Santos vs. Sandiganbayan

Conspiracy liability requires proof that the accused performed an overt act in pursuance or furtherance of the common design; mere presence at conspiracy discussions, even approval of the plan, is insufficient for conviction. Additionally, extrajudicial confessions obtained prior to April 26, 1983 — the date Morales, Jr. vs. Enrile was promulgated — are admissible despite uncounselled waivers of the right to counsel, the Morales-Galit doctrine having no retroactive effect.

A syndicate masterminded by Felipe Salamanca infiltrated the Clearing Center of the Central Bank of the Philippines in 1981, employing two schemes — a "switching scheme" and a "pilferage scheme" — to defraud banks of substantial sums. The pilferage scheme, which is the subject of these cases, involved opening current accounts at a provincial bank (BPI-Laoag) and a city bank (Citibank-Greenhills), pilfering BPI-Laoag checks at the Central Bank clearing house, altering clearing statements and manifests to blot out entries referring to the pilfered checks, and then withdrawing the amounts from Citibank after the clearing period lapsed without any notice of dishonor from BPI-Laoag. Among those charged were Central Bank employees Jesus Estacio (janitor-messenger) and Manuel Valentino (bookkeeper at the Clearing Operations Division), and private individuals Alfredo Fajardo Jr., Rolando Santos, and Marcelo Desiderio.

Sometime in 1981, a syndicate led by Felipe Salamanca infiltrated the Clearing Center of the Central Bank of the Philippines. The syndicate employed two schemes — a switching scheme and a pilferage scheme. In the switching scheme, checks drawn on one bank were misrouted to another to delay clearing, allowing depositors to withdraw before the fraud was discovered; this scheme faltered when the Philippine Veterans Bank discovered the checks were insufficiently funded. The pilferage scheme, which is the subject of these cases, involved opening current accounts at a provincial bank and a city bank, pilfering the provincial bank's checks at the Central Bank clearing house, altering clearing statements and manifests to remove entries referring to the pilfered checks, and then withdrawing the amounts after the clearing period elapsed without any notice of dishonor.

In October 1981, Mariano Bustamante — possibly an alias for Romeo Villasanta — opened a savings account and a current account with BPI-Laoag with minimal deposits. That same month, Marcelo Desiderio, allegedly representing Magna Management Consultant, approached Citibank-Greenhills personal banker Maria Nieves Garrido to open a current account, submitting the required documents and making an initial deposit of ₱10,000.00. A checkbook was issued to Desiderio, and the account was opened with Rolando San Pedro as representative.

On October 15, 1981, Salamanca informed Manuel Valentino, a Central Bank bookkeeper at the Clearing Operations Division, that two checks would be deposited with Citibank the following day and instructed Valentino to watch for them at the clearing house. On October 16, 1981, two BPI-Laoag checks totaling ₱1,000,000.00 were deposited with Citibank-Greenhills under the Magna Management Consultant account. These checks reached the Central Bank on October 19, 1981. Valentino received from Jesus Estacio, a Central Bank janitor-messenger, the demand envelope containing the two checks in a comfort room on the fourth floor. Valentino altered the clearing statement by crossing out the ₱1,000,000.00 amount, leaving only ₱76,416.95 reflected, so that BPI-Laoag would not look for the ₱1,000,000.00 check. He then prepared a Central Bank Manifest with altered figures to conform to the altered clearing statement.

The syndicate repeated the same procedure on October 30, 1981, pilfering two BPI-Laoag checks totaling ₱3,000,000.00, and on November 20, 1981, pilfering two more checks totaling ₱5,000,000.00. In each operation, Valentino asked Estacio to bring the demand envelope to the fourth-floor comfort room, where Valentino took the checks, altered the clearing statements and manifests, and later gave the pilfered checks to Salamanca. Because BPI-Laoag never received the checks totaling ₱9,000,000.00, no notice of dishonor was issued, and Citibank-Greenhills considered the checks cleared and funded. Withdrawals totaling ₱9,000,000.00 were made from the Magna Management Consultant account through checks endorsed by San Pedro and encashed by Jaime Tan between October 26 and December 6, 1981. The proceeds were divided among syndicate members, with Estacio receiving ₱10,000.00, ₱4,900.00, and ₱5,000.00 after the three operations, and Valentino receiving ₱20,000.00, ₱10,000.00, and ₱20,000.00.

