Jacob vs. Sandiganbayan Fourth Division

A verbal order dismissing a criminal case, issued by the Chairman of a Sandiganbayan division without being reduced to writing and without the approval of the collegiate court, is null and void and cannot serve as the basis for double jeopardy; nor does inordinate delay in reinvestigation automatically warrant dismissal where the State would be deprived of its day in court.

Petron Corporation, a corporation engaged in refining, marketing, and distribution of petroleum products, received Tax Credit Certificates by assignment from 18 firms registered with the Board of Investments and used them to pay excise tax liabilities. The TCCs were issued by the One Stop Shop Inter-Agency Tax Credit & Duty Drawback Center, an office under the Department of Finance created by Administrative Order No. 266 dated February 7, 1992, implementing Article 21 of Executive Order No. 226, the Omnibus Investments Code of 1987, through a Memorandum of Agreement dated August 29, 1989 between the BOI and the DOF. Petitioners Monico V. Jacob and Celso L. Legarda were, respectively, President and Vice-President and General Manager for Marketing of Petron.

From 1993 to 1997, Petron Corporation received Tax Credit Certificates by assignment from 18 private firms registered with the Board of Investments. The TCCs were issued by the One Stop Shop Inter-Agency Tax Credit & Duty Drawback Center, an office under the Department of Finance created by Administrative Order No. 266 dated February 7, 1992. Petron used the assigned TCCs to pay its excise tax liabilities. The practice was for the BOI-registered firms to sign Deeds of Assignment upon delivery of the TCCs to Petron. Petron then forwarded the documents to the OSS with a request for authorization to use the TCCs to pay its excise tax liabilities. DOF Undersecretary Antonio P. Belicena approved Petron’s request through the issuance of Tax Debit Memoranda addressed to the Collection Program Division of the Bureau of Internal Revenue. The BIR Collection Program Division accepted the TCCs as payment for Petron’s excise tax liabilities by issuing its own TDM. The control numbers of the BIR-TDM were indicated on the back of the TCCs, marking the final utilization of the tax credits.

The Fact Finding and Intelligence Bureau of the Office of the Ombudsman found that the transactions involving the TCCs were irregular and violative of the Memorandum of Agreement dated August 29, 1989 between the BOI and the DOF, which implemented Article 21 of Executive Order No. 226, otherwise known as the Omnibus Investments Code of 1987. After preliminary investigation, the Office of the Ombudsman issued a Resolution dated March 27, 2000 finding probable cause against several public officers and private individuals, including petitioners Monico V. Jacob, President, and Celso L. Legarda, Vice-President and General Manager for Marketing, both of Petron, for perpetrating the so-called “tax credit scam.” On April 10, 2000, the Office of the Ombudsman filed a total of 62 Informations, 18 of which, docketed as Criminal Case Nos. 25922-25939, were against DOF Undersecretary Belicena, OSS Deputy Executive Director Uldarico P. Andutan, Jr., petitioners and other Petron officials, and officers of the BOI-registered firms which assigned the TCCs to Petron, charging them with violation of Section 3(e) of Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act.

On April 14, 2000, petitioners and four other Petron officers who were similarly charged filed a Motion for Reinvestigation with the Office of the Ombudsman. On April 17, 2000, the Sandiganbayan Fourth Division issued an Order giving the prosecution 60 days to re-assess its evidence, take appropriate action on the motion, and inform the Court of its findings and recommendations. Sixty days passed without a report from the Office of the Ombudsman; months and an entire year passed with no action. In the meantime, petitioner Jacob was arraigned on June 1, 2000, while petitioner Legarda was arraigned on May 18, 2001. On March 20, 2001, petitioners and other accused Petron officials filed a Motion to Resolve with the Office of the Ombudsman, citing a Memorandum dated January 30, 2001 issued by Special Prosecutor Leonardo P. Tamayo upholding the dropping of charges against Shell official Pacifico Cruz on the ground that there was no sufficient evidence to prove that he was part of the conspiracy. Petitioners asserted that their situation and alleged participation were similar to those of Pacifico Cruz and that they should similarly be dropped. The Office of the Ombudsman took no action.

