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DISQUALIFICATION BY REASON OF MARRIAGE / PRIVILEGED COMMUNICATION G.R. No. L-568 July 16, 1947 THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. JUAN FRANCISCO, defendant-appellant. HILADO, J.: Convicted of the crime of parricide by the Court of First Instance of Mindoro, Juan Francisco appeals to this Court and asks us to reverse the decision of the trial court and to acquit him of the crime charged. On March 4, 1945, defendant, who had been previously arrested on charges of robbery, was being held as detention prisoner in the municipal jail of Mansalay, Mindoro. On that date he requested permission from the chief of police, and he was allowed to go with Sergeant Pacifico Pimentel, who was detailed to guard him. Upon their reaching the house, the sergeant allowed the prisoner to see his wife who was at the time in a room of said house, while said sergeant remained at the foot of the stairs. After a few moments, Pimentel heard the scream of a woman. Running upstairs, he met defendant's wife running out of the room and holding her right breast which was bleeding. Still moments later, Pimentel saw defendant lying down with his little son Romeo, aged one year and a half, on his breast. Pimentel also found defendant to have a wound in his belly while his child had a wound in the back. Pimentel found the child dead. The prosecution, in recommending the imposition of the capital penalty upon the accused, relies mainly on: (1) the affidavit, Exhibit C (translation, Exhibit C-1), which is a virtual confession of the accused; (2) Exhibit D, which is the record made by the justice of the peace of Mansalay of the arraignment of the defendant upon which the latter entered a plea of guilty; and (3) the rebuttal testimony of Emilia Taladtad, wife of the appellant. Exhibit C is an affidavit signed and sworn to by the appellant before the justice of the peace of Mansalay on March 5, 1945,. Exhibit C-1 is its English translation. In said affidavit appellant declares that: "I asked permission from the chief of police so that I may be able to raise my bond and to indicate to me the house of one Guillermo Gervasio, a policeman, and I was consented and the sergeant of police accompanied me to my house; that upon arriving at the house, Sgt. Pacifico Pimentel allowed me to go up in order that I may be able to talk to my wife and the sergeant of police awaited me in the stairs of the house; when I was in the house, I remembered what my uncle told me to the effect that he would order someone to kill me because I am a shame and a dishonor to our family and suddenly I lost my sense and I thought to myself that if someone would kill me it would be more preferable for me to kill myself; when I looked at the bed I saw a scissor near my wife and unconsciously I picked up the said scissor and immediately stabbed my wife whereupon I looked for my child on the bed and stabbed him; I killed my son Romeo Francisco whose age is more or less two years and after that I stabbed myself; after stabbing myself, I heard a shot and the sergeant of police asked me if I would surrender to him or not; I replied him "yes" then I lost my consciousness." Sergeant of Police Pimentel, whose veracity we find in the evidence no reason to doubt, declared (p. 6, t.s.n., Lunar) that the accused confessed to him that because he was already tired or disgusted with his life "on account of the accusation of his father-in-law" against him, he wanted to wipe out his family by stabbing his wife, his son and himself, and killing the three of them. The same witness also stated (p. 9, ibid.) that the accused confessed to him that he stabbed his wife, his child and himself because he was ashamed, as his father-in-law told him that he should rather die than live in shame for having dishonored the family of his wife. The voluntariness and spontaniety of the confession contained in Exhibit C was testified to by the justice of the peace of Mansalay and police sergeant Pimentel, one Sebastian Punzalan, and the chief of police Alfredo Iwahi; that said justice of the peace had previously read the contents of the same affidavit to the accused and that the accused signed without any intimidation having been exerted in the presence of said justice of the peace; that the accused signed voluntarily in the session hall of the justice of the peace court in Barrio Paclasan (pp. 26-27, ibid.) Pimentel testified, upon the same point, that no force was exerted upon appellant to state what is contained in the affidavit; that he had not maltreated or boxed the accused as pretended by the latter; that the contents of the exhibit were read to the accused; that he did not threatened the accused to shoot the latter if he would not swear to Exhibit C before the justice of the peace, as declared by said accused (pp. 25-26, ibid.) In this connection we note from the testimony of the accused himself that on the way to the house of the justice of the peace after the incident, he was being helped by the chief of police Iwahi when, according to him, Sergeant Pimentel told him that he was going to swear to the contents of Exhibit C and that if he would not do so Pimentel would shoot him (p. 17, ibid.); that (the same accused assured the court) Iwahi treated him well (t.s.n., p. 20, ibid.); and really from the entire testimony of this accused the good treatment accorded him by Chief of Police Iwahi is clearly discernible. He was under preventive detention in the house of Iwahi and it was Iwahi who suggested or told him, after he had killed and dressed the former's pig, that he bring a kilo of the meat to his (appellant's) wife (p. 13, ibid.) It was also Iwahi who allowed him to go to his house on the same occasion for the purposes of the procurement of his bail (p. 13, ibid.). Under these circumstances, besides the complete absence of proof of any reason or motive why Pimentel should so threaten the accused, we find the accused's version incredible. On page 16 of the same transcript, answering a question by the Court of First Instance, the accused testified that he understands English and the translation Exhibit C-1 of the affidavit Exhibit C is in that language. Other indications of appellant's lack of trustworthiness are: While on page 14 of said transcript he testified that he was the only one who went to the house of his wife because Pimentel, according to him, remained in the house of Roberto Magramo, on page 13 he declared that he was accompanied by the sergeant of police of Mansalay, Pacifico Pimentel to the house of his wife and that the chief of police ordered Pimentel to so accompany him. Contradicting the same pretension of his having gone alone to his wife's house is his own testimony on page 17 of the transcript wherein he assured affirmatively the question of his own counsel whether Pimentel was the policeman who was with him to guard him on the occasion of his going to his wife's house; and really, while he imputed upon his wife the wounding of their child, who died as a consequence thereof, he admitted that he did not tell this to the justice of the peace of Mansalay (p. 18, ibid.), and the reason he assigned for this passive conduct on his part to the effect that he was afraid of Pimentel (p. 19, ibid.) is patently unacceptable, for no motive whatsoever has been established to make us believe that the accused had reasons to be so afraid of Pimentel. Appellant's testimony to the effect that Pacifico Pimentel was testifying against him because Pimentel "being my guard that time he might be held responsible for allowing me to go alone" (p. 17, ibid.) is absolutely without merit. This testimony clearly reveals a desire to show that because Pimentel allowed the accused to go up the house while the former stayed at the foot of the stairs, said Pimentel would be responsible for what had happened unless the accused was the one who killed the child and wounded his wife rather than the wife having accidentally wounded the child and killed him and been stabbed by the accused, who also stabbed himself. As we said a moment ago, we do not give any merit to this purpose in testifying against the accused to relieve himself of all responsibility for what had happened, it would have been more conducive to this result if Pimentel had testified that it was not the accused, whom he had allowed to go upstairs unguarded, who was guilty, but his wife, of the wounding of the child, and that the accused wounded his wife only as the result of the obfuscation produced by the child's death. And the fact that Pimentel gave the version which might place no small blame on him for allowing the accused to go up the house alone, gives special weight to his testimony. This case, as developed by the evidence for the prosecution, which has not been destroyed nor enervated by that of the defense, presents a truly strange happening. But the fact of the commission of the crime of parricide appears to us to have been established beyond reasonable doubt. As to the reasons impelling the commission of the act, the case is a strange one and admittedly not common. But while it is not necessary even to prove motive in case the commission of the crime is established as required by law (U.S. vs. Ricafor, 1 Phil., 173; U.S. vs. McMann, 4 Phil., 561; U.S. vs. Reyes, 18 Phil., 495; U.S. vs. Balmori and Apostol, 18 Phil., 578), here we have a case of a crime proven beyond reasonable doubt, not absolutely without a proven motive, but with proof of a motive testified to by the accused himself in his confession, strange though it be. But at times "truth is stranger than fiction," and it so happens here. The law must be applied to the facts.

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We have scanned and searched the evidence and the record diligently for facts and circumstances which might sufficiently establish insanity or any allied defense, but we have failed to find them. As we construe the evidence, we believe that Exhibit C contains the truth, as narrated by the accused himself who, at the time of making it, must have been moved only by the determination of a repentant father and husband to acknowledge his guilt for facts which, though perhaps done under circumstances productive of a diminution of the exercise of will-power, fell short of depriving the offender of consciousness of his acts. We will have occasion to further consider this aspect of the case later. Exhibit C was signed and sworn to by appellant the day following the fatal event. Presumably, on making this confession appellant had not yet had time to reflect upon the consequences of such a confession to himself egoism was not yet allowed to operate against the promptings of his conscience. But when on February 23, 1946 almost one year after this man testified in his own defense in the Court of First Instance, he already had had ample opportunity to reflect upon those consequences. And what happened? As in similar cases, he repudiated his confession, and alleged torture and violence to have been exerted upon his person and his mind in order, so he now pretends, to extract it from him. As we find the confession to have been given voluntarily, we feel justified in concluding that its subsequent repudiation by the accused almost a year after must have been due to his fear of its consequences to himself, which he not improbably thought might cost him his own life. It was the struggle between the noble and the ignoble in the man, and the latter, aided by instinct of self-preservation, won. Defense counsel attacks the value of Exhibit C as evidence of guilt for the reason that the statements contained therein were not, counsel contends, given spontaneously but through use of violence and intimidation. He also questions the admissibility of Exhibit D on the ground that it has not been properly identified; and, with more vigor and stronger emphasis, he impugns the admissibility of the testimony of appellant's wife, invoking the provision of section 26 (d) of Rule 123 prohibiting the wife and the husband from testifying for or against each other. As to Exhibit C, this document was sworn to and subscribed by said accused before the justice of the peace of Mansalay. This official testified that he asked the prisoner before the latter signed said exhibit whether he understood the contents thereof, and that said latter answered in the affirmative. The witness further declared that appellant signed the exhibit voluntarily and that said appellant said that the said affidavit was his (p. 10, ibid.). There is a total absence of evidence, besides the testimony of appellant himself, to show that his statements contained in said exhibit were extracted form him by the use of violence and intimidation. While we are not unaware of the practice resorted to by some peace officers of extracting admissions or confessions from persons accused of crime by the employment of third-degree methods, in the present case we fail to find from the evidence sufficient proof to destroy the categorical testimony of the justice of the peace that Exhibit C was signed by appellant voluntarily and with a full understanding thereof. Furthermore, the statements of appellant in said Exhibit C were corroborated by the testimony of his wife on rebuttal. This leads us to the consideration of the admissibility of the wife's testimony. The rule contained in section 265 (d) of Rule 123 is an old one. Courts and text-writers on the subject have assigned as reasons therefor the following: First, identity of interest; second, the consequent danger of perjury; third, the policy of the law which deems it necessary to guard the security and confidences of private life even at the risk of an occasional failure of justice, and which rejects such evidence because its admission would lead to domestic disunion and unhappiness; and fourth, because where a want of domestic tranquility exists, there is danger of punishing one spouse through the hostile testimony of the other. This has been said in the case of Cargill vs. State (220 Pac., 64; 25 Okl. Cr., 314; 35 A.L.R., 133), thus: The reasons given by law text-writers and courts why neither a husband nor wife shall in any case be a witness against the other except in a criminal prosecution for a crime committed by one against the other have been stated thus: First, identity of interests; second, the consequent danger of perjury; third, the policy of the law which deems it necessary to guard the security and confidences of private life even at the risk of an occasional failure of justice, and which rejects such evidence because its admission would lead to domestic disunion and unhappiness; and fourth, because, where a want of domestic tranquility exists, there is danger of punishing one spouse through the hostile testimony of the other. (70 C.J., 119.) However, as all other general rules, this one has its own exceptions, both in civil actions between the spouses and in criminal cases for offenses committed by one against the other. Like the rule itself, the exceptions are backed by sound reasons which, in the excepted cases, outweigh those in support of the general rule. For instance, where the marital and domestic relations are so strained that there is no more harmony to be preserved nor peace and tranquility of interests disappears and the consequent danger of perjury based on that identity is non-existent. Likewise, in such a situation, the security and confidences of private life which the law aims at protecting will be nothing but ideals which, through their absence, merely leave a void in the unhappy home. At any rate, in the instant case the wife did not testify in the direct evidence for the prosecution but under circumstances presently to be stated. It will be noted that the wife only testified against her husband after the latter, testifying in his own defense, imputed upon her the killing of their son. (p. 15, ibid.) By all rules of justice and reason this gave the prosecution, which had theretofore refrained from presenting the wife as a witness against her husband, the right to do so, as it did in rebuttal; and the the wife herself the right to so testify, at least, in self-defense, not of course, against being subjected to punishment in that case in which she was not a defendant but against any or all of various possible consequences which might flow from her silence, namely: (1) a criminal prosecution against her which might be instituted by the corresponding authorities upon the basis of her husband's aforesaid testimony; (2) in the moral and social sense, her being believed by those who heard the testimony orally given, as well as by those who may read the same, once put in writing, to be the killer of her infant child. It has been aptly said that the law of evidence is the law of common sense. Presuming the husband who so testified against his wife to be endowed with common sense, he must be taken to have expected that the most natural reaction which the said testimony would give rise to on the part of the prosecution, as well as of his wife, was to deny upon rebuttal the new matter which was involved in the same testimony, namely, the imputation that it was his wife who killed their little son. Upon the part of the prosecution, because he not only limited himself to denying that he was the killer, but went further and added what was really a new matter consisting in the imputation of the crime upon his wife. And upon the part of the wife, because of the reasons already set forth above. Hence, in giving such testimony, the husband must, in all fairness, be held to have intended all its aforesaid natural and necessary consequences. By his said act, the husband himself exercising the very right which he would deny to his wife upon the ground of their marital relations must be taken to have waived all objection to the latter's testimony upon rebuttal, even considering that such objection would have been available at the outset. At this point, it behooves us to emphasize the all-important role of the State in this case. The State being interested in laying the truth before the courts so that the guilty may be punished and the innocent exonerated, must have the right to offer the rebutting testimony in question, even against the objection of the accused, because it was the latter himself who gave rise to its necessity. It may be said that the accused husband thought that he would have more chances of convincing the court of his pretended innocence if he pointed to his wife as having caused the death of their child, instead of simply denying that he was the author of the fatal act. To this we would counter by saying that if he was to be allowed, for his convenience, to make his choice and thereby impute the act upon his spouse, justice would be partial and one-sided if both the State and the wife were to be absolutely precluded from introducing the latter's rebutting testimony. As well-settled as this rule of marital incompetency itself is the other that it may be waived. Waiver of incompetency. Objections to the competency of a husband or wife to testify in a criminal prosecution against the other may be waived as in the case of the other witnesses generally. Thus, the accused waives his or her privilege by calling the other spouse as a witness for him or her, thereby making the spouse subject to cross-examination in the usual manner. It is well-established that where an accused introduces his wife as a witness in his behalf, the state is entitled to question her as to all matters germane and pertinent to her testimony on direct examination. It is also true that objection to the spouse's competency must be made when he or she is first offered as witness, and that the incompetency may be waived by the failure of the accused to make timely objection to the admission of the spouse's testimony,

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although knowing of such incompetency, and the testimony admitted, especially if the accused has assented to the admission, either expressly or impliedly. Other courts have held that the witness's testimony is not admissible even with the other spouse's consent. Clearly, if the statute provides that a spouse shall in no case testify against the other except in a prosecution for an offense against the other, the failure of the accused to object does not enable the state to use the spouse as a witness. (3 Wharton's Criminal Evidence, 11th Ed., section 1205, pp. 2060-2061.) Wharton, in note 10 at the foot of page 2060 of the cited volume refers us to section 1149 appearing on page 1988 of the same volume, dealing with waiver objection to incompetency of witnesses in general. We transcribe this section for convenient reference: Waiver of objection to incompetency. A party may waive his objection to the competency of a witness and permit him to testify. A party calling an incompetent witness as his own waives the incompetency. Also, if, after such incompetency appears, there is failure to make timely objection, by a party having knowledge of the incompetency, the objection will be deemed waived, whether it is on the ground of want of mental capacity or for some other reason. If the objection could have been taken during the trial, a new trial will be refused and the objection will not be available on writ of error. If, however, the objection of a party is overruled and the ruling has been excepted to, the party may thereafter examine the witness upon the matters as to which he was allowed to testify to without waiving his objections to the witness's competency. (Ibid., section 1149, p. 1988.) It will be noted, as was to be expected, that in the last above-quoted section, the author mentions certain specific cases where the courts concerned hold that there was waiver, but for obvious reasons neither the author nor said courts have attempted to make an enumeration of all possible cases of waiver. In the very nature of things, it would be impossible to make a priori such a complete enumeration and to say that it is exclusive. So long as the Legislature itself does not make its own statutory and exclusive specification of cases of such waiver and we doubt that it ever will no complete and exclusive enumeration can, nor should, be attempted by the courts, for in the absence of such legislation the cases of waiver will be as indefinite in number as indefinite are and always will be the varying and unpredictable circumstances surrounding each particular case. To illustrate, Mr. Wharton says above that the accused waives his or her privilege by calling the other spouse as a witness for him or her, thereby making the spouse subject to cross-examination in the usual manner, the reason being that the State is entitled to question the spouse so presented as to all matters germane and pertinent to the direct testimony. In the same way, and for a similar reason, when the herein appellant gave his testimony in question in his defense, the State had the right to rebut the new matter contained in that testimony consisting in the imputation upon his wife of the death of the little boy. And that rebuttal evidence, which was rendered necessary by appellant's own testimony, could be furnished only by his wife who, as he fully knew, was alone with him and their son at the precise place and time of the event. This right to rebut is secured to the State, no less than to the accused, by Rule 115, section 3, paragraph (c), the provision further authorizing the court, in furtherance of justice, to permit one or the other party to offer "new additional evidence bearing upon the main issue in question." So that if the waiver that we here declare to flow from the above-mentioned testimony of appellant does not happen to be among those which were mentioned in the cases cited by Mr. Wharton, that is no reason against the existence of said waiver. When the husband testified that it was his wife who caused the death of their son, he could not, let us repeat, justly expect the State to keep silent and refrain from rebutting such new matter in his testimony, through the only witness available, namely, the wife; nor could he legitimately seal his wife's lips and thus gravely expose her to the danger of criminal proceedings against her being started by the authorities upon the strength and basis of said testimony of her husband, or to bear the moral and social stigma of being thought, believed, or even just suspected, to be the killer of her own offspring. A decent respect and considerate regard for the feelings of an average mother will tell us that such a moral and social stigma would be no less injurious to her than a criminal punishment. And if the wife should, in such a case and at such a juncture, be allowed to testify upon rebuttal, the scope of her testimony should at least be the same as that of her husband. This is only simple justice and fairness dictated by common sense. Since the husband had testified that it was his wife who caused the death of the little boy, she should be allowed to say that it was really her husband who did it. We hold that it is not necessary, to justify such rebuttal evidence, and to declare the existence of the waiver upon which it was based, that the wife be in jeopardy of punishment in the same case by reason of such testimony of her accused husband. The rule of waiver of objection to the competency of witnesses generally does not require this prerequisite in the case between husband and wife. Rather the rule makes the determination of the question hinge around the consequences which by common sense, in justice and in fairness, should be deemed to have been expected by the spouse who first testified naturally to flow from his act of giving that testimony. At any rate, the trial court not only had the power to allow the State to utilize the wife as rebuttal witness, but also the discretion to permit "new additional evidence bearing upon the main issue in question." But even restricting the wife's testimony to merely contradicting her husband's version that she was the one who killed their child, there is evidence beyond reasonable doubt that appellant was the killer. With the testimony of both spouses upon the point, instead of that of the accused alone, let justice take its course. As to Exhibit D, this document was a part of the record of the case in the justice of the peace of court which was expressly presented by the prosecution as evidence in the Court of First Instance. But after all has been said and done, in justice to the accused, we believe that, whether we are dealing with a simpleton or an eccentric, or we have here one of those well-nigh inexplicable phenomena in human conduct where the judge finds himself at a loss to discover an adequate motivation for the proven acts of the accused, indulging all reasonable intendments in favor of appellant, we are of opinion that when he committed the crime charged against him he must have been suffering from some illness (of the body, the mind, the nerves, or the moral faculty) as is contemplated in paragraph 9 of article 13 of the Revised Penal Code as a mitigating circumstance, namely, "such illness of the offender as would diminish the exercise of the will-power of the offender without however depriving him of consciousness of his acts." Article 246 of the Revised Penal Code punishes parricide by the penalty of reclusion perpetua to death. Article 63, paragraph 3, of the same code, provides that when the commission of the act is attended by some mitigating circumstance and there is no aggravating circumstance, and the law prescribes a penalty composed of two indivisible penalties, the lesser penalty shall be applied; in this case, in view of the above indicated circumstance and there being no aggravating circumstance, the lesser penalty is reclusion perpetua, which was the penalty correctly applied by the trial court, which penalty, of course, carries with it the accessory penalties provided for in article 41 of the said Code. The accused should also be sentenced to indemnify the heirs of the deceased Romeo Francisco in the sum of P2,000, and to pay the costs. As above modified, the appealed judgment is affirmed, with costs against appellant. So ordered. PADILLA, J.: I concur in the result. To my mind the evidence is sufficient to support the judgment of conviction without taking into consideration the testimony of the appellant's wife in rebuttal. I agree with Mr. Justice Feria in his dissent that she is incompetent to testify against the appellant, her husband, there being an objection to her testifying against him. Separate Opinions PABLO, M., concurrente y disidente: Concurro con la opinion de la mayoria en cuanto condena al acusado. En mi opinion aun sin tener en cuenta la declaracion de la esposa del acusado en contra-pruebas, obra en autos concluyente prueba que establece la culpabilidad del acusado.

