Republic v. Cojuangco
REITERATIONFacts
The Antecedents: Respondents incorporated United Coconut Oil Mills, Inc. (UNICOM) in 1977. Subsequently, UNICOM amended its capitalization multiple times. In 1979, the Board of Directors of United Coconut Planters Bank (UCPB), composed of respondents, authorized UCPB to invest not more than ₱500 million from the Coconut Industry Investment Fund (CII Fund) in UNICOM's equity. This investment was allegedly made to benefit coconut farmers. The investment was later converted to Class "A" voting common shares, which allegedly resulted in the government's investment being reduced and benefits being conferred to UNICOM's incorporators. Procedural History: On March 1, 1990, the Office of the Solicitor General (OSG) filed a complaint with the Presidential Commission on Good Government (PCGG) against the 1979 UCPB board members for violation of Section 3(e) of Republic Act (R.A.) 3019. The PCGG referred the complaint to the Office of the Ombudsman. The Office of the Special Prosecutor (OSP) found sufficient basis to indict but recommended dismissal due to prescription. The Office of the Ombudsman approved the dismissal, ruling that the action had prescribed. The OSG's motion for reconsideration was denied. The Petition: The Republic of the Philippines filed a petition for review on certiorari under Rule 45, which the Supreme Court treated as a special civil action for certiorari under Rule 65, imputing grave abuse of discretion to the Ombudsman for dismissing the complaint.
Issue(s)
Whether the prosecution of the alleged violation of Section 3(e) of R.A. 3019 has prescribed. Whether the constitutional provision on the State's right to recover unlawfully acquired properties is applicable to criminal cases.
Ruling
The petition is denied, and the Memorandum dated May 14, 1999, of the Office of the Ombudsman, which dismissed the charge of violation of Section 3(e) of R.A. 3019 on the ground of prescription, is affirmed.
Ratio Decidendi
On the issue of prescription: The Court held that the prosecution of the alleged violation of Section 3(e) of R.A. 3019 had prescribed. The prescriptive period for offenses under R.A. 3019, as originally enacted and applicable to the acts complained of (committed before March 16, 1982), was 10 years. This period is computed in accordance with Section 2 of Act 3326, which states that prescription begins to run from the day of the commission of the violation or from its discovery, if not known at the time, and the institution of judicial proceedings for its investigation and punishment. The Court found that the investment in UNICOM was a publicly recorded transaction, not a concealed one like behest loans. UNICOM's application with the Securities and Exchange Commission (SEC) for increased capitalization made the investment accessible to the public. Therefore, the discovery rule, which tolls prescription in cases of concealed transactions, was not applicable. The OSG had knowledge of the investment for a considerable time before filing the complaint, and the prescriptive period had already expired. The Court emphasized the importance of prescription as a rule of fairness, preventing defendants from being deprived of defenses due to the passage of time. On the applicability of Section 15, Article XI of the 1987 Constitution: The Court reiterated that Section 15, Article XI of the 1987 Constitution, which provides that the State's right to recover unlawfully acquired properties is not barred by prescription, laches, or estoppel, applies only to civil actions for recovery of ill-gotten wealth and not to criminal cases. Therefore, the prosecution of offenses arising from, relating to, or involving ill-gotten wealth may still be barred by prescription.
Main Doctrine
The prosecution of offenses under R.A. 3019, even if related to ill-gotten wealth, is subject to prescription. The prescriptive period for offenses committed before the amendment of R.A. 3019 by B.P. Blg. 195 is 10 years, computed from the commission of the violation or its discovery, whichever is later, in accordance with Section 2 of Act 3326. The discovery rule, as applied to behest loans, does not apply to corporate investments that are publicly recorded.