DENR-PENRO of Virac, Catanduanes and People vs. Eastern Island Shipping Lines Corporation

In judicial confiscation proceedings under P.D. No. 705, the provisions of the Revised Penal Code (RPC) apply suppletorily. Consequently, an instrument or tool used in the commission of the crime—such as a vehicle—cannot be confiscated and forfeited in favor of the Government if it is established to be the property of a third person not liable for the offense, and that third person must be afforded due process to prove such ownership and non-participation.

Two individuals were caught transporting 196 pieces of lumber without the required permits using a ten-wheeler Isuzu dump truck. They pleaded guilty to violating Section 77 of P.D. No. 705 (Revised Forestry Code). The Regional Trial Court (RTC), in its judgment of conviction, ordered the confiscation of the lumber and the truck. Eastern Island Shipping Lines Corporation, the truck's registered owner, later filed an omnibus motion asserting it had leased the truck to a third party and had no knowledge of the illegal activity, seeking the truck's release. The RTC denied the motion, ruling that P.D. No. 705, as a special law, mandated confiscation regardless of ownership.

• Nature of the Offense: Marvin Soria y Sarmiento and Elmer Morauda III y Mirabuna were charged with violating Section 77 of P.D. No. 705 for possessing and transporting 196 pieces of lumber without legal documents, using a ten-wheeler Isuzu dump truck (plate no. ACO 1836).
• Criminal Proceedings and Conviction: Both accused pleaded guilty. The RTC convicted them and, in its March 16, 2018 Judgment, ordered the confiscation of the lumber and the truck. The RTC directed the accused to submit documents proving the truck owner's lack of knowledge, but the law enforcers later refused consent to release the truck.
• Third-Party Claim: Eastern Island Shipping Lines Corporation (respondent), the truck's registered owner, filed an Omnibus Motion on May 9, 2018, claiming it learned of the confiscation only on April 27, 2018. It asserted the truck was leased to Elmer B. Belen under a Contract of Lease and that it had no knowledge of or participation in the crime, invoking Article 45 of the RPC.
• RTC Denial: The RTC denied the motion, ruling that Section 68 of P.D. No. 705, a special law, prevails over Article 45 of the RPC and mandates confiscation without exemption based on ownership.
• CA Intervention: The CA granted respondent's certiorari petition, finding a violation of due process. It held that Article 45 of the RPC applies suppletorily, protecting a third-party owner not liable for the offense, and ordered the truck's release to respondent.

• Primacy of Special Law: Petitioners argued that P.D. No. 705, as a special law, prevails over the general provisions of the RPC. Section 68 of P.D. No. 705 categorically provides for the confiscation of machinery, equipment, implements, and tools used in the illegal transport of forest products as part of the imposable penalty, making ownership irrelevant.
• Confiscation as Mandatory Penalty: Petitioners maintained that confiscation under Section 68 is a mandatory consequence of conviction. The only requirement is proof that the vehicle was used in the commission of the offense, which the prosecution had established.

• Due Process Violation: Respondent countered that it was never impleaded in the criminal case and was denied the opportunity to be heard regarding the confiscation of its property, violating its constitutional right to due process.
• Suppletory Application of RPC: Respondent argued that P.D. No. 705 does not expressly prohibit the suppletory application of the RPC. Article 45 of the RPC clearly exempts instruments belonging to a third person not liable for the offense from confiscation.
• Remedy for Third-Party Claimants: Relying on Sea Lion Fishing Corporation v. People, respondent asserted that a third-party claimant must be allowed to present evidence of ownership and non-participation through a new trial or reopening of the confiscation aspect.

• Due Process: Whether the confiscation of the respondent's truck, without giving it an opportunity to prove its lack of knowledge or participation in the crime, constituted a violation of its right to due process.
• Applicability of Article 45, RPC: Whether Article 45 of the Revised Penal Code, which exempts instruments belonging to a non-liable third person from confiscation, applies suppletorily to judicial confiscation proceedings under P.D. No. 705.
• Propriety of Remedy: Whether the Court of Appeals erred in ordering the outright release of the truck to the respondent instead of remanding the case for further proceedings.

