VINCENT E.

OMICTIN, Petitioner,
vs.
HON. COURT OF APPEALS (Special Twelfth Division) and GEORGE I.
LAGOS, Respondents.
G.R. No.148004 January 22, 2007 FIRST DIVISION AZCUNA, J.

FACTS:

Petitioner Vincent E. Omictin, Operations Manager Ad Interim of Saag Phils., Inc., filed a
complaint for two counts of estafa with the Office of the City Prosecutor of Makati against private
respondent George I. Lagos. He alleged that private respondent, despite repeated demands,
refused to return the two company vehicles entrusted to him when he was still the president of
Saag Phils., Inc..

On February 26, 1999, public prosecutor Alex G. Bagaoisan recommended the indictment of
private respondent, and on the same day, respondent was charged with the crime of estafa
under Article 315, par. 1(b) of the Revised Penal Code before the Regional Trial Court (RTC),
Branch 57 of Makati City. The case was docketed as Criminal Case No. 99-633, entitled
"People of the Philippines v. George I. Lagos."

On June 4, 1999, private respondent filed a motion to recuse praying that Presiding Judge
Reinato G. Quilala inhibit himself from hearing the case based on the following grounds:

a) In an order, dated May 28, 1999, the presiding judge summarily denied respondent’s
motion: 1) to defer issuance of the warrant of arrest; and 2) to order reinvestigation.

b) Immediately before the issuance of the above-mentioned order, the presiding judge
and Atty. Alex Y. Tan, SAAG Philippines, Inc.’s Ad Interim President, were seen
together.

On June 24, 1999, private respondent filed a motion to suspend proceedings on the basis of a
prejudicial question because of a pending petition with the Securities and Exchange
Commission (SEC) involving the same parties.

It appears that on January 7, 1999, private respondent filed SEC Case No. 01-99-6185 for the
declaration of nullity of the respective appointments of Alex Y. Tan and petitioner as President
Ad Interim and Operations Manager Ad Interim of Saag Phils., Inc., declaration of dividends,
recovery of share in the profits, involuntary dissolution and the appointment of a receiver,
recovery of damages and an application for a temporary restraining order (TRO) and injunction
against Saag (S) Pte. Ltd., Nicholas Ng, Janifer Yeo, Tan and petitioner.

Thereafter, the trial court, in an order dated September 8, 1999, denied respondent’s motion to
suspend proceedings and motion to recuse.

His motion for reconsideration having been denied by the trial court in its order issued on
October 29, 1999, respondent filed with the CA the petition for certiorari assailing the aforesaid
orders.
On June 30, 2000, the CA rendered its challenged decision.

In a case for estafa, a valid demand made by an offended party is one of the essential
elements. It appears from the records that the delay of delivery of the motor vehicles by
petitioner to Saag Corporation is by reason of petitioner’s contention that the demand made by
Omictin and Atty. Tan to him to return the subject vehicles is not a valid demand. As earlier
mentioned, petitioner filed a case with the SEC questioning therein private respondents’
appointment.

If the SEC should rule that the dissolution of Saag Phils. is proper, or that the appointments of
private respondents are invalid, the criminal case will eventually be dismissed due to the
absence of one of the essential elements of the crime of estafa.

Based on the foregoing, it is clear that a prejudicial question exists which calls for the
suspension of the criminal proceedings before the lower court.

The assailed Order of September 8, 1999 and October 29, 1999, are hereby MODIFIED. The
motion to suspend proceedings is hereby GRANTED and respondent court is hereby enjoined
from hearing Criminal Case No. 99-633, entitled "People of the Philippines v. George I. Lagos,"
until the termination of the case with the Securities and Exchange Commission. The denial of
the motion to recuse is hereby AFFIRMED.

Incidentally, on January 18, 2001, the SEC case was transferred to the Regional Trial Court
(RTC) of Mandaluyong City, Branch 214, pursuant to A.M. No. 00-11-03-SC implementing the
Securities and Regulation Code (Republic Act No. 8799) enacted on July 19, 2000, vesting in
the RTCs jurisdiction over intra-corporate disputes.

Meanwhile, on March 5, 2001, the CA, addressing petitioner’s motion for reconsideration of the
aforementioned decision, issued its assailed resolution:

Considering that the petition for review on certiorari of the 30 June 2000 decision of this Court,
filed by the Office of the Solicitor General before the Supreme Court has already TERMINATED
on November 20, 2000 and a corresponding entry of judgment has already been issued by the
High Court, that the same is final and executory, the private respondent’s motion for
reconsideration of the decision 30 June 2000 before this Court is NOTED for being moot and
academic.