At the hearing on June 1, 2001, the Sandiganbayan Fourth Division expressly warned the prosecution that failure to resolve the reconsideration or reinvestigation would lead to dismissal of the cases or a show-cause order for contempt. In its Resolution dated June 26, 2001, the Sandiganbayan denied the prosecution’s motion for resetting the scheduled arraignment and pre-trial on July 2, 2001, noting that the reinvestigation had been pending for more than one year and that the court could not countenance the unreasonable delay attributable to the plaintiff. Despite the denial, the prosecution still failed to submit its report during the July 2, 2001 hearing and instead asked for seven more days to resolve the motions for reconsideration; the arraignment and pre-trial were reset to July 17, 2001. One day before the scheduled hearing, the prosecution filed a Manifestation requesting cancellation of the arraignment and pre-trial on the ground that the motions for reconsideration or reinvestigation were still pending. During the July 17, 2001 hearing, the Sandiganbayan directed the prosecution, through Prosecutor Orlando Ines, to terminate the reinvestigation within one more month; the arraignment and pre-trial were reset to August 20, 2001. At the August 20, 2001 hearing, Prosecutor Ines again requested deferment on the ground that the resolutions on the motions for reconsideration or reinvestigation were still pending approval by the Office of the Ombudsman. The defense verbally and consistently invoked its right to speedy trial and moved for dismissal in all hearings. Over more than one year, the Sandiganbayan kept affording the prosecution one chance after another; the 60 days granted became more than 400 days. On August 20, 2001, the Sandiganbayan Fourth Division, through its Chairman, Justice Nario, issued a verbal order dismissing the cases. The dismissal was recorded in the minutes of the hearing, attested to by the Clerk of Court, and signed by the parties.

On August 24, 2001, the prosecution filed a Motion for Reconsideration praying that the summary dismissal be set aside. On August 31, 2001, the Sandiganbayan Fourth Division issued an Order taking cognizance of the Motion for Reconsideration and requiring the accused to file their comments. On February 4, 2002, six months after Justice Nario issued the verbal order of dismissal, the Sandiganbayan Special Fourth Division issued an Order setting aside the verbal order. The Special Fourth Division found that although there was a delay of more than one year, it was not shown to be vexatious, capricious, and oppressive; that the defense’s oral manifestations were more of “knee-jerk reactions” than a serious pursuit of dismissal through a formal written motion or by insisting on a formal ruling and going to certiorari if denied; that considering the nature and importance of the cases, any prejudice from the postponements would be more against the government than the accused; and that no accused had claimed prejudice. Two justices dissented. On February 26, 2002, petitioners, together with four other co-accused Petron officials, filed a Motion for Reconsideration of the February 4, 2002 Resolution; other accused also filed motions for reconsideration and motions to quash or dismiss, which the prosecution opposed. In an Omnibus Resolution dated December 12, 2003, the Sandiganbayan Fourth Division denied all the motions for lack of merit. Petitioners then filed the instant Petition for Certiorari.

• Speedy Trial: Petitioners averred that the Sandiganbayan committed grave abuse of discretion amounting to lack or excess of jurisdiction in denying their right to speedy trial.
• Double Jeopardy: Petitioners asserted that the Sandiganbayan committed grave abuse of discretion in holding that they had not been put in double jeopardy, and that the reversal of Justice Nario’s order of dismissal violated their constitutional right against double jeopardy.
• Lack of Evidence: Petitioners maintained that the Sandiganbayan committed grave abuse of discretion in not considering the glaring lack of evidence against them; they cited the dropping of charges against Shell official Pacifico Cruz for insufficient evidence of conspiracy and argued that their situation and alleged participation were similar.
• Assertion of the Right: Petitioners consistently invoked their right to speedy trial in open court and moved for dismissal every time the prosecution requested deferment or postponement of the hearings.

