, and that such importation was
likely to injure the local industry. The parties also agreed to settle the case to avoid
expenses and protracted litigation. HTC was required to reform its price
policy/structure of its importation and sale of refractory bricks from Germany to
conform to the provisions of R.A. No. 7843 and its rules and regulations. Jesus
Borgonio thereafter prepared and signed a compromise agreement containing the
terms agreed upon which Villanueva and Borgonia signed.4 Bienvenido Flores, an
Office Clerk of RCP, delivered the agreement to HTC at the 9th Floor of Ramon
Magsaysay Center Building, 1680 Roxas Boulevard, Manila by Von Sprengeisen’s
approval.5
However, Von Sprengeisen did not sign the agreement. Borgonia revised the
agreement by inserting the phrase "based on the findings of the BIS" in paragraph
1 thereof. Villanueva and Borgonia signed the agreement and had the same
delivered to the office of HTC on April 22, 1997 by Lino M. Gutierrez, a technical
assistant of RCP. Gonzales received the agreement and delivered the same to
Von Sprengeisen. After 20 minutes, Gonzales returned, with the agreement
already signed by Von Sprengeisen.6 Gonzales, who had also signed, then gave it
to Gutierrez. On the same day, Notary Public Zenaida P. De Zuñiga notarized the
agreement.7 Gonzales delivered a copy of the notarized Agreement to HTC.8
RCP submitted the compromise agreement to the Tariff Commission. During the
May 9, 1997 hearing before the Commission for the approval of the agreement, a
representative of HTC appeared. He offered no objection to the Agreement. The
Commission submitted its report to the Special Committee which rendered a
decision declaring that, based on the findings of the BIS, the normal value of the
imported refractory bricks was DM 1,200 per metric ton. HTC received a copy of
the decision on March 4, 1998. Neither RCP nor HTC appealed the decision to the
Court of Tax Appeals.
In the meantime, HTC imported refractory bricks from Germany anew and noted
that the normal value of the said importation under the decision of the Special
Committee based on the BIS report was DM 1,200 per metric ton. On July 28,
1998, the HTC filed an Urgent Motion to Set Aside and/or Vacate Judgment with
the Special Committee on Anti-Dumping, praying that such decision be declared
null and void on the following grounds:
1. THE FRAUD HAD BEEN COMMITTED BY THE PROTESTANT DURING THE
NEGOTIATION FOR THE PREPARATION OF THE COMPROMISE
AGREEMENT.
2. THAT INSERTIONS AND/OR SUBSTITUTION OF THE FACTS NOT AGREED
UPON WAS DELIBERATELY AND SURREPTITIOUSLY MADE BY THE
PROTESTANT IN THE COMPROMISE AGREEMENT WITHOUT THE
KNOWLEDGE AND CONSENT OF THE PROTESTEE.9
The motion was verified by Von Sprengeisen. The HTC averred therein that
Villanueva violated Article 172 of the Revised Penal Code when he surreptitiously
inserted the phrase "based on the findings of the BIS" in the agreement without the
knowledge and consent of Von Sprengeisen and despite their agreement to put
behind them the findings of the BIS. Appended to the motion was an Affidavit of
Merit executed by Von Sprengeisen in which he alleged, inter alia, that sometime
in February 1997, the BIS came out with its Report declaring that the normal value
of the magnesite-based refractory bricks was DM 1,200 per metric ton; before
HTC could respond to the report, Villanueva invited him to a conference for the
purpose of finding the best solution to the pending case before the Commission;
he and Gonzales attended the meeting during which it was agreed, by way of a
compromise, that the parties will accept the amount of DM 1,050 per metric ton as
the normal value for all magnesite-based refractory bricks from Germany; when he
received the draft of the compromise agreement prepared by Villanueva, he
approved the same; subsequently, Villanueva transmitted a compromise
agreement already signed by him to Von Sprengeisen for his review, approval and
signature; believing that the compromise agreement reproduced the contents of
the first compromise agreement, he signed the second agreement without reading
it; when he received, on March 4, 1998, a copy of the decision of the Tariff
Commission based on the compromise agreement of the parties wherein the
committee adopted the findings and recommendations of the BIS (that the normal
value of the shipment was DM 1,200 per metric ton), he was shocked because he
never agreed to the use of such findings for the reformation of its price policies;
there was, in fact, an agreement between him and Villanueva to put behind them
the findings of the BIS; he called up Villanueva at his office but failed to contact
him despite several attempts; suspecting that something amiss happened, he had
the draft of the first compromise agreement retrieved but his secretary failed to
locate the same; it was only sometime later that his secretary found the folder-file
containing the draft and was appalled to discover that Villanueva had substantially
altered the first draft of the compromise agreement; this made him conclude and
confirm his suspicion that Villanueva, thru deceit and fraud, induced him to sign the
compromise agreement to the prejudice of the HTC.10
The RCP opposed the motion. But, in a parallel move, Villanueva, in his capacity
as Senior Vice President and Assistant General Manager of RCP, filed a criminal
complaint for perjury against Von Sprengeisen in the Office of the City Prosecutor
of Manila. Appended thereto was a complaint-affidavit executed by Villanueva
wherein he declared, inter alia, that Von Sprengeisen made the following false
statements in the Urgent Motion, thus:
a. [Complainant] was the one who called up his office, inviting him to a meeting for
the purpose of finding the best and most equitable solution to the case (p. 3,
Urgent Motion);
b. RCP and Hamburg Trading agreed to put behind them the findings and
recommendations of the Bureau of Import Services (BIS) with respect to the anti-
dumping protest filed by RCP (p. 3, Urgent Motion);
c. The original version of the Compromise Agreement sent to him was merely a
draft (p. 3, Urgent Motion);
d. The phrase "based on the findings of the Bureau of Import Services" was
inserted in paragraph 1 of the final Compromise Agreement without his knowledge
and consent (p. 3, Urgent Motion); and
e. [Complainant] was the one who surreptitiously inserted the aforesaid phrase (p.
3, Urgent Motion).11
Villanueva also alleged that Von Sprengeisen made the following false statements
in his Affidavit of Merit:
a. [Complainant] invited him to a conference for the purpose of finding the best
solution to the case;
b. [Complainant and he] agreed to put behind [them] the findings and
recommendation of the BIS submitted to the Secretary of Finance;
c. We agreed to the amount of DM 1,050/ton as the normal value for all magnesite-
based refractory bricks from Germany;
d. The original version of the Compromise Agreement sent to him was merely a
draft; and
e. Through deceit and fraud, [complainant] induced [respondent] to sign the final
Compromise Agreement.12
In his Counter-Affidavit, Von Sprengeisen averred that whoever called the other for
a conference was not a material matter. Since the first draft of the Compromise
Agreement transmitted to him was by fax, he asked the complainant to send to him
the hard copy of the Agreement for his signature. He further narrated that when he
received the hard copy of the compromise agreement, he did not bother to review
since he assumed that it contained the same provisions in the faxed copy. He did
not suggest that the phrase "based on the findings of the BIS" be inserted in the
hard copy of the agreement because he and Villanueva were at odds on the BIS
finding the normal price of the goods was DM 1,200 per metric ton. He insisted that
it would have been senseless of him to agree to such insertion; as such, he did not
make any willful and deliberate assertion of any falsehood as to any material fact.13
Investigating Prosecutor Francisco G. Supnet found no probable cause for perjury
against the private respondent and recommended the dismissal of the complaint.
Second Assistant City Prosecutor Leoncia Dimagiba reviewed the resolution of
Prosecutor Supnet and found probable cause for perjury against the private
respondent for alleging in his Affidavit of Merit
that he was induced to sign the compromise agreement through fraud and deceit.
According to the Second Assistant City Prosecutor, the allegation of the private
respondent "thru deceit and fraud to sign the final Compromise Agreement" was a
deliberate assertion of a falsehood, designed as it was merely to give the BIS the
impression that private respondent was misled into agreeing to the compromise
agreement. She further opined that the allegation was perjurious, considering that
the private respondent had sufficient time to pass upon the Compromise
Agreement and could have availed the services of legal minds who could review
the terms and conditions thereof before signing the same;14 hence, she
recommended the reversal of Prosecutor Supnet’s resolution and the filing of the
information. The City Prosecutor approved the recommendation of the Second
Assistant City Prosecutor. Accordingly, an Information for perjury was filed against
the private respondent with the Metropolitan Trial Court of Manila.