Hence, this petition raises the following issues:

ISSUE:

RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION

AMOUNTING TO LACK OF JURISDICTION -

A) WHEN IT DECREED THAT A PREJUDICIAL QUESTION EXISTS IN THE SEC CASE

FILED BY PRIVATE RESPONDENT AGAINST SAAG (S) PTE. LTD., A FOREIGN
CORPORATION, ALTHOUGH THE PRIVATE COMPLAINANT IN THE CRIMINAL CASE FOR
ESTAFA (WHERE PRIVATE RESPONDENT IS THE ACCUSED THEREIN) IS ACTUALLY
SAAG PHILIPPINES, INC. A DOMESTIC CORPORATION WITH A SEPARATE JURIDICAL
PERSONALITY OF ITS OWN AND WHICH IS NOT EVEN A PARTY IN THE SEC CASE; AND,

Saag Phils., Inc. has a separate corporate existence and is to be treated as a separate
entity from its holding or parent company, Saag (S) Pte. Ltd. The mere fact that one or
more corporations are owned or controlled by the same or single stockholder is not a
sufficient ground for disregarding separate corporate personalities;

Private respondent’s petition with the SEC seeks affirmative relief against Saag (S) Pte.
Ltd. for the enforcement or application of the alleged terms of the joint venture
agreement (JVA) that he purportedly entered into with the foreign corporation while he
was still its Area Sales Manager in the Philippines. The foreign corporation is not
licensed to do business in the Philippines, thus, a party to a contract with a foreign
corporation doing business in the Philippines without a license is not entitled to relief
from the latter; and

There is no pending civil or administrative case in SEC against Saag Phils., Inc. that
warrants the application of a prejudicial question and the consequent suspension of the
criminal action it has instituted against private respondent. If any, the action before the
SEC was merely a ploy to delay the resolution of the criminal case and eventually
frustrate the outcome of the estafa case.

HELD: YES

In sum, the main issue is whether or not a prejudicial question exists to warrant the suspension
of the criminal proceedings pending the resolution of the intra-corporate controversy that was
originally filed with the SEC.

A prejudicial question is defined as that which arises in a case, the resolution of which is a
logical antecedent of the issue involved therein and the cognizance of which pertains to another
tribunal. Here, the case which was lodged originally before the SEC and which is now pending
before the RTC of Mandaluyong City by virtue of Republic Act No. 8799 involves facts that are
intimately related to those upon which the criminal prosecution is based.

Ultimately, the resolution of the issues raised in the intra-corporate dispute will determine the
guilt or innocence of private respondent in the crime of estafa filed against him by petitioner
before the RTC of Makati. As correctly stated by the CA, one of the elements of the crime of
estafa with abuse of confidence under Article 315, par. 1(b) of the Revised Penal Code is a
demand made by the offended party to the offender:

The elements of estafa with abuse of confidence under subdivision No. 1, par. (b) of Art. 315
are as follows:

1. That money, goods, or other personal property be received by the offender in trust, or
on commission, or for administration, or under any other obligation involving the duty to
make delivery of, or to return the same;

2. That there be misrepresentation or conversion of such money or property by the

offender, or denial on his part of such receipt;
 3. That such misappropriation or conversion or denial is to the prejudice of another; and

4. That there is a demand made by the offended party to the offender.

Logically, under the circumstances, since the alleged offended party is Saag Phils., Inc., the
validity of the demand for the delivery of the subject vehicles rests upon the authority of the
person making such a demand on the company’s behalf. Private respondent is challenging
petitioner’s authority to act for Saag Phils., Inc. in the corporate case pending before the RTC of
Mandaluyong, Branch 214. Taken in this light, if the supposed authority of petitioner is found to
be defective, it is as if no demand was ever made, hence, the prosecution for estafa cannot
prosper. Moreover, the mere failure to return the thing received for safekeeping or on
commission, or for administration, or under any other obligation involving the duty to deliver or
to return the same or deliver the value thereof to the owner could only give rise to a civil action
and does not constitute the crime of estafa. This is because the crime is committed by
misappropriating or converting money or goods received by the offender under a lawful
transaction. As stated in the case of United States v. Bleibel:

The crime of estafa is not committed by the failure to return the things received for sale on
commission, or to deliver their value, but, as this class of crime is defined by law, by
misappropriating or converting the money or goods received on commission. Delay in the
fulfillment of a commission or in the delivery of the sum on such account received only involves
civil liability. So long as the money that a person is under obligation to deliver is not demanded
of him, and he fails to deliver it for having wrongfully disposed of it, there is no estafa, whatever
be the cause of the debt.

Likewise, by analogy, the doctrine of primary jurisdiction may be applied in this case. The issues
raised by petitioner particularly the status of Saag Phils., Inc. vis-à-vis Saag (S) Pte. Ltd., as
well as the question regarding the supposed authority of the latter to make a demand on behalf
of the company, are proper subjects for the determination of the tribunal hearing the intra-
corporate case which in this case is the RTC of Mandaluyong, Branch 214. These issues would
have been referred to the expertise of the SEC in accordance with the doctrine of primary
jurisdiction had the case not been transferred to the RTC of Mandaluyong.

