Case Digest_Republic of the Philippines represented by the AMLC v Tinga and Hon.

Antonio Eugenio Jr Facts: Following the promulgation of Agan, a series of investigations concerning the award of the NAIA 3 contracts to PIATCO were undertaken by the Ombudsman and the Compliance and Investigation Staff (CIS)of petitioner AMLC. On May 24, 2005, the OSG wrote the AMLC requesting the latters assistance in obtaining more evidence to completely reveal the financial trail of corruption surrounding the NAIA 3 project, and also noting that petitioner RP was presently defending itself in 2 international arbitration cases filed in relation to the NAIA 3 project. The CIS conducted an intelligence database search of certain individuals involved in the award. On June 27, 2005, the AMLC issued a resolution wherein the Council resolved to authorize the Executive Director of the AMLC to sign and verify an application to inquire and/or examine the deposits or investments of Pantaleon Alvarez and others. It was found during the investigation that amounts were transferred from a HK bank account owned by Jetstream Pacific Ltd to bank accounts in the Philippines maintained by Liongson and Cheng Yong. AMLC filed an application to inquire into or examine the deposits or investments of Alvarez and the others. The trial court being satisfied that there existed to believe that the deposits in various bank accounts, details of which appear in paragraph 1 of the application, are related to the offense of violation of Anti-Graft and Corrupt Practices Act now the subject of criminal prosecution before the Sandiganbayan as attested in the submitted information. The CIS proceeded to inquire and examine the said deposits. Following the 2005 AMLC Resolution, the Republic filed an application before the Manila RTC to inquire into and/or examine 13 accounts and 2 related web of accounts alleged as having been used to facilitate corruption in the NAIA 3 project. On January 12, 2006, the RTC issued an order granting ex parte application expressing the allegations in said application to be impressed with merit, and in conformity with section 11 of RA No. 9160, as amended, otherwise known as the AMLA of 2001. Authority was granted to the AMLC to inquire into the bank accounts of listed therein. The RTC then issued an order staying the enforcement of its bank inquiry order and giving the Republic 5 days to respond to Alvarezs motion. The Republic filed an Omnibus Motion for Reconsideration. Alvarez filed a Reply and Motion to Dismiss the application for bank inquiry order. The RTC granted the Motion for Reconsideration, denying Alvarezs motion to dismiss and reinstating in full force and effect the order. The Republic filed an Urgent Omnibus Motion for Reconsideration, urging that it be allowed to immediately enforce the bank inquiry order against Alvarez and the Alvarezs notice of appeal be expunged from the records since appeal from an order of inquiry is disallowed under the AMLA. The RTC issued an order resolving to hold in abeyance the resolution of the urgent omnibus motion for reconsideration then pending before it until the resolution of Lilia Chengs petition for certiorari with the CA. The CA resolution directing the issuance of the temporary restraining order is the second of the four rulings assailed in the present petition.