The private respondent appealed the resolution to the Secretary of Justice, who
reversed the resolution of the City Prosecutor on September 20, 2002. According
to the Justice Secretary, the complainant failed to establish the materiality of the
alleged false assertions and that the said assertions were willful and deliberate.
Moreover, the allegations in the Affidavit of Merit are not altogether false since the
intention of the parties in executing the compromise agreement was precisely to
put behind the ruling of the BIS, despite which the complainant inserted the
condition that the parties would be bound by such findings and
recommendations.15 The decretal portion of the resolution reads:
WHEREFORE, the appealed resolution of the City Prosecutor of Manila is hereby
REVERSED. The City Prosecutor is directed to withdraw the information for
perjury against respondent Horst-Kessler von Sprengeisen and to report the action
taken within ten (10) days from receipt hereof.
SO ORDERED.16
Villanueva then filed a petition for certiorari with the CA assailing the resolution of
the Justice Secretary, alleging therein that grave abuse of discretion, amounting to
excess or lack of jurisdiction, was committed in issuing the said resolution.17 The
private respondent, for his part, sought the dismissal of the petition alleging that,
as found by the Justice Secretary, there was no probable cause against him for
perjury.18
On February 13, 2004, the CA dismissed the petition and affirmed the resolution of
the Justice Secretary.19
The CA declared that, as posited by the Office of the Solicitor General in its
comment on the petition, the parties had agreed to put behind them the findings
and recommendations of the BIS with respect to the anti-dumping protest. The
appellate court stated that its finding is buttressed by the fact that the amount of
DM 1,050 was not mentioned in the first compromise agreement and that, under
such agreement, the HTC obliged itself "to reform
its pricing policy and structure with respect to refractory products being imported to
and sold in the Philippines in accordance with the provisions of R.A. No. 7843 and
its implementing rules and requirements." The CA emphasized that it was inclined
to believe that there was no meeting of the minds of the parties when the petitioner
inserted the phrase "based on the findings of the BIS" in the revised compromise
agreement; hence, there could not have been perjury when the private respondent
executed the Affidavit of Merit and the Urgent Motion to Set Aside and/or Vacate
Judgment. The CA also agreed with the findings of the Secretary of Justice that
the insertion of the condition in the compromise agreement that the parties would
be bound by the BIS findings and recommendation gave the private respondent
reason to believe that he was deceived by the petitioner into signing the
Agreement; as such, the private respondent’s allegation in his Affidavit of Merit,
that he was induced to signing the Compromise Agreement through fraud and
deceit, was not altogether false. Consequently, the CA ruled, the private
respondent did not make any willful and deliberate assertion of a falsehood.20 The
appellate court conformed to the disquisitions of the Secretary of Justice in the
assailed resolution and concluded that the private respondent did not, in the
Affidavit of Merit, make a willful and deliberate assertion of a falsehood.21
Aggrieved, the petitioner filed a petition for review on certiorari with this Court
against private respondent Von Sprengeisen and the Secretary of Justice, insisting
that the CA committed grave abuse of discretion amounting to excess or lack of
jurisdiction in dismissing the petition and affirming the assailed resolution.
The petitioner maintains that, during the preliminary investigation, he adduced
substantial evidence to prove probable cause for perjury against the private
respondent. He maintains that probable cause does not mean actual and positive
causes; nor does it import absolute certainty. It is merely based on opinion and
reasonable belief. It is enough that it is believed that the act or omission
complained of constitutes the offense charged. He avers that, contrary to the claim
of the private respondent in his Affidavit of Merit, the meeting between him and
Jesus Borgonio, on the one hand, and the private respondent and HTC Sales
Manager Dennis Gonzales, on the other, was arranged by the latter and not by
him. As gleaned from the draft and final copies of the compromise agreement, the
parties made express reference to the prima facie  findings of the BIS that the
actual export price of HTC was below the fair market value. By agreeing that such
findings of the BIS be included in the Compromise Agreement, the said private
respondent impliedly agreed to such findings as basis of the price for which HTC
would sell the German-made magnesite-based refractory bricks in the Philippines.
The petitioner avers that the fact that the amount of DM 1,050 per metric ton was
not specifically mentioned in the compromise agreement was of no importance,
considering the parties’ acceptance of such findings is based on R.A. No. 7843. He
points out that the private respondent could not have failed to notice the difference
between the first draft and the final copy of the agreement before signing it
because, as alleged by Lino Gutierrez in his reply affidavit, it took the private
respondent twenty minutes or so after receiving the agreement to review the final
draft before signing it. Moreover, the Urgent Motion to Set Aside and/or Vacate
Judgment signed by the private respondent was filed more than 15 months from
the execution of the compromise agreement and after four months from the Tariff
Commission’s approval thereof.
The petitioner argues that it is incredible that during the interregnum of 19 months,
the private respondent failed to discover the revisions/insertions in the final draft of
the compromise agreement. Considering the premises, the petitioner submits, the
private respondent’s filing of the Urgent Motion for and in behalf of HTC was
merely an afterthought, to enable the latter to escape compliance with the terms
and conditions of the Agreement.
The petitioner further insists that the insertion of the contested phrase in the final
draft of the compromise agreement was necessary although it may not be in the
best interest of HTC. He posits that the falsehoods made by the private respondent
in his Urgent Motion and Affidavit of Merit were material to the proceedings in the
Anti-Dumping Office of the Tariff Commission because these were used to set
aside the compromise agreement executed by the parties.
In his Comment on the petition, the private respondent avers that the issues raised
by the petitioner are factual, hence, improper in a petition for
review on certiorari under Rule 45 of the Rules of Court. The determination of the
existence of a probable cause is primarily an administrative sanction of the
Secretary of Justice. He insists that the findings of the Justice Secretary should be
accorded great respect, especially since the same were upheld by the CA. He
asserts that the petitioner failed to establish in the CA and in this Court that the
Justice Secretary committed a grave abuse of discretion amounting to excess or
lack of jurisdiction in her resolution.
The petition has no merit.
The pivotal issue in this case is factual – whether or not, based on the records,
there was probable cause for the private respondent’s indictment for perjury.
Rule 45 of the Rules of Court provides that only questions of fact may be raised in
a petition for review on certiorari. Findings of facts of a quasi-judicial agency, as
affirmed by the CA, are generally conclusive on the Court, unless cogent facts and
circumstances of such a nature warranting the modification or reversal of the
assailed decision were ignored, misunderstood or misinterpreted. Thus, the Court
may delve into and resolve factual issues in exceptional cases. The petitioner has
failed to establish that any such circumstance is present in the case at bar.22
The Court finds that the public respondent did not commit any grave abuse of
discretion amounting to excess or lack of jurisdiction in issuing the assailed
resolution, and that the CA did not commit any reversible error in its assailed
decision and resolution. If at all the public respondent erred in issuing the assailed
resolution, such is merely an error in the exercise of jurisdiction, reversible by a
petition for review under Rule 43 of the Rules of Court especially so where, as in
this case, the issues before the CA were factual and not legal. The absence or
existence of probable cause in a given case involves a calibration and a
reexamination of the evidence adduced by the parties before the Office of the City
Prosecutor of Manila and the probative weight thereof. The CA thus ruled correctly
when it dismissed the petition before it.
Probable cause, for purposes of filing a criminal information, has been defined as
such facts as are sufficient to engender a well-founded belief that a crime has
been committed and that the private respondent is probably guilty thereof. It is
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. 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."23
The determination of its existence lies within the discretion of the prosecuting
officers after conducting a preliminary investigation upon complaint of an offended
party.24 The Resolution of the Secretary of Justice declaring the absence or
existence of a probable cause affirmed by the CA is accorded high respect.
However, such finding may be nullified where grave abuse of discretion amounting
to excess or lack of jurisdiction is established.25
Perjury is defined and penalized in Article 183 of the Revised Penal Code, thus:
Art. 183. False testimony in other cases and perjury in solemn affirmation. The
penalty of arresto mayor in its maximum period to prision correccional in its
minimum period shall be imposed upon any person who, knowingly making
untruthful statements and not being included in the provisions of the next
preceding articles, shall testify under oath or make an affidavit upon any material
matter before a competent person authorized to administer an oath in cases in
which the law so requires.