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En cuanto a la interpretacion de la Regla 123, articulo 26, seccion (d), concurro con la disidencia del Magistrado Sr. Feria. La declaracion de la esposa debe ser excluida como prueba contra el acusado, por inadmissible. FERIA, J., dissenting: Without necessity of discussing the merits of the case and deciding whether the appellant's conviction by the Court of First Instance must be affirmed or reversed, for the majority has decided to affirm it and it would be useless now for the undersigned to dissent from or concur in the conviction of the appellant, we dissent from the new theory enunciated in the majority opinion that the appellant's testimony to the effect that his wife was the one who unintentionally inflicted the wound which caused the death of the child, capacitated his wife to testify as a witness on rebuttal against her husband, and "constituted a waiver of all objections to her testimony." The pertinent portion of the majority decision reads as follows: "The reasons given by law text-writers and courts why neither a husband nor wife shall in any case be a witness against the other except in a criminal prosecution for a crime committed by one against the other have been stated thus: First, identity of interests, second, the consequent danger of perjury; third, the policy of the law which deems it necessary to guard the security and confidences of private life even at the risk of an occasional failure of justice, and which rejects such evidence because its admission would lead to domestic disunion and unhappiness; and fourth, because, where a want of domestic tranquility exists, there is danger of punishing one spouse through the hostile testimony of the other. (70 C.J., 119)" However, as all other general rules, this one has its own exceptions, both in civil actions between the spouses and in criminal cases for offenses committed by one against the other. Like the rule itself, the exceptions are backed by sound reasons which, in the excepted cases, outweigh those in support of the general rule. For instance, where the marital and domestic relations are so strained that there is no more harmony to be preserved nor peace and tranquility which may be disturbed, the reason based upon such harmony and tranquility fails. In such case identity of interests disappears and the consequent danger of perjury based on that identity is nonexistent. Likewise, in such a situation, the security and confidences of private life which the law aims at protecting will be nothing but ideals which, through their absence, merely leave a void in the unhappy home." The new theory of the majority is evidently untenable for it is predicated upon the incorrect premise or assumption that the abovementioned reasons or grounds of the incapacity of one of the spouses to testify against the other in a proceeding in which the latter is a party, are also applicable to testimony of one spouse against the other who is not a party to the cause which it is offered or given, as in the present case. This premise or assumption is incorrect, for said reasons do not apply to the latter case. Were it applicable, the law would have also disqualified one spouse to give testimony which in any way disparages or disfavor the other although the latter is not a party to the cause; but the law does not so. The prohibition contained in section 26 (d) of Rule 123 only relates to cases in which the testimony of a spouse is offered for or against the other in a proceeding to which the latter is a party (U.S. vs. Concepcion, 31 Phil., 182; People vs. Natividad, 70 Phil., 315). And the reason is obvious. Although the testimony of the husband against his wife who is not a party to the case is admissible; yet, as said testimony can not be used as evidence against the wife in a civil case or criminal prosecution against her, it would not effectively strain the marital and domestic relations; lead to domestic disunion and unhappiness; disturb the peace, harmony, and tranquility of the family, and destroy the identity of interest. Such testimony, far from producing said results, might have a different effect. Where one of the spouses testifies in his defense that the other spouse, who is not a party to the case, is the one who committed the crime charged, his testimony, if believed by the court, would result in the acquittal and release of the defendant spouse and enable the accused, if confined in prison, to join again his spouse, without placing the latter in danger of being prosecuted and convicted by his testimony. In the present case, the testimony of the appellant does not require any rebuttal by his wife, because, according to the clear provisions of law, the latter can not testify against her husband appellant, and the courts should take into consideration in determining the probative force of such a testimony. And it does not call for a denial by the wife in herself or own defense, because it can not be used or admitted without her consent as evidence in a criminal case instituted against her for her son's death. Under the new theory of the majority, the prosecutor of one spouse who, in order to free himself from liability as defendant in a criminal case would testify, as the appellant has testified, that his other spouse who is not a party to the case is responsible for their child's death, may take advantage of such testimony to induce that other spouse to testify in her defense according to the prosecution, and the latter in so testifying would naturally accuse the defendant to be the guilty party in order to save himself or herself from criminal liability. Who may give the assurance that the defendant's wife in the present case did testify the way she she testified against her husband, not because her husband is really guilty, but because she wanted to defend and save herself, taking into consideration the way the question were propounded to her by the prosecution and her answers thereto? The prosecution asked her: "The accused testified here that you were the one who inflicted the wound at the back of Romeo Francisco, is that right?" and she answered: "No sir he was the one who inflicted the wound to my son Romeo Francisco." "P. Did you see him inflict the wound to the child? R. Yes sir." (P. 23, st. notes.) Who may dispel from the mind the doubt that the prosecution in the court below, believing erroneously, but in good faith, that the testimony of the appellant in his defense is admissible against and tended to make his wife criminally responsible, imparted such wrong belief to and induced her thereby to testify imputing the commission of the crime to her husband although he is not guilty, just to save herself. It is plain that if the wife testified against her husband, it was because the fiscal erroneously assumed in his interrogatory above quoted that the appellant later imputed to her the crime charged, for the testimony of the appellant quoted below clearly belies the fiscal's assumption: P. Please tell the Court what happened when you sat beside your wife? Sr. Fiscal: Objection, no basis. Court: He may answer.

R. When I sat beside my wife and our son was lying face downward on the bed I was joking my wife because at the time I was drunk. P. What was the relative position of your son with respect to you and your wife? R. I am going to demonstrate our relative positions, (the accused was facing his wife and the wife was facing in the opposite direction and the son was between them lying face downward and little bit behind on the bed). I used to touch her, so she swung her hand backward towards me, then I stood up and evaded the blow. Later on I heard the boy cried. P. What hand did your wife swing, left or right hand?-- R. Her right hand. P. Is this the very scissors when she swung her arm? R. Yes, sir. P. After she swung her arm what happened? R. The child cried.

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P. Then what happened? R. When I stood up our child was already wounded so I became obfuscated. P. Then what happened? R. I got hold of the scissors that she was holding and stabbed her and then stabbed myself." Besides, it is to be borne in mind that the capacity or incapacity of one of the spouses to testify against the other is governed by the statute in force and the Court should construe the statute such as it is, and not as it should. It is for the law-making power to evolve new theories and enact law in accordance therewith. The provisions of section 26 (c), Rule 123, were copied from those of section 383 (3) of Act No. 190, as amended, and the latter were in turn taken from similar provisions of law in force in the States of the Union, which are based on the common-law. Under the common-law, husband and wife are absolutely incompetent against each other except in a civil case instituted by one against the other, or in a criminal case for a crime committed by one against the other; and the consent of a spouse can not render the other spouse competent. But in many states, statutes were enacted granting exceptions upon the common-law rule and enabling one of them to testify against the other with the consent of the latter in civil case, or the consent of the other or both in criminal cases. Under such statute, one spouse who calls the other as a witness thereby consents that the latter shall testify; and if the adverse party offers one of the spouses against the other and the latter does not object, then he or she is presumed to have consented to it. In the case of Toskstein vs. Birmmerle (150 Mo., 491; 131 S.W., 126), it was held that incompetency of a wife continues as at common-law where she is not rendered competent under the provision of the enabling statute. In the case of Conley vs. State (176 Ark., 654; 3 S.W. [2d], 980), the Supreme Court of Arkansas ruled that statutes providing that no person shall be excluded from testifying in prosecution for violation of Liquor Act do not change the general rule that a wife cannot testify against her husband in a criminal prosecution. And in another case entitled Connecticut Fire Ins. Co. vs. Chester P. & Ste. G.R. Co. (171 Mo. App., 70; 153 S.W., 544), it was held that unless wife comes within exceptions of the enabling statute granting exceptions upon the common-law rule excluding her testimony in an action in which her husband is interested, the wife can not testify. Therefore, inasmuch as our statute on the matter, or section 26 (d), Rule 123, provides that a wife cannot be examined for or against her husband without his consent except in a criminal case for crime committed by one against the other, and the appellant in the present case objected strenuously to the testimony of her wife against him, her testimony is inadmissible and can not be taken into consideration in the decision of the case. We can not, by any process of reasoning or stretch of imagination, construe said provision so as to capacitate a wife to be a witness against her husband if the latter, in testifying in his own defense, says that his wife was the one who accidentally inflicted the fatal wound on their small child. We can not evolve a new theory, however reasonable and plausible it may be, and apply for the first time as if it were the law in the present case against the appellant. It may be a good theory or a sufficient reason for amending the law in order to include it as one of the exceptions of the rule incapacitating one spouse to testify against the other; but we can not legally apply it as a law now against the appellant, a defendant in a criminal case. But the majority, not being sure of its stand on the admissibility of the testimony of the wife against her husband, further states: At any rate, in the instant case the wife did not testify in the direct evidence for the prosecution but under circumstances presently to be stated. It will be noted that the wife only testified against her husband after the latter, testifying in his own defense imputed upon her the killing of their little son. (P. 15, ibid.) By all rules of justice and reason this gave the prosecution, which had theretofore refrained from presenting the wife as a witness against her husband, the right to do so, as it did in rebuttal; and to the wife herself the right to so testify, at least, in self-defense,. . .. (P. 704, ante.) To this we may reply that, in the first place, the testimony of the wife to the effect that her husband was the one who inflicted and she saw him inflict the wound on Romeo Francisco that caused the death of the latter (pp. 23, 24, st. notes), is not a rebutting but a new additional evidence bearing upon the main issue whether or not the defendant is guilty of the offense charged. For according to section 3 (c), Rule 115, the prosecution may, after the defendant has presented evidence in support of his defense, "offer rebutting testimony, but rebutting only, unless the court in furtherance of justice, permit them to offer new additional evidence bearing upon the main issue in question." Her testimony would have been in rebuttal only if she had limited herself to say that she did not inflict the wound on her son. And in the second place, to make the testimony of the wife admissible in rebuttal against the appellant, would be to amend the provision of said section 26 (d) of Rule 123 and establish another exception, that has never been adopted by the statutes anywhere in the States of the Union and in this jurisdiction. And not being sure as to the scope of a rebuttal testimony, the majority opinion adds the following: When the husband testified that it was his wife who caused the death of their son, he could not, let us repeat, justly expect the State to keep silent and refrain from rebutting such new matter in his testimony, through the only witness available, namely, the wife; nor could he legitimately seal his wife's lips and thus gravely expose her to the danger of criminal proceedings against her being started by the authorities upon the strength and basis of said testimony of her husband, or to bear the moral and social stigma of being thought, believed, or even just suspected, to be the killer of her own offspring. . . . And if the wife should, in such a case and at such a juncture, be allowed to testify upon rebuttal, the scope of her testimony should at least be the same as that of her husband. This is only simple justice and fairness dictated by common sense. Since the husband had testified that it was his wife who caused the death of the little boy, she should be allowed to say that it was really her husband who did it. . . . At any rate, the trial court not only had the power to allow the State to utilize the wife as rebuttal witness, but also the discretion to permit "new additional evidence bearing upon the main issue in question." But even restricting the wife's testimony to merely contradicting her husband's version that she was the one who killed their child, there is evidence beyond reasonable doubt that appellant was the killer. It is elemental that the scope of a rebuttal is circumscribed to contradicting or destroying the evidence of the adverse party tending to prove new matter in favor of the latter, and can not extend to disproving directly the main issue in question, that is, the guilt of the appellant in the present case. Evidently, the testimony of the husband that his wife was the one who unintentionally inflicted the wound which caused the death of their child, can not gravely expose her to the danger of criminal proceeding against her," and "to bear the moral and social stigma of being thought, believed, or even just suspected to be the killer of her own offspring;" because said testimony is not admissible against his wife in that or in any other cases, and everybody is presumed to know the law that incapacitates the wife to testify against her accused husband and contradict what the latter may testify against her however false it may be. The conclusion in the majority decision that, if not in rebuttal, the court had discretion to permit the prosecution to present the testimony of the wife, as additional evidence bearing upon the main issue in question, is absolutely untenable, since we have already shown that such a testimony is inadmissible as evidence, and this court has already decided in the case of People vs. Natividad (above cited), squarely applicable to the present case, that "a wife can not testify against her husband in a criminal case in which the latter was charged with having killed the child of the former." The matter under discussion is the incompetency of the wife to testify, directly or in rebuttal, in the present case against her husband, and not the guilt or innocence of the appellant. Hence the last statement in the above quoted decision of the majority that "even restricting the wife's testimony as merely contradicting the husband's version that she was the one who killed their child, there is other evidence beyond reasonable doubt that the appellant is the killer," is out of place for it has no bearing on the issue. The conclusion of fact on which a sentence declaring a defendant guilty must be positive and not argumentative. And if the appellant is to be convicted on the strength of other evidence, aside from the testimony of the appellant's wife, the decision should express clearly and distinctly the facts and the law on which the decision convicting the appellant is based, as required by section 12, Article IX of the Constitution.

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The majority's conclusion that the testimony of the appellant to the effect that the cause of the death of their child was the wound unintentionally inflicted by his wife, constituted a waiver of all objection to her testimony, is without any foundation in fact and in law; because the defendant had strongly and persistently objected to his wife taking the witness stand (st. t.s.n., p. 23), and no law, court or authority, from time immemorial up to the present, has ever recognized such testimony as a waiver. The only cases in which the incapacity of one of the spouses to testify against the other is considered waived according to law, are those stated in section 1205, of Wharton on Criminal Evidence, Vol. 3, 11th ed., quoted in the very opinion of the majority, which says the following: SEC. 1205. Waiver of incompetency. Objections to the competency of a husband or wife to testify in a criminal prosecution against the other may be waived as in the case of other witnesses generally. Thus, the accused waives his or her privilege by calling the other spouse as a witness for him or her, thereby making the spouse subject to cross-examination in the usual manner. It is well-established that where an accused introduces his wife as a witness in his behalf, the state is entitled to question her as to all matters germane and pertinent to her testimony on direct examination. It is also true that objection to the spouse's competency must be made when he or she is first offered as a witness, and that the incompetency may be waived by the failure of the accused to make timely objection to the admission of the spouse's testimony, although knowing of such incompetency, and the testimony admitted, especially if the accused has assented to the admission, either expressly or impliedly. But the decision, after quoting subsequently section 1149 of the same work, which refers to waiver of objection to competency of a witness in general, concludes by saying "It will be noted, as was to be expected, that in the last-quoted section, the author mentions certain specific cases where the courts concerned hold that there was waiver, but for obvious reasons neither the author nor the said courts have attempted to make an enumeration of all possible cases of waiver. In the very nature of things, it would be impossible to make a priori such a complete enumeration and to say that it is exclusive." The last-quoted section in the decision reads in its pertinent part as follows: SEC. 1149. Waiver of objection to incompetency. A party may waive his objection to the competency of a witness and permit him to testify. A party calling an incompetent witness as his own waives the incompetency. Also, if, after such incompetency appears, there is a failure to make timely objection, by a party having knowledge of the incompetency, the objection will be deemed waived, whether it on the ground of want of mental capacity or for some other reason. . . . The cases of waiver specified by Wharton in sections 1149 and 1205 of his work on criminal evidence above-quoted, are the only cases of waiver of the objection to the competency of one spouse to testify against the other, as well as of the objection to the competency of any other witness to testify. Not only Wharton but all works on criminal evidence enumerate only those cases, because there are no other cases provided for by the statutes or declared by the courts in their decisions. Authors or writers on evidence do not generally evolve and formulate new legal theories but only expound those based on positive laws as the latter have been interpreted and construed up-to-date by the courts. It is to be presumed that during several centuries in which the rule excluding the testimony of one spouse in a case in which the other is interested has been in force, a case similar to the present must have been arisen, and it would be too presumptuous to assume that this Court is the first to find correctly that the case is one of the exceptions upon said rule. For the majority can not point out a single decision in support of the exception which the majority intends to establish now for the first time. The above-mentioned cases of the objection to the competency of one of the spouses to testify against the other are the only ones, and no writers on evidence nor courts did or could enumerate or recognize other cases, since no legislative or law making power had so provided; because what is called waiver is merely or nothing more than the consent of one spouse that the other testify in a case in which he or she is interested or a party, consent provided for as exception by law. As the consent may be either express or implied: express when the spouse who is a party presents the other spouse to testify, and implied when the adverse party or the prosecution presents the other spouse as a witness, and the spouse against whom the other is to testify does not object; so the waiver may also be expressed and implied. And, therefore, just as there can not be any other way of giving such consent than those above-stated, so there is no other case of waiver under the laws now in force. Therefore, this Court must, in the interest of justice, reject the testimony of the defendant's wife, admitted as rebuttal evidence over the objection of the appellant, and considered by the majority as corroborative of the defendant's extrajudicial confession Exhibit C, and decide whether this confession alone is sufficient to support the appellant's conviction. G.R. No. 143439 October 14, 2005 MAXIMO ALVAREZ, Petitioner, vs. SUSAN RAMIREZ, Respondent. SANDOVAL-GUTIERREZ, J.: Before us is a petition for review on certiorari1 assailing the Decision2 of the Court of Appeals dated May 31, 2000 in CA-G.R. SP No. 56154, entitled "Susan Ramirez, petitioner, versus, Hon. Benjamin M. Aquino, Jr., as Judge RTC, Malabon, MM, Br. 72, and Maximo Alvarez, respondents." Susan Ramirez, herein respondent, is the complaining witness in Criminal Case No. 19933-MN for arson3 pending before the Regional Trial Court, Branch 72, Malabon City. The accused is Maximo Alvarez, herein petitioner. He is the husband of Esperanza G. Alvarez, sister of respondent. On June 21, 1999, the private prosecutor called Esperanza Alvarez to the witness stand as the first witness against petitioner, her husband. Petitioner and his counsel raised no objection. Esperanza testified as follows: "ATTY. ALCANTARA: We are calling Mrs. Esperanza Alvarez, the wife of the accused, Your Honor. COURT: Swear in the witness. xxx ATTY. MESIAH: (sic) Your Honor, we are offering the testimony of this witness for the purpose of proving that the accused Maximo Alvarez committed all the elements of the crime being charged particularly that accused Maximo Alvarez pour on May 29, 1998 gasoline in the house located at Blk. 5, Lot 9, Phase 1-C, Dagat-dagatan, Navotas, Metro Manila, the house owned by his sister-in-law Susan Ramirez; that accused Maximo Alvarez after pouring the gasoline on the door of the house of Susan Ramirez ignited and set it on fire; that the accused at the time he successfully set the house on fire (sic) of Susan Ramirez knew that it was occupied by Susan Ramirez, the members of the family as well as Esperanza Alvarez, the estranged wife of the accused; that as a consequence of the accused in successfully setting the fire to the house of Susan Ramirez, the door of said house was burned and together with several articles of the house, including shoes, chairs and others.

