G.R. No. 134990 ; April 27, 2000
MANUEL M. LEYSON JR., petitioner, vs. OFFICE OF THE OMBUDSMAN, TIRSO ANTIPORDA, Chairman, UCPB and CIIF Oil Mills, and OSCAR A. TORRALBA, President, CIIF Oil Mills, respondents.

FACTS

Petitioner Manuel M. Leyson Jr., Executive Vice President of International Towage and Transport Corporation (ITTC), filed a complaint with the Office of the Ombudsman against respondents Tirso Antiporda and Oscar A. Torralba, officers of CIIF companies (Legaspi Oil, Granexport, and United Coconut). The complaint alleged violations of the Anti-Graft and Corrupt Practices Act, stemming from the unilateral termination of ITTC’s shipping contract and the subsequent engagement of another vessel under terms allegedly grossly disadvantageous to the government. The Ombudsman dismissed the complaint, ruling it involved a simple breach of contract between private entities, over which it had no jurisdiction, and noted petitioner had concurrently filed a civil collection case.
Petitioner sought reconsideration, arguing the CIIF companies, funded by coconut levy funds declared as public funds in prior jurisprudence, should be considered government-owned or controlled corporations, thus placing their officers under the Ombudsman’s jurisdiction. He also contended the Ombudsman capriciously reduced his graft complaint to a mere contractual issue. The Ombudsman denied reconsideration, noting the motion was filed out of time and reiterating its lack of jurisdiction.

ISSUE

Whether the Office of the Ombudsman committed grave abuse of discretion in dismissing the complaint for lack of jurisdiction over the respondents and the subject matter.

RULING

The Supreme Court dismissed the petition, finding no grave abuse of discretion by the Ombudsman. The legal logic centered on the definition of a government-owned or controlled corporation (GOCC) under prevailing law. For an entity to be considered a GOCC subject to the Ombudsman’s jurisdiction, it must be: (1) organized as a stock or non-stock corporation; (2) vested with functions relating to public needs, whether governmental or proprietary; and (3) owned by the government directly or through its instrumentalities to the extent of at least fifty-one percent of its capital stock, in the case of stock corporations.
Applying these criteria, the Court found the CIIF companies were not GOCCs. While United Coconut Chemicals, Inc. and Granexport Manufacturing Corporation had majority shares (92.85% and 91.24%, respectively) owned by UCPB as administrator of the CIIF (a fund with public character), and Legaspi Oil Company, Inc. had 44.10% ownership, petitioner failed to substantiate the second requisite. There was no showing that these corporations were vested with functions relating to public needs, unlike entities such as PETROPHIL cited in Quimpo v. Tanodbayan. Absent this essential characteristic, they remained private corporations. Consequently, their officers were not public officers under the Anti-Graft Law, and the Ombudsman correctly declined jurisdiction. The Court deemed it unnecessary to resolve ancillary issues, including the charge of forum shopping, as the causes of action in the graft complaint and the separate civil case were distinct.