Title
Acting Director, National Bureau of Investigation vs. Caluag
Case
G.R. No. L-16146
Decision Date
May 31, 1961
NBI petitioned to annul lower court orders returning seized slot machines, arguing preventive justice; Supreme Court ruled order final, appealable, and upheld NBI's right to challenge.
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Case Digest (G.R. No. L-16146)

Facts:

  1. Background of the Case:

    • The Acting Director of the National Bureau of Investigation (NBI), representing the Republic of the Philippines, filed a petition for mandamus and certiorari with a preliminary injunction. The petition sought to annul certain orders of the Court of First Instance of Rizal and to compel the court to allow an appeal filed by the petitioner.
  2. Seizure of Slot Machines:

    • On June 3, 1959, the NBI, relying on the Supreme Court's decision in Philipps vs. Municipal Mayor of Caloocan (which declared jackpot slot machines as illegal gambling devices), applied for and obtained search warrants to seize 68 jackpot slot machines in Pasay City. These machines were allegedly being operated in nightclubs, restaurants, and other amusement places.
  3. Criminal Cases and Motion for Return:

    • Criminal charges were filed against the owners of 17 slot machines that were not covered by permits. However, no charges were filed against the owners of the remaining 51 slot machines, which were licensed under Pasay City Ordinance No. 106.
    • On September 1, 1959, the owners of the 51 licensed slot machines (respondents Sixto Magdaluyo and Rodolfo Taylan) filed a motion for the return of their machines, arguing that the machines were not involved in any pending criminal case.
  4. Petitioner’s Opposition:

    • The NBI opposed the motion, invoking the "Theory of Preventive Justice," arguing that the state could retain the machines to prevent their use in further illegal activities, regardless of whether criminal charges were filed.
  5. Court’s Order and Appeal:

    • On September 19, 1959, Judge Hermogenes Caluag ordered the return of the slot machines to the owners. The NBI filed a notice of appeal on October 1, 1959, but the respondents moved to dismiss the appeal, claiming the order was interlocutory and unappealable.
    • On October 19, 1959, Judge Caluag dismissed the NBI’s appeal, and on October 24, 1959, he denied the NBI’s motion for reconsideration, threatening to hold the NBI in contempt for failing to return the machines.
  6. Supreme Court Petition:

    • On October 28, 1959, the NBI filed a petition with the Supreme Court, seeking to annul the orders of Judge Caluag and to compel the court to allow the appeal. The Supreme Court issued a preliminary injunction to prevent the execution of the lower court’s orders.

Issue:

  1. Whether the order of September 19, 1959, directing the return of the slot machines, is interlocutory or final.
  2. Whether the NBI, as a custodian of the seized property, has the legal personality to appeal the order.
  3. Whether the "Theory of Preventive Justice" justifies the retention of the slot machines by the state.
  4. Whether the lower court committed grave abuse of discretion in dismissing the NBI’s appeal and threatening contempt.

Ruling:

  1. Finality of the Order:

    • The Supreme Court ruled that the order of September 19, 1959, was a final order, not interlocutory. It definitively settled the issue of returning the slot machines, and no further proceedings were necessary. Therefore, it was appealable.
  2. NBI’s Right to Appeal:

    • The Court held that the NBI, as a law enforcement agency, had sufficient personality to appeal the order, especially since the judge threatened to hold it in contempt for failing to comply. The NBI’s duty to enforce the law justified its challenge to the order.
  3. Preventive Justice:

    • The Court declined to rule on the merits of the "Theory of Preventive Justice" in this case, as the primary issue was the appealability of the order. The validity of the theory would be addressed in the appeal proceedings.
  4. Grave Abuse of Discretion:

    • The Supreme Court found that Judge Caluag committed grave abuse of discretion in dismissing the NBI’s appeal and in threatening contempt. The order of September 19, 1959, was appealable, and the dismissal of the appeal unlawfully excluded the NBI from its right to appeal.

Ratio:

  1. Final vs. Interlocutory Orders:

    • A final order is one that definitively disposes of a matter, leaving nothing more to be done. An interlocutory order, on the other hand, is issued during the pendency of a case and does not finally resolve the issues. The order of September 19, 1959, was final because it conclusively determined the issue of returning the slot machines.
  2. Right to Appeal:

    • Law enforcement agencies, as custodians of seized property, have the right to appeal orders affecting their custody, especially when such orders are final and appealable. The NBI’s role in enforcing the law gave it standing to challenge the order.
  3. Grave Abuse of Discretion:

    • A judge commits grave abuse of discretion when they act in a manner that is arbitrary, capricious, or contrary to law. Judge Caluag’s dismissal of the appeal and threat of contempt were unjustified, as the order was appealable, and the NBI had a legitimate right to challenge it.
  4. Preventive Justice:

    • While the Court did not rule on the merits of the "Theory of Preventive Justice," it acknowledged that the issue could be raised in the appeal proceedings. The theory, which allows the state to retain property to prevent future crimes, remains a valid legal argument in appropriate cases.

Conclusion:

The Supreme Court set aside the orders of October 19 and 24, 1959, and directed Judge Caluag to allow the NBI’s appeal. The preliminary injunction issued by the Court was made permanent. Costs were imposed on respondents Sixto Magdaluyo and Rodolfo Taylan.


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