On January 28, 1982, BPI discovered a ₱9,000,000.00 discrepancy in its clearing transactions for the three dates. BPI and the Central Bank referred the matter to the NBI. Valentino was brought to the NBI on February 12, 1982, and gave sworn statements on February 13 and March 22, 1982, waiving his right to counsel. Estacio gave his statements on February 17 and March 22, 1982, likewise waiving his right to counsel. Both admitted their participation and identified co-conspirators. At trial, Estacio repudiated his statements, claiming Agent Ranin threatened him with a gun and hit him with a newspaper. Valentino was discharged as a state witness and testified for the prosecution, though his testimony differed from his sworn statements regarding Estacio's participation in the October 19, 1981 operation and Fajardo's involvement in all three crimes. The Sandiganbayan found all four petitioners guilty as co-principals in the three complex crimes of estafa thru falsification of public documents.

• Inadmissibility of Extrajudicial Confessions: Petitioners Estacio and Valentino's extrajudicial confessions were inadmissible because their right to counsel was violated when said confessions were executed, the waivers having been made without the assistance of counsel.
• Improper Discharge of State Witness: The discharge of Valentino from the informations to serve as a state witness was improper.
• Lack of Conspiracy: Conspiracy, which made all petitioners equally guilty, was not adequately proven.
• Liability as Accomplices Only: Petitioners Santos and Estacio averred that, should they be convicted as charged, they should be held individually liable only as accomplices rather than as co-principals.

• Jurisdictional Limitation: The OSG questioned the propriety of raising factual issues in a petition for review on certiorari under Rule 45 of a Sandiganbayan decision, asserting that the Supreme Court's jurisdiction is confined to questions of law and that the Court is not supposed to reweigh evidence but only to determine its substantiality.

• Admissibility of Extrajudicial Confessions: Whether the extrajudicial confessions of Estacio and Valentino, obtained without the assistance of counsel during waiver, are admissible in evidence.
• Validity of Discharge of State Witness: Whether the discharge of Valentino from the informations to be a state witness was proper.
• Proof of Conspiracy: Whether conspiracy was adequately proven to hold all petitioners equally guilty as co-principals.
• Proper Penalty: Whether the Sandiganbayan correctly imposed the indeterminate penalty for the complex crime of estafa thru falsification of public documents.

• Admissibility of Extrajudicial Confessions: Yes. The confessions are admissible, the Morales-Enrile doctrine requiring counsel-assisted waiver having no retroactive application to confessions taken in February 1982, months before that doctrine was promulgated on April 26, 1983.
• Validity of Discharge of State Witness: Yes. The discharge was proper, there being absolute necessity for the testimony of a participant in a conspiracy contrived in secret, satisfying the requirements of Rule 119, Section 9 of the Rules of Court.
• Proof of Conspiracy: Partially. Conspiracy was proven as to Desiderio in all three cases and Estacio in Criminal Case Nos. 5950 and 5951, but not as to Fajardo in any case, Santos in any case, or Estacio in Criminal Case No. 5949, for failure to show overt acts in furtherance of the conspiracy.
• Proper Penalty: No. The Sandiganbayan erred in imposing the maximum period of prision mayor (ten years and one day) as the maximum of the indeterminate sentence; the proper maximum is the medium period of prision mayor (eight years and one day to ten years), no aggravating or mitigating circumstances having been proven.

• Admissibility of Extrajudicial Confessions: The 1973 Constitution, in force at the time the confessions were taken on February 13, 17, and March 22, 1982, did not specify the right against uncounselled waiver of the right to counsel. The doctrine requiring that waiver of the right to counsel be made with the assistance of counsel was first announced in Morales, Jr. vs. Enrile on April 26, 1983, and reiterated in People vs. Galit on March 20, 1985. Under the principle of prospectivity of judicial decisions articulated in Co vs. Court of Appeals, these rulings have no retroactive effect and do not reach waivers made prior to April 26, 1983. The pre-interrogation advisories given to Valentino and Estacio substantially complied with constitutional requirements then prevailing: they were informed of their right to remain silent, that anything they said could be used against them, and of their right to counsel. Once the prosecution shows compliance with pre-interrogation advisories, a confession is presumed voluntary, and the declarant bears the burden of proving involuntariness. Estacio and Valentino failed to present convincing evidence of force or intimidation — no marks of violence, no complaints to administering officers, no criminal or administrative actions against alleged intimidators. Both were sufficiently educated (Valentino held a BSC degree; Estacio reached first year college in banking and finance), and their confessions were replete with details only participants could supply, ruling out involuntariness. The confessions were also admissible as interlocking confessions — independently made without collusion, identical in material respects, and confirmatory of each other — and thus admissible as circumstantial and corroborative evidence against co-accused.