Any person who, in case of a solemn affirmation made in lieu of an oath, shall
commit any of the falsehoods mentioned in this and the three preceding articles of
this section shall suffer the respective penalties provided therein.
Perjury is an obstruction of justice; its perpetration may affect the earnest concerns
of the parties before a tribunal. The felony is consummated when the false
statement is made.26
The seminal modern treatment of the history of perjury concludes that one
consideration of policy overshadows all others – the measures taken against the
offense must not be so severe as to discourage aggrieved parties from lodging
complaints or testifying.27 As quoted by Dean Wigmore, a leading 19th Century
Commentator, noted that English law, "throws every fence round a person accused
of perjury, for the obligation of protecting witnesses from oppression or annoyance,
by charges, or threats of charges, of having made false testimony is far paramount
to that of giving even perjury its deserts."28
Perjury is the willful and corrupt assertion of a falsehood under oath or affirmation
administered by authority of law on a material matter.29 The elements of the felony
are:
(a) That the accused made a statement under oath or executed an affidavit upon a
material matter.
(b) That the statement or affidavit was made before a competent officer, authorized
to receive and administer oath.
(c) That in that statement or affidavit, the accused made a willful and deliberate
assertion of a falsehood.
(d) That the sworn statement or affidavit containing the falsity is required by law or
made for a legal purpose.30
A mere assertion of a false objective fact, a falsehood, is not enough. The
assertion must be deliberate and willful.31 Perjury being a felony by dolo, there
must be malice on the part of the accused.32 Willfully means intentionally; with evil
intent and legal malice, with the consciousness that the alleged perjurious
statement is false with the intent that it should be received as a statement of what
was true in fact. It is equivalent to "knowingly." "Deliberately" implies meditated as
distinguished from inadvertent acts.33 It must appear that the accused knows his
statement to be false or as consciously ignorant of its truth.34
Perjury cannot be willful where the oath is according to belief or conviction as to its
truth. A false statement of a belief is not perjury. Bona fide belief in the truth of a
statement is an adequate defense.35 A false statement which is obviously the result
of an honest mistake is not perjury.
There are two essential elements of proof for perjury: (1) the statement made by
the defendants must be proven false; and (2) it must be proven that the defendant
did not believe those statements to be true.36
Knowledge by the accused of the falsity of his statement is an internal act. It may
be proved by his admissions or by circumstantial evidence. The state of mind of
the accused may be determined by the things he says and does, from proof of a
motive to lie and of the objective falsity itself, and from other facts tending to show
that the accused really knew the things he claimed not to know.37
A conviction for perjury cannot be sustained merely upon the contradictory sworn
statements of the accused. The prosecution must prove which of the two
statements is false and must show the statement to be false by other evidence
than the contradicting statement.38 The rationale of this principle is thus:
… Proof that accused has given contradictory testimony under oath at a different
time will not be sufficient to establish the falsity of testimony charged as perjury, for
this would leave simply one oath of the defendant as against another, and it would
not appear that the testimony charged was false rather than the testimony
contradictory thereof. The two statements will simply neutralize each other; there
must be some corroboration of the contradictory testimony. Such corroboration,
however, may be furnished by evidence aliunde tending to show perjury
independently of the declarations of testimony of the accused.39
The term "material matter" is the main fact subject of the inquiry, or any
circumstance which tends to prove that fact, or any fact or circumstance which
tends to corroborate or strengthen the testimony related to the subject of the
inquiry, or which legitimately affects the credence of any witness who testified. In
this case, a matter is material if it has a material effect or tendency to influence the
Commission in resolving the motion of HTC one way or the other. The effects of
the statement are weighed in terms of potentiality rather than probability.40 The
prosecution need not prove that the false testimony actually influenced the
Commission.41
The private respondent did err when he declared, in the motion of the HTC and his
affidavit, that it was the petitioner who invited him to a
conference. The truth of the matter is that it was Gonzales who did so.
Nonetheless, the issue of who called for a conference is of de minimis importance
because, after all, the parties agreed to meet after having been prodded by the
Chairman of the Commission to settle the case instead of going through the
tribulations and expenses of a protracted litigation. No adverse inference (related
to the merits of their respective contention in this case) can be ascribed as to
whoever called the conference. After all, parties are even urged to settle cases
amicably.
Besides, as correctly declared by the Second Assistant City Prosecutor in her
resolution:
The allegation that it was complainant who invited respondent to the meeting may
not be a deliberate lie. Respondent may not have known who arranged the
meeting, but as he was able to talk to complainant, he presumed that it was
complainant who extended the invitation. Moreover, the identity of the one who
initiated the meeting is not material considering that there was a meeting of the
minds of the Parties.42
The Court also agrees with the contention of the private respondent that the copy
of the first agreement transmitted to him was a fax copy of the draft, and that,
contrary to the allegations of the private respondent, such agreement was
prepared by Borgonia and not by the petitioner. As gleaned from page two of the
agreement, the particulars of the residence certificates of the petitioner and the
private respondent were not typewritten, hence, cannot as yet be notarized. As
claimed by the private respondent, a copy was transmitted to him for his personal
review, and if he found it to be in order, the petitioner and Borgonia would prepare
and sign the agreement and give it back to him for review and signature, with the
particulars of his community tax certificate indicated in the final copy.
Undeniably, the identity of the person who prepared or caused to prepare the
compromise agreement subsequently signed by the petitioner and the private
respondent was of prime importance because only such person should be charged
for perjury. The private respondent erroneously stated in his Affidavit of Merit and
Urgent Motion that it was the petitioner who prepared the agreement that was
signed by the parties. It turned out that it was Borgonia who prepared the first and
the second copies. However, the private respondent cannot be held liable for
perjury since it was Borgonia who prepared the agreement and not the petitioner.
The Court agrees with the following contention of the private respondent in his
counter-affidavit:
4.6 While complainant claims that it was not he but Mr. Borgonia who made the
insertions, there is no doubt that, indeed, the insertions were made into the
document. Since complainant is the signatory to the Compromise Agreement, it is
but natural for one to presume that he had made the insertions. At the same time, I
can not be expected to know that it was Mr. Borgonia, as claimed by complainant,
who made such insertions.43
Indeed, Borgonia was merely the Manager of the Management Information Group
of RCP, whereas the petitioner was no less than its Senior Vice President and
Assistant General Manager, Borgonia’s superior. Unless and until approved by the
petitioner, any agreement prepared by Borgonia was merely a piece of paper,
barren of any legal effect. In this case, the compromise agreement prepared by
Borgonia had the petitioner’s
imprimatur. Borgonia was merely a witness to the agreement. For all legal intents
and purposes, the petitioner had the compromise agreement prepared under his
supervision and control. It cannot thus be concluded that the private respondent
made a deliberate falsehood when he alleged that the agreement was prepared by
the petitioner.
The Court is not persuaded by the petitioner’s claim that, during the conference, he
and the private respondent agreed that, based on the BIS report, the normal value
of the imported refractory bricks per metric ton was DM 1,200, and that such report
would be used as basis for the revision of the price policy and structure of HTC.
It bears stressing that, during the conference, the petitioner and the private
respondent had agreed on three aspects of the case: (1) based on the prima
facie findings of the BIS, the normal value of the goods per meter ton was DM
1,200 and that the actual export price of HTC was below the fair market value; (2)
to terminate the case, HTC will have to adjust and revise its price policy and
structure for imported refractory bricks to conform to R.A. No. 7843 and rules and
regulations implementing the law; and (3) if HTC fails or refuses to comply with its
undertaking, RCP will be entitled to a writ of execution without need of demand.
However, the petitioner and the private respondent could not have agreed on such
base price; the petitioner insisted on the amount recommended by the BIS (DM
1,200) while the private respondent insisted on DM 950. There was an impasse.
