PEOPLE VS.

DIPUTADO
G.R. No. 213922, July 05, 2017

Facts:

A. Version of the Prosecution

In 2006, an asset of the Office of the Regional Special Anti-Crime Task Force (RSAC-TF) of the PNP
Region 6 went to their Office and gave an information to P/Sr. Insp. Gallardo that a certain Rommel
Dipuitado who was in the Watch List of said Task Force, is engaged in selling drugs in Brgy. San Vicente,
Jaro, Iloilo City. The PNP then conducted surveillance and test buy on the accused. During the test buy,
they were able to purchase suspected shabu from the accused worth P500.00 and when they returned to
their Office, P/Sr. Inspector Gallardo instructed them to conduct a buy-bust operation. Thus, on the morning
of March 7, 2006, P/Sr. Inspector Gallardo conducted a briefing wherein PO1 Estares was designated to be
the poseur-buyer P24,000.00 consisting of five Twenty Peso bills, four of which were authenticated at the
Iloilo City Prosecution Office, and the others were fake money in different denominations.

At around 10:00 am, they positioned themselves at a billiard hall and an eatery where they waited for their
asset. By 12:45 noontime, the accused arrived and as such, PO1 Estares transacted with accused at the
corner of the street for the purchase of shabu worth P24,000.00. Said accused left the place. After a while,
the accused arrived and alighted from a taxi, approached PO1 Estares and PO1 Ambrocio and then he
asked for the money -- the buy-bust money which accused placed inside his pocket and then, he handed to
PO1 Estares a big sachet containing white crystalline substance. They introduced themselves as police
officers and they immediately frisked the accused which resulted to the recovery of the buy-bust money.

At the house of the barangay captain, about 100 meters away , the subject item and the buy-bust money
were recorded/listed by PO2 Lucilo Mayores in a document which was signed by the barangay kagawads
and media representative. After the recording, the items were gathered by PO1 Estares who brought them to
their Office where he marked the plastic sachet with white crystalline substance with RDM, the initial of the
accused. Then, PO1 Estares turned over the listed items to PO1 Alfredo Tilano, the Exhibit Custodian of
RSAC-TF. Thereafter, the items were brought to the Iloilo City Prosecution Office where they were
inventoried before Prosecutor Elvas and in the presence of a barangay kagawad and media representative
who also signed the document relative thereto.
xxxx

B. Version of the Defense

He rode in a taxi in order to go to Brgy. Tabuc-Suba, Jaro, Iloilo City as he was requested by a friend to
butcher a pig. Unfortunately, on the way to his friend and while passing Brgy. San Vicente, Jaro, the taxi
ridden by accused was blocked by three persons, said person brought the accused at the back of the taxi
and after a while, said accused was brought by the persons to the house of the Barangay Captain of Brgy.
San Vicente, about one hundred meters away. At the house of the Barangay Captain, accused was
surprised when the three persons presented money and shabu to the Barangay Captain and he was
directed to point at the said items

RTC of Iloilo City - guilty for violation of Section 5, Article II of R.A. No. 9165 "Comprehensive Dangerous
Drugs At of 2002 for selling a PNP 1 heat-sealed transparent plastic packet containing 3.957 grams of shabu
CA - affirmed the Decision of RTC
SC - reverse CA

Issue: WON RTC AND CA ERRED IN FINDING THAT THE EVIDENCE OF THE PROSECUTION WAS
SUFFICIENT TO CONVICT THE ACCUSED OF THE ALLEGED SALE OF SHABU. -yes

Won guilt beyond resssaobanle doybt was duly priven

Held:
There are procedural lapses or the gaps in the chain of custody:
Accused-appellant claims that the seized illegal drug was not marked immediately after his arrest at the
scene of the crime, neither was it marked at the house of the barangay captain where the seized illegal drug
and the buy-bust money were allegedly initially recorded/listed by PO1 Mayores. The seized illegal drug was
only marked at the office of the Regional Special Anti-Crime Task Force no evidence on record that
photographs were taken during the inventory of the seized items. Another break in the chain of custody,
according to the accused-appellant, was the failure of the prosecution to present PO3 Holleza, the
person who allegedly received the Request for Laboratory Examination.an additional marking, i.e.,
"RGE", on the plastic sachet which was not mentioned in any document presented by the prosecution nor
was it explained by PO1 Estares, PO1 Mayores and PO1 Tilano.

Here, prosecution failed to preserve the integrity and evidentiary value of the seized dangerous drugs.

Elements of successful prosecution : (1) the identity of the buyer and the seller, the object, and the
consideration; and (2) the delivery of the thing sold and the payment therefor. The proof that the transaction
or sale actually took place, coupled with the presentation in court of the corpus delicti. The evidence of the
corpus delicti which is the dangerous drug itself, must be independently established beyond reasonable
doubt.

