Friday, November 22, 2019

How to apply the Arias doctrine?

SECOND DIVISION
G.R. No. 184766
August 15, 2018

JOSIE CASTILLO-CO, PETITIONER, V. HONORABLE SANDIGANBAYAN (SECOND DIVISION), AND PEOPLE OF THE PHILIPPINES, RESPONDENTS.

D E C I S I O N

A. REYES, JR., J.:



When a local legislative board gives the local chief executive authority to perform a certain act or enter into a specific transaction, the latter ought to strictly abide by the express terms of such authority. Any deviation therefrom, to the detriment of the local government unit, constitutes an offense punishable under the Anti-Graft and Corrupt Practices Act, for which the chief executive must be held accountable.

Before this Court is a Petition for Review on Certiorari[1] under Rule 45 of the Rules of Court seeking to nullify (1) the Decision[2] dated April 28, 2008 of the Sandiganbayan, which found the petitioner, Josie Castillo-Co (Gov. Co), Governor of the Province of Quirino, guilty of violating Section 3(g) of Republic Act (R.A.) No. 3019, and (2) the subsequent Resolution[3] dated September 24, 2008 denying her Urgent Motion for Reconsideration and Supplemental Motion for Reconsideration.

The Factual Antecedents

On June 27, 1997, Junie E. Cua, (Rep. Cua) Representative of the Province of Quirino and the Chairman of the Committee on Good Government of the House of Representatives, filed a letter-complaint before the Office of the Ombudsman against the petitioner, Gov. Co, and the Provincial Engineer of the Province of Quirino, Virgilio Ringor (Engr. Ringor), for violations of Section 3(e) and (g) of the Anti-Graft and Corrupt Practices Acts, Frauds Against the Public Treasury, and Malversation of Public Funds.[4]

In the letter-complaint, Rep. Cua alleged that irregularities attended the purchase of heavy equipment by the Provincial Government of Quirino from Nakajima Trading Co., Ltd. (Nakajima Trading).[5]

According to Rep. Cua, prior to contracting with Nakajima Trading and in order to fund the purchase, Gov. Co entered into a loan agreement with the Philippine National Bank (PNB) by virtue of a resolution of the Sangguniang Panlalawigan of Quirino. The resolution authorized Gov. Co to obtain a loan to fund the purchase of brand new heavy equipment.[6]

However, on January 11, 1996, Gov. Co entered into an agreement to purchase reconditioned heavy equipment instead, with the Province of Quirino as the buyer and Nakajima Trading as the seller.[7]

The letter-complaint also alleged that Gov. Co agreed to advance 40% of the total purchase price before the delivery of the machinery would be effected, in violation of the prohibition on advance payments found in Section 338 of the Local Government Code of 1991.[8]

Rep. Cua additionally averred that the equipment purchased by the Province of Quirino was overpriced. To substantiate this allegation, he presented quotations comparing the prices of the equipment furnished by Nakajima Trading and similar or equivalent models of the same machines from local suppliers.[9]

Lastly, Rep. Cua alleged that despite full payment of the purchase price, the Province of Quirino did not receive everything owing it under the agreement with Nakajima Trading.[10] According to Rep. Cua, Nakajima Trading failed to ship an Ingersol-Rand SP 100 Vibratory Road Roller and a set of tools and spare parts within the stipulated 90-day delivery period.[11] While the amount pertaining to the equipment was subsequently returned, Rep. Cua averred that Nakajima Trading did not refund the amount of interest pertaining to the refunded amount, to the prejudice of the province.[12]

Meanwhile, Engr. Ringor was charged with conspiring with Gov. Co.[13] In his counter-affidavit, however, he interposed the defense that he merely recommended the purchase of reconditioned heavy equipment in place of brand new heavy equipment due to insufficiency of funds.[14]

After the letter-complaint was filed, the case was assigned to Graft Investigation Officer Germain G. Lim of the Office of the Ombudsman who, later on, recommended the prosecution of Gov. Co[15] and the dismissal of the case against Engr. Ringor.[16] These recommendations were contained in the Ombudsman Resolution[17] dated September 1, 1998.

On September 2, 1998, an Information[18] was filed before the Sandiganbayan against Gov. Co for violation of Section 3(g) of R.A. No. 3019, the accusatory portion of which reads:

That on or about 11 January 1996, or sometime prior or subsequent thereto, in the City of Manila, Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, a public officer, then being the Governor of the Province of Quirino, committing the penal offense herein charged while in the performance of, in relation to, and taking advantage of her official position and functions as such did then and there willfully, unlawfully and criminally enter, on behalf of the Province of Quirino and the government as the buyer, into the Agreement dated 11 January 1996 with Nakajima Trading Co., Ltd. as the seller, for the purchase by the aforesaid buyer from the seller of overpriced reconditioned heavy equipment, spare parts, and tools, specified as follows:

1. One (1) unit Bulldozer CAT D6H Series II or equivalent;
2. One (1) unit Motor Grader Mitsubishi LG2H Blade 3.7M or equivalent;
3. One (1) unit Wheel Loader 3.5M3 Class CAT 936/Komatsu wa450 or equivalent;
4. One (1) unit Vibratory Road Roller Ingersol-Rand SP 100 or equivalent;
5. One (1) unit Backhoe Mitsubishi with 128 Flywheel HP Diesel Engine, track link type or equivalent;
6. Five (5) units LHD Dump Truck Isuzu CXZ 19/21 or equivalent;
7. One (1) lot Spare Parts for 2 yrs. fast moving;
8. One (1) unit Isuzu Water Tank Lorry w/ Sprinkle 10KL Cap w/ 6HEI Diesel Engine or equivalent;
9. One (1) Set Low Bed Trailer 40 tons, 10 Wheeler Tractor Head Isuzu EXZ 19/21 double diff.;
10. One (1) unit Toyota Hi-Lux, 4WD Double Cab 2.8 Diesel, FLD, Complete w/ Accessories; and
11. One (1) lot Tools.[19]

at a total contract price of Y160,425,000.00, Japanese currency, which contract is manifestly and grossly disadvantageous to the Province of Quirino and the government, as the same provides for the unlawful advance payment by the buyer to the seller of forty percent (40%) of the said contract price, in violation of Section 338 of the Local Government Code, and for the purchase by the buyer from the seller of reconditioned heavy equipments (sic) instead of brand new ones as expressly mandated by the Resolution No. 120 dated 20 October 1995 passed by the Province of Quirino, to the damage and prejudice of the Sangguniang Panlalawigan of the Province of Quirino and the government.

CONTRARY TO LAW.

Ruling of the Sandiganbayan

In the April 28, 2008 Decision, which is now before this Court for review, the Sandiganbayan found Gov. Co guilty of entering into a transaction grossly and manifestly disadvantageous to the government, in violation of Section 3(g) of R.A. No. 3019. The dispositive portion thereof reads:

Accordingly, We find the Accused, Josie Castillo-Co, GUILTY of violating Sec. 3(g) of R.A 3019 and sentence her to an Indeterminate Penalty of imprisonment of Six Years and One Month as minimum to Nine Months as maximum with perpetual disqualification from public office. By way of civil liability, Accused Josie Castillo-Co is ordered to indemnify the Provincial Government of Quirino, the sum of P330,490.78 representing the interest paid to PNB by the Provincial Government on the 40% advance payment to Nakajima Trading.

SO ORDERED.[20]

The anti-graft court ruled that Gov. Co had entered into an agreement to purchase reconditioned heavy equipment when the authority given to her by the Sangguniang Panlalawigan of Quirino was for the purpose of obtaining a loan to fund the purchase of brand new equipment.[21] It held that she was not able to show that the Sangguniang Panlalawigan had ratified the purchase of reconditioned equipment, thus causing gross and manifest disadvantage to the province.[22]

In addition, the Sandiganbayan found that not only was an advance payment of 40% of the purchase price was effected in violation of Section 338 of the Local Government Code, but also that the remaining 60% was paid before complete delivery of all the subject equipment. The evidence of the prosecution showed that Nakajima Trading failed to deliver the vibratory road roller, tools, and spare parts within the 90-day delivery period stated in the agreement. To the Sandiganbayan, this too constituted gross disadvantage.[23]

Finally, the Sandiganbayan held that, while Nakajima Trading refunded the amount representing the value of the undelivered equipment, the Province of Quirino still suffered losses by reason of the interest it owed the PNB under the loan agreement because the amount returned by the Japanese company did not include the amount representing interest due. The Sandiganbayan also said, however, that the prosecution was unable to prove the exact amount of interest paid to the PNB.[24]

Gov. Co filed her Urgent Motion for Reconsideration on May 8, 2008 and Supplemental Motion for Reconsideration on May 14, 2008. The Sandiganbayan, however, denied both in its Resolution dated September 24, 2008.[25]

Hence, the instant petition.

