G.R. No. 169677 ; February 18, 2013
METROPOLITAN BANK AND TRUST COMPANY, as successor-in-interest of ASIAN BANK CORPORATION, Petitioner, vs. HON. EDILBERTO G. SANDOVAL, HON. FRANCISCO H. VILLARUZ, JR. and HON. RODOLFO A. PONFERRADA (in their capacities as Chairman and Members, respectively, of the Second Division of SANDIGANBAYAN) and the REPUBLIC OF THE PHILIPPINES, Respondents.

FACTS

The Republic filed a complaint with the Sandiganbayan to recover alleged ill-gotten wealth, including two parcels of land registered under spouses Andres and Ludivina Genito. Years later, the Republic amended its complaint to implead Asian Bank (whose interest was later succeeded by Metrobank) as an additional defendant. Asian Bank held titles to the same properties and was in possession under a writ from the RTC. When the Republic was about to conclude its evidence presentation against the original defendants, it moved for a separate trial against Asian Bank.
Asian Bank opposed, arguing it would be deprived of its day in court if not allowed to confront and assail the evidence already presented against the original defendants. It contended that the issue of its good faith in acquiring the properties was intimately linked to the main issue of whether the properties were ill-gotten. The Sandiganbayan granted the Republic’s motion, reasoning that the claim against the bank was distinct, being anchored on whether it had knowledge the properties were subject to litigation, not on whether they were ill-gotten.

ISSUE

Whether the Sandiganbayan committed grave abuse of discretion in granting a separate trial against Asian Bank.

RULING

No, the Sandiganbayan did not commit grave abuse of discretion. The Supreme Court held that the grant of a separate trial is discretionary with the trial court under Section 2, Rule 31 of the Rules of Court, to serve convenience, avoid prejudice, or expedite proceedings. The core legal logic is that a separate trial is proper when the causes of action against different defendants are separate and distinct. Here, the Republic’s cause against the original defendants was for accumulation of ill-gotten wealth, while its cause against Asian Bank was an action for reconveyance based on the bank’s alleged bad faith in registering the properties despite knowledge of the pending litigation. These are independent claims.
The Court found no deprivation of Asian Bank’s right to be heard. A separate trial does not preclude the bank from presenting its own evidence and challenging the Republic’s proofs specifically directed against it. The bank’s fear of being bound by evidence it could not confront was unfounded, as the Sandiganbayan’s resolution did not preclude it from requiring the Republic to present its evidence anew or from adopting the existing evidence, subject to the bank’s right to cross-examine. The Sandiganbayan acted within its sound discretion to order a separate trial for expeditious resolution, and its order did not violate Asian Bank’s substantive rights. The petition for certiorari was dismissed.