Crim Cases

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G.R. No. 93028 July 29, 1994

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs.MARTIN SIMON y SUNGA, respondent.

The Solicitor General for plaintiff-appellee.

Ricardo M.Sampang for accused-appellant.

REGALADO, J.:

Herein accused-appellant Martin Simon y Sunga was charged on November 10, 1988 with a violation of Section 4, Article II of Republic Act No. 6425, as amended, otherwise known as the Dangerous Drugs Act of 1972, under an indictment alleging that on or about October 22, 1988, at Barangay Sto. Cristo, Guagua, Pampanga, he sold four tea bags of marijuana to a Narcotics Command (NARCOM) poseur-buyer in consideration of the sum of P40.00, which tea bags, when subjected to laboratory examination, were found positive for marijuana. 1

Eventually arraigned with the assistance of counsel on March 2, 1989, after his rearrest following his escape from Camp Olivas, San Fernando, Pampanga where he was temporarily detained,  2 he pleaded not guilty. He voluntarily waived his right to a pre-trial conference, 3 after which trial on the merits ensued and was duly concluded.

I

The evidence on record shows that a confidential informant, later identified as a NARCOM operative, informed the police unit at Camp Olivas, San Fernando, Pampanga, of the illegal drug activities of a certain "Alyas Pusa" at Sto. Cristo, Guagua, Pampanga. Capt. Francisco Bustamante, Commanding Officer of the 3rd Narcotics Regional Unit in the camp, then formed a buy-bust team composed of Sgt. Buenaventura Lopez, Pfc. Virgilio Villaruz and Sgt. Domingo Pejoro, all members of the same unit. After securing marked money from Bustamante, the team, together with their informant, proceeded to Sto. Cristo after they had coordinated with the police authorities andbarangay officers thereof. When they reached the place, the confidential informer pointed out appellant to Lopez who consequently approached appellant and asked him if he had marijuana. Appellant answered in the affirmative and Lopez offered to buy two tea bags. Appellant then left and, upon returning shortly thereafter, handed to Lopez two marijuana tea bags and Lopez gave him the marked money amounting to P40.00 as payment. Lopez then scratched his head as a pre-arranged signal to his companions who were stationed around ten to fifteen meters away, and the team closed in on them. Thereupon, Villaruz, who was the head of the back-up team, arrested

appellant. The latter was then brought by the team to the 3rd Narcotics Regional Unit at Camp Olivas on board a jeep and he was placed under custodial investigation, with Sgt. Pejoro as the investigator. 4

Pfc. Villaruz corroborated Lopez' testimony, claiming that he saw the deal that transpired between Lopez and the appellant. He also averred that he was the one who confiscated the marijuana and took the marked money from appellant. 5

Sgt. Domingo Pejoro, for his part, declared that although he was part of the buy-bust team, he was stationed farthest from the rest of the other members, that is, around two hundred meters away from his companions. He did not actually see the sale that transpired between Lopez and appellant but he saw his teammates accosting appellant after the latter's arrest. He was likewise the one who conducted the custodial investigation of appellant wherein the latter was apprised of his rights to remain silent, to information and to counsel. Appellant, however, orally waived his right to counsel. 6

Pejoro also claimed having prepared Exhibit "G", the "Receipt of Property Seized/Confiscated" which appellant signed, admitting therein the confiscation of four tea bags of marijuana dried leaves in his possession. Pejoro likewise informed the court below that, originally, what he placed on the receipt was that only one marijuana leaf was confiscated in exchange for P20.00. However, Lopez and Villaruz corrected his entry by telling him to put "two", instead of "one" and "40", instead of "20". He agreed to the correction since they were the ones who were personally and directly involved in the purchase of the marijuana and the arrest of appellant. 7

Dr. Pedro S. Calara, a medical officer at Camp Olivas, examined appellant at 5:30 p.m. of the day after the latter's apprehension, and the results were practically normal except for his relatively high blood pressure. The doctor also did not find any trace of physical injury on the person of appellant. The next day, he again examined appellant due to the latter's complaint of gastro-intestinal pain. In the course of the examination, Dr. Calara discovered that appellant has a history of peptic ulcer, which causes him to experience abdominal pain and consequently vomit blood. In the afternoon, appellant came back with the same complaint but, except for the gastro-intestinal pain, his physical condition remained normal. 8

As expected, appellant tendered an antipodal version of the attendant facts, claiming that on the day in question, at around 4:30 p.m., he was watching television with the members of his family in their house when three persons, whom he had never met before suddenly arrived. Relying on the assurance that they would just inquire about something from him at their detachment, appellant boarded a jeep with them. He was told that they were going to Camp Olivas, but he later noticed that they were taking a different route. While on board, he was told that he was a pusher so he attempted to alight from the jeep but he was handcuffed instead. When they finally reached the camp, he was ordered to sign some papers and, when he refused, he was boxed in the stomach eight or nine times by Sgt. Pejoro. He was then compelled to affix his signature and fingerprints on the documents presented to him. He denied knowledge of the P20.00 or the dried marijuana leaves, and insisted that the twenty-peso bill came from the pocket of Pejoro. Moreover, the reason why he vomited blood was because of the blows he suffered at the hands of Pejoro. He admitted having escaped from the NARCOM office but claimed that he did so since he could no longer endure the maltreatment to which he was being subjected. After escaping, he proceeded to the house of his uncle, Bienvenido Sunga, at San Matias, Guagua, reaching the

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place at around 6:30 or 7:30 p.m. There, he consulted a quack doctor and, later, he was accompanied by his sister to the Romana Pangan District Hospital at Floridablanca, Pampanga where he was confined for three days. 9

Appellant's brother, Norberto Simon, testified to the fact that appellant was hospitalized at Floridablanca, Pampanga after undergoing abdominal pain and vomiting of blood. He likewise confirmed that appellant had been suffering from peptic ulcer even before the latter's arrest.  10 Also, Dr. Evelyn Gomez-Aguas, a resident physician of Romana Pangan District Hospital, declared that she treated appellant for three days due to abdominal pain, but her examination revealed that the cause for this ailment was appellant's peptic ulcer. She did not see any sign of slight or serious external injury, abrasion or contusion on his body. 11

On December 4, 1989, after weighing the evidence presented, the trial court rendered judgment convicting appellant for a violation of Section 4, Article II of Republic Act No. 6425, as amended, and sentencing him to suffer the penalty of life imprisonment, to pay a fine of twenty thousand pesos and to pay the costs. The four tea bags of marijuana dried leaves were likewise ordered confiscated in favor of the Government. 12

Appellant now prays the Court to reverse the aforementioned judgment of the lower court, contending in his assignment of errors that the latter erred in (1) not upholding his defense of "frame-up", (2) not declaring Exhibit "G" (Receipt of Property Seized/Confiscated) inadmissible in evidence, and (3) convicting him of a violation of the Dangerous Drugs Act. 13

At the outset, it should be noted that while the People's real theory and evidence is to the effect the appellant actually sold only two tea bags of marijuana dried leaves, while the other two tea bags were merely confiscated subsequently from his possession, 14 the latter not being in any way connected with the sale, the information alleges that he sold and delivered four tea bags of marijuana dried leaves. 15 In view thereof, the issue presented for resolution in this appeal is merely the act of selling the two tea bags allegedly committed by appellant, and does not include the disparate and distinct issue of illegal possession of the other two tea bags which separate offense is not charged herein. 16

To sustain a conviction for selling prohibited drugs, the sale must be clearly and unmistakably established. 17 To sell means to give, whether for money or any other material consideration.  18 It must, therefore, be established beyond doubt that appellant actually sold and delivered two tea bags of marijuana dried leaves to Sgt. Lopez, who acted as the poseur-buyer, in exchange for two twenty-peso bills.

After an assiduous review and calibration of the evidence adduced by both parties, we are morally certain that appellant was caught in flagrante delicto engaging in the illegal sale of prohibited drugs. The prosecution was able to prove beyond a scintilla of doubt that appellant, on October 22, 1988, did sell two tea bags of marijuana dried leaves to Sgt. Lopez. The latter himself creditably testified as to how the sale took place and his testimony was amply corroborated by his teammates. As between the straightforward, positive and corroborated testimony of Lopez and the bare denials and negative

testimony of appellant, the former undeniably deserves greater weight and is more entitled to credence.

We are aware that the practice of entrapping drug traffickers through the utilization of poseur-buyers is susceptible to mistake, harassment, extortion and abuse. 19 Nonetheless, such causes for judicial apprehension and doubt do not obtain in the case at bar. Appellant's entrapment and arrest were not effected in a haphazard way, for a surveillance was conducted by the team before the buy-bust operation was effected. 20 No ill motive was or could be attributed to them, aside from the fact that they are presumed to have regularly performed their official duty.  21 Such lack of dubious motive coupled with the presumption of regularity in the performance of official duty, as well as the findings of the trial court on the credibility of witnesses, should prevail over the self-serving and uncorroborated claim of appellant of having been framed, 22 erected as it is upon the mere shifting sands of an alibi. To top it all, appellant was caught red-handed delivering prohibited drugs, and while there was a delimited chance for him to controvert the charge, he does not appear to have plausibly done so.

When the drug seized was submitted to the Crime Laboratory Service of the then Philippine Constabulary-Integrated National Police (PC-INP) at Camp Olivas for examination, P/Cpl. Marlyn Salangad, a forensic chemist therein, 23 confirmed in her Technical Report No. NB-448-88 that the contents of the four tea bags confiscated from appellant were positive for and had a total weight of 3.8 grams of marijuana. 24 Thus, the corpus delicti of the crime had been fully proved with certainty and conclusiveness. 25

Appellant would want to make capital of the alleged inconsistencies and improbabilities in the testimonies of the prosecution witnesses. Foremost, according to him, is the matter of who really confiscated the marijuana tea bags from him since, in open court, Pejoro asserted that he had nothing to do with the confiscation of the marijuana, but in the aforementioned "Receipt of Property Seized/Confiscated," he signed it as the one who seized the same. 26

Suffice it to say that whether it was Villaruz or Pejoro who confiscated the marijuana will not really matter since such is not an element of the offense with which appellant is charged. What is unmistakably clear is that the marijuana was confiscated from the possession of appellant. Even, assuming arguendo that the prosecution committed an error on who actually seized the marijuana from appellant, such an error or discrepancy refers only to a minor matter and, as such, neither impairs the essential integrity of the prosecution evidence as a whole nor reflects on the witnesses' honesty. 27 Besides, there was clearly a mere imprecision of language since Pejoro obviously meant that he did not take part in the physical taking of the drug from the person of appellant, but he participated in the legal seizure or confiscation thereof as the investigator of their unit.

Next, appellant adduces the argument that the twenty-peso bills allegedly confiscated from him were not powdered for finger-printing purposes contrary to the normal procedure in buy-bust operations. 28 This omission has been satisfactorily explained by Pfc. Virgilio Villaruz in his testimony, as follows:

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Q: Is it the standard operating procedure of your unit that in conducting such operation you do not anymore provide a powder (sic) on the object so as to determine the thumbmark or identity of the persons taking hold of the object?

A: We were not able to put powder on these denominations because we are lacking that kind of material in our office since that item can be purchased only in Manila and only few are producing that, sir.

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Q: Is it not a fact that your office is within (the) P.C. Crime Laboratory, CIS, as well as the office of NICA?

A: Our office is only adjacent to those offices but we cannot make a request for that powder because they, themselves, are using that in their own work, sir. 29

The foregoing explanation aside, we agree that the failure to mark the money bills used for entrapment purposes can under no mode of rationalization be fatal to the case of the prosecution because the Dangerous Drugs Act punishes "any person who, unless authorized by law, shall sell, administer, deliver, give away to another, distribute, dispatch in transit or transport any prohibited drug, or shall act as a broker in any of such transactions."30 The dusting of said bills with phosphorescent powder is only an evidentiary technique for identification purposes, which identification can be supplied by other species of evidence.

Again, appellant contends that there was neither a relative of his nor any barangay official or civilian to witness the seizure. He decries the lack of pictures taken before, during and after his arrest. Moreover, he was not reported to or booked in the custody of any barangay official or police authorities. 31 These are absurd disputations. No law or jurisprudence requires that an arrest or seizure, to be valid, be witnessed by a relative, a barangay official or any other civilian, or be accompanied by the taking of pictures. On the contrary, the police enforcers having caught appellant in flagrante delicto, they were not only authorized but were also under the obligation to effect a warrantless arrest and seizure.

Likewise, contrary to appellant's contention, there was an arrest report prepared by the police in connection with his apprehension. Said Booking Sheet and Arrest Report  32 states, inter alia, that "suspect was arrested for selling two tea bags of suspected marijuana dried leaves and the confiscation of another two tea bags of suspected marijuana dried leaves." Below these remarks was affixed appellant's signature. In the same manner, the receipt for the seized property, hereinbefore mentioned, was signed by appellant wherein he acknowledged the confiscation of the marked bills from him. 33

However, we find and hereby declare the aforementioned exhibits inadmissible in evidence. Appellant's conformance to these documents are declarations against interest and tacit admissions of

the crime charged. They were obtained in violation of his right as a person under custodial investigation for the commission of an offense, there being nothing in the records to show that he was assisted by counsel. 34 Although appellant manifested during the custodial investigation that he waived his right to counsel, the waiver was not made in writing and in the presence of counsel,  35 hence whatever incriminatory admission or confession may be extracted from him, either verbally or in writing, is not allowable in evidence. 36 Besides, the arrest report is self-serving and hearsay and can easily be concocted to implicate a suspect.

Notwithstanding the objectionability of the aforesaid exhibits, appellant cannot thereby be extricated from his predicament since his criminal participation in the illegal sale of marijuana has been sufficiently proven. The commission of the offense of illegal sale of prohibited drugs requires merely the consummation of the selling transaction 37 which happens the moment the buyer receives the drug from the seller. 38 In the present case, and in light of the preceding discussion, this sale has been ascertained beyond any peradventure of doubt.

Appellant then asseverates that it is improbable that he would sell marijuana to a total stranger.  39 We take this opportunity to once again reiterate the doctrinal rule that drug-pushing, when done on a small scale as in this case, belongs to that class of crimes that may be committed at any time and in any place. 40 It is not contrary to human experience for a drug pusher to sell to a total stranger,  41 for what matters is not an existing familiarity between the buyer and seller but their agreement and the acts constituting the sale and delivery of the marijuana leaves. 42 While there may be instances where such sale could be improbable, taking into consideration the diverse circumstances of person, time and place, as well as the incredibility of how the accused supposedly acted on that occasion, we can safely say that those exceptional particulars are not present in this case.

Finally, appellant contends that he was subjected to physical and mental torture by the arresting officers which caused him to escape from Camp Olivas the night he was placed under custody. 43 This he asserts to support his explanation as to how his signatures on the documents earlier discussed were supposedly obtained by force and coercion.

The doctrine is now too well embedded in our jurisprudence that for evidence to be believed, it must not only proceed from the mouth of a credible witness but must be credible in itself such as the common experience and observation of mankind can approve as probable under the circumstances. 44 The evidence on record is bereft of any support for appellant's allegation of maltreatment. Two doctors, one for the prosecution 45 and the other for the defense, 46 testified on the absence of any tell-tale sign or indication of bodily injury, abrasions or contusions on the person of appellant. What is evident is that the cause of his abdominal pain was his peptic ulcer from which he had been suffering even before his arrest. 47 His own brother even corroborated that fact, saying that appellant has had a history of bleeding peptic ulcer. 48

Furthermore, if it is true that appellant was maltreated at Camp Olivas, he had no reason whatsoever for not divulging the same to his brother who went to see him at the camp after his arrest and during his detention there.49 Significantly, he also did not even report the matter to the authorities nor file appropriate charges against the alleged malefactors despite the opportunity to do so 50 and with the

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legal services of counsel being available to him. Such omissions funnel down to the conclusion that appellant's story is a pure fabrication.

These, and the events earlier discussed, soundly refute his allegations that his arrest was baseless and premeditated for the NARCOM agents were determined to arrest him at all costs.  51 Premeditated or not, appellant's arrest was only the culmination, the final act needed for his isolation from society and it was providential that it came about after he was caught in the very act of illicit trade of prohibited drugs. Accordingly, this opinion could have concluded on a note of affirmance of the judgment of the trial court. However, Republic Act No. 6425, as amended, was further amended by Republic Act No. 7659 effective December 31, 1993, 52 which supervenience necessarily affects the original disposition of this case and entails additional questions of law which we shall now resolve.

II

The provisions of the aforesaid amendatory law, pertinent to the adjudication of the case at bar, are to this effect:

Sec. 13. Sections 3, 4, 5, 7, 8 and 9 of Art. II of Republic Act No. 6425, as amended, known as the Dangerous Drugs Act of 1972, are hereby amended to read as follows:

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Sec. 4. Sale, Administration, Delivery, Distribution and Transportation of Prohibited Drugs. — The penalty of reclusion perpetua to death and a fine ranging from five hundred thousand pesos to ten million pesos shall be imposed upon any person who, unless authorized by law, shall sell, administer, deliver, give away to another, distribute, dispatch in transit or transport any prohibited drug, or shall act as a broker in any of such transactions.

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Sec. 17. Section 20, Article IV of Republic Act No. 6425, as amended, known as the Dangerous Drugs Act of 1972, is hereby amended to read as follows:

Sec. 20. Application of Penalties, Confiscation and Forfeiture of the Proceeds or Instrument of the Crime. — The penalties for offenses under Sections 3, 4, 7, 8 and 9 of Article II and Sections 14, 14-A, 15 and 16 of Article III of this Act shall be applied if the dangerous drugs involved is in any of the following quantities:

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5. 750 grams or more of indian hemp or marijuana

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Otherwise, if the quantity involved is less than the foregoing quantities, the penalty shall range from prision correccional to reclusion perpetua depending upon the quantity.

1. Considering that herein appellant is being prosecuted for the sale of four tea bags of marijuana with a total weight of only 3.8 grams and, in fact, stands to be convicted for the sale of only two of those tea bags, the initial inquiry would be whether the patently favorable provisions of Republic Act No. 7659 should be given retroactive effect to entitle him to the lesser penalty provided thereunder, pursuant to Article 22 of the Revised Penal Code.

Although Republic Act No. 6425 was enacted as a special law, albeit originally amendatory and in substitution of the previous Articles 190 to 194 of the Revised Penal Code, 53 it has long been settled that by force of Article 10 of said Code the beneficient provisions of Article 22 thereof applies to and shall be given retrospective effect to crimes punished by special laws.  54 The execution in said article would not apply to those convicted of drug offenses since habitual delinquency refers to convictions for the third time or more of the crimes of serious or less serious physical injuries, robo, hurto, estafa or falsification. 55

Since, obviously, the favorable provisions of Republic Act No. 7659 could neither have then been involved nor invoked in the present case, a corollary question would be whether this court, at the present stage, can sua sponte apply the provisions of said Article 22 to reduce the penalty to be imposed on appellant. That issue has likewise been resolved in the cited case of People vs. Moran, et al., ante., thus:

. . . . The plain precept contained in article 22 of the Penal Code, declaring the retroactivity of penal laws in so far as they are favorable to persons accused of a felony, would be useless and nugatory if the courts of justice were not under obligation to fulfill such duty, irrespective of whether or not the accused has applied for it, just as would also all provisions relating to the prescription of the crime and the penalty.

If the judgment which could be affected and modified by the reduced penalties provided in Republic Act No. 7659 has already become final and executory or the accused is serving sentence thereunder, then practice, procedure and pragmatic considerations would warrant and necessitate the matter being brought to the judicial authorities for relief under a writ of habeas corpus. 56

2. Probably through oversight, an error on the matter of imposable penalties appears to have been committed in the drafting of the aforesaid law; thereby calling for and necessitating judicial reconciliation and craftsmanship.

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As applied to the present case, Section 4 of Republic Act No. 6425, as now further amended, imposes the penalty of reclusion perpetua to death and a fine ranging from P500,000.00 to P10,000,000.00 upon any person who shall unlawfully sell, administer, deliver, give away, distribute, dispatch in transit or transport any prohibited drug. That penalty, according to the amendment to Section 20 of the law, shall be applied if what is involved is 750 grams or more of indian hemp or marijuana; otherwise, if the quantity involved is less, the penalty shall range from prision correccional to reclusion perpetua depending upon the quantity.

In other words, there is here an overlapping error in the provisions on the penalty of reclusion perpetua by reason of its dual imposition, that is, as the maximum of the penalty where the marijuana is less than 750 grams, and also as the minimum of the penalty where the marijuana involved is 750 grams or more. The same error has been committed with respect to the other prohibited and regulated drugs provided in said Section 20. To harmonize such conflicting provisions in order to give effect to the whole law, 57 we hereby hold that the penalty to be imposed where the quantity of the drugs involved is less than the quantities stated in the first paragraph shall range from prision correccional to reclusion temporal, and not reclusion perpetua. This is also concordant with the fundamental rule in criminal law that all doubts should be construed in a manner favorable to the accused.

3. Where, as in this case, the quantity of the dangerous drug is only 3.8 grams, hence covered by the imposable range of penalties under the second paragraph of Section 20, as now modified, the law provides that the penalty shall be taken from said range "depending upon the quantity" of the drug involved in the case. The penalty in said second paragraph constitutes a complex one composed of three distinct penalties, that is, prision correccional,prision mayor, and reclusion temporal. In such a situation, the Code provides that each one shall form a period, with the lightest of them being the minimum, the next as the medium, and the most severe as the maximum period.58

Ordinarily, and pursuant to Article 64 of the Code, the mitigating and aggravating circumstances determine which period of such complex penalty shall be imposed on the accused. The peculiarity of the second paragraph of Section 20, however, is its specific mandate, above quoted, that the penalty shall instead depend upon the quantity of the drug subject of the criminal transaction. 59 Accordingly, by way of exception to Article 77 of the Code and to subserve the purpose of Section 20 of Republic Act No. 7659, each of the aforesaid component penalties shall be considered as a principal imposable penalty depending on the quantity of the drug involved. Thereby, the modifying circumstances will not altogether be disregarded. Since each component penalty of the total complex penalty will have to be imposed separately as determined by the quantity of the drug involved, then the modifying circumstances can be used to fix the proper period of that component penalty, as shall hereafter be explained.

It would, therefore, be in line with the provisions of Section 20 in the context of our aforesaid disposition thereon that, unless there are compelling reasons for a deviation, the quantities of the drugs enumerated in its second paragraph be divided into three, with the resulting quotient, and double or treble the same, to be respectively the bases for allocating the penalty proportionately among the three aforesaid periods according to the severity thereof. Thus, if the marijuana involved is below 250 grams, the penalty to be imposed shall be prision correccional; from 250 to 499

grams, prision mayor; and 500 to 749 grams, reclusion temporal. Parenthetically, fine is imposed as a conjunctive penalty only if the penalty is reclusion perpetua to death. 60

Now, considering the minimal quantity of the marijuana subject of the case at bar, the penalty of prision correccional is consequently indicated but, again, another preliminary and cognate issue has first to be resolved.

4. Prision correccional has a duration of 6 months and 1 day to 6 years and, as a divisible penalty, it consists of three periods as provided in the text of and illustrated in the table provided by Article 76 of the Code. The question is whether or not in determining the penalty to be imposed, which is here to be taken from the penalty of prision correccional, the presence or absence of mitigating, aggravating or other circumstances modifying criminal liability should be taken into account.

We are not unaware of cases in the past wherein it was held that, in imposing the penalty for offenses under special laws, the rules on mitigating or aggravating circumstances under the Revised Penal Code cannot and should not be applied. A review of such doctrines as applied in said cases, however, reveals that the reason therefor was because the special laws involved provided their own specific penalties for the offenses punished thereunder, and which penalties were not taken from or with reference to those in the Revised Penal Code. Since the penalties then provided by the special laws concerned did not provide for the minimum, medium or maximum periods, it would consequently be impossible to consider the aforestated modifying circumstances whose main function is to determine the period of the penalty in accordance with the rules in Article 64 of the Code.

This is also the rationale for the holding in previous cases that the provisions of the Code on the graduation of penalties by degrees could not be given supplementary application to special laws, since the penalties in the latter were not components of or contemplated in the scale of penalties provided by Article 71 of the former. The suppletory effect of the Revised Penal Code to special laws, as provided in Article 10 of the former, cannot be invoked where there is a legal or physical impossibility of, or a prohibition in the special law against, such supplementary application.

The situation, however, is different where although the offense is defined in and ostensibly punished under a special law, the penalty therefor is actually taken from the Revised Penal Code in its technical nomenclature and, necessarily, with its duration, correlation and legal effects under the system of penalties native to said Code. When, as in this case, the law involved speaks of  prision correccional, in its technical sense under the Code, it would consequently be both illogical and absurd to posit otherwise. More on this later.

For the nonce, we hold that in the instant case the imposable penalty under Republic Act No. 6425, as amended by Republic Act No. 7659, is prision correccional, to be taken from the medium period thereof pursuant to Article 64 of the Revised Penal Code, there being no attendant mitigating or aggravating circumstance.

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5. At this juncture, a clarificatory discussion of the developmental changes in the penalties imposed for offenses under special laws would be necessary.

Originally, those special laws, just as was the conventional practice in the United States but differently from the penalties provided in our Revised Penal Code and its Spanish origins, provided for one specific penalty or a range of penalties with definitive durations, such as imprisonment for one year or for one to five years but without division into periods or any technical statutory cognomen. This is the special law contemplated in and referred to at the time laws like the Indeterminate Sentence Law 61 were passed during the American regime.

Subsequently, a different pattern emerged whereby a special law would direct that an offense thereunder shall be punished under the Revised Penal Code and in the same manner provided therein. Inceptively, for instance, Commonwealth Act No. 303 62 penalizing non-payment of salaries and wages with the periodicity prescribed therein, provided:

Sec. 4. Failure of the employer to pay his employee or laborer as required by section one of this Act, shallprima facie be considered a fraud committed by such employer against his employee or laborer by means of false pretenses similar to those mentioned in article three hundred and fifteen, paragraph four, sub-paragraph two (a) of the Revised Penal Code and shall be punished in the same manner as therein provided. 63

Thereafter, special laws were enacted where the offenses defined therein were specifically punished by the penalties as technically named and understood in the Revised Penal Code. These are exemplified by Republic Act No. 1700 (Anti-Subversion Act) where the penalties ranged from arresto mayor to death; 64 Presidential Decree No. 1612 (Anti-Fencing Decree) where the penalties run from arresto mayor toprision mayor; and Presidential Decree No. 1866 (illegal possession and other prohibited acts involving firearms), the penalties wherefor may involveprision mayor, reclusion temporal, reclusion perpetua or death.

Another variant worth mentioning is Republic Act No. 6539 (Anti-Carnapping Act of 1972) where the penalty is imprisonment for not less than 14 years and 8 months and not more than 17 years and 4 months, when committed without violence or intimidation of persons or force upon things; not less than 17 years and 4 months and not more than 30 years, when committed with violence against or intimidation of any person, or force upon things; and life imprisonment to death, when the owner, driver or occupant of the carnapped vehicle is killed.

With respect to the first example, where the penalties under the special law are different from and are without reference or relation to those under the Revised Penal Code, there can be no suppletory effect of the rules for the application of penalties under said Code or by other relevant statutory provisions based on or applicable only to said rules for felonies under the Code. In this type of special law, the legislative intendment is clear.

The same exclusionary rule would apply to the last given example, Republic Act No. 6539. While it is true that the penalty of 14 years and 8 months to 17 years and 4 months is virtually equivalent to the duration of the medium period of reclusion temporal, such technical term under the Revised Penal Code is not given to that penalty for carnapping. Besides, the other penalties for carnapping attended by the qualifying circumstances stated in the law do not correspond to those in the Code. The rules on penalties in the Code, therefore, cannot suppletorily apply to Republic Act No. 6539 and special laws of the same formulation.

On the other hand, the rules for the application of penalties and the correlative effects thereof under the Revised Penal Code, as well as other statutory enactments founded upon and applicable to such provisions of the Code, have suppletory effect to the penalties under the former Republic Act No. 1700 and those now provided under Presidential Decrees Nos. 1612 and 1866. While these are special laws, the fact that the penalties for offenses thereunder are those provided for in the Revised Penal code lucidly reveals the statutory intent to give the related provisions on penalties for felonies under the Code the corresponding application to said special laws, in the absence of any express or implicit proscription in these special laws. To hold otherwise would be to sanction an indefensible judicial truncation of an integrated system of penalties under the Code and its allied legislation, which could never have been the intendment of Congress.

In People vs. Macatanda, 65 a prosecution under a special law (Presidential Decree No. 533, otherwise known as the Anti-Cattle Rustling Law of 1974), it was contended by the prosecution that Article 64, paragraph 5, of the Revised Penal Code should not apply to said special law. We said therein that —

We do not agree with the Solicitor General that P.D. 533 is a special law entirely distinct from and unrelated to the Revised Penal Code. From the nature of the penalty imposed which is in terms of the classification and duration of penalties as prescribed in the Revised Penal Code, which is not for penalties as are ordinarily imposed in special laws, the intent seems clear that P.D. 533 shall be deemed as an amendment of the Revised Penal Code, with respect to the offense of theft of large cattle (Art. 310) or otherwise to be subject to applicable provisions thereof such as Article 104 of the Revised Penal Code . . . . Article 64 of the same Code should, likewise, be applicable, . . . . (Emphasis supplied.)

More particularly with regard to the suppletory effect of the rules on penalties in the Revised Penal Code to Republic Act No. 6425, in this case involving Article 63(2) of the Code, we have this more recent pronouncement:

. . . Pointing out that as provided in Article 10 the provisions of the Revised Penal Code shall be "supplementary" to special laws, this Court held that where the special law expressly grants to the court discretion in applying the penalty prescribed for the offense, there is no room for the application of the provisions of the Code . . . .

The Dangerous Drugs Act of 1972, as amended by P.D. No. 1623, contains no explicit grant of discretion to the Court in the application of the penalty prescribed by the

CRIM CASES 7

law. In such case, the court must be guided by the rules prescribed by the Revised Penal Code concerning the application of penalties which distill the "deep legal thought and centuries of experience in the administration of criminal laws." (Emphasis ours.) 66

Under the aforestated considerations, in the case of the Dangerous Drugs Act as now amended by Republic Act No. 7659 by the incorporation and prescription therein of the technical penalties defined in and constituting integral parts of the three scales of penalties in the Code, 67 with much more reason should the provisions of said Code on the appreciation and effects of all attendant modifying circumstances apply in fixing the penalty. Likewise, the different kinds or classifications of penalties and the rules for graduating such penalties by degrees should have supplementary effect on Republic Act No. 6425, except if they would result in absurdities as will now be explained.

While not squarely in issue in this case, but because this aspect is involved in the discussion on the role of modifying circumstances, we have perforce to lay down the caveat that mitigating circumstances should be considered and applied only if they affect the periods and the degrees of the penalties within rational limits.

Prefatorily, what ordinarily are involved in the graduation and consequently determine the degree of the penalty, in accordance with the rules in Article 61 of the Code as applied to the scale of penalties in Article 71, are the stage of execution of the crime and the nature of the participation of the accused. However, under paragraph 5 of Article 64, when there are two or more ordinary mitigating circumstances and no aggravating circumstance, the penalty shall be reduced by one degree. Also, the presence of privileged mitigating circumstances, as provided in Articles 67 and 68, can reduce the penalty by one or two degrees, or even more. These provisions of Articles 64(5), 67 and 68 should not apply in toto in the determination of the proper penalty under the aforestated second paragraph of section 20 of Republic Act No. 6425, to avoid anomalous results which could not have been contemplated by the legislature.

Thus, paragraph 5 of Article 61 provides that when the law prescribes a penalty in some manner not specially provided for in the four preceding paragraphs thereof, the courts shall proceed by analogy therewith. Hence, when the penalty prescribed for the crime consists of one or two penalties to be imposed in their full extent, the penalty next lower in degree shall likewise consist of as many penalties which follow the former in the scale in Article 71. If this rule were to be applied, and since the complex penalty in this case consists of three discrete penalties in their full extent, that is, prision correccional, prision mayor and reclusion temporal, then one degree lower would be arresto menor,destierro and arresto mayor. There could, however, be no further reduction by still one or two degrees, which must each likewise consist of three penalties, since only the penalties of fine and public censure remain in the scale.

The Court rules, therefore, that while modifying circumstances may be appreciated to determine the periods of the corresponding penalties, or even reduce the penalty by degrees, in no case should such graduation of penalties reduce the imposable penalty beyond or lower than prision correccional. It is for this reason that the three component penalties in the second paragraph of Section 20 shall each

be considered as an independent principal penalty, and that the lowest penalty should in any event be prision correccional in order not to depreciate the seriousness of drug offenses. Interpretatio fienda est ut res magis valeat quam pereat. Such interpretation is to be adopted so that the law may continue to have efficacy rather than fail. A perfect judicial solution cannot be forged from an imperfect law, which impasse should now be the concern of and is accordingly addressed to Congress.

6. The final query is whether or not the Indeterminate Sentence Law is applicable to the case now before us. Apparently it does, since drug offenses are not included in nor has appellant committed any act which would put him within the exceptions to said law and the penalty to be imposed does not involve reclusion perpetua or death, provided, of course, that the penalty as ultimately resolved will exceed one year of imprisonment. 68 The more important aspect, however, is how the indeterminate sentence shall be ascertained.

It is true that Section 1 of said law, after providing for indeterminate sentence for an offense under the Revised Penal Code, states that "if the offense is punished by any other law, the court shall sentence the accused to an indeterminate sentence, the maximum term of which shall not exceed the maximum fixed by said law and the minimum shall not be less than the minimum term prescribed by the same." We hold that this quoted portion of the section indubitably refers to an offense under a special law wherein the penalty imposed was not taken from and is without reference to the Revised Penal Code, as discussed in the preceding illustrations, such that it may be said that the "offense is punished" under that law.

There can be no sensible debate that the aforequoted rule on indeterminate sentence for offenses under special laws was necessary because of the nature of the former type of penalties under said laws which were not included or contemplated in the scale of penalties in Article 71 of the Code, hence there could be no minimum "within the range of the penalty next lower to that prescribed by the Code for the offense," as is the rule for felonies therein. In the illustrative examples of penalties in special laws hereinbefore provided, this rule applied, and would still apply, only to the first and last examples. Furthermore, considering the vintage of Act No. 4103 as earlier noted, this holding is but an application and is justified under the rule of contemporanea expositio. 69

We repeat, Republic Act No. 6425, as now amended by Republic Act No. 7659, has unqualifiedly adopted the penalties under the Revised Penal Code in their technical terms, hence with their technical signification and effects. In fact, for purposes of determining the maximum of said sentence, we have applied the provisions of the amended Section 20 of said law to arrive at  prision correccional and Article 64 of the Code to impose the same in the medium period. Such offense, although provided for in a special law, is now in effect punished by and under the Revised Penal Code. Correlatively, to determine the minimum, we must apply the first part of the aforesaid Section 1 which directs that "in imposing a prison sentence for an offense punished by the Revised Penal Code, or its amendments, the court shall sentence the accused to an indeterminate sentence the maximum term of which shall be that which, in view of the attending circumstances, could be properly imposed under the rules of said Code, and the minimum which shall be within the range of the penalty next lower to that prescribed by the Code for the offense." (Emphasis ours.)

CRIM CASES 8

A divergent pedantic application would not only be out of context but also an admission of the hornbook maxim that qui haeret in litera haeret in cortice. Fortunately, this Court has never gone only skin-deep in its construction of Act. No. 4103 by a mere literal appreciation of its provisions. Thus, with regard to the phrase in Section 2 thereof excepting from its coverage "persons convicted of offenses punished with death penalty or life imprisonment," we have held that what is considered is the penalty actually imposed and not the penalty imposable under the law,  70 and that reclusion perpetua is likewise embraced therein although what the law states is "life imprisonment".

What irresistibly emerges from the preceding disquisition, therefore, is that under the concurrence of the principles of literal interpretation, which have been rationalized by comparative decisions of this Court; of historical interpretation, as explicated by the antecedents of the law and related contemporaneous legislation; and of structural interpretation, considering the interrelation of the penalties in the Code as supplemented by Act No. 4103 in an integrated scheme of penalties, it follows that the minimum of the indeterminate sentence in this case shall be the penalty next lower to that prescribed for the offense. Thereby we shall have interpreted the seeming ambiguity in Section 1 of Act No. 4103 in such a way as to harmonize laws with laws, which is the best mode of interpretation. 71

The indeterminate Sentence Law is a legal and social measure of compassion, and should be liberally interpreted in favor of the accused. 72 The "minimum" sentence is merely a period at which, and not before, as a matter of grace and not of right, the prisoner may merely be allowed to serve the balance of his sentence outside of his confinement. 73 It does not constitute the totality of the penalty since thereafter he still has to continue serving the rest of his sentence under set conditions. That minimum is only the period when the convict's eligibility for parole may be considered. In fact, his release on parole may readily be denied if he is found unworthy thereof, or his reincarceration may be ordered on legal grounds, even if he has served the minimum sentence.

It is thus both amusing and bemusing if, in the case at bar, appellant should be begrudged the benefit of a minimum sentence within the range of arresto mayor, the penalty next lower to prision correccional which is the maximum range we have fixed through the application of Articles 61 and 71 of the Revised Penal Code. For, with fealty to the law, the court may set the minimum sentence at 6 months of arresto mayor, instead of 6 months and 1 day of prision correccional. The difference, which could thereby even involve only one day, is hardly worth the creation of an overrated tempest in the judicial teapot.

ACCORDINGLY, under all the foregoing premises, the judgment of conviction rendered by the court a quo against accused-appellant Martin Simon y Sunga is AFFIRMED, but with the MODIFICATION that he should be, as he hereby is, sentenced to serve an indeterminate penalty of six (6) months of arresto mayor, as the minimum, to six (6) years of prision correccional, as the maximum thereof.

SO ORDERED.

Narvasa, C.J., Cruz, Padilla, Bidin, Romero, Melo, Puno, Vitug, Kapunan and Mendoza, JJ., concur.

Bellosillo, J., is on leave.

Separate Opinions

DAVIDE, JR., J., concurring and dissenting:

I am still unable to agree with the view that (a) in appropriate cases where the penalty to be imposed would beprision correccional pursuant to the second paragraph of Section 20 of R.A. No. 6425, as amended by Section 17 of R.A. No. 7659, the sentence to be meted out, applying the Indeterminate Sentence Law (Act No. 4103, as amended), should be that whose minimum is within the range of the penalty next lower, i.e., arresto mayor; and (b) the presence of two or more mitigating circumstances not offset by any mitigating circumstances or of a privileged mitigating circumstance shall not reduce the penalty by one or two degrees if the penalty to be imposed, taking into account the quantity of the dangerous drugs involved, would be prision correccional.

I

The first view is based on the proposition that since R.A. No. 7659 had unqualifiedly adopted the penalties under the Revised Penal Code in their technical terms, hence also their technical signification and effects, then what should govern is the first part of Section 1 of the Indeterminate Sentence Law which directs that:

in imposing a prison sentence for an offense punished by the Revised Penal Code, or its amendments, the court shall sentence the accused to an indeterminate sentence the maximum term of which shall be that which, in view of the attending circumstances, could be properly imposed under the rules of the said Code, and the minimum which shall be within the range of the penalty next lower to that prescribed by the Code for the offense.

Elsewise stated, by the adoption of the penalties provided for in the Revised Penal Code for the offenses penalized under the Dangerous Drugs Act (R.A. No. 6425), as amended, the latter offenses would now be considered as punished under the Revised Penal Code for purposes of the Indeterminate Sentence Law.

Section 1 of the Indeterminate Sentence Law (Act. No. 4103, as amended by Act. No. 4225 and R.A. No. 4203) also provides that:

CRIM CASES 9

if the offense is punished by any other law, the court shall sentence the accused to an indeterminate sentence, the maximum term of which shall not exceed the maximum fixed by said law and the minimum shall not be less than the minimum prescribed by the same (Emphasis supplied).

There are, therefore, two categories of offenses which should be taken into account in the application of the Indeterminate Sentence Law: (1) offenses punished by the Revised Penal Code, and (2) offenses punished by other laws (or special laws).

