Taxability of campaign contributions - Atty Rodel C. Unciano

"Proceeding now to the taxability of campaign contributions, as circularized in Revenue Memorandum Circular (RMC) 38-2018 and as reiterated in RMC 31-2019, campaign contributions are not included in the taxable income of the candidate to whom they were given, the reason being that such contributions were given not for the personal expenditure or enrichment of the concerned candidate, but for the purpose of utilizing such contributions for the campaign. In order to be considered as exempt from income tax, the contributions must be utilized to cover a candidate’s expenditures for his/her electoral campaign.

Unutilized/excess campaign funds, that is, campaign contributions net of the candidate’s campaign expenditures, shall be considered as subject to income tax, and must be included in the candidate’s taxable income in the income tax return filed for the subject taxable year.

As a condition for the deductibility of the campaign expenditures, any candidate or political party or party-list group must file with the Commission on Elections (Comelec) a Statement of Contributions and Expenditures required under the Omnibus Election Code. Any candidate or political party or party-list group, whether winner or loser, who fails to comply with this requirement shall be automatically precluded from claiming such expenditures as deductions from the campaign contributions, making the entire amount directly subject to income tax.

Every candidate and treasurer of the political parties or party-list groups shall submit the Statement of Contributions and Expenditures to the Comelec and Revenue District Officer where the candidates or political parties or party-list groups are registered within 30 days after the election.

Income payments made by political candidates and political parties or party-list groups on their purchases of goods and services as campaign expenditures shall be subject to the five percent (5%) creditable withholding tax (CWT). Income payments made by individuals or juridical persons for their purchases of goods and services intended to be given as campaign contribution to political parties and candidates shall likewise be subject to five percent (5%) creditable withholding tax.

Expenses that were not subjected to the five percent (5%) CWT are not considered utilized campaign funds, and the candidates, political parties or party-list groups are precluded from claiming such expenditures as deductions from their campaign contributions. As such, the full amount corresponding to said expense shall be reported as unutilized campaign funds subject to income tax.

Under the Omnibus Election Code, contributions in cash or in kind to any candidates, political parties, or party-list groups are exempt from the imposition of Donor’s Tax. Only those donations or contributions that have been utilized/spent during the campaign period as set by the Comelec are exempt from donor’s tax. Donations utilized before or after the campaign period are subject to donor’s tax and not deductible as political contribution on the part of the donor.

***

THE  AUTHOR is a partner of DU-BALADAD AND ASSOCIATES LAW OFFICES (BDB Law), a member-firm of WTS Global.

The article is for general information only and is not intended, nor should be construed as a substitute for tax, legal or financial advice son any specific matter. Applicability of this article to any actual or particular tax or legal issue should be supported therefore by a professional study or advice. If you have any comments or questions concerning the article, you may e-mail the author at rodel.unciano@bdblaw.com.ph or call 8403-2001 local 140."

Read :

Taxability of campaign contributions
By Atty Rodel C. Unciano

https://www.bdblaw.com.ph/index.php/newsroom/articles/tax-law-for-business/799-taxability-of-campaign-contributions

Political campaign contributions

"Section 14 of R.A. No. 7166 entitled "An Act Providing for Synchronized National and Local Elections and for Electoral Reforms, Authorizing Appropriations Therefor, and for Other Purposes" provides as follows:

Statement of Contributions and Expenditures: Effect of Failure to File Statement. - Every candidate and treasurer of the political party shall, within thirty (30) days after the day of the election, file in duplicate with the offices of the Commission the full, true and ITEMIZED STATEMENT OF ALL CONTRIBUTIONS AND EXPENDITURES in connection with the election.

NO person ELECTED to any public office SHALL ENTER UPON THE DUTIES OF HIS OFFICE until he has FILED the statement of contributions and expenditures herein required.

The same prohibition shall apply if the political party which nominated the winning candidate fails to file the statement required herein within the period prescribed by this Act.

EXCEPT candidates for elective BARANGAY office, failure to file the statements or reports in connection with electoral contributions and expenditures as required herein shall constitute an ADMINISTRATIVE OFFENSE for which the offenders shall be liable to pay an ADMINISTRATIVE FINE ranging from One Thousand Pesos ( P1,000.00) to Thirty Thousand Pesos (P30,000.00), in the discretion of the Commission.

The fine shall be paid within thirty (30) days from receipt of notice of such failure; otherwise, it shall be enforceable by a writ of execution issued by the Commission against the properties of the offender.

It shall be the duty of every city or municipal election registrar to advise in writing, by personal delivery or registered mail, within five (5) days from the date of election all candidates residing in his jurisdiction to comply with their obligation to file their statements of contributions and expenditures.

For the commission of a SECOND OR SUBSEQUENT OFFENSE under this Section, the administrative fine shall be from Two Thousand Pesos (P2,000.00) to Sixty Thousand Pesos (P60,000.00), in the discretion of the Commission. In addition, the offender shall be subject to PERPETUAL DISQUALIFICATION TO HOLD PUBLIC OFFICE (Emphasis supplied).

To implement the provisions of law relative to election contributions and expenditures, the COMELEC promulgated on January 13, 1992 Resolution No. 2348 (Re: Rules and Regulations Governing Electoral Contributions and Expenditures in Connection with the National and Local Elections on

May 11, 1992). The pertinent provisions of said Resolution are:

Sec. 13. Statement of contributions and expenditures: Reminders to candidates to file statements. Within five (5) days from the day of the election, the Law Department of the Commission, the regional election director of the National Capital Region, the provincial election supervisors and the election registrars shall advise in writing by personal delivery or registered mail all candidates who filed their certificates of candidacy with them to comply with their obligation to file their statements of contributions and expenditures in connection with the elections. Every election registrar shall also advise all candidates residing in his jurisdiction to comply with said obligation (Emphasis supplied).

Sec. 17. Effect of failure to file statement. (a) No person elected to any public office shall enter upon the duties of his office until he has filed the statement of contributions and expenditures herein required.

The same prohibition shall apply if the political party which nominated the winning candidates fails to file the statement required within the period prescribed by law.

(b) Except candidates for elective barangay office, failure to file statements or reports in connection with the electoral contributions and expenditures as required herein shall constitute an administrative offense for which the offenders shall be liable to pay an administrative fine ranging from One Thousand Pesos (P1,000) to Thirty Thousand Pesos (P30,000), in the discretion of the Commission.

The fine shall be paid within thirty (30) days from receipt of notice of such failure; otherwise, it shall be enforceable by a writ of execution issued by the Commission against the properties of the offender.

For the commission of a second or subsequent offense under this section, the administrative fine shall be from Two Thousand Pesos (P2,000) to Sixty Thousand Pesos (P60,000), in the discretion of the Commission. In addition, the offender shall be subject to perpetual disqualification to hold public office.

Petitioner argues that he cannot be held liable for failure to file a statement of contributions and expenditures because he was a "non-candidate," having WITHDRAWN his certificates of candidacy three days after its filing. Petitioner posits that "it is . . . clear from the law that candidate must have entered the political contest, and should have either won or lost" (Rollo, p. 39).

Petitioner's argument is without merit.

Section 14 of R.A. No. 7166 states that "EVERY CANDIDATE" has the obligation to file his statement of contributions and expenditures.

Well-recognized is the rule that WHERE THE LAW DOES NOT DISTINGUISH, courts should not distinguish, Ubi lex non distinguit nec nos distinguere debemos (Philippine British Assurance Co. Inc. v. Intermediate Appellate Court, 150 SCRA 520 [1987]; cf Olfato v. Commission on Elections, 103 SCRA 741 [1981]). NO DISTINCTION is to be made in the application of a law where none is indicated (Lo Cham v. Ocampo, 77 Phil. 636 [1946]).

In the case at bench, as the LAW MAKES NO DISTINCTION OR QUALIFICATION as to whether the candidate PURSUED his candidacy or WITHDREW the same, the term "EVERY CANDIDATE" must be deemed to refer not only to a candidate who pursued his campaign, but also to one who withdrew his candidacy.

The COMELEC, the body tasked with the enforcement and administration of all laws and regulations relative to the conduct of an election, plebiscite, initiative, referendum, and recall (The Constitution of the Republic of the Philippines, Art. IX(C), Sec. 2[1]), issued Resolution No. 2348 in implementation or interpretation of the provisions of Republic Act No. 7166 on election contributions and expenditures. Section 13 of Resolution No. 2348 categorically refers to "all candidates who filed their certificates of candidacy."

Furthermore, Section 14 of the law uses the word "shall." As a general rule, the use of the word "shall" in a statute implies that the statute is MANDATORY, and imposes a DUTY which may be enforced , particularly if public policy is in favor of this meaning or where public interest is involved. We apply the general rule (Baranda v. Gustilo, 165 SCRA 757 [1988]; Diokno v. Rehabilitation Finance Corporation, 91 Phil. 608 [1952]).

The state has an interest in seeing that the electoral process is clean, and ultimately expressive of the true will of the electorate. One way of attaining such objective is to pass legislation regulating contributions and expenditures of candidates, and compelling the publication of the same. Admittedly, contributions and expenditures are made for the purpose of influencing the results of the elections (B.P. Blg. 881, Sec. 94; Resolution No. 2348, Sec. 1). Thus, laws and regulations prescribe what contributions are prohibited (B.P. Blg. 881, Sec. 95, Resolution No. 2348, Sec. 4), or unlawful (B.P. Blg. 881, Sec. 96), and what expenditures are authorized (B.P. Blg. 881, Sec. 102; R.A. No. 7166, Sec. 13; Resolution No. 2348, Sec. 7) or lawful (Resolution No. 2348, Sec. 8)."

