Guy v. Asia United Bank
G.R. No. 174874
Decision Date


G.R. No. 174874. October 4, 2007.

GILBERT G. GUY, petitioner, vs. ASIA UNITED BANK, respondent.



In this appeal by way of a petition for review on certiorari under Rule 45 of the dated September 25, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 94361, reversing the Resolution dated April 20, 2006 of the Secretary of Justice in I.S. No. 05-01-00365 and I.S. No. 05-03-02371.

Undisputed are the following factual antecedents:

In 1993, herein respondent Asia United Bank (AUB) granted 3D Industries, Inc. (3D, hereafter) a loan in the form of stand-by letter of credit (L/C) in the amount of P30 million. To guarantee the loan accommodation, Guy, as then Vice President for Operations of 3D and a member of its Board of Directors, and then 3D President Paulino Delfin Pe (Pe) executed on March 23, 1999 a Continuing Guaranty in AUB's favor. Sometime between the months of July and September 2004, AUB issued several L/Cs for 3D's importations in the total amount of US$216,391.26 or the peso equivalent of P11,287,264.00, more or less. For the import transactions, Pe signed several trust receipts in favor of AUB before the imported goods were released to 3D. As specifically provided in the trust receipts thus signed, 3D shall sell the goods for the account of, and, thereafter, remit the proceeds of the sale to, AUB not later than the fixed periods therein stated, or to account for the same, if unsold.

The succeeding relevant events are summarized in the assailed CA Decision, as follows: aAHSEC

However, 3D failed to comply with its obligation as expressly specified in the trust receipts. Consequently, respondent AUB sent two demand letters . . . to 3D and, to petitioner GUY, for the latter to remit the proceeds of the goods in the total amount of P12, 148,816.90 covered by the subject trust receipts. When said demands went unheeded, . . . AUB filed with the Office of the City Prosecutor of Pasig City two (2) complaints against . . . GUY, as majority and controlling stockholder of 3D and by virtue of his continuing guaranty, for estafa under Article 315 1(b) of the Revised Penal Code RPC in relation to P.D. No. 115 or the Trust Receipts Law, docketed as I.S. No. 05-01-00365 and I.S. No. 05-03-02371, respectively.

During the preliminary investigation, . . . GUY alleged that PE, 3D's former President, who executed and signed the subject trust receipts, should have been charged instead of him because it was PE who actively managed the business affairs of 3D at the time when the subject trust receipts were issued. He claimed that being the majority and controlling stockholder of 3D did not automatically make him liable for the offenses charged because he had no hand in the management of 3D.

Petitioner GUY further alleged that the goods covered by the trust receipts . . . were subsequently delivered by 3D to Northern Islands Company, Inc. (NICI), the exclusive distributor of 3D, for the sale and distribution thereof. Thus, when the said goods or the proceeds of the sale thereof were not accounted for by NICI after demands to account for the same were made by 3D, the latter filed several cases against NICI. This circumstance purportedly prevented 3D from complying with the terms and conditions provided for under the subject trust receipts.

xxx xxx xxx

On October 13, 2005, the Investigating Prosecutor, Emmanuel L. Obungen, . . . came out with the Joint Resolution, in I.S. No. 05-01-00365 and I.S. No. 05-03-02371, finding probable cause for the offenses charged. Accordingly, he filed with the Regional Trial Court (RTC), Branch 67, Pasig City two (2) Informations for estafa under Article 315 1(b) of the RPC in relation to P.D. No. 115, docketed as Criminal Case Nos. 131883 and 131884. SAEHaC

Aggrieved, Guy filed with the DOJ Department of Justice a Petition for Review, to which AUB filed a comment . . .

On December 22, 2005, DOJ Secretary Raul GONZALES . . . issued a Resolution, denying the petition for review . . .

Petitioner GUY admittedly received a copy of the December 22, 2005 Resolution . . . on December 28, 2005. On January 11, 2006, he . . . filed a motion for reconsidered thereto.

