G.R. Nos. 217592-93, July 13, 2020
Benito T. Keh and Gaudencio S. Quiballo, Petitioners, vs. People of the Philippines, Respondent.

FACTS

Petitioners Benito T. Keh and Gaudencio S. Quiballo, the chairman/president and corporate secretary of Ferrotech Steel Corporation, were charged before the Office of the City Prosecutor (OCP) of Valenzuela City with violation of Section 74, in relation to Section 144, of the Corporation Code. The charge stemmed from their alleged unjustified refusal to allow stockholder Ireneo C. Quizon to inspect the corporate books and records. The OCP found probable cause and filed an Information before the Regional Trial Court (RTC) of Valenzuela City. Petitioners filed motions for reconsideration with the OCP and, before the trial court, a motion for deferment of arraignment, suspension of proceedings, and quashal of the information, also requesting the court to make its own determination of probable cause. The trial court denied this motion. Petitioners then filed Omnibus Motions for inhibition and reconsideration, arguing the information lacked essential elements. The presiding judge recused himself, and the case was raffled to Branch 269, which denied the reconsideration. Petitioners filed a Petition for Certiorari and Mandamus before the Court of Appeals (CA-G.R. SP No. 116798). In the interim, petitioners were arraigned and trial commenced. After the prosecution presented its evidence, petitioners filed Omnibus Motions Ex Abundante Ad Cautelam and Demurrer to Evidence, reiterating their grounds for quashal. The trial court, in an August 25, 2011 Order, granted the motion to quash, finding the Information defective for lacking allegations of the first and fourth elements of the offense, and dismissed the criminal case without prejudice. Petitioners appealed to the Court of Appeals (CA-G.R. CR No. 34411), seeking dismissal with prejudice on double jeopardy grounds. The Court of Appeals, in a consolidated Decision, denied the appeal and dismissed the certiorari petition, upholding the dismissal without prejudice. Petitioners elevated the case to the Supreme Court via a petition for review on certiorari, seeking the penultimate dismissal of the case with prejudice.

ISSUE

Whether the Court of Appeals erred in upholding the trial court’s quashal of the Information and the consequent dismissal of the criminal case without prejudice, specifically in relation to the sufficiency of the allegations in the Information charging a violation of Section 74, in relation to Section 144, of the Corporation Code.

RULING

The Supreme Court denied the petition. It held that the allegations in the Information were sufficient to charge the offense. The Information alleged that petitioners, as corporate officers, “willfully, unlawfully and feloniously refuse, without showing any justifiable cause[,] to open to inspection to IRENEO C. QUIZON, a stockholder of said corporation[,] the [corporate] books and records.” The Court ruled that the phrase “refuse, without showing any justifiable cause” reasonably implies that a prior written demand was made, satisfying the first element. Regarding the fourth element (which pertains to the defense that the stockholder acted in bad faith or for an improper purpose), the Court ruled it is a matter of defense properly addressed during trial and need not be alleged in the Information. The Court found that the Information adequately informed petitioners of the charge against them, enabling them to prepare their defense. Consequently, the Supreme Court declared the trial court’s quashal of the Information and dismissal without prejudice to be out of order. The case was ordered remanded to the trial court for further proceedings.