Read:

G.R. No. 115245 July 11, 1995

JUANITO C. PILAR, petitioner,
vs.
COMMISSION ON ELECTIONS, respondent.

https://lawphil.net/judjuris/juri1995/jul1995/gr_115245_1995.html

When the law is clear and free from any doubt or ambiguity, there is no room for construction or interpretation.

"Xxx. In Rizal Commercial Banking Corporation v. Intermediate Appellate Court10 the Court enunciated:

It bears stressing that the first and fundamental duty of the Court is to apply the law. When the law is clear and free from any doubt or ambiguity, there is no room for construction or interpretation. As has been our consistent ruling, where the law speaks in clear and categorical language, there is no occasion for interpretation; there is only room for application (Cebu Portland Cement Co. v. Municipality of Naga, 24 SCRA 708 [1968])

Where the law is clear and unambiguous, it must be taken to mean exactly what it says and the court has no choice but to see to it that its mandate is obeyed (Chartered Bank Employees Association v. Ople, 138 SCRA 273 [1985]; Luzon Surety Co., Inc. v. De Garcia, 30 SCRA 111 [1969]; Quijano v. Development Bank of the Philippines, 35 SCRA 270 [1970]).

Only when the law is ambiguous or of doubtful meaning may the court interpret or construe its true intent.l^vvphi1.net Ambiguity is a condition of admitting two or more meanings, of being understood in more than one way, or of referring to two or more things at the same time. A statute is ambiguous if it is admissible of two or more possible meanings, in which case, the Court is called upon to exercise one of its judicial functions, which is to interpret the law according to its true intent."


G. R. No. 120721 February 23, 2005

MANUEL G. ABELLO, JOSE C. CONCEPCION, TEODORO D. REGALA, AVELINO V. CRUZ, petitioners,
vs.
COMMISSIONER OF INTERNAL REVENUE and COURT OF APPEALS, respondents.

https://lawphil.net/judjuris/juri2005/feb2005/gr_120721_2005.html

Gift tax on political campaign contributions

"Eighth Issue

Petitioners next contend that tax laws are construed liberally in favor of the taxpayer and strictly against the government. This rule of construction, however, does not benefit petitioners because, as stated, there is here no room for construction since the law is clear and unambiguous.

Finally, this Court takes note of the fact that subsequent to the donations involved in this case, Congress approved REPUBLIC ACT NO. 7166 on NOVEMBER 25, 1991, providing in SECTION 13 thereof that POLITICAL/ELECTORAL CONTRIBUTIONS, DULY REPORTED to the COMMISSION ON ELECTIONS, are NOT SUBJECT TO the payment of any GIFT TAX. This all the more shows that the political contributions herein made are subject to the payment of gift taxes, since the same were made PRIOR TO the exempting legislation, and Republic Act No. 7166 provides NO RETROACTIVE EFFECT on this point.

WHEREFORE, the petition is DENIED and the assailed Decision and Resolution of the Court of Appeals are AFFIRMED.

No costs.

SO ORDERED."

G.R. No. 120721 February 23, 2005
MANUEL G. ABELLO, JOSE C. CONCEPCION, TEODORO D. REGALA, AVELINO V. CRUZ, petitioners,
vs.
COMMISSIONER OF INTERNAL REVENUE and COURT OF APPEALS, respondents.

https://lawphil.net/judjuris/juri2005/feb2005/gr_120721_2005.html

Mediation and JDR in civil cases

"Xxx.

Mediation and JDR in civil cases

Tranquil G.S. Salvador III
January 14, 2022
The Manila Standard

Mediation is a method of settling disputes outside a court setting where a neutral third party, known as a mediator, acts as a link between the parties (Barron’s Law Dictionary). In the Philippines, court-annexed mediation (CAM) is conducted by referring the parties to the mediator of the Philippine Mediation Center Unit (PMCU) accredited by the Supreme Court.

On the other hand, Judicial Dispute Resolution (JDR) is the process wherein a judge known as the JDR Judge employs conciliation, mediation, or early neutral evaluation in order to settle a case at the pre-trial stage (Definition, Philippine Judicial Academy). Under the 2019 Amendment to the Rules of Civil Procedure (ARCP), the JDR judge is a judge other than the judge originally assigned to hear and try the case.
e CAM must be terminated no later than 30 days from the receipt of the referral order from the court and the JDR no later than 15 days from the receipt of such a referral order (Section 8, Chapter 2B and Section 3, 2C, A.M. No. 19-10-20-SC). If both the CAM and JDR are unsuccessful, the trial will proceed on the dates agreed upon during the pre-trial before the judge originally assigned to handle the case (Sections 8 and 9, Rule 18, ARCP).

The CAM shall be mandatory for all ordinary civil cases, including mediatable permissive or compulsory counterclaim or cross-claim. It shall also be mandatory for all special civil actions, except Declaratory Relief (Rule 63), Review of Decisions of COA or COMELEC (Rule 64), Certiorari, Prohibition and Mandamus (Rule 65), Quo Warranto (Rule 66), and Contempt (Rule 71) (Section 1(a)(b), Chapter 1).

CAM is mandatory in special proceedings cases involving the settlement of estate where the dispute involves claims against the estate, or the distribution or partition of the estate in intestate proceedings; and cases involving issues under the Family Code and other laws, in relation to support, custody, visitation, property relations, guardianship of minor children, and other issues which can be the subject of a compromise agreement (Section 1(c)(d), Chapter 1).
Intellectual property cases, commercial or intra-corporate controversy cases, and environmental cases are all mandated to go through CAM (Section 1(e)(f)(g), Chapter 1). However, environmental cases are not required to undergo JDR unless the judge of the court to which the case was originally filed is convinced that settlement is still possible (Section 2(a), Chapter 1).

All cases subject of CAM and appealed cases from the first level courts or metropolitan/municipal trial courts may be referred to JDR in areas declared as JDR sites. (Section 2(a)(b), Chapter 1). The other cases that may be referred to JDR are: (a) settlements of estate, testate and intestate; (b) cases of forcible entry and unlawful detainer; (c) civil cases involving title to, or possession of, or interest over real property; and (d) habeas corpus cases decided by the metropolitan/municipal trial courts in the absence of any Regional Trial Court Judge (Section 2(1) to (4), Chapter 1).

In all other actions or proceedings where compromise is not prohibited by law and there is a likelihood of settlement, either or both of the parties may, by oral manifestation or written motion after the pre-trial/preliminary conference, or at any stage of the proceedings, request the court to refer their dispute to CAM and JDR, provided that there are still factual issues to be resolved (Section 3, Chapter 1).

There are cases that cannot be resolved by a compromise and therefore may not be referred to CAM and JDR. These are: (a) cases involving the civil status of persons; validity of a marriage or legal separation, any grounds for legal separation, future support, the jurisdiction of courts, and future legitime; (b) habeas corpus petitions; (c) probate of a will; and (d) cases with pending applications for restraining orders or preliminary injunctions (Section 4, Chapter 1).

However, for marriage cases where the parties inform the court that they have agreed to undergo mediation on some aspects of the case, the court may allow mediation on the custody of minor children, separation of property, or support pendente lite. By mutual consent of the parties, restraining orders and preliminary injunctions can also be subject to mediation (Section 4, Chapter 1).

It shall be the duty of the Judge during Pre-Trial/Preliminary Conference to orient the parties and counsels on: (a) the CAM process; (b) their mandatory appearance during the mediation proceedings; (c) their duty to negotiate in good faith and to exert earnest efforts to settle the case; and (d) the consequences of and sanctions for failure to appear before the PMCU or any misconduct or misbehavior committed during the mediation proceedings (Section 2(a)(b), Chapter 2A).

The Judge shall inform the parties that in case there is no settlement during CAM, the case may be referred to another court for JDR if the former is convinced that settlement is still possible. The parties will be informed that the JDR Judge may conduct a non-binding early neutral evaluation on the merits of their respective cases (Section 2(c)(d), Chapter 2A).the initial appearance of the parties and counsels for CAM, the PMCU shall require them to present proof of payment of mediation fees and assist them in selecting a mutually acceptable mediator from among the roster of mediators in the PMCU (Sections 2 and 3, Chapter 2B). If the parties cannot jointly select a common mediator, the PMCU shall, in the presence of the parties, choose the mediator by lot from among the mediators present at the unit (Section 4, Chapter 2B).

The PMCU shall submit a Mediator’s Report to the court specifying the result of the mediation (Section 12, Chapter 2B). If a compromise agreement is reached by the parties, the judgment of the court approving the compromise agreement shall contain a statement that it was rendered through CAM. This is to distinguish the CAM judgment from the JDR judgment and vice versa. (Section 13, Chapter 2B, Section 9, Chapter 2C).

Upon receipt of the Mediator’s Report stating that no settlement was reached in CAM, the referring judge shall determine, in the hearing set for this purpose, if settlement is still possible, and if he is convinced that it is, refer the case to the JDR Judge (Section 1, Chapter 2C). Only those judges who have undergone skills-based training in JDR procedures and stationed in areas declared as JDR sites, are authorized to conduct JDR (Section 4, Chapter 2C).