By way of a compromise, the parties agreed to do away with the BIS
recommended base
value and agreed for HTC to base the normal value of the importation per metric
ton under R.A. No. 7843 and the rules issued implementing the law. This is
gleaned from the affidavit of Borgonia:
13. During the meeting, Mr. von Sprengeisen suggested that the value of DM
1,050/ton be applied as the price at which Hamburg Trading would sell German-
made magnesite-based refractory bricks in the Philippines. Mr. Villanueva did not
agree to the suggested value, as we considered it low. In the end, both parties
decided to base the determination of the price on the provisions of Republic Act
No. 7843 and its implementing rules and regulations. …44
Borgonia prepared the first compromise agreement and incorporated therein the
agreement of the petitioner and the private respondent arrived at during the
conference, thus:
1. For the purpose of buying peace and by way of concession in order to end
litigation, the SECOND PARTY undertakes and commits to reform its pricing policy
and structure with respect to refractory products being imported interest sold in the
Philippines in accordance with the provisions of Republic Act 7843 and its
implementing rules and regulations.45
If, as claimed by the petitioner in his Affidavit-Complaint, he and the private
respondent had agreed that HTC will use as basis for its price policy and structural
revision, the BIS report, for sure, Borgonia would have incorporated the said
agreement in the first compromise agreement. He did not, and Borgonia has not
offered any explanation for such failure. The petitioner signed the draft of the
agreement without any plaint or revision. It was only in the second compromise
agreement that was later signed by the petitioner and the private respondent that
Borgonia incorporated the phrase
"based on the findings of the BIS." Borgonia and the petitioner made the insertion
on their own, without the a priori consent of the private respondent.
The Court is not convinced by the petitioner’s contention (and that of Borgonia in
his Affidavit) that the petitioner and the private respondent had agreed to leave the
final determination of the base value or price of importation per metric ton to a third
party (BIS). The private respondent could not have agreed to the use of the BIS
report because, as mentioned, he had strenuously objected to its use as basis for
the revision of its price policy and structure. For HTC to admit that the BIS finding
of DM 1,200 per metric ton was the normal value of the refractory bricks from
Germany for the purpose of resolving the anti-dumping case is one thing; but for
HTC to agree to be bound by the BIS recommendation for the purpose of revising
its price policy and structure is completely a different matter.
With the petitioner and the private respondent’s admission of the prima
facie findings of the BIS, the Commission can prepare its recommendation to the
Special Committee on the protest of the RCP to the HTC importation subject of the
case. Thereafter:
D. The Special Committee shall, within fifteen (15) days after receipt of the report
of the Commission, decide whether the article in question is being imported in
violation of this section and shall give due notice of such decision. In case the
decision of dumping is in the affirmative, the special committee shall direct the
Commissioner of Customs to cause the dumping duty, to be levied, collected and
paid, as prescribed in this section, in addition to any other duties, taxes and
charges imposed by law on such article, and on the articles of the same specific
kind or class subsequently imported under similar circumstances coming from the
specific country.
In the event that the Special Committee fails to decide within the period prescribed
herein, the recommendation of the Commission shall be deemed approved and
shall be final and executory.46
On the matter of the revision or adjustment of the price policy and structure of
HTC, the parties had agreed to accomplish the same in due time. It goes without
saying that the RCP retained the right to object to or protest to the price policy and
structure revision of HTC.
The agreement of the petitioner and the private respondent not to be bound by the
base value in the BIS report for the revision of its price policy and structure is not
unexpected because: (1) the findings of the BIS are only prima facie, meaning to
say, not conclusive, and HTC was accorded a chance to base its price policy and
structure on evidence and informations other than those contained in the BIS
report; (2) the normal value of the imported refractory bricks may fluctuate from
time to time, hence, the need for any importer to revise its price policy and
structure from time to time; and (3) the base value to be used by HTC in revising
its price policy would be scrutinized and resolved initially by the Commission, by
the Special Committee and by the Court of Tax Appeals on appeal.
The process agreed upon by the petitioner and the private respondent was not
only practical and fair, but in accord with law as well.
In fine, the private respondent did not commit any falsehood in the Urgent Motion
and his Affidavit of Merit when he declared that he and the
petitioner put behind them the BIS report, and agreed to use R.A. No. 7843 and
the rules and regulations implementing the same to determine the base price for
the revision of the price policy and structure of HTC.
Admittedly, the respondent did not object to the offending phrase before and after
signing the agreement and for a considerable stretch period until HTC filed its
motion. However, we do not agree with the contention of the petitioner that such
failure of the respondent to object to the offending phrase for such period of time
amounted to an admission that, indeed, the private respondent was aware of the
offending phrase in the Agreement, and to his agreement thereto; and estopped
the private respondent from alleging that he was deceived by the petitioner into
signing the Compromise Agreement. In his appeal to the DOJ, the private
respondent declared that:
3.9 True, respondent-appellant may have been remiss and lacking in circumspect
in failing to review the hard copy Compromise Agreement and notice the insertion.
Being in the trading business, respondent-appellant personally handles hundreds
of documents daily and is on the telephone for most of the day communicating with
suppliers and customers. And he had no reason to believe that either complainant-
appellee or Mr. Borgonia would make such an insertion, especially after the hearing on the Compromise Agreement; and showing that the private
respondent-appellant had accepted the fax Compromise Agreement wording and respondent did not object thereto.
conveyed such acceptance to complainant-appellee’s office. Respondent-appellant
also had to reason to even think that such a surreptitious insertion would be made; IN LIGHT OF ALL THE FOREGOING, the petition is DENIED for lack of merit.
after all, he had a very warm and friendly meeting with complainant-appellee and The assailed Decision of the Court of Appeals in CA-G.R. SP No. 76999
Mr. Borgonia and came out of it with a feeling that he could trust complainant- is AFFIRMED. Costs against the petitioner.
appellee (p. 4, Annex "C").
SO ORDERED.
3.10 Hence, when respondent-appellant alleges that he was induced to sign the
hard copy Compromise Agreement through fraud and deceit, respondent-appellant
honestly believes that he was misled into signing it. He was misled by the fact that
he had been sent the fax Compromise Agreement by complainant-appellee, that
he had conveyed its acceptability to complainant-appellee and now requested for
the hard copy for execution, that he had been led to trust that the findings and
recommendation of the BIS were being put behind them and that complainant-
appellee had agreed to such a compromise. The transmittal of the hard copy
Compromise Agreement, without any notice or mention by complainant-appellee or
complainant-appellee’s office that it contained
insertions or wording different from the fax Compromise Agreement, and on
respondent-appellant’s understanding that the wording of the hard copy
Compromise Agreement would be exactly the same as the fax Compromise
Agreement, constitutes the fraud or deceit allegedly by respondent-appellant.47

In his rejoinder-affidavit, the private respondent explained that:

2. Again, contrary to the allegations in the Reply-Affidavits, I was unable to review

the Compromise Agreement delivered by Mr. Gutierrez on 22 April 1997 as I was
busy with numerous calls and business at the time it was delivered. Also, I had
been led to believe in our meetings with Mr. Villanueva and Mr. Borgonia that I
could trust them. So, after having seen the fax Compromise Agreement and being
amenable to it, I trusted that they would send a genuine hard copy. As it turned
out, I was mistaken.48

Moreover, even before filing the Urgent Motion and signing the Affidavit of Merit,
the private respondent tried for several times to contact the petitioner, but the latter
failed to return his calls. This reinforced the suspicion of the private respondent
that the insertion of the offending phrase was not, after all, inadvertent but
deliberate, calculated to deceive him to the prejudice of HTC. The private G.R. No. 139984. March 31, 2005
respondent may be blamed for putting too much trust and confidence on the
petitioner, but he certainly cannot be indicted for perjury for lack of probable cause. LEOPOLDO OANI, Petitioners,
vs.
The petitioner failed to append to his petition records of the Commission that the PEOPLE OF THE PHILIPPINES, Respondents.
private respondent appeared for HTC, on May 9, 1997, before the Commission for
DECISION
CALLEJO, SR., J.: inspections of other business establishments in connection with the said
purchases.
