Case Digest (G.R. No. 193657)
Facts:
In VIRGILIO GASTON, HORTENCIA STARKE, et al. v. REPUBLIC PLANTERS BANK, PHILIPPINE SUGAR COMMISSION, and SUGAR REGULATORY ADMINISTRATION (G.R. No. 77194, March 15, 1988), petitioners, representing themselves and a large class of sugar producers, planters, and millers, sought a Writ of Mandamus compelling respondents to privatize the Republic Planters Bank (RPB) by transferring to them the shares held in the bank by the Philippine Sugar Commission (PHILSUCOM). PHILSUCOM, created under Presidential Decree No. 388 in 1974, was charged with collecting a Stabilization Fund of ₱2.00 per picul for five years and ₱1.00 thereafter (of which ₱0.50 per picul was earmarked for Commission personnel costs) to finance and stabilize the sugar industry. These fees funded PHILSUCOM’s subscription to 761,416 common shares and 53,005,045 preferred shares in RPB, valued at a total of ₱290,972,224.72. After the 1986 takeover, Executive Order No. 18 dissolved PHILSUCOM but maintained its juridicalCase Digest (G.R. No. 193657)
Facts:
- Parties and Representation
- Petitioners: Sugar producers, planters, and millers, acting individually and as representatives of a larger class.
- Respondents:
- Philippine Sugar Commission (PHILSUCOM), later succeeded by the Sugar Regulatory Administration (SRA).
- Republic Planters Bank (the Bank).
- Intervenors: Angel H. Severino, Jr., et al., and the National Federation of Sugar Planters (NFSP).
- Legal and Institutional Background
- P.D. No. 388 (Feb. 2, 1974) created PHILSUCOM and established a Stabilization Fund, levying P2.00 per picul for five years and P1.00 thereafter.
- Executive Order No. 18 (May 28, 1986) abolished PHILSUCOM, created SRA, and preserved PHILSUCOM for winding up affairs.
- Facts Giving Rise to the Petition
- Stabilization fees (P1.00 per picul) were collected from planters and millers and deposited in PNB as a “Development and Stabilization Fund” “administered in trust” by PHILSUCOM under Sec. 7, P.D. 388.
- PHILSUCOM used proceeds of the Stabilization Fund to subscribe to 761,416 common shares and 53,005,045 preferred shares of Republic Planters Bank.
- Petitioners filed for a Writ of Mandamus to compel respondents to transfer the shares from PHILSUCOM’s name to the sugar producers as true beneficial owners.
- A Trust Agreement (May 28, 1986) between PHILSUCOM and RPB-Trust Department failed for lack of PHILSUCOM Board approval and adverse COA opinion.
- Respondents PHILSUCOM/SRA contended:
- No resulting trust arose from Sec. 7, P.D. 388.
- Fees are government funds under the Government Auditing Code.
- Transfer of shares would be irregular or illegal.
- Petition is barred by laches.
Issues:
- Are the stabilization fees collected under Sec. 7, P.D. 388 trust funds held for the sugar producers, or are they public funds?
- Do the shares of Republic Planters Bank, purchased with the Stabilization Fund, belong beneficially to PHILSUCOM (and its successor SRA) or to the sugar producers, planters, and millers?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)