Saavedra v. Department of Justice
REITERATIONFacts
The Antecedents: Petitioner Honorio Saavedra, Jr. purchased shares of stock in Pine Philippines, Inc. (PPI) from its owners, including private respondent Gregorio M. Ramos, for P1.2 million, payable in installments. A Memorandum of Agreement and a Deed of Assignment were executed, with the former containing an automatic rescission clause for non-payment. Petitioner paid P936,380.00, leaving a balance of P263,620.00. Petitioner withheld the balance, citing sellers' failure to comply with warranties, and deposited it in escrow. Procedural History: On November 5, 1987, petitioner filed a civil complaint for damages against Ramos, alleging he was the President of PPI. Ramos questioned petitioner's capacity to sue, claiming the sale was automatically rescinded on September 15, 1987, due to non-payment. Ramos and his group filed a case with the Securities and Exchange Commission (SEC) to declare the rescission valid. Petitioner's motion to dismiss for lack of jurisdiction was denied, and the Supreme Court upheld the SEC's jurisdiction over intracorporate disputes concerning ownership and automatic rescission. Proceedings in the civil case were suspended. On December 7, 1987, Ramos filed a criminal case for perjury against petitioner, alleging petitioner falsely declared himself President of PPI in the verification of his civil complaint. The Provincial Prosecutor found a prima facie case for perjury and filed an Information. The evidence included a Secretary's Certificate dated December 5, 1987, showing Ramos' election as President after the alleged rescission. Petitioner sought review from the Department of Justice (DOJ), which dismissed his Petition for Review, affirming the finding of probable cause for perjury. The DOJ denied reconsideration. The Petition: Petitioner filed a petition for certiorari and prohibition seeking to nullify the DOJ Resolutions, arguing that the DOJ gravely abused its discretion in affirming the finding of probable cause for perjury, as the issue of automatic rescission was within the SEC's primary and exclusive jurisdiction and had not yet been resolved.
Issue(s)
Whether the Department of Justice committed grave abuse of discretion in affirming the finding of probable cause for perjury against the petitioner. Whether the Provincial Prosecutor had the authority to rule on the issue of automatic rescission of the sale of shares, which is an intracorporate dispute within the exclusive jurisdiction of the Securities and Exchange Commission. Whether the elements of perjury are present in the petitioner's sworn statement, particularly the willful and deliberate assertion of falsehood and the requirement of verification by law.
Ruling
The petition is GRANTED. The questioned Resolutions of the Department of Justice are NULLIFIED and SET ASIDE. The Regional Trial Court of Pasig is directed to DISMISS Crim. Case No. 74919.
Ratio Decidendi
On the issue of grave abuse of discretion: The Court found that the finding of probable cause was bereft of factual and legal bases, constituting grave abuse of discretion because the Secretary's Certificate, which formed the basis of the charge, was dated after the alleged false statement was made, rendering it incapable of proving the truthfulness of a statement made prior to its existence. On the issue of jurisdiction and the Provincial Prosecutor's authority: The Supreme Court held that the Provincial Prosecutor, in determining probable cause for perjury, cannot arrogate unto himself the jurisdiction vested solely with the Securities and Exchange Commission (SEC) to rule on intracorporate disputes, including issues of ownership and automatic rescission. The Court reiterated its pronouncement in Saavedra, Jr. v. SEC that such disputes fall under the primary and exclusive jurisdiction of the SEC pursuant to P.D. No. 902-A. The doctrine of primary jurisdiction dictates that courts cannot resolve a controversy within the jurisdiction of an administrative tribunal. Therefore, the Provincial Prosecutor should have withheld filing the information until the SEC resolved the issue of automatic rescission. Sanctioning the DOJ Resolutions would mean sanctioning a usurpation of the SEC's primary and exclusive jurisdiction. On the elements of perjury: The Court found that even if the SEC were to rule adversely against the petitioner, the charge for perjury might still not prosper. Firstly, the prosecution failed to show that the alleged falsehood was willful and deliberate. The records suggested the assertion was made in good faith, believing non-payment was justified by the sellers' non-compliance with warranties, and the balance was deposited in escrow. Secondly, the Court noted that pleadings for damages are not generally required by law to be verified. Since the complaint filed by petitioner was not mandated by law to be verified, another essential element of perjury – that the sworn statement is required by law – is absent.
Main Doctrine
The Provincial Prosecutor, in determining probable cause for perjury, cannot arrogate unto himself the jurisdiction vested solely with the Securities and Exchange Commission (SEC) to rule on intracorporate disputes, including issues of ownership and automatic rescission. Furthermore, a charge for perjury cannot prosper if the alleged false statement was made in a pleading not required by law to be verified, or if the falsehood was not willful and deliberate.