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SECOND DIVISION
[ G.R. No. 208183, August 31, 2022 ]
REPUBLIC OF THE PHILIPPINES, PETITIONER, VS. LT. COL. GEORGE ABONITO RABUSA, SG-25, MA. DEBBIE AREVALO RABUSA, AND FELIX AREVALO, RESPONDENTS.
D E C I S I O N
LOPEZ, J., J.:
To recover the unexplained or ill-gotten wealth allegedly amassed by a public officer under Republic Act (R.A.) No. 1379, it is upon the Republic to prove the allegations in its complaint. It is, therefore, imperative that "the operative act on how and in what manner the public officer participated in amassing ill-gotten wealth be demonstrated through preponderance of evidence."[1]
Before this Court is the Petition for Review on Certiorari[2] under Rule 45 of the Rules of Court filed by the Republic of the Philippines (Republic), assailing the Decision[3] dated November 26, 2012 and the Resolution[4] dated June 25, 2013 of the Court of Appeals (CA) in CA-G.R. CV No. 95545. The CA Decision affirmed the Decision[5] dated December 14, 2009 of the Regional Trial Court, Branch 59, Makati City (RTC), which dismissed the Petition for Forfeiture of Unlawfully Acquired Properties against Lt. Col. George Abonito Rabusa (Rabusa), Ma. Debbie Arevalo Rabusa (Ma. Debbie), and Felix Arevalo (collectively, Rabusa, et al.), for failure to prove culpability by preponderance of evidence.
Antecedents
The basic antecedents are no longer disputed.
The present action stems from a Petition for Forfeiture of Unlawfully Acquired Properties under R.A. No. 1379, as amended, with verified urgent ex parte application for the issuance of a writ of preliminary attachment[6] filed by the Republic against Rabusa, et al. on December 6, 2004.
The petition alleged that Rabusa was in continuous active service as an officer of the Armed Forces of the Philippines (AFP) since March 15, 1981.[7] As a requirement for service, he has submitted his sworn declarations in his Statements of Assets, Liabilities and Net Worth (SALN), which reveal that his total government salary and income from other sources earned from the years 1990-2003[8] amounted to P13,579,433.60. Rabusa also disclosed that his spouse, respondent Ma. Debbie received her partial inheritance and some other donations amounting to P4,120,000.00. Meanwhile, Rabusa's total personal and family expenses totaled P21,025,854.60. Considering that his total expenses manifestly exceeded his total income, the Republic asserts that Rabusa was spending more than what can be legitimately sustained. In fact, in the years 1998, 2000, 2001, 2002, and 2003, his reported expenses were remarkably and consistently higher in contrast to his reported salary and income from other sources.[9]
Such inconsistencies prompted the Office of the Ombudsman to conduct an investigation, which yielded the following as having remained undeclared by Rabusa in his SALNs,[10] to wit:
For his part, Rabusa contended, inter alia, that their lifestyle and assets are acceptable and amply substantiated, as their expenses were reasonably augmented by Ma. Debbie's partial inheritance and accumulated donations from her father in the amount of P4,120,000.00, as well as her salary from her employment at Art Net Café and Tri-Alpha, earning P15,000.00 and P45,000.00 per month, respectively. He further explained that he secured a loan from the Bank of the Philippine Islands in the amount of P1,500,000.00 and, that sometime on June 3, 1999, he sold his property located at Better Living Subdivision, Parañaque City. While he admitted to having AFPSLAI accounts, the contents were not solely his personal funds but of close relatives and friends, which were deposited in his personal account to take advantage of the high 20% interest rate offered to members of the AFP.[14]
As for Felix, he justified his expenses due to his retirement pay of around P950,000.00, upon retiring from the Makati Police Force in 1995, as well as obtaining a personal loan of P5,000,000.00.[15]
After trial on the merits, the RTC rendered a Decision[16] on December 14, 2009, dismissing the petition for failure of the petitioner to prove liability by preponderance of evidence. Essentially, the RTC found Rabusa, et al.'s explanations satisfactory in overcoming the Republic's argument that the latter had illegally amassed and accumulated wealth more than that declared in the presented SALNs. The dispositive portion of the decision reads:
The Republic elevated the matter to the CA, arguing in the main that the evidence of Rabusa, et al. failed to overcome the inescapable conclusion that their accumulated wealth and assets were unlawfully acquired and were thus subject to forfeiture proceedings. Specifically, the Republic raised the following issues in support of its appeal, namely: (1) whether the court a quo gravely erred in holding that the subject bank accounts are inadmissible as evidence in the forfeiture of unlawfully acquired properties case (Civil Case No. 04-1321) for being violative of R.A. No. 1405, or the "Bank Secrecy Act of 1995," considering that the money in the subject bank accounts is the subject of litigation; (2) whether the court a quo gravely erred in ruling that the millions of pesos deposited in the AFPSLAI accounts of respondents do not solely belong to them but also to their close relatives and friends as investments; and lastly, (3) whether the court a quo gravely erred in ruling that the premium payment of US$64,755.00 for Philam Insurance Policy No. 1003550245 in the name of Diana Rabusa and the premium payment of US$67,730.00 for Philam Insurance Policy No. 1003550254 in the name of Dorothy Grace Rabusa came from the monetary gifts on various occasions of one Corazon Pitcock to Rabusa and Ma. Debbie.[19]
Acting thereon, the CA affirmed the RTC ruling in its assailed Decision[20] dated November 26, 2012. The fallo provides:
A Motion for Reconsideration was filed by the Republic, which was denied in a Resolution[22] dated June 25, 2013 for raising the same grounds already passed upon in the assailed Decision.
Hence, the instant petition.
In response, Rabusa, et al. filed their Comment[23] asserting that the petition is a mere rehash and reiteration of previous arguments squarely resolved by the RTC and on appeal by the CA. They point out that all the issues raised in the petition are questions of fact, which remain outside the purview of this Court.
On the other hand, the Republic postures in its Reply[24] that the issues raised concern questions of law, particularly, whether the subject accounts fall under the exceptions of R.A. No. 1405, as the RTC itself issued several court orders via subpoena duces tecum and ad testificandum authorizing its examination. It argues that the accounts themselves were the subject matter of the litigation, as the contents thereof were the very subject of forfeiture, having been illegally amassed. It insists that no concrete evidence was presented by the respondents to substantiate their claim that the questioned money belonged to investors taking advantage of the AFP interest rate. Lastly, it reiterates that the relation between the monetary gifts from Corazon Pitcock and the premium payments had not been established, there being no relation between the two.
The Issues
Petitioner relies on the following grounds for review, as follows:
Our Ruling
This Court resolves to partially grant the petition.
Prefatorily, a cursory reading of the present petition would reveal that it is a mere rehash of factual issues and arguments raised by petitioner in its appeal which had already been fully passed upon and considered by the CA. Whether respondents' bank accounts are covered by the exceptions laid down in R.A. No. 1405, the question of ownership of the AFPSLAI accounts, or the source of the premium payments, are undeniably questions of fact that would necessitate a reassessment and reexamination of the evidence. As a matter of sound practice and procedure, this Court defers and accords finality to the factual findings of trial courts. To do otherwise would defeat the very essence of Rule 45 and would convert the Court into a trier of facts, which is not its intended purpose under the law.
At any rate, such rule admits of exceptions. In The Insular Life Assurance Company, Ltd. v. Court of Appeals,[26] this Court held that it may review the evidence on record should the assailed judgment be based on a misapprehension of facts, or when the CA overlooked certain relevant facts not disputed by the parties, which, if properly considered, would justify a different conclusion.[27] After a careful assessment, this Court finds that such exceptions are attendant in the instant case which shall be further elaborated below. Discernibly, a review of the factual matters is warranted.
This Court shall now resolve the substantial merits of the case.
The CA erred in ruling that the
bank deposits do not fall under any
of the exceptions of R.A. No. 1405.
On the other hand, the foreign
currency deposits are protected
under R.A. No. 6426.
R.A. No. 1405 statutorily grants persons with a legitimate expectation of privacy on their respective bank accounts. Its rationale is to "discourage private hoarding, as well as to give encouragement to people to deposit their money in banking institutions, so that the same may be properly utilized by banks in authorized loans and thereby assist in the country's economic development."[28] At its core, the law establishes the basic state policy on the confidentiality of bank deposits as institutionalized in Section 2, to wit:
This Court is well aware of the caveat that there is much disfavor towards construing these exceptions in such a manner that would authorize unlimited discretion on the part of the government or of any party seeking to enforce these exceptions and inquire into bank deposits. Should there be any doubts in upholding the absolutely confidential nature of bank deposits against affirming the authority to inquire into such accounts, then these must be resolved in favor of confidentiality. Such a stance would persist, unless Congress passes a law reversing the general state policy of preserving the absolutely confidential nature of Philippine bank accounts.[31]
In taking exclusion from the coverage of the confidentiality rule, petitioner argues that the bank accounts maintained by respondents fall under two such exceptions, namely: (1) the examination thereof 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.
Anent the first exception, petitioner applies the ruling in Philippine National Bank v. Gancayco,[32] wherein this Court clarified that cases of unexplained wealth are analogous to cases involving bribery and dereliction of duty, both involving public officials. Effectively, cases of unexplained wealth are now considered as an additional exception to the rule under R.A. No. 1405 making bank deposits confidential. By analogy, since a petition under R.A. No. 1379 pertains to the forfeiture of unexplained wealth and illegally acquired properties, the exception prescribed under R.A. No. 1405 shall perforce apply to it. In the instant case, given that the court orders in the form of various subpoena duces tecum and ad testificandum all involve the forfeiture of unexplained wealth, the RTC was in error for not allowing petitioner to examine, inquire, and look into the subject accounts.