• Validity of Discharge of State Witness: The determination of who should be used as a state witness is part of prosecutorial discretion, but courts ultimately determine whether the requirements of Rule 119, Section 9 of the Rules of Court are satisfied. Estacio was originally discharged but sought re-inclusion for his family's safety. Given the secrecy of the crimes, the prosecution had absolute necessity for the testimony of a participant, satisfying the requirement that where a crime is contrived in secret, discharge of one conspirator is essential. The discrepancies between Valentino's sworn statements and his testimony regarding Estacio's participation in the October 19, 1981 operation and Fajardo's involvement in all three cases were deemed material but not discrediting, as affidavits are generally incomplete and subordinate to open-court declarations. The narration in Valentino's sworn statements was substantially reproduced in his testimony and supported by other testimonial and documentary evidence. The variance was treated as an endeavor to rectify his sworn statements to conform to the truth, and in the absence of any reason to question Valentino's credibility, his testimony on the non-participation of Estacio in Criminal Case No. 5949 and Fajardo in all three cases was controlling.

• Proof of Conspiracy: Conspiracy exists when two or more persons agree to commit a felony and decide to commit it. However, under People vs. Berroya, to hold an accused liable as co-principal by reason of conspiracy, it must be shown that the accused performed an overt act in pursuance or furtherance of the conspiracy — active participation in the actual commission, moral assistance by presence, or moral ascendancy moving co-conspirators to execute the plan. Mere presence at the discussion of a conspiracy, even approval of it without active participation, is insufficient. Fajardo's attendance at three or four conferences, as stated in Valentino's supplementary sworn statement, was insufficient because there was no evidence that he participated in opening a bank account, altering clearing manifests, or withdrawing proceeds. Santos similarly attended several meetings but committed no overt act in furtherance of the scheme; his "car sale" pretext with Salamanca may ring hollow, but the weakness of his defense cannot supply the insufficiency of prosecution evidence. Estacio was acquitted in Criminal Case No. 5949 because Valentino's testimony showed Estacio was not present when the first crime was planned and committed. However, as to the October 30 and November 20, 1981 operations, there was proof beyond reasonable doubt that Estacio carried the demand envelopes to the fourth-floor comfort room where alterations were made — a vital role given his access to these envelopes as janitor-messenger. Desiderio was proven guilty beyond reasonable doubt for both participating in the discussion and mapping out of the scheme and in its actual execution. His knowledge of banking procedures — he had served as BPI branch manager for twenty-seven years — provided the rationale for his having "authored" the scheme. His overt act of opening the Citibank-Greenhills current account for Magna Management Consultant, corroborated by Nieves Garrido and Valentino, facilitated the commission of all three counts. His defense of denial was negligible against the positive testimonies of prosecution witnesses.

• Proper Penalty: The crime committed was the complex crime of estafa thru falsification of public documents. Under Article 48 of the Revised Penal Code, when an offense is a necessary means for committing another, the penalty for the most serious crime shall be imposed in its maximum period. The most serious offense was falsification of public documents under Article 171(4), penalized by prision mayor and a fine not exceeding ₱5,000.00. Under the guidelines in Nizurtado vs. Sandiganbayan, the first step is to consider modifying circumstances. Estacio claimed voluntary surrender as a mitigating circumstance, but this was insufficiently proven — he went to the NBI five days after Valentino was brought there, a day after a Presidential Commitment Order was issued, and the booking sheet stated he was "arrested" on February 16, 1982. With neither aggravating nor mitigating circumstances, Article 64 of the Revised Penal Code requires imposition of the medium period. The propriety of imposing the medium period rather than the maximum period required by Article 48, when no modifying circumstances attend, has been settled and is supported by the doctrine that penal provisions shall be interpreted in favor of the accused. The medium period of prision mayor is eight years and one day to ten years. The Sandiganbayan erroneously imposed ten years and one day, which is already within the maximum period. The proper indeterminate sentence is four years, two months, and one day of prision correccional maximum to ten years of prision mayor medium, plus a fine of ₱5,000.00 for each crime.

• Overt Act Requirement in Conspiracy — To hold an accused liable as co-principal by reason of conspiracy, it must be shown that the accused performed an overt act in pursuance or furtherance of the conspiracy. That overt act may consist of active participation in the actual commission of the crime, moral assistance by presence at the time of commission, or moral ascendancy moving co-conspirators to execute the plan. Mere presence at the discussion of a conspiracy, even approval of it without active participation, is insufficient for conviction. This doctrine, drawn from People vs. Berroya, was applied to acquit Fajardo and Santos entirely and Estacio in Criminal Case No. 5949, while sustaining the convictions of Desiderio and Estacio in the remaining cases.

