This is a Petition for
Certiorari under Rule 65 of
the 1997 Revised Rules of Court seeking the reversal of the Ombudsman's
Resolution
1
dated October 16, 2000, dismissing the criminal complaint (docketed as
OMB-0-97-1138, entitled
Salvador v. Tabasondra, et
al.) against private respondents Ulpiano Tabasondra, Enrique
M. Herbosa, P.O. Domingo, Zosimo C. Malabanan, Arsenio S. Lopez, Romeo
V. Reyes, Nilo Roa, Heradeo Guballa, Florita T. Shotwell, Benigno del
Rio, Juan F. Trivino, Salvador B. Zamora II, and John Does
2 for violation of
Section 3(e) and (g) of Republic Act No. (RA) 3019 (otherwise known as
the Anti-Graft and Corrupt Practices Act). Petitioner Presidential Ad
Hoc Fact-Finding Committee on Behest Loans also prays that we reverse
the Order,
3
dated February 27, 2001, of the Ombudsman denying petitioner's Motion
for Reconsideration of November 24, 2000.
The
petitioner is a government agency created under Administrative Order No.(
AO) 13 on October 8, 1992 by then President Fidel
V. Ramos. It was tasked to inventory all behest loans,
determine the parties involved and recommend the appropriate actions
that should be taken.
4 Under the law, behest loans entail both civil
and criminal liabilities. President Ramos later issued Memorandum Order
No. (
MO) 61, dated November 9, 1992, expanding the
functions of the Committee to include the inventory and review of all
non-performing loans, whether behest or non-behest. The memorandum also
provided the following criteria for determining a behest
loan:
- It is
undercollaterized (sic).
- The
borrower corporation is undercapitalized.
- Direct or indirect endorsement by high government officials like presence of
marginal notes.
- Stockholders, officers or agents of the borrower corporation are identified as cronies.
- Deviation of use of loan proceeds from the purpose
intended.
- Use of corporate layering.
- Non-feasibility of the project for which financing
is being sought.
- Extra-ordinary speed in which the
loan release was made.
Pursuant to its
mandate under AO 13 and MO 61, the petitioner investigated a loan
guarantee agreement between Coco-Complex Philippines, Inc. (
CCPI), a domestic corporation in the business of
manufacturing oil, and the National Investment Development Corporation (
NIDC), the investment subsidiary of the Philippine
National Bank (
PNB)
5 The CCPI sought to have NIDC guarantee a loan
payable to Fried Krupp of Germany for the turn-key purchase of an oil
mill. On January 17, 1968, the NIDC issued Board Resolution No. 26
approving a guarantee agreement in favor of CCPI for the amount of
DM7.4M plus interest at the annual rate of 6 1/4 %, or a total amount of P9,277,080.00. On March 12, 1969, the parties signed the Guaranty
Agreement.
6 As
of March 31, 1992, the Statement of Deficiency Claim disclosed that CCPI had an outstanding obligation of
P205,889,545.76.
The petitioner, through Atty.
Orlando Salvador, filed a Sworn Statement,
7 dated June 5, 1997, before the Ombudsman
against Ulpiano Tabasondra, Enrique M. Herbosa, Zosimo C. Malabanan,
P.O. Domingo, and/or all officers and members of the Board of Directors
of the Development Bank of the Philippines (
DBP),
8 Makati City; and Arsenio S. Lopez, Romeo V.
Reyes, Nilo Roa, Heradeo Guballa, Benigno del Rio, Juan Triviño, and/or
all officers and stockholders of CCPI. The petitioner alleged
that the processing of the original loan was attended with haste
considering that the CCPI was incorporated on July 12, 1967, and the
Letter of Guarantee was approved in principle by the NIDC Board of
Directors as early as September 20, 1967. It also claimed that the loan was without sufficient collateral at the time the loan
guarantee was approved. CCPI's existing assets of P495,300.00 and assets to be acquired (turn-key cost of coconut mill) amounting to
P6,986,031.00 had an aggregate sum of P7,481,331.00. Nevertheless, the
NIDC considered this sufficient collateral for a loan of P9,277,080.00.
The petitioner also pointed out that the loan was undercapitalized since at the time the NIDC granted the loan guarantee, the paid-up capital
was only P2,111,000.00.
