JOSEPH VICTOR G.

EJERCITO, PETITIONER, VERSUS SANDIGANBAYAN

(SPECIAL DIVISION) AND PEOPLE OF THE PHILIPPINES, RESPONDENTS.
2006-11-30 | G.R. Nos. 157294-95
EN BANC
D E C I S I O N
CARPIO MORALES, J.:
The present petition for certiorari under Rule 65 assails the Sandiganbayan Resolutions dated February
7 and 12, 2003 denying petitioner Joseph Victor G. Ejercito's Motions to Quash Subpoenas Duces
Tecum/Ad Testificandum, and Resolution dated March 11, 2003 denying his Motion for Reconsideration
of the first two resolutions.
The three resolutions were issued in Criminal Case No. 26558, "People of the Philippines v. Joseph
Ejercito Estrada, et al.," for plunder, defined and penalized in R.A. 7080, "AN ACT DEFINING AND
PENALIZING THE CRIME OF PLUNDER."
In above-stated case of People v. Estrada, et al., the Special Prosecution Panel[1] filed on January 20,
2003 before the Sandiganbayan a Request for Issuance of Subpoena Duces Tecum for the issuance of
a subpoena directing the President of Export and Industry Bank (EIB, formerly Urban Bank) or his/her
authorized representative to produce the following documents during the hearings scheduled on January
22 and 27, 2003:
I. For Trust Account No. 858;
1. Account Opening Documents;
2. Trading Order No. 020385 dated January 29, 1999;
3. Confirmation Advice TA 858;
4. Original/Microfilm copies, including the dorsal side, of the following:a. Bank of Commerce MC #
0256254 in the amount of P2,000,000.00;
b. Urban bank Corp. MC # 34181 dated November 8, 1999 in the amount of P10,875,749.43;
c. Urban Bank MC # 34182 dated November 8, 1999 in the amount of P42,716,554.22;
d. Urban Bank Corp. MC # 37661 dated November 23, 1999 in the amount of P54,161,496.52;5. Trust
Agreement dated January 1999:Trustee: Joseph Victor C. Ejercito
Nominee: URBAN BANK-TRUST DEPARTMENT
Special Private Account No. (SPAN) 858; and6. Ledger of the SPAN # 858.II. For Savings Account No.
0116-17345-9
SPAN No. 858
1. Signature Cards; and
2. Statement of Account/LedgerIII. Urban Bank Manager's Check and their corresponding Urban Bank
Manager's Check Application Forms, as follows:
1. MC # 039975 dated January 18, 2000 in the amount of P70,000,000.00;
2. MC # 039976 dated January 18, 2000 in the amount of P2,000,000.00;
3. MC # 039977 dated January 18, 2000 in the amount of P2,000,000.00;
4. MC # 039978 dated January 18, 2000 in the amount of P1,000,000.00;The Special Prosecution Panel
also filed on January 20, 2003, a Request for Issuance of Subpoena Duces Tecum/Ad Testificandum
directed to the authorized representative of Equitable-PCI Bank to produce statements of account
pertaining to certain accounts in the name of "Jose Velarde" and to testify thereon.
The Sandiganbayan granted both requests by Resolution of January 21, 2003 and subpoenas were
accordingly issued.
The Special Prosecution Panel filed still another Request for Issuance of Subpoena Duces Tecum/Ad
Testificandum dated January 23, 2003 for the President of EIB or his/her authorized representative to
produce the same documents subject of the Subpoena Duces Tecum dated January 21, 2003 and to
testify thereon on the hearings scheduled on January 27 and 29, 2003 and subsequent dates until
completion of the testimony. The request was likewise granted by the Sandiganbayan. A Subpoena
Duces Tecum/Ad Testificandum was accordingly issued on January 24, 2003.
Petitioner, claiming to have learned from the media that the Special Prosecution Panel had requested for
the issuance of subpoenas for the examination of bank accounts belonging to him, attended the hearing
of the case on January 27, 2003 and filed before the Sandiganbayan a letter of even date expressing his
concerns as follows, quoted verbatim:
Your Honors:
It is with much respect that I write this court relative to the concern of subpoenaing the undersigned's
bank account which I have learned through the media.
I am sure the prosecution is aware of our banking secrecy laws everyone supposed to observe. But,
instead of prosecuting those who may have breached such laws, it seems it is even going to use
supposed evidence which I have reason to believe could only have been illegally obtained.
The prosecution was not content with a general request. It even lists and identifies specific documents
meaning someone else in the bank illegally released confidential information.
If this can be done to me, it can happen to anyone. Not that anything can still shock our family. Nor that I
have anything to hide. Your Honors.
But, I am not a lawyer and need time to consult one on a situation that affects every bank depositor in
the country and should interest the bank itself, the Bangko Sentral ng Pilipinas, and maybe the
Ombudsman himself, who may want to investigate, not exploit, the serious breach that can only harm the
economy, a consequence that may have been overlooked. There appears to have been deplorable
connivance.
x x x x
I hope and pray, Your Honors, that I will be given time to retain the services of a lawyer to help me
protect my rights and those of every banking depositor. But the one I have in mind is out of the country
right now.