The offenses punished by the Revised Penal Code are those defined and penalized in Book II thereof, which is thus appropriately titled CRIMES AND PENALTIES. To simplify further, a crime is deemed punished under the Revised Penal Code if it is defined by it, and none other, as a crime and is punished by a penalty which is included in the classification of Penalties in Chapter II, Title III of Book I thereof.

On the other hand, an offense is considered punished under any other law (or special law) if it is not defined and penalized by the Revised Penal Code but by such other law.

It is thus clear that an offense is punished by the Revised Penal Code if both its definition and the penalty therefor are found in the said Code, and it is deemed punished by a special law if its definition and the penalty therefor are found in the special law. That the latter imports or borrows from the Revised Penal Code its nomenclature of penalties does not make an offense in the special law punished by or punishable under the Revised Penal Code. The reason is quite simple. It is still the special law that defines the offense and imposes a penalty therefor, although it adopts the Code's nomenclature of penalties. In short, the mere use by a special law of a penalty found in the Revised Penal Code can by no means make an offense thereunder an offense "punished or punishable" by the Revised Penal Code.

Thus, I cannot subscribe to the view that since R.A. No. 7659 had adopted the penalties prescribed by the Revised Penal Code in drug cases, offenses related to drugs should now be considered as  punished under the Revised Penal Code. If that were so, then we are also bound, ineluctably, to declare that such offenses are mala in se and to apply the Articles of the Revised Penal Code regarding the stages of a felony (Article 6), the nature of participation (Article 16), accessory penalties (Articles 40-45), application of penalties to principals, accomplices, and accessories (Article 46 et seq.), complex crimes (Article 48), and graduation of penalties (Article 61), among others. We cannot do otherwise without being drawn to an inconsistent posture which is extremely hard to justify.

I respectfully submit then that the adoption by the Dangerous Drugs Act of the penalties in the Revised Penal Code does not make an offense under the Dangerous Drugs Act an offense punished by the Revised Penal Code. Consequently, where the proper penalty to be imposed under Section 20 of the Dangerous Drugs Act is prisioncorreccional, then, applying the Indeterminate Sentence Law, the indeterminate sentence to be meted on the accused should be that whose minimum should not be less than the minimum prescribed by the special law (the Dangerous Drugs Act), i.e., not lower than six (6) months and one (1) day of prision correccional.

II

The majority opinion holds the view that while the penalty provided for in Section 20 of the Dangerous Drugs Act is a complex one composed of three distinct penalties, viz., prision correccional, prision mayor, and reclusion temporal, and that pursuant to Article 77 of the Revised Penal Code, each should form a period, with the lightest of them being the minimum, the next as the medium, and the most severe as the maximum, yet, considering that under the said second paragraph of Section 20 the penalty depends on the quantity of the drug subject of the criminal transaction, then by way of exception to Article 77 of the Revised Penal Code and to subserve the purpose of Section 20, as amended, each of the aforesaid component penalties shall be considered as a principal penalty depending on the quantity of the drug involved. Thereafter, applying the modifying circumstances pursuant to Article 64 of the Revised Penal Code, the proper period of the component penalty shall then be fixed.

To illustrate, if the quantity of the drugs involved (e.g., marijuana below 250 grams) the proper principal penalty should be prision correccional, but there is one mitigating and no aggravating circumstance, then the penalty to be imposed should be prision correccional in its minimum period. Yet, the majority opinion puts a limit to such a rule. It declares:

The Court rules, therefore, that while modifying circumstances may be appreciated to determine the periods of the corresponding penalties, or even reduce the penalty by degrees, in no case should such graduation of penalties reduce the imposable penalty beyond or lower than prision correccional. It is for this reason that the three component penalties in the second paragraph of Section 20 shall each be considered as an independent principal penalty, and that the lowest penalty should in any event be prision correccional in order to depreciate the seriousness of drug offenses.

Simply put, this rule would allow the reduction from reclusion temporal — if it is the penalty to be imposed on the basis of the quantity of the drugs involved — by two degrees, or to prision correccional, if there are two or more mitigating circumstances and no aggravating circumstance is present (paragraph 5, Article 64, Revised Penal Code) or if there is a privileged mitigating circumstances of, say, minority (Article 68, Revised Penal Code), or under circumstances covered by Article 69 of the Revised Penal Code. Yet, if the proper penalty to be imposed is prision mayor, regardless of the fact that a reduction by two degrees is proper, it should only be reduced by one degree because the rule does not allow a reduction beyondprision correccional. Finally, if the proper penalty to be imposed is prision correccional, no reduction at all would be allowed.

I find the justification for the rule to be arbitrary and unfair. It is arbitrary because within the same second paragraph involving the same range of penalty, we both allow and disallow the application of Article 64(5), Article 68, and Article 69 of the Revised Penal Code. The reason for the disallowance, viz., in order not to depreciate the seriousness of drug offenses, is unconvincing because Section 20 of the Dangerous Drugs Act, as amended by R.A. No. 7659, has in fact "depreciated" the seriousness of drug offenses by providing quantity as basis for the determination of the proper penalty and limiting fine only to cases punishable by reclusion

CRIM CASES 10

perpetua to death. It is unfair because an accused who is found guilty of possessing MORE dangerous drugs — say 500 to 749 grams of marijuana, in which case the penalty to be imposed would be reclusion temporal— may only be sentenced to six (6) months and one (1) day of  prision correccional minimum because of privileged mitigating circumstances. Yet, an accused who is found guilty of possession of only one (1) gram of marijuana — in which case the penalty to be imposed is prision correccional — would not be entitled to a reduction thereof even if he has the same number of privileged mitigating circumstances as the former has.

Also, if the privileged mitigating circumstance happens to be the minority of the accused, then he is entitled to the reduction of the penalty as a matter of right pursuant to Article 68 of the Revised Penal Code, which reads:

Art. 68. Penalty to be imposed upon a person under eighteen years of age. — When the offender is a minor under eighteen years and his case is one coming under the provisions of the paragraph next to the last of Article 80 of this Code, the following rules shall be observed:

1. Upon a person under fifteen but over nine years of age, who is not exempted from liability by reason of the court having declared that he acted with discernment, a discretionary penalty shall be imposed, but always lower by two degrees at least than that prescribed by law for the crime which he committed.

2. Upon a person over fifteen and under eighteen years of age the penalty next lover than that prescribed by law shall be imposed, but always in the proper period.

I do not think that as to the second paragraph of Section 20 of the Dangerous Drugs Act, as amended by Section 17 of R.A. No. 7659, we can be at liberty to apply the Revised Penal Code in one aspect and not to apply it in another.

Feliciano and Quiason, JJ., concur.

# Separate Opinions

DAVIDE, JR., J., concurring and dissenting:

I am still unable to agree with the view that (a) in appropriate cases where the penalty to be imposed would beprision correccional pursuant to the second paragraph of Section 20 of R.A. No. 6425, as amended by Section 17 of R.A. No. 7659, the sentence to be meted out, applying the Indeterminate Sentence Law (Act No. 4103, as amended), should be that whose minimum is within the range of the

penalty next lower, i.e., arresto mayor; and (b) the presence of two or more mitigating circumstances not offset by any mitigating circumstances or of a privileged mitigating circumstance shall not reduce the penalty by one or two degrees if the penalty to be imposed, taking into account the quantity of the dangerous drugs involved, would be prision correccional.

I

The first view is based on the proposition that since R.A. No. 7659 had unqualifiedly adopted the penalties under the Revised Penal Code in their technical terms, hence also their technical signification and effects, then what should govern is the first part of Section 1 of the Indeterminate Sentence Law which directs that:

in imposing a prison sentence for an offense punished by the Revised Penal Code, or its amendments, the court shall sentence the accused to an indeterminate sentence the maximum term of which shall be that which, in view of the attending circumstances, could be properly imposed under the rules of the said Code, and the minimum which shall be within the range of the penalty next lower to that prescribed by the Code for the offense.

Elsewise stated, by the adoption of the penalties provided for in the Revised Penal Code for the offenses penalized under the Dangerous Drugs Act (R.A. No. 6425), as amended, the latter offenses would now be considered as punished under the Revised Penal Code for purposes of the Indeterminate Sentence Law.

Section 1 of the Indeterminate Sentence Law (Act. No. 4103, as amended by Act. No. 4225 and R.A. No. 4203) also provides that:

if the offense is punished by any other law, the court shall sentence the accused to an indeterminate sentence, the maximum term of which shall not exceed the maximum fixed by said law and the minimum shall not be less than the minimum prescribed by the same (Emphasis supplied).

There are, therefore, two categories of offenses which should be taken into account in the application of the Indeterminate Sentence Law: (1) offenses punished by the Revised Penal Code, and (2) offenses punished by other laws (or special laws).

The offenses punished by the Revised Penal Code are those defined and penalized in Book II thereof, which is thus appropriately titled CRIMES AND PENALTIES. To simplify further, a crime is deemed punished under the Revised Penal Code if it is defined by it, and none other, as a crime and is punished by a penalty which is included in the classification of Penalties in Chapter II, Title III of Book I thereof.

CRIM CASES 11

On the other hand, an offense is considered punished under any other law (or special law) if it is not defined and penalized by the Revised Penal Code but by such other law.

It is thus clear that an offense is punished by the Revised Penal Code if both its definition and the penalty therefor are found in the said Code, and it is deemed punished by a special law if its definition and the penalty therefor are found in the special law. That the latter imports or borrows from the Revised Penal Code its nomenclature of penalties does not make an offense in the special law punished by or punishable under the Revised Penal Code. The reason is quite simple. It is still the special law that defines the offense and imposes a penalty therefor, although it adopts the Code's nomenclature of penalties. In short, the mere use by a special law of a penalty found in the Revised Penal Code can by no means make an offense thereunder an offense "punished or punishable" by the Revised Penal Code.

Thus, I cannot subscribe to the view that since R.A. No. 7659 had adopted the penalties prescribed by the Revised Penal Code in drug cases, offenses related to drugs should now be considered as  punished under the Revised Penal Code. If that were so, then we are also bound, ineluctably, to declare that such offenses are mala in se and to apply the Articles of the Revised Penal Code regarding the stages of a felony (Article 6), the nature of participation (Article 16), accessory penalties (Articles 40-45), application of penalties to principals, accomplices, and accessories (Article 46 et seq.), complex crimes (Article 48), and graduation of penalties (Article 61), among others. We cannot do otherwise without being drawn to an inconsistent posture which is extremely hard to justify.

I respectfully submit then that the adoption by the Dangerous Drugs Act of the penalties in the Revised Penal Code does not make an offense under the Dangerous Drugs Act an offense punished by the Revised Penal Code. Consequently, where the proper penalty to be imposed under Section 20 of the Dangerous Drugs Act is prisioncorreccional, then, applying the Indeterminate Sentence Law, the indeterminate sentence to be meted on the accused should be that whose minimum should not be less than the minimum prescribed by the special law (the Dangerous Drugs Act), i.e., not lower than six (6) months and one (1) day of prision correccional.

II

The majority opinion holds the view that while the penalty provided for in Section 20 of the Dangerous Drugs Act is a complex one composed of three distinct penalties, viz., prision correccional, prision mayor, and reclusion temporal, and that pursuant to Article 77 of the Revised Penal Code, each should form a period, with the lightest of them being the minimum, the next as the medium, and the most severe as the maximum, yet, considering that under the said second paragraph of Section 20 the penalty depends on the quantity of the drug subject of the criminal transaction, then by way of exception to Article 77 of the Revised Penal Code and to subserve the purpose of Section 20, as amended, each of the aforesaid component penalties shall be considered as a principal penalty depending on the quantity of the drug involved. Thereafter, applying the modifying circumstances pursuant to Article 64 of the Revised Penal Code, the proper period of the component penalty shall then be fixed.

To illustrate, if the quantity of the drugs involved (e.g., marijuana below 250 grams) the proper principal penalty should be prision correccional, but there is one mitigating and no aggravating circumstance, then the penalty to be imposed should be prision correccional in its minimum period. Yet, the majority opinion puts a limit to such a rule. It declares:

The Court rules, therefore, that while modifying circumstances may be appreciated to determine the periods of the corresponding penalties, or even reduce the penalty by degrees, in no case should such graduation of penalties reduce the imposable penalty beyond or lower than prision correccional. It is for this reason that the three component penalties in the second paragraph of Section 20 shall each be considered as an independent principal penalty, and that the lowest penalty should in any event be prision correccional in order to depreciate the seriousness of drug offenses.

Simply put, this rule would allow the reduction from reclusion temporal — if it is the penalty to be imposed on the basis of the quantity of the drugs involved — by two degrees, or to prision correccional, if there are two or more mitigating circumstances and no aggravating circumstance is present (paragraph 5, Article 64, Revised Penal Code) or if there is a privileged mitigating circumstances of, say, minority (Article 68, Revised Penal Code), or under circumstances covered by Article 69 of the Revised Penal Code. Yet, if the proper penalty to be imposed is prision mayor, regardless of the fact that a reduction by two degrees is proper, it should only be reduced by one degree because the rule does not allow a reduction beyondprision correccional. Finally, if the proper penalty to be imposed is prision correccional, no reduction at all would be allowed.

I find the justification for the rule to be arbitrary and unfair. It is arbitrary because within the same second paragraph involving the same range of penalty, we both allow and disallow the application of Article 64(5), Article 68, and Article 69 of the Revised Penal Code. The reason for the disallowance, viz., in order not to depreciate the seriousness of drug offenses, is unconvincing because Section 20 of the Dangerous Drugs Act, as amended by R.A. No. 7659, has in fact "depreciated" the seriousness of drug offenses by providing quantity as basis for the determination of the proper penalty and limiting fine only to cases punishable by reclusion perpetua to death. It is unfair because an accused who is found guilty of possessing MORE dangerous drugs — say 500 to 749 grams of marijuana, in which case the penalty to be imposed would be reclusion temporal— may only be sentenced to six (6) months and one (1) day of  prision correccional minimum because of privileged mitigating circumstances. Yet, an accused who is found guilty of possession of only one (1) gram of marijuana — in which case the penalty to be imposed is prision correccional — would not be entitled to a reduction thereof even if he has the same number of privileged mitigating circumstances as the former has.

Also, if the privileged mitigating circumstance happens to be the minority of the accused, then he is entitled to the reduction of the penalty as a matter of right pursuant to Article 68 of the Revised Penal Code, which reads:

Art. 68. Penalty to be imposed upon a person under eighteen years of age. — When the offender is a minor under eighteen years and his case is one coming under the

CRIM CASES 12

provisions of the paragraph next to the last of Article 80 of this Code, the following rules shall be observed:

1. Upon a person under fifteen but over nine years of age, who is not exempted from liability by reason of the court having declared that he acted with discernment, a discretionary penalty shall be imposed, but always lower by two degrees at least than that prescribed by law for the crime which he committed.

2. Upon a person over fifteen and under eighteen years of age the penalty next lover than that prescribed by law shall be imposed, but always in the proper period.

I do not think that as to the second paragraph of Section 20 of the Dangerous Drugs Act, as amended by Section 17 of R.A. No. 7659, we can be at liberty to apply the Revised Penal Code in one aspect and not to apply it in another.

Feliciano and Quiason, JJ., concur.

CRIM CASES 13

JOSE ALEMANIA BUATIS, JR., Petitioner, vs.THE PEOPLE OF THE PHILIPPINES and ATTY. JOSE J. PIERAZ, Respondents.D E C I S I O NAUSTRIA-MARTINEZ, J.:Before us is a petition for review on certiorari filed by Jose Alemania Buatis, Jr. (petitioner) seeking to set aside the Decision1 dated January 18, 2000 of the Court of Appeals (CA) in CA-G.R. CR. No. 20988 which affirmed the decision of the Regional Trial Court (RTC), Branch 167 of Pasig City, convicting him of the crime of libel. Also assailed is the appellate court’s Resolution2 dated March 13, 2000 denying petitioner’s Motion for Reconsideration.The facts of the case, as summarized by the appellate court, are as follows:On August 18, 1995, the wife of private-complainant Atty. Jose J. Pieraz (Atty. Pieraz), retrieved a letter from their mailbox addressed to her husband. The letter was open, not contained in an envelope, and Atty. Pieraz’ wife put it on her husband’s desk. On that same day, Atty. Pieraz came upon the letter and made out its content. It reads:DON HERMOGENES RODRIGUEZ Y REYES ESTATEOffice of the Asst. Court Administrator No. 1063 Kamias St., Bgy. Manggahan, Pasig City,Metro ManilaAugust 18, 1995ATTY. JOSE J. PIERAZCounsel for Benjamin A. Monroy#8 Quirino St., Life Homes SubdivisionRosario , Pasig City, Metro ManilaSubject: Anent your letter dated August 18, 1995 addressed to one Mrs. Teresita QuingcoAtty. Pieraz:This has reference to your lousy but inutile threatening letter dated August 18, 1995, addressed to our client; using carabao English.May we remind you that any attempt on your part to continue harassing the person of Mrs. Teresita Quingco of No. 1582 Mngo St., Bgy. Manggahan, Pasig City, Metro Manila---undersigned much to his regrets shall be constrained/compelled to file the necessary complaint for disbarment against you.You may proceed then with your stupidity and suffer the full consequence of the law. Needless for you to cite specific provisions of the Revised Penal Code, as the same is irrelevant to the present case. As a matter of fact, the same shall be used by no other than the person of Mrs. Quingco in filing administrative charge against you and all persons behind these nefarious activities.Finally, it is a welcome opportunity for the undersigned to face you squarely in any courts of justice, so as we can prove "who is who" once and for all.Trusting that you are properly inform (sic) regarding these matters, I remain.Yours in Satan name;(Signed)JOSE ALEMANIA BUATIS, JR.Atty-in- Fact of the presentCourt Administrator of the entireIntestate Estate of Don HermogenesRodriguez Y. Reyes.

Copy furnished:All concerned.Not personally knowing who the sender was, Atty. Pieraz, nevertheless, responded and sent a communication by registered mail to said Buatis, Jr., accused-appellant. In reply, Buatis, Jr. dispatched a second letter dated August 24, 1995 to Atty. Pieraz.Reacting to the insulting words used by Buatis, Jr., particularly: "Satan, senile, stupid, [E]nglish carabao," Atty. Pieraz filed a complaint for libel against accused-appellant. Subject letter and its contents came to the knowledge not only of his wife but of his children as well and they all chided him telling him: "Ginagawa ka lang gago dito."Aside from the monetary expenses he incurred as a result of the filing of the instant case, Atty Pieraz’ frail health was likewise affected and aggravated by the letter of accused-appellant.The defense forwarded by accused-appellant Buatis, Jr. was denial. According to him, it was at the behest of the president of the organization "Nagkakaisang Samahan Ng Mga Taga Manggahan" or NASATAMA, and of a member, Teresita Quingco, that he had dictated to one of his secretaries, a comment to the letter of private-complainant in the second week of August 1995.Initially during his testimony, Buatis, Jr. could not recall whether he had signed that letter-comment or if it was even addressed to Atty. Pieraz. Neither could he remember if he had made and sent another letter, this time dated August 24, 1995, to Atty. Pieraz. Confronted in court with the counter-affidavit which he filed before the Pasig City Prosecutor’s Office, however, Buatis, Jr. could not deny its contents, among which was his admission that indeed, he had sent subject letter of August 18 and the letter dated August 24, 1995 to Atty. Pieraz.3

After trial on the merits, the RTC rendered its Decision dated April 30, 19974 finding petitioner guilty of the crime of libel, the dispositive portion of which reads:WHEREFORE, judgment is hereby rendered finding the accused Jose Alemania Buatis, Jr. GUILTY of the crime of LIBEL defined in Art. 353 and penalized under Art. 355 of the Revised Penal Code and is hereby sentenced to an indeterminate penalty of imprisonment of Four (4) Months and One (1) Day, as minimum, to Two (2) Years, Eleven (11) Months and Ten (10) Days, as maximum; to indemnify the offended party in the amount of P20,000.00, by way of compensatory damages; the amount of P10,000.00, as and for moral damages, and another amount ofP10,000.00, for exemplary damages; to suffer all accessory penalties provided for by law; and, to pay the costs. 5

The trial court ruled that: calling a lawyer "inutil", stupid and capable of using only carabao English, is intended not only for the consumption of respondent but similarly for others as a copy of the libelous letter was furnished all concerned; the letter was prejudicial to the good name of respondent and an affront to his standing as a lawyer, who, at the time the letter was addressed to him, was representing a client in whose favor he sent a demand letter to the person represented by petitioner; the letter is libelous per se since a defect or vice imputed is plainly understood as set against the entire message sought to be conveyed; petitioner failed to reverse the presumption of malice from the defamatory imputation contained in the letter; the letter could have been couched in a civil and respectful manner, as the intention of petitioner was only to advice respondent that demand was not proper and legal but instead petitioner was seething with hate and contempt and even influenced by satanic intention.The RTC also found that since the letter was made known or brought to the attention and notice of other persons other than the offended party, there was publication; and that the element of identity was also established since the letter was intended for respondent. It rejected petitioner’s stance that the libelous letter resulted from mistake or negligence since petitioner boldly admitted that he had to reply to respondent’s letter to Mrs. Quingco, it being his duty to do as the latter is a member of petitioner’s association.

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The RTC found respondent entitled to recover compensatory damages as the immediate tendency of the defamatory imputation was to impair respondent’s reputation although no actual pecuniary loss has in fact resulted. It also awarded moral damages as well as exemplary damages since the publication of the libelous letter was made with special ill will, bad faith or in a reckless disregard for the rights of respondent.Subsequently, petitioner appealed the RTC’s decision to the CA which, in a Decision dated January 18, 2000, affirmed in its entirety the decision of the trial court.The CA found that the words used in the letter are uncalled for and defamatory in character as they impeached the good reputation of respondent as a lawyer and that it is malicious. It rejected petitioner’s claim that the letter is a privileged communication which would exculpate him from liability since he failed to come up with a valid explanation as to why he had to resort to name calling and downgrading a lawyer to the extent of ridiculing him when he could have discharged his so called "duty" in a more toned down fashion. It found also that there was publication of the letter, thus, it cannot be classified as privileged.The CA denied petitioner’s motion for reconsideration in a Resolution dated March 13, 2000.Hence the instant petition for review on certiorari filed by petitioner, raising the following issues:A. CAN THERE BE MALICE IN FACT, AS ONE OF THE ELEMENTS OF LIBEL, ATTRIBUTED TO A RESPONDING URBAN POOR LEADER ACTING AS COUNSEL, DEFENDING A MEMBER OF AN ASSOCIATION UNDER THREAT OF EJECTMENT FROM HER DWELLING PLACE?B. WHETHER OR NOT THE APPELLATE COURT ERRED IN NOT FINDING THE ALLEGED LIBELOUS LETTER AS ONE OF THOSE FALLING UNDER THE PURVIEW OF PRIVILEGE (sic) COMMUNICATION?C. WHETHER OR NOT THE APPELLATE COURT ERRED IN NOT FINDING THAT: THE PETITIONER CAN NOT BE MADE TO ACCEPT FULL RESPONSIBILITY THAT WHAT HE DID IS A CRIME?6

The Office of the Solicitor General filed its Comment in behalf of the People and respondent filed his own Comment praying for the affirmance of the CA decision. As required by us, the parties submitted their respective memoranda.The principal issue for resolution is whether or not petitioner is guilty of the crime of libel.In his Memorandum, petitioner claims that: the CA failed to apply the ruling in People v. Velasco7 that "if the act/matter charged as libelous is only an incident in [an] act which has another objective, the crime is not libel;" when he made his reply to respondent’s letter to Mrs. Quingco making a demand for her to vacate the premises, his objective was to inform respondent that Mrs. Quingco is one of the recognized tenants of the Rodriguez estate which is claiming ownership over the area of Brgy. Manggahan, Pasig City, and petitioner is the attorney-in-fact of the administrator of the Rodriquez estate; communication in whatever language, either verbal or written of a lawyer under obligation to defend a client’s cause is but a privileged communication; the instant case is a qualified privileged communication which is lost only by proof of malice, however, respondent failed to present actual proof of malice; the existence of malice in fact may be shown by extrinsic evidence that petitioner bore a grudge against the offended party, or there was ill will or ill feeling between them which existed at the time of the publication of the defamatory imputation which were not at all indicated by respondent in his complaint; contrary to the findings of the CA, there was justifiable motive in sending such a letter which was to defend the vested interest of the estate and to abate any move of respondent to eject Mrs. Quingco.Petitioner further argues that if the words used in the libelous letter-reply would be fully scrutinized, there is justification for the use of those words, to wit: "lousy but inutile threatening letter…using carabao English" was due to the fact that the demand letter was indeed a threatening letter as it does not serve its purpose as respondent’s client has no legal right over the property and respondent did not file the ejectment suit; that respondent is just making a mockery out of Mrs. Quingco, thus he is

stupid; that the words "Yours in Satan name" is only a complementary greeting used in an ordinary communication letter, which is reflected to the sender but not to the person being communicated and which is just the reverse of saying "Yours in Christ".We deny the petition.Article 353 of the Revised Penal Code defines libel as a public and malicious imputation of a crime, or of a vice or defect, real or imaginary, or any act, omission, condition, status, or circumstance tending to cause the dishonor, discredit, or contempt of a natural or juridical person, or to blacken the memory of one who is dead.For an imputation to be libelous, the following requisites must concur: (a) it must be defamatory; (b) it must be malicious; (c) it must be given publicity; and (d) the victim must be identifiable.8

The last two elements have been duly established by the prosecution. There is publication in this case. In libel, publication means making the defamatory matter, after it is written, known to someone other than the person against whom it has been written.9 Petitioner’s subject letter-reply itself states that the same was copy furnished to all concerned. Also, petitioner had dictated the letter to his secretary. It is enough that the author of the libel complained of has communicated it to a third person.10 Furthermore, the letter, when found in the mailbox, was open, not contained in an envelope thus, open to public.The victim of the libelous letter was identifiable as the subject letter-reply was addressed to respondent himself.We shall then resolve the issues raised by petitioner as to whether the imputation is defamatory and malicious.In determining whether a statement is defamatory, the words used are to be construed in their entirety and should be taken in their plain, natural and ordinary meaning as they would naturally be understood by persons reading them, unless it appears that they were used and understood in another sense.11

For the purpose of determining the meaning of any publication alleged to be libelous, we laid down the rule inJimenez v. Reyes,12 to wit:In Tawney vs. Simonson, Whitcomb & Hurley Co. (109 Minn., 341), the court had the following to say on this point: "In determining whether the specified matter is libelous per se, two rules of construction are conspicuously applicable: (1) That construction must be adopted which will give to the matter such a meaning as is natural and obvious in the plain and ordinary sense in which the public would naturally understand what was uttered. (2) The published matter alleged to be libelous must be construed as a whole."In applying these rules to the language of an alleged libel, the court will disregard any subtle or ingenious explanation offered by the publisher on being called to account. The whole question being the effect the publication had upon the minds of the readers, and they not having been assisted by the offered explanation in reading the article, it comes too late to have the effect of removing the sting, if any there be, from the words used in the publication.13

Gauging from the above–mentioned tests, the words used in the letter dated August 18, 1995 sent by petitioner to respondent is defamatory. In using words such as "lousy", "inutile", "carabao English", "stupidity", and "satan", the letter, as it was written, casts aspersion on the character, integrity and reputation of respondent as a lawyer which exposed him to ridicule. No evidence aliunde need be adduced to prove it. As the CA said, these very words of petitioner have caused respondent to public ridicule as even his own family have told him: "Ginagawa ka lang gago dito."14

Any of the imputations covered by Article 353 is defamatory; and, under the general rule laid down in Article 354, every defamatory imputation is presumed to be malicious, even if it be true, if no good

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intention and justifiable motive for making it is shown. Thus, when the imputation is defamatory, the prosecution need not prove malice on the part of petitioner (malice in fact), for the law already presumes that petitioner’s imputation is malicious (malice in law).15 A reading of petitioner’s subject letter-reply showed that he malevolently castigated respondent for writing such a demand letter to Mrs. Quingco. There was nothing in the said letter which showed petitioner’s good intention and justifiable motive for writing the same in order to overcome the legal inference of malice.Petitioner, however, insists that his letter was a private communication made in the performance of his moral and social duty as the attorney-in-fact of the administrator of the Rodriguez estate where Mrs. Quingco is a recognized tenant and to whom respondent had written the demand letter to vacate, thus in the nature of a privileged communication and not libelous.We are not persuaded.Article 354 of the Revised Penal Code provides:Art. 354. Requirement for publicity.─ Every defamatory imputation is presumed to be malicious, even if it be true, if no good intention and justifiable motive for making it is shown, except in the following cases:1. A private communication made by any person to another in the performance of any legal, moral, or social duty; and2. A fair and true report, made in good faith, without any comments or remarks, of any judicial, legislative, or other official proceedings which are not of confidential nature, or of any statement, report, or speech delivered in said proceedings, or of any other act performed by public officers in the exercise of their functions.Clearly, the presumption of malice is done away with when the defamatory imputation is a qualified privileged communication.In order to prove that a statement falls within the purview of a qualified privileged communication under Article 354, No. 1, as claimed by petitioner, the following requisites must concur: (1) the person who made the communication had a legal, moral, or social duty to make the communication, or at least, had an interest to protect, which interest may either be his own or of the one to whom it is made; (2) the communication is addressed to an officer or a board, or superior, having some interest or duty in the matter, and who has the power to furnish the protection sought; and (3) the statements in the communication are made in good faith and without malice.16

While it would appear that the letter was written by petitioner out of his social duty to a member of the association which he heads, and was written to respondent as a reply to the latter’s demand letter sent to a member, however, a reading of the subject letter-reply addressed to respondent does not show any explanation concerning the status of Mrs. Quingco and why she is entitled to the premises as against the claim of respondent’s client. The letter merely contained insulting words, i.e, "lousy" and "inutile letter using carabao English", "stupidity", and "satan", which are totally irrelevant to his defense of Mrs. Quingco’s right over the premises. The words as written had only the effect of maligning respondent’s integrity as a lawyer, a lawyer who had served as legal officer in the Department of Environment and Natural Resources for so many years until his retirement and afterwards as consultant of the same agency and also a notary public. The letter was crafted in an injurious way than what is necessary in answering a demand letter which exposed respondent to public ridicule thus negating good faith and showing malicious intent on petitioner’s part.Moreover, the law requires that for a defamatory imputation made out of a legal, moral or social duty to be privileged, such statement must be communicated only to the person or persons who have some interest or duty in the matter alleged, and who have the power to furnish the protection sought by the author of the statement.17 A written letter containing libelous matter cannot be classified as privileged

when it is published and circulated among the public.18 In this case, petitioner admitted that he dictated the letter to one of her secretaries who typed the same and made a print out of the computer.19 While petitioner addressed the reply-letter to respondent, the same letter showed that it was copy furnished to all concerned. His lack of selectivity is indicative of malice and is anathema to his claim of privileged communication.20 Such publication had already created upon the minds of the readers a circumstance which brought discredit and shame to respondent’s reputation.Since the letter is not a privileged communication, malice is presumed under Article 354 of the Revised Penal Code. The presumption was not successfully rebutted by petitioner as discussed above.Thus, we find that the CA did not commit any error in affirming the findings of the trial court that petitioner is guilty of the crime of libel.An appeal in a criminal case throws the entire case for review and it becomes our duty to correct any error, as may be found in the appealed judgment, whether assigned as an error or not.21 We find that the award of P20,000.00 as compensatory damages should be deleted for lack of factual basis. To be entitled to actual and compensatory damages, there must be competent proof constituting evidence of the actual amount thereof.22 Respondent had not presented evidence in support thereof.Article 355 of the Revised Penal Code penalizes libel by means of writings or similar means with prision correccional in its minimum and medium periods or a fine ranging from 200 to 6,000 pesos, or both, in addition to the civil action which may be brought by the offended party.The courts are given the discretion to choose whether to impose a single penalty or conjunctive penalties; that is, whether to impose a penalty of fine, or a penalty of imprisonment only, or a penalty of both fine and imprisonment.In Vaca v. Court of Appeals,23 where petitioners therein were convicted of B.P. 22 which provides for alternative penalties of fine or imprisonment or both fine and imprisonment, we deleted the prison sentence imposed upon petitioners and instead ordered them only to pay a fine equivalent to double the amount of the check. We held:Petitioners are first-time offenders. They are Filipino entrepreneurs who presumably contribute to the national economy. Apparently, they brought this appeal, believing in all good faith, although mistakenly, that they had not committed a violation of B.P. Blg. 22. Otherwise, they could simply have accepted the judgment of the trial court and applied for probation to evade prison term. It would best serve the ends of criminal justice if in fixing the penalty within the range of discretion allowed by §1, par. 1, the same philosophy underlying the Indeterminate Sentence Law is observed, namely, that of redeeming valuable human material and preventing unnecessary deprivation of personal liberty and economic usefulness with due regard to the protection of the social order.24

In the subsequent case of Lim v. People,25 we did the same and deleted the penalty of imprisonment and merely imposed a fine for violation of B.P. 22, concluding that such would best serve the ends of criminal justice.Adopting these cases, we issued Administrative Circular No. 12-2000. On February 14, 2001, we issued Administrative Circular 13-2001 which modified Administrative Circular No. 12-2000 by stressing that the clear tenor of Administrative Circular No. 12-2000 is not to remove imprisonment as an alternative penalty, but to lay down a rule of preference in the application of the penalties provided for in B.P. 22.While Vaca case is for violation of B.P. 22, we find the reasons behind the imposition of fine instead of imprisonment applicable to petitioner’s case of libel. We note that this is petitioner’s first offense of this nature. He never knew respondent prior to the demand letter sent by the latter to Mrs. Quingco who then sought his assistance thereto. He appealed from the decision of the RTC and the CA in his belief that he was merely exercising a civil or moral duty in writing the letter to private complainant. In fact, petitioner could have applied for probation to evade prison term but he did not do so believing

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that he did not commit a crime thus, he appealed his case. We believe that the State is concerned not only in the imperative necessity of protecting the social organization against the criminal acts of destructive individuals but also in redeeming the individual for economic usefulness and other social ends.26 Consequently, we delete the prison sentence imposed on petitioner and instead impose a fine of six thousand pesos.This is not the first time that we removed the penalty of imprisonment and imposed a fine instead in the crime of libel. In Sazon v. Court of Appeals,27 petitioner was convicted of libel and was meted a penalty of imprisonment and fine; and upon a petition filed with us, we affirmed the findings of libel but changed the penalty imposed to a mere fine.WHEREFORE, the decision of the Court of Appeals is hereby AFFIRMED with the MODIFICATIONS that, in lieu of imprisonment, the penalty to be imposed upon the petitioner shall be a fine of Six Thousand (P6,000.00) Pesos with subsidiary imprisonment in case of insolvency. The award of compensatory damages is DELETED.SO ORDERED.MA. ALICIA AUSTRIA-MARTINEZ Associate JusticeWE CONCUR:

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G.R. No. 135808             October 6, 2008SECURITIES AND EXCHANGE COMMISSION, petitioner, vs.INTERPORT RESOURCES CORPORATION, MANUEL S. RECTO, RENE S. VILLARICA, PELAGIO RICALDE, ANTONIO REINA, FRANCISCO ANONUEVO, JOSEPH SY and SANTIAGO TANCHAN, JR., respondents.D E C I S I O NCHICO-NAZARIO, J.:This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing the Decision,1 dated 20 August 1998, rendered by the Court of Appeals in C.A.-G.R. SP No. 37036, enjoining petitioner Securities and Exchange Commission (SEC) from taking cognizance of or initiating any action against the respondent corporation Interport Resources Corporation (IRC) and members of its board of directors, respondents Manuel S. Recto, Rene S. Villarica, Pelagio Ricalde, Antonio Reina, Francisco Anonuevo, Joseph Sy and Santiago Tanchan, Jr., with respect to Sections 8, 30 and 36 of the Revised Securities Act. In the same Decision of the appellate court, all the proceedings taken against the respondents, including the assailed SEC Omnibus Orders of 25 January 1995 and 30 March 1995, were declared void.The antecedent facts of the present case are as follows.On 6 August 1994, the Board of Directors of IRC approved a Memorandum of Agreement with Ganda Holdings Berhad (GHB). Under the Memorandum of Agreement, IRC acquired 100% or the entire capital stock of Ganda Energy Holdings, Inc. (GEHI),2 which would own and operate a 102 megawatt (MW) gas turbine power-generating barge. The agreement also stipulates that GEHI would assume a five-year power purchase contract with National Power Corporation. At that time, GEHI's power-generating barge was 97% complete and would go on-line by mid-September of 1994. In exchange, IRC will issue to GHB 55% of the expanded capital stock of IRC amounting to 40.88 billion shares which had a total par value of P488.44 million.3

On the side, IRC would acquire 67% of the entire capital stock of Philippine Racing Club, Inc. (PRCI). PRCI owns 25.724 hectares of real estate property in Makati. Under the Agreement, GHB, a member of the Westmont Group of Companies in Malaysia, shall extend or arrange a loan required to pay for the proposed acquisition by IRC of PRCI.4

IRC alleged that on 8 August 1994, a press release announcing the approval of the agreement was sent through facsimile transmission to the Philippine Stock Exchange and the SEC, but that the facsimile machine of the SEC could not receive it. Upon the advice of the SEC, the IRC sent the press release on the morning of 9 August 1994.5

The SEC averred that it received reports that IRC failed to make timely public disclosures of its negotiations with GHB and that some of its directors, respondents herein, heavily traded IRC shares utilizing this material insider information. On 16 August 1994, the SEC Chairman issued a directive requiring IRC to submit to the SEC a copy of its aforesaid Memorandum of Agreement with GHB. The SEC Chairman further directed all principal officers of IRC to appear at a hearing before the Brokers and Exchanges Department (BED) of the SEC to explain IRC's failure to immediately disclose the information as required by the Rules on Disclosure of Material Facts.6

In compliance with the SEC Chairman's directive, the IRC sent a letter dated 16 August 1994 to the SEC, attaching thereto copies of the Memorandum of Agreement. Its directors, Manuel Recto, Rene Villarica and Pelagio Ricalde, also appeared before the SEC on 22 August 1994 to explain IRC's alleged failure to immediately disclose material information as required under the Rules on Disclosure of Material Facts.7

On 19 September 1994, the SEC Chairman issued an Order finding that IRC violated the Rules on Disclosure of Material Facts, in connection with the Old Securities Act of 1936, when it failed to make timely disclosure of its negotiations with GHB. In addition, the SEC pronounced that some of the officers and directors of IRC entered into transactions involving IRC shares in violation of Section 30, in relation to Section 36, of the Revised Securities Act.8

Respondents filed an Omnibus Motion, dated 21 September 1994, which was superseded by an Amended Omnibus Motion, filed on 18 October 1994, alleging that the SEC had no authority to investigate the subject matter, since under Section 8 of Presidential Decree No. 902-A,9 as amended by Presidential Decree No. 1758, jurisdiction was conferred upon the Prosecution and Enforcement Department (PED) of the SEC. Respondents also claimed that the SEC violated their right to due process when it ordered that the respondents appear before the SEC and "show cause why no administrative, civil or criminal sanctions should be imposed on them," and, thus, shifted the burden of proof to the respondents. Lastly, they sought to have their cases tried jointly given the identical factual situations surrounding the alleged violation committed by the respondents.10

Respondents also filed a Motion for Continuance of Proceedings on 24 October 1994, wherein they moved for discontinuance of the investigations and the proceedings before the SEC until the undue publicity had abated and the investigating officials had become reasonably free from prejudice and public pressure.11

No formal hearings were conducted in connection with the aforementioned motions, but on 25 January 1995, the SEC issued an Omnibus Order which thus disposed of the same in this wise:12

WHEREFORE, premised on the foregoing considerations, the Commission resolves and hereby rules:1. To create a special investigating panel to hear and decide the instant case in accordance with the Rules of Practice and Procedure Before the Prosecution and Enforcement Department (PED), Securities and Exchange Commission, to be composed of Attys. James K. Abugan, Medardo Devera (Prosecution and Enforcement Department), and Jose Aquino (Brokers and Exchanges Department), which is hereby directed to expeditiously resolve the case by conducting continuous hearings, if possible.2. To recall the show cause orders dated September 19, 1994 requiring the respondents to appear and show cause why no administrative, civil or criminal sanctions should be imposed on them.3. To deny the Motion for Continuance for lack of merit.Respondents filed an Omnibus Motion for Partial Reconsideration,13 questioning the creation of the special investigating panel to hear the case and the denial of the Motion for Continuance. The SEC denied reconsideration in its Omnibus Order dated 30 March 1995.14