As to the second exception, petitioner contends that the amounts deposited into the subject accounts are the very subject matter of the litigation. It explains that it filed the forfeiture case in order to examine the legitimacy of respondents' acquisition of the properties, as well as to inquire into the whereabouts of the amount acquired by them illegally. Further, it seeks to recover the money deposited in the subject accounts, which are both allegedly ill-gotten and unexplained.
Petitioner's arguments deserve credence. There is compelling reason to hold that the subject accounts fall squarely within the statutory exceptions and may be subject to disclosure.
Regarding the first exception, this Court held in Gancayco that the phrase pertaining to the exception "upon order of a competent court in cases of bribery or dereliction of duty of public officials"[33] is not exclusive. In fact, similar cases, such as cases of unexplained wealth, may be considered as falling within the same exception. This Court's pronouncements are enlightening:
With respect to the second exception, this Court finds that the subject accounts themselves are the very "subject matter of litigation."
What constitutes the very subject matter of litigation pursuant to the exceptions in Section 2 of R.A. No. 1405 has been amply addressed in Union Bank of the Philippines v. Court of Appeals:[36]
The ruling in BSB Group, Inc. v. Go[43] further sustains this conclusion. In this case, respondent, who was employed by petitioner as cashier, was charged with qualified theft for allegedly taking the checks of petitioner's customers and depositing the same into her personal account instead of being turned over to the company's coffers. On the premise that respondent had encashed customers' checks and deposited the corresponding amounts thereof to her personal account, the prosecution moved for the issuance of subpoenas duces tecum and ad testificandum against the respective managers or records custodians of respondent's banks. In finding the evidence adduced by the respective subpoenas inadmissible, this Court ruled that they were deemed irrelevant as they pertained to the contents of the accounts where respondent had deposited the proceeds of the misappropriated checks, and not the amounts she had taken in line with her prosecution for qualified theft of cash. Elsewise stated, the evidence procured from the subpoenas were deemed inadmissible for irrelevance as the accounts sought to be examined had no relation to the criminal charges filed against respondent for qualified theft of cash:
The respondents' foreign currency deposit accounts, however, face a different fate. Uncontroverted by respondents are their four foreign currency deposit accounts, namely:
The CA did not err in concurring with the
RTC that (a) deposits in the AFPSLAI
accounts do not solely belong to respondents;
and (b) premium payments for the Philam
Insurance Policies were sourced from
monetary gifts.
Pertinent in this case are the ownership of the amounts deposited in the AFPSLAI accounts, as well as the source of payment of the Philam Insurance Policies in favor of Rabusa and Ma. Debbie's daughters, Diana and Dorothy Grace Rabusa.
Petitioner argues that other than the self-serving statements in the affidavits of respondent Rabusa and Ma. Debbie's friends and relatives, no concrete evidence was presented by the latter to substantiate their claim that the questioned money did indeed belong to the alleged investors, namely, Menandro Santos, Myrna Dimaano, Sheffered Tan, and Damian Mercado.[49] While they had submitted affidavits, petitioner insists that they failed to specifically state the amount of their investments; neither did they proffer any documentary evidence as proof of such arrangement. To add, petitioner maintains that there was no clear proof that the premium payments relative to the Philam Insurance Policies in favor of Diana and Dorothy Grace Rabusa were paid out from the monetary gifts given by Corazon Pitcock.
Juxtaposing the specific allegations in the petition with petitioner's documentary and testimonial evidence and as against the respondents' documentary and testimonial evidence, this Court agrees with the RTC and the CA that the weight of evidence fails to preponderate in petitioner's favor.
In the present case, it appears that aside from presenting the affidavits of Menandro Santos, Myrna Dimaano, Shefferd Tan, and Damian Mercado disclosing their request to deposit certain amounts to the accounts of Rabusa and Ma. Debbie in order to take advantage of the special interest rate, they were likewise presented to testify in open court during the proceedings in the RTC.[50] Contrary to petitioner's asseveration, respondents stipulated the respective amounts given by the depositors to wit:
With regard to the Philam Insurance Policies, this Court cannot ignore that respondents presented Corazon Pitcock as a witness, who testified in open court that she had indeed made certain monetary gifts on various occasions as godparent to Rabusa and Ma. Debbie when they were married.[53] Nominally, no shred of evidence was presented by petitioner to corroborate its claims that such monetary gifts given by Corazon Pitcock were not used towards the payment of the Philam insurance policies.
Towards this end, this Court finds no error in the trial courts' appreciation of the credibility of respondents' witnesses. Nothing on record appears to have been overlooked or misconstrued. Necessarily, the long-settled rule as iterated in People v. Edaño[54] is apropos:
Similarly, a reliance on Ma. Debbie's travel records,[58] as well as those of daughters Diana and Dorothy Grace,[59] does not necessarily prove the existence of unexplained wealth. As culled from the records of the Bureau of Investigation (BI), an examination thereof could only establish the details of such trips, such as the dates of departure and arrival, the destination, as well as the frequency of travel.
It is quite a stretch to conclude from the evidence presented that the foreign trips taken by Rabusa and his family were beyond their financial capacity, especially since no effort was exerted by petitioner to even determine the exact costs of these frequent trips. In Pleyto v. Philippine National Police Criminal Investigation and Detection Group,[60] this Court cautioned that the "frequency of foreign travel, by itself, is not proof of unexplained wealth of a public official or employee."[61] As already concluded by this Court, Rabusa had other sources of funds apart from his salary as a public official. Likewise settled is the fact that Ma. Debbie was also earning substantial income from her gainful employment at Art Net Café and Tri-Alpha, not to mention her partial inheritance she received from her father.
To further disparage petitioner's arguments, Rabusa cannot be expected to declare the house and lot located in Sto. Tomas, Batangas in his SALN, for the simple reason that such property belonged and was registered under the name of his father-in-law, Felix. Neither was there any showing that Felix was a co-conspirator or a mere conduit in an attempt to conceal the true value of Rabusa's wealth. Plainly, the need for public officials to declare assets in their SALNs does not extend to those registered and owned by other persons. To reiterate, the burden is upon the petitioner to establish that the property in question are actually owned by Rabusa, and prove that the cost is beyond his financial capacity. Unfortunately, petitioner fell short in this regard.
The quantum of evidence required
for forfeiture proceedings under
R.A. No. 1379 is preponderance of
evidence. Thus, the RTC should
have considered evidence from
respondents' subject accounts.
Necessarily, a remand of the case to
the RTC is proper.
To recall, this case is one involving the forfeiture of assets and properties that have been illegally acquired or misappropriated, pursuant to R.A. No. 1379. More particularly, the law provides for the procedure by which forfeiture proceedings may be instituted against public officers or employees who "[have] acquired during his [or her] incumbency an amount of property which is manifestly out of proportion to his [or her] salary as such public officer or employee and to his [or her] other lawful income and the income from legitimately acquired property, [which] property shall be presumed prima facie to have been unlawfully acquired."[62]
In Garcia v. Sandiganbayan, et al.,[63] this Court re-affirmed the principle that forfeiture proceedings under R.A. No. 1379 are civil in nature. In an earlier case,[64] this Court confirmed:
Ultimately, this Court finds that the RTC and the CA validly considered and weighed the evidence regarding respondents' other assets and expenses, namely, the AFPSLAI accounts, the insurance policies, the respondents and their family's travel history, as well as the property belonging to Rabusa's father-in-law, Felix. As painstakingly discussed, Rabusa adequately justified such discrepancies, even readily admitting to his wife's financial capacity and all their recent transactions, which would belie any malicious intent to conceal or to commit any dishonesty to the public.
Nevertheless, the RTC would have more basis on disposing the case based on a preponderance of evidence if it had taken into consideration the evidence adduced from the respondents' subject accounts. As observed by Senior Associate Justice Leonen, the combined contents of such accounts total to over P10,000,000.00.[70]
As a final point, this Court recognizes the difficulty in prosecuting a case for corruption, especially when it involves recovering what rightfully belongs to the government and the Republic from the hands of no less than a public official. While petitioner must be commended for its efforts to hold Rabusa accountable for his alleged unexplained wealth and unlawfully acquired properties, it must concede to the judiciary to make a just and complete disposition of the case by adhering to the standards of evidence carved out especially for cases under R.A. No. 1379.
Consequently, a full-blown hearing on the merits is required, including the reception of additional evidence, if needed, from both parties. This Court enjoins the lower court to take on this responsibility in order to meaningfully uphold the rule that public office is a public trust, as this Court is barred from reviewing factual matters.
ACCORDINGLY, premises considered, the instant petition is PARTIALLY GRANTED. The Decision dated November 26, 2012 and the Resolution dated June 25, 2013 of the Court of Appeals in CA-G.R. CV No. 95545 are AFFIRMED with MODIFICATION. The case is REMANDED to the Regional Trial Court, Branch 59, Makati City for the purpose of reconsidering the evidence on the subject bank accounts of respondents.
SO ORDERED.
Lazaro-Javier, Zalameda,* and Kho, Jr., JJ., concur.
Leonen, SAJ. (Chairperson), see separate concurring opinion.
* Designated additional member in lieu of Associate Justice Mario V. Lopez, per Raffle dated March 28, 2022.
[1] Republic of the Philippines v. Cuenca, et al., 829 Phil. 139, 173 (2018) [Per J. Tijam, First Division].
[2] Rollo, pp. 11-43.
[3] Penned by Associate Justice Socorro B. Inting (now a member of this Court), with Associate Justices Jose C. Reyes, Jr. (a retired member of this Court) and Mario V. Lopez (now a member of this Court), concurring; id. at 45-54.
[4] Id. at 56-57.
[5] Penned by Judge Winlove M. Dumayas; id. at 262-269.
[6] Rollo, pp. 58-88.
[7] Id. at 61.
[8] Id. at 89-135.
[9] Id. at 63.
[10] Id. at 64-73.
[11] Id. at 149-180.
[12] Id. at 70-73; 156-163.
[13] Id. at 73-74.
