GR 222364; (September, 2018) (Digest)
G.R. No. 222364 . September 05, 2018.
REPUBLIC OF THE PHILIPPINES, PETITIONER, VS. SANDIGANBAYAN (SECOND DIVISION) AND BLMMM VENTURES, INC., RESPONDENTS.
FACTS
The Republic, through the PCGG, filed Civil Case No. 0004 in 1987 to recover alleged ill-gotten wealth, including two parcels of land originally registered under Andres Genito, Jr., a close associate of former President Ferdinand Marcos. A notice of lis pendens was annotated on the titles but was later lifted by the PCGG in 1989. The properties were subsequently acquired by Asian Bank, which later merged with Metrobank. In 2001, the PCGG issued a “Notice of Sequestration” over the bank’s titles, annotating it as an encumbrance. The Sandiganbayan, in a 2012 Decision, dismissed the main case against the original defendants, finding the properties were not ill-gotten. In 2012, respondent BLMMM Ventures, Inc. (BVI) purchased the properties from a successor-in-interest of Metrobank. BVI then moved to cancel the annotation of the Notice of Sequestration on its new titles, arguing the dismissal of the main case extinguished the basis for the annotation.
ISSUE
Whether the Sandiganbayan committed grave abuse of discretion in granting BVI’s motion to cancel the annotation of the Notice of Sequestration on the certificates of title.
RULING
No, the Sandiganbayan did not commit grave abuse of discretion. The Supreme Court affirmed the Sandiganbayan’s orders. The legal logic rests on the nature and effect of the dismissal of the main case and the character of the annotated notice. The annotation on the title was a “Notice of Sequestration.” A sequestration is a provisional remedy, a conservatory measure to preserve assets pending litigation to determine if they are ill-gotten. It is not an instrument creating a real right or lien over the property itself. Its legal efficacy is entirely dependent on the outcome of the main case. When the Sandiganbayan dismissed Civil Case No. 0004 with finality, it conclusively determined that the properties were not ill-gotten wealth. This final dismissal removed the very foundation and legal justification for the sequestration order. Consequently, the annotation, which was merely a notice of that provisional order, lost all legal force and effect. It became a superfluous encumbrance on BVI’s title. The Court emphasized that the PCGG’s sequestration power is not absolute; it is ancillary to a main action. With the main action terminated in favor of the defendants (and their successors-in-interest), the ancillary remedy must necessarily fall. Therefore, the Sandiganbayan correctly ordered the cancellation of the annotation to clear BVI’s title, an act within its sound discretion to effectuate the consequences of its final judgment.