It is essential that the illegal drugs seized from the suspect is the very same substance offered in
evidence in court as the identity of the drug must be established with the same unwavering exactitude
as that required to make a finding of guilt. The identity and integrity of the corpus delicti must definitely
be shown to have been preserved.

To remove any doubt or uncertainty on the identity and integrity of the seized drug, Section 21 of R.A. No 9165 provides for the
procedure that ensures that what was confiscated is the one presented in court,

(1) The apprehending team having initial custody and control of the drugs shall, immediately after seizure and confiscation, physically
inventory and photograph the same in the presence of the accused or the person/s from whom such items were confiscated and/or
seized, or his/her representative or counsel, a representative from the media and the Department of Justice (DOJ), and any elected
public official who shall be required to sign the copies of the inventory and be given a copy thereof;

(2) Within twenty-four (24) hours upon confiscation/seizure of dangerous drugs, plant sources of dangerous drugs, controlled
precursors and essential chemicals, as well as instruments/paraphernalia and/or laboratory equipment, the same shall be submitted to
the PDEA Forensic Laboratory for a qualitative and quantitative examination;

(3) A certification of the forensic laboratory examination results, which shall be done under oath by the forensic laboratory examiner,
shall be issued within twenty-four (24) hours after the receipt of the subject item/s: Provided, That when the volume of the dangerous
drugs, plant sources of dangerous drugs, and controlled precursors and essential chemicals does not allow the completion of testing
within the time frame, a partial laboratory examination report shall be provisionally issued stating therein the quantities of dangerous
drugs still to be examined by the forensic laboratory: Provided, however, that a final certification shall be issued on the completed
forensic laboratory examination on the same within the next twenty-four (24) hours;

Crucial in proving the chain of custody is the marking of the seized drugs or other related items immediately
after they have been seized from the accused. "Marking" means the placing by the apprehending officer or
the poseur-buyer of his/her initials and signature on the items seized. Marking after seizure is the starting
point in the custodial link., preventing switching, planting or contamination of evidence.

In the present case, PO1 Estares testified that he did not mark the seized item immediately after the arrest
of the accused-appellant at the place where the latter was arrested. PO1 Estares did not mark the seized
item in the house of the barangay captain.

Even if we relax the application of the marking requirement in this case, the same will not suffice to sustain
the conviction of accused-appellant. In this instance, there is nothing in the testimony of PO1 Estares that he
marked the seized item in the presence of accused-appellant. Further, PO1 Estares did not even make any
effort to proffer any justification as to why he failed to mark the seized item at the place of the arrest or even
in the house of the barangay captain.The marking "RDM" only appeared in the Request for Laboratory
Examination.

Another circumstance which rendered the corpus delicti doubtful is the sudden appearance of the marking
"RGE." The said marking was not apparent in any document nor was it explained in the testimonies of PO1
Estares, PO1 Mayores and PO1 Tilano. Forensic. Chemist Rea Villavicencio in court.

The presumption of regularity in the performance of official duties in favor of the police officers will
not save the prosecution's case, given the foregoing lapses and gaps in the chain of custody. The
presumption stands only when no reason exists in the records by which to doubt the regularity of the
performance of official duty. And even in that instance, the presumption of regularity will never be
stronger than the presumption of innocence in favor of the accused. Otherwise, a mere rule of
evidence will defeat the constitutionally enshrined right of an accused.

It is well-settled that an accused-appellant shall be presumed innocent until the contrary is proven
beyond reasonable doubt. The burden lies with the prosecution to overcome this presumption of
innocence by presenting proof beyond reasonable doubt. The prosecution must rest on its own merits and
must not rely on the weakness of the defense.

Since the prosecution was not able to establish an unbroken chain of custody, reasonable doubt exists as to
the guilt of the accused-appellant.

UNIVERSITY OF MINDANAO, INC. vs. BANGKO SENTRAL NG PILIPINAS, ET AL.

G.R. No. 194964-65 January 11, 2016

Facts:

University of Mindanao is an educational institution. For the year 1982, its Board of Trustees was chaired by
Guillermo B. Torres. His wife, Dolores P. Torres, sat as University of Mindanao’s Assistant Treasurer. Before
1982, Guillermo and Dolores incorporated and operated two (2) thrift banks: (1) First Iligan Savings & Loan
Association, Inc. (FISLAI); and (2) Davao Savings and Loan Association, Inc. (DSLAI).

