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EN BANC

[G.R. No. 130140. October 25, 1999]

PRESIDENTIAL AD HOC FACT-FINDING COMMITTEE ON BEHEST LOANS represented by MAGTANGGOL C. GUNIGUNDO, PCGG Chairman and ORLANDO C. SALVADOR, as Consultant, Technical Working Group of the Presidential Ad Hoc Fact-Finding Committee on Behest Loans, Petitioners, v. HON. ANIANO A. DESIERTO as Ombudsman; JOSE Z. OSIAS; PACIFICO E. MARCOS; EDUARDO V. ROMUALDEZ; FERNANDO C. ORDOVEZA; and JUANITO ORDOVEZA, Members of the Board of Directors of Philippine Seeds, Inc.; CONCERNED MEMBERS OF THE DEVELOPMENT BANK OF THE PHILIPPINES, Respondents.

D E C I S I O N

DAVIDE, JR., C.J.:

The core issue in this special civil action for certiorari is whether public respondent Ombudsman Aniano A. Desierto (hereafter OMBUDSMAN) committed grave abuse of discretion in holding that the offenses with which the other respondents were charged in OMB-0-96-0968 had already prescribed.

This case originated as G.R. No. 129763, the docket number given to the Motion for Extension of Time to File Petition for Review filed by the Presidential Commission on Good Government (PCGG).¹ The motion was granted. However, what was filed was a petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure, with the Presidential Ad Hoc Fact-Finding Committee on Behest Loans (hereafter COMMITTEE) as petitioner. The petition was docketed as G.R. No. 130140. Accordingly, G.R. No. 129763 is now deemed functus officio.

Initially, the Court dismissed the petition in this case on technical grounds. But, upon petitioners motion for reconsideration, the petition was reinstated, and the respondents were required to comment on the petition.

In its Manifestation (In Lieu of Comment),² the Development Bank of the Philippines (DBP) manifested that it would rel[y] on the evaluation and exercise of the discretionary power conferred on Petitioner in the prosecution of the instant petition.

In its Manifestation and Motion³ of 16 February 1998, the Office of the Solicitor General (OSG) informed the Court that it could not represent the OMBUDSMAN for the following reasons: (a) the Solicitor General is the Vice-Chairman of petitioner COMMITTEE; (b) being an agency of the Government, the COMMITTEE is entitled to be represented by the OSG; and (c) the petition was signed by Associate Solicitor Salvador C. Guevarra, who is presently on detail with the PCGG, and by Commissioner Herminio A. Mendoza of the PCGG, which is also a client of the OSG. The Court then required the OMBUDSMAN to file his own comment, which he did on 11 June 1998.⁴cräläwvirtualibräry

Copies of the resolution requiring comment on the petition sent to the other respondents were returned to sender because the said respondents had MOVED. Since the challenged resolution and order of the OMBUDSMAN were issued before said other respondents were even required to submit their counter-affidavits, impleading them in this case is not necessary; hence, this case can be resolved without their inclusion as Respondents.

As culled from the initiatory pleadings and MEMORANDA of the COMMITTEE and the OMBUDSMAN, the undisputed facts are as follows:

On 8 October 1992, President Fidel V. Ramos issued Administrative Order No. 13, creating the Presidential Ad Hoc Fact-Finding Committee on Behest Loans, with the Chairman of the PCGG as Chairman; the Solicitor General as Vice Chairman; and one representative each from the Office of the Executive Secretary, Department of Finance, Department of Justice, Development Bank of the Philippines, Philippine National Bank, Asset Privatization Trust, Government Corporate Counsel, and the Philippine Export and Foreign Loan Guarantee Corporation as members. The Committee was directed to perform the following functions:

1. Inventory all behest loans; identify the lenders and borrowers, including the principal officers and stockholders of the borrowing firms, as well as the persons responsible for granting the loans or who influenced the grant thereof;

2. Identify the borrowers who were granted friendly waivers, as well as the government officials who granted these waivers; determine the validity of these waivers.

3. Determine the courses of action that the government should take to recover those loans, and to recommend appropriate actions to the Office of the President within sixty (60) days from the date hereof.

