Tan, Jr. vs. Matsuura

Courts retain the power to review findings of prosecutors in preliminary investigations via certiorari under Rule 65 in exceptional cases showing grave abuse of discretion, such as when findings are unsupported by facts or law or are made whimsically; furthermore, probable cause for falsification requires evidence showing the alteration changed the document's meaning and caused damage, and cannot be based on mere suspicion, conjecture, or bare denials.

The dispute arose from an intra-corporate conflict in TF Ventures, Inc. Tan alleged that Matsuura stole a pre-signed blank Deed of Trust and, in conspiracy with Tanjutco and Cua, filled in the blanks (number of shares, date, witnesses) and notarized it without Tan’s participation to falsely evidence a transfer of shares. Matsuura claimed the transfer was part of a compromise agreement and that Tan voluntarily caused the notarization.

• March 31, 1998: Tan filed a Complaint-Affidavit with the Office of the City Prosecutor (OCP) of Makati City (I.S. No. 98-C-15857-58) charging falsification under Art. 172(2) in relation to Art. 171(6) and Art. 171(2) of the RPC.
• July 13, 1998: The OCP issued a Resolution dismissing the complaint for lack of probable cause.
• April 4, 2003: The Secretary of Justice (SOJ) denied Tan’s petition for review, affirming the OCP dismissal.
• July 1, 2004: The SOJ (Acting Sec. Gutierrez) granted Tan’s motion for reconsideration, found probable cause, and directed the filing of informations against Matsuura, Tanjutco, and Cua.
• April 4, 2005: The SOJ (Usec. Pineda) modified the July 1, 2004 Resolution, affirming probable cause against Matsuura and Tanjutco but excluding Cua.
• December 12, 2005: The SOJ granted Tan’s partial motion for reconsideration, reversing the exclusion of Cua and directing her inclusion in the information.
• February 6, 2007: The CA (CA-G.R. SP No. 89346) granted Matsuura and Tanjutco’s petition for certiorari, setting aside the DOJ resolutions and affirming the OCP dismissal.
• August 17, 2010: The CA (CA-G.R. SP No. 95263) granted Cua’s petition for certiorari, reversing the DOJ resolutions and upholding the OCP dismissal.
• February 13, 2012: The SC initially denied Tan’s petition in G.R. No. 195816 (Cua) for raising factual issues; Tan filed a motion for reconsideration.
• January 9, 2013: The SC denied the petition in G.R. No. 179003 and denied the motion for reconsideration in G.R. No. 195816.

• Tan charged respondents with falsification regarding a Deed of Trust allegedly stolen from him between December 1996 and January 1997.
• Tan claimed he pre-signed the deed in blank (without date, number of shares, or witnesses) merely to show Japanese investors, but Matsuura allegedly filled in 28,500 shares, dated it January 20, 1997, and added witnesses without Tan’s consent.
• Tan alleged Cua notarized the deed on June 19, 1997 without him appearing or taking an oath before her.
• Matsuura countered that the transfer was a compromise of their intra-corporate dispute and that Tan caused the notarization as a condition of the compromise.
• Tanjutco argued she had no participation and did not know Matsuura at the time of the notarization.
• Cua claimed a person representing himself as Antonio Tan, Jr. appeared before her with a Community Tax Certificate, was sworn in, and she notarized the deed in good faith, reporting it to the Clerk of Court.

• The CA erred in taking cognizance of the petitions for certiorari because courts cannot restrain criminal proceedings once probable cause is determined and an information is filed; the determination of probable cause is purely executive.
• The DOJ correctly found probable cause: the variance in print/font styles between the filled-in entries and the rest of the deed indicated unauthorized insertions; the unnotarized copy attached to Matsuura’s SEC Answer contradicted the claim of notarization; Cua should have been alerted by the 5-month gap between execution and notarization and the differing print styles.
• The CA erred in granting Cua’s motion for extension of time to file her petition, violating A.M. 00-2-03-SC (amending Section 4, Rule 65) which allows extension only for compelling reasons not exceeding 15 days.

• (As reflected in the CA rulings and SC discussion) The DOJ committed grave abuse of discretion; no probable cause existed.
• Tan voluntarily executed the deed; no evidence showed the alleged insertions changed the meaning of the document or caused damage.
• The presumption of regularity in the performance of official duty by a notary public and in the authenticity of public documents was not overcome by Tan’s bare denials.
• Cua exercised due diligence by requiring identification (CTC) from the person who appeared before her.

• Procedural Issues:
  • Whether the CA erred in granting Cua’s motion for extension of time to file the petition for certiorari in CA-G.R. SP No. 95263.
  • Whether the CA erred in taking cognizance of the petitions for certiorari assailing the DOJ’s finding of probable cause.
• Substantive Issues:
  • Whether the CA erred in upholding the OCP’s finding that no probable cause exists to indict Matsuura, Tanjutco, and Cua for falsification under Articles 171 and 172 of the RPC.