May I, therefore, ask your Honors, that in the meantime, the issuance of the subpoena be held in
abeyance for at least ten (10) days to enable me to take appropriate legal steps in connection with the
prosecution's request for the issuance of subpoena concerning my accounts. (Emphasis supplied)From
the present petition, it is gathered that the "accounts" referred to by petitioner in his above-quoted letter
are Trust Account No. 858 and Savings Account No. 0116-17345-9.[2]
In open court, the Special Division of the Sandiganbayan, through Associate Justice Edilberto Sandoval,
advised petitioner that his remedy was to file a motion to quash, for which he was given up to 12:00 noon
the following day, January 28, 2003.
Petitioner, unassisted by counsel, thus filed on January 28, 2003 a Motion to Quash Subpoena Duces
Tecum/Ad Testificandum praying that the subpoenas previously issued to the President of the EIB dated
January 21 and January 24, 2003 be quashed.[3]
In his Motion to Quash, petitioner claimed that his bank accounts are covered by R.A. No. 1405 (The
Secrecy of Bank Deposits Law) and do not fall under any of the exceptions stated therein. He further
claimed that the specific identification of documents in the questioned subpoenas, including details on
dates and amounts, could only have been made possible by an earlier illegal disclosure thereof by the
EIB and the Philippine Deposit Insurance Corporation (PDIC) in its capacity as receiver of the then
Urban Bank.
The disclosure being illegal, petitioner concluded, the prosecution in the case may not be allowed to
make use of the information.
Before the Motion to Quash was resolved by the Sandiganbayan, the prosecution filed another Request
for the Issuance of Subpoena Duces Tecum/Ad Testificandum dated January 31, 2003, again to direct
the President of the EIB to produce, on the hearings scheduled on February 3 and 5, 2003, the same
documents subject of the January 21 and 24, 2003 subpoenas with the exception of the Bank of
Commerce MC #0256254 in the amount of P2,000,000 as Bank of Commerce MC #0256256 in the
amount of P200,000,000 was instead requested. Moreover, the request covered the following additional
documents:
IV. For Savings Account No. 1701-00646-1:1. Account Opening Forms;
2. Specimen Signature Card/s; and
3. Statements of Account.The prosecution also filed a Request for the Issuance of Subpoena Duces
Tecum/Ad Testificandum bearing the same date, January 31, 2003, directed to Aurora C. Baldoz, Vice
President-CR-II of the PDIC for her to produce the following documents on the scheduled hearings on
February 3 and 5, 2003:
1. Letter of authority dated November 23, 1999 re: SPAN [Special Private Account Number] 858;
2. Letter of authority dated January 29, 2000 re: SPAN 858;
3. Letter of authority dated April 24, 2000 re: SPAN 858;
4. Urban Bank check no. 052092 dated April 24, 2000 for the amount of P36, 572, 315.43;
5. Urban Bank check no. 052093 dated April 24, 2000 for the amount of P107,191,780.85; and
6. Signature Card Savings Account No. 0116-17345-9. (Underscoring supplied)The subpoenas prayed
for in both requests were issued by the Sandiganbayan on January 31, 2003.
On February 7, 2003, petitioner, this time assisted by counsel, filed an Urgent Motion to Quash
Subpoenae Duces Tecum/Ad Testificandum praying that the subpoena dated January 31, 2003 directed
to Aurora Baldoz be quashed for the same reasons which he cited in the Motion to Quash[4] he had
earlier filed.
On the same day, February 7, 2003, the Sandiganbayan issued a Resolution denying petitioner's Motion
to Quash Subpoenae Duces Tecum/Ad Testificandum dated January 28, 2003.
Subsequently or on February 12, 2003, the Sandiganbayan issued a Resolution denying petitioner's
Urgent Motion to Quash Subpoena Duces Tecum/Ad Testificandum dated February 7, 2003.
Petitioner's Motion for Reconsideration dated February 24, 2003 seeking a reconsideration of the
Resolutions of February 7 and 12, 2003 having been denied by Resolution of March 11, 2003, petitioner
filed the present petition.
Raised as issues are:
1. Whether petitioner's Trust Account No. 858 is covered by the term "deposit" as used in R.A. 1405;
2. Whether petitioner's Trust Account No. 858 and Savings Account No. 0116-17345-9 are excepted
from the protection of R.A. 1405; and
3. Whether the "extremely-detailed" information contained in the Special Prosecution Panel's requests
for subpoena was obtained through a prior illegal disclosure of petitioner's bank accounts, in violation of
the "fruit of the poisonous tree" doctrine.Respondent People posits that Trust Account No. 858[5] may be
inquired into, not merely because it falls under the exceptions to the coverage of R.A. 1405, but because
it is not even contemplated therein. For, to respondent People, the law applies only to "deposits" which
strictly means the money delivered to the bank by which a creditor-debtor relationship is created
between the depositor and the bank.