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COURT: You may proceed. xxx DIRECT EXAMINATION ATTY. ALCANTARA: xxx Q: When you were able to find the source, incidentally what was the source of that scent? A: When I stand by the window, sir, I saw a man pouring the gasoline in the house of my sister (and witness pointing to the person of the accused inside the court room). Q: For the record, Mrs. Witness, can you state the name of that person, if you know? A: He is my husband, sir, Maximo Alvarez. Q: If that Maximo Alvarez you were able to see, can you identify him? A: Yes, sir. Q: If you can see him inside the Court room, can you please point him? A: Witness pointing to a person and when asked to stand and asked his name, he gave his name as Maximo Alvarez."4 In the course of Esperanzas direct testimony against petitioner, the latter showed "uncontrolled emotions," prompting the tr ial judge to suspend the proceedings. On June 30, 1999, petitioner, through counsel, filed a motion5 to disqualify Esperanza from testifying against him pursuant to Rule 130 of the Revised Rules of Court on marital disqualification. Respondent filed an opposition6 to the motion. Pending resolution of the motion, the trial court directed the prosecution to proceed with the presentation of the other witnesses. On September 2, 1999, the trial court issued the questioned Order disqualifying Esperanza Alvarez from further testifying and deleting her testimony from the records.7 The prosecution filed a motion for reconsideration but was denied in the other assailed Order dated October 19, 1999.8 This prompted respondent Susan Ramirez, the complaining witness in Criminal Case No. 19933-MN, to file with the Court of Appeals a petition for certiorari9 with application for preliminary injunction and temporary restraining order.10 On May 31, 2000, the Appellate Court rendered a Decision nullifying and setting aside the assailed Orders issued by the trial court. Hence, this petition for review on certiorari. The issue for our resolution is whether Esperanza Alvarez can testify against her husband in Criminal Case No. 19933-MN. Section 22, Rule 130 of the Revised Rules of Court provides: "Sec. 22. Disqualification by reason of marriage. During their marriage, neither the husband nor the wife may testify for or against the other without the consent of the affected spouse, except in a civil case by one against the other, or in a criminal case for a crime committ ed by one against the other or the latters direct descendants or ascendants." The reasons given for the rule are: 1. There is identity of interests between husband and wife; 2. If one were to testify for or against the other, there is consequent danger of perjury; 3. The policy of the law is to guard the security and confidences of private life, even at the risk of an occasional failure of justice, and to prevent domestic disunion and unhappiness; and 4. Where there is want of domestic tranquility there is danger of punishing one spouse through the hostile testimony of the other.11 But like all other general rules, the marital disqualification rule has its own exceptions, both in civil actions between the spouses and in criminal cases for offenses committed by one against the other. Like the rule itself, the exceptions are backed by sound reasons which, in the excepted cases, outweigh those in support of the general rule. For instance, where the marital and domestic relations are so strained that there is no more harmony to be preserved nor peace and tranquility which may be disturbed, the reason based upon such harmony and tranquility fails. In such a case, identity of interests disappears and the consequent danger of perjury based on that identity is non-existent. Likewise, in such a situation, the security and confidences of private life, which the law aims at protecting, will be nothing but ideals, which through their absence, merely leave a void in the unhappy home.12 In Ordoo vs. Daquigan,13 this Court held:

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"We think that the correct rule, which may be adopted in this jurisdiction, is that laid down in Cargil vs. State, 35 ALR 133, 220 Pac. 64, 25 Okl. 314, wherein the court said: The rule that the injury must amount to a physical wrong u pon the person is too narrow; and the rule that any offense remotely or indirectly affecting domestic harmony comes within the exception is too broad. The better rule is that, when an offense directly attacks, or directly and vitally impairs, the conjugal relation, it comes within the exception to the statute that one shall not be a witness against the other except in a criminal prosecution for a crime committee (by) one against the other." Obviously, the offense of arson attributed to petitioner, directly impairs the conjugal relation between him and his wife Esperanza. His act, as embodied in the Information for arson filed against him, eradicates all the major aspects of marital life such as trust, confidence, respect and love by which virtues the conjugal relationship survives and flourishes. As correctly observed by the Court of Appeals: "The act of private respondent in setting fire to the house of his sister-in-law Susan Ramirez, knowing fully well that his wife was there, and in fact with the alleged intent of injuring the latter, is an act totally alien to the harmony and confidences of marital relation which the disqualification primarily seeks to protect. The criminal act complained of had the effect of directly and vitally impairing the conjugal relation. It underscored the fact that the marital and domestic relations between her and the accused-husband have become so strained that there is no more harmony, peace or tranquility to be preserved. The Supreme Court has held that in such a case, identity is non-existent. In such a situation, the security and confidences of private life which the law aims to protect are nothing but ideals which through their absence, merely leave a void in the unhappy home. (People v. Castaeda, 271 SCRA 504). Thus, there is no longer any reason to apply the Marital Disqualification Rule." It should be stressed that as shown by the records, prior to the commission of the offense, the relationship between petitioner and his wife was already strained. In fact, they were separated de facto almost six months before the incident. Indeed, the evidence and facts presented reveal that the preservation of the marriage between petitioner and Esperanza is no longer an interest the State aims to protect. At this point, it bears emphasis that the State, being interested in laying the truth before the courts so that the guilty may be punished and the innocent exonerated, must have the right to offer the direct testimony of Esperanza, even against the objection of the accused, because (as stated by this Court in Francisco14), "it was the latter himself who gave rise to its necessity." WHEREFORE, the Decision of the Court of Appeals is AFFIRMED. The trial court, RTC, Branch 72, Malabon City, is ordered to allow Esperanza Alvarez to testify against petitioner, her husband, in Criminal Case No. 19933-MN. Costs against petitioner. SO ORDERED. G.R. No. L-13109 March 6, 1918 THE UNITED STATES, plaintiff-appellee, vs. DALMACEO ANTIPOLO, defendant-appellant. FISHER, J.: The appellant was prosecuted in the Court of First Instance of the Province of Batangas, charged with the murder of one Fortunato Dinal. The trial court convicted him of homicide and from that decision he was appealed. One of the errors assigned is based upon the refusal of the trial judge to permit Susana Ezpeleta, the widow of the man whom the appellant is accused of having murdered, to testify as a witness on behalf of the defense concerning certain alleged dying declarations. The witness was called to the stand and having stated that she is the widow of Fortunato Dinal was asked: On what occasion did your husband die? To th is question the fiscal objected upon the following ground: I object to the testimony of this witness. She has just testified that she is the widow of the deceased, Fortunato Dinal, and that being so I believe that she is not competent to testify under the rules and procedure in either civil or criminal cases, unless it be with the consent of her husband, and as he is dead and cannot grant that permission, it follows that this witness is disqualified from testifying in this case in which her husband is the injured party. Counsel for defendant insisted that the witness was competent, arguing that the disqualification which the fiscal evidently had in mind relates only to cases in which a husband or wife of one of the parties to a proceeding is called to testify; that the parties to the prosecution of a criminal case are the Government and the accused; that, furthermore the marriage of Dinal to the witness having been dissolved by the death of her husband, she is no longer his wife, and therefore not subject to any disqualification arising from the status of marriage. These propositions were rejected by the trial judge, and the objection of the fiscal as to the testimony of the woman Ezpeleta was sustained. To this objection counsel took exception and made an offer to prove by the excluded witness the facts which he expected to establish by her testimony. Concerning these facts it is sufficient at this time to say that some of them would be both material and relevant, to such a degree that if proven to the satisfaction of the court, they might have lead to the acquittal of the accused, as they purported to relate to the dying declarations of the deceased, concerning the cause of his death, the general purport being that his injuries were due to fall and not to the acts imputed to the accused. Section 58 of General Orders No. 58 (1900) reads as follows: Except with the consent of both, or except in cases of crime committed by one against the other, neither husband nor wife shall be a competent witness for or against the other in a criminal action or proceeding to which one or both shall be parties. The reasons for this rule are thus stated in Underhills work on Criminal Evidence (second edition) on page 346: At common law, neither a husband nor a wife was a competent witness for or against the other in any judicial proceedings, civil or criminal, to which the other was a party. . . . If either were recognized as a competent witness against the other who was accused of crime, . . . a very serious injury would be done to the harmony and happiness of husband and wife and the confidence which should exist between them. In Greenleafs classical work on evidence, in section 337 [vol. I], the author says, in stating the reasons for the rule at c ommon law: The great object of the rule is to secure domestic happiness by placing the protecting seal of the law upon all confidential communications between husband and wife; and whatever has come to the knowledge of either by means of the hallowed confidence which that relation inspires, cannot be afterwards divulged in testimony even though the other party be no longer living. This case does not fall with the text of the statute or the reason upon which it is based. The purpose of section 58 is to protect accused persons against statements made in the confidence engendered by the marital relation, and to relieve the husband or wife to whom such confidential communications might have been made from the obligation of revealing them to the prejudice of the other spouse. Obviously, when a person at the point of death as a result of injuries he has suffered makes a statement regarding the manner in which he received those injuries, the communication so made is in no sense confidential. On the contrary, such a communication is made for the express purpose that it may be communicated after the death of the declarant to the authorities concerned in inquiring into the cause of his death.

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The same theory as that upon which section 58 of General Orders No. 58 is based, underlies section 383, paragraph 3 of Act No. 190, which reads as follows: A husband cannot be examined for or against his wife without her consent; nor a wife for or against her husband without his consent; nor can either, during the marriage or afterwards, be, without the consent of the other, examined as to any communication made by one to the other during the marriage; but this exception does not apply to a civil action or proceeding by one against the other, or to a criminal action or proceeding for a crime committed by one against the other. The only doubt which can arise from a reading of this provision relates to the meaning of the words during the marriage or afterwards, and this doubt can arise only by a consideration of this phrase separately from the rest of the paragraph. Construed as a whole it is evident that it relates only to cases in which the testimony of a spouse is offered for or against the other in a proceeding to which the other is a party. The use of the word afterwards in the phrase during the marriage or afterwards was intended to cover cases in which a marriage has been dissolved otherwise than by death of one of the spouses as, for instance, by decree of annulment or divorce. The declarations of a deceased person while in anticipation of certain impending death, concerning the circumstances leading up to the death, are admissible in a prosecution of the person charged with killing the declarant. (U. S. vs. Gil, 13 Phil., Rep., 530.) Such dying declarations are admissible in favor of the defendant as well as against him. (Mattox vs. U. S., 146 U. S., 140.) It has been expressly held in several jurisdictions in the United States that the widow of the deceased may testify regarding his dying declarations. In the case of the State vs. Ryan (30 La. Ann., 1176), cited by appellant in his brief, the court said: The next bill is as to the competency of the widow of the deceased to prove his dying declarations. We see no possible reason for excluding her . . . after the husbands death she is no longer his wife, and the rules of evidence, as between husbands and wives, are no longer applicable. In the case of Arnett vs. Commonwealth (114 Ky., 593, 596), the testimony of the widow of the deceased as to his dying declarations made to her was objected to upon the express ground that under the terms of the Kentucky Code, the wife was incompetent to testify even after the cessation of the marria ge relation, to any communication made by her by her husband during the marriage. This contention was rejected, the court saying: On grounds of public policy the wife can not testify against her husband as to what came to her from him confidentially or by reason of the marriage relation, but this rule does not apply to a dying communication made by the husband to the wife on the trial of the one who killed him. The declaration of the deceased made in extremes in such cases is a thing to be proven, and this proof may be made by any competent witness who heard the statement. The wife may testify for the state in cases of this character as to any other fact known to her. . . . It can not be contended that the dying declaration testified to by the witness was a confidential communication made to her; on the contrary, it was evidently made in the furtherance of justice for the express purpose that it should be testified to in the prosecution of the defendant. We are therefore of the opinion that the court below erred in excluding the testimony of the witness Susana Ezpeleta, and that by reason of such exclusion, the accused was deprived of one of his essential rights. That being the case, a new trial must be granted. For the reason stated, the judgment of the court below is hereby set aside and a new trial is granted at which the testimony of the witness Susana Ezpeleta will be admitted, together with any additional evidence which may be offered on the part of the prosecution or the defense. At the new trial granted the accused, the testimony taken at the former hearing shall be considered. The costs of this appeal shall be de officio. So ordered. G.R. No. L-22948 March 17, 1925 THE PEOPLE OF THE PHILIPPINE ISLANDS, plaintiff-appellee, vs. FAUSTO V. CARLOS, defendant-appellant. OSTRAND, J.: This is an appeal from a decision of the Court of First Instance of the City of Manila finding the defendant Fausto V. Carlos guilty of the crime of murder and sentencing him to suffer life imprisonment, with the accessory penalties prescribed by law and with the costs. It appears from the evidence that the victim of the alleged murder, Dr. Pablo G. Sityar, on March 3, 1924, in Mary Chiles Hospital, performed a surgical operation upon the defendant's wife for appendicitis and certain other ailments. She remained in the hospital until the 18th of the same month, but after her release therefrom she was required to go several times to the clinic of Doctor Sityar at No. 40 Escolta, for the purpose of dressing the wounds caused by the operation. On these occasions she was accompanied by her husband, the defendant. The defendant states that on one of the visits, that of March 20, 1924, Doctor Sityar sent him out on an errand to buy some medicine, and that while defendant was absent on this errand Doctor Sityar outraged the wife. The defendant further states that his wife informed him of the outrage shortly after leaving the clinic. Notwithstanding this it nevertheless appears that he again went there on March 28th to consult the deceased about some lung trouble from which he, the defendant, was suffering.. He was given some medical treatment and appears to have made at least one more visit to the clinic without revealing any special resentment. On May 12, 1924, the defendant, suffering from some stomach trouble, entered the Philippine General Hospital where he remained until May 18, 1924, and where he was under the care of two other physicians. While in the hospital her received a letter (Exhibit 5) from Doctor Sityar asking the immediate settlement of the account for the professional services rendered his wife. Shortly after his release from the hospital the defendant sought an interview with Doctor Sityar and went to the latter's office several times without finding him in. On one of these occasions he was asked by an employee of the office, the nurse Cabaera, if he had come to settle his account, to which the defendant answered that he did not believe he owed the doctor anything. In the afternoon of May 26th the defendant again went to the office of the deceased and found him there alone. According to the evidence of the prosecution, the defendant then, without any preliminary quarrel between the two, attacked the deceased with a fan-knife and stabbed him twice. The deceased made an effort to escape but the defendant pursued him and overtaking him in the hall outside the office, inflicted another wound upon him and as a consequence if the three wounds he died within a few minutes. The defendants made his escape but surrendered himself to the Constabulary at Malolos, Bulacan, in the evening of the following day. The defendant admits that he killed the deceased but maintains that he did so in self-defense. He explains that he went to Doctor Sityar's office to protest against the amount of the fee charged by the doctor and, in any event, to ask for an extension of the time of payment; that during the conversation upon that subject the deceased insulted him by telling him that inasmuch as he could not pay the amount demanded he could send his wife to the office as she was the one treated, and that she could then talk the matter over with the decease; that this statement was made in such an insolent and contemptuous manner that the defendant became greatly incensed and remembering the outrage committed upon his wife, he assumed a threatening attitude and challenged the deceased to go downstairs with him and there settle the matter; that the deceased thereupon took a pocket-knife from the center drawer of his desk and attacked the defendant, endeavoring to force him out of the office; that the defendant, making use of his knowledge of fencing, succeeded in taking the knife away from the deceased and blinded by fury stabbed him first in the right side of the breast and then in the epigastric region, and fearing that the deceased might secure some other weapon or receive assistance from the people in the adjoining room, he again stabbed him, this time in the back.