The respondents filed a petition before the Court of Appeals docketed as C.A.-G.R. SP No. 37036, questioning the Omnibus Orders dated 25 January 1995 and 30 March 1995.15 During the proceedings before the Court of Appeals, respondents filed a Supplemental Motion16 dated 16 May 1995, wherein they prayed for the issuance of a writ of preliminary injunction enjoining the SEC and its agents from investigating and proceeding with the hearing of the case against respondents herein. On 5 May 1995, the Court of Appeals granted their motion and issued a writ of preliminary injunction, which effectively enjoined the SEC from filing any criminal, civil or administrative case against the respondents herein.17

On 23 October 1995, the SEC filed a Motion for Leave to Quash SEC Omnibus Orders so that the case may be investigated by the PED in accordance with the SEC Rules and Presidential Decree No. 902-A, and not by the special body whose creation the SEC had earlier ordered.18

The Court of Appeals promulgated a Decision19 on 20 August 1998. It determined that there were no implementing rules and regulations regarding disclosure, insider trading, or any of the provisions of the Revised Securities Acts which the respondents allegedly violated. The Court of Appeals likewise noted that it found no statutory authority for the SEC to initiate and file any suit for civil liability under

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Sections 8, 30 and 36 of the Revised Securities Act. Thus, it ruled that no civil, criminal or administrative proceedings may possibly be held against the respondents without violating their rights to due process and equal protection. It further resolved that absent any implementing rules, the SEC cannot be allowed to quash the assailed Omnibus Orders for the sole purpose of re-filing the same case against the respondents.20

The Court of Appeals further decided that the Rules of Practice and Procedure Before the PED, which took effect on 14 April 1990, did not comply with the statutory requirements contained in the Administrative Code of 1997. Section 8, Rule V of the Rules of Practice and Procedure Before the PED affords a party the right to be present but without the right to cross-examine witnesses presented against him, in violation of Section 12(3), Chapter 3, Book VII of the Administrative Code. 21

In the dispositive portion of its Decision, dated 20 August 1998, the Court of Appeals ruled that22:WHEREFORE, [herein petitioner SEC's] Motion for Leave to Quash SEC Omnibus Orders is herebyDENIED. The petition for certiorari, prohibition and mandamus is GRANTED. Consequently, all proceedings taken against [herein respondents] in this case, including the Omnibus Orders of January 25, 1995 and March 30, 1995 are declared null and void. The writ of preliminary injunction is hereby made permanent and, accordingly, [SEC] is hereby prohibited from taking cognizance or initiating any action, be they civil, criminal, or administrative against [respondents] with respect to Sections 8 (Procedure for Registration), 30 (Insider's duty to disclose when trading) and 36 (Directors, Officers and Principal Stockholders) in relation to Sections 46 (Administrative sanctions) 56 (Penalties) 44 (Liabilities of Controlling persons) and 45 (Investigations, injunctions and prosecution of offenses) of the Revised Securities Act and Section 144 (Violations of the Code) of the Corporation Code. (Emphasis provided.)The SEC filed a Motion for Reconsideration, which the Court of Appeals denied in a Resolution23 issued on 30 September 1998.Hence, the present petition, which relies on the following grounds24:ITHE COURT OF APPEALS ERRED WHEN IT DENIED PETITIONER'S MOTION FOR LEAVE TO QUASH THE ASSAILED SEC OMNIBUS ORDERS DATED JANUARY 25 AND MARCH 30, 1995.IITHE COURT OF APPEALS ERRED WHEN IT RULED THAT THERE IS NO STATUTORY AUTHORITY WHATSOEVER FOR PETITIONER SEC TO INITIATE AND FILE ANY SUIT BE THEY CIVIL, CRIMINAL OR ADMINISTRATIVE AGAINST RESPONDENT CORPORATION AND ITS DIRECTORS WITH RESPECT TO SECTION 30 (INSIDER'S DUTY TO DISCOLSED [sic] WHEN TRADING) AND 36 (DIRECTORS OFFICERS AND PRINCIPAL STOCKHOLDERS) OF THE REVISED SECURITIES ACT; ANDIIITHE COURT OF APPEALS ERRED WHEN IT RULED THAT RULES OF PRACTICE AND PROSECUTION BEFORE THE PED AND THE SICD RULES OF PROCEDURE ON ADMINISTRATIVE ACTIONS/PROCEEDINGS25 ARE INVALID AS THEY FAIL TO COMPLY WITH THE STATUTORY REQUIREMENTS CONTAINED IN THE ADMINISTRATIVE CODE OF 1987.The petition is impressed with merit.Before discussing the merits of this case, it should be noted that while this case was pending in this Court, Republic Act No. 8799, otherwise known as the Securities Regulation Code, took effect on 8 August 2000. Section 8 of Presidential Decree No. 902-A, as amended, which created the PED, was already repealed as provided for in Section 76 of the Securities Regulation Code:SEC. 76. Repealing Clause. - The Revised Securities Act (Batas Pambansa Blg. 178), as amended, in its entirety, and Sections 2, 4 and 8 of Presidential Decree 902-A, as amended, are hereby repealed. All

other laws, orders, rules and regulations, or parts thereof, inconsistent with any provision of this Code are hereby repealed or modified accordingly.Thus, under the new law, the PED has been abolished, and the Securities Regulation Code has taken the place of the Revised Securities Act.The Court now proceeds with a discussion of the present case.I. Sctions 8, 30 and 36 of the Revised Securities Act do not require the enactment of implementing rules to make them binding and effective.The Court of Appeals ruled that absent any implementing rules for Sections 8, 30 and 36 of the Revised Securities Act, no civil, criminal or administrative actions can possibly be had against the respondents without violating their right to due process and equal protection, citing as its basis the case Yick Wo v. Hopkins.26 This is untenable.In the absence of any constitutional or statutory infirmity, which may concern Sections 30 and 36 of the Revised Securities Act, this Court upholds these provisions as legal and binding. It is well settled that every law has in its favor the presumption of validity. Unless and until a specific provision of the law is declared invalid and unconstitutional, the same is valid and binding for all intents and purposes.27 The mere absence of implementing rules cannot effectively invalidate provisions of law, where a reasonable construction that will support the law may be given. In People v. Rosenthal,28 this Court ruled that:In this connection we cannot pretermit reference to the rule that "legislation should not be held invalid on the ground of uncertainty if susceptible of any reasonable construction that will support and give it effect. An Act will not be declared inoperative and ineffectual on the ground that it furnishes no adequate means to secure the purpose for which it is passed, if men of common sense and reason can devise and provide the means, and all the instrumentalities necessary for its execution are within the reach of those intrusted therewith." (25 R.C.L., pp. 810, 811)In Garcia v. Executive Secretary,29 the Court underlined the importance of the presumption of validity of laws and the careful consideration with which the judiciary strikes down as invalid acts of the legislature:The policy of the courts is to avoid ruling on constitutional questions and to presume that the acts of the political departments are valid in the absence of a clear and unmistakable showing to the contrary. To doubt is to sustain. This presumption is based on the doctrine of separation of powers which enjoins upon each department a becoming respect for the acts of the other departments. The theory is that as the joint act of Congress and the President of the Philippines, a law has been carefully studied and determined to be in accordance with the fundamental law before it was finally enacted.The necessity for vesting administrative authorities with power to make rules and regulations is based on the impracticability of lawmakers' providing general regulations for various and varying details of management.30 To rule that the absence of implementing rules can render ineffective an act of Congress, such as the Revised Securities Act, would empower the administrative bodies to defeat the legislative will by delaying the implementing rules. To assert that a law is less than a law, because it is made to depend on a future event or act, is to rob the Legislature of the power to act wisely for the public welfare whenever a law is passed relating to a state of affairs not yet developed, or to things future and impossible to fully know.31 It is well established that administrative authorities have the power to promulgate rules and regulations to implement a given statute and to effectuate its policies, provided such rules and regulations conform to the terms and standards prescribed by the statute as well as purport to carry into effect its general policies. Nevertheless, it is undisputable that the rules and regulations cannot assert for themselves a more extensive prerogative or deviate from the mandate of the statute.32Moreover, where the statute contains sufficient standards and an

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unmistakable intent, as in the case of Sections 30 and 36 of the Revised Securities Act, there should be no impediment to its implementation.The reliance placed by the Court of Appeals in Yick Wo v. Hopkins33 shows a glaring error. In the cited case, this Court found unconstitutional an ordinance which gave the board of supervisors authority to refuse permission to carry on laundries located in buildings that were not made of brick and stone, because it violated the equal protection clause and was highly discriminatory and hostile to Chinese residents and not because the standards provided therein were vague or ambiguous.This Court does not discern any vagueness or ambiguity in Sections 30 and 36 of the Revised Securities Act, such that the acts proscribed and/or required would not be understood by a person of ordinary intelligence.Section 30 of the Revised Securities ActSection 30 of the Revised Securities Act reads:Sec. 30. Insider's duty to disclose when trading. - (a) It shall be unlawful for an insider to sell or buy a security of the issuer, if he knows a fact of special significance with respect to the issuer or the security that is not generally available, unless (1) the insider proves that the fact is generally available or (2) if the other party to the transaction (or his agent) is identified, (a) the insider proves that the other party knows it, or (b) that other party in fact knows it from the insider or otherwise.(b) "Insider" means (1) the issuer, (2) a director or officer of, or a person controlling, controlled by, or under common control with, the issuer, (3) a person whose relationship or former relationship to the issuer gives or gave him access to a fact of special significance about the issuer or the security that is not generally available, or (4) a person who learns such a fact from any of the foregoing insiders as defined in this subsection, with knowledge that the person from whom he learns the fact is such an insider.(c) A fact is "of special significance" if (a) in addition to being material it would be likely, on being made generally available, to affect the market price of a security to a significant extent, or (b) a reasonable person would consider it especially important under the circumstances in determining his course of action in the light of such factors as the degree of its specificity, the extent of its difference from information generally available previously, and its nature and reliability.(d) This section shall apply to an insider as defined in subsection (b) (3) hereof only to the extent that he knows of a fact of special significance by virtue of his being an insider.The provision explains in simple terms that the insider's misuse of nonpublic and undisclosed information is the gravamen of illegal conduct. The intent of the law is the protection of investors against fraud, committed when an insider, using secret information, takes advantage of an uninformed investor. Insiders are obligated to disclose material information to the other party or abstain from trading the shares of his corporation. This duty to disclose or abstain is based on two factors: first, the existence of a relationship giving access, directly or indirectly, to information intended to be available only for a corporate purpose and not for the personal benefit of anyone; and second, the inherent unfairness involved when a party takes advantage of such information knowing it is unavailable to those with whom he is dealing.34

In the United States (U.S.), the obligation to disclose or abstain has been traditionally imposed on corporate "insiders," particularly officers, directors, or controlling stockholders, but that definition has since been expanded.35 The term "insiders" now includes persons whose relationship or former relationship to the issuer gives or gave them access to a fact of special significance about the issuer or the security that is not generally available, and one who learns such a fact from an insider knowing that the person from whom he learns the fact is such an insider. Insiders have the duty to disclose material facts which are known to them by virtue of their position but which are not known to persons with

whom they deal and which, if known, would affect their investment judgment. In some cases, however, there may be valid corporate reasons for the nondisclosure of material information. Where such reasons exist, an issuer's decision not to make any public disclosures is not ordinarily considered as a violation of insider trading. At the same time, the undisclosed information should not be improperly used for non-corporate purposes, particularly to disadvantage other persons with whom an insider might transact, and therefore the insider must abstain from entering into transactions involving such securities.36

Respondents further aver that under Section 30 of the Revised Securities Act, the SEC still needed to define the following terms: "material fact," "reasonable person," "nature and reliability" and "generally available." 37 In determining whether or not these terms are vague, these terms must be evaluated in the context of Section 30 of the Revised Securties Act. To fully understand how the terms were used in the aforementioned provision, a discussion of what the law recognizes as a fact of special significance is required, since the duty to disclose such fact or to abstain from any transaction is imposed on the insider only in connection with a fact of special significance.Under the law, what is required to be disclosed is a fact of "special significance" which may be (a) a material fact which would be likely, on being made generally available, to affect the market price of a security to a significant extent, or (b) one which a reasonable person would consider especially important in determining his course of action with regard to the shares of stock.(a) Material Fact - The concept of a "material fact" is not a new one. As early as 1973, the Rules Requiring Disclosure of Material Facts by Corporations Whose Securities Are Listed In Any Stock Exchange or Registered/Licensed Under the Securities Act, issued by the SEC on 29 January 1973, explained that "[a] fact is material if it induces or tends to induce or otherwise affect the sale or purchase of its securities." Thus, Section 30 of the Revised Securities Act provides that if a fact affects the sale or purchase of securities, as well as its price, then the insider would be required to disclose such information to the other party to the transaction involving the securities. This is the first definition given to a "fact of special significance."(b.1) Reasonable Person - The second definition given to a fact of special significance involves the judgment of a "reasonable person." Contrary to the allegations of the respondents, a "reasonable person" is not a problematic legal concept that needs to be clarified for the purpose of giving effect to a statute; rather, it is the standard on which most of our legal doctrines stand. The doctrine on negligence uses the discretion of the "reasonable man" as the standard.38 A purchaser in good faith must also take into account facts which put a "reasonable man" on his guard.39 In addition, it is the belief of the reasonable and prudent man that an offense was committed that sets the criteria for probable cause for a warrant of arrest.40 This Court, in such cases, differentiated the reasonable and prudent man from "a person with training in the law such as a prosecutor or a judge," and identified him as "the average man on the street," who weighs facts and circumstances without resorting to the calibrations of our technical rules of evidence of which his knowledge is nil. Rather, he relies on the calculus of common sense of which all reasonable men have in abundance.41 In the same vein, the U.S. Supreme Court similarly determined its standards by the actual significance in the deliberations of a "reasonable investor," when it ruled in TSC Industries, Inc. v. Northway, Inc.,42 that the determination of materiality "requires delicate assessments of the inferences a ‘reasonable shareholder' would draw from a given set of facts and the significance of those inferences to him."(b.2) Nature and Reliability - The factors affecting the second definition of a "fact of special significance," which is of such importance that it is expected to affect the judgment of a reasonable man, were substantially lifted from a test of materiality pronounced in the case In the Matter of Investors Management Co., Inc.43:

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Among the factors to be considered in determining whether information is material under this test are the degree of its specificity, the extent to which it differs from information previously publicly disseminated, and its reliability in light of its nature and source and the circumstances under which it was received.It can be deduced from the foregoing that the "nature and reliability" of a significant fact in determining the course of action a reasonable person takes regarding securities must be clearly viewed in connection with the particular circumstances of a case. To enumerate all circumstances that would render the "nature and reliability" of a fact to be of special significance is close to impossible. Nevertheless, the proper adjudicative body would undoubtedly be able to determine if facts of a certain "nature and reliability" can influence a reasonable person's decision to retain, sell or buy securities, and thereafter explain and justify its factual findings in its decision.(c) Materiality Concept - A discussion of the "materiality concept" would be relevant to both a material fact which would affect the market price of a security to a significant extent and/or a fact which a reasonable person would consider in determining his or her cause of action with regard to the shares of stock. Significantly, what is referred to in our laws as a fact of special significance is referred to in the U.S. as the "materiality concept" and the latter is similarly not provided with a precise definition. In Basic v. Levinson,44 the U.S. Supreme Court cautioned against confining materiality to a rigid formula, stating thus:A bright-line rule indeed is easier to follow than a standard that requires the exercise of judgment in the light of all the circumstances. But ease of application alone is not an excuse for ignoring the purposes of the Securities Act and Congress' policy decisions. Any approach that designates a single fact or occurrence as always determinative of an inherently fact-specific finding such as materiality, must necessarily be overinclusive or underinclusive.Moreover, materiality "will depend at any given time upon a balancing of both the indicated probability that the event will occur and the anticipated magnitude of the event in light of the totality of the company activity."45 In drafting the Securities Act of 1934, the U.S. Congress put emphasis on the limitations to the definition of materiality:Although the Committee believes that ideally it would be desirable to have absolute certainty in the application of the materiality concept, it is its view that such a goal is illusory and unrealistic.  The materiality concept is judgmental in nature and it is not possible to translate this into a numerical formula. The Committee's advice to the [SEC] is to avoid this quest for certainty and to continue consideration of materiality on a case-by-case basis as disclosure problems are identified."House Committee on Interstate and Foreign Commerce, Report of the Advisory Committee on Corporate Disclosure to the Securities and Exchange Commission, 95th Cong., 1st Sess., 327 (Comm.Print 1977). (Emphasis provided.)46

(d) Generally Available - Section 30 of the Revised Securities Act allows the insider the defense that in a transaction of securities, where the insider is in possession of facts of special significance, such information is "generally available" to the public. Whether information found in a newspaper, a specialized magazine, or any cyberspace media be sufficient for the term "generally available" is a matter which may be adjudged given the particular circumstances of the case. The standards cannot remain at a standstill. A medium, which is widely used today was, at some previous point in time, inaccessible to most. Furthermore, it would be difficult to approximate how the rules may be applied to the instant case, where investigation has not even been started. Respondents failed to allege that the negotiations of their agreement with GHB were made known to the public through any form of media for there to be a proper appreciation of the issue presented.Section 36(a) of the Revised Securities Act

As regards Section 36(a) of the Revised Securities Act, respondents claim that the term "beneficial ownership" is vague and that it requires implementing rules to give effect to the law. Section 36(a) of the Revised Securities Act is a straightforward provision that imposes upon (1) a beneficial owner of more than ten percent of any class of any equity security or (2) a director or any officer of the issuer of such security, the obligation to submit a statement indicating his or her ownership of the issuer's securities and such changes in his or her ownership thereof. The said provision reads:Sec. 36. Directors, officers and principal stockholders. - (a) Every person who is directly or indirectly the beneficial owner of more than ten per centum of any [class] of any equity security which is registered pursuant to this Act, or who is [a] director or an officer of the issuer of such security, shall file, at the time of the registration of such security on a securities exchange or by the effective date of a registration statement or within ten days after he becomes such a beneficial owner, director or officer, a statement with the Commission and, if such security is registered on a securities exchange, also with the exchange, of the amount of all equity securities of such issuer of which he is the beneficial owner, and within ten days after the close of each calendar month thereafter, if there has been a change in such ownership during such month, shall file with the Commission, and if such security is registered on a securities exchange, shall also file with the exchange, a statement indicating his ownership at the close of the calendar month and such changes in his ownership as have occurred during such calendar month. (Emphasis provided.)Section 36(a) refers to the "beneficial owner." Beneficial owner has been defined in the following manner:[F]irst, to indicate the interest of a beneficiary in trust property (also called "equitable ownership"); and second, to refer to the power of a corporate shareholder to buy or sell the shares, though the shareholder is not registered in the corporation's books as the owner. Usually, beneficial ownership is distinguished from naked ownership, which is the enjoyment of all the benefits and privileges of ownership, as against possession of the bare title to property.47

Even assuming that the term "beneficial ownership" was vague, it would not affect respondents' case, where the respondents are directors and/or officers of the corporation, who are specifically required to comply with the reportorial requirements under Section 36(a) of the Revised Securities Act. The validity of a statute may be contested only by one who will sustain a direct injury as a result of its enforcement.48

Sections 30 and 36 of the Revised Securities Act were enacted to promote full disclosure in the securities market and prevent unscrupulous individuals, who by their positions obtain non-public information, from taking advantage of an uninformed public. No individual would invest in a market which can be manipulated by a limited number of corporate insiders. Such reaction would stifle, if not stunt, the growth of the securities market. To avert the occurrence of such an event, Section 30 of the Revised Securities Act prevented the unfair use of non-public information in securities transactions, while Section 36 allowed the SEC to monitor the transactions entered into by corporate officers and directors as regards the securities of their companies.In the case In the Matter of Investor's Management Co.,49 it was cautioned that "the broad language of the anti-fraud provisions," which include the provisions on insider trading, should not be "circumscribed by fine distinctions and rigid classifications." The ambit of anti-fraud provisions is necessarily broad so as to embrace the infinite variety of deceptive conduct.50

In Tatad v. Secretary of Department of Energy,51 this Court brushed aside a contention, similar to that made by the respondents in this case, that certain words or phrases used in a statute do not set determinate standards, declaring that:

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Petitioners contend that the words "as far as practicable," "declining" and "stable" should have been defined in R.A. No. 8180 as they do not set determinate and determinable standards. This stubborn submission deserves scant consideration. The dictionary meanings of these words are well settled and cannot confuse men of reasonable intelligence. x x x. The fear of petitioners that these words will result in the exercise of executive discretion that will run riot is thus groundless. To be sure, the Court has sustained the validity of similar, if not more general standards in other cases.Among the words or phrases that this Court upheld as valid standards were "simplicity and dignity,"52 "public interest,"53 and "interests of law and order."54

The Revised Securities Act was approved on 23 February 1982. The fact that the Full Disclosure Rules were promulgated by the SEC only on 24 July 1996 does not render ineffective in the meantime Section 36 of the Revised Securities Act. It is already unequivocal that the Revised Securities Act requires full disclosure and the Full Disclosure Rules were issued to make the enforcement of the law more consistent, efficient and effective. It is equally reasonable to state that the disclosure forms later provided by the SEC, do not, in any way imply that no compliance was required before the forms were provided. The effectivity of a statute which imposes reportorial requirements cannot be suspended by the issuance of specified forms, especially where compliance therewith may be made even without such forms. The forms merely made more efficient the processing of requirements already identified by the statute.For the same reason, the Court of Appeals made an evident mistake when it ruled that no civil, criminal or administrative actions can possibly be had against the respondents in connection with Sections 8, 30 and 36 of the Revised Securities Act due to the absence of implementing rules. These provisions are sufficiently clear and complete by themselves. Their requirements are specifically set out, and the acts which are enjoined are determinable. In particular, Section 855 of the Revised Securities Act is a straightforward enumeration of the procedure for the registration of securities and the particular matters which need to be reported in the registration statement thereof. The Decision, dated 20 August 1998, provides no valid reason to exempt the respondent IRC from such requirements. The lack of implementing rules cannot suspend the effectivity of these provisions. Thus, this Court cannot find any cogent reason to prevent the SEC from exercising its authority to investigate respondents for violation of Section 8 of the Revised Securities Act.II. The right to cross-examination is not absolute and cannot be demanded during investigative proceedings before the PED.In its assailed Decision dated 20 August 1998, the Court of Appeals pronounced that the PED Rules of Practice and Procedure was invalid since Section 8, Rule V56 thereof failed to provide for the parties' right to cross-examination, in violation of the Administrative Code of 1987 particularly Section 12(3), Chapter 3, Book VII thereof. This ruling is incorrect.Firstly, Section 4, Rule I of the PED Rules of Practice and Procedure, categorically stated that the proceedings before the PED are summary in nature:Section 4. Nature of Proceedings - Subject to the requirements of due process, proceedings before the "PED" shall be summary in nature not necessarily adhering to or following the technical rules of evidence obtaining in the courts of law. The Rules of Court may apply in said proceedings in suppletory character whenever practicable.Rule V of the PED Rules of Practice and Procedure further specified that:Section 5. Submission of Documents - During the preliminary conference/hearing, or immediately thereafter, the Hearing Officer may require the parties to simultaneously submit their respective verified position papers accompanied by all supporting documents and the affidavits of their witnesses, if any which shall take the place of their direct testimony. The parties shall furnish each

other with copies of the position papers together with the supporting affidavits and documents submitted by them.Section 6. Determination of necessity of hearing. - Immediately after the submission by the parties of their position papers and supporting documents, the Hearing Officer shall determine whether there is a need for a formal hearing. At this stage, he may, in his discretion, and for the purpose of making such determination, elicit pertinent facts or information, including documentary evidence, if any, from any party or witness to complete, as far as possible, the facts of the case. Facts or information so elicited may serve as basis for his clarification or simplifications of the issues in the case. Admissions and stipulation of facts to abbreviate the proceedings shall be encouraged.Section 7. Disposition of Case. If the Hearing Officer finds no necessity of further hearing after the parties have submitted their position papers and supporting documents, he shall so inform the parties stating the reasons therefor and shall ask them to acknowledge the fact that they were so informed by signing the minutes of the hearing and the case shall be deemed submitted for resolution.As such, the PED Rules provided that the Hearing Officer may require the parties to submit their respective verified position papers, together with all supporting documents and affidavits of witnesses. A formal hearing was not mandatory; it was within the discretion of the Hearing Officer to determine whether there was a need for a formal hearing. Since, according to the foregoing rules, the holding of a hearing before the PED is discretionary, then the right to cross-examination could not have been demanded by either party.Secondly, it must be pointed out that Chapter 3, Book VII of the Administrative Code, entitled "Adjudication," does not affect the investigatory functions of the agencies. The law creating the PED, Section 8 of Presidential Decree No. 902-A, as amended, defines the authority granted to the PED, thus:SEC. 8. The Prosecution and Enforcement Department shall have, subject to the Commission's control and supervision, the exclusive authority to investigate, on complaint or motu proprio, any act or omission of the Board of Directors/Trustees of corporations, or of partnerships, or of other associations, or of their stockholders, officers or partners, including any fraudulent devices, schemes or representations, in violation of any law or rules and regulations administered and enforced by the Commission; to file and prosecutein accordance with law and rules and regulations issued by the Commission and in appropriate cases, the corresponding criminal or civil case before the Commission or the proper court or body upon prima facie finding of violation of any laws or rules and regulations administered and enforced by the Commission; and to perform such other powers and functions as may be provided by law or duly delegated to it by the Commission. (Emphasis provided.)The law creating PED empowers it to investigate violations of the rules and regulations promulgated by the SEC and to file and prosecute such cases. It fails to mention any adjudicatory functions insofar as the PED is concerned. Thus, the PED Rules of Practice and Procedure need not comply with the provisions of the Administrative Code on adjudication, particularly Section 12(3), Chapter 3, Book VII.In Cariño v. Commission on Human Rights,57 this Court sets out the distinction between investigative and adjudicative functions, thus:"Investigate," commonly understood, means to examine, explore, inquire or delve or probe into, research on, study. The dictionary definition of "investigate" is "to observe or study closely; inquire into systematically: "to search or inquire into" xx to subject to an official probe xx: to conduct an official inquiry." The purpose of an investigation, of course is to discover, to find out, to learn, obtain information. Nowhere included or intimated is the notion of settling, deciding or resolving a controversy involved in the facts inquired into by application of the law to the facts established by the inquiry.

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The legal meaning of "investigate" is essentially the same: "(t)o follow up step by step by patient inquiry or observation. To trace or track; to search into; to examine and inquire into with care and accuracy; to find out by careful inquisition; examination; the taking of evidence; a legal inquiry;" "to inquire; to make an investigation," "investigation" being in turn described as "(a)n administrative function, the exercise of which ordinarily does not require a hearing. 2 Am J2d Adm L Sec. 257; xx an inquiry, judicial or otherwise, for the discovery and collection of facts concerning a certain matter or matters.""Adjudicate," commonly or popularly understood, means to adjudge, arbitrate, judge, decide, determine, resolve, rule on, settle. The dictionary defines the term as "to settle finally (the rights and duties of parties to a court case) on the merits of issues raised: xx to pass judgment on: settle judicially: xx act as judge." And "adjudge" means "to decide or rule upon as a judge or with judicial or quasi-judicial powers: xx to award or grant judicially in a case of controversy x x x."In a legal sense, "adjudicate" means: "To settle in the exercise of judicial authority. To determine finally. Synonymous with adjudge in its strictest sense;" and "adjudge" means: "To pass on judicially, to decide, settle, or decree, or to sentence or condemn. x x x Implies a judicial determination of a fact, and the entry of a judgment."There is no merit to the respondent's averment that the sections under Chapter 3, Book VII of the Administrative Code, do not distinguish between investigative and adjudicatory functions. Chapter 3, Book VII of the Administrative Code, is unequivocally entitled "Adjudication."Respondents insist that the PED performs adjudicative functions, as enumerated under Section 1(h) and (j), Rule II; and Section 2(4), Rule VII of the PED Rules of Practice and Procedure:Section 1. Authority of the Prosecution and Enforcement Department - Pursuant to Presidential Decree No. 902-A, as amended by Presidential Decree No. 1758, the Prosecution and Enforcement Department is primarily charged with the following:x x x x(h) Suspends or revokes, after proper notice and hearing in accordance with these Rules, the franchise or certificate of registration of corporations, partnerships or associations, upon any of the following grounds:1. Fraud in procuring its certificate of registration;2. Serious misrepresentation as to what the corporation can do or is doing to the great prejudice of or damage to the general public;3. Refusal to comply or defiance of any lawful order of the Commission restraining commission of acts which would amount to a grave violation of its franchise;x x x x(j) Imposes charges, fines and fees, which by law, it is authorized to collect;x x x xSection 2. Powers of the Hearing Officer. The Hearing Officer shall have the following powers:x x x x4. To cite and/or declare any person in direct or indirect contempt in accordance with pertinent provisions of the Rules of Court.Even assuming that these are adjudicative functions, the PED, in the instant case, exercised its investigative powers; thus, respondents do not have the requisite standing to assail the validity of the rules on adjudication. A valid source of a statute or a rule can only be contested by one who will sustain a direct injury as a result of its enforcement.58 In the instant case, respondents are only being investigated by the PED for their alleged failure to disclose their negotiations with GHB and the transactions entered into by its directors involving IRC shares. The respondents have not shown

themselves to be under any imminent danger of sustaining any personal injury attributable to the exercise of adjudicative functions by the SEC. They are not being or about to be subjected by the PED to charges, fees or fines; to citations for contempt; or to the cancellation of their certificate of registration under Section 1(h), Rule II of the PED Rules of Practice and Procedure.To repeat, the only powers which the PED was likely to exercise over the respondents were investigative in nature, to wit:Section 1. Authority of the Prosecution and Enforcement Department - Pursuant to Presidential Decree No. 902-A, as amended by Presidential Decree No. 1758, the Prosecution and Enforcement Department is primarily charged with the following:x x x xb. Initiates proper investigation of corporations and partnerships or persons, their books, records and other properties and assets, involving their business transactions, in coordination with the operating department involved;x x x xe. Files and prosecutes civil or criminal cases before the Commission and other courts of justice involving violations of laws and decrees enforced by the Commission and the rules and regulations promulgated thereunder;f. Prosecutes erring directors, officers and stockholders of corporations and partnerships, commercial paper issuers or persons in accordance with the pertinent rules on procedures;The authority granted to the PED under Section 1(b), (e), and (f), Rule II of the PED Rules of Practice and Procedure, need not comply with Section 12, Chapter 3, Rule VII of the Administrative Code, which affects only the adjudicatory functions of administrative bodies. Thus, the PED would still be able to investigate the respondents under its rules for their alleged failure to disclose their negotiations with GHB and the transactions entered into by its directors involving IRC shares.This is not to say that administrative bodies performing adjudicative functions are required to strictly comply with the requirements of Chapter 3, Rule VII of the Administrative Code, particularly, the right to cross-examination. It should be noted that under Section 2.2 of Executive Order No. 26, issued on 7 October 1992, abbreviated proceedings are prescribed in the disposition of administrative cases:2. Abbreviation of Proceedings. All administrative agencies are hereby directed to adopt and include in their respective Rules of Procedure the following provisions:x x x x2.2 Rules adopting, unless otherwise provided by special laws and without prejudice to Section 12, Chapter 3, Book VII of the Administrative Code of 1987, the mandatory use of affidavits in lieu of direct testimonies and the preferred use of depositions whenever practicable and convenient.As a consequence, in proceedings before administrative or quasi-judicial bodies, such as the National Labor Relations Commission and the Philippine Overseas Employment Agency, created under laws which authorize summary proceedings, decisions may be reached on the basis of position papers or other documentary evidence only. They are not bound by technical rules of procedure and evidence. 59 In fact, the hearings before such agencies do not connote full adversarial proceedings.60 Thus, it is not necessary for the rules to require affiants to appear and testify and to be cross-examined by the counsel of the adverse party. To require otherwise would negate the summary nature of the administrative or quasi-judicial proceedings.61 In Atlas Consolidated Mining and Development Corporation v. Factoran, Jr.,62 this Court stated that:[I]t is sufficient that administrative findings of fact are supported by evidence, or negatively stated, it is sufficient that findings of fact are not shown to be unsupported by evidence. Substantial evidence is all

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that is needed to support an administrative finding of fact, and substantial evidence is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion."In order to comply with the requirements of due process, what is required, among other things, is that every litigant be given reasonable opportunity to appear and defend his right and to introduce relevant evidence in his favor.63

III. The Securities Regulations Code did not repeal Sections 8, 30 and 36 of the Revised Securities Act since said provisions were reenacted in the new law.The Securities Regulations Code absolutely repealed the Revised Securities Act. While the absolute repeal of a law generally deprives a court of its authority to penalize the person charged with the violation of the old law prior to its appeal, an exception to this rule comes about when the repealing law punishes the act previously penalized under the old law. The Court, in Benedicto v. Court of Appeals, sets down the rules in such instances:64

As a rule, an absolute repeal of a penal law has the effect of depriving the court of its authority to punish a person charged with violation of the old law prior to its repeal. This is because an unqualified repeal of a penal law constitutes a legislative act of rendering legal what had been previously declared as illegal, such that the offense no longer exists and it is as if the person who committed it never did so. There are, however, exceptions to the rule. One is the inclusion of a saving clause in the repealing statute that provides that the repeal shall have no effect on pending actions. Another exception is where the repealing act reenacts the former statute and punishes the act previously penalized under the old law. In such instance, the act committed before the reenactment continues to be an offense in the statute books and pending cases are not affected, regardless of whether the new penalty to be imposed is more favorable to the accused. (Emphasis provided.)In the present case, a criminal case may still be filed against the respondents despite the repeal, since Sections 8,65 12,66 26,67 2768 and 2369 of the Securities Regulations Code impose duties that are substantially similar to Sections 8, 30 and 36 of the repealed Revised Securities Act.Section 8 of the Revised Securities Act, which previously provided for the registration of securities and the information that needs to be included in the registration statements, was expanded under Section 12, in connection with Section 8 of the Securities Regulations Code. Further details of the information required to be disclosed by the registrant are explained in the Amended Implementing Rules and Regulations of the Securities Regulations Code, issued on 30 December 2003, particularly Sections 8 and 12 thereof.Section 30 of the Revised Securities Act has been reenacted as Section 27 of the Securities Regulations Code, still penalizing an insider's misuse of material and non-public information about the issuer, for the purpose of protecting public investors. Section 26 of the Securities Regulations Code even widens the coverage of punishable acts, which intend to defraud public investors through various devices, misinformation and omissions.Section 23 of the Securities Regulations Code was practically lifted from Section 36(a) of the Revised Securities Act. Both provisions impose upon (1) a beneficial owner of more than ten percent of any class of any equity security or (2) a director or any officer of the issuer of such security, the obligation to submit a statement indicating his or her ownership of the issuer's securities and such changes in his or her ownership thereof.Clearly, the legislature had not intended to deprive the courts of their authority to punish a person charged with violation of the old law that was repealed; in this case, the Revised Securities Act.IV. The SEC retained the jurisdiction to investigate violations of the Revised Securities Act, reenacted in the Securities Regulations Code, despite the abolition of the PED.

Section 53 of the Securities Regulations Code clearly provides that criminal complaints for violations of rules and regulations enforced or administered by the SEC shall be referred to the Department of Justice (DOJ) for preliminary investigation, while the SEC nevertheless retains limited investigatory powers.70 Additionally, the SEC may still impose the appropriate administrative sanctions under Section 54 of the aforementioned law.71

In Morato v. Court of Appeals,72 the cases therein were still pending before the PED for investigation and the SEC for resolution when the Securities Regulations Code was enacted. The case before the SEC involved an intra-corporate dispute, while the subject matter of the other case investigated by the PED involved the schemes, devices, and violations of pertinent rules and laws of the company's board of directors. The enactment of the Securities Regulations Code did not result in the dismissal of the cases; rather, this Court ordered the transfer of one case to the proper regional trial court and the SEC to continue with the investigation of the other case.The case at bar is comparable to the aforecited case. In this case, the SEC already commenced the investigative proceedings against respondents as early as 1994. Respondents were called to appear before the SEC and explain their failure to disclose pertinent information on 14 August 1994. Thereafter, the SEC Chairman, having already made initial findings that respondents failed to make timely disclosures of their negotiations with GHB, ordered a special investigating panel to hear the case. The investigative proceedings were interrupted only by the writ of preliminary injunction issued by the Court of Appeals, which became permanent by virtue of the Decision, dated 20 August 1998, in C.A.-G.R. SP No. 37036. During the pendency of this case, the Securities Regulations Code repealed the Revised Securities Act. As in Morato v. Court of Appeals, the repeal cannot deprive SEC of its jurisdiction to continue investigating the case; or the regional trial court, to hear any case which may later be filed against the respondents.V. The instant case has not yet prescribed.Respondents have taken the position that this case is moot and academic, since any criminal complaint that may be filed against them resulting from the SEC's investigation of this case has already prescribed.73 They point out that the prescription period applicable to offenses punished under special laws, such as violations of the Revised Securities Act, is twelve years under Section 1 of Act No. 3326, as amended by Act No. 3585 and Act No. 3763, entitled "An Act to Establish Periods of Prescription for Violations Penalized by Special Acts and Municipal Ordinances and to Provide When Prescription Shall Begin to Act."74 Since the offense was committed in 1994, they reasoned that prescription set in as early as 2006 and rendered this case moot. Such position, however, is incongruent with the factual circumstances of this case, as well as the applicable laws and jurisprudence.It is an established doctrine that a preliminary investigation interrupts the prescription period.75 A preliminary investigation is essentially a determination whether an offense has been committed, and whether there is probable cause for the accused to have committed an offense:A preliminary investigation is merely inquisitorial, and it is often the only means of discovering the persons who may be reasonably charged with a crime, to enable the fiscal to prepare the complaint or information. It is not a trial of the case on the merits and has no purpose except that of determining whether a crime has been committed or whether there is probable cause to believe that the accused is guilty thereof.76

Under Section 45 of the Revised Securities Act, which is entitled Investigations, Injunctions and Prosecution of Offenses, the Securities Exchange Commission (SEC) has the authority to "make such investigations as it deems necessary to determine whether any person has violated or is about to violate any provision of this Act XXX." After a finding that a person has violated the Revised Securities Act, the SEC may refer the case to the DOJ for preliminary investigation and prosecution.