On 9 November 1992, President Ramos issued Memorandum Order No. 61 directing the COMMITTEE to include in its investigation, inventory, and study all non-performing loans which shall embrace both behest and non-behest loans. It likewise provided for the following criteria which might be utilized as a frame of reference in determining a behest loan, to wit:

a. It is undercollateralized.

b. The borrower corporation is undercapitalized.

c. Direct or indirect endorsement by high government officials like presence of marginal notes.

d. Stockholders, officers or agents of the borrower corporation are identified as cronies.

e. Deviation of use of loan proceeds from the purpose intended.

f. Use of corporate layering.

g. Non-feasibility of the project for which financing is being sought.

h. Extraordinary speed in which the loan release was made.

x x x

Moreover, a behest loan may be distinguished from a non-behest loan in that while both may involve civil liability for non-payment or non-recovery, the former may likewise entail criminal liability.

In its FOURTEENTH (14TH) REPORT ON BEHEST LOANS to President Ramos, dated 15 July 1993,⁵ the COMMITTEE reported that the Philippine Seeds, Inc., (hereafter PSI) of which the respondents in OMB-0-96-0968 were the Directors, was one of the twenty-one corporations which obtained behest loans.

In his instructions handwritten on the cover of the aforementioned Report, President Ramos directed COMMITTEE Chairman Magtanggol C. Gunigundo to, inter alia, proceed with administrative and judicial actions against the twenty-one firms (out of 21) in this batch with positive findings ASAP.⁶cräläwvirtualibräry

On 2 March 1996, the COMMITTEE through Orlando O. Salvador, the PCGG consultant detailed with the COMMITTEE, filed with the OMBUDSMAN a sworn complaint⁷ against the Directors of PSI namely, Jose Z. Osias, Pacifico E. Marcos, Eduardo V. Romualdez, Fernando C. Ordoveza, and Juanito Ordoveza; and the Directors of the Development Bank of the Philippines who approved the loans for violation of paragraphs (e) and (g) of Section 3 of Republic Act No. 3019, as amended, which read:

Sec. 3. Corrupt Practices of Public Officers. - In addition to acts or omissions of public officers already penalized by existing law, the following shall constitute corrupt practices of any public officer and are hereby declared to be unlawful:

. . .

e. Causing any undue injury to any party, including the Government or giving any private party any unwarranted benefit, advantage or preference in the discharge of his official, administrative or judicial functions through manifest partiality, evident bad faith or gross inexcusable negligence. This provision shall apply to officers and employees of offices or government corporations charged with the grant of licenses or permits or other concessions.

. . .

g. Entering, on behalf of the Government, into any contract or transaction manifestly and grossly disadvantageous to the same, whether or not the public officer profited or will profit thereby.

The complaint, later docketed as OMB-0-96-0968, alleged as follows:

4. The evidence submitted to us show that:

a) Philippine Seeds, Inc. (PSI) obtained its initial loan guarantee on April 17, 1969 under B/R 2805 (Annex 1, Evidence 3) with an aggregate amount of $3,452,535. or P13,568,463. (P3.93 to $1) . . . .

Based on the foregoing DBP approved Guarantee Loans, PSI still had a collateral deficiency of P5,444,432, and likewise DBP infused the amount of P3,824,911 as against the corporations paid-up capital of P2,225,000 only.

b) Subsequent loans/guarantees were extended by DBP for the benefit and/or advantage of PSI under the following Board Resolutions:

1) B/R 3353 dated August 13, 1975 (Annex 2, Evidence 4) for the following purposes:

(a) DBP to extend a loan of P215,000 at 12% interest per annum for repairs & rehabilitation of the PSI plant within a period of four (4) months from the full release of the amount.

(b) DBP to extend a short term of P6 million at 12% interest per annum for its working capital.

(c) DBP to assume PSI loans with commercial banks.

(d) DBP to restructure PSI existing obligations if after 6 months of trial period, operations proved profitable and viable.

(e) DDBP to suspend foreclosure for 10 months.

2) B/R 883 series 1978, (Annex 3, Evidence 9) DBP Board approved a P2.9 million loan for the following purposes:

(a) P1.9 million to liquidate PSIs obligation with other creditors.