The JDR Judge shall then conduct the JDR process as mediator, conciliator, and/or neutral evaluator to actively assist and facilitate negotiations among the parties for them to settle their dispute. As mediator and conciliator, he facilitates the settlement discussions between the parties to reconcile their differences (Section 5, Chapter 2C).

As a neutral evaluator, he assesses the relative strengths and weaknesses of each party’s case and makes a non-binding and impartial evaluation to guide the parties to a fair and mutually acceptable settlement of their dispute. If the case is not settled in JDR, the JDR Judge shall accomplish the JDR Report and return the case to the Judge for the continuation of the proceedings in court (Sections 5 and 8, Chapter 2C).

The trial court shall impose the following sanctions in case parties and counsels fail to appear during CAM or JDR proceedings: (a) dismissal of the case, when there is failure of the plaintiff and counsel to appear without valid cause; or (b) ex-parte presentation of plaintiff’s evidence and dismissal of the defendant’s counterclaim when there is failure of the defendant and counsel to appear without valid cause (Section 5, Chapter 2D).

The court may, likewise, impose other sanctions, including but not limited to censure, reprimand, contempt, or reimbursement by the absent party of the costs of the appearing party, including attorney’s fees for that day up to treble such costs, which are payable on or before the date of the re-scheduled setting. In the exercise of its sound discretion, the trial court may lift, set aside, or modify the sanctions previously imposed (Section 5 and 6, Chapter 2D).

Any and all matters discussed or communications made, including requests for mediation, and documents presented during CAM and JDR shall be privileged and confidential. The mediator or JDR Judge shall not, in any manner, record the proceedings. No transcript or minutes of the mediation proceedings shall be taken. If personal notes are taken for guidance, the notes shall be destroyed. Should such records exist, the same shall also be privileged and confidential (Section 7, Chapter 2D).

Parties to a dispute must take advantage of the CAM and JDR in order to save their and the court’s time and resources. It may not look like a complete victory for either the complainant or defendant based on the reliefs sought in their respective pleadings but it may terminate the case that causes anxiety, sleepless nights and emotional distress. Hence, it is a win-win solution.

Xxx."

Source:

https://manilastandard.net/opinion/columns/footnotes-by-tranquil-g-s-salvador-iii/314065991/mediation-and-jdr-in-civil-cases.html

Summary judgments in forfeiture cases

"Xxx.

Petitioners’ sham denials justify the application of summary judgment

As already settled in the Swiss Deposits Decision and reiterated in the discussion above as the law of the case, the lawful income of the Marcoses is only USD 304,372.43. As discussed in paragraph 9 of the Petition for Forfeiture, Annex V-21-b states that Arelma’s assets as of 19 May 1983 were worth USD 3,369,975.00.63 The entirety of the lawful income of the Marcoses represents only 9% of the entire assets of Arelma, which petitioners remain unable to explain.

In their Answer to the Petition for Forfeiture, petitioners employ the same tactic, consisting of general denials based on a purported lack of knowledge regarding the whereabouts of the Arelma assets. Paragraph 32 of the said pleading states:

Respondents specifically DENY paragraph 59 of the Petition insofar as it alleges that the Marcoses used their cronies and engaged in laundering their filthy riches for being false and conclusory of the truth being that the Marcoses did not engage in any such illegal acts and that all the properties they acquired were lawfully acquired; and specifically DENY the rest for lack of knowledge or information sufficient to form a belief as to the truth of the allegation since Respondents are not privy to the alleged transactions.64

This particular denial mimics petitioners’ similar denials of the allegations in the forfeiture Petition pertaining to the Swiss accounts and is practically identical to paragraphs 7 to 37 of the Answer. The Swiss Deposits Decision has characterized these as "sham" denials:

17. Respondents specifically DENY paragraph 18 of the Petition for lack of knowledge or information sufficient to form a belief as to the truth of the allegation since Respondents cannot remember with exactitude the contents of the alleged ITRs.

18. Respondents specifically DENY paragraph 19 of the Petition for lack of knowledge or information sufficient to form a belief as to the truth of the allegation since Respondents cannot remember with exactitude the contents of the alleged ITRs and that they are not privy to the activities of the BIR.

19. Respondents specifically DENY paragraph 20 of the Petition for lack of knowledge or information sufficient to form a belief as to the truth of the allegation since Respondents cannot remember with exactitude the contents of the alleged ITRs.

20. Respondents specifically DENY paragraph 21 of the Petition for lack of knowledge or information sufficient to form a belief as to the truth of the allegation since Respondents cannot remember with exactitude the contents of the alleged ITRs.

21. Respondents specifically DENY paragraph 22 of the Petition for lack of knowledge or information sufficient to form a belief as to the truth of the allegation since Respondents cannot remember with exactitude the contents of the alleged ITRs.

22. Respondents specifically DENY paragraph 23 insofar as it alleges that Respondents clandestinely stashed the country's wealth in Switzerland and hid the same under layers and layers of foundation and corporate entities for being false, the truth being that Respondents aforesaid properties were lawfully acquired.

23. Respondents specifically DENY paragraphs 24, 25, 26, 27, 28, 29 and 30 of the Petition for lack of knowledge or information sufficient to form a belief as to the truth of the allegation since Respondents were not privy to the transactions regarding the alleged Azio-Verso-Vibur Foundation accounts, except that as to Respondent Imelda R. Marcos she specifically remembers that the funds involved were lawfully acquired.

24. Respondents specifically DENY paragraphs 31, 32, 33, 34, 35, 36,37, 38, 39, 40, and 41 of the Petition for lack of knowledge or information sufficient to form a belief as to the truth of the allegations since Respondents are not privy to the transactions and as to such transaction they were privy to they cannot remember with exactitude the same having occurred a long time ago, except that as to Respondent Imelda R. Marcos she specifically remembers that the funds involved were lawfully acquired.

25. Respondents specifically DENY paragraphs 42, 43, 44, 45, and 46, of the Petition for lack of knowledge or information sufficient to form a belief as to the truth of the allegations since Respondents were not privy to the transactions and as to such transaction they were privy to they cannot remember with exactitude the same having occurred a long time ago, except that as to Respondent Imelda R. Marcos she specifically remembers that the funds involved were lawfully acquired.

26. Respondents specifically DENY paragraphs 49, 50, 51 and 52, of the Petition for lack of knowledge or information sufficient to form a belief as to the truth of the allegations since Respondents were not privy to the transactions and as to such transaction they were privy to they cannot remember with exactitude the same having occurred a long time ago, except that as to Respondent Imelda R. Marcos she specifically remembers that the funds involved were lawfully acquired.

Upon careful perusal of the foregoing, the Court finds that respondent Mrs. Marcos and the Marcos children indubitably failed to tender genuine issues in their answer to the petition for forfeiture. A genuine issue is an issue of fact which calls for the presentation of evidence as distinguished from an issue which is fictitious and contrived, set up in bad faith or patently lacking in substance so as not to constitute a genuine issue for trial. Respondents' defenses of "lack of knowledge for lack of privity" or "(inability to) recall because it happened a long time ago" or, on the part of Mrs. Marcos, that "the funds were lawfully acquired" are fully insufficient to tender genuine issues. Respondent Marcoses' defenses were a sham and evidently calibrated to compound and confuse the issues.65 (Emphasis supplied.)

In the case at bar, petitioners give the same stock answer to the effect that the Marcoses did not engage in any illegal activities, and that all their properties were lawfully acquired. They fail to state with particularity the ultimate facts surrounding the alleged lawfulness of the mode of acquiring the funds in Arelma (which totaled USD 3,369,975.00 back in 1983), considering that the entirety of their lawful income amounted only to USD 304,372.43, or only 9% of the entire Arelma fund. Then, as now, they employ what the Court in G.R. No. 152154 characterized as a "negative pregnant," not just in denying the criminal provenance of the Arelma funds, but in the matter of ownership of the said funds. As discussed by the Court in the first Republic case, cited by the Sandiganbayan:

Evidently, this particular denial had the earmark of what is called in the law on pleadings as a negative pregnant, that is, a denial pregnant with the admission of the substantial facts in the pleading responded to which are not squarely denied. It was in effect an admission of the averments it was directed at. Stated otherwise, a negative pregnant is a form of negative expression which carries with it an affirmation or at least an implication of some kind favorable to the adverse party. It is a denial pregnant with an admission of the substantial facts alleged in the pleading. Where a fact is alleged with qualifying or modifying language and the words of the allegation as so qualified or modified are literally denied, it has been held that the qualifying circumstances alone are denied while the fact itself is admitted.66

Due to the insufficiency of petitioners’ denial of paragraph 59 which in effect denies only the qualifying circumstances, and by virtue of the Court’s ruling in the Swiss Deposits Decision, petitioners are deemed to have admitted the factual antecedents and the establishment of Arelma. In paragraph 32 of their Answer, they only deny the first few sentences of paragraph 59, while conveniently neglecting to address subparagraphs 1 to 5 and the opening bank documents described in 5 (a) to (d) of the Petition for Forfeiture. Paragraphs 1 and 2 of the Petition discusses the establishment of a Panamanian company to be named either "Larema, Inc. or Arelma, Inc., or Relma, Inc.;" the appointment of several people as directors; and the opening of a direct account with Merrill Lynch. Paragraphs 3 to 5 also of the Petition for Forfeiture detail correspondences between a "J.L. Sunier" and a letter addressed to Malacañang with the salutation "Dear Excellency."

