Title
Supreme Court
Dans, Jr. vs. People
Case
G.R. No. 127073
Decision Date
Jan 29, 1998
Marcos and Dans convicted for grossly disadvantageous lease agreements with LRTA, violating RA 3019, while acquitted of other charges due to insufficient evidence.

Case Summary (G.R. No. 127073)

Factual Background and Charges

In 1984, Imelda Marcos, then Minister of Human Settlements and ex-officio Chairman of the Light Rail Transit Authority (LRTA), and Jose Dans, Jr., then Minister of Transportation and Communications and ex-officio Vice-Chairman of the LRTA, entered into several contracts involving the LRTA and the Philippine General Hospital Foundation, Inc. (PGHFI), where they also concurrently held positions as Chairman and Director respectively. The LRTA leased two parcels of real property—one in Pasay City covering 7,340 square meters, and another in Sta. Cruz, Manila covering 1,141.20 square meters—to PGHFI through lease agreements with annual escalations and the right to sublease. Shortly after, the PGHFI subleased these properties to private corporations at much higher rental rates.

Marcos and Dans were charged with multiple violations of RA 3019, including conspiring and entering into contracts manifestly and grossly disadvantageous to the government, and accepting employment or acting in a capacity in the PGHFI that presented a conflict of interest during pending transactions with the LRTA.

Legal Issues Presented

  1. Whether the denial of Dans’s demurrer to evidence was proper considering the admissibility and weight of defense expert testimony.
  2. The sufficiency and form of the Informations, particularly whether they adequately informed Marcos of the charges against her.
  3. The constitutionality of Section 3(g) of RA 3019.
  4. Whether Marcos was deprived of her constitutional right to be heard by herself or by counsel.
  5. Whether the evidence was properly appreciated by the Sandiganbayan.
  6. Alleged bias and jurisdictional irregularities involving the Sandiganbayan’s First Division and the Special Division.

Denial of Demurrer to Evidence

Dans filed a demurrer to evidence after the prosecution rested, arguing insufficiency of evidence that the lease contracts were grossly disadvantageous. The court denied the demurrer, relying partly on the advance testimony of Dans’s defense witness, an expert appraiser, Ramon F. Cuervo, Jr. Although demurrers are generally decided on prosecution evidence alone, the court justified its reliance on Cuervo’s prior testimony as part of the case record and a judicial admission by Dans, rendering formal offer of the evidence unnecessary. The Supreme Court upheld this reasoning, emphasizing that the testimony had been taken in open court and was part of the official records, justifying its consideration in ruling on the demurrer.

Sufficiency of the Criminal Informations

The allegations criminalizing acts under Section 3(g) include that respondents, as public officers, entered into contracts on behalf of a government entity that were manifestly and grossly disadvantageous to the government. The Court found these allegations sufficient to inform Marcos of the nature and cause of the accusations. Ambiguities or lack of details could have been addressed through a motion for bill of particulars; however, Marcos made no substantial follow-up after filing such a motion. Thus, the Informations met minimum legal requirements.

Constitutionality of Section 3(g), RA 3019

Marcos challenged the provision as vague and unconstitutional. The Court held that Section 3(g) is clear in establishing the offense as the act of entering into contracts or transactions manifestly and grossly disadvantageous to the government, irrespective of whether the public officer profited. The Court noted the legislative prerogative in defining crimes and emphasized the statute’s objective to curb graft, covering both corrupt and potentially corrupt acts. The provision was upheld as constitutional and not void for vagueness or as an unconstitutional rider.

Right to Counsel and Fair Trial of Marcos

Marcos contended she was denied the right to counsel due to the suspension of her original counsel. The Court found she was continuously represented by other capable lawyers throughout the trial and appeal stages. Moreover, evidence had mostly been presented at the time of counsel’s suspension. The Court further noted Marcos opted not to present evidence, possibly reflecting her strategy or attitude toward the proceedings, and thus was not deprived of the opportunity to be heard.

Appreciation of Evidence and Manifest Gross Disadvantage to Government

The core issue was whether the lease contracts were manifestly and grossly disadvantageous to LRTA and thus to the government. Documentary evidence showed that the lease rates paid by PGHFI to LRTA were significantly lower than the sublease rental rates PGHFI collected from third parties shortly afterward—approximately seven times higher for the Pasay lot and more than double for the Sta. Cruz lot.

Despite expert testimony from Cuervo valuing the leases at amounts close to or exceeding the contract prices, the Sandiganbayan and Supreme Court found this evidence conflicted with the stark disparity between lease and sublease values—demonstrating clear prejudice against government interests. The Court recognized that Marcos, as signatory to both the lease and sublease agreements, had direct involvement and benefited PGHFI, marking a conflict of interest. Conversely, Dans’s signature did not appear on the sublease agreements, and he denied knowledge of them; thus, his liability could not be conclusively established beyond reasonable doubt. The Court acquitted Dans and upheld Marcos’s conviction in Criminal Case No. 17450 but acquitted both in Criminal Case No. 17453 due to lack of sufficient evidence relating to the Sta. Cruz property sublease.

Allegation of Judicial Bias and Improper Court Proceedings

Petitioners alleged bias by the Sandiganbayan, citing active and extensive questioning of defense witness Cuervo by the presiding justice, which they described as prosecutorial rather than judicial. The Court acknowledged the presiding justice’s unusual participation but found no reversible prejudice, especially since petitioners did not object at the time or attempt to mitigate perceived prejudice by redirect examination. The Court further emphasized that evidence sufficient for conviction exists independently of the contentious testimony.

Petitioners also assailed the procedural irregularity arising from the dissolution of the Special Division—formed due to non-unanimity in the First Division—and the informal resolution reached in a restaurant discussion outside official sessions. The Court ruled that once the First Division reached unanimity, the Special Division’s function became superfluous; the dissolution was legal, and the resulting decision valid. The presence of a non-member justice at the informal discussion did not taint the decision’s integrity, and all relevant administrative orders were part of the case record.

Civil Liability and Damages

The Sandiganbayan imposed civil liabi

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