The present Consolidated Petition for certiorari and prohibition under Rule 65 was filed on 2 October 2006, assailing the two Orders of the Manila RTC dated 25 July and 15 August 2006 and the Temporary Restraining Order dated 1 August 2006 of the Court of Appeals. Through an Urgent Manifestation and Motion dated 9 October 2006, petitioner informed the Court that on 22 September 2006, the Court of Appeals hearing Lilia Chengs petition had granted a writ of preliminary injunction in her favor. Thereafter, petitioner sought as well the nullification of the 22 September 2006 Resolution of the Court of Appeals, thereby constituting the fourth ruling assailed in the instant petition. Issue: Whether or not the subject bank inquiry orders are valid Held: The petition is dismissed. In order for this Court to rule on the petition at bar which insists on the enforceability of the said bank inquiry orders, it is necessary for us to consider and rule on the same question which after all is a pure question of law. SECTION 2. All deposits of whatever nature with banks or banking institutions in the Philippines including investments in bonds issued by the Government of the Philippines, its political subdivisions and its instrumentalities, are hereby considered as of an absolutely confidential nature and may not be examined, inquired or looked into by any person, government official, bureau or office, except upon written permission of the depositor, or in cases of impeachment, or upon order of a competent court in cases of bribery or dereliction of duty of public officials, or in cases where the money deposited or invested is the subject matter of the litigation. (Emphasis supplied) Nowhere in the legislative record cited by Lilia Cheng does it appear that there was an unequivocal intent to exempt from the bank inquiry order all bank accounts opened prior to the passage of the AMLA. There is a cited exchange between Representatives Zamora and Lopez where the latter confirmed to the former that deposits are supposed to be exempted from scrutiny or monitoring if they are already in place as of the time the law is enacted. That statement does indicate that transactions already in place when the AMLA was passed are indeed exempt from scrutiny through a bank inquiry order, but it cannot yield any interpretation that records of transactions undertaken after the enactment of the AMLA are similarly exempt. Due to the absence of cited authority from the legislative record that unqualifiedly supports respondent Lilia Cheng thesis, there is no cause for us to sustain her interpretation of the AMLA, fatal as it is to the anima of that law. Prior to the enactment of the AMLA, the fact that bank accounts or deposits were involved in activities later on enumerated in Section 3 of the law did not, by itself, remove such accounts from the shelter of absolute confidentiality. Prior to the AMLA, in order that bank accounts could be examined, there was need to secure either the written permission of the depositor or a court order authorizing such examination, assuming that they were involved in cases of bribery or dereliction of duty of public officials, or in a case where the money deposited or invested was itself the subject matter of the litigation. The passage of the AMLA stripped another layer off the rule on absolute confidentiality that provided a measure of lawful protection to the account holder. For that reason, the application of the bank inquiry order as a means of inquiring into records of transactions entered into prior to the passage of the AMLA would be constitutionally infirm, offensive as it is to the ex post facto clause.

We can hardly presume that Congress intended to enact a self-defeating law in the first place, and the courts are inhibited from such a construction by the cardinal rule that a law should be interpreted with a view to upholding rather than destroying it. Case Digest_Republic of the Philippines v GLASGOW Credit and Collection Services Inc Facts: On July 18, 2003, the Republic filed a complaint in the RTC for civil forfeiture of assets against the bank deposits maintained by Glasgow in CSBI. The case filed pursuant to RA 9160 (AMLA 2001). Acting on the Republics urgent plea for the issuance of TRO, the executive judge of RTC issued a 72-hour of a writ of preliminary injunction. The trial court issued an order granting the issuance of a writ of preliminary injuction. In order, the trial court directed the issuance of alias summons. However, no mention was made of the motion for leave of court to serve summons by publication. In an order, the trial court archived the case allegedly for failure of the Republic to serve the motion for leave of court to serve summons by publication. In an order, the trial court ordered the reinstatement of the case and directed the Republic to serve the alias summons on Glasgow and CSBI within 15 days. However, it did not resolve the Republics motion for leave of court to serve summons by publication. Because the Republics motion for leave of court to serve summons by publication remain unresolved, the Republic filed a manifestation and ex parte motion to resolve its motion for leave of court to serve summons by publication. Glasgow filed for motion to dismiss. It alleged that the court had no jurisdiction over its person as summons had not yet been served on it; and that the complaint was premature and stated no cause of action; and there was failure to prosecute on the part of the Republic. The RP opposed Glasgows motion to dismiss. It contended that its suit was an action quasi in rem where jurisdiction over the person of the defendant was not a prerequisite to confer jurisdiction on the court. It asserted that prior conviction for unlawful activity was not a precondition to the filing of a civil forfeiture case and that its complaint alleged ultimate facts sufficient to establish a cause of action. It denied that it failed to prosecute the case. The trial court issued the assailed order. It dismissed the case on the grounds of improper venue; insufficiency of the complaint in form and substance; and failure to prosecute. It lifted the writ of preliminary injunction and directed CSBI to release to Glasgow the funds. Issue: Whether or not the complaint for civil forfeiture was correctly dismissed on grounds of (a) improper venue, (b) insufficiency in form and substance; and (c) failure to prosecute Held: the case is remanded to the RTC, which shall proceed with the case. (a) The trial court was a proper venue. Sec. 3. Venue of cases cognizable by the regional trial court. A petition for civil forfeiture shall be filed in any regional trial court of the judicial region where the monetary instrument, property or proceeds representing, involving, or relating to an unlawful activity or to a money laundering offense are located; provided, however, that where all or any portion of the monetary instrument, property or proceeds is located outside the Philippines, the petition may be filed in the regional trial court in Manila or of the judicial region where any portion of the monetary instrument, property, or proceeds is located, at the option of the petitioner. (emphasis supplied) Under Section 3, Title II of the Rule of Procedure in Cases of Civil Forfeiture, therefore, the venue of civil forfeiture cases is any RTC of the judicial region where the monetary instrument, property or proceeds representing, involving, or relating to an unlawful activity or to a money laundering offense are located. Pasig City, where the account sought to be forfeited in this case is situated, is within the National Capital Judicial Region (NCJR). Clearly,