Regarding the averment of petitioners that they lack knowledge sufficient to form a belief as to the truth of the above allegations in the Petition for Forfeiture, the Court’s discussion in the Swiss Deposits Decision bears reiterating:

Here, despite the serious and specific allegations against them, the Marcoses responded by simply saying that they had no knowledge or information sufficient to form a belief as to the truth of such allegations. Such a general, self-serving claim of ignorance of the facts alleged in the petition for forfeiture was insufficient to raise an issue. Respondent Marcoses should have positively stated how it was that they were supposedly ignorant of the facts alleged.67

Petitioners cannot escape the fact that there is manifest disparity between the amount of the Arelma funds and the lawful income of the Marcoses as shown in the ITRs filed by spouses Marcos. The Swiss Deposits Decision found that the genuineness of the said ITRs and balance sheets of the Marcos spouses have already been admitted by petitioners themselves:

Not only that. Respondents’ answer also technically admitted the genuineness and due execution of the Income Tax Returns (ITRs) and the balance sheets of the late Ferdinand E. Marcos and Imelda R. Marcos attached to the petition for forfeiture, as well as the veracity of the contents thereof.

The answer again premised its denials of said ITRs and balance sheets on the ground of lack of knowledge or information sufficient to form a belief as to the truth of the contents thereof. Petitioner correctly points out that respondents' denial was not really grounded on lack of knowledge or information sufficient to form a belief but was based on lack of recollection. By reviewing their own records, respondent Marcoses could have easily determined the genuineness and due execution of the ITRs and the balance sheets. They also had the means and opportunity of verifying the same from the records of the BIR and the Office of the President. They did not.

When matters regarding which respondents claim to have no knowledge or information sufficient to form a belief are plainly and necessarily within their knowledge, their alleged ignorance or lack of information will not be considered a specific denial. An unexplained denial of information within the control of the pleader, or is readily accessible to him, is evasive and is insufficient to constitute an effective denial.68 (Footnotes omitted.)

We find that petitioners have again attempted to delay the goal of asset recovery by their evasiveness and the expedient profession of ignorance. It is well-established that a profession of ignorance about a fact that is necessarily within the pleader’s knowledge or means of knowing is as ineffective as no denial at all. On a similar vein, there is a failure by petitioners to properly tender an issue, which as correctly ruled by the Sandiganbayan, justifies the Republic’s resort to summary judgment.

Summary judgment may be allowed where there is no genuine issue as to any material fact and where the moving party is entitled to a judgment as a matter of law.69 In Yuchengco v. Sandiganbayan, the Court has previously discussed the importance of summary judgment in weeding out sham claims or defenses at an early stage of the litigation in order to avoid the expense and loss of time involved in a trial, viz:

Even if the pleadings appear, on their face, to raise issues, summary judgment may still ensue as a matter of law if the affidavits, depositions and admissions show that such issues are not genuine. The presence or absence of a genuine issue as to any material fact determines, at bottom, the propriety of summary judgment. A "genuine issue", as differentiated from a fictitious or contrived one, is an issue of fact that requires the presentation of evidence. To the party who moves for summary judgment rests the onus of demonstrating clearly the absence of any genuine issue of fact, or that the issue posed in the complaint is patently unsubstantial so as not to constitute a genuine issue for trial. 70

Even if in the Answer itself there appears to be a tender of issues requiring trial, yet when the relevant affidavits, depositions, or admissions demonstrate that those issues are not genuine but sham or fictitious, the Court is justified in dispensing with the trial and rendering summary judgment for plaintiff.71

Summary judgment, or accelerated judgment as it is sometimes known, may also call for a hearing so that both the movant and the adverse party may justify their positions. However, the hearing contemplated (with 10-day notice) is for the purpose of determining whether the issues are genuine or not, not to receive evidence of the issues set up in the pleadings. In Carcon Development Corporation v. Court of Appeals, 72 the Court ruled that a hearing is not de riguer. The matter may be resolved, and usually is, on the basis of affidavits, depositions, and admissions. This does not mean that the hearing is superfluous; only that the court is empowered to determine its necessity.

It is the law itself that determines when a summary judgment is proper. Under the rules, summary judgment is appropriate when there are no genuine issues of fact that call for the presentation of evidence in a full-blown trial.1âwphi1 Even if on their face the pleadings appear to raise issues, when the affidavits, depositions and admissions show that such issues are not genuine, then summary judgment as prescribed by the rules must ensue as a matter of law. What is crucial to a determination, therefore, is the presence or absence of a genuine issue as to any material fact. When the facts as pleaded appear uncontested or undisputed, then summary judgment is called for.73

Guided by the principles above indicated, we hold that under the circumstances obtaining in the case at bar, summary judgment is proper. The Sandiganbayan did not commit a reversible error in granting the corresponding 2004 Motion for Summary Judgment filed by respondent. The latter is well within its right to avail itself of summary judgment and obtain immediate relief, considering the insufficient denials and pleas of ignorance made by petitioners on matters that are supposedly within their knowledge.

These denials and pleas constitute admissions of material allegations under paragraph 59 of the Petition for Forfeiture – a tact they have employed repeatedly in Civil Case No. 0141. As discussed, the purpose of summary judgment is precisely to avoid long drawn litigations and useless delays.74 We also affirm the Sandiganbayan’s findings that the moving party, the Republic, is now entitled to judgment as a matter of law.

WHEREFORE, the instant Petition is DENIED. The Decision dated 2 April 2009 of the Sandiganbayan is AFFIRMED. All assets, properties, and funds belonging to Arelma, S.A., with an estimated aggregate amount of USD 3,369,975 as of 1983, plus all interests and all other income that accrued thereon, until the time or specific day that all money or monies are released and/or transferred to the possession of the Republic of the Philippines, are hereby forfeited in favor of Respondent Republic of the Philippines.

Xxx."

G.R. No. 189434 April 25, 2012

FERDINAND R. MARCOS, JR. Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, represented by the Presidential Commission on Good Government, Respondent.

x - - - - - - - - - - - - - - - - - - - - - - - x

G.R. No. 189505

IMELDA ROMUALDEZ-MARCOS, Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, Respondent.

Link:
https://www.lawphil.net/judjuris/juri2012/apr2012/gr_189434_2012.html

Separate judgments under Rule 36

"Xxx.

Thus, the other properties, which were subjects of the Petition for Forfeiture, but were not included in the 2000 Motion, can still be subjects of a subsequent motion for summary judgment. To rule otherwise would run counter to this Court’s long established policy on asset recovery which, in turn, is anchored on considerations of national survival.

E.O. 14, Series of 1986,51 and Section 1(d) of Proclamation No. 352 declared the national policy after the Marcos regime. The government aimed to implement the reforms mandated by the people: protecting their basic rights, adopting a provisional constitution, and providing for an orderly transition to a government under a new constitution. The said Proclamation further states that "The President shall give priority to measures to achieve the mandate of the people to recover ill-gotten properties amassed by the leaders and supporters of the previous regime and protect the interest of the people through orders of sequestration or freezing of assets or accounts." One of the "whereas" clauses of E.O. 14 entrusts the PCGG with the "just and expeditious recovery of such ill-gotten wealth in order that the funds, assets and other properties may be used to hasten national economic recovery." These clauses are anchored on the overriding considerations of national interest and national survival, always with due regard to the requirements of fairness and due process.

With the myriad of properties and interconnected accounts used to hide these assets that are in danger of dissipation, it would be highly unreasonable to require the government to ascertain their exact locations and recover them simultaneously, just so there would be one comprehensive judgment covering the different subject matters.

In any case, the Sandiganbayan rightly characterized their ruling on the 2004 Motion as a separate judgment, which is allowed by the Rules of Court under Section 5 of Rule 36:

Separate judgments.—When more than one claim for relief is presented in an action, the court, at any stage, upon a determination of the issues material to a particular claim and all counterclaims arising out of the transaction or occurrence which is the subject matter of the claim, may render a separate judgment disposing of such claim. The judgment shall terminate the action with respect to the claim so disposed of and the action shall proceed as to the remaining claims. In case a separate judgment is rendered, the court by order may stay its enforcement until the rendition of a subsequent judgment or judgments and may prescribe such conditions as may be necessary to secure the benefit thereof to the party in whose favor the judgment is rendered.53

Rule 35 on summary judgments, admits of a situation in which a case is not fully adjudicated on motion,54 and judgment is not rendered upon all of the reliefs sought. In Philippine Business Bank v. Chua,55 we had occasion to rule that a careful reading of its Section 4 reveals that a partial summary judgment was never intended to be considered a "final judgment," as it does not "[put] an end to an action at law by declaring that the plaintiff either has or has not entitled himself to recover the remedy he sues for." In this case, there was never any final or complete adjudication of Civil Case No. 0141, as the Sandiganbayan’s partial summary judgment in the Swiss Deposits Decision made no mention of the Arelma account.

