G.R. No. 152500; September 14, 2011
PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT, Petitioner, vs. SANDIGANBAYAN (Second Division), TOURIST DUTY FREE SHOPS, INC., BANK OF AMERICA and RIZAL COMMERCIAL BANKING CORPORATION, Respondents.

FACTS

On March 11, 1986, the Presidential Commission on Good Government (PCGG) issued a Sequestration Order against Tourist Duty Free Shops, Inc. (TDFSI), signed by then Commissioner Mary Concepcion Bautista, and a Freeze Order directed at Rizal Commercial Banking Corporation (RCBC) regarding TDFSI’s funds. TDFSI filed a petition (G.R. No. 74302) to annul the Sequestration Order. On May 27, 1986, the Supreme Court issued a Resolution allowing the sequestration to stand but permitting TDFSI to operate under PCGG supervision. This petition was later dismissed without prejudice on October 8, 1991, upon the issuance of Executive Order No. 14, directing such claims to be filed with the Sandiganbayan.
Meanwhile, on July 21, 1987, the Republic, represented by PCGG, filed a complaint for reconveyance, etc., against the Tantocos, Ferdinand Marcos, Imelda Marcos, and others (Civil Case No. 0008). Following the dismissal of G.R. No. 74302, TDFSI filed a Complaint for Injunction and Specific Performance against PCGG, Bank of America, and RCBC before the Sandiganbayan (Civil Case No. 0142) on December 18, 1991. TDFSI assailed the Sequestration Order as invalid for being signed by only one Commissioner and issued without investigation, and claimed it was automatically lifted since no recovery action was filed. It also sought to prevent the banks from requiring PCGG approval for withdrawals.
The Sandiganbayan initially dismissed Civil Case No. 0142 without prejudice on June 15, 1992, finding its issues related to Civil Case No. 0008. The Supreme Court reversed this dismissal in G.R. No. 107395 on January 26, 2000, holding no litis pendentia, and remanded the case. On July 26, 2001, the Sandiganbayan granted TDFSI’s motion for a writ of preliminary mandatory and prohibitory injunction, enjoining PCGG from implementing the sequestration and the banks from requiring PCGG approval for TDFSI’s transactions, upon posting a bond. PCGG’s motions for reconsideration were denied. PCGG then filed the present Petition for Certiorari and Prohibition, assailing the Sandiganbayan’s orders.

ISSUE

Whether the Sandiganbayan committed grave abuse of discretion amounting to lack or excess of jurisdiction in issuing the writ of preliminary mandatory and prohibitory injunction against the implementation of the Sequestration Order.

RULING

The Supreme Court granted the petition, finding that the Sandiganbayan committed grave abuse of discretion. The Court ruled that the requisites for the issuance of a preliminary injunction were not present. TDFSI failed to establish a clear and unmistakable right to the relief sought. The Sequestration Order, issued under the PCGG’s mandate to recover ill-gotten wealth, enjoyed a presumption of regularity. The Court cited Bataan Shipyard & Engineering Co., Inc. (BASECO) v. PCGG, which held that a writ of sequestration is a provisional remedy, and its issuance by the PCGG is justified by the nature of its task. The fact that the Order was signed by only one Commissioner did not automatically render it void, as the governing rules at the time (Executive Order No. 1) did not specify the number of Commissioners required to issue such an order; this requirement was introduced later by Executive Order No. 14. Furthermore, the lifting of a sequestration order is not automatic but requires a judicial determination. The Sandiganbayan’s order effectively lifted the sequestration without a full trial on the merits, which was premature. The injunction also disrupted the status quo that had been maintained since the Supreme Court’s 1986 Resolution in G.R. No. 74302, which allowed the sequestration to stand under certain conditions. Therefore, the assailed Sandiganbayan Resolutions and Orders were annulled and set aside.