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While the SEC investigation serves the same purpose and entails substantially similar duties as the preliminary investigation conducted by the DOJ, this process cannot simply be disregarded. In Baviera v. Paglinawan,77 this Court enunciated that a criminal complaint is first filed with the SEC, which determines the existence of probable cause, before a preliminary investigation can be commenced by the DOJ. In the aforecited case, the complaint filed directly with the DOJ was dismissed on the ground that it should have been filed first with the SEC. Similarly, the offense was a violation of the Securities Regulations Code, wherein the procedure for criminal prosecution was reproduced from Section 45 of the Revised Securities Act. 78 This Court affirmed the dismissal, which it explained thus:The Court of Appeals held that under the above provision, a criminal complaint for violation of any law or rule administered by the SEC must first be filed with the latter. If the Commission finds that there is probable cause, then it should refer the case to the DOJ. Since petitioner failed to comply with the foregoing procedural requirement, the DOJ did not gravely abuse its discretion in dismissing his complaint in I.S. No. 2004-229.A criminal charge for violation of the Securities Regulation Code is a specialized dispute. Hence, it must first be referred to an administrative agency of special competence, i.e., the SEC. Under the doctrine of primary jurisdiction, courts will not determine a controversy involving a question within the jurisdiction of the administrative tribunal, where the question demands the exercise of sound administrative discretion requiring the specialized knowledge and expertise of said administrative tribunal to determine technical and intricate matters of fact. The Securities Regulation Code is a special law. Its enforcement is particularly vested in the SEC. Hence, all complaints for any violation of the Code and its implementing rules and regulations should be filed with the SEC. Where the complaint is criminal in nature, the SEC shall indorse the complaint to the DOJ for preliminary investigation and prosecution as provided in Section 53.1 earlier quoted.We thus agree with the Court of Appeals that petitioner committed a fatal procedural lapse when he filed his criminal complaint directly with the DOJ. Verily, no grave abuse of discretion can be ascribed to the DOJ in dismissing petitioner's complaint.The said case puts in perspective the nature of the investigation undertaken by the SEC, which is a requisite before a criminal case may be referred to the DOJ. The Court declared that it is imperative that the criminal prosecution be initiated before the SEC, the administrative agency with the special competence.It should be noted that the SEC started investigative proceedings against the respondents as early as 1994. This investigation effectively interrupted the prescription period. However, said proceedings were disrupted by a preliminary injunction issued by the Court of Appeals on 5 May 1995, which effectively enjoined the SEC from filing any criminal, civil, or administrative case against the respondents herein.79 Thereafter, on 20 August 1998, the appellate court issued the assailed Decision in C.A. G.R. SP. No. 37036 ordering that the writ of injunction be made permanent and prohibiting the SEC from taking cognizance of and initiating any action against herein respondents. The SEC was bound to comply with the aforementioned writ of preliminary injunction and writ of injunction issued by the Court of Appeals enjoining it from continuing with the investigation of respondents for 12 years. Any deviation by the SEC from the injunctive writs would be sufficient ground for contempt. Moreover, any step the SEC takes in defiance of such orders will be considered void for having been taken against an order issued by a court of competent jurisdiction.An investigation of the case by any other administrative or judicial body would likewise be impossible pending the injunctive writs issued by the Court of Appeals. Given the ruling of this Court in Baviera v. Paglinawan,80 the DOJ itself could not have taken cognizance of the case and conducted its preliminary investigation without a prior determination of probable cause by the SEC. Thus, even presuming that

the DOJ was not enjoined by the Court of Appeals from conducting a preliminary investigation, any preliminary investigation conducted by the DOJ would have been a futile effort since the SEC had only started with its investigation when respondents themselves applied for and were granted an injunction by the Court of Appeals.Moreover, the DOJ could not have conducted a preliminary investigation or filed a criminal case against the respondents during the time that issues on the effectivity of Sections 8, 30 and 36 of the Revised Securities Act and the PED Rules of Practice and Procedure were still pending before the Court of Appeals. After the Court of Appeals declared the aforementioned statutory and regulatory provisions invalid and, thus, no civil, criminal or administrative case may be filed against the respondents for violations thereof, the DOJ would have been at a loss, as there was no statutory provision which respondents could be accused of violating.Accordingly, it is only after this Court corrects the erroneous ruling of the Court of Appeals in its Decision dated 20 August 1998 that either the SEC or DOJ may properly conduct any kind of investigation against the respondents for violations of Sections 8, 30 and 36 of the Revised Securities Act. Until then, the prescription period is deemed interrupted.To reiterate, the SEC must first conduct its investigations and make a finding of probable cause in accordance with the doctrine pronounced in Baviera v. Paglinawan.81 In this case, the DOJ was precluded from initiating a preliminary investigation since the SEC was halted by the Court of Appeals from continuing with its investigation. Such a situation leaves the prosecution of the case at a standstill, and neither the SEC nor the DOJ can conduct any investigation against the respondents, who, in the first place, sought the injunction to prevent their prosecution. All that the SEC could do in order to break the impasse was to have the Decision of the Court of Appeals overturned, as it had done at the earliest opportunity in this case. Therefore, the period during which the SEC was prevented from continuing with its investigation should not be counted against it. The law on the prescription period was never intended to put the prosecuting bodies in an impossible bind in which the prosecution of a case would be placed way beyond their control; for even if they avail themselves of the proper remedy, they would still be barred from investigating and prosecuting the case.Indubitably, the prescription period is interrupted by commencing the proceedings for the prosecution of the accused. In criminal cases, this is accomplished by initiating the preliminary investigation. The prosecution of offenses punishable under the Revised Securities Act and the Securities Regulations Code is initiated by the filing of a complaint with the SEC or by an investigation conducted by the SEC motu proprio. Only after a finding of probable cause is made by the SEC can the DOJ instigate a preliminary investigation. Thus, the investigation that was commenced by the SEC in 1995, soon after it discovered the questionable acts of the respondents, effectively interrupted the prescription period. Given the nature and purpose of the investigation conducted by the SEC, which is equivalent to the preliminary investigation conducted by the DOJ in criminal cases, such investigation would surely interrupt the prescription period.VI. The Court of Appeals was justified in denying SEC's Motion for Leave to Quash SEC Omnibus Orders dated 23 October 1995.The SEC avers that the Court of Appeals erred when it denied its Motion for Leave to Quash SEC Omnibus Orders, dated 23 October 1995, in the light of its admission that the PED had the sole authority to investigate the present case. On this matter, this Court cannot agree with the SEC.In the assailed decision, the Court of Appeals denied the SEC's Motion for Leave to Quash SEC Omnibus Orders, since it found other issues that were more important than whether or not the PED was the proper body to investigate the matter. Its refusal was premised on its earlier finding that no criminal, civil, or administrative case may be filed against the respondents under Sections 8, 30 and 36 of the

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Revised Securities Act, due to the absence of any implementing rules and regulations. Moreover, the validity of the PED Rules on Practice and Procedure was also raised as an issue. The Court of Appeals, thus, reasoned that if the quashal of the orders was granted, then it would be deprived of the opportunity to determine the validity of the aforementioned rules and statutory provisions. In addition, the SEC would merely pursue the same case without the Court of Appeals having determined whether or not it may do so in accordance with due process requirements. Absent a determination of whether the SEC may file a case against the respondents based on the assailed provisions of the Revised Securities Act, it would have been improper for the Court of Appeals to grant the SEC's Motion for Leave to Quash SEC Omnibus Orders.In all, this Court rules that no implementing rules were needed to render effective Sections 8, 30 and 36 of the Revised Securities Act; nor was the PED Rules of Practice and Procedure invalid, prior to the enactment of the Securities Regulations Code, for failure to provide parties with the right to cross-examine the witnesses presented against them. Thus, the respondents may be investigated by the appropriate authority under the proper rules of procedure of the Securities Regulations Code for violations of Sections 8, 30, and 36 of the Revised Securities Act.82

IN VIEW OF THE FOREGOING, the instant Petition is GRANTED. This Court hereby REVERSES the assailed Decision of the Court of Appeals promulgated on 20 August 1998 in CA-G.R. SP No. 37036 and LIFTS the permanent injunction issued pursuant thereto. This Court further DECLARES that the investigation of the respondents for violations of Sections 8, 30 and 36 of the Revised Securities Act may be undertaken by the proper authorities in accordance with the Securities Regulations Code. No costs.SO ORDERED.------------------------------------------------------------------x

CONCURRING OPINION

TINGA, J.:

While I fully concur with the ponencia ably penned by Justice Chico-Nazario, I write separately to highlight the factual and legal background behind the legal proscription against the blight that is "insider trading." This case is the farthest yet this Court has explored the matter, and it is heartening that our decision today affirms the viability for prosecutions against insider trading, an offense that assaults the integrity of our vital securities market. This case bears special significance, even if it does not dwell on the guilt or innocence of petitioners who are charged with insider trading, simply because the arguments raised by them essentially assail the validity of our laws against insider trading. Since we deny certiorari and debunk the challenge, our ruling will embolden our securities regulators to investigate and prosecute insider trading cases, thereby ensuring a more stable, mature and investor-friendly stock market.

The securities market, when active and vibrant, is an effective engine of economic growth. It is more able to channel capital as it tends to favor start-up and venture capital companies. To remain attractive to investors, however, the stock market should be fair and orderly. All the regulations, all the requirements, all the procedures and all the people in the industry should strive to achieve this avowed objective. Manipulative devices and deceptive practices, including insider trading, throw a monkey wrench right into the heart of the securities industry. When someone trades in the market with unfair

advantage in the form of highly valuable secret inside information, all other participants are defrauded. All of the mechanisms become worthless. Given enough of stock market scandals coupled with the related loss of faith in the market, such abuses could presage a severe drain of capital. And investors would eventually feel more secure with their money invested elsewhere.1

The securities market is imbued with public interest and as such it is regulated. Specifically, the reasons given for securities regulation are (1) to protect investors, (2) to supply the informational needs of investors, (3) to ensure that stock prices conform to the fundamental value of the companies traded, (4) to allow shareholders to gain greater control over their corporate managers, and (5) to foster economic growth, innovation and access to capital.2

In checking securities fraud, regulation of the stock market assumes quite a few forms, the most common being disclosure regulation and financial activity regulation.

Disclosure regulation requires issuers of securities to make public a large amount of financial information to actual and potential investors. The standard justification for disclosure rules is that the managers of the issuing firm have more information about the financial health and future of the firm than investors who own or are considering the purchase of the firm's securities. Financial activity regulation consists of rules about traders of securities and trading on or off the stock exchange. A prime example of this form of regulation is the set of rules against trading by insiders.3

I.

In its barest essence, insider trading involves the trading of securities based on knowledge of material information not disclosed to the public at the time.4 Such activity is generally prohibited in many jurisdictions, including our own, though the particular scope and definition of "insider trading" depends on the legislation or case law of each jurisdiction. In the United States, the rule has been stated as "that anyone who, for trading for his own account in the securities of a corporation has ‘access, directly or indirectly, to information intended to be available only for a corporate purpose and not for the personal benefit of anyone' may not take ‘advantage of such information knowing it is unavailable to those with whom he is dealing', i.e., the investing public."5

It would be useful to examine the historical evolution of the rule.

In the United States, legal abhorrence of insider trading preceded the modern securities market. Prior to 1900, it was treatise law that the doctrine that officers and directors of corporations are trustees of the stockholders does not extend to their private dealings with stockholders or others, though in such dealings they take advantage of knowledge gained through their official position.6 Under that doctrine, the misrepresentation or fraudulent concealment of a material fact by such corporate officers or directors gave rise to liability based on general fraud as understood in common law, yet such liability would arise only if the defendant actively prevented the plaintiff from looking into or inquiring upon the affairs or condition of the corporation and its prospects for dividends.7 The rule, as understood then, did not encompass a positive duty for public disclosure of any material information pertinent to a corporation and/or its securities.

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The first paradigm shift came with a decision in 1903 of the Georgia Supreme Court in Oliver v. Oliver,8 which pronounced that the shareholder had a right to disclosure, and the corporation a corresponding duty to disclose such material information, based on the principle that "[w]here the director obtains the information giving added value to the stock by virtue of his official position, he holds the information in trust for the benefit of [the shareholders]."9 Subsequent state jurisprudence affirmed this fiduciary obligation to disclose material nonpublic information to shareholders before trading with them, otherwise known as the "minority" or the "duty to disclose" rule. However, the U.S. Supreme Court in 1909 expressed preference for a different rule in Strong v. Repide,10 acknowledging that the corporate directors generally owed no duty to disclose material facts when trading with shareholders, unless there were "special circumstances" that gave rise to such duty. The "special circumstances," as identified in Strong, were the concealment of identity by the defendant, and the failure to disclose significant facts having a dramatic impact on the stock price.

Both the "special circumstances" and "duty to disclose" rules gained adherents in the next several years. In the meantime, the 1920s saw the unprecedented popularity of the stock market with the general public, which was widely taken advantage of by corporations and brokers through unscrupulous practices. The American stock market collapse of October 1929, which helped trigger the worldwide Great Depression, left fully half of the $25 million worth of securities floated during the post-First World War period as worthless, to the injury of thousands of individuals who had invested their life savings in those securities.11 The consequent wellspring of concern over the welfare of the investors animated the passage of the first U.S. federal securities laws, such as the Securities Exchange Act of 1934 which declared that "transactions in securities as commonly conducted upon securities exchanges and over-the-counter markets are affected with a national public interest which makes it necessary to provide for regulation and control of such transactions."12

Section 10(b) of the Securities Exchange Act of 1934 provided that:

It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce or of the mails, or of any facility of the national securities exchange ─ x x x

(b) To use or employ, in connection with the purchase or sale of any security registered on a national securities exchange or any security not so registered, any manipulative or deceptive device or contrivance in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors.13

It is this provision which stands as the core statutory authority prohibiting insider trading under U.S. federal law.14 Yet the provision itself does not utilize the term "insider trading," and indeed doubts have been expressed whether it was intended at all by the U.S. Congress to impose a ban on insider trading through the 1934 Securities Exchange Act.15 At the same time, the provision did grant to the U.S. Securities and Exchange Commission (U.S. SEC) the authority to promulgate rules and regulations "as necessary or appropriate in the public interest or for the protection of investors." This power was exercised by the U.S. SEC in 1942, when it enacted Rule 10b-5, which has been described as "the foundation on which the modern insider trading prohibition rests."16 The Rule reads:

It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or of any facility of any national securities exchange,

(a) To employ any device, scheme, or artifice to defraud,

(b) To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or

(c) To engage in any act, practice, or course of business which operates or would operate as a fraud or deceipt upon any person,

in connection with the purchase or sale of any security.17

Again, the rule by itself did not provide for an explicit prohibition on insider trading practices, and commentators have expressed doubts whether the U.S. SEC in 1942 had indeed contemplated that the rule work to such effect.18 Yet undoubtedly the Rule created a powerful antifraud weapon,19 and it would finally be applied by the U.S. SEC as a prohibition against insider trading in the 1961 case of In re Cady, Roberts & Co.20

The facts of that case hew closely to our traditional understanding of insider trading. A corporate director of Curtiss-Wright Corporation had told one of his business partners, Gimpel, that the board of directors had decided to reduce the company's quarterly dividend. Armed with such information even before the news was announced, Gimpel sold several thousand shares in the corporation's stock held in customer accounts over which he had discretionary trading authority. When the news of the reduced dividend was publicly disclosed, the corporation's share prices predictably dropped, and the owners of the sold shares were able to avoid injury. The U.S. SEC ruled that Gimpel had violated Rule 10b-5, even though he was not an insider privy to the confidential material information, but merely a "tippee" of that insider. In doing so, the U.S. SEC formulated the "disclose or abstain" rule, requiring that an insider in possession of material nonpublic information must disclose such information before trading or, if disclosure is impossible or improper, abstain from trading.21

Not long after, the American federal courts adopted the principles pronounced by the U.S. SEC in Cady, Roberts, and the rule

evolved that insider trading was deemed a form of securities fraud within the U.S. SEC's regulatory jurisdiction.22 Subsequently, jurisprudential limitations were imposed by the U.S. Supreme Court, ruling for example that an insider bears a duty to disclose on the basis of a fiduciary relationship of trust and confidence as between him and the shareholders;23 or that a tippee is liable for insider trading only if the tipper breached a fiduciary relationship by disclosing information to the tippee, who knew or had reason to know of the breach of duty.24 In response to these decisions, the U.S. SEC promulgated Rule 14e-3, which specifically prohibited insiders of the bidder and the target company from divulging confidential information about a tender offer to persons that are likely to violate the rule by trading on the basis of that information.25

In the United Kingdom, insider trading is considered as a type of "market abuse" assuming the form of behavior "based on information which is not generally available to those using the market but which, if available to a regular user of the market, would or would be likely to be regarded by him as relevant

CRIM CASES 27

when deciding the terms on which transactions in investments of the kind in question should be effected."26

The Philippines has adopted statutory regulations in the trading of securities, tracing in fact as far back as 1936, or just two years after the enactment of the US Securities Exchange Act of 1934. The then National Assembly of the Philippines enacted in 1936 Commonwealth Act No. 83, also known as the Securities Act,27 designed to regulate the sale of securities and to create a Securities and Exchange Commission (SEC) for that purpose. Notably, Com. Act No. 83 did not contain any explicit provision prohibiting insider trading in precise terms, even as it contained specific provisions prohibiting the manipulation of stock prices28 or the employment of manipulative and deceptive devices.29 This silence is unsurprising, considering that American federal law had similarly failed to enact so specific a prohibition and that Rule 10b-5 of the U.S. SEC had not yet come into existence then.

However, in January of 1973, the SEC would issue a set of rules,30 which required specific insiders to "make a resonably full, fair and accurate disclosure of every material fact relating or affecting it which is of interest to investors."31 It was explained therein that a fact is material if it "induces or tends to induce or otherwise affect the sale or purchase of the securities of the issuing corporation, such as an acquisition of mining claims, patent or formula, real estate, or similar capital assets; discovery of mineral ores; declaration of dividends; executing a contract of merger or consolidation; rights offering; and any other important event or happening."32

The enactment of the Revised Securities Act in 1980 (Batas Pambansa Blg. 178, as amended) provided for the first time a specific statutory prohibition in Philippine law against insider trading. This was embodied in Section 30 of the law, which provides:

Sec. 30. Insider's duty to disclose when trading - (a) It shall be unlawful for an insider to sell or buy a security of the issuer, if he knows a fact of special signifinace whith respest to the issuer or the security that is not generally available, unless (1) the insider proves that the fact is generally available or (2) if the other party to the transaction (or his agent ) is identified, (a) the insider proves that the other party knows it, or (b) that other party in fact knows it from the insider or otherwise.

(b) "Insider" means (1) the issuer, (2) a director or officer of, or a person controlling, controlled by, or under common control with, the issuer, (3) a person whose relationship or former relationship to the issuer gives or gave him access to a fact of special significance about the issuer or the security that is not generally available, or (4) a person who learns such a fact from any of the foregoing insiders as defined in this subsection, with knowledge that the person from whom he learns the fact is such an insider.

(c) A fact is "of special significance" if (a) in addition to being material it would be likely, on being made generally available, to affect the market price of a security to a significant extent, or (b) a reasonable person would consider it especially important under the circumstances in determining his course of action in the light of such factors as the degree of its specificity, the extent of its difference from information generally available previously, and its nature and reliability.

(d) This section shall apply to an insider as defined in subsection (b) (3) hereof only to the extent that he knows of a fact of special significance by virtue of his being an insider.

Contrary to the claims of respondents, such terms as "material fact," "reasonable person," "nature and reliability" and "generally available" as utilized in Section 30 do not suffer from the vice of vagueness and do not necessitate an administrative rule to supply definitions of the terms either. For example, as the ponente points out, the 1973 Rules already provided for a definition of a "material fact," a definition that was actually incorporated in Section 30.

Yet there is an underlying dangerous implication to respondents' arguments which makes the Court's rejection thereof even more laudable. The ability of the SEC to effectively regulate the securities market depends on the breadth of its discretion to undertake regulatory activities. The intractable adherents of laissez-faire absolutism may decry the fact that there exists an SEC in the first place, yet it is that body which assures the protection of interests of ordinary stockholders and investors in the capital markets, interests which may be overlooked by the issuers of securities and their corporate overseers whose own interests may not necessarily align with that of the investing public. A "free market" that is not a "fair market" is not truly free, even if left unshackled by the State as it would in fact be shackled by the uninhibited greed of only the largest players.

Respondents essentially contend that the SEC is precluded from enforcing its statutory powers unless it first translates the statute into a more comprehensive set of rules. Without denigrating the SEC's delegated rule-making power, each provision of the law already constitutes an executable command from the legislature. Any refusal on the part of the SEC to enforce the statute on the premise that it had yet to undergo the gauntlet of administrative interpretation is derelict to that body's legal mandate. By no means is the Congress impervious to the concern that certain statutory provisions are best enforced only after an administrative regulation implementing the same is promulgated. In such cases, the legislature is solicitous enough to specifically condition the enforcement of the statute upon the promulgation of the relevant administrative rules. Yet in cases where the legislature does not see fit to impose such a conditionality, the body tasked with enforcing the law has no choice but to do so. Any quibbling as to the precise meaning of the statutory language would be duly resolved through the exercise of judicial review.

It bears notice that unlike the American experience where the U.S. Congress has not seen fit to specifically legislate prohibitions on insider trading, relying instead on the discretion of the U.S. SEC to penalize such acts, our own legislature has proven to be more pro-active in that regard, legislating such prohibition, not once, but twice. The Revised Securities Act was later superseded by the Securities Regulation Code of 2000 (Rep. Act No. 8799), a law which is admittedly more precise and ambitious in its regulation of such activity. The passage of that law is praiseworthy insofar as it strengthens the State's commitment to combat insider trading. And the promulgation of this decision confirms that the judiciary will not hesitate in performing its part in seeing to it that our securities laws are properly implemented and enforced.

III

I also wish to share my thoughts on the issue of principles.

CRIM CASES 28

The issue boils down to the determination of whether the investigation conducted by the SEC pursuant to Section 4533 of the Revised Securities Act in 1994 tolled the running of the period of prescription. I submit it did.

Firstly, this Court, in ruling in Baviera v. Paglinawan34 that the Department of Justice cannot conduct a preliminary investigation for the determination of probable cause for offenses under the Revised Securities Code, without an investigation first had by the SEC, essentially underscored that the exercise is a two-stage process. The procedure is similar to the two-phase preliminary investigation prior to the prosecution of a criminal case in court under the old rules.35 The venerable J.B.L. Reyes in People v. Olarte36 finally settled a long standing jurisprudential conflict at the time by holding that the filing of the complaint in the Municipal Court, even if it be merely for purposes of preliminary examination or investigation, should, and does, interrupt the period of prescription of the criminal responsibility, even if the court where the complaint or information is filed cannot try the case on its merits. The court gave three reasons in support of its decision, thus:

. . . Several reasons buttress this conclusion: first the text of Article 91 of the Revised Penal Code, in declaring that the period of prescription "shall be interrupted by the filing of the complaint or information" without distinguishing whether the complaint is filed in the court for preliminary examination or investigation merely, or for action on the merits. Second, even if the court where the complaint or information is filed may only proceed to investigate the case its actuations already represent the initial step of the proceedings against the offender. Third, it is unjust to deprive the injured party of the right to obtain vindication on account of delays that are not under his control. All that the victim of the offense may do not on his part to initiate the prosecution is to file the requisite complaint.37

The same reasons which moved the Court in 1967 to declare that the mere filing of the complaint, whether for purposes of preliminary examination or preliminary investigation should interrupt the prescription of the criminal action inspire the Court's ruling in this case.

It should be emphasized that Sec. 45 of the Revised Securities Act invests the SEC with the power to "make such investigations as it deems necessary to determine whether any person has violated or is about to violate any provision of this Act or any rule or regulation thereunder, and may require or permit any person to file with it a statement in writing, under oath or otherwise, as the Commission shall determine, as to all facts and circumstances concerning the matter to be investigated" and to refer criminal complaints for violations of the Act to the Department of Justice for preliminary investigation and prosecution before the proper court.

The SEC's investigatory powers are obviously akin to the preliminary examination stage mentioned in People v. Olarte. The SEC's investigation and determination that there was indeed a violation of the provisions of the Revised Securities Act would set the stage for any further proceedings, such as preliminary investigation, that may be conducted by the DOJ after the case is referred to it by the SEC.

Secondly, Sec. 2 of Act No. 332638 provides in part:

Prescription shall begin to run from the day of the commission of the violation of the law, and if the same be not known at the time, from the discovery thereof and the institution of judicial proceedings

for its investigation and punishment. The prescription shall be interrupted when proceedings are instituted against the guilty person, and shall begin to run again if the proceedings are dismissed for reasons not constituting jeopardy. (Emphasis supplied)

Act No. 3326 was approved on 4 December 1926, at a time that the function of conducting the preliminary investigation of criminal offenses was vested in the justices of the peace. The prevailing rule at the time, embodied in the early case of U.S. v. Lazada39 and later affirmed in People v. Joson,40 is that the prescription of the offense is halted once the complaint is filed with the justice of the peace for preliminary investigation inasmuch as the filing of the complaint signifies the institution of criminal proceedings against the accused.41 People v. Parao42—a case which affirmed the power of the then municipal president to conduct preliminary investigation in the absence of the justice of the peace and of the auxiliary justice of the peace when the same could not be deferred without prejudice to the interest of justice—established the correlative rule that the first step taken in the investigation or examination of offenses partakes the nature of a judicial proceedings which suspends the prescription of the offense.43 But although the second Olarte44 case made an affirmative ruling that the preliminary investigation is not part of the action proper, the Court therein nevertheless declared that such investigation is quasi-judicial in nature and that as such, the mere filing of the complaint with the justice of the peace should stall the exhaustion of the prescriptive period of the offense charged.

While it may be observed that the term "judicial proceedings" in Sec. 2 of Act No. 3326 appears before "investigation and punishment" in the old law, with the subsequent change in set-up whereby the investigation of the charge for purposes of prosecution has become the exclusive function of the executive branch, the term "proceedings" should now be understood either executive or judicial in character: executive when it involves the investigation phase and judicial when it refers to the trial and judgment stage. With this clarification, any kind of investigative proceeding instituted against the guilty person which may ultimately lead to his prosecution as provided by law shall suffice to toll prescription.

Thus, in the case at bar, the initiation of investigative proceedings against respondents, halted only by the injunctive orders issued by the Court of Appeals upon their application no less, should and did interrupt the prescriptive period of the criminal action.

DANTE O. TINGA

CRIM CASES 29

PEOPLE OF THE PHILIPPINES, appellee, vs. CIRILO MAGALONA y ONOON alias “WILLIAM,” appellant.D E C I S I O NPER CURIAM:

Before us, for automatic review, is the Decision[1] of the Regional Trial Court of Nueva Ecija, Branch 29, Cabanatuan City, in Criminal Case No. 5899-AF, finding appellant Cirilo Magalona guilty of the complex crime of Murder with Multiple Frustrated Murder and Multiple Attempted Murder and sentencing him to suffer the death penalty.

The Information[2] filed against appellant reads:

That on or about the 25th day of May, 1994, around 3:30 o’ clock in the morning, at Sitio Ablang, Brgy. Sta Lucia Old, Municipality of Zaragoza, Province of Nueva Ecija, and within the jurisdiction of this Honorable Court, the above-named accused, with intent to kill, evident premeditation, treachery, taking advantage of night time and with the use of a hand grenade, did then and there willfully, unlawfully and feloniously throw the said hand grenade under the hut of one ROSENDO ARIMBUYUTAN, SR. which exploded, thereby hitting five (5) persons then sleeping in the said hut, namely: ROSARIO TORRES ARIMBUYUTAN, ROSALYN ARIMBUYUTAN, ROSEMARIE ARIMBUYUTAN, ROLDAN ARIMBUYUTAN AND RESTY ARIMBUYUTAN, which caused the instantaneous death of the latter and multiple blasting injuries to the first four-named persons, thus, with respect to them, the accused had performed all the acts of execution which could produce the crime of MURDER, but nevertheless did not produce it by reason of some causes independent of the will of the perpetrator, that is, the timely medical attendance extended to them which prevented their death, to the damage and prejudice of the herein victims.

CONTRARY TO LAW.

When arraigned on August 5, 1994, appellant pleaded not guilty.[3] Trial ensued.

The Prosecution’s Evidence

On May 25, 1994, the spouses Rosendo and Rosario Arimbuyutan and their children resided at Sitio Ablang, Barangay Sta. Lucia Old, Zaragoza, Nueva Ecija. Their hut, including the floor, was made of bamboo, while the roof was made of “talahib.” The floor of their hut was three feet above the ground.[4]

At around 3:30 a.m. of said date, while the spouses Arimbuyutan and their children, namely, Rommel, Rosendo, Jr., Rosalie, Rosemarie, Regina, Ruby, Roldan and Resty, were sleeping in their hut, there was an explosion beneath the floor. Said explosion killed Resty and injured Rosario, Roldan, Rosemarie and Rosalie.[5] It also caused a small crater on the ground and damage to the hut up to the roof.[6]

The victims were first brought to the medical center of the neighboring town of La Paz, Tarlac, and then to the Tarlac Provincial Hospital.[7] On the way to the hospital, Resty Arimbuyutan died[8] of hemorrhage secondary to “multiple blasting injury.”[9]

Rosario Arimbuyutan sustained “blastin[g] injury multiple with perforation of the uterus.”[10] Rosario Arimbuyutan testified that she sustained injuries from her waist to her knees and underwent a surgical operation.[11]

Rosalyn Arimbuyutan sustained a fracture over the left kneecap.[12]

Rosemarie Arimbuyutan sustained a “blasting injury left gluteal area (left buttocks),”[13] and was immediately given medicine for anti-tetanus.[14] Dr. Renato Ang, who attended to Rosemarie, testified that without said prompt medical treatment, she could have died of complications that could have arisen from the wound she sustained.[15]

Roldan Arimbuyutan sustained “blasting injury multiple posterior chest left.”[16] He was given emergency treatment called “tube thoracostomy” to prevent his lungs from collapsing.[17] Dr. Renato Ang, who attended to Roldan, testified that without said medical treatment, the patient would have died.[18]

Rosario Arimbuyutan testified that they spent P21,400[19] for hospitalization, medical expenses, as well as, the funeral and burial expenses of her son, Resty Arimbuyutan.[20]

At around 8 a.m. of May 25, 1994, Police Officer Rodolfo Gutierrez of the Philippine National Police of Zaragoza, together with two police officers and a photographer, investigated the grenade-throwing incident at Sitio Ablang, Barangay Sta. Lucia Old, Zaragoza, Nueva Ecija. Gutierrez found a safety lever pin (Exhibit “E”) and some grenade shrapnels (Exhibit “F”) near the post of the hut of Rosendo Arimbuyutan, Sr. He was informed that the victims of the explosion were already brought to the hospital. He made an investigation report[21] of said incident.[22] He also entered the incident in the police blotter.[23]

According to Gutierrez, based on the sworn statements of Rosendo Arimbuyutan, Sr., Bienvenido Sabater and Adelina Mendoza, the suspect was appellant Cirilo Magalona alias William. They did not search for appellant anymore because Barangay Captain Florentino Almeda[24] of Sta. Lucia, Zaragoza, Nueva Ecija, brought him to the police station in the morning of May 25, 1994. Almeda told Gutierrez that since appellant became a suspect of a rape case, appellant had already been in his (Almeda) custody up to the time he was surrendered to the police authorities. The rape incident was reported to the police authorities on May 24, 1994 at 2 p.m.[25]

Bienvenido Sabater,[26] 40 years old, a farmer and a resident of Barangay Patola, Talugtug, Nueva Ecija, testified that on May 25, 1994, he was residing at Sitio Ablang, Sta. Lucia Old, Zaragoza, Nueva Ecija. His immediate neighbor then was Rosendo “Sendong” Arimbuyutan, Sr., whose hut was about five (5) to six (6) meters away from his hut. Their huts were fronting each other.[27]

Sabater narrated that at around 3:30 a.m. of May 25, 1994, he was inside his hut sitting on a bamboo bed. He was pacifying his six-month-old child and, at the same time, drinking coffee, while his wife was boiling water for his child’s milk. His child was lying on his side while he was gently tapping him to stop him from crying. Sabater demonstrated that he was seated on the bed, which was beside the window on his left, while he was facing the open door. His door and window had no shutters and were

CRIM CASES 30

just open. The hut was not their permanent residence and they just stayed there during the farming season.[28]

While he was taking coffee, Sabater saw a person, named William, pass by in front of his hut and the hut of Rosendo Arimbuyutan, Sr. He also saw William hiding behind the acacia tree in front of his hut, which was about five (5) to six (6) meters away. Said acacia tree was between his hut and the hut of Arimbuyutan. Then he saw an explosion under the floor of the hut of Arimbuyutan and saw William running towards the direction of the “flood control. “[29]

Upon hearing the explosion, Sabater immediately took his child and lay face down on the floor in front of the open door for four to five seconds. He was facing their open door; hence, he saw William run away, and when he noticed that William was not with somebody, he stood up. He heard the family of Rosendo Arimbuyutan, Sr. crying.[30]

Sabater testified that he recognized the person who passed by his hut and who hid behind the acacia tree to be someone named William, because the latter frequently went to their place in Sitio Ablang. He stated that he also recognized William at 3:30 a.m., because the moon was bright and he had a lighted kerosene lamp hanging by the post. Since the door of his hut was open, the light from the kerosene lamp illuminated William who was hiding behind the acacia tree near his hut. In the courtroom, he pointed to the person whom he called “William,’” who, when asked, identified himself as Cirilo Magalona.[31]

Sabater testified that appellant was a farm worker of one Corazon Ramos on a commission basis at Sitio Ablang.[32]

Sabater admitted that he did not actually see who threw the grenade under the hut of Rosendo Arimbuyutan, Sr.[33]

Adelina Mendoza, 71 years old, a housekeeper, testified that she knew appellant because he was her neighbor. At midnight of May 22, 1994, while she was drinking coffee in her house at Sitio Ablang, appellant knocked at her door and conversed with her. He told her that he was very angry at Rosendo Arimbuyutan, Sr. and that he would return and kill him.[34]

On cross-examination, Mendoza testified that she knew appellant for less than a year. She had seen appellant many times but talked to him only once before the grenade explosion. She admitted that Rosendo Arimbuyutan, Sr. was her nephew.[35]

On December 2, 1996, Rosendo Arimbuyutan, Sr. executed an Affidavit of Desistance.[36] The Court disregarded said affidavit since the prosecution had already rested its case and it was the turn of the defense to present its evidence.[37]

Appellant’s Escape Deemed Waiverof His Right to Present Evidence

In the hearing scheduled on July 18, 1997, appellant did not appear in court. The trial court ordered the Provincial Warden of Nueva Ecija to explain why he should not be held in contempt for the non-

appearance of appellant during the said hearing. In his letter,[38] the Provincial Warden explained that pursuant to a COMELEC Resolution,[39] the Provincial Jail was under the control of the Philippine National Police (PNP) starting April 23, 1995. He stated that the policemen assigned to the Provincial Jail ordered appellant to guard a co-detainee who was confined in the hospital and who died on July 8, 1997. After the detainee’s death, appellant did not return to the Provincial Jail.

The Court issued an Order dated August 21, 1997 directing the PNP Provincial Director of Nueva Ecija to investigate the escape of appellant, which was reiterated in another Order[40] dated February 16, 1998. In the latter Order, the Court, as prayed for by the Assistant Provincial Prosecutor, deemed the appellant to have waived his right to present evidence. Consequently, the case was considered submitted for decision.

The Trial Court’s Ruling

The trial court held that the testimony of Avelina Mendoza showed that appellant had a motive to harm complainant Rosendo Arimbuyutan, Sr.[41] It also ruled that the testimony of Bienvenido Sabater established that appellant was responsible for the explosion which killed Resty Arimbuyutan and injured Rosario, Rosemarie, Rosalyn and Roldan, all surnamed Arimbuyutan.[42] Moreover, the trial court considered appellant’s escape from prison as persuasive evidence of his guilt.[43]

On July 30, 1998, the trial court pronounced judgment, thus:

WHEREFORE, this court finds the accused CIRILO MAGALONA y ONOON guilty of the crime of MURDER with Multiple Frustrated Murder and Multiple Attempted Murder, and hereby sentences him to suffer the maximum penalty of DEATH, and to pay the Spouses Rosendo Arimbuyutan, Sr. and Rosario Arimbuyutan FIFTY THOUSAND PESOS (P50,000.00) as indemnity for the death of their son Resty Arimbuyutan, moral damages of ONE HUNDRED THOUSAND PESOS (P100,000.00) and actual damages of TWENTY ONE THOUSAND FOUR HUNDRED PESOS (P21,400.00).

INASMUCH as the accused Cirilo Magalona who has been sentenced to death penalty in absencia because he escaped from the custody of members of the PNP who were then in charge of the Provincial Jail of Nueva Ecija by assigning him to guard a co-detainee in a hospital on or about July 8, 1997, furnish a copy of this Decision to the Chief of the Philippine National Police, Camp Crame, Quezon City for a proper investigation of the anomalous escape of said accused.

SO ORDERED.[44]

On May 21, 1999, the Provincial Warden of the Provincial Jail of Nueva Ecija informed the trial court that appellant had been arrested and was detained at the Provincial Jail.[45]

Appellant contends that the trial court erred, thus:

I

THE TRIAL COURT ERRED IN GIVING CREDIT TO THE TESTIMONIES OF WITNESSES AVELINA MENDOZA AND BIENVENIDO SABATER;[46]

CRIM CASES 31

II

THE TRIAL COURT ERRED IN CONVICTING THE ACCUSED CIRILO MAGALONA.[47]

The Court’s Ruling

Appellant contends that the trial court erred in giving credence to the testimonies of prosecution witnesses Avelina Mendoza and Bienvenido Sabater.

Appellant asserts that the trial court should not have given any probative value to Avelina Mendoza’s testimony in determining the motive behind the incident for two reasons: First, the witness and appellant are not long-time acquaintances, having talked to each other only once. The alleged revelation to kill Rosendo Arimbuyutan, Sr. to a stranger during a visit at midnight is contrary to ordinary human experience. Second, Mendoza is the aunt of complainant Rosendo Arimbuyutan, Sr.[48]

We disagree.

Appellant cannot consider Avelina Mendoza a stranger as Mendoza testified that she knew appellant since he was her neighbor.[49] Being neighbors, it is not contrary to human experience for appellant to have visited Mendoza at midnight of May 22, 1994. It was incumbent on appellant to disprove said visit. Having failed to do so, the positive testimony of Mendoza prevails.

Moreover, although Avelina Mendoza is the aunt of complainant Rosendo Arimbuyutan, Sr., such relationship does not, by itself, impair Mendoza’s credibility as a witness.[50] On the contrary, her relationship to Arimbuyutan would deter her from implicating innocent persons as her natural interest would be to secure the conviction of the real culprit.”[51]

The testimony of Avelina Mendoza established appellant’s motive to kill Rosendo Arimbuyutan, Sr., thus:

Fiscal Beltran:

Q Mrs. Witness, do you know Cirilo Magalona alias William?

A Yes, sir.

Q Why do you know him?

A He is my neighbor, sir.

xxx xxx xxx

Q On May 22, 1994 at around 12:00 midnight, do you remember where were you?

A Yes, sir.

Q Where were you at that time?

A In our house, sir.

Q Where is that house of yours located?

A At Sitio Ablang, sir.

Q What were you doing in your house at that time?

A I was drinking coffee, sir.

Q While you were drinking coffee on that date and time, what happened?

A Somebody knocked at our door and had a conversation with me, sir.

Q Who is that somebody who knocked at your door and had a conversation with you?

A That man, sir. (Witness pointed to the accused who when asked his name and [sic] he answered as Cirilo Magalona).

Q Was Cirilo Magalona alone when he knocked at your door and had a short conversation with you?

A Yes, sir.

Q What did you talk about?

A He told me that he is angry at Sendo (Rosendo Arimbuyutan, Sr.)

Q Did you ask him why he is angry at Sendo (Rosendo Arimbuyutan, Sr.)?

A Yes, I asked him and he told me that he is very angry with Rosendo Arimbuyutan and that he will come back and kill Rosendo Arimbuyutan, sir.

Q Did you ask him what xxx they talked about with Rosendo Arimbuyutan, Sr.?

A No more, sir. He just told me that he is very angry with Rosendo Arimbuyutan, Sr., sir.[52]

On cross-examination, Avelina Mendoza further testified, thus:

Atty. R. Bansale-

xxx xxx xxx

CRIM CASES 32

Q Can you repeat again what was the exact words uttered by Cirilo Magalona on that night of May 22, 1994?

A I remember some of the words uttered, that if “Sendong” will report the matter he will return and there will be something happened against to [sic] Sendong “you son of a bitch.”

Q You said that Cirilo Magalona only had a [talk] with you on the night of May 22, 1994, why do you think that he will tell those remarks against [that] person to you?

A It has something to do with the one that he had raped and he said that if Sendong will [complain] he will do something against him, sir.

Q On that night of May 22, 1994 when Cirilo Magalona went to your house, how long did he stay in your house?

A For a short period after he uttered those [remarks] he already left, sir.[53]

Appellant also asserts that prosecution witness Bienvenido Sabater admitted that he did not actually see who threw the hand grenade under the hut of Rosendo Arimbuyutan, Sr.[54] He argues that Sabater only established that he saw him (appellant) hiding behind an acacia tree and then running away from the place of the explosion,[55] which are insufficient to prove his guilt beyond reasonable doubt. Hence, appellant prays for his acquittal.

The contention is without merit.