Section 4 of Rule 35 pertains to a situation in which separate judgments were necessary because some facts existed without controversy, while others were controverted. However, there is nothing in this provision or in the Rules that prohibits a subsequent separate judgment after a partial summary judgment on an entirely different subject matter had earlier been rendered. There is no legal basis for petitioners’ contention that a judgment over the Swiss accounts bars a motion for summary judgment over the Arelma account.

Xxx."

G.R. No. 189434 April 25, 2012

FERDINAND R. MARCOS, JR. Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, represented by the Presidential Commission on Good Government, Respondent.

x - - - - - - - - - - - - - - - - - - - - - - - x

G.R. No. 189505

IMELDA ROMUALDEZ-MARCOS, Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, Respondent.

Link:

https://www.lawphil.net/judjuris/juri2012/apr2012/gr_189434_2012.html

Law of the case

"Xxx.

In any case, petitioners may no longer question the findings of the Sandiganbayan affirmed by the Supreme Court in the Swiss Deposits Decision, as these issues have long become the "law of the case" in the original Petition for Forfeiture. As held in Philippine Coconut Producers Federation, Inc. (COCOFED) v. Republic:42

Law of the case … is a term applied to an established rule that when an appellate court passes on a question and remands the case to the lower court for further proceedings, the question there settled becomes the law of the case upon subsequent appeal. It means that whatever is once irrevocably established as the controlling legal rule or decision between the same parties in the same case continues to be the law of the case, … so long as the facts on which such decision was predicated continue to be the facts of the case before the court.

Otherwise put, the principle means that questions of law that have been previously raised and disposed of in the proceedings shall be controlling in succeeding instances where the same legal question is raised, provided that the facts on which the legal issue was predicated continue to be the facts of the case before the court.

In the case at bar, the same legal issues are being raised by petitioners. In fact, petitioner Marcos Jr. admits outright that what he seeks is a reversal of the issues identical to those already decided by the Court in the Swiss Deposits Decision.43 He may not resuscitate, via another petition for review, the same issues long laid to rest and established as the law of the case.

Xxx."


G.R. No. 189434 April 25, 2012

FERDINAND R. MARCOS, JR. Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, represented by the Presidential Commission on Good Government, Respondent.

x - - - - - - - - - - - - - - - - - - - - - - - x

G.R. No. 189505

IMELDA ROMUALDEZ-MARCOS, Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, Respondent.

Link:
https://www.lawphil.net/judjuris/juri2012/apr2012/gr_189434_2012.html

Principle of immutability of judgments

"Xxx.

Petitioner Marcos, Jr. argues that there are genuine issues of fact as borne by the Pre-trial Order, Supplemental Pre-trial Order, and the Pre-trial Briefs of the parties. He laments that the Republic was unable to meet the necessary averments under the forfeiture law, which requires a comparison between the approximate amount of property acquired during the incumbency of Ferdinand Marcos, and the total amount of governmental salaries and other earnings.32 While the Petition contained an analysis of Ferdinand Marcos’s income from 1965 to 1986 (during his incumbency), there was purportedly no mention of the latter’s income from 1940 to 1965 when he was a practicing lawyer, congressman and senator; other earnings until the year 1985; and real properties that were auctioned off to satisfy the estate tax assessed by the Bureau of Internal Revenue.33

Petitioner Marcos, Jr. implores us herein to revisit and reverse our earlier ruling in the Swiss Deposits Decision and argues that the pronouncements in that case are contrary to law and its basic tenets. The Court in that case allegedly applied a lenient standard for the Republic, but a strict one for the Marcoses. He finds fault in the ruling therein which was grounded on public policy and the ultimate goal of the forfeiture law, arguing that public policy is better served if the Court gave more importance to the substantive rights of the Marcoses.

In accordance with the principle of immutability of judgments, petitioners can no longer use the present forum to assail the ruling in the Swiss Deposits Decision, which has become final and executory. Aside from the fact that the method employed by petitioner is improper and redundant, we also find no cogent reason to revisit the factual findings of the Sandiganbayan in Civil Case No. 0141, which this Court in the Swiss Deposits Decision found to be thorough and convincing. In the first place, using a Rule 45 Petition to question a judgment that has already become final is improper, especially when it seeks reconsideration of factual issues, such as the earnings of the late President from 1940 to 1965 and the existence of real properties that petitioners claim were auctioned off to pay the taxes. Secondly, petitioners never raised the existence of these earnings and real properties at the outset and never mentioned these alleged other incomes by way of defense in their Answer. In their Answer, and even in their subsequent pleadings, they merely made general denials of the allegations without stating facts admissible in evidence at the hearing. As will be discussed later, both the Sandiganbayan and the Supreme Court found that the Marcoses’ unsupported denials of matters patently and necessarily within their knowledge were inexcusable, and that a trial would have served no purpose at all.34

R.A. 1379 provides that whenever any public officer or employee has acquired during his incumbency an amount of property manifestly out of proportion to his salary as such public officer and to his other lawful income, said property shall be presumed prima facie to have been unlawfully acquired.35 The elements that must concur for this prima facie presumption to apply are the following: (1) the offender is a public officer or employee; (2) he must have acquired a considerable amount of money or property during his incumbency; and (3) said amount is manifestly out of proportion to his salary as such public officer or employee and to his other lawful income and income from legitimately acquired property.

Thus, in determining whether the presumption of ill-gotten wealth should be applied, the relevant period is incumbency, or the period in which the public officer served in that position. The amount of the public officer’s salary and lawful income is compared against any property or amount acquired for that same period. In the Swiss Deposits Decision, the Court ruled that petitioner Republic was able to establish the prima facie presumption that the assets and properties acquired by the Marcoses "were manifestly and patently disproportionate to their aggregate salaries as public officials."36

For a petition to flourish under the forfeiture law, it must contain the following:

(a) The name and address of the respondent.

(b) The public officer or employment he holds and such other public offices or employment which he has previously held.

(c) The approximate amount of property he has acquired during his incumbency in his past and present offices and employments.

(d) A description of said property, or such thereof as has been identified by the Solicitor General.

(e) The total amount of his government salary and other proper earnings and incomes from legitimately acquired property, and

(f) Such other information as may enable the court to determine whether or not the respondent has unlawfully acquired property during his incumbency.37 (Emphasis supplied)

Petitioners claim that the Republic failed to comply with subparagraphs c, d, and e above, because the latter allegedly never took into account the years when Ferdinand Marcos served as a war veteran with back pay, a practicing lawyer, a trader and investor, a congressman and senator. We find this claim to be a haphazard rehash of what has already been conclusively determined by the Sandiganbayan and the Supreme Court in the Swiss Deposits Decision. The alleged "receivables from prior years" were without basis, because Marcos never had a known law office nor any known clients, and neither did he file any withholding tax certificate that would prove the existence of a supposedly profitable law practice before he became President. As discussed in the Swiss Deposits Decision:

The Solicitor General made a very thorough presentation of its case for forfeiture:

x x x x x x x x x

4. Respondent Ferdinand E. Marcos (now deceased and represented by his Estate/Heirs) was a public officer for several decades continuously and without interruption as Congressman, Senator, Senate President and President of the Republic of the Philippines from December 31, 1965 up to his ouster by direct action of the people of EDSA on February 22-25, 1986.

5. Respondent Imelda Romualdez Marcos (Imelda, for short) the former First Lady who ruled with FM (Ferdinand Marcos) during the 14-year martial law regime, occupied the position of Minister of Human Settlements from June 1976 up to the peaceful revolution in February 22-25, 1986. She likewise served once as a member of the Interim Batasang Pambansa during the early years of martial law from 1978 to 1984 and as Metro Manila Governor in concurrent capacity as Minister of Human Settlements.1âwphi1

x x x x x x x x x

11. At the outset, however, it must be pointed out that based on the Official Report of the Minister of Budget, the total salaries of former President Marcos as President from 1966 to 1976 was ₱ 60,000 a year and from 1977 to 1985, ₱ 100,000 a year; while that of the former First Lady, Imelda R. Marcos, as Minister of Human Settlements from June 1976 to February 22-25, 1986 was ₱ 75,000 a year.38

The Sandiganbayan found that neither the late Ferdinand Marcos nor petitioner Imelda Marcos filed any Statement of Assets and Liabilities, as required by law, from which their net worth could be determined. Coupled with the fact that the Answer consisted of general denials and a standard plea of "lack of knowledge or information sufficient to form a belief as to the truth of the allegations" – what the Court characterized as "foxy replies" and mere pretense – fairness dictates that what must be considered as lawful income should only be the accumulated salaries of the spouses and what are shown in the public documents they submitted, such as their Income Tax Return (ITR) and their Balance Sheets. The amounts representing the combined salaries of the spouses were admitted by petitioner Imelda Marcos in paragraph 10 of her Answer, and reflected in the Certification dated May 27, 1986 issued by then Minister of Budget and Management Alberto Romulo:

Ferdinand E. Marcos, as President
1966-1976 at ₱ 60,000/year ₱ 660,000
1977-1984 at ₱ 100,000/year 800,000
1985 at ₱ 110,000/year 110,000
₱ 1,570,00


Imelda R. Marcos, as Minister
June 1976-1985 at ₱ 75,000/year ₱ 718,000


In addition to their accumulated salaries from 1966 to 1985 are the Marcos couple's combined salaries from January to February 1986 in the amount of ₱ 30,833.33. Hence, their total accumulated salaries amounted to ₱ 2,319,583.33. Converted to U.S. dollars on the basis of the corresponding peso-dollar exchange rates prevailing during the applicable period when said salaries were received, the total amount had an equivalent value of $304,372.43.39