The Issue

In her petition asking for the reversal of the Sandiganbayan's decision, Gov. Co raises issues that may be synthesized as:

WHETHER OR NOT THE SANDIGANBAYAN COMMITTED A REVERSIBLE ERROR IN RULING THAT GOVERNOR CO ENTERED INTO A TRANSACTION GROSSLY AND MANIFESTLY DISADVANTAGEOUS TO THE PROVINCIAL GOVERNMENT OF QUIRINO[26]

The Court's Ruling

The petition is devoid of merit. The Sandiganbayan's decision, convicting Gov. Co of violating Section 3(g) of R.A. No. 3019 and sentencing her accordingly, must be affirmed.

R.A. No. 3019 was enacted to repress certain acts of public officers and private persons alike that constitute graft or corrupt practices or may lead thereto.[27]

Particularly, Section 3(g) of R.A. No. 3019, under which Governor Co was charged and found guilty, relevantly provides:

Section. 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:

x x x x

(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.

In Henry T. Go vs. Sandiganbayan,[28] the elements of the offense defined in Section 3(g) of R.A. No. 3019 were enumerated, to wit:

(1) that the accused is a public officer;

(2) that he or she entered into a contract or transaction on behalf of the government; and

(3) that such contract or transaction is grossly and manifestly disadvantageous to the government.[29]

There is no debate as to the existence of the first two elements. That the petitioner is a public officer is settled. At the time of the commission of the act complained of, she was the Governor of Quirino Province.[30] There is also no disputing that the Agreement with Nakajima Trading was a contract or transaction that Gov. Co entered into on behalf of the Provincial Government of Quirino.[31] There is thus no doubt that the first two elements are present in the case at bar.

Gov. Co now contends that the third element cannot exist because, assuming that the province suffered disadvantage, the same was not gross and manifest.

This assertion, however, has no merit.

Section 3(g) of R.A. No. 3019 is intended to be flexible in order to give judges some latitude in determining whether the disadvantage to the government, occasioned by the act of a public officer in entering into a particular contract is, indeed, gross and manifest.[32] Otherwise stated, there is no hard and fast rule against which the disadvantageous acts complained of should be calibrated. The determination of whether the disadvantage caused was gross and manifest, as contemplated by Section 3(g), should be done on a case-to-case basis.

"Gross" connotes something "glaring, reprehensible, flagrant, or shocking.[33]" On the other hand, "manifest" is defined as "evident to the senses, open, obvious, notorious, and unmistakable.[34]"

In this case, the Sandiganbayan finds, and that Court agrees, that the following acts caused gross and manifest disadvantage to the Province of Quirino:

First, entering into an agreement to purchase reconditioned heavy equipment, contrary to the terms of Sangguniang Panlalawigan Resolution No. 120, which authorized Gov. Co to purchase only brand new heavy equipment;

Second, advancing forty (40%) percent of the total contract price to Nakajima Trading, in violation of Section 338 of the Local Government Code, which explicitly prohibits advance payments; and

Third, paying the balance, or sixty (60%) percent of the total contract price, despite non-compliance by Nakajima Trading with a provision in the agreement, which provided that delivery had to be effected within ninety (90) days from payment.

Anent the first act, it was settled at the trial that on December 23, 1995, when the loan agreement with the PNB was entered into, and on January 11, 1996, when the sale with Nakajima Trading was contracted, Gov. Co possessed authority to purchase brand new equipment on behalf of the Province of Quirino. The local government unit granted her such authority through two resolutions enacted by its provincial legislative council or Sangguniang Pan1alawigan. These resolutions were presented into evidence by the prosecution to prove Gov. Co's want of authority to purchase reconditioned equipment.

The first resolution was Sangguniang Panlalawigan Resolution No. 120 dated October 20, 1995, which expressly authorized Gov. Co to negotiate with and obtain a loan from the PNB to fund the purchase of brand new machinery. The province manifested its intent to purchase heavy equipment through this resolution, which, in no uncertain terms, provided that such equipment had to be brand new, to wit:

RESOLUTION AUTHORIZING THE PROVINCIAL GOVERNOR TO REPRESENT THE PROVINCIAL GOVERNMENT OF QUIRINO TO NEGOTIATE AND ENTER INTO A CONTRACT TO OBTAIN A LOAN FROM THE PHILIPPINE NATIONAL BANK IN THE AMOUNT OF FORTY THREE (sic) MILLION FIVE HUNDRED THOUSAND PESOS (P43,500,000.00) FOR THE PURPOSE OF PURCHASING BRAND NEW HEAVY EQUIPMENT AND TO SIGN THE LOAN AGREEMENT, THE PROMISSORY NOTES, AND OTHER DOCUMENTS CONTEMPLATED THEREBY.[35] (Emphasis and underscoring supplied)

Moreover, the Sandiganbayan found that on December 23, 1995, the PNB granted the loan to the province on the basis of the aforementioned resolution.[36]

The record also shows that subsequent resolutions of the Sangguniang Panlalawigan confirmed that the province indeed planned to purchase brand new, and not reconditioned, heavy equipment. The second resolution presented by the prosecution was Sangguniang Panlalawigan Resolution No. 06-A dated January 12, 1996. This resolution, which was enacted a day after the perfection of the agreement with Nakajima Trading, was likewise an unequivocal grant of authority to purchase brand new heavy equipment. In fact, the dispositive portion of Resolution No. 06-A reads:

RESOLVED, AS IT IS HEREBY RESOLVED x x x for the purpose of purchasing brand new [h]eavy [e]quipment x x x[37] (Emphasis and underscoring supplied)

The foregoing clearly shows that the Provincial Government of Quirino intended to acquire only brand new heavy equipment. Resolution No. 120 pre-dated the loan agreement and Resolution No. 06-A was enacted a day after the sale was perfected. Thus, during the periods prior and subsequent to both the loan and the sale, the Province of Quirino made manifest its intent to obtain brand new machinery.

This, however, failed to materialize.

Verily, Gov. Co never denied that she caused the purchase of reconditioned heavy equipment in contravention of the terms of the aforementioned resolutions, which expressly mentioned that the subject equipment had to be brand new. She postulated, however, that she did so only because Engr. Ringor, after informing her of the insufficiency of the loaned funds, recommended that the province procure reconditioned machinery instead. Therefore, the initial questions posed to the Court were:

Was gross and manifest disadvantage caused to the Province of Quirino when Governor Co purchased reconditioned heavy equipment, contrary to Resolution No. 120 and Resolution No. 06-A?[38]

If in the affirmative, did Provincial Engineer Ringor's recommendation justify her deviation from the terms of the aforementioned resolutions?[39]

On the first question, the Court rules in the affirmative; on the second, in the negative.

A resolution is a declaration of the will of a municipal corporation or local government unit on a given matter.[40] In the case at bar, the inclination of the Province of Quirino, as shown by Resolution No. 120 and Resolution No. 06-A, was evidently to procure brand new heavy machinery. To its prejudice, however, Gov. Co caused the expenditure of public funds allotted for that purpose on reconditioned equipment instead. Worse, she did so knowingly. When she entered into the loan with the PNB and the sale with Nakajima Trading, she was well aware of the existence and tenor of Resolution No. 120. She likewise knew, prior to the sale, that the subject equipment was merely reconditioned and not brand new as required by the Sangguniang Panlalawigan. Nonetheless, to the detriment of the province, she pushed through with the transaction. To the Court, this act clearly caused gross and manifest disadvantage to the government.