The petitioner further
relayed in its Complaint that the NIDC granted CCPI an additional loan,
restructuring and equity conversion of outstanding obligations, without
sufficient collateral and adequate capital to ensure CCPI's viability
and its ability to repay its loans. On November 25, 1970, the NIDC
issued Board Resolution No. 361 which restructured CCPI's loan and
increased it to DM12.2M, inclusive of interest.
9 It also alleged that the
NIDC board issued, on December 2, 1970, Board Resolution No. 373,
allowing the conversion of P7.07M out of a total P17.95M advances into
CCPI common stocks. Soon thereafter, on June 9, 1971, the NIDC approved Board Resolution No. 183, permitting a further conversion of
P14.2M of CCPI's advances into equity.
10 The petitioner also alleged that the NIDC
agreed to guarantee CCPI's P4.5M credit line with PNB, through Board
Resolution No. 40, dated February 10, 1972. And on February 10, 1972,
the NIDC issued Board Resolution No. 48, granting CCPI a guarantee loan
of $750,000.00.
11On September 5, 1997, the
Office of the Ombudsman issued the Resolution dismissing the Complaint
on the ground of prescription of the offense.
12 However, we reversed this ruling in G.R. No. 130140,
13where we held that the crime had not yet
prescribed and ordered the Ombudsman to conduct a preliminary
investigation.
On February 16, 2000, petitioner filed a Manifestation and Request for Issuance of
Subpoena Duces
Tecumu14 due to previous difficulties in obtaining
records from the PNB. It specifically sought from the PNB the
names of the NIDC directors who issued particular NIDC Board
Resolutions, the specific dates they were issued, and the amount of
money involved.
15 However, the Ombudsman failed to act
on this request.
On October 16, 2000, the Ombudsman
promulgated a resolution dismissing the complaint for the failure of the petitioner to furnish the names of the NIDC officials who should be
indicted. Instead, the respondents named in the complaint
appeared to be DBP officers and board members who should not be
implicated since the loan did not even pass through the DBP.
16On November 24, 2000, the petitioner filed a Motion for Reconsideration (With Motion for Leave to Admit Amended Complaint).
17 In the Amended Complaint,
18 the petitioner
identified respondents Tabasondra, Herbosa, Domingo and Malabanan as
officers and/or Board Members of PNB/NIDC, not the DBP; the mistake made in the original complaint was a mere typographical error. The officers and/or stockholders of CCPI - Shotwell, Roa, Zamora, Trivino,
Lopez, Reyes, Guballa, and del Rio - were also included as respondents.
However, the petitioner clarified that other individuals may still be
included as respondents. The petitioner repeated its allegation that the loan granted to CCPI was under-collateralized, while CCPI was
undercapitalized; these findings were reflected in a Memorandum
19 (dated January 17,
1968) submitted by NIDC Vice President Mario Consing to its Board of
Directors. It added that the Executive Summary and the documents
attached in the original complaint were made an integral part of the
Amended Complaint.
In the assailed Order
20 of February 27, 2001,the Ombudsman denied the Motion for Reconsideration for lack of
merit. He noted that there were no other documents attached to the Amended Complaint to prove that the respondents were liable for the acts complained of. He stated that the petitioner failed to
provide copies of the resolution that the PNB/NIDC officials allegedly
processed and approved. Thus, he considered the motion as a mere scrap
of paper.
On June 7, 2001, the petitioner filed this
Petition for Certiorari which assails the assailed Resolution and Order
on the following
grounds:
I
THE HONORABLE OMBUDSMAN GRAVELY ABUSED HIS DISCRETION IN ISSUING HIS SAID
RESOLUTION AND ORDER PROMULGATED ON NOVEMBER 13, 2000 (sic) AND MARCH
23, 2001 (sic) RESPECTIVELY. MORE PARTICULARLY, HE
GRAVELY ABUSED HIS DISCRETION IN HOLDING THAT "APART FROM THE FOREGOING
ENUMERATION, NO OTHER DOCUMENT WAS ATTACHED TO THE SAME TO PROVE THE
ALLEGATION THAT INDEED THE SAID RESPONDENTS WERE LIABILE FOR THE ACTS
COMPLAINED
OF."
