Chavez vs.

PCGG
GR No. 1307716

Parties:

Petitioner:

Francisco Chavez-Former Solicitor General; A Filipino Citizen; who initiated the prosecution of the
Marcoses and their cronies

Respondents:

a. Presidential Commission on Good Government (PCGG)- the government prosecutor of ill-gotten

wealth cases.
b. Magtanggol Gunigundo (in his capacity as Chairman of PCGG)

Petitioners-in-Intervention

a. Gloria A. Jopson
b. Celnan A. Jopson
c. Scarlet A. Jopson
d. Teresita A. Jopson
Herein Petitioners-in-Intervention filed a Motion for Intervention averring that
they are among the 10,000 claimants whose right to claim from the Marcos
Family and/or the Marcos Estate is recognized by the decision in In re: Estate
of Ferdinand Marcos and the decision of the Swiss Supreme Court. Thus they
claim to have personal and direct interest in the subject matter

What the petitioner sought here is the enforcement of their right to be informed on matters of public
concern.

Further, petitioner wanted for the court to define the nature and extent of constitutional right to
information on matters of public concern. Does this right include the access to the terms of
government negotiations even such negotiation is not yet consummated? May the government,
through PCGG, be required to reveal the proposed terms of compromise agreement with the Marcos
heir as regards to their alleged ill-gotten wealth? Or will such Compromise Agreement (General
Agreement and Special Agreement) be considered valid and binding?

The instant petition is anchored on the right of the people to information and access to official
records, documents and papers.

FACTS:

Impelled by several news reports (eg. the alleged discovery of billions of dollars of Marcos assets
deposited in various coded accounts in Swiss Banks; reported execution of a compromise,
 between the government (through PCGG) and the Marcos heirs, on how to split or share these
assets), Petitioner Chaves, taxpayer, Filipino Citizen and Former Government official , bring an
action against PCGG in court.

Petitioner Chaves is invoking the following:

a. his right to information and the correlative duty of the state to disclose publicly all its
transactions involving the national interest. He demanded that PCGG should make public any
and all negotiations and agreements pertaining to PCGGs task of recovering Marcos ill-gotten
wealth.
b. any compromise on the alleged billions of ill-gotten wealth involves an issue of paramount
public interest since it has debilitating effect in the countrys economy. He also invoked that
any compromise agreement in relation to ill-gotten wealth which belongs to the People and in
truth and in fact, part of the public funds, can be enjoined by a taxpayer whose interest is for
a full, if not substantial recovery of such assets. He emphasized that recovering this ill-gotten
wealth is an issue of transcendental importance to the public.
c. The Court has jurisdiction over this case pursuant to Section 5 Art. VIII of the Constitution,
which confers upon the SC original jurisdiction over petitions for prohibition and mandamus.
d. Any compromise agreement between the government and the Marcoses wil be a virtual
condonation of all the alleged wrongs done by them, as well as an unwarranted permission to
commit graft and corruption.

PCGGs contention:

a. Petitioner has no legal standing to institute the present action, because no expenditure of
public funds is involved and said petitioner has no actual interest in the alleged agreement.
b. With regard to compromise agreement, the PCGG claim the Petitioner Chavezs action is
premature, because there is no showing that he has asked the PCGG to disclose the
negotiations and the agreement. And even if he has, PCGG may not yet be compelled to make
any disclosure, since the proposed terms and conditions of the Agreements have not become
effective and binding.
c. Court has no jurisdiction since there is neither justiciable controversy nor a violation of
petitioners rights by the PCGG. The assailed agreements are already the very lis mota in
Sandiganbayan, which has yet to dispose the issue; thus this is premature.
d. There is no legal restraint on entering into a compromise agreement with Marcos heirs,
provided that agreement does not violate any law.

By the Whereas Clauses and Terms of the subject Compromise Agreement (General Agreement and
Special Agreement), it was provided that:

a. There is a judgment from Swiss Federal Tribunal (1990) that the amount of $356 million of
Swiss Account of Marcos belongs to the Republic of the Philippines provided certain conditions
are met. However, even after 7 yrs, the Republic of the Phils. was not able to procure a final
judgement of conviction against Marcoses.
 b. The parties will collate all assets presumed to be owned by Marcoses and based on the
inventory, the Republic will determine the totality of the assets belong to the Republic and the
portion retained to the Marcoses, the portion to be retained by Marcoses shall be exempt from
Tax.
c. Foreign assets which the Marcoses shall fully disclose but which are held by trustees, etc. are
waived in favor of the Republic.
d. All disclosures of assets made by Marcoses shall not be used as evidence by Republic in any
criminal, civil or admin case.
e. Any property which may be discovered in the future as belonging to Marcoses and not
included in inventory as mentioned here shall automatically belong to the Republic.
f. All incidental expenses related to recovery is to be borne by Marcoses.
g. Marcoses shall be entitled to 25% of the amount that may be eventually withdrawn from said
$356 million Swiss Deposit and 75% thereof will go to the Republic.
h. Information to be disclosed by Marcoses related to this ill-gotten wealth shall not be used
against them in any criminal, civil or administrative case.
i. In case of violations by Marcoses of the agreement, the parties shall be restored automatically
to the status quo ante the signing of agreement.