The record shows that even prior to the date of the loan, the Office of the Provincial Engineer had already informed Gov. Co that the province could not afford brand new equipment. In a letter[41] dated October 31, 1995, Engr. Ringor recommended that the province purchase reconditioned machinery due to insufficiency of funds, to wit:

As per quotation received by the Province from KITA SANGYO Ltd. of 1-7 Masago 4-Chome, Mihama-Ku, Chiba City, Chiba-ken, Japan, copy attached, for the supply of brand new heavy construction equipment x x x amounting to a total cost of JPY 283,155,000 and equivalent to more less P65.0 M. It is informed that the Province may not be able to purchase the 13 units of equipment and spare parts and tools.

In this connection and in order that the proposed loan of the province amounting to more or less P43.0 M would be sufficient, it is recommended that the Province will purchase Japan reconditioned equipment which would still be of good quality.

Very truly yours,

VIRGILIO A. RINGOR
Provincial Engineer[42]

Given the foregoing recommendation of Engr. Ringor, Gov. Co was duty-bound to inform the Sangguniang Panlalawigan that the funds allotted by the province were insufficient for brand new heavy equipment. She was likewise obliged to defer contracting with Nakajima Trading until the province had given her the appropriate authority to purchase reconditioned equipment. However, in defiance of the unequivocal will of the province, she proceeded with the sale.

In her defense, Gov. Co turned to Engr. Ringor's recommendation. Gov. Co posited that she bought reconditioned equipment because the provincial engineer raised the insufficiency of the stun loaned from the PNB and recommended that the province acquire reconditioned machinery. Invoking Arias vs. Sandiganbayan,[43] she argued that her reliance on his statement should serve as a basis for exoneration. She stated that when the allegedly disadvantageous agreement reached her, the same was already prepared and that it was prepared at the Office of the Provincial Engineer. She thus maintained that she should not be faulted for her good faith reliance on Engr. Ringor's recommendation.

Her argument is bereft of merit.

Under the Arias doctrine, all heads of offices have to rely to a reasonable extent on their subordinates and on the good faith of those who prepare bids, purchase supplies, or enter into negotiations.[44]

However, in Rivera vs. People,[45] the Court held:

To clarify, the Arias doctrine is not an absolute rule. It is not a magic cloak that can be used as a cover by a public officer to conceal himself in the shadows of his subordinates and necessarily escape liability. Thus, this ruling cannot be applied to exculpate the petitioners in view of the peculiar circumstances in this case which should have prompted them, as heads of offices, to exercise a higher degree of circumspection and, necessarily, go beyond what their subordinates had prepared.[46] (Emphasis and underscoring supplied)

In this case, the Court finds that Resolution No. 120 should have prompted Gov. Co to be more circumspect in transacting with Nakajima Trading. To reiterate, the resolution clearly directed her to procure brand new heavy equipment. Notwithstanding the tenor of the resolution, however, she contracted with Nakajima Trading for reconditioned equipment and effected the consequent expenditure of public funds thereon. All this, to the prejudice of the Province of Quirino.

Gov. Co cannot now plead her innocence by simply shifting the blame to Engr. Ringor.[47] Knowing that the resolution explicitly granted her authority to purchase brand new equipment, she should have dealt with Nakajima Trading more prudently. Between the Sangguniang Panlalawigan, which authorized her to purchase brand new equipment, on one hand and the Office of the Provincial Engineer, which recommended reconditioned equipment due to insufficiency of funds, on the other, she owed obedience to the former, the same being the legislative branch of the local government unit of which she was the chief executive.

In another attempt to escape liability, Gov. Co introduced into evidence Sangguniang Panlalawigan Resolution No. 205, which, according to her, ratified the contract with Nakajima Trading and showed that the Sangguniang Panlalawigan approved the change from brand new to reconditioned machinery.[48]

Nevertheless, the Sandiganbayan found that Resolution No. 205 was not a ratification of the sale by the Sangguniang Panlalawigan. According to the anti-graft court, the said resolution merely re-appropriated the unutilized portion of the loan proceeds for payment of loan amortizations, insurance and registration fees of the acquired equipment, and personnel services benefits for casual employees of the province. Nowhere in the resolution did it appear that the loan was for the purchase of reconditioned equipment.[49]

To encapsulate, by purchasing reconditioned instead of brand new heavy equipment in contravention of the terms of her authority, Gov. Co entered into a contract grossly and manifestly disadvantageous to the Province of Quirino. Such disadvantage was brought about because the province had set aside public funds for brand new heavy machinery only to receive used albeit reconditioned equipment. Now, she cannot lay the blame on Engr. Ringor by arguing that her actions were precipitated by his recommendation. The evidence distinctly revealed that Gov. Co was well aware of the terms of her authority and of the fact that Nakajima Trading was offering only reconditioned equipment.[50] Nevertheless, she pushed through with the transaction to the prejudice of the province. For this, she must be held accountable.

Thus, on this ground alone, Gov. Co's petition must fail.

Anent the second act, the evidence of the prosecution showed that the telegraphic transfer of 40% of the total contract price was effected on January 24, 1996, while the heavy equipment was initially delivered on April 10, 1996. Thus, the Provincial Government of Quirino paid public funds to Nakajima Trading before the latter delivered to it the heavy machinery subject of the contract. The prosecution argued that this advance payment, which violated Section 338 of the Local Government Code,[51] caused gross and manifest disadvantage.[52] The said provision prohibits local government units from making payments for goods not yet delivered and services not yet rendered, to wit:

Section 338. Prohibitions Against Advance Payments. - No money shall be paid on account of any contract under which no services have been rendered or goods delivered.

Gov. Co in fact admitted that this advance was made. However, in her defense, she maintained that she made the payment only after consulting Atty. Primitivo Marcos (Atty. Marcos), her private lawyer, who was not at that time in the employ of the province. Atty. Marcos advised Gov. Co that Section 338 did not apply to the transaction with Nakajima Trading because the advance was necessary for the Japanese supplier to begin reconditioning the equipment. She argued, once again on the basis of Arias, that her reliance in good faith on the opinion of Atty. Marcos should exonerate her from the charge of making an advance payment.[53] Thus, the next questions posed to the Court were:

Did the advance of forty (40%) percent of the total contract price, in violation of Sec. 338 of the Local Government Code, cause manifest and gross disadvantage to the Province of Quirino?[54]

If in the affirmative, did Governor Co have the right to rely on the legal opinion of Atty. Marcos, her private counsel?[55]

Again, the Court rules in the affirmative on the first question and in the negative on the second.

Notably, this is not the first time that the Court has adjudged an advance payment of public funds, made in violation of an express provision of law, to be commensurate with a violation of R.A. No. 3019.

In Plameras vs. People,[56] Provincial Governor Jovito C. Plameras was held liable for a violation of R.A. No. 3019 after he made an advance payment of P5,666,600.00 on behalf of Antique Province to answer for desks needed by the province's public schools. In that case, Governor Plameras signed a Purchaser-Seller Agreement with CKL as supplier and the provincial government as buyer. To fund the purchase, he applied for an Irrevocable Domestic Letter of Credit in the amount of P5,666,600.00 on behalf of the Provincial School Board. The application was approved and a letter of credit was issued in favor of the supplier. Full payment was effected soon after. Nonetheless, the province only received 1,838 out of the 5,246 desks that CKL agreed to deliver. Governor Plameras was therefore charged by the Office of the Deputy Ombudsman for the Visayas, which found probable cause to indict him for a violation of Section 3(e) of R.A. No. 3019. The Deputy Ombudsman particularly noted that payment was made before the desks were delivered, in violation of existing rules and regulations. After trial on the merits, the Sandiganbayan convicted Governor Plameras of violating Section 3(e) of R.A. No. 3019. He appealed his conviction to this Court. After assessing his arguments, the Court ruled to deny his appeal, holding that the Sandiganbayan did not err in convicting him, to wit:

As correctly observed by the Sandiganbayan, certain established rules, regulations, and policies of the Commission on Audit and those mandated under the Local Government Code of 1991 (R.A. No. 7160) were knowingly sidestepped and ignored by [Governor Plameras] which enabled CKL x x x to successfully get full payment for the school desks and armchairs, despite non-delivery—an act or omission evidencing bad faith and manifest partiality. (Emphasis and underscoring supplied)

One of the rules transgressed in Plameras, as well as in this case, was the prohibition against advance payments found in Section 338.