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The defendant's testimony as to the struggle described is in conflict with the evidence presented by the prosecution. But assuming that it is true, it is very evident that it fails to establish a case of self-defense and that, in reality, the only question here to be determined is whether the defendant is guilty of murder or of simple homicide. The court below found that the crime was committed with premeditation and therefore constituted murder. This finding can only be sustained by taking into consideration Exhibit L, a letter written to the defendant by his wife and siezed by the police in searching his effects on the day of his arrest. It is dated May 25, 1924, two days before the commission of the crime and shows that the writer feared that the defendant contemplated resorting to physical violence in dealing with the deceased. Counsel for the defendant argues vigorously that the letter was a privileged communication and therefore not admissible in evidence. The numerical weight of authority is, however, to the effect that where a privileged communication from one spouse to another comes into the hands of a third party, whether legally or not, without collusion and voluntary disclosure on the part of either of the spouses, the privilege is thereby extinguished and the communication, if otherwise competent, becomes admissible. (28 R.C.L., 530 and authorities there cited.) Such is the view of the majority of this court. Professor Wigmore states the rule as follows: For documents of communication coming into the possession of a third person, a distinction should obtain, analogous to that already indicated for a client's communications (ante, par. 2325, 2326); i. e., if they were obtained from the addressee by voluntary delivery, they should still be privileged (for otherwise the privilege could by collusion be practically nullified for written communications); but if they were obtained surreptitiously or otherwise without the addressee's consent, the privilege should cease. (5 Wigmore on Evidence, 2nd ed., par. 2339.) The letter in question was obtained through a search for which no warrant appears to have been issued and counsel for the defendant cites the causes of Boyd and Boyd vs. United States (116 U.S., 616) and Silverthorne Lumber Co. and Silverthorne vs. United States (251 U.S., 385) as authority for the proposition that documents obtained by illegal searches of the defendant's effects are not admissible in evidence in a criminal case. In discussing this point we can do not better than to quote Professor Wigmore: The foregoing doctrine (i. e., that the admissibility of evidence is not affected by the illegality of the means through which the party has been enabled to obtain the evidence) was never doubted until the appearance of the ill-starred majority opinion of Boyd vs. United States, in 1885, which has exercised unhealthy influence upon subsequent judicial opinion in many States. xxx xxx xxx

The progress of this doctrine of Boyd vs. United States was as follows: (a) The Boyd Case remained unquestioned in its own Court for twenty years; meantime receiving frequent disfavor in the State Courts (ante, par. 2183). (b) Then in Adams vs. New York, in 1904, it was virtually repudiated in the Federal Supreme Court, and the orthodox precedents recorded in the State courts (ante, par. 2183) were expressly approved. (c) Next, after another twenty years, in 1914 moved this time, not by erroneous history, but by misplaced sentimentality the Federal Supreme Court, in Weeks vs. United States, reverted to the original doctrine of the Boyd Case, but with a condition, viz., that the illegality of the search and seizure should first have been directly litigated and established by a motion, made before trial, for the return of the things seized; so that, after such a motion, and then only, the illegality would be noticed in the main trial and the evidence thus obtained would be excluded. ... (4 Wigmore on Evidence, 2nd ed., par. 2184.) In the Silverthorne Lumber Co. case the United States Supreme Court adhered to its decision in the Weeks Case. The doctrine laid down in these cases has been followed by some of the State courts but has been severely criticized and does not appear to have been generally accepted. But assuming, without deciding, that it prevails in this jurisdiction it is, nevertheless, under the decisions in the Weeks and Silverthorne cases, inapplicable to the present case. Here the illegality of the search and seizure was not "directly litigated and established by a motion, made before trial, for the return of the things seized." The letter Exhibit L must, however, be excluded for reasons not discussed in the briefs. The letter was written by the wife of the defendant and if she had testified at the trial the letter might have been admissible to impeach her testimony, but she was not put on the witness-stand and the letter was therefore not offered for that purpose. If the defendant either by answer or otherwise had indicated his assent to the statements contained in the letter it might also have been admissible, but such is not the case here; the fact that he had the letter in his possession is no indication of acquiescence or assent on his part. The letter is therefore nothing but pure hearsay and its admission in evidence violates the constitutional right of the defendant in a criminal case to be confronted with the witnesses for the prosecution and have the opportunity to cross-examine them. In this respect there can be no difference between an ordinary communication and one originally privileged. The question is radically different from that of the admissibility of testimony of a third party as to a conversation between a husband and wife overheard by the witness. Testimony of that character is admissible on the ground that it relates to a conversation in which both spouses took part and on the further ground that where the defendant has the opportunity to answer a statement made to him by his spouse and fails to do so, his silence implies assent. That cannot apply where the statement is contained in an unanswered letter. The Attorney-General in support of the contrary view quotes Wigmore, as follows: . . . Express communication is always a proper mode of evidencing knowledge or belief. Communication to a husband or wife is always receivable to show probable knowledge by the other (except where they are living apart or are not in good terms), because, while it is not certain that the one will tell the other, and while the probability is less upon some subjects than upon others, still there is always some probability, which is all that can be fairly asked for admissibility. ... (1 Wigmore, id., par. 261.) This may possibly be good law, though Wigmore cites no authority in support of his assertion, but as far as we can see it has little or nothing to do with the present case. As we have already intimated, if Exhibit L is excluded, there is in our opinion not sufficient evidence in the record to show that the crime was premeditated. The prosecution maintains that the crime was committed with alevosia. This contention is based principally on the fact that one of the wounds received by the deceased showed a downward direction indicating that the deceased was sitting down when the wound was inflicted. We do not think this fact is sufficient proof. The direction of the wound would depend largely upon the manner in which the knife was held. For the reasons stated we find the defendant guilty of simple homicide, without aggravating or extenuating circumstances. The sentence appealed from is therefore modified by reducing the penalty to fourteen years, eight months and one day of reclusion temporal, with the corresponding accessory penalties and with the costs against the appellant. So ordered. Separate Opinions

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VILLAMOR, J., dissenting: His Honor, the judge who tried this case, inserts in his decision the testimony of the witness Lucio Javillonar as follows: The witness, Lucio Javillonar, testified that he went to the office of the deceased some minutes before six o'clock in that evening in order to take him, as had previously been agreed upon between them, so that they might retire together to Pasig, Rizal, where they resided then; that having noticed that the deceased was busy in his office, talking with a man about accounts, instead of entering, he stayed at the waiting room, walking from one end to another, while waiting for that man to go out; that in view of the pitch of the voice in which the conversation was held between the deceased and his visitor, and what he had heard, though little as it was, of said conversation, he believes that there was not, nor could there have been, any change of hard words, dispute or discussion of any kind; that shortly thereafter, he saw the screen of the door of the deceased's office suddenly open, and the deceased rush out stained with blood, and followed closely by the accused who then brandished a steel arm in the right hand; that upon seeing the deceased and overtaking him, leaning upon one of the screens of the door of a tailor shop a few feet from his office, slightly inclined to the right, with the arms lowered and about to fall to the floor, the accused stabbed him on the right side of the chest, thereby inflicting a wound on the right nipple; and that then the accused descended the staircase to escape away, at the same time that the deceased was falling to the ground and was being taken by him with the assistance of other persons from said place to a lancape (a sofa) where he died a few minutes later, unable to say a word. In deciding the question as to whether the act committed is murder, with the qualifying circumstance of treachery, as claimed by the Attorney-General, the trial judge says that the principal ground of the prosecution for holding that the commission of the crime was attended by the qualifying circumstance of treachery is a mere inference from the testimony of Lucio Javillonar, and that the nature of the wounds found on the epigastric region of the deceased and his back do not mean anything, because they could have been inflicted while the deceased was standing, seated or inclined. A careful consideration of the testimony of Lucio Javillonar, as set out in the judgment appealed from, will show that, according to said eyewitness, the deceased was with his arms lowered and about to fall to the floor when the accused stabbed him on the right side of the chest with the weapon he was carrying, thereby inflicting a wound on the right nipple, and that, according to the doctor who examined the wounds, anyone of them could have caused the death of the deceased. These being the facts proven, I am of opinion that application must be made here of the doctrine laid down by this court in the case of United States vs. Baluyot (40 Phil., 385), wherein it was held that "Even though a deadly attack may be begun under conditions not exhibiting the feature of alevosia, yet if the assault is continued and the crime consummated with alevosia, such circumstance may be taken into consideration as a qualifying factor in the offense of murder." I admit that none of the witnesses who testified in this case has seen the beginning of the aggression; but it positively appears from the testimony of the said witness Lucio Javillonar that, notwithstanding that the deceased was already wounded and about to fall to the floor, he struck him with another mortal blow with the weapon he was carrying, which shows that the accused consummated the crime with treachery. For the foregoing, I am of opinion that the judgment appealed from must be affirmed, considering the act committed as murder, with the qualifying circumstance of treachery, and in this sense I dissent from the majority opinion. G.R. No. L-21237 March 22, 1924 JAMES D. BARTON, plaintiff-appellee, vs. LEYTE ASPHALT & MINERAL OIL CO., LTD., defendant-appellant. STREET, J.: This action was instituted in the Court of First Instance of the City of Manila by James D. Barton, to recover of the Leyte Asphalt & Mineral Oil Co., Ltd., as damages for breach of contract, the sum of $318,563.30, United States currency, and further to secure a judicial pronouncement to the effect that the plaintiff is entitled to an extension of the terms of the sales agencies specified in the contract Exhibit A. The defendant answered with a general denial, and the cause was heard upon the proof, both documentary and oral, after which the trial judge entered a judgment absolving the defendant corporation from four of the six causes of action set forth in the complaint and giving judgment for the plaintiff to recover of said defendant, upon the first and fourth causes of action, the sum of $202,500, United States currency, equivalent to $405,000, Philippine currency, with legal interest from June 2, 1921, and with costs. From this judgment the defendant company appealed. The plaintiff is a citizen of the United States, resident in the City of Manila, while the defendant is a corporation organized under the law of the Philippine Islands with its principal office in the City of Cebu, Province of Cebu, Philippine Islands. Said company appears to be the owner by a valuable deposit of bituminous limestone and other asphalt products, located on the Island of Leyte and known as the Lucio mine. On April 21, 1920, one William Anderson, as president and general manager of the defendant company, addressed a letter Exhibit B, to the plaintiff Barton, authorizing the latter to sell the products of the Lucio mine in the Commonwealth of Australia and New Zealand upon a scale of prices indicated in said letter. In the third cause of action stated in the complaint the plaintiff alleges that during the life of the agency indicated in Exhibit B, he rendered services to the defendant company in the way of advertising and demonstrating the products of the defendant and expended large sums of money in visiting various parts of the world for the purpose of carrying on said advertising and demonstrations, in shipping to various parts of the world samples of the products of the defendant, and in otherwise carrying on advertising work. For these services and expenditures the plaintiff sought, in said third cause of action, to recover the sum of $16,563.80, United States currency. The court, however, absolved the defendant from all liability on this cause of action and the plaintiff did not appeal, with the result that we are not now concerned with this phase of the case. Besides, the authority contained in said Exhibit B was admittedly superseded by the authority expressed in a later letter, Exhibit A, dated October 1, 1920. This document bears the approval of the board of directors of the defendant company and was formally accepted by the plaintiff. As it supplies the principal basis of the action, it will be quoted in its entirety. (Exhibit A) CEBU, CEBU, P. I. October 1, 1920. JAMES D. BARTON, Esq., Cebu Hotel City. DEAR SIR: You are hereby given the sole and exclusive sales agency for our bituminous limestone and other asphalt products of the Leyte Asphalt and Mineral Oil Company, Ltd., May first, 1922, in the following territory: Australia Saigon Java New Zealand India China Tasmania Sumatra Hongkong Siam and the Straits Settlements, also in the United States of America until May 1, 1921. As regard bituminous limestone mined from the Lucio property. No orders for less than one thousand (1,000) tons will be accepted except under special agreement with us. All orders for said products are to be billed to you as follows:

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Per ton In 1,000 ton lots ........................................... P15 In 2,000 ton lots ........................................... 14 In 5,000 ton lots ........................................... 12 In 10,000 ton lots .......................................... 10 with the understanding, however that, should the sales in the above territory equal or exceed ten thousand (10,000) tons in the year ending October 1, 1921, then in that event the price of all shipments made during the above period shall be ten pesos (P10) per ton, and any sum charged to any of your customers or buyers in the aforesaid territory in excess of ten pesos (P10) per ton, shall be rebated to you. Said rebate to be due and payable when the gross sales have equalled or exceeded ten thousand (10,000) tons in the twelve months period as hereinbefore described. Rebates on lesser sales to apply as per above price list. You are to have full authority to sell said product of the Lucio mine for any sum see fit in excess of the prices quoted above and such excess in price shall be your extra and additional profit and commission. Should we make any collection in excess of the prices quoted, we agree to remit same to your within ten (10) days of the date of such collections or payments. All contracts taken with municipal governments will be subject to inspector before shipping, by any authorized representative of such governments at whatever price may be contracted for by you and we agree to accept such contracts subject to draft attached to bill of lading in full payment of such shipment. It is understood that the purchasers of the products of the Lucio mine are to pay freight from the mine carriers to destination and are to be responsible for all freight, insurance and other charges, providing said shipment has been accepted by their inspectors. All contracts taken with responsible firms are to be under the same conditions as with municipal governments. All contracts will be subject to delays caused by the acts of God, over which the parties hereto have no control. It is understood and agreed that we agree to load all ships, steamers, boats or other carriers prompty and without delay and load not less than 1,000 tons each twentyfour hours after March 1, 1921, unless we so notify you specifically prior to that date we are prepared to load at that rate, and it is also stipulated that we shall not be required to ship orders of 5,000 tons except on 30 days notice and 10,000 tons except on 60 days notice. If your sales in the United States reach five thousand tons on or before May 1, 1921, you are to have sole rights for this territory also for one year additional and should your sales in the second year reach or exceed ten thousand tons you are to have the option to renew the agreement for this territory on the same terms for an additional two years. Should your sales equal exceed ten thousand (10,000) tons in the year ending October 1, 1921, or twenty thousand (20,000) tons by May 1, 1922, then this contract is to be continued automatically for an additional three years ending April 30, 1925, under the same terms and conditions as above stipulated. The products of the other mines can be sold by you in the aforesaid territories under the same terms and conditions as the products of the Lucio mine; scale of prices to be mutually agreed upon between us. LEYTE ASPHALT & MINERAL OIL CO., LTD. By (Sgd.) WM. ANDERSON President (Sgd.) W. C. A. PALMER Secretary Approved by Board of Directors, October 1, 1920. (Sgd.) WM. ANDERSON President Accepted. (Sgd.) JAMES D. BARTON Witness D. G. MCVEAN Upon careful perusal of the fourth paragraph from the end of this letter it is apparent that some negative word has been inadvertently omitted before "prepared," so that the full expression should be "unless we should notify you specifically prior to that date that we are unprepared to load at that rate," or "not prepared to load at that rate." Very soon after the aforesaid contract became effective, the plaintiff requested the defendant company to give him a similar selling agency for Japan. To this request the defendant company, through its president, Wm. Anderson, replied, under date of November 27, 1920, as follows: In re your request for Japanese agency, will say, that we are willing to give you, the same commission on all sales made by you in Japan, on the same basis as your Australian sales, but we do not feel like giving you a regular agency for Japan until you can make some large sized sales there, because some other people have given us assurances that they can handle our Japanese sales, therefore we have decided to leave this agency open for a time. Meanwhile the plaintiff had embarked for San Francisco and upon arriving at that port he entered into an agreement with Ludvigsen & McCurdy, of that city, whereby said firm was constituted a subagent and given the sole selling rights for the bituminous limestone products of the defendant company for the period of one year from November 11, 1920, on terms stated in the letter Exhibit K. The territory assigned to Ludvigsen & McCurdy included San Francisco and all territory in California north of said city. Upon an earlier voyage during the same year to Australia, the plaintiff had already made an agreement with Frank B. Smith, of Sydney, whereby the latter was to act as the plaintiff's sales agent for bituminous limestone mined at the defendant's quarry in Leyte, until February 12, 1921. Later the same agreement was extended for the period of one year from January 1, 1921. (Exhibit Q.) On February 5, 1921, Ludvigsen & McCurdy, of San Francisco, addressed a letter to the plaintiff, then in San Francisco, advising hi that he might enter an order for six thousand tons of bituminous limestone to be loaded at Leyte not later than May 5, 1921, upon terms stated in the letter Exhibit G. Upon this letter the plaintiff immediately indorsed his acceptance.

