G.R. No. 252423. January 16, 2023.
DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES-PROVINCIAL ENVIRONMENT AND NATURAL RESOURCES OFFICE (DENR-PENRO) OF VIRAC, CATANDUANES, AND PEOPLE OF THE PHILIPPINES, PETITIONERS, VS. EASTERN ISLAND SHIPPING LINES CORPORATION, RESPONDENT.

FACTS

The case stemmed from Criminal Case No. 6531 for violation of Section 77 of Presidential Decree (P.D.) No. 705 against Marvin Soria and Elmer Morauda III. The Information alleged that on March 13, 2018, the accused possessed and transported 196 pieces of lumber products using a ten-wheeler Isuzu dump truck (subject truck) without the necessary DENR documents. The subject truck, with plate no. ACO 1836, was purportedly owned by Eastern Island Shipping Lines Corporation (respondent) and was allegedly leased by a certain Elmer B. Belen from respondent. The lumber and the truck were confiscated. The accused pleaded guilty, and the Regional Trial Court (RTC) rendered a Judgment convicting them. In its Judgment, the RTC ordered the confiscation of the lumber in favor of the government. Regarding the truck, the RTC noted an agreement between the law enforcement officers, the prosecutor, and the defense lawyer to submit documents to prove the truck was used without the knowledge of the registered owner and to prove a Lease Contract, to determine whether to consent to its non-confiscation. Subsequently, the law enforcers manifested they did not consent to the release of the truck. The RTC then issued an Order declaring the confiscation of the truck in favor of the Government. Respondent filed an Omnibus Motion before the RTC to reopen the trial on the confiscation aspect, for intervention/third-party claim, and to release the vehicle, asserting it had no knowledge the truck was used unlawfully and did not consent to or participate in the crime, invoking Article 45 of the Revised Penal Code (RPC). The RTC denied the motion, citing Section 77 of P.D. No. 705, which directs confiscation of the machinery or tools used, and ruled that this special law prevails over Article 45 of the RPC. Respondent filed a petition for certiorari before the Court of Appeals (CA). The CA granted the petition, nullified the RTC Order, and directed the release of the truck to respondent, holding that Article 45 of the RPC applies, that respondent’s right to due process was violated as it was not impleaded, and that respondent proved ownership and non-participation. The DENR-PENRO and the People, through the OSG, filed the present Petition for Review.

ISSUE

Whether the Court of Appeals erred in nullifying the Regional Trial Court’s Order confiscating the subject truck and in ordering its release to the respondent, based on the application of Article 45 of the Revised Penal Code and due process considerations, despite the provisions of Section 77 of P.D. No. 705.

RULING

The Supreme Court DENIED the petition and AFFIRMED the Decision of the Court of Appeals. The Court held that the confiscation of the truck was a penalty under Section 77 of P.D. No. 705, which is a special law. However, the Court ruled that the trial court’s confiscation order violated the respondent’s right to due process. The Court clarified that there are two kinds of confiscation under P.D. No. 705: administrative (under Section 77-A) and judicial (under Section 77). In this case, the confiscation was judicial, ordered by the RTC as a consequence of the criminal conviction. The Court emphasized that while the penalty of confiscation under P.D. No. 705 is mandatory, its enforcement against a third-party owner who is not liable for the offense must comply with due process. The respondent, as the registered owner claiming to be an innocent third party, was entitled to be heard before its property could be confiscated. Since the respondent was not impleaded in the criminal case and was not given an opportunity to present evidence on its ownership and lack of participation, the RTC’s confiscation order was issued with grave abuse of discretion. The Court further held that the provisions of P.D. No. 705 and Article 45 of the RPC can be reconciled. Article 45 provides that instruments used in a crime shall be confiscated unless they belong to a third person not liable for the offense. This principle supplements the special law. The respondent, having proven its ownership through a Certificate of Registration and a Contract of Lease, and having shown it was not involved in the crime, was entitled to the release of the vehicle. The Court also noted that the proper remedy for an innocent third-party claimant is to intervene in the criminal case or file a separate replevin suit, but under the circumstances, the CA correctly granted relief.