[14] Id. at 46-47.
[15] Id. at 47.
[16] Id. at 262-269.
[17] Id. at 269.
[18] Id. at 272-273.
[19] See Appellant's Brief; id. at 182-183.
[20] Rollo, pp. 45-54.
[21] Id. at 53.
[22] Id. at 56-57.
[23] Id. at 326-338.
[24] Id. at 369-382.
[25] Id. at 25.
[26] 472 Phil. 11 (2004) [Per J. Austria-Martinez, Second Division].
[27] Id. at 23.
[28] R.A. NO. 1405, SEC. 2.
[29] Id.
[30] Presidential Decree No. 1972, as amended by R.A. No. 7653; R.A. No. 3019; R.A. No. 9160.
[31] Mendoza v. Court of Appeals, 802 Phil. 314, 352 (2016) [Per J. Perez, En Banc].
[32] 122 Phil. 503, 508 (1965) [Per J. Regala, En Banc].
[33] Philippine National Bank v. Gancayco, supra.
[34] Id. at 507-508.
[35] Rollo, pp. 226-261.
[36] 378 Phil. 1177 (1999) [Per J. Kapunan, First Division].
[37] Id. at 1182-1183.
[38] 268 Phil. 697 (1990) [Per C.J. Fernan, Third Division].
[39] Id. at 713.
[40] Entitled "Anti-Graft and Corrupt Practices Act."
[41] As amended by BP Blg. 195, March 16, 1982.
[42] Rollo, p. 51.
[43] 626 Phil. 501 (2010) [Per J. Peralta, Third Division].
[44] Id. at 516-517.
[45] See Separate Concurring Opinion, p. 5.
[46] 427 Phil. 293, 304 (2002) [Per J. De Leon, Jr., Second Division].
[47] R.A. NO. 6426, SEC. 8.
[48] As amended by PD No. 1035, and further amended by PD No. 1246, promulgated Nov. 21, 1977.
[49] Rollo, pp. 339-342.
[50] See RTC Decision; id. at 266.
[51] Rollo, p. 335.
[52] Id. at 266.
[53] See RTC Decision; id. at 267.
[54] 159-A Phil. 934 (1975) [Per J. Antonio, Second Division].
[55] Id. at 939-940.
[56] Rollo, p. 266.
[57] Id. at 156-157.
[58] Id. at 151-153.
[59] Id. at 158-161.
[60] 563 Phil. 842 (2007) [Per J. Chico-Nazario, Third Division].
[61] Id. at 896.
[62] R.A. NO. 1379, SEC. 2.
[63] 618 Phil. 346, 361 (2009) [Per J. Velasco, Jr., Third Division].
[64] Almeda v. Hon. Perez, 116 Phil. 120 (1962) [Per J. Labrador, En Banc].
[65] Id. at 125-126.
[66] Republic of the Philippines v. Gimenez, 776 Phil. 233, 252 (2016) [Per J. Leonen, Second Division].
[67] RULES OF COURT, RULE 133, SEC. 1.
[68] Encinas v. National Bookstore, Inc., 485 Phil. 683, 695 (2004) [Per J. Tinga, Second Division].
[69] Republic of the Philippines v. Cuenca, et al., supra note 1, at 173.
[70] See Separate Concurring Opinion, p. 8.
Before this Court is the Petition for Review on Certiorari[2] under Rule 45 of the Rules of Court filed by the Republic of the Philippines (Republic), assailing the Decision[3] dated November 26, 2012 and the Resolution[4] dated June 25, 2013 of the Court of Appeals (CA) in CA-G.R. CV No. 95545. The CA Decision affirmed the Decision[5] dated December 14, 2009 of the Regional Trial Court, Branch 59, Makati City (RTC), which dismissed the Petition for Forfeiture of Unlawfully Acquired Properties against Lt. Col. George Abonito Rabusa (Rabusa), Ma. Debbie Arevalo Rabusa (Ma. Debbie), and Felix Arevalo (collectively, Rabusa, et al.), for failure to prove culpability by preponderance of evidence.
The basic antecedents are no longer disputed.
The present action stems from a Petition for Forfeiture of Unlawfully Acquired Properties under R.A. No. 1379, as amended, with verified urgent ex parte application for the issuance of a writ of preliminary attachment[6] filed by the Republic against Rabusa, et al. on December 6, 2004.
The petition alleged that Rabusa was in continuous active service as an officer of the Armed Forces of the Philippines (AFP) since March 15, 1981.[7] As a requirement for service, he has submitted his sworn declarations in his Statements of Assets, Liabilities and Net Worth (SALN), which reveal that his total government salary and income from other sources earned from the years 1990-2003[8] amounted to P13,579,433.60. Rabusa also disclosed that his spouse, respondent Ma. Debbie received her partial inheritance and some other donations amounting to P4,120,000.00. Meanwhile, Rabusa's total personal and family expenses totaled P21,025,854.60. Considering that his total expenses manifestly exceeded his total income, the Republic asserts that Rabusa was spending more than what can be legitimately sustained. In fact, in the years 1998, 2000, 2001, 2002, and 2003, his reported expenses were remarkably and consistently higher in contrast to his reported salary and income from other sources.[9]
Such inconsistencies prompted the Office of the Ombudsman to conduct an investigation, which yielded the following as having remained undeclared by Rabusa in his SALNs,[10] to wit:
- Subscribed and paid-up capital shares amounting to P1,000,000.00 by virtue of being stockholders and members of the Board of Directors of Arevalo, Rabusa, Templora, Inc. (ARTI), together with his spouse Ma. Debbie;
- The following vehicles registered under his name: (1) 1978 Toyota Corolla with Plate Number NNU 647, MV File No. 1328-85888, Engine No. 12RM-036018, Chassis No. ET 130-905363; (2) 1997 Toyota Corolla with Plate Number UTB 513, MV File No. 1366-33934, Engine No. 4A-L1917194, Chassis No. AE101-9093537, valued at P350,000.00. Petitioner likewise believes that the 2002 Isuzu Trooper Wagon with Plate Number XAE 573 valued at P1,200,000.00 registered in the name of Ma. Debbie, is also owned by Rabusa;[11]
- Capital contributions and savings under Armed Forces and Police Savings and Loan Association, Inc. (AFPSLAI) Account Number 61-001-187742-7 under his name, and 630-01-409-084-3 under Ma. Debbie's name, amounting to P10,542,730.44;
- The following accounts in the following financial institutions owned and maintained by Rabusa, Ma. Debbie, and their children, amounting to around P10,000,000.00, particularly:
Security Bank Corporation Account NameAccount NumberGeorge Rabusa0515-340448-200 (PhP)George Rabusa0513-360320-001 (PhP)George Abonito Rabusa0515-326141-001 (PhP)George Rabusa/Debbie Arevalo Rabusa0513-332307-001 (PhP)George Rabusa /Debbie Arevalo Rabusa0513-332309-201 (PhP)George Rabusa /Debbie Arevalo Rabusa0515-332307-551 (USD)George Rabusa/Debbie Arevalo Rabusa0515-332307-552 (USD)George Rabusa /Debbie Arevalo Rabusa0515-332307-200 (USD)George Rabusa /Debbie Arevalo Rabusa0515-332307-201 (USD)George Rabusa /Debbie Arevalo Rabusa0513-332304-201 (PhP)George Rabusa /Debbie Arevalo Rabusa0513-332305-201 (PhP)Debbie Arevalo Rabusa51550154115 (PhP)Land Bank of the Philippines Account NameAccount NumberGeorge Rabusa0556003904 (PhP)Bank of the Philippine Islands Account NameAccount NumberDebbie A. Rabusa0296128623 (PhP)Debbie A. Rabusa0296170107 (PhP) - Total premiums amounting to US$132,485.00 paid by Rabusa and Ma. Debbie for the insurance of their two daughters with Philippine American Life and General Insurance Company (Philam):Date PaidName of InsuredPolicy No.Amount of Premium Paid (in USD)February 13, 2004Diana A. Rabusa100355024564,755.00February 13, 2004Dorothy Grace Arevalo Rabusa100355025467,730.00Total Premium Payment132,485.00
- A house and lot located in San Antonio Heights, Sto. Tomas, Batangas, valued at P1,600,000.00, registered under the name of Rabusa's father-in-law, respondent Felix.
George A. Rabusa
Ma. Debbie A. Rabusa
Daniel George A. Rabusa
In sum, Rabusa, et al. allegedly accumulated funds and properties in the aggregate amount of P43,096,081.99. Being manifestly out of proportion to Rabusa's declared salary and other lawful income, the Republic prayed that such undeclared amounts should be classified as unlawfully acquired and thus declared forfeited in its favor.[13]Diana Grace and Dorothy Grace A. Rabusa
For his part, Rabusa contended, inter alia, that their lifestyle and assets are acceptable and amply substantiated, as their expenses were reasonably augmented by Ma. Debbie's partial inheritance and accumulated donations from her father in the amount of P4,120,000.00, as well as her salary from her employment at Art Net Café and Tri-Alpha, earning P15,000.00 and P45,000.00 per month, respectively. He further explained that he secured a loan from the Bank of the Philippine Islands in the amount of P1,500,000.00 and, that sometime on June 3, 1999, he sold his property located at Better Living Subdivision, Parañaque City. While he admitted to having AFPSLAI accounts, the contents were not solely his personal funds but of close relatives and friends, which were deposited in his personal account to take advantage of the high 20% interest rate offered to members of the AFP.[14]
As for Felix, he justified his expenses due to his retirement pay of around P950,000.00, upon retiring from the Makati Police Force in 1995, as well as obtaining a personal loan of P5,000,000.00.[15]
After trial on the merits, the RTC rendered a Decision[16] on December 14, 2009, dismissing the petition for failure of the petitioner to prove liability by preponderance of evidence. Essentially, the RTC found Rabusa, et al.'s explanations satisfactory in overcoming the Republic's argument that the latter had illegally amassed and accumulated wealth more than that declared in the presented SALNs. The dispositive portion of the decision reads:
WHEREFORE, premises considered, for failure of petitioner Republic of the Philippines to prove by preponderance of evidence the liability of respondents Lt. Col. George Rabusa, Debbie Rabusa and Felix [Arevalo], the present petition is hereby DISMISSED. Likewise, the counterclaim filed by respondents against petitioner is hereby DISMISSED. Accordingly, the Preliminary Attachment issued in the above-entitled case is hereby lifted and set aside. No pronouncement as to cost.Undeterred, the Republic immediately sought for reconsideration of the Decision but the same was denied in an Order[18] dated March 3, 2010. In denying the motion, the RTC concluded that the allegations and arguments interposed by petitioner were a mere rehash of its previous pleadings which were already passed upon in its December 14, 2009 Decision.
