Case No. 0033(F) | Presidential Commission on Good Government

Title: RP vs. Eduardo Cojuangco, Jr., et al.
Respondents: Eduardo Cojuangco, Jr., Ferdinand E. Marcos (deceased), Imelda Marcos, Edgardo J. Angara, Jose C. Concepction, Avelino V. Cruz, Eduardo U. Escueta, Paraja G. Hayudini, Juan Ponce Enrile, Teodoro D. Regala, Danilo Ursua, Rogelio A. Vinluan, Agricultural Consultancy, Services, Inc., Anglo Ventures, Inc., Archipelago Realty Corp., Ap Holdings, Inc., ASR Investment, Inc., ASC Investment Inc., Autonomous Development Corp., Balete Ranch, Inc., Black Stallion Ranch, Inc., Cagayan De Oro Oil Company, Inc, Christensen Plantation Company Cocoa Investors, Inc., Davao Agricultural Aviation, Inc., Discovery Realty Corp., Dream Pastures, Inc., Echo Ranch, Inc., ECJ & Sons Agri. Ent. Inc., Far East Ranch, Inc., Filsov Shipping Co., Inc., First Meridian Development, Inc., First United Transport, Inc., Granexport Manufacturing Corp., Habagat Realty Dev’t. Inc., Hyco Agricultural, Inc., Iligan Coconut Industries, Inc., Kalawakan Resorts, Inc., Kaunlaran Agricultural Corp., Labayog Air Terminals, Inc., Landair Int’l Marketing Corp., Legaspi Oil Co., Inc., LHL Cattle Corp., Meadow Lark Plantation, Inc., Metroplex Commodities, Inc., Misty Montains Agri Corp., Northern Carriers Corp., Northeast Contract Traders, Inc., Ocean Side Maritime Ent., Inc., Oro Verde Services, Pastoral Farms, Inc., PCY Oil Manufacturing Corp., Philippine Radio Corp., Inc., Philippine Technologies, Inc., Primaver Farms, Inc., Punong Bayan Housing Development Corp., Pura Electric Co., Inc., Radio Audience Developers Integrated Organization, Inc., Radio Filipino Corp., Rancho Grande, Inc., Randy Allied Ventures, Inc., Reddee Developers, Inc., Roxas Shares, Inc., San Esteban Development Corp., San Miguel Corporation Officers, Inc., San Pablo Manufacturing Corp., Southern Luzon Oil Mills, Inc., Silver Leaf Plantation, Inc., Soriano Shares, Inc., Southern Services Traders, Inc., Southern Star Cattle Corp., Spade I Resorts Corp., Tagum Agricultural Development Corp., Tedeum Resources, Inc., Thilagro Edible Oil Mills, Inc., Toda Holdings, Inc., Unexplored Land Developers, Inc., Valhalla Properties, Inc., Ventures Securities, Inc., Verdant Plantations, Inc., Vesta Agricultural Corp. Wings
Court: Sandiganbayan
Nature of the case: Reconveyance, Reversion, Accounting and Damages
RE: ACQUISITION OF SAN MIGUEL CORPORATION (SMC)
Date filed: Original Complaint July 31, 1987 Subdivided Complaint Mar. 7, 1995

Summary of Complaint: This case involves the SMC shares registered under the names of Eduardo Cojuangco, Jr. et. al. and the CIIF companies which the government sought to recover from defendants.

This stemmed from an Agreement dated 26 March 1986 between the 14 CIIF Holding Companies (UCPB Group), as sellers, and Andres Soriano Soriano III of the SMC Group, as buyer, for the purchase of 33,133,266 shares of SMC stock in the amount of P3,313,326,600.00 payable in 4 installments. The first installment in the amount of P500 Million was paid by SMC Group on 1 April 1986. Before the perfection of the sale or on 7 April 1986, said share were sequestered by PCGG. Thus, the SMC group suspended payment of the purchase price of the shares, while the UCPB group rescinded the sale. Later, the SMC and UCPB groups entered into a Compromise Agreement and Amicable Settlement, whereby they undertook to continue with the sale of the subject shares of stock. The parties, over the opposition of both the Republic and the COCOFED, then moved for the approval of this agreement by the Sandiganbayan where the case was then pending. Later, UCPB and the SMC groups implemented their agreement extra-judicially, withdrawing, at the same time, their petition for the approval of their aforementioned compromise agreement. This was treated as an incident of Civil Case No. 0033-F. Thereafter, the Sandiganbayan issued an Order dated August 5, 1991, directing the SMC to deliver to the graft court the sequestered SMC shares that it bought from UCPB. On October 25, 1991, the Sandiganbayan issued another Resolution requiring SMC to deliver the 25.45 million SMC treasury shares to the PCGG. This was followed by another Order dated March 18, 1992, for the delivery to the court of dividends pertaining to the subject SMC shares. It was these two delivery Orders that were submitted for the consideration of the Supreme Court in G.R. No. 104637-38 but the same was dismissed on 14 September 2000. Motion for Reconsideration thereof was denied on 17 April 2001.