the complaint for civil forfeiture of the account may be filed in any RTC of the NCJR. Since the RTC Manila is one of the RTCs of the NCJR,10 it was a proper venue of the Republics complaint for civil forfeiture of Glasgows account. (b) The test of the sufficiency of the facts alleged in the complaint is whether or not, admitting the facts alleged, the court could render a valid judgment upon the same in accordance with the prayer of the complaint. Regardless of the absence, pendency or outcome of a criminal prosecution for the unlawful activity or for money laundering, an action for civil forfeiture may be separately and independently prosecuted and resolved.

(c) Given the circumstances, how could the Republic be faulted for failure to prosecute the complaint for civil forfeiture? While there was admittedly a delay in the proceeding, it could not be entirely or primarily ascribed to the Republic. That Glasgows whereabouts could not be ascertained was not only beyond the Republics control, it was also attributable to Glasgow which left its principal office address without informing the Securities and Exchange Commission or any official regulatory body (like the Bureau of Internal Revenue or the Department of Trade and Industry) of its new address. Moreover, as early as October 8, 2003, the Republic was already seeking leave of court to serve summons by publication. In Marahay v. Melicor,18 this Court ruled: While a court can dismiss a case on the ground of non prosequitur, the real test for the exercise of such power is whether, under the circumstances, plaintiff is chargeable with want of due diligence in failing to proceed with reasonable promptitude. In the absence of a pattern or scheme to delay the disposition of the case or a wanton failure to observe the mandatory requirement of the rules on the part of the plaintiff, as in the case at bar, courts should decide to dispense with rather than wield their authority to dismiss. (emphasis supplied) We see no pattern or scheme on the part of the Republic to delay the disposition of the case or a wanton failure to observe the mandatory requirement of the rules. The trial court should not have so eagerly wielded its power to dismiss the Republics complaint. Case Digest_Republic v Cabrini Facts: AMLC issued freeze orders against various bank accounts of respondents. The frozen accounts were previously found prima facie to be related to the unlawful activities of the respondents. The AMLC filed with the CA various petitions. It invoked the jurisdiction of the CA in the belief that the power given to the CA to issue a TRO or writ of injunction against any freeze order issued by the AMLC carried with it the power to extend the effectivity of a freeze order. The CA disagreed and dismissed the petitions. Issue: Which court has jurisdiction to extend the effectivity of a freeze order? Held: The amendment by RA 9194 of RA 9160 erased any doubt on the jurisdiction of the CA over the extension of freeze orders. As the law now stands, it is solely the CA which has the authority to issue a freeze order as well as to extend its effectivity. It also has the exclusive jurisdiction to extend existing freeze orders previously issued by the AMLC vis--vis accounts and deposits related to money-laundering activities.