• Procedural (Extension): No. Following Vallejo v. Court of Appeals, rules of procedure are tools to facilitate justice; technical lapses may be excused in the interest of substantial justice to afford parties a review rather than cause grave injustice. The CA did not err in allowing the petition to proceed despite the extension.
• Procedural (Review of Prosecutor Findings): No. While the determination of probable cause is executive, judicial power under Section 1, Article VIII of the Constitution includes the power to determine grave abuse of discretion by any branch of government. The CA may take cognizance via Rule 65 when the DOJ’s findings are unsupported by facts or law, or when there is a gross misapprehension of facts, as in this case where the DOJ issued successive contradictory resolutions.
• Substantive (Matsuura and Tanjutco): No probable cause. The elements of falsification under Art. 172(2) in relation to Art. 171(6) of the RPC were not established:
  • Tan failed to prove when and how the alleged unauthorized insertions were made by respondents.
  • No evidence showed the insertions changed the meaning of the document or made it speak something false; Tan’s bare allegation that changes were made without his consent does not equate to showing the insertions were false or altered the intended meaning.
  • No independent evidence of damage or intent to cause damage was shown; the OCP correctly noted that whether notarized or not, the deed was a binding contract, and damage was not proven.
  • Under Art. 171(2) (causing it to appear that persons participated when they did not), private individuals like Matsuura and Tanjutco cannot be held liable without conspiracy with a public officer or notary; since Cua was excluded from the charge, they could not be indicted under this article.
  • Substantive (Cua): No probable cause. The presumption of regularity in the performance of a notary public’s official duty and in the authenticity of the public document stands. Tan’s bare denial that he appeared before Cua was insufficient to overcome this presumption. He failed to present plausible explanation why he could not have appeared on June 19, 1997, or to deny that the CTC indicated in the jurat was his.

• Power of Courts to Review Preliminary Investigation Findings — While determination of probable cause is executive, courts may review via certiorari under Rule 65 in exceptional cases showing grave abuse of discretion (capricious, whimsical, arbitrary, despotic, or bereft of factual and legal justification). This ensures probable criminals are prosecuted and the innocent are spared from baseless prosecution.
• Probable Cause Definition — Such facts as are sufficient to engender a well-founded belief that a crime has been committed and that the accused is probably guilty thereof; requires more than mere suspicion but less than evidence necessary for conviction.
• Elements of Falsification under Art. 171(6) RPC (applied to private individuals under Art. 172(2)):
  1. Alteration (change) or intercalation (insertion) on a document;
  2. Made on a genuine document;
  3. The alteration or intercalation has changed the meaning of the document;
  4. The changes made the document speak something false. Plus (for Art. 172(2)): Independent evidence of damage or intention to cause damage to a third person.
• Elements of Falsification under Art. 171(2) RPC:
  1. Offender is a public officer, employee, or notary public;
  2. He takes advantage of his official position;
  3. He falsifies a document by causing it to appear that persons participated in an act or proceeding when they did not in fact so participate. Note: Private individuals can only be liable if conspiring with a public officer/notary.
• Presumption of Regularity — A notary public’s official duty is presumed regular, and public documents are presumed authentic; overcome only by clear and convincing evidence, not mere denial.
• Presumption of Ordinary Care — Under Section 3(d), Rule 131 of the Rules of Court, a person is presumed to take ordinary care of his concerns; thus, one does not sign a document without informing himself of its contents.

• "Probable cause, for purposes of filing a criminal information, has been defined as such facts as are sufficient to engender a well-founded belief that a crime has been committed and that the accused is probably guilty thereof."
• "While probable cause should be determined in a summary manner, there is a need to examine the evidence with care to prevent material damage to a potential accused’s constitutional right to liberty and the guarantees of freedom and fair play..."
• "There is grave abuse of discretion when the respondent acts in a capricious, whimsical, arbitrary or despotic manner in the exercise of his judgment, as when the assailed order is bereft of any factual and legal justification."
• "It is a far better and more prudent cause of action for the court to excuse a technical lapse and afford the parties a review of the case to attain the ends of justice, rather than dispose of the case on technicality and cause grave injustice to the parties."

• Vallejo v. Court of Appeals (471 Phil. 670) — Allowed petitions to proceed despite procedural defects in the interest of substantial justice.
• Tan v. Ballena (G.R. No. 168111) — Courts may review DOJ findings via certiorari under Rule 65 in exceptional cases of grave abuse of discretion.
• Garcia v. Court of Appeals (513 Phil. 547) — Enumerated the elements of falsification under Art. 171(6) RPC.
• Allied Banking Corporation v. Court of Appeals (527 Phil. 46) — Applied the presumption that a person takes ordinary care of his concerns.
• Borlongan, Jr. v. Peña — Defined grave abuse of discretion and probable cause.
• Ching v. The Secretary of Justice — Emphasized the need to examine evidence with care in preliminary investigations to protect constitutional rights.

• Art. 171 (par. 2 & 6), RPC — Falsification by public officer, employee, or notary (causing appearance of participation; alteration changing meaning).
• Art. 172 (par. 2), RPC — Falsification by private individuals (use of falsified documents).
• Sec. 1, Art. VIII, 1987 Constitution — Judicial power includes the duty to settle controversies and determine grave abuse of discretion.
• Rule 65, Rules of Court — Certiorari.
• A.M. 00-2-03-SC (amending Sec. 4, Rule 65) — Period for filing certiorari petitions (60 days) and extension limits.
• Sec. 3(d), Rule 131, Rules of Court — Presumption that a person takes ordinary care of his concerns.