Respondent AUB filed its its Comment/Manifestation to the motion for reconsideration on April 26, 2006. aEAIDH

xxx xxx xxx

On April 20, 2006, DOJ Secretary GONZALEZ, issued the assailed Resolution, in I.S. No. 05-01-00365 and I.S. No. 05-03-02371, this time, granting the petition for review and reversing his December 22, 2005 Resolution, disposing . . . as follows:

WHEREFORE, the Petition for Review filed by respondent-appellant Gilbert G. Guy is hereby GRANTED, and the assailed Resolution dated October 13, 2005 of the Pasig City Prosecutor's Office is hereby REVERSED and SET ASIDE, and both complaints against respondent-appellant Gilbert G. Guy are hereby DISMISSED. Further, the City Prosecutor of Pasig is hereby ordered to file the corresponding motion to withdraw the Informations in the instant cases for the crime of Estafa under Article 315 (b) of the RPC in relation to

SO ORDERED. (Words in brackets added.)

In gist, the Secretary of Justice predicated his reversal order on the absence of evidence to prove (a) the actual and direct participation of Guy in the trust receipts transactions; (b) Guy's receipt of the goods covered by the trust receipts; and (c) finally Guy's misappropriation or conversion of the goods subject of the trust receipts and/or the proceeds of the sale thereof.

On May 8, 2006, AUB went to the CA on a petition for certiorari under Rule 65 of theCA-G.R. SP No. 94361, the petition ascribed grave abuse of discretion on the part of the Department of Justice (DOJ) Secretary in issuing his resolution of April 20, 2006, it being AUB's main posture that the former had already lost jurisdiction over Guy's motion for reconsideration subject of the resolution. AUB, as petitioner a quo, invoked two other grounds for allowing certiorari. ETAICc

By Resolution dated May 10, 2006, the CA directed Guy to file his comment and, at the same time, issued a temporary restraining order to enjoin the enforcement of the DOJ's April 20, 2006 resolution. On May 19, 2006, Guy sought the inhibition of CA Associate Justices Vicente Q. Roxas and Juan Q. Enriquez on grounds, inter alia, of alleged bias and prejudice against Guy as purportedly manifested by their ruling, with Justice Roxas as ponente, in the related case, i.e., CA G.R. SP No. 87104, involving NICI, Guy and the trust receipts-covered goods imported by 3D and subject of the estafa case adverted to above.

Eventually, on September 25, 2006, the former First Division of the CA rendered its assailed Decision reversing the April 20, 2006 Resolution of the Secretary of Justice. The decretal portion of said decision reads:

WHEREFORE, premises considered, the petition is hereby GRANTED. The April 20, 2006 Resolution of the Secretary of Justice is hereby REVERSED and SET ASIDE. The October 13, 2005 Joint Resolution of the Office of the City Prosecutor of Pasig City, which found probable cause for estafa against petitioner Guy, and the December 22, 2005 Resolution of the Department of Justice, which denied Guy's petition for review, are hereby REINSTATED.

SO ORDERED. (Words in brackets added; emphasis in the original.) EcAISC

The CA confined and predicated its reversal action on the lone issue of loss of jurisdiction, as reflected on the ensuing statements embodied in its challenged decision:

This decision is purely about the [DOJ Secretary's) loss of jurisdiction. It is basic that all his Resolutions are void after his loss of jurisdiction. There is no weighing evidence nor any discretion at all when loss of jurisdiction is the issue. The law is explicit . . . that Resolutions rendered without jurisdiction produce no legal effect whatsoever.

In this case, Secretary of Justice GONZALES acted without jurisdiction in issuing the April 20, 2006 Resolution which was issued long after his first December 22, 2005 Resolution that held that there was probable cause against accused, had already become final and executory when no motion for reconsideration or appeal filed thereto within the reglementary period of appeal. When . . . GONZALES issued his second April 20, 2006 Resolution that reversed his earlier finding and held that there was no probable cause against accused, the DOJ had already lost jurisdiction over the case because [of the finality of the December 22, 2005 Resolution]. . . Emphasis and words in brackets added.)

