G.R. No. 77194 - Gaston vs. Republic Planters Bank

Petitioners are sugar producers, planters, and millers suing individually and in representation of similarly situated industry stakeholders; intervenors include individual Negros Occidental planters and the National Federation of Sugarcane Planters (NFSP).
Respondents are Republic Planters Bank (RPB), the Philippine Sugar Commission (PHILSUCOM), and the Sugar Regulatory Administration (SRA). RPB is a commercial bank; PHILSUCOM was the government regulator of the sugar industry created under P.D. No. 388; SRA succeeded PHILSUCOM under E.O. No. 18 (May 28, 1986), with PHILSUCOM to subsist for three years to wind up affairs.

Petitioners seek a writ of mandamus to compel the “privatization” of RPB by transferring to sugar producers the shares registered in PHILSUCOM’s name—761,416 common shares valued at P36,548,000.00 and 53,005,045 preferred shares (A, B, C) with total par value P254,424,224.72, aggregating P290,972,224.72—allegedly paid from the P1.00 per picul stabilization fund under P.D. No. 388.
RPB does not oppose, taking a neutral stance and welcoming judicial resolution as to legal ownership of the disputed shares.

P.D. No. 388 (February 2, 1974) created PHILSUCOM and established a Development and Stabilization Fund “to be administered in trust by the Commission,” financed by stabilization fees of P2.00 per picul for the first five years, and P1.00 per picul yearly thereafter, collectible from planters and millers, with the levy constituting a lien on sugar quedans and/or warehouse receipts.
The decree earmarks P0.50 per picul for personnel salaries, benefits, and allowances to ensure efficient PHILSUCOM operations; the fund is to be deposited in Philippine National Bank.

Petitioners contend the stabilization fund is a trust fund for the benefit of planters and millers; RPB shares acquired through the fund are beneficially owned by the sugar producers, with PHILSUCOM merely holding legal title for convenience.
They recount that RPB, originally owned by the Roman-Rojas group, encountered difficulties in 1978; the Central Bank approved a rehabilitation proposal subject to a fresh capital infusion by the Benedicto group, which petitioners claim was actually sourced from PHILSUCOM’s stabilization collections and used to subscribe to RPB shares.

PHILSUCOM and SRA argue no resulting or implied trust arose from Section 7 of P.D. No. 388; stabilization fees are public funds within the Government Auditing Code; and any transfer of shares to private planters would be irregular or illegal; laches is also invoked.
A May 28, 1986 Trust Agreement between PHILSUCOM (as “Trustor”) and RPB Trust Department (as “Trustee”), acknowledging sugar producers as beneficial owners of the shares, never took effect because it lacked approval by the PHILSUCOM Board; SRA declined approval following an adverse COA opinion (June 25, 1986), affirmed by the COA Chairman (January 26, 1987), and SRA revoked the Trust Agreement on February 19, 1987 as of doubtful validity.

Whether stabilization fees collected under Section 7 of P.D. No. 388 are trust funds for planters and millers, or public funds.
Whether RPB shares acquired using said fees belong to PHILSUCOM (and successor SRA) or to the planters and millers who paid the levy.

Are the stabilization fees under Section 7 of P.D. No. 388 trust funds held for the benefit of sugar planters and millers, or are they public funds constituting a special purpose tax?

Do RPB shares paid for using stabilization fees belong in beneficial ownership to the sugar producers (with PHILSUCOM holding only bare title), or do they belong to PHILSUCOM/SRA as government property?

Does mandamus lie to compel transfer of shares to private planters absent a clear legal right and a ministerial duty?
Is the petition barred by laches?