RP vs Sandiganbayan & Imelda Marcos

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G.R. No. 155832 December 7, 2010

REPUBLIC OF THE PHILIPPINES, Petitioner,
vs.
SANDIGANBAYAN (Fourth Division) and IMELDA R. MARCOS, Respondents.

EN BANC

This case involves the validity of a sequestration order signed, not by the Presidential Commission on Good Government (PCGG) Commissioners, but by designated agents and issued prior to the effectivity of the PCGG Rules and Regulations.

Facts:

When then President Corazon Aquino assumed power in 1986, she issued Executive Order 1, creating the PCGG and empowered it to recover all ill-gotten wealth allegedly amassed by the family and close friends of former president Marcos. Through PCGG's Commissioner Raul Daza’s written authority by lawyers Jose Tan Ramirez and Ben Abella, it sequestered any property (particularly the Olot resthouse which is a 17-room affair sitting on 42 hectares of beachfront land, with a golf course, swimming pool, cottages, a pelota court, and a pavilion), documents, money, and other assets of former First Lady Imelda Marcos in Leyte. In 2001 Mrs. Marcos filed a motion to quash the March 18, 1986 sequestration order against the Olot Resthouse,claiming that such order, issued only by Attys. Ramirez and Abella, was void for failing to observe Sec. 3 of the PCGG Rules and Regulations. The rules required the signatures of at least two PCGG Commissioners. The Republic opposed the motion, claiming that Mrs. Marcos was estopped from questioning the sequestration order. In 2002 the Sandiganbayan issued the assailed Resolution,granting the motion to quash and ordering the full restoration of the Olot Resthouse to Mrs. Marcos.

Issue:

Whether or not the March 18, 1986 sequestration order against the Olot Resthouse, issued by PCGG agents before the enactment of the PCGG rules, was validly issued.

Ruling:

Under Section 26, Article XVIII of the Constitution, an order of sequestration may only issue upon a showing "of a prima facie case" that the properties are ill-gotten wealth under Executive Orders 1 and 2. When a court nullifies an order of sequestration for having been issued without a prima facie case, the Court does not substitute its judgment for that of the PCGG but simply applies the law. The absence of a prior determination by the PCGG of a prima facie basis for the sequestration order is, unavoidably, a fatal defect which rendered the sequestration of respondent corporation and its properties void ab initio. Being void ab initio, it is deemed non-existent, as though it had never been issued. The Court is maintaining its above ruling in this case. Although the two PCGG lawyers issued the sequestration order in this case on March 18, 1986, before the passage of Sec. 3 of the PCGG Rules, such consideration is immaterial following our above ruling. The Court DISMISSES the petition for lack of merit and AFFIRMS the challenged resolutions of the Fourth Division of the Sandiganbayan dated February 28, 2002 and August 28, 2002 in Civil Case 0002, which granted respondent Imelda R. Marcos’ Motion to Quash the March 18, 1986 Sequestration Order covering the Olot Resthouse.