The date contained in the ITRs and Balance Sheets filed by the Marcoses are summarized in Schedules A to D submitted as evidence by the Republic. Schedule A showed that from 1965 to 1984, the Marcoses reported Php 16,408,442.00 or USD 2,414,484.91 in total income, comprised of:
Income Source Amount Percentage
Official Salaries - ₱ 2,627,581.00 - 16.01%
Legal Practice - 11,109,836.00 - 67.71%
Farm Income - 149,700.00 - .91%
Others - 2,521,325.00 - 15.37%
Total ₱ 16,408,442.00 - 100.00%


The amount reported by the Marcos couple as their combined salaries more or less coincided with the Official Report submitted by the Minister of Budget. Yet what appeared anomalous was the Php 11,109,836 representing "Legal Practice," which accounted for 67% or more than three-fourths of their reported income. Out of this anomalous amount, Php 10,649,836, or 96% thereof, represented "receivables from prior years" during the period 1967 to 1984. The Court cited the Solicitor General’s findings:

In the guise of reporting income using the cash method under Section 38 of the National Internal Revenue Code, FM made it appear that he had an extremely profitable legal practice before he became a President (FM being barred by law from practicing his law profession during his entire presidency) and that, incredibly, he was still receiving payments almost 20 years after. The only problem is that in his Balance Sheet attached to his 1965 ITR immediately preceding his ascendancy to the presidency he did not show any Receivables from client at all, much less the ₱ 10.65-M that he decided to later recognize as income. There are no documents showing any withholding tax certificates. Likewise, there is nothing on record that will show any known Marcos client as he has no known law office. As previously stated, his net worth was a mere ₱ 120,000.00 in December, 1965. The joint income tax returns of FM and Imelda cannot, therefore, conceal the skeletons of their kleptocracy.40

In addition, the former President also reported a total of Php 2,521,325 which he referred to as "Miscellaneous Items" and "Various Corporations" under "Other Income" for 1972-1976. Spouses Marcos did not declare any income from any deposits that may be subject to a 5% withholding tax, nor did they file any capital gains tax returns from 1960 to 1965. The Bureau of Internal Revenue attested that there are no records pertaining to the tax transactions of the spouses in Baguio City, Manila, Quezon City, and Tacloban.

The Balance Sheet attached to the couple’s ITR for 1965 indicates an ending net worth of Php 120,000, which covered the year immediately preceding their ascendancy to the presidency. As previously mentioned, the combined salaries of the spouses for the period 1966 to 1986, or in the two decades that they stayed in power, totaled only USD 304,372.43. In stark contrast, as shown by Schedule D, computations establish the total net worth of the spouses for the years 1965 until 1984 in the total amount of USD 957,487.75, assuming that the income from legal practice is real and valid.41 The combined salaries make up only 31.79% of the spouses’ total net worth from 1965 to 1984. This means petitioners are unable to account for or explain more than two-thirds of the total net worth of the Marcos spouses from 1965 to 1984.

Xxx."

G.R. No. 189434 April 25, 2012

FERDINAND R. MARCOS, JR. Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, represented by the Presidential Commission on Good Government, Respondent.

x - - - - - - - - - - - - - - - - - - - - - - - x

G.R. No. 189505

IMELDA ROMUALDEZ-MARCOS, Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, Respondent.

Link:
https://www.lawphil.net/judjuris/juri2012/apr2012/gr_189434_2012.html

As FORFEITURE suits under R.A. 1379 are CIVIL in nature, it follows that Rule 35 of the Rules of Court on SUMMARY JUDGMENT may be applied to the present case.

"Xxx.

As early as Almeda v. Judge Perez,28 we have already delineated the difference between criminal and civil forfeiture and classified the proceedings under R.A. 1379 as belonging to the latter, viz:

"Forfeiture proceedings may be either civil or criminal in nature, and may be in rem or in personam. If they are under a statute such that if an indictment is presented the forfeiture can be included in the criminal case, they are criminal in nature, although they may be civil in form; and where it must be gathered from the statute that the action is meant to be criminal in its nature it cannot be considered as civil. If, however, the proceeding does not involve the conviction of the wrongdoer for the offense charged the proceeding is of a civil nature; and under statutes which specifically so provide, where the act or omission for which the forfeiture is imposed is not also a misdemeanor, such forfeiture may be sued for and recovered in a civil action."

In the first place a proceeding under the Act (Rep. Act No. 1379) does not terminate in the imposition of a penalty but merely in the forfeiture of the properties illegally acquired in favor of the state. (Sec. 6) In the second place the procedure outlined in the law leading to forfeiture is that provided for in a civil action. Thus there is a petition (Sec. 3), then an answer (Sec. 4), and lastly, a hearing. The preliminary investigation which is required prior to the filing of the petition, in accordance with Sec. 2 of the Act, is provided expressly to be one similar to a preliminary investigation in a criminal case. If the investigation is only similar to that in a criminal case, but the other steps in the proceedings are those for civil proceedings, it stands to reason that the proceeding is not criminal. xxx. (citations omitted)

Forfeiture cases impose neither a personal criminal liability, nor the civil liability that arises from the commission of a crime (ex delicto). The liability is based solely on a statute that safeguards the right of the State to recover unlawfully acquired properties.29 Executive Order No. 14 (E.O. No. 14), Defining the Jurisdiction Over Cases Involving the Ill-gotten Wealth of Former President Ferdinand Marcos, authorizes the filing of forfeiture suits that will proceed independently of any criminal proceedings. Section 3 of E.O. 14 empowered the PCGG to file independent civil actions separate from the criminal actions.30

Thus, petitioners cannot equate the present case with a criminal case and assail the proceedings before the Sandiganbayan on the bare claim that they were deprived of a "full-blown trial." In affirming the Sandiganbayan and denying petitioners’ Motion for Reconsideration in the Swiss Deposits Decision, the Court held:

Section 5 of RA 1379 provides:

The court shall set a date for a hearing which may be open to the public, and during which the respondent shall be given ample opportunity to explain, to the satisfaction of the court, how he has acquired the property in question.

And pursuant to Section 6 of the said law, if the respondent is unable to show to the satisfaction of the court that he has lawfully acquired the property in question, then the court shall declare such property forfeited in favor of the State.

x x x x x x x x x

A careful analysis of Section 5 of RA 1379 readily discloses that the word "hearing" does not always require the formal introduction of evidence in a trial, only that the parties are given the occasion to participate and explain how they acquired the property in question. If they are unable to show to the satisfaction of the court that they lawfully acquired the property in question, then the court shall declare such property forfeited in favor of the State. There is no provision in the law that a full blown trial ought to be conducted before the court declares the forfeiture of the subject property. Thus, even if the forfeiture proceedings do not reach trial, the court is not precluded from determining the nature of the acquisition of the property in question even in a summary proceeding.31

As forfeiture suits under R.A. 1379 are civil in nature, it follows that Rule 35 of the Rules of Court on Summary Judgment may be applied to the present case. This is consistent with our ruling in the Swiss Deposits Decision upholding the summary judgment rendered by the Sandiganbayan over the Swiss deposits, which are subject of the same Petition for Forfeiture as the Arelma assets.

Xxx."


G.R. No. 189434 April 25, 2012

FERDINAND R. MARCOS, JR. Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, represented by the Presidential Commission on Good Government, Respondent.

x - - - - - - - - - - - - - - - - - - - - - - - x


G.R. No. 189505

IMELDA ROMUALDEZ-MARCOS, Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, Respondent.

Link:
https://www.lawphil.net/judjuris/juri2012/apr2012/gr_189434_2012.html

Marcos ill-gotten wealth: Arelma and Swiss bank accounts

MARCOS ILL-GOTTEN WEALTH: The Supreme Court AFFIRMED the Decision, dated 2 April 2009, of the Sandiganbayan which FORFEITED in favor of the REPUBLIC all assets, properties, and funds belonging to ARELMA, S.A., with an estimated aggregate amount of USD 3,369,975 as of 1983, plus all INTERESTS AND ALL OTHER INCOME. The case discussed below also gave a background on the RELATED ILL-GOTTEN SWISS BANK ACCOUNTS of the Marcoses, totaling USD 356 MILLION.

2012 SUPREME COURT DECISION

THE decision of the Supreme Court, dated April 25, 2012, in the consolidated cases entitled "FERDINAND R. MARCOS, JR. Petitioner, vs. REPUBLIC OF THE PHILIPPINES, represented by the Presidential Commission on Good Government, Respondent" and "IMELDA ROMUALDEZ-MARCOS, Petitioner,

vs.REPUBLIC OF THE PHILIPPINES, Respondent", docketed as G.R. No. 189434 and G.R. No. 189505, written by former Chief Justice Maria Lourdes Sereno, referred to the underlying Sandiganbayan case docketed as CIVIL CASE NO. 0141 where the Sandiganbayan declared all assets and properties of ARELMA , S.A., an entity created by the late Ferdinand E. Marcos, FORFEITED in favor of the government.