The trial court convicted appellant based on circumstantial evidence. Direct evidence of the commission of the crime is not indispensable for convicting an accused when circumstantial evidence can sufficiently establish his guilt.[56] There can be a judgment of conviction when the circumstances proved constitute an unbroken chain of events that leads to a fair and reasonable conclusion pinpointing the accused, to the exclusion of all others, as the perpetrator of the crime.[57] Under Rule 133, Section 4 of the Rules of Court, circumstantial evidence is sufficient for conviction if: (1) there is more than one circumstance; (2) the facts from which the inferences are derived are proven; and (3) the combination of all the circumstances is such as to produce a conviction beyond reasonable doubt.

In this case, although prosecution witness Bienvenido Sabater did not see appellant holding a hand grenade or throwing it under the hut of Rosendo Arimbuyutan, Sr., the following chain of events points to appellant as the perpetrator of the crime:

First, on May 22, 1994, appellant told Avelina Mendoza that he was very angry at Rosendo Arimbuyutan, Sr. and would return and kill him.[58]

Second, on May 25, 1994, at about 3:30 a.m., Bienvenido Sabater saw appellant pass by his hut and the hut of Rosendo Arimbuyutan.[59]

Third, Sabater saw appellant acting suspiciously as he went back and forth between his hut and the hut of Rosendo Arimbuyutan, Sr., which were fronting each other.[60]

Fourth, Sabater saw appellant hiding behind the acacia tree in front of his hut.[61]

Fifth, Sabater thereafter saw an explosion under the hut of Rosendo Arimbuyutan, Sr. and saw appellant fleeing from the place of the incident as he was running towards the direction of the “flood control” at the river.[62]

Sixth, appellant was the only person seen near the hut of Rosendo Arimbuyutan, Sr. before and after the explosion.

Sabater testified that he recognized appellant because he frequently visited their place.[63] He knew appellant for about two years since he began farming at Sitio Ablang.[64] Sabater also testified that at the time of the incident, the moon shone brightly,[65] and the light from the kerosene lamp near his open door illuminated appellant who was hiding behind the acacia tree, which was about five (5) to six (6) meters away from his hut.[66]

The culpability of appellant is strengthened by his flight from the site of the explosion. The Court has ruled that flight of an accused from the scene of the crime removes any remaining shred of doubt on his guilt.[67] If appellant were not guilty, he would not have fled but would have gone to the hut of Rosendo Arimbuyutan, Sr. after the explosion and rendered assistance to the victims. Moreover, the testimony of Avelina Mendoza established that appellant had a motive to harm Rosendo Arimbuyutan, Sr., which is a key element in the web of circumstantial evidence.[68]

Further, there is no evidence showing that Sabater was impelled by improper motive in testifying against appellant; hence, his testimony deserves full faith and credence.[69] It is well settled that the positive testimony of a credible witness is sufficient to support a judgment of conviction because truth is established by the quality, not the quantity, of the evidence.[70]

It is also a well-entrenched rule that when it comes to the issue of credibility of witnesses, the appellate court generally will not overturn the findings of the trial court since the trial judge is in a better position to determine the issue of credibility, having observed the deportment of witnesses during the trial.[71] Thus, the trial court’s findings will not be disturbed on appeal unless the trial court overlooked, misunderstood or misapplied some fact or circumstance of weight and substance which will alter the assailed decision or affect the result of the case.[72] We have carefully reviewed the records of this case and found no reason to disturb the findings of the trial court.

In addition, we agree with the trial court that the flight of appellant after the death of the co-detainee he was guarding at the hospital is taken to signify a strong sense of guilt and an awareness that he has no tenable defense.[73]

Based on the foregoing, the trial court correctly found appellant guilty beyond reasonable doubt of the crime charged.

Nature of the Offense

CRIM CASES 33

Even if appellant, in detonating a hand grenade under the hut of Rosendo Arimbuyutan, Sr., intended to kill Rosendo, but instead killed his son, Resty, and seriously injured other family members, appellant is liable for all the consequences of his unlawful act. Where such unlawful act is wilfully done, a mistake in the identity of the intended victim cannot be considered as reckless imprudence.[74] Where malice or intention to cause injury exists, the act should be qualified by the felony it has produced.[75]

The trial court correctly held that the death of Resty Arimbuyutan and the injuries sustained by Rosario, Rosemarie, Rosalyn and Roldan, all surnamed Arimbuyutan, were caused by an explosion, which qualified the killing to murder under Article 248 of the Revised Penal Code, thus:

Art. 248. Murder. - Any person who, not falling within the provisions of Article 246 shall kill another, shall be guilty of murder and shall be punished by reclusion perpetua to death if committed with any of the following attendant circumstances:

1. With treachery, taking advantage of superior strength, with the aid of armed men, or employing means to weaken the defense or of means or persons to insure or afford impunity.

xxx xxx xxx

3. By means of inundation, fire, poison, explosion, shipwreck, stranding or a vessel, derailment or assault upon a railroad, fall of an airship, or by means of motor vehicles, or with the use of any other means involving great waste and ruin.

The trial court, however, incorrectly stated that the killing was also attended by the qualifying circumstance of treachery. Absent any particulars on the manner in which the aggression was commenced, treachery cannot be appreciated to qualify the killing to murder.[76] Treachery cannot be presumed, but must be proved with the same quantum of evidence as the crime itself.[77] Nevertheless, the presence of the qualifying circumstance of explosion, which was alleged in the Information, is sufficient to qualify the killing to murder.

As stated by the trial court, the injuries of Rosario and Rosemarie Arimbuyutan appeared to be fatal based on their medical certificates and the fact that Rosario underwent an operation at the Tarlac Provincial Hospital. The prosecutor, however, failed to ask Dr. Arnold Castro, who attended to Rosario and Rosemarie, if their injuries would have caused their death without prompt medical treatment. With respect to Roldan and Rosalyn Arimbuyutan, Dr.Renato Ang testified that their wounds would have caused their death without his prompt medical treatment.[78]

Considering that the offenses committed against the victims were caused by a single act of detonating a hand grenade, the trial court found appellant guilty of the complex crime of murder with multiple frustrated murder and multiple attempted murder under Article 48 of the Revised Penal Code. To be precise, appellant committed the complex crime of murder with double frustrated murder and double attempted murder.

The Penalty

Under Article 48 (Penalty for complex crimes) of the Revised Penal Code, when a single act constitutes two or more grave or less grave felonies, as in this case, the penalty for the most serious crime shall be imposed, the same to be applied in its maximum period.

Applying the aforesaid provision of law in this case, the penalty for the most serious crime (murder), which is reclusion perpetua to death, should be imposed in the maximum period. The trial court, therefore, correctly imposed the death penalty.

Three Justices of the Court maintain their position that Republic Act No. 7659 is unconstitutional insofar as it prescribes the death penalty; nevertheless, they submit to the ruling of the majority that the law is constitutional, and that the death penalty can be lawfully imposed in the case at bar.

Damages

The actual damages awarded by the trial court in the amount of P21,400 for the funeral, burial and other expenses incurred by the Arimbuyutans due to the death of Resty Arimubuyutan is deleted. Actual damages cannot be awarded based merely on a list of expenses[79] presented by the prosecution, as such claim must be adequately supported by receipts.[80] However, in lieu thereof, temperate damages under Article 2224[81] of the Civil Code may be recovered as it has been shown that the family of the deceased suffered some pecuniary loss, but the amount thereof cannot be proved with certainty.[82] An award of P15,000 should suffice.[83]

In addition, we award actual damages to the spouses Rosendo and Rosario Arimbuyutan in the amount of P6,900.05 for the medical expenses of Rosario Arimbuyutan and her children, Rosemarie, Rosalyn and Roldan, which were duly supported by receipts.[84]

The trial court correctly awarded civil indemnity to the heirs of the victim, Resty Arimbuyutan, in the amount of P50,000, without need of proof other than the fact that a crime was committed resulting in the death of the victim and that the accused was responsible therefor.[85]

The trial court also correctly awarded moral damages to the heirs of the victim, Resty Arimbuyutan. However, the amount of P100,000 should be reduced to P50,000 in accordance with prevailing jurisprudence.[86] Moral damages is awarded without need of proof other than the death of the victim.[87]

WHEREFORE, the decision of the Regional Trial Court, Branch 29, of Cabanatuan City, in Criminal Case No. 5899-AF, finding appellant Cirilo Magalona GUILTY beyond reasonable doubt of the complex crime of murder with double frustrated murder and double attempted murder and sentencing him to suffer the penalty of death is hereby AFFIRMED with modification. Appellant is ordered to pay the heirs of the victim, Resty Arimbuyutan, civil indemnity in the amount of Fifty Thousand Pesos (P50,000); temperate damages in the amount of Fifteen Thousand Pesos (p15,000) and moral damages in the amount of Fifty Thousand Pesos (p50,000). Appellant is also ordered to pay the spouses Rosendo and Rosario Arimhuyutan actual damages in the amount of Six Thousand Nine Hundred Pesos and Five Centavos (P6,900.05).

CRIM CASES 34

In accordance with Section 25 of Republic Act No. 7659 amending Article 83 of the Revised Penal Code, upon finality of this Decision, let the records of this case be forwarded to the Office of the President for possible exercise of the pardoning power.

Costs de oficio.

SO ORDERED.

CRIM CASES 35

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs.JULIO GUILLEN, defendant-appellant.

Mariano A. Albert for appellant.Office of the Solicitor General Felix Bautista Angelo and Solicitor Francisco A. Carreon for appellee.

PER CURIAM, J.:

This case is before us for review of, and by virtue of appeal from, the judgment rendered by the Court of First Instance of Manila in case No. 2746, whereby Julio Guillen y Corpus, or Julio C. Guillen, is found guilty beyond reasonable doubt of the crime of murder and multiple frustrated murder, as charged in the information, and is sentenced to the penalty of death, to indemnify the of the deceased Simeon Valera (or Barrela) in the sum of P2,000 and to pay the costs.

Upon arraignment the accused entered a plea of not guilty to the charges contained in the information.

Then the case was tried in one of the branches of the Court of First Instance of Manila presided over by the honorable Buenaventura Ocampo who, after the submission of the evidence of the prosecution and the defense, rendered judgment as above stated.

In this connection it should be stated that, at the beginning of the trial and before arraignment, counsel de oficio for the accused moved that the mental condition of Guillen be examined. The court, notwithstanding that it had found out from the answers of the accused to questions propounded to him in order to test the soundness of his mind, that he was not suffering from any mental derangement, ordered that Julio Guillen be confined for Hospital, there to be examined by medical experts who should report their findings accordingly. This was done, and, according to the report of the board of medical experts, presided over by Dr. Fernandez of the National Psychopathic Hospital, Julio Guillen was not insane. Said report (Exhibit L), under the heading "Formulation and Diagnosis," at pages 13 and 14, reads:

FORMULATION AND DIAGNOSIS

Julio C. Guillen was placed under constant observation since admission. There was not a single moment during his whole 24 hours daily, that he was not under observation.

The motive behind the commission of the crime is stated above. The veracity of this motivation was determined in the Narcosynthesis. That the narco-synthesis was successful was checked up the day after the test. The narco-synthesis proved not only reveal any conflict or complex that may explain a delusional or hallucinatory motive behind the act.

Our observation and examination failed to elicit any sign or symptom of insanity in Mr. Julio C. Guillen. He was found to be intelligent, always able to differentiate right from wrong, fully aware of the nature of the crime he committed and is equally decided to suffer for it in any manner or form.

His version of the circumstances of the crime, his conduct and conversation relative thereto, the motives, temptations and provocations that preceded the act, were all those of an individual with a sound mind.

On the other hand he is an man of strong will and conviction and once arriving at a decision he executes, irrespective of consequences and as in this case, the commission of the act at Plaza Miranda.

What is of some interest in the personality of Julio C. Guillen is his commission of some overt acts. This is seen not only in the present instance, but sometime when an employee in la Clementina Cigar Factory he engaged in a boxing bout Mr. Manzano, a Span-wanted to abuse the women cigar makers, and felt it his duty to defend them. One time he ran after a policeman with a knife in hand after being provoked to a fight several times. He even challenged Congressman Nueno to a fight sometime before when Mr. Nueno was running for a seat in the Municipal Board of the City of Manila, after hearing him deliver one of his apparently outspoken speeches.

All these mean a defect in his personality characterized by a weakness of censorship especially in relation to rationalization about the consequences of his acts.

In view of the above findings it is our considered opinion that Julio C. Guillen is not insane but is an individual with a personality defect which in Psychiatry is termed, Constitutional Psychopathic Inferiority.

Final Diagnosis

Not insane: Constitutional Psychopathic Inferiority, without psychosis.

In view of the above-quoted findings of the medical board, and notwithstanding the contrary opinion of one Dr. Alvarez, who was asked by the defense to give his opinion on the matter, the court ruled that Guillen, not being insane, could be tired, as he was tired, for the offenses he committed on the date in question.

THE FACTS

Upon careful perusal of the evidence and the briefs submitted by counsel for the accused, the Solicitor General and their respective memoranda, we find that there is no disagreement between the prosecution and the defense, as to the essential facts which caused the filing of the present criminal case against this accused. Those facts may be stated as follows:

On the dates mentioned in this decision, Julio Guillen y Corpus, although not affirmed with any particular political group, has voted for the defeated candidate in the presidential elections held in 1946. Manuel A. Roxas, the successful candidate, assumed the office of President of the Commonwealth and subsequently President of the President of the Philippine Republic. According to Guillen, he became disappointed in President Roxas for his alleged failure to redeem the pledges and fulfill the promises made by him during the presidential election campaign; and his disappointment was aggravated when, according to him, President Roxas, instead of looking after the interest of his country,

CRIM CASES 36

sponsored and campaigned for the approval of the so-called "parity" measure. Hence he determined to assassinate the President.

After he had pondered for some time over the ways and means of assassinating President Roxas, the opportunity presented itself on the night of March 10, 1947, when at a popular meeting held by the Liberal Party at Plaza de Miranda, Quiapo, Manila attended by a big crowd, President Roxas, accompanied by his wife and daughter and surrounded by a number of ladies and gentlemen prominent in government and politics, stood on a platform erected for that purpose and delivered his speech expounding and trying to convince his thousand of listeners of the advantages to be gained by the Philippines, should the constitutional amendment granting American citizens the same rights granted to Filipino nationals be adopted.

Guillen had first intended to use a revolver for the accomplishment of his purpose, but having lost said firearm, which was duly licensed, he thought of two hand grenades which were given him by an American soldier in the early days of the liberation of Manila in exchange for two bottles of whisky. He had likewise been weighing the chances of killing President Roxas, either by going to Malacañan, or following his intended victim in the latter's trips to provinces, for instance, to Tayabas (now Quezon) where the President was scheduled to speak, but having encountered many difficulties, he decided to carry out his plan at the pro-parity meeting held at Plaza de Miranda on the night of March 10, 1947.

On the morning of that he went to the house of Amando Hernandez whom he requested to prepare for him a document (Exhibit B), in accordance with their pervious understanding in the preceding afternoon, when they met at the premises of the Manila Jockey Club on the occasion of an "anti-parity" meeting held there. On account of its materially in this case, we deem it proper to quote hereunder the contents of said document. An English translation (Exhibit B-2) from its original Tagalog reads:

FOR THE SAKE OF A FREE PHILIPPINES

I am the only one responsible for what happened. I conceived it, I planned it, and I carried it out all by myself alone. It took me many days and nights pondering over this act, talking to my own conscience, to my God, until I reached my conclusion. It was my duty.

I did not expected to live long; I only had on life to spare. And had I expected to lives to spare, I would not have hesitated either ton sacrifice it for the sake of a principle which was the welfare of the people.

Thousands have died in Bataan; many more have mourned the loss of their husbands, of their sons, and there are millions now suffering. Their deeds bore no fruits; their hopes were frustrated.

I was told by my conscience and by my God that there was a man to be blamed for all this: he had deceived the people, he had astounded them with no other purpose than to entice them; he even went to the extent of risking the heritage of our future generations. For these reasons he should not continue any longer. His life would mean nothing as compared with the welfare of eighteen million souls. And why should I not give up my life too if only the good of those eighteen million souls.

These are the reasons which impelled me to do what I did and I am willing to bear up the consequences of my act. I t matters not if others will curse me. Time and history will show, I am sure, that I have only displayed a high degree of patriotism in my performance of my said act.

Hurrah for a free Philippines.

Cheers for the happiness of every Filipino home.

May God pity on me.

Amen.

JULIO C. GUILLEN

A copy (Exhibit B-1) of the original in Tagalog (Exhibit B), made at the request of Guillen by his nephew, was handed to him only at about 6 o'clock in the afternoon of March 10, 1947, for which reason said Exhibit B-1 appears unsigned, because he was in a hurry for that meeting at Plaza de Miranda.

When he reached Plaza de Miranda, Guillen was carrying two hand grenades concealed in a paper bag which also contained peanuts. He buried one of the hand grenades (Exhibit D), in a plant pot located close to the platform, and when he decided to carry out his evil purpose he stood on the chair on which he had been sitting and, from a distance of about seven meters, he hurled the grenade at the President when the latter had just closed his speech, was being congratulated by Ambassador Romulo and was about to leave the platform.

General Castañeda, who was on the platform, saw the smoking, hissing, grenade and without losing his presence of mind, kicked it away from the platform, along the stairway, and towards an open space where the general thought the grenade was likely to do the least harm; and, covering the President with his body, shouted to the crowd that everybody should lie down. The grenade fell to the ground and exploded in the middle of a group of persons who were standing close to the platform. Confusion ensued, and the crowd dispersed in a panic. It was found that the fragments of the grenade had seriously injured Simeon Varela (or Barrela ) — who died on the following day as the result of mortal wounds caused by the fragments of the grenade (Exhibits F and F-1) — Alfredo Eva, Jose Fabio, Pedro Carrillo and Emilio Maglalang.

Guillen was arrested by members of the Police Department about two hours after the occurrence. It appears that one Angel Garcia, who was one spectators at that meeting, saw how a person who was standing next to him hurled an object at the platform and, after the explosion, ran away towards a barber shop located near the platform at Plaza de Miranda. Suspecting that person was the thrower of the object that exploded, Garcia went after him and had almost succeeded in holding him, but Guillen offered stiff resistance, got loose from Garcia and managed to escape. Garcia pursued him, but some detectives, mistaking the former for the real criminal and the author of the explosion, placed him under arrest. In the meantime, while the City Mayor and some agents of the Manila Police Department were investigating the affair, one Manuel Robles volunteered the information that the person with whom Angel Garcia was wrestling was Julio Guillen; that he (Manuel Robles) was acquainted with Julio

CRIM CASES 37

Guillen for the previous ten years and had seen each other in the plaza a few moments previous to the explosion.

The police operatives interrogated Garcia and Robles, and Julio Guillen was, within two hours after the occurrence, found in his home at 1724 Juan Luna Street, Manila, brought to the police headquarters and identified by Angel Garcia, as the same person who hurled towards the platform the object which exploded and whom Garcia tried to hold when he was running away.

During the investigation conducted by the police he readily admitted his responsibility, although at the same time he tried to justify his action in throwing the bomb at President Roxas. He also indicated to his captors the place where he had hidden his so called last will quoted above and marked Exhibit B, which was then unsigned by him and subsequently signed at the police headquarters.

Re-enacting the crime (Exhibit C), he pointed out to the police where he had buried (Exhibit C-1) the other hand grenade (Exhibit D), and, in the presence of witnesses he signed a statement which contained his answers to question propounded to him by Major A. Quintos of the Manila Police, who investigated him soon after his arrest (Exhibit E). From a perusal of his voluntary statement, we are satisfied that it tallies exactly with the declarations and made by him on the witness stand during the trial of this case.

THE ISSUES

In the brief submitted by counsel de oficio for this appellant, several errors are assigned allegedly committed by the trial court, namely: first, "in finding the appellant guilty of murder for the death of Simeon Varela"; second, "in declaring the appellant guilty of the complex crime of murder and multiple frustrated murder"; third, "in applying sub-section 1 of article 49 of the Revised Penal Code in determining the penalty to be imposed upon the accused"; and fourth, "in considering the concurrence of the aggravating circumstances of nocturnity and of contempt of public authorities in the commission of crime."

The evidence for the prosecution, supported by the brazen statements made by the accused, shows beyond any shadow of doubt that, when Guillen attended that meeting, carrying with him two hand grenades, to put into execution his preconceived plan to assassinate President Roxas, he knew fully well that, by throwing one of those two hand grenades in his possession at President Roxas, and causing it to explode, he could not prevent the persons who were around his main and intended victim from being killed or at least injured, due to the highly explosive nature of the bomb employed by him to carry out his evil purpose.

Guillen, testifying in his own behalf, in answer to questions propounded by the trial judge (page 96 of transcript) supports our conclusion. He stated that he performed the act voluntarily; that his purpose was to kill the President, but that it did not make any difference to him if there were some people around the President when he hurled that bomb, because the killing of those who surrounded the President was tantamount to killing the President, in view of the fact that those persons, being loyal to the President being loyal to the President, were identified with the latter. In other word, although it was not his main intention to kill the persons surrounding the President, he felt no conjunction in killing them also in order to attain his main purpose of killing the President.

The facts do not support the contention of counsel for appellant that the latter is guilty only of homicide through reckless imprudence in regard to the death of Simeon Varela and of less serious physical injuries in regard to Alfredo Eva, Jose Fabio, Pedro Carrillo and Emilio Maglalang, and that he should be sentenced to the corresponding penalties for the different felonies committed, the sum total of which shall not exceed three times the penalty to be imposed for the most serious crime in accordance with article 70 in relation to article 74 of the Revised Penal Code.

In throwing hand grenade at the President with the intention of killing him, the appellant acted with malice. He is therefore liable for all the consequences of his wrongful act; for in accordance with article 4 of the Revised Penal Code, criminal liability is incurred by any person committing felony (delito) although the wrongful act done be different from that which he intended. In criminal negligence, the injury caused to another should be unintentional, it being simply the incident of another act performed without malice. (People vs. Sara, 55 Phil., 939.) In the words of Viada, "in order that an act may be qualified as imprudence it is necessary that either malice nor intention to cause injury should intervene; where such intention exists, the act should qualified by the felony it has produced even though it may not have been the intention of the actor to cause an evil of such gravity as that produced.' (Viada's Comments on the Penal Code, vol. 7, 5th ed., p.7.) And, as held by this Court, a deliberate intent to do an unlawful act is essentially inconsistent with the idea of reckless imprudence. (People vs. Nanquil, 43 Phil., 232.) Where such unlawful act is wilfully done, a mistake in the identity of the intended victim cannot be considered as reckless imprudence. (People vs. Gona, 54 Phil., 605)

Squarely on the point by counsel is the following decision of the Supreme Court of Spain:

Cuestion 62. Se presenta A, a las ocho de la noche, en el estanco de B a comprar tabaco, y habiendose negado este a darselo al fiado, se retira a quel sin mediar entre ambos disputa alguna; pero; trnscurrido un cuarto de hora, hallandose el estanquero despachando a C, se oye la detonacion de un arma de fuego disparada por A desde la calle, quedando muertos en el acto C y el estanquero; supuesta la no intencion en A de matar a C y si solo al estanquero, cabe calificar la muerte de este de homicidio y la de c de imprudencia temeraria? — La Sala de lo Criminal de la Auudiencia de Granada lo estimo asi, y condeno al procesado a catorse anos de reclusion por el homivcidio y a un año de prision correctional por la imprudencia. Aparte de que la muerte del estanquero debio calificarse de assesinato y no de homicidio, por haberse ejecutado con aleviosa. es evidente que la muerte de C, suponiendo que no se propusiera ejecutaria el procesado, no pudo calificarse de imprudencia teme raria, sino que tambien debio declararsele responsable de la misma, a tenor de lo puesto en este apartado ultimo del articulo; y que siendo ambas muertes producidas por un solo hecho, o sea por un solo disparo, debio imponerse al reo la pena del delito de asesinato en el grado maximo, a tenor de lo dispuesto en el art. 90 del Codigo, o sea la pena de muerte. Se ve, pues, claramente que en el antedicha sentencia, aparte de otros articulos del Codigo, se infringio por la Sala la disposicion de este apartado ultimo del articulo muy principalmente, y asi lo declaro el Tribunal Supremo en S. de 18 junio de 1872. (Gaceta de 1,0 de agosto.) (I Viada, 5th Ed., p. 42.)

Article 48 of the Revised Penal Code provides as follows:

CRIM CASES 38

Art. 48. Penalty for Complex Crimes. — When a single act constitutes two or more grave or less grave felonies, or when an offense is a necessary means for committing the other, the penalty for the most serious crime shall be imposed, the same to be applied in its maximum period.

We think it is the above-quoted article and not paragraph 1 of article 49 that is applicable. The case before us is clearly governed by the first clause of article 48 because by a single act, that a throwing highly explosive hand grenade at President Roxas, the accused committed two grave felonies, namely: (1) murder, of which Simeon Varela was the victim; and (2) multiple attempted murder, of which President Roxas, Alfredo Eva, Jose Fabio, Pedro Carrillo and Emilio Maglalang were the injured parties.

The killing of Simeon Varela was attended by the qualifying circumstance of treachery. In the case of People vs. Mabug-at, supra, this court held that the qualifying circumstance of treachery may be properly considered, even when the victim of the attack was not the one whom the defendant intended to kill, if it appears from the evidence that neither of the two persons could in any manner put up defense against the attack, or become aware of it. In the same case it was held that the qualifying circumstance of premeditation may not be properly taken into the account when the person whom the defendant proposed to kill was different from the one who became his victim.

There can be no question that the accused attempted to kill President Roxas by throwing a hand grenade at him with the intention to kill him, thereby commencing the commission of a felony by over acts, but he did not succeed in assassinating him "by reason of some cause or accident other than his own spontaneous desistance." For the same reason we qualify the injuries caused on the four other persons already named as merely attempted and not frustrated murder.

In this connection, it should be stated that , although there is abundant proof that , in violation of the provisions of article 148 of the Revised Penal Code, the accused Guillen has committed among others the offense of assault upon a person in authority, for in fact his efforts were directed towards the execution of his main purpose of eliminating President Roxas for his failure to redeem his electoral campaign promises, by throwing at him in his official capacity as the Chief Executive of the nation the hand grenade in question, yet, in view of the appropriate allegation charging Guillen with the commission of said offense, we shall refrain making a finding to that effect.

The complex crimes of murder and multiple attempted murder committed by the accused with the single act of throwing a hand grenade at the President, was attended by the various aggravating circumstances alleged in the information, without any mitigating circumstance. But we do not deem it necessary to consider said aggravating circumstances because in any event article 48 of the Revised Penal Code above-quoted requires that the penalty for the most serious of said crimes be applied in its maximum period. The penalty for murder is reclusion temporal in its maximum period to death. (Art. 248.)

It is our painful duty to apply the law and mete out to the accused the extreme penalty provided by it upon the facts and circumstances hereinabove narrated.

The sentence of the trial court being correct, we have no alternative but to affirm it, and we hereby do so by a unanimous vote. The death sentence shall be executed in accordance with article 81 of the

Revised Penal Code, under authority of the Director of Prisons, on such working day as the trial court may fix within 30 days from the date the record shall have been remanded. It is so ordered.

CRIM CASES 39

FILOMENO URBANO, petitioner, vs.HON. INTERMEDIATE APPELLATE COURT AND PEOPLE OF THE PHILIPPINES, respondents.

GUTIERREZ, JR., J.:

This is a petition to review the decision of the then Intermediate Appellate Court which affirmed the decision of the then Circuit Criminal Court of Dagupan City finding petitioner Filomeno Urban guilty beyond reasonable doubt of the crime of homicide.

The records disclose the following facts of the case.

At about 8:00 o'clock in the morning of October 23, 1980, petitioner Filomeno Urbano went to his ricefield at Barangay Anonang, San Fabian, Pangasinan located at about 100 meters from the tobacco seedbed of Marcelo Javier. He found the place where he stored his palay flooded with water coming from the irrigation canal nearby which had overflowed. Urbano went to the elevated portion of the canal to see what happened and there he saw Marcelo Javier and Emilio Erfe cutting grass. He asked them who was responsible for the opening of the irrigation canal and Javier admitted that he was the one. Urbano then got angry and demanded that Javier pay for his soaked palay. A quarrel between them ensued. Urbano unsheathed his bolo (about 2 feet long, including the handle, by 2 inches wide) and hacked Javier hitting him on the right palm of his hand, which was used in parrying the bolo hack. Javier who was then unarmed ran away from Urbano but was overtaken by Urbano who hacked him again hitting Javier on the left leg with the back portion of said bolo, causing a swelling on said leg. When Urbano tried to hack and inflict further injury, his daughter embraced and prevented him from hacking Javier.

Immediately thereafter, Antonio Erfe, Emilio Erfe, and Felipe Erfe brought Javier to his house about 50 meters away from where the incident happened. Emilio then went to the house of Barangay Captain Menardo Soliven but not finding him there, Emilio looked for barrio councilman Felipe Solis instead. Upon the advice of Solis, the Erfes together with Javier went to the police station of San Fabian to report the incident. As suggested by Corporal Torio, Javier was brought to a physician. The group went to Dr. Guillermo Padilla, rural health physician of San Fabian, who did not attend to Javier but instead suggested that they go to Dr. Mario Meneses because Padilla had no available medicine.

After Javier was treated by Dr. Meneses, he and his companions returned to Dr. Guillermo Padilla who conducted a medico-legal examination. Dr. Padilla issued a medico-legal certificate (Exhibit "C" dated September 28, 1981) which reads:

TO WHOM IT MAY CONCERN:

This is to certify that I have examined the wound of Marcelo Javier, 20 years of age, married, residing at Barangay Anonang, San Fabian, Pangasinan on October 23, 1980 and found the following:

1 -Incised wound 2 inches in length at the upper portion of the lesser palmar prominence, right.

As to my observation the incapacitation is from (7-9) days period. This wound was presented to me only for medico-legal examination, as it was already treated by the other doctor. (p. 88, Original Records)

Upon the intercession of Councilman Solis, Urbano and Javier agreed to settle their differences. Urbano promised to pay P700.00 for the medical expenses of Javier. Hence, on October 27, 1980, the two accompanied by Solis appeared before the San Fabian Police to formalize their amicable settlement. Patrolman Torio recorded the event in the police blotter (Exhibit A), to wit:

xxx xxx xxx

Entry Nr 599/27 Oct '80/103OH/ Re entry Nr 592 on page 257 both parties appeared before this Station accompanied by brgy. councilman Felipe Solis and settled their case amicably, for they are neighbors and close relatives to each other. Marcelo Javier accepted and granted forgiveness to Filomeno Urbano who shoulder (sic) all the expenses in his medical treatment, and promising to him and to this Office that this will never be repeated anymore and not to harbour any grudge against each other. (p. 87, Original Records.)

Urbano advanced P400.00 to Javier at the police station. On November 3, 1980, the additional P300.00 was given to Javier at Urbano's house in the presence of barangay captain Soliven.

At about 1:30 a.m. on November 14, 1980, Javier was rushed to the Nazareth General Hospital in a very serious condition. When admitted to the hospital, Javier had lockjaw and was having convulsions. Dr. Edmundo Exconde who personally attended to Javier found that the latter's serious condition was caused by tetanus toxin. He noticed the presence of a healing wound in Javier's palm which could have been infected by tetanus.

On November 15, 1980 at exactly 4:18 p.m., Javier died in the hospital. The medical findings of Dr. Exconde are as follows:

Date Diagnosis

11-14-80 ADMITTED due to trismus

adm. at DX TETANUS

1:30 AM Still having frequent muscle spasm. With diffi-

#35, 421 culty opening his mouth. Restless at times. Febrile

11-15-80 Referred. Novaldin 1 amp. inj. IM. Sudden cessa-

tion of respiration and HR after muscular spasm.

02 inhalation administered. Ambo bag resuscita-

CRIM CASES 40

tion and cardiac massage done but to no avail.

Pronounced dead by Dra. Cabugao at 4:18 P.M.

PMC done and cadaver brought home by rela-

tives. (p. 100, Original Records)

In an information dated April 10, 1981, Filomeno Urbano was charged with the crime of homicide before the then Circuit Criminal Court of Dagupan City, Third Judicial District.

Upon arraignment, Urbano pleaded "not guilty." After trial, the trial court found Urbano guilty as charged. He was sentenced to suffer an indeterminate prison term of from TWELVE (12) YEARS of prision mayor, as minimum to SEVENTEEN (17) years, FOUR (4) MONTHS and ONE (1) DAY of reclusion temporal, as maximum, together with the accessories of the law, to indemnify the heirs of the victim, Marcelo Javier, in the amount of P12,000.00 without subsidiary imprisonment in case of insolvency, and to pay the costs. He was ordered confined at the New Bilibid Prison, in Muntinlupa, Rizal upon finality of the decision, in view of the nature of his penalty.

The then Intermediate Appellate Court affirmed the conviction of Urbano on appeal but raised the award of indemnity to the heirs of the deceased to P30,000.00 with costs against the appellant.

The appellant filed a motion for reconsideration and/or new trial. The motion for new trial was based on an affidavit of Barangay Captain Menardo Soliven (Annex "A") which states:

That in 1980, I was the barrio captain of Barrio Anonang, San Fabian, Pangasinan, and up to the present having been re-elected to such position in the last barangay elections on May 17, 1982;

That sometime in the first week of November, 1980, there was a typhoon that swept Pangasinan and other places of Central Luzon including San Fabian, a town of said province;

That during the typhoon, the sluice or control gates of the Bued irrigation dam which irrigates the ricefields of San Fabian were closed and/or controlled so much so that water and its flow to the canals and ditches were regulated and reduced;

That due to the locking of the sluice or control gates of the dam leading to the canals and ditches which will bring water to the ricefields, the water in said canals and ditches became shallow which was suitable for catching mudfishes;

That after the storm, I conducted a personal survey in the area affected, with my secretary Perfecto Jaravata;

That on November 5, 1980, while I was conducting survey, I saw the late Marcelo Javier catching fish in the shallow irrigation canals with some companions;

That few days there after,or on November l5, l980, I came to know that said Marcelo Javier died of tetanus. (p. 33, Rollo)

The motion was denied. Hence, this petition.

In a resolution dated July 16, 1986, we gave due course to the petition.

The case involves the application of Article 4 of the Revised Penal Code which provides that "Criminal liability shall be incurred: (1) By any person committing a felony (delito) although the wrongful act done be different from that which he intended ..." Pursuant to this provision "an accused is criminally responsible for acts committed by him in violation of law and for all the natural and logical consequences resulting therefrom." (People v. Cardenas, 56 SCRA 631).

The record is clear that Marcelo Javier was hacked by the petitioner who used a bolo as a result of which Javier suffered a 2-inch incised wound on his right palm; that on November 14, 1981 which was the 22nd day after the incident, Javier was rushed to the hospital in a very serious condition and that on the following day, November 15, 1981, he died from tetanus.

Under these circumstances, the lower courts ruled that Javier's death was the natural and logical consequence of Urbano's unlawful act. Hence, he was declared responsible for Javier's death. Thus, the appellate court said:

The claim of appellant that there was an efficient cause which supervened from the time the deceased was wounded to the time of his death, which covers a period of 23 days does not deserve serious consideration. True, that the deceased did not die right away from his wound, but the cause of his death was due to said wound which was inflicted by the appellant. Said wound which was in the process of healing got infected with tetanus which ultimately caused his death.

Dr. Edmundo Exconde of the Nazareth General Hospital testified that the victim suffered lockjaw because of the infection of the wound with tetanus. And there is no other way by which he could be infected with tetanus except through the wound in his palm (tsn., p. 78, Oct. 5, 1981). Consequently, the proximate cause of the victim's death was the wound which got infected with tetanus. And the settled rule in this jurisdiction is that an accused is liable for all the consequences of his unlawful act. (Article 4, par. 1, R.P.C. People v. Red, CA 43 O.G. 5072; People v. Cornel 78 Phil. 418).

Appellant's allegation that the proximate cause of the victim's death was due to his own negligence in going back to work without his wound being properly healed, and lately, that he went to catch fish in dirty irrigation canals in the first week of November, 1980, is an afterthought, and a desperate attempt by appellant to wiggle out of the predicament he found himself in. If the wound had not yet healed, it is impossible to conceive that the deceased would be reckless enough to work with a disabled hand. (pp. 20-21, Rollo)

The petitioner reiterates his position that the proximate cause of the death of Marcelo Javier was due to his own negligence, that Dr. Mario Meneses found no tetanus in the injury, and that Javier got infected with tetanus when after two weeks he returned to his farm and tended his tobacco plants with his bare hands exposing the wound to harmful elements like tetanus germs.

CRIM CASES 41

The evidence on record does not clearly show that the wound inflicted by Urbano was infected with tetanus at the time of the infliction of the wound. The evidence merely confirms that the wound, which was already healing at the time Javier suffered the symptoms of the fatal ailment, somehow got infected with tetanus However, as to when the wound was infected is not clear from the record.

In Vda. de Bataclan, et al. v. Medina (102 Phil. 1181), we adopted the following definition of proximate cause:

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... A satisfactory definition of proximate cause is found in Volume 38, pages 695-696 of American Jurisprudence, cited by plaintiffs-appellants in their brief. It is as follows:

... "that cause, which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury, and without which the result would not have occurred."And more comprehensively, "the proximate legal cause is that acting first and producing the injury, either immediately or by setting other events in motion, all constituting a natural and continuous chain of events, each having a close causal connection with its immediate predecessor, the final event in the chain immediately effecting the injury as a natural and probable result of the cause which first acted, under such circumstances that the person responsible for the first event should, as an ordinarily prudent and intelligent person, have reasonable ground to expect at the moment of his act or default that an injury to some person might probably result therefrom." (at pp. 185-186)

The issue, therefore, hinges on whether or not there was an efficient intervening cause from the time Javier was wounded until his death which would exculpate Urbano from any liability for Javier's death.

We look into the nature of tetanus-

The incubation period of tetanus, i.e., the time between injury and the appearance of unmistakable symptoms, ranges from 2 to 56 days. However, over 80 percent of patients become symptomatic within 14 days. A short incubation period indicates severe disease, and when symptoms occur within 2 or 3 days of injury the mortality rate approaches 100 percent.

Non-specific premonitory symptoms such as restlessness, irritability, and headache are encountered occasionally, but the commonest presenting complaints are pain and stiffness in the jaw, abdomen, or back and difficulty swallowing. As the progresses, stiffness gives way to rigidity, and patients often complain of difficulty opening their mouths. In fact, trismus in the commonest manifestation of tetanus and is responsible for the familiar descriptive name of lockjaw. As more muscles are involved, rigidity becomes generalized, and sustained contractions called risus sardonicus. The intensity and sequence of muscle involvement is quite variable. In a small proportion of patients, only local signs and symptoms develop in the region of the injury. In the vast majority, however, most muscles are involved to some degree, and the signs and symptoms encountered depend upon the major muscle groups affected.

Reflex spasm usually occur within 24 to 72 hours of the first symptom, an interval referred to as the onset time. As in the case of the incubation period, a short onset time is associated with a poor

prognosis. Spasms are caused by sudden intensification of afferent stimuli arising in the periphery, which increases rigidity and causes simultaneous and excessive contraction of muscles and their antagonists. Spasms may be both painful and dangerous. As the disease progresses, minimal or inapparent stimuli produce more intense and longer lasting spasms with increasing frequency. Respiration may be impaired by laryngospasm or tonic contraction of respiratory muscles which prevent adequate ventilation. Hypoxia may then lead to irreversible central nervous system damage and death.

Mild tetanus is characterized by an incubation period of at least 14 days and an onset time of more than 6 days. Trismus is usually present, but dysphagia is absent and generalized spasms are brief and mild. Moderately severe tetanus has a somewhat shorter incubation period and onset time; trismus is marked, dysphagia and generalized rigidity are present, but ventilation remains adequate even during spasms. The criteria for severe tetanus include a short incubation time, and an onset time of 72 hrs., or less, severe trismus, dysphagia and rigidity and frequent prolonged, generalized convulsive spasms. (Harrison's Principle of Internal Medicine, 1983 Edition, pp. 1004-1005; Emphasis supplied)

Therefore, medically speaking, the reaction to tetanus found inside a man's body depends on the incubation period of the disease.

In the case at bar, Javier suffered a 2-inch incised wound on his right palm when he parried the bolo which Urbano used in hacking him. This incident took place on October 23, 1980. After 22 days, or on November 14, 1980, he suffered the symptoms of tetanus, like lockjaw and muscle spasms. The following day, November 15, 1980, he died.