Hence, the instant petition for review on three (3) grounds. Under the second and what easily is his main submission, petitioner alleged that the CA committed a grave error in finding that the DOJ Resolution dated December 22, 2005 was already final and executory and that the Secretary of Justice, having meanwhile lost jurisdiction over the case, is precluded from recalling or setting aside such resolution, and directing the withdrawal of the Informations in question for estafa, as his April 20, 2006 resolution did. TEAaDC

How the CA arrived at its conclusion that the DOJ resolution the December 22, 2005 Resolution became final and executory and, hence, beyond the jurisdiction of the Secretary of Justice to set aside, is made simple by a consideration of the following premises excerpted from the assailed CA decision, thus:

1. Petitioner Guy received a copy of the one-paged DOJ Resolution dated December 22, 2005 finding a prima facie case against him for estafa on December 28, 2005.

2. Fourteen (14) days from such receipt, or on January 11, 2006, petitioner moved for reconsideration;

3. Section 13 of the National Prosecution Service (NPS) Rule on Appeal, gives a party aggrieved by the decision of the DOJ Secretary in criminal investigation cases ten (10) days from notice within which to file a motion for reconsideration; and cIACaT

4. The motion of the petitioner for reconsideration was filed beyond the ten-day reglementary period prescribed under the NPS Rule on Appeal and thus concluded that when Secretary Gonzales issued the April 20, 2006 Resolution "the DOJ had already lost jurisdiction over the case because the December 22, 2005 Resolution of the DOJ had already become final and executory and therefore the loss of jurisdiction wrote finis to the case."

Petitioner admits to the belated filing, due to an inadvertent miscalculation of and misapprehension on the period of filing, of his motion for reconsideration. Among others, he argues, however, that it was proper for, and within the jurisdictional discretion of, the DOJ Secretary to resolve the motion for reconsideration on the merits and set aside technicalities in the higher interest of justice.

Respondent counters that the DOJ Secretary's Resolution of April 20, 2006 is indeed void for the reason set forth in the assailed CA decision. Furthermore, respondent would have the Court deny this petition owing to what it perceives to be the formal defects thereof, such as lack of proper verification and false certification against forum shopping. It is further alleged that the petition raises matters of facts which are not proper in a review proceedings under Rule 45 of the

The petition is impressed with merit. IDAESH

First off, it should be stressed that the determination of probable cause to warrant prosecution in court is, under our criminal justice system, entrusted at the first instance to public prosecutors and finally to the Secretary of Justice as reviewer of the findings and resolutions of the prosecutors in preliminary investigation cases. In this regard, the authority of the Secretary of Justice to review and order the withdrawal of an information in instances where he finds the absence of a prima facie case is not time-barred, albeit subject to the approval of the court if its jurisdiction over the accused has meanwhile attached. And it is not prudent or even permissible for a court to compel the Secretary of Justice or the fiscal, as the case may be, to prosecute a proceeding originally initiated by him on an information, if he finds that the evidence relied upon by him is insufficient for conviction. Now, then, if the Secretary of Justice possesses sufficient latitude of discretion in his determination of what constitutes probable cause and can legally order a reinvestigation even in those extreme instances where an information has already been filed in court, is it not just logical and valid to assume that he can take cognizance of and competently act on a motion for reconsideration, belatedly filed it might have been, dealing with probable cause? And is it not a grievous error on the part of the CA if it virtually orders the filing of an information, as here, despite a categorical statement from the Secretary of Justice about the lack of evidence to proceed with the prosecution of the petitioner? The answer to both posers should be in the affirmative. As we said in :

Courts cannot interfere with the discretion of the public prosecutor in evaluating the offense charged. He may dismiss the complaint forthwith, if he finds the charge insufficient in form or substance, or without any ground. Or, he may proceed with the investigation if the complaint in his view is sufficient and in proper form. The decision whether to dismiss a complaint or not, is dependent upon the sound discretion of the prosecuting fiscal and, ultimately, that of the Secretary of Justice. Findings of the Secretary of Justice are not subject to review unless made with grave abuse of discretion.