During the school year 1988-1989, the Panabo High School in Panabo, Davao del
Norte, headed by its Principal, Leopoldo Oani, implemented the free secondary The team discovered that on June 23, 1989, Oani had approved a Requisition and
school program of the government. During the period of November 1, 1988 to Issue Voucher5 for the acquisition of 15 units of fire extinguishers for the use of the
December 31, 1989, the high school received the amount of ₱648,532.00 from the high school as mandated by Presidential Decree No. 1185, also known as the Fire
Department of Education, Culture and Sports (DECS) for Maintenance and Other Code of the Philippines. The supplies are described in the voucher as follows:
Operating Expenses (MOOE).1 Of the said amount, ₱551,439.13 was earmarked
for the purchase of various supplies, materials and equipment.2 Quantity Unit Article
15 Units 10 lbs. capacity powerline
On March 1, 1990, the DECS Secretary received a letter3 from the Parents fire extinquisher ABC Tri-
Teachers Association of the Panabo High School regarding the investigation of Class dry chemical
Principal Oani and Bonifacio Roa, the Resident Auditor regarding, among other
things, the alleged overpricing of 12 fire extinguishers for ₱15,000.00 each. The general purpose – BRAND
Regional Office of the COA then issued Assignment Order No. 90-137 dated NEW -
March 2, 1990 to a team of auditors, composed of Jaime P. Naranjo, as Chairman,
    In compliance with PD
and Bienvenido Presilda and Carmencita Enriquez, as members. The team had
1185 known as Fire Code
the following tasks:
of the Philippines.
To determine whether the MOOE Funds of the Panabo High School, particularly
for supplies, materials and equipment were utilized and/or expended in The amount of ₱55,000.00 was certified as available for the purpose. Instead of
accordance with existing laws, rules and regulations. conducting a public bidding, Oani decided to purchase the fire extinguishers from
the Powerline Manufacturing Industry (Powerline, for brevity) for ₱54,747.00.
Powerline was owned by Francisco Cunanan and had its business address at Km.
Specific Objectives: 5, Carnation St., Buhangin, Davao City. The enterprise was authorized by the
Department of Trade and Industry to manufacture and refill stored pressure type
1. To be able to identify losses of funds resulting from fraudulent transactions. (Light Pink only) mono-ammonium phosphate for ABC fires.6

2. To be able to determine the following: On June 27, 1989, Oani approved Purchase Order No. 27 for nine units of fire
extinguishers and requested Powerline to deliver the supplies. Upon delivery
a) Existence of fraud. thereof, Oani approved a disbursement voucher8 in favor of the supplier for the
amount of ₱54,747.00. The supplier acknowledged receipt of the said amount
b) Extent of fraud committed. through check.9.

c) Method or means by which fraud was committed. The members of the Audit Team that conducted a re-canvass for fire extinguishers
of the same brand and features as those supplied by Cunanan discovered that
each unit could be purchased for only ₱2,970.00, inclusive of 10% allowance. The
d) Persons liable.4
purchase of the nine units of fire extinguishers was, thus, overpriced by
₱23,040.00.10
The team gathered information based on interviews of the persons involved,
including Oani and Roa, and other school personnel. They also secured
Oani had also approved a Requisition and Issue Voucher for a set of Stereo
documents from government agencies and private entities to verify the purchase
Amplifier and components described therein, thus:
and delivery of fire extinguishers, as well as office and school supplies to the high
school which were charged against the MOOE. They, likewise, conducted ocular
Quantity Article
1 set Stereo Amplifier – In a separate transaction, Oani again approved the purchase of office supplies
chargeable against the MOOE. The contract was awarded to the Red Lion
Consisting of the [ff]: Marketing for ₱111,912.35. The supplies were delivered by Red Lion Marketing to
  1 unit Sound Research SR 100A the high school per Sales Invoice Nos. 486, 487, 488 and 489 on March 10, 1989.
200 Watts Oani approved Disbursement Voucher No. 101-8903-01718 in favor of Red Lion
Marketing for the said amount. Payment for the merchandise was, likewise,
received by the supplier.
1 unit Sound Research 6 Mic.
Mixer
The Auditing Team conducted a review of the prices of the stereo set and school
and office supplies, and discovered that they could be purchased for only
1 set 12" 3-Way Speaker ₱144,621.51 instead of the ₱227,857.45 paid by the school. The Auditing Team
System recommended the filing of administrative and criminal complaints for violations of
Rep. Act No. 3019 against Oani and Roa.
1 unit Radio Cassette – Portable
On March 30, 1993, Informations were filed against Oani and Roa in the
1 unit Phono – Magnetic Sandiganbayan for violation of Section 3(e) of Rep. Act No. 3019. The accusatory
portion of the Information docketed as Criminal Case No. 18885 reads:
2 units Microphone &
Microphone Stand w/ Holder That on or about the month of December 1989, and sometime prior or subsequent
3 pieces Electrical Bell 8-10 inches thereto, in the Municipality of Panabo, Province of Davao del Norte, Philippines,
diameter11 and within the jurisdiction of this Honorable Court, the above-named accused, both
public officers, LEOPOLDO OANI being then the Secondary School Principal and
Separate invitations to bid were sent to ASM Enterprise, Edwin Marketing and RS BONIFACIO ROA being then the Resident Auditor, both of the Panabo High
Marketing,12 which submitted their bids to the Awards Committee composed of School, Davao del Norte, while in the performance of their official functions,
Oani, as Chairman, and Domingo Pintongan, Mercita Jayoma and Roa as committing the offense in relation to their office and conspiring and confederating
members. The contract was awarded to ASM Marketing.13 with each other, did then and there willfully, unlawfully, criminally and with evident
bad faith cause undue injury to the Government in the following manner: in the
purchase of nine (9) fire extinguishers for the Panabo High School, accused
On December 28, 1989, Oani approved a Purchase Order14 for a complete set of
deliberately disregarded the requirements on public bidding by allowing the forms
amplifiers for the price of ₱35,650.00 and requested the ASM Marketing to deliver
such as Request for Quotations and Canvass to be accomplished by the winning
the merchandise. As per Oani’s request, Arlene Lomugdang, the accounting clerk
bidder notwithstanding the fact that no canvass was made at all, as [a] result of
of the school, issued a Certification that the amount of ₱35,650.00 was available
which the nine (9) fire extinguishers were purchased from Powerline Company at
for the said expense.15
the total price of ₱54,747.00, although the real amount of such fire extinguishers
and which was supposed to have been paid was only ₱2,560.00 per unit or
Check No. 095751 was drawn against the MOOE for ₱35,650.00 in payment of the ₱23,040.00 in all, thereby causing undue injury to the government in the amount of
said supplies and was remitted to the ASM Marketing, after the disbursement THIRTY-ONE THOUSAND SEVEN HUNDRED PESOS (₱31,700.00), Philippine
voucher16 for the said amount was approved by Oani. Currency.

Canvass forms were distributed to business enterprises, including Red Lion CONTRARY TO LAW.19
Marketing for the purchase of office supplies. The contract was awarded to Red
Lion Marketing for the price of ₱61,912.35. The office supplies were delivered to
The other Information, docketed as Criminal Case No. 18886, reads:
the school, after which Oani approved the disbursement voucher for the said
amount which was drawn against the MOOE.17 The supplier thereafter received
payment thereon. That on or about the month of December 1989, in the Municipality of Panabo,
Province of Davao del Norte, Philippines, and within the jurisdiction of this
Honorable Court, the above-named accused, both public officers, LEOPOLDO
OANI being then the Secondary School Principal and BONIFACIO ROA being then
the Resident Auditor, both of Panabo High School, Davao del Norte, while in the
performance of their official functions, committing the offense in relation to their
office, and conspiring and confederating with one another, did then and there
willfully, unlawfully, criminally and through evident bad faith cause undue injury to
the Government in the following manner: in the purchase of sound equipment,
supplies and materials for the Panabo High School, accused deliberately
disregarded the requirements on public bidding by allowing the forms such as
Request for Quotations and Canvass to be accomplished by the winning bidders
themselves notwithstanding the fact that no canvass was made at all, as a result of
which the sound equipment, office forms and office supplies were purchased from
ASM Marketing and Red Lion Marketing for a total price of ₱227,857.45, although
the real amount supposed to have been paid was only ₱144,621.51, thus, causing
undue injury to the Government in the amount of EIGHTY-THREE THOUSAND
TWO HUNDRED THIRTY-FIVE & 94/100 pesos (₱83,235.94), Philippine
Currency.