If, therefore, the wound of Javier inflicted by the appellant was already infected by tetanus germs at the time, it is more medically probable that Javier should have been infected with only a mild cause of tetanus because the symptoms of tetanus appeared on the 22nd day after the hacking incident or more than 14 days after the infliction of the wound. Therefore, the onset time should have been more than six days. Javier, however, died on the second day from the onset time. The more credible conclusion is that at the time Javier's wound was inflicted by the appellant, the severe form of tetanus that killed him was not yet present. Consequently, Javier's wound could have been infected with tetanus after the hacking incident. Considering the circumstance surrounding Javier's death, his wound could have been infected by tetanus 2 or 3 or a few but not 20 to 22 days before he died.

The rule is that the death of the victim must be the direct, natural, and logical consequence of the wounds inflicted upon him by the accused. (People v. Cardenas, supra) And since we are dealing with a criminal conviction, the proof that the accused caused the victim's death must convince a rational mind beyond reasonable doubt. The medical findings, however, lead us to a distinct possibility that the infection of the wound by tetanus was an efficient intervening cause later or between the time Javier was wounded to the time of his death. The infection was, therefore, distinct and foreign to the crime. (People v. Rellin, 77 Phil. 1038).

Doubts are present. There is a likelihood that the wound was but the remote cause and its subsequent infection, for failure to take necessary precautions, with tetanus may have been the proximate cause of Javier's death with which the petitioner had nothing to do. As we ruled in Manila Electric Co. v. Remoquillo, et al. (99 Phil. 118).

CRIM CASES 42

"A prior and remote cause cannot be made the be of an action if such remote cause did nothing more than furnish the condition or give rise to the occasion by which the injury was made possible, if there intervened between such prior or remote cause and the injury a distinct, successive, unrelated, and efficient cause of the injury, even though such injury would not have happened but for such condition or occasion. If no danger existed in the condition except because of the independent cause, such condition was not the proximate cause. And if an independent negligent act or defective condition sets into operation the instances which result in injury because of the prior defective condition, such subsequent act or condition is the proximate cause." (45 C.J. pp. 931-932). (at p. 125)

It strains the judicial mind to allow a clear aggressor to go scot free of criminal liability. At the very least, the records show he is guilty of inflicting slight physical injuries. However, the petitioner's criminal liability in this respect was wiped out by the victim's own act. After the hacking incident, Urbano and Javier used the facilities of barangay mediators to effect a compromise agreement where Javier forgave Urbano while Urbano defrayed the medical expenses of Javier. This settlement of minor offenses is allowed under the express provisions of Presidential Decree G.R. No. 1508, Section 2(3). (See also People v. Caruncho, 127 SCRA 16).

We must stress, however, that our discussion of proximate cause and remote cause is limited to the criminal aspects of this rather unusual case. It does not necessarily follow that the petitioner is also free of civil liability. The well-settled doctrine is that a person, while not criminally liable, may still be civilly liable. Thus, in the recent case of People v. Rogelio Ligon y Tria, et al. (G.R. No. 74041, July 29, 1987), we said:

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... While the guilt of the accused in a criminal prosecution must be established beyond reasonable doubt, only a preponderance of evidence is required in a civil action for damages. (Article 29, Civil Code). The judgment of acquittal extinguishes the civil liability of the accused only when it includes a declaration that the facts from which the civil liability might arise did not exist. (Padilla v. Court of Appeals, 129 SCRA 559).

The reason for the provisions of article 29 of the Civil Code, which provides that the acquittal of the accused on the ground that his guilt has not been proved beyond reasonable doubt does not necessarily exempt him from civil liability for the same act or omission, has been explained by the Code Commission as follows:

The old rule that the acquittal of the accused in a criminal case also releases him from civil liability is one of the most serious flaws in the Philippine legal system. It has given use to numberless instances of miscarriage of justice, where the acquittal was due to a reasonable doubt in the mind of the court as to the guilt of the accused. The reasoning followed is that inasmuch as the civil responsibility is derived from the criminal offense, when the latter is not proved, civil liability cannot be demanded.

This is one of those causes where confused thinking leads to unfortunate and deplorable consequences. Such reasoning fails to draw a clear line of demarcation between criminal liability and civil responsibility, and to determine the logical result of the distinction. The two liabilities are separate and

distinct from each other. One affects the social order and the other, private rights. One is for the punishment or correction of the offender while the other is for reparation of damages suffered by the aggrieved party. The two responsibilities are so different from each other that article 1813 of the present (Spanish) Civil Code reads thus: "There may be a compromise upon the civil action arising from a crime; but the public action for the imposition of the legal penalty shall not thereby be extinguished." It is just and proper that, for the purposes of the imprisonment of or fine upon the accused, the offense should be proved beyond reasonable doubt. But for the purpose of indemnity the complaining party, why should the offense also be proved beyond reasonable doubt? Is not the invasion or violation of every private right to be proved only by a preponderance of evidence? Is the right of the aggrieved person any less private because the wrongful act is also punishable by the criminal law?

"For these reasons, the Commission recommends the adoption of the reform under discussion. It will correct a serious defect in our law. It will close up an inexhaustible source of injustice-a cause for disillusionment on the part of the innumerable persons injured or wronged."

The respondent court increased the P12,000.00 indemnification imposed by the trial court to P30,000.00. However, since the indemnification was based solely on the finding of guilt beyond reasonable doubt in the homicide case, the civil liability of the petitioner was not thoroughly examined. This aspect of the case calls for fuller development if the heirs of the victim are so minded.

WHEREFORE, the instant petition is hereby GRANTED. The questioned decision of the then Intermediate Appellate Court, now Court of Appeals, is REVERSED and SET ASIDE. The petitioner is ACQUITTED of the crime of homicide. Costs de oficio.

SO ORDERED.

Fernan, (Chairman), Feliciano, Bidin and,Cortes, JJ., concur.

CRIM CASES 43

G.R. No. 103119 October 21, 1992

SULPICIO INTOD, petitioner, vs.HONORABLE COURT OF APPEALS and PEOPLE OF THE PHILIPPINES, respondents.

CAMPOS, JR., J.:

Petitioner, Sulpicio Intod, filed this petition for review of the decision of the Court of Appeals 1 affirming in toto the judgment of the Regional Trial Court, Branch XIV, Oroquieta City, finding him guilty of the crime of attempted murder.

From the records, we gathered the following facts.

In the morning of February 4, 1979, Sulpicio Intod, Jorge Pangasian, Santos Tubio and Avelino Daligdig went to Salvador Mandaya's house in Katugasan, Lopez Jaena, Misamis Occidental and asked him to go with them to the house of Bernardina Palangpangan. Thereafter, Mandaya and Intod, Pangasian, Tubio and Daligdig had a meeting with Aniceto Dumalagan. He told Mandaya that he wanted Palangpangan to be killed because of a land dispute between them and that Mandaya should accompany the four (4) men, otherwise, he would also be killed.

At about 10:00 o'clock in the evening of the same day, Petitioner, Mandaya, Pangasian, Tubio and Daligdig, all armed with firearms, arrived at Palangpangan's house in Katugasan, Lopez Jaena, Misamis Occidental. At the instance of his companions, Mandaya pointed the location of Palangpangan's bedroom. Thereafter, Petitioner, Pangasian, Tubio and Daligdig fired at said room. It turned out, however, that Palangpangan was in another City and her home was then occupied by her son-in-law and his family. No one was in the room when the accused fired the shots. No one was hit by the gun fire.

Petitioner and his companions were positively identified by witnesses. One witness testified that before the five men left the premises, they shouted: "We will kill you (the witness) and especially Bernardina Palangpangan and we will come back if (sic) you were not injured". 2

After trial, the Regional Trial Court convicted Intod of attempted murder. The court (RTC), as affirmed by the Court of Appeals, holding that Petitioner was guilty of attempted murder. Petitioner seeks from this Court a modification of the judgment by holding him liable only for an impossible crime, citing Article 4(2) of the Revised Penal Code which provides:

Art. 4(2). CRIMINAL RESPONSIBILITY. — Criminal Responsibility shall be incurred:

xxx xxx xxx

2. By any person performing an act which would be an offense against persons or property, were it not for the inherent impossibility of its accomplishment or on account of the employment of inadequate or ineffectual means.

Petitioner contends that, Palangpangan's absence from her room on the night he and his companions riddled it with bullets made the crime inherently impossible.

On the other hand, Respondent People of the Philippines argues that the crime was not impossible. Instead, the facts were sufficient to constitute an attempt and to convict Intod for attempted murder. Respondent alleged that there was intent. Further, in its Comment to the Petition, respondent pointed out that:

. . . The crime of murder was not consummated, not because of the inherent impossibility of its accomplishment (Art. 4(2), Revised Penal Code), but due to a cause or accident other than petitioner's and his accused's own spontaneous desistance (Art. 3., Ibid.) Palangpangan did not sleep at her house at that time. Had it not been for this fact, the crime is possible, not impossible. 3

Article 4, paragraph 2 is an innovation 4 of the Revised Penal Code. This seeks to remedy the void in the Old Penal Code where:

. . . it was necessary that the execution of the act has been commenced, that the person conceiving the idea should have set about doing the deed, employing appropriate means in order that his intent might become a reality, and finally, that the result or end contemplated shall have been physically possible. So long as these conditions were not present, the law and the courts did not hold him criminally liable. 5

This legal doctrine left social interests entirely unprotected. 6 The Revised Penal Code, inspired by the Positivist School, recognizes in the offender his formidability, 7 and now penalizes an act which were it not aimed at something quite impossible or carried out with means which prove inadequate, would constitute a felony against person or against property. 8 The rationale of Article 4(2) is to punish such criminal tendencies. 9

Under this article, the act performed by the offender cannot produce an offense against person or property because: (1) the commission of the offense is inherently impossible of accomplishment: or (2) the means employed is either (a) inadequate or (b) ineffectual. 10

That the offense cannot be produced because the commission of the offense is inherently impossible of accomplishment is the focus of this petition. To be impossible under this clause, the act intended by the offender must be by its nature one impossible of accomplishment. 11 There must be either impossibility of accomplishing the intended act 12 in order to qualify the act an impossible crime.

Legal impossibility occurs where the intended acts, even if completed, would not amount to a crime. 13 Thus:

Legal impossibility would apply to those circumstances where (1) the motive, desire and expectation is to perform an act in violation of the law; (2) there is intention to perform the physical act; (3) there is a performance of the intended physical act; and (4) the consequence resulting from the intended act does not amount to a crime. 14

The impossibility of killing a person already dead 15 falls in this category.

CRIM CASES 44

On the other hand, factual impossibility occurs when extraneous circumstances unknown to the actor or beyond his control prevent the consummation of the intended crime. 16 One example is the man who puts his hand in the coat pocket of another with the intention to steal the latter's wallet and finds the pocket empty. 17

The case at bar belongs to this category. Petitioner shoots the place where he thought his victim would be, although in reality, the victim was not present in said place and thus, the petitioner failed to accomplish his end.

One American case had facts almost exactly the same as this one. In People vs. Lee Kong, 18 the accused, with intent to kill, aimed and fired at the spot where he thought the police officer would be. It turned out, however, that the latter was in a different place. The accused failed to hit him and to achieve his intent. The Court convicted the accused of an attempt to kill. It held that:

The fact that the officer was not at the spot where the attacking party imagined where he was, and where the bullet pierced the roof, renders it no less an attempt to kill. It is well settled principle of criminal law in this country that where the criminal result of an attempt is not accomplished simply because of an obstruction in the way of the thing to be operated upon, and these facts are unknown to the aggressor at the time, the criminal attempt is committed.

In the case of Strokes vs. State, 19 where the accused failed to accomplish his intent to kill the victim because the latter did not pass by the place where he was lying-in wait, the court held him liable for attempted murder. The court explained that:

It was no fault of Strokes that the crime was not committed. . . . It only became impossible by reason of the extraneous circumstance that Lane did not go that way; and further, that he was arrested and prevented from committing the murder. This rule of the law has application only where it is inherently impossible to commit the crime. It has no application to a case where it becomes impossible for the crime to be committed, either by outside interference or because of miscalculation as to a supposed opportunity to commit the crime which fails to materialize; in short it has no application to the case when the impossibility grows out of extraneous acts not within the control of the party.

In the case of Clark vs. State, 20 the court held defendant liable for attempted robbery even if there was nothing to rob. In disposing of the case, the court quoted Mr. Justice Bishop, to wit:

It being an accepted truth that defendant deserves punishment by reason of his criminal intent, no one can seriously doubt that the protection of the public requires the punishment to be administered, equally whether in the unseen depths of the pocket, etc., what was supposed to exist was really present or not. The community suffers from the mere alarm of crime. Again: Where the thing intended (attempted) as a crime and what is done is a sort to create alarm, in other words, excite apprehension that the evil; intention will be carried out, the incipient act which the law of attempt takes cognizance of is in reason committed.

In State vs. Mitchell, 21 defendant, with intent to kill, fired at the window of victim's room thinking that the latter was inside. However, at that moment, the victim was in another part of the house. The court convicted the accused of attempted murder.

The aforecited cases are the same cases which have been relied upon by Respondent to make this Court sustain the judgment of attempted murder against Petitioner. However, we cannot rely upon these decisions to resolve the issue at hand. There is a difference between the Philippine and the American laws regarding the concept and appreciation of impossible crimes.

In the Philippines, the Revised Penal Code, in Article 4(2), expressly provided for impossible crimes and made the punishable. Whereas, in the United States, the Code of Crimes and Criminal Procedure is silent regarding this matter. What it provided for were attempts of the crimes enumerated in the said Code. Furthermore, in said jurisdiction, the impossibility of committing the offense is merely a defense to an attempt charge. In this regard, commentators and the cases generally divide the impossibility defense into two categories: legal versus factual impossibility. 22 In U.S. vs. Wilson 23 the Court held that:

. . . factual impossibility of the commission of the crime is not a defense. If the crime could have been committed had the circumstances been as the defendant believed them to be, it is no defense that in reality the crime was impossible of commission.

Legal impossibility, on the other hand, is a defense which can be invoked to avoid criminal liability for an attempt. In U.S. vs. Berrigan, 24 the accused was indicated for attempting to smuggle letters into and out of prison. The law governing the matter made the act criminal if done without knowledge and consent of the warden. In this case, the offender intended to send a letter without the latter's knowledge and consent and the act was performed. However, unknown to him, the transmittal was achieved with the warden's knowledge and consent. The lower court held the accused liable for attempt but the appellate court reversed. It held unacceptable the contention of the state that "elimination of impossibility as a defense to a charge of criminal attempt, as suggested by the Model Penal Code and the proposed federal legislation, is consistent with the overwhelming modern view". In disposing of this contention, the Court held that the federal statutes did not contain such provision, and thus, following the principle of legality, no person could be criminally liable for an act which was not made criminal by law. Further, it said:

Congress has not yet enacted a law that provides that intent plus act plus conduct constitutes the offense of attempt irrespective of legal impossibility until such time as such legislative changes in the law take place, this court will not fashion a new non-statutory law of criminal attempt.

To restate, in the United States, where the offense sought to be committed is factually impossible or accomplishment, the offender cannot escape criminal liability. He can be convicted of an attempt to commit the substantive crime where the elements of attempt are satisfied. It appears, therefore, that the act is penalized, not as an impossible crime, but as an attempt to commit a crime. On the other hand, where the offense is legally impossible of accomplishment, the actor cannot be held liable for any crime — neither for an attempt not for an impossible crime. The only reason for this is that in American law, there is no such thing as an impossible crime. Instead, it only recognizes impossibility as a defense to a crime charge — that is, attempt.

CRIM CASES 45

This is not true in the Philippines. In our jurisdiction, impossible crimes are recognized. The impossibility of accomplishing the criminal intent is not merely a defense, but an act penalized by itself. Furthermore, the phrase "inherent impossibility" that is found in Article 4(2) of the Revised Penal Code makes no distinction between factual or physical impossibility and legal impossibility. Ubi lex non distinguit nec nos distinguere debemos.

The factual situation in the case at bar present a physical impossibility which rendered the intended crime impossible of accomplishment. And under Article 4, paragraph 2 of the Revised Penal Code, such is sufficient to make the act an impossible crime.

To uphold the contention of respondent that the offense was Attempted Murder because the absence of Palangpangan was a supervening cause independent of the actor's will, will render useless the provision in Article 4, which makes a person criminally liable for an act "which would be an offense against persons or property, were it not for the inherent impossibility of its accomplishment . . ." In that case all circumstances which prevented the consummation of the offense will be treated as an accident independent of the actor's will which is an element of attempted and frustrated felonies.

WHEREFORE, PREMISES CONSIDERED. the petition is hereby GRANTED, the decision of respondent Court of Appeals holding Petitioner guilty of Attempted Murder is hereby MODIFIED. We hereby hold Petitioner guilty of an impossible crime as defined and penalized in Articles 4, paragraph 2, and 59 of the Revised Penal Code, respectively. Having in mind the social danger and degree of criminality shown by Petitioner, this Court sentences him to suffer the penalty of six (6) months of arresto mayor, together with the accessory penalties provided by the law, and to pay the costs.

SO ORDERED.

CRIM CASES 46

ROBERTO A. JACINTO, petitioner, vs.HONORABLE COURT OF APPEALS and METROPOLITAN BANK AND TRUST COMPANY, respondents.

Romeo G. Carlos for petitioner.

Jorge, Perez & Associates for private respondents.

DAVIDE, JR., J.:p

This is an appeal by certiorari to partially set aside the Decision of the Court of Appeals in C.A-G.R. CV No. 08153 1.promulgated on 19 August 1987, which affirmed in toto the decision of the Regional Trial Court of Manila, Branch 11, in Civil Case No. 133164 entitled "Metropolitan Bank and Trust Co. vs. Inland Industries Inc. and Roberto Jacinto," the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered ordering defendants to pay, jointly and severally, the plaintiff, the principal obligation of P382,015.80 (Annex J-1 to J-3 of Stipulation), with interest/charges thereon at the rate of 16 % per annum from January 1, 1979 up to the time the said amount is fully paid, plus the sum of P20,000.00 as attorney's fees. Said defendants are further ordered to pay in solidum the costs of this suit.

SO ORDERED. 2

Petitioner's co-defendant in the courts below, Inland Industries Inc., just as in the case of petitioner's motion to reconsider the questioned decision, 3 chose not to join him in this appeal.

In Our resolution of 28 August 1988 We required the respondent to comment on the petition. Respondent Metropolitan Bank and Trust Co. filed its comment 4 on 12 October 1988. We required the petitioner to file a reply thereto, 5 which he comment plied with on 20 December 1988. 6

We gave due course to the petition on 8 May 1989 7 and required the parties to submit their respective memoranda.

Private respondent filed its memorandum on 29 June 1989 8 while petitioner asked leave to adopt his petition and reply as his memorandum, 9 which We granted on 14 June 1989. 10

Petitioner submits the following issues:

1. Whether or not the respondent Court of Appeals can validly pierce the fiction of corporate identity of the defendant corporation Inland Industries, Inc. even if there is no allegation in the complaint regarding the same, nor is there anything in the prayer demanding the piercing of the corporate veil of the corporation Inland Industries, Inc.;

2. Whether or not the Court of Appeals can validly pierce the fiction of corporate identity of the defendant Inland Industries, Inc. even if absolutely no proof was presented in court to serve as legal justification for the same.

We find this petition to be bereft of merit. The issues are basically factual and a careful scrutiny of the decisions of both courts below reveals that their findings and conclusions on the matter of piercing the veil of corporate fiction and on the liability of herein petitioner are overwhelmingly supported by the evidence.

Insofar as material and relevant to the issues raised, the trial court found and held: 11

As to [the] liability of [the] defendant Roberto A. Jacinto, it would appear that he is in factetum (sic), or, in fact, the corporation itself known as Inland Industries, Inc. Aside from the fact that he is admittedly the President and General Manager of the corporation and a substantial stockholders (sic) thereof, it was defendant Roberto A. Jacinto who dealt entirely with the plaintiff in those transactions. In the Trust Receipts that he signed supposedly in behalf of Inland Industries, Inc., it is not even mentioned that he did so in this official capacity.

xxx xxx xxx

In this case, the Court is satisfied that Roberto A. Jacinto was practically the corporation itself, the Inland industries, Inc.

In a detailed fashion, the respondent Court of Appeals brushed aside the posturing of petitioner as follows:

Defendant Roberto Jacinto, tried to escape liability and shift the entire blame under the trust receipts solely and exclusively on defendant-appellant corporation. He asserted that he cannot be held solidarily liable with the latter (defendant corporation) because he just signed said instruments in his official capacity as president of Inland Industries, Inc. and the latter (defendant corporation) has a juridical personality distinct and separate from its officers and stockholders. It is likewise asserted, citing an American case, that the principle of piercing the fiction of corporate entity should be applied with great caution and not precipitately, because a dual personality by a corporation and its stockholders would defeat the principal purpose for which a corporation is formed. Upon the other hand, plaintiff-appellee reiterated its allegation in the complaint that defendant corporation is just a mere alter ego of defendant Roberto Jacinto who is its President and General Manager, while the wife of the latter owns a majority of its shares of stock.

Defendants-appellants' assertion is plainly without legal basis. This is shown by the undisputed fact that Roberto Jacinto even admitted that he and his wife own 52% of the stocks of defendant corporation (TSN, April 22, 1985, p. 6). We cannot accept as true the assertion of defendant Jacinto that he only acted in his official capacity as President and General Manager of Inland Industries, Inc. when he signed the aforesaid trust receipts. To Our mind the same is just a clever ruse and a convenient ploy to thwart his personal liability therefor by taking refuge under the protective mantle of the separate corporate personality of defendant corporation.

CRIM CASES 47

As could be expected, Roberto Jacinto in his direct testimony presented a different corporate scenario regarding Inland Industries, Inc. and vehemently declared that it is Bienvenida Catabas who is its President, while Aurora Heresa is its Chairman of the Board. His assertion on this point, however, is not convincing in view of his admission in the same breath, that his wife, Hedy U. Jacinto, own (sic) with him 52% of the shares of stock of said corporation. Indeed, this circumstance –– even if standing alone –– cannot but engender in the most unprejudiced mind doubt and misgiving why Catabas and Heresa would be defendant corporation's President and Chairman of the Board, respectively. Pertinent portion of his testimony on this point is quoted hereunder:

Atty. Carlos Do you know the defendant Inland Industries, Inc.?

A Yes, sir. Because I am the General Manager of this corporation.

Q Aside from being the General Manager of the defendant corporation are you in any other way connected with the same?

A I am also a stockholder.

Q Does your corporation have a Board of Directors?

A Yes, sir.

Q By the way, who are the stockholders of this corporation?

A Bienvenida Catabas, Aurora Heresa, Paz Yulo, Hedy Y. Jacinto and myself.

Q Who is the President of the defendant corporation?

A Bienvenida Catabas.

Q Who is the Chairman of the Board?

A Aurora Heresa.

Q Do you have any relation with Hedy Y. Jacinto?

A She is my wife.

Q If you combine the stockholdings of your wife together with yours and percentage wise, how much is your equity?

Atty. Dizon raised some objections. However, the Court allowed the same.

A About 52 % (Ibid., pp. 3-6)

Furthermore, a cursory perusal of the Stipulation of facts clearly shows that defendant Roberto Jacinto acted in his capacity as President and General Manager of Inland Industries, Inc. when he signed said trust receipts. Pertinent portion of his testimony are quoted below:

(d) All the goods covered by the three (3) Letters of Credit (Annexes "A", "B" & "C") and paid for under the Bills of Exchange (Annexes "D", "E" & "F") were delivered to and received by defendant Inland Industries, Inc. through its co-defendant Roberto A. Jacinto, its President and General Manager, who signed for and in behalf of defendant Inland and agreed to the terms and conditions of three (3) separate trust receipts covering the same and herein identified as follows: . . . (p. 3 of Stipulations of Facts and Formulation of Issues [p. 95, Records]).

The conflicting statements by defendant Jacinto place in extreme doubt his credibility anent his alleged participation in said transactions and We are thus persuaded to agree with the findings of the lower court that the latter (Roberto Jacinto) was practically the corporation itself. Indeed, a painstaking examination of the records show that there is no clear-cut delimitation between the personality of Roberto Jacinto as an individual and the personality of Inland Industries, Inc. as a corporation.

The circumstances aforestated lead Us to conclude that the corporate veil that en-shrouds defendant Inland Industries, Inc. could be validly pierced, and a host of cases decided by our High Court is supportive of this view. Thus it held that "when the veil of corporate fiction is made as a shield to perpetuate fraud and/or confuse legitimate issues, the same should be pierced." (Republic vs. Razon, 20 SCRA 234; A.D. Santos, Inc. vs. Vasquez, 22 SCRA 1156; Emilio Cano Enterprises, Inc. vs. Court of Appeals, 13 SCRA 290). Almost in the same vein is the dictum enunciated by the same court in the case of Commissioner of Internal Revenue vs. Norton & Harrison Co., (11 SCRA 714), that "Where a corporation is merely an adjunct, business conduit or alter ego, the fiction of separate and distinct corporate entity should be disregarded."

In its resolution of 29 September 1987, the respondent Court of Appeals, on the contention again of petitioner that the finding that defendant corporation is his mere alter ego is not supported by the evidence and has no legal justification, ruled that:

The contention . . . is nothing but an empty assertion. A cursory perusal of the decision would at once readily show on pages 11-13 of the same that said factual findings of the court is well grounded as the same in fact even include a portion of the very testimony of said defendant-appellant admitting that he and his wife own 52% of the stocks of defendant corporation. The stipulation of facts also show (sic) that appellant Roberto Jacinto acted in his capacity as President/General Manager of defendant corporation and that "all the goods covered by the three (3) Letters of Credit (Annexes "A", "B" & "C") and paid for under the Bills of Exchange (Annexes "D", "E" & "F") were delivered to and received by defendant Inland Industries, Inc. through its co-defendant Roberto A. Jacinto, its President and General Manager, who signed for and in behalf of defendant Inland and agreed to the terms and conditions of three (3) separate trust receipts covering the same.

Petitioner, however, faults the courts below for piercing the veil of corporate fiction despite the absence of any allegation in the complaint questioning the separate identity and existence of Inland Industries, Inc. This is not accurate. While on the face of the complaint there is no specific allegation that the corporation is a mere alter ego of petitioner, subsequent developments, from the stipulation of

CRIM CASES 48

facts up to the presentation of evidence and the examination of witnesses, unequivocally show that respondent Metropolitan Bank and Trust Company sought to prove that petitioner and the corporation are one or that he is the corporation. No serious objection was heard from petitioner. Section 5 of Rule 10 of the Rules of Court provides:

Sec. 5. Amendment to conform to or authorize presentation of evidence. –– When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects, as if they had been raised in the pleadings. Such amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made upon motion of any party at any time, even after judgment; but failure so to amend does not affect the trial of these issues. If the evidence is objected to at the time of trial on the ground that it is not within the issues made by the pleadings, the court may allow the pleadings to be amended and shall do so freely when the presentation of the merits of the action will be subserved thereby and the objecting party fails to satisfy the court that the admission of such evidence would prejudice him in maintaining his action or defense upon the merits. The court may grant continuance to enable the objecting party to meet such evidence.

Pursuant thereto, "when evidence is presented by one party, with the express or implied consent of the adverse party, as to issues not alleged in the pleadings, judgment may be rendered validly as regards those issues, which shall be considered as if they have been raised in the pleadings. There is implied consent to the evidence thus presented when the adverse party fails to object thereto. 12

WHEREFORE, for lack of merit, the Petition is DISMISSED with costs against petitioner.

SO ORDERED.

Fernan, C.J., Gutierrez, Jr., Feliciano and Bidin, JJ., concur.

CRIM CASES 49

THE PEOPLE OF THE PHILIPPINES, petitioner, vs.HON. LORENZO B. VENERACION, Presiding Judge of the Regional Trial Court, National Capital Judicial Region, Branch 47, Manila, HENRY LAGARTO y PETILLA and ERNESTO CORDERO, respondents.

KAPUNAN, J.:

The sole issue in the case at bench involves a question of law. After finding that an accused individual in a criminal case has, on the occasion of Rape, committed Homicide, is the judge allowed any discretion in imposing either the penalty of Reclusion Perpetua or Death?

The facts antecedent to the case before this Court, as narrated by petitioner, 1 involve the perpetration of acts so bizarre and devoid of humanity as to horrify and numb the senses of all civilized men:

On August 2, 1994, the cadaver of a young girl, later identified as Angel Alquiza wrapped in a sack and yellow table cloth tied with a nylon cord with both feet and left hand protruding from it was seen floating along Del Pan St. near the corner of Lavesares St., Binondo, Manila.

When untied and removed from its cover, the lifeless body of the victim was seen clad only in a light colored duster without her panties, with gaping wounds on the left side of the face, the left chin, left ear, lacerations on her genitalia, and with her head bashed in.

On the basis of sworn statements of witnesses, booking sheets, arrest reports and the necropsy report of the victim, Abundio Lagunday, a.k.a. Jr. Jeofrey of no fixed address, and Henry Lagarto y Petilla, of 288 Area H. Parola Compound, Tondo, Manila were later charged with the crime of Rape with Homicide in an Information dated August 8, 1994 filed with the Regional Trial Court of Manila, National Capital Judicial Region. Said Information, docketed as Criminal Case No. 94-138071, reads:

That on or about August 2, 1994, in the City of Manila, Philippines, the said accused, conspiring and confederating together with one alias "LANDO" and other persons whose true names, identifies and present whereabouts are still unknown and helping one another, with treachery, taking advantage of their superior strength and nocturnity, and ignominy, and with the use of force and violence, that is, by taking ANGEL ALQUIZA y LAGMAN into a warehouse, covering her mouth, slashing her vagina, hitting her head with a thick piece of wood and stabbing her neck did then and there wilfully, unlawfully and feloniously have carnal knowledge of the person of said ANGEL ALQUIZA y LAGMAN, a minor, seven (7) years of age, against the latter's will and consent and on said occasion the said ABUNDIO LAGUNDAY, a.k.a. "LANDO" and others, caused her fatal injuries which were the direct cause of her death immediately thereafter.

CONTRARY TO LAW.

Subsequently thereafter, Ernesto Cordero y Maristela, a.k.a. "Booster," of 1198 Sunflower St., Tondo, Manila, Rolando Manlangit y Mamerta, a.k.a. "Lando," of 1274 Kagitingan St., Tondo, Manila, Richard Baltazar y Alino, a.k.a. "Curimao," also of 1274 Kagitingan St., Tondo, Manila, and Catalino Yaon y

Aberin, a.k.a. "Joel," of 1282 Lualhati St., Tondo, Manila were accused of the same crime of Rape with Homicide in an Information dated August 11, 1994, docketed as Criminal Case No. 94-138138, allegedly committed as follows:

That on or about the 2nd day of August, 1994, in the City of Manila, Philippines, the said accused conspiring and confederating with ABUNDIO LAGUNDAY Alias "JR," JEOFREY and HENRY LAGARTO y PETILLA who have already been charged in the Regional Trial Court of Manila of the same offense under Criminal Case No. 94-138071, and helping one another, with treachery, taking advantage of their superior strength and nocturnity and ignominy, and with the use of force and violence, that is, by taking ANGEL ALQUIZA y LAGMAN into a pedicab, and once helpless, forcibly bringing her to a nearby warehouse, covering her mouth, slashing her vagina, hitting her head with a thick piece of wood and stabbing her neck, did then and there wilfully, unlawfully and feloniously have carnal knowledge of the person of said ANGEL ALQUIZA y LAGMAN, a minor, seven (7) years of age, against the latter's will and consent and on said occasion the said accused together with their confederates ABUNDIO LAGARTO y PETILLA caused her fatal injuries which were the direct cause of her death immediately thereafter.

CONTRARY TO LAW.

The two criminal cases were consolidated to Branch 47 of the Regional Trial Court of Manila, presided over by respondent Judge.

Duly arraigned, all the accused, except Abundio Lagunday who was already dead, (allegedly shot by police escorts after attempting to fire a gun he was able to grab from SPO1 D. Vidad on August 12, 1994), pleaded "Not Guilty." Abundio Lagunday was dropped from the Information.

After trial and presentation of the evidence of the prosecution and the defense, the trial court rendered a decision 2 on January 31, 1995 finding the defendants Henry Lagarto y Petilla and Ernesto Cordero y Maristela guilty beyond reasonable doubt of the crime of Rape with Homicide and sentenced both accused with the "penalty of reclusion perpetua with all the accessories provided for by law." 3 Disagreeing with the sentence imposed, the City Prosecutor of Manila on February 8, 1995, filed a Motion for Reconsideration, praying that the Decision be "modified in that the penalty of death be imposed" against respondents Lagarto and Cordero, in place of the original penalty (reclusion perpetua). Refusing to act on the merits of the said Motion for Reconsideration, respondent Judge, on February 10, 1995, issued an Order denying the same for lack of jurisdiction. The pertinent portion reads:

The Court believes that in the above-entitled cases, the accused Lagarto and Cordero have complied with the legal requirements for the perfection of an appeal. Consequently, for lack of jurisdiction, this Court cannot take cognizance of the Motion for Reconsideration of the Public Prosecutor of Manila.

WHEREFORE, the order earlier issued by this Court regarding the Notices of Appeal filed by both herein accused is hereby reiterated.

The Clerk of this Court is hereby directed to transmit the complete records of these cases, together with the notices of appeal, to the Honorable Supreme Court, in accordance with Sec. 8, Rule 122 of the Revised Rules of Criminal Procedure.

CRIM CASES 50

SO ORDERED.

Hence, the instant petition.

The trial court's finding of guilt is not at issue in the case at bench. The basis of the trial court's determination of guilt and its conclusions will only be subject to our scrutiny at an appropriate time on appeal. We have thus clinically limited our narration of events to those cold facts antecedent to the instant case relevant to the determination of the legal question at hand, i.e., whether or not the respondent judge acted with grave abuse of discretion and in excess of jurisdiction when he failed and/or refused to impose the mandatory penalty of death under Republic Act No. 7659, after finding the accused guilty of the crime of Rape with Homicide.

We find for petitioner.

Obedience to the rule of law forms the bedrock of our system of justice. If judges, under the guise of religious or political beliefs were allowed to roam unrestricted beyond boundaries within which they are required by law to exercise the duties of their office, then law becomes meaningless. A government of laws, not of men excludes the exercise of broad discretionary powers by those acting under its authority. Under this system, judges are guided by the Rule of Law, and ought "to protect and enforce it without fear or favor," 4 resist encroachments by governments, political parties, 5 or even the interference of their own personal beliefs.

In the case at bench, respondent judge, after weighing the evidence of the prosecution and the defendant at trial found the accused guilty beyond reasonable doubt of the crime of Rape with Homicide. Since the law in force at the time of the commission of the crime for which respondent judge found the accused guilty was Republic Act No. 7659, he was bound by its provisions.

Section 11 of R.A. No. 7659 provides:

Sec. 11. Article 335 of the same Code is hereby amended to read as follows:

Art. 335. When and how rape is committed. — Rape is committed by having carnal knowledge of a woman under any of the following circumstances:

1. By using force or intimidation.

2. When the woman is deprived of reason or otherwise unconscious; and

3. When the woman is under twelve years of age or is demented.

The crime of rape shall be punished by reclusion perpetua.

Whenever the crime of rape is committed with the use of a deadly weapon or by two or more persons, the penalty shall be reclusion perpetua to death.

When by reason or on the occasion of the rape, the victim has become insane, the penalty shall be death.

When the rape is attempted or frustrated and a homicide is committed by reason or on the occasion thereof, the penalty shall be reclusion perpetua to death.

When by reason or on the occasion of the rape, a homicide is committed, the penalty shall be death. . . . 6

Clearly, under the law, the penalty imposable for the crime of Rape with Homicide is not Reclusion Perpetua but Death. While Republic Act 7659 punishes cases of ordinary rape with the penalty of Reclusion Perpetua, it allows judges the discretion — depending on the existence of circumstances modifying the offense committed — to impose the penalty of either Reclusion Perpetua only in the three instances mentioned therein. Rape with homicide is not one of these three instances. The law plainly and unequivocably provides that "[w]hen by reason or on the occasion of rape, a homicide is committed, the penalty shall be death." The provision leaves no room for the exercise of discretion on the part of the trial judge to impose a penalty under the circumstances described, other than a sentence of death.

We are aware of the trial judge's misgivings in imposing the death sentence because of his religious convictions. While this Court sympathizes with his predicament, it is its bounden duty to emphasize that a court of law is no place for a protracted debate on the morality or propriety of the sentence, where the law itself provides for the sentence of death as a penalty in specific and well-defined instances. The discomfort faced by those forced by law to impose the death penalty is an ancient one, but it is a matter upon which judges have no choice. Courts are not concerned with the wisdom, efficacy or morality of laws. In People vs. Limaco 7 we held that:

[W]hen . . . private opinions not only form part of their decision but constitute a decisive factor in arriving at a conclusion and determination of a case or the penalty imposed, resulting in an illegality and reversible error, then we are constrained to state our opinion, not only to correct the error but for the guidance of the courts. We have no quarrel with the trial judge or with anyone else, layman or jurist as to the wisdom or folly of the death penalty. Today there are quite a number of people who honestly believe that the supreme penalty is either morally wrong or unwise or ineffective. However, as long as that penalty remains in the statute books, and as long as our criminal law provides for its imposition in certain cases, it is the duty of judicial officers to respect and apply the law regardless of their private opinions. It is a well settled rule that the courts are not concerned with the wisdom, efficacy or morality of laws. That question falls exclusively within the province of the Legislature which enacts them and the Chief Executive who approves or vetoes them. The only function of the judiciary is to interpret the laws and, if not in disharmony with the Constitution, to apply them. And for the guidance of the members of the judiciary we feel it incumbent upon us to state that while they as citizens or as judges may regard a certain law as harsh, unwise or morally wrong, and may recommend to the authority or department concerned, its amendment, modification, or repeal, still, as long as said law is in force, they must apply it and give it effect as decreed by the law-making body. 8

Finally, the Rules of Court mandates that after an adjudication of guilt, the judge should impose "the proper penalty and civil liability provided for by the law on the accused." 9 This is not a case of a

CRIM CASES 51

magistrate ignorant of the law. This is a case in which a judge, fully aware of the appropriate provisions of the law, refuses to impose a penalty to which he disagrees. In so doing, respondent judge acted without or in excess of his jurisdiction or with grave abuse of discretion amounting to a lack of jurisdiction in imposing the penalty of Reclusion Perpetua where the law clearly imposes the penalty of Death.

WHEREFORE, PREMISES CONSIDERED, the instant petition is GRANTED. The case is hereby REMANDED to the Regional Trial Court for the imposition of the penalty of death upon private respondents in consonance with respondent judge's finding that the private respondents in the instant case had committed the crime of Rape with Homicide under Article 335 of the Revised Penal Code, as amended by Section 11 of Republic Act No. 7659, subject to automatic review by this Court of the decision imposing the death penalty.

SO ORDERED.

Feliciano, Padilla, Romero, Bellosillo, Melo, Puno, Mendoza, Francisco and Hermosisima, Jr., JJ., concur.

Separate Opinions

NARVASA, C.J., concurring:

I concur with the conclusions and dispositions set forth in the opinion of Mr. Justice Kapunan. I draw up this separate opinion merely to address a question which may be raised in relation to the appeal taken by the accused from the judgment of conviction rendered by respondent Judge. It will be recalled that respondent Judge declined to act on the merits of motion for reconsideration filed by the prosecution — praying that his decision sentencing both accused to suffer reclusion perpetua be "modified in that the penalty of death be imposed" — for the reason that since the accused had already "complied with the legal requirements for the perfection of an appeal," the Trial Court had lost jurisdiction over the cases. It was precisely that refusal that prompted the institution in this Court of the special civil action of certiorari at bar.

It is indeed axiomatic that once an appeal is perfected from a judgment, jurisdiction is lost by the court rendering the judgment; and jurisdiction over the case passes to the appellate tribunal. This proposition considered, and following respondent Judge's reasoning, this Court's directive for the remand of the case "to the Regional Trial Court for the imposition of the penalty of death upon private respondents," might appear to be open to question, since it would require the Trial Court to act in cases over which it had lost jurisdiction. Such a conclusion is not warranted.