In the case at bench, Gov. Co effected the payment of P15,881,115.50, or 40% percent of the total contract price, before delivery by Nakajima Trading. The prosecution maintained that the advance payment was a clear and unequivocal breach of Section 338 of the Local Government Code.[57] The Sandiganbayan, for its part, held that this constituted gross and manifest disadvantage to the government.[58]

The Court finds no reason to deviate from the Sandiganbayan's ruling.

As correctly pointed out by Gov. Co herself, the purpose of the prohibition against advance payments is to ensure the receipt of goods or the performance of services.[59] Section 338 of the Local Government Code seeks to prevent situations where private suppliers can easily abscond with public funds. When a local government unit makes an advance payment, it risks pecuniary loss in the event of non-delivery or non-performance by the party with which it contracts. Such advances directly place the government at a disadvantage by effectively putting the supplier in control of the transaction, thus opening up the possibility that the latter will not make good its obligations ultimately leading to the pilferage of the public coffers.

Gov. Co also maintained that the prohibition against advance payments does not apply to cases where the government contracts with foreign suppliers. It was her position that these suppliers would naturally require earnest money as proof that the buyer was serious about pursuing with the transaction.[60]

However, contrary to Gov. Co's stance, the consequences of making an advance payment are even more dire when, as in this case, the government contracts with a foreign supplier. Unlike local suppliers, which may be made subject of coercive processes issued by Philippine courts, foreign suppliers may readily abscond with impunity. There would be no way to recover, through domestic channels, the funds disbursed in favor of foreign entities; local government units would thus be left without recourse against suppliers without any presence or assets in the Philippines. This is without a doubt disadvantageous to the government.

The Court finds that, here, the mere risk of losing such a substantial amount of money (i.e., P15,881,115.50) caused gross and manifest disadvantage to the Province of Quirino.

Public office is a public trust.[61] To maintain inviolate the public trust reposed in them, public officers must, in the performance of their duties, exercise the diligence of a good father of a family. This entails, inter alia, that they observe relevant laws and rules as well as exercise ordinary care and prudence in the disbursement of public funds.[62] Public funds, after all, are the property of the people and must be used prudently at all times with a view to prevent dissipation and waste.[63]

In this regard, Gov. Co failed miserably. As mentioned earlier, she advanced public funds in the amount of P15,881,115.50 in favor of Nakajima Trading, blatantly disregarding Section 338 of the Local Government Code. She neglected to abide by the law, which she, as a public officer, is bound to uphold. Thus, the Court holds that the Sandiganbayan did not err when it ruled that the advance of 40% of the total purchase price caused gross and manifest disadvantage to the Province of Quirino.

Next, the Court shall discuss Gov. Co's misplaced invocation of the Arias doctrine in relation to her reliance on the legal opinion of her lawyer, Atty. Primitivo Marcos.

To reiterate, Gov. Co argued that she merely depended in good faith on the judgment of Atty. Marcos, who opined that the transaction with Nakajima Trading was exempt from Section 338 of the Local Government Code. Again citing Arias, she maintained that she cannot be faulted for her reliance on his opinion because the question of whether the advance payment violated the Local Government Code was not within her competence since she is not a lawyer. Thus, she concluded that her good faith reliance on the legal opinion of Atty. Marcos should exonerate her from the charge.[64]

The argument deserves scant consideration.

The subordinates contemplated by the Arias doctrine are those public officers and employees who are actually under the control or supervision of the head of office concerned, or those who answer directly or indirectly to their superiors, who are in the employ of the same government agency. In other words, for the Arias doctrine to find application, both the superior and the subordinate must be public officers working for the same government office or agency.

In his cross-examination,[65] Atty. Marcos admitted that he was merely consulted by Gov. Co in his capacity as a private lawyer, to wit:

Q: Mr. witness, you said that you were the legal consultant of the accused in 1996, does it mean that you were a private counsel for the accused in 1996?
 
A: Yes, ma'am.
 
Q: So, you were not the official legal counsel of the Provincial Governor in 1996?
 
A: Yes, I was acting then as private legal consultant, ma'am.
 
Q: And you were not connected in any way with the province?
 
A: At that time, ma'am. (Emphasis and underlining supplied)

Given the foregoing admission, the Court cannot extend the protection afforded by the Arias doctrine to Gov. Co.

Moreover, Gov. Co cannot hide behind the cloak of ignorance or lack of familiarity with the provisions of the law.[66] It is settled in our jurisdiction that ignorance of the law excuses no one from compliance therewith.[67] Corollarily, a mistake of law cannot be used to justify an illegal act because everyone IS presumed to know the law and the consequences of its violation.[68]

Hence, Gov. Co's reliance on the legal opinion rendered by Atty. Marcos will not serve to exculpate her.

Anent the third act, the findings of the Sandiganbayan show that Nakajima Trading failed to comply with a stipulation in the agreement, which provided that the complete delivery of the heavy equipment had to be within ninety (90) days from the date payment was received. The record reveals that, through a letter of credit, full payment had been effected on February 14, 1996. Thus, the Japanese supplier had until May 14, 1996 to perform its obligation under the contract. However, it failed to do so. Nakajima Trading delivered the equipment in three (3) separate shipments. According to the Sandiganbayan, these shipments were made on April 10, 1996, June 10, 1996, and June 24, 1996.[69] Clearly, therefore, complete delivery was not made in accordance with the terms of the contract.

More, the prosecution established that, despite full payment of the contract price, the provincial government did not receive every unit of equipment due under the contract. Specifically, the evidence revealed that Nakajima Trading never delivered the set of tools and spare parts and that it failed to deliver the Ingersol-Rand SP 100 Vibratory Road Roller in accordance with the terms of the agreement. The record shows that Provincial Engineer Ringor inspected the machine upon delivery and that his inspection revealed that it was not in the condition agreed upon, the same being laden with dents and scratches.[70]

To the Court, this act only highlights Gov. Co's wanton negligence in the handling of public funds. Despite the lapse of the final day for delivery, Gov. Co chose to sit idly and wait for over a month for Nakajima Trading to ship the equipment that the province ordered. This shows that the governor was undoubtedly remiss in her duty to exercise heightened responsibility in dealing with public funds. This is precisely the lax attitude R.A. No. 3019 seeks to repress this is, in every way, the cavalier disposition that a public officer cannot display and that the Court cannot countenance.

Considering all the foregoing, Gov. Co must be held accountable for entering into a transaction grossly and manifestly disadvantageous to the government.

WHEREFORE, the petition is DENIED. The April 28, 2008 Decision and the September 24, 2008 Resolution of the Sandiganbayan in Criminal Case No. 24901, are AFFIRMED in toto.

The petitioner, Josie Castillo-Co, is hereby sentenced to an indeterminate penalty of Six (6) years and One (1) month, as minimum, to Six (6) years and Nine (9) months, as maximum, with perpetual disqualification from public office.

SO ORDERED.

Carpio (Chairperson),[*] Perlas-Bernabe, Caguioa, and J. Reyes, Jr.,[**] JJ., concur.


[*] Senior Associate Justice (Per Section 12, Republic Act No. 296, The Judiciary Act of 1948, As Amended)
[**] Designated additional Member per Special Order No. 2587, dated August 28, 2018.

[1] Rollo, pp. 8-81.

[2] Penned by Associate Justice Edilberto Sandoval with Associate Justices Francisco H. Villaruz, Jr. and Samuel Martires concurring; id. at 97-108.

[3] Id. at 172-179.

[4] Id. at 82.

[5] Id.

[6] Id.

[7] Id.

[8] Id. at 13.

[9] Id. at 82.

[10] Id. at 83.

[11] Id.

[12] Id. at 85.

[13] Id. at 82.