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The plaintiff then returned to Manila; and on March 2, 1921, Anderson wrote to him from Cebu, to the effect that the company was behind with construction and was not then able to handle big contracts. (Exhibit FF.) On March 12, Anderson was in Manila and the two had an interview in the Manila Hotel, in the course of which the plaintiff informed Anderson of the San Francisco order. Anderson thereupon said that, owing to lack of capital, adequate facilities had not been provided by the company for filling large orders and suggested that the plaintiff had better hold up in the matter of taking orders. The plaintiff expressed surprise at this and told Anderson that he had not only the San Francisco order (which he says he exhibited to Anderson) but other orders for large quantities of bituminous limestone to be shipped to Australia and Shanghai. In another interview on the same Anderson definitely informed the plaintiff that the contracts which be claimed to have procured would not be filled. Three days later the plaintiff addressed a letter (Exhibit Y) to the defendant company in Cebu, in which he notified the company to be prepared to ship five thousand tons of bituminous limestone to John Chapman Co., San Francisco, loading to commence on May 1, and to proceed at the rate of one thousand tons per day of each twenty-four hours, weather permitting. On March 5, 1921, Frank B. Smith, of Sydney, had cabled the plaintiff an order for five thousand tons of bituminous limestone; and in his letter of March 15 to the defendant, the plaintiff advised the defendant company to be prepared to ship another five thousand tons of bituminous limestone, on or about May 6, 1921, in addition to the intended consignment for San Francisco. The name Henry E. White was indicated as the name of the person through whom this contract had been made, and it was stated that the consignee would be named later, no destination for the shipment being given. The plaintiff explains that the name White, as used in this letter, was based on an inference which he had erroneously drawn from the cable sent by Frank B. Smith, and his intention was to have the second shipment consigned to Australia in response to Smith's order. It will be noted in connection with this letter of the plaintiff, of March 15, 1921, that no mention was made of the names of the person, or firm, for whom the shipments were really intended. The obvious explanation that occurs in connection with this is that the plaintiff did not then care to reveal the fact that the two orders had originated from his own subagents in San Francisco and Sydney. To the plaintiff's letter of March 15, the assistant manager of the defendant company replied on March, 25, 1921, acknowledging the receipt of an order for five thousand tons of bituminous limestone to be consigned to John Chapman Co., of San Francisco, and the further amount of five thousand tons of the same material to be consigned to Henry E. White, and it was stated that "no orders can be entertained unless cash has been actually deposited with either the International Banking Corporation or the Chartered Bank of India, Australia and China, Cebu." (Exhibit Z.) To this letter the plaintiff in turn replied from Manila, under date of March, 1921, questioning the right of the defendant to insist upon a cash deposit in Cebu prior to the filling of the orders. In conclusion the plaintiff gave orders for shipment to Australia of five thousand tons, or more, about May 22, 1921, and ten thousand tons, or more, about June 1, 1921. In conclusion the plaintiff said "I have arranged for deposits to be made on these additional shipments if you will signify your ability to fulfill these orders on the dates mentioned." No name was mentioned as the purchaser, or purchases, of these intended Australian consignments. Soon after writing the letter last above-mentioned, the plaintiff embarked for China and Japan. With his activities in China we are not here concerned, but we note that in Tokio, Japan, he came in contact with one H. Hiwatari, who appears to have been a suitable person for handling bituminous limestone for construction work in Japan. In the letter Exhibit X, Hiwatari speaks of himself as if he had been appointed exclusive sales agent for the plaintiff in Japan, but no document expressly appointing him such is in evidence. While the plaintiff was in Tokio he procured the letter Exhibit W, addressed to himself, to be signed by Hiwatari. This letter, endited by the plaintiff himself, contains an order for one thousand tons of bituminous limestone from the quarries of the defendant company, to be delivered as soon after July 1, 1921, as possible. In this letter Hiwatari states, "on receipt of the cable from you, notifying me of date you will be ready to ship, and also tonnage rate, I will agree to transfer through the Bank of Taiwan, of Tokio, to the Asia Banking Corporation, of Manila, P. I., the entire payment of $16,000 gold, to be subject to our order on delivery of documents covering bill of lading of shipments, the customs report of weight, and prepaid export tax receipt. I will arrange in advance a confirmed or irrevocable letter of credit for the above amounts so that payment can be ordered by cable, in reply to your cable advising shipping date." In a letter, Exhibit X, of May 16, 1921, Hiwatari informs the plaintiff that he had shown the contract, signed by himself, to the submanager of the Taiwan Bank who had given it as his opinion that he would be able to issue, upon request of Hiwatari, a credit note for the contracted amount, but he added that the submanager was not personally able to place his approval on the contract as that was a matter beyond his authority. Accordingly Hiwatari advised that he was intending to make further arrangements when the manager of the bank should return from Formosa. In the letter of May 5, 1921, containing Hiwatari's order for one thousand tons of bituminous limestone, it was stated that if the material should prove satisfactory after being thoroughly tested by the Paving Department of the City of Tokio, he would contract with the plaintiff for a minimum quantity of ten thousand additional tons, to be used within a year from September 1, 1921, and that in this event the contract was to be automatically extended for an additional four years. The contents of the letter of May 5 seems to have been conveyed, though imperfectly, by the plaintiff to his attorney, Mr. Frank B. Ingersoll, of Manila; and on May 17, 1921, Ingersoll addressed a note to the defendant company in Cebu in which he stated that he had been requested by the plaintiff to notify the defendant that the plaintiff had accepted an order from Hiwatari, of Tokio, approved by the Bank of Taiwan, for a minimum order of ten thousand tons of the stone annually for a period of five years, the first shipment of one thousand tons to be made as early after July 1 as possible. It will be noted that this communication did not truly reflect the contents of Hiwatari's letter, which called unconditionally for only one thousand tons, the taking of the remainder being contingent upon future eventualities. It will be noted that the only written communications between the plaintiff and the defendant company in which the former gave notice of having any orders for the sale of bituminous limestone are the four letters Exhibit Y, AA, BB, and II. In the first of these letters, dated March 15, 1921, the plaintiff advises the defendant company to be prepared to ship five thousand tons of bituminous limestone, to be consigned to John Chapman, Co., of San Francisco, to be loaded by March 5, and a further consignment of five thousand tons, through a contract with Henry E. White, consignees to be named later. In the letter Exhibit BB dated May 17, 1921, the plaintiff's attorney gives notice of the acceptance by plaintiff of an order from Hiwatari, of Tokio, approved by the Bank of Taiwan, for a minimum of ten thousand annually for a period of five years, first shipment of a thousand tons to be as early after July 1 as possible. In the letter Exhibit H the plaintiff gives notice of an "additional" (?) order from H. E. White, Sydney, for two lots of bituminous limestone of five thousand tons each, one for shipment not later than June 30, 1921, and the other by July 20, 1921. In the same letter thousand tons from F. B. Smith, to be shipped to Brisbane, Australia, by June 30, and a similar amount within thirty days later. After the suit was brought, the plaintiff filed an amendment to his complaint in which he set out, in tabulated form, the orders which he claims to have received and upon which his letters of notification to the defendant company were based. In this amended answer the name of Ludvigsen & McCurdy appears for the first time; and the name of Frank B. Smith, of Sydney, is used for the first time as the source of the intended consignments of the letters, Exhibits G, L, M, and W, containing the orders from Ludvigen & McCurdy, Frank B. Smith and H. Hiwatari were at no time submitted for inspection to any officer of the defendant company, except possibly the Exhibit G, which the plaintiff claims to have shown to Anderson in Manila on March, 12, 1921. The different items conspiring the award which the trial judge gave in favor of the plaintiff are all based upon the orders given by Ludvigsen & McCurdy (Exhibit G), by Frank B. Smith (Exhibit L and M), and by Hiwatari in Exhibit W; and the appealed does not involve an order which came from Shanghai, China. We therefore now

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address ourselves to the question whether or not the orders contained in Exhibit G, L, M, and W, in connection with the subsequent notification thereof given by the plaintiff to the defendant, are sufficient to support the judgment rendered by the trial court. The transaction indicated in the orders from Ludvigsen, & McCurdy and from Frank B. Smith must, in our opinion, be at once excluded from consideration as emanating from persons who had been constituted mere agents of the plaintiff. The San Francisco order and the Australian orders are the same in legal effect as if they were orders signed by the plaintiff and drawn upon himself; and it cannot be pretended that those orders represent sales to bona fide purchasers found by the plaintiff. The original contract by which the plaintiff was appointed sales agent for a limited period of time in Australia and the United States contemplated that he should find reliable and solvent buyers who should be prepared to obligate themselves to take the quantity of bituminous limestone contracted for upon terms consistent with the contract. These conditions were not met by the taking of these orders from the plaintiff's own subagents, which was as if the plaintiff had bought for himself the commodity which he was authorized to sell to others. Article 267 of the Code of Commerce declares that no agent shall purchase for himself or for another that which he has been ordered to sell. The law has placed its ban upon a broker's purchasing from his principal unless the latter with full knowledge of all the facts and circumstances acquiesces in such course; and even then the broker's action must be characterized by the utmost good faith. A sale made by a broker to himself without the consent of the principal is ineffectual whether the broker has been guilty of fraudulent conduct or not. (4 R. C. L., 276-277.) We think, therefore, that the position of the defendant company is indubitably sound in so far as it rest upon the contention that the plaintiff has not in fact found any bona fide purchasers ready and able to take the commodity contracted for upon terms compatible with the contract which is the basis of the action. It will be observed that the contract set out at the beginning of this opinion contains provisions under which the period of the contract might be extended. That privilege was probably considered a highly important incident of the contract and it will be seen that the sale of five thousand tons which the plaintiff reported for shipment to San Francisco was precisely adjusted to the purpose of the extension of the contract for the United States for the period of an additional year; and the sales reported for shipment to Australia were likewise adjusted to the requirements for the extention of the contract in that territory. Given the circumstances surrounding these contracts as they were reported to the defendant company and the concealment by the plaintiff of the names of the authors of the orders, -- who after all were merely the plaintiff's subagents, the officers of the defendant company might justly have entertained the suspicion that the real and only person behind those contracts was the plaintiff himself. Such at least turns out to have been the case. Much energy has been expended in the briefs upon his appeal over the contention whether the defendant was justified in laying down the condition mentioned in the letter of March 26, 1921, to the effect that no order would be entertained unless cash should be deposited with either the International Banking Corporation of the Chartered Bank of India, Australia and China, in Cebu. In this connection the plaintiff points to the stipulation of the contract which provides that contracts with responsible parties are to be accepted "subject to draft attached to bill of lading in full payment of such shipment." What passed between the parties upon this point appears to have the character of mere diplomatic parrying, as the plaintiff had no contract from any responsible purchaser other than his own subagents and the defendant company could no probably have filled the contracts even if they had been backed by the Bank of England. Upon inspection of the plaintiff's letters (Exhibit Y and AA), there will be found ample assurance that deposits for the amount of each shipment would be made with a bank in Manila provided the defendant would indicated its ability to fill the orders; but these assurance rested upon no other basis than the financial responsibility of the plaintiff himself, and this circumstance doubtless did not escape the discernment of the defendant's officers. With respect to the order from H. Hiwatari, we observe that while he intimates that he had been promised the exclusive agency under the plaintiff for Japan, nevertheless it does not affirmatively appear that he had been in fact appointed to be such at the time he signed to order Exhibit W at the request of the plaintiff. It may be assumed, therefore, that he was at that time a stranger to the contract of agency. It clearly appears, however, that he did not expect to purchase the thousand tons of bituminous limestone referred to in his order without banking assistance; and although the submanager of the Bank of Taiwan had said something encouraging in respect to the matter, nevertheless that official had refrained from giving his approval to the order Exhibit W. It is therefore not shown affirmatively that this order proceeds from a responsible source. The first assignment of error in the appellant's brief is directed to the action of the trial judge in refusing to admit Exhibit 2, 7, 8, 9 and 10, offered by the defendant, and in admitting Exhibit E, offered by the plaintiff. The Exhibit 2 is a letter dated June 25, 1921, or more than three weeks after the action was instituted, in which the defendant's assistant general manager undertakes to reply to the plaintiff's letter of March 29 proceeding. It was evidently intended as an argumentative presentation of the plaintiff's point of view in the litigation then pending, and its probative value is so slight, even if admissible at all, that there was no error on the part of the trial court in excluding it. Exhibit 7, 8, 9 and 10 comprise correspondence which passed between the parties by mail or telegraph during the first part of the year 1921. The subject-matter of this correspondence relates to efforts that were being made by Anderson to dispose of the controlling in the defendant corporation, and Exhibit 9 in particular contains an offer from the plaintiff, representing certain associates, to but out Anderson's interest for a fixed sum. While these exhibits perhaps shed some light upon the relations of the parties during the time this controversy was brewing, the bearing of the matter upon the litigation before us is too remote to exert any definitive influence on the case. The trial court was not in error in our opinion in excluding these documents. Exhibit E is a letter from Anderson to the plaintiff, dated April 21, 1920, in which information is given concerning the property of the defendant company. It is stated in this letter that the output of the Lucio (quarry) during the coming year would probably be at the rate of about five tons for twenty-four hours, with the equipment then on hand, but that with the installation of a model cableway which was under contemplation, the company would be able to handle two thousand tons in twenty-four hours. We see no legitimate reason for rejecting this document, although of slight probative value; and her error imputed to the court in admitting the same was not committed. Exhibit 14, which was offered in evidence by the defendant, consists of a carbon copy of a letter dated June 13, 1921, written by the plaintiff to his attorney, Frank B. Ingersoll, Esq., of Manila, and in which plaintiff states, among other things, that his profit from the San Francisco contract would have been at the rate of eigthy-five cents (gold) per ton. The authenticity of this city document is admitted, and when it was offered in evidence by the attorney for the defendant the counsel for the plaintiff announced that he had no objection to the introduction of this carbon copy in evidence if counsel for the defendant would explain where this copy was secured. Upon this the attorney for the defendant informed the court that he received the letter from the former attorneys of the defendant without explanation of the manner in which the document had come into their possession. Upon this the attorney for the plaintiff made this announcement: "We hereby give notice at this time that unless such an explanation is made, explaining fully how this carbon copy came into the possession of the defendant company, or any one representing it, we propose to object to its admission on the ground that it is a confidential communication between client and lawyer." No further information was then given by the attorney for the defendant as to the manner in which the letter had come to his hands and the trial judge thereupon excluded the document, on the ground that it was a privileged communication between client and attorney. We are of the opinion that this ruling was erroneous; for even supposing that the letter was within the privilege which protects communications between attorney and client, this privilege was lost when the letter came to the hands of the adverse party. And it makes no difference how the adversary acquired possession. The law protects the client from the effect of disclosures made by him to his attorney in the confidence of the legal relation, but when such a document, containing admissions of the client, comes to the hand of a third party, and reaches the adversary, it is admissible in evidence. In this connection Mr. Wigmore says:

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The law provides subjective freedom for the client by assuring him of exemption from its processes of disclosure against himself or the attorney or their agents of communication. This much, but not a whit more, is necessary for the maintenance of the privilege. Since the means of preserving secrecy of communication are entirely in the client's hands, and since the privilege is a derogation from the general testimonial duty and should be strictly construed, it would be improper to extend its prohibition to third persons who obtain knowledge of the communications. One who overhears the communication, whether with or without the client's knowledge, is not within the protection of the privilege. The same rule ought to apply to one who surreptitiously reads or obtains possession of a document in original or copy. (5 Wigmore on Evidence, 2d ed., sec. 2326.) Although the precedents are somewhat confusing, the better doctrine is to the effect that when papers are offered in evidence a court will take no notice of how they were obtained, whether legally or illegally, properly or improperly; nor will it form a collateral issue to try that question. (10 R. C. L., 931; 1 Greenl. Evid., sec. 254a; State vs. Mathers, 15 L. R. A., 268; Gross vs. State, 33 L. R. A., [N. S.], 477, note.) Our conclusion upon the entire record is that the judgment appealed from must be reversed; and the defendant will be absolved from the complaint. It is so ordered, without special pronouncement as to costs of either instance. Separate Opinions MALCOLM, J., dissenting: An intensive scrutiny of every phase of this case leads me to the conclusion that the trial judge was correct in his findings of fact and in his decision. Without encumbering the case with a long and tedious dissent, I shall endeavor to explain my point of view as briefly and clearly as possible. A decision must be reached on the record as it is and not on a record as we would like to have it. The plaintiff and the defendant deliberately entered into a contract, the basis of this action. The plaintiff, proceeding pursuant to this contract, spent considerable effort and used considerable money to advance the interests of the defendant and to secure orders for its products. These orders were submitted to the president of the defendant company personally and later formally by writing. Prior to the institution of the suit, the only objection of the defendant was that the money should be deposited with either the International Banking Corporation or the Chartered Bank of India, Australia and China at Cebu, a stipulation not found in the contract. A reasonable deduction, therefore, is that the plaintiff presented orders under circumstances which were a substantial compliance with the terms of the contract with the defendant, and which insured to the defendant payment for its deliveries according to the price agreed upon, and that as the defendant has breached its contract, it must respond in damages. The current running through the majority opinion is that the order emanated from subagents of the plaintiff, and that no bona fide purchasers were ready and able to take the commodity contracted for upon terms compatible with the contract. The answer is, in the first place, that the contract nowhere prohibits the plaintiff to secure subagents. The answer is, in the second place, that the orders were so phrased as to make the persons making them personally responsible. The Ludvigsen & McCurdy order from San Francisco begins: "You can enter our order for 6,000 tons of bituminous limestone as per sample submitted, at $10 gold per ton, f. o. b., island of Leyte, subject to the following terms and conditions: * * * "(Exhibit G). The Smith order from Australia contains the following: "It is therefore with great pleasure I confirm the booking of the following orders, to be shipped at least within a week of respective dates: . . ." (Exhibit L). The Japan order starts with the following sentence: "You can enter my order for 1,000 tons of 1,000 kilos each of bituminous limestone from the quarries of the Leyte Asphalt and Mineral Oil Co. . . ." (Exhibit W.) But the main point of the plaintiff which the majority decision misses entirely centers on the proposition that the orders were communicated by the plaintiff to the defendant, and that the only objection the defendant had related to the manner of payment. To emphasize this thought again, let me quote the reply of the defendant to the plaintiff when the defendant acknowledge receipts of the orders placed by the plaintiff. The letter reads: "In reply to same we have to advice you that no orders can be entertained unless cash has been actually deposited with either the International Banking Corporation or the Chartered Bank of India, Australia and China, Cebu." (Exhibit Y.) Prior to the filing of suit, the defendant company never at any time raised any questioned as to whether the customers secured by plaintiff were "responsible firms" within the meaning of the contract, and never secured any information whatsoever as to their financial standing. Consequently, defendant is now estopped by its conduct from raising new objections for rejection of the orders. (Mechem on Agency, section 2441.) The majority decision incidentally takes up for consideration assignments of error 1 and 2 having to do with either the admission or the rejection by the trial court of certain exhibits. Having in mind that the Court reverses the court a quo on the facts, what is said relative to these two assignments is absolutely unnecessary for a judgment, and even as obiter dicta, contains unfortunate expressions. Exhibit 14, for example, is a letter addressed by the plaintiff to his lawyer and probably merely shown to the counsel of the defendant during negotiations to seek a compromise. Whether that exhibit be considered improperly rejected or not would not change the result one iota. The rule now announced by the Court that it makes no difference how the adversary acquired possession of the document, and that a court will take no notice of how it was obtained, is destructive of the attorney's privilege and constitutes and obstacle to attempts at friendly compromise. In the case of Uy Chico vs. Union Life Assurance Society ([1915], 29 Phil., 163), it was held that communications made by a client to his attorney for the purpose of being communicated to others are not privileged if they have been so communicated. But here, there is no intimation that Exhibit 14 was sent by the client to the lawyer for the purpose of being communicated to others. The Supreme Court of Georgia in the case of Southern Railway Co. vs. White ([1899], 108 Ga., 201), held that statements in a letter to a party's attorney handed by the latter to the opponent's attorney, are confidential communications and must be excluded. Briefly, the decision of the majority appears to me to be defective in the following particulars: (1) It sets aside without good reason the fair findings of fact as made by the trial court and substitutes therefor other findings not warranted by the proof; (2) it fails to stress plaintiff's main argument, and (3) it lay downs uncalled for rules which undermine the inviolability of a client's communications to his attorney. Accordingly, I dissent and vote for an affirmance of the judgment. G.R. Nos. 115439-41 July 16, 1997 PEOPLE OF THE PHILIPPINES, petitioner, vs. HONORABLE SANDIGANBAYAN, MANSUETO V. HONRADA, CEFERINO S. PAREDES, JR. and GENEROSO S. SANSAET, respondents. REGALADO, J.: Through the special civil action for certiorari at bar, petitioner seeks the annulment of the resolution of respondent Sandiganbayan, promulgated on December 22, 1993, which denied petitioner's motion for the discharge of respondent Generoso S. Sansaet to be utilized as a state witness, and its resolution of March 7, 1994 denying the motion for reconsideration of its preceding disposition. 1