The judgment in question is void, and has been annulled and set aside by this Court, because rendered "without or in excess of . . . jurisdiction or with grave abuse of discretion amounting to lack of jurisdiction," in so far as it imposes, in light of the facts found to have been proven beyond reasonable doubt, a penalty other than that peremptorily prescribed by law. The judgment being void, the appeal attempted to be taken therefrom is inefficacious. The Trial Court may not be deemed to have thereby lost jurisdiction of the cases. It cannot thus be said that it is being required by this Court to act in cases over which it has already lost jurisdiction. There exists no legal obstacle to the remand of the cases to it and its modification of the judgment so that it may comply with the mandatory prescription of the law.

REGALADO, J., concurring:

I concur without reservation in the ponencia in this case and its directive that the court a quo impose the correct penalty of death as provided by law and consequent to its findings of guilt on the part of private respondents. Indeed, this separate opinion which explicates my conformity with the procedure adopted and the mandate thereof would not have been necessary were it not for the contrary observations that the petition herein should either have been dismissed or consolidated with the criminal case elevated on appeal by private respondents.

Such digression from the judgment unconditionally accepted by the other members of the Court does not impress me as being concordant with the Rules of Court and decisional law. What is before us in the case at bar is an original civil action invoking the extraordinary writ of certiorari for the imposition of the correct penalty specified by law, which legal duty respondent judge refused to comply with in grave abuse of his judicial discretion. 1 On the other hand, the criminal case with which it is sought to be consolidated is an appellate recourse wherein the relief sought is primarily the reversal of the finding of guilt and the absolution of private respondents.

Evidently, the determinative issues involved and the limited relief sought in the present special civil action are entirely different from the issues for resolution and the modificatory judgment desired in the appealed criminal case. The basic rule in consolidation of cases in civil procedure 2 requires, among others, the same subject matter and the existence of a common question of law or fact. This is essentially the same as the rule on consolidation in criminal procedure 3 which contemplates charges for offenses founded on the same facts, or forming part of a series of offenses of similar character.

Also, these reglementary requisites for consolidation require two or more ordinary civil or criminal actions, and not a special civil action in combination with the former. The impropriety of the latter situation is specially underscored where the resolution of the controversy in the special civil action is a pre-judicial matter in the appealed criminal case. These considerations apply to both the trial courts in the exercise of original jurisdiction and to the appellate courts in the implementation of revisory power.

The purpose of the present original action for certiorari is to have the erroneous judgment of respondent judge — erroneous because he imposed the wrong penalty — corrected on that score in the first instance. After such correction shall have been effected, then the appeal from his judgment shall proceed for the desired review by this Court to determine the guilt or innocence of appellants. The corrective action must proceed first and the resultant amended judgment containing the proper

CRIM CASES 52

penalty shall be the basis for the review as to whether appellants are truly guilty and have to be meted that ultimate penalty. To have the certiorari action proceed simultaneously and in unification with the appellate proceeding strikes me as an aberrant procedure. While it does not exactly square with the figurative posture of putting the cart before the horse, it does result in the same absurdity of both the horse and the cart moving abreast at the same time along the same judicial path.

It would even be worse if, as suggested, this certiorari action should be dismissed and the appellate review be conducted with the judgment containing an unauthorized penalty as the basis therefor, with this Court closing its eyes to such a flagrant mistake. This time the cart precedes the horse. True, an appeal throws the judgment a quo open for review and the Court may raise the penalty to the appropriate punitive level. But, as the People pertinently observes, what is there to prevent appellants from withdrawing their appeal upon sensing from the arguments that, instead of the acquittal or reduced penalty aspired for, the ultimate denouement would be the death sentence?

Jurisprudence tells us that before the case is submitted for decision, an appellant may withdraw his appeal in the appellate court. 4 Generally, the withdrawal of an appeal before the filing of the appellee's brief in this Court is permitted. 5 Assuming that the Court denies the withdrawal of the appeal in order that the mistake in the penalty imposed may be corrected in the judgment of the case on the merits, 6 why should the appellate course of the proceedings still have to be subject to such contingencies — with the inevitable waste of time and effort in the formulation of alternative theories in two sets of pleadings by both parties — when with the decisive sweep of the adjudgment here the doubts are dissipated and the real areas of contention are laid bare?

Nor is that all. Appellants have come to this Court through the medium of an appeal by writ of error from a judgment of the trial court imposing the wrong penalty of reclusion perpetua. If the mistake in the penalty is now rectified with the death sentence being substituted therefor, as undeniably it should be, then the case will consequently be before this Court on automatic review. That provision calling for automatic review when capital punishment is inflicted 7 serves equally the interests of both the defense and the prosecution through protective features established by case law.

Thus, even if the accused had unnecessarily appealed from the judgment imposing the penalty of death and he thereafter withdraws his appeal, the automatic review of the case shall nonetheless proceed, albeit without the benefit of briefs or arguments from the accused. 8 The automatic review of the case shall proceed even if the death convict shall escape, 9 as an exception to the provisions of Section 8, Rule 124, and such automatic review cannot be waived. 10 The aforementioned beneficial effects are not provided for and may not be availed of by the accused in an ordinary appeal to this Court.

The automatic review of the death sentence ensures the right of the condemned person to procedural due process on appeal, and safeguards the interests of the State by exacting the corresponding penal sanction decreed by law. The disposition adopted by the Court in this case subserves the ends of these fundamental policies, hence my unqualified assent thereto.

VITUG, J., dissenting:

The ponencia itself indicates that the case against the convicted accused is already on appeal before this Court. Thus, the instant petition, in my view, has become academic since an appeal brings the case

wide open for review and consideration. A ruling on the petition would be precipitate and might be so perceived as peremptory on the imposition of the death penalty.

With all due respect, it is my personal view that if the Court is not disposed to dismiss the petition, it should at the very least be consolidated with the appealed case.

Accordingly, I am constrained, at this time, to vote for the dismissal of the petition.

Davide, Jr., J. concurs.

Separate Opinions

NARVASA, C.J., concurring:

I concur with the conclusions and dispositions set forth in the opinion of Mr. Justice Kapunan. I draw up this separate opinion merely to address a question which may be raised in relation to the appeal taken by the accused from the judgment of conviction rendered by respondent Judge. It will be recalled that respondent Judge declined to act on the merits of motion for reconsideration filed by the prosecution — praying that his decision sentencing both accused to suffer reclusion perpetua be "modified in that the penalty of death be imposed" — for the reason that since the accused had already "complied with the legal requirements for the perfection of an appeal," the Trial Court had lost jurisdiction over the cases. It was precisely that refusal that prompted the institution in this Court of the special civil action of certiorari at bar.

It is indeed axiomatic that once an appeal is perfected from a judgment, jurisdiction is lost by the court rendering the judgment; and jurisdiction over the case passes to the appellate tribunal. This proposition considered, and following respondent Judge's reasoning, this Court's directive for the remand of the case "to the Regional Trial Court for the imposition of the penalty of death upon private respondents," might appear to be open to question, since it would require the Trial Court to act in cases over which it had lost jurisdiction. Such a conclusion is not warranted.

The judgment in question is void, and has been annulled and set aside by this Court, because rendered "without or in excess of . . . jurisdiction or with grave abuse of discretion amounting to lack of jurisdiction," in so far as it imposes, in light of the facts found to have been proven beyond reasonable doubt, a penalty other than that peremptorily prescribed by law. The judgment being void, the appeal attempted to be taken therefrom is inefficacious. The Trial Court may not be deemed to have thereby lost jurisdiction of the cases. It cannot thus be said that it is being required by this Court to act in cases over which it has already lost jurisdiction. There exists no legal obstacle to the remand of the cases to it and its modification of the judgment so that it may comply with the mandatory prescription of the law.

REGALADO, J., concurring:

I concur without reservation in the ponencia in this case and its directive that the court a quo impose the correct penalty of death as provided by law and consequent to its findings of guilt on the part of

CRIM CASES 53

private respondents. Indeed, this separate opinion which explicates my conformity with the procedure adopted and the mandate thereof would not have been necessary were it not for the contrary observations that the petition herein should either have been dismissed or consolidated with the criminal case elevated on appeal by private respondents.

Such digression from the judgment unconditionally accepted by the other members of the Court does not impress me as being concordant with the Rules of Court and decisional law. What is before us in the case at bar is an original civil action invoking the extraordinary writ of certiorari for the imposition of the correct penalty specified by law, which legal duty respondent judge refused to comply with in grave abuse of his judicial discretion. 1 On the other hand, the criminal case with which it is sought to be consolidated is an appellate recourse wherein the relief sought is primarily the reversal of the finding of guilt and the absolution of private respondents.

Evidently, the determinative issues involved and the limited relief sought in the present special civil action are entirely different from the issues for resolution and the modificatory judgment desired in the appealed criminal case. The basic rule in consolidation of cases in civil procedure 2 requires, among others, the same subject matter and the existence of a common question of law or fact. This is essentially the same as the rule on consolidation in criminal procedure 3 which contemplates charges for offenses founded on the same facts, or forming part of a series of offenses of similar character.

Also, these reglementary requisites for consolidation require two or more ordinary civil or criminal actions, and not a special civil action in combination with the former. The impropriety of the latter situation is specially underscored where the resolution of the controversy in the special civil action is a pre-judicial matter in the appealed criminal case. These considerations apply to both the trial courts in the exercise of original jurisdiction and to the appellate courts in the implementation of revisory power.

The purpose of the present original action for certiorari is to have the erroneous judgment of respondent judge — erroneous because he imposed the wrong penalty — corrected on that score in the first instance. After such correction shall have been effected, then the appeal from his judgment shall proceed for the desired review by this Court to determine the guilt or innocence of appellants. The corrective action must proceed first and the resultant amended judgment containing the proper penalty shall be the basis for the review as to whether appellants are truly guilty and have to be meted that ultimate penalty. To have the certiorari action proceed simultaneously and in unification with the appellate proceeding strikes me as an aberrant procedure. While it does not exactly square with the figurative posture of putting the cart before the horse, it does result in the same absurdity of both the horse and the cart moving abreast at the same time along the same judicial path.

It would even be worse if, as suggested, this certiorari action should be dismissed and the appellate review be conducted with the judgment containing an unauthorized penalty as the basis therefor, with this Court closing its eyes to such a flagrant mistake. This time the cart precedes the horse. True, an appeal throws the judgment a quo open for review and the Court may raise the penalty to the appropriate punitive level. But, as the People pertinently observes, what is there to prevent appellants from withdrawing their appeal upon sensing from the arguments that, instead of the acquittal or reduced penalty aspired for, the ultimate denouement would be the death sentence?

Jurisprudence tells us that before the case is submitted for decision, an appellant may withdraw his appeal in the appellate court. 4 Generally, the withdrawal of an appeal before the filing of the appellee's brief in this Court is permitted. 5 Assuming that the Court denies the withdrawal of the appeal in order that the mistake in the penalty imposed may be corrected in the judgment of the case on the merits, 6 why should the appellate course of the proceedings still have to be subject to such contingencies — with the inevitable waste of time and effort in the formulation of alternative theories in two sets of pleadings by both parties — when with the decisive sweep of the adjudgment here the doubts are dissipated and the real areas of contention are laid bare?

Nor is that all. Appellants have come to this Court through the medium of an appeal by writ of error from a judgment of the trial court imposing the wrong penalty of reclusion perpetua. If the mistake in the penalty is now rectified with the death sentence being substituted therefor, as undeniably it should be, then the case will consequently be before this Court on automatic review. That provision calling for automatic review when capital punishment is inflicted 7 serves equally the interests of both the defense and the prosecution through protective features established by case law.

Thus, even if the accused had unnecessarily appealed from the judgment imposing the penalty of death and he thereafter withdraws his appeal, the automatic review of the case shall nonetheless proceed, albeit without the benefit of briefs or arguments from the accused. 8 The automatic review of the case shall proceed even if the death convict shall escape, 9 as an exception to the provisions of Section 8, Rule 124, and such automatic review cannot be waived. 10 The aforementioned beneficial effects are not provided for and may not be availed of by the accused in an ordinary appeal to this Court.

The automatic review of the death sentence ensures the right of the condemned person to procedural due process on appeal, and safeguards the interests of the State by exacting the corresponding penal sanction decreed by law. The disposition adopted by the Court in this case subserves the ends of these fundamental policies, hence my unqualified assent thereto.

VITUG, J., dissenting:

The ponencia itself indicates that the case against the convicted accused is already on appeal before this Court. Thus, the instant petition, in my view, has become academic since an appeal brings the case wide open for review and consideration. A ruling on the petition would be precipitate and might be so perceived as peremptory on the imposition of the death penalty.

With all due respect, it is my personal view that if the Court is not disposed to dismiss the petition, it should at the very least be consolidated with the appealed case.

Accordingly, I am constrained, at this time, to vote for the dismissal of the petition.

Davide, Jr., J. concurs.

CRIM CASES 54

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs.DANILO CORBES Y OLAZO, MANUEL, VERGEL Y PASCUAL, and six (6) JOHN DOEs, accused.

DANILO CORBES Y OLAZO and MANUEL VERGEL Y PASCUAL, accused-appellants.

BELLOSILLO, J.:

DANILO CORBES y OLAZO and MANUEL VERGEL y PASCUAL appeal from the decision dated 27 December 1991 of the Regional Trial Court of Caloocan City, Br. 124, finding them guilty as principals by conspiracy of the crime of robbery with homicide under par. 1, Art. 294 of the Revised Penal Code and sentencing them to suffer the penalty of reclusion plus damages. 1

The antecedents: At about nine o'clock in the morning of 17 November 1990 six (6) armed men entered the premises of the Caloocan Consortium Corporation at No. 305 Cordero Street, Caloocan City, and took away from the establishment P169,000.00 in cash and P4,500.00 from Mateo Figuracion, an employee therein. They also took with them the .38 calibre revolver of security guard Timoteo Palicpic whom they shot to death. The malefactors then ran towards 8th Avenue where Daniel Corbes and Manuel Vergel had parked their getaway vehicle, a blue passenger jeep. They then sped away.

That same day, Manuel Vergel went to the Caloocan Police Station and reported the incident. He claimed that the robbers used his passenger jeep in fleeing from the Caloocan Consortium Corporation, but he denied any previous knowledge of the robbery or of any intentional participation therein. However, upon further interrogation by P/Cpl Daniel G. Del Rosario, Supervisor of the Dayshift Investigation Section, Caloocan City Investigation Division, Vergel retracted his earlier statements and pointed to Danilo Corbes who together with the other accused allegedly planned the robbery and convinced him to drive for them. 2 When apprehended and brought to the police station, Corbes in turn pointed to a certain "Benny" as the brains behind the crime. 3

Corbes, Vergel and six (6) John Does (still at large) were charged as principals by conspiracy. On the witness stand Vergel however diverged from his earlier story and insisted that the jeep he was driving was merely hired by Corbes and Benny on the pretext of hauling scrap metal from Caloocan City. As soon as he parked his jeep along 8th Avenue, Benny alighted from the jeep leaving him with Corbes. Vergel maintained that at that time he knew nothing of the robbery being perpetrated at the Caloocan Consortium Corporation and that he became aware of it only when Benny came back from the direction of Cordero Street about ten (10) to fifteen (15) minutes later with several armed men who boarded the jeep and threatened him with bodily harm if he would not start its engine and drive. So he did as they ordered. After the men alighted at 9th Avenue, he proceeded to the house of Avelino Vergel, the owner of the jeep, and together they went to the Caloocan City Police Station to report the matter.

Daniel Corbes likewise professed innocence. Although he admitted having approached Vergel, he contended that he did so only to accommodate Benny who had sought his help in looking for a jeep for hire. Being the Vice-President of DAMATA (Damayan ng Maralitang Tahanan), a neighborhood association in Letre, Malabon, he accompanied Benny to Sangandaan and there waited for Vergel who

agreed to have the jeep he was driving hired for a fee of P250.00. Then together with Vergel and Benny he left for Caloocan City allegedly upon Vergel's invitation.

The trial court rejected the pretensions of Corbes and Vergel; instead, it convicted the two (2) accused on the basis of the eyewitness account of Elena San Jose whose testimony established their participation in the robbery as lookout and driver, respectively.

Specifically, Elena San Jose testified that while she was rocking her baby to sleep in the veranda of her house at 8th Avenue she noticed a blue-colored jeep parked about three (3) meters away. Vergel was at the driver's seat. She saw Vergel alight several times from the jeep ostensibly to inspect its engine and other parts as if something was wrong with them, while Vergel's companion whom she identified as Corbes walked to and fro along 8th Avenue up to the corner of Cordero Street. Half an hour later Elena saw four (4) men in a jolly mood approaching and shouting "Yahoo! Yahoo!" from the direction of Cordero Street. They immediately boarded the jeep as Vergel hurried them up: "Dalian n'yo, baka tayo mahuli!" The vehicle then drove away in the direction of F. Roxas Street. 4

The court a quo accorded evidentiary weight to the testimony of Dante Despida, owner of the Gulf-Pacific Security Agency, Inc., who testified that on 19 November 1990 Vergel and Corbes admitted to him inside the Caloocan Police Station that they participated in the robbery holdup as driver of the getaway vehicle and as lookout, respectively. Thus, Vergel and Corbes were sentenced to suffer the penalty of reclusion perpetua and ordered to pay jointly and severally, (a) the amount of cash stolen, (b) the value of the .38 cal. revolver taken, and (c) P50,000.00 as consequential damages to the heirs of Timoteo Palicpic.

Appellants contend in this appeal that conspiracy was not sufficiently proved since it cannot be inferred solely from their mere presence at the crime scene. In addition, Vergel disparages the testimony of Elena San Jose as being rehearsed and replete with inconsistencies, while that of Dante Despida relative to the oral confessions allegedly made to him inside the Caloocan Police Station as unworthy of belief considering that he had no business inside the detention cell since he was not even a police investigator, and considering further that he was the uncle 5 of security guard Timoteo Palicpic who was gunned down during the robbery.

We sustain the claim of appellants that the evidence failed to meet the quantum of proof required by law to establish conspiracy which jurisprudence dictates must be shown to exist as clearly and convincingly as the commission of the crime itself. 6 No less than proof beyond reasonable doubt is required. 7

In the instant case, no conclusive proof was presented that appellant Manuel Vergel conspired with the other accused to commit robbery. What is indubitable is that he was approached by Corbes who was tasked to look for a getaway vehicle and was persuaded to act as driver in fetching the group from the venue of the robbery. Vergel's feigned ignorance of any prior knowledge of the robbery is negated by his remark, "Dalian n'yo, baka tayo mahuli!" made to the robbers as they were boarding the jeep. Such utterance, which indicates knowledge of the criminal design of the malefactors, coupled with his act of driving for the robbers, makes appellant Vergel guilty as an accomplice, i.e., one who knows the criminal design of the principal and cooperates knowingly or intentionally therewith by an act which even if not rendered the crime would be committed just the same. 8 In one case, 9 we held that the

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driver of the taxicab, knowing that his co-accused were going to commit robbery permitted them to use his taxicab in going to the place where the robbery was committed, is an accomplice.

As regards appellant Danilo Corbes, there is similarly a lack of adequate evidence of conspiracy. The evidence merely points out that Corbes looked for a jeep to be used as getaway vehicle of the robbers and, to that end, he intentionally sought out and convinced Manuel Vergel to act as driver. Moreover, he went with Vergel and Benny to Caloocan City where the robbery was staged. We have also held that the liability of one whose participation was limited to looking for a banca and providing one to a gang of bank robbers, 10 or one who went with the actual perpetrators of a crime without conspiring with them, is only that of an accomplice. 11 Where the quantum of proof required to establish conspiracy is lacking, the doubt created as to whether accused acted as principal or accomplice will always be resolved in favor of the milder form of liability, that of a mere accomplice 12 Besides, in several cases wherein the Court confirmed the existence of conspiracy, some accused were held liable as mere accomplices only because their role in the commission of the crime was not indispensable; in other words, minor. 13 Courts sometimes draw the inference of guilty participation in the criminal design from concerted acts in the consummation of the criminal act and from the form and manner in which assistance is rendered. To reiterate, in case of doubt, the courts naturally lean to the milder form of responsibility. 14

Furthermore, we reduce appellants' liability to the crime of robbery only. It was not established by the evidence that the other accused, who are at large, had agreed to kill if necessary to carry out successfully the plan to rob. On the contrary, the records show that one of the robbers berated the gunman for having shot the security guard. 15 Therefore, what appellants may be said to have joined was merely the criminal design to rob, which makes them accomplices. Their complicity must accordingly be limited to the robbery, not to the killing of Timoteo Palicpic. Waiting only at the parked jeep at 8th Avenue could not have given them the opportunity to prevent the killing, as is required of one seeking relief from liability for assaults committed during the robbery. 16 The Court had occasion to rule that the jeep driver, who was unaware of the killing perpetrated inside the building as he stayed always near his jeep, could not be deemed a co-conspirator in the killing of the guards, as the killing was not part of the original plan but arose only during the exigency of the moment. 17

The penalty for robbery under par. 5, Art. 294 of the Revised Penal Code is prision correccional in its maximum period to prision mayor in its medium period the duration of which is four (4) years two (2) months and one (1) day to ten (10) years. As the robbery was committed by a band under Art. 295 the penalty should be imposed in its maximum period. Since accused-appellants are found guilty only as accomplices to the robbery in band, the imposable penalty shall be one degree lower which is arresto mayor in its maximum period to prision correccional in its medium period or four (4) months and one (1) day to four (4) years and two (2) months. Applying the Indeterminate Sentence Law, if only for the purpose of determining the penalty to be imposed, the minimum shall be taken from the penalty next lower in degree, i.e., destierro in its maximum period to arresto mayor in its medium period or four (4) years two (2) months and one (1) day of destierro to four (4) months of arresto mayor medium, while the maximum shall be taken from the maximum of the imposable penalty as herein before stated or four (4) years and two (2) months of prision correccional medium. Both accused-appellants having already been detained since 20 November 1990, 18 or more than the maximum of their indeterminate penalty, they should now be immediately released from custody pursuant to B. P. Blg. 85.

WHEREFORE, the judgment appealed from is MODIFIED. Accused-appellants DANILO CORBES Y OLAZO and MANUEL VERGEL y PASCUAL are declared GUILTY merely as ACCOMPLICES to the crime of robbery and sentenced accordingly to an indeterminate prison term of four (4) months of arresto mayor medium as minimum to four (4) years and two (2) months of prision correccional medium as maximum.

Accused-appellants Danilo Corbes y Olazo and Manuel Vergel y Pascual having already been detained for more than the maximum of their indeterminate penalty, their immediate release from custody is likewise ordered unless they are held for another lawful cause. Costs de oficio.

SO ORDERED.

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G.R. No. 106357 September 3, 1998

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs.PRISCILLA BALASA, NORMITA VISAYA, GUILLERMO FRANCISCO, NORMA FRANCISCO and ANALINA FRANCISCO, accused, NORMA FRANCISCO, GUILLERMO FRANCISCO and ANALINA FRANCISCO, accused-appellants.

G.R. No. 108601-02 September 3, 1998

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs.PRISCILLA BALASA, NORMITA VISAYA, GUILLERMO FRANCISCO, NORMA FRANCISCO and ANALINA FRANCISCO, accused, NORMA FRANCISCO, GUILLERMO FRANCISCO and ANALINA FRANCISCO, accused-appellants.

ROMERO, J.:

Avarice, mother of crimes, greedy for more the more she possesses, eversearching open-mouthed for gold. 1

Greed has always been one of man's failings. The hope of greater gain has lured many a man to throw caution, and his common sense, to the wind. This human foible, known to many, has been exploited throughout the ages by con men, charlatans and cheats to bilk the gullible public of their hard-earned money. History has thus seen the unraveling of various disingenuous stratagems which are at bottom nothing but seams. The case at hand once again proves that "a sucker is born every minute."

Totoong walang pagkaubos sa ating daigdig ang mga taong nanlilinlang. Hindi magkakagayon naman kung walang nagpapalinlang. Dahil sa kanilang malaking hangarin na magkamal ng kimpal kimpal na kayamanan, pinapasukan nila ang mga kaduda-dudang alok ng mga mapagsamantala na kung sila ay mamuhunan ng kaunting salapi, ito ay tutubo ng malaki sa ilang araw lamang. Kaya't napakaraming mga tao ang nagagantso. Hindi masasabing mga hangal o dili kaya'y mga maralita na walang gaanong pinag-aralan ang mga nabibiktima. Kahit ang mga maykaya at matataas sa ating lipunan ay napaglalaruan din. Milyun-milyong salapi ang nahuhuthot sa kanila, hindi ng mga masakim na magnanakaw, kundi ng kanila na ring mga kasamahan sa tinatawag na "alta sociedad." Mismong mga kaibigan at kapanatag ng loob ang naguudyok sa kanilang sumali sa mga pakana na magpapayaman sa kanila. Higit namang nakakaawa kapag ang naloloko ay iyong nangungutang lamang at nagbabakasakali na ang ilang daan nila ay magiging libo.

Itong kapasiyahang ito ng Mataas na Hukuman ay nagbababalang muli. Magpakaingat-ingat ang lahat. Ang naghahangad ng kagitna, isang salop ang nawawala.

Iyon namang nanlilinlang. Walang gawaing masama na hindi nabubunyag rin. Totoong mahigpit ang ating batas na pumaparusa sa mga ganyang hindi na natututo, lalo't higit kung ang mga salarin ay mga sindikato.

Tunghayan natin kung papaano naganap ang gawang panloloko sa mga taga Palawan ng mga dayo lamang.

On July 6, 1989, the Panata Foundation of the Philippines, Inc., a non-stock, non-profit corporation with principal address at San Miguel, Puerto Princesa, Palawan, was registered with the securities and Exchange Commission, under S.E.C. Reg. No. 165565. Its ten incoporators were Priscilla Balasa, Normita Visaya, Analina Francisco, Lolita Gelilang, Cynthia Ang, Norma Francisco, Purabel Espidol, Melinda Mercado, Rodolfo Ang, Jr. and Teresa G. Carandang. Five incorporators, namely, Priscilla Balasa, Normita Visaya, Analina Francisco, Lolita Gelilang and Cynthia Ang were named first trustees.

In addition, the management of the foundation was entrusted to Priscilla Balasa, as president and general manager; Normita Visaya as corporate secretary and head comptroller; Norma Francisco as cashier; Guillermo Francisco as the disbursing officer; and Analina Francisco as treasurer. The latter also doubled as a typist of the Foundation.

On the other hand, the employees of the foundation were the tellers Rosemarie Balasa, Sylvia Magnaye, Judith Ponciano, Jessica Buaya, Rosario Arciaga, Paul Francisco, Enriquita Gabayan and Anita Macmac. The comptrollers, Ruth Jalover, Amarino Agayo, and Avelina Yan were under the supervision of Normita Visaya. Nelia Daco, one of the clerks assigned outside, was the one in direct contact with the depositors.

The Foundation's purposes, as stated in its by-laws, were as follows:

1. Uplift members' economic condition by way of financial or consultative basis (sic);

2. To encourage members in a self-help program;

3. To grant educational assistance;

4. To implement the program on the Anti-Drug campaign;

5. To acquire facilities either by or through purchase, lease, bequest of donations, equipments (sic), machineries (sic) and supplies for purposes of carrying out its business operation or hold such real or personal properties as may be convenient and proper in order to achieve the purpose of this corporation;

6. To cooperate with other organizations, institutions with similar activities for purposes of carrying out its business; and

7. To organize seminars or conferences specially in the rural areas and other selected cities. 2

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After obtaining its SEC registration, the foundation immediately swung into operation. It sent out brochures soliciting deposits from the public, assuring would-be depositors that their money would either be doubled after 21 days or trebled after 30 days. Priscilla Balasa also went around convincing people to make deposits with the foundation at their office at the Diaz Apartment, Puerto Princesa.

The modus operandi for investing with the foundation was as follows:

When a person would deposit an amount, the amount would be taken by a clerk to be given to the teller. The teller would then fill up a printed form called a "slot." These "slots" were part of a booklet, with one booklet containing one hundred "slots." A "slot," which resembled a check, contained the following data:

PANATA FOUNDATION Control No. 33

(Logo) OF THE PHILIPPINES INC. Date 12-5-87 / Dec. 26, 1987

PFOPI Puerto Princesa, Palawan Amount P 500.00

Sec. Reg. No. 165565

M CHESTER MONREAL

Address RPC

Share FIVE

Amount in words FIVE HUNDRED PESOS Only

(Sgd.)

(Sgd.) PRICILLA BALASA

————————— —————————

Signature of Member President / Manager

No. 30333 3

The control number indicated the number of the "slot" in a booklet, while the space after "date" would contain the date when the slot was acquired, as well as the date of its maturity. The amount deposited determined the number of shares, one share being equivalent to one hundred pesos. The depositor had the discretion when to affix his signature on the space provided therefor. Some would sign their slot only after payment on maturity, while others would sign as soon as they were given the slot. However, without the control number and the stamp of the teller, duly signed or initialed, no depositor could claim the proceeds of his deposit upon maturity. 4

After the slot had been filled up by the teller, he would give it to the clerk assigned outside. The clerk would then give the slot to the depositor. Hence, while it was the teller who prepared and issued the slot, he had no direct contact with the depositor. The slots handed to a depositor were signed beforehand by the president of the foundation.

Every afternoon, the comptrollers would take the list of depositors made by the tellers with the amounts deposited by each, and have these typed. Norma Francisco would then receive from the tellers the amounts deposited by the public. It was also her job to pay the salaries of the foundation's employees. For his part, Guillermo Francisco would release money whenever a deposit would mature as indicated in the slots.

According to the foundations rules, an investor could deposit up to P5,000.00 only, getting a slot corresponding thereto. Anyone who deposited more than that amount would, however, be given a slot but the slot had to be in he name of another person or several other persons, depending upon the amount invested. 5 According to Sylvia Magnaye, a foundation teller, all deposits maturing in August 1989 were to be tripled. For such deposits, the slots issued were colored yellow to signify that the depositor would have his deposit tripled. Deposits that would mature subsequent to August were only given double the amount deposited. 6 However, there were times when it was the depositor who would choose that his deposit be tripled, in which case, the deposit would mature later 7.

The amounts received by the foundation were deposited in banks. Thus, a foundation teller would, from time to time, go to PNB, PCI Bank, DBP and the Rural Bank of Coron to deposit the collections in a joint account in the names of Priscilla Balasa and Norma Francisco.

Initially, the operation started with a few depositors, with most depositors investing small amounts to see whether the foundation would make good on its promise. When the foundation paid double or triple the amounts of their investment at maturity, most not only reinvested their earnings but even added to their initial investments. As word got around that deposits could be doubled within 21 days, or tripled if the period lasted for more than 30 days, more depositors were attracted. Blinded by the prospect of gaining substantial profits for nothing more than a minuscule investment, these investors, like previous ones, were lured to reinvest their earnings, if not to invest more.

Most would invest more than P5,000.00, the investment limit set by the foundation. Priscilla Balasa would, however, encourage depositors to invest more than P5,000.00, provided that the excess was deposited under the name of others. She assured the depositors that this was safe because as long as the depositor was holding the slots, he was the "owner" of the amount deposited. Most investors then deposited amounts in the names of their relatives.

At the outset, the foundation's operations proceeded smoothly, as satisfied investors collected their investments upon maturity. On November 29, 1989, however, the foundation did not open. Depositors whose investments were to mature on said date demanded payments but none was forthcoming. On December 2, 1989, Priscilla Balasa announced that since the foundation's money had been invested in the stock market, it would resume operations on December 4, 1989. On that date, the foundation remained closed. Depositors began to demand reimbursement of their deposits, but the foundation was unable to deliver.

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Consequently, sixty-four informations, all charging the offense of estafa, as defined in Presidential Decree No. 1689, were filed against Priscilla Balasa, Normita Visaya, Norma Francisco, Guillermo Francisco, Analina Francisco and eight other persons, mostly incorporators and employees of the Panata Foundation, before the Regional Trial Court of Palawan. Fourteen cases, including Criminal Case Nos. 8429 and 8751, were raffled off to Branch 52. Two more cases, Criminal Case Nos. 8704 and 8749, were similarly assigned to it. Of the sixteen casts assigned to Branch 52, eight were, with the consent of the accused, provisionally dismissed for lack of evidence.

In Criminal Case No. 8429, the information charging the accused with the crime of estafa "as amended by PD 1689" was filed on December 12, 1989. The accused in this case were: Priscilla Balasa, Almarino Agayo, Norma Francisco, Normita Visaya, Paul Francisco, Nelia Daco, Ruth Jalover, 8 Guillermo Francisco, Candido Tolentino, Jr., Rosemarie Balasa, 9 Ricardo del Rosario, Emelita Gabayan, Rosario Arciaga, Jessica Buaya, Avelina Yan, Anita Macmac, Gina Gabaldon, Ronaldo Belo, Fernando Cadauan, Lolita Gelilang, Cynthia Ang, Judith Ponciano, Sylvia Magnaye, 10 Analina Francisco and Sulpicio Nabayan. As Amended on February 16, 1990, the information in this case reads as follows:

That sometime on (sic) December, 1989, the above-named accused being the Manager and employees of the PANATA Foundation of the Philippines, Inc., with office at No. 20 Diaz Apartment, Manalo Extension, Puerto Princesa City, Philippines, and within the jurisdiction of this Honorable Court, the said accused conspiring and confederating with one another and operating as a syndicate, did then and there wilfully, unlawfully and feloniously defraud one Estrella San Gabriel y Lacao by means of false representation and fraudulent means which they made to said Estrella San Gabriel to the effect that as an investor/subscriber to the PANATA Foundation, Inc. which is a non-stock corporation allegedly registered with the SEC under Registration No. 165565 and by means of other similar deceit induce the said Estrella San Gabriel to give and deliver to the said accused the amount of P5,500.00 as her investment in said foundation, and by manifestation and misrepresentation by the said accused that the said invested amount will be doubled or tripled within a certain period of days said accused knowing fully well that their manifestation and representations were false and fraudulent as they are made only for the purpose of obtaining as in fact they obtained the amount with intent to defraud misapply, misappropriate and convert the said amount for their own personal use and benefit, to the damage and prejudice of said Estrella San Gabriel in the amount of P5,500.00, Philippine Currency.

CONTRARY TO LAW and penalized under Presidential Decree No. 1689.

Likewise, in Criminal Case No. 8704, the information, filed on May 23, 1990, charged Priscilla Balasa, Norma Francisco, Guillermo Francisco, Normita Visaya, Analina Francisco, Lolita Gelilang, Cynthia Ang, Rodolfo Ang, Jr., Purable Espidol, Melinda Mercado, Almarino Agayo, Candido Tolentino, Jr., Ricardo del Rosario, Fernando Caduan, Paul Francisco and Teresita Carandang with the crime of estafa "as amended by Presidential Decree No. 1689" as follows:

That sometime in July, 1989 to December 1989, the above-named accused being then the Manager incorporators, members of the board of trustees, officers and employees of the PANATA FOUNDATION OF THE PHIL., INC. with Office No. 20 Diaz Apartment, Manalo Extension, Puerto Princess City, Philippines and within the jurisdiction of this Honorable Court, the said accused conspiring, confederating together and mutually helping one another, and operating as a syndicate, did then and there wilfully, unlawfully and feloniously defraud, the complainant Conchita Bigornia, by means of false

pretenses/representation and fraudulent means which they made to said Conchita Bigornia to the effect that as depositor/subscriber to the PANATA FOUNDATION OF THE PHIL., INC., which is a non-stock corporation allegedly registered with the SEC under Registration No. 165565 and by means of other similar deceit induce the said Conchita Bigornia, to give and deliver to the said accused the amount of TWENTY FOUR THOUSAND ONE HUNDRED (P24,100.00) PESOS, Philippine Currency, as his/her deposit/subscription in said Foundation, and by manifestation and misrepresentation by the said accused that the said deposited/subscription amount will be doubled or tripled within a certain period of days said accused knowing fully well that this manifestation were (sic) false and fraudulent as they are made only for the purpose of obtaining as in fact they obtained the amount of TWENTY FOUR THOUSAND ONE HUNDRED PESOS (P24,100.00) from the said (Conchita Bigornia) and the said accused once in possession of the said amount with intent to defraud, misapply, misappropriate and convert the said amount for their own personal use and benefit, to the damage and prejudice of the said Conchita Bigornia in the amount aforestated.

CONTRARY TO LAW and penalized under P.D. No. 1689.

Similar informations were filed against the same persons in Criminal Cases Nos. 8749 and 8751. The complainant in Criminal Case No. 8749, complainant Shiela San Juan, was allegedly defrauded of P25,800.00 while in Criminal Case No. 8751, the amount of P6,800.00 was allegedly defrauded from Benjamin Yangco.

In like manner, similarly worded informations in Criminal Case Nos. 8734 and 8428, raffled off to Branch 50, alleged that Elisia Mensias was defrauded in the amount of P4,500.00 and Alfonso and Prescilla Lacao defrauded in the amount of P58,850.00, respectively.

After the filing of the informations, warrants for the arrest of the defendants in the corresponding criminal cases were issued. However, only Priscilla Balasa, Normita Visaya, Guillermo Francisco, Norma Francisco and Analina Francisco were arrested, the rest of the defendants having gone into hiding.

On arraignment, the arrested defendants all pleaded not guilty to the crimes charged but before the presentation of prosecution evidence, Priscilla Balasa and Normita Visaya escaped from police custody. With their escape, only the spouses Guillermo and Norma Francisco were called to present evidence on behalf of the defense. Analina Francisco, being a deaf-mute, was not called to the witness stand due to the lack of a competent interpreter. The spouses, in denying criminal liability, presented the following facts:

Priscilla Balasa, Normita Visaya, and Analina Francisco, full-blooded sisters, are the common children of appellant spouses Guillermo and Norma Francisco. Before the Panata Foundation started operations in July 1989, Priscilla had been living with her parents in San Mateo, Isabela. Analina, on the other hand, was living with their elder sister, Normita, in Manila. Priscilla, however, left for Palawan in June 1989.

Sometime thereafter, Guillermo Francisco received a letter from Priscilla asking him to come to Palawan to provide her company, the latter's husband having left for abroad as a seaman. Consequently, Francisco came to Palawan sometime in August 1989 to live with Priscilla at the Diaz

CRIM CASES 59

Apartment in Puerto Princesa. Norma Francisco also came to Palawan in August, purportedly to visit Priscilla's daughter, whom she missed. Analina likewise came to Palawan from Manila in August.

Guillermo denies participation in the commission of the crime charged. In his testimony, he limits his participation in the foundation's activities to paying the holders of matured slots. It was the comptroller, Ruth Jalover, who would give him the record on which to base the remittances he would make. 11 The money he disbursed was not always in his possession, as it would have to come from the bank. It was Sylvia Magnaye who would withdraw the money from the bank while it was Nelia Daco who would directly receive money from the people. Thus, not even once did he participate in the process of receiving money. His daughters Priscilla Balasa and Normita Visaya performed other jobs in the operation of the foundation while his other daughter, Analina Francisco, only typed documents. He knew that the foundation helped people who received money from it. 12 Although the primary purpose of the foundation was to help the needy, Guillermo testified having knowledge of only one recipient thereof, the church of Aborlan.

