Republic of the Philippines vs. Eduardo M. Cojuangco, Jr., et al.

G.R. No. 139930, June 26, 2012; per Abad J.

Facts

On August 29, 1979 the Board of Directors of the UCPB authorized to invest not more than P500 million from the fund in the equity of UNICOM for the benefit of the coconut farmers. On September 4, 1979 UNICOM increased its authorized capital stock to 10 million shares without par value. On September 18, 1979, a new set of UNICOM directors approved another amendment to UNICOM’s capitalization by increasing its authorized capital stock to one billion shares. The paid-up subscriptions of 5 million shares without par value were then converted to 500 million Class A voting common shares without par value per share.

Respondents amended again UNICOM’s capitalization giving the incorporators unwarranted benefits by increasing their 1 million shares to 100 million shares without cost to them. The Office of the Solicitor General filed a complaint for violation of Section 3(e) of Republic Act (R.A.) 3019 against respondents, the 1979 members of the UCPB board of directors, before the PCGG. Nine years later, the Office of the Special Prosecutor issued a memorandum that the action has already prescribed.

Issue

Whether or not respondents alleged violation of Section 3(e) of R.A. 3019 already prescribed

Ruling

The Supreme Court ruled that, reckoning the 10-year prescriptive period from the commission of the violation of law of which the last day for filing the action was, at the latest, on February 8, 1990, the action has already prescribed. R.A. 3019 being a special law, the 10-year prescriptive period should be computed in accordance with Section 2 of Act 3326 which states that “prescription shall begin to run from the day of the commission of the violation of the law, and if the same be not known at the time, from the discovery thereof.” In the prosecution of cases of behest loans, the Court reckoned the prescriptive period from the discovery of such loans. The reason for this is that the government, as aggrieved party, could not have known that those loans existed when they were made. Both parties to such loans supposedly conspired to perpetrate fraud against the government.