Said agreements have not yet been approved by the President.

ISSUE:

(a) Procedural:
(1) Whether or not the petitioner has the personality or legal standing to file the instant
petition; and
(2) Whether or not this Court is the proper court before which this action may be filed.
(b) Substantive:
(1) Whether or not this Court could require the PCGG to disclose to the public the details
of any agreement, perfected or not, with the Marcoses; and
(2) Whether or not there exist any legal restraints against a compromise agreement
between the Marcoses and the PCGG relative to the Marcoses ill-gotten wealth.i

RULING:

On petitioners Standing:

Access to public documents and records is a public right, and the real parties in interest are the
people themselves. Thus, petitioner has legal standing to institute the instant petition.

When the issue concerns a public right and the object of mandamus is to obtain the enforcement of
public duty, the people are regarded as the real parties in interest. It is sufficient that the petitioner is
a citizen and as such is interested in the execution of the laws. He need not show that he has any
legal or special interest in the result of the action.
A right to be informed of matters of public concern is a right recognized in Sec. 6, Art. IV of the 1973
Constitution, in connection with the rule that laws in order to be valid and enforceable must be
published in the Official Gazette or otherwise effectively promulgated.

Right of People to Information and access to official records, documents and papers- a right
guaranteed under Section 7, Article III of the 1987 Constitution.

The court declared that the right sought by the petitioner to enforced is a public right recognized by
no less than the fundamental law of the land.

The petitioner has legal Standing Here.

To sustain petitioners legal standing, there are two basic requisites laid down by decisional law:

a. Enforcement of a public right

b. Espoused by a Filipino Citizen

Since herein petitioner is a Filipino citizen and what he sought is an enforcement of public right, he
has legal standing and the petition at bar should be allowed to institute the same.

Recovery of Marcoses alleged ill-gotten wealth is a matter of public concern and imbued with public
interest. It may also add that ill-gotten wealth, by its very nature, assumes a public character.

With regard to the locus standi of Petitioner- Intervenor (the Jopsons), they are among legitimate
claimants to the Marcos Wealth, and their standing was not questioned by Solicitor General. Indeed,
said intervenors have legal interest, in fact their presence alone rendered moot the questioned as to
standing of Petitioner Chavez.

On the Courts Jurisdiction:

The court upheld therein petitioners resort to a mandamus proceeding, seeking to enforce a public
right as well as to compel performance of a public duty mandated by no less than fundamental law.

Petitioner here is seeking the public disclosure of ALL negotiations and agreements, be they ongoing
or perfected (not only the Compromise Agreement between PCGG and Marcoses), thus the
contention of Respondent PCGG that the relief sought by Petitioner must be brought before
Sandiganbayan where the issue on Compromise Agreement is pending resolution and not to the SC
has no merit.

On the Substantive Issue: Public Disclosure of Terms of Any Agreement, Perfected or not:

Sec. 7 [Article III]. The right of the people to information on matters of public
concern shall be recognized. Access to official records, and to documents, and papers
pertaining to official acts, transactions, or decisions, as well as to government research data
used as basis for policy development, shall be afforded the citizen, subject to such limitations
as may be provided by law.
Sec. 28 [Article II]. Subject to reasonable conditions prescribed by law, the State
 adopts and implements a policy of full public disclosure of all its transactions involving
public interest.
The information and the transactions referred to in the subject provisions of the Constitution
have as yet no defined scope and extent. There are no specific laws prescribing the exact limitations
within which the right may be exercised or the correlative state duty may be obliged. However, the
following are some of the recognized restrictions: (1) national security matters and intelligence
information, (2) trade secrets and banking transactions, (3) criminal matters (eg. law enforcement
matters relating to apprehension, prosecution and detention of criminals), and (4) other confidential
information (eg. information by reason of office and not made available to the public; diplomatic
correspondence, closed door cabinet meetings, internal deliberation of SC, executive sessions of
Congress, etc.).
Public Concern- Public concern like public interest is a term that eludes exact
definition. Both terms embrace a broad spectrum of subjects which the public may want to
know, either because these directly affect their lives, or simply because such matters
naturally arouse the interest of an ordinary citizen. In the final analysis, it is for the courts to
determine on a case by case basis whether the matter at issue is of interest or importance,
as it relates to or affects the public.
In general, writings coming into the hands of public officers in connection with their official functions
must be accessible to the public, consistent with the policy of transparency of governmental affairs.
This principle is aimed at affording the people an opportunity to determine whether those to whom
they have entrusted the affairs of the government are honestly, faithfully and competently
performing their functions as public servants.

