SC orders Manila court to prosecute mall magnate Jose Go
abs-cbnNEWS.com | 11/02/2009 5:45 PM
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MANILA - The Supreme Court (SC) has ordered the Regional Trial Court (RTC) of Manila to proceed with the criminal prosecution of tycoon Jose Go for allegedly guaranteeing loans and borrowing at least P2.75 billion worth of deposits from his now defunct Orient Commercial Banking without the approval of the bank’s board of directors.
In a 13-page decision authored by Associate Justice Arturo Brion, the high court’s second division denied the petition for review filed by Go seeking the nullification of the Court of Appeals’ ruling issued in 2006 which reversed the Manila RTC's decision to quash the information against him.
Go owns Ever Gotesco shopping mall and Orient Commercial Bank, which was padlocked in 1998.
Go argued that the CA erred in reversing the decision of the Manila RTC, which found the complaint against him vague.
He said that Republic Act 337 or the General Banking Act filed against him by the Bangko Sentral ng Pilipinas penalized only directors and officers of banking institutions who acted either as borrower or as guarantor, but not as both.
He pointed out that Section 83 of the law allowed banks to extend credit accommodations to their directors, officers, and stockholders, provided it is "limited to an amount equivalent to the respective outstanding deposits and book value of the paid-in capital contribution in the bank."
Since the information filed against him failed to state that the amount he purportedly borrowed and/or guaranteed was beyond the said limit, Go insisted he did not violate the law.
However, the SC said that Section 83 of RA 337 generally prohibits a bank director or officer from becoming an obligor of the bank without securing the necessary written approval of the majority of the bank’s directors.
"To make a distinction between the act of borrowing and guarantying is therefore unnecessary because in either situation, the director or officer concerned becomes an obligor of the bank against whom the obligation is juridically demandable," the court noted.
Even assuming that the information filed against Go do not constitute an offense, the SC said it was erroneous for the Manila court to immediately dismiss the case without giving the prosecution a chance to amend the complaint.
Section 4 of Rule 117 of the Rules of Criminal Procedure, according to the high tribunal, requires that the prosecution should be given a chance to correct the defect and the court can order the dismissal if the prosecution failed to do so.
"The RTC’s failure to provide the prosecution this opportunity constitutes an arbitrary exercise of power that was correctly addressed by the CA through the certiorari petition. This defect in the RTC’s action on the case, while not central to the issue before us, strengthens our conclusion that this criminal case should be resolved through full-blown trial on the merits," it added.
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