• Due Process Violation: The confiscation order was void for violating respondent's right to due process. The RTC should have allowed the respondent, as a third-party claimant, to prove its ownership and lack of knowledge or participation in the offense before ordering confiscation. A decision rendered in disregard of a fundamental constitutional right is void for lack of jurisdiction.
• Suppletory Application of Article 45, RPC: Article 45 of the RPC applies suppletorily to P.D. No. 705 pursuant to Article 10 of the RPC. Section 68 of P.D. No. 705 is silent on the judicial confiscation of "conveyances," and its provisions on confiscation are similar to Article 45. Therefore, the exemption in Article 45 for property of a non-liable third person must be observed.
• Remand for Proper Proceedings: The CA correctly nullified the RTC Order but erred in ordering the truck's outright release. The respondent's ownership and non-participation are factual matters that must be established through evidence, which the petitioners have the right to examine and refute. The confiscation aspect was remanded to the RTC for proper proceedings.

• Suppletory Application of the RPC to Special Laws — Offenses punishable under special laws are not subject to the RPC, but the RPC serves as supplementary law unless the special law provides otherwise (Article 10, RPC). This principle was applied to hold that Article 45 of the RPC, which protects non-liable third-party owners, supplements the confiscation provisions of P.D. No. 705.
• Due Process in Confiscation Proceedings — The constitutional guarantee that no person shall be deprived of property without due process of law requires that a third-party claimant to an instrument used in a crime must be given an opportunity to be heard and present evidence to prove ownership and non-liability before the property is confiscated and forfeited.
• Distinction Between Administrative and Judicial Confiscation under P.D. No. 705 — Administrative confiscation under Section 68-A is within the DENR's jurisdiction and covers "all conveyances." Judicial confiscation under Section 68 is ordered by the court upon conviction and covers "machinery, equipment, implements and tools," but not expressly "conveyances." The latter is thus subject to the suppletory application of the RPC.

• "Where there is a violation of basic constitutional rights, the courts are ousted from their jurisdiction. Where the denial of the fundamental right to due process is apparent, a decision rendered in disregard of that right is void for lack of jurisdiction." — This passage underscores the jurisdictional consequence of a due process violation, rendering the confiscation order null.
• "Article 45 of the RPC bars the confiscation and forfeiture of an instrument or tool used in the commission of the crime if such be the property of a third person not liable for the offense. For confiscation and forfeiture to ensue, there must be an indictment charging such third person either as a principal, accessory, or accomplice." — This articulates the core protective rule for third-party owners and the requisite legal predicate for confiscation.

• Sea Lion Fishing Corporation v. People, 661 Phil. 621 (2011) — Cited as controlling authority for the procedure that a third-party claimant to an instrument used in a crime must adduce evidence through a new trial or reopening of the confiscation aspect to prove ownership and non-participation.
• DENR v. Daraman, 427 Phil. 263 (2002) — Relied upon to distinguish the jurisdiction over confiscation: the DENR has jurisdiction over the confiscation of "conveyances" under Section 68-A, while the RTC's jurisdiction under Section 68 covers "machinery, equipment, implements and tools" used in the area where the forest products are found.
• Philippine Drug Enforcement Agency v. Brodett, 674 Phil. 121 (2011) — Cited for the principle that a motor vehicle used in a crime is considered an "instrument" thereof under Article 45 of the RPC, and that confiscation is an accessory penalty upon conviction, subject to the third-party owner exemption.

• Section 68, P.D. No. 705 (Revised Forestry Code) — Provides for the penalty for cutting, gathering, or possessing timber without authority and directs the court to order the confiscation of the timber and the "machinery, equipment, implements and tools illegally used." The Court found this provision silent on the confiscation of "conveyances" and subject to suppletory application of the RPC.
• Article 45, Revised Penal Code — Mandates the confiscation and forfeiture of instruments or tools used in the commission of a felony, except when they are the property of a third person not liable for the offense. Applied suppletorily to the judicial confiscation under P.D. No. 705.
• Article 10, Revised Penal Code — Establishes that the RPC is supplementary to special laws unless the latter provide otherwise. Served as the legal basis for applying Article 45 to P.D. No. 705.
• Article III, Section 1, 1987 Philippine Constitution — The due process clause. The Court held that the RTC's confiscation order, issued without hearing the respondent, violated this guarantee.

• Justice Alfredo Benjamin S. Caguioa (Chairperson)
• Justice Japar B. Dimaampao
• Justice Maria Filomena D. Singh
• Justice Antonio T. Kho, Jr. (No separate opinions noted; all concurred.)

• N/A. The decision was unanimous.