Status:

A. The ECJ-SMC Block

In a Decision dated 12 April 2011 in GR. No. 166859, 169203 and 1880702, the Supreme Court affirmed with finality the Decision promulgated by the Sandiganbayan on 28 November 2007 which declared that the Cojuangco Block of SMC shares are the exclusive property of Cojuangco, et. al.

This judgment became final and executory and recorded in the Book of Entries of Judgments as per entry of Judgment dated 16 March 2012.

B. The CIIF SMC Block

In the above-mentioned Decision in G.R. No. 177857-58 and 178193 (please see Civil Case 0033-A), the Supreme Court also declared that the 6 CIIF companies namely:

1. Southern Luzon Coconut Oil Mills (SOLCOM);

2. Cagayan de Oro Oil Co., Inc. (CAGOIL);

3. Iligan Coconut Industries, Inc. (ILICOCO);

4. San Pablo Manufacturing Corp. (SPMC);

5. Granexport Manufacturing Corp. (GRANEX); and

6. Legaspi Oil Co., Inc. (LEGOIL),

as well as the 14 holding companies namely :

Soriano Shares, Inc.;
ACS Investors, Inc.;
Roxas Shares, Inc.;
Arc Investors; Inc.;
Toda Holdings, Inc.;
AP Holdings, Inc.;
Fernandez Holdings, Inc.;
SMC Officers Corps, Inc.;
Te Deum Resources, Inc.;
Anglo Ventures, Inc.;
Randy Allied Ventures, Inc.;
Rock Steel Resources, Inc.;
Valhalla Properties Ltd., Inc.; and
First Meridian Development, Inc.

and the CIIF Block of San Miguel Shares (SMC) shares of stock totaling 33,133,266 shares as of 1983 together with all dividends declared, paid and issued thereon as well as any increments thereto arising from, but not limited to, exercise of pre-emptive rights are declared owned by the government to be used only for the benefit of all coconut farmers and for the development of the coconut industry, and ordered reconveyed to the government.

However, in its 4 September 2012 Resolution, the Supreme Court modified its earlier judgment to the effect that what were ordered reconveyed were the converted 753,848,31 SMC Series I Preferred Shares to be used only for the benefit of all coconut farmers and for the development of the coconut industry

From the issuance of the above-mentioned 4 September 2012 Resolution, RP filed Manifestation and Omnibus Motion: 1) To Amend the Resolution Promulgated on September 4, 2012 to Include the “Treasury Shares[1]” Which are Part and Parcel of the 33,133,266 Coconut Industry Investment Fund (CIIF) Block of San Miguel Corporation (SMC) Shares as of 1983 Decreed by the Sandiganbayan and Sustained by the Honorable Court, As Owned by the Government, 2) To Direct San Miguel Corporation (SMC) to Comply with the Final and Executory Resolutions Dated October 24, 1991 and March 18, 1992 of the Sandiganbayan Which Were Affirmed by the Honorable Court in G.R. Nos.104637-38 dated 12 October 2012.

Also, COCOFED filed a Manifestation dated 4 October 2012 praying among others to direct SMC to deposit the proceeds of the redemption of the 753,848,312 SMC Series 1 Preferred Shares of the CIIF Companies and all accrued and unpaid dividends thereon into the DBP or Landbank, and enjoin SMC from depositing and/or remitting the proceeds of said redemption in UCPB. SMC and RP filed their respective comment. COCOFED filed a Consolidated Reply with Motion for Production of Escrow Agreements dated 29 September 2014.

