G.R. No. 92276 June 26, 1992
REBECCO E. PANLILIO and TRINIDAD DIAZ-ENRIQUEZ, petitioners, vs. SANDIGANBAYAN, Second Division, and PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT, respondents.

FACTS

On August 10, 1989, the Presidential Commission on Good Government (PCGG) filed an information with the Sandiganbayan against petitioners Rebecco E. Panlilio and Trinidad Diaz-Enriquez for violation of the Anti-Graft and Corrupt Practices Act, alleging they induced former President Ferdinand E. Marcos to issue directives for the acquisition and titling of lands and the use of government funds for the Puerto Azul complex. The case was docketed as Criminal Case No. 13784. Petitioners posted bail and filed a motion to quash. They later requested this motion be considered as a motion for reinvestigation. The Sandiganbayan denied the motion to quash but granted the reinvestigation, ordering the PCGG to conduct it and allowing petitioners to submit counter-affidavits. The PCGG set a deadline for submission. Petitioners filed a motion for extension and a “Motion for Clarification” with the Sandiganbayan, questioning the PCGG’s jurisdiction to reinvestigate in light of the new Ombudsman Act of 1989 (Republic Act No. 6770). The Sandiganbayan held the PCGG retained jurisdiction. Petitioners then requested the Ombudsman to conduct the reinvestigation, but the Ombudsman declined. Petitioners moved for reconsideration of the Sandiganbayan’s order. During this period, the PCGG issued an order terminating the reinvestigation due to petitioners’ failure to file counter-affidavits. At the scheduled arraignment, the Sandiganbayan denied the motion for reconsideration. Petitioner Panlilio was arraigned and a plea of “not guilty” was entered for him.

ISSUE

1. Whether the PCGG retained the authority to investigate and reinvestigate ill-gotten wealth cases after the enactment of the Ombudsman Act of 1989.
2. Whether the PCGG possessed the “cold neutrality of an impartial judge” in conducting the reinvestigation.
3. Whether petitioners waived their right to a preliminary investigation.

RULING

1. The Supreme Court ruled that the PCGG retained concurrent authority with the Ombudsman to investigate ill-gotten wealth cases. Section 15(1) of Republic Act No. 6770 gave the Ombudsman primary jurisdiction over cases cognizable by the Sandiganbayan but did not revoke the PCGG’s investigative power. The authority of the PCGG to conduct preliminary investigations in ill-gotten wealth cases is derived from Executive Orders No. 1 and 14. The Ombudsman has primary jurisdiction but may decline to exercise it, allowing a concurrent agency like the PCGG to conduct the investigation. The Court also noted that Section 15(11) of the Ombudsman Act implicitly maintains the PCGG’s authority over ill-gotten wealth amassed before February 25, 1986.
2. The Court ruled that the PCGG did not possess the requisite impartiality. It was impossible for the PCGG to have the “cold neutrality of an impartial judge” as it had gathered the evidence and filed the complaint itself, acting as both prosecutor and judge. The PCGG demonstrated bias by abruptly terminating the reinvestigation without notifying petitioners of its adverse resolution, preventing them from filing a motion for reconsideration or submitting evidence. To ensure a fair administration of justice, the PCGG was disqualified from conducting the reinvestigation.
3. The Court ruled that petitioners did not waive their right to a preliminary investigation. Their failure to submit counter-affidavits was due to the pendency of their “Motion for Clarification” regarding the Ombudsman’s jurisdiction. They consistently indicated they would submit evidence once the jurisdictional issue was resolved. Their actions did not constitute a waiver.
The petition was GRANTED. The preliminary investigation conducted by the PCGG and the information filed in Criminal Case No. 13784 were declared null and void. The PCGG was ordered to transmit the records of PCGG I.S. No. 056 to the Ombudsman for appropriate action.