Strictly speaking, the objective of the doctrine of primary jurisdiction is to guide a court in
determining whether it should refrain from exercising its jurisdiction until after an administrative
agency has determined some question or some aspect of some question arising in the
proceeding before the court. The court cannot or will not determine a controversy involving a
question which is within the jurisdiction of the administrative tribunal prior to resolving the same,
where the question demands the exercise of sound administrative discretion requiring special
knowledge, experience and services in determining technical and intricate matters of fact.

While the above doctrine refers specifically to an administrative tribunal, the Court believes that
the circumstances in the instant case do not proscribe the application of the doctrine, as the role
of an administrative tribunal such as the SEC in determining technical and intricate matters of
special competence has been taken on by specially designated RTCs by virtue of Republic Act
No. 8799. Hence, the RTC of Mandaluyong where the intra-corporate case is pending has the
primary jurisdiction to determine the issues under contention relating to the status of the
domestic corporation, Saag Phils., Inc., vis-à-vis Saag Pte. Ltd.; and the authority of petitioner to
act on behalf of the domestic corporation, the determination of which will have a direct bearing
on the criminal case. The law recognizes that, in place of the SEC, the regular courts now have
the legal competence to decide intra-corporate disputes.

In view of the foregoing, the Court finds no substantial basis in petitioner’s contention that the
CA committed grave abuse of discretion amounting to lack or excess of jurisdiction. Absent a
showing of a despotic, whimsical and arbitrary exercise of power by the CA, the petition must
fail.

WHEREFORE, the petition is DISMISSED. The decision and resolution of the Court of Appeals
in CA-G.R. SP No. 55834, dated June 30, 2000 and March 5, 2001, respectively, are
AFFIRMED. No costs.
PEOPLE OF THE PHILIPPINES, Petitioner,
vs.
VICTORIA R. ARAMBULO and MIGUELARAMBULO, JR., Respondents.
G.R. No. 186597 June 17, 2015 FIRST DIVISION PEREZ, J.:

FACTS:

Respondent Victoria Arambulo (Victoria), Gungab, Reynaldo, Domingo Reyes,Rodrigo Reyes

and Oscar Reyes are the heirs of Sps Pedro Reyes and Anastacia Reyes. Anaped Estate, Inc.
(Anaped) was incorporated as part of the estate planning or as conduit to hold the properties of
the estate of Pedro Reyes for andin behalf of his heirs.

(Buban), as Vice-President and General Manager of Anaped Estate, Inc. (Anaped),led a

complaint for estafa against Victoria and her husband Miguel Arambulo, Jr.(Miguel) before the O
ce of the City Prosecutor of Caloocan City. He alleged thatVictoria failed to remit the rentals
collected from the time the ownership of the commercial apartments was transferred to Anaped.

Respondents filed MR to Suspend Proceedings on the ground of a prejudicialquestion in view of

the pendency of the two intra-corporate cases pending before the RTC QC and Makati.

SEC Case No. 05-97-5659 is a petition led by Victoria's brother Oscar for accounting of all
corporate funds and assets of Anaped, annulment of sale, injunction, receivership and damages

SEC Case No. 03-99-6259 is a petition led by Victoria and her brothers Reynaldo and Domingo
questioning the authority of their elder sibling Rodrigo Reyes and Emerenciana R. Gungab,
&Anaped Board of Directors and officers, including private complainant Buban to act for and in
behalf of the corporation.

In their motion to suspend proceedings, respondents asserted that the resolution of the SEC
cases in their favor particularly the issues of whether of the group of Rodrigo and Buban are the
lawful representatives of the corporation and whether they are duly authorized to make a
demand for remittance would necessarily result in their acquittal in the criminal case.
TC granted motion. Set aside its order, and set the case for pre-trial.

Respondents filed an Omnibus Motion praying that they be allowed to file Comment/Opposition
to the MR and that pre-trial be held in abeyance. TC Denied.

Respondents appealed to CA, granted.

CA concluded that if the supposed authority of Buban is found to be defective, it is as if no

demand was ever made, hence the prosecution forestafa cannot prosper. MR denied.

ISSUE: W/N there is a prejudicial question? Yes, in the 2nd SEC Case.

HELD:
Petitioner argues that any decision of the trial court in the SEC cases with respectto the
question of who are the lawful officers or directors of Anaped is not determinative of the liability
of respondents to remit the rental collections in favor of Anaped. Petitioner proffers that a
corporation has a personality distinct and separate from its individual stockholders. Petitioner
emphasizes that at the time the demand for remittance of the rental collections was made
against respondents, Buban was an officer of Anaped and until such time that his authority
is validly revoked, all his previous acts are valid and binding. Moreover, petitioner avers that the
duty of respondents to remit the collection still subsists even during the pendency of the SEC
cases as the money remitted goes directly to the corporation and not to the person who
demanded the remittance. Finally, petitioner opines that question pertaining to the authority of
Buban to demand remittance may onlybe considered as a defense in the estafa case and not as
a ground to suspend the proceedings.