• Prospective Application of Judicial Decisions — Judicial decisions, although in themselves not laws, are evidence of what the law means, and the principle of prospectivity of statutes applies to them. The Morales-Galit doctrine requiring counsel-assisted waiver of the right to counsel during custodial investigation has no retroactive effect and does not reach waivers made prior to April 26, 1983, the date Morales, Jr. vs. Enrile was promulgated. Extrajudicial confessions taken in February 1982 were thus admissible despite uncounselled waivers, the governing law being the 1973 Constitution which did not specify the right against uncounselled waiver.

• Interlocking Confessions — Extrajudicial confessions independently made without collusion, identical with each other in material respects, and confirmatory of the other are admissible as circumstantial evidence against co-accused implicated therein to show the probability of the latter's actual participation. They constitute an exception to the general rule that extrajudicial confessions are admissible only against the declarants. The confessions of Valentino and Estacio were held to be interlocking confessions, admissible as corroborative evidence against their co-accused.

• Voluntariness of Confessions — Once the prosecution shows compliance with constitutional requirements on pre-interrogation advisories, a confession is presumed voluntary, and the declarant bears the burden of proving involuntariness. Factors indicating voluntariness include the absence of evidence of compulsion or duress, failure to complain to administering officers, no institution of criminal or administrative action against alleged intimidators, no marks of violence, and no medical examination to buttress claims of maltreatment. Voluntariness may also be inferred from the language of the confession — if it exhibits no suspicious circumstances, is replete with details only the accused could supply, and reflects spontaneity and coherence inconsistent with a mind subjected to violence and torture.

• Penalty for Complex Crimes Without Modifying Circumstances — Under Article 48 of the Revised Penal Code, the penalty for the most serious crime shall be imposed in its maximum period for complex crimes. However, when neither aggravating nor mitigating circumstances attend the commission, the medium period of the prescribed penalty shall be imposed pursuant to Article 64, supported by the doctrine that penal provisions shall be interpreted in favor of the accused. The Sandiganbayan's imposition of the maximum period was erroneous.

• "to hold an accused liable as co-principal by reason of conspiracy, he must be shown to have performed an overt act in pursuance or furtherance of the conspiracy. That overt act may consist of active participation in the actual commission of the crime itself, or it may consist of moral assistance to his co-conspirators by being present at the time of the commission of the crime, or by exerting moral ascendancy over the other co-conspirators by moving them to execute or implement the conspiracy. Hence, the mere presence of an accused at the discussion of a conspiracy, even approval of it without any active participation in the same, is not enough for purposes of conviction." — This passage, quoting People vs. Berroya, articulates the controlling ratio decidendi for the acquittals of Fajardo, Santos, and Estacio in Criminal Case No. 5949, establishing that mere presence at conspiracy discussions is insufficient for conviction.

• "the specific provision of the 1987 Constitution requiring that a waiver by an accused of his right to counsel during custodial investigation must be made with the assistance of counsel may not be applied retroactively or in cases where the extrajudicial confession was made prior to the effectivity of said Constitution." — This passage, quoting Filoteo, Jr. vs. Sandiganbayan, establishes the non-retroactivity of the counsel-assisted waiver requirement, the critical basis for admitting the February 1982 confessions.

• "It is also to be noted that APPELLANTS' extrajudicial confessions were independently made without collusion, are identical with each other in their material respects and confirmatory of the other. They are, therefore, also admissible as circumstantial evidence against their co-accused implicated therein to show the probability of the latter's actual participation in the commission of the crime." — This passage, quoting People vs. Encipido, defines the doctrine of interlocking confessions as an exception to the rule that extrajudicial confessions are admissible only against the declarant.

• "An accused may have some reasons for his irresolute action as far as testifying for the prosecution is concerned. Petitioner Estacio had such reason – he feared for the safety of his family considering that he would be up against a syndicate that, because of the success of its evil scheme, had the money to harm their perceived 'enemies.'" — This passage rebukes the Sandiganbayan for drawing a presumption of guilt from Estacio's "wishy-washy" attitude as a state witness, reinforcing the presumption of innocence and the principle that conviction must rest on prosecution evidence, not on the weakness of the defense or the accused's reputation.