• Delay Not Vexatious: The Sandiganbayan Special Fourth Division found that although trial was delayed for more than one year, the delay was not vexatious, capricious, or oppressive; the defense’s oral manifestations were knee-jerk reactions and were not seriously pursued through a formal written motion or by insisting on a formal ruling and going to certiorari if denied.
• Prejudice to Government: The Sandiganbayan Special Fourth Division reasoned that any prejudice from the series of postponements would be more against the government than against any of the accused, and that no accused had come forward to claim prejudice.
• Prosecution’s Attribution: The prosecution attributed the delay to the 23 motions for reinvestigation or reconsideration filed by the accused, which the Sandiganbayan granted in its April 17, 2000 Order, and to the failure of the Office of the Ombudsman to terminate its reinvestigation and submit its report within the 60-day period fixed by the Sandiganbayan.
• Opposition to Motions: The prosecution opposed the motions for reconsideration and motions to quash or dismiss filed by the accused.

• Right to Speedy Trial: Whether the Sandiganbayan committed grave abuse of discretion in denying petitioners’ right to speedy trial.
• Validity of the Verbal Dismissal: Whether Justice Nario’s verbal order dismissing Criminal Case Nos. 25922-25939 was a valid and effective dismissal.
• Double Jeopardy: Whether the setting aside of the verbal dismissal violated petitioners’ right against double jeopardy.
• Lack of Evidence: Whether the Sandiganbayan committed grave abuse of discretion in not considering the alleged glaring lack of evidence against petitioners.

• Right to Speedy Trial: No. Although there was undue and inordinate delay in the reinvestigation, the dismissal of the criminal cases was not warranted; the State should not be deprived of its right to prosecute because of the Ombudsman’s ineptitude or nonchalance.
• Validity of the Verbal Dismissal: No. A verbal order of dismissal by the Sandiganbayan Chairman is not a valid dismissal; a judgment or final order must be written, personally and directly prepared and signed by the judge, and must bear the approval of the collegiate court.
• Double Jeopardy: No. Because there was no valid dismissal or termination of the criminal cases, legal jeopardy did not attach; the requisites for double jeopardy were not met.
• Lack of Evidence: No. Probable cause does not require a finding of guilt beyond reasonable doubt; the presence or absence of the elements of the crime is evidentiary and should be resolved after a full-blown trial.

• Right to Speedy Trial: The right to a speedy, impartial, and public trial is guaranteed by Section 14(2), Article III of the Constitution and by Section 1(h), Rule 115 and Section 2, Rule 119 of the Revised Rules of Criminal Procedure. It is relative and flexible; a violation occurs only when the proceeding is attended by vexatious, capricious, and oppressive delays. The Court applied the Corpuz four-factor test: length of delay, reason for delay, the defendant’s assertion of the right, and prejudice to the defendant. The cases had been pending for about one year and four months by the time of the verbal dismissal; the Ombudsman failed to submit its reinvestigation report despite the 60-day period and more than a year thereafter. The accused consistently asserted the right in open court. However, the reinvestigation was undertaken for the protection of petitioners’ own rights and could not be dispensed with; the State also suffered prejudice from the delay. The Court balanced societal interest and the accused’s rights and held that dismissal was too drastic, especially because the People had yet to prove guilt beyond reasonable doubt. The Ombudsman should instead be ordered under pain of contempt to explain the delay.
• Validity of the Verbal Dismissal: The Sandiganbayan is a collegiate court. Under Rule XVIII, Section 1(b) of the 1984 Revised Rules of the Sandiganbayan, now Section 1(b), Rule VIII of the 2002 Revised Internal Rules of the Sandiganbayan, an order, resolution, or judgment must bear the unanimous approval of the members of the division or, in a special division of five, the majority vote. Section 1, Rule 120 of the Revised Rules of Criminal Procedure requires a judgment to be written in the official language, personally and directly prepared by the judge, signed, and containing clearly and distinctly the facts and law upon which it is based. This applies to a final order dismissing a criminal case grounded on the violation of the right to speedy trial. Justice Nario’s verbal order was not reduced to writing and was rejected by majority vote of the Special Division; it is not in esse and ineffective.
• Double Jeopardy: To substantiate double jeopardy, there must be (1) a first jeopardy attached prior to the second; (2) the first jeopardy validly terminated; and (3) the second jeopardy for the same offense, or an offense included or necessarily included in the offense charged in the first information, or an attempt or frustration thereof. Legal jeopardy attaches only upon a valid indictment, before a competent court, after arraignment, when a valid plea has been entered, and when the case was dismissed or otherwise terminated without the express consent of the accused. Since the verbal dismissal was null and void, there was no valid dismissal or termination; legal jeopardy had not attached.
• Lack of Evidence: A prosecutor does not decide whether there is evidence beyond reasonable doubt of guilt; he merely determines whether there is sufficient ground to engender a well-founded belief that a crime has been committed and that the accused is probably guilty. Probable cause does not require an inquiry into whether there is sufficient evidence to secure a conviction. The trial court determines guilt beyond reasonable doubt based on the evidence presented at trial. No trial had yet occurred, so there was no occasion for the full and exhaustive display of evidence; the presence or absence of the elements of the crime is evidentiary and shall be passed upon after a full-blown trial on the merits.