II
THE ALLEGED INSUFFICIENCY OF EVIDENCE WAS DUE TO THE OMBUDSMAN'S GROSS
NEGLIGENCE IN THE PERFORMANCE OF HIS DUTIES, SPECIFICALLY HIS FAILURE TO ISSUE SUBPOENA DUCES TECUM AS REQUESTED BY PETITIONER.21
Ruling of the CourtWe
find the petition meritorious.
Ordinarily, the Court
does not interfere with the Ombudsman's determination of the existence
or non-existence of probable cause. The rule, however, does
not apply if there is grave abuse of discretion, or if the action is
done in a manner contrary to the dictates of the Constitution, law or
jurisprudence.
22 In these exceptional cases, the
Ombudsman's action becomes subject to judicial
review.
The Ombudsman, in dismissing a complaint -
whether for want of palpable merit or after the conduct of a preliminary investigation
23 - carries the duty of explaining the basis for his action; he must
determine that the complainant had failed to establish probable
cause.
The probable cause that a complainant has to
establish need not be based on clear and convincing evidence of guilt or evidence of guilt beyond reasonable doubt.
It simply implies
probability of guilt and requires more than a bare suspicion but less
than evidence that would justify a conviction. A
finding of probable cause need only rest on evidence showing that more
likely than not, a crime has been committed and was committed by the
suspects.
24Given this quantum of
evidence, we find that the Ombudsman gravely abused his discretion when
he immediately dismissed the Amended Complaint for being insufficient.
We find it particularly unsettling that the Ombudsman dismissively set
aside the petitioner's voluminous exhibits with only one paragraph, and
failed to discuss whether the questioned transactions bore the characteristics of a behest loan
25 and whether the respondents - those whose names were identified and those who were identified merely as directors and
officers of the entities involved - were probably guilty of violating
Section 3(e) and (g) of RA 3019. Lastly, the elements of the offenses
charged should have been examined and discussed, before a conclusion
regarding the existence or non-existence of probable cause is arrived
at.
In the present case, the Ombudsman dismissed the
Amended Complaint because he considered fatal the petitioner's failure
to provide copies of the resolutions duly approved by the officers and
directors of the PNB and the NIDC, showing that they were responsible
for the processing and the eventual approval of the questioned
loan. In its own words -
Apart from the aforementioned
enumeration no other document was attached to the same to prove the
allegation that indeed the said respondents were liable for the acts
complained of. There were no copies of the resolution duly approved by
said officials of the PNB/NIDC showing that they were responsible for
the processing and eventual approval of the questioned loan. To our
mind, the enumerations, standing alone, is (sic) not
sufficient to establish sufficient basis to proceed with the conduct of
preliminary investigation against said respondents. In other words, this motion is no more than a mere scrap of paper.26
In his
Comment,
27 the
Ombudsman added that instead of burdening the Office of the Ombudsman
with the issuance of the
subpoena duces tecum, the
petitioner should have asked the Presidential Commission on Good
Government (PCGG) to subpoena the required documents,
i.e., the relevant board resolutions, as it was
charged with the investigation of graft and corruption cases and it was
empowered to issue subpoenas under Section 3 of Executive Order (
EO) No. 1.
The
questioned transactions bear the
characteristics of behest
loans.We find that despite the
petitioner's failure to attach the relevant board resolutions in this
case, the records provide ample support to the petitioner's claim that
the officers and directors of the PNB and the NIDC had approved, in
favor of CCPI, a loan that qualifies with at least three criteria of
behest loans - (1) the borrower was undercapitalized; (2) the loan
accommodation was under-collateralized; and (3) the NIDC Board of
Directors approved the loan accommodation with extraordinary
haste.
There is prima facie proof
that CCPI
was undercapitalized when it applied for
and
was granted the loan
guarantee.Under MO 61, one of
the criteria for determining a behest loan is an undercapitalized
borrower corporation. Undercapitalization is the financial condition of a firm that does not have capital to carry on its business. Related to
this concept is that of thin capitalization - the financial condition of a firm that has a high ratio of liabilities to capital.
28The Guaranty Agreement
between CCPI and the NIDC, which was attached to the Amended Complaint,
clearly shows that (1) the amount of the loan guarantee was
P9,277,080.00 and (2) the amount of the paid-in capital at the time CCPI applied for the loan was P400,000.00.