On 14 October 2014, PCGG/OSG filed a Motion for Partial Entry of Judgment with respect to the 753,848,312 SMC Series I Preferred Shares. A Supplemental Motion was thereafter filed to include the Farmers’ UCPB shares, the CIIF companies and the 14 Holding Companies. A partial Entry of Judgment (see Civil Case No. 0033-A) was issued by the Supreme Court. On 10 December 2014.

On 5 October 2016, the Supreme Court in said GR Nos. 177857-58 and 178193 denied RP’s Manifestation and Omnibus Motion: 1) To Amend the Resolution Promulgated on September 4, 2012 to Include the “Treasury Shares” Which are Part and Parcel of the -33,133,266 Coconut Industry Investment Fund (CIIF) Block of San Miguel Corporation (SMC) Shares as of 1983 Decreed by the Sandiganbayan and Sustained by the Honorable Court, As Owned by the Government, 2) To Direct San Miguel Corporation (SMC) to Comply with the Final and Executory Resolutions Dated October 24, 1991 and March 18, 1992 of the Sandiganbayan Which Were Affirmed by the Honorable Court in G.R. Nos. 104637-38 dated 12 October 2012, the dispositive portion of which states as follows:

“WHEREFORE, the Republic of the Philippines’ Manifestation and Omnibus motion dated October 12, 2012 is DENIED without prejudice to the right of respondent Republic to institute the appropriate action or proceeding where SMC’s alleged right over the 25.45 million SMC treasury shares will be determined and finally resolved.”

According to the Supreme Court, there was no mistake in the dispositive portion of the September 4, 2012 Resolution as the fallo was clarified precisely to reflect the number of shares with the PCGG, and the 25.45 million shares with SMC were no longer included therein:

– the court has not acquired jurisdiction over SMC since it is not a party to Civil case No. 0033-F, hence, the former has no power to order SMC to comply with any pronouncement made in the case involving, adversely at that, its property; thus fair play dictates that parties are allowed to present their respective claims in a full blown trial regarding the “sale” of the 25.45 million SMC shares for P500 million;

-the SMC treasury shares and the PCGG arbitration shares were already registered under their own names by virtue of the Compromise Agreement between SMC and CIIF companies which the PCGG approved.

-the retention and acquisition of the P500 million (amount paid by SMC for the shares) is a flagrant and arbitrary deprivation of SMC’s property which is a violation of its due process right as PCGG has not intimated to return the same to SMC while RP ask for the delivery and reconveyance of the P25.45 million shares;

PCGG filed a Motion for Reconsideration dated 8 November 2016. The SC in a Resolution dated 29 November 2016 denied with finality the motion for Reconsideration.

In the court quo, a Motion for Partial Execution dated 4 April 2016 was filed by RP on the Partial Summary Judgment dated 7 May, 2004. A Manifestation in Lieu of Comment dated 30 May 2016 was filed by defendant Eduardo Cojuangco, Jr.

In light of the 5 October 2012 Decision of the Supreme Court, UCPB filed a Manifestation dated 23 February 2017 in support of its Comment/Opposition (With Motion for Opportunity to be Heard) dated 31 August 2016 and its Rejoinder (to Plaintiff’s Reply dated 7 September 2016) dated 3 October 2016 both filed in respect to the Motion for Partial Execution dated 4 April 2016 by the Republic.

UCPCB calls the attention of the SC to the Resolution dated 5 October 2016 of the Supreme Court in the case of Philippine Producers Federation, Inc. (COCOFED), et. al. vs. RP holding that the Supreme Court’s Decision dated 24 January 2012 is not binding on San Miguel Corporation because SMC is not impleaded as a defendant in Civil Case No. 0033-F. UCPB posits that like SMC, it was not impleaded as a party defendant in Civil Case 0033-F hence, its Motion for Opportunity to be Heard dated 31 August 2016 praying that it be afforded a full blown trial to prove its claim over the “UCPB Direct CIIF Interest” and 11% Indirect Interest be granted.