(b) P1.0 million to finance PSIs special projects.

(c) DBP initiated PSI foreclosures starting March 1975 but it was not implemented by virtue of then President Marcos marginal notes dated April 1975 (Annex 4, Evidence 6) and June 1995 (Annex 5, Evidence 7).

(d) Pacifico Marcos and Eduardo Romualdez, relatives of the late President Marcos, were the principal stockholders and officers of the subject firm.

5. As a private entity, Philippine Seeds, Inc., did not deserve the concessions given it without sufficient collateral for the loan and adequate capital to ensure not only the viability of its operations but its ability to repay all its loans.

In the resolution⁸ dated 14 May 1996 and approved on 9 June 1996, the OMBUDSMAN dismissed the complaint in OMB-0-96-0968 on the ground of prescription. Relying on People v. Dinsay,⁹ a case decided by the Court of Appeals, he ratiocinated that since the questioned transactions were evidenced by public instruments and were thus open for the perusal of the public, the prescriptive period commenced to run from the time of the commission of the crime, not from the discovery thereof. Reckoning the prescriptive period from 1969, 1970, 1975, and 1978, when the disputed transactions were entered into, the OMBUDSMAN ruled that the offenses with which respondents were charged had already prescribed.

Its motion for reconsideration having been denied by the OMBUDSMAN in the Order¹⁰ of 19 May 1997, the COMMITTEE filed this case raising this sole issue:

WHETHER OR NOT THE PUBLIC RESPONDENT OMBUDSMAN GRAVELY ABUSED HIS DISCRETION IN HOLDING THAT THE PRESCRIPTIVE PERIOD IN THIS CASE SHOULD BE COUNTED FROM THE DATE OF THE GRANT OF THE BEHEST LOANS INVOLVED, AND NOT FROM THE DATE OF DISCOVERY OF THE SAME BY THE COMMITTEE.

The COMMITTEE argues that the right of the Republic of the Philippines to recover behest loans as ill-gotten wealth is imprescriptible pursuant to the mandate of Section 15 of Article XI of the Constitution, which provides:

The right of the State to recover properties unlawfully acquired by public officials or employees, from them or from their nominees as transferees, shall not be barred by prescription, laches, or estoppel.

Behest loans are part of the ill-gotten wealth which former President Marcos and his cronies accumulated and which the Government through the PCGG seeks to recover. Besides, even assuming ex gratia that the right to file criminal charges against the respondents is prescriptible, the prescriptive period should be counted from the discovery of the crimes charged, and not from the date of their commission. The ruling in Dinsay is not applicable to the case at bar. First, it is a decision of the Court of Appeals; hence, it does not establish a doctrine and can only have a persuasive value. Second, it involved a prosecution for estafa in that the accused disposed of his property claiming that it was free from any lien or encumbrance despite the fact that a notice of lis pendens was registered with the Registry of Deeds. The sale, cancellation of the accuseds title, and issuance of a new title to the buyer could not have been concealed from the offended parties or their lawyers because these transactions took place when the civil case involving the said property and the offended parties was in progress. Third, Dinsay involved private parties, while the instant case involves the Government and public officers. Fourth, the ruling is not absolute, since no less than this Court in People vs. Monteiro¹¹ said:

[T]he period of prescription for the offense of failure to register with the SSS shall begin from the day of the discovery of the violation if this was not shown at the time of its commission. A contrary view would be dangerous as the successful concealment of an offense during the period fixed for its prescription would be the very means by which the offender may escape punishment. (Emphasis supplied)

Also, in People v. Duque,¹² which involved a prosecution for illegal recruitment under Article 38 of the Labor Code, this Court held:

Even if it be assumed arguendo that ordinary prudence required that a person seeking overseas employment ought to check the authority or status of persons pretending to be authorized or to speak for a recruitment or placement agency, the offended parties failure to do so did not start the running of the prescriptive period. In the nature of things, acts made criminal by special laws are frequently not immoral or obviously criminal in themselves; for this reason, the applicable statute requires that if the violation of the special law is not known at that time, the prescription begins to run only from the discovery thereof, i.e., discovery of the unlawful nature of the constitutive act or acts. (Emphasis supplied)

