Republic v. Sandiganbayan

EN BANC (1)
Azio-Verso-Vibur Foundation accounts;

[G.R. No. 152154. July 15, 2003]
(2) Xandy-Wintrop: Charis-Scolari-Valamo-Spinus- Avertina
REPUBLIC OF THE PHILIPPINES, petitioner, vs. HONORABLE Foundation accounts;
SANDIGANBAYAN (SPECIAL FIRST DIVISION),
FERDINAND E. MARCOS (REPRESENTED BY HIS (3) Trinidad-Rayby-Palmy Foundation accounts;
ESTATE/HEIRS: IMELDA R. MARCOS, MARIA IMELDA
[IMEE] MARCOS-MANOTOC, FERDINAND R. MARCOS, (4) Rosalys-Aguamina Foundation accounts and
JR. AND IRENE MARCOS-ARANETA) AND IMELDA
ROMUALDEZ MARCOS, respondents. (5) Maler Foundation accounts.
DECISION In addition, the petition sought the forfeiture of US$25 million and
CORONA, J.: US$5 million in treasury notes which exceeded the Marcos couples
salaries, other lawful income as well as income from legitimately
This is a petition for certiorari under Rule 65 of the Rules of Court acquired property. The treasury notes are frozen at the Central Bank
seeking to (1) set aside the Resolution dated January 31, 2002 issued of the Philippines, now Bangko Sentral ng Pilipinas, by virtue of the
by the Special First Division of the Sandiganbayan in Civil Case No. freeze order issued by the PCGG.
0141 entitled Republic of the Philippines vs. Ferdinand E. Marcos, et. On October 18, 1993, respondents Imelda R. Marcos, Maria
al., and (2) reinstate its earlier decision dated September 19, 2000 Imelda M. Manotoc, Irene M. Araneta and Ferdinand R. Marcos, Jr.
which forfeited in favor of petitioner Republic of the Philippines filed their answer.
(Republic) the amount held in escrow in the Philippine National Bank
(PNB) in the aggregate amount of US$658,175,373.60 as of January Before the case was set for pre-trial, a General Agreement and
31, 2002. the Supplemental Agreements[6] dated December 28, 1993 were
executed by the Marcos children and then PCGG Chairman
Magtanggol Gunigundo for a global settlement of the assets of the
Marcos family. Subsequently, respondent Marcos children filed a
BACKGROUND OF THE CASE
motion dated December 7, 1995 for the approval of said agreements
and for the enforcement thereof.
On December 17, 1991, petitioner Republic, through the The General Agreement/Supplemental Agreements sought to
Presidential Commission on Good Government (PCGG), represented identify, collate, cause the inventory of and distribute all assets
by the Office of the Solicitor General (OSG), filed a petition for presumed to be owned by the Marcos family under the conditions
forfeiture before the Sandiganbayan, docketed as Civil Case No. 0141 contained therein. The aforementioned General Agreement specified
entitled Republic of the Philippines vs. Ferdinand E. Marcos, in one of its premises or whereas clauses the fact that petitioner
represented by his Estate/Heirs and Imelda R. Marcos, pursuant to obtained a judgment from the Swiss Federal Tribunal on December
RA 1379[1] in relation to Executive Order Nos. 1,[2] 2,[3] 14[4] and 14-A.[5] 21, 1990, that the Three Hundred Fifty-six Million U.S. dollars
In said case, petitioner sought the declaration of the aggregate (US$356 million) belongs in principle to the Republic of the Philippines
amount of US$356 million (now estimated to be more than US$658 provided certain conditionalities are met x x x. The said decision of the
million inclusive of interest) deposited in escrow in the PNB, as ill- Swiss Federal Supreme Court affirmed the decision of Zurich District
gotten wealth. The funds were previously held by the following five Attorney Peter Consandey, granting petitioners request for legal
account groups, using various foreign foundations in certain Swiss assistance.[7] Consandey declared the various deposits in the name of
banks: the enumerated foundations to be of illegal provenance and ordered
that they be frozen to await the final verdict in favor of the parties THE ESSENTIAL FACTS WHICH WARRANT THE FORFEITURE OF
entitled to restitution. THE FUNDS SUBJECT OF THE PETITION UNDER R.A. NO. 1379 ARE
ADMITTED BY RESPONDENTS IN THEIR PLEADINGS AND OTHER
Hearings were conducted by the Sandiganbayan on the motion to SUBMISSIONS MADE IN THE COURSE OF THE PROCEEDING.
approve the General/Supplemental Agreements. Respondent
Ferdinand, Jr. was presented as witness for the purpose of
II
establishing the partial implementation of said agreements.
On October 18, 1996, petitioner filed a motion for summary judgment RESPONDENTS ADMISSION MADE DURING THE PRE-TRIAL THAT
and/or judgment on the pleadings. Respondent Mrs. Marcos filed her THEY DO NOT HAVE ANY INTEREST OR OWNERSHIP OVER THE
opposition thereto which was later adopted by respondents Mrs. FUNDS SUBJECT OF THE ACTION FOR FORFEITURE TENDERS NO
Manotoc, Mrs. Araneta and Ferdinand, Jr. GENUINE ISSUE OR CONTROVERSY AS TO ANY MATERIAL FACT
IN THE PRESENT ACTION, THUS WARRANTING THE RENDITION
In its resolution dated November 20, 1997, the Sandiganbayan
OF SUMMARY JUDGMENT.[8]
denied petitioners motion for summary judgment and/or judgment on
the pleadings on the ground that the motion to approve the
compromise agreement (took) precedence over the motion for Petitioner contended that, after the pre-trial conference, certain
summary judgment. facts were established, warranting a summary judgment on the funds
sought to be forfeited.
Respondent Mrs. Marcos filed a manifestation on May 26, 1998
claiming she was not a party to the motion for approval of the Respondent Mrs. Marcos filed her opposition to the petitioners
Compromise Agreement and that she owned 90% of the funds with motion for summary judgment, which opposition was later adopted by
the remaining 10% belonging to the Marcos estate. her co-respondents Mrs. Manotoc, Mrs. Araneta and Ferdinand, Jr.
Meanwhile, on August 10, 1995, petitioner filed with the District On March 24, 2000, a hearing on the motion for summary
Attorney in Zurich, Switzerland, an additional request for the judgment was conducted.
immediate transfer of the deposits to an escrow account in the In a decision[9] dated September 19, 2000, the Sandiganbayan
PNB. The request was granted. On appeal by the Marcoses, the granted petitioners motion for summary judgment:
Swiss Federal Supreme Court, in a decision dated December 10,
1997, upheld the ruling of the District Attorney of Zurich granting the CONCLUSION
request for the transfer of the funds. In 1998, the funds were remitted
to the Philippines in escrow. Subsequently, respondent Marcos There is no issue of fact which calls for the presentation of evidence.
children moved that the funds be placed in custodia legis because the
deposit in escrow in the PNB was allegedly in danger of dissipation by
The Motion for Summary Judgment is hereby granted.
petitioner. The Sandiganbayan, in its resolution dated September 8,
1998, granted the motion.
The Swiss deposits which were transmitted to and now held in escrow at the
After the pre-trial and the issuance of the pre-trial order and PNB are deemed unlawfully acquired as ill-gotten wealth.
supplemental pre-trial order dated October 28, 1999 and January 21,
2000, respectively, the case was set for trial. After several resettings, DISPOSITION
petitioner, on March 10, 2000, filed another motion for summary
judgment pertaining to the forfeiture of the US$356 million, based on WHEREFORE, judgment is hereby rendered in favor of the Republic of the
the following grounds: Philippines and against the respondents, declaring the Swiss deposits which
I were transferred to and now deposited in escrow at the Philippine National
Bank in the total aggregate value equivalent to US$627,608,544.95 as of
August 31, 2000 together with the increments thereof forfeited in favor of the FERDINAND E. MARCOS AND IMELDA R. MARCOS
State.[10] AS PUBLIC OFFICIALS BUT ALSO THE EXTENT OF
THEIR SALARIES AS SUCH PUBLIC OFFICIALS, WHO
Respondent Mrs. Marcos filed a motion for reconsideration dated UNDER THE CONSTITUTION, WERE PROHIBITED
September 26, 2000. Likewise, Mrs. Manotoc and Ferdinand, Jr. filed FROM ENGAGING IN THE MANAGEMENT OF
their own motion for reconsideration dated October 5, 2000. Mrs. FOUNDATIONS.
Araneta filed a manifestation dated October 4, 2000 adopting the
motion for reconsideration of Mrs. Marcos, Mrs. Manotoc and B. PRIVATE RESPONDENTS ALSO ADMITTED THE
Ferdinand, Jr. EXISTENCE OF THE SWISS DEPOSITS AND THEIR
OWNERSHIP THEREOF:
Subsequently, petitioner filed its opposition thereto.
In a resolution[11] dated January 31, 2002, the Sandiganbayan 1. ADMISSIONS IN PRIVATE RESPONDENTS ANSWER;
reversed its September 19, 2000 decision, thus denying petitioners
motion for summary judgment: 2. ADMISSION IN THE GENERAL / SUPPLEMENTAL
AGREEMENTS THEY SIGNED AND SOUGHT
CONCLUSION TO IMPLEMENT;
In sum, the evidence offered for summary judgment of the case did not prove 3. ADMISSION IN A MANIFESTATION OF PRIVATE
that the money in the Swiss Banks belonged to the Marcos spouses because RESPONDENT IMELDA R. MARCOS AND IN
no legal proof exists in the record as to the ownership by the Marcoses of the THE MOTION TO PLACE
funds in escrow from the Swiss Banks. THE RES IN CUSTODIA LEGIS; AND
The basis for the forfeiture in favor of the government cannot be deemed to 4. ADMISSION IN THE UNDERTAKING TO PAY THE
have been established and our judgment thereon, perforce, must also have HUMAN RIGHTS VICTIMS.
been without basis.
C. PETITIONER HAS PROVED THE EXTENT OF THE
WHEREFORE, the decision of this Court dated September 19, 2000 is LEGITIMATE INCOME OF FERDINAND E. MARCOS
reconsidered and set aside, and this case is now being set for further AND IMELDA R. MARCOS AS PUBLIC OFFICIALS.
proceedings.[12]
D. PETITIONER HAS ESTABLISHED A PRIMA
Hence, the instant petition. In filing the same, petitioner argues FACIE PRESUMPTION OF UNLAWFULLY ACQUIRED
that the Sandiganbayan, in reversing its September 19, 2000 WEALTH.
decision, committed grave abuse of discretion amounting to lack or
excess of jurisdiction considering that -- II
I
SUMMARY JUDGMENT IS PROPER SINCE PRIVATE RESPONDENTS
HAVE NOT RAISED ANY GENUINE ISSUE OF FACT CONSIDERING
PETITIONER WAS ABLE TO PROVE ITS CASE IN ACCORDANCE
THAT:
WITH THE REQUISITES OF SECTIONS 2 AND 3 OF R.A. NO. 1379:
A. PRIVATE RESPONDENTS DEFENSE THAT SWISS
A. PRIVATE RESPONDENTS CATEGORICALLY ADMITTED
DEPOSITS WERE LAWFULLY ACQUIRED DOES NOT
NOT ONLY THE PERSONAL CIRCUMSTANCES OF
ONLY FAIL TO TENDER AN ISSUE BUT IS CLEARLY particular issue relating to the translation of the Swiss court decisions
A SHAM; AND could not be resurrected anymore because said decisions had been
previously utilized by the Sandiganbayan itself in resolving a decisive
B. IN SUBSEQUENTLY DISCLAIMING OWNERSHIP OF THE issue before it.
SWISS DEPOSITS, PRIVATE RESPONDENTS
Petitioner faults the Sandiganbayan for questioning the non-
ABANDONED THEIR SHAM DEFENSE OF LEGITIMATE
production of the authenticated translations of the Swiss Federal
ACQUISITION, AND THIS FURTHER JUSTIFIED THE
Supreme Court decisions as this was a marginal and technical matter
RENDITION OF A SUMMARY JUDGMENT.
that did not diminish by any measure the conclusiveness and strength
of what had been proven and admitted before the Sandiganbayan,
III that is, that the funds deposited by the Marcoses constituted ill-gotten
wealth and thus belonged to the Filipino people.
