G.R. No. 89553 . April 7, 1993.
REPUBLIC OF THE PHILIPPINES (Represented by the Presidential Commission on Good Government), petitioner, vs. THE HONORABLE SANDIGANBAYAN (SECOND DIVISION) and PETER A. SABIDO, respondents.

FACTS

1. On March 17, 1986, the Presidential Commission on Good Government (PCGG) sequestered the Philippine Integrated Meat Corporation (PIMECO).
2. On July 29, 1987, the Republic, through the PCGG, filed a complaint (Civil Case No. 0024) with the Sandiganbayan against, among others, Peter Sabido, for reconveyance, reversion, accounting, restitution, and damages involving PIMECO and other assets alleged to be ill-gotten.
3. On April 28, 1989, Sabido filed an Urgent Manifestation and Motion with the Sandiganbayan, citing newspaper reports that the PCGG intended to turn over the management, control, and possession of PIMECO to the Government Service Insurance System (GSIS) through its subsidiary, Meat Packaging Corporation of the Philippines (MPCP). Sabido argued that such a turnover required court approval since PIMECO, as a sequestered asset, was in custodia legis.
4. The Sandiganbayan ordered the PCGG to comment. Before it could do so, Sabido filed another Urgent Manifestation and Motion on May 19, 1989, informing the court of further reports that the turnover had been effected and urging the court to declare it null and void for lack of court approval.
5. On June 21, 1989, during a hearing on Sabido’s motions, the Sandiganbayan received an undated communication from the PIMECO labor union’s officials and board members opposing the turnover and requesting a temporary restraining order. The court issued a temporary restraining order on the same day.
6. On June 22, 1989, the Sandiganbayan issued a resolution granting a writ of preliminary injunction, enjoining the PCGG from proceeding with the projected turnover of PIMECO to GSIS/MPCP or from interfering with its present management.
7. On July 31, 1989, the Sandiganbayan amended its resolution, further enjoining the PCGG from replacing, dismissing, demoting, reassigning, grounding, or otherwise prejudicing the present members of the PCGG management team in PIMECO, except for valid and serious reasons not attributable to their opposition to the turnover.
8. The PCGG filed this petition to annul and set aside the Sandiganbayan’s resolutions.

ISSUE

Whether the Sandiganbayan acted with grave abuse of discretion in issuing the writ of preliminary injunction enjoining the PCGG from turning over the management of sequestered PIMECO to GSIS/MPCP and from interfering with or replacing its management team.

RULING

The Supreme Court DISMISSED the petition and AFFIRMED the challenged resolutions of the Sandiganbayan.
1. The Sandiganbayan has jurisdiction to review PCGG acts for grave abuse of discretion. While the PCGG is allowed a free hand in exercising its administrative or executive functions, the Sandiganbayan is empowered to determine if, in doing so, the PCGG has gravely abused its discretion or overstepped its legal boundaries. The Sandiganbayan has exclusive and original jurisdiction over cases involving the PCGG, including challenges to its acts or orders. When a law confers jurisdiction upon a court, it is deemed to have all incidental powers necessary to render such jurisdiction effective.
2. The PCGG’s projected transfer of PIMECO’s management was beyond its powers as a conservator. The Court found that the projected transfer of PIMECO’s management to MPCP was unwarranted and was effected by the PCGG beyond the scope of its powers under the law. Such a turnover is equivalent to performing an act of ownership, which the PCGG cannot exercise. The PCGG is merely a conservator or caretaker that can exercise only powers of administration over sequestered, frozen, or provisionally taken-over property. Its power to sequester is akin to the provisional remedy of preliminary attachment, which is always subject to the control of the Sandiganbayan. In exercising its functions, the PCGG must bear in mind that it can only do acts necessary to conserve and preserve sequestered assets.
DISSENTING OPINION (Justice Davide, Jr.):
Justice Davide dissented, voting to grant the petition. He argued:
* The Sandiganbayan should not have issued the temporary restraining order in favor of the PIMECO labor union officials and board members, as they were not parties in Civil Case No. 0024 and had not formally intervened.
* Even if their communication were liberally considered as an intervention, it was unverified, failing to comply with the Rules of Court for issuing a preliminary injunction.
* The Sandiganbayan acted precipitously in issuing the writ of preliminary injunction on June 22, 1989, based on an application filed only a day earlier (June 21) that lacked a notice of hearing, making it a “mere scrap of paper.”
* The amendment of the writ to protect the PCGG’s own management team constituted undue interference with the PCGG’s prerogative over its subordinates, who serve at its pleasure.
* The majority’s ruling that the transfer was unwarranted and beyond the PCGG’s powers prejudged the main issue still pending before the Sandiganbayan.