The contention that trust accounts are not covered by the term "deposits," as used in R.A. 1405, by the
mere fact that they do not entail a creditor-debtor relationship between the trustor and the bank, does not
lie. An examination of the law shows that the term "deposits" used therein is to be understood broadly
and not limited only to accounts which give rise to a creditor-debtor relationship between the depositor
and the bank.
The policy behind the law is laid down in Section 1:
SECTION 1. It is hereby declared to be the policy of the Government to give encouragement to the
people to deposit their money in banking institutions and to discourage private hoarding so that the same
may be properly utilized by banks in authorized loans to assist in the economic development of the
country. (Underscoring supplied)If the money deposited under an account may be used by banks for
authorized loans to third persons, then such account, regardless of whether it creates a creditor-debtor
relationship between the depositor and the bank, falls under the category of accounts which the law
precisely seeks to protect for the purpose of boosting the economic development of the country.
Trust Account No. 858 is, without doubt, one such account. The Trust Agreement between petitioner and
Urban Bank provides that the trust account covers "deposit, placement or investment of funds" by Urban
Bank for and in behalf of petitioner.[6] The money deposited under Trust Account No. 858, was,
therefore, intended not merely to remain with the bank but to be invested by it elsewhere. To hold that
this type of account is not protected by R.A. 1405 would encourage private hoarding of funds that could
otherwise be invested by banks in other ventures, contrary to the policy behind the law.
Section 2 of the same law in fact even more clearly shows that the term "deposits" was intended to be
understood broadly:
SECTION 2. All deposits of whatever nature with banks or banking institutions in the Philippines
including investments in bonds issued by the Government of the Philippines, its political subdivisions and
its instrumentalities, are hereby considered as of an absolutely confidential nature and may not be
examined, inquired or looked into by any person, government official, bureau or office, except upon
written permission of the depositor, or in cases of impeachment, or upon order of a competent court in
cases of bribery or dereliction of duty of public officials, or in cases where the money deposited or
invested is the subject matter of the litigation. (Emphasis and underscoring supplied)The phrase "of
whatever nature" proscribes any restrictive interpretation of "deposits." Moreover, it is clear from the
immediately quoted provision that, generally, the law applies not only to money which is deposited but
also to those which are invested. This further shows that the law was not intended to apply only to
"deposits" in the strict sense of the word. Otherwise, there would have been no need to add the phrase
"or invested."
Clearly, therefore, R.A. 1405 is broad enough to cover Trust Account No. 858.
The protection afforded by the law is, however, not absolute, there being recognized exceptions thereto,
as above-quoted Section 2 provides. In the present case, two exceptions apply, to wit: (1) the
examination of bank accounts is upon order of a competent court in cases of bribery or dereliction of
duty of public officials, and (2) the money deposited or invested is the subject matter of the litigation.
Petitioner contends that since plunder is neither bribery nor dereliction of duty, his accounts are not
excepted from the protection of R.A. 1405. Philippine National Bank v. Gancayco[7] holds otherwise:
Cases of unexplained wealth are similar to cases of bribery or dereliction of duty and no reason is
seen why these two classes of cases cannot be excepted from the rule making bank deposits
confidential. The policy as to one cannot be different from the policy as to the other. This policy
expresses the notion that a public office is a public trust and any person who enters upon its
discharge does so with the full knowledge that his life, so far as relevant to his duty, is open to public
scrutiny.
Undoubtedly, cases for plunder involve unexplained wealth. Section 2 of R.A. No. 7080 states so.
SECTION 2. Definition of the Crime of Plunder; Penalties. - Any public officer who, by himself or in
connivance with members of his family, relatives by affinity or consanguinity, business associates,
subordinates or other persons, amasses, accumulates or acquires ill-gotten wealth through a
combination or series of overt or criminal acts as described in Section 1(d) hereof, in the aggregate
amount or total value of at least Seventy-five million pesos (P75,000,000.00), shall be guilty of the crime
of plunder and shall be punished by life imprisonment with perpetual absolute disqualification from
holding any public office. Any person who participated with said public officer in the commission of
plunder shall likewise be punished. In the imposition of penalties, the degree of participation and the
attendance of mitigating and extenuating circumstances shall be considered by the court. The court shall
declare any and all ill-gotten wealth and their interests and other incomes and assets including the
properties and shares of stock derived from the deposit or investment thereof forfeited in favor of the
State. (Emphasis and underscoring supplied)An examination of the "overt or criminal acts as described
in Section 1(d)" of R.A. No. 7080 would make the similarity between plunder and bribery even more
pronounced since bribery is essentially included among these criminal acts. Thus Section 1(d) states:
d) "Ill-gotten wealth" means any asset, property, business enterprise or material possession of any
person within the purview of Section Two (2) hereof, acquired by him directly or indirectly through
dummies, nominees, agents, subordinates and or business associates by any combination or series of
the following means or similar schemes.