THE FOREIGN FOUNDATIONS NEED NOT BE IMPLEADED.
In compliance with the order of this Court, Mrs. Marcos filed her
IV comment to the petition on May 22, 2002. After several motions for
extension which were all granted, the comment of Mrs. Manotoc and
THE HONORABLE PRESIDING JUSTICE COMMITTED GRAVE Ferdinand, Jr. and the separate comment of Mrs. Araneta were filed
ABUSE OF DISCRETION IN REVERSING HIMSELF ON THE on May 27, 2002.
GROUND THAT ORIGINAL COPIES OF THE AUTHENTICATED Mrs. Marcos asserts that the petition should be denied on the
SWISS DECISIONS AND THEIR AUTHENTICATED TRANSLATIONS following grounds:
HAVE NOT BEEN SUBMITTED TO THE COURT, WHEN EARLIER
THE SANDIGANBAYAN HAS QUOTED EXTENSIVELY A PORTION A.
OF THE TRANSLATION OF ONE OF THESE SWISS DECISIONS IN
HIS PONENCIA DATED JULY 29, 1999 WHEN IT DENIED THE PETITIONER HAS A PLAIN, SPEEDY, AND ADEQUATE REMEDY AT
MOTION TO RELEASE ONE HUNDRED FIFTY MILLION US THE SANDIGANBAYAN.
DOLLARS ($150,000,000.00) TO THE HUMAN RIGHTS VICTIMS.
B.
V
THE SANDIGANBAYAN DID NOT ABUSE ITS DISCRETION IN
PRIVATE RESPONDENTS ARE DEEMED TO HAVE WAIVED THEIR SETTING THE CASE FOR FURTHER PROCEEDINGS.[14]
OBJECTION TO THE AUTHENTICITY OF THE SWISS FEDERAL
SUPREME COURT DECISIONS.[13] Mrs. Marcos contends that petitioner has a plain, speedy and
adequate remedy in the ordinary course of law in view of the
Petitioner, in the main, asserts that nowhere in the respondents resolution of the Sandiganbayan dated January 31, 2000 directing
motions for reconsideration and supplemental motion for petitioner to submit the authenticated translations of the Swiss
reconsideration were the authenticity, accuracy and admissibility of decisions. Instead of availing of said remedy, petitioner now elevates
the Swiss decisions ever challenged. Otherwise stated, it was the matter to this Court. According to Mrs. Marcos, a petition for
incorrect for the Sandiganbayan to use the issue of lack of certiorari which does not comply with the requirements of the rules
authenticated translations of the decisions of the Swiss Federal may be dismissed. Since petitioner has a plain, speedy and adequate
Supreme Court as the basis for reversing itself because respondents remedy, that is, to proceed to trial and submit authenticated
themselves never raised this issue in their motions for reconsideration translations of the Swiss decisions, its petition before this Court must
and supplemental motion for reconsideration. Furthermore, this be dismissed. Corollarily, the Sandiganbayans ruling to set the case
for further proceedings cannot and should not be considered a property which the Marcos couple allegedly acquired during
capricious and whimsical exercise of judgment. their incumbency.
Likewise, Mrs. Manotoc and Ferdinand, Jr., in their comment,
(a) Petitioner has failed to prove that the Marcos couple
prayed for the dismissal of the petition on the grounds that:
acquired or own the Swiss funds.
(A)
(b) Even assuming, for the sake of argument, that the fact of
BY THE TIME PETITIONER FILED ITS MOTION FOR SUMMARY acquisition has been proven, petitioner has
JUDGMENT ON 10 MARCH 2000, IT WAS ALREADY BARRED FROM categorically admitted that it has no evidence
DOING SO. showing how much of the Swiss funds was acquired
during the incumbency of the Marcos couple from
(1) The Motion for Summary Judgment was based on private 31 December 1965 to 25 February 1986.
respondents Answer and other documents that had long been
in the records of the case. Thus, by the time the Motion was (3) In contravention of the essential element stated in Section 3 (e)
filed on 10 March 2000, estoppel by laches had already set of R.A. 1379, petitioner has failed to establish the other
in against petitioner. proper earnings and income from legitimately acquired
property of the Marcos couple over and above their
(2) By its positive acts and express admissions prior to filing the government salaries.
Motion for Summary Judgment on 10 March 1990,
petitioner had legally bound itself to go to trial on the basis (4) Since petitioner failed to prove the three essential elements
of existing issues. Thus, it clearly waived whatever right it provided in paragraphs (c)[15] (d),[16] and (e)[17] of Section 3,
had to move for summary judgment. R.A. 1379, the inescapable conclusion is that the prima facie
presumption of unlawful acquisition of the Swiss funds has
(B) not yet attached. There can, therefore, be no premature
forfeiture of the funds.
EVEN ASSUMING THAT PETITIONER WAS NOT LEGALLY BARRED
FROM FILING THE MOTION FOR SUMMARY JUDGMENT, THE (C)
SANDIGANBAYAN IS CORRECT IN RULING THAT PETITIONER
HAS NOT YET ESTABLISHED A PRIMA FACIE CASE FOR THE IT WAS ONLY BY ARBITRARILY ISOLATING AND THEN TAKING
FORFEITURE OF THE SWISS FUNDS. CERTAIN STATEMENTS MADE BY PRIVATE RESPONDENTS OUT
OF CONTEXT THAT PETITIONER WAS ABLE TO TREAT THESE AS
(1) Republic Act No. 1379, the applicable law, is a penal statute. JUDICIAL ADMISSIONS SUFFICIENT TO ESTABLISH A PRIMA
As such, its provisions, particularly the essential elements FACIE AND THEREAFTER A CONCLUSIVE CASE TO JUSTIFY THE
stated in section 3 thereof, are mandatory in nature. These FORFEITURE OF THE SWISS FUNDS.
should be strictly construed against petitioner and liberally in
favor of private respondents. (1) Under Section 27, Rule 130 of the Rules of Court, the General
and Supplemental Agreements, as well as the other written
(2) Petitioner has failed to establish the third and fourth essential and testimonial statements submitted in relation thereto, are
elements in Section 3 of R.A. 1379 with respect to the expressly barred from being admissible in evidence against
identification, ownership, and approximate amount of the private respondents.
(2) Had petitioner bothered to weigh the alleged admissions assailing the Sandiganbayan Resolution dated January 21, 2002
together with the other statements on record, there would be should be threshed out.
a demonstrable showing that no such judicial admissions
were made by private respondents. At the outset, we would like to stress that we are treating this
case as an exception to the general rule governing petitions for
certiorari. Normally, decisions of the Sandiganbayan are brought
(D)
before this Court under Rule 45, not Rule 65. [20] But where the case is
undeniably ingrained with immense public interest, public policy and
SINCE PETITIONER HAS NOT (YET) PROVEN ALL THE ESSENTIAL deep historical repercussions, certiorari is allowed notwithstanding the
ELEMENTS TO ESTABLISH A PRIMA FACIE CASE FOR existence and availability of the remedy of appeal.[21]
FORFEITURE, AND PRIVATE RESPONDENTS HAVE NOT MADE
ANY JUDICIAL ADMISSION THAT WOULD HAVE FREED IT FROM One of the foremost concerns of the Aquino Government
ITS BURDEN OF PROOF, THE SANDIGANBAYAN DID NOT COMMIT in February 1986 was the recovery of the unexplained or ill-gotten
GRAVE ABUSE OF DISCRETION IN DENYING THE MOTION FOR wealth reputedly amassed by former President and Mrs. Ferdinand E.
SUMMARY JUDGMENT. CERTIORARI, THEREFORE, DOES NOT LIE, Marcos, their relatives, friends and business associates. Thus, the
ESPECIALLY AS THIS COURT IS NOT A TRIER OF FACTS.[18] very first Executive Order (EO) issued by then President Corazon
Aquino upon her assumption to office after the ouster of the Marcoses
For her part, Mrs. Araneta, in her comment to the petition, claims was EO No. 1, issued on February 28, 1986. It created the
that obviously petitioner is unable to comply with a very plain Presidential Commission on Good Government (PCGG) and charged
requirement of respondent Sandiganbayan. The instant petition is it with the task of assisting the President in the "recovery of all ill-
allegedly an attempt to elevate to this Court matters, issues and gotten wealth accumulated by former President Ferdinand E. Marcos,
incidents which should be properly threshed out at the his immediate family, relatives, subordinates and close associates,
Sandiganbayan. To respondent Mrs. Araneta, all other matters, save whether located in the Philippines or abroad, including the takeover or
that pertaining to the authentication of the translated Swiss Court sequestration of all business enterprises and entities owned or
decisions, are irrelevant and impertinent as far as this Court is controlled by them during his administration, directly or through
concerned. Respondent Mrs. Araneta manifests that she is as eager nominees, by taking undue advantage of their public office and/or
as respondent Sandiganbayan or any interested person to have the using their powers, authority, influence, connections or
Swiss Court decisions officially translated in our known language. She relationship." The urgency of this undertaking was tersely described
says the authenticated official English version of the Swiss Court by this Court in Republic vs. Lobregat[22]:
decisions should be presented. This should stop all speculations on
what indeed is contained therein. Thus, respondent Mrs. Araneta surely x x x an enterprise "of great pith and moment"; it was attended by
prays that the petition be denied for lack of merit and for raising "great expectations"; it was initiated not only out of considerations of simple
matters which, in elaborated fashion, are impertinent and improper justice but also out of sheer necessity - the national coffers were empty, or
before this Court. nearly so.
In all the alleged ill-gotten wealth cases filed by the PCGG, this
PROPRIETY OF PETITIONERS Court has seen fit to set aside technicalities and formalities that
ACTION FOR CERTIORARI merely serve to delay or impede judicious resolution. This Court
prefers to have such cases resolved on the merits at the
Sandiganbayan. But substantial justice to the Filipino people and to all
But before this Court discusses the more relevant issues, the parties concerned, not mere legalisms or perfection of form, should
question regarding the propriety of petitioner Republic's action for now be relentlessly and firmly pursued. Almost two decades have
certiorari under Rule 65[19] of the 1997 Rules of Civil Procedure passed since the government initiated its search for and reversion of
such ill-gotten wealth. The definitive resolution of such cases on the Summary judgment is proper when there is clearly no genuine
merits is thus long overdue. If there is proof of illegal acquisition, issue as to any material fact in the action. [26] The theory of summary
accumulation, misappropriation, fraud or illicit conduct, let it be judgment is that, although an answer may on its face appear to tender
brought out now. Let the ownership of these funds and other assets issues requiring trial, if it is demonstrated by affidavits, depositions or
be finally determined and resolved with dispatch, free from all the admissions that those issues are not genuine but sham or fictitious,
delaying technicalities and annoying procedural sidetracks.[23] the Court is justified in dispensing with the trial and rendering
summary judgment for petitioner Republic.
We thus take cognizance of this case and settle with finality all
the issues therein. The Solicitor General made a very thorough presentation of its
case for forfeiture:
ISSUES BEFORE THIS COURT xxx
4. Respondent Ferdinand E. Marcos (now deceased and represented by his

