G.R. No. 164250 - Office of the Ombudsman vs. Valera

Case Summary (G.R. No. 164250)

Factual Background

Atty. Gil A. Valera was appointed Deputy Commissioner of the Bureau of Customs on July 13, 2001, took his oath on August 3, 2001 and assumed office on August 7, 2001, with responsibility for the Revenue Collection Monitoring Group. A sworn complaint dated July 28, 2003 and received by the Office of the Ombudsman on August 20, 2003, filed by Director Eduardo S. Matillano of the PNP-CIDG, charged Valera with criminal and administrative offenses based on allegations that he compromised a collection case against Steel Asia Manufacturing Corp. without proper authority, thereby prejudicing the government in the amount of P14,762,467.70, that he procured employment for his brother-in-law at a customs brokerage with possible pecuniary interest, and that he traveled abroad without proper authority. A prior complaint by Atty. Adolfo Casareno made similar allegations concerning the compromise with Steel Asia. The complaints were docketed as OMB-C-C-02-0568-I, OMB-C-C-03-0547-J, and OMB-C-A-0379-J.

Procedural History Before the Ombudsman and the Court of Appeals

On November 12, 2003 Ombudsman Simeon V. Marcelo issued a memorandum inhibiting himself from the subject matters and directing Dennis M. Villa-Ignacio, Special Prosecutor, to act in his stead. On March 17, 2004 petitioner Special Prosecutor Villa-Ignacio issued an Order placing Atty. Gil A. Valera under preventive suspension for six months without pay in OMB-C-A-0379-J, finding that Valera compromised the Steel Asia case without authority in violation of Section 2316 of the TCCP and that the elements for preventive suspension under Section 24 of R.A. No. 6770 were present. Valera moved for reconsideration and asserted denial of due process, contending that he had filed a counter-affidavit on November 6, 2003. On April 5, 2004 the Special Prosecutor denied reconsideration but acknowledged receipt of the counter-affidavit. Valera filed a special civil action for certiorari and prohibition with the Court of Appeals before the motion for reconsideration was resolved; the CA issued a temporary restraining order on April 16, 2004. On June 25, 2004 the CA set aside the March 17, 2004 Order on the ground that the Special Prosecutor lacked authority to issue preventive suspension orders and declared Ombudsman Marcelo’s memorandum of inhibition null and void insofar as it purported to vest such authority in the Special Prosecutor. The Office of the Ombudsman and the Special Prosecutor elevated the matter to this Court.

The Petitioners’ Contentions

The petitioners contended that the Ombudsman validly delegated to the Special Prosecutor the authority to act in OMB-C-A-03-0379-J and that such delegation, effected by the Ombudsman’s November 12, 2003 memorandum, vested the Special Prosecutor with full authority to issue the preventive suspension Order. They invoked Section 11(4)(c) of R.A. No. 6770, asserting that the Office of the Special Prosecutor, under the supervision and control and upon the authority of the Ombudsman, may perform such other duties assigned by the Ombudsman, and that the Special Prosecutor possesses rank, qualifications and competence comparable to a Deputy Ombudsman. The petitioners further maintained that the evidence of guilt was strong to warrant preventive suspension because Valera allegedly entered into an unauthorized compromise that waived interest, penalties and damages and effectively exonerated Steel Asia, and because Valera allegedly procured employment for his brother-in-law in violation of R.A. No. 6713 and R.A. No. 3019. Finally, petitioners urged that the CA should have dismissed Valera’s petition for certiorari for violation of the rule on forum shopping.

The Respondent’s Counter-Arguments

Atty. Gil A. Valera argued that the Special Prosecutor had no authority to issue a preventive suspension order because Section 24 of R.A. No. 6770 vests that power expressly only in the Ombudsman and his Deputies. He maintained that Section 11(4)(c) should be read ejusdem generis with the preceding paragraphs and thus limited to duties related to criminal complaints within the Special Prosecutor’s prosecutorial mandate. Valera contended that the Ombudsman’s memorandum could not transform the Special Prosecutor into the Ombudsman or otherwise transfer the Ombudsman’s exclusive power of preventive suspension. He further asserted that the Special Prosecutor issued the suspension without considering his counter-affidavit and that the evidentiary showing was not strong because of the delay in suspension and the PIAB-A recommendation against suspension. Valera also explained his resort to the CA prior to final action on his motion for reconsideration on grounds that the Special Prosecutor had unreasonably delayed disposition.

Issue Presented

The controlling issue for review was whether Dennis M. Villa-Ignacio, as Special Prosecutor, had authority to place Atty. Gil A. Valera under preventive suspension in connection with administrative case OMB-C-A-03-0379-J pending before the Office of the Ombudsman.

Ruling of the Supreme Court

The Court held that the Special Prosecutor had no authority to issue the March 17, 2004 preventive suspension Order and accordingly affirmed the Court of Appeals insofar as it set aside that Order. The petition was denied.

Legal Basis and Reasoning

The Court observed that the Office of the Ombudsman’s constitutional powers under Article XI and the implementing provisions of R.A. No. 6770 permit the Ombudsman to investigate and to undertake prosecutorial functions and to promulgate rules of procedure. The statute makes the Office of the Special Prosecutor an organic component of the Office of the Ombudsman and empowers it, under the supervision and control and upon the authority of the Ombudsman, to conduct preliminary investigation and prosecute criminal cases within the jurisdiction of the Sandiganbayan, to enter into plea bargaining agreements, and to perform such other duties assigned by the Ombudsman (Section 11(4), R.A. No. 6770). The Court reiterated settled doctrine that the Office of the Special Prosecutor is a component of the Office of the Ombudsman and may only act under the Ombudsman’s supervision and control and upon his authority.