There can be no quibbling that the motion interposed by the petitioner for reconsideration of the December 22, 2005 DOJ Resolution was filed beyond the 10-day reglementary period, or four days late to be precise, prescribed by the (

SEC. 13. Motion for reconsideration. The aggrieved party may file a motion for reconsideration within a non-extendible period of ten (10) days from receipt of the resolution on appeal with the Secretary of Justice . . . . No second or further motion for reconsideration shall be entertained. (Words in bracket added.) DHATcE

But to strike down the April 20, 2006 DOJ Secretary's Resolution as absolutely void and without effect whatsoever, as the assailed CA decision did, for having been issued after the Secretary had supposedly lost jurisdiction over the motion for reconsideration subject of the resolution may be reading into the aforequoted provision a sense not intended. For, the irresistible thrust of the assailed CA decision is that the DOJ Secretary is peremptorily barred from taking a second hard look at his decision and, in appropriate cases, reverse or modify the same unless and until a motion for reconsideration is timely interposed and pursued. The Court cannot accord cogency to the posture assumed by the CA under the premises which, needless to stress, would deny the DOJ the authority to motu proprio undertake a review of his own decision with the end in view of protecting, in line with his oath of office, innocent persons from groundless, false or malicious prosecution. As the Court pointed out in , the Secretary of Justice would be committing a serious dereliction of duty if he orders or sanctions the filing of an information based upon a complaint where he is not convinced that the evidence warrants the filing of the action in court.

And lest it be overlooked, the DOJ Secretary, when he took cognizance of the petitioner's motion for reconsideration, effectively excepted such motion from the operation of the aforequoted Section 13, supra, of augurs well for the petitioner:

In the interest of justice, procedural rules of the most mandatory character in terms of compliance may be relaxed. In other words, if strict adherence to the letter of the law would result in absurdity and manifest injustices, or where the merit of a party's cause is apparent and outweighs consideration of non-compliance with certain formal requirements, procedural rules should definitely be liberally construed. A party-litigant is to be given the fullest opportunity to establish the merits of his complaint or defense rather than for him to lose life, liberty, honor or property on mere technicalities.

So does where the Court allowed the belated filing by we went on to state in that in the absence of an indication of malice to delay the proceedings, the Court would grant relief where a stringent application of the requirement of timeliness of pleadings would deny a litigant, with a meritorious case, substantial justice. IHaECA

To reiterate what we said in and other cases, the rules of procedure should be viewed as mere instruments designed to facilitate the attainment of justice. They are not to be applied with severity and rigidity when such application would clearly defeat the very rationale for their conception and existence. Even the

In the light of the foregoing considerations, we rule that the Secretary of Justice has not, contrary to the assailed holding of the CA, lost jurisdiction over I.S. No. 05-01-00365 and I.S. No. 05-03-02371 due to the perceived finality of his December 22, 2005 Resolution when he issued his Resolution of April 20, 2006. Stated a bit differently, the Secretary of Justice had full power and authority to issue his subsequent resolution dated April 20, 2006 granting petitioner's motion for reconsideration and reversing his earlier resolution of December 22, 2005. The said April 20, 2006 Resolution should, therefore, be considered valid and fully enforceable.

Respondent AUB's claim respecting the flaw of the verification aspect of the instant petition is clearly untenable. Respondent states that the verification attached to the petition is not a proper verification because the petitioner, instead of stating that he has read the petition as required under Rule 7 (Sec. 4) of the caused the preparation of the herein Petition . . . and the allegations contained herein are true and correct to my personal knowledge, as well as on the basis of the authentic records.