1) Through misappropriation, conversion, misuse, or malversation of public funds or raids on the public
treasury;
2) By receiving, directly or indirectly, any commission, gift, share, percentage, kickbacks or any
other form of pecuniary benefit from any person and/or entity in connection with any government
contract or project or by reason of the office or position of the public officer concerned;
3) By the illegal or fraudulent conveyance or disposition of assets belonging to the National Government
or any of its subdivisions, agencies or instrumentalities or government-owned or -controlled corporations
and their subsidiaries;
4) By obtaining, receiving or accepting directly or indirectly any shares of stock, equity or any other form
of interest or participation including promise of future employment in any business enterprise or
undertaking;
5) By establishing agricultural, industrial or commercial monopolies or other combinations and/or
implementation of decrees and orders intended to benefit particular persons or special interests; or
6) By taking undue advantage of official position, authority, relationship, connection or influence to
unjustly enrich himself or themselves at the expense and to the damage and prejudice of the Filipino
people and the Republic of the Philippines. (Emphasis supplied)Indeed, all the above-enumerated overt
acts are similar to bribery such that, in each case, it may be said that "no reason is seen why these two
classes of cases cannot be excepted from the rule making bank deposits confidential."[8]
The crime of bribery and the overt acts constitutive of plunder are crimes committed by public officers,
and in either case the noble idea that "a public office is a public trust and any person who enters upon its
discharge does so with the full knowledge that his life, so far as relevant to his duty, is open to public
scrutiny" applies with equal force.
Plunder being thus analogous to bribery, the exception to R.A. 1405 applicable in cases of bribery must
also apply to cases of plunder.
Respecting petitioner's claim that the money in his bank accounts is not the "subject matter of the
litigation," the meaning of the phrase "subject matter of the litigation" as used in R.A. 1405 is explained in
Union Bank of the Philippines v. Court of Appeals,[9] thus:
Petitioner contends that the Court of Appeals confuses the "cause of action" with the "subject of the
action". In Yusingco v. Ong Hing Lian, petitioner points out, this Court distinguished the two concepts.
x x x "The cause of action is the legal wrong threatened or committed, while the object of the action is to
prevent or redress the wrong by obtaining some legal relief; but the subject of the action is neither of
these since it is not the wrong or the relief demanded, the subject of the action is the matter or thing with
respect to which the controversy has arisen, concerning which the wrong has been done, and this
ordinarily is the property or the contract and its subject matter, or the thing in dispute."
The argument is well-taken. We note with approval the difference between the 'subject of the action' from
the 'cause of action.' We also find petitioner's definition of the phrase 'subject matter of the action' is
consistent with the term 'subject matter of the litigation', as the latter is used in the Bank Deposits
Secrecy Act.
In Mellon Bank, N.A. v. Magsino, where the petitioner bank inadvertently caused the transfer of the
amount of US$1,000,000.00 instead of only US$1,000.00, the Court sanctioned the examination of
the bank accounts where part of the money was subsequently caused to be deposited:
'x x x Section 2 of [Republic Act No. 1405] allows the disclosure of bank deposits in cases where the
money deposited is the subject matter of the litigation. Inasmuch as Civil Case No. 26899 is aimed at
recovering the amount converted by the Javiers for their own benefit, necessarily, an inquiry into
the whereabouts of the illegally acquired amount extends to whatever is concealed by being held
or recorded in the name of persons other than the one responsible for the illegal acquisition."
Clearly, Mellon Bank involved a case where the money deposited was the subject matter of the litigation
since the money deposited was the very thing in dispute. x x x" (Emphasis and underscoring supplied)
The plunder case now pending with the Sandiganbayan necessarily involves an inquiry into the
whereabouts of the amount purportedly acquired illegally by former President Joseph Estrada.
In light then of this Court's pronouncement in Union Bank, the subject matter of the litigation cannot be
limited to bank accounts under the name of President Estrada alone, but must include those accounts to
which the money purportedly acquired illegally or a portion thereof was alleged to have been transferred.
Trust Account No. 858 and Savings Account No. 0116-17345-9 in the name of petitioner fall under this
description and must thus be part of the subject matter of the litigation.
In a further attempt to show that the subpoenas issued by the Sandiganbayan are invalid and may not be
enforced, petitioner contends, as earlier stated, that the information found therein, given their "extremely
detailed" character, could only have been obtained by the Special Prosecution Panel through an illegal
disclosure by the bank officials concerned. Petitioner thus claims that, following the "fruit of the
poisonous tree" doctrine, the subpoenas must be quashed.
Petitioner further contends that even if, as claimed by respondent People, the "extremely-detailed"
information was obtained by the Ombudsman from the bank officials concerned during a previous
investigation of the charges against President Estrada, such inquiry into his bank accounts would itself
be illegal.
Petitioner relies on Marquez v. Desierto[10] where the Court held:
We rule that before an in camera inspection may be allowed there must be a pending case before a
court of competent jurisdiction. Further, the account must be clearly identified, the inspection limited to
the subject matter of the pending case before the court of competent jurisdiction. The bank personnel
and the account holder must be notified to be present during the inspection, and such inspection may
cover only the account identified in the pending case. (Underscoring supplied)
As no plunder case against then President Estrada had yet been filed before a court of competent
jurisdiction at the time the Ombudsman conducted an investigation, petitioner concludes that the
information about his bank accounts were acquired illegally, hence, it may not be lawfully used to
facilitate a subsequent inquiry into the same bank accounts.