[14] Id. at 83.

[15] Id. at 84.

[16] Id.

[17] Id. at 82-87.

[18] Id. at 94-96.

[19] Id. at 94-95.

[20] Id. at 108.

[21] Id. at 100.

[22] Id. at 101.

[23] Id at. 102.

[24] Id. at 104.

[25] Id. at 172-179.

[26] Id. at 44.

[27] Reyes v. People, 641 Phil. 91, 103 (2010).

[28] 549 Phil. 783 (2007).

[29] Id. at 795.

[30] Rollo, p. 94.

[31] Id. at 13.

[32] Dans, Jr. v. People, 349 Phil. 434, 463 (1998).

[33] Crucillo v. Ombudsman, 552 Phil. 699, 724 (2007).

[34] Sajul v. Sandiganbayan, 398 Phil. 1082, 1105 (2000).

[35] Rollo, pp. 99-100.

[36] Id. at 99.

[37] Id. at 100.

[38] Id. at 36-43.

[39] Id.

[40] Mascuñana v. Provincial Board of Negros Occidental, 169 Phil. 385, 391 (1977).

[41] Rollo, p. 158.

[42] Id.

[43] 259 Phil. 794, 805 (1989).

[44] People v. Sandiganbayan (2nd Division), et al., 765 Phil. 845, 853 (2015).

[45] 749 Phil. 124 (2014).

[46] Id. at 151-152.

[47] Rollo, p. 70.

[48] Id. at 43.

[49] Id. at 101

[50] Id. at 38.

[51] Local Government Code, Book II, Title Five, Chapter 4, Sec. 338.

[52] Rollo, p. 102.

[53] Id. at 46-49.

[54] Id. at 44-56.

[55] Id.

[56] 717 Phil. 303 (2013).

[57] Rollo, p. 95.

[58] Id. at 102.

[59] Id. at 49.

[60] Id. at 105.

[61] CONSTITUTION, Article XI, Sec. 1.

[62] Concurring and dissenting opinion of Justice Arturo D. Brion, in Technical Education and Skills Development Authority v. Commission on Audit, 729 Phil. 60, 87 (2014).

[63] Yap v. Commission on Audit, 633 Phil. 174, 188 (2010).

[64] Rollo, p. 48.

[65] TSN, March 20, 2007, id. at 105.

[66] Office of the Deputy Ombudsman for Luzon v. Eufrocina Carlos Dionisio and Winifredo Salcedo Molina, G.R. No. 220700, July 10, 2017.

[67] CIVIL CODE, Article 3.

[68] In re: Petition to sign in the Roll of Attorneys, Medado, B.M. No. 2540, 718 Phil. 286, 291 (2013).

[69] Rollo, p. 102-103.

[70] Id. at 103.

Tuesday, October 15, 2019

Proof of a person's indebtedness to the judgment debtor.

Proof of a person's indebtedness to the judgment debtor may be in an affidavit or some other form so long as the judge is satisfied. Moreover, that proof other than an affidavit is sufficient, is clear from the 1997 Revised Rules of Criminal Procedure. Section 37 of Rule 39 provides that proof to the satisfaction of the court is sufficient to cause an examination of a judgment debtor's debtor.




THIRD DIVISION

G.R. No. 132245           
January 2, 2002

PNB MANAGEMENT and DEVELOPMENT CORP. (PNB MADECOR), petitioner, vs. R&R METAL CASTING and FABRICATING, INC., respondent.

QUISUMBING, J.:

Before us is a petition for review on certiorari seeking to annul the decision of the Court of Appeals in CA-G.R. No.49955, dated September 22, 1997,1 and its resolution dated December 29, 19972 denying reconsideration of said decision. The Court of Appeals affirmed the order of the Regional Trial Court of Manila, Branch 7, in Civil Case No.93-66675 that allowed the garnishment of amounts owed by petitioner to Pantranco North Express, Inc., respondent's judgment debtor.

It appears that on November 19,1993, respondent R&R Metal Casting and Fabricating, Inc. (R&R) obtained a judgment in its favor against Pantranco North Express, Inc. (PNEI). PNEI was ordered to pay respondent P213, 050 plus interest as actual damages, P50,000 as exemplary damages, 25 percent of the total amount payable as attorney's fees, and the costs of suit.3

However, the writ of execution was returned unsatisfied since the sheriff did not find any property of PNEI recorded at the Registries of Deeds of the different cities of Metro Manila. Neither did the sheriff receive a reply to the notice of garnishment he sent to PNB-Escolta.4

On March 27, 1995, respondent filed with the trial court a motion for the issuance of subpoenae duces tecum and ad testificandum requiring petitioner PNB Management and Development Corp. (PNB MADECOR) to produce and testify on certain documents pertaining to transactions between petitioner and PNEI from 1981 to 1995.

From the testimony of the representative of PNB MADECOR, it was discovered that NAREDECO, petitioner's forerunner, executed a promissory note in favor of PNEI for P7.8 million, and that PNB MADECOR also had receivables from PNEI in the form of unpaid rentals amounting to more than P7.5 million.

On the basis of said testimony, respondent filed with the trial court a motion for the application of funds or properties of PNEI, its judgment debtor, in the hands of PNB MADECOR for the satisfaction of the judgment in favor of respondent. Petitioner opposed the motion on the following grounds: (1) respondent failed to present the sheriff's return that would show that the writ of execution was unsatisfied; (2) petitioner's payables to PNEI under the promissory note were not yet due and demandable; (3) assuming the payables to be due and demandable, the obligation would be deemed extinguished by operation of law since PNEI is also indebted to petitioner in the form of unpaid rentals; and (4) the trial court cannot order the application of PNEI's payables to the judgment in favor of respondent, because petitioner has an adverse claim over said funds, in accordance with Section 45, Rule 39 of the Rules of Court.5

On May 22, 1995, the trial court issued an order garnishing the amount owed by petitioner to PNEI under the promissory note, to satisfy the judgment against PNEI and in favor of respondent.6 Petitioner appealed said order to the Court of Appeals, which affirmed the same in a decision dated September 22, 1997. The appellate court also denied petitioner's motion for reconsideration in a resolution dated December 29, 1997.

Hence, this petition, in which petitioner asserts that the Court of Appeals erred:

I

...IN THE INTERPRETATION OF THE RULES OF COURT WHEN IT RULED THA TAN AFFIDAVIT IS NOT A CONDITION PRECEDENT TO AN EXAMINATION OF A DEBTOR OF A JUDGMENT DEBTOR AS MENTIONED UNDER SECTION 39, RULE 39 OF THE RULES OF COURT.

II

...IN RULING THAT A DEMAND WAS MADE BY PNEI TO PETITIONER PNB MADECOR FOR THE PAYMENT OF THE PROMISSORY NOTE DATED 31 OCTOBER 1982.

III

...WHEN IT RULED THAT THE REQUISITES FOR LEGAL COMPENSATION AS SET FORTH UNDER ARTICLES 1277 AND 1278 OF THE CIVIL CODE DO NOT CONCUR IN THE CASE AT BAR.

IV

...[WHEN IT] MISCONSTRUED THE PROVISIONS OF SECTION 45, RULE 39 OF THE RULES OF COURT BY RULING THAT PETITIONER PNB-MADECOR, UPON BEING CITED IN AND SERVED WITH A NOTICE OF GARNISHMENT BECAME A FORCED INTERVENOR. HENCE, DENYING THE RIGHT OF THE LATTER TO VENTILATE ITS POSITION IN FULL-BLOWN TRIAL.7

At the outset, we note that petitioner had previously come before this Court raising the same issues it is raising now, in the case of PNB MADECOR v. Gerardo C. Uy, G.R. No.129598, promulgated on August 15, 2001. The respondent therein was different but the facts are essentially the same: respondent was PNEI's judgment debtor who sought to garnish petitioner's receivables from PNEI. Petitioner opposed, claiming legal compensation, and asserting that it could not have become a forced intervenor in the case by virtue of the order of garnishment. Petitioner likewise pointed out in that earlier case that PNEI had not made any demand for payment of the amount owed under the promissory note. The alleged demand letter sent by PNEI to PNB MADECOR in this case is the same demand letter that was presented in evidence in the previous case.8

The only issue that was not raised in the earlier case but is raised here is the alleged necessity of an affidavit stating that the judgment had not been satisfied, before a third party may be examined as regards its debt to the judgment debtor, pursuant to Section 39, Rule 39 of the Rules of Court (prior to its amendment in 1997).