Respondent is wrong. For, the statement in the verification that the allegations in the petition are true and correct of his petitioner's own personal knowledge presupposes that the petitioner, as affiant, has read the petition for he could not have had attested, in the first place, to the veracity of the allegations if he has not first read the petition. It would perhaps be different had petitioner merely stated reading the petition since a mere reading is not an assurance that the reader has understood what he had read. It is in understanding what is written that one can logically say that the allegations in the petition are true and correct of one's own personal knowledge. TcIaHC

In any event, the purpose of requiring a verification is to secure an assurance that the allegations in the petition have been made in good faith, or are true and correct, not merely speculative. The requirement is simply a condition affecting the form of pleadings and non-compliance therewith is neither jurisdictional nor renders the pleading fatally defective. A perusal of the verification in question shows sufficient compliance with the requirements of the

As in the perceived flaw in the verification, respondent also urges that the present petition be expunged or summarily denied considering that it fails to comply with the requirements on forum shopping. In the concrete, respondent alleges that the petition contains a "false certification against forum shopping," noting, in this regard that, while the petitioner attests that "to (his) knowledge, there is no similar action or proceedings involving the same issues pending in . . . any tribunal or agency," he did not mention four (4) such actions/cases, namely: People v. Gilbert G. Guy, Crim. Case No. PSG-131-883-84, pending before the RTC of Pasig City, Branch 67; Asia United Bank v. Gilbert G. Guy, I.S. No. 05-12-11759 which resulted in the filing of Criminal Case No. 133244 (People v. Gilbert G. Guy) now on appeal with the CA; and Asia United Bank v. Hon. Raul Gonzales, CA-G.R. SP No. 97850, respondent AUB's petition for certiorari filed with the CA. Respondent AUB asserts that these cases involve very similar issues as those raised in this petition and stem from the same series of transactions, the only basic difference being in the trust receipts subject thereof.

Respondent's stance fails to persuade.

As it were, the petitioner's failure to mention the cases immediately adverted to above did not in any way detract from the correctness of the certification on non-forum shopping or breach the purpose behind the rules on forum shopping. And as the petitioner aptly explained without controversion, People v. Guy (Crim. Case No. 131-883-84) is the case filed pursuant to the December 22, 2005 DOJ resolution before the same was reconsidered or reversed by the DOJ in its subsequent resolution of April 20, 2006, which, in turn, AUB elevated to the CA in CA-G.R. SP No. 94361, whose decision thereon is now the subject of the instant petition. The differing issues in Crim. Case No. 131-883-84 and the present petition need no belaboring.

As to AUB v. Guy (I.S. No. 05-12-11759), petitioner claims that his defense of non-receipt of the goods subject of the trust receipts involved therein was, among other defenses, found by the DOJ to be tenable, which thus led to the issuance of DOJ resolution dated October 4, 2006 ordering the withdrawal of the corresponding information earlier filed in court. caCEDA

People v. Guy (Criminal Case No. 133244), on the other hand, appears to have already been withdrawn pursuant to aforementioned DOJ resolution of October 4, 2006 and, thus, there is not even an issue to speak of in that terminated case.

And AUB v. Gonzales (CA-G.R. SP No. 97850) is another offshoot of I.S. No. 05-12-11759 filed by respondent AUB, assailing the aforementioned DOJ resolution of October 4, 2006, by way of petition for certiorari dated February 8, 2007, i.e., long after the filing of the instant petition on November 27, 2006.

Parenthetically, all four (4) cases were initiated by the respondent. And since it insists that all four involve similar or identical issues as that presented in the present case, perhaps the accusing finger of violating the rule against forum shopping ought to be pointed at respondent.

The essence of forum shopping is the filing of multiple suits involving the same parties for the same cause of action, either simultaneously or successively, for the purpose of obtaining a favorable judgment, through means other than by appeal or certiorari. The rule thus does not apply to cases that arise from an initiatory or original action which has been elevated by way of appeal or certiorari to higher or appellate courts or authorities. This is so not only because the issues in the appellate courts necessarily differ from those in the lower court, but also because the appealed cases are a continuation of the original case and treated as only one case. For, it would be absurd to require, say in this instant petition, to make mention in the certification against non-forum shopping the CA case that is being sought to be reviewed in the petition at bench. ACcTDS

And while it is perhaps anti-climactic to so state as this juncture, a certificate of non-forum shopping is not required or necessary in criminal cases and distinct causes of action. The absence of a provision on non-forum shopping in the

With the foregoing disquisitions, the question of whether or not the petition ought to be summarily dismissed because it allegedly sets forth question of facts need not detain us long.