SO ORDERED.[17]
The Republic elevated the matter to the CA, arguing in the main that the evidence of Rabusa, et al. failed to overcome the inescapable conclusion that their accumulated wealth and assets were unlawfully acquired and were thus subject to forfeiture proceedings. Specifically, the Republic raised the following issues in support of its appeal, namely: (1) whether the court a quo gravely erred in holding that the subject bank accounts are inadmissible as evidence in the forfeiture of unlawfully acquired properties case (Civil Case No. 04-1321) for being violative of R.A. No. 1405, or the "Bank Secrecy Act of 1995," considering that the money in the subject bank accounts is the subject of litigation; (2) whether the court a quo gravely erred in ruling that the millions of pesos deposited in the AFPSLAI accounts of respondents do not solely belong to them but also to their close relatives and friends as investments; and lastly, (3) whether the court a quo gravely erred in ruling that the premium payment of US$64,755.00 for Philam Insurance Policy No. 1003550245 in the name of Diana Rabusa and the premium payment of US$67,730.00 for Philam Insurance Policy No. 1003550254 in the name of Dorothy Grace Rabusa came from the monetary gifts on various occasions of one Corazon Pitcock to Rabusa and Ma. Debbie.[19]
Acting thereon, the CA affirmed the RTC ruling in its assailed Decision[20] dated November 26, 2012. The fallo provides:
WHEREFORE, the decision appealed from is AFFIRMED.The CA resolved that the bank accounts of Rabusa, et al. were protected under R.A. No. 1405. Given the arbitrary demand to disclose the contents thereof, the CA considered the inquiry as a fishing expedition to utilize evidence against Rabusa, et al. The CA also observed that some accounts in question were foreign deposits falling under R.A. No. 6426, or the "Foreign Currency Deposit Act of the Philippines," which explicitly allows the disclosure of a foreign deposit account only by virtue of a written permission of the depositor, which was plainly lacking in this case. Concurring with the RTC, the CA found no irregularity in terms of the AFPSLAI investments and the premium payments. With respect to the AFPSLAI investments, the CA granted credence to the affidavits of certain friends and relatives of Rabusa, et al., who were presented in open court to confirm that they had deposited funds with the latter in order to take advantage of the high interest rate accorded to AFP members. It similarly concurred with the RTC that the premium payments for the Philam Insurance Policies in the name of Diana Dorothy Grace Rabusa were paid from the monetary gifts given by a certain Corazon Pitcock, a godparent of Rabusa and Ma. Debbie.
SO ORDERED.[21]
A Motion for Reconsideration was filed by the Republic, which was denied in a Resolution[22] dated June 25, 2013 for raising the same grounds already passed upon in the assailed Decision.
Hence, the instant petition.
In response, Rabusa, et al. filed their Comment[23] asserting that the petition is a mere rehash and reiteration of previous arguments squarely resolved by the RTC and on appeal by the CA. They point out that all the issues raised in the petition are questions of fact, which remain outside the purview of this Court.
On the other hand, the Republic postures in its Reply[24] that the issues raised concern questions of law, particularly, whether the subject accounts fall under the exceptions of R.A. No. 1405, as the RTC itself issued several court orders via subpoena duces tecum and ad testificandum authorizing its examination. It argues that the accounts themselves were the subject matter of the litigation, as the contents thereof were the very subject of forfeiture, having been illegally amassed. It insists that no concrete evidence was presented by the respondents to substantiate their claim that the questioned money belonged to investors taking advantage of the AFP interest rate. Lastly, it reiterates that the relation between the monetary gifts from Corazon Pitcock and the premium payments had not been established, there being no relation between the two.
Petitioner relies on the following grounds for review, as follows:
I. The Court of Appeals seriously erred in ruling that none of the exceptions to the confidentiality of bank deposits apply in the present case;II. The Court of Appeals seriously erred in concurring with the findings and conclusion of the RTC that the millions of pesos deposited in Rabusa and Debbie's AFPSLAI accounts do not solely belong to them;III. The Court of Appeals seriously erred in concurring with the findings and conclusion of the RTC that the premium payments for the Philam Insurance Policies in the names of Diana and Dorothy Grace Rabusa came from the monetary gifts on various occasions of one Corazon Pitcock.[25]
This Court resolves to partially grant the petition.
Prefatorily, a cursory reading of the present petition would reveal that it is a mere rehash of factual issues and arguments raised by petitioner in its appeal which had already been fully passed upon and considered by the CA. Whether respondents' bank accounts are covered by the exceptions laid down in R.A. No. 1405, the question of ownership of the AFPSLAI accounts, or the source of the premium payments, are undeniably questions of fact that would necessitate a reassessment and reexamination of the evidence. As a matter of sound practice and procedure, this Court defers and accords finality to the factual findings of trial courts. To do otherwise would defeat the very essence of Rule 45 and would convert the Court into a trier of facts, which is not its intended purpose under the law.
At any rate, such rule admits of exceptions. In The Insular Life Assurance Company, Ltd. v. Court of Appeals,[26] this Court held that it may review the evidence on record should the assailed judgment be based on a misapprehension of facts, or when the CA overlooked certain relevant facts not disputed by the parties, which, if properly considered, would justify a different conclusion.[27] After a careful assessment, this Court finds that such exceptions are attendant in the instant case which shall be further elaborated below. Discernibly, a review of the factual matters is warranted.
This Court shall now resolve the substantial merits of the case.
The CA erred in ruling that the
bank deposits do not fall under any
of the exceptions of R.A. No. 1405.
On the other hand, the foreign
currency deposits are protected
under R.A. No. 6426.
R.A. No. 1405 statutorily grants persons with a legitimate expectation of privacy on their respective bank accounts. Its rationale is to "discourage private hoarding, as well as to give encouragement to people to deposit their money in banking institutions, so that the same may be properly utilized by banks in authorized loans and thereby assist in the country's economic development."[28] At its core, the law establishes the basic state policy on the confidentiality of bank deposits as institutionalized in Section 2, to wit:
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.The law itself is not ironclad and prescribes four exceptions when records of deposits may be disclosed. These are under any of the following instances: (1) upon written permission of the depositor; (2) in cases of impeachment; (3) upon order of a competent court in the case of bribery or dereliction of duty of public officials; or (4) when the money deposited or invested is the subject matter of the litigation.[29] While subsequent statutory enactments[30] have expanded the scope of exceptions to this policy, the secrecy of bank deposits still lies as the general rule, falling as it does within the legally-recognized zones of privacy.
This Court is well aware of the caveat that there is much disfavor towards construing these exceptions in such a manner that would authorize unlimited discretion on the part of the government or of any party seeking to enforce these exceptions and inquire into bank deposits. Should there be any doubts in upholding the absolutely confidential nature of bank deposits against affirming the authority to inquire into such accounts, then these must be resolved in favor of confidentiality. Such a stance would persist, unless Congress passes a law reversing the general state policy of preserving the absolutely confidential nature of Philippine bank accounts.[31]
In taking exclusion from the coverage of the confidentiality rule, petitioner argues that the bank accounts maintained by respondents fall under two such exceptions, namely: (1) the examination thereof 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.
Anent the first exception, petitioner applies the ruling in Philippine National Bank v. Gancayco,[32] wherein this Court clarified that cases of unexplained wealth are analogous to cases involving bribery and dereliction of duty, both involving public officials. Effectively, cases of unexplained wealth are now considered as an additional exception to the rule under R.A. No. 1405 making bank deposits confidential. By analogy, since a petition under R.A. No. 1379 pertains to the forfeiture of unexplained wealth and illegally acquired properties, the exception prescribed under R.A. No. 1405 shall perforce apply to it. In the instant case, given that the court orders in the form of various subpoena duces tecum and ad testificandum all involve the forfeiture of unexplained wealth, the RTC was in error for not allowing petitioner to examine, inquire, and look into the subject accounts.
As to the second exception, petitioner contends that the amounts deposited into the subject accounts are the very subject matter of the litigation. It explains that it filed the forfeiture case in order to examine the legitimacy of respondents' acquisition of the properties, as well as to inquire into the whereabouts of the amount acquired by them illegally. Further, it seeks to recover the money deposited in the subject accounts, which are both allegedly ill-gotten and unexplained.
Petitioner's arguments deserve credence. There is compelling reason to hold that the subject accounts fall squarely within the statutory exceptions and may be subject to disclosure.