In connection with the Motion for Leave of Court to File Comment/Opposition and to Admit Attached Comment/Opposition Ad Cautelam filed by United Coconut Planters Life Assurance Corporation, the Republic is given 15 days from 21 April 2017 to file its Comment. The movant is given 15 days from receipt within which to file Reply. Movant filed its Reply dated 2 June 2017.

Defendants 14 CIIF Holding Companies filed a Comment/Opposition (To Motion for Partial Execution) dated 3 May 2017. OSG filed its Comment dated 2 May 2017.

The Court set the case for Hearing on 29 January 2018 at 130 pm to enable the parties, including UCPB and COCOLIFE to define and clarify their respective legal dispositions on the applicability and/or relevance of the COCOFED Decision in resolving the Motion for Partial Execution.

Defendant Eduardo M. Cojuangco Jr filed a Manifestation dated dated Jan. 29, 2018 (Re: Plaintiff’s Motion for Partial Execution” dated April 4, 2016)

Cocolife filed a Comment/Opposition (to Plaintiff’s Motion for Reconsideration dated 18 January 2018) dated 7 February 2018.

The Republic filed a Consolidated Reply dated February 26, 2018.

Plaintiff RP represented by PCGG through the OSG filed a Consolidated Reply dated February 26, 2018, which prays that (1) the Resolution dated December 29, 2017 be recalled and anew one be issued granting the Motion for Execution; and (2) UCPB, COCOLIFE and their counsels be cited in direct contempt of court for deliberately resorting to forum shopping and abusing the court’s processes.

RP represented by PCGG through OSG filed a Manifestation dated March 7, 2018, stating that it is adopting its Consolidated Reply as its Reply to the Comment/Opposition filed defendants CIIF Oil Mills and the 14 CIIF Holding Companies.

Sycip Salazar Hernandez & Gatmaitan filed a Manifestation dated April 17, 2018, stating: (1) It was engaged as counsel by SMC when SMC filed a Motion to Intervene in this case dated February 2, 2004, praying that this Court allow SMC to intervene an admit SMC’s Complaint-in Intervention; (2) On May 6, 2004, this Court denied SMC’s Motion to Intervene for lack of merit SMC then filed a Motion for Reconsideration on May 20, 2004; (3) SMC’s Motion for Reconsideration was effectively denied by this Court in a Resolution promulgated on November 27, 2007; (4) As SMC’s Motion for Reconsideration was denied, the law firm has ceased to have any part in these proceedings. However, it continues to be unnecessarily served with papers and processes in connection with this case. In this light, the law firm respectfully requests that the Court directs its staff to discontinue serving notices and orders on the undersigned counsel.

In a Resolution promulgated on 7 August 2018, the Court GRANTED the Motion For Reconsideration filed by the plaintiff RP on 23 January 2018. Writ of Partial Execution was ordered to be issued to implement the Supreme Court Decision in GR Nos. 177857-58 and 178193, which affirmed the Partial Summary Judgment of the Court dated May 7, 2004, finding that the CIIF Companies, the 14 Holdings Companies, and the CIIF Block of SMC shares are owned by plaintiff RP. In accordance with Section 4 of Executive Order No. 180, s. 2015, the PCGG, the BTr, the Governance Commission for GOCC, the OSG, the government representatives to the board of sequestered or surrendered corporations, and any government agency having any coconut levy asset in their administration, authority, custody or control, are hereby directed to immediately and without further delay cede, transfer, convey and/or reconvey title to the plaintiff RP of the shares of stock in the 6 CIIF Companies and the 14 CIIF Holding Companies, as well as deposit money and funds constituting the coconut levy or accruing from the coconut levy assets in the Special Account in the General Fund for Coco Levies with the Bureau of Treasury with respect to the 753,848,312 Converted SMC Series Preferred Shares, including all dividends, declared, paid or issued after September 17, 2009, proceeds from the redemption on October 05, 2012, and all income, interest, or profits derived from these assets, to be used only for the benefit of all coconut farmers and for the development of coconut industry.

COCOLIFE filed an Omnibus Motion

For Case Conference; and
To Suspend Proceedings (only in Respect of Movant Cocolife)
dated Sept. 25, 2018.