In the conversation between Mr. Suarez and Mr. Ople (Constitutional Commissioners), Mr. Ople made
it clear that the transactions referred to by the Constitution pertains not only to consummated
contract but also those negotiations leading to consummation of the contract.

Considering the intent of the framers of the Constitution, the Court believe that it is incumbent upon
the PCGG and its officers, as well as other government representatives, to disclose sufficient public
information on any proposed settlement they have decided to take up with the ostensible owners and
holders of ill-gotten wealth. Theres a need, of course, to observe the same restrictions on disclosure
of information in general in a matters involving national security, diplomatic or foreign relations,
intelligence and other classified information.

Due to various Executive orders issued by then President Corazon Aquino in relation to the recovery
of ill-gotten wealth by Marcoses and the creation of PCGG, among others, it is undeniable that the
recovery of the Marcoses alleged ill-gotten wealth is a matter of public concern and imbued with
public interest.

On the second Substantive Issue: Legal Restraints on a Marcos-PCGG Compromise

In general, law encourages compromises in civil cases except with regard to the following matters:
(a) civil status of a person (b) validity of marriage or legal separation (3) any ground for legal
separation (4) future support (5) jurisdiction of courts (6) future legitime. Like any other contract, the
terms and conditions of compromise must not be contrary to law, morals, good customs, public policy
or public order. A compromise is binding and has the force of law between the parties, unless the
consent of a party is vitiated-by mistake, fraud, violence, intimidation or undue influence- or when
there is forgery, or if the terms of the settlement are so palpable conscionable. In the latter
instances, the agreement may be invalidated by the courts. The court held that in the absence of
express prohibition, the rule on compromises in civil action under the Civil Code is applicable to PCGG
cases. Such principle is pursuant to the objectives of EO No. 14, particularly the just and expeditious
recovery of ill-gotten wealth, so that it may be used to hasten economic recovery.

But it must be noted that compromise in civil liability does not automatically terminate criminal
proceeding or extinguish criminal liability. The power to grant criminal immunity in this case was
conferred on PCGG by EO No. 14, Sec. 5., as amended by EO No. 14-A. The conditions under which
the PCGG may exercise authority to grant criminal immunity are as follows:

a. Person to whom criminal immunity is granted provides information or testifies in an

investigation conducted by the Commission.
b. The information or testimony pertains to the unlawful manner in which the respondent,
defendant or accused acquired or accumulated ill-gotten property;
c. Such information or testimony is necessary to ascertain or prove guilt or civil liability of such
individual.

But the said Compromise Agreement is held by Court as invalid and Unconstitutional because of
serious legal flaws as follows:

a. It does not conform to Executive Order No. 14 and 14-A. Criminal Immunity cannot be granted
to the Marcoses, who are principal defendants in the spate of ill-gotten wealth cases now
pending before Sandiganbayan. The provision applicable mainly to witnesses.
b. The provision in General Agreement that the portion to be retained by Marcoses shall be
exempted from Tax is violative of the Constitution, because the power to tax or to give tax
exemption is vested in Congress. Even if Congress pass a law granting a tax exemption to
Marcoses, it will not pass the test of equal protection clause, it will violate the constitutional
rule that taxation shall be uniform and equitable.
c. Such agreement will bind the government to dismiss all cases against the Marcos heirs
pending before the Sandiganbayan and other courts. This is a direct encroachment of Judicial
power. Thus, PCGG cannot guarantee the dismissal of all such criminal cases against the
Marcoses pending in the courts, for said dismissal is not within its sole power and discretion.
d. The provision that government also waives all claims and counterclaims wether past, present,
or future, matured or inchoate against the Marcoses is contrary to law. Civil Code provides
that An action for future fraud may not be waived. It will give a license to Marcoses to
perpetrate fraud against the government without liability at all. This is a palpable violation of
the due process and equal protection guarantees of the Constitution. Allowing it will also set a
dangerous precedent for public accountability that it warrant public officials to amass public
funds illegally, since there is open option to compromise their liability in exchange for only a
portion of their ill-gotten wealth.
e. Agreements do not state with specificity the standards for determining which assets shall be
forfeited by the government and which shall be retained by the Marcoses. Also the basis of 25-
75 percent sharing ratio of Swiss deposit has no basis stated in the agreement.
f. The absence of President Ramos approval of the Agreements rendered it complete and
unenforceable. But even if such approval is obtained, the Agreements would still not be valid
as the same is grossly disadvantageous to the Government.