Reading the petition juxtaposed with the assailed ruling and the premises holding it together wherein the CA stressed that its "decision is purely about public respondent's (DOJ Secretary's) loss of jurisdiction," it is at once apparent that the principal, if not the only issue to be considered in this case, is whether or not the DOJ Resolution of April 20, 2006 is, on jurisdictional ground, a nullity which, definitely is a question of law rather than of fact. For, a question of law exists when a) the controversy concerns the correct application of law and jurisprudence to a certain set of facts; b) the issue does not call for the examination of the probative value of the evidence presented, the truth or falsity of the facts being admitted. A question of fact, on the other hand, exists when the doubt or difference arises as to the truth or falsity of facts or when the query invites calibration of the whole evidence and relevancy of specific surrounding as well as those in relation to each other and to the whole, and the probability of the situation. While the petitioner may have interspersed his arguments with matters which are factual in nature, the desired dismissal of the petition cannot be granted on that basis. For the petition and the core question pivoting on the DOJ Secretary's jurisdiction to issue his April 20, 2006 Resolution can very well be resolved on the basis of operative facts already established or at least not disputed by the parties.

We must make it clear, however, that the withdrawal of the Informations against the petitioner in Criminal Case Nos. 131883 and 131884 of Branch 67 of the RTC of Pasig City, as directed in the April 20, 2006 Resolution of the DOJ Secretary, is a matter addressed to the sole discretion of that court, consistent with our ruling in . HATICc

WHEREFORE, the petition is GRANTED. Accordingly, the Decision of the Court of Appeals dated September 25, 2006 in CA-G.R. SP No. 94361 is NULLIFIED and SET ASIDE and the Resolution of the Secretary of Justice dated April 20, 2006 is REINSTATED.

No pronouncement as to costs.


Puno, C.J., Sandoval-Gutierrez and Corona, JJ., concur.

Azcuna, J., took no part former director of Asia United Bank.


1. Penned by Associate Justice Vicente Q. Roxas, with then Presiding Justice Ruben T. Reyes (now a member of this Court) and Associate Justice Rebecca De Guia-Salvador, concurring; rollo, pp. 10 et seq.

2. Id. at 529 et seq. AEITDH

3. Sec. Raul M. Gonzales.

4. Pages 3-4 of the CA Decision; rollo, pp. 12-13.

5. Rollo, pp. 593 et seq.

6. Id. at 636 et seq.

7. Supra note 1.

8. Supra note 2.

9. Rollo, p. 517.

10. , G.R. No. 158543, July 21, 2004, 434 SCRA 601.

11. , G.R. No. L-53373, June 30, 1987, 151 SCRA 462.

12. Ibid.

13. G.R. No. 156081, October 19, 2005, 473 SCRA 350.

14. G.R. No. 164268, June 28, 2005, 461 SCRA 599, 616. DCScaT

15. G.R. No. 132428, October 24, 2000, 344 SCRA 203, 221, citing cases.

16. G.R. No. L-80040, September 30, 1988, 166 SCRA 203.

17. G.R. No. 52007, September 24, 1987, 154 SCRA 199.

18. G.R. No. 127596, September 24, 1998, 296 SCRA 38.


20. , G.R. No. 13042, September 23, 1999, 315 SCRA 150; , G.R. No. 154410, October 20, 2005, 473 SCRA 541.

21. , G.R. No. 123686, November 16, 1999, 318 SCRA 94, 100; citing cases.

22. , G.R. No. 127683, August 7, 1998, 294 SCRA 73, citing , 260 SCRA 821, 835.

23. , citing 279 SCRA 695, 703.

24. , G.R. No. 138463, October 30, 2006, 506 SCRA 56, 70 citing cases. DTEScI

25. G.R. No. 1260893, November 18, 2005, 475 SCRA 476, 484-485, citing

26. Supra note 11.