The rule cited by petitioner provides:

SEC. 39. Examination of debtor of judgment debtor. -- After an execution against the property of a judgment debtor has been returned unsatisfied in whole or in part, and upon proof, by affidavit of a party or otherwise, to the satisfaction of the judge, that a person, corporation, or other legal entity has property of such judgment debtor, or is indebted to him, the judge may, by an order, require such person, corporation, or other legal entity, or any officer or member thereof, to appear before the judge, or a commissioner appointed by him, at a time and place within the province in which the order is served, to answer concerning the same. The service of the order shall bind all credits due the judgment debtor and all money and property of the judgment debtor in the possession or in the control of such person, corporation, or legal entity from the time of service; and the judge may also require notice of such proceedings to be given to any party to the action in such manner as he may deem proper. (Underscoring supplied.)

Petitioner apparently confuses a sheriff s return with the affidavit, or other proof, stating that another person is indebted to the judgment debtor. The cited rule does not refer to a sheriffs return that states whether or not the judgment has been satisfied. Rather, it speaks of an affidavit, or some other proof, that a third person is indebted to, or has property of, a judgment debtor.

Petitioner insists that an "affidavit of sheriffs return" must be presented before petitioner, the debtor of the judgment debtor, may be examined concerning its debt. It asserts that the phrase "by affidavit of a party or otherwise" means either an affidavit executed by a party to the litigation, or an affidavit executed by a third person. Petitioner is evidently only stretching the meaning of the rule to serve its purpose. The rule is clear: proof of a person's indebtedness to the judgment debtor may be in an affidavit or some other form, so long as the judge is satisfied. We cannot read into the rule what simply is not there. Moreover, that proof other than an affidavit is sufficient is clear from the 1997 Revised Rules of Civil Procedure. As pointed out by respondent, the present Section 37 of Rule 39 provides that "proof to the satisfaction of the court" is sufficient to cause an examination .of a judgment debtor's debtor.

As regards the second, third, and fourth issues raised by petitioner, we have squarely ruled on the same in the earlier case of PNB MADECOR v. Gerardo C. Uy, G.R. No. 129598, August 15,2001.

We find, however, that legal compensation could not have occurred because of the absence of one requisite in this case: that both debts must be due and demandable.

The CA observed:

Under the terms of the promissory note, failure on the part of NAREDECO (PNB MADECOR) to pay the value of the instrument 'after due notice has been made by PNEI would entitle PNEI to collect an 18% [interest] per annum from date of notice of demand.

Petitioner makes a similar assertion in its petition, that

xxx It has been stipulated that the promissory note shall earn an interest of 18% per annum in case NAREDECO, after notice, fails to pay the amount stated therein.

Petitioner's obligation to PNEI appears to be payable on demand, following the above observation made by the CA and the assertion made by petitioner. Petitioner is obligated to pay the amount stated in the promissory note upon receipt of a notice to pay from PNEI. If petitioner fails to pay after such notice, the obligation will earn an interest of 18 percent per annum.

Respondent alleges that PNEI had already demanded payment. The alleged demand letter reads in part:

We wish to inform you that as of August 31, 1984 your outstanding accounts amounted to PI0,376,078.67, inclusive of interest.

In accordance with our previous arrangement, we have conveyed in favor of the Philippine National Bank P7,884,921.10 of said receivables from you. With this conveyance, the unpaid balance of your account will be P2,491,157.57.

To forestall further accrual of interest, we request that you take up with PNB the implementation of said arrangement. xxx

We agree with petitioner that this letter was not one demanding payment, but one that merely informed petitioner of (l) the conveyance of a certain portion of its obligation to PNEI per a dacion en pago arrangement between PNEI and PNB, and (2) the unpaid balance of its obligation after deducting the amount conveyed to PNB. The import of this letter is not that PNEI was demanding payment, but that PNEI was advising petitioner to settle the matter of implementing the earlier arrangement with PNB.

xxx

Since petitioner's obligation to PNEI is payable on demand, and there being no demand made, it follows that the obligation is not yet due. Therefore, this obligation may not be subject to compensation for lack of a requisite under the law. Without compensation having taken place, petitioner remains obligated to PNEI to the extent stated in the promissory note. This obligation may undoubtedly be garnished in favor of respondent to satisfy PNEI's judgment debt.9 (Citations appearing in the original omitted. )

There is another alleged demand letter on record, dated January 24, 1990.10 It was addressed to Atty. Domingo A. Santiago, Jr., Senior Vice President and Chief Legal Counsel of PNB, and signed by Manuel Vijungco, chairman of the Board of Directors of PNEI. In said letter, PNEI requested offsetting of accounts between petitioner and PNEI. However, PNEI's own Assistant General Manager for Finance at that time, Atty .Loreto N. Tang, testified that the letter was not a demand letter.11

On the issue of whether or not petitioner became a forced intervenor in this case, we said in the earlier PNB MADECOR case:

...petitioner contends that it did not become a forced intervenor in the present case even after being served with a notice of garnishment. Petitioner argues that the correct procedure would have been for respondent to file a separate action against PNB MADECOR, per Section 43 of Rule 39 of the Rules of Court.12 Petitioner insists it was denied its right to ventilate its claims in a separate, full-blown trial when the courts a quo ruled that the abovementioned rule was inapplicable to the present case.

On this score, we had occasion to rule as early as 1921 in Tayabas Land Co. v. Sharruf,3 as follows:

...garnishment. ..consists in the citation of some stranger to the litigation, who is debtor to one of the parties to the action. By this means such debtor stranger becomes a forced intervenor; and the court, having acquired jurisdiction over his person by means of citation, requires him to pay his debt, not to his former creditor, but to the new creditor, who is creditor in the main litigation. It is merely a case of involuntary novation by the substitution of one creditor for another. Upon principle the remedy is a species of attachment or execution for reaching any property pertaining to a judgment debtor which may be found owing to such debtor by a third person.

Again, in Perla Compania de Seguros, Inc. v. Ramolete,14 we declared:

Through service of the writ of garnishment, the garnishee becomes a "virtual party" to, or a "forced intervenor" in, the case and the trial court thereby acquires jurisdiction to bind him to compliance with all orders and processes of the trial court with a view to the complete satisfaction of the judgment of the court.

xxx

There is no need for the institution of a separate action under Rule 39, Section 43, contrary to petitioner's claim. This provision contemplates a situation where the person allegedly holding property of (or indebted to) the judgment debtor claims an adverse interest in the property ( or denies the debt). In this case, petitioner expressly admits its obligation to PNEI.15 (Citations appearing in the original adjusted to conform to present decision.)

Petitioner, in fact, actively participated in the proceedings before the trial court by appearing during hearings, examining witnesses, and filing pleadings.16 It cannot now claim that it was denied the opportunity to present its side in a full-blown trial.

WHEREFORE, the petition is DENIED. The assailed decision and resolution of the Court of Appeals are AFFIRMED.

SO ORDERED.

Bellosillo, Mendoza, De Leon, Jr., JJ., concur.
Buena, J., on official leave.


