PEOPLE v.

MORALES Coseteng delivered a privilege speech in the Senate denouncing these

May 30, 2011 | Brion, J. | anomalies. The Senate Blue Ribbon Committee conducted an investigation on the
Digester: De Leon, Fenina Philippine Centennial project. President Joseph Estrada created the ad
hoc committee also for the purpose of investigating these alleged anomalies.
SUMMARY: President Aquino created a Committee, later renamed to NCC by  The investigation that followed resulted in the filing in 2001 of an Information by
President Ramos, to commemorate the 100th anniversary of the declaration of the Ombudsmans Fact-Finding and Investigation Bureau against respondent Luis J.
Philippine Independence. The late VP Salvador Laurel was appointed as NCC Morales (Morales), the acting president of Expocorp at the time relevant to the case.
Chairman. NCC and BCDA organized Expocorp whose primary purpose was to That on or about September 6, 1997 or sometime prior or subsequent thereto in Pasig City,
Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, a
operate, administer, manage and develop the Philippine Centennial International public officer, being then the Pres. of Expo Corporation, Pasig City, a government corporation,
Exposition 1998 (Expo 98). The project was marred by numerous allegations of and as such was issued one (1) Mercede[s] Benz, Model 1997-C230, bearing Serial No.
anomalies. Investigations resulted in the filing in 2001 of an Information by the WDB202023-1F-602122, and Engine No. 111974-12-027093 for his official use, and while in the
Ombudsman against Morales, the acting president of Expocorp. Morales argued that SB performance of his official functions, acting thru evident bad faith and manifest partiality, did then
and there willfully, unlawfully, and criminally give unwarranted benefits to one Rodolfo M. Lejano
had no jurisdiction over his person and over the offense charged as Expocorp is a by selling to him said Mercede[s] Benz through Newton Motors, Inc. represented by its President
private corporation and he is not a public employee or official; that Expocorp is not a Exequiel V. Mariano in the amount of Two Million Two Hundred Fifty Thousand Pesos
GOCC because it was not created by a special law, it did not have an original charter, (P2,250,000.00), without the requisite public bidding nor approval of the Board of Directors of
and a majority of Expocorps capital stock is owned by private individuals. He averred Expo Corporation and thereafter failed to deposit the proceeds of the sale of the aforementioned
vehicle to the account of Expo Corporation, to the damage and prejudice of the Corporation and
that upon Expocorps incorporation, BCDA owned essentially all of Expocorps stocks. the public interest as well.
2 months after its incorporation, Global became the majority owner with 55.16% of
 Morales moved for the dismissal of the case for lack of jurisdiction over his person
Expocorps stocks, while BCDA was left as minority stockholder with 44.84%.
and over the offense charged. He alleged that Expocorp is a private corporation
Sandiganbayan dismissed the information and SC affirmed.
and that he is not a public employee or official; that Sandiganbayan has no
DOCTRINE: Expocorp is a private corporation. It was not created by a special law
jurisdiction over his person or the offense charged as he is a private individual who
but was incorporated under the Corporation Code and was registered with the SEC. It
has not been charged jointly with other public officials or employees; that
is also not a GOCC. With the BCDA as a minority stockholder, Expocorp cannot be
Expocorp is not a government-owned or controlled corporation because it was not
characterized as a GOCC. A GOCC must be owned by the government, and in the case
created by a special law, it did not have an original charter, and a majority of
of a stock corporation, at least a majority of its capital stock must be owned by the
Expocorps capital stock is owned by private individuals; that he did not receive any
government.
compensation from the government as defined in Section 2(a) of R.A. No. 3019,
and the compensation he received as Expocorps acting president was paid from
FACTS: Expocorps funds.
 (June 13, 1991) then President Corazon Aquino issued A.O. No. 223 to  Office of the Special Prosecutor insisted that Expocorp is a government-owned
commemorate the 100th anniversary of the declaration of Philippine Independence corporation since its articles of incorporation showed that of its 10 listed
and thereby created the Committee for the National Centennial Celebrations in subscribers, BCDA held stocks valued at P99,999,100.00, while the stocks held by
1998 (Committee). the rest of the subscribers had a total value of P900.00. Also based on the Courts
 (1993) then President Fidel V. Ramos issued E.O. No. 128, entitled Reconstituting ruling in Salvador H. Laurel v. Aniano A. Desierto, NCC Chairman Laurel was a public
the Committee for the Preparation of the National Centennial Celebrations in officer; thus, Morales was likewise a public officer since his appointment flowed
1998. EO 128 renamed the Committee as the National Centennial Commission from the formers exercise of his authority as chairman of both NCC and
(NCC). The mandate of the NCC was to take charge of the nationwide Expocorp.
preparations for the National Celebration of the Philippine Centennial of the  Morales averred that upon Expocorps incorporation, BCDA owned essentially all
Declaration of Philippine Independence and the Inauguration of the Malolos of Expocorps stocks. Two months after its incorporation, however, the Board of
Congress. The late Vice-President Salvador Laurel was appointed as NCC Directors of Expocorp issued a resolution declaring all its unissued and
Chairman. unsubscribed shares open for subscription. Global Clark Assets Corporation
 (March 10, 1996) the NCC and the Bases Conversion Development Authority (Global) subscribed to essentially all of these unissued and unsubscribed shares;
(BCDA) organized the Philippine Centennial Expo 98 Corporation or Expocorp thus, Global became the majority owner with 55.16% of Expocorps stocks, while
whose primary purpose was to operate, administer, manage and develop the BCDA was left as minority stockholder with 44.84%. Also, the ruling
Philippine Centennial International Exposition 1998 (Expo 98). in Laurel[10] applied exclusively to Chairman Laurel.
 The Philippine Centennial project was marred by numerous allegations of
anomalies, among them, the lack of public biddings. Senator Ana Dominique
 Sandiganbayan: Dismissed the information against Morales. Expocorp is a private omissions as CEO of Expocorp must be viewed in the light of his powers and
corporation. functions as NCC Chair.
- In Laurel,[11] the Court only held that Laurel is a public officer without ruling  SC: Expocorp is a private corporation. It was not created by a special law but was
on whether Expocorp is a private or a government-owned corporation. The incorporated under the Corporation Code and was registered with the SEC. It is
Court also held that NCC performed executive functions, hence, it was a also not a GOCC. Although BCDA, which owned 999,991 shares of its shares, was
public office; consequently, its chairman, Laurel, was a public officer.  one of Expocorps original incorporators, the Board of Directors of Expocorp
Morales, in the case at bar, is being charged as president of Expocorp only and allowed Global to buy 1,229,998 of its unused and unsubscribed shares 2 months
not as an NCC official. after its incorporation. With the BCDA as a minority stockholder, Expocorp
- Expocorp was not created by a special law nor did it have an original cannot be characterized as a GOCC. Dante V. Liban, et al. v. Richard J. Gordon: A
charter. It was organized under the Corporation Code and was registered with GOCC must be owned by the government, and in the case of a stock corporation,
the SEC. Expocorp could not derive its public character from the fact that it at least a majority of its capital stock must be owned by the government.
was organized by the NCC. Applying the provisions of the Revised
Administrative Code of 1987, Expocorp is a private corporation because Whether Petitioner should be considered a public officer and thus falling under
Global owns 55.16% of its stocks; hence, its officers and employees are private SB jurisdiction – NO.
individuals who are outside the jurisdiction of the Sandiganbayan.  Section 5, Article XIII of the 1973 Constitution defines the jurisdiction of the
 Hence this petition for review on certiorari, filed by the People, to assail the Sandiganbayan: Sec. 5. The [Batasang Pambansa] shall create a special court, to be known as
Sandiganbayan Resolution. Sandiganbayan, which shall have jurisdiction over criminal and civil cases involving graft and corrupt
practices and such other offenses committed by public officers and employees, including those in
government-owned or controlled corporations, in relation to their office as may be determined by law.
RULING: The petition for review on certiorari is DISMISSED. The
 R.A. No. 8249, which amended Presidential Decree No. 1606, delineated the
Sandiganbayan’s Resolution in People vs. Morales, is AFFIRMED.
jurisdiction of the Sandiganbayan as follows (see underlined part in footnote)1
Whether Expocorp should be considered a public office – NO.  Since Expocorp is a private corporation, not a GOCC, Morales, as Expocorps
president who now stands charged for violating Section 3(e) of R.A. No. 3019 in
 People: Expocorp was an extension of the NCC as provided in Expocorps Articles
this capacity, is beyond the Sandiganbayans jurisdiction.
of Incorporation, specifically Section 2 which states Expocorps primary purpose to
establish and operate Expo 98 - an NCC project. Also, the position occupied by
respondent as President of Expocorp stemmed from his appointment as such by
NCC Chair and Expocorp Chief Executive Officer Salvador H. Laurel. Thus,
respondent served as the government’s representative and Laurel’s alter ego in
running the affairs of Expocorp. As held in the Laurel vs. Desierto case, even
assuming that Expocorp is a private corporation, petitioners position as CEO of
Expocorp arose from his Chairmanship of the NCC. Consequently, his acts or