Petitioner's attempt to make the exclusionary rule applicable to the instant case fails. R.A. 1405, it bears
noting, nowhere provides that an unlawful examination of bank accounts shall render the evidence
obtained therefrom inadmissible in evidence. Section 5 of R.A. 1405 only states that "[a]ny violation of
this law will subject the offender upon conviction, to an imprisonment of not more than five years or a fine
of not more than twenty thousand pesos or both, in the discretion of the court."
The case of U.S. v. Frazin,[11] involving the Right to Financial Privacy Act of 1978 (RFPA) of the United
States, is instructive.
Because the statute, when properly construed, excludes a suppression remedy, it would not be
appropriate for us to provide one in the exercise of our supervisory powers over the administration of
justice. Where Congress has both established a right and provided exclusive remedies for its violation,
we would "encroach upon the prerogatives" of Congress were we to authorize a remedy not provided for
by statute. United States v. Chanen, 549 F.2d 1306, 1313 (9th Cir.), cert. denied, 434 U.S. 825, 98 S.Ct.
72, 54 L.Ed.2d 83 (1977).
The same principle was reiterated in U.S. v. Thompson:[12]
x x x When Congress specifically designates a remedy for one of its acts, courts generally presume that
it engaged in the necessary balancing of interests in determining what the appropriate penalty should be.
See Michaelian, 803 F.2d at 1049 (citing cases); Frazin, 780 F.2d at 1466. Absent a specific reference to
an exclusionary rule, it is not appropriate for the courts to read such a provision into the act.
Even assuming arguendo, however, that the exclusionary rule applies in principle to cases involving R.A.
1405, the Court finds no reason to apply the same in this particular case.
Clearly, the "fruit of the poisonous tree" doctrine[13] presupposes a violation of law. If there was no
violation of R.A. 1405 in the instant case, then there would be no "poisonous tree" to begin with, and,
thus, no reason to apply the doctrine.
How the Ombudsman conducted his inquiry into the bank accounts of petitioner is recounted by
respondent People of the Philippines, viz:
x x x [A]s early as February 8, 2001, long before the issuance of the Marquez ruling, the Office of the
Ombudsman, acting under the powers granted to it by the Constitution and R.A. No. 6770, and acting on
information obtained from various sources, including impeachment (of then Pres. Joseph Estrada)
related reports, articles and investigative journals, issued a Subpoena Duces Tecum addressed to Urban
Bank. (Attachment "1-b") It should be noted that the description of the documents sought to be produced
at that time included that of numbered accounts 727, 737, 747, 757, 777 and 858 and included such
names as Jose Velarde, Joseph E. Estrada, Laarni Enriquez, Guia Gomez, Joy Melendrez, Peachy
Osorio, Rowena Lopez, Kevin or Kelvin Garcia. The subpoena did not single out account 858.
x x x x
Thus, on February 13, 2001, PDIC, as receiver of Urban Bank, issued a certification as to the availability
of bank documents relating to A/C 858 and T/A 858 and the non-availability of bank records as to the
other accounts named in the subpoena. (Attachments "2", "2-1" and "2-b)
Based on the certification issued by PDIC, the Office of the Ombudsman on February 16, 2001 again
issued a Subpoena Duces Tecum directed to Ms. Corazon dela Paz, as Interim Receiver, directing the
production of documents pertinent to account A/C 858 and T/C 858. (Attachment "3")
In compliance with the said subpoena dated February 16, 2001, Ms. Dela Paz, as interim receiver,
furnished the Office of the Ombudsman certified copies of documents under cover latter dated February
21, 2001:
1. Transaction registers dated 7-02-99, 8-16-99, 9-17-99, 10-18-99, 11-22-99, 1-07-00, 04-03-00 and
04-24-00;
2. Report of Unregularized TAFs & TDs for UR COIN A & B Placements of Various Branches as of
February 29, 2000 and as of December 16, 1999; and
3. Trading Orders Nos. A No. 78102 and A No. 078125.
Trading Order A No. 07125 is filed in two copies - a white copy which showed "set up" information; and a
yellow copy which showed "reversal" information. Both copies have been reproduced and are enclosed
with this letter.
We are continuing our search for other records and documents pertinent to your request and we will
forward to you on Friday, 23 February 2001, such additional records and documents as we might find
until then. (Attachment "4")
The Office of the Ombudsman then requested for the manger's checks, detailed in the Subpoena Duces
Tecum dated March 7, 2001. (Attachment "5")
PDIC again complied with the said Subpoena Duces Tecum dated March 7, 2001 and provided copies of
the manager's checks thus requested under cover letter dated March 16, 2001. (Attachment "6")[14]
(Emphasis in the original)
The Sandiganbayan credited the foregoing account of respondent People.[15] The Court finds no reason
to disturb this finding of fact by the Sandiganbayan.
The Marquez ruling notwithstanding, the above-described examination by the Ombudsman of petitioner's
bank accounts, conducted before a case was filed with a court of competent jurisdiction, was lawful.