In her testimony, Norma Francisco also denied complicity in the crime charged, claiming that she only did household chores in Puerto Princesa. She alleged that sometimes, she would "help the tellers." However, because Ruth Jalover was educated and she was not, the former would sometimes become the "acting manager of her daughter." Sylvia Magnaye, her daughter's sister-in-law and a permanent employee of the foundation, was one of the tellers who would deposit and withdraw from the bank. The eight tellers of the foundation all applied for their jobs with Priscilla but it was Normita who interviewed them. However, Normita was only a clerk in the foundation while Analina would type whatever work Ruth Jalover would give her. While Norma had no official position in the foundation, her husband, Guillermo, was the paymaster. During her stay in Puerto Princesa, she knew of no other business that her daughter Priscilla was engaged in except the foundation and a paluwagan, which she ran together with a certain Manny Diaz. Norma knew that the foundation was a charitable institution that had helped a lot of people. She did not help Ruth Jalover in the same way that she helped Sylvia Magnaye with her job as teller, but she had nothing to do with the keeping of records. She knew that money came from the tellers, who got the money from Nelia Daco, the one receiving money from prospective investors. 13

On March 31, 1992, Branch 50 of the Regional Trial Court of Palawan issued a joint decision in Criminal Case Nos. 8734 and 8428 finding the accused guilty of the crime charged and of having acted in conspiracy in committing the same. Finding no aggravating or mitigating circumstances in the commission of the crime, the trial court decreed thus:

WHEREFORE AND IN VIEW OF THE FOREGOING CONSIDERATIONS, judgment is hereby rendered finding all the accused in the 2 above-entitled cases guilty as principals of the crime of estafa as the same is defined and penalized under the Revised Penal Code.

a. In Criminal Case No. 8428 accused Priscilla Balasa, Normita Visaya, Analina Francisco, Guillermo Francisco and Norma Francisco are hereby sentenced to suffer the penalty of reclusion perpetua as well as to pay the costs. The accused are jointly and severally ordered to pay the offended party Alfonso Lacao the sum of Fifty Eight Thousand Eight Hundred Fifty (P58,850.00) Pesos and to pay the further sum of Thirty Thousand Pesos (P30,000.00) as and for moral damages;

b. In Criminal Case No. 8734, accused Normita Visaya, Analina Francisco, Norma Francisco and Guillermo Francisco are hereby sentenced to suffer the penalty of reclusion perpetua as well as to pay the costs. They are furthermore ordered jointly and severally to indemnify the offended party Elisea Mensias the sum of Four Thousand Five Hundred (P4,500.00) Pesos as well as to pay the additional sum of Fifteen Thousand (P15,000.00) Pesos as and for moral damages.

The cases against the accused Almarino Agayo, Paul Francisco, Candido Tolentino, Jr., Ricardo del Rosario, Jessica Buaya, Fernando Cadauan, Lolita Gelilang Cynthia Ang, Rodolfo Ang Jr., Purable Espidol, Melinda Mercado, and Teresit Carandang who remained at large up to the present time are hereby ordered archived to be reinstated in the docket of this Court as soon they shall have been arrested or surrendered voluntarily to the jurisdiction of this Court.

SO ORDERED.

On the other hand, Branch 52 rendered separate decisions in the cases assigned to it. Thus, on October 14, 1991, the trial court in Criminal Case No. 8429 rendered a decision, the dispositive portion of which reads as follows:

WHEREFORE, premises considered, judgment is hereby rendered finding co-accused PRISCILLA BALASA, NORMITA VISAYA, GULLLERMO FRANCISCO, and NORMA FRANCISCO guilty beyond reasonable doubt as co-principals of the crime of estafa committed by a syndicate in violation of Section 1 of Presidential Decree No. 1689, and each of the aforenamed accused is sentenced to reclusion perpetua; to pay to Estrella Lacao San Gabriel, jointly and severally, by way of restitution, the sum of P5,500.00.00, with interest thereon of 12% per annum from December, 1989, until fully paid; and to pay the costs.

On grounds of reasonable doubt engendered by lack of sufficiently clear and convincing evidence as against her, co-accused Analina Francisco is acquitted of the offense charged.

SO ORDERED.

Although Branch 52 rendered separate decisions in the cases assigned to it, all had essentially the same disposition — imposing the penalty of reclusion perpetua upon each of the convicted accused — only the name of the offended party and the amount to be restituted varied. Thus, in Criminal Case No.8704, 14 the trial court ordered the accused to pay Conchita Bigornia by way of restitution, the amount of P24,200.00 with interest thereon of 12% per annum from December 1989. In Criminal Case No. 8749, 15 the same convicted accused were ordered to restitute Shiela San Juan the amount of P25,800.00 plus 12% per annum from December 1989. In Criminal Case No. 8751, 16 the convicted accused were ordered to restitute Benjamin Yangco the amount of P6,800.00 with 12% interest per annum from December 1989.

Guillermo and Norma Francisco filed notices of appeal in Criminal Case Nos. 8429, 8704, 8749 and 8751. Their appeal was docketed as G.R. No. 106357. Likewise, the joint decision in Criminal Case Nos. 8734 and 8428 was appealed to this Court by Guillermo Francisco, Norma Francisco, Analina Francisco, and Normita Visaya, docketed herein as G.R. Nos. 108601-02. Noting Normita Visaya's

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escape from police custody after arraignment, the Court, on August 15, 1994, and pursuant to Section 8, Rule 124 of the Revised Rules of Court, ordered the dismissal of her appeal on the ground of abandonment. The Court also considered Priscilla Balasa's conviction to be final and executory, in light of her escape from police custody. It also ordered the issuance of a warrant for the arrest of Normita Visaya and an alias warrant of arrest against Priscilla Balasa.

On October 16, 1993, appellants' counsel, Atty. Agustin Rocamora, filed an appellants' brief in G.R. No. 106357. Thereafter, appellants appointed the Maramba and Mamauag Law Office as new counsel in substitution of Atty. Rocamora. On November 2, 1994, new counsel filed a motion to consolidate G.R. No. 106357 and G.R. Nos. 108601-02. On December 7, 1994, the Court granted the motion and ordered the consolidation of the two cases. On the same day, counsel for appellants submitted a consolidated appellants' brief.

In G.R. No. 106357, counsel for appellants raise the following errors:

1. The trial court erred in convicting the appellants despite the total absence of evidence against them;

2. The trial court erred in ruling that conspiracy existed on the basis of the relationship of the appellants to the principal accused; and

3. The trial court erred in convicting appellants despite their prior conviction for the same offense in Criminal Case No. 8429.

On the other hand, the brief filed by appellants in the consolidated cases mainly argues that they cannot be convicted of the defined in Presidential Decree No. 1689 because the informations filed against them alleged prejudice against the complaining witnesses, not against the national, provincial, or city economy nor was evidence presented therefor.

Appellants' conviction must, however, be sustained, the issues raised being devoid of merit. The number and diversity of issues raised by appellants impel us to discuss the points raised seriatim.

For the first assignment of error, we hold that the elements of the crime defined and penalized by P.D. No. 1689 have been proven beyond reasonable doubt in these appealed cases. The informations filed against appellants alleged that by means of false representation or false pretenses and through fraudulent means, complainants were defrauded of various amounts of money by the accused. Article 315, paragraph 2 (a) of the Revised Penal Code provides that swindling or estafa by false pretenses or fraudulent acts executed prior to or simultaneously with the commission of the fraud is committed by "using fictitious name, or falsely pretending to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions, or by other similar deceits." The elements of estafa under this penal provision are: (1) the accused defrauded another by means of deceit and (2) damage or prejudice capable of pecuniary estimation is caused to the offended party or third party. 17 It is indisputable that the foundation failed to return the investments of the complaining witnesses, hence it is undeniable that the complainants suffered damage in the amount of their unrecouped investments. What needs elucidation is whether or not the element of defraudation by means of deceit has been established beyond reasonable doubt.

Fraud, in its general sense, is deemed to comprise anything calculated to deceive, including all acts, omissions, and concealment involving a breach of legal or equitable duty, trust, or confidence justly reposed, resulting in damage to another, or by which an undue and unconscientious advantage is taken of another. 18 It is a generic term embracing all multifarious means which human ingenuity can device, and which are resorted to by one individual to secure an advantage over another by false suggestions or by suppression of truth and includes all surprise, trick, cunning, dissembling and any unfair way by which another is cheated. 19 On the other hand, deceit is the false representation of a matter of fact whether by words or conduct, by false or misleading allegations, or by concealment of that which should have been disclosed which deceives or is intended to deceive another so that he shall act upon it to his legal injury. 20

In pursuit of their agenda, appellants established a foundation which, by its articles of incorporation, was established, allegedly to "uplift members' economic condition by way of financial or consultative basis." Organized as a non-stock, non-profit charitable institution, its funds were to be obtained through membership dues and such other assessments as may be agreed upon by its board of directors. 21 Furthermore, the modus operandi 22 of the foundation, duly signed by Priscilla Balasa, provided that:

Funding

Any funding requirements to finance the operation of the association shall be done through the collection of membership fees, dues, donations, bequests and other assessments. The amount of which shall be subject to the approval of the general membership of the association.

Likewise, all funds in-flows would be used exclusively to carry out the purposes for which the FOUNDATION is established and would not inure to the benefit of any single member of the FOUNDATION.

The operations personnel shall come from volunteers among its members and should the need arise, hiring of additional personnel be resorted to.

In contravention of these by-laws and modus operandi, the people behind the foundation enticed people to "deposit or invest" funds in the foundation under a "double or treble your deposit" scheme. These investment activities were clearly ultra vires acts or acts beyond the foundation's authority. Evidently, SEC registration was obtained only for the purpose of giving a semblance of legitimacy to the foundation; that the foundation's business was sanctioned by the government; and that it was allowed by law to accept deposits. This pretension was carried out even on the slots it issued, the foundations' S.E.C. registry number being indicated thereon.

In carrying out the charade, the manager went to the extent of delivering a speech and personally encouraging people to deposit or invest in the foundation. Alfonso Lacao, a complainant and prosecution witness, testified:

Q: Have you heard of this so called Panata Foundation?

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A: Yes, ma'm I heard it from my friends who are talking about this Panata Foundation they even informed me that the manager of this Panata Foundation is calling for a meeting for all depositors and prospective depositors on Saturday afternoon.

Q: With that information did you get interested in the proposed meeting being called by this Panata Foundation?

A: I was curious and came Saturday I went to the office of the Panata Foundation to attend the meeting.

Q: And at that time where was this office located?

A: At Diaz Apartment, Manalo Extension, Puerto Princesa City.

Q: Did you attend that meeting?

A: Yes ma'am.

Q: Whom did you see sponsoring that meeting on that particular day?

A: Upon arrival I saw a woman delivering her message to the depositors and to the prospective depositors. I asked a friend of me (sic) who is that woman and he informed me that she is the manager of the Panata Foundation Priscilla Balasa.

xxx xxx xxx

Q: What was Priscilla Balasa doing if any in that particular meeting?

A: In her message she was convincing all the people there to make their deposit to the Panata Foundation because according to her they were sent here to help the people of Puerto Princesa City and the people of Palawan.

Q: Aside from that what did Priscilla Balasa tell those people who attended the meeting?

A: She was assuring the people that they must not be afraid to deposit their money because they will not be fooling around with them.

xxx xxx xxx

Q: And did Priscilla Balasa tell those persons attending the meeting what would happen with the money they will deposit with the Panata Foundation?

A: She was telling the people that you could deposit the money and it will be doubled within 21 days. I was further informed that the maximum amount to be deposited is P5,000,00.

Q: You stated a while ago that the amount deposited will be doubled after 21 days?

A: Yes ma'am.

Q: Aside from that what else if any did Priscilla Balasa tell the public who attended that meeting?

A: She was telling the public to make ease with their deposit because they were sent here to help the people of Puerto Princesa City and Palawan.

Q: Did she tell the public as to where the money would be coming from?

A: Right that moment she was not able to tell the public. 23

On cross-examination, Mr. Lacao testified:

Q: But did it not occur to your mind considering your past experience to investigate or cause the investigation of this Panata Foundation considering your connection as to whether they are in a position to make double your money investment specially so they are not engage (sic) in business, so to speak?

A: Once I overheard the manager say when she was there telling the people around the depositors that their money is being invested in a world bank. 24

Priscilla Balasa, thus, promised the credulous public quick financial gains on their investments. The foundation even printed brochures proclaiming the merits of the foundation's investment scheme. 25 Likewise, to bolster the illusion that indeed, the foundation was legitimate, the claim was made that deposits would be invested abroad in a world bank, with said transactions allegedly enabling the foundation to double or treble depositors' investments. The evidence, however, proves the contrary. Sylvia Magnaye, one of the tellers, testified:

Q: Other than to issue slots, do you know what other phase of operation in running the Panata Foundation during the time that you were employed?

A: No sir, I can only observe that issuing of slots.

Q: Madam Witness, aside from issuing slots, there is only the activity of the foundation that you are well aware of?

A: Sometimes they also sent me to deposit.

Q: The deposit of the amount collected in the bank, is that correct?

A: I do not know but they just send me to deposit amounts.

Q: But you do not know in what other business activity other than the matter of collecting money and issuance of slots you do not know if the Panata Foundation is involved in any business activity?

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A: Yes, sir.

Q: You do not know whether the foundation receives money regularly from any other source?

A: I do not know sir. 26

On cross-examination, she testified:

Q: You mentioned Madam Witness, that on several occasions you were asked to deposit certain amounts in the bank, do you remember having told the Court that?

A: Right, sir.

Q: Do you remember how many banks these deposited amounts were if you remember?

A: I deposited at PNB, PCIBank, and DBP and Rural Bank of Coron.

Q: Do you remember in whose names you deposited these amounts you deposited?

A: In the name of the joint account of Priscilla Balasa and Norma Francisco. 27

The testimonial evidence presented by the prosecution proves that appellants employed fraud and deceit upon gullible people to convince them to invest in the foundation. It has been held that where one states that the future profits or income of an enterprise shall be a certain sum, but he actually knows that there will be none, or that they will be substantially less than he represents, the statement constitutes actionable fraud where the hearer believes him and relies on the statement to his injury. 28 That there was no profit forthcoming can be clearly deduced from the fact that the foundation was not engaged nor authorized to engage in any lucrative business to finance its operation. It was not shown that it was the recipient of donations or bequest with which to finance its "double or triple your money" scheme, nor did it have any operating capital to speak of when it started operations.

Parenthetically, what appellants offered the public was a "Ponzi scheme," an investment program that offers impossibly high returns and pays these returns to early investors out of the capital contributed by later investors. 29 Named after Charles Ponzi who promoted the scheme in the 1920s, the original scheme involved the issuance of bonds which offered 50% interest in 45 days or a 100% profit if held for 90 days. Basically, Ponzi used the money he received from later investors to pay extravagant rates of return to early investors, thereby inducing more investors to place their money with him in the false hope of realizing this same extravagant rate of return themselves. This was the very same scheme practiced by the Panata Foundation.

However, the Ponzi scheme works only as long as there is an ever-increasing number of new investors joining the scheme. To pay off the 50% bonds Ponzi had to come up with a one-and-a-half times increase with each round. To pay 100% profit he had to double the number of investors at each stage, and this is the reason why a Ponzi scheme is a scheme and not an investment strategy. The progression it depends upon is unsustainable. The pattern of increase in the number of participants in the system

explains how it is able to succeed in the short run and, at the same time, why it must fail in the long run. This game is difficult to sustain over a long period of time because to continue paying the promised profits to early investors, the operator needs an ever larger pool of later investors. 30 The idea behind this type of swindle is that the "con-man" collects his money from his second or third round of investors and then absconds before anyone else shows up to collect. Necessarily, these schemes only last weeks, or months at most. 31

Note should also be taken of the fact that appellants used "slots" in their operation. These slots are actually securities, 32 the issuance of which needs the approval of the Securities and Exchange Commission. Knowing fully well that the S.E.C. would not approve the issuance of securities by a non-stock, non-profit organization, the operators of the Ponzi scheme, nevertheless, applied for registration as a foundation, an entity not allowed to engage in securities.

Finally, if the foundation were indeed legitimate, the incorporators, outside of the members of the Francisco family, would not have escaped from the clutches of the law. If the foundation and its investment scheme were legal, then it behooved them to come out and testify for their own exoneration. The wicked flee when no man pursueth: but the righteous are bold as a lion. 33

In their defense, appellants would shift the blame on the investors. Invoking the legal principle of caveat emptor, they maintain that it was the investors' own greed that did them in, implying that the depositors should have known that no sensible business could afford to pay such extravagant returns. Having investigated the foundation and its activities, the investors should fault themselves, not the appellants, for investing in the foundation despite the patent impossibility of its claims.

The contention is untenable. The fact that the buyer makes an independent investigation or inspection has been held not to preclude him from relying on the representation made by the seller where the seller has superior knowledge and the falsity of such representation would not be apparent from such examination or inspection, and, a fortiori, where the efforts of a buyer to learn the true profits or income of a business or property are thwarted by some device of the seller, such efforts have been held not to preclude a recovery. 34 It has often been held that the buyer of a business or property is entitled to rely on the seller's statements concerning its profits, income or rents. The rule — that where a speaker has knowingly and deliberately made a statement concerning a fact the falsity of which is not apparent to the hearer, and has thus accomplished a fraudulent result, he cannot defend against the fraud by proving that the victim was negligent in failing to discover the falsity of the statement — is said to be peculiarly applicable where the owner of the property or a business intentionally makes a false statement concerning its rents, profits or income. The doctrine of caveat emptor has been held not to apply to such a case. 35

The second assignment of error is likewise devoid of merit. Appellants deny the existence of a conspiracy in the perpetration of the fraudulent scheme, charging that mere relationship does not prove conspiracy. Guillermo Francisco further maintains that he was not even an incorporator of the foundation.

The evidence adduced by the prosecution confirms the existence of a conspiracy among the appellants in committing the crime charged. The fact that Guillermo Francisco was not an incorporator of the foundation does not make him any less liable for the crime charged. By his own admission, he

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participated in the foundation's activities by serving as its paymaster. Because he is father and husband to three of the organizers of the foundation, it is not farfetched to presume that he was aware of its operations. By his active cooperation, he showed a community of design with the incorporators of the foundation, thereby making him a co-conspirator and equally liable for the crime charged. His voluntary and indispensable cooperation was a concatenation of the criminal acts performed by his co-accused. 36 In this regard, appellant Guillermo Francisco is not being implicated as a co-conspirator solely because he is the father of the principal proponent of the Ponzi scheme. He is held liable as a conspirator because of his indispensable act of being the paymaster of the foundation.

Likewise, Norma Francisco's bare denial cannot exempt her from complicity. Denials of an accused cannot be accorded greater evidentiary weight than the positive declarations of credible witnesses who testify on affirmative matters. 37 Moreover, her efforts to show that she was a mere housewife who simply helped in her daughter's "business" is refuted by the prosecution witnesses. Ruth Jalover testified:

Q: Madam Witness, do you know a person by the name of Norma Francisco?

A: Yes sir.

Q: And how did you come to Know her Madam Witness?

A: She is my co-employee at the Panata Foundation sir.

Q: What was her job in the Panata Foundation?

A: She was the one who received the money from our tellers every afternoon. 38

Sylvia Magnaye, on the other hand, testified:

Q: Madam Witness, do you know a person by the name of Norma Francisco?

A: Yes sir.

Q: How did you come to know her Madam Witness?

A: She is our former cashier sir.

Q: In the Panata Foundation?

A: Yes sir. 39

On cross-examination, she further testified:

Q: Now, I would like to direct your attention also to the other accused, Norma Francisco. You stated that she is your cashier, do you remember having done that?

A: Yes sir.

Q: When you say she is the cashier, do you mean to say that she is the one who pays out money or amounts to the employees Madam Witness?

A: Yes sir. 40

Aside from being the cashier, Norma Francisco was also an incorporator of the foundation. Likewise, the money invested in the foundation was deposited in joint bank accounts in Priscilla Balasa's name and hers. Norma Francisco's activities would thus show a community of design with the other accused making her a co-conspirator and equally liable for the crime charged. Her voluntary and indispensable cooperation concurred with the criminal acts performed by her co-accused.

As for Analina Francisco, however, the evidence adduced as to her complicity in the nefarious scheme is far from conclusive. While she was an incorporator and treasurer of the foundation, there is no denying the fact that she is a deaf-mute. As such, she is incapable of communicating and conveying her thoughts to the complaining witnesses and other depositors. This casts serious doubt on whether she could be deemed to have similarly conspired and confederated with the other accused. As Branch 52 pointed out, on paper she might have been in the thick of the foundation's operation — being an incorporator and treasurer. We are not, however, convinced that she was actually involved in the sinister scheme. In fact, she was given the manual task of typing papers, despite her being the treasurer of the foundation. Her disability might have been the principal reason for giving her that job — she was literally deaf and mute to the nefarious activities going on in the foundation that she did not pose a danger to it. Furthermore, it is well settled that where the acts of an accused are capable of two interpretations, that which is in consonance with innocence should prevail.

With respect to the third assignment of error, appellants cannot raise the defense of double jeopardy for which the following requisites must concur: (1) a first jeopardy must have attached prior to the second; (2) the first jeopardy must have been validly terminated; (3) the second jeopardy must be for the same offense, or the second offense includes or is necessarily included in the offense charged in the first information, or is an attempt to commit the same or a frustration thereof. 41 In the instant case, the offense charged in Criminal Case No. 8429 is different from the offense charged in the other cases. While these cases arose out of the same scheme, the fraudulent acts charged were committed against different persons, hence they do not constitute the same offense.

Lastly, appellants assert that they cannot be convicted under P.D. No. 1689. They contend that the following requisites must concur for conviction under P.D. No. 1689: (1) that estafa is committed under Articles 315 or 316 of the Revised Penal Code; (2) by a syndication of five or more persons; (3) against a) stockholders or members of rural banks, cooperatives, or samahang nayon; b) corporations or associations the funds of which are solicited from the general public; and (4) such defraudation erodes the confidence of the public in the banking and cooperative systems, contravenes public interest, and (5) constitutes economic sabotage that threatens the stability of the nation. 42

In support of their argument, appellants point out that there could not have been economic sabotage under the facts of the case because the total amount of P125,400.00 allegedly embezzled "by the other accused (not herein appellants)," did not weaken or threaten national economic stability. To emphasize

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that point, appellants enumerate the revenue collections of Palawan and Puerto Princesa City, "for dearth of a better reference," from 1987 to 1992 showing that the revenue collections for 1989 alone amounted to P75,002,499,19. Appellants assert that as compared to such revenue collection in 1989, the amount allegedly embezzled was negligible. As such, the crime committed in this case was not of the same genre as the "Agrix" and "Dewey Dee" scams that "spurred the birth of P.D. No. 1689. 43

Appellants, in a desperate attempt to avoid conviction, grasp at straws. The law upon which appellants have been charged and convicted reads as follows:

PRESIDENTIAL DECREE NO. 1689

INCREASING THE PENALTY FOR CERTAIN FORMS OF

SWINDLING OR ESTAFA.

WHEREAS, there is an upsurge in the commission of swindling and other forms of frauds in rural banks, cooperatives, "samahang nayon(s)", and farmers' associations or corporations/associations operating on funds solicited from the general public;

WHEREAS, such defraudation or misappropriation of funds contributed by stockholders or members of such rural banks, cooperatives, "samahang nayon(s)", or farmers' associations, or of funds solicited by corporations/associations from the general public, erodes the confidence of the public in the banking and cooperative system, contravenes the public interest, and constitutes economic sabotage that threatens the stability of the nation;

WHEREAS, it is imperative that the resurgence of said crimes be checked, or at least minimized, by imposing capital punishment on certain forms of swindling and other frauds involving rural banks, cooperatives, "samahang nayon(s)", farmers' associations or corporations/associations operating on funds solicited from the general public;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution, do hereby decree and order as follows:

Sec. 1. Any person or persons who shall commit estafa or other forms of swindling as defined in Article 315 and 316 of the Revised penal Code, as amended, shall be punished by life imprisonment to death if the swindling (estafa) is committed by a syndicate consisting of five or more persons formed with the intention of carrying out the unlawful or illegal act, transaction, enterprise or scheme, and the defraudation results in the misappropriation of moneys contributed by stockholders, or members of rural banks, cooperatives, "samahang nayon(s)", or farmers associations, or of funds solicited by corporations/associations from the general public.

When not committed by a syndicate as above defined, the penalty imposable shall be reclusion temporal to reclusion perpetua if the amount of the fraud exceeds 100,000 pesos.

Sec. 2. This decree shall take effect immediately.

DONE in Manila, Philippines, this 6th day of April, in the year of Our Lord, nineteen hundred and eighty.

Under this law, the elements of the crime are: (a) estafa or other forms of swindling as defined in Articles 315 and 316 of the Revised Penal Code is committed; (b) the estafa or swindling is committed by a syndicate, and (c) defraudation results in the misappropriation of moneys contributed by stockholders, or members of rural banks, cooperatives, "samahang nayon(s)," or farmers associations, or of funds solicited by corporations/associations from the general public. These are the only elements of the crime under Section 1 of the decree. The two other "ingredients" added by appellants to constitute the crime of economic sabotage under P.D. No. 1689 have been taken from the "whereas" clause or preamble of the law. A preamble is not exactly an essential part of an act as it is an introductory or preparatory clause that explains the reasons for the enactment, usually introduced by the word "whereas." 44 In People v.Purisima, 45 we explained that the preamble serves as the key to the intent and spirit of the decree. It enumerates the facts or events justifying the promulgation of the decree. It enumerate the fact or events justifying the promulgation of the decree and the sanctions for the acts prohibited therein. As such, although it is an aid in interpretation, the preamble of an act or decree is not the law subject thereof. Appellants' novel theory must, therefore, be given short shrift by this Court.

Assuming arguendo that the preamble was part of the statute, appellants' contention that they should not be held criminally liable because it was not proven that their acts constituted economic sabotage threatening the stability of the nation remains too flimsy for extensive discussion. As the preamble of P.D. No. 1689 shows, the act prohibited therein need not necessarily threaten the stability of the nation. It is sufficient that it "contravenes public interest." Public interest was affected by the solicitation of deposits under a promise of substantial profits, as it was people coming from the lower income brackets who were victimized by the illegal scheme.

Similarly, the fact that the entity involved was not a rural bank, cooperative, samahang nayon or farmers' association does not take the case out of the coverage of P.D. No. 1689. Its third "whereas clause" states that it also applies to other "corporations/associations operating on funds solicited from the general public." The foundation fits into these category as it "operated on funds solicited from the general public." To construe the law otherwise would sanction the proliferation of minor-league schemers who operate in the countryside. To allow these crimes to go unabated could spell disaster for people from the lower income bracket, the primary target of swindlers.

Again, P.D. No. 1689 penalizes offenders with life imprisonment to death regardless of the amount involved, provided that a syndicate committed the crime. A syndicate is defined in the same law as "consisting of five or more persons formed with the intention of carrying out the unlawful or illegal act, transaction, enterprise or scheme." If the offenders are not members of a syndicate, they shall nevertheless be held liable for the acts prohibited by the law but they shall be penalized by reclusion temporal to reclusion perpetua if the amount of the fraud is more than one hundred thousand pesos (P100,000.00).

In the instant case, a syndicate perpetrated the Ponzi scheme. The evidence shows that at least five persons — Priscilla Balasa, Normita Visaya, Norma Francisco, Guillermo Francisco, and the other incorporators of the foundation — collaborated, confederated and mutually helped one another in directing the foundation's activities.

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In its decision in Criminal Case Nos. 8428 and 8734, Branch 50 found that the "accused numbering 5 who composed the Francisco Family together with others acted and operated as a syndicate as defined under P.D. No. 1689 and should be held liable therefor." 46 However, it imposed the penalty of reclusion perpetua, the penalty imposable under the second paragraph of Section 1 of P.D. No. 1689 — where the offenders are not members of a syndicate and the amount involved is more than P100,000.00. The existence of a syndicate having been proved, the crime falls under the first paragraph of Section 1 of P.D. No. 1689, with an imposable penalty of life imprisonment to death. Hence, the imposition of reclusion perpetua is incorrect. Given the absence of aggravating or mitigating circumstances, the lesser penalty, or life imprisonment, should have been meted out. 47

Branch 52, likewise, ruled that the accused committed the offense of estafa by a syndicate under P.D. No. 1689. Therefore appellants, due to the absence of mitigating or aggravating circumstances, should have been punished with life imprisonment. However, in the dispositive portion of its decision in the four cases assigned to it, Branch 52 imposed the penalty of reclusion perpetua instead.

The Court finds this an opportune time to restate that the penalties of life imprisonment and reclusion perpetua are not the same. Thus:

While "life imprisonment" may appear to be the English translation of reclusion perperua, in reality, it goes deeper than that. First, "life imprisonment" is invariably imposed for serious offenses penalized by special laws, while reclusion perpetua is prescribed under The Revised Penal Code. Second, "life imprisonment," unlike reclusion perpetua, does not carry with it any accessory penalty. Third, "life imprisonment" does not appear to have any definite extent or duration, while reclusion perpetua entails imprisonment for at least thirty (30) years after which the convict becomes eligible for pardon, although the maximum period thereof shall in no case exceed forty (40) years. 48

WHEREFORE, premises considered, the decisions appealed from are hereby AFFIRMED in so far as appellants GUILLERMO and NORMA FRANCISCO are convicted for violation of the first paragraph of Section 1 of Presidential Decree No. 1689 and ordered to restitute to complainants the amounts they have been defrauded, subject to the MODIFICATION that appellants GUILLERMO and NORMA FRANCISCO shall each suffer the penalty of life imprisonment for each violation of the same law under the corresponding criminal cases. Appellant ANALINA FRANCISCO is hereby ACQUITTED of the crimes charged under Criminal Case Nos. 8428 and 8734 on ground of reasonable doubt and her immediate release from custody is ordered unless she is being held on other legal grounds.

Let a copy of this Decision be furnished the Department of Justice and the Philippine National Police in order that the arrest of Priscilla Balasa, Normita Visaya and the others who have so far eluded the law shall be effected with dispatch.

SO ORDERED.

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G.R. No. 168852 September 30, 2008

SHARICA MARI L. GO-TAN, Petitioner, vs.SPOUSES PERFECTO C. TAN and JUANITA L. TAN, Respondents.*

D E C I S I O N

AUSTRIA-MARTINEZ, J.:

Before the Court is a Petition for Review on Certiorari under Rule 45 of the Rules of Court assailing the Resolution1 dated March 7, 2005 of the Regional Trial Court (RTC), Branch 94, Quezon City in Civil Case No. Q-05-54536 and the RTC Resolution2 dated July 11, 2005 which denied petitioner's Verified Motion for Reconsideration.

The factual background of the case:

On April 18, 1999, Sharica Mari L. Go-Tan (petitioner) and Steven L. Tan (Steven) were married.3 Out of this union, two female children were born, Kyra Danielle4 and Kristen Denise.5 On January 12, 2005, barely six years into the marriage, petitioner filed a Petition with Prayer for the Issuance of a Temporary Protective Order (TPO)6 against Steven and her parents-in-law, Spouses Perfecto C. Tan and Juanita L. Tan (respondents) before the RTC. She alleged that Steven, in conspiracy with respondents, were causing verbal, psychological and economic abuses upon her in violation of Section 5, paragraphs (e)(2)(3)(4), (h)(5), and (i)7 of Republic Act (R.A.) No. 9262,8 otherwise known as the "Anti-Violence Against Women and Their Children Act of 2004."

On January 25, 2005, the RTC issued an Order/Notice9 granting petitioner's prayer for a TPO.

On February 7, 2005, respondents filed a Motion to Dismiss with Opposition to the Issuance of Permanent Protection Order Ad Cautelam and Comment on the Petition,10 contending that the RTC lacked jurisdiction over their persons since, as parents-in-law of the petitioner, they were not covered by R.A. No. 9262.

On February 28, 2005, petitioner filed a Comment on Opposition11 to respondents' Motion to Dismiss arguing that respondents were covered by R.A. No. 9262 under a liberal interpretation thereof aimed at promoting the protection and safety of victims of violence.

On March 7, 2005, the RTC issued a Resolution12 dismissing the case as to respondents on the ground that, being the parents-in-law of the petitioner, they were not included/covered as respondents under R.A. No. 9262 under the well-known rule of law "expressio unius est exclusio alterius."13

On March 16, 2005, petitioner filed her Verified Motion for Reconsideration14 contending that the doctrine of necessary implication should be applied in the broader interests of substantial justice and due process.

On April 8, 2005, respondents filed their Comment on the Verified Motion for Reconsideration15 arguing that petitioner's liberal construction unduly broadened the provisions of R.A. No. 9262 since the relationship between the offender and the alleged victim was an essential condition for the application of R.A. No. 9262.

On July 11, 2005, the RTC issued a Resolution16 denying petitioner's

Verified Motion for Reconsideration. The RTC reasoned that to include respondents under the coverage of R.A. No. 9262 would be a strained interpretation of the provisions of the law.

Hence, the present petition on a pure question of law, to wit:

WHETHER OR NOT RESPONDENTS-SPOUSES PERFECTO & JUANITA, PARENTS-IN-LAW OF SHARICA, MAY BE INCLUDED IN THE PETITION FOR THE ISSUANCE OF A PROTECTIVE ORDER, IN ACCORDANCE WITH REPUBLIC ACT NO. 9262, OTHERWISE KNOWN AS THE "ANTI-VIOLENCE AGAINST WOMEN AND THEIR CHILDREN ACT OF 2004".17

Petitioner contends that R.A. No. 9262 must be understood in the light of the provisions of Section 47 of R.A. No. 9262 which explicitly provides for the suppletory application of the Revised Penal Code (RPC) and, accordingly, the provision on "conspiracy" under Article 8 of the RPC can be suppletorily applied to R.A. No. 9262; that Steven and respondents had community of design and purpose in tormenting her by giving her insufficient financial support; harassing and pressuring her to be ejected from the family home; and in repeatedly abusing her verbally, emotionally, mentally and physically; that respondents should be included as indispensable or necessary parties for complete resolution of the case.

On the other hand, respondents submit that they are not covered by R.A. No. 9262 since Section 3 thereof explicitly provides that the offender should be related to the victim only by marriage, a former marriage, or a dating or sexual relationship; that allegations on the conspiracy of respondents require a factual determination which cannot be done by this Court in a petition for review; that respondents cannot be characterized as indispensable or necessary parties, since their presence in the case is not only unnecessary but altogether illegal, considering the non-inclusion of in-laws as offenders under Section 3 of R.A. No. 9262.

The Court rules in favor of the petitioner.

Section 3 of R.A. No. 9262 defines ''[v]iolence against women and their children'' as "any act or a series of acts committed by any person against a woman who is his wife, former wife, or against a woman with whom the person has or had a sexual or dating relationship, or with whom he has a common child, or against her child whether legitimate or illegitimate, within or without the family abode, which result in or is likely to result in physical, sexual, psychological harm or suffering, or economic abuse including threats of such acts, battery, assault, coercion, harassment or arbitrary deprivation of liberty."

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While the said provision provides that the offender be related or connected to the victim by marriage, former marriage, or a sexual or dating relationship, it does not preclude the application of the principle of conspiracy under the RPC.

Indeed, Section 47 of R.A. No. 9262 expressly provides for the suppletory application of the RPC, thus:

SEC. 47. Suppletory Application. - For purposes of this Act, the Revised Penal Code and other applicable laws, shall have suppletory application. (Emphasis supplied)

Parenthetically, Article 10 of the RPC provides:

ART. 10. Offenses not subject to the provisions of this Code. – Offenses which are or in the future may be punishable under special laws are not subject to the provisions of this Code. This Code shall be supplementary to such laws, unless the latter should specially provide the contrary. (Emphasis supplied)

Hence, legal principles developed from the Penal Code may be applied in a supplementary capacity to crimes punished under special laws, such as R.A. No. 9262, in which the special law is silent on a particular matter.

Thus, in People v. Moreno,18 the Court applied suppletorily the provision on subsidiary penalty under Article 39 of the RPC to cases of violations of Act No. 3992, otherwise known as the "Revised Motor Vehicle Law," noting that the special law did not contain any provision that the defendant could be sentenced with subsidiary imprisonment in case of insolvency.

In People v. Li Wai Cheung,19 the Court applied suppletorily the rules on the service of sentences provided in Article 70 of the RPC in favor of the accused who was found guilty of multiple violations of R.A. No. 6425, otherwise known as the "Dangerous Drugs Act of 1972," considering the lack of similar rules under the special law.

In People v. Chowdury,20 the Court applied suppletorily Articles 17, 18 and 19 of the RPC to define the words "principal," "accomplices" and "accessories" under R.A. No. 8042, otherwise known as the "Migrant Workers and Overseas Filipinos Act of 1995," because said words were not defined therein, although the special law referred to the same terms in enumerating the persons liable for the crime of illegal recruitment.

In Yu v. People,21 the Court applied suppletorily the provisions on subsidiary imprisonment under Article 39 of the RPC to Batas Pambansa (B.P.) Blg. 22, otherwise known as the "Bouncing Checks Law," noting the absence of an express provision on subsidiary imprisonment in said special law.

Most recently, in Ladonga v. People,22 the Court applied suppletorily the principle of conspiracy under Article 8 of the RPC to B.P. Blg. 22 in the absence of a contrary provision therein.

With more reason, therefore, the principle of conspiracy under Article 8 of the RPC may be applied suppletorily to R.A. No. 9262 because of the express provision of Section 47 that the RPC shall be

supplementary to said law. Thus, general provisions of the RPC, which by their nature, are necessarily applicable, may be applied suppletorily.

Thus, the principle of conspiracy may be applied to R.A. No. 9262. For once conspiracy or action in concert to achieve a criminal design is shown, the act of one is the act of all the conspirators, and the precise extent or modality of participation of each of them becomes secondary, since all the conspirators are principals.23

It must be further noted that Section 5 of R.A. No. 9262 expressly recognizes that the acts of violence against women and their children may be committed by an offender through another, thus:

SEC. 5. Acts of Violence Against Women and Their Children. - The crime of violence against women and their children is committed through any of the following acts:

x x x

(h) Engaging in purposeful, knowing, or reckless conduct, personally or through another, that alarms or causes substantial emotional or psychological distress to the woman or her child. This shall include, but not be limited to, the following acts:

(1) Stalking or following the woman or her child in public or private places;

(2) Peering in the window or lingering outside the residence of the woman or her child;

(3) Entering or remaining in the dwelling or on the property of the woman or her child against her/his will;

(4) Destroying the property and personal belongings or inflicting harm to animals or pets of the woman or her child; and

(5) Engaging in any form of harassment or violence; x x x. (Emphasis supplied)

In addition, the protection order that may be issued for the purpose of preventing further acts of violence against the woman or her child may include

individuals other than the offending husband, thus:

SEC. 8. Protection Orders. – x x x The protection orders that may be issued under this Act shall include any, some or all of the following reliefs:

(a) Prohibition of the respondent from threatening to commit or committing, personally or through another, any of the acts mentioned in Section 5 of this Act; 1avvphi1.net

(b) Prohibition of the respondent from harassing, annoying, telephoning, contacting or otherwise communicating with the petitioner, directly or indirectly; x x x (Emphasis supplied)

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Finally, Section 4 of R.A. No. 9262 calls for a liberal construction of the law, thus:

SEC. 4. Construction. - This Act shall be liberally construed to promote the protection and safety of victims of violence against women and their children. (Emphasis supplied)

It bears mention that the intent of the statute is the law24 and that this intent must be effectuated by the courts. In the present case, the express language of R.A. No. 9262 reflects the intent of the legislature for liberal construction as will best ensure the attainment of the object of the law according to its true intent, meaning and spirit - the protection and safety of victims of violence against women and children.

Thus, contrary to the RTC's pronouncement, the maxim "expressio unios est exclusio alterius" finds no application here. It must be remembered that this maxim is only an "ancillary rule of statutory construction." It is not of universal application. Neither is it conclusive. It should be applied only as a means of discovering legislative intent which is not otherwise manifest and should not be permitted to defeat the plainly indicated purpose of the legislature.25

The Court notes that petitioner unnecessarily argues at great length on the attendance of circumstances evidencing the conspiracy or connivance of Steven and respondents to cause verbal, psychological and economic abuses upon her. However, conspiracy is an evidentiary matter which should be threshed out in a full-blown trial on the merits and cannot be determined in the present petition since this Court is not a trier of facts.26 It is thus premature for petitioner to argue evidentiary matters since this controversy is centered only on the determination of whether respondents may be included in a petition under R.A. No. 9262. The presence or absence of conspiracy can be best passed upon after a trial on the merits.

Considering the Court's ruling that the principle of conspiracy may be applied suppletorily to R.A. No. 9262, the Court will no longer delve on whether respondents may be considered indispensable or necessary parties. To do so would be an exercise in superfluity.

WHEREFORE, the instant petition is GRANTED. The assailed Resolutions dated March 7, 2005 and July 11, 2005 of the Regional Trial Court, Branch 94, Quezon City in Civil Case No. Q-05-54536 are hereby PARTLY REVERSED and SET ASIDE insofar as the dismissal of the petition against respondents is concerned.

SO ORDERED.