Upon Guillermo B. Torres’ request, Bangko Sentral ng Pilipinas issued a P1.9 million standby emergency
credit to FISLAI. The release of standby emergency credit was evidenced by three (3) promissory notes in
the amounts of P500,000.00, P600,000.00, and P800,000.00. University of Mindanao’s Vice President for
Finance executed a deed of real estate mortgage over University of Mindanao’s property in Cagayan
de Oro City.Bangko Sentral ng Pilipinas granted FISLAI an additional loan of P620,700.00.executed a
promissory note executed another deed of real estate mortgage.

In 1985, FISLAI, DSLAI, and Land Bank of the Philippines entered into a Memorandum of Agreement
intended to rehabilitate the thrift banks, which had been suffering from their depositors’ heavy withdrawals.
Among the terms of the agreement was the merger of FISLAI and DSLAI, with DSLAI as the surviving
corporation. DSLAI later became known as Mindanao Savings and Loan Association, Inc. (MSLAI).

In 1999, Bangko Sentral ng Pilipinas sent a letter to University of Mindanao, informing it that the bank
would foreclose its properties if MSLAI’s total outstanding obligation of P12,534,907.73 remained
unpaid. The UM denied this and alleged in its Complaints that it did not obtain any loan from Bangko Sentral
ng Pilipinas. It also did not receive any loan proceeds from the bank.

RTC CDO and Iligan -- nullify mortgage contracts; in favor of UM

CA - reverse RTC

SC: Petition for Review on Certiorari - reverse CA; reinstate RTC

RTC CDO found that there was no board resolution giving Saturnino Petalcorin authority to execute
mortgage contracts on behalf of UM. RTC Iligan City trial court found that the Secretary’s Certificate issued
was fictitious37 and irregular for being unnumbered.38 It also did not specify the identity, description, or
location of the mortgaged properties.39

The Court of Appeals ruled that "[a]lthough BSP failed to prove that the UM Board of Trustees actually
passed a Board Resolution, based on the Secretary’s Certificate it "clothed Petalcorin with apparent and
ostensible authority to execute the mortgage deed on its behalf. Bangko Sentral ng Pilipinas merely relied in
good faith on the Secretary’s Certificate. Moreover, the Secretary’s Certificate was notarized. This meant
that it enjoyed the presumption of regularity as to the truth of its statements and authenticity of the
signatures. By signing the promissory notes, University of Mindanao was presumed to have knowledge of
the transaction.

Issues:

1 WON respondent Bangko Sentral ng Pilipinas’ action to foreclose the mortgaged properties had already
prescribed; -no

2 WON petitioner University of Mindanao is bound by the real estate mortgage contracts executed by
Saturnino Petalcorin. -no

Held:

I Argument: Petitioner argues that respondent’s action to foreclose its mortgaged properties had already
prescribed.

SC: Not yet prescribed. The prescriptive period for actions on mortgages is ten (10) years from the day they
may be brought. Actions on mortgages may be brought not upon the execution of the mortgage contract but
upon default in payment of the obligation secured by the mortgage. In other words, as a general rule, a
person defaults and prescriptive period for action runs when (1) the obligation becomes due and
demandable; and (2) demand for payment has been made.

ITC, the mortgage contracts in this case were executed by Saturnino Petalcorin in 1982. The maturity dates
of FISLAI’s loans were repeatedly extended until the loans became due and demandable only in 1990.
Respondent informed petitioner of its decision to foreclose its properties and demanded payment in 1999.
The prescriptive period for filing an action may run either (1) from 1990 when the loan became due, (2) or
from 1999 when respondent demanded payment.
II Argument: Petitioner argues that the execution of the mortgage contract was ultra vires. As an
educational institution, it may not secure the loans of third persons. 73 Securing loans of third persons is not
among the purposes for which petitioner was established. 74

SC: Petitioner is correct. This court upheld the validity of corporate acts when those acts were shown to be
clearly within the corporation’s powers or were connected to the corporation’s purposes.

Petitioner does not have the power to mortgage its properties in order to secure loans of other persons. As
an educational institution, it is limited to developing human capital through formal instruction. It is
not a corporation engaged in the business of securing loans of others.

This court ruled that a contract executed by a corporation shall be presumed valid if on its face its
execution was not beyond the powers of the corporation to do or when the evidence contradicts the
presumption.

Presumptions are "inference[s] as to the existence of a fact not actually known, arising from its usual
connection with another which is known, or a conjecture based on past experience as to what course human
affairs ordinarily take."95 Presumptions embody values and revealed behavioral expectations under a given
set of circumstances.