• People vs. Berroya, 283 SCRA 111 (1997) — Controlling precedent on the overt act requirement for conspiracy liability. Applied to acquit petitioners Fajardo and Santos for lack of proof of overt acts, and Estacio in Criminal Case No. 5949.
• Morales, Jr. vs. Enrile — The landmark decision promulgated April 26, 1983, establishing the requirement that waiver of the right to counsel during custodial investigation must be made with the assistance of counsel. Held inapplicable retroactively to the February 1982 confessions in these cases.
• People vs. Galit — Reiterated the Morales doctrine on March 20, 1985. Equally inapplicable retroactively.
• Filoteo, Jr. vs. Sandiganbayan, 263 SCRA 222 (1996) — Followed for the proposition that the 1987 Constitution's counsel-assisted waiver requirement may not be applied retroactively to confessions made prior to its effectivity, and for the principle that the Supreme Court may take cognizance of factual issues in exceptional cases involving grave misapprehension of facts.
• People vs. Encipido, 146 SCRA 478 (1986) — Followed for the doctrine of interlocking confessions as an exception to the general rule of admissibility only against the declarant.
• People vs. Alvarez, 201 SCRA 364 (1991) — Followed for the rule that a confession may be received as circumstantial evidence against a co-accused to show probability of participation.
• Nizurtado vs. Sandiganbayan, 239 SCRA 33 (1994) — Followed for the procedural guidelines in imposing penalties for complex crimes, particularly the requirement to first consider modifying circumstances.
• Co vs. Court of Appeals, 227 SCRA 444 (1993) — Followed for the principle of prospectivity of judicial decisions under Articles 4 and 8 of the Civil Code.
• People vs. Fabro, 277 SCRA 19 (1997) — Distinguished. In Fabro, the accused himself recanted his confession; in these cases, a co-conspirator state witness adhered to his confession except as to the participation of two petitioners, which variance was treated as rectification rather than recantation.

• Article 8, Revised Penal Code — Defines conspiracy as existing when two or more persons come to an agreement concerning the commission of a felony and decide to commit it. Applied to determine whether the prosecution proved the agreement and overt acts of each petitioner.
• Article 48, Revised Penal Code — Provides that when an offense is a necessary means for committing another, the penalty for the most serious crime shall be imposed in its maximum period. Applied to classify the offense as a complex crime, but the maximum period requirement was modified by the application of Article 64 when no modifying circumstances were proven.
• Article 64, Revised Penal Code — Provides that when the penalty prescribed by law is a single divisible penalty, the accused shall be imposed the medium period when there are neither aggravating nor mitigating circumstances. Applied to reduce the penalty from the maximum to the medium period of prision mayor.
• Article 171(4), Revised Penal Code — Penalizes any public officer or employee who, taking advantage of official position, falsifies a document by making untruthful statements in a narration of facts. Applied to Valentino's alteration of clearing statements and manifests, with the requisites of (a) untruthful statements in a narration of facts, (b) legal obligation to disclose the truth, and (c) absolutely false facts, all duly proven.
• Article 315, paragraph 2(a), Revised Penal Code — Penalizes estafa by means of fictitious names, false pretenses, or other similar deceits. The informations charged under this provision, but the Court found the crime actually committed fell under Article 318 (other deceits), though the conviction for the complex crime of estafa thru falsification of public documents was sustained.
• Article 318, Revised Penal Code — Penalizes "other deceits" not mentioned in the preceding articles of the chapter. Identified as the provision more properly describing the estafa committed, though the complex crime characterization was maintained.
• Article 29, Revised Penal Code — Governs preventive imprisonment. The Sandiganbayan granted the accused the benefits of preventive imprisonment under this article.
• Article III, Section 12(1), 1987 Constitution — Requires that any person under investigation shall have the right to competent and independent counsel, and that these rights cannot be waived except in writing and in the presence of counsel. Held inapplicable retroactively to confessions made in February 1982.
• Article IV, Section 20, 1973 Constitution — Provides the rights of an accused during custodial investigation, including the right to remain silent and to counsel, and prohibits force, violence, threat, or intimidation. Applied as the governing constitutional provision at the time the confessions were taken.
• Rule 119, Section 9, Rules of Court — Sets the requisites for discharge of an accused to be a state witness: (a) absolute necessity for testimony; (b) no other direct evidence available; (c) substantial corroboration; (d) accused not most guilty; (e) no prior conviction for moral turpitude. Applied to uphold the discharge of Valentino.

Davide, Jr., C.J., Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza, Panganiban, Quisumbing, Pardo, Gonzaga-Reyes, Ynares-Santiago, and De Leon, Jr., JJ., concurred.