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The records show that during the dates material to this case, respondent Honrada was the Clerk of Court and Acting Stenographer of the First Municipal Circuit Trial Court, San Francisco-Bunawan-Rosario in Agusan del Sur. Respondent Paredes was successively the Provincial Attorney of Agusan del Sur, then Governor of the same province, and is at present a Congressman. Respondent Sansaet was a practicing attorney who served as counsel for Paredes in several instances pertinent to the criminal charges involved in the present recourse. The same records also represent that sometime in 1976, respondent Paredes applied for a free patent over Lot No. 3097-A, Pls-67 of the Rosario Public Land Subdivision Survey. His application was approved and, pursuant to a free patent granted to him, an original certificate of title was issued in his favor for that lot which is situated in the poblacion of San Francisco, Agusan del Sur. However, in 1985, the Director of Lands filed an action 2 for the cancellation of respondent Paredes' patent and certificate of title since the land had been designated and reserved as a school site in the aforementioned subdivision survey. The trial court rendered judgment 3 nullifying said patent and title after finding that respondent Paredes had obtained the same through fraudulent misrepresentations in his application. Pertinently, respondent Sansaet served as counsel of Paredes in that civil case. 4 Consequent to the foregoing judgment of the trial court, upon the subsequent complaint of the Sangguniang Bayan and the preliminary investigation conducted thereon, an information for perjury 5 was filed against respondent Paredes in the Municipal Circuit Trial Court. 6 On November 27, 1985, the Provincial Fiscal was, however, directed by the Deputy Minister of Justice to move for the dismissal of the case on the ground inter alia of prescription, hence the proceedings were terminated. 7 In this criminal case, respondent Paredes was likewise represented by respondent Sansaet as counsel. Nonetheless, respondent Sansaet was thereafter haled before the Tanodbayan for preliminary investigation on the charge that, by using his former position as Provincial Attorney to influence and induce the Bureau of Lands officials to favorably act on his application for free patent, he had violated Section 3(a) of Republic Act No. 3019, as amended. For the third time, respondent Sansaet was Paredes' counsel of record therein. On August 29, 1988, the Tanodbayan, issued a resolution 8 recommending the criminal prosecution of respondent Paredes. Atty. Sansaet, as counsel for his aforenamed co-respondent, moved for reconsideration and, because of its legal significance in this case, we quote some of his allegations in that motion: . . . respondent had been charged already by the complainants before the Municipal Circuit Court of San Francisco, Agusan del Sur, went to jail on detention in 1984 under the same set of facts and the same evidence . . . but said case after arraignment, was ordered dismissed by the court upon recommendation of the Department of Justice. Copy of the dismissal order, certificate of arraignment and the recommendation of the Department of Justice are hereto attached for ready reference; thus the filing of this case will be a case of double jeopardy for respondent herein . . . 9 (Emphasis supplied.) A criminal case was subsequently filed with the Sandiganbayan 10 charging respondent Paredes with a violation of Section 3 (a) of Republic Act No. 3019, as amended. However, a motion to quash filed by the defense was later granted in respondent court's resolution of August 1, 1991 11 and the case was dismissed on the ground of prescription. On January 23, 1990, one Teofilo Gelacio, a taxpayer who had initiated the perjury and graft charges against respondent Paredes, sent a letter to the Ombudsman seeking the investigation of the three respondents herein for falsification of public documents. 12 He claimed that respondent Honrada, in conspiracy with his herein corespondents, simulated and certified as true copies certain documents purporting to be a notice of arraignment, dated July 1, 1985, and transcripts of stenographic notes supposedly taken during the arraignment of Paredes on the perjury charge. 13 These falsified documents were annexed to respondent Paredes' motion for reconsideration of the Tanodbayan resolution for the filing of a graft charge against him, in order to support his contention that the same would constitute double jeopardy. In support of his claim, Gelacio attached to his letter a certification that no notice of arraignment was ever received by the Office of the Provincial Fiscal of Agusan del Sur in connection with that perjury case; and a certification of Presiding Judge Ciriaco Ario that said perjury case in his court did not reach the arraignment stage since action thereon was suspended pending the review of the case by the Department of Justice. 14 Respondents filed their respective counter-affidavits, but Sansaet subsequently discarded and repudiated the submissions he had made in his counter-affidavit. In a socalled Affidavit of Explanations and Rectifications, 15 respondent Sansaet revealed that Paredes contrived to have the graft case under preliminary investigation dismissed on the ground of double jeopardy by making it appear that the perjury case had been dismissed by the trial court after he had been arraigned therein. For that purpose, the documents which were later filed by respondent Sansaet in the preliminary investigation were prepared and falsified by his co-respondents in this case in the house of respondent Paredes. To evade responsibility for his own participation in the scheme, he claimed that he did so upon the instigation and inducement of respondent Paredes. This was intended to pave the way for his discharge as a government witness in the consolidated cases, as in fact a motion therefor was filed by the prosecution pursuant to their agreement. Withal, in a resolution 16 dated February 24, 1992, the Ombudsman approved the filing of falsification charges against all the herein private respondents. The proposal for the discharge of respondent Sansaet as a state witness was rejected by the Ombudsman on this evaluative legal position: . . . Taking his explanation, it is difficult to believe that a lawyer of his stature, in the absence of deliberate intent to conspire, would be unwittingly induced by another to commit a crime. As counsel for the accused in those criminal cases, Atty. Sansaet had control over the case theory and the evidence which the defense was going to present. Moreover, the testimony or confession of Atty. Sansaet falls under the mantle of privileged communication between the lawyer and his client which may be objected to, if presented in the trial. The Ombudsman refused to reconsider that resolution 17 and, ostensibly to forestall any further controversy, he decided to file separate informations for falsification of public documents against each of the herein respondents. Thus, three criminal cases, 18 each of which named one of the three private respondents here as the accused therein, were filed in the graft court. However, the same were consolidated for joint trial in the Second Division of the Sandiganbayan. As stated at the outset, a motion was filed by the People on July 27, 1993 for the discharge of respondent Sansaet as a state witness. It was submitted that all the requisites therefor, as provided in Section 9, Rule 119 of the Rules of Court, were satisfied insofar as respondent Sansaet was concerned. The basic postulate was that, except for the eyewitness testimony of respondent Sansaet, there was no other direct evidence to prove the confabulated falsification of documents by respondents Honrada and Paredes. Unfortunately for the prosecution, respondent Sandiganbayan, hewing to the theory of the attorney-client privilege adverted to by the Ombudsman and invoked by the two other private respondents in their opposition to the prosecution's motion, resolved to deny the desired discharge on this ratiocination: From the evidence adduced, the opposition was able to establish that client and lawyer relationship existed between Atty. Sansaet and Ceferino Paredes, Jr., before, during and after the period alleged in the information. In view of such relationship, the facts surrounding the case, and other confidential matter must have been

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disclosed by accused Paredes, as client, to accused Sansaet, as his lawyer in his professional capacity. Therefore, the testimony of Atty. Sansaet on the facts surrounding the offense charged in the information is privileged. 19 Reconsideration of said resolution having been likewise denied, 20 the controversy was elevated to this Court by the prosecution in an original action for the issuance of the extraordinary writ of certiorari against respondent Sandiganbayan. The principal issues on which the resolution of the petition at bar actually turns are therefore (1) whether or not the projected testimony of respondent Sansaet, as proposed state witness, is barred by the attorney-client privilege; and (2) whether or not, as a consequence thereof, he is eligible for discharge to testify as a particeps criminis. As already stated, respondent Sandiganbayan ruled that due to the lawyer-client relationship which existed between herein respondents Paredes and Sansaet during the relevant periods, the facts surrounding the case and other confidential matters must have been disclosed by respondent Paredes, as client, to respondent Sansaet, as his lawyer. Accordingly, it found "no reason to discuss it further since Atty. Sansaet cannot be presented as a witness against accused Ceferino S. Paredes, Jr. without the latter's consent." 21 The Court is of a contrary persuasion. The attorney-client privilege cannot apply in these cases, as the facts thereof and actuations of both respondents therein constitute an exception to the rule. For a clearer understanding of that evidential rule, we will first sweep aside some distracting mental cobwebs in these cases. 1. It may correctly be assumed that there was a confidential communication made by Paredes to Sansaet in connection with Criminal Cases Nos. 17791-93 for falsification before respondent court, and this may reasonably be expected since Paredes was the accused and Sansaet his counsel therein. Indeed, the fact that Sansaet was called to witness the preparation of the falsified documents by Paredes and Honrada was as eloquent a communication, if not more, than verbal statements being made to him by Paredes as to the fact and purpose of such falsification. It is significant that the evidentiary rule on this point has always referred to "any communication," without distinction or qualification. 22 In the American jurisdiction from which our present evidential rule was taken, there is no particular mode by which a confidential communication shall be made by a client to his attorney. The privilege is not confined to verbal or written communications made by the client to his attorney but extends as well to information communicated by the client to the attorney by other means. 23 Nor can it be pretended that during the entire process, considering their past and existing relations as counsel and client and, further, in view of the purpose for which such falsified documents were prepared, no word at all passed between Paredes and Sansaet on the subject matter of that criminal act. The clincher for this conclusion is the undisputed fact that said documents were thereafter filed by Sansaet in behalf of Paredes as annexes to the motion for reconsideration in the preliminary investigation of the graft case before the Tanodbayan. 24 Also, the acts and words of the parties during the period when the documents were being falsified were necessarily confidential since Paredes would not have invited Sansaet to his house and allowed him to witness the same except under conditions of secrecy and confidence. 2. It is postulated that despite such complicity of Sansaet at the instance of Paredes in the criminal act for which the latter stands charged, a distinction must be made between confidential communications relating to past crimes already committed, and future crimes intended to be committed, by the client. Corollarily, it is admitted that the announced intention of a client to commit a crime is not included within the confidences which his attorney is bound to respect. Respondent court appears, however, to believe that in the instant case it is dealing with a past crime, and that respondent Sansaet is set to testify on alleged criminal acts of respondents Paredes and Honrada that have already been committed and consummated. The Court reprobates the last assumption which is flawed by a somewhat inaccurate basis. It is true that by now, insofar as the falsifications to be testified to in respondent court are concerned, those crimes were necessarily committed in the past. But for the application of the attorney-client privilege, however, the period to be considered is the date when the privileged communication was made by the client to the attorney in relation to either a crime committed in the past or with respect to a crime intended to be committed in the future. In other words, if the client seeks his lawyer's advice with respect to a crime that the former has theretofore committed, he is given the protection of a virtual confessional seal which the attorney-client privilege declares cannot be broken by the attorney without the client's consent. The same privileged confidentiality, however, does not attach with regard to a crime which a client intends to commit thereafter or in the future and for purposes of which he seeks the lawyer's advice. Statements and communications regarding the commission of a crime already committed, made by a party who committed it, to an attorney, consulted as such, are privileged communications. Contrarily, the unbroken stream of judicial dicta is to the effect that communications between attorney and client having to do with the client's contemplated criminal acts, or in aid or furtherance thereof, are not covered by the cloak of privileges ordinarily existing in reference to communications between attorney and client. 25 (Emphases supplied.) 3. In the present cases, the testimony sought to be elicited from Sansate as state witness are the communications made to him by physical acts and/or accompanying words of Parades at the time he and Honrada, either with the active or passive participation of Sansaet, were about to falsify, or in the process of falsifying, the documents which were later filed in the Tanodbayan by Sansaet and culminated in the criminal charges now pending in respondent Sandiganbayan. Clearly, therefore, the confidential communications thus made by Paredes to Sansaet were for purposes of and in reference to the crime of falsification which had not yet been committed in the past by Paredes but which he, in confederacy with his present co-respondents, later committed. Having been made for purposes of a future offense, those communications are outside the pale of the attorney-client privilege. 4. Furthermore, Sansaet was himself a conspirator in the commission of that crime of falsification which he, Paredes and Honrada concocted and foisted upon the authorities. It is well settled that in order that a communication between a lawyer and his client may be privileged, it must be for a lawful purpose or in furtherance of a lawful end. The existence of an unlawful purpose prevents the privilege from attaching. 26 In fact, it has also been pointed out to the Court that the "prosecution of the honorable relation of attorney and client will not be permitted under the guise of privilege, and every communication made to an attorney by a client for a criminal purpose is a conspiracy or attempt at a conspiracy which is not only lawful to divulge, but which the attorney under certain circumstances may be bound to disclose at once in the interest of justice." 27 It is evident, therefore, that it was error for respondent Sandiganbayan to insist that such unlawful communications intended for an illegal purpose contrived by conspirators are nonetheless covered by the so-called mantle of privilege. To prevent a conniving counsel from revealing the genesis of a crime which was later committed pursuant to a conspiracy, because of the objection thereto of his conspiring client, would be one of the worst travesties in the rules of evidence and practice in the noble profession of law. II On the foregoing premises, we now proceed to the consequential inquiry as to whether respondent Sansaet qualifies, as a particeps criminis, for discharge from the criminal prosecution in order to testify for the State. Parenthetically, respondent court, having arrived at a contrary conclusion on the preceding issue, did not pass upon

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this second aspect and the relief sought by the prosecution which are now submitted for our resolution in the petition at bar. We shall, however, first dispose likewise of some ancillary questions requiring preludial clarification. 1. The fact that respondent Sandiganbayan did not fully pass upon the query as to whether or not respondent Sansaet was qualified to be a state witness need not prevent this Court from resolving that issue as prayed for by petitioner. Where the determinative facts and evidence have been submitted to this Court such that it is in a position to finally resolve the dispute, it will be in the pursuance of the ends of justice and the expeditious administration thereof to resolve the case on the merits, instead of remanding it to the trial court. 28 2. A reservation is raised over the fact that the three private respondents here stand charged in three separate informations. It will be recalled that in its resolution of February 24, 1992, the Ombudsman recommended the filing of criminal charges for falsification of public documents against all the respondents herein. That resolution was affirmed but, reportedly in order to obviate further controversy, one information was filed against each of the three respondents here, resulting in three informations for the same acts of falsification. This technicality was, however, sufficiently explained away during the deliberations in this case by the following discussion thereof by Mr. Justice Davide, to wit: Assuming no substantive impediment exists to block Sansaet's discharge as state witness, he can, nevertheless, be discharged even if indicted under a separate information. I suppose the three cases were consolidated for joint trial since they were all raffled to the Second Division of the Sandiganbayan. Section 2, Rule XV of the Revised Rules of the Sandiganbayan allows consolidation in only one Division of cases arising from the same incident or series of incidents, or involving common questions of law and fact. Accordingly, for all legal intents and purposes, Sansaet stood as co-accused and he could be discharged as state witness. It is of no moment that he was charged separately from his co-accused. While Section 9 of Rule 119 of the 1985 Rules of Criminal Procedure uses the word jointly, which was absent in the old provision, the consolidated and joint trial has the effect of making the three accused co-accused or joint defendants, especially considering that they are charged for the same offense. In criminal law, persons indicted for the same offense and tried together are called joint defendants. As likewise submitted therefor by Mr. Justice Francisco along the same vein, there having been a consolidation of the three cases, the several actions lost their separate identities and became a single action in which a single judgment is rendered, the same as if the different causes of action involved had originally been joined in a single action. 29 Indeed, the former provision of the Rules referring to the situation "(w)hen two or more persons are charged with the commission of a certain offense" was too broad and indefinite; hence the word "joint" was added to indicate the identity of the charge and the fact that the accused are all together charged therewith substantially in the same manner in point of commission and time. The word "joint" means "common to two or more," as "involving the united activity of two or more," or "done or produced by two or more working together," or "shared by or affecting two or more. 30 Had it been intended that all the accused should always be indicted in one and the same information, the Rules could have said so with facility, but it did not so require in consideration of the circumstances obtaining in the present case and the problems that may arise from amending the information. After all, the purpose of the Rule can be achieved by consolidation of the cases as an alternative mode. 2. We have earlier held that Sansaet was a conspirator in the crime of falsification, and the rule is that since in a conspiracy the act of one is the act of all, the same penalty shall be imposed on all members of the conspiracy. Now, one of the requirements for a state witness is that he "does not appear to be the most guilty." 31 not that he must be the least guilty 32 as is so often erroneously framed or submitted. The query would then be whether an accused who was held guilty by reason of membership in a conspiracy is eligible to be a state witness. To be sure, in People vs. Ramirez, et al. 33 we find this obiter: It appears that Apolonio Bagispas was the real mastermind. It is believable that he persuaded the others to rob Paterno, not to kill him for a promised fee. Although he did not actually commit any of the stabbings, it was a mistake to discharge Bagispas as a state witness. All the perpetrators of the offense, including him, were bound in a conspiracy that made them equally guilty. However, prior thereto, in People vs. Roxas, et al., 34 two conspirators charged with five others in three separate informations for multiple murder were discharged and used as state witnesses against their confederates. Subsequent thereto, in Lugtu, et al. vs. Court of Appeals, et al., 35 one of the co-conspirators was discharged from the information charging him and two others with the crime of estafa. The trial court found that he was not the most guilty as, being a poor and ignorant man, he was easily convinced by his two co-accused to open the account with the bank and which led to the commission of the crime. On appeal, this Court held that the finding of respondent appellate court that Lugtu was just as guilty as his co-accused, and should not be discharged as he did not appear to be not the most guilty, is untenable. In other words, the Court took into account the gravity or nature of the acts committed by the accused to be discharged compared to those of his co-accused, and not merely the fact that in law the same or equal penalty is imposable on all of them. Eventually, what was just somehow assumed but not explicity articulated found expression in People vs. Ocimar, et al., 36 which we quote in extenso: Ocimar contends that in the case at bar Bermudez does not satisfy the conditions for the discharge of a co-accused to become a state witness. He argues that no accused in a conspiracy can lawfully be discharged and utilized as a state witness, for not one of them could satisfy the requisite of appearing not to be the most guilty. Appellant asserts that since accused Bermudez was part of the conspiracy, he is equally guilty as the others. We do not agree. First, there is absolute necessity for the testimony of Bermudez. For, despite the presentation of four (4) other witnesses, none of them could positively identify the accused except Bermudez who was one of those who pulled the highway heist which resulted not only in the loss of cash, jewelry and other valuables, but even the life of Capt. Caeba, Jr. It was in fact the testimony of Bermudez that clinched the case for the prosecution. Second, without his testimony, no other direct evidence was available for the prosecution to prove the elements of the crime. Third, his testimony could be, as indeed it was, substantially corroborated in its material points as indicated by the trial court in its well-reasoned decision. Fourth, he does not appear to be the most guilty. As the evidence reveals, he was only invited to a drinking party without having any prior knowledge of the plot to stage a highway robbery. But even assuming that he later became part of the conspiracy, he does not appear to be the most guilty. What the law prohibits is that the most guilty will be set free while his co-accused who are less guilty will be sent to jail. And by "most guilty" we mean the highest degree of culpability in terms of participation in the commission of the offense and not necessarily the severity of the penalty imposed. While all the accused may be given the same penalty by reason of conspiracy, yet one may be considered least guilty if We take into account his degree of participation in the perpetration of the offense. Fifth, there is no evidence that he has at any time been convicted of any offense involving moral turpitude. xxx xxx xxx

Thus, We agree with the observations of the Solicitor General that the rule on the discharge of an accused to be utilized as state witness clearly looks at his actual and individual participation in the commission of the crime, which may or may not have been perpetrated in conspiracy with the other accused. Since Bermudez was not individually responsible for the killing committed on the occasion of the robbery except by reason of conspiracy, it cannot be said then that Bermudez appears to be the most guilty. Hence, his discharge to be a witness for the government is clearly warranted. (Emphasis ours.)

