I.

Nature & Definition:

II. Characteristics of Criminal Law

A. General

- Penal laws and those of public security and safety shall be OBLIGATORY upon all who live and
sojourn in the Philippine territory, subject to the principles of public international law, and to
treaty stipulations.

- Persons who are COVERED.

Exceptions:

- Treaty Stipulations (ex. USA & PH – VFA Agreement)

- Principles of Public International Law (SCAM2)

Ient & Schulz vs Tullet Prebon PH

Facts:

 James Ient and Maharlika Schulz, whom of which are the petitioners of this case, are employees
of Tradition Group.

 Tullet Prebon, on the other hand, is a direct competitor of Tradition Group - in the IDB world.

 Sometime in - Aug 2008, petitioners Ient & Schulz we’re tasked to spearhead the execution of
Tradition Group’s expansion and diversification in Asia by the means of establishing a subsidiary
in the Philippines - which would then be - Tradition Philippines.

 On September 19, 2008, Tradition Philippines was officially registered within the SEC (Securities
and Exchange Commission)

 Tullet a Prebon, through one of its directors - Gordon Buchan - filed a case against Villalon,
Chuidan, James Ient as well as Maharlika Schultz, and other Jon & Jane Does. Although Tullet
Prebon’s filling of affidavit was initially dismissed dated; October 15,2008 — by Prosecutor De
Los Trinos

 But then, Tullet Prebon - filed a petition for review of their case to the DOJ Sectrary - Raul M.
Gonzales, which was granted, reversing the decision of the prosecutor. Subsequently, on May
15, 2009 = Prosecutor De Los Trinos filed a case against the petitioners @ the MTC in Makati,
the charges being the petitioners violating Sections 31 & 34 of the Corporation Code.

 With demise, the petitioners filed for a motion of certiorari under Rule 65 before the COA. But
on Aug 12,2009, the motion was denied. James Villalon, the former president and managing
director of Tullet Prebon, as well as Mercedes Chuidian, a former member of the board of
 directors of Tullet Prebon = were accused of violation the Corporation Code = Section 31 &
Section 34, and should be liable under Section 114.

o Section 114 - Violations of the Code

o Section 31 - Liability of Directors, Trustees or Violation Section 34 - Disloyalty of a Director

Issues:

 DOJ Secretary’s track record wherein he has previously proclaimed that Section 31 is not a penal
provision of law, but merely a basis of a cause of action for civil liability.

 Concluding that there was no probable cause that the petitioners were in violation of the
Corporation Ode, nor was Art 8 of the RPC - for conspiracy properly sustained.

 Sec 114 - cannot be used as the respondent of this case - failed to substantiate bad faith, when
in fact - it was just a mere exercise of their rights to seek greener pastures.

 The main issue, or dispute between the petitioners, the respondent, as well as the
administrators included in the case is their failure to agree - of the applicability of section 144 of
the corporation code to section 31 and 34 of the same statute such that criminal liability
attaches to violations of Section 31 & 34.

Ruling:

 the corporation code has no provisions enacting the RPC to the case

 it is merely a regulatory measure and not a primary penal statute

 while sections 31 & 34 are for the the imposition of standards in which should be followed, or
seen as a standards of fidelity on corporate officers and directors - without unduly impeding
them in the discharge of their work with concerns of litigation to impose such sanctions to
corporate officers is to over criminalize the corporation code the criminal liability in this case -
not applicable, since the crimes are not penal in nature

Decision:

• Consolidated petitions - GRANTED, decisions dates Aug 12, 2009 and May 15,2009 by the DOJ
Secretary and the

COA = Reversed & Set Aside.