• Right to Speedy Trial and Speedy Disposition — The right is guaranteed in criminal cases and is designed to prevent the oppression of the citizen by holding criminal prosecution suspended over him for an indefinite time and to prevent delays in the administration of justice. It is violated only when the proceeding is attended by vexatious, capricious, and oppressive delays. The Court uses four factors: (a) length of delay; (b) reason for delay; (c) the defendant’s assertion of the right; and (d) prejudice to the defendant. Prejudice includes oppressive pre-trial incarceration, anxiety, impaired defense, drained resources, curtailed associations, and public obloquy. The Court applied this and found delay but held dismissal too drastic because the State should not be deprived of its right to prosecute due to the Ombudsman’s ineptitude.
• Valid Judgment or Final Order; Collegiate Court Action — A judgment must be written in the official language, personally and directly prepared by the judge, signed, and contain clearly and distinctly the facts and law upon which it is based. This applies to a final order dismissing a criminal case on speedy trial grounds. In a collegiate court like the Sandiganbayan, an order, resolution, or judgment must bear the unanimous approval of the division or, in a special division of five, the majority vote. A verbal order of dismissal by the Chairman without these requisites is null and void and not in esse.
• Double Jeopardy — Double jeopardy requires: (1) a first jeopardy attached prior to the second; (2) the first jeopardy validly terminated; and (3) the second jeopardy for the same offense or an offense included or an attempt or frustration thereof. Legal jeopardy attaches only upon: (a) a valid indictment; (b) before a competent court; (c) after arraignment; (d) when a valid plea has been entered; and (e) the case was dismissed or otherwise terminated without the express consent of the accused. Because the verbal dismissal was invalid, no jeopardy attached.
• Probable Cause vs. Guilt Beyond Reasonable Doubt — A prosecutor determines only probable cause, not guilt beyond reasonable doubt. Probable cause is sufficient ground to engender a well-founded belief that a crime has been committed and the accused is probably guilty. The presence or absence of the elements of the crime is evidentiary and is resolved after a full-blown trial. The Court applied this to reject the claim of lack of evidence before trial.
• State’s Right to Prosecute and Balancing of Interests — The State, like any litigant, is entitled to its day in court and a reasonable opportunity to present its case. A precipitate dismissal may increase the workload of the justice system and cause delays. The Court balanced societal interest in prosecuting crimes against the accused’s constitutional rights and held that dismissal was too drastic where the People had yet to prove guilt.

• "The right of the accused to a speedy trial and to a speedy disposition of the case against him was designed to prevent the oppression of the citizen by holding criminal prosecution suspended over him for an indefinite time, and to prevent delays in the administration of justice by mandating the courts to proceed with reasonable dispatch in the trial of criminal cases. Such right to a speedy trial and a speedy disposition of a case is violated only when the proceeding is attended by vexatious, capricious and oppressive delays." — This passage, quoted from Corpuz vs. Sandiganbayan, states the purpose and violation threshold of the constitutional right to speedy trial and speedy disposition.
• "In determining whether the accused has been deprived of his right to a speedy disposition of the case and to a speedy trial, four factors must be considered: (a) length of delay; (b) the reason for the delay; (c) the defendant’s assertion of his right; and (d) prejudice to the defendant." — This is the canonical four-factor test applied by the Court in assessing the speedy trial claim.
• "The rule applies to a final order dismissing a criminal case grounded on the violation of the rights of the accused to a speedy trial. A verbal judgment or order of dismissal is a violation of the provision; hence, such order is, in contemplation of law, not in esse, therefore, ineffective." — This passage establishes that a verbal dismissal order is invalid and cannot terminate a criminal case.
• "In the instant Petition, legal jeopardy has not yet attached since there is so far no valid dismissal or termination of the criminal cases against petitioners." — This states the double jeopardy consequence of the invalid verbal dismissal.