For the Ombudsman issued the subpoenas bearing on the bank accounts of petitioner about four
months before Marquez was promulgated on June 27, 2001.
While judicial interpretations of statutes, such as that made in Marquez with respect to R.A. No. 6770 or
the Ombudsman Act of 1989, are deemed part of the statute as of the date it was originally passed, the
rule is not absolute.
Columbia Pictures, Inc. v. Court of Appeals[16] teaches:
It is consequently clear that a judicial interpretation becomes a part of the law as of the date that law was
originally passed, subject only to the qualification that when a doctrine of this Court is overruled
and a different view is adopted, and more so when there is a reversal thereof, the new doctrine
should be applied prospectively and should not apply to parties who relied on the old doctrine and
acted in good faith. (Emphasis and underscoring supplied)
When this Court construed the Ombudsman Act of 1989, in light of the Secrecy of Bank Deposits Law in
Marquez, that "before an in camera inspection may be allowed there must be a pending case before a
court of competent jurisdiction", it was, in fact, reversing an earlier doctrine found in Banco Filipino
Savings and Mortgage Bank v. Purisima[17].
Banco Filipino involved subpoenas duces tecum issued by the Office of the Ombudsman, then known as
the Tanodbayan,[18] in the course of its preliminary investigation of a charge of violation of the
Anti-Graft and Corrupt Practices Act.
While the main issue in Banco Filipino was whether R.A. 1405 precluded the Tanodbayan's issuance of
subpoena duces tecum of bank records in the name of persons other than the one who was charged,
this Court, citing P.D. 1630,[19] Section 10, the relevant part of which states:
(d) He may issue a subpoena to compel any person to appear, give sworn testimony, or produce
documentary or other evidence the Tanodbayan deems relevant to a matter under his inquiry,held that
"The power of the Tanodbayan to issue subpoenae ad testificandum and subpoenae duces
tecum at the time in question is not disputed, and at any rate does not admit of doubt."[20]
As the subpoenas subject of Banco Filipino were issued during a preliminary investigation, in effect this
Court upheld the power of the Tandobayan under P.D. 1630 to issue subpoenas duces tecum for bank
documents prior to the filing of a case before a court of competent jurisdiction.
Marquez, on the other hand, practically reversed this ruling in Banco Filipino despite the fact that the
subpoena power of the Ombudsman under R.A. 6770 was essentially the same as that under P.D. 1630.
Thus Section 15 of R.A. 6770 empowers the Office of the Ombudsman to
(8) Administer oaths, issue subpoena and subpoena duces tecum, and take testimony in any
investigation or inquiry, including the power to examine and have access to bank accounts and records;
A comparison of this provision with its counterpart in Sec. 10(d) of P.D. 1630 clearly shows that it is only
more explicit in stating that the power of the Ombudsman includes the power to examine and have
access to bank accounts and records which power was recognized with respect to the Tanodbayan
through Banco Filipino.
The Marquez ruling that there must be a pending case in order for the Ombudsman to validly inspect
bank records in camera thus reversed a prevailing doctrine.[21] Hence, it may not be retroactively
applied.
The Ombudsman's inquiry into the subject bank accounts prior to the filing of any case before a court of
competent jurisdiction was therefore valid at the time it was conducted.
Likewise, the Marquez ruling that "the account holder must be notified to be present during the
inspection" may not be applied retroactively to the inquiry of the Ombudsman subject of this case. This
ruling is not a judicial interpretation either of R.A. 6770 or R.A. 1405, but a "judge-made" law which, as
People v. Luvendino[22] instructs, can only be given prospective application:
x x x The doctrine that an uncounselled waiver of the right to counsel is not to be given legal
effect was initially a judge-made one and was first announced on 26 April 1983 in Morales v.
Enrile and reiterated on 20 March 1985 in People v. Galit. x x x
While the Morales-Galit doctrine eventually became part of Section 12(1) of the 1987 Constitution, that
doctrine affords no comfort to appellant Luvendino for the requirements and restrictions outlined in
Morales and Galit have no retroactive effect and do not reach waivers made prior to 26 April 1983
the date of promulgation of Morales. (Emphasis supplied)
In fine, the subpoenas issued by the Ombudsman in this case were legal, hence, invocation of the "fruit
of the poisonous tree" doctrine is misplaced.
At all events, even if the challenged subpoenas are quashed, the Ombudsman is not barred from
requiring the production of the same documents based solely on information obtained by it from sources
independent of its previous inquiry.
In particular, the Ombudsman, even before its inquiry, had already possessed information giving him
grounds to believe that (1) there are bank accounts bearing the number "858," (2) that such accounts are
in the custody of Urban Bank, and (3) that the same are linked with the bank accounts of former
President Joseph Estrada who was then under investigation for plunder.
