G.R. No. 168918, March 2, 2009
People of the Philippines, Petitioner, vs. Hermenegildo Dumlao y Castiliano and Emilio La’o y Gonzales, Respondents.

FACTS

An Amended Information was filed before the Sandiganbayan charging respondents Hermenegildo C. Dumlao and Emilio G. La’o, along with others, with violation of Section 3(g) of Republic Act No. 3019 (Anti-Graft and Corrupt Practices Act). The charge stemmed from a Lease-Purchase Agreement dated May 10, 1982, wherein the GSIS, through its Board of Trustees (including Dumlao), agreed to sell a property to private person Emilio La’o under terms alleged to be manifestly and grossly disadvantageous to the government. During pre-trial, the prosecution and respondent Dumlao submitted a Joint Stipulation of Facts. It was stipulated, among other things, that only three out of the seven members of the GSIS Board of Trustees present during the April 23, 1982 meeting signed the minutes (Exhibit “B”) containing the item regarding the approval of the proposed Agreement. Based on this stipulation, Dumlao filed a Motion to Dismiss/Quash on the ground that the facts charged do not constitute an offense, arguing that the Board Resolution approving the contract was not validly passed due to lack of the required majority signatures. The Sandiganbayan granted the motion and dismissed the case against Dumlao, ruling that the resolution was not validly passed since it was signed by only three members, and thus did not effectively approve the Lease-Purchase Agreement. The Sandiganbayan also ordered the case against the still-at-large respondent La’o archived. The People of the Philippines, through the Office of the Ombudsman, appealed the dismissal via a petition for certiorari.

ISSUE

The primary issue is whether the Sandiganbayan acted in accordance with law and jurisprudence in dismissing Criminal Case No. 16699 against respondent Dumlao after pre-trial and before the prosecution could present its witnesses, based on the finding that the GSIS Board Resolution approving the Lease-Purchase Agreement was not validly passed due to insufficient signatures.

RULING

The Supreme Court DENIED the petition and AFFIRMED the Sandiganbayan Resolution. The Court held that the Sandiganbayan did not commit grave abuse of discretion in dismissing the case based on the stipulated facts. The stipulation clearly showed that only three members of the seven-member GSIS Board signed the minutes of the meeting where the Agreement was purportedly approved. Under the Corporation Code, a majority vote of the directors present at a meeting at which there is a quorum is necessary to constitute a valid corporate act. With only three signatures, the required majority was not obtained; therefore, the resolution was not validly passed. Since there was no valid board approval, an essential element of the crime under Section 3(g) of R.A. 3019—that a public officer entered into a contract on behalf of the government—was missing. The contract was not a corporate act of the GSIS but an unauthorized act of its officer. The Court also found no error in the Sandiganbayan’s order to archive the case against respondent La’o, noting that a certification of his death was subsequently submitted, rendering the case against him moot. The dismissal of the case against Dumlao was not a dismissal on the merits that would place him in double jeopardy, as it was based on the insufficiency of the facts alleged and stipulated to constitute the offense charged.