Finally, the COMMITTEE asserts that even assuming that the discovery rule does not apply, still, because of the principle of equitable tolling, prescription has not yet set in for the offenses with which respondents in OMB-0-96-0960 were charged. This principle is based on the doctrine contra non valentem agere nulla currit praescriptio, i.e., no prescription shall run against a person unable to bring an action. The COMMITTEE was unable to bring the action, for the cause therefor was not known or reasonably known to it owing to the fact that (1) the loans, being behest, were concealed; (2) both parties to the loan transactions were in conspiracy to perpetrate the fraud against the State; and (3) the loans were granted at the time then President Marcos was at the threshold of his authority when no one dared question, much less investigate, any of his orders.

The OMBUDSMAN takes a different view. For one, he asserts that Section 15 of Article XI of the Constitution is not applicable, since what the COMMITTEE seeks in OMB-0-96-0968 is not to recover the unlawfully acquired wealth from the respondents therein but to hold them criminally liable for violation of R.A. No. 3019. The dismissal of the case is not a bar to the institution of forfeiture proceedings against the concerned former government officials and cronies.

For another, the OMBUDSMAN insists that the offenses with which the respondents were charged had already prescribed. As a matter of fact it prescribed in ten years pursuant to the original provision of Section 11 of R.A. No. 3019, which fixed the prescriptive period at ten years. B.P. Blg. 195, which increased the prescriptive period to fifteen years, became effective only on 16 March 1982 and cannot be given retroactive effect; hence, the offenses which might have arisen from the grant of the assailed loans in 1969, 1975 and 1978 prescribed in 1979, 1985 and 1988, respectively.

The OMBUDSMAN points to Section 2 of Act No. 3326, which governs prescription of crimes under special laws and which reads as follows:

Sec. 2. 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 . . .

According to him, the computation of the prescriptive period from the date of discovery would only be resorted to if the commission of the crime be not known at the day of the commission. The phrase if the same be not known does not mean lack of actual knowledge, but that the crime is not reasonably knowable by reason of the nature of the crime or the environmental circumstances thereof. In the case filed by the COMMITTEE, the crimes alleged to have been committed were reasonably knowable because the transactions were never conducted clandestinely ... [but] carried out in the open, leaving a trail of public instruments/documents accessible and susceptible to evaluation. Moreover, as can be drawn from the allegation in the COMMITTEEs complaint that the DBP initiated PSI foreclosures starting March 1975, the corresponding mortgages were executed and registered. Hence, the doctrine laid down in Dinsay is applicable. Likewise, in People v. Sandiganbayan,¹³ this Court ruled that the prescriptive period for the violation of R.A. No. 3019, which was allegedly committed by Paredes by misrepresenting in an application for land patent that the subject land was disposable, started to run from the date of the filing of the application. Yet, in said case the falsity of Paredes representation regarding the disposability of the land was not capable of being drawn from the application alone; nevertheless, this Court was not deterred from holding that prescription started to run from the filing of the application.

Finally, the OMBUDSMAN maintains that any confidential relationship between the former strongman and the respondents DBP officials ceased altogether after the February 1986 EDSA revolution. Even assuming then that the running of the 10-year period of prescription was suspended by reason of the said confidential relationship, the same re-started in February 1986 and went on to lapse in February 1996. However, the complaint of the COMMITTEE in OMB-0-96-0968 was filed only on 2 March 1996.

We agree with the OMBUDSMAN that Section 15 of Article XI of the Constitution applies only to civil actions for recovery of ill-gotten wealth, and not to criminal cases, such as the complaint against the respondents in OMB-0-96-0968. This is clear from the proceedings of the Constitutional Commission of 1986.

What is now Section 15 of Article XI of the Constitution was originally Section 13 of the proposed Article on Accountability of Public Officers in Committee Report No. 17 submitted to the Constitutional Commission by its Committee on Accountability of Public Officers,¹⁴ viz:

The right of the State to recover properties unlawfully acquired by public officials or employees shall not be barred by prescription.