Only with such prior independent information could it have been possible for the Ombudsman to issue
the February 8, 2001 subpoena duces tecum addressed to the President and/or Chief Executive Officer
of Urban Bank, which described the documents subject thereof as follows:
(a) bank records and all documents relative thereto pertaining to all bank accounts (Savings, Current,
Time Deposit, Trust, Foreign Currency Deposits, etc...) under the account names of Jose Velarde,
Joseph E. Estrada, Laarni Enriquez, Guia Gomez, Joy Melendrez, Peach Osorio, Rowena Lopez, Kevin
or Kelvin Garcia, 727, 737, 747, 757, 777 and 858. (Emphasis and underscoring supplied)
The information on the existence of Bank Accounts bearing number "858" was, according to respondent
People of the Philippines, obtained from various sources including the proceedings during the
impeachment of President Estrada, related reports, articles and investigative journals.[23] In the absence
of proof to the contrary, this explanation proffered by respondent must be upheld. To presume that the
information was obtained in violation of R.A. 1405 would infringe the presumption of regularity in the
performance of official functions.
Thus, with the filing of the plunder case against former President Estrada before the Sandiganbayan, the
Ombudsman, using the above independent information, may now proceed to conduct the same
investigation it earlier conducted, through which it can eventually obtain the same information previously
disclosed to it by the PDIC, for it is an inescapable fact that the bank records of petitioner are no longer
protected by R.A. 1405 for the reasons already explained above.
Since conducting such an inquiry would, however, only result in the disclosure of the same documents to
the Ombudsman, this Court, in avoidance of what would be a time-wasteful and circuitous way of
administering justice,[24] upholds the challenged subpoenas.
Respecting petitioner's claim that the Sandiganbayan violated his right to due process as he was neither
notified of the requests for the issuance of the subpoenas nor of the grant thereof, suffice it to state that
the defects were cured when petitioner ventilated his arguments against the issuance thereof through his
earlier quoted letter addressed to the Sandiganbayan and when he filed his motions to quash before the
Sandiganbayan.
IN SUM, the Court finds that the Sandiganbayan did not commit grave abuse of discretion in issuing the
challenged subpoenas for documents pertaining to petitioner's Trust Account No. 858 and Savings
Account No. 0116-17345-9 for the following reasons:
1. These accounts are no longer protected by the Secrecy of Bank Deposits Law, there being two
exceptions to the said law applicable in this case, namely: (1) the examination of bank accounts is upon
order of a competent court in cases of bribery or dereliction of duty of public officials, and (2) the money
deposited or invested is the subject matter of the litigation. Exception (1) applies since the plunder case
pending against former President Estrada is analogous to bribery or dereliction of duty, while exception
(2) applies because the money deposited in petitioner's bank accounts is said to form part of the subject
matter of the same plunder case.
2. The "fruit of the poisonous tree" principle, which states that once the primary source (the "tree") is
shown to have been unlawfully obtained, any secondary or derivative evidence (the "fruit") derived from
it is also inadmissible, does not apply in this case. In the first place, R.A. 1405 does not provide for the
application of this rule. Moreover, there is no basis for applying the same in this case since the primary
source for the detailed information regarding petitioner's bank accounts - the investigation previously
conducted by the Ombudsman - was lawful.
3. At all events, even if the subpoenas issued by the Sandiganbayan were quashed, the Ombudsman
may conduct on its own the same inquiry into the subject bank accounts that it earlier conducted last
February-March 2001, there being a plunder case already pending against former President Estrada. To
quash the challenged subpoenas would, therefore, be pointless since the Ombudsman may obtain the
same documents by another route. Upholding the subpoenas avoids an unnecessary delay in the
administration of justice.
WHEREFORE, the petition is DISMISSED. The Sandiganbayan Resolutions dated February 7 and 12,
2003 and March 11, 2003 are upheld.
The Sandiganbayan is hereby directed, consistent with this Court's ruling in Marquez v. Desierto, to
notify petitioner as to the date the subject bank documents shall be presented in court by the persons
subpoenaed.
SO ORDERED.
CONCHITA CARPIO MORALES
Associate Justice
WE CONCUR:
ARTEMIO V. PANGANIBAN
Chief Justice
REYNATO S. PUNO LEONARDO A. QUISUMBING
Associate Justice Associate Justice
CONSUELO YNARES-SANTIAGO ANGELINA SANDOVAL-GUTIERREZ
Associate Justice Associate Justice
ANTONIO T. CARPIO MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice Associate Justice
RENATO C. CORONA ROMEO J. CALLEJO, SR.
Associate Justice Associate Justice
ADOLFO S. AZCUNA DANTE O. TINGA
Associate Justice Associate Justice
MINITA V. CHICO-NAZARIO CANCIO C. GARCIA
Associate Justice Associate Justice
PRESBITERO J. VELASCO, JR.
Associate Justice
CERTIFICATION
Pursuant to Article VIII, Section 13 of the Constitution, it is hereby certified that the conclusions in the
above Decision were reached in consultation before the case was assigned to the writer of the opinion of
the Court.
ARTEMIO V. PANGANIBAN
Chief Justice
FOOTNOTES
[1] Composed of the Ombudsman, the Special Prosecutor, Deputy Special Prosecutor, Assistant
Ombudsman, Special Prosecution Officer III, and Special Prosecution Officer II, (Rollo, pp. 492-493).