The Supreme Court DENIED the foregoing petitions. It AFFIRMED the appealed Decision, dated 2 April 2009, of the Sandiganbayan which FORFEITED in favor of the Republic all assets, properties, and funds belonging to ARELMA, S.A., with an estimated aggregate amount of USD 3,369,975 as of 1983, plus all INTERESTS AND ALL OTHER INCOME that accrued thereon.

BACKGROUNDER

On 17 December 1991, the Republic, through the Presidential Commission on Good Government (PCGG), filed a Petition for Forfeiture before the Sandiganbayan pursuant to the forfeiture law, Republic Act No. 1379 in relation to Executive Order Nos. 1, 2 and 14. The petition was docketed as CIVIL CASE NO. 0141.

The Republic, through the PCGG and the Office of the Solicitor General (OSG), sought the declaration of SWISS BANK ACCOUNTS totaling USD 356 MILLION (now USD 658 MILLION), and two TREASURY NOTES worth USD 25 MILLION and USD 5 million, as ILL-GOTTEN WEALTH.

The Republic also sought the FORFEITURE of the ASSETS OF DUMMY CORPORATIONS and entities established by nominees of Marcos and his wife, Petitioner Imelda Romualdez-Marcos, as well as real and personal properties MANIFESTLY OUT OF PROPORTION to the spouses’ lawful income. This claim was based on evidence collated by the PCGG with the assistance of the UNITED STATES JUSTICE DEPARTMENT and the SWISS FEDERAL POLICE DEPARTMENT .

The Petition for Forfeiture described among others, a corporate entity by the name "ARELMA , Inc.," which maintained an account and portfolio in MERRILL LYNCH, NEW YORK , and which was purportedly organized for the same purpose of HIDING ILL-GOTTEN WEALTH .

Before the case was set for pretrial before the Sandiganbayan , the MARCOS CHILDREN and PCGG CHAIRPERSON Magtanggol Gunigundo SIGNED SEVERAL COMPROMISE AGREEMENTS (a General Agreement and Supplemental Agreements) all dated 28 December 1993 for a GLOBAL SETTLEMENT of the Marcos assets. One of the "whereas" clauses in the General Agreement specified that the Republic "obtained a JUDGMENT from the SWISS FEDERAL TRIBUNAL on DECEMBER 21, 1990, that the Three Hundred Fifty-six Million U.S. dollars (USD 356 MILLION ) belongs in principle to the Republic of the Philippines provided certain conditionalities are met xxx." This Decision was in turn based on the finding of ZURICH DISTRICT ATTORNEY Peter Cosandey that the DEPOSITS IN THE NAME OF THE FOUNDATIONS WERE OF ILLEGAL PROVENANCE.

IMELDA Marcos filed a manifestation before the Sandiganbayan claiming she was NOT A PARTY to the Motion for Approval of the Compromise Agreements, and that she OWNED 90% OF THE FUNDS while the remaining 10% belonged to the MARCOS ESTATE.

In a 19 September 2000 Decision, the Sandiganbayan INITIALLY GRANTED the 2000 Motion, declaring that the SWISS DEPOSITS held in escrow at the PNB were ill-gotten wealth, and, thus, FORFEITED in favor of the State.

In a Resolution dated 31 January 2002, the Sandiganbayan REVERSED its earlier ruling and denied the 2000 Motion.

Thereafter, alleging GRAVE ABUSE OF DISCRETION on the part of the Sandiganbayan in rendering its 31 January 2002 Resolution, the Republic filed a Petition for CERTIORARI with the Supreme Court, docketed as G.R. No. 152154, entitled Republic of the Philippines v. Sandiganbayan (for brevity, the "SWISS DEPOSITS DECISION").

Resolving the abovementioned petition of the Republic, the SUPREME Court, in G.R. No. 152154, SET ASIDE the assailed 31 January 2002 Sandiganbayan Resolution and REINSTATED the 19 September 2000 Decision of the Sandiganbayan, including the declaration that the SWISS DEPOSITS WERE ILL-GOTTEN WEALTH.

Thereafter, on 16 July 2004, the Republic filed before the Sandiganbayan a Motion for Partial Summary Judgment (2004 Motion) to declare "the funds, properties, shares in and interests of ARELMA, wherever they may be located, as ill-gotten assets and forfeited in favor of the Republic of the Philippines pursuant to R.A. 1379.

The Sandiganbayan FORFEITED the funds of ARELMA, INC., presently under management and/or in an account at the MERRILL LYNCH ASSET MANAGEMENT, NEW YORK, U.S.A., in the estimated aggregate amount of US$3,369,975.00 as of 1983, plus all INTERESTS and all other INCOME that accrued THEREON.

On 22 October 2009, Ferdinand "BONGBONG" Marcos, Jr. filed with the Supreme Court the instant Rule 45 Petition, questioning the said Sandiganbayan Decision.

One week later, IMELDA Marcos filed a separate Rule 45 Petition on essentially identical grounds, which was later CONSOLIDATED with the first Petition.

The two petitions questioned the aforementioned Sandiganbayan decision which FORFEITED the funds of ARELMA, INC. in favor of the Republic.

As earlier stated, the Supreme Court DENIED the consolidated petitions of Bongbong and Imelda Marcos.

FORFEITURE PROCEEDINGS ARE CIVIL IN NATURE

The crux of the present case devolved solely upon the RECOVERY OF ASSETS presumptively characterized by the law as ill-gotten, and owned by the State; hence, it is AN ACTION IN REM .

Forfeiture proceedings are ACTIONS IN REM and THEREFORE CIVIL IN NATURE. Proceedings under R.A. 1379 do NOT terminate in the imposition of a PENALTY but merely in the FORFEITURE of the properties illegally acquired in favor of the State.

FORFEITURE CASES impose neither a personal criminal liability, nor the civil liability that arises from the commission of a crime (ex delicto). The liability is based solely on a statute that safeguards the RIGHT OF THE STATE TO RECOVER UNLAWFULLY ACQUIRED PROPERTIES. Executive Order No. 14 (E.O. No. 14), Defining the Jurisdiction Over Cases Involving the Ill-gotten Wealth of Former President Ferdinand Marcos, authorizes the filing of FORFEITURE SUITS that will PROCEED INDEPENDENTLY OF ANY CRIMINAL PROCEEDINGS . Section 3 of E.O. 14 empowered the PCGG to file INDEPENDENT CIVIL ACTIONS SEPARATE FROM THE CRIMINAL ACTIONS .

FULL-BLOWN TRIAL NOT REQUIRED IN FORFEITURE CASES SO LONG AS THE PARTIES ARE GIVEN THE OCCASION TO PARTICIPATE AND EXPLAIN HOW THEY ACQUIRED THE PROPERTY IN QUESTION.

A careful analysis of Section 5 of RA 1379 readily discloses that the word "hearing" does not always require the formal introduction of evidence in a trial, only that the parties are given the occasion to participate and explain how they acquired the property in question. If they are unable to show to the satisfaction of the court that they lawfully acquired the property in question, then the court shall declare such property forfeited in favor of the State. There is no provision in the law that a full blown trial ought to be conducted before the court declares the forfeiture of the subject property. Thus, even if the forfeiture proceedings do not reach trial, the court is not precluded from determining the nature of the acquisition of the property in question even in a summary proceeding.

As forfeiture suits under R.A. 1379 are CIVIL in nature, it follows that RULE 35 of the Rules of Court on SUMMARY JUDGMENT may be applied to the present case. This is consistent with the earlier ruling of the Supreme Court in the SWISS DEPOSITS DECISION upholding the summary judgment rendered by the Sandiganbayan over the Swiss deposits, which are subject of the same Petition for Forfeiture as the ARELMA assets.

IMMUTABILITY OF JUDGMENT

FURTHER, the Supreme Court held that, In accordance with the PRINCIPLE OF IMMUTABILITY OF JUDGMENTS, PETITIONERS Bongbong and Imelda Marcos could no longer use the present forum to assail the ruling in the SWISS DEPOSITS DECISION, which had become FINAL AND EXECUTORY.

Aside from the fact that the method employed by petitioners was improper and redundant, the Supreme Court also ruled that it found no cogent reason to REVISIT THE FACTUAL FINDINGS OF THE SANDIGANBAYAN IN CIVIL CASE NO. 0141, which this Court in the Swiss Deposits Decision found to be THOROUGH AND CONVINCING.

In the first place, using a Rule 45 Petition to question a judgment that has already become FINAL is improper, especially when it seeks RECONSIDERATION OF FACTUAL ISSUES, such as the EARNINGS of the late President from 1940 TO 1965 and the existence of real properties that petitioners claimed were auctioned off to pay the taxes. Secondly, petitioners NEVER RAISED the existence of these earnings and real properties AT THE OUTSET and NEVER MENTIONED these alleged other incomes by way of defense in their ANSWER. In their Answer, and even in their subsequent pleadings, they merely made GENERAL DENIALS of the allegations without stating facts admissible in evidence at the hearing. Both the Sandiganbayan and the Supreme Court found that the Marcoses’ UNSUPPORTED DENIALS of matters patently and necessarily within their knowledge were INEXCUSABLE , and that a TRIAL WOULD HAVE SERVED NO PURPOSE AT ALL.

The Supreme Court held that R.A. 1379 provided that whenever any PUBLIC OFFICER or employee had acquired during his incumbency an amount of property MANIFESTLY OUT OF PROPORTION TO HIS SALARY as such public officer and to his other lawful income, said property shall be PRESUMED PRIMA FACIE to have been UNLAWFULLY ACQUIRED.