CONTRARY TO LAW.20
Oani admitted that no public bidding was conducted prior to the purchase and
delivery of the fire extinguishers, but averred that he was authorized to purchase
the same by negotiation because Francisco R. Cunanan, the proprietor of
Powerline, submitted a Certification dated "January 1988" pursuant to COA
Circular No. 91-368 and Article 7, Section 442 of the Government Auditing Rules
and Regulations (GARR), stating that the company is the only authorized and duly-
licensed manufacturer and exclusive distributor of Powerline fire extinguishers
brand, and that no other dealer, sub-dealer or distributor was appointed or
authorized to sell his major line products.21 Oani averred that a canvass of prices
was done for the purchase of the office and school supplies, and that the Bidding
Committee awarded the contract to ASM Marketing based on the abstract of bids
placed by the suppliers at the scheduled bidding. He then approved the purchase
orders for the supplies to ASM Marketing which delivered the equipment. The
same procedure was followed for the purchase of the office supplies. He asserted
that the law and the COA procedures were followed in the bidding process and the
purchase of school and office supplies.
Oani further averred that the trial court erred in relying solely on the Audit Report of
the auditing team. He asserted that it was not his duty to check whether those
participating in the bidding were bona fide dealers. As long as such bidder could
purchase the supplies and materials indicated in the bidding request and the price
is reasonable, there was sufficient basis to award the contracts. He admitted the
possibility that he had made a wrong assessment of the bidding and canvass, but
claimed that he acted in good faith.
After trial, the Sandiganbayan promulgated a decision acquitting Roa, but
convicting Oani of the crimes charged. The fallo of the decision reads:
WHEREFORE, judgment is hereby rendered CONVICTING accused LEOPOLDO
E. OANI of the crime[s] charged in both Criminal Cases Nos. 18885 and 18886, his
guilt having been proven beyond reasonable doubt. Accordingly, in Criminal Case
No. 18885, Leopoldo E. Oani is hereby sentenced to suffer an indeterminate
penalty of SIX (6) YEARS and ONE (1) MONTH as minimum, to EIGHT (8)
YEARS as maximum, and to suffer perpetual disqualification from public office. He
is ordered to restitute to the treasurer of the Panabo National High School the
amount of TWENTY-THREE THOUSAND FORTY PESOS (₱23,040.00).
In Criminal Case No. 18886, Leopoldo E. Oani is hereby sentenced to suffer an
indeterminate penalty of SIX (6) YEARS and ONE (1) MONTH, as minimum, to
EIGHT (8) YEARS, as maximum, and to suffer perpetual disqualification from
public office. Also, he is hereby ordered to restitute the amount of SEVENTY-
THREE THOUSAND EIGHT HUNDRED SEVENTY-EIGHT PESOS AND
SEVENTY-NINE CENTAVOS (₱73,878.79) to the treasurer of the Panabo
National High School.
The actual period of accused LEOPOLDO E. OANI’s preventive imprisonment, if
any, shall be credited to the service of his sentence.
As to accused BONIFACIO ROA y GALINDO, he is hereby ACQUITTED of the
crime charged in both Criminal Cases No. 18885 and 18886.
Accordingly, the cash bond of the said BONIFACIO ROA posted in both cases in
the amount of FIFTEEN THOUSAND PESOS (₱15,000.00) each, as evidenced by
O.R. No. 2968083 and O.R. No. 2968084, is hereby ordered CANCELLED.
Considering that the facts from which civil liability against the said Bonifacio Roa
might arise did not exist, no civil liability is imposed against him.
The Honorable Commissioner, CID, is hereby ordered to CANCEL the name of
BONIFACIO ROA y GALINDO from his Commission‘s Hold Departure List, if any.
With costs against accused LEOPOLDO E. OANI.22
Oani, now the petitioner, filed the instant petition for review on certiorari with this
Court and raised therein the following sole issue:
WHETHER OR NOT THE GUILT OF THE PETITIONER WAS PROVEN BEYOND
REASONABLE DOUBT TO CONVICT HIM OF VIOLATION OF SEC. 3(e) OF RA
3019, AS AMENDED.23
We note that the issues raised by the petitioner are factual. Under Rule 45 of the
Rules of Court, only questions of law may be raised that in a petition for review on
certiorari. The Court is not a trier of facts; hence, it is not its duty to re-examine and
reevaluate the evidence of the parties. Moreover, the findings of facts of the CA or
the Sandiganbayan are, as a general rule, conclusive on the Court. And while the
Court may entertain and resolve factual issues in exceptional circumstances,24 the
petitioner in this case was unable to establish any such exceptional circumstance.
Indeed, the Court assiduously reviewed the records and found no justification for
the modification, much less the reversal of the decision of the trial court.
The petitioner avers that the trial court erred in finding him guilty of violating
Section 3(e) of Rep. Act No. 3019 for the purchase of the fire extinguishers without
any public bidding. He maintains that since Powerline was the exclusive
manufacturer of the fire extinguishers and had not designated any dealer or
subdealer of its products as evidenced by the Certification of Cunanan,25 he was
justified in dispensing with a public bidding and to purchase the fire extinguishers
on a negotiated basis with Powerline.
The petitioner is wrong.
COA Circular No. 78-84 dated August 1, 1978, provides that negotiated contracts
may be entered into where any of the following conditions exist:
1. Whenever the supplies are urgently needed to meet an emergency which may
involve the loss of, or danger to life and/or property;
2. Whenever the supplies to be used in connection with a project or activity which
cannot be delayed without causing detriment to the public service;
3. Whenever the materials are sold by an exclusive distributor or manufacturer
who does not have subdealers selling at lower prices and for which no suitable
substitute can be obtained elsewhere at more advantageous terms to the
government;
4. Whenever the supplies under procurement have been unsuccessfully placed on
bid for at least two consecutive times, either due to lack of bidders or the offers
received in each instance equipment, the purchase of nine (9) units fire
extinguishers were exhorbitant or non-confirming to specifications;
5. In cases where it is apparent that the requisition of the needed supplies through
negotiated purchase is most advantageous to the government as determined by
the head of agency;
6. Whenever the purchase is made from an agency of the government;
7. Whenever the purchase is made from a foreign government.26
None of the foregoing conditions existed when the petitioner purchased the fire
extinguishers on a negotiated basis from Powerline.
The petitioner did not require Cunanan to submit any certification from the
Department of Trade and Industry that he was the exclusive distributor or
manufacturer of fire extinguishers. Neither did he require Cunanan to certify or
execute an affidavit that no subdealer had been designated to sell the said product
at a lower price. The petitioner failed to ascertain whether a suitable substitute
could be obtained elsewhere, under terms more advantageous to the government.
It turned out that as declared by the trial court, another business enterprise,
Systems Products Industries, was selling the same brand and specifications at
only ₱2,900.00 per unit.
Finally, accused Oani failed to present proof that "no suitable substitute can be
obtained elsewhere at more advantageous terms to the government," as thus,
required by COA Circular 78-84, series of 1978.
Indeed, as it turned out, not only was there another manufacturer and refiller of
similar type of fire extinguisher and dry chemical used in it in Davao City, but more
importantly, Systems Products Industries, which was registered and accredited
with the DTI, as evidenced by the said certification of Syvelyn J. Tan, Regional
Director, Region XI, DTI, was selling identical items at ₱2,700.00 each, as shown
by the re-canvass form dated March 13, 1990. Crediting to this the 10% allowance
authorized under COA Circular No. 85-55, the total per unit cost is ₱2,970.00.
Subtracting this figure from the unit cost stated in the Disbursement voucher,
which is ₱5,530.00, we get a difference of ₱2,560.00, which could have been
saved had accused Oani conducted bidding or canvass, and purchased the nine
(9) units of fire extinguishers from Systems Products Industries. Consequently, in
failing to observe the requirements in government purchase, or at least, the
diligence which a similarly situated reasonable person would have taken, accused
Oani caused the Panabo High School and the government to suffer a total amount
of ₱23,040.00, in Criminal Case No. 18885.27
To extricate himself from administrative and criminal liabilities for his acts and
omissions, the petitioner adduced in evidence a Certification purportedly dated
"January 1988," that Cunanan was the sole manufacturer/dealer of the fire
extinguishers and had not designated a sub-dealer of his products. However, as
declared by the trial court, this certification, which the petitioner adduced in
evidence, exposed his travesty of foisting a falsified document as evidence, a
felony under the last paragraph of Article 172 of the Revised Penal Code.28 The
Certification reads:
January 1988
CERTIFICATION
As Licensed Manufacturer and Exclusive Distributor
TO WHOM IT MAY CONCERN:
THIS IS TO CERTIFY that I, MR. FRANCISCO R. CUNANAN, of legal age,
Filipino, Proprietor of Powerline Manufacturing Industry, with business address
located at Km. 5, Carnation St., Buhangin, Davao City, is a duly-licensed
Manufacturer and Exclusive Distributor of POWERLINE Fire Extinguishers, do
hereby certify and attest:
1. THAT, I am the owner and chairman of Powerline Manufacturing Industry
engaged in manufacturing POWERLINE brand fire extinguishers.