19
The rule of equality in the penalty to be imposed upon conspirators found guilty of a criminal offense is based on the concurrence of criminal intent in their minds and translated into concerted physical action although of varying acts or degrees of depravity. Since the Revised Penal Code is based on the classical school of thought, it is the identity of the mens rea which is considered the predominant consideration and, therefore, warrants the imposition of the same penalty on the consequential theory that the act of one is thereby the act of all. Also, this is an affair of substantive law which should not be equated with the procedural rule on the discharge of particeps criminis. This adjective device is based on other considerations, such as the need for giving immunity to one of them in order that not all shall escape, and the judicial experience that the candid admission of an accused regarding his participation is a guaranty that he will testify truthfully. For those reasons, the Rules provide for certain qualifying criteria which, again, are based on judicial experience distilled into a judgmental policy. III The Court is reasonably convinced, and so holds, that the other requisites for the discharge of respondent Sansaet as a state witness are present and should have been favorably appreciated by the Sandiganbayan. Respondent Sansaet is the only cooperative eyewitness to the actual commission of the falsification charged in the criminal cases pending before respondent court, and the prosecution is faced with the formidable task of establishing the guilt of the two other co-respondents who steadfastly deny the charge and stoutly protest their innocence. There is thus no other direct evidence available for the prosecution of the case, hence there is absolute necessity for the testimony of Sansaet whose discharge is sought precisely for that purpose. Said respondent has indicated his conformity thereto and has, for the purposes required by the Rules, detailed the substance of his projected testimony in his Affidavit of Explanation and Rectifications. His testimony can be substantially corroborated on its material points by reputable witnesses, identified in the basic petition with a digest of their prospective testimonies, as follows: Judge Ciriaco C. Ario, Municipal Circuit Trial Court in San Francisco, Agusan del Sur; Provincial Prosecutor and Deputized Ombudsman Prosecutor Claudio A. Nistal; Teofilo Gelacio, private complainant who initiated the criminal cases through his letter-complaint; Alberto Juvilan of the Sangguniang Bayan of San Fernando, Agusan del Sur, who participated in the resolution asking their Provincial Governor to file the appropriate case against respondent Paredes, and Francisco Macalit, who obtained the certification of non-arraignment from Judge Ario. On the final requirement of the Rules, it does not appear that respondent Sansaet has at any time been convicted of any offense involving moral turpitude. Thus, with the confluence of all the requirements for the discharge of this respondent, both the Special Prosecutor and the Solicitor General strongly urge and propose that he be allowed to testify as a state witness. This Court is not unaware of the doctrinal rule that, on this procedural aspect, the prosecution may propose but it is for the trial court, in the exercise of its sound discretion, to determine the merits of the proposal and make the corresponding disposition. It must be emphasized, however, that such discretion should have been exercised, and the disposition taken on a holistic view of all the facts and issues herein discussed, and not merely on the sole issue of the applicability of the attorneyclient privilege. This change of heart and direction respondent Sandiganbayan eventually assumed, after the retirement of two members of its Second Division 37 and the reconstitution thereof. In an inversely anticlimactic Manifestation and Comment 38 dated June 14, 1995, as required by this Court in its resolution on December 5, 1994, the chairman and new members thereof 39 declared: 4) That the questioned Resolutions of December 22, 1993 and March 7, 1994 upon which the Petition for Certiorari filed by the prosecution are based, was penned by Associate Justice Narciso T. Atienza and concurred in by the undersigned and Associate Justice Augusto M. Amores; 5) That while the legal issues involved had been already discussed and passed upon by the Second Division in the aforesaid Resolution, however, after going over the arguments submitted by the Solicitor-General and re-assessing Our position on the matter, We respectfully beg leave of the Honorable Supreme Court to manifest that We are amenable to setting aside the questioned Resolutions and to grant the prosecution's motion to discharge accused Generoso Sansaet as state witness, upon authority of the Honorable Supreme Court for the issuance of the proper Resolution to that effect within fifteen (15) days from notice thereof. WHEREFORE, the writ of certiorari prayed for is hereby granted SETTING ASIDE the impunged resolutions and ORDERING that the present reliefs sought in these cases by petitioner be allowed and given due course by respondent Sandiganbayan. SO ORDERED. G.R. No. 105938 September 20, 1996 TEODORO R. REGALA, EDGARDO J. ANGARA, AVELINO V. CRUZ, JOSE C. CONCEPCION, ROGELIO A. VINLUAN, VICTOR P. LAZATIN and EDUARDO U. ESCUETA, petitioners, vs. THE HONORABLE SANDIGANBAYAN, First Division, REPUBLIC OF THE PHILIPPINES, ACTING THROUGH THE PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT, and RAUL S. ROCO, respondents. G.R. No. 108113 September 20, 1996 PARAJA G. HAYUDINI, petitioner, vs. THE SANDIGANBAYAN and THE REPUBLIC OF THE PHILIPPINES, respondents. KAPUNAN, J.: These case touch the very cornerstone of every State's judicial system, upon which the workings of the contentious and adversarial system in the Philippine legal process are based the sanctity of fiduciary duty in the client-lawyer relationship. The fiduciary duty of a counsel and advocate is also what makes the law profession a unique position of trust and confidence, which distinguishes it from any other calling. In this instance, we have no recourse but to uphold and strengthen the mantle of protection accorded to the confidentiality that proceeds from the performance of the lawyer's duty to his client. The facts of the case are undisputed. The matters raised herein are an offshoot of the institution of the Complaint on July 31, 1987 before the Sandiganbayan by the Republic of the Philippines, through the Presidential Commission on Good Government against Eduardo M. Cojuangco, Jr., as one of the principal defendants, for the recovery of alleged ill-gotten wealth, which includes shares of stocks in the named corporations in PCGG Case No. 33 (Civil Case No. 0033), entitled "Republic of the Philippines versus Eduardo Cojuangco, et al." 1

20
Among the dependants named in the case are herein petitioners Teodoro Regala, Edgardo J. Angara, Avelino V. Cruz, Jose C. Concepcion, Rogelio A. Vinluan, Victor P. Lazatin, Eduardo U. Escueta and Paraja G. Hayudini, and herein private respondent Raul S. Roco, who all were then partners of the law firm Angara, Abello, Concepcion, Regala and Cruz Law Offices (hereinafter referred to as the ACCRA Law Firm). ACCRA Law Firm performed legal services for its clients, which included, among others, the organization and acquisition of business associations and/or organizations, with the correlative and incidental services where its members acted as incorporators, or simply, as stockholders. More specifically, in the performance of these services, the members of the law firm delivered to its client documents which substantiate the client's equity holdings, i.e., stock certificates endorsed in blank representing the shares registered in the client's name, and a blank deed of trust or assignment covering said shares. In the course of their dealings with their clients, the members of the law firm acquire information relative to the assets of clients as well as their personal and business circumstances. As members of the ACCRA Law Firm, petitioners and private respondent Raul Roco admit that they assisted in the organization and acquisition of the companies included in Civil Case No. 0033, and in keeping with the office practice, ACCRA lawyers acted as nomineesstockholders of the said corporations involved in sequestration proceedings. 2 On August 20, 1991, respondent Presidential Commission on Good Government (hereinafter referred to as respondent PCGG) filed a "Motion to Admit Third Amended Complaint" and "Third Amended Complaint" which excluded private respondent Raul S. Roco from the complaint in PCGG Case No. 33 as party-defendant. 3 Respondent PCGG based its exclusion of private respondent Roco as party-defendant on his undertaking that he will reveal the identity of the principal/s for whom he acted as nominee/stockholder in the companies involved in PCGG Case No. 33. 4 Petitioners were included in the Third Amended Complaint on the strength of the following allegations: 14. Defendants Eduardo Cojuangco, Jr., Edgardo J. Angara, Jose C. Concepcion, Teodoro Regala, Avelino V. Cruz, Rogelio A. Vinluan, Eduardo U. Escueta, Paraja G. Hayudini and Raul Roco of the Angara Concepcion Cruz Regala and Abello law offices (ACCRA) plotted, devised, schemed conspired and confederated with each other in setting up, through the use of the coconut levy funds, the financial and corporate framework and structures that led to the establishment of UCPB, UNICOM, COCOLIFE, COCOMARK, CIC, and more than twenty other coconut levy funded corporations, including the acquisition of San Miguel Corporation shares and its institutionalization through presidential directives of the coconut monopoly. Through insidious means and machinations, ACCRA, being the wholly-owned investment arm, ACCRA Investments Corporation, became the holder of approximately fifteen million shares representing roughly 3.3% of the total outstanding capital stock of UCPB as of 31 March 1987. This ranks ACCRA Investments Corporation number 44 among the top 100 biggest stockholders of UCPB which has approximately 1,400,000 shareholders. On the other hand, corporate books show the name Edgardo J. Angara as holding approximately 3,744 shares as of February, 1984. 5 In their answer to the Expanded Amended Complaint, petitioners ACCRA lawyers alleged that: 4.4 Defendants-ACCRA lawyers' participation in the acts with which their codefendants are charged, was in furtherance of legitimate lawyering.

4.4.1 In the course of rendering professional and legal services to clients, defendants-ACCRA lawyers, Jose C. Concepcion, Teodoro D. Regala, Rogelio A. Vinluan and Eduardo U. Escueta, became holders of shares of stock in the corporations listed under their respective names in Annex "A" of the expanded Amended Complaint as incorporating or acquiring stockholders only and, as such, they do not claim any proprietary interest in the said shares of stock. 4.5 Defendant ACCRA-lawyer Avelino V. Cruz was one of the incorporators in 1976 of Mermaid Marketing Corporation, which was organized for legitimate business purposes not related to the allegations of the expanded Amended Complaint. However, he has long ago transferred any material interest therein and therefore denies that the "shares" appearing in his name in Annex "A" of the expanded Amended Complaint are his assets. 6 Petitioner Paraja Hayudini, who had separated from ACCRA law firm, filed a separate answer denying the allegations in the complaint implicating him in the alleged ill-gotten wealth. 7 Petitioners ACCRA lawyers subsequently filed their "COMMENT AND/OR OPPOSITION" dated October 8, 1991 with Counter-Motion that respondent PCGG similarly grant the same treatment to them (exclusion as parties-defendants) as accorded private respondent Roco. 8 The Counter-Motion for dropping petitioners from the complaint was duly set for hearing on October 18, 1991 in accordance with the requirements of Rule 15 of the Rules of Court. In its "Comment," respondent PCGG set the following conditions precedent for the exclusion of petitioners, namely: (a) the disclosure of the identity of its clients; (b) submission of documents substantiating the lawyer-client relationship; and (c) the submission of the deeds of assignments petitioners executed in favor of its client covering their respective shareholdings. 9 Consequently, respondent PCGG presented supposed proof to substantiate compliance by private respondent Roco of the conditions precedent to warrant the latter's exclusion as party-defendant in PCGG Case No. 33, to wit: (a) Letter to respondent PCGG of the counsel of respondent Roco dated May 24, 1989 reiterating a previous request for reinvestigation by the PCGG in PCGG Case No. 33; (b) Affidavit dated March 8, 1989 executed by private respondent Roco as Attachment to the letter aforestated in (a); and (c) Letter of the Roco, Bunag, and Kapunan Law Offices dated September 21, 1988 to the respondent PCGG in behalf of private respondent Roco originally requesting the reinvestigation and/or re-examination of the evidence of the PCGG against Roco in its Complaint in PCGG Case No. 33. 10 It is noteworthy that during said proceedings, private respondent Roco did not refute petitioners' contention that he did actually not reveal the identity of the client involved in PCGG Case No. 33, nor had he undertaken to reveal the identity of the client for whom he acted as nominee-stockholder. 11 On March 18, 1992, respondent Sandiganbayan promulgated the Resolution, herein questioned, denying the exclusion of petitioners in PCGG Case No. 33, for their refusal to comply with the conditions required by respondent PCGG. It held: xxx xxx xxx

ACCRA lawyers may take the heroic stance of not revealing the identity of the client for whom they have acted, i.e. their principal, and that will be their choice. But until they do identify their clients, considerations of whether or not the privilege claimed by the ACCRA lawyers exists cannot even begin to be debated. The ACCRA lawyers cannot excuse themselves from the consequences of their acts until they have begun to establish the basis for recognizing the privilege; the existence and identity of the client. This is what appears to be the cause for which they have been impleaded by the PCGG as defendants herein. 5. The PCGG is satisfied that defendant Roco has demonstrated his agency and that Roco has apparently identified his principal, which revelation could show the lack of cause against him. This in turn has allowed the PCGG to exercise its power both under the rules of Agency and under Section 5 of E.O. No. 14-A in relation to the Supreme Court's ruling in Republic v. Sandiganbayan (173 SCRA 72).

21
The PCGG has apparently offered to the ACCRA lawyers the same conditions availed of by Roco; full disclosure in exchange for exclusion from these proceedings (par. 7, PCGG's COMMENT dated November 4, 1991). The ACCRA lawyers have preferred not to make the disclosures required by the PCGG. The ACCRA lawyers cannot, therefore, begrudge the PCGG for keeping them as party defendants. In the same vein, they cannot compel the PCGG accorded the same treatment accorded to Roco. Neither can this Court. WHEREFORE, the Counter Motion dated October 8, 1991 filed by the ACCRA lawyers and joined in by Atty. Paraja G. Hayudini for the same treatment by the PCGG as accorded to Raul S. Roco is DENIED for lack of merit. 12 ACCRA lawyers moved for a reconsideration of the above resolution but the same was denied by the respondent Sandiganbayan. Hence, the ACCRA lawyers filed the petition for certiorari, docketed as G.R. No. 105938, invoking the following grounds: I The Honorable Sandiganbayan gravely abused its discretion in subjecting petitioners ACCRA lawyers who undisputably acted as lawyers in serving as nomineestockholders, to the strict application of the law of agency. II The Honorable Sandiganbayan committed grave abuse of discretion in not considering petitioners ACCRA lawyers and Mr. Roco as similarly situated and, therefore, deserving of equal treatment. 1. There is absolutely no evidence that Mr. Roco had revealed, or had undertaken to reveal, the identities of the client(s) for whom he acted as nomineestockholder. 2. Even assuming that Mr. Roco had revealed, or had undertaken to reveal, the identities of the client(s), the disclosure does not constitute a substantial distinction as would make the classification reasonable under the equal protection clause. 3. III The Honorable Sandiganbayan committed grave abuse of discretion in not holding that, under the facts of this case, the attorney-client privilege prohibits petitioners ACCRA lawyers from revealing the identity of their client(s) and the other information requested by the PCGG. 1. 2. matters. IV The Honorable Sandiganbayan committed grave abuse of discretion in not requiring that the dropping of party-defendants by the PCGG must be based on reasonable and just grounds and with due consideration to the constitutional right of petitioners ACCRA lawyers to the equal protection of the law. Petitioner Paraja G. Hayudini, likewise, filed his own motion for reconsideration of the March 18, 1991 resolution which was denied by respondent Sandiganbayan. Thus, he filed a separate petition for certiorari, docketed as G.R. No. 108113, assailing respondent Sandiganbayan's resolution on essentially the same grounds averred by petitioners in G.R. No. 105938. Petitioners contend that the exclusion of respondent Roco as party-defendant in PCGG Case No. 33 grants him a favorable treatment, on the pretext of his alleged undertaking to divulge the identity of his client, giving him an advantage over them who are in the same footing as partners in the ACCRA law firm. Petitioners further argue that even granting that such an undertaking has been assumed by private respondent Roco, they are prohibited from revealing the identity of their principal under their sworn mandate and fiduciary duty as lawyers to uphold at all times the confidentiality of information obtained during such lawyer-client relationship. Respondent PCGG, through its counsel, refutes petitioners' contention, alleging that the revelation of the identity of the client is not within the ambit of the lawyer-client confidentiality privilege, nor are the documents it required (deeds of assignment) protected, because they are evidence of nominee status. 13 In his comment, respondent Roco asseverates that respondent PCGG acted correctly in excluding him as party-defendant because he "(Roco) has not filed an Answer. PCGG had therefore the right to dismiss Civil Case No. 0033 as to Roco 'without an order of court by filing a notice of dismissal'," 14 and he has undertaken to identify his principal. 15 Petitioners' contentions are impressed with merit. I It is quite apparent that petitioners were impleaded by the PCGG as co-defendants to force them to disclose the identity of their clients. Clearly, respondent PCGG is not after petitioners but the "bigger fish" as they say in street parlance. This ploy is quite clear from the PCGG's willingness to cut a deal with petitioners the names of their clients in exchange for exclusion from the complaint. The statement of the Sandiganbayan in its questioned resolution dated March 18, 1992 is explicit: ACCRA lawyers may take the heroic stance of not revealing the identity of the client for whom they have acted, i.e, their principal, and that will be their choice. But until they do identify their clients, considerations of whether or not the privilege claimed by the ACCRA lawyers exists cannot even begin to be debated. The ACCRA lawyers cannot excuse themselves from the consequences of their acts until they have begun to establish the basis for recognizing the privilege; the existence and identity of the client. This is what appears to be the cause for which they have been impleaded by the PCGG as defendants herein. (Emphasis ours) Under the peculiar facts of this case, the attorney-client privilege includes the identity of the client(s). The factual disclosures required by the PCGG are not limited to the identity of petitioners ACCRA lawyers' alleged client(s) but extend to other privileged Respondent Sandiganbayan sanctioned favoritism and undue preference in favor of Mr. Roco in violation of the equal protection clause. to be