1 Sec. 4. Jurisdiction. The Sandiganbayan shall exercise exclusive original jurisdiction in all cases involving: (f) City and provincial prosecutors and their assistants, and officials and prosecutors in the Office
a. Violations of Republic Act No. 3019, as amended, otherwise known as the Anti-graft and Corrupt of the Ombudsman and special prosecutor;
Practices Act, Republic Act No. 1379, and Chapter II, Section 2, Title VII, Book II of the Revised (g) Presidents, directors or trustees, or managers of government-owned or -controlled corporations,
Penal Code, where one or more of the accused are officials occupying the following positions in the state universities or educational institutions or foundations;
government whether in a permanent, acting or interim capacity, at the time of the commission of (2) Members of Congress and officials thereof classified as Grade '27' and up under the
the offense: Compensation and Position Classification Act of 1989;
(1) Officials of the executive branch occupying the positions of regional director and higher, (3) Members of the judiciary without prejudice to the provisions of the Constitution;
otherwise classified as Grade '27' and higher, of the Compensation and Position Classification Act (4) Chairmen and members of Constitutional Commissions, without prejudice to the provisions of
of 1989 (Republic Act No. 6758), specifically including: the Constitution; and
(a) Provincial governors, vice-governors, members of the Sangguniang panlalawigan and provincial (5) All other national and local officials classified as Grade '27' and higher under the Compensation
treasurers, assessors, engineers and other provincial department heads; and Position Classification Act of 1989.
(b) City mayors, vice-mayors, members of the sangguniang Panlungsod, city treasurers, assessors, b. Other offenses or felonies whether simple or complexed with other crimes committed by the
engineers and other city department heads; public officials and employees mentioned in subsection a of this section in relation to their office.
(c ) Officials of the diplomatic service occupying the position of consul and higher; c. Civil and criminal cases filed pursuant to and in connection with Executive Order Nos. 1, 2, 14
(d) Philippine army and air force colonels, naval captains, and all officers of higher rank; and 14-A, issued in 1986. (Underlining supplied.)
(e) Officers of the Philippine National Police while occupying the position of provincial director
and those holding the rank of senior superintendent or higher;