In an Order dated October 5, 2018, the Omnibus Motion was denied by the Court considering that there is no proof of service to the plaintiff RP of the Omnibus Motion (1) for case conference and (2) to suspend Proceedings (Only in Respect of Movant Cocolife) filed by COCOLIFE. COCOLIFE filed its MR thereto.

In an ORDER dated October 19, 2018, the Court stated that the Motion for Reconsideration filed by Cocolife and with the manifestation that the prosecution is adopting its comment and/or opposition to the MR filed by UCPB, the MR of Cocolife is now submitted for resolution. Undeterred, Cocolife filed a Motion for Leave to Admit Attached Reply (Re: Opposition dated 9 October 2018) dated Nov. 5, 2018.

In a Resolution promulgated on Dec. 3, 2018, the Court held that the Motion for Reconsideration (Re: Resolution dated 7 August 2018) and the Motion for Reconsideration (Re Denial of the Omnibus Motion dated September 25, 2018 filed by COCOLIFE, the Motion for Recon (of Resolution dated 7 August 2018) filed by the CIIF Oil Mills Group and the 14 Holding Companies are DENIED for lack of merit.

On January 4, 2019, United Coconut Planters Bank (UCPB) filed a Petition for Certiorari under Rule 65 of the Rules of Court seeking to nullify or set aside the Resolution dated August 7, 2018 of the Sandiganbayan as well as the Resoluiton dated December 3, 2018 denying Petitioner’s Motion for Reconsideration. UCPB seeks the proper and lawful execution of the Partial Summary Judgement rendered by Sandiganbayan on May 7, 2004 in Republic v. Eduardo Cojuangco et al. in Civil Case No. 0033-F, as affirmed by this Court in Phil. Coconut Producers Federation Inc (COCOFED) et al vs. RP et al.

On 11 January 2019, The CIIF Oil Mills Group and the 14 CIIF Holding Companies filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court to annul and set aside the Resolution dated August 7, 2018 of the Sandiganbayan as well as the Resoluiton dated December 3, 2018 denying Petitioner’s Motion for Reconsideration.

On February 8, 2019, Sandiganbayan Second Division issued a Writ of Execution of the September 4, 2012 Decision of the Supreme Court and the August 7, 2018 Decision of the Sandiganbayan relative to Civil Case No. 0033-F.

On February 15, 2019, United Coconut Planters Life Assurance Corporation (COCOLIFE) filed with the Supreme Court a Petition for Certiorari with Application for Issuance of a Temporary Restraining Order and/or a Writ of Preliminary Injunction assailing the Sandiganbayan Resolutions dated August 7, 2018 and December 3, 2018, docketed as G.R. No. 244346.

On March 7, 2019, in G.R. No. 244346, Petitioner COCOLIFE filed a Motion for Consolidation praying that its case be consolidated with the UCPB case and for the same be jointly heard/resolved.

Notice of Death of respondent Danilo S. Ursua who died on August 10, 2018 in Makati City was filed by his counsel on May 10, 2019.

Status: Final in Favor of Government
Date Entered Status : 01/24/12
Relevant Case/s: GR. Nos. 177857-58, 178193
Actual recoveries: P 76.5Billion

Remarks: Recovered Farmers’ SMC shares and 6 CIIF Companies and 14 Holding Companies on January 24, 2012 as modified on 4 September 2012 Decisions of the Supreme Court in aforementioned cases. Although a Partial Entry of Judgment has been issued, pending incidents are still pending with the Supreme Court one of which is RP’s Manifestation and Omnibus Motion:

1) To Amend the Resolution Promulgated on September 4, 2012 to Include the “Treasury Shares” Which are Part and Parcel of the 33,133,266 Coconut Industry Investment Fund (CIIF) Block of San Miguel Corporation (SMC) Shares as of 1983 Decreed by the Sandiganbayan and Sustained by the Honorable Court, As Owned by the Government,

2) To Direct San Miguel Corporation (SMC) to Comply with the Final and Executory Resolutions Dated October 24, 1991 and March 18, 1992 of the Sandiganbayan Which Were Affirmed by the Honorable Court in G.R. Nos. 104637-38 dated 12 October 2012.

Status: Final in Favor of Government
Date Entered Status : 01/24/12
Relevant Case/s: GR. Nos. 177857-58, 178193
Actual recoveries: P 76.5Billion

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