Footnote

1 Rollo, pp. 39-48.
2 Id. at 50-51
3 Id. at 40.
4 Records, p. 101.
5 Rollo, p.16.
6 Records, pp. 208-209.
7 Rollo, pp. 19-20.
8 Records, p. 130.
9 PNB MADECOR v. Gerardo C. Uy, G.R. No. 129598, August 15,2001, pp. 12-14.
10 Records, pp. 148-149.
11 TSN, April 19, 1995, p. 26.
12 SEC. 43. Proceedings when indebtedness denied or another person claims the property. --If it appears that a person or corporation, alleged to have property of the judgment obligor or to be indebted to him, claims an interest in the property adverse to him or denies the debt, the court may authorize, by an order made to that effect, the judgment obligee to institute an action against such person or corporation for the recovery of such interest or debt, forbid a transfer or other disposition of such interest or debt within one hundred twenty (120) days from notice of the order, and may punish disobedience of such order as for contempt. Such order may be modified or vacated at any time by the court, which issued it, or by the court, in which the action is brought, upon such terms as may be just.
13 41 Phil. 382,387 (1921). This was reiterated in ... v. Barredo, 13 SCRA 744,746 (1965).
14 203 SCRA 487,492 (1991).
15 PNBMADECOR v. Gerardo C. Uy, supra, note 9, pp. 16-17.
16 See, e.g., records, pp. 97, 100, 108, 150-151, 155-168, 171-178. See also TSN, April 6, 1995, and TSN, April 16, 1995.

Examination of a child witness, Remedial Law

"The trend in procedural law is to give wide latitude to the courts in exercising control over the questioning of a child witness. The reasons are spelled out in our Rule on Examination of a Child Witness, which took effect on December 15, 2000, namely, (1) to facilitate the ascertainment of the truth, (2) to ensure that questions are stated in a form appropriate to the developmental level of the child, (3) to protect children from harassment or undue embarrassment, and (4) avoid waste of time. Leading questions in all stages of examination of a child are allowed if the same will further the interests of justice."



G.R. No. 137385               
January 23, 2002

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. RODITO DAGANIO, accused-appellant.

D E C I S I O N

PER CURIAM:

Accused-appellant Rodito Daganio, Sr., was charged with rape by his minor daughter, Virgie Daganio.1 The Information2 against him reads:

"That on or about the 6th day of September 1994, at Sapad, Lanao del Norte, Philippines, and within the jurisdiction of this Honorable Court, the above-named accused did then and there willfully, unlawfully and feloniously, by means of force, violence and intimidation, to wit: by then and there threatening to kill one VIRGIE DAGANIO if she will resist and report to her mother accused’s criminal designs, and thereafter lie with and have carnal knowledge of said VIRGIE DAGANIO, his 11 YEAR OLD daughter, against her will and consent.

CONTRARY to and in VIOLATION of Article 335 of the Revised Penal Code."

When arraigned, the accused-appellant entered a plea of not guilty.3 Trial on the merits followed.

The prosecution evidence came chiefly from the victim, Virgie Daganio, the victim’s mother, Laureta Daganio, and the examining physician, Dr. William Canoy.

The victim testified that her father (accused-appellant) raped her several times in their house. Her first defilement was in the month of December, but she could no longer recall what year it was.

The second rape took place in the evening of September 6, 1994. She was then 11 years old. That night, her mother (Laureta) was in Pikalawag, Lanao del Norte. The victim was playing with her younger siblings when the accused-appellant told her to go inside the house. She obeyed him. Inside their house, the accused-appellant first placed his finger in her vagina because it was too small. Next, he inserted his penis. Half of the penis penetrated her.4 After the sexual assault, he warned her not to tell anyone about the rape or he would cut her neck. Despite the threat, the victim related her harrowing experience to her mother, Laureta Daganio.5

The victim claimed that even before she was raped by the accused-appellant, her parents would quarrel a lot because the accused-appellant was always drunk. Sometimes her parents would fight because the accused-appellant "touched" her. There were also instances when the accused-appellant would hit Laureta with fist blows during their heated arguments.6

Laureta Daganio testified that the victim was eleven years old at the time the accused-appellant raped her. She further claimed that accused-appellant also raped their other daughter, Rita Daganio, when the latter was 15 years old. Laureta forgave the accused-appellant then. However, when she learned of the similar plight of the victim in the hands of the accused-appellant, she reported the incident to the authorities and assisted the victim in filing the complaint for rape against the accused-appellant.7

Dr. William Canoy testified that he conducted a medical examination on the victim on September 15, 1994. There were no fresh wounds in the vagina, although he found edema (slight swelling emission of the skin) around the victim’s labia majora and healed lacerations in the hymen at 6, 7, 1 and 8 o’clock positions. He opined that the edema could have been caused by hard or blunt objects or by a man’s penis.8

The accused-appellant denied the accusations of the victim. He claimed that on September 6, 1994, he was ill so he stayed in bed the whole day. When asked if he sexually molested the victim on said date, he replied that he did not know if he did because of his fever. He declared that he loves Laureta and that their relationship before September 6, 1994 was harmonious. He alleged that he never quarreled with her. He claimed he did not know why she filed the rape case against him.9

After trial, the court a quo rendered its judgment,10 finding the accused-appellant guilty as charged. He was sentenced to suffer the supreme penalty of death and ordered to indemnify the victim in the amount of Php 50,000.00.

Hence, the automatic review of the case.

The accused-appellant contends that:

"I.

THE COURT A QUO ERRED IN GIVING CREDENCE TO THE TESTIMONY OF VERGIE (sic) DAGANIO.

II.

THE COURT A QUO ERRED IN CONVICTING THE ACCUSED (APPELLANT) NOTWITHSTANDING THE FAILURE OF THE PROSECUTION TO PROVE HIS GUILT BEYOND REASONABLE DOUBT."

We affirm the assailed judgment.

The accused-appellant claims that the prosecution propounded leading questions on the victim. He asserts that had the trial court sustained the timely objections of his counsel, the victim would not have been able to establish the rape. We are not persuaded.

It is true that leading questions are generally not allowed and have little probative value. However, Section 10, Rule 132 of the Rules of Court11 provides:

"Sec. 10. Leading and misleading questions. - A question which suggests to the witness the answer which the examining party desires is a leading question. It is not allowed, except:

x x x           x x x          x x x

(c) When there is difficulty in getting direct and intelligible answers from a witness who is ignorant, or a child of tender years, or is of feeble mind, or a deaf mute.

x x x           x x x          x x x."

In the case at bar, the victim was twelve (12) years old when she testified in court. When most children her age were already in Grade VI of elementary education, she was only in Grade III. We can also glean from her testimony that she could not grasp the legal concept of "rape." Thus, the trial judge correctly allowed the prosecutor to ask leading questions to ferret out the truth.

The trend in procedural law is to give wide latitude to the courts in exercising control over the questioning of a child witness. The reasons are spelled out in our Rule on Examination of a Child Witness,12 which took effect on December 15, 2000, namely, (1) to facilitate the ascertainment of the truth, (2) to ensure that questions are stated in a form appropriate to the developmental level of the child, (3) to protect children from harassment or undue embarrassment, and (4) avoid waste of time. Leading questions in all stages of examination of a child are allowed if the same will further the interests of justice.

The totality of the evidence presented shows beyond reasonable doubt that the accused-appellant raped the victim on September 6, 1994. During the cross-examination, the victim gave a detailed and candid account of the rape incident. She testified as follows:13

"(ATTY. GUBAT):
Q: You said that your father used his fingers, how did your father used (sic) his fingers in raping you?

(VIRGIE):
A: He placed his fingers and his penis into my vagina.

Q: And your father’s fingers and penis were entrusted (sic) to your vagina at the same time is that right?
A: A little.

Q: What do you mean by a little?
A: It’s half.

Q: What do you mean by half?
A: Half of the penis.

Q: You said your father used his fingers, how many fingers were used?
A: Only one.

Q: Which of the fingers?
A: In the left hand.

Q: Which of the fingers in the left hand?
A: The middle finger.

Q: Have you seen the penis of your father?
A: Yes, sir."

(emphases ours)

The accused-appellant points out that Dr. William Canoy did not find fresh wounds on the genitalia of the victim. Allegedly, the absence of said wounds creates a doubt on her claim that she was raped on September 6, 1994. We disagree.

The records clearly show that accused-appellant had carnal knowledge of the victim. Dr. Canoy categorically stated that he found swelling in the genitalia of the victim that could have been caused by a male organ. The medical findings of the physician also showed that she had lacerations in her vagina at 6, 7, 1 and 8 o’clock positions.14 Said lacerations, whether healed or fresh, are the best physical evidence of forcible defloration.15

To discredit the victim, the accused-appellant claims it was easy for the victim to shout and ask for help as her siblings were in the vicinity when the rape took place. She did not. Thus, he submits that her accusations do not deserve credit. The allegation lacks merit.