[2] "Petitioner is the owner of Trust Account No. 858 which was originally opened at Urban Bank but
which is now maintained at Export and Industry Bank, which is the purchaser and owner now of the
former Urban Bank and Urbancorp Investment, Inc. Petitioner is also the owner of Savings Account No.
0116-17345-9 which was originally opened at Urban Bank but which is now maintained at Export and
Industry Bank, which is the purchaser and owner of the former Urban Bank and Urbancorp Investment,
Inc. x x x" (Petition, pp. 3-4, rollo, pp. 10-11)
[3] The first paragraph of the motion identifies the subpoenas sought to be quashed as those allegedly
issued on January 24, 2003 directed to the representative/s of the Urban Bank (now EIB) and to Ms.
Aurora C. Baldoz, Vice-President-CR-II of the Philippine Deposit Insurance Corporation. However, the
second motion to quash later filed by petitioner with the assistance of counsel stated that the subpoenas
subject of the previous motion to quash were those issued on January 21, 2003, addressed to the
President of the EIB and to the President of Equitable-PCI Bank, or their representatives.
Despite the apparent conflict, it may be inferred that the first motion to quash covered the subpoenas
directed to the President of the EIB dated January 21, 2003 and January 24, 2003, the January 24
subpoena being a mere reiteration of the January 21 subpoena.
As there is nothing in the records before this Court which show that a subpoena dated January 24, 2003
was ever issued to Ms. Baldoz, the Court will consider petitioner's first Motion to Quash as concerned
only with the subpoenas directed to the President of the EIB.
The statement in the second motion to quash that the first motion covered the January 21 subpoenas
issued to the President of EIB and to the President of Equitable-PCI Bank may only be an error arising
from the fact that a subpoena to each of these officers were granted by the Sandiganbayan through the
same Resolution dated January 21, 2003. The petitioner could not have been referring to the subpoena
directed to the President of Equitable-PCI Bank since the subject thereof were the Jose Velarde
accounts which he has never claimed to be his, even in the present petition.
[4] Rollo, p. 171
[5] Respondent People of the Philippines argue on the premise that Trust Account No. 858 covers
Savings Account No. 0116-17345-9.
[6] Rollo, p. 708.
[7] 122 Phil. 503, 508 (1965).
[8] Philippine National Bank v. Gancayco, supra at note 7.
[9] 378 Phil. 1177, 1182-1183 (1999).
[10] 412 Phil. 387, 397 (2001).
[11] 780 F.2d 1461 (1986).
[12] 936 F.2d 1249 (1991).
[13] "According to this rule, once the primary source (the "tree") is shown to have been unlawfully
obtained, any secondary or derivative evidence (the "fruit") derived from it is also inadmissible." [People
v. Alicando, 321 Phil. 656, 690 (1995)].
[14] Rollo, pp. 439- 442.
[15] "As clarified by the prosecution, the documents listed in the request were obtained in February 2001,
pursuant to the power conferred on the Ombudsman under Section 15(8) of R.A. 6770, long before the
Supreme Court promulgated the Marquez v. Desierto case." (Sandiganbayan Resolution dated February
7, 2003, rollo, p. 72)
[16] G.R. No. 110318, August 28, 1996, 261 SCRA 144, 168.
[17] G.R. No. L-56429. May 28, 1988, 161 SCRA 576.
[18] Section 2 of P.D. 1630 entitled "FURTHER REVISING PRESIDENTIAL DECREE NO. 1487, AS
REVISED BY PRESIDENTIAL DECREE NO. 1607, CREATING THE OFFICE OF THE TANODBAYAN"
states: "An independent Office of the Ombudsman, to be called the Office of the Tanodbayan, is hereby
created. The Chief of said Office of the Tanodbayan shall be called the Tanodbayan who shall have two
(2) deputies for Luzon, one for the Visayas and one for Mindanao." (Underscoring supplied)
[19] Vide note 18.
[20] Supra at 582.
[21] Vide Rafael A. Morales, The Philippine General Banking Law (Annotated), 2nd ed. (2004), page 145:
"It used to be believed too that the Secrecy of Bank Deposits Law did not apply to the Ombudsman, on
account of his authority, under Section 15(8) of the Ombudsman Act of 1989 (Republic Act No. 6770), to
'examine and have access to bank accounts and records.' However, the Supreme Court in Marquez vs.
Hon. Aniano A. Desierto, et al., G.R. No. 135882, June 27, 2001, restricted the Ombudsman's power x x
x." (Underscoring supplied)
[22] G.R. No. 69971, July 3, 1992, 211 SCRA 36, 49-50, reiterated in Filoteo v. Sandiganbayan, 331 Phil.
531, 573 (1996).
[23] Rollo, p. 439.
[24] Amunategue Vda. de Gentugao v. Court of Appeals (G.R. No. L-30340. June 30, 1976, 71 SCRA
565, 574); vide Ortigas and Co. Ltd. Partnership v. Velasco (G.R. No. 109645, July 25, 1994, 234 SCRA
455, 501).