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[ G.R. No. 138895. August 30, 1999]

PILIPINAS BANK vs. HON. CA, et al.

SECOND DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this court dated AUG 30, 1999.

G.R. No. 138895 (Pilipinas Bank vs. The Hon. Court of Appeals, the Secretary of Justice, the Regional State Prosecutor of Region III, Alfredo T. Ong and Susana Ong.)

This is a petition for review on certiorari of the decision, dated October 30, 1998, of the Court of Appeals, affirming the dismissal of charges filed by petitioner Pilipinas Bank against private respondents Alfredo and Susana Ong for removal, sale, or pledge of mortgaged property, and against Alfredo Ong for perjury in violation of Arts. 319 and 183 of the Revise Penal Code.

In its complaint against private respondents, petitioner Pilipinas Bank alleged that on June 8, 1990, private respondents executed in its favor a chattel mortgage over lumber worth P126,831,535.00 to secure a loan in the amount of P20,000,000.00. However, without petitioner's knowledge, private respondents executed on June 23, 1990 another mortgage over the same lumber in favor of Boston Bank of the Philippines to secure a loan in the amount of P5,000,000.00, executing for this purpose an affidavit dated June 18, 1990, wherein private respondent Alfredo Ong falsely stated that the lumber was free from any lien and encumbrance.

In a resolution, dated June 5, 1995, the Provincial Prosecutor of Bulacan found probable cause against private respondents and ordered the filing of corresponding informations. However, Regional State Prosecutor Carlos de Leon directed the Provincial Prosecutor of bulacan to dismiss the charges against private respondents. On appeal, this action was upheld by then Secretary of Justice Teofisto Guingona. Petitioner brought the matter to the Court of Appeals but its petition was dismissed. Hence, this petition.

Petitioner raises the following assignments of error:

I. THE HONORABLE COURT OF APPEAL SERIOUSLY ERRED IN HOLDING, AS THERE IS NO LEGAL OR FACTUAL BASIS, THAT PRIVATE RESPONDENTS WERE AUTHORIZED BY PILIPINAS BANK TO CONSTITUTE ANOTHER CHATTEL MORTGAGE OVER THE SAME PROPERTIES.

II. THE HONORABLE COURT OF APPEAL LIKEWISE SERIOUSLY ERRED IN HOLDING THAT PRIVATE RESPONDENT ALFREDO ONG, WHO US THE PRESIDENT OF BALIWAG MAHOGANY CORPORATION, DID NOT UNDERSTAND THE PHRASE "FREE FROM LIEN AND ENCUMBRANCE."

III. CONSEQUENTLY, THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN DISMISSING THE CHARGES AGAINST THE PRIVATE RESPONDENTS ALFREDO AND SUSANA ONG.

The instant petition is without merit.

As pointed out by the Court of Appeals, the chattel mortgage executed by private respondents in favor of petitioner contained the following stipulation:

It is hereby agreed that the MORTGAGOR in pursuant to the ordinary course of business may dispose or sell any of the inventories/properties subject of this mortgage but is obliged to replace such inventories/properties with such number of similar or like description and value that said items which have been replaced by virtue of this authority is understood to be covered by this mortgage agreement.

Private respondents cannot be prosecuted under Art. 319 of the Revised Penal Code since the law penalizes the removal, sale, or pledge of mortgaged property without the consent of the first mortgagee. In this case, petitioner gave private respondents the right to execute another chattel mortgage over the same inventory of lumber under the stipulation quoted above.

The Court of Appeals also noted that the value of the lumber exceeded the amount of the indebtedness of private respondents to petitioner. Being a layman, private respondent Alfredo Ong may have thought that the chattel mortgage executed in favor of petitioner did not cover the entire inventory of lumber. Thus, he did not intend any falsehood in the affidavit which he executed in support of the second chattel mortgage in favor of Boston Bank of the Philippines in which he said that the inventory of lumber was free from any lien or encumbrance. Considering that Art. 183 of the Revised Penal Code penalizes the act of knowingly making untruthful statements under oath, the dismissal of the charge of perjury is sustainable on the ground of reasonable doubt.

WHEREFORE, the instant petition is DENIED for lack of showing that the Court of Appeals committed a reversible error.

Very truly yours,

(Sgd.) TOMASITA M. DRIS
Clerk of Court

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