At the plenary session, Commissioner Hilario G. Davide, Jr., succeeded in having that Section amended. Thus:

MR. DAVIDE. Madam President.

MR. DAVIDE. Would the proponent accept some amendments?

MR MAAMBONG. Gladly.

MR. DAVIDE. The amendment of Section 13 will consist of the following: On line 25, after the word employees, add the following: OR THEIR CO-PRINCIPALS, ACCOMPLICES OR ACCESSORIES OR TO PROSECUTE OFFENSES IN CONNECTION THEREWITH; then on line 25, after the word prescription, add a comma (,) and the words LACHES OR ESTOPPEL. So the entire Section 13 will read as follows: The right of the State to recover properties unlawfully acquired by public officials or employees OR THEIR CO-PRINCIPALS, ACCOMPLICES OR ACCESSORIES OR TO PROSECUTE OFFENSES IN CONNECTION THEREWITH shall not be barred by prescription, LACHES OR ESTOPPEL.

. . .

MR. DAVIDE. I would like to insist on my proposal for the plain and simple reason that the republic act on forfeiture of ill-gotten wealth would cover only the civil aspect. As a matter of fact, any prosecution for the criminal aspect of that will have to be taken under the Anti-Graft and Corrupt Practices Act. That is why it is necessary to include here, specifically, the criminal action and the imprescriptibility of the criminal action. Besides, what is stated in the law on ill-gotten wealth and recovery thereof would refer to prescription or statute of limitations. We know for a fact that there are two other concepts in Civil Law. We have laches and estoppel. Laches, for instance, is a concept entirely different from prescription. While an action may not prescribe, it may be barred by laches and while an action may not prescribe or may not be barred by laches, it may also be a limitation because of estoppel. So, if we really want to strengthen this particular concept, we should be very specific in having it related to both criminal and civil actions. In addition to prescription, we should also include laches and estoppel.

. . .

THE PRESIDENT. Is it accepted by the Committee?

MR. NOLLEDO. After consultations, the Committee is happy to announce that we are accepting the amendment.

MR. DAVIDE. Thank you, Madam President; I also thank the members of the Committee.

THE PRESIDENT. Is there any objection? (Silence) The Chair hears none; the amendment is approved.¹⁵ (Emphasis supplied).

As shown, the amendment made the provision applicable as well to criminal actions arising from, relating or incident to, or involving ill-gotten wealth.

However, on motion for reconsideration by Commissioner Christian Monsod, who explained that the intention of the Committee was to limit the proposed Section 13 to civil actions, and without objection on the part of Commissioner Davide, the motion for reconsideration was granted. As a consequence, the amendment of Commissioner Davide regarding the applicability of the Section to criminal actions was deleted. After further proceedings the Section was further amended by the insertion of the phrase from them or from their transferees. Thus:

MR. BENGZON. There is just one loose thread hanging in the Article on Accountability of Public Officers and I would like to get this out of the way. May I suggest that Commissioner Monsod be recognized.

THE PRESIDING OFFICER. (Mr. de los Reyes). Commissioner Monsod is recognized.

MR. MONSOD. We circulated to the Commissioners a memorandum that was unanimously endorsed by the members of the committee, except for one member who [was] absent. In this memorandum, we suggested the deletion of a phrase which we consider redundant in the context of the intent of the committee. We wanted to ask the body for any comment it may have on it because we feel we do not need to reopen the article if the body agrees with us that it is not a substantial change, but a change to reflect the intention of the body and the committee on this matter.

THE PRESIDING OFFICER (Mr. de los Reyes). On what article is that, Commissioner Monsod?

MR. MONSOD. It is on the Article on Accountability of Public Officers which was circulated a couple of days ago.

On Section 13, lines 7 and 8, we propose to delete the phrase or to prosecute offenses in connection therewith. The committee considers this phrase redundant with its intent on the recovery of property illegally acquired. The action contemplated by the committee is a civil action. However, since jurisprudence considers such action for recovery as partaking of a criminal action, we believe that it is not necessary to mention or to prosecute offenses in connection therewith. Hence, we ask the body if there is any objection to delete that phrase.

THE PRESIDING OFFICER (Mr. de los Reyes). Commissioner Monsod, what is the phrase sought to be deleted?