2. THAT, I have not appointed or authorized any dealer, subdealer and distributor
to promote and sell our major line product, the POWERLINE fire extinguishers in
Mindanao Area or any parts/ area in the Philippines.
3. THAT, I have in my possession all legal documents proving (sic) my Company is
the only authorized and duly-licensed manufacturer and exclusive distributor of
POWERLINE fire extinguishers brand.
4. THAT, I am executing this certification in (sic) pursuant to Article 7, Section 442
of the Government Auditing Rules & Regulations (GAAM Volume I) under COA
Circular No. 91-368 governing the procurement from Duly-licensed Manufacturers
and Exclusive Distributors.
5FURTHERMORE, I am executing this certification for whatever legal purposes it
may serve our firm and the undersigned.
Powerline Manufacturing Industry
By:
(Sgd.)
FRANCISCO R. CUNANAN
Manufacturer29
The Certification is dated "January 1988," making it appear that it had been issued
before the subject fire extinguishers were purchased on June 27, 1989. However,
Cunanan could not have executed the Certification in January 1988 because
paragraph 4 thereof indicates that it was issued pursuant to "COA Circular No. 91-
368." It bears stressing that COA Circular No. 91-368 was issued only on
December 19, 1991, long after Cunanan signed the Certification. In fine, Cunanan
could not possibly have issued a certification pursuant to an administrative circular
which did not as yet exist. Hence, no such certification was issued on June 27,
1989, the most plausible explanation being that it was executed and signed by
Cunanan only after December 19, 1991. Besides, the petitioner never submitted
the certification when the auditing team conducted its investigation. If the
certification was indeed issued as early as January 1988, the petitioner should
have submitted the same to the auditing team. The trial court saw through the
petitioner’s chicanery and declared in its decision:
Accused Oani submitted for the purpose a Certification dated 10 July 1988 issued
by the Panabo Fire Station, Panabo, Davao and the Certification dated January
1988, issued by a certain Francisco R. Cunanan, proprietor of Powerline, that the
latter is an exclusive distributor of the purchased fire extinguishers and that no
subdealer was appointed to sell the same.
After a careful evaluation of the respective evidences submitted by the parties on
this issue, the Court finds for the People and brushes aside as incredible the
claims of the defense, particularly of the accused Oani. It appears that the theory
of the accused that bidding and canvass may be dispensed with in view of the
exclusiveness of Powerline in the manufacture and distribution of the purchased
fire extinguishers, finds no leg to stand on, at the least, or a mere afterthought, at
the most. The penultimate paragraph of the said certification
of Powerline proprietor, Francisco R. Cunanan, states,
"THAT, I am executing this Certification pursuant to Article 7, section 442 of the
Government Auditing Rules & Regulations (GAAM Volume I under COA Circular
No. 91-368 governing the procurement from Duly Licensed Manufacturers and
Exclusive Distributors)."
Indeed, the GAAM was implemented by COA Circular No. 91-368. The latter,
which was issued on December 19, 1991, provided in the last paragraph thereof
that the GAAM was to take effect on January 1, 1992. The glaring inconsistency in
the said Certification is that at the time it was issued, i.e., on January 1988, the
GAAM was not yet in existence. Hence, contrary to the testimony of accused Oani,
the Certification of Mr. Cunanan must have been issued only after December 19,
1991, the date of issuance of COA Circular No. 91-368, and necessarily, after the
publication of the special audit Report (Exhibit "B").
… were admitted by both accused Oani and Roa, reveals that indeed, the signatures
Further, had the said certification been the basis of accused Oani in approving the
negotiated purchase, he could have easily presented the same to the team in the
course of their investigation. But quite to the contrary, it was not even mentioned in
the "management comment" portion of the Report, which states:
"Management Comments:"
"When the Principal of the Panabo High School was made to comment on this
particular finding, he submitted a written justification that the purchase of the fire
extinguishers was made due to the persuasion of the Resident Auditor assigned in
that agency. As per his letter, he contended that the purchase of the said
equipment was done only and after being recommended by the Resident Auditor."
… contrary. Thus, the portion of his Affidavit dated March 10, 1990, which was the
The records are bereft of even the slightest suggestion of any ill-motive on the part
of the team, which would justify Us to suspect that the members of
the team maliciously omitted to consider such an important document constituting
the defense of the accused. Thus,
…
Otherwise stated, accused Oani cannot have Us believe that Exhibit "2," which
made reference to COA Circular No. 91-368 issued only on December 19, 1991,
was already existing at the time the nine (9) fire extinguishers were bought way
back in 1989. Now, in the absence of a certification of "exclusivity," it would be
grossly negligent, if not naivete on the part of accused Oani, to rely on the verbal
representations of the Powerline Manufacturer. Besides, this certification was an
indispensable documentary support in the approval of the disbursement voucher
considering that the transaction was a mere exception to the general requirement
of bidding and canvass.30
On the purchase of the stereo component and school and office supplies, we
agree with the trial court’s ruling that based on the evidence, the Bids and Awards
Committee failed to conduct any canvass and public bidding as mandated by law:
On the matter before Us, accused Oani testified that the bidding committee was
chaired by him and some instances co-chaired by Mr. Domingo Bugtungan, with
Mrs. Sayoma and Mr. Campang as members. Further, during the opening of the
bids, the suppliers were present. A cursory examination of the various Invitations
to Bid, which were used as bid forms, the Canvass Forms, the existence of which
of the bidding committee members, other than that of accused Oani, do not
appear. As correctly observed by the team in their Report, this was "unusual." The
affixing of signatures by the committee members are not mere ceremonial acts but
proofs of authenticity and marks [of] regularity. The absence of such signatures not
only in some, but in ALL the Invitations to Bid and Canvass Forms indicate
something more than mere honest and unintentional omissions. These uniform
omissions collectively suggest a pattern of scheme tainted with ulterior motives,
and altogether doubts the authenticity of the supposed bidding or canvass.
The significance of the testimony and affidavit of state witness Edilberto Lacdao
regarding the purchase of the sound system, can hardly be ignored. As property
custodian and teacher of Panabo High School before and during the purchase and
delivery of the sound system, subject of the Sales Invoice dated December 29,
1989 in the amount of ₱35,690.00, his personal knowledge of the circumstances
surrounding the acquisition cannot be doubted, there being no showing to the
basis of his testimony, states:
"That I and Mr. Paculangan, teacher, Panabo High School, Panabo, Davao
prepared the RIV for the following:
a. 1 unit amplifier 200 watts
b. 2 units electric bell
c. 1 unit trumpa-loudspeaker
d. 2 units megaphone
e. 1 unit tape deck"
"That I gave the filled-up RIV and canvass forms to Mr. Antonio Moraleda of ASM
Enterprises who happened to be in school, thinking that he will give us the
quotation of the items;"
"That the RIV was changed as what had been previously prepared and that the
delivered items found in the revised RIV were the following:
a. 1 unit sound research SR 100 A 200 Watts
b. 1 unit sound research 6 mic mixer
c. 2 units L 2" 3-way speaker system
d. 1 unit Radio Cassette Recorder
e. 1 unit Phono Magnetic
f. 2 units microphone and microphone stand with holder
g. 3 units electrical bell 10" in diameter" x x x
"That I personally signed the RIV accepting the equipment." (Italics supplied)
Probative weight may be accorded to these declarations for its candidness and
straightforwardness. In addition, there is no showing in the record that from the
time of its execution, until he testified thereon, Edilberto Lacdao was harboring ill-
feeling or ulterior motives against both or either of the accused. This explains the
absence of the signatures of the other members of the committee on bids and
strongly supports the findings of the special audit team that a simulated bidding
and canvass took place, at least in the purchase of sound system. In this case,
what appears to have transpired was that the RIVs containing the specific items to
be purchased, were prepared by the property officer, who then [gave] them to the
favored suppliers, together with blank canvass forms. The suppliers would then
return the RIVs and the canvass forms to the property officer, which by then, have
already been filled up with inflated quotations by other enterprises showing the
favored suppliers as having quoted the lowest prices. What follows is a matter of
clerical documentation to make it appear that bidding and canvass was validly
conducted. In the case of the sound system, it was even the supplier, ASM
Enterprises which modified the contents of the RIV. This very same inference may
be made from the testimony of Edilberto Lacdao on cross-examination, that he
could not remember Panabo High School having conducted bidding or canvass
from 1984 to 1989.