The crucial issues which this Court must resolve are: (1) whether Estate/Heirs) was a public officer for several decades continuously and
or not respondents raised any genuine issue of fact which would without interruption as Congressman, Senator, Senate President and
either justify or negate summary judgment; and (2) whether or not President of the Republic of the Philippines from December 31, 1965 up to
petitioner Republic was able to prove its case for forfeiture in his ouster by direct action of the people of EDSA on February 22-25, 1986.
accordance with Sections 2 and 3 of RA 1379.
(1) THE PROPRIETY OF SUMMARY JUDGMENT 5. Respondent Imelda Romualdez Marcos (Imelda, for short) the former First
Lady who ruled with FM during the 14-year martial law regime, occupied the
We hold that respondent Marcoses failed to raise any genuine position of Minister of Human Settlements from June 1976 up to the peaceful
issue of fact in their pleadings. Thus, on motion of petitioner Republic, revolution in February 22-25, 1986. She likewise served once as a member of
summary judgment should take place as a matter of right. the Interim Batasang Pambansa during the early years of martial law from
In the early case of Auman vs. Estenzo[24], summary judgment 1978 to 1984 and as Metro Manila Governor in concurrent capacity as
was described as a judgment which a court may render before trial Minister of Human Settlements. x x x
but after both parties have pleaded. It is ordered by the court upon
application by one party, supported by affidavits, depositions or other xxx xxx xxx
documents, with notice upon the adverse party who may in turn file an
opposition supported also by affidavits, depositions or other 11. At the outset, however, it must be pointed out that based on the Official
documents. This is after the court summarily hears both parties with Report of the Minister of Budget, the total salaries of former President
their respective proofs and finds that there is no genuine issue Marcos as President form 1966 to 1976 was P60,000 a year and from 1977 to
between them. Summary judgment is sanctioned in this jurisdiction by 1985, P100,000 a year; while that of the former First Lady, Imelda R.
Section 1, Rule 35 of the 1997 Rules of Civil Procedure: Marcos, as Minister of Human Settlements from June 1976 to February 22-
25, 1986 was P75,000 a year xxx.
SECTION 1. Summary judgment for claimant.- A party seeking to recover
upon a claim, counterclaim, or cross-claim or to obtain a declaratory relief ANALYSIS OF RESPONDENTS
may, at any time after the pleading in answer thereto has been served, move LEGITIMATE INCOME
with supporting affidavits, depositions or admissions for a summary
judgment in his favor upon all or any part thereof.[25] xxx
12. Based on available documents, the ITRs of the Marcoses for the years Corporation, National Food Authority Council, Light Rail Transit Authority
1965-1975 were filed under Tax Identification No. 1365-055-1. For the years and Home Development Mutual Fund.
1976 until 1984, the returns were filed under Tax Identification No. M 6221-
J 1117-A-9. 16. Of the P11,109,836.00 in reported income from legal practice, the
amount of P10,649,836.00 or 96% represents receivables from prior years
13. The data contained in the ITRs and Balance Sheet filed by the Marcoses during the period 1967 up to 1984.
are summarized and attached to the reports in the following schedules:
17. In the guise of reporting income using the cash method under Section 38
Schedule A: of the National Internal Revenue Code, FM made it appear that he had an
extremely profitable legal practice before he became a President (FM being
Schedule of Income (Annex T hereof); barred by law from practicing his law profession during his entire
presidency) and that, incredibly, he was still receiving payments almost 20
Schedule B: years after. The only problem is that in his Balance Sheet attached to his
1965 ITR immediately preceeding his ascendancy to the presidency he did
Schedule of Income Tax Paid (Annex T-1 hereof); not show any Receivables from client at all, much less the P10,65-M that he
decided to later recognize as income. There are no documents showing any
Schedule C: withholding tax certificates. Likewise, there is nothing on record that will
show any known Marcos client as he has no known law office. As previously
stated, his networth was a mere P120,000.00 in December, 1965. The joint
Schedule of Net Disposable Income (Annex T-2 hereof);
income tax returns of FM and Imelda cannot, therefore, conceal the skeletons
of their kleptocracy.
Schedule D:
18. FM reported a total of P2,521,325.00 as Other Income for the years 1972
Schedule of Networth Analysis (Annex T-3 hereof). up to 1976 which he referred to in his return as Miscellaneous Items and
Various Corporations. There is no indication of any payor of the dividends or
14. As summarized in Schedule A (Annex T hereof), the Marcoses earnings.
reported P16,408,442.00 or US$2,414,484.91 in total income over a period
of 20 years from 1965 to 1984. The sources of income are as follows: 19. Spouses Ferdinand and Imelda did not declare any income from any
deposits and placements which are subject to a 5% withholding tax. The
Official Salaries - P 2,627,581.00 - 16.01% Bureau of Internal Revenue attested that after a diligent search of pertinent
Legal Practice - 11,109,836.00 - 67.71% records on file with the Records Division, they did not find any records
Farm Income - 149,700.00 - .91% involving the tax transactions of spouses Ferdinand and Imelda in Revenue
Others - 2,521,325.00 - 15.37% Region No. 1, Baguio City, Revenue Region No.4A, Manila, Revenue
Total P16,408,442.00 - 100.00% Region No. 4B1, Quezon City and Revenue No. 8, Tacloban,
Leyte. Likewise, the Office of the Revenue Collector of Batac. Further, BIR
15. FMs official salary pertains to his compensation as Senate President in attested that no records were found on any filing of capital gains tax return
1965 in the amount of P15,935.00 and P1,420,000.00 as President of the involving spouses FM and Imelda covering the years 1960 to 1965.
Philippines during the period 1966 until 1984. On the other hand, Imelda
reported salaries and allowances only for the years 1979 to 1984 in the 20. In Schedule B, the taxable reported income over the twenty-year period
amount of P1,191,646.00. The records indicate that the reported income was P14,463,595.00 which represents 88% of the gross income. The
came from her salary from the Ministry of Human Settlements and Marcoses paid income taxes totaling P8,233,296.00 or US$1,220,667.59. The
allowances from Food Terminal, Inc., National Home Mortgage Finance business expenses in the amount of P861,748.00 represent expenses incurred
for subscription, postage, stationeries and contributions while the other 24. On June 11, 1971, Ferdinand Marcos issued a written order to Dr. Theo
deductions in the amount of P567,097.00 represents interest charges, Bertheau, legal counsel of Schweizeresche Kreditanstalt or SKA, also known
medicare fees, taxes and licenses. The total deductions in the amount as Swiss Credit Bank, for him to establish the AZIO Foundation. On the
of P1,994,845.00 represents 12% of the total gross income. same date, Marcos executed a power of attorney in favor of Roberto S.
Benedicto empowering him to transact business in behalf of the said
21. In Schedule C, the net cumulative disposable income amounts foundation. Pursuant to the said Marcos mandate, AZIO Foundation was
to P6,756,301.00 or US$980,709.77. This is the amount that represents that formed on June 21, 1971 in Vaduz. Walter Fessler and Ernst Scheller, also of
portion of the Marcoses income that is free for consumption, savings and SKA Legal Service, and Dr. Helmuth Merling from Schaan were designated
investments. The amount is arrived at by adding back to the net income after as members of the Board of Trustees of the said foundation. Ferdinand
tax the personal and additional exemptions for the years 1965-1984, as well Marcos was named first beneficiary and the Marcos Foundation, Inc.
as the tax-exempt salary of the President for the years 1966 until 1972. was second beneficiary. On November 12, 1971, FM again issued another
written order naming Austrahil PTY Ltd. In Sydney, Australia, as the
22. Finally, the networth analysis in Schedule D, represents the total foundations first and sole beneficiary. This was recorded on December 14,
accumulated networth of spouses, Ferdinand and Imelda. Respondents 1971.
Balance Sheet attached to their 1965 ITR, covering the year immediately
preceding their ascendancy to the presidency, indicates an ending networth 25. In an undated instrument, Marcos changed the first and sole beneficiary
of P120,000.00 which FM declared as Library and Miscellaneous assets. In to CHARIS FOUNDATION. This change was recorded on December 4,
computing for the networth, the income approach was utilized. Under this 1972.
approach, the beginning capital is increased or decreased, as the case may be,
depending upon the income earned or loss incurred. Computations establish 26. On August 29, 1978, the AZIO FOUNDATION was renamed to VERSO
the total networth of spouses Ferdinand and Imelda, for the years 1965 until FOUNDATION. The Board of Trustees remained the same. On March 11,
1984 in the total amount of US$957,487.75, assuming the income from legal 1981, Marcos issued a written directive to liquidated VERSO
practice is real and valid x x x. FOUNDATION and to transfer all its assets to account of FIDES TRUST
COMPANY at Bank Hofman in Zurich under the account Reference OSER.
G. THE SECRET MARCOS DEPOSITS The Board of Trustees decided to dissolve the foundation on June 25, 1981.
IN SWISS BANKS
27. In an apparent maneuver to bury further the secret deposits beneath the
23. The following presentation very clearly and overwhelmingly show in thick layers of corporate entities, FM effected the establishment of VIBUR
detail how both respondents clandestinely stashed away the countrys wealth FOUNDATION on May 13, 1981 in Vaduz. Atty. Ivo Beck and Limag
to Switzerland and hid the same under layers upon layers of foundations and Management, a wholly-owned subsidiary of Fides Trust, were designated as
other corporate entities to prevent its detection. Through their members of the Board of Trustees. The account was officially opened with
dummies/nominees, fronts or agents who formed those foundations or SKA on September 10, 1981. The beneficial owner was not made known to
corporate entities, they opened and maintained numerous bank accounts. But the bank since Fides Trust Company acted as fiduciary. However,
due to the difficulty if not the impossibility of detecting and documenting all comparison of the listing of the securities in the safe deposit register of the
those secret accounts as well as the enormity of the deposits therein hidden, VERSO FOUNDATIONas of February 27, 1981 with that of VIBUR
the following presentation is confined to five identified accounts groups, with FOUNDATION as of December 31, 1981 readily reveals that exactly the
balances amounting to about $356-M with a reservation for the filing of a same securities were listed.
supplemental or separate forfeiture complaint should the need arise.
28. Under the foregoing circumstances, it is certain that the VIBUR
H. THE AZIO-VERSO-VIBUR FOUNDATION is the beneficial successor of VERSO FOUNDATION.
FOUNDATION ACCOUNTS
29. On March 18, 1986, the Marcos-designated Board of Trustees decided to two (2) years until their closure sometime in February, 1970 and the balances
liquidate VIBUR FOUNDATION. A notice of such liquidation was sent to transferred to XANDY FOUNDATION.
the Office of the Public Register on March 21, 1986.However, the bank
accounts and respective balances of the said VIBUR FOUNDATION 33. The XANDY FOUNDATION was established on March 3, 1970 in
remained with SKA. Apparently, the liquidation was an attempt by the Vaduz. C.W. Fessler, C. Souviron and E. Scheller were named as members
Marcoses to transfer the foundations funds to another account or bank but of the Board of Trustees.
this was prevented by the timely freeze order issued by the Swiss
authorities. One of the latest documents obtained by the PCGG from the 34. FM and Imelda issued the written mandate to establish the foundation to
Swiss authorities is a declaration signed by Dr. Ivo Beck (the trustee) stating Markus Geel of SKA on March 3, 1970. In the handwritten Regulations
that the beneficial owner of VIBUR FOUNDATION is Ferdinand E. signed by the Marcos couple as well as in the type-written Regulations
Marcos. Another document signed by G. Raber of SKA shows that VIBUR signed by Markus Geel both dated February 13, 1970, the Marcos spouses
FOUNDATION is owned by the Marcos Familie were named the first beneficiaries, the surviving spouse as the second
beneficiary and the Marcos children Imee, Ferdinand, Jr. (Bongbong) and
30. As of December 31, 1989, the balance of the bank accounts of VIBUR Irene as equal third beneficiaries.
FOUNDATION with SKA, Zurich, under the General Account No. 469857
totaled $3,597,544.00 35. The XANDY FOUNDATION was renamed WINTROP FOUNDATION
on August 29, 1978. The Board of Trustees remained the same at the
I. XANDY-WINTROP: CHARIS-SCOLARI- outset. However, on March 27, 1980, Souviron was replaced by Dr. Peter
VALAMO-SPINUS-AVERTINA Ritter. On March 10. 1981, Ferdinand and Imelda Marcos issued a written
FOUNDATION ACCOUNTS order to the Board of Wintrop to liquidate the foundation and transfer all its
assets to Bank Hofmann in Zurich in favor of FIDES TRUST COMPANY.
31. This is the most intricate and complicated account group. As the Flow Later, WINTROP FOUNDATION was dissolved.
Chart hereof shows, two (2) groups under the foundation organized by
Marcos dummies/nominees for FMs benefit, eventually joined together and 36. The AVERTINA FOUNDATION was established on May 13, 1981 in
became one (1) account group under the AVERTINA FOUNDATION for Vaduz with Atty. Ivo Beck and Limag Management, a wholly-owned
the benefit of both FM and Imelda. This is the biggest group from where the subsidiary of FIDES TRUST CO., as members of the Board of Trustees. Two
$50-M investment fund of the Marcoses was drawn when they bought the (2) account categories, namely: CAR and NES, were opened on September
Central Banks dollar-denominated treasury notes with high-yielding 10, 1981. The beneficial owner of AVERTINA was not made known to the
interests. bank since the FIDES TRUST CO. acted as fiduciary. However, the
securities listed in the safe deposit register of WINTROP FOUNDATION
32. On March 20, 1968, after his second year in the presidency, Marcos Category R as of December 31, 1980 were the same as those listed in the
opened bank accounts with SKA using an alias or pseudonym WILLIAM register of AVERTINA FOUNDATION Category CAR as of December 31,
SAUNDERS, apparently to hide his true identity. The next day, March 21, 1981. Likewise, the securities listed in the safe deposit register of WINTROP
1968, his First Lady, Mrs. Imelda Marcos also opened her own bank FOUNDATION Category S as of December 31, 1980 were the same as those
accounts with the same bank using an American-sounding alias, JANE listed in the register of Avertina Category NES as of December 31,
RYAN. Found among the voluminous documents in Malacaang shortly after 1981.Under the circumstances, it is certain that the beneficial successor of
they fled to Hawaii in haste that fateful night of February 25, 1986, were WINTROP FOUNDATION is AVERTINA FOUNDATION. The balance of
accomplished forms for Declaration/Specimen Signatures submitted by the Category CAR as of December 31, 1989 amounted to US$231,366,894.00
Marcos couple. Under the caption signature(s) Ferdinand and Imelda signed while that of Category NES as of 12-31-83 was US$8,647,190.00. Latest
their real names as well as their respective aliases underneath. These documents received from Swiss authorities included a declaration signed by
accounts were actively operated and maintained by the Marcoses for about IVO Beck stating that the beneficial owners of AVERTINA FOUNDATION
are FM and Imelda. Another document signed by G. Raber of SKA indicates 3, 1982 with the safe deposit slips of the Avertina Foundation Category CAR
that Avertina Foundation is owned by the Marcos Families. as of August 19, 1982 shows that all the securities of Spinus were transferred
to Avertina.
37. The other groups of foundations that eventually joined AVERTINA were
also established by FM through his dummies, which started with the J. TRINIDAD-RAYBY-PALMY
CHARIS FOUNDATION. FOUNDATION ACCOUNTS
38. The CHARIS FOUNDATION was established in VADUZ on December 42. The Trinidad Foundation was organized on August 26, 1970 in Vaduz
27, 1971. Walter Fessler and Ernst Scheller of SKA and Dr. Peter Ritter were with C.W. Fessler and E. Scheller of SKA and Dr. Otto Tondury as the
named as directors. Dr. Theo Bertheau, SKA legal counsel, acted as founding foundations directors. Imelda issued a written mandate to establish the