Regarding the first exception, this Court held in Gancayco that the phrase pertaining to the exception "upon order of a competent court in cases of bribery or dereliction of duty of public officials"[33] is not exclusive. In fact, similar cases, such as cases of unexplained wealth, may be considered as falling within the same exception. This Court's pronouncements are enlightening:
With regard to the claim that disclosure would be contrary to the policy making bank deposits confidential, it is enough to point out that while [S]ection 2 of Republic Act No. 1405 declares bank deposits to be "absolutely confidential," it nevertheless allows such disclosure in the following instances: (1) Upon written permission of the depositor; (2) In cases of impeachment; (3) Upon order of a competent court in cases of bribery or dereliction of duty of public officials; (4) In cases where the money deposited is the subject matter of the litigation. 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.[34] (Emphasis supplied)As the present proceedings on unexplained wealth are now encompassed within the exceptions of R.A. No. 1405, the court orders subject of this case clearly fall within the orders that would enable the examination of the respondents' bank accounts as contemplated in the first exception. Thus, it comes clear that this Court cannot sustain the RTC and the CA's theory that there was no court order authorizing the examination of the subject accounts. On the contrary, records prove that the RTC issued several subpoenas duces tecum and ad testificandum,[35] which required certain persons to testify in open court and present certain documents which pertain not only to the existence and identity of the subject accounts, but to the contents found therein. Interestingly, despite admitting them on formal offer, it ultimately refused to pass upon and consider the same. Given the existence and the propriety of the subpoenas, the evidence procured through the same should have been duly considered by the lower courts.
With respect to the second exception, this Court finds that the subject accounts themselves are the very "subject matter of litigation."
What constitutes the very subject matter of litigation pursuant to the exceptions in Section 2 of R.A. No. 1405 has been amply addressed in Union Bank of the Philippines v. Court of Appeals:[36]
Petitioner contends that the Court of Appeals confuses the "cause of action" with the "subject of the action." In Yusingco vs. Ong Hing Lian, petitioner points out, this Court distinguished the two concepts.Guided by the foregoing, it is plain that the subject accounts themselves are the very subject matter of the litigation, as the inquiry is directed at the whereabouts and recovery of the money that had allegedly been illegally acquired and now subject to forfeiture. While it may be argued that the subject matter of the action ought to be the amount sought to be forfeited and not the subject accounts per se, this Court in Mellon Bank, N.A. v. Judge Magsino[38] clarified that the exceptions under R.A. No. 1405 allows the disclosure of bank accounts or deposits where the allegedly illegally acquired money is deposited: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. vs. 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 so deposited was the very thing in dispute. x x x[37] (Emphases supplied; citations omitted)
Private respondents' protestations that to allow the questioned testimonies to remain on record would be in violation of the provisions of Republic Act No. 1405 on the secrecy of bank deposits, is unfounded. Section 2 of said law 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.[39] (Emphases supplied; citations omitted)This Court hastens to add that the allowance of such an inquiry similarly extends to the bank accounts not only of the public official, but also to their spouse and other dependents. Therefore, the subject accounts of Rabusa and Ma. Debbie may be subject to disclosure. Such pervasiveness of the inquiry is clearly warranted, if only to prevent persons in government who illegally acquire property from evading investigation by simply placing property in the possession of or in the name of other persons. This is consistent with the directive of Section 8 of Republic Act No. 3019,[40] as amended:
Section 8. Prima facie evidence of and dismissal due to unexplained wealth. – If in accordance with the provisions of Republic Act Numbered One thousand three hundred seventy-nine, a public official has been found to have acquired during his incumbency, whether in his name or in the name of other persons, an amount of property and/or money manifestly out of proportion to his salary and to his other lawful income, that fact shall be a ground for dismissal or removal. Properties in the name of the spouse and dependents of such public official may be taken into consideration, when their acquisition through legitimate means cannot be satisfactorily shown. Bank deposits in the name of or manifestly excessive expenditures incurred by the public official, his spouse or any of their dependents including but not limited to activities in any club or association or any ostentatious display of wealth including frequent travel abroad of a non-official character by any public official when such activities entail expenses evidently out of proportion to legitimate income, shall likewise be taken into consideration in the enforcement of this section, notwithstanding any provision of law to the contrary. The circumstances hereinabove mentioned shall constitute valid ground for the administrative suspension of the public official concerned for an indefinite period until the investigation wealth is completed.[41]Indeed, the circumstances of this case ineluctably fall within the scope of the exceptions under R.A. No. 1405. Consonant thereto, this Court cannot agree with the CA's supposition that the examination of the respondents' bank accounts was but a mere fishing expedition to pin liability on them.[42]
The ruling in BSB Group, Inc. v. Go[43] further sustains this conclusion. In this case, respondent, who was employed by petitioner as cashier, was charged with qualified theft for allegedly taking the checks of petitioner's customers and depositing the same into her personal account instead of being turned over to the company's coffers. On the premise that respondent had encashed customers' checks and deposited the corresponding amounts thereof to her personal account, the prosecution moved for the issuance of subpoenas duces tecum and ad testificandum against the respective managers or records custodians of respondent's banks. In finding the evidence adduced by the respective subpoenas inadmissible, this Court ruled that they were deemed irrelevant as they pertained to the contents of the accounts where respondent had deposited the proceeds of the misappropriated checks, and not the amounts she had taken in line with her prosecution for qualified theft of cash. Elsewise stated, the evidence procured from the subpoenas were deemed inadmissible for irrelevance as the accounts sought to be examined had no relation to the criminal charges filed against respondent for qualified theft of cash:
What indeed constitutes the subject matter in litigation in relation to Section 2 of R.A. No. 1405 has been pointedly and amply addressed in Union Bank of the Philippines v. Court of Appeals, in which the Court noted that the inquiry into bank deposits allowable under R.A. No. 1405 must be premised on the fact that the money deposited in the account is itself the subject of the action. Given this perspective, we deduce that the subject matter of the action in the case at bar is to be determined from the indictment that charges respondent with the offense, and not from the evidence sought by the prosecution to be admitted into the records. In the criminal Information filed with the trial court, respondent, unqualifiedly and in plain language, is charged with qualified theft by abusing petitioner's trust and confidence and stealing cash in the amount of P1,534,135.50. The said Information makes no factual allegation that in some material way involves the checks subject of the testimonial and documentary evidence sought to be suppressed. Neither do the allegations in said Information make mention of the supposed bank account in which the funds represented by the checks have allegedly been kept.Prescinding therefrom, it cannot be denied that the inquiry into the subject accounts of respondents have a direct correlation to the subject matter of this case. Operatively, this would allow the disclosure of the subject accounts pursuant to the exceptions under R.A. No. 1405. As astutely pointed out by Senior Associate Justice Marvic M.V.F. Leonen, "it is when the inquiry has no relation to the subject matter of a pending case, or to the type of cases recognized as exceptions by Section 2 of Republic Act No. 1405, that the secrecy of bank deposits must be upheld. Otherwise, a similar inquiry would fall within the scope of Republic Act No. 1405, Section 2's exceptions."[45]
In other words, it can hardly be inferred from the indictment itself that the Security Bank account is the ostensible subject of the prosecution's inquiry. Without needlessly expanding the scope of what is plainly alleged in the Information, the subject matter of the action in this case is the money amounting to P1,534,135.50 alleged to have been stolen by respondent, and not the money equivalent of the checks which are sought to be admitted in evidence. Thus, it is that, which the prosecution is bound to prove with its evidence, and no other.
It comes clear that the admission of testimonial and documentary evidence relative to respondent's Security Bank account serves no other purpose than to establish the existence of such account, its nature and the amount kept in it. It constitutes an attempt by the prosecution at an impermissible inquiry into a bank deposit account the privacy and confidentiality of which is protected by law. On this score alone, the objection posed by respondent in her motion to suppress should have indeed put an end to the controversy at the very first instance it was raised before the trial court.[44] (Emphases supplied)
The respondents' foreign currency deposit accounts, however, face a different fate. Uncontroverted by respondents are their four foreign currency deposit accounts, namely:
It is beyond cavil that for foreign currency deposits, such as the US dollar deposits in this case, the applicable law is R.A. No. 6426, or the "Foreign Currency Deposit Act of the Philippines," and not R.A. No. 1405, as affirmed in Intengan v. Court of Appeals.[46] Designed to encourage foreign lenders and investors, the lone exception to the nondisclosure of foreign currency deposits under R.A. No. 6426 is disclosure upon the written permission of the depositor.[47] Section 8 of the law is categorical and subject to no other interpretation:
Section 8. Secrecy of foreign currency deposits. – All foreign currency deposits authorized under this Act, as amended by Presidential Decree No. 1035, as well as foreign currency deposits authorized under Presidential Decree No. 1034, are hereby declared as and considered of an absolutely confidential nature and, except upon the written permission of the depositor, in no instance shall foreign currency deposits be examined, inquired or looked into by any person, government official, bureau or office whether judicial or administrative or legislative, or any other entity whether public or private; Provided, however, that said foreign currency deposits shall be exempt from attachment, garnishment, or any other order or process of any court, legislative body, government agency or any administrative body whatsoever.[48]Glaringly, no such written permission was ever issued by Rabusa and Ma. Debbie consenting to the disclosure of the said foreign currency bank accounts. Therefore, applying Section 8 of R.A. No. 6426, Security Bank cannot be legally compelled to disclose the bank deposits of respondents; otherwise, it may unwittingly expose itself to criminal liability under the same act.
The CA did not err in concurring with the
RTC that (a) deposits in the AFPSLAI
accounts do not solely belong to respondents;
and (b) premium payments for the Philam
Insurance Policies were sourced from
monetary gifts.
Pertinent in this case are the ownership of the amounts deposited in the AFPSLAI accounts, as well as the source of payment of the Philam Insurance Policies in favor of Rabusa and Ma. Debbie's daughters, Diana and Dorothy Grace Rabusa.
Petitioner argues that other than the self-serving statements in the affidavits of respondent Rabusa and Ma. Debbie's friends and relatives, no concrete evidence was presented by the latter to substantiate their claim that the questioned money did indeed belong to the alleged investors, namely, Menandro Santos, Myrna Dimaano, Sheffered Tan, and Damian Mercado.[49] While they had submitted affidavits, petitioner insists that they failed to specifically state the amount of their investments; neither did they proffer any documentary evidence as proof of such arrangement. To add, petitioner maintains that there was no clear proof that the premium payments relative to the Philam Insurance Policies in favor of Diana and Dorothy Grace Rabusa were paid out from the monetary gifts given by Corazon Pitcock.
