Republic v. Sandiganbayan
REITERATIONFacts
The Antecedents: The Republic, represented by the Presidential Commission on Good Government (PCGG), filed a complaint for sum of money, reconveyance, and enforcement of foreign judgment to recover ill-gotten wealth of former President Ferdinand E. Marcos. The complaint alleged that Traders Royal Bank (TRB) issued banking instruments showing receipt of funds from President Marcos, which TRB refused to honor. The PCGG also alleged that shares of stock in TRB, initially owned by Royal Bank of Canada and later sold to Banque de Paris et des Pays Bays (Suisse) SA, were in reality purchased by President Marcos and Ambassador Roberto S. Benedicto, and thus constituted ill-gotten wealth. TRB later changed its name to Royal Traders Holding Co., Inc. (RTHCI), and subsequently, Bank of Commerce allegedly purchased RTHCI. The PCGG amended its complaint to implead RTHCI and Bank of Commerce, alleging that the amendment and sale were intended to mingle TRB's assets with Bank of Commerce's to evade obligations to the government. Procedural History: The PCGG presented witnesses Reynaldo Guiao, Eleuterio Camarote, and Julieta Bertuben. The Sandiganbayan initially denied the PCGG's prayer to consider the previously presented testimonial and documentary evidence against the newly impleaded defendants, RTHCI and Bank of Commerce, on the ground that it would violate Bank of Commerce's right to cross-examination. The Sandiganbayan ruled that the PCGG needed to recall its witnesses to afford Bank of Commerce the right to cross-examine them. Despite this, the PCGG manifested its intent to adopt the previous testimonies. Bank of Commerce manifested its need to cross-examine. However, on scheduled hearing dates, the PCGG repeatedly manifested that the witnesses were unavailable, as they could no longer be located. Consequently, Bank of Commerce moved to strike out the testimonies. The Sandiganbayan granted the motion, finding that Bank of Commerce was denied the opportunity to cross-examine and was not negligent or in delay. The PCGG's motion for reconsideration was denied. The Petition: The Republic, through the PCGG, filed a Petition for Certiorari under Rule 65, seeking to nullify the Sandiganbayan's Resolutions, alleging grave abuse of discretion for ordering the striking out of the testimonies.
Issue(s)
Whether the Sandiganbayan committed grave abuse of discretion in ordering the testimonies of witnesses Guiao, Camarote, and Bertuben to be stricken off the record with respect to the Bank of Commerce. Whether the Bank of Commerce, as alleged successor-in-interest of Traders Royal Bank (TRB), should be bound by the cross-examination conducted by TRB; and whether Bank of Commerce waived its right to cross-examine.
Ruling
The petition is dismissed for lack of merit. The Resolutions dated September 25, 2013, and March 25, 2014, of the Sandiganbayan 2nd Division in Civil Case No. 0181 are affirmed.
Ratio Decidendi
On the issue of whether the Sandiganbayan committed grave abuse of discretion in ordering the testimonies to be stricken off the record: The Court affirmed the Sandiganbayan's ruling. The right to cross-examine is an essential component of due process, applicable in civil litigation. Section 6, Rule 132 of the Rules of Court explicitly states the purpose and extent of cross-examination. The PCGG's argument that Bank of Commerce should be bound by TRB's cross-examination due to alleged identity of interests or corporate succession was not sufficiently established. The Court reiterated that for the testimony of a witness to be admissible in a later proceeding against a new party, there must be substantial identity or identity of interests, or privity between the parties. The PCGG failed to prove such identity of interest or privity between TRB and Bank of Commerce. Bank of Commerce explicitly denied being the successor-in-interest and presented defenses showing distinct corporate personalities and the absence of asset mingling. Therefore, to bind Bank of Commerce by TRB's actions would be to prejudge a determinative issue in the case. On the issue of whether Bank of Commerce, as alleged successor-in-interest of Traders Royal Bank (TRB), should be bound by the cross-examination conducted by TRB; and whether Bank of Commerce waived its right to cross-examine: The Court found no reason to disturb the Sandiganbayan's findings that Bank of Commerce did not waive its right. The essence of the right to cross-examination is the opportunity, not the actual exercise thereof. While the right can be waived, Bank of Commerce expressly manifested its intention to cross-examine. The repeated postponements of trial schedules were not due to Bank of Commerce's fault or negligence but rather due to the PCGG's failure to present its witnesses. The PCGG, having presented the witnesses on direct examination, had the duty to make them available for cross-examination. The Court held that Bank of Commerce should not suffer due to the PCGG's repeated failure to present its witnesses. Consequently, the absence of the opportunity to cross-examine renders the testimony incomplete and inadmissible as to Bank of Commerce, citing Ortigas, Jr. v. Lufthansa German Airlines.
Main Doctrine
The right to cross-examine is an essential component of due process. If a party is denied the opportunity to cross-examine witnesses due to the fault of the offering party, the testimonies of those witnesses are rendered incompetent and must be stricken off the record with respect to that party.