director in behalf of FM by virtue of the mandate and agreement dated foundation to Markus Geel on August 26, 1970. The regulations as well as
November 12, 1971. FM himself was named the first beneficiary and Xandy the agreement, both dated August 28, 1970 were likewise signed by
Foundation as second beneficiary in accordance with the handwritten Imelda. Imelda was named the first beneficiary and her children Imelda
instructions of FM on November 12, 1971 and the Regulations. FM gave a (Imee), Ferdinand, Jr. (Bongbong) and, Irene were named as equal second
power of attorney to Roberto S. Benedicto on February 15, 1972 to act in his beneficiaries.
behalf with regard to Charis Foundation.
43. Rayby Foundation was established on June 22, 1973 in Vaduz with
39. On December 13, 1974, Charis Foundation was renamed Scolari Fessler, Scheller and Ritter as members of the board of directors. Imelda
Foundation but the directors remained the same. On March 11, 1981 FM issued a written mandate to Dr. Theo Bertheau to establish the foundation
ordered in writing that the Valamo Foundation be liquidated and all its assets with a note that the foundations capitalization as well as the cost of
be transferred to Bank Hofmann, AG in favor of Fides Trust Company under establishing it be debited against the account of Trinidad Foundation. Imelda
the account Reference OMAL. The Board of Directors decided on the was named the first and only beneficiary of Rayby foundation. According to
immediate dissolution of Valamo Foundation on June 25, 1981. written information from SKA dated November 28, 1988, Imelda apparently
had the intention in 1973 to transfer part of the assets of Trinidad Foundation
40 The SPINUS FOUNDATION was established on May 13, 1981 in Vaduz to another foundation, thus the establishment of Rayby
with Atty. Ivo Beck and Limag Management, a wholly-owned subsidiary of Foundation. However, transfer of assets never took place. On March 10,
Fides Trust Co., as members of the Foundations Board of Directors. The 1981, Imelda issued a written order to transfer all the assets of Rayby
account was officially opened with SKA on September 10, 1981. The Foundation to Trinidad Foundation and to subsequently liquidate Rayby. On
beneficial owner of the foundation was not made known to the bank since the same date, she issued a written order to the board of Trinidad to dissolve
Fides Trust Co. acted as fiduciary. However, the list of securities in the safe the foundation and transfer all its assets to Bank Hofmann in favor of Fides
deposit register of Valamo Foundation as of December 31, 1980 are Trust Co. Under the account Reference Dido, Rayby was dissolved on April
practically the same with those listed in the safe deposit register of Spinus 6, 1981 and Trinidad was liquidated on August 3, 1981.
Foundation as of December 31, 1981. Under the circumstances, it is certain
that the Spinus Foundation is the beneficial successor of the Valamo 44. The PALMY FOUNDATION was established on May 13, 1981 in Vaduz
Foundation. with Dr. Ivo Beck and Limag Management, a wholly-owned subsidiary of
Fides Trust Co, as members of the Foundations Board of Directors. The
41. On September 6, 1982, there was a written instruction from Spinus account was officially opened with the SKA on September 10, 1981. The
Foundation to SKA to close its Swiss Franc account and transfer the balance beneficial owner was not made known to the bank since Fides Trust Co.
to Avertina Foundation. In July/August, 1982, several transfers from the acted as fiduciary. However, when one compares the listing of securities in
foundations German marks and US dollar accounts were made to Avertina the safe deposit register of Trinidad Foundation as of December 31,1980
Category CAR totaling DM 29.5-M and $58-M, respectively. Moreover, a with that of the Palmy Foundation as of December 31, 1980, one can clearly
comparison of the list of securities of the Spinus Foundation as of February see that practically the same securities were listed. Under the circumstances,
it is certain that the Palmy Foundation is the beneficial successor of the divided in equal parts among their children. Another Malacaang document
Trinidad Foundation. dated October 19,1968 and signed by Ferdinand and Imelda pertains to the
appointment of Dr. Andre Barbey and Jean Louis Sunier as attorneys of the
45. As of December 31, 1989, the ending balance of the bank accounts of company and as administrator and manager of all assets held by the
Palmy Foundation under General Account No. 391528 is $17,214,432.00. company. The Marcos couple, also mentioned in the said document that they
bought the Maler Establishment from SBC, Geneva. On the same date, FM
46. Latest documents received from Swiss Authorities included a declaration and Imelda issued a letter addressed to Maler Establishment, stating that all
signed by Dr. Ivo Beck stating that the beneficial owner of Palmy Foundation instructions to be transmitted with regard to Maler will be signed with the
is Imelda. Another document signed by Raber shows that the said Palmy word JOHN LEWIS. This word will have the same value as the couples own
Foundation is owned by Marcos Familie. personal signature. The letter was signed by FM and Imelda in their
signatures and as John Lewis.
K. ROSALYS-AGUAMINA
FOUNDATION ACCOUNTS 50. Maler Establishment opened and maintained bank accounts with SBC,
Geneva. The opening bank documents were signed by Dr. Barbey and Mr.
47. Rosalys Foundation was established in 1971 with FM as the beneficiary. Sunnier as authorized signatories.
Its Articles of Incorporation was executed on September 24, 1971 and its By-
Laws on October 3, 1971. This foundation maintained several accounts with 51. On November 17, 1981, it became necessary to transform Maler
Swiss Bank Corporation (SBC) under the general account 51960 where most Establishment into a foundation. Likewise, the attorneys were changed to
of the bribe monies from Japanese suppliers were hidden. Michael Amaudruz, et. al. However, administration of the assets was left to
SBC. The articles of incorporation of Maler Foundation registered on
48. On December 19, 1985, Rosalys Foundation was liquidated and all its November 17, 1981 appear to be the same articles applied to Maler
assets were transferred to Aguamina Corporations (Panama) Account No. Establishment. On February 28, 1984, Maler Foundation cancelled the power
53300 with SBC. The ownership by Aguamina Corporation of Account No. of attorney for the management of its assets in favor of SBC and transferred
53300 is evidenced by an opening account documents from the bank. J. such power to Sustrust Investment Co., S.A.
Christinaz and R.L. Rossier, First Vice-President and Senior Vice President,
respectively, of SBC, Geneva issued a declaration dated September 3, 1991 52. As of June 6, 1991, the ending balance of Maler Foundations Account
stating that the by-laws dated October 3, 1971 governing Rosalys Foundation Nos. 254,508 BT and 98,929 NY amount SF 9,083,567 and SG 16,195,258,
was the same by-law applied to Aguamina Corporation Account No. 53300. respectively, for a total of SF 25,278,825.00. GM only until December 31,
They further confirmed that no change of beneficial owner was involved 1980. This account was opened by Maler when it was still an establishment
while transferring the assets of Rosalys to Aguamina. Hence, FM remains the which was subsequently transformed into a foundation.
beneficiary of Aguamina Corporation Account No. 53300.
53. All the five (5) group accounts in the over-all flow chart have a total
As of August 30, 1991, the ending balance of Account No. 53300 amounted balance of about Three Hundred Fifty Six Million Dollars ($356,000,000.00)
to $80,566,483.00. as shown by Annex R-5 hereto attached as integral part hereof.
L. MALER FOUNDATION ACCOUNTS x x x x x x.[27]
49. Maler was first created as an establishment. A statement of its rules and Respondents Imelda R. Marcos, Maria Imelda M. Manotoc, Irene
regulations was found among Malacaang documents. It stated, among others, M. Araneta and Ferdinand Marcos, Jr., in their answer, stated the
that 50% of the Companys assets will be for sole and full right disposal of following:
FM and Imelda during their lifetime, which the remaining 50% will be
xxx xxx xxx 16. Respondents specifically DENY paragraph 17 of the Petition insofar as it
attributes willful duplicity on the part of the late President Marcos, for being
4. Respondents ADMIT paragraphs 3 and 4 of the Petition. false, the same being pure conclusions based on pure assumption and not
allegations of fact; and specifically DENY the rest for lack of knowledge or
5. Respondents specifically deny paragraph 5 of the Petition in so far as it information sufficient to form a belief as to the truth of the allegation since
states that summons and other court processes may be served on Respondent Respondents cannot remember with exactitude the contents of the alleged
Imelda R. Marcos at the stated address the truth of the matter being that ITRs or the attachments thereto.
Respondent Imelda R. Marcos may be served with summons and other
processes at No. 10-B Bel Air Condominium 5022 P. Burgos Street, Makati, 17. Respondents specifically DENY paragraph 18 of the Petition for lack of
Metro Manila, and ADMIT the rest. knowledge or information sufficient to form a belief as to the truth of the
allegation since Respondents cannot remember with exactitude the contents
xxx xxx xxx of the alleged ITRs.
10. Respondents ADMIT paragraph 11 of the Petition. 18. Respondents specifically DENY paragraph 19 of the Petition for lack of
knowledge or information sufficient to form a belief as to the truth of the
11. Respondents specifically DENY paragraph 12 of the Petition for lack of allegation since Respondents cannot remember with exactitude the contents
knowledge sufficient to form a belief as to the truth of the allegation since of the alleged ITRs and that they are not privy to the activities of the BIR.
Respondents were not privy to the transactions and that they cannot
remember exactly the truth as to the matters alleged. 19. Respondents specifically DENY paragraph 20 of the Petition for lack of
knowledge or information sufficient to form a belief as to the truth of the of the alleged ITRs.
of the alleged ITRs and Balance Sheet. 20. Respondents specifically DENY paragraph 21 of the Petition for lack of
of the alleged ITRs. 21. Respondents specifically DENY paragraph 22 of the Petition for lack of
of the alleged ITRs. 22. Respondents specifically DENY paragraph 23 insofar as it alleges that
Respondents clandestinely stashed the countrys wealth in Switzerland and
15. Respondents specifically DENY paragraph 16 of the Petition for lack of hid the same under layers and layers of foundation and corporate entities for
knowledge or information sufficient to form a belief as to the truth of the being false, the truth being that Respondents aforesaid properties were
allegation since Respondents cannot remember with exactitude the contents lawfully acquired.
of the alleged ITRs.
23. Respondents specifically DENY paragraphs 24, 25, 26, 27, 28, 29 and 30
of the Petition for lack of knowledge or information sufficient to form a
belief as to the truth of the allegation since Respondents were not privy to the The following pleadings filed by respondent Marcoses are replete
transactions regarding the alleged Azio-Verso-Vibur Foundation accounts, with indications of a spurious defense:
except that as to Respondent Imelda R. Marcos she specifically remembers
that the funds involved were lawfully acquired. (a) Respondents' Answer dated October 18, 1993;
24. Respondents specifically DENY paragraphs 31, 32, 33, 34, 35, 36,37, 38, (b) Pre-trial Brief dated October 4, 1999 of Mrs. Marcos,
39, 40, and 41 of the Petition for lack of knowledge or information sufficient Supplemental Pre-trial Brief dated October 19, 1999 of
to form a belief as to the truth of the allegations since Respondents are not Ferdinand, Jr. and Mrs. Imee Marcos-Manotoc adopting the
privy to the transactions and as to such transaction they were privy to they pre-trial brief of Mrs. Marcos, and Manifestation dated
cannot remember with exactitude the same having occurred a long time ago, October 19, 1999 of Irene Marcos-Araneta adopting the pre-
except that as to Respondent Imelda R. Marcos she specifically remembers trial briefs of her co- respondents;
that the funds involved were lawfully acquired.
(c) Opposition to Motion for Summary Judgment dated March 21,
25. Respondents specifically DENY paragraphs 42, 43, 44, 45, and 46, of the 2000, filed by Mrs. Marcos which the other respondents
Petition for lack of knowledge or information sufficient to form a belief as to (Marcos children) adopted;
the truth of the allegations since Respondents were not privy to the
transactions and as to such transaction they were privy to they cannot (d) Demurrer to Evidence dated May 2, 2000 filed by Mrs. Marcos
remember with exactitude the same having occurred a long time ago, except and adopted by the Marcos children;
that as to Respondent Imelda R. Marcos she specifically remembers that the
funds involved were lawfully acquired. (e) Motion for Reconsideration dated September 26, 2000 filed by
Mrs. Marcos; Motion for Reconsideration dated October 5,
26. Respondents specifically DENY paragraphs 49, 50, 51 and 52, of the 2000 jointly filed by Mrs. Manotoc and Ferdinand, Jr., and
Petition for lack of knowledge or information sufficient to form a belief as to Supplemental Motion for Reconsideration dated October 9,
the truth of the allegations since Respondents were not privy to the 2000 likewise jointly filed by Mrs. Manotoc and Ferdinand,
transactions and as to such transaction they were privy to they cannot Jr.;
remember with exactitude the same having occurred a long time ago, except
that as to Respondent Imelda R. Marcos she specifically remembers that the (f) Memorandum dated December 12, 2000 of Mrs. Marcos and
funds involved were lawfully acquired. Memorandum dated December 17, 2000 of the Marcos
children;
Upon careful perusal of the foregoing, the Court finds that
respondent Mrs. Marcos and the Marcos children indubitably failed to (g) Manifestation dated May 26, 1998; and
tender genuine issues in their answer to the petition for forfeiture. A
genuine issue is an issue of fact which calls for the presentation of (h) General/Supplemental Agreement dated December 23, 1993.
evidence as distinguished from an issue which is fictitious and
contrived, set up in bad faith or patently lacking in substance so as not
An examination of the foregoing pleadings is in order.
to constitute a genuine issue for trial. Respondents defenses of lack of
knowledge for lack of privity or (inability to) recall because it happened Respondents Answer dated October 18, 1993.
a long time ago or, on the part of Mrs. Marcos, that the funds were
lawfully acquired are fully insufficient to tender genuine issues. In their answer, respondents failed to specifically deny each and
Respondent Marcoses defenses were a sham and evidently every allegation contained in the petition for forfeiture in the manner
calibrated to compound and confuse the issues. required by the rules. All they gave were stock answers like they have
no sufficient knowledge or they could not recall because it happened
a long time ago, and, as to Mrs. Marcos, the funds were lawfully Respondents denials in their answer at the Sandiganbayan were
acquired, without stating the basis of such assertions. based on their alleged lack of knowledge or information sufficient to
form a belief as to the truth of the allegations of the petition.
Section 10, Rule 8 of the 1997 Rules of Civil Procedure, provides:
It is true that one of the modes of specific denial under the rules
A defendant must specify each material allegation of fact the truth of which is a denial through a statement that the defendant is without
he does not admit and, whenever practicable, shall set forth the substance of knowledge or information sufficient to form a belief as to the truth of
the matters upon which he relies to support his denial. Where a defendant the material averment in the complaint. The question, however, is
desires to deny only a part of an averment, he shall specify so much of it as is whether the kind of denial in respondents answer qualifies as the
true and material and shall deny the remainder. Where a defendant is without specific denial called for by the rules. We do not think so. In Morales
knowledge or information sufficient to form a belief as to the truth of a vs. Court of Appeals,[30] this Court ruled that if an allegation directly
material averment made in the complaint, he shall so state, and this shall and specifically charges a party with having done, performed or
have the effect of a denial.[28] committed a particular act which the latter did not in fact do, perform
or commit, a categorical and express denial must be made.