The Court analyzed the scope of Section 24 of R.A. No. 6770, which expressly confers the power of preventive suspension upon the Ombudsman and his Deputy. The Court found that the statute’s express mention of the Ombudsman and his Deputies and the omission of the Special Prosecutor indicated a legislative intent to withhold that power from the Special Prosecutor, invoking the canon expressio unius est exclusio alterius. Rank equivalence between the Special Prosecutor and the Deputy Ombudsmen did not, the Court held, enlarge the Special Prosecutor’s powers beyond those expressly granted by statute. The Court further explained that the Ombudsman’s general power to delegate investigatory functions under Section 15(10) of R.A. No. 6770 and the authority vested in the Special Prosecutor by Section 11(4)(c) permit delegation of investigative duties but leave the specific power to place an officer under preventive suspension with the Ombudsman or his Deputy. Consequently, the Special Prosecutor’s proper role in connection with preventive suspension is recommendatory; he may recommend that the Ombudsman or a Deputy impose preventive suspension, but he may not himself impose it.

The Court also addressed the Ombudsman’s November 12, 2003 memorandum of inhibition. It applied the rule that voluntary inhibition by the Ombudsman in administrative proceedings is governed by the same restraints that guide judicial inhibition and must be for just and valid causes. Ombudsman Marcelo’s memorandum did not state any reason for inhibition. Even assuming inhibition were permissible, the memorandum could not lawfully vest in the Spec

Case Syllabus (G.R. No. 164250)

Parties and Procedural Posture

Petitioners Office of the Ombudsman and Dennis M. Villa-Ignacio, in his capacity as Special Prosecutor, Office of the Ombudsman filed a petition for review on certiorari from the Court of Appeals' decision dated June 25, 2004 in CA-G.R. SP No. 83091.
Respondent Atty. Gil A. Valera was the Deputy Commissioner, Office of the Revenue Collection Monitoring Group, Bureau of Customs, who was placed under preventive suspension by an Order dated March 17, 2004 issued by petitioner Special Prosecutor Villa-Ignacio.
The Court of Appeals (Special First Division) set aside the March 17, 2004 Order and directed the Special Prosecutor to desist from further action in OMB-C-A-03-0379-J.
The Supreme Court, in the present petition, denied the petition and affirmed the Court of Appeals insofar as it set aside the March 17, 2004 Order.

Key Factual Allegations

The sworn complaint of July 28, 2003 filed by PNP-CIDG Director Eduardo S. Matillano charged Atty. Gil A. Valera with violations of R.A. No. 3019, the Tariff and Customs Code of the Philippines (TCCP), E.O. No. 38, E.O. No. 298, and R.A. No. 6713, and with administrative offenses of grave misconduct and serious irregularity.
The complaint alleged that on January 30, 2002 Valera compromised Civil Case No. 01-102504 (Republic of the Philippines v. Steel Asia Manufacturing Corp.) without authority and thereby allegedly deprived the government of legal interest, surcharges, litigation expenses and damages totaling P14,762,467.70.
The complaint alleged further that Valera had direct or indirect pecuniary interests in a customs brokerage and intervened in official matters to secure employment for his brother-in-law, Ariel Manongdo, contrary to law.
Civil Case No. 01-102504 involved a principal claim of P37,195,859.00 allegedly payable by Steel Asia for duties and taxes and a compromise that provided for thirty monthly installments of P1,239,862 from January 2002 to June 2004.

Procedural History

The Ombudsman issued a Memorandum dated November 12, 2003 inhibiting himself and directing Special Prosecutor Villa-Ignacio to act in his stead in the related cases.
On March 17, 2004 Special Prosecutor Villa-Ignacio issued an Order placing Valera under preventive suspension for six months without pay in OMB-C-A-0379-J.
Valera filed a motion for reconsideration and concurrently sought injunctive relief with the Court of Appeals, which issued a temporary restraining order on April 16, 2004.
On June 25, 2004 the Court of Appeals rendered a Decision setting aside the March 17, 2004 preventive suspension Order and directing the Special Prosecutor to desist from further action in OMB-C-A-03-0379-J.
The present appeal to the Supreme Court followed, and the Supreme Court denied the petition, affirming the Court of Appeals' annulment of the March 17, 2004 Order.
After the Court of Appeals' decision, the administrative case was assigned to the Deputy Ombudsman for MOLEO, which on August 30, 2004 found Valera guilty of grave misconduct and dismissed him from the service, a decision later affirmed by the Court of Appeals and appealed to the Supreme Court under G.R. No. 167278.

Statutory Framework

Article XI of the 1987 Constitution vests the Office of the Ombudsman with investigatory powers and mandates the composition of the Office including Deputies and a Special Prosecutor.
R.A. No. 6770 (Ombudsman Act of 1989) prescribes the structure, powers, functions and duties of the Office of the Ombudsman and its components including the Office of the Special Prosecutor.
Section 11(4)(c), R.A. No. 6770 authorizes the Office of the Special Prosecutor, under the supervision and control and upon the authority of the Ombudsman, “to perform such other duties assigned to it by the Ombudsman.”
Section 24, R.A. No. 6770 expressly provides that only the Ombudsman and his Deputy m