MR. MONSOD. The phrase or to prosecute offenses in connection therewith.

. . .

MR. MONSOD. May we ask Commissioner Davide, the proponent of some of these amendments, on this article?

THE PRESIDING OFFICER (Mr. de los Reyes) Commissioner Davide is recognized.

MR. DAVIDE. Thank you, Mr. Presiding Officer.

After deeper reflection on the consequences of the amendments which I introduced and which are now sought to be deleted, and taking into account the massive consensus of opinions on the part of the committee which is now seeking for its reconsideration, I would have no objection to it. However, there is a point to be taken up and I understand that Commissioner Regalado has also a point to take up on this.

THE PRESIDING OFFICER (Mr. de los Reyes). Commissioner Regalado is recognized.

MR. REGALADO. Thank you, Mr. Presiding Officer.

I move for the deletion of the phrase co-principals, accomplices or accessories, because what is contemplated in that amendment is a civil action. The phrase co-principals, accomplices and accessories is proper only in a criminal action. So, I have asked the committee to delete those words.

THE PRESIDING OFFICER (Mr. de los Reyes). So, how will the section now read?

MR. MONSOD. The section as amended by deletion will now read: Sec. 13. The right of the State to recover properties unlawfully acquired by public officials or employees shall not be barred by prescription, laches or estoppel.

THE PRESIDING OFFICER (Mr. de los Reyes). So for the information of the Members of the Commission, what phrases are deleted?

MR. MONSOD. The phrases that are deleted are as follows: or to prosecute offenses in connection therewith and or their co-principals, accomplices or accessories.

THE PRESIDING OFFICER (Mr. de los Reyes). So, in effect, the Commissioner is asking for a reconsideration.

MR. MONSOD. It has been suggested that that would be appropriate in order to make sure that this is properly regularized.

RECONSIDERATION OF APPROVAL

OF PROPOSED RESOLUTION NO. 456

(Article on the Accountability of Public Officers)

THE PRESIDING OFFICER (Mr. de los Reyes). As many as are in favor of reconsidering Section 13, please raise their hand. (Several Members raised their hand.)

As many as are against, please raise their hand. (No Member raised his hand).

The results show 27 votes in favor and 1 against; the reconsideration is approved.¹⁶

Commissioner Monsod is again recognized.

MR MONSOD. I propose that we delete the phrases: or their co-principals, accomplices or accessories and or to prosecute offenses in connection therewith. So, the entire article will now read: The right of the State to recover properties unlawfully acquired by public officials or employees shall not be barred by prescription, laches or estoppel.

. . .

THE PRESIDING OFFICER (Mr. de los Reyes). Is there any objection to the amendment of Commissioner Monsod?

Commissioner Azcuna is recognized.

MR AZCUNA. Mr. Presiding Officer, the phrase co-principals, accomplices and accessories refers to criminal cases. So I propose to insert the phrase OR THEIR TRANSFEREES IN BAD FAITH in order to be able to recover these properties even from transferees of the public officers if they are done in bad faith. Hence, the amended section will read: The right of the State to recover properties unlawfully acquired by public officials or employees OR THEIR TRANSFEREES IN BAD FAITH.

THE PRESIDING OFFICER (Mr. de los Reyes). What does Commissioner Monsod say?

MR. MONSOD. We have no objection to that, but I understand there is a comment on this matter.

. . .

THE PRESIDING OFFICER (Mr. de los Reyes). Commissioner Monsod is recognized.

MR MONSOD. In order to clarify the intent of the amendment, we suggest that the amendment be stated this way: FROM THEM OR FROM THEIR TRANSFEREES. So, the entire section will read: The right of the State to recover properties unlawfully acquired by public officials or employees FROM THEM OR FROM THEIR TRANSFEREES shall not be barred by prescription, laches or estoppel.

THE PRESIDING OFFICER (Mr. de los Reyes). Commissioner Azcuna is recognized.

MR AZCUNA. I accept the amendment.

THE PRESIDING OFFICER (Mr. de los Reyes). Commissioner Maambong is recognized.