The purpose of requiring respondents to make a specific denial is Here, despite the serious and specific allegations against them,
to make them disclose facts which will disprove the allegations of the Marcoses responded by simply saying that they had no
petitioner at the trial, together with the matters they rely upon in knowledge or information sufficient to form a belief as to the truth of
support of such denial. Our jurisdiction adheres to this rule to avoid such allegations. Such a general, self-serving claim of ignorance of
and prevent unnecessary expenses and waste of time by compelling the facts alleged in the petition for forfeiture was insufficient to raise
both parties to lay their cards on the table, thus reducing the an issue. Respondent Marcoses should have positively stated how it
controversy to its true terms. As explained in Alonso vs. Villamor,[29] was that they were supposedly ignorant of the facts alleged.[31]
A litigation is not a game of technicalities in which one, more deeply To elucidate, the allegation of petitioner Republic in paragraph 23
schooled and skilled in the subtle art of movement and position, entraps and of the petition for forfeiture stated:
destroys the other. It is rather a contest in which each contending party fully
and fairly lays before the court the facts in issue and then, brushing aside as 23. The following presentation very clearly and overwhelmingly show in
wholly trivial and indecisive all imperfections of form and technicalities of detail how both respondents clandestinely stashed away the countrys wealth
procedure, asks that justice be done upon the merits. Lawsuits, unlike duels, to Switzerland and hid the same under layers upon layers of foundations and
are not to be won by a rapiers thrust. other corporate entities to prevent its detection. Through their
dummies/nominees, fronts or agents who formed those foundations or
On the part of Mrs. Marcos, she claimed that the funds were corporate entities, they opened and maintained numerous bank accounts. But
lawfully acquired. However, she failed to particularly state the ultimate due to the difficulty if not the impossibility of detecting and documenting all
facts surrounding the lawful manner or mode of acquisition of the those secret accounts as well as the enormity of the deposits therein hidden,
subject funds. Simply put, she merely stated in her answer with the the following presentation is confined to five identified accounts groups, with
other respondents that the funds were lawfully acquired without balances amounting to about $356-M with a reservation for the filing of a
detailing how exactly these funds were supposedly acquired legally by supplemental or separate forfeiture complaint should the need arise.[32]
them. Even in this case before us, her assertion that the funds were
lawfully acquired remains bare and unaccompanied by any factual Respondents lame denial of the aforesaid allegation was:
support which can prove, by the presentation of evidence at a
hearing, that indeed the funds were acquired legitimately by the 22. Respondents specifically DENY paragraph 23 insofar as it alleges that
Marcos family. Respondents clandestinely stashed the countrys wealth in Switzerland and
hid the same under layers and layers of foundations and corporate entities for
being false, the truth being that Respondents aforesaid properties were By the same token, the following unsupported denials of
lawfully acquired.[33] respondents in their answer were pregnant with admissions of the
substantial facts alleged in the Republics petition for forfeiture:
Evidently, this particular denial had the earmark of what is called
in the law on pleadings as a negative pregnant, that is, a denial 23. Respondents specifically DENY paragraphs 24, 25, 26, 27, 28, 29 and 30
pregnant with the admission of the substantial facts in the pleading of the Petition for lack of knowledge or information sufficient to form a
responded to which are not squarely denied. It was in effect an belief as to the truth of the allegation since respondents were not privy to the
admission of the averments it was directed at. [34] Stated otherwise, a transactions regarding the alleged Azio-Verso-Vibur Foundation accounts,
negative pregnant is a form of negative expression which carries with except that, as to respondent Imelda R. Marcos, she specifically remembers
it an affirmation or at least an implication of some kind favorable to the that the funds involved were lawfully acquired.
adverse party. It is a denial pregnant with an admission of the
substantial facts alleged in the pleading. Where a fact is alleged with 24. Respondents specifically DENY paragraphs 31, 32, 33, 34, 35, 36, 37,
qualifying or modifying language and the words of the allegation as so 38, 39, 40, 41 of the Petition for lack of knowledge or information sufficient
qualified or modified are literally denied, has been held that the to form a belief as to the truth of the allegations since respondents were not
qualifying circumstances alone are denied while the fact itself is privy to the transactions and as to such transactions they were privy to, they
admitted.[35] cannot remember with exactitude the same having occurred a long time ago,
except as to respondent Imelda R. Marcos, she specifically remembers that
In the instant case, the material allegations in paragraph 23 of the
the funds involved were lawfully acquired.
said petition were not specifically denied by respondents in paragraph
22 of their answer. The denial contained in paragraph 22 of the
answer was focused on the averment in paragraph 23 of the petition 25. Respondents specifically DENY paragraphs 42, 43, 45, and 46 of the
for forfeiture that Respondents clandestinely stashed the countrys petition for lack of knowledge or information sufficient to from a belief as to
wealth in Switzerland and hid the same under layers and layers of the truth of the allegations since respondents were not privy to the
foundations and corporate entities. Paragraph 22 of the respondents transactions and as to such transaction they were privy to, they cannot
answer was thus a denial pregnant with admissions of the following remember with exactitude, the same having occurred a long time ago, except
substantial facts: that as to respondent Imelda R. Marcos, she specifically remembers that the
funds involved were lawfully acquired.
(1) the Swiss bank deposits existed and
26. Respondents specifically DENY paragraphs 49, 50, 51 and 52 of the
petition for lack of knowledge and information sufficient to form a belief as
(2) that the estimated sum thereof was US$356 million as of
to the truth of the allegations since respondents were not privy to the
December, 1990.
transactions and as to such transaction they were privy to they cannot
remember with exactitude the same having occurred a long time ago, except
Therefore, the allegations in the petition for forfeiture on the that as to respondent Imelda R. Marcos, she specifically remembers that the
existence of the Swiss bank deposits in the sum of about US$356 funds involved were lawfully acquired.
million, not having been specifically denied by respondents in their
answer, were deemed admitted by them pursuant to Section 11, Rule
The matters referred to in paragraphs 23 to 26 of the respondents
8 of the 1997 Revised Rules on Civil Procedure:
answer pertained to the creation of five groups of accounts as well as
their respective ending balances and attached documents alleged in
Material averment in the complaint, xxx shall be deemed admitted when not paragraphs 24 to 52 of the Republics petition for
specifically denied. xxx.[36] forfeiture. Respondent Imelda R. Marcos never specifically denied the
existence of the Swiss funds. Her claim that the funds involved were
lawfully acquired was an acknowledgment on her part of the existence
of said deposits. This only reinforced her earlier admission of the How could respondents therefore claim lack of sufficient
allegation in paragraph 23 of the petition for forfeiture regarding the knowledge or information regarding the existence of the Swiss bank
existence of the US$356 million Swiss bank deposits. deposits and the creation of five groups of accounts when Mrs.
Marcos and her late husband personally masterminded and
The allegations in paragraphs 47[37] and 48[38] of the petition for participated in the formation and control of said foundations? This is a
forfeiture referring to the creation and amount of the deposits of the fact respondent Marcoses were never able to explain.
Rosalys-Aguamina Foundation as well as the averment in paragraph
52-a[39] of the said petition with respect to the sum of the Swiss bank Not only that. Respondents' answer also technically admitted the
deposits estimated to be US$356 million were again not specifically genuineness and due execution of the Income Tax Returns (ITRs)
denied by respondents in their answer. The respondents did not at all and the balance sheets of the late Ferdinand E. Marcos and Imelda R.
respond to the issues raised in these paragraphs and the existence, Marcos attached to the petition for forfeiture, as well as the veracity of
nature and amount of the Swiss funds were therefore deemed the contents thereof.
admitted by them. As held in Galofa vs. Nee Bon Sing,[40] if a
defendants denial is a negative pregnant, it is equivalent to an The answer again premised its denials of said ITRs and balance
sheets on the ground of lack of knowledge or information sufficient to
admission.
form a belief as to the truth of the contents thereof. Petitioner correctly
Moreover, respondents denial of the allegations in the petition for points out that respondents' denial was not really grounded on lack of
forfeiture for lack of knowledge or information sufficient to form a knowledge or information sufficient to form a belief but was based on
belief as to the truth of the allegations since respondents were not lack of recollection. By reviewing their own records, respondent
privy to the transactions was just a pretense. Mrs. Marcos privity to Marcoses could have easily determined the genuineness and due
the transactions was in fact evident from her signatures on some of execution of the ITRs and the balance sheets. They also had the
the vital documents[41]attached to the petition for forfeiture which means and opportunity of verifying the same from the records of the
Mrs. Marcos failed to specifically deny as required by the rules.[42] BIR and the Office of the President. They did not.
It is worthy to note that the pertinent documents attached to the When matters regarding which respondents claim to have no
petition for forfeiture were even signed personally by respondent Mrs. knowledge or information sufficient to form a belief are plainly and
Marcos and her late husband, Ferdinand E. Marcos, indicating that necessarily within their knowledge, their alleged ignorance or lack of
said documents were within their knowledge. As correctly pointed out information will not be considered a specific denial. [44] An unexplained
by Sandiganbayan Justice Francisco Villaruz, Jr. in his dissenting denial of information within the control of the pleader, or is readily
opinion: accessible to him, is evasive and is insufficient to constitute an
effective denial.[45]
The pattern of: 1) creating foundations, 2) use of pseudonyms and dummies,
The form of denial adopted by respondents must be availed
3) approving regulations of the Foundations for the distribution of capital and
of with sincerity and in good faith, and certainly not for the purpose of
income of the Foundations to the First and Second beneficiary (who are no
confusing the adverse party as to what allegations of the petition are
other than FM and his family), 4) opening of bank accounts for the
really being challenged; nor should it be made for the purpose of
Foundations, 5) changing the names of the Foundations, 6) transferring funds
delay.[46] In the instant case, the Marcoses did not only present
and assets of the Foundations to other Foundations or Fides Trust, 7)
unsubstantiated assertions but in truth attempted to mislead and
liquidation of the Foundations as substantiated by the Annexes U to U-168,
deceive this Court by presenting an obviously contrived defense.
Petition [for forfeiture] strongly indicate that FM and/or Imelda were the real
owners of the assets deposited in the Swiss banks, using the Foundations as Simply put, a profession of ignorance about a fact which is
dummies.[43] patently and necessarily within the pleaders knowledge or means of
knowing is as ineffective as no denial at all.[47]Respondents ineffective
denial thus failed to properly tender an issue and the averments
contained in the petition for forfeiture were deemed judicially admitted It is unquestionably within the courts power to require the parties
by them. to submit their pre-trial briefs and to state the number of witnesses
intended to be called to the stand, and a brief summary of the
As held in J.P. Juan & Sons, Inc. vs. Lianga Industries, Inc.: evidence each of them is expected to give as well as to disclose the
number of documents to be submitted with a description of the nature
Its specific denial of the material allegation of the petition without setting of each. The tenor and character of the testimony of the witnesses
forth the substance of the matters relied upon to support its general denial, and of the documents to be deduced at the trial thus made known, in
when such matters were plainly within its knowledge and it could not addition to the particular issues of fact and law, it becomes apparent if
logically pretend ignorance as to the same, therefore, failed to properly genuine issues are being put forward necessitating the holding of a
tender on issue.[48] trial. Likewise, the parties are obliged not only to make a formal
identification and specification of the issues and their proofs, and to
Thus, the general denial of the Marcos children of the allegations put these matters in writing and submit them to the court within the
in the petition for forfeiture for lack of knowledge or information specified period for the prompt disposition of the action.[50]
sufficient to form a belief as to the truth of the allegations since they
were not privy to the transactions cannot rightfully be accepted as a The pre-trial brief of Mrs. Marcos, as subsequently adopted by
defense because they are the legal heirs and successors-in-interest of respondent Marcos children, merely stated:
Ferdinand E. Marcos and are therefore bound by the acts of their
father vis-a-vis the Swiss funds. xxx
PRE-TRIAL BRIEF DATED OCTOBER 18, 1993 WITNESSES
The pre-trial brief of Mrs. Marcos was adopted by the three
Marcos children. In said brief, Mrs. Marcos stressed that the funds 4.1 Respondent Imelda will present herself as a witness and reserves the right
involved were lawfully acquired. But, as in their answer, they failed to to present additional witnesses as may be necessary in the course of the trial.
state and substantiate how these funds were acquired lawfully. They
failed to present and attach even xxx
a single document that would show and prove the truth of their
allegations. Section 6, Rule 18 of the 1997 Rules of Civil Procedure DOCUMENTARY EVIDENCE
provides:
5.1 Respondent Imelda reserves the right to present and introduce in
The parties shall file with the court and serve on the adverse party, x x x their evidence documents as may be necessary in the course of the trial.
respective pre-trial briefs which shall contain, among others:
Mrs. Marcos did not enumerate and describe the documents
xxx constituting her evidence. Neither the names of witnesses nor the
nature of their testimony was stated. What alone appeared certain
(d) the documents or exhibits to be presented, stating the purpose thereof; was the testimony of Mrs. Marcos only who in fact had previously
claimed ignorance and lack of knowledge. And even then, the
xxx substance of her testimony, as required by the rules, was not made
known either. Such cunning tactics of respondents are totally
(f) the number and names of the witnesses, and the substance of their unacceptable to this Court. We hold that, since no genuine issue was
respective testimonies.[49] raised, the case became ripe for summary judgment.
OPPOSITION TO MOTION FOR SUMMARY JUDGMENT
DATED MARCH 21, 2000 less subject matter of the instant lawsuit as allegedly obtained from the
various Swiss Foundations do not belong to the estate of Marcos or to Imelda
The opposition filed by Mrs. Marcos to the motion for summary Marcos herself. Thats your statement of facts?
judgment dated March 21, 2000 of petitioner Republic was merely
adopted by the Marcos children as their own opposition to the said
Atty. MARCELO:
motion. However, it was again not accompanied by affidavits,
depositions or admissions as required by Section 3, Rule 35 of the
1997 Rules on Civil Procedure: Yes, Your Honor.
x x x The adverse party may serve opposing affidavits, depositions, or PJ Garchitorena:

admissions at least three (3) days before hearing. After hearing, the judgment
sought shall be rendered forthwith if the pleadings, supporting affidavits, Thats it. Okay. Counsel for Manotoc and Manotoc, Jr. What is your point
depositions, and admissions on file, show that, except as to the amount of here? Does the estate of Marcos own anything of the $360 million subject of
damages, there is no genuine issue as to any material fact and that the this case.
moving party is entitled to a judgment as a matter of law.[51]
Atty. TECSON:
The absence of opposing affidavits, depositions and admissions
to contradict the sworn declarations in the Republics motion only We joined the Manifestation of Counsel.
demonstrated that the averments of such opposition were not genuine
and therefore unworthy of belief. PJ Garchitorena:
Demurrer to Evidence dated May 2, 2000;[52]
You do not own anything?
Motions for Reconsideration;[53] and Memoranda
of Mrs. Marcos and the Marcos children[54]
Atty. TECSON:
All these pleadings again contained no allegations of facts
showing their lawful acquisition of the funds. Once more, respondents Yes, Your Honor.
merely made general denials without alleging facts which would have
been admissible in evidence at the hearing, thereby failing to raise PJ Garchitorena:
genuine issues of fact.
Mrs. Marcos insists in her memorandum dated October 21, 2002 Counsel for Irene Araneta?
that, during the pre-trial, her counsel stated that his client was just a
beneficiary of the funds, contrary to petitioner Republics allegation Atty. SISON:
that Mrs. Marcos disclaimed ownership of or interest in the funds.
I join the position taken by my other compaeros here, Your Honor.
This is yet another indication that respondents presented a
fictitious defense because, during the pre-trial, Mrs. Marcos and the
xxx
Marcos children denied ownership of or interest in the Swiss funds:
Atty. SISON:
PJ Garchitorena:
Irene Araneta as heir do (sic) not own any of the amount, Your Honor.[55]
Make of record that as far as Imelda Marcos is concerned through the
statement of Atty. Armando M. Marcelo that the US$360 million more or
We are convinced that the strategy of respondent Marcoses was verbiage that was evidently wanting in substance and constituted no
to confuse petitioner Republic as to what facts they would prove or genuine issues for trial.
what issues they intended to pose for the court's resolution. There is
We therefore rule that, under the circumstances, summary
no doubt in our mind that they were leading petitioner Republic, and
now this Court, to perplexity, if not trying to drag this forfeiture case to judgment is proper.
eternity. In fact, it is the law itself which determines when summary
Manifestation dated May 26, 1998 filed by MRS. judgment is called for. Under the rules, summary judgment is
appropriate when there are no genuine issues of fact requiring the
Marcos; General/Supplemental Compromise
presentation of evidence in a full-blown trial. Even if on their face the
Agreement dated December 28, 1993
pleadings appear to raise issue, if the affidavits, depositions and
These pleadings of respondent Marcoses presented nothing but admissions show that such issues are not genuine, then summary
feigned defenses. In their earlier pleadings, respondents alleged judgment as prescribed by the rules must ensue as a matter of law.[56]
either that they had no knowledge of the existence of the Swiss
In sum, mere denials, if unaccompanied by any fact which will be
deposits or that they could no longer remember anything as it
admissible in evidence at a hearing, are not sufficient to raise genuine
happened a long time ago. As to Mrs. Marcos, she remembered that it
issues of fact and will not defeat a motion for summary judgment. [57] A
was lawfully acquired.
summary judgment is one granted upon motion of a party for an
In her Manifestation dated May 26, 1998, Mrs. Marcos stated expeditious settlement of the case, it appearing from the pleadings,
that: depositions, admissions and affidavits that there are no important
questions or issues of fact posed and, therefore, the movant is entitled
COMES NOW undersigned counsel for respondent Imelda R. Marcos, and to a judgment as a matter of law. A motion for summary judgment is
before this Honorable Court, most respectfully manifests: premised on the assumption that the issues presented need not be
tried either because these are patently devoid of substance or that
That respondent Imelda R, Marcos owns 90% of the subject matter of the there is no genuine issue as to any pertinent fact. It is a method
above-entitled case, being the sole beneficiary of the dollar deposits in the sanctioned by the Rules of Court for the prompt disposition of a civil
name of the various foundations alleged in the case; action where there exists no serious controversy.[58] Summary
judgment is a procedural device for the prompt disposition of actions
That in fact only 10% of the subject matter in the above-entitled case belongs in which the pleadings raise only a legal issue, not a genuine issue as
to the estate of the late President Ferdinand E. Marcos. to any material fact. The theory of summary judgment is that, although
an answer may on its face appear to tender issues requiring trial, if it
is established by affidavits, depositions or admissions that those
In the Compromise/Supplemental Agreements, respondent
Marcoses sought to implement the agreed distribution of the Marcos issues are not genuine but fictitious, the Court is justified in dispensing
with the trial and rendering summary judgment for petitioner.[59]
assets, including the Swiss deposits. This was, to us, an unequivocal
admission of ownership by the Marcoses of the said deposits. In the various annexes to the petition for forfeiture, petitioner
Republic attached sworn statements of witnesses who had personal
But, as already pointed out, during the pre-trial conference,
respondent Marcoses denied knowledge as well as ownership of the knowledge of the Marcoses' participation in the illegal acquisition of
funds deposited in the Swiss accounts under the names of five groups
Swiss funds.
or foundations. These sworn statements substantiated the ill-gotten
Anyway we look at it, respondent Marcoses have put forth no real nature of the Swiss bank deposits. In their answer and other
defense. The facts pleaded by respondents, while ostensibly raising subsequent pleadings, however, the Marcoses merely made general
important questions or issues of fact, in reality comprised mere denials of the allegations against them without stating facts admissible
in evidence at the hearing, thereby failing to raise any genuine issues Summary Judgment
of fact.
Section 1. Summary judgment for claimant. - A party seeking to recover
Under these circumstances, a trial would have served no purpose
upon a claim, counterclaim, or cross-claim or to obtain a declaratory relief
at all and would have been totally unnecessary, thus justifying a
may, at any time after the pleading in answer thereto has been served,
summary judgment on the petition for forfeiture. There were no
move with supporting affidavits, depositions or admissions for a summary
opposing affidavits to contradict the sworn declarations of the
judgment in his favor upon all or any part thereof.
witnesses of petitioner Republic, leading to the inescapable
conclusion that the matters raised in the Marcoses answer were false.
Section 2. Summary judgment for defending party. - A party against whom a
Time and again, this Court has encountered cases like this which claim, counterclaim, or cross-claim is asserted or a declaratory relief is
are either only half-heartedly defended or, if the semblance of a sought may, at any time, move with supporting affidavits, depositions or
defense is interposed at all, it is only to delay disposition and gain admissions for a summary judgment in his favor as to all or any part thereof.
time. It is certainly not in the interest of justice to allow respondent (Emphasis ours)[61]
Marcoses to avail of the appellate remedies accorded by the Rules of
Court to litigants in good faith, to the prejudice of the Republic and Under the rule, the plaintiff can move for summary judgment at
ultimately of the Filipino people. From the beginning, a candid any time after the pleading in answer thereto (i.e., in answer to the
demonstration of respondents good faith should have been made to claim, counterclaim or cross-claim) has been served."No fixed
the court below.Without the deceptive reasoning and argumentation, reglementary period is provided by the Rules. How else does one
this protracted litigation could have ended a long time ago. construe the phrase "any time after the answer has been served?
Since 1991, when the petition for forfeiture was first filed, up to This issue is actually one of first impression. No local
the present, all respondents have offered are foxy responses like lack jurisprudence or authoritative work has touched upon this matter. This
of sufficient knowledge or lack of privity or they cannot recall because being so, an examination of foreign laws and jurisprudence,
it happened a long time ago or, as to Mrs. Marcos, the funds were particularly those of the United States where many of our laws and
lawfully acquired. But, whenever it suits them, they also claim rules were copied, is in order.
ownership of 90% of the funds and allege that only 10% belongs to
the Marcos estate. It has been an incredible charade from beginning Rule 56 of the Federal Rules of Civil Procedure provides that a
to end. party seeking to recover upon a claim, counterclaim or cross-claim
may move for summary judgment at any time after the expiration of
In the hope of convincing this Court to rule otherwise, 20 days from the commencement of the action or after service of a
respondents Maria Imelda Marcos-Manotoc and Ferdinand R. Marcos motion for summary judgment by the adverse party, and that a party
Jr. contend that "by its positive acts and express admissions prior to against whom a claim, counterclaim or cross-claim is asserted may
filing the motion for summary judgment on March 10, 2000, petitioner move for summary judgment at any time.
Republic had bound itself to go to trial on the basis of existing issues.
Thus, it had legally waived whatever right it had to move for summary However, some rules, particularly Rule 113 of the Rules of Civil
judgment."[60] Practice of New York, specifically provide that a motion for summary
judgment may not be made until issues have been joined, that is, only
We do not think so. The alleged positive acts and express after an answer has been served.[62] Under said rule, after issues have
admissions of the petitioner did not preclude it from filing a motion for been joined, the motion for summary judgment may be made at any
summary judgment. stage of the litigation.[63] No fixed prescriptive period is provided.
Rule 35 of the 1997 Rules of Civil Procedure provides: Like Rule 113 of the Rules of Civil Practice of New York, our rules
also provide that a motion for summary judgment may not be made
Rule 35 until issues have been joined, meaning, the plaintiff has to wait for the
answer before he can move for summary judgment. [64] And like the In the case at bar, petitioner moved for summary judgment after
New York rules, ours do not provide for a fixed reglementary period pre-trial and before its scheduled date for presentation of evidence.
within which to move for summary judgment. Respondent Marcoses argue that, by agreeing to proceed to trial
during the pre-trial conference, petitioner "waived" its right to
This being so, the New York Supreme Court's interpretation of summary judgment.
Rule 113 of the Rules of Civil Practice can be applied by analogy to
the interpretation of Section 1, Rule 35, of our 1997 Rules of Civil This argument must fail in the light of the New York Supreme
Procedure. Court ruling which we apply by analogy to this case. In Ecker,[67] the
defendant opposed the motion for summary judgment on a ground
Under the New York rule, after the issues have been joined, the similar to that raised by the Marcoses, that is, "that plaintiff had
motion for summary judgment may be made at any stage of the waived her right to summary judgment" by her act of proceeding to
litigation. And what exactly does the phrase "at any stage of the trial. If, as correctly ruled by the New York court, plaintiff was allowed
litigation" mean? In Ecker vs. Muzysh,[65] the New York Supreme to move for summary judgment even after trial and submission of the
Court ruled: case for resolution, more so should we permit it in the present case
where petitioner moved for summary judgment before trial.
"PER CURIAM.
Therefore, the phrase "anytime after the pleading in answer
Plaintiff introduced her evidence and the defendants rested on the case made thereto has been served" in Section 1, Rule 35 of our Rules of Civil
by the plaintiff. The case was submitted. Owing to the serious illness of the Procedure means "at any stage of the litigation." Whenever it
trial justice, a decision was not rendered within sixty days after the final becomes evident at any stage of the litigation that no triable issue
adjournment of the term at which the case was tried. With the approval of the exists, or that the defenses raised by the defendant(s) are sham or
trial justice, the plaintiff moved for a new trial under Section 442 of the Civil frivolous, plaintiff may move for summary judgment. A contrary
Practice Act. The plaintiff also moved for summary judgment under Rule interpretation would go against the very objective of the Rule on
113 of the Rules of Civil Practice. The motion was opposed mainly on the Summary Judgment which is to "weed out sham claims or defenses
ground that, by proceeding to trial, the plaintiff had waived her right to thereby avoiding the expense and loss of time involved in a trial."[68]
summary judgment and that the answer and the opposing affidavits raised In cases with political undertones like the one at bar, adverse
triable issues. The amount due and unpaid under the contract is not in parties will often do almost anything to delay the proceedings in the
dispute. The Special Term granted both motions and the defendants have hope that a future administration sympathetic to them might be able to
appealed. influence the outcome of the case in their favor. This is rank injustice
we cannot tolerate.
The Special Term properly held that the answer and the opposing affidavits
raised no triable issue. Rule 113 of the Rules of Civil Practice and the Civil The law looks with disfavor on long, protracted and expensive
Practice Act prescribe no limitation as to the time when a motion for litigation and encourages the speedy and prompt disposition of cases.
summary judgment must be made. The object of Rule 113 is to empower That is why the law and the rules provide for a number of devices to
the court to summarily determine whether or not a bona fide issue exists ensure the speedy disposition of cases. Summary judgment is one of
between the parties, and there is no limitation on the power of the court to them.
make such a determination at any stage of the litigation." (emphasis ours) Faithful therefore to the spirit of the law on summary judgment
which seeks to avoid unnecessary expense and loss of time in a trial,
On the basis of the aforequoted disquisition, "any stage of the we hereby rule that petitioner Republic could validly move for
litigation" means that "even if the plaintiff has proceeded to trial, this summary judgment any time after the respondents answer was filed
does not preclude him from thereafter moving for summary or, for that matter, at any subsequent stage of the litigation. The fact
judgment."[66] that petitioner agreed to proceed to trial did not in any way prevent it
from moving for summary judgment, as indeed no genuine issue of This, respondents failed to bear out. In fact, during the pre-trial
fact was ever validly raised by respondent Marcoses. conference, the Marcoses disclaimed ownership of the Swiss
deposits. Not being the owners, as they claimed, respondents did not
This interpretation conforms with the guiding principle enshrined have any vested right or interest which could be adversely affected by
in Section 6, Rule 1 of the 1997 Rules of Civil Procedure that the petitioner's alleged inaction.
"[r]ules should be liberally construed in order to promote their
objective of securing a just, speedy and inexpensive disposition of But even assuming for the sake of argument that laches had
every action and proceeding."[69] already set in, the doctrine of estoppel or laches does not apply when
the government sues as a sovereign or asserts governmental rights.
Respondents further allege that the motion for summary [73]
Nor can estoppel validate an act that contravenes law or public
judgment was based on respondents' answer and other documents policy.[74]
that had long been in the records of the case. Thus, by the time the
motion was filed on March 10, 2000, estoppel by laches had already As a final point, it must be emphasized that laches is not a mere
set in against petitioner. question of time but is principally a question of the inequity or
unfairness of permitting a right or claim to be enforced or asserted.
We disagree. Estoppel by laches is the failure or neglect for an [75]
Equity demands that petitioner Republic should not be barred from
unreasonable or unexplained length of time to do that which, by pursuing the people's case against the Marcoses.
exercising due diligence, could or should have been done earlier,
warranting a presumption that the person has abandoned his right or (2) The Propriety of Forfeiture
declined to assert it.[70] In effect, therefore, the principle of laches is
The matter of summary judgment having been thus settled, the
one of estoppel because "it prevents people who have slept on their
rights from prejudicing the rights of third parties who have placed issue of whether or not petitioner Republic was able to prove its case
for forfeiture in accordance with the requisites of Sections 2 and 3 of
reliance on the inaction of the original parties and their successors-in-
interest".[71] RA 1379 now takes center stage.
The law raises the prima facie presumption that a property is
A careful examination of the records, however, reveals that
petitioner was in fact never remiss in pursuing its case against unlawfully acquired, hence subject to forfeiture, if its amount or value
is manifestly disproportionate to the official salary and other lawful
respondent Marcoses through every remedy available to it, including
the motion for summary judgment. income of the public officer who owns it. Hence, Sections 2 and 6 of
RA 1379[76] provide:
Petitioner Republic initially filed its motion for summary judgment
on October 18, 1996. The motion was denied because of the pending x x x x x x
compromise agreement between the Marcoses and petitioner. But
during the pre-trial conference, the Marcoses denied ownership of the Section 2. Filing of petition. Whenever any public officer or employee has
Swiss funds, prompting petitioner to file another motion for summary acquired during his incumbency an amount or property which is manifestly
judgment now under consideration by this Court. It was the out of proportion to his salary as such public officer or employee and to his
subsequent events that transpired after the answer was filed, other lawful income and the income from legitimately acquired property, said
therefore, which prevented petitioner from filing the questioned property shall be presumed prima facie to have been unlawfully acquired.
motion. It was definitely not because of neglect or inaction that
petitioner filed the (second) motion for summary judgment years after x x x x x x
respondents' answer to the petition for forfeiture.
In invoking the doctrine of estoppel by laches, respondents must Sec. 6. Judgment If the respondent is unable to show to the satisfaction of the
show not only unjustified inaction but also that some unfair injury to court that he has lawfully acquired the property in question, then the court
them might result unless the action is barred.[72] shall declare such property in question, forfeited in favor of the State, and by
virtue of such judgment the property aforesaid shall become the property of Ferdinand E. Marcos, as President
the State. Provided, That no judgment shall be rendered within six months
before any general election or within three months before any special 1966-1976 at P60,000/year P660,000
election. The Court may, in addition, refer this case to the corresponding
Executive Department for administrative or criminal action, or both. 1977-1984 at P100,000/year 800,000
From the above-quoted provisions of the law, the following facts 1985 at P110,000/year 110,000
must be established in order that forfeiture or seizure of the Swiss
deposits may be effected: P1,570,00
(1) ownership by the public officer of money or Imelda R. Marcos, as Minister