Presumptions may be conclusive96 or disputable.97

Conclusive presumptions are presumptions that may not be overturned by evidence, however strong the evidence is. 98 They are made
conclusive not because there is an established uniformity in behavior whenever identified circumstances arise. They are conclusive
because they are declared as such under the law or the rules. Rule 131, Section 2 of the Rules of Court identifies two (2) conclusive
presumptions:

SEC. 2. Conclusive presumptions.— The following are instances of conclusive presumptions:

(a) Whenever a party has, by his own declaration, act, or omission, intentionally and deliberately led another to believe a particular thing
true, and to act upon such belief, he cannot, in any litigation arising out of such declaration, act or omission, be permitted to falsify it;

(b) The tenant is not permitted to deny the title of his landlord at the time of the commencement of the relation of landlord and tenant
between them.

On the other hand, disputable presumptions are presumptions that may be overcome by contrary evidence. 99 They are disputable in
recognition of the variability of human behavior. Presumptions are not always true. They may be wrong under certain circumstances,
and courts are expected to apply them, keeping in mind the nuances of every experience that may render the expectations wrong. If the
facts exist to set in motion the operation of a disputable presumption, courts may accept the presumption. However, contrary evidence
may be presented to rebut the presumption.

III Argument: Respondent argues that petitioner’s act of mortgaging its properties to guarantee FISLAI’s
loans was consistent with petitioner’s business interests, since petitioner was presumably a FISLAI
shareholder whose officers and shareholders interlock with FISLAI.
SC: Parties dealing with corporations cannot simply assume that their transaction is within the
corporate powers. The acts of a corporation are still limited by its powers and purposes as provided in the
law and its articles of incorporation.

Thus, regardless of the number of shares that petitioner had with FISLAI, DSLAI, or MSLAI, securing loans
of third persons is still beyond petitioner’s power to do. It is still inconsistent with its purposes under the
law104 and its articles of incorporation. Since petitioner is an entity distinct and separate not only from its own
officers and shareholders but also from FISLAI, its interests as an educational institution may not be
consistent with FISLAI’s. Petitioner and FISLAI have different constituencies.

There can be no piercing of the corporate veil as there is no evidence pointing to the possibility that
petitioner used its separate personality to defraud third persons or commit illegal acts. Neither is there
evidence to show that petitioner was merely a farce of a corporation. (Hi JB!)

IV Argument: Petitioner argues that it did not authorize Saturnino Petalcorin to mortgage its properties on its
behalf. There was no board resolution to that effect. Thus, the mortgages executed by Saturnino Petalcorin
were unenforceable.

SC: Truelaloo. Consent of a person cannot be presumed from representations of another, especially if
obligations will be incurred as a result. Contracts entered into by persons without authority from the
corporation shall generally be considered ultra vires and unenforceable against the corporation.

V Argument: Unauthorized acts that are merely beyond the powers of the corporation under its articles of
incorporation are not void ab initio.

SC: No act by petitioner can be interpreted as anything close to ratification. It was not shown that it issued a
resolution ratifying the execution of the mortgage contracts. It was not shown that it received proceeds of the
loans secured by the mortgage contracts. Ratification must be knowingly and voluntarily done.

VI Argument: Respondent argues that Saturnino Petalcorin was clothed with the authority to transact on
behalf of petitioner, based on the board resolution.

SC: The doctrine of apparent authority does not apply if the principal did not commit any acts or conduct
which a third party knew and relied upon in good faith. Saturnino Petalcorin’s authority to transact on behalf
of petitioner cannot be presumed based on a Secretary’s Certificate and excerpt from the minutes of the
alleged board meeting that were found to have been simulated. These documents cannot be considered as
the corporate acts.
VII Argument: Respondent argues that it may rely on the Secretary’s Certificate issued by Aurora de Leon
because it was notarized.

SC: The Secretary’s Certificate was void whether or not it was notarized. Notarization creates a presumption
of regularity and authenticity on the document. This presumption may be rebutted by "strong, complete and
conclusive proof"150 to the contrary. Since the notarized Secretary’s Certificate was found to have been
issued without a supporting board resolution, it produced no effect.

VIII The banking institution is "impressed with public interest" 160 such that the public’s faith is "of paramount
importance. "Banks cannot rely on assumptions. This will be contrary to the high standard of diligence
required of them.

VI Argument: According to respondent, the annotations of respondent’s mortgage interests on the

certificates of titles of petitioner’s properties operated as constructive notice to petitioner of the existence of
such interests. Hence, petitioners are now estopped from claiming that they did not know about the
mortgage.

SC: Annotations are merely claims of interest or claims of the legal nature and incidents of relationship
between the person whose name appears on the document and the person who caused the annotation. It
does not say anything about the validity of the claim or convert a defective claim or document into a valid
one. These claims may be proved or disproved during trial. Thus, annotations are not conclusive upon
courts or upon owners who may not have reason to doubt the security of their claim as their properties' title
holders.