MR. MAAMBONG. Mr. Presiding Officer, I recall I presented an amendment precisely on this provision. I gave way to Commissioner Davide at that time because the imprescriptibility provision was supposed to cover both criminal and civil actions. I just want to clarify this from Commissioner Monsod or from Commissioner Davide if in the present formulation, what is covered is only imprescriptibility of civil action and not of criminal action. Commissioner Davide can probably answer that.

MR. MONSOD. Mr. Presiding Officer.

THE PRESIDING OFFICER (Mr. de los Reyes). Commissioner Monsod is recognized.

MR. MONSOD. Yes, it is just the imprescriptibility of the civil action.

MR. MAAMBONG. If only civil action, it does not cover imprescriptibility of criminal action.

MR. MONSOD. Yes, that is right.

MR. MAAMBONG. Thank you.

THE PRESIDING OFFICER (Mr. de los Reyes). Is the Commission now prepared to vote on the issue?

MR. RAMA. Yes.

THE PRESIDING OFFICER (Mr. de los Reyes). Is there any objection to the amendment of Commissioner Monsod? (Silence) The Chair hears none; the amendment is approved.¹⁷ (Emphasis supplied).

Then, on motion of the Committee on Style, the Section 13 which became Section 15, was approved; thus:

MR. RODRIGO. In Section 15, we inserted: FROM THEM OR FROM THEIR NOMINEES OR TRANSFEREES and we deleted co-principals, accomplices or accessories or to prosecute offenses in connection therewith. So, Section 15 reads: The right of the State to recover properties unlawfully acquired by public officials or employees, FROM THEM OR FROM THEIR NOMINEES OR TRANSFEREES shall not be barred by prescription, laches, or estoppel.

I move for its approval.

THE PRESIDING OFFICER (Mr. Jamir). Is there any objection? (Silence). The Chair hears none; the amendment is approved.¹⁸

The upshot of the foregoing discussion is that the prosecution of offenses arising from, relating or incident to, or involving ill-gotten wealth contemplated in Section 15, Article XI of the Constitution may be barred by prescription.

Since the law alleged to have been violated, i.e., paragraphs (e) and (g) of Section 3, R.A. No. 3019, as amended, is a special law, the applicable rule in the computation of the prescriptive period is Section 2 of Act No. 3326,¹⁹ as amended, which provides:

Sec. 2. 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 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 double jeopardy.

This simply means that if the commission of the crime is known, the prescriptive period shall commence to run on the day it was committed.

In the present case, it was well-nigh impossible for the State, the aggrieved party, to have known the violations of R.A. No. 3019 at the time the questioned transactions were made because, as alleged, the public officials concerned connived or conspired with the beneficiaries of the loans. Thus, we agree with the COMMITTEE that the prescriptive period for the offenses with which the respondents in OMB-0-96-0968 were charged should be computed from the discovery of the commission thereof and not from the day of such commission.

The assertion by the OMBUDSMAN that the phrase if the same be not known in Section 2 of Act No. 3326 does not mean lack of knowledge but that the crime is not reasonably knowable is unacceptable, as it provides an interpretation that defeats or negates the intent of the law, which is written in a clear and unambiguous language and thus provides no room for interpretation but only application.

The OMBUDSMANs reliance on Dinsay is misplaced. The estafa committed by the accused was known to the offended party from the very start; hence, it could even be said that the commission and the discovery of the offense were simultaneous.²⁰ Neither is People v. Sandiganbayan²¹ of any help to OMBUDSMAN. We ruled therein that the prescriptive period commenced to run from the filing of the application for the following reasons:

The theory of the prosecution that the prescriptive period should not commence upon the filing of Paredes application because no one could have known about it except Paredes and Lands Inspector Luison, is not correct for, as the Sandiganbayan pointedly observed: it is not only the Lands Inspector who passes upon the disposability of public land x x x other public officials pass upon the application for a free patent including the location of the land and, therefore, the disposable character thereof (p. 30, Rollo). Indeed, practically all the department personnel, who had a hand in processing and approving the application, namely: (1) the lands inspector who inspected the land to ascertain its location and occupancy; (2) the surveyor who prepared its technical description; (3) the regional director who assessed the application and determined the land classification; (4) the Director of Lands who prepared the free patent; and (5) the Department Secretary who signed it, could... have helped discovering that the subject of the application was non disposable public agricultural land.