29The Guaranty Agreement
sought to address the wide discrepancy between the amount of the loan
guarantee and CCPI's paid-in capital by adding the provision, included
among the "Borrower's Covenants," that requires CCPI to pay in cash
P1.7M as paid-in capital before the agreement is signed, and to pay cash installments of P600,000.00, P400,000.00 and P500,000.00 on the 9th,
12th, and 18th month after the signing of the agreement; these sums are
over and above the paid-in capital of P400,000.00.
30 Under the terms of the agreement,
the paid-in capital, even after the cash installments were made, would
still be less than half of the amount of the loan accommodation applied
for.
Nevertheless, CCPI failed to comply with the
lenient terms of the agreement. The NIDC Credit Investigation Report,
dated August 14, 1970, stated that CCPI refused to show its stock and
transfer book and books of account, and its paid-up capital as of
December 31, 1969, or nine months after the parties signed the
agreement, was only P2,111,000.
31 This means that the P600,000.00
installment due on the 9th' month after March 12, 1969 had not been
complied with.
The NIDC's unexplained response to
violations of these terms further proves the behest character of the
loan. Under the agreement, CCPI could have been considered as having
defaulted, and the obligations of CCPI would have been immediately due
and payable as early as 1970.
32 Instead of taking the appropriate legal action
to protect NIDC's interests, its directors issued Board Resolution No.
361 on November 25, 1970, which restructured CCPI's loan and increased
it to DM12.2M, inclusive of interest.
33 This further increased the already irregular
debt to equity ratio. There was no reason for NIDC to be confident that
CCPI would be able to pay its obligations; NIDC had to advance the
payment of the first amortization of DM600,000.00 to the supplier of the equipment on June 1, 1970.
34 It should also be noted that in 1970,the project, which should have started operations in April 1969, was
not even operational.
35 It was only on May 10, 1978 that the
NIDC directors issued Board Resolution No. 64 which approved the
management's recommendation to institute legal action against
CCPI.
36 And in 1981, when CCPI's liability to the NIDC had ballooned to P69,492,000.00, respondent Tabasondra, the
Acting Senior Vice President and General Manager of NIDC, belatedly
recommended the foreclosure of CCPI's insufficient collateral.
37There is
prima facie evidence that
the loan guarantee was
under-collateralized.Before the
parties signed the agreement, NIDC's Board of Directors had already been informed of the insufficiency of CCPI's collateral. The
Memorandum,
38
dated January 17, 1968, of NIDC Vice President Mario Consing, addressed
to the Board of Directors, valued the assets allegedly used as
collateral at P9.4M, the purported acquisition value of the assets. Even Consing characterized the valuation of the assets as "liberal,"
39 for what should have
been used in this case was the appraisal value of the assets, instead of the market value or the acquisition value. As the appraised
value is only 80% of the acquisition value, the assets were overstated
by at least 25%. Nevertheless, he found the overvalued collateral of
P9.4M to be insufficient and recommended that additional collateral of
real estate worth P5.2M be raised to fully secure NIDC's P9.3M exposure.The pertinent part of his Memorandum
reads:
Based on the more liberal
interpretation of NIDC's valuation policy (normally, the loan value is
based on the appraised value which is equivalent to 80% of the market
value or acquisition cost; in this case, however, the market value was
used as the base for computing loan value), the above properties would
have an approximate loan value of only P5.1M, covering roughly 55% of
the client's guarantee application. Additional collaterals with a market value of at least P5.3 million (in the form of real estate) should be
offered in order to fully secure NIDC's exposure of P9.3 million.40
However, the
records do not show that CCPI complied with the additional real estate
collateral required. The NIDC Credit Investigation Report, dated August
14, 1970, identified the collateral as a first mortgage on two parcels
of land with a total appraised value of P495,300.00, and a first
mortgage on all assets to be acquired.
41 The same report valued CCPI's fixed assets (including land) at P9,139,069.83.
42 Thus, even if we assume that all of CCPI's
fixed assets, as of the end of 1969, were used as collateral,
43 the amount of the
loan accommodation would still be higher than the total value of the
collateral. This clearly shows that the loan was
under-collateralized.
By issuing Board Resolution No.361 on November 25, 1970, which restructured CCPI's loan and increased
it to DM12.2M, the NIDC directors only increased the risk exposure of
PNB, and necessarily of the government, when it should have never even
approved a loan accommodation with insufficient
collateral.
