Carandang v. Desierto
REITERATIONFacts
The Antecedents: Petitioner Antonio M. Carandang (Carandang) was the general manager and chief operating officer of Radio Philippines Network, Inc. (RPN). Carandang was charged with grave misconduct before the Ombudsman for allegedly entering into a contract with AF Broadcasting Incorporated despite being an incorporator, director, and stockholder of the latter, thus holding a financial and material interest in a contract requiring his office's approval, in violation of R.A. 6713. Separately, Carandang was charged before the Sandiganbayan with violation of Section 3(g) of R.A. 3019 for allegedly giving unwarranted benefits to On Target Media Concept, Inc. (OTMCI) by pre-terminating a block time contract and substituting it with a more onerous co-production agreement, causing undue injury to the government. Procedural History: The Ombudsman dismissed Carandang from service for grave misconduct. The Court of Appeals (CA) affirmed the Ombudsman's decision, holding that RPN was a government-owned or controlled corporation (GOCC) because the government's interest amounted to 72.4% of its capital stock, and Carandang, as a presidential appointee, was a public officer. The Sandiganbayan denied Carandang's motion to quash the information, sustaining its jurisdiction over the criminal complaint, also based on the premise that RPN was a GOCC and Carandang was a public official. The Petition: Carandang challenged the jurisdiction of both the Ombudsman and the Sandiganbayan, asserting that RPN was not a GOCC and therefore he was not a public official. He sought the dismissal of both the administrative and criminal complaints.
Issue(s)
Whether the Ombudsman has jurisdiction over Carandang for grave misconduct. Whether the Sandiganbayan has jurisdiction over Carandang for violation of R.A. 3019. Whether RPN is a government-owned or controlled corporation.
Ruling
The Supreme Court granted the petitions. It reversed and set aside the CA decision and dismissed the administrative charge for grave misconduct against Carandang. It also annulled and set aside the Sandiganbayan resolutions and dismissed the criminal case against Carandang.
Ratio Decidendi
On the jurisdiction of the Ombudsman: The Court reiterated that the Ombudsman has jurisdiction over administrative cases involving grave misconduct committed by officials and employees of GOCCs. Since RPN was determined to be a private corporation, Carandang, as an officer of a private entity, was not subject to the Ombudsman's administrative jurisdiction in this context. The Court found Carandang's claim of being a public official by virtue of a presidential appointment to be unsubstantiated, as his designation was a recommendation to the RPN Board of Directors, which ultimately appointed him. On the jurisdiction of the Sandiganbayan: Similarly, the Sandiganbayan has jurisdiction over criminal actions involving violations of R.A. 3019 committed by public officials and employees, including those of GOCCs. As RPN was not a GOCC, Carandang was not a public official within the purview of the Sandiganbayan's jurisdiction for the purposes of R.A. 3019. Consequently, the criminal complaint filed against him before the Sandiganbayan was dismissed for lack of jurisdiction. On the issue of RPN's status as a government-owned or controlled corporation (GOCC): The Court held that a corporation is considered a GOCC only if the Government directly or indirectly owns or controls at least a majority or 51% of its capital stock. In this case, the Government's undisputed share in RPN was only 32.4%. While there was a contested portion of 40% that would bring the total to 72.4%, this claim remained unresolved due to Benedicto's motion for reconsideration. Therefore, without a final judicial determination establishing majority government ownership, RPN could not be classified as a GOCC. The Court noted that both the PCGG and the Office of the President had previously recognized RPN as a private corporation.
Main Doctrine
A corporation is considered a government-owned or controlled corporation (GOCC) only when the Government directly or indirectly owns or controls at least a majority or 51% share of its capital stock. Absent this threshold, it remains a private corporation, and its officers are not subject to the jurisdiction of the Ombudsman and the Sandiganbayan for administrative and criminal cases, respectively, under laws pertaining to public officials.