THE MARCOS SPOUSES NEVER FILED ANY STATEMENT OF ASSETS, LIABILITIES AND NETWORTH

The Sandiganbayan found that NEITHER the late Ferdinand Marcos nor petitioner Imelda Marcos filed any STATEMENT OF ASSETS AND LIABILITIES , as required by law, from which their net worth could be determined. Coupled with the fact that the Answer consisted of GENERAL DENIALS and a standard plea of "lack of knowledge or information sufficient to form a belief as to the truth of the allegations" – what the Court characterized as "foxy replies" and mere pretense – fairness dictates that what must be considered as LAWFUL INCOME should only be the accumulated salaries of the spouses and what are shown in the public documents they submitted, such as their INCOME TAX RETURN (ITR) and their BALANCE SHEETS.

TE LAWFUL INCOME OF THE MARCOS SPOUSES AMOUNTED TO MERELY $304,372.43.30

The amounts representing the combined salaries of the spouses were admitted by petitioner Imelda Marcos in paragraph 10 of her Answer, and reflected in the Certification dated May 27, 1986 issued by then Minister of Budget and Management Alberto Romulo:

Ferdinand E. Marcos, as President

1966-1976 at ₱ 60,000/year ₱ 660,000
1977-1984 at ₱ 100,000/year 800,000
1985 at ₱ 110,000/year 110,000
₱ 1,570,000

Imelda R. Marcos, as Minister

June 1976-1985 at ₱ 75,000/year ₱ 718,000

In addition to their accumulated salaries from 1966 to 1985 were the Marcos couple's combined salaries from January to February 1986 in the amount of ₱30,833.33. Hence, their total accumulated salaries amounted to ₱ 2,319,583.33. Converted to U.S. dollars on the basis of the corresponding peso-dollar exchange rates prevailing during the applicable period when said salaries were received, the total amount had an equivalent value of $304,372.43.30.

PRIMA FACIE PRESUMPTION: THE ASSETS AND PROPERTIES ACQUIRED BY THE MARCOSES WERE MANIFESTLY AND PATENTLY DISPROPORTIONATE TO THEIR AGGREGATE SALARIES AS PUBLIC OFFICIALS

The Supreme Court reiterated that the Republic was able to establish the PRIMA FACIE PRESUMPTION that the assets and properties acquired by the Marcoses were MANIFESTLY AND PATENTLY DISPROPORTIONATE to their aggregate salaries as public officials. The Republic presented further evidence that they had bigger deposits beyond their lawful incomes, foremost of which were the SWISS ACCOUNTS deposited in the names of FIVE FOUNDATIONS spirited away by the couple to different countries. Petitioners Bongbong and Imelda Marcos thus FAILED TO OVERTURN THIS PRESUMPTION when they merely presented VAGUE DENIALS and pleaded "lack of sufficient knowledge" in their Answer.

LAW OF THE CASE

PETITIONERS Bongbong and Imelda Marcos may no longer question the findings of the Sandiganbayan, affirmed by the Supreme Court in the Swiss Deposits Decision, as these issues have long become the "LAW OF THE CASE" in the original Petition for Forfeiture.

LAW OF THE CASE is a term applied to an established rule that when an APPELLATE COURT passes on a question and REMANDS the case to the LOWER COURT FOR FURTHER PROCEEDINGS , the question there SETTLED becomes the LAW OF THE CASE upon SUBSEQUENT APPEAL. It means that whatever is once irrevocably established as the CONTROLLING legal rule or decision between the SAME PARTIES in the SAME CASE continues to be the law of the case, so long as the facts on which such decision was predicated continue to be the facts of the case before the court.

The principle means that QUESTIONS OF LAW that have been PREVIOUSLY RAISED AND DISPOSED OF in the proceedings shall be CONTROLLING IN SUCCEEDING INSTANCES where the SAME legal question is raised, PROVIDED that the facts on which the legal issue was predicated continue to be the facts of the case before the court.

NATIONAL POLICY TO RECOVER ILL-GOTTEN PROPERTIES AMASSED BY THE LEADERS AND SUPPORTERS OF THE MARCOS REGIME

E.O. 14, Series of 1986, and Section 1(d) of Proclamation No. 352 declared the national policy after the ouster of the the Marcos regime in 1986. The government aimed to implement the REFORMS mandated by the people: protecting their BASIC RIGHTS, adopting a PROVISIONAL CONSTITUTION , and providing for an ORDERLY TRANSITION to a government under a NEW CONSTITUTION . The said Proclamation further states that "The President shall give PRIORITY to measures to achieve the mandate of the people to RECOVER ILL-GOTTEN PROPERTIES amassed by the leaders and supporters of the PREVIOUS REGIME and protect the interest of the people through orders of SEQUESTRATION or FREEZING OF ASSETS OR ACCOUNTS ." One of the "whereas" clauses of E.O. 14 entrusts the PCGG with the "just and expeditious RECOVERY OF SUCH ILL-GOTTEN WEALTH in order that the funds, assets and other properties may be used to hasten NATIONAL ECONOMIC RECOVERY." These clauses are anchored on the overriding considerations of NATIONAL INTEREST and NATIONAL SURVIVAL, always with due regard to the requirements of FAIRNESS and DUE PROCESS .

SUMMARY JUDGMENT IN CIVIL CASES FOR THE FORFEITURE OF ILL-GOTTEN WEALTH CASES ALLOWED

The petitioners Bong and Imelda Marcos had again attempted to DELAY THE GOAL OF ASSET RECOVERY by their EVASIVENESS and the EXPEDIENT PROFESSION OF IGNORANCE.

A profession of ignorance about a fact that is necessarily WITHIN THE PLEADER’S KNOWLEDGE OR MEANS OF KNOWING is as ineffective as NO DENIAL AT ALL.

On a similar vein, there was a failure by PETITIONERS Bongbong and Imelda Marcos to properly TENDER AN ISSUE , which, as correctly ruled by the Sandiganbayan, JUSTIFIED the Republic’s resort to SUMMARY JUDGMENT.

SUMMARY JUDGMENT may be ALLOWED where there is NO GENUINE ISSUE as to ANY MATERIAL FACT and where the moving party is ENTITLED to a judgment as a MATTER OF LAW.

Summary JUDGMENT is important in weeding out SHAM CLAIMS OR DEFENSES at an early stage of the litigation in order to avoid the expense and loss of time involved in a trial.

Even if the pleadings appear, on their face, to raise issues, summary judgment may still ensue as a matter of law if the AFFIDAVITS , DEPOSITIONS and ADMISSIONS show that such issues are NOT GENUINE. The presence or absence of a genuine issue as to any material fact determines, at bottom, the propriety of summary judgment.

A "GENUINE ISSUE", as differentiated from a fictitious or contrived one, is an issue of fact that REQUIRES THE PRESENTATION OF EVIDENCE.

Even if in the Answer itself there appears to be a tender of issues requiring trial, yet when the relevant AFFIDAVITS, DEPOSITIONS , or ADMISSIONS demonstrate that those issues are NOT GENUINE BUT SHAM OR FICTITIOUS , the Court is justified in DISPENSING WITH THE TRIAL and RENDERING SUMMARY JUDGMENT for plaintiff.

Summary judgment, or ACCELERATED JUDGMENT as it is sometimes known, may also call for a hearing so that both the movant and the adverse party may justify their positions. However, the hearing contemplated (with 10-day notice) is for the purpose of determining WHETHER THE ISSUES ARE GENUINE OR NOT , not to receive evidence of the issues set up in the pleadings. A hearing is not de riguer. The matter may be resolved, and usually is, on the basis of AFFIDAVITS , DEPOSITIONS , and ADMISSIONS . This does not mean that the hearing is superfluous; only that the court is empowered to determine its necessity.

The Supreme Court held that, guided by the principles above indicated, SUMMARY JUDGMENT WAS PROPER . The SANDIGANBAYAN DID NOT COMMIT A REVERSIBLE ERROR IN GRANTING THE 2004 MOTION FOR SUMMARY JUDGMENT filed by the Republic.

The Republic was well within its right to avail itself of summary judgment and obtain immediate relief, considering the INSUFFICIENT DENIALS AND PLEAS OF IGNORANCE made by petitioners on matters that were supposedly WITHIN THEIR KNOWLEDGE.

These denials and pleas constituted ADMISSIONS of material allegations under paragraph 59 of the Petition for Forfeiture – a tactic the petitioners Bongbong and Imelda Marcos had employed repeatedly in Civil Case No. 0141.

As discussed, the purpose of summary judgment is precisely TO AVOID LONG DRAWN LITIGATIONS AND USELESS DELAYS. The Supreme Court also affirmed the Sandiganbayan’s findings that the moving party, the Republic, was ENTITLED TO JUDGMENT AS A MATTER OF LAW.

SOURCE :

R. No. 189434 April 25, 2012

FERDINAND R. MARCOS, JR. Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, represented by the Presidential Commission on Good Government, Respondent.

x - - - - - - - - - - - - - - - - - - - - - - - x

G.R. No. 189505

IMELDA ROMUALDEZ-MARCOS, Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, Respondent.

LINK :

https://www.lawphil.net/judjuris/juri2012/apr2012/gr_189434_2012.html