The loan accommodation
was
approved with extraordinary
speed.The NIDC Board of
Directors approved the loan accommodation on January 17, 1968 (through
Board Resolution No. 26), the same date Vice President Mario Consing had submitted his report to the board, stating that CCPI had insufficient
collateral and capital. This clearly shows that the NIDC
officers prematurely approved the loan accommodation, contrary to
acceptable lending practices, as it was done before they were assured
that the company, whose loan they resolved to guarantee, could
reasonably be expected to meet its obligations. Matters were made worse
when CCPI failed to comply with the capital and collateral requirements
even after the parties signed their agreement; again, the board
prematurely approved the restructuring that increased CCPI's loan
accommodation and provided a longer period to comply with its
obligations.
The petitioner's
expertise in identifying
behest loans should be given due
respect.The petitioner's
allegation that the questioned transactions fall under "behest loans"
should not be lightly dismissed. It is worth mentioning that in our 2008 and 2009 decisions also entitled
Presidential Ad Hoc
Fact-Finding Committee on Behest Loans v. Desierto,
44 we found it proper to accord the petitioner's findings with healthy respect, as they were
precisely formed to determine the existence of behest loans. On account
of its special knowledge in the field of banking, it is in a position to determine whether standard banking practices were followed in the
approval of a loan, including the adequacy of the security for a given
loan or similar transaction.
The
petitioner's failure to name
the PNB/NIDC directors involved
should
not result in the outright dismissal of the
amended complaint.The Ombudsman
dismissed the Amended Complaint because the petitioner failed to provide copies of the board resolutions that would show that the respondents
were the officers and directors of PNB/NIDC who approved the questioned
transactions. We find this position
untenable.
Section 6 of RA 1300, the PNB charter,
provides that the business affairs and the property of the PNB shall be
managed and preserved by the Board of Directors. The Board of Directors
consists of the bank president, one vice-president, and five members who shall be elected. From this, we may reasonably infer that the grant of
the loan accommodation in CCPI's favor was accomplished through the
approval of the PNB/NIDC Board of Directors.
Ideally,the petitioner should have obtained copies of the board resolutions,
approving the questioned transactions, to determine who voted favorably
on these acts; this would enable petitioner to name the proper
respondents. However, the Ombudsman did not act on its motion for the
issuance of a subpoena duces tecum. Given this situation, the petitioner was able to identify some of the respondents by name and the others
were merely denominated as John Does,
45 in accordance with Section 7, Rule 110 of the
Rules of Court:
SEC. 7. Name of the accused. - The complaint or information must state the name and surname of the accused or any appellation or nickname by which he has been or
is known. If his name cannot be ascertained, he must be described under a fictitious name with a statement that his true name is
unknown.
If the true name of the accused is
thereafter disclosed by him or appears in some other manner to the
court, such true name shall be inserted in the complaint or information
and record.
Thus, even if the Ombudsman found that
the Amended Complaint against the named NIDC officers should be
dismissed, the complaint against the unnamed NIDC officers remains
valid. We further note that none of the named respondents denied being
PNB/NIDC board members during the relevant period, or approximately from 1967 to 1970. Moreover, respondents Domingo and Herbosa, who filed
their Comments,
46 failed to deny that they were NIDC officers
during this period or that they had not assented to the questioned
transactions; they merely stated that their names had not appeared in
any of the petitioner's exhibits pertaining to those dates. Nor should
we overlook the case against the CCPI directors who were all named in
the Amended Complaint.
In his Comment, the Ombudsman
justified his failure to issue a
subpoena duces tecum by stating that the PCGG should have issued the subpoena, as
it was empowered to do so under Section 3(e) of EO No. 1, dated February 28, 1986.
47 We
find this argument flimsy.
The PCGG's power to issue a subpoena under EO No. 1 is pursuant to its power to investigate cases
of graft and corruption. In this case the complaint was referred to the
Ombudsman, not the PCGG, for preliminary investigation. Under Section
15(1) of RA 6770, the Ombudsman is empowered to investigate and
prosecute offenses involving public officers and employees. In
Cojuangco, Jr. v. Presidential Commission on Good
Government,
48 we emphasized that the Ombudsman has the
primary jurisdiction over cases involving public officers and employees,even as we recognized the PCGG's concurrent jurisdiction.
