Presidential Commission on Good Government v. Tan
REITERATIONFacts
The Antecedents: The Presidential Commission on Good Government (PCGG) issued sequestration orders against shares of stock of respondents in various corporations, including Allied Banking Corporation, Foremost Farms, Inc., Fortune Tobacco Corporation, and Shareholdings, Inc., in 1986 and 1987. Respondents filed petitions to lift these orders, and when the PCGG did not act, they filed petitions for certiorari, prohibition, and injunction with the Supreme Court. These petitions were later referred to the Sandiganbayan. Procedural History: The Sandiganbayan, in Civil Cases Nos. 0095 and 0100, nullified the PCGG's sequestration orders and search and seizure order, respectively. On appeal, the Supreme Court affirmed these rulings. Subsequently, in Civil Cases Nos. 0096-0099, the Sandiganbayan declared the writs of sequestration against respondents' shares in Allied Banking Corporation, Foremost Farms, Fortune Tobacco Corporation, and Shareholdings, Inc. void for lack of a prima facie factual foundation that the properties were ill-gotten wealth. The PCGG filed a motion for reconsideration, which was denied. The Petition: The PCGG filed a Petition for Review on Certiorari before the Supreme Court, assailing the Sandiganbayan's Joint Decision and Resolution, raising grounds related to the Sandiganbayan substituting its judgment for the PCGG's, ignoring evidence of a prima facie determination, and contravening law and jurisprudence.
Issue(s)
Whether the Sandiganbayan substituted its own judgment for that of the PCGG, encroaching on the latter's administrative competence. Whether facts and documents indubitably showing that the PCGG made a prima facie factual determination on the ill-gotten nature of the properties involved before issuing the writs of sequestration were ignored and discarded, resulting in a deprivation of the PCGG's right to due process. Whether the lifting of the sequestration orders by the Sandiganbayan, despite its declaration that the bulk of the respondent's documents tended to show proof of ill-gotten wealth, contravened the law and applicable decisions of the Supreme Court. Whether the petitioner is entitled to a temporary restraining order and/or writ of preliminary injunction.
Ruling
The Supreme Court DENIED the petition and AFFIRMED the assailed Joint Decision and Resolution of the Sandiganbayan in Civil Cases Nos. 0096, 0097, 0098 and 0099. The writs of sequestration issued by the PCGG were declared void and of no legal effect.
Ratio Decidendi
On the issue of the Sandiganbayan substituting its judgment for the PCGG's administrative competence: The Court held that when a court nullifies a sequestration order for lacking a prima facie showing that the properties are ill-gotten wealth, it is not substituting its judgment but applying the law. The right of owners to contest sequestration orders, as acknowledged in jurisprudence, necessitates judicial review. The PCGG's argument invoking PCGG v. Peña was distinguished as that case involved RTC jurisdiction, whereas the assailed decision was from the Sandiganbayan. On the issue of whether a prima facie factual determination was ignored and due process was violated: The Court found that the PCGG failed to present evidence demonstrating a prima facie factual foundation for the sequestration orders. The minutes of the PCGG meetings, while numerous, did not reflect deliberations establishing that the sequestered shares were ill-gotten wealth. The definition of "ill-gotten wealth" requires proof of acquisition through improper use of government funds or undue advantage of official position, which was not evidenced by the PCGG. The Court emphasized that the opportunity to contest sequestration orders would be meaningless without a record for reviewing authorities to determine if the PCGG acted with grave abuse of discretion. On the issue of whether lifting the sequestration orders contravened law and jurisprudence despite documents tending to show ill-gotten wealth: The Court clarified that the Sandiganbayan's statement regarding the "bulk of the respondent’s documents" was made in the context of those documents not establishing a prima facie factual foundation for the issuance of the sequestration orders. These documents were deemed irrelevant to the issue of whether the PCGG had a basis for sequestration at the time of issuance, and their relevance to determining actual ill-gotten wealth in a separate case was acknowledged. The core issue remained the lack of a prima facie factual basis for the sequestration itself. On the issue of entitlement to a temporary restraining order and/or writ of preliminary injunction: Given the Sandiganbayan's finding, which the Supreme Court sustained, that the sequestration orders were not based on a prima facie factual foundation, this ground was deemed misplaced. The Court reiterated that the sequestration orders were void and had no legal effect, thus negating the need for injunctive relief to preserve the status quo.
Main Doctrine
Writs of sequestration issued by the Presidential Commission on Good Government (PCGG) must be based on a prima facie factual foundation that the properties sequestered are ill-gotten wealth. The PCGG must present evidence demonstrating deliberations and factual bases for such issuance, not merely conclusions, to satisfy due process requirements.