• Corpuz vs. Sandiganbayan, G.R. No. 162214, November 11, 2004, 442 SCRA 294 — Same factual background; the Court followed its ruling that the verbal dismissal was null and void, laid down the four-factor speedy trial test, and held that dismissal was too drastic a remedy.
• Uy vs. Hon. Adriano, G.R. No. 159098, October 27, 2006, 505 SCRA 625 — Cited for the rule that speedy trial is a relative and flexible concept and for the continuous trial provisions of the Revised Rules of Criminal Procedure.
• People vs. Leviste, 325 Phil. 525 (1996) — Cited for the principle that the State is entitled to its day in court and that a hasty dismissal may increase the workload of the justice system and cause delays.
• People vs. Espinosa, 456 Phil. 507, 518 (2003) — Cited for the requisites of double jeopardy and the instances when legal jeopardy attaches.
• Rizon vs. Desierto, 484 Phil. 62 (2004) — Cited for the rule that a prosecutor determines probable cause, not guilt beyond reasonable doubt, and that the presence or absence of the elements of the crime is for trial.
• Tan vs. People, G.R. No. 173637, April 21, 2009, 586 SCRA 139 — Cited for the maxim “justice delayed is justice denied” and the expeditious resolution of criminal cases.

• Section 14(2), Article III, 1987 Constitution — Guarantees the accused the right to a speedy, impartial, and public trial; the Court used it as the constitutional basis for the speedy trial claim.
• Section 1(h), Rule 115, Revised Rules of Criminal Procedure — Provides that the accused is entitled to a speedy, impartial, and public trial.
• Section 2, Rule 119, Revised Rules of Criminal Procedure — Requires continuous trial until terminated, allows postponements only for a reasonable period for good cause, sets the 180-day trial period, and lists factors for continuance.
• Section 4, Rule 119, Revised Rules of Criminal Procedure — Enumerates factors for granting a continuance, cited in the discussion of reasons for delay.
• Section 1, Rule 120, Revised Rules of Criminal Procedure — Requires a judgment to be written in the official language, personally and directly prepared by the judge, signed, and to contain clearly and distinctly the facts and law; applied to invalidate the verbal dismissal.
• Section 12, Article XI, 1987 Constitution — Requires the Ombudsman and his Deputies to act promptly on complaints; cited to show the Ombudsman’s duty to expedite the reinvestigation.
• Section 13, Republic Act No. 6770 (Ombudsman Act of 1989) — Mandates the Ombudsman to act promptly on complaints and enforce liability; cited with the constitutional provision.
• Section 3(e), Republic Act No. 3019 (Anti-Graft and Corrupt Practices Act) — The offense charged in the Informations.
• Article 21, Executive Order No. 226 (Omnibus Investments Code of 1987) — Implemented by the Memorandum of Agreement between the BOI and the DOF; part of the regulatory backdrop of the TCC transactions.
• Administrative Order No. 266 dated February 7, 1992 — Created the One Stop Shop Inter-Agency Tax Credit & Duty Drawback Center under the Department of Finance.
• Rule XVIII, Section 1(b), 1984 Revised Rules of Sandiganbayan; Section 1(b), Rule VIII, 2002 Revised Internal Rules of the Sandiganbayan — Require an order, resolution, or judgment of the collegiate Sandiganbayan to bear unanimous approval of the division or, in a special division of five, the majority vote; applied to invalidate the verbal order.
• Rule 65, Rules of Court — The procedural basis for the Petition for Certiorari.

Renato C. Corona (Chief Justice and Chairperson), Presbitero J. Velasco, Jr., Diosdado M. Peralta, and Jose Portugal Perez.