There was no showing that Paredes had connived with all the department personnel, who had a hand in processing and approving the application of Paredes. Consequently, such personnel could have easily discovered the falsity in Paredes claim and denounced it. It would have been entirely different if the public officials concerned conspired with him, in which case, they would have hidden the misdeed to escape culpability.

People v. Duque²² is more in point, and what was stated there stands reiteration: In the nature of things, acts made criminal by special laws are frequently not immoral or obviously criminal in themselves; for this reason, the applicable statute requires that if the violation of the special law is not known at the time, the prescription begins to run only from the discovery thereof, i.e., discovery of the unlawful nature of the constitutive act or acts.

In the case at bar the OMBUDSMAN forthwith dismissed the complaint in Case No. OMB-0-96-0968 without even requiring the respondents to submit their counter-affidavits and solely on the basis of the dates the alleged behest loans were granted, or the dates of the commission of the alleged offense was committed.

Since the computation of the prescriptive period for the filing of the criminal action should commence from the discovery of the offense, the OMBUDSMAN clearly acted with grave abuse of discretion in dismissing outright Case No. OMB-0-96-0968. It should have first received the evidence from the complainant and the respondents to resolve the case on its merits and on the issue of the date of discovery of the offense.

IN LIGHT OF ALL THE FOREGOING, judgment is hereby rendered GRANTING the petition, and SETTING ASIDE the resolution of 14 May 1996 and the Order of 19 May 1997 of the public respondent OMBUDSMAN in Case No. OMB-0-96-0968.

The OMBUDSMAN is hereby directed to proceed with the preliminary investigation of the case OMB-0-96-0968 taking into account the foregoing disquisitions.

No pronouncement as to costs.

SO ORDERED.

Mendoza, Panganiban, Quisumbing, Purisima, Buena, Gonzaga-Reyes, and De Leon, Jr., JJ., concur.

Melo, J., see concurring and dissenting opinion.

Puno, J., see concurring and dissenting opinion.

Vitug, J., see concurring opinion.

Bellosillo, J., joins J. Melo in his concurring and dissenting opinion.

Kapunan, Pardo, and Ynares-Santiago, JJ., joins J. Puno in his concurring and dissenting opinion.

Endnotes:

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¹ Rollo, G.R. No. 129763, 2-3.

² Rollo, G.R. No. 130140, 170-171. Henceforth, references to rollo shall mean the rollo in this case.

³ Id., 186-188.

⁴ Rollo, 203-214.

⁵ Annex F of Petition: Rollo, 40, et seq.

⁶ Id., 40.

⁷ Annex G of Petition; Rollo, 78-81.

⁸ Annex C of Petition; Rollo, 55-58. This was signed by Atty. Roline M. Ginez-Jabalde, Graft Investigation Officer II; recommended for approval by Angel C. Mayoralgo, Jr., Director of the Evaluation and Preliminary Investigation Bureau; and reviewed by Nicanor J. Cruz, Jr., Asst. Ombudsman, PACPO, OIC, EIO.

⁹ C.A., 40 O.G., 12th Supp., 50

¹⁰ Annex A of Petition; Rollo, 24-26.

¹¹ 192 SCRA 548 [1990].

¹² 212 SCRA 607 [1992].

¹³ 211 SCRA 243 [1992].

¹⁴ 2 Record of the Constitutional Commission, 263-264.

¹⁵ 2 Record of the Constitutional Commission, 346-348.

¹⁶ 4 Record of the Constitutional Commission, 40-41.

¹⁷ 4 Record of the Constitutional Commission, 41-44.

¹⁸ 5 Record of the Constitutional Commission, 801-802.

¹⁹ Entitled An Act to Establish Periods of Prescription for Violations Penalized by Special Acts and Municipal Ordinances to Provide When Prescription Shall Begin to Run.

²⁰ People v. Monteiro, supra note 11, at 553.

²¹ Supra note 13, at 246-247.

²² Supra note 12, at 613-614.