Juxtaposing the specific allegations in the petition with petitioner's documentary and testimonial evidence and as against the respondents' documentary and testimonial evidence, this Court agrees with the RTC and the CA that the weight of evidence fails to preponderate in petitioner's favor.
In the present case, it appears that aside from presenting the affidavits of Menandro Santos, Myrna Dimaano, Shefferd Tan, and Damian Mercado disclosing their request to deposit certain amounts to the accounts of Rabusa and Ma. Debbie in order to take advantage of the special interest rate, they were likewise presented to testify in open court during the proceedings in the RTC.[50] Contrary to petitioner's asseveration, respondents stipulated the respective amounts given by the depositors to wit:
To further fortify respondents' claim, Yolanda Bulanadi, head of the Capital and Savings Account of AFPSLAI, also testified that the common practice of investing other persons' money to avail of the 20% interest rate was indeed sanctioned and permitted by the AFPSLAI.[52]Mr. Damian Mercado contributed P3 million
Mr. Menandro Santos gave P2.7 million
Mr. Shefferd Tan contributed P1.5 million
Mrs. Myrna Dimaano contributed P1.5 million
Parents-in-law likewise gave P500,000.00[51]
With regard to the Philam Insurance Policies, this Court cannot ignore that respondents presented Corazon Pitcock as a witness, who testified in open court that she had indeed made certain monetary gifts on various occasions as godparent to Rabusa and Ma. Debbie when they were married.[53] Nominally, no shred of evidence was presented by petitioner to corroborate its claims that such monetary gifts given by Corazon Pitcock were not used towards the payment of the Philam insurance policies.
Towards this end, this Court finds no error in the trial courts' appreciation of the credibility of respondents' witnesses. Nothing on record appears to have been overlooked or misconstrued. Necessarily, the long-settled rule as iterated in People v. Edaño[54] is apropos:
x x x The rule is well established that an impartial tribunal, which has heard and observed a witness testify, is better fitted to pass upon the witness' credibility. The credibility of witnesses is a matter that the trial court has unequaled competence to consider and decide since it has the opportunity to observe the demeanor of the witnesses on the stand, an opportunity not afforded to the appellate courts; and the findings of the trial court as to the credibility of witnesses as a rule should not be disturbed, and is entitled to great weight, unless there appears in the record some fact or circumstance of weight and influence which has been overlooked by the trial court, or the significance of which has been misconstrued. x x x[55]For argument's sake, neither can Rabusa and his family's foreign travels be considered as convincing proof of unexplained wealth. Rabusa's travel records from no less than the General Headquarters of the AFP, prove that such travels were considered official. As conclusively found by the RTC, "[R]abusa and the other officers whom he travelled with were afforded international economy class airfare, representation allowance, reimbursable hotel accommodation, daily food allowance, clothing allowance and pre-departure expenses, which were all chargeable against the AFP Budget Appropriations and was subjected to accounting and auditing requirements."[56] Regrettably, petitioner failed to controvert or rebut such factual findings. In fact, the travel records[57] presented by petitioner failed to indicate which of Rabusa's trips were official and which were not.
Similarly, a reliance on Ma. Debbie's travel records,[58] as well as those of daughters Diana and Dorothy Grace,[59] does not necessarily prove the existence of unexplained wealth. As culled from the records of the Bureau of Investigation (BI), an examination thereof could only establish the details of such trips, such as the dates of departure and arrival, the destination, as well as the frequency of travel.
It is quite a stretch to conclude from the evidence presented that the foreign trips taken by Rabusa and his family were beyond their financial capacity, especially since no effort was exerted by petitioner to even determine the exact costs of these frequent trips. In Pleyto v. Philippine National Police Criminal Investigation and Detection Group,[60] this Court cautioned that the "frequency of foreign travel, by itself, is not proof of unexplained wealth of a public official or employee."[61] As already concluded by this Court, Rabusa had other sources of funds apart from his salary as a public official. Likewise settled is the fact that Ma. Debbie was also earning substantial income from her gainful employment at Art Net Café and Tri-Alpha, not to mention her partial inheritance she received from her father.
To further disparage petitioner's arguments, Rabusa cannot be expected to declare the house and lot located in Sto. Tomas, Batangas in his SALN, for the simple reason that such property belonged and was registered under the name of his father-in-law, Felix. Neither was there any showing that Felix was a co-conspirator or a mere conduit in an attempt to conceal the true value of Rabusa's wealth. Plainly, the need for public officials to declare assets in their SALNs does not extend to those registered and owned by other persons. To reiterate, the burden is upon the petitioner to establish that the property in question are actually owned by Rabusa, and prove that the cost is beyond his financial capacity. Unfortunately, petitioner fell short in this regard.
The quantum of evidence required
for forfeiture proceedings under
R.A. No. 1379 is preponderance of
evidence. Thus, the RTC should
have considered evidence from
respondents' subject accounts.
Necessarily, a remand of the case to
the RTC is proper.
To recall, this case is one involving the forfeiture of assets and properties that have been illegally acquired or misappropriated, pursuant to R.A. No. 1379. More particularly, the law provides for the procedure by which forfeiture proceedings may be instituted against public officers or employees who "[have] acquired during his [or her] incumbency an amount of property which is manifestly out of proportion to his [or her] salary as such public officer or employee and to his [or her] other lawful income and the income from legitimately acquired property, [which] property shall be presumed prima facie to have been unlawfully acquired."[62]
In Garcia v. Sandiganbayan, et al.,[63] this Court re-affirmed the principle that forfeiture proceedings under R.A. No. 1379 are civil in nature. In an earlier case,[64] this Court confirmed:
A study of the provisions of Republic Act No. 1379 readily discloses that the proceeding for forfeiture is civil in nature and not criminal, as claimed by the petitioners. A test has been suggested to determine whether the proceeding for forfeiture is civil or criminal, thus:Connectedly, the quantum of evidence required for forfeiture proceedings under this law are the same with other civil cases–preponderance of evidence.[66] Section 1, Rule 133 of the Rules of Court is instructive as to how preponderance of evidence is determined:"... 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." (37 CJS, Forfeiture, Sec. 5. pp. 15-16)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. Had it been a criminal proceeding there would have been, after a preliminary investigation, a reading of information, a plea of guilty or not guilty, and a trial thereafter, with the publication of the judgment in the presence of the defendant. But these proceedings as above set forth, are not provided for in the law.[65] (Citations and emphasis omitted)
Section 1. Preponderance of evidence, how determined. – In civil cases, the party having the burden of proof must establish his case by a preponderance of evidence. In determining where the preponderance or superior weight of evidence on the issues involved lies, the court may consider all the facts and circumstances of the case, the witnesses manner of testifying, their intelligence, their means and opportunity of knowing the facts to which they are testifying, the nature of the facts to which they testify, the probability or improbability of their testimony, their interest or want of interest, and also their personal credibility so far as the same may legitimately appear upon the trial. The court may also consider the number of witnesses, though the preponderance is not necessarily with the greater number.[67]Expounding on the concept of preponderance of evidence, this Court held:
x x x "Preponderance of evidence" is the weight, credit, and value of the aggregate evidence on either side and is usually considered to be synonymous with the term greater weight of the evidence or greater weight of the credible evidence. Preponderance of evidence is a phrase which, in the last analysis, means probability of the truth. It is evidence which is more convincing to the court as worthy of belief than that which is offered in opposition thereto.[68]Conformably, it is incumbent upon petitioner to prove the allegations in its complaint. It is, therefore, imperative that the operative act on how and in what manner the respondents participated in amassing ill-gotten wealth be demonstrated through preponderance of evidence. In case of failure to do so, petitioner's complaint would merit nothing but denial.[69]
Ultimately, this Court finds that the RTC and the CA validly considered and weighed the evidence regarding respondents' other assets and expenses, namely, the AFPSLAI accounts, the insurance policies, the respondents and their family's travel history, as well as the property belonging to Rabusa's father-in-law, Felix. As painstakingly discussed, Rabusa adequately justified such discrepancies, even readily admitting to his wife's financial capacity and all their recent transactions, which would belie any malicious intent to conceal or to commit any dishonesty to the public.
Nevertheless, the RTC would have more basis on disposing the case based on a preponderance of evidence if it had taken into consideration the evidence adduced from the respondents' subject accounts. As observed by Senior Associate Justice Leonen, the combined contents of such accounts total to over P10,000,000.00.[70]
As a final point, this Court recognizes the difficulty in prosecuting a case for corruption, especially when it involves recovering what rightfully belongs to the government and the Republic from the hands of no less than a public official. While petitioner must be commended for its efforts to hold Rabusa accountable for his alleged unexplained wealth and unlawfully acquired properties, it must concede to the judiciary to make a just and complete disposition of the case by adhering to the standards of evidence carved out especially for cases under R.A. No. 1379.
Consequently, a full-blown hearing on the merits is required, including the reception of additional evidence, if needed, from both parties. This Court enjoins the lower court to take on this responsibility in order to meaningfully uphold the rule that public office is a public trust, as this Court is barred from reviewing factual matters.
ACCORDINGLY, premises considered, the instant petition is PARTIALLY GRANTED. The Decision dated November 26, 2012 and the Resolution dated June 25, 2013 of the Court of Appeals in CA-G.R. CV No. 95545 are AFFIRMED with MODIFICATION. The case is REMANDED to the Regional Trial Court, Branch 59, Makati City for the purpose of reconsidering the evidence on the subject bank accounts of respondents.
SO ORDERED.
Lazaro-Javier, Zalameda,* and Kho, Jr., JJ., concur.
Leonen, SAJ. (Chairperson), see separate concurring opinion.
* Designated additional member in lieu of Associate Justice Mario V. Lopez, per Raffle dated March 28, 2022.
[1] Republic of the Philippines v. Cuenca, et al., 829 Phil. 139, 173 (2018) [Per J. Tijam, First Division].
[2] Rollo, pp. 11-43.
[3] Penned by Associate Justice Socorro B. Inting (now a member of this Court), with Associate Justices Jose C. Reyes, Jr. (a retired member of this Court) and Mario V. Lopez (now a member of this Court), concurring; id. at 45-54.
[4] Id. at 56-57.
[5] Penned by Judge Winlove M. Dumayas; id. at 262-269.
[6] Rollo, pp. 58-88.
[7] Id. at 61.
[8] Id. at 89-135.
[9] Id. at 63.
[10] Id. at 64-73.
[11] Id. at 149-180.
[12] Id. at 70-73; 156-163.
[13] Id. at 73-74.
[14] Id. at 46-47.
[15] Id. at 47.
[16] Id. at 262-269.
[17] Id. at 269.
[18] Id. at 272-273.
[19] See Appellant's Brief; id. at 182-183.
[20] Rollo, pp. 45-54.
[21] Id. at 53.
[22] Id. at 56-57.
[23] Id. at 326-338.
[24] Id. at 369-382.
[25] Id. at 25.
[26] 472 Phil. 11 (2004) [Per J. Austria-Martinez, Second Division].
[27] Id. at 23.
[28] R.A. NO. 1405, SEC. 2.
[29] Id.
[30] Presidential Decree No. 1972, as amended by R.A. No. 7653; R.A. No. 3019; R.A. No. 9160.
[31] Mendoza v. Court of Appeals, 802 Phil. 314, 352 (2016) [Per J. Perez, En Banc].
[32] 122 Phil. 503, 508 (1965) [Per J. Regala, En Banc].
[33] Philippine National Bank v. Gancayco, supra.
[34] Id. at 507-508.
[35] Rollo, pp. 226-261.
[36] 378 Phil. 1177 (1999) [Per J. Kapunan, First Division].
[37] Id. at 1182-1183.
[38] 268 Phil. 697 (1990) [Per C.J. Fernan, Third Division].
[39] Id. at 713.
[40] Entitled "Anti-Graft and Corrupt Practices Act."
[41] As amended by BP Blg. 195, March 16, 1982.
[42] Rollo, p. 51.
[43] 626 Phil. 501 (2010) [Per J. Peralta, Third Division].
[44] Id. at 516-517.
[45] See Separate Concurring Opinion, p. 5.
[46] 427 Phil. 293, 304 (2002) [Per J. De Leon, Jr., Second Division].
[47] R.A. NO. 6426, SEC. 8.
[48] As amended by PD No. 1035, and further amended by PD No. 1246, promulgated Nov. 21, 1977.
[49] Rollo, pp. 339-342.
[50] See RTC Decision; id. at 266.
[51] Rollo, p. 335.
[52] Id. at 266.
[53] See RTC Decision; id. at 267.
[54] 159-A Phil. 934 (1975) [Per J. Antonio, Second Division].
[55] Id. at 939-940.
[56] Rollo, p. 266.
[57] Id. at 156-157.
[58] Id. at 151-153.
[59] Id. at 158-161.
[60] 563 Phil. 842 (2007) [Per J. Chico-Nazario, Third Division].
[61] Id. at 896.
[62] R.A. NO. 1379, SEC. 2.
[63] 618 Phil. 346, 361 (2009) [Per J. Velasco, Jr., Third Division].
[64] Almeda v. Hon. Perez, 116 Phil. 120 (1962) [Per J. Labrador, En Banc].
[65] Id. at 125-126.
[66] Republic of the Philippines v. Gimenez, 776 Phil. 233, 252 (2016) [Per J. Leonen, Second Division].
[67] RULES OF COURT, RULE 133, SEC. 1.
[68] Encinas v. National Bookstore, Inc., 485 Phil. 683, 695 (2004) [Per J. Tinga, Second Division].
[69] Republic of the Philippines v. Cuenca, et al., supra note 1, at 173.
[70] See Separate Concurring Opinion, p. 8.
LEONEN, SAJ.:
I concur. The ponencia's application of Republic Act No. 1405 and its relevant exceptions correctly distinguishes between when the secrecy of bank deposits may or may not be maintained by the courts.
This involves a Petition for Forfeiture of Unlawfully Acquired Properties filed by the Office of the Ombudsman against Lt. Col. George A. Rabusa (Rabusa), whose Statements of Assets, Liabilities and Net Worth from 1990 to 2003 revealed a significant discrepancy between his and his wife's income and their family's reported expenses.[1] The Ombudsman investigated Rabusa's properties and discovered undeclared asset and expense items, which included "subscribed and paid-up capital shares" in his and his wife's names, vehicles registered in Rabusa's name, "capital contributions and savings" in the Armed Forces and Police Savings and Loan Association, Inc., bank deposits of both local and foreign currency in several financial institutions, a house and lot in Batangas, travel expenses to foreign countries, and the payment of insurance premiums for his two daughters.[2]
In total, the Ombudsman found assets amounting to PHP 43,096,081.90, which it deemed "manifestly out of proportion to Rabusa's declared salary and other lawful income."[3]
The Regional Trial Court dismissed the Petition after finding that the Republic failed to adduce a preponderance of evidence proving that Rabusa illegally accumulated his wealth.[4] Instead, the trial court agreed with Rabusa's arguments: (1) that his family's expenses were "reasonably augmented" by his wife's inheritance and accumulated donations from her father, and by her earnings from her own work; (2) that he sold one of his properties and took out a loan to sustain their expenses; and (3) that the funds in his Armed Forces of the Philippines Savings and Loan Association, Inc., account were a mix of his and his relatives' money, which sought to take advantage of the high interest rates offered to Association members.[5]
The Republic appealed the Regional Trial Court's Decision, arguing that the evidence proving the existence and contents of Rabusa's bank accounts should not have been declared inadmissible because "the money in the subject bank accounts [was] the subject of litigation[.]" Thus, the Republic's evidence fell within the exception to the rule prohibiting inquiry into bank accounts. The Republic further contested the trial court's acceptance of Rabusa's claims that the contents of the Armed Forces and Police Savings and Loan Association, Inc. accounts were composed of both his and his relatives' funds, and that the amounts paid for his daughters' insurance premiums came from the donations of one Corazon Pitcock.[6]
However, the Court of Appeals denied the prayer for forfeiture, holding that Republic Act. No. 1405 protected Rabusa's bank accounts from inquiries that amounted to "a fishing expedition."[7] Since Republic Act No. 1405 provides for a legitimate expectation of privacy in a person's bank accounts, the general rule of absolute secrecy should be upheld in the absence of any exceptions and consistent with the "present legal order" of avoiding an interpretation of these exceptions as authorizing "unbridled discretion . . . for unwarranted inquiry into bank accounts."[8] Likewise, the Court of Appeals affirmed the trial court's factual findings on the source of the funds deposited in the Armed Forces and Police Savings and Loan Association, Inc. accounts, and those used to pay for the insurance policies of Rabusa's daughters. It maintained that the trial court was in the best position to weigh the evidence and ascertain the credibility of the witnesses presented.[9]
After the denial of its subsequent Motion for Reconsideration, the Republic assailed the Court of Appeals Decision through a Petition for Review on Certiorari. The Republic argued once more on the issue of whether it was proper for the lower courts to disregard the evidence adduced on Rabusa's bank accounts, despite the situation allegedly calling for the application of an exception to the law on secrecy of bank deposits.[10]
As correctly held by the ponencia, the Court of Appeals' discussion on the rule on secrecy of bank deposits failed to apply the available exceptions. I concur with the ponencia's interpretation of the cases cited as part of the appellate court's rationale for denying the prayer for forfeiture.
The Court of Appeals upheld the "basic state policy" of bank deposit confidentiality by citing Section 2 of Republic Act No. 1405.[11] However, the same provision provides that a court order to examine these deposits (1) in cases of "bribery and dereliction of duty" of public officers, or (2) when the money in the account is "the subject matter of litigation," are both exceptions to the "absolute confidentiality" of bank deposits.
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 supplied)The ponencia correctly discusses that Philippine National Bank v. Gancayco recognized that Section 8 of Republic Act No. 3019, as amended, includes cases of unexplained wealth as an additional exception to those provided by Section 2,[12] because the former is equivalent to a case of bribery and dereliction of duty:[13]
With regard to the claim that disclosure would he contrary to the policy making bank deposits confidential, it is enough to point out that while section 2 of Republic Act No. 1405 declares bank deposits to be "absolutely confidential" it nevertheless allows such disclosure in the following instances: (1) Upon written permission of the depositor; (2) In cases of impeachment; (3) Upon order of a competent court in cases of bribery or dereliction of duty of public officials; (4) In cases where the money deposited is the subject of the litigation. 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.[14] (Emphasis supplied)Here, however, despite the Regional Trial Court's issuance of subpoenas duces tecum and ad testificandum authorizing the bank accounts' examination,[15] and the issue of illegally acquired properties pertaining to the contents of the same accounts, neither of the lower courts considered the evidence so adduced, so as to amount to an exception to Republic Act No. 1405, Section 2.
Instead, the Court of Appeals emphasized the existence of a "basic state policy" of considering "absolutely confidential all deposits of whatever nature[,] with banks and other financial institutions[.]"[16] In support of this premise, the Court of Appeals referenced BSB Group, Inc. v. Sally Go, which prohibited the disclosure of bank account details in line with an "unwarranted inquiry or investigation."[17]
The Court of Appeals failed to fully appreciate the ruling in BSB Group, Inc. v. Sally Go. There, the evidence adduced through subpoenas duces tecum and ad testificandum were deemed irrelevant because they pertained to the contents of the accounts where Sally Go deposited the proceeds of misappropriated checks. However, Sally Go's ongoing criminal prosecution charged her with qualified theft of cash. The disclosure of information ordered by the subpoenas was, therefore, deemed "unwarranted," and the evidence procured were deemed inadmissible for irrelevance, because the accounts examined had no relation to the criminal charges for qualified theft of cash.