Nothing in EO No. 1 would have prevented the Ombudsman from exercising
his powers under Section 15(8) of RA 6770 to "[ajdminister oaths, issue
subpoena x x x including the power to examine and have access to bank
accounts and records," especially since the complaint was filed before
him.
Even assuming that his position is correct, the
Ombudsman should have immediately denied the petitioner's motion to
issue a
subpoena duces tecum. He should
have informed the petitioner that he was not issuing the subpoena as it
was the PCGG which should issue the subpoena, and thus giving the
petitioner an opportunity to act on the matter. Instead, the Ombudsman
did not act on the motion, only to issue a resolution dismissing the
Amended Complaint for its failure to produce the documents that were the subject of the subpoena. By acting in this manner, he went
against his mandate, decreed under Section 13 of RA 6770, to "act
promptly on complaints filed in any form or manner against officers or
employees of the Government, or of any subdivision, agency or
instrumentality thereof, including government-owned or controlled
corporations, and enforce their administrative, civil and criminal
liability in every case where the evidence warrants in order to promote
efficient service by the Government to the
people."
The elements of violations under
Section 3, paragraphs (e) and (g) o
f RA 3019
were sufficiently alleged
in the amended
complaint.In the Amended
Complaint, the petitioner sought to charge the respondents with
violation of Section 3(e) and (g) of RA 3019, which
reads:
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
(e) Causing any undue injury to any party, including the Government, or giving any private party any
unwarranted benefits, advantage or preference in the discharge of his
official administrative or judicial functions through manifest
partiality, evident bad faith or gross inexcusable negligence. This
provision shall apply to officers and employees of offices or government corporations charged with the grant of licenses or permits or other
concessions.
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.
The elements of
the offense in Section 3(e) are: (1) that the accused are public
officers or private persons charged in conspiracy with the public
officers; (2) that said public officers committed the prohibited acts
during the performance of their official duties or
in relation to their public positions; (3) that they caused undue injury to any party, whether the Government or a private party; (4) that such
injury was caused by giving unwarranted benefits, advantage or
preference to such parties; and (5) that the public officers have acted
with manifest partiality, evident bad faith or gross inexcusable
negligence.
49On the other hand, the
elements of the offense in Section 3(g) are: (1) that the accused is a
public officer; (2) that he 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.
50It was properly alleged in the Amended Complaint that the respondent
officers and directors of PNB/NIDC, a government-owned and controlled
corporation, in conspiracy with the respondent directors and officers of CCPI, granted CCPI a loan accommodation that bore the characteristics
of behest loans. The government suffered injury when the loan, which
ballooned to over P205M, remained unpaid. The terms of the loan
accommodation were manifestly disadvantageous to the government that the NIDC directors' assent to this transaction could only be attended by
gross inexcusable negligence, if not evident bad faith or manifest
partiality. Moreover, these allegations were properly supported by the
records.
Thus, the Ombudsman should not have
immediately denied the motion for reconsideration, but should have
proceeded with the preliminary investigation, by requiring the
respondents to file their comments, and resolved the case based on the
evidence.
WHEREFORE, the petition
is
GRANTED. The Ombudsman's Resolution dated October
16, 2000 and Order dated February 27, 2001 in OMB-0-97-1138 are hereby
REVERSED and
SET ASIDE. The
Ombudsman is ordered (1) to conduct
with utmost
dispatch a preliminary investigation based on the
Amended Complaint; (2) to immediately issue the required subpoena for
the production of Board Resolution Nos. 26 and 361, dated January 17,
1968 and November 25, 1970, and other relevant documents; and (3) to
promptly evaluate the arguments of all the parties after having heard
them. No costs.
SO ORDERED Carpio Morales, Bersamin,
Villarama, Jr., and Sereno, JJ.,
concur.
Endnotes:
1 Rollo, pp. 34-39.
2 Id. at 1132. Respondents Domingo, Lopez, Guballa, del Rio, Roa, Trivino, Romeo Reyes, and Conrado Reyes have reportedly died.
3 Id. at 42-44.
4 Presidential Ad Hoc Fact-Finding Committee on Behest Loam v. Tabasondra, G.R. Nos. 133756 and 133757, July 4, 2008, 557 SCRA 31, 34.
