GR 125296; (July, 2006) (Digest)
G.R. No. 125296 ; July 20, 2006
ISMAEL G. KHAN, JR. and WENCESLAO L. MALABANAN, petitioners, vs. OFFICE OF THE OMBUDSMAN, DEPUTY OMBUDSMAN (VISAYAS), ROSAURO F. TORRALBA and CELESTINO BANDALA, respondents.
FACTS
Private respondents charged petitioners, former officers of Philippine Airlines (PAL), before the Deputy Ombudsman for violating the Anti-Graft and Corrupt Practices Act (RA 3019). The complaint alleged petitioners used their positions to secure a contract for a corporation in which they were shareholders. Petitioners moved to dismiss, arguing the Ombudsman lacked jurisdiction as PAL was a private entity and they were not public officers. The Deputy Ombudsman denied the motion, ruling that PAL became a government-owned or controlled corporation (GOCC) when the Government Service Insurance System acquired its controlling stock, and that petitioners were public officers under RA 3019. The Ombudsman affirmed this ruling on appeal.
ISSUE
Whether the Office of the Ombudsman has jurisdiction to investigate petitioners, officers of Philippine Airlines, for alleged violations of RA 3019.
RULING
The Supreme Court granted the petition, ruling that the Ombudsman has no jurisdiction. The legal logic is anchored on a strict constitutional interpretation. Article XI, Section 13(2) of the 1987 Constitution explicitly limits the Ombudsman’s jurisdiction over GOCCs to only those “with original charter,” meaning corporations created by special law. PAL was organized under the general corporation law as a private entity. The subsequent government acquisition of its controlling interest did not transform it into a GOCC with an original charter. Therefore, its officers do not fall under the Ombudsman’s constitutional ambit. The Court distinguished the cited precedent, Quimpo v. Tanodbayan, noting it involved a corporation (PETROPHIL) acquired by the government to perform specific governmental functions related to national policy, a circumstance not present with PAL’s commercial airline operations. Consequently, petitioners, not being public officers of a GOCC with an original charter, are beyond the reach of the Ombudsman’s investigatory and prosecutory powers under RA 3019. The assailed orders were issued with grave abuse of discretion.