property acquired during his incumbency, whether it be in
his name or otherwise, and June 1976-1985 at P75,000/year P718,000
(2) the extent to which the amount of that money or property In addition to their accumulated salaries from 1966 to 1985 are
exceeds, i. e., is grossly disproportionate to, the legitimate the Marcos couples combined salaries from January to February 1986
income of the public officer. in the amount of P30,833.33. Hence, their total accumulated salaries
amounted to P2,319,583.33. Converted to U.S. dollars on the basis of
That spouses Ferdinand and Imelda Marcos were public officials the corresponding peso-dollar exchange rates prevailing during the
during the time material to the instant case was never in dispute. applicable period when said salaries were received, the total amount
Paragraph 4 of respondent Marcoses' answer categorically admitted had an equivalent value of $304,372.43.
the allegations in paragraph 4 of the petition for forfeiture as to the
personal circumstances of Ferdinand E. Marcos as a public official The dollar equivalent was arrived at by using the official annual
who served without interruption as Congressman, Senator, Senate rates of exchange of the Philippine peso and the US dollar from 1965
President and President of the Republic of the Philippines from to 1985 as well as the official monthly rates of exchange in January
December 1, 1965 to February 25, 1986. [77] Likewise, respondents and February 1986 issued by the Center for Statistical Information of
admitted in their answer the contents of paragraph 5 of the petition as the Bangko Sentral ng Pilipinas.
to the personal circumstances of Imelda R. Marcos who once served
Prescinding from the aforesaid admissions, Section 4, Rule 129
as a member of the Interim Batasang Pambansa from 1978 to 1984
of the Rules of Court provides that:
and as Metro Manila Governor, concurrently Minister of Human
Settlements, from June 1976 to February 1986.[78]
Section 4. Judicial admissions An admission, verbal or written, made by a
Respondent Mrs. Marcos also admitted in paragraph 10 of her party in the course of the proceedings in the same case does not require
answer the allegations of paragraph 11 of the petition for forfeiture proof. The admission may be contradicted only by showing that it was made
which referred to the accumulated salaries of respondents Ferdinand through palpable mistake or that no such admission was made.[81]
E. Marcos and Imelda R. Marcos. [79] The combined accumulated
salaries of the Marcos couple were reflected in the Certification dated It is settled that judicial admissions may be made: (a) in the
May 27, 1986 issued by then Minister of Budget and Management pleadings filed by the parties; (b) in the course of the trial either by
Alberto Romulo.[80] The Certification showed that, from 1966 to 1985, verbal or written manifestations or stipulations; or (c) in other stages
Ferdinand E. Marcos and Imelda R. Marcos had accumulated salaries of judicial proceedings, as in the pre-trial of the case. [82] Thus, facts
in the amount of P1,570,000 and P718,750, respectively, or a total pleaded in the petition and answer, as in the case at bar, are deemed
of P2,288,750: admissions of petitioner and respondents, respectively, who are not
permitted to contradict them or subsequently take a position contrary Respondents argue that petitioner was not able to establish
to or inconsistent with such admissions.[83] a prima facie case for the forfeiture of the Swiss funds since it failed to
prove the essential elements under Section 3, paragraphs (c), (d) and
The sum of $304,372.43 should be held as the only known lawful (e) of RA 1379. As the Act is a penal statute, its provisions are
income of respondents since they did not file any Statement of Assets mandatory and should thus be construed strictly against the petitioner
and Liabilities (SAL), as required by law, from which their net worth and liberally in favor of respondent Marcoses.
could be determined. Besides, under the 1935 Constitution, Ferdinand
E. Marcos as President could not receive any other emolument from We hold that it was not for petitioner to establish the Marcoses
the Government or any of its subdivisions and instrumentalities. other lawful income or income from legitimately acquired property for
[84]
Likewise, under the 1973 Constitution, Ferdinand E. Marcos as the presumption to apply because, as between petitioner and
President could not receive during his tenure any other emolument respondents, the latter were in a better position to know if there were
from the Government or any other source.[85] In fact, his management such other sources of lawful income. And if indeed there was such
of businesses, like the administration of foundations to accumulate other lawful income, respondents should have specifically stated the
funds, was expressly prohibited under the 1973 Constitution: same in their answer. Insofar as petitioner Republic was concerned, it
was enough to specify the known lawful income of respondents.
Article VII, Sec. 4(2) The President and the Vice-President shall not, during
Section 9 of the PCGG Rules and Regulations provides that, in
their tenure, hold any other office except when otherwise provided in this
determining prima facie evidence of ill-gotten wealth, the value of the
Constitution, nor may they practice any profession, participate directly or
accumulated assets, properties and other material possessions of
indirectly in the management of any business, or be financially interested
those covered by Executive Order Nos. 1 and 2
directly or indirectly in any contract with, or in any franchise or special
must be out of proportion to the known lawful income of such
privilege granted by the Government or any other subdivision, agency, or
persons. The respondent Marcos couple did not file any Statement of
instrumentality thereof, including any government owned or controlled
Assets and Liabilities (SAL) from which their net worth could be
corporation.
determined. Their failure to file their SAL was in itself a violation of law
and to allow them to successfully assail the Republic for not
Article VII, Sec. 11 No Member of the National Assembly shall appear as presenting their SAL would reward them for their violation of the law.
counsel before any court inferior to a court with appellate jurisdiction, x x
x. Neither shall he, directly or indirectly, be interested financially in any Further, contrary to the claim of respondents, the admissions
contract with, or in any franchise or special privilege granted by the made by them in their various pleadings and documents were valid. It
Government, or any subdivision, agency, or instrumentality thereof including is of record that respondents judicially admitted that the money
any government owned or controlled corporation during his term of deposited with the Swiss banks belonged to them.
office. He shall not intervene in any matter before any office of the
We agree with petitioner that respondent Marcoses made judicial
government for his pecuniary benefit.
admissions of their ownership of the subject Swiss bank deposits in
their answer, the General/Supplemental Agreements, Mrs. Marcos'
Article IX, Sec. 7 The Prime Minister and Members of the Cabinet shall be Manifestation and Constancia dated May 5, 1999, and the
subject to the provision of Section 11, Article VIII hereof and may not Undertaking dated February 10, 1999. We take note of the fact that
appear as counsel before any court or administrative body, or manage any the Associate Justices of the Sandiganbayan were unanimous in
business, or practice any profession, and shall also be subject to such other holding that respondents had made judicial admissions of their
disqualification as may be provided by law. ownership of the Swiss funds.
Their only known lawful income of $304,372.43 can therefore In their answer, aside from admitting the existence of the subject
legally and fairly serve as basis for determining the existence of funds, respondents likewise admitted ownership thereof. Paragraph
a prima facie case of forfeiture of the Swiss funds. 22 of respondents' answer stated:
22. Respondents specifically DENY PARAGRAPH 23 insofar as it alleges Respondents make much capital of the pronouncement by this
that respondents clandestinely stashed the country's wealth in Switzerland Court that the General and Supplemental Agreements were null and
and hid the same under layers and layers of foundations and corporate void.[89] They insist that nothing in those agreements could thus be
entities for being false, the truth being that respondents' aforesaid admitted in evidence against them because they stood on the same
properties were lawfully acquired. (emphasis supplied) ground as an accepted offer which, under Section 27, Rule 130[90] of
the 1997 Rules of Civil Procedure, provides that in civil cases, an offer
By qualifying their acquisition of the Swiss bank deposits as of compromise is not an admission of any liability and is not
lawful, respondents unwittingly admitted their ownership thereof. admissible in evidence against the offeror.
Respondent Mrs. Marcos also admitted ownership of the Swiss We find no merit in this contention. The declaration of nullity of
bank deposits by failing to deny under oath the genuineness and due said agreements was premised on the following constitutional and
execution of certain actionable documents bearing her signature statutory infirmities: (1) the grant of
attached to the petition. As discussed earlier, Section 11, Rule 8 [86] of criminal immunityto the Marcos heirs was against the law; (2) the
the 1997 Rules of Civil Procedure provides that material averments in PCGGs commitment to exempt from all forms of taxes the properties
the complaint shall be deemed admitted when not specifically denied. to be retained by the Marcos heirs was against the Constitution; and
(3) the governments undertaking to cause the dismissal of all cases
The General[87] and Supplemental[88] Agreements executed by filed against the Marcoses pending before the Sandiganbayan and
petitioner and respondents on December 28, 1993 further bolstered other courts encroached on the powers of the judiciary. The reasons
the claim of petitioner Republic that its case for forfeiture was proven relied upon by the Court never in the least bit even touched on the
in accordance with the requisites of Sections 2 and 3 of RA 1379. The veracity and truthfulness of respondents admission with respect to
whereas clause in the General Agreement declared that: their ownership of the Swiss funds. Besides, having made certain
admissions in those agreements, respondents cannot now deny that
WHEREAS, the FIRST PARTY has obtained a judgment from the Swiss they voluntarily admitted owning the subject Swiss funds,
Federal Tribunal on December 21, 1990, that the $356 million belongs in notwithstanding the fact that the agreements themselves were later
principle to the Republic of the Philippines provided certain conditionalities declared null and void.
are met, but even after 7 years, the FIRST PARTY has not been able to
procure a final judgment of conviction against the PRIVATE PARTY. The following observation of Sandiganbayan Justice Catalino
Castaeda, Jr. in the decision dated September 19, 2000 could not
While the Supplemental Agreement warranted, inter alia, that: have been better said:
In consideration of the foregoing, the parties hereby agree that the PRIVATE x x x The declaration of nullity of the two agreements rendered the same
PARTY shall be entitled to the equivalent of 25% of the amount that may be without legal effects but it did not detract from the admissions of the
eventually withdrawn from said $356 million Swiss deposits. respondents contained therein. Otherwise stated, the admissions made in said
agreements, as quoted above, remain binding on the respondents.[91]
The stipulations set forth in the General and Supplemental
Agreements undeniably indicated the manifest intent of respondents A written statement is nonetheless competent as an admission
to enter into a compromise with petitioner. Corollarily, respondents even if it is contained in a document which is not itself effective for the
willingness to agree to an amicable settlement with the Republic only purpose for which it is made, either by reason of illegality, or
affirmed their ownership of the Swiss deposits for the simple reason incompetency of a party thereto, or by reason of not being signed,
that no person would acquiesce to any concession over such huge executed or delivered. Accordingly, contracts have been held as
dollar deposits if he did not in fact own them. competent evidence of admissions, although they may be
unenforceable.[92]
The testimony of respondent Ferdinand Marcos, Jr. during the My reaction to all of these approaches is that I am
hearing on the motion for the approval of the Compromise Agreement always open, we are always open, we are very much
on April 29, 1998 also lent credence to the allegations of petitioner always in search of resolution to the problem of the
Republic that respondents admitted ownership of the Swiss bank family and any approach that has been made us, we
accounts. We quote the salient portions of Ferdinand Jr.s formal have entertained. And so my reaction was the same as
declarations in open court: what I have always why not? Maybe this is the one that
will finally put an end to this problem.[94]
ATTY. FERNANDO:
xxx xxx xxx
Mr. Marcos, did you ever have any meetings with
PCGG Chairman Magtanggol C. Gunigundo? ATTY. FERNANDO:
F. MARCOS, JR.: Basically, what were the true amounts of the
assets in the bank?
Yes. I have had very many meetings in fact with
Chairman. PJ GARCHITORENA:
ATTY. FERNANDO: So, we are talking about liquid assets here? Just
Cash?
Would you recall when the first meeting occurred?
F. MARCOS, JR.:
PJ GARCHITORENA:
Well, basically, any assets. Anything that was
In connection with what? under the Marcos name in any of the banks in
ATTY. FERNANDO: Switzerland which may necessarily be not cash.[95]
In connection with the ongoing talks to xxx xxx xxx
compromise the various cases initiated by PCGG PJ GARCHITORENA:
against your family?
x x x What did you do in other words, after being
F. MARCOS, JR.: apprised of this contract in connection herewith?
The nature of our meetings was solely concerned F. MARCOS, JR.:
with negotiations towards achieving some kind of
agreement between the Philippine government and the I assumed that we are beginning to implement the
Marcos family. The discussions that led up to the agreement because this was forwarded through the
compromise agreement were initiated by our then Philippine government lawyers through our lawyers and
counsel Atty. Simeon Mesina x x x.[93] then, subsequently, to me.I was a little surprised
because we hadnt really discussed the details of the
xxx xxx xxx transfer of the funds, what the bank accounts, what the
ATTY. FERNANDO: mechanism would be. But nevertheless, I was happy to
see that as far as the PCGG is concerned, that the
What was your reaction when Atty. Mesina informed you agreement was perfected and that we were beginning to
of this possibility? implement it and that was a source of satisfaction to me
F. MARCOS, JR.: because I thought that finally it will be the end.[96]
Ferdinand Jr.'s pronouncements, taken in context and in their the subsequent release and transfer of the $150 million to the rightful
entirety, were a confirmation of respondents recognition of their owner. She further made the following manifestations:
ownership of the Swiss bank deposits. Admissions of a party in his
testimony are receivable against him. If a party, as a witness, xxx xxx xxx
deliberately concedes a fact, such concession has the force of a
judicial admission.[97] It is apparent from Ferdinand Jr.s testimony that 2. The Republics cause of action over the full amount is its forfeiture in favor
the Marcos family agreed to negotiate with the Philippine government of the government if found to be ill-gotten. On the other hand, the Marcoses
in the hope of finally putting an end to the problems besetting the defend that it is a legitimate asset. Therefore, both parties have an inchoate
Marcos family regarding the Swiss accounts. This was doubtlessly an right of ownership over the account. If it turns out that the account is of
acknowledgment of ownership on their part. The rule is that the lawful origin, the Republic may yield to the Marcoses. Conversely, the
testimony on the witness stand partakes of the nature of a formal Marcoses must yield to the Republic. (underscoring supplied)
judicial admission when a party testifies clearly and unequivocally to a
fact which is peculiarly within his own knowledge.[98] xxx xxx xxx
[99]
In her Manifestation dated May 26, 1998, respondent Imelda
Marcos furthermore revealed the following: 3. Consistent with the foregoing, and the Marcoses having committed
themselves to helping the less fortunate, in the interest of peace,
That respondent Imelda R. Marcos owns 90% of the subject matter of the reconciliation and unity, defendant MADAM IMELDA ROMUALDEZ
above-entitled case, being the sole beneficiary of the dollar deposits in the MARCOS, in firm abidance thereby, hereby affirms her agreement with the
name of the various foundations alleged in the case; Republic for the release and transfer of the US Dollar 150 million for proper
disposition, without prejudice to the final outcome of the litigation respecting
That in fact only 10% of the subject matter in the above-entitled case belongs the ownership of the remainder.
to the estate of the late President Ferdinand E. Marcos;
Again, the above statements were indicative of Imeldas
xxx xxx xxx admission of the Marcoses ownership of the Swiss deposits as in fact
the Marcoses defend that it (Swiss deposits) is a legitimate (Marcos)
asset.
Respondents ownership of the Swiss bank accounts as borne out
by Mrs. Marcos' manifestation is as bright as sunlight. And her claim On the other hand, respondents Maria Imelda Marcos-Manotoc,
that she is merely a beneficiary of the Swiss deposits is belied by her Ferdinand Marcos, Jr. and Maria Irene Marcos-Araneta filed a
own signatures on the appended copies of the documents motion[102] on May 4, 1998 asking the Sandiganbayan to place
substantiating her ownership of the funds in the name of the the res (Swiss deposits) in custodia legis:
foundations. As already mentioned, she failed to specifically deny
under oath the authenticity of such documents, especially those 7. Indeed, the prevailing situation is fraught with danger! Unless the
involving William Saunders and Jane Ryan which actually referred to aforesaid Swiss deposits are placed in custodia legis or within the Courts
Ferdinand Marcos and Imelda Marcos, respectively. That failure of protective mantle, its dissipation or misappropriation by the petitioner looms
Imelda Marcos to specifically deny the existence, much less the as a distinct possibility.
genuineness and due execution, of the instruments bearing her
signature, was tantamount to a judicial admission of the genuineness Such display of deep, personal interest can only come from
and due execution of said instruments, in accordance with Section 8, someone who believes that he has a marked and intimate right over
Rule 8[100] of the 1997 Rules of Civil Procedure. the considerable dollar deposits. Truly, by filing said motion, the
Likewise, in her Constancia [101] dated May 6, 1999, Imelda Marcos children revealed their ownership of the said deposits.
Marcos prayed for the approval of the Compromise Agreement and
Lastly, the Undertaking[103] entered into by the PCGG, the PNB party or not.[104] This doctrine is embodied in Section 4, Rule 129 of
and the Marcos foundations on February 10, 1999, confirmed the the Rules of Court:
Marcoses ownership of the Swiss bank deposits. The subject
Undertaking brought to light their readiness to pay the human rights SEC. 4. Judicial admissions. ─ An admission, verbal or written, made by a
victims out of the funds held in escrow in the PNB. It stated: party in the course of the proceedings in the same case, does not require
proof. The admission may be contradicted only by showing that it was made
WHEREAS, the Republic of the Philippines sympathizes with the plight of through palpable mistake or that no such admission was made.[105]