22
In a closely related case, Civil Case No. 0110 of the Sandiganbayan, Third Division, entitled "Primavera Farms, Inc., et al. vs. Presidential Commission on Good Government" respondent PCGG, through counsel Mario Ongkiko, manifested at the hearing on December 5, 1991 that the PCGG wanted to establish through the ACCRA that their "so called client is Mr. Eduardo Cojuangco;" that "it was Mr. Eduardo Cojuangco who furnished all the monies to those subscription payments in corporations included in Annex "A" of the Third Amended Complaint; that the ACCRA lawyers executed deeds of trust and deeds of assignment, some in the name of particular persons; some in blank. We quote Atty. Ongkiko: ATTY. ONGKIKO: With the permission of this Hon. Court. I propose to establish through these ACCRA lawyers that, one, their so-called client is Mr. Eduardo Cojuangco. Second, it was Mr. Eduardo Cojuangco who furnished all the monies to these subscription payments of these corporations who are now the petitioners in this case. Third, that these lawyers executed deeds of trust, some in the name of a particular person, some in blank. Now, these blank deeds are important to our claim that some of the shares are actually being held by the nominees for the late President Marcos. Fourth, they also executed deeds of assignment and some of these assignments have also blank assignees. Again, this is important to our claim that some of the shares are for Mr. Conjuangco and some are for Mr. Marcos. Fifth, that most of thes e corporations are really just paper corporations. Why do we say that? One: There are no really fixed sets of officers, no fixed sets of directors at the time of incorporation and even up to 1986, which is the crucial year. And not only that, they have no permits from the municipal authorities in Makati. Next, actually all their addresses now are care of Villareal Law Office. They really have no address on records. These are some of the principal things that we would ask of these nominees stockholders, as they called themselves. 16 It would seem that petitioners are merely standing in for their clients as defendants in the complaint. Petitioners are being prosecuted solely on the basis of activities and services performed in the course of their duties as lawyers. Quite obviously, petitioners' inclusion as co-defendants in the complaint is merely being used as leverage to compel them to name their clients and consequently to enable the PCGG to nail these clients. Such being the case, respondent PCGG has no valid cause of action as against petitioners and should exclude them from the Third Amended Complaint. II The nature of lawyer-client relationship is premised on the Roman Law concepts of locatio conductio operarum (contract of lease of services) where one person lets his services and another hires them without reference to the object of which the services are to be performed, wherein lawyers' services may be compensated by honorarium or for hire, 17 and mandato (contract of agency) wherein a friend on whom reliance could be placed makes a contract in his name, but gives up all that he gained by the contract to the person who requested him. 18 But the lawyer-client relationship is more than that of the principal-agent and lessor-lessee. In modern day perception of the lawyer-client relationship, an attorney is more than a mere agent or servant, because he possesses special powers of trust and confidence reposed on him by his client. 19 A lawyer is also as independent as the judge of the court, thus his powers are entirely different from and superior to those of an ordinary agent. 20 Moreover, an attorney also occupies what may be considered as a "quasi-judicial office" since he is in fact an officer of the Court 21 and exercises his judgment in the choice of courses of action to be taken favorable to his client. Thus, in the creation of lawyer-client relationship, there are rules, ethical conduct and duties that breathe life into it, among those, the fiduciary duty to his client which is of a very delicate, exacting and confidential character, requiring a very high degree of fidelity and good faith, 22 that is required by reason of necessity and public interest 23 based on the hypothesis that abstinence from seeking legal advice in a good cause is an evil which is fatal to the administration of justice. 24 It is also the strict sense of fidelity of a lawyer to his client that distinguishes him from any other professional in society. This conception is entrenched and embodies centuries of established and stable tradition. 25 In Stockton v. Ford, 26 the U. S. Supreme Court held: There are few of the business relations of life involving a higher trust and confidence than that of attorney and client, or generally speaking, one more honorably and faithfully discharged; few more anxiously guarded by the law, or governed by the sterner principles of morality and justice; and it is the duty of the court to administer them in a corresponding spirit, and to be watchful and industrious, to see that confidence thus reposed shall not be used to the detriment or prejudice of the rights of the party bestowing it. 27 In our jurisdiction, this privilege takes off from the old Code of Civil Procedure enacted by the Philippine Commission on August 7, 1901. Section 383 of the Code specifically "forbids counsel, without authority of his client to reveal any communication made by the client to him or his advice given thereon in the course of professional employment." 28 Passed on into various provisions of the Rules of Court, the attorney-client privilege, as currently worded provides: Sec. 24. xxx Disqualification by reason of privileged communication. The following persons cannot testify as to matters learned in confidence in the following cases: xxx xxx

An attorney cannot, without the consent of his client, be examined as to any communication made by the client to him, or his advice given thereon in the course of, or with a view to, professional employment, can an attorney's secretary, stenographer, or clerk be examined, without the consent of the client and his employer, concerning any fact the knowledge of which has been acquired in such capacity. 29 Further, Rule 138 of the Rules of Court states: Sec. 20. It is the duty of an attorney: (e) to maintain inviolate the confidence, and at every peril to himself, to preserve the secrets of his client, and to accept no compensation in connection with his client's business except from him or with his knowledge and approval. This duty is explicitly mandated in Canon 17 of the Code of Professional Responsibility which provides that: Canon 17. A lawyer owes fidelity to the cause of his client and he shall be mindful of the trust and confidence reposed in him. Canon 15 of the Canons of Professional Ethics also demands a lawyer's fidelity to client: The lawyers owes "entire devotion to the interest of the client, warm zeal in the maintenance and defense of his rights and the exertion of his utmost learning and ability," to the end that nothing be taken or be withheld from him, save by the rules of law, legally applied. No fear of judicial disfavor or public popularity should restrain him from the full discharge of his duty. In the judicial forum the client is entitled to the benefit of any and every remedy and defense that is authorized by the law of the land, and he may expect his lawyer to assert every such remedy or defense. But it is steadfastly to be borne in mind that the great trust of the lawyer is to be

23
performed within and not without the bounds of the law. The office of attorney does not permit, much less does it demand of him for any client, violation of law or any manner of fraud or chicanery. He must obey his own conscience and not that of his client. Considerations favoring confidentially in lawyer-client relationships are many and serve several constitutional and policy concerns. In the constitutional sphere, the privilege gives flesh to one of the most sacrosanct rights available to the accused, the right to counsel. If a client were made to choose between legal representation without effective communication and disclosure and legal representation with all his secrets revealed then he might be compelled, in some instances, to either opt to stay away from the judicial system or to lose the right to counsel. If the price of disclosure is too high, or if it amounts to self incrimination, then the flow of information would be curtailed thereby rendering the right practically nugatory. The threat this represents against another sacrosanct individual right, the right to be presumed innocent is at once self-evident. Encouraging full disclosure to a lawyer by one seeking legal services opens the door to a whole spectrum of legal options which would otherwise be circumscribed by limited information engendered by a fear of disclosure. An effective lawyer-client relationship is largely dependent upon the degree of confidence which exists between lawyer and client which in turn requires a situation which encourages a dynamic and fruitful exchange and flow of information. It necessarily follows that in order to attain effective representation, the lawyer must invoke the privilege not as a matter of option but as a matter of duty and professional responsibility. The question now arises whether or not this duty may be asserted in refusing to disclose the name of petitioners' client(s) in the case at bar. Under the facts and circumstances obtaining in the instant case, the answer must be in the affirmative. As a matter of public policy, a client's identity should not be shrouded in mystery 30 Under this premise, the general rule in our jurisdiction as well as in the United States is that a lawyer may not invoke the privilege and refuse to divulge the name or identity of this client. 31 The reasons advanced for the general rule are well established. First, the court has a right to know that the client whose privileged information is sought to be protected is flesh and blood. Second, the privilege begins to exist only after the attorney-client relationship has been established. The attorney-client privilege does not attach until there is a client. Third, the privilege generally pertains to the subject matter of the relationship. Finally, due process considerations require that the opposing party should, as a general rule, know his adversary. "A party suing or sued is entitled to know who his opponent is." 32 He cannot be obliged to grope in the dark against unknown forces. 33 Notwithstanding these considerations, the general rule is however qualified by some important exceptions. 1) Client identity is privileged where a strong probability exists that revealing the client's name would implicate that client in the very activity for which he sought the lawyer's advice. In Ex-Parte Enzor, 34 a state supreme court reversed a lower court order requiring a lawyer to divulge the name of her client on the ground that the subject matter of the relationship was so closely related to the issue of the client's identity that the privilege actually attached to both. In Enzor, the unidentified client, an election official, informed his attorney in confidence that he had been offered a bribe to violate election laws or that he had accepted a bribe to that end. In her testimony, the attorney revealed that she had advised her client to count the votes correctly, but averred that she could not remember whether her client had been, in fact, bribed. The lawyer was cited for contempt for her refusal to reveal his client's identity before a grand jury. Reversing the lower court's contempt orders, the state supreme court held that under the circumstances of the case, and under the exceptions described above, even the name of the client was privileged. U .S. v. Hodge and Zweig, 35 involved the same exception, i.e. that client identity is privileged in those instances where a strong probability exists that the disclosure of the client's identity would implicate the client in the very criminal activity for which the lawyer's legal advice was obtained. The Hodge case involved federal grand jury proceedings inquiring into the activities of the "Sandino Gang," a gang involved in the illegal importation of drugs in the United States. The respondents, law partners, represented key witnesses and suspects including the leader of the gang, Joe Sandino. In connection with a tax investigation in November of 1973, the IRS issued summons to Hodge and Zweig, requiring them to produce documents and information regarding payment received by Sandino on behalf of any other person, and vice versa. The lawyers refused to divulge the names. The Ninth Circuit of the United States Court of Appeals, upholding non-disclosure under the facts and circumstances of the case, held: A client's identity and the nature of that client's fee arrangements may be privileged where the person invoking the privilege can show that a strong probability exists that disclosure of such information would implicate that client in the very criminal activity for which legal advice was sought Baird v. Koerner, 279 F. 2d at 680. While in Baird Owe enunciated this rule as a matter of California law, the rule also reflects federal law. Appellants contend that the Baird exception applies to this case. The Baird exception is entirely consonant with the principal policy behind the attorney-client privilege. "In order to promote freedom of consultation of legal advisors by clients, the apprehension of compelled disclosure from the legal advisors must be removed; hence, the law must prohibit such disclosure except on the client's consent." 8 J. Wigmore, supra sec. 2291, at 545. In furtherance of this policy, the client's identity and the nature of his fee arrangements are, in exceptional cases, protected as confidential communications. 36 2) Where disclosure would open the client to civil liability; his identity is privileged. For instance, the peculiar facts and circumstances of Neugass v. Terminal Cab Corporation, 37 prompted the New York Supreme Court to allow a lawyer's claim to the effect that he could not reveal the name of his client because this would expose the latter to civil litigation. In the said case, Neugass, the plaintiff, suffered injury when the taxicab she was riding, owned by respondent corporation, collided with a second taxicab, whose owner was unknown. Plaintiff brought action both against defendant corporation and the owner of the second cab, identified in the information only as John Doe. It turned out that when the attorney of defendant corporation appeared on preliminary examination, the fact was somehow revealed that the lawyer came to know the name of the owner of the second cab when a man, a client of the insurance company, prior to the institution of legal action, came to him and reported that he was involved in a car accident. It was apparent under the circumstances that the man was the owner of the second cab. The state supreme court held that the reports were clearly made to the lawyer in his professional capacity. The court said: That his employment came about through the fact that the insurance company had hired him to defend its policyholders seems immaterial. The attorney is such cases is clearly the attorney for the policyholder when the policyholder goes to him to report an occurrence contemplating that it would be used in an action or claim against him. 38

24
xxx xxx xxx

All communications made by a client to his counsel, for the purpose of professional advice or assistance, are privileged, whether they relate to a suit pending or contemplated, or to any other matter proper for such advice or aid; . . . And whenever the communication made, relates to a matter so connected with the employment as attorney or counsel as to afford presumption that it was the ground of the address by the client, then it is privileged from disclosure. . . It appears . . . that the name and address of the owner of the second cab came to the attorney in this case as a confidential communication. His client is not seeking to use the courts, and his address cannot be disclosed on that theory, nor is the present action pending against him as service of the summons on him has not been effected. The objections on which the court reserved decision are sustained. 39 In the case of Matter of Shawmut Mining Company, 40 the lawyer involved was required by a lower court to disclose whether he represented certain clients in a certain transaction. The purpose of the court's request was to determine whether the unnamed persons as interested parties were connected with the purchase of properties involved in the action. The lawyer refused and brought the question to the State Supreme Court. Upholding the lawyer's refusal to divulge the names of his clients the court held: If it can compel the witness to state, as directed by the order appealed from, that he represented certain persons in the purchase or sale of these mines, it has made progress in establishing by such evidence their version of the litigation. As already suggested, such testimony by the witness would compel him to disclose not only that he was attorney for certain people, but that, as the result of communications made to him in the course of such employment as such attorney, he knew that they were interested in certain transactions. We feel sure that under such conditions no case has ever gone to the length of compelling an attorney, at the instance of a hostile litigant, to disclose not only his retainer, but the nature of the transactions to which it related, when such information could be made the basis of a suit against his client. 41 3) Where the government's lawyers have no case against an attorney's client unless, by revealing the client's name, the said name would furnish the only link that would form the chain of testimony necessary to convict an individual of a crime, the client's name is privileged. In Baird vs. Korner, 42 a lawyer was consulted by the accountants and the lawyer of certain undisclosed taxpayers regarding steps to be taken to place the undisclosed taxpayers in a favorable position in case criminal charges were brought against them by the U.S. Internal Revenue Service (IRS). It appeared that the taxpayers' returns of previous years were probably incorrect and the taxes understated. The clients themselves were unsure about whether or not they violated tax laws and sought advice from Baird on the hypothetical possibility that they had. No investigation was then being undertaken by the IRS of the taxpayers. Subsequently, the attorney of the taxpayers delivered to Baird the sum of $12, 706.85, which had been previously assessed as the tax due, and another amount of money representing his fee for the advice given. Baird then sent a check for $12,706.85 to the IRS in Baltimore, Maryland, with a note explaining the payment, but without naming his clients. The IRS demanded that Baird identify the lawyers, accountants, and other clients involved. Baird refused on the ground that he did not know their names, and declined to name the attorney and accountants because this constituted privileged communication. A petition was filed for the enforcement of the IRS summons. For Baird's repeated refusal to name his clients he was found guilty of civil contempt. The Ninth Circuit Court of Appeals held that, a lawyer could not be forced to reveal the names of clients who employed him to pay sums of money to the government voluntarily in settlement of undetermined income taxes, unsued on, and with no government audit or investigation into that client's income tax liability pending. The court emphasized the exception that a client's name is privileged when so much has been revealed concerning the legal services rendered that the disclosure of the client's identity exposes him to possible investigation and sanction by government agencies. The Court held: The facts of the instant case bring it squarely within that exception to the general rule. Here money was received by the government, paid by persons who thereby admitted they had not paid a sufficient amount in income taxes some one or more years in the past. The names of the clients are useful to the government for but one purpose to ascertain which taxpayers think they were delinquent, so that it may check the records for that one year or several years. The voluntary nature of the payment indicates a belief by the taxpayers that more taxes or interest or penalties are due than the sum previously paid, if any. It indicates a feeling of guilt for nonpayment of taxes, though whether it is criminal guilt is undisclosed. But it may well be the link that could form the chain of testimony necessary to convict an individual of a federal crime. Certainly the payment and the feeling of guilt are the reasons the attorney here involved was employed to advise his clients what, under the circumstances, should be done. 43 Apart from these principal exceptions, there exist other situations which could qualify as exceptions to the general rule. For example, the content of any client communication to a lawyer lies within the privilege if it is relevant to the subject matter of the legal problem on which the client seeks legal assistance. 44 Moreover, where the nature of the attorney-client relationship has been previously disclosed and it is the identity which is intended to be confidential, the identity of the client has been held to be privileged, since such revelation would otherwise result in disclosure of the entire transaction. 45 Summarizing these exceptions, information relating to the identity of a client may fall within the ambit of the privilege when the client's name itself has an independent significance, such that disclosure would then reveal client confidences. 46 The circumstances involving the engagement of lawyers in the case at bench, therefore, clearly reveal that the instant case falls under at least two exceptions to the general rule. First, disclosure of the alleged client's name would lead to establish said client's connection with the very fact in issue of the case, which is privileged information, because the privilege, as stated earlier, protects the subject matter or the substance (without which there would be not attorney-client relationship). The link between the alleged criminal offense and the legal advice or legal service sought was duly establishes in the case at bar, by no less than the PCGG itself. The key lies in the three specific conditions laid down by the PCGG which constitutes petitioners' ticket to non-prosecution should they accede thereto: (a) (b) (c) the disclosure of the identity of its clients; submission of documents substantiating the lawyer-client relationship; and the submission of the deeds of assignment petitioners executed in favor of their clients covering their respective shareholdings.

From these conditions, particularly the third, we can readily deduce that the clients indeed consulted the petitioners, in their capacity as lawyers, regarding the financial and corporate structure, framework and set-up of the corporations in question. In turn, petitioners gave their professional advice in the form of, among others, the aforementioned deeds of assignment covering their client's shareholdings.

25
There is no question that the preparation of the aforestated documents was part and parcel of petitioners' legal service to their clients. More important, it constituted an integral part of their duties as lawyers. Petitioners, therefore, have a legitimate fear that identifying their clients would implicate them in the very activity for which legal advice had been sought, i.e., the alleged accumulation of ill-gotten wealth in the aforementioned corporations. Furthermore, under the third main exception, revelation of the client's name would obviously provide the necessary link for the prosecution to build its case, where none otherwise exists. It is the link, in the words of Baird, "that would inevitably form the chain of testimony necessary to convict the (client) of a . . . crime." 47 An important distinction must be made between a case where a client takes on the services of an attorney for illicit purposes, seeking advice about how to go around the law for the purpose of committing illegal activities and a case where a client thinks he might have previously committed something illegal and consults his attorney about it. The first case clearly does not fall within the privilege because the same cannot be invoked for purposes illegal. The second case falls within the exception because whether or not the act for which the client sought advice turns out to be illegal, his name cannot be used or disclosed if the disclosure leads to evidence, not yet in the hands of the prosecution, which might lead to possible action against him. These cases may be readily distinguished, because the privilege cannot be invoked or used as a shield for an illegal act, as in the first example; while the prosecution may not have a case against the client in the second example and cannot use the attorney client relationship to build up a case against the latter. The reason for the first rule is that it is not within the professional character of a lawyer to give advice on the commission of a crime. 48 The reason for the second has been stated in the cases above discussed and are founded on the same policy grounds for which the attorney-client privilege, in general, exists. In Matter of Shawmut Mining Co., supra, the appellate court therein stated that "under such conditions no case has ever yet gone to the length of compelling an attorney, at the instance of a hostile litigant, to disclose not only his retainer, but the nature of the transactions to which it related, when such information could be made the basis of a suit against his client." 49 "Communications made to an attorney in the course of any personal employment, relating to the subject thereof, and which may be supposed to be drawn out in consequence of the relation in which the parties stand to each other, are under the seal of confidence and entitled to protection as privileged communications." 50 Where the communicated information, which clearly falls within the privilege, would suggest possible criminal activity but there would be not much in the information known to the prosecution which would sustain a charge except that revealing the name of the client would open up other privileged information which would substantiate the prosecution's suspicions, then the client's identity is so inextricably linked to the subject matter itself that it falls within the protection. The Baird exception, applicable to the instant case, is consonant with the principal policy behind the privilege, i.e., that for the purpose of promoting freedom of consultation of legal advisors by clients, apprehension of compelled disclosure from attorneys must be eliminated. This exception has likewise been sustained in In re Grand Jury Proceedings 51 and Tillotson v. Boughner. 52 What these cases unanimously seek to