654 Phil. 277; 107 OG No. 47, 5992 (November 21, 2011)
BERSAMIN, J.:
The threshold question to be resolved in the present case is whether or not the Office of the Ombudsman has jurisdiction over the herein petitioner.
It is therefore of paramount importance to consider the definitions of the following basic terms, to wit: A public office "is the right, authority and duty, created and conferred by law, by which for a given period, either fixed by law or enduring at the pleasure of the creating power, an individual is invested with some portion of the sovereign functions of the state to be exercised by him for the benefit of the public." (San Andres, Catanduanes vs. Court of Appeals, 284 SCRA 276: Chapter I, Section 1, Mechem, A Treatise on Law of Public Offices and Officers). The individual so invested is called the public officer which "includes elective and appointive officials and employees, permanent or temporary, whether in the classified or unclassified or exemption service receiving compensation, even nominal, from the government as defined in xxx [Sec. 2 (a) of Republic Act No. 3019 as amended]." (Sec. 2 (b) of Republic Act No. 3019 as amended. Unless the powers conferred are of this nature, the individual is not a public officer.
With these time-honored definitions and the substantial findings of the Ombudsman, We are constrained to conclude that, indeed, the herein petitioner (Antonio M. Carandang) is a public officer. Precisely, since he (Antonio M. Carandang) was appointed by then President Joseph Ejercito Estrada as general manager and chief operating officer of RPN-9 (page 127 of the Rollo). As a presidential appointee, the petitioner derives his authority from the Philippine Government. It is luce clarius that the function of the herein petitioner (as a presidential appointee), relates to public duty, i.e., to represent the interest of the Philippine Government in RPN-9 and not purely personal matter, thus, the matter transcends the petitioner's personal pique or pride.x x x
Having declared earlier that the herein petitioner is a public officer, it follows therefore that, that jurisdiction over him is lodged in the Office of the Ombudsman.
It is worth remembering that as protector of the people, the Ombudsman has the power, function and duty to act promptly on complaints filed in any form or manner against officers or employees of the Government, or of any, subdivision, agency or instrumentality thereof, including government-owned or controlled corporations, and enforce their administrative, civil and criminal liability in every case where the evidence warrants in order to promote efficient service by the Government to the people. (Section 13 of Republic Act No. 6770).x x x
Accordingly, the Office of the Ombudsman is, therefore, clothed with the proper armor when it assumed jurisdiction over the case filed against the herein petitioner. x x xx x x
It appears that RPN-9 is a private corporation established to install, operate and manage radio broadcasting and/or television stations in the Philippines (pages 59-79 of the Rollo). On March 2, 1986, when RPN-9 was sequestered by the Government on ground that the same was considered as an illegally obtained property (page 3 of the Petition for Review; page 2 of the Respondent's Comment; pages 10 and 302 of the Rollo), RPN-9 has shed-off its private status. In other words, there can be no gainsaying that as of the date of its sequestration by the Government, RPN-9, while retaining its own corporate existence, became a government-owned or controlled corporation within the Constitutional precept.
Be it noted that a government-owned or controlled corporation "refers to any agency organized as a stock or non-stock corporation, vested with functions relating to public needs whether government or proprietary in nature, and owned by the Government directly or through its instrumentalities either wholly, or, where applicable as in the case of stock corporations, to the extent of at least fifty-one (51) percent of its capital stock; Provided, That government-owned or controlled corporations may be further categorized by the department of Budget, the Civil Service, and the Commission on Audit for purposes of the exercise and discharge of their respective powers, functions and responsibilities with respect to such corporations." (Section 2 [13], Executive Order No. 292).