the human rights victims-plaintiffs in the aforementioned litigation through
the Second Party, desires to assist in the satisfaction of the judgment awards In the absence of a compelling reason to the contrary,
of said human rights victims-plaintiffs, by releasing, assigning and or respondents judicial admission of ownership of the Swiss deposits is
waiving US$150 million of the funds held in escrow under the Escrow definitely binding on them.
Agreements dated August 14, 1995, although the Republic is not obligated to
do so under final judgments of the Swiss courts dated December 10 and 19, The individual and separate admissions of each respondent bind
1997, and January 8, 1998; all of them pursuant to Sections 29 and 31, Rule 130 of the Rules of
Court:
WHEREAS, the Third Party is likewise willing to release, assign and/or
waive all its rights and interests over said US$150 million to the SEC. 29. Admission by co-partner or agent. ─ The act or declaration of a
aforementioned human rights victims-plaintiffs. partner or agent of the party within the scope of his authority and during the
existence of the partnership or agency, may be given in evidence against such
party after the partnership or agency is shown by evidence other than such
All told, the foregoing disquisition negates the claim of
act or declaration. The same rule applies to the act or declaration of a joint
respondents that petitioner failed to prove that they acquired or own
owner, joint debtor, or other person jointly interested with the party.[106]
the Swiss funds and that it was only by arbitrarily isolating and taking
certain statements made by private respondents out of context that
petitioner was able to treat these as judicial admissions. The Court is SEC. 31. Admission by privies. ─ Where one derives title to property from
fully aware of the relevance, materiality and implications of every another, the act, declaration, or omission of the latter, while holding the title,
pleading and document submitted in this case. This Court carefully in relation to the property, is evidence against the former.[107]
scrutinized the proofs presented by the parties. We analyzed,
assessed and weighed them to ascertain if each piece of evidence The declarations of a person are admissible against a party
rightfully qualified as an admission. Owing to the far-reaching whenever a privity of estate exists between the declarant and the
historical and political implications of this case, we considered and party, the term privity of estate generally denoting a succession in
examined, individually and totally, the evidence of the parties, even if rights.[108] Consequently, an admission of one in privity with a party to
it might have bordered on factual adjudication which, by authority of the record is competent.[109] Without doubt, privity exists among the
the rules and jurisprudence, is not usually done by this Court. There is respondents in this case. And where several co-parties to the record
no doubt in our mind that respondent Marcoses admitted ownership of are jointly interested in the subject matter of the controversy, the
the Swiss bank deposits. admission of one is competent against all.[110]
We have always adhered to the familiar doctrine that an Respondents insist that the Sandiganbayan is correct in ruling
admission made in the pleadings cannot be controverted by the party that petitioner Republic has failed to establish a prima facie case for
making such admission and becomes conclusive on him, and that all the forfeiture of the Swiss deposits.
proofs submitted by him contrary thereto or inconsistent therewith We disagree. The sudden turn-around of the Sandiganbayan was
should be ignored, whether an objection is interposed by the adverse really strange, to say the least, as its findings and conclusions were
not borne out by the voluminous records of this case.
Section 2 of RA 1379 explicitly states that whenever any public deposits amounting to US $356 million representing the balance of
officer or employee has acquired during his incumbency an amount of the Swiss accounts of the five foundations, an amount way, way
property which is manifestly out of proportion to his salary as such beyond their aggregate legitimate income of only US$304,372.43
public officer or employee and to his other lawful income and the during their incumbency as government officials.
income from legitimately acquired property, said property shall be
Considering, therefore, that the total amount of the Swiss
presumed prima facie to have been unlawfully acquired. x x x
deposits was considerably out of proportion to the known lawful
The elements which must concur for this prima facie presumption income of the Marcoses, the presumption that said dollar deposits
to apply are: were unlawfully acquired was duly established. It was sufficient for the
petition for forfeiture to state the approximate amount of money and
(1) the offender is a public officer or employee; property acquired by the respondents, and their total government
(2) he must have acquired a considerable amount of money or salaries. Section 9 of the PCGG Rules and Regulations states:
property during his incumbency; and
Prima Facie Evidence. Any accumulation of assets, properties, and other
(3) said amount is manifestly out of proportion to his salary as material possessions of those persons covered by Executive Orders No. 1 and
such public officer or employee and to his other lawful No. 2, whose value is out of proportion to their known lawful income
income and the income from legitimately acquired is prima facie deemed ill-gotten wealth.
property.
It is undisputed that spouses Ferdinand and Imelda Marcos were Indeed, the burden of proof was on the respondents to dispute
former public officers. Hence, the first element is clearly extant. this presumption and show by clear and convincing evidence that the
Swiss deposits were lawfully acquired and that they had other
The second element deals with the amount of money or property legitimate sources of income. A presumption is prima facie proof of
acquired by the public officer during his incumbency. The Marcos the fact presumed and, unless the fact thus prima facie established by
couple indubitably acquired and owned properties during their term of legal presumption is disproved, it must stand as proved.[111]
office. In fact, the five groups of Swiss accounts were admittedly
owned by them. There is proof of the existence and ownership of Respondent Mrs. Marcos argues that the foreign foundations
these assets and properties and it suffices to comply with the second should have been impleaded as they were indispensable parties
element. without whom no complete determination of the issues could be
made. She asserts that the failure of petitioner Republic to implead
The third requirement is met if it can be shown that such assets, the foundations rendered the judgment void as the joinder of
money or property is manifestly out of proportion to the public officers indispensable parties was a sine qua non exercise of judicial
salary and his other lawful income. It is the proof of this third element power. Furthermore, the non-inclusion of the foreign foundations
that is crucial in determining whether a prima facie presumption has violated the conditions prescribed by the Swiss government regarding
been established in this case. the deposit of the funds in escrow, deprived them of their day in court
Petitioner Republic presented not only a schedule indicating the and denied them their rights under the Swiss constitution and
lawful income of the Marcos spouses during their incumbency but also international law.[112]
evidence that they had huge deposits beyond such lawful income in The Court finds that petitioner Republic did not err in not
Swiss banks under the names of five different foundations. We impleading the foreign foundations. Section 7, Rule 3 of the 1997
believe petitioner was able to establish the prima facie presumption Rules of Civil Procedure,[113] taken from Rule 19b of the American
that the assets and properties acquired by the Marcoses Federal Rules of Civil Procedure, provides for the compulsory joinder
were manifestly and patently disproportionate to their aggregate of indispensable parties. Generally, an indispensable party must be
salaries as public officials. Otherwise stated, petitioner presented impleaded for the complete determination of the suit. However, failure
enough evidence to convince us that the Marcoses had dollar
to join an indispensable party does not divest the court of jurisdiction proceedings hinged on the assumption that they owned a nominal
since the rule regarding indispensable parties is founded on equitable share of the assets.[118] But this was already refuted by no less than
considerations and is not jurisdictional. Thus, the court is not divested Mrs. Marcos herself. Thus, she cannot now argue that the ruling of the
of its power to render a decision even in the absence of indispensable Sandiganbayan violated the conditions set by the Swiss court. The
parties, though such judgment is not binding on the non-joined party. directive given by the Swiss court for the foundations to participate in
[114]
the proceedings was for the purpose of protecting whatever nominal
interest they might have had in the assets as formal owners. But
An indispensable party[115] has been defined as one: inasmuch as their ownership was subsequently repudiated by Imelda
Marcos, they could no longer be considered as indispensable parties
[who] must have a direct interest in the litigation; and if this interest is such and their participation in the proceedings became unnecessary.
that it cannot be separated from that of the parties to the suit, if the court
cannot render justice between the parties in his absence, if the decree will In Republic vs. Sandiganbayan,[119] this Court ruled that
have an injurious effect upon his interest, or if the final determination of the impleading the firms which are the res of the action was unnecessary:
controversy in his absence will be inconsistent with equity and good
conscience. And as to corporations organized with ill-gotten wealth, but are not
themselves guilty of misappropriation, fraud or other illicit conduct in other
There are two essential tests of an indispensable party: (1) can words, the companies themselves are not the object or thing involved in the
relief be afforded the plaintiff without the presence of the other party? action, the res thereof there is no need to implead them either. Indeed, their
and (2) can the case be decided on its merits without prejudicing the impleading is not proper on the strength alone of their having been formed
rights of the other party?[116] There is, however, no fixed formula for with ill-gotten funds, absent any other particular wrongdoing on their part
determining who is an indispensable party; this can only be
determined in the context and by the facts of the particular suit or Such showing of having been formed with, or having received ill-gotten
litigation. funds, however strong or convincing, does not, without more, warrant
identifying the corporations in question with the person who formed or made
In the present case, there was an admission by respondent use of them to give the color or appearance of lawful, innocent acquisition to
Imelda Marcos in her May 26, 1998 Manifestation before the illegally amassed wealth at the least, not so as place on the Government
Sandiganbayan that she was the sole beneficiary of 90% of the the onus of impleading the former with the latter in actions to recover such
subject matter in controversy with the remaining 10% belonging to the wealth. Distinguished in terms of juridical personality and legal culpability
estate of Ferdinand Marcos.[117] Viewed against this admission, the from their erring members or stockholders, said corporations are not
foreign foundations were not indispensable parties. Their non- themselves guilty of the sins of the latter, of the embezzlement, asportation,
participation in the proceedings did not prevent the court from etc., that gave rise to the Governments cause of action for recovery; their
deciding the case on its merits and according full relief to petitioner creation or organization was merely the result of their members (or
Republic. The judgment ordering the return of the $356 million was stockholders) manipulations and maneuvers to conceal the illegal origins of
neither inimical to the foundations interests nor inconsistent with the assets or monies invested therein. In this light, they are simply the res in
equity and good conscience. The admission of respondent Imelda the actions for the recovery of illegally acquired wealth, and there is, in
Marcos only confirmed what was already generally known: that the principle, no cause of action against them and no ground to implead them as
foundations were established precisely to hide the money stolen by defendants in said actions.
the Marcos spouses from petitioner Republic. It negated whatever
illusion there was, if any, that the foreign foundations owned even a
Just like the corporations in the aforementioned case, the foreign
nominal part of the assets in question.
foundations here were set up to conceal the illegally acquired funds of
The rulings of the Swiss court that the foundations, as formal the Marcos spouses. Thus, they were simply the res in the action for
owners, must be given an opportunity to participate in the
recovery of ill-gotten wealth and did not have to be impleaded for lack Likewise, jurisprudence on the Federal Rules of Procedure, from
of cause of action or ground to implead them. which our Section 7, Rule 3[124] on indispensable parties was copied,
allows the joinder of indispensable parties even after judgment has
Assuming arguendo, however, that the foundations were been entered if such is needed to afford the moving party full relief.
indispensable parties, the failure of petitioner to implead them was a [125]
Mere delay in filing the joinder motion does not necessarily result
curable error, as held in the previously cited case of Republic vs. in the waiver of the right as long as the delay is excusable. [126] Thus,
Sandiganbayan:[120] respondent Mrs. Marcos cannot correctly argue that the judgment
rendered by the Sandiganbayan was void due to the non-joinder of
Even in those cases where it might reasonably be argued that the failure of the foreign foundations. The court had jurisdiction to render judgment
the Government to implead the sequestered corporations as defendants is which, even in the absence of indispensable parties, was binding on
indeed a procedural abberation, as where said firms were allegedly used, and all the parties before it though not on the absent party. [127] If she really
actively cooperated with the defendants, as instruments or conduits for felt that she could not be granted full relief due to the absence of the
conversion of public funds and property or illicit or fraudulent obtention of foreign foundations, she should have moved for their inclusion, which
favored government contracts, etc., slight reflection would nevertheless lead was allowable at any stage of the proceedings. She never did. Instead
to the conclusion that the defect is not fatal, but one correctible under she assailed the judgment rendered.
applicable adjective rules e.g., Section 10, Rule 5 of the Rules of Court
[specifying the remedy of amendment during trial to authorize or to conform In the face of undeniable circumstances and the avalanche of
to the evidence]; Section 1, Rule 20 [governing amendments before trial], in documentary evidence against them, respondent Marcoses failed to
relation to the rule respecting omission of so-called necessary or justify the lawful nature of their acquisition of the said assets. Hence,
indispensable parties, set out in Section 11, Rule 3 of the Rules of Court. It is the Swiss deposits should be considered ill-gotten wealth and
relevant in this context to advert to the old familiar doctrines that the forfeited in favor of the State in accordance with Section 6 of RA
omission to implead such parties is a mere technical defect which can be 1379:
cured at any stage of the proceedings even after judgment; and that,
particularly in the case of indispensable parties, since their presence and SEC. 6. Judgment.─ If the respondent is unable to show to the satisfaction of
participation is essential to the very life of the action, for without them no the court that he has lawfully acquired the property in question, then the
judgment may be rendered, amendments of the complaint in order to implead court shall declare such property forfeited in favor of the State, and by virtue
them should be freely allowed, even on appeal, in fact even after rendition of of such judgment the property aforesaid shall become property of the State x
judgment by this Court, where it appears that the complaint otherwise x x.
indicates their identity and character as such indispensable parties.[121]
Although there are decided cases wherein the non-joinder of THE FAILURE TO PRESENT AUTHENTICATED
indispensable parties in fact led to the dismissal of the suit or the TRANSLATIONS OF THE SWISS DECISIONS
annulment of judgment, such cases do not jibe with the matter at
hand. The better view is that non-joinder is not a ground to dismiss
the suit or annul the judgment. The rule on joinder of indispensable Finally, petitioner Republic contends that the Honorable
parties is founded on equity. And the spirit of the law is reflected in Sandiganbayan Presiding Justice Francis Garchitorena committed
Section 11, Rule 3[122] of the 1997 Rules of Civil Procedure. It prohibits grave abuse of discretion in reversing himself on the ground that the
the dismissal of a suit on the ground of non-joinder or misjoinder of original copies of the authenticated Swiss decisions and their
parties and allows the amendment of the complaint at any stage of the authenticated translations were not submitted to the court a
proceedings, through motion or on order of the court on its own quo. Earlier PJ Garchitorena had quoted extensively from the
initiative.[123] unofficial translation of one of these Swiss decisions in
his ponencia dated July 29, 1999 when he denied the motion to
release US$150 Million to the human rights victims.
While we are in reality perplexed by such an incomprehensible
change of heart, there might nevertheless not be any real need to
belabor the issue. The presentation of the authenticated translations
of the original copies of the Swiss decision was not de rigueur for the
public respondent to make findings of fact and reach its conclusions.
In short, the Sandiganbayans decision was not dependent on the
determination of the Swiss courts. For that matter, neither is this
Courts.
The release of the Swiss funds held in escrow in the PNB is
dependent solely on the decision of this jurisdiction that said funds
belong to the petitioner Republic. What is important is our own
assessment of the sufficiency of the evidence to rule in favor of either
petitioner Republic or respondent Marcoses. In this instance, despite
the absence of the authenticated translations of the Swiss decisions,
the evidence on hand tilts convincingly in favor of petitioner Republic.
WHEREFORE, the petition is hereby GRANTED. The assailed Resolution

of the Sandiganbayan dated January 31, 2002 is SET ASIDE. The Swiss
deposits which were transferred to and are now deposited in escrow at the
Philippine National Bank in the estimated aggregate amount of
US$658,175,373.60 as of January 31, 2002, plus interest, are hereby forfeited
in favor of petitioner Republic of the Philippines.
SO ORDERED.

Republic v. Sandiganbayan

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EN BANC (1)

Azio-Verso-Vibur Foundation accounts;

ISSUES BEFORE THIS COURT xxx

4. Respondent Ferdinand E. Marcos (now deceased and represented by his

L. MALER FOUNDATION ACCOUNTS x x x x x x.[27]

x x x The adverse party may serve opposing affidavits, depositions, or PJ Garchitorena:

(1) ownership by the public officer of money or Imelda R. Marcos, as Minister

WHEREFORE, the petition is hereby GRANTED. The assailed Resolution

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