Fact-Finding Committee v. Desierto
REITERATIONFacts
The Antecedents: A complaint was filed before the Office of the Ombudsman against former officers of the Development Bank of the Philippines (DBP) and Pagdanan Timber Products, Inc. (PTPI) for alleged violations of Section 3 (e) and (g) of Republic Act No. 3019 (Anti-Graft and Corrupt Practices Act). The complaint stemmed from a foreign guarantee loan granted by DBP to PTPI in 1974. Petitioners alleged that the loan was a "behest loan" characterized by being undercollateralized, the borrower corporation being undercapitalized, and the loan processing being attended with haste, allegedly at the urging of former President Marcos. PTPI's paid-up capital was P25,000.00, but it obtained a loan of US $13.5 million, with an outstanding balance of P454.85 million as of June 30, 1986. The loan was allegedly secured by assets to be acquired, assignment of forest concessions, and a joint and several undertaking. Procedural History: The Office of the Ombudsman, in a resolution dated October 12, 1998, dismissed the complaint, finding no evidence that the loan was granted at the behest of previous government officials, that PTPI complied with capital increase requirements, that the loan was undercollateralized, and that the complaint was barred by prescription. A motion for reconsideration was denied on January 5, 1999. The Petition: The Presidential Ad Hoc Fact-Finding Committee on Behest Loans and the Presidential Commission on Good Government filed a petition for certiorari before the Supreme Court, seeking to nullify the Ombudsman's resolution and order, alleging grave abuse of discretion.
Issue(s)
Whether the Ombudsman committed grave abuse of discretion in holding that the offenses charged had already prescribed. Whether the Ombudsman committed grave abuse of discretion in dismissing the complaint for lack of probable cause to indict private respondents for violation of Section 3 (e) and (g) of RA 3019.
Ruling
The petition is dismissed. The resolution dated October 12, 1998, and order dated January 5, 1999, of the respondent Ombudsman in OMB-0-98-0364 are affirmed.
Ratio Decidendi
On the issue of prescription: The Court reiterated its ruling in previous cases involving the same petitioners and respondent that for offenses under RA 3019, which is a special law, the prescriptive period is governed by Section 2 of Act No. 3326, as amended. This section provides that prescription begins to run from the day of the commission of the violation, or if the same be not known at the time, from the discovery thereof and institution of judicial proceedings. Given that the alleged violations involved connivance or conspiracy among public officials and private parties, it was "well-nigh impossible" for the State to have known the violations at the time the transactions were made. Therefore, the prescriptive period should be computed from the discovery of the offenses in 1992, after the investigation of the Fact-Finding Committee. Since the complaint was filed in 1998, six years after discovery, prescription had not yet set in. The Ombudsman's finding of prescription was thus erroneous. On the issue of probable cause: The Court found no grave abuse of discretion on the part of the Ombudsman in dismissing the complaint for lack of probable cause. The Ombudsman's reasons were that there was no evidence that the loan was granted at the behest of previous government officials, PTPI complied with the DBP's requirement to increase its paid-up capital, the loan was not undercollateralized, and the complaint was not barred by prescription. The Court elaborated that the loan was secured by assets to be acquired, PTPI's existing properties, the forest concession, and the joint and several signature of Macmillan Jardine, and that the value of these collaterals exceeded the loan amount. Furthermore, PTPI met the capital increase requirement, and the loan proposal was duly studied and evaluated by DBP, with no showing of a lack of sound business judgment. The petitioners failed to point out specific circumstances or overt acts indicating a criminal design or to specify the particular roles of each private respondent. The approval of the loan after five days did not necessarily prove manifest partiality or evident bad faith, as banking laws and procedures were followed. The Ombudsman has wide latitude in exercising his investigatory and prosecutory powers, and his rulings should not be interfered with if supported by substantial evidence.
Main Doctrine
The prescriptive period for offenses under RA 3019, particularly Section 3(e) and (g), commences from the discovery of the commission of the offense, not from the date of commission, especially when the nature of the offense involves connivance or conspiracy making discovery at the time of commission impossible. The Ombudsman's discretion in determining probable cause is wide and should not be interfered with absent grave abuse of discretion.