Presidential Ad Hoc Fact-Finding Committee v. Desierto
REITERATIONFacts
1. The Antecedents: This case concerns loans granted by the National Investment and Development Corporation (NIDC) to Mindanao Coconut Oil Mills (MINCOCO), a corporation whose stockholders and officers included respondents Mohammad Ali Dimaporo, Abdullah Dimaporo, and Amer Dianalan. MINCOCO obtained Guarantee Loan Accommodations from NIDC in 1976, despite being undercapitalized and under-collateralized. Subsequent interventions, including a marginal note from the late President Ferdinand E. Marcos, prevented the foreclosure of MINCOCO's mortgage liens by government banks, effectively releasing the corporation and its owners from financial liabilities. These transactions were later identified as potential behest loans by the Presidential Ad Hoc Fact--Finding Committee on Behest Loans. 2. Procedural History: The Presidential Ad Hoc Fact--Finding Committee on Behest Loans filed a sworn complaint with the Ombudsman against MINCOCO's officers and NIDC's Board of Directors for violations of Republic Act No. 3019. The Ombudsman, on July 9, 1998, motu proprio dismissed the complaint, citing insufficient evidence and prescription of the alleged offenses. The Ombudsman reasoned that the loans were approved based on sound lending practices, that claims of cronyism were unsubstantiated, and that President Marcos' marginal note pertained to the release of liabilities, not the loan approval itself. The Ombudsman also concluded that the offenses, committed in 1976, had prescribed ten years later under the old R.A. No. 3019, as the complaint was filed in 1997. 3. The Petition: The Presidential Ad Hoc Fact--Finding Committee on Behest Loans filed this petition for review on certiorari under Rule 45 of the Rules of Court, arguing that the State's right to recover ill-gotten wealth is imprescriptible under the Constitution and that, even if subject to prescription, the period should be counted from the discovery of the behest loans in 1992. The Committee contended that the Ombudsman committed grave abuse of discretion in dismissing the complaint. The Supreme Court treated the petition as one for certiorari under Rule 65, finding that the prescriptive period should commence from the discovery of the loans in 1992, not from their commission in 1976, due to the nature of behest loans and the difficulty of discovery during the previous regime. The Court also found that the Ombudsman's dismissal for insufficiency of evidence constituted grave abuse of discretion, given the circumstances indicating potential violations of R.A. No. 3019.
Issue(s)
Whether the Ombudsman committed grave abuse of discretion in dismissing the complaint on the grounds of prescription and insufficiency of evidence. Whether the prescriptive period for offenses under Republic Act No. 3019, committed in 1976, began to run from the date of commission or from the date of discovery. Whether the constitutional provision on imprescriptibility of ill-gotten wealth applies to criminal cases. Whether there was sufficient evidence to establish probable cause for violations of Sections 3(e) and (g) of Republic Act No. 3019.
Ruling
The petition is GRANTED. The Resolution of the Ombudsman dismissing the complaint is REVERSED and SET ASIDE. The Ombudsman is ORDERED to dismiss the complaint against the deceased respondent Conrado S. Reyes, require proof of death for respondents Panfilo O. Domingo and Mohammad Ali Dimaporo, and file the necessary Information against respondents Abdullah Dimaporo, Amer Dianalan, Enrique M. Herboza, and Ricardo Sunga with the Sandiganbayan.
Ratio Decidendi
On the issue of grave abuse of discretion and the Ombudsman's dismissal: The Court held that while the Ombudsman has discretionary power, its actions are subject to judicial review for grave abuse of discretion. The Court found that the Ombudsman gravely abused its discretion in dismissing the complaint, particularly concerning the prescription of offenses and the assessment of evidence. The Ombudsman's dismissal was deemed arbitrary given the circumstances surrounding the behest loans, which involved presidential intervention and clear deviations from sound banking practices. On the prescription of offenses: The Court reiterated that the prescriptive period for offenses under Republic Act No. 3019, prior to its amendment by Batas Pambansa Blg. 195, is ten (10) years. However, applying Section 2 of Act No. 3326, the Court held that for violations of special laws that were not known at the time of their commission, the prescriptive period begins to run from the date of discovery. The Court found that the behest loans were discovered in 1992 when the Committee was formed, and the complaint was filed in 1997, well within the ten-year prescriptive period from the date of discovery. The rationale was that during the Marcos regime, it was impossible for the State to discover these crimes due to alleged connivance and conspiracy, and no one would have dared to question the legality of these transactions. On the imprescriptibility of ill-gotten wealth: The Court clarified that Section 15, Article XI of the 1987 Constitution, which states that the right of the State to recover unlawfully acquired properties shall not be barred by prescription, laches, or estoppel, applies only to civil actions for the recovery of ill-gotten wealth and not to criminal cases. Therefore, the criminal charges were subject to prescription. On the sufficiency of evidence and probable cause: The Court found that the Ombudsman gravely abused its discretion in dismissing the complaint for insufficiency of evidence. The Committee's findings, which included MINCOCO being under-capitalized and under-collateralized, officers being identified as cronies, President Marcos' marginal note waiving liabilities, and the extraordinary speed of loan approval, should have been accorded respect. The Court emphasized that a finding of probable cause requires only evidence showing that more likely than not, the accused committed the crime, and a preliminary investigation is not the occasion for a full display of evidence. The waiver of MINCOCO's multi-peso loan and the extension of a loan guarantee despite MINCOCO's financial weakness should have been sufficient grounds to find probable cause for violations of Sections 3(e) and (g) of Republic Act No. 3019. The Court noted that violations of Section 3(e) of Republic Act No. 3019 require undue injury or unwarranted benefits, while Section 3(g) focuses on contracts or transactions manifestly and grossly disadvantageous to the government, regardless of personal profit. The circumstances surrounding MINCOCO's loans, including presidential intervention and the extension of loans to an undercapitalized and under-collateralized entity, strongly indicated potential violations of these provisions. The Court highlighted that these behest loans "bled white the economy of the country," underscoring the gravity of the offenses and the Ombudsman's duty to be proactive in investigating such matters.
Main Doctrine
The prescriptive period for offenses under Republic Act No. 3019, when the violation was not known at the time of commission, begins to run from the date of discovery of the unlawful nature of the act or acts, not from the date of commission.