A rape victim’s testimony is entitled to greater weight when she accuses a close relative of having raped her.16 Indeed, a young girl would not ordinarily file a complaint against anybody, much less her own father, if it were not true.17 Thus, the victim’s revelation that she had been raped, coupled with her voluntary submission to medical examination and willingness to undergo public trial where she could be compelled to give out details on an assault to her dignity cannot be dismissed as mere concoction.18

We also take judicial notice, and it can be considered of public knowledge, that the scene of the rape is not always or necessarily isolated or secluded. Lust is no respecter of time or place.19 It goes against human experience that a girl would fabricate a story which would drag herself as well as her family to a lifetime of dishonor, unless that is the truth, for her natural instinct is to protect her honor. More so, where her charges could mean the death of her own father, as in this case.20 Undoubtedly, the accused-appellant was correctly found guilty of raping his daughter.

Article 335 of the Revised Penal Code, as amended by Section 11 of R.A. No. 7659, reads:

"The death penalty shall also be imposed if the crime of rape is committed with any of the following attendant circumstances:

1. when the victim is under eighteen (18) years of age and the offender is a parent x x x ."

We have always stressed the rule that the minority of the victim and her relationship to the accused must be duly alleged and proved to justify the imposition of the death penalty.21 In some cases,22 we did not mete out the death penalty for failure of the prosecution to present the minor’s birth certificate or for non-presentation of independent evidence that would prove the victim’s age.

In the case at bar, the information alleged that the victim was then eleven (11) years old. This fact was established through the testimony of the victim’s own mother, Laureta Daganio, and admitted by the defense at the trial that the presentation of the victim’s Certificate of Live Birth was dispensed with at the instance of the defense counsel.23 Being the victim’s mother, Laureta Daganio has personal knowledge of the age of the victim. Thus, we fully agree with the trial court that the minority of the victim was duly established. We do not doubt her because there was no showing that she was motivated by ill feelings to accuse her own husband of a grievous offense.

In the case of People vs. Dela Cruz,24 this Court has also relied on the testimony of the victims’ mother as to the minority of her daughters and imposed the death penalty on the accused. We held:

"In the case at bar, however, the prosecution proved the minority age of the victims beyond reasonable doubt. Delia, the victim’s mother, categorically testified in the hearing of October 9, 1996, that her daughters were both fourteen (14) years of age at the time of the rape incidents complained of. Thus:

x x x           x x x          x x x

There is no reason to doubt Delia's testimony. As a mother, she has personal knowledge of the ages of her children. Her testimony was never challenged by the accused who could have presented the victims’ birth certificates. Delia’s testimony stood unrebutted by any other evidence. To be sure, this is not the first time that the Court is relying on the testimony of the victim’s mother to establish the minority age of the victim. In People vs. Balgos, where the rape victim was six (6) years of age, we relied on the testimony of the victim’s mother to prove the victim’s age. Reposing trust on the testimony of the victim’s mother, we imposed the death penalty on the accused-appellant."

Stare decisis et non quieta movere.25 The doctrine leaves us no choice but to apply the full force of the law and impose the supreme penalty of death on the accused-appellant. As in the case of Dela Cruz, supra, we have no reason to doubt the sincerity of the victim’s mother when she told the trial court that her daughter was only eleven (11) years old when the accused-appellant raped her.

We note that the trial court awarded civil indemnity to the victim in the amount of Php 50,000.00. The present rule is to award civil indemnity in the amount of at least Php 75,000.00.00 as the rape was qualified by any of the circumstances under which the death penalty is authorized under R.A. No. 7659.26

Further, the victim is entitled to moral damages, in the amount of Php 50,000.00 and exemplary damages, in the amount of Php 25,000.00. In rape cases, moral damages may be awarded to the victim in the criminal proceeding in such amount as the Court deems just, without the need for pleading or proof of the basis thereof. The fact that the complainant has suffered the scars of mental, physical and psychological trauma which constitute the basis for moral damages are too obvious to still require the recital thereof at the trial by the victim, since the Court itself even assume and acknowledge such agony on her part as a gauge of her credibility.27 Exemplary damages, on the other hand, may be imposed in the case of incestuous rape to deter other fathers with perverse tendency or aberrant sexual behavior from sexually abusing their own daughters.28

Four (4) members of the Court maintain their position that R.A. No. 7659, insofar as it prescribes the death penalty, is unconstitutional. Nevertheless, they submit to the ruling of the Court, by a majority vote, that the law is constitutional and that the death penalty should be imposed accordingly.

IN VIEW WHEREOF, the Decision of the Regional Trial Court of Kapatagan, Lanao Del Norte, (Branch 21), in Criminal Case No. 21-197, sentencing the accused-appellant, RODITO DAGANIO, to death is AFFIRMED.1âwphi1 The civil indemnity in the amount of Php 50,000.00 is modified and increased to Php 75,000.00. In addition, the accused-appellant is ordered to pay the amount of Php 50,000.00 as moral damages, and Php 25,000.00 as exemplary damages.

Pursuant to Section 25 of R.A. No. 7659, amending Section 83 of the Revised Penal Code, upon finality of this Decision, let the records of this case be forthwith forwarded to the Office of the President for possible exercise of pardoning power.

SO ORDERED.

Davide, Jr., C.J., Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza, Panganiban, Quisumbing, Pardo, Buena, Ynares-Santiago, De Leon, Jr., Sandoval-Gutierrez, and Carpio, JJ., concur.


Footnotes

1 Also referred to as Vergie Daganio in some parts of the records.
2 Rollo, p. 9.
3 Original Records, p. 19.
4 TSN, Virgie Daganio, September 26, 1995, pp. 4-5, 12.
5 Id., pp. 11-31; TSN, Laureta Daganio, November 14, 1995, p. 4.
6 TSN, Virgie Daganio, September 26, 1996, pp. 7-9.
7 TSN, Laureta Daganio, November 14, 1995, pp. 4-5.
8 TSN, William Canoy, March 18, 1998, pp. 3-5; cf. Exh. "C", Original Records, p. 2.
9 TSN, Rodito Daganio, September 15, 1998, pp. 2-4.
10 Rollo, pp. 15-25.
11 In Section 4 of the recently passed Rules on Examination of a Child Witness, a "child witness" has been defined as one who "at the time of giving testimony is below the age of eighteen (18) years." In child abuse cases, a "child witness" includes "one over eighteen (18) years but is found by the court as unable to fully take care of himself from abuse, neglect, cruelty, exploitation, or discrimination because of a physical or mental disability or condition."
12 Section 19.
13 TSN, Virgie Daganio, September 26, 1995, p. 12.
14 Supra note 8.
15 People vs. Acala, 307 SCRA 330 (1999).
16 People vs. Juntilla, 314 SCRA 568 (1999).
17 People vs. Sacapaño, 313 SCRA 650 (1999).
18 People vs. Molar, 286 SCRA 684 (1998).
19 People vs. Tundag, G.R. No. 135695-96, October 12, 2001.
20 Ibid.
21 People vs. Bayya, 327 SCRA 771 (2000).
22 See People vs. Javier, 311 SCRA 122, 140-141 (1999); People vs. Tipay, 329 SCRA 52 (2000); People vs. Cula, 329 SCRA 101 (2000); People vs. Brigildo, 323 SCRA 631 (2000).
23 TSN, Laureta Daganio, November 14, 1995, p. 4.
24 338 SCRA 582, 599 (2000).
25 It is best to adhere to decisions and not disturb questions put at rest.
26 People vs. Prades, 293 SCRA 411 (1998); People vs. Victor, 292 SCRA 186, 200-201 (1998); People vs. Dela Cruz, supra.
27 People vs. Prades, supra; People vs. Ramos, 296 SCRA 559 (1998).
28 People vs. Santos, G.R. Nos. 138308-10, September 26, 2001; People vs. Aquino, G.R. No. 136840-42, September 13, 2001; People vs. Catubig, G.R. No. 137842, August 23, 2001.