5 Rollo, p. 675.
6 Id.at 217-225 and 18-20.
7 Id. at 395-399.
8 The petitioner's error in writing DBP instead of NIDC and PNB would later be corrected in its Amended Complaint.
9 Rollo, p. 98.
10 Id. at 182 and 198. The records show that these equity conversions, covered by Board Resolution Nos. 373 and 183, were between the NIDC and Coco Chemical Philippines, Inc, not CCPI. Coco Chemical Philippines, Inc. is in the business of manufacturing plasticizer, crude oil, copra meal pellets and refined oil. These transactions were later omitted in the Amended Complaint.
11 Id. at 198. The records show that the loan guarantees covered by Board Resolution Nos. 40 and 48 were between the NIDC and Coco Chemical Philippines, Inc, not CCPI. These transactions were later omitted in the Amended Complaint.
12 Id. at 373.
13 375 Phil. 697(1999).
14 Rollo, pp. 58-60.
15 Id. at 60. The petitioner listed the board resolutions and sought the PNB to provide it with copies thereof so as to identify the directors who approved them.
NIDC BR No. | Date | Amount |
No. 26 | 1-17-68 | DM7.4
million |
No. 361 | 11-25-70 | DM4.8
million |
No. 373 | 12-02-70 | P7.07
million |
No. 183 | 06-09-71 | P14.2
million |
No. 40 | 02-10-72 | P4.5 million |
No. 48 | 02-10-72 | $750,000 |
16 Id. at 34-39.
17 Id. at 45-46.
18 Id. at 47-49.
19 Id. at 123-144.
20 Id. at 42-44.
21 Id. at 23 and 26.
22 The Presidential Ad Hoc Fact-Finding Committee on Behest Loans v. Desierto, G.R. No. 136225, April 23, 2008, 552 SCRA 513, 524; The Presidential Ad Hoc Fact-Finding Committee on Behest Loans v. Desierto, G.R. No. 135703, April 15, 2009, 585 SCRA 18, 31.
23 Sections 2 and 4, Rule II of AO 7 of the Office of the Ombudsman, otherwise known as the Rules of Procedure of the Office of the Ombudsman.
24 Supra note 22, at 528.
25 See Presidential Ad Hoc Fact-Finding Committee on Behest Loans v. Desierto, G.R. No. 135687, July 24, 2007, 528 SCRA 9, 23-25. In this cited case, we considered the Ombudsman's failure to discuss the behest nature of the questioned loan transactions as a gross omission that would justify the review and modification of his determination that the complaint should be dismissed.
26 Rollo, p.43.
27 Id. at 674- 686.
28 Black's Law Dictionary, 8th edition.
29 Rollo, pp. 217 and 222.
30 Id. at 222.
31 Id. at 109-110.
32 Id. at 224. The default provision of the Agreement reads:
Events of Default
That any one or more of the following shall constitute an event of default, viz:
(i) Failure to pay any accrued interest on the guaranteed amount and/or the guaranty fee within a period of two (2) months.
(ii) Failure to pay any two (2) installments on the guaranteed principal.
(iii) Default in the observance of any provision under the section hereof entitled "Borrower's Covenants."
x x x x
When any of the events of default enumerated above has happened, occurred and/or is continuing, the NIDC may, at its exclusive option, by notice in writing to the BORROWER, declare the principal and/or any accrued interest on all outstanding promissory notes evidencing the loan or the amount subject of an NIDC guaranty to be immediately due and payable.
33 Id. at 98.
34 Id. at 107.
35 Id. at 200.
36 Id. at 159.
37 Id. at 159-161.
38 Id. at 123-144.
39 Id. at 125.
40 Ibid.
41 Id at 107.
42 Id. at 110. The term "fixed assets" is composed of land and improvements, machinery and equipment, transportation equipment and office equipment.
43 Id. The only remaining assets reported in its balance sheet were current assets and organizational expenses, and these cannot be considered as collateral.
44 Supra note 22, at 527; supra note 22, at 34.
45 Id. at 51.
46 Id. at 692-695 and 742-759.
47 Id. at 683.
48 G.R Nos. 92319-20, October 20, 1990, 190 SCRA 226, 241-242.
49 Supra note 22, at
50 Ibid.