A prejudicial question is one that arises in a case the resolution of which is a logical antecedent
of the issue involved therein, and the cognizance of which pertains to another tribunal. It is a
question based on a fact distinct and separate from the crime but so intimately connected with
it that it determines the guilt or innocence of the accused, and for it to suspend the criminal
action, it must appear not only that said case involves facts intimately related to those upon
which the criminal prosecution would be based but also that in the resolution of the issue or
issues raised in the civil case, the guilt or innocence of the accused would necessarily be
determined.

Section 7. Elements of prejudicial question.

The elements of a prejudicial question are: (a) the previously instituted civil action involves an
issue similar or intimately related to the issue raised in the subsequent criminal action, and (b)
the resolution of such issue determines whether or not the criminal action may proceed.

Aptly put, the following requisites must be present for a civil action to be considered prejudicial
to a criminal case as to cause the suspension of the criminal proceedings until the final
resolution of the civil case: (1) the civil case involves facts intimately related to those upon which
the criminal prosecution would be based; (2) in the resolution of the issue or issues raised in the
civil action, the guilt or innocence of the accused would necessarily be determined; and (3)
jurisdiction to try said question must be lodged in another tribunal.

SEC Case No. 05-97-5659 does not present a prejudicial question to the criminal case for
estafa. It is an action for accounting of all corporate funds and assets o fAnaped, annulment of
sale, injunction, receivership and damages.

Even if said case will be decided against respondents, they will not be adjudged free from
criminal liability. It also does not automatically follow that an accounting of corporate funds and
properties and annulment of fictitious sale of corporate assets would result in the conviction
of respondents in the estafa case.
SEC Case No. 03-99-6259, however, we affirm the Court of Appeals' finding that a prejudicial
question exists.

The Complaint in SEC Case No. 03- 99-6259 prays for the nullification of the election of Anaped
directors and officers, including Buban. Essentially, the issue is the authority of the aforesaid
officers to act for and behalf of the corporation.
SPOUSES ALEXANDER TRINIDAD and CECILIA TRINIDAD, Petitioners,
vs.
VICTOR ANG, Respondent.
G.R. No. 192898 January 31, 2011 THIRD DIVISION BRION, J.:

FACTS:

On September 3, 2007, the Office of the City Prosecutor, Masbate City, issued a Resolution
recommending the filing of an Information for Violation of Batas Pambansa Bilang 22 against
the petitioners. Petitioners the filed with the DOJ a motion for review. On March 3, 2009 the
prosecutor then filed the information with the MTcC who later on ordered the petitioners to file
their counter affidavit. The petitioners filed a

Manifestation and Motion to Defer Arraignment and Proceedings and Hold in Abeyance the
Issuance of Warrants of Arrest praying, among others, for the deferment of their arraignment in
view of the pendency of their petition for review before the DOJ. The MTCC granted the motion
subject to par c, section 11 rule 116 and set their arraignment on September 10, 2009. A
petition for certiorari was then made to the RTC who held that the MTCC judge did not err in
setting the arraignment of the petitioners after the lapse of one (1) year and ten (10) months
from the filing of the petition for review with the DOJ. The petitioners then filed with the SC a
petition for review on certiorari essentially claiming that the 60-day limit on suspension of
arraignment is only a general rule.

ISSUE:

WON the motion for review is a ground for suspension of arraignment.

HELD: Yes. SC granted the motion for reconsideration and reinstate the petition for review on
certiorari.The grounds for suspension of arraignment are provided under Section 11, Rule 116
of the Rules of Court, which provides:

SEC. 11.

Suspension of Arraignment . - Upon motion by the proper party, the arraignment shall be
suspended in the following cases:(a) The accused appears to be suffering from an unsound
mental condition which effectively renders him unable to fully understand the charge against him
and to plead intelligently thereto. In such case, the court shall order his mental examination and,
if necessary, his confinement for such purpose;(b) There exists a prejudicial question; and(c) A
petition for review of the resolution of the prosecutor is pending at either the Department of
Justice, or the Office of the President; Provided , that the period of suspension shall not exceed
sixty (60) days counted from the filing of the petition with the reviewing office. In Samson v.
Daway, the Court explained that while the pendency of a petition for review is aground for
suspension of the arraignment, the a forecited provision limits the deferment of the arraignment
to a period of 60 days reckoned from the filing of the petition with the reviewing office. It follows,
therefore, that after the expiration of said period, the trial court is bound to arraign the accused
or to deny the motion to defer arraignment.