Benedicto vs. Court of Appeals

G.R. No. 125359
Imelda Marcos and co-accused charged for failing to report foreign exchange earnings; court upheld jurisdiction, rejected immunity claims, and dismissed prescription arguments.
benedicto court of appeals jurisdiction

Case Summary (G.R. No. 125359)

Factual Background

The petition arose from twenty-five criminal informations filed in 1991–1992 charging petitioners and others with willful failure to submit prescribed reports and to register foreign exchange earnings and accounts in violation of Central Bank Circular No. 960 in relation to Section 34 of Republic Act No. 265. The informations, consolidated before Branch 26 of the Manila RTC, alleged that the accused maintained foreign exchange accounts and received interest earnings from treasury notes and other foreign currency investments from 1983 to 1987 without reporting them to the Central Bank, citing, for example, deposits in Swiss and other foreign banks credited to entities such as Avertina Foundation and Bank Hofmann, AG.

Regulatory Changes and Saving Clauses

While the criminal complaints were pending, the Central Bank promulgated Circular No. 1318 (January 1992) and later Circular No. 1353 (August 1992), which revised rules on non‑trade foreign exchange transactions and removed certain prior approval requirements; both circulars expressly contained saving clauses excepting pending actions and investigations for violations of Circular No. 960 from repeal.

Pretrial and Trial Court Proceedings

Petitioners were allowed to return to the Philippines on September 19, 1993, and posted bail. Petitioners Benedicto and Rivera were arraigned February 28, 1994, and pleaded not guilty; Mrs. Marcos pleaded not guilty earlier on February 12, 1992. On August 11, 1994, petitioners moved to quash all informations on multiple grounds, including lack of jurisdiction, forum shopping, invalid preliminary investigation, repeal and prescription, exemption from reporting, and alleged absolute immunity under a Compromise Agreement. The trial court denied the motion by order of September 6, 1994, and denied reconsideration, ultimately setting the consolidated cases for trial.

Court of Appeals Disposition

The Court of Appeals consolidated the petitions filed by Mrs. Marcos and by petitioners and, on May 23, 1996, found no grave abuse of discretion in the trial court’s denial of the motions to quash except as to Criminal Case No. 91‑101884, which it ordered dismissed. The appellate court otherwise affirmed the trial court’s denial of the motions to quash.

Issues Presented to the Supreme Court

The Supreme Court framed the issues as whether the trial court lacked jurisdiction or whether forum shopping or an invalid preliminary investigation required quashal; whether repeal of Circular No. 960 and of Republic Act No. 265 extinguished criminal liability; whether the actions prescribed; whether petitioners were exempt from reporting requirements; and whether the November 3, 1990 Compromise Agreement granted petitioners absolute immunity from prosecution for the dollar‑salting charges.

Petitioners’ Contentions

Petitioners argued that the Sandiganbayan had exclusive jurisdiction because the charges were essentially violations of Republic Act No. 3019; that the prosecution engaged in forum shopping by splitting charges between the Sandiganbayan and RTC; that preliminary investigation was invalid because petitioners could not personally appear while barred from travel; that repeal of Circular No. 960 and of RA 265 by Circular Nos. 1318/1353 and RA 7653 extinguished liability under Art. 22, Revised Penal Code; that prescription had run given the 1983–1987 dates of the alleged remittances; that petitioners were exempt under Republic Act No. 6426 and Section 10(q) of Circular No. 960 and protected by Swiss bank secrecy laws; and that the Compromise Agreement extended absolute immunity to them.

Jurisdiction and Forum Shopping Analysis

The Court held that jurisdiction is governed by the law in force when the actions were instituted and that P.D. No. 1606 then defined the Sandiganbayan’s jurisdiction. Because violations of Circular No. 960 in relation to Section 34, R.A. 265 carried a penalty not exceeding five years’ imprisonment, the cases fell within the jurisdiction of the regular trial courts, not the Sandiganbayan; therefore the RTC had authority to try the cases. The Court further applied the test for forum shopping and concluded that prosecution under Circular No. 960 and prosecution under Republic Act No. 3019 involve distinct statutory offenses with different elements and objectives — the former punishing failure to report and the latter punishing prohibited receipt — and that separate prosecutions did not constitute impermissible forum shopping.

Preliminary Investigation Waiver Analysis

The Court reiterated that preliminary investigation is a statutory, not constitutional, safeguard and may be waived. The Court found that petitioners expressly waived any objection to the conduct or absence of a preliminary investigation by returning to the Philippines, posting bail, entering pleas, seeking pretrial access to prosecution records, and pursuing motions in the trial court instead of insisting on a new or in‑person preliminary inquiry. Consequently, the trial court did not err in denying the motion to quash on that ground.

Effect of Repeal, Reenactment, and Saving Clauses

Addressing the contention that repeal of Circular No. 960 and of R.A. 265 extinguished liability, the Court observed that Circular Nos. 1318 and 1353 contained explicit saving clauses reserving pending actions and investigations from repeal. The Court also determined that although Section 34 of R.A. 265 was repealed by R.A. 7653, the penal proscription was simultaneously reenacted in Section 36 of R.A. 7653, thereby neutralizing the repeal. Under the well‑established principle that repeal coupled with reenactment preserves accrued rights and liabilities, the repeal did not bar prosecution of the pending offenses.

Ex Post Facto Challenge

The Court considered petitioners’ argument that the increased penalties in R.A. 7653 rendered its application ex post facto. Applying the constitutional prohibition, Art. III, Sec. 22, and established tests for ex post facto laws, the Court found no retroactive application of increased penalties and no taking away of rights vital to life or liberty as they existed at the time of the alleged offenses. Penal provisions operate prospectively unless they are expressly favorable; there was no indication that R.A. 7653 was intended to operate retroactively to petitioners’ detriment.

Prescription Analysis

The Court applied Act No. 3326 to fix an eight‑year prescriptive period for offenses punishable by imprisonment of not less than two but less than six years. The period runs from the day of commission or, if unknown, from discovery. The Court accepted the trial court’s finding that the offenses were discovered after the February 1986 EDSA Revolution when investigative and recovery efforts into alleged illicit acquisitions of the Marcos regime intensified. Given the concealment and protection petitioners enjoyed during the Marcos administration, prescription was tolled until discovery; the informations filed in 1991–1992 were therefore timely.

Exemption Claim Rejected

The Court rejected petitioners’ claim to exemption under Republic Act No. 6426 and Section 10(q) of Circular No. 960, noting that the exemption applied to foreign currency deposits with designated Philippine banks and not to foreign bank accounts maintained abroad as alleged in the informations. The Court fu

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