In consciously allowing the suppliers to violate the requirements of bidding and
canvass, accused Oani brazenly undermined the objective of the process,
namely, "To protect the public interest by giving the public the best possible
advantage thru open competition." Hence, not only did he act in a "wantonly
careless manner" but also in an unspeakable "breach of duty in a flagrant and
palpable" way. In full contemplation of the law, his acts constitute gross
inexcusable negligence.
As occasioned by the lack of bidding and canvass, unqualified and non-bona fide
entities that only served as brokers, gained entry and participation to the
transaction. Not only did this burden the government with additional costs, as a
result, but also exposed it to unnecessary risks and disadvantages. Firsthand
investigation and audit conducted by the COA auditors revealed the following:
"The overpricing of purchases was obviously the result of exaggerated or inflated
price quotations made by non-bona fide dealers or ‘middlemen’ of equipment,
supplies and materials of which the agency had contracted with. By using non-
existing firms or establishment who were made to appear in the records as the
competing bidders with higher quoted prices than those offered by the non-bona
fide dealers, it had paved the way for those unscrupulous bidders to win the
bidding. This is the plain and flagrant simulation and manipulation of canvass to
the detriment of the government."
"Thus, the participation of non-bona fide dealers in the transactions of the agency
was allowed through the simulated canvass. This was further confirmed by
personnel involved in the procurement system of the agency when they claimed
during the exit Conference that usually they gave the Request and Issue Voucher
(RIV) to a certain dealer and the same dealer should be the one to process the
documents needed for the purchase. This procedure was facilitated with the
influence of some officials of the agency who are clothed with the power to decide
over and above the same involving the MOOE funds of the agency. These officials
were definitely and particularly identified in the affidavits executed by the
designated accountable personnel in the agency which are made as appendices to
this report."
"Furthermore, per inquiry made by the team, two business establishments
particularly the ASM Enterprises and the Red Lion Marketing in Davao City who
were often made as the winning bidders of the rigged and/or simulated
canvasses/biddings and had mostly supplied the agencies’ needs for office and
sound equipment, supplies and materials, were not dealers of such line
commodities. This was validated in one of our unexpected visits to their
establishments where we had observed that there were no stocks and/or displays
of such commodities or merchandise as what had been delivered to the agency."
"Per observation, the general outside and inside appearance of these two
establishments are: Red Lion Marketing portrays an ordinary office while ASM
Enterprises appears as an ordinary residential house and yet these establishments
were considered by management in the canvassing of prices for the procurement
of equipment, supplies and materials. The team could not find any valid reason
why management failed to consider in the canvassing of prices known
establishments in the main streets of Davao City, and those who are distinctly
identified to be dealing with the sound and office equipment, supplies and
materials."
"Likewise, certification issued by the Business Bureau, Davao City (See Appendix
2) showed that the ASM Enterprises and Red Lion Marketing declared
capitalization of ₱20,000.00 and ₱40,000.00 in 1988, respectively, as against the
contracts they entered into with the government which is invariably more than their
capitalization. Red Lion could also be declared a non-bona fide dealer on the
ground of non-payment of the business taxes for the year 1989, thereby disproving
their license to operate for that year." (Italics supplied)
Accused Oani and Roa did not dispute the foregoing findings of the team, much
less present rebuttal evidence. Instead, they elicited the stipulation from the
prosecution "that the purchased equipment, supplies and other materials were
delivered to the Panabo High School," which the prosecution readily admitted
during the pre-trial. The fact that the subject inventories have been delivered would
have been a potent defense of the accused in the instant case had the purchases
not resulted into other forms of injuries to the government – which brings us into
the matter of overpricing.31
As against the findings of the trial court supported by the evidence on record, the
petitioner offered nothing but his barren testimony. The petitioner also failed to
offer any evidence except his bare denial to the following findings of the trial court:
In the purchase of the sound system, covered by the purchase order dated
December 28, 1989, signed by accused Oani, the unit price of a "microphone
stand with holder" is ₱2,295.00. The same could have been bought from the
suppliers participating in the re-canvass anywhere from ₱195.00 to ₱804.00,
enabling the government to save by more than 50%. Similarly, a "10 in. diameter
electronic bell" was bought from ASM Marketing for ₱525.00 per unit, compared to
the selling prices of participating suppliers in the re-canvass, ranging from ₱185.00
to ₱245.00 only, showing more than 50% difference.
In the acquisition of various office supplies and equipment by Panabo High School
from Red Lion Marketing in the total amount of ₱111,912.35, as shown in the
undated purchase order issued by accused Oani and the corresponding Sales
Invoice of Red Lion Marketing dated March 10, 1989 the price of one steel safe
was ₱11,600.00. After the re-canvass, it was discovered that similar items may be
bought from reputable suppliers in Davao City from ₱7,800.00 to ₱8,620.00 only.
Likewise, a unit of "steel cabinet combination four drawers" purchased from Red
Lion Marketing for ₱11,000.00 was sold by reputable suppliers anywhere from
₱5,000.00 to ₱6,000.00 only. Again, a "steel cabinet four drawers," sold for
₱4,400.00 by Red Lion, was quoted by bona fide suppliers from ₱2,250.00 to
₱2,750.00. This rate of overpricing very well applies to other items in the said
purchase order and sales invoice.
In the subsequent purchase of various school supplies in the total amount of
₱37,686.00 on or about December 26, 1989 again, from ASM Enterprises,
enumerated in its Sales Invoice dated December 22, 1989, we find further inflated
prices. Thus, while the 500 pieces of "long brown folder" were sold by ASM
Enterprises at ₱2.25 each, other reputable suppliers in Davao City were selling the
same from ₱1.50 to ₱1.90 each, as of March 21, 1990. In the same vein, ASM
Enterprises sold 300 boxes of "Venus Yellow Enamel Chalk" to Panabo High
School for ₱28.50 per box. After the re-canvass, it was found out that the same
item may be bought for ₱25.00 per box. Again, ASM Enterprises sold to Panabo
High School 10 dozens of "Max Staple Wire No. 10" for ₱79.80 per dozen, while
other suppliers were selling them at ₱37.00 to ₱39.00 per dozen, for a difference
of more than 50%.32
In Danville Maritime, Inc. v. Commission on Audit,33 the Court emphasized that –
… By its very nature and characteristic, a competitive public bidding aims to
protect the public interest by giving the public the best possible advantages thru
open competition. Another self-evident purpose of public bidding is to avoid or
preclude suspicion of favoritism and anomalies in the execution of public contracts.
Public bidding of government contracts and for disposition of government assets
have the same purpose and objectives. Their only difference, if at all, is that in the
public bidding for public contracts the award is generally given to the lowest bidder
while in the disposition of government assets the award is to the highest bidder.34
In a public bidding, there must be competition that is legitimate, fair and honest.
The three principles of a public bidding are the offer to the public; an opportunity
for competition; and a basis for exact comparison of bids.35 A contract granted
without the competitive bidding required by law is void, and the party to whom it is
awarded cannot benefit from it.36
In the present case, the petitioner purchased the fire extinguishers and office and
school supplies without the benefit of a public bidding, in gross and evident bad
faith, resulting in the considerable overpricing of the fire extinguishers and the
supplies, to the gross prejudice of the government.
In sum then, the decision of the trial court is in accord with the law and the
evidence.

IN LIGHT OF ALL THE FOREGOING, the petition is DENIED. Cost against the
petitioner.

SO ORDERED.