What indeed constitutes the subject matter in litigation in relation to Section 2 of R.A. No. 1405 has been pointedly and amply addressed in Union Bank of the Philippines v. Court of Appeals, in which the Court noted that the inquiry into bank deposits allowable under R.A. No. 1405 must be premised on the fact that the money deposited in the account is itself the subject of the action. Given this perspective, we deduce that the subject matter of the action in the case at bar is to be determined from the indictment that charges respondent with the offense, and not from the evidence sought by the prosecution to be admitted into the records. In the criminal Information filed with the trial court, respondent, unqualifiedly and in plain language, is charged with qualified theft by abusing petitioner's trust and confidence and stealing cash in the amount of P1,534,135.50. The said Information makes no factual allegation that in some material way involves the checks subject of the testimonial and documentary evidence sought to be suppressed. Neither do the allegations in said Information make mention of the supposed bank account in which the funds represented by the checks have allegedly been kept.Thus, BSB Group, Inc. v. Sally Go's discussion should not be read to mean that an inquiry into "the existence of [an] account, its nature and the amount kept in it" is an unwarranted inquiry per se. It is when the inquiry has no relation to the subject matter of a pending case, or to the types of cases recognized as exceptions by Section 2 of Republic Act No. 1405, that the secrecy of bank deposits must be upheld. Otherwise, a similar inquiry would fall within the scope of Republic Act No. 1405, Section 2's exceptions.[19]
In other words, it can hardly be inferred from the indictment itself that the Security Bank account is the ostensible subject of the prosecution's inquiry. Without needlessly expanding the scope of what is plainly alleged in the Information, the subject matter of the action in this case is the money amounting to P1,534,135.50 alleged to have been stolen by respondent, and not the money equivalent of the checks which are sought to be admitted in evidence. Thus, it is that, which the prosecution is bound to prove with its evidence, and no other.
It comes clear that the admission of testimonial and documentary evidence relative to respondent's Security Bank account serves no other purpose than to establish the existence of such account, its nature and the amount kept in it. It constitutes an attempt by the prosecution at an impermissible inquiry into a bank deposit account the privacy and confidentiality of which is protected by law. On this score alone, the objection posed by respondent in her motion to suppress should have indeed put an end to the controversy at the very first instance it was raised before the trial court.[18] (Citations omitted; emphasis supplied)
Further, BSB Group, Inc. v. Sally Go involved the criminal prosecution of a person in her private capacity, which allowed this Court to discuss how the "right of privacy extends its scope to include an individual's financial privacy rights and personal financial matters[.]"[20]
A final note. In any given jurisdiction where the right of privacy extends its scope to include an individual's financial privacy rights and personal financial matters, there is an intermediate or heightened scrutiny given by courts and legislators to laws infringing such rights. Should there be doubts in upholding the absolutely confidential nature of bank deposits against affirming the authority to inquire into such accounts, then such doubts must be resolved in favor of the former. This attitude persists unless congress lifts its finger to reverse the general state policy respecting the absolutely confidential nature of bank deposits.[21] (Citations omitted; emphasis supplied)Respondents cannot claim a similar right to privacy in their bank accounts, as the pending investigation for illegally acquired properties pertains to those acquired by Rabusa during his service as a public officer. This Court's discussion in Philippine National Bank v. Gancayco, that any person who discharges the duties of a public office "does so with full knowledge that his life, so far as relevant to his duty, is open to public scrutiny[,]" is, therefore, more on point and defines more clearly the limit of "financial privacy rights," as it applies to public officers.[22]
In further contrast, when the inquiry is directed at the whereabouts and recovery of the very same money that had allegedly been illegally acquired, then the deposits were deemed the subject matter of the litigation – an exception under Section 2 of Republic Act No. 1405 subject to disclosure. In Mellon Bank, N.A. v. Magsino:[23]
Private respondents' protestations that to allow the questioned testimonies to remain on record would be in violation of the provisions of Republic Act No. 1405 on the secrecy of bank deposits, is unfounded. Section 2 of said law 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.[24] (Emphasis supplied)The allowance of the inquiry also extends to the bank accounts not only of the public official, but also their spouse and any dependents, pursuant to Section 8 of Republic Act No. 3019, as amended.
SECTION 8. Prima facie evidence of and dismissal due to unexplained wealth. – If in accordance with the provisions of Republic Act Numbered One thousand three hundred seventy-nine, a public official has been found to have acquired during his incumbency, whether in his name or in the name of other persons, an amount of property and/or money manifestly out of proportion to his salary and to his other lawful income, that fact shall be a ground for dismissal or removal. Properties in the name of the spouse and dependents of such public official may be taken into consideration, when their acquisition through legitimate means cannot be satisfactorily shown. Bank deposits in the name of or manifestly excessive expenditures incurred by the public official, his spouse or any of their dependents including but not limited to activities in any club or association or any ostentatious display of wealth including frequent travel abroad of a non-official character by any public official when such activities entail expenses evidently out of proportion to legitimate income, shall likewise be taken into consideration in the enforcement of this section, notwithstanding any provision of law to the contrary. The circumstances hereinabove mentioned shall constitute a valid ground for the administrative suspension of the public official concerned for an indefinite period until the investigation wealth is completed.Thus, here, the subpoenas for respondents' bank account details were proper in support of the Petition for Forfeiture of Illegally Acquired Properties, and the evidence procured through the subpoenas should have been duly considered by the lower courts.
This is consistent with this Court's ruling in Ejercito v. Sandiganbayan,[25] where we not only clarified the applicability of the "court order" and "subject matter" exceptions to Republic Act No. 1405, Section 2, but also emphasized the absence of an exclusionary rule for evidence procured in supposed violation of the same law.
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:Consistent with this Court's ruling in Ejercito v. Sandiganbayan, that information obtained in violation of Republic Act No. 1405 is still admissible in evidence – as the law imposes only a penalty on the offender and does not impose an exclusionary rule on such evidence – the lower courts should not have disregarded the Republic's evidence on Rabusa's bank accounts. The same absence of an exclusionary rule should have also applied to the evidence of Rabusa's foreign currency deposits, notwithstanding the impropriety of their disclosure without consent from the depositor.
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.[26] (Emphasis supplied)
I agree that the lower courts may have validly considered and weighed the evidence regarding respondents' other assets and expenses, such as the Armed Forces and Police Savings and Loan Association, Inc. accounts, foreign travel expenses, and insurance premiums. However, a proceeding for forfeiture of illegally acquired wealth turns on a preponderance of evidence and the lower courts seriously erred in refusing to consider the evidence on respondents' bank accounts despite their production, consistent with the exceptions to the rule on secrecy of bank deposits. The records provide that the Regional Trial Court itself ordered the production of the very same evidence on respondents' bank accounts, which the court eventually admitted on formal offer but subsequently refused to consider.[27]
Had the evidence on Rabusa's bank accounts been given due consideration, the lower courts would have had more basis upon which to decide the Petition for Forfeiture of Unlawfully Acquired Properties. The contents of respondents' bank accounts total to over PHP 10,000,000.00,[28] which deserves proper evaluation for a just and complete disposition of this case. Thus, I opine that the proceedings may benefit from a full hearing on the merits, consistent with giving meaning to the long-settled rule that public office is a public trust. The trial courts must bear this responsibility, as this Court cannot review questions of fact that require the re-examination of evidence.
ACCORDINGLY, I vote to PARTIALLY GRANT the Petition and to admit into evidence the proof of the bank accounts belonging to respondents Lt. Col. George Abonito Rabusa and Ma. Debbie Arevalo Rabusa.
I further vote to REMAND the case to the Regional Trial Court for reconsideration of the evidence on respondents' bank accounts.
[1] Ponencia, p 2.
[2] Id. at 3-5.
[3] Id. at 6.
[4] Id.; Rollo, at 262-269. The Decision, promulgated on December 14, 2009 and docketed as Civil Case no. 04-1321, was penned by Presiding Judge Winlove M. Dumayas of Regional Trial Court Branch 59, Makati City.
[5] Ponencia, p. 6.
[6] Id. at 7.
[7] Id.; Rollo, pp. 45-54. The Decision, promulgated on November 26, 2012 and docketed as CA-G.R. CV No. 95545, was penned by Associate Justice Socorro B. Inting, with the concurrence of Associate Justices Jose C. Reyes, Jr. and Mario V. Lopez (now a member of this Court), of the Court of Appeals' Ninth Division, Manila.
[8] Rollo, p. 50.
[9] Id. at 53.
[10] Ponencia, p. 7.
[11] Rollo, pp. 49-50.
[12] Republic Act No. 1405, sec. 2 states:
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.
[13] Ponencia, p. 11.
[14] Philippine National Bank v. Gancayco, 122 Phil. 503, 508 (1965) [Per J. Regala, En Banc].
[15] Ponencia, p. 8, Rollo, pp. 17-21.
[16] Rollo, p. 50.
[17] Id. at 49-50.
[18] BSB Group, Inc. v. Sally Go, 626 Phil. 501, 516-517 (2010) [Per J. Peralta, Third Division].
[19] Id. at 517.
[20] Id.
[21] Id. at 517-518.
[22] Philippine National Bank v. Emilio Gancayco, 122 Phil. 503 (1965) [Per J. Regala, En Banc].
[23] 268 Phil. 697 (1990) [Per J. Fernan, Third Division].
[24] Id. at 713.
[25] 538 Phil. 684 (2006) [Per J. Carpio-Morales, En Banc].
[26] Id. at 725-726.
[27] Ponencia, p. 8; Rollo, pp. 17-21.
[28] Ponencia, p. 3.