Contrary to the claim of the petitioner, this Court is of the view and so holds that RPN-9 perfectly falls under the foregoing definition. For one, "the government's interest to RPN-9 amounts to 72.4% of RPN's capital stock with an uncontested portion of 32.4% and a contested or litigated portion of 40%." (page 3 of the Petition for Review; pages 8-9 of the Respondent's Comment). On this score, it ought to be pointed out that while the forty percent (40%) of the seventy two point four percent (72.4%) is still contested and litigated, until the matter becomes formally settled, the government, for all interests and purposes still has the right over said portion, for the law is on its side. Hence, We can safely say that for the moment, RPN-9 is a government owned and controlled corporation. Another thing, RPN 9, though predominantly tackles proprietary functions--those intended for private advantage and benefit, still, it is irrefutable that RPN-9 also performs governmental roles in the interest of health, safety and for the advancement of public good and welfare, affecting the public in general.x x x
Coming now to the last assignment of error- While it may be considered in substance that the "latest GIS clearly shows that petitioner was no longer a stockholder of record of AF Broadcasting Corporation at the time of his assumption of Office in RPN 9 x x x" (Petitioner's Reply [to Comment]; page 317 of the Rollo), still severing ties from AF Broadcasting Corporation does not convince this Court fully well to reverse the finding of the Ombudsman that Antonio Carandang "appears to be liable for Grave Misconduct" (page 10 of the Assailed Decision; page 36 of the Rollo). Note that, as a former stockholder of AF Broadcasting Corporation, it is improbable that the herein petitioner was completely oblivious of the developments therein and unaware of the contracts it (AF Broadcasting Corporation) entered into. By reason of his past (Antonio Carandang) association with the officers of the AF Broadcasting Corporation, it is unbelievable that herein petitioner could simply have ignored the contract entered into between RPN-9 and AF Broadcasting Corporation and not at all felt to reap the benefits thereof. Technically, it is true that herein petitioner did not directly act on behalf of AF Broadcasting Corporation, however, We doubt that he (herein petitioner) had no financial and/or material interest in that particular transaction requiring the approval of his office--a fact that could not have eluded Our attention.x x x
WHEREFORE, premises considered and pursuant to applicable laws and jurisprudence on the matter, the present Petition for Review is hereby DENIED for lack of merit. The assailed decision (dated January 26, 2000) of the Office of the Ombudsman in OMB-ADM-0-99-0349 is hereby AFFIRMED in toto. No pronouncement as to costs.
SO ORDERED.[15]
That sometime on September 8, 1998 or thereabouts, in Quezon City, Philippines and within the jurisdiction of this Honorable Court, accused ANTONIO M. CARANDANG, a high ranking officer (HRO) being then the General Manager of Radio Philippines Network, Inc. (RPN-9), then a government owned and controlled corporation, did then and there willfully, unlawfully and criminally give unwarranted benefits to On Target Media Concept, Inc. (OTMCI) through manifest partiality and gross inexcusable negligence and caused the government undue injury, by pre-terminating the existing block time contract between RPN 9 and OTMCI for the telecast of "Isumbong Mo Kay Tulfo" which assured the government an income of Sixty Four Thousand and Nine Pesos (P 64,009.00) per telecast and substituting the same with a more onerous co-production agreement without any prior study as to the profitability thereof, by which agreement RPN-9 assumed the additional obligation of taking part in the promotions, sales and proper marketing of the program, with the end result in that in a period of five (5) months RPN-9 was able to realize an income of only Seventy One Thousand One Hundred Eighty Five Pesos (P 71,185.00), and further, by waiving RPN-9's collectible from OTMCI for August 1-30, 1998 in the amount of Three Hundred Twenty Thousand and Forty Five Pesos (P 320,045.00).
Section 2. A government-owned or controlled corporation is a stock or a non-stock corporation, whether performing governmental or proprietary functions, which is directly chartered by a special law or if organized under the general corporation law is owned or controlled by the government directly, or indirectly through a parent corporation or subsidiary corporation, to the extent of at least a majority of its outstanding capital stock or of its outstanding voting capital stock.
Section 2. General Terms Defined. - Unless the specific words of the text or the context as a whole or a particular statute, shall require a different meaning:x x x
(13) government-owned or controlled corporations refer to any agency organized as a stock or non-stock corporation vested with functions relating to public needs whether governmental or proprietary in nature, and owned by the government directly or indirectly through its instrumentalities either wholly, or where applicable as in the case of stock corporations to the extent of at least 51% of its capital stock.
But these jurisprudential rules invoked by petitioner in support of his claim that the CIIF companies are government owned and/or controlled corporations are incomplete without resorting to the definition of "government owned or controlled corporation" contained in par. (13), Sec.2, Introductory Provisions of the Administrative Code of 1987, i.e., any agency organized as a stock or non-stock corporation vested with functions relating to public needs whether governmental or proprietary in nature, and owned by the government directly or indirectly through its instrumentalities either wholly, or where applicable as in the case of stock corporations to the extent of at least fifty-one (51) percent of its capital stock. The definition mentions three (3) requisites, namely, first, any agency organized as a stock or non-stock corporation; second, vested with functions relating to public needs whether governmental or proprietary in nature; and, third, owned by the Government directly or through its instrumentalities either wholly, or, where applicable as in the case of stock corporations, to the extent of at least fifty-one (51) of its capital stock.
In the present case, all three (3) corporations comprising the CIIF companies were organized as stock corporations. The UCPB-CIIF owns 44.10% of the shares of LEGASPI OIL, xxx. Obviously, the below 51% shares of stock in LEGASPI OIL removes this firm from the definition of a government owned or controlled corporation. x x x The Court thus concludes that the CIIF are, as found by public respondent, private corporations not within the scope of its jurisdiction.[28]
MR. EDGAR S. SAN LUIS
President & General Manager
Radio Philippines Network, Inc.
Broadcast City, Capitol Hills
Diliman, Quezon City
Sir:
This refers to your letter dated August 4, 1999, seeking "PCGG's position on the following:
"1. Whether RPN-9 is a GOCC x x x or a private corporation outside the scope of OGCC and COA's control given 32% Government ownership x x x.x x x
It appears that under the RP-Benedicto Compromise Agreement dated November 3, 1990 - validity of which has been sustained by the Supreme Court in G.R. No. 96087, March 31, 1992, (Guingona, Jr. vs. PCGG, 207 SCRA 659) - Benedicto ceded all his rights, interest and/or participation, if he has any, in RPN-9, among others, to the government which rights, interest and/or participation per PCGG's understanding, include 9,494,327.50 shares of stock, i.e, about 72.4% of the total issued and outstanding capital stock of RPN-9.
Accordingly, the Sandiganbayan (Second Division), on motion of the government through PCGG, ordered the president and corporate secretary of the RPN-9 to "effect the immediate cancellation and transfer of the 9,494,327.50 shares corresponding to Benedicto's proprietary interest in RPN-9 to the Republic of the Philippines c/o PCGG" (Sandiganbayan's Resolution of February 3, 1998 in Civil Case No. 0034, RP vs. Roberto Benedicto, et. al.) Benedicto, however, filed a motion for reconsideration of said Resolution, contending that the number of RPN-9 shares ceded by him embraces only his personal holdings and those of his immediate family and nominees totaling 4,161,207.5 shares but excluding the RPN-9 shares in the name of Far East Managers and Investors, Inc. ("FEMIE"), which is about 40%, as they are corporate properties/assets of FEMIE and not his personal holdings. Said motion for reconsideration is still pending resolution by the Sandiganbayan.x x x
We agree with your x x x view that RPN-9 is not a government owned or controlled corporation within the contemplation of the Administrative Code of 1987, for admittedly, RPN-9 was organized for private needs and profits, and not for public needs and was not specifically vested with functions relating to public needs.
Neither could RPN-9 be considered a "government-owned or controlled corporation" under Presidential Decree (PD) No. 2029 dated February 4, 1986, which defines said terms as follows:"Sec.2. Definition. - A government owned- or controlled corporation is a stock or non-stock corporation, whether performing governmental or proprietary functions which is directly chartered by special law or organized under the general corporation law is owned or controlled by the government directly, or indirectly through a parent corporation or subsidiary corporation, to the extent of at least a majority of its outstanding capital stock or of its outstanding voting capital stock;
Provided, that a corporation organized under the general corporation law under private ownership at least a majority of the shares of stock of which were conveyed to a government corporation in satisfaction of debts incurred with a government financial institution, whether by foreclosure or otherwise, or a subsidiary corporation of a government corporation organized exclusively to own and manage, or lease, or operate specific physical assets acquired by a government financial institution in satisfaction of debts incurred therewith, and which in any case by enunciated policy of the government is required to be disposed of to private ownership within a specified period of time, shall not be considered a government-owned or controlled corporation before such disposition and even if the ownership or control thereof is subsequently transferred to another government-owned or controlled corporation."
A government-owned or controlled corporation is either "parent" corporation, i.e., one "created by special law" (Sec. 3 (a), PD 2029) or a "subsidiary" corporation, i.e, one created pursuant to law where at least a majority of the outstanding voting capital stock of which is owned by parent government corporation and/or other government-owned subsidiaries. (Sec. 3 (b), PD 2029).
RPN-9 may not likewise be considered as an "acquired asset corporation" which is one organized under the general corporation law (1) under private ownership at least a majority of the shares of stock of which were conveyed to a government corporation in satisfaction of debts incurred with a government financial institution, whether by foreclosure or otherwise, or (2) as a subsidiary corporation of a government corporation organized exclusively to own and manage, or lease, or operate specific physical assets acquired by a government financial institution in satisfaction of debts incurred therewith, and which in any case by enunciated policy of the government is required to be disposed of to private ownership within a specified period of time" (Sec 3 c, PD 2029), for the following reasons:
- as noted above, the uncontested (not litigated) RPN-9 shares of the government is only 32.4% (not a majority) of its capital stock;
- said 32.4% shares of stock, together with the contested/litigated 40%, were not conveyed to a government corporation or the government "in satisfaction of debts incurred with government financial institution, whether by foreclosure or otherwise;
- RPN-9 was not organized as a subsidiary corporation of a government corporation organized exclusively to own and manage, or lease, or operate specific physical assets acquired by a government financial institution in satisfaction of debts incurred therewith.
It should be parenthetically noted that the 32.4% or 72.4% shares of stocks were turned over to the government by virtue of a compromise agreement between the government and Benedicto in Civil Case No. 0034 which is "a civil action against Defendants Roberto S. Benedicto, Ferdinand E. Marcos, Imelda R. Marcos" and others, to recover from them ill-gotten wealth" (Amended Complaint, Aug. 12, 1987, Civil Case No. 0034, p. 2.) As the case between the government and Benedicto, his family and nominees was compromised, no judicial pronouncement was made as to the character or nature of the assets and properties turned over by Benedicto to the government - whether they are ill-gotten wealth or not.[30]
February 10, 2000
Mr. Edgar S. San Luis
President and General Manager
Radio Philippines Network Inc.
Broadcasting City, Capitol Hills, Diliman
Quezon City
Dear President San Luis,x x x
Relative thereto, please be informed that we affirm the PCGG's opinion that RPNI is not a government-owned and/or controlled corporation (GOCC). Section 2 (13), Introductory Provisions of the Administrative Code of 1987 defines a GOCC as an agency organized as a stock or non-stock corporation vested with functions relating to public needs whether governmental or proprietary in nature, and owned by the government directly or indirectly through its instrumentalities either wholly, or where applicable as in the case of stock corporations to the extent of at least 51% of its capital stock. As government ownership over RPNI is only 32.4% of its capital stock, pending the final judicial determination of the true and legal ownership of RPNI, the corporation is deemed private.[32]
This is not to mention the fact that the other respondents, the RPN officials, are outside the jurisdiction of this Office (Office of the Ombudsman); they are employed by a private corporation registered with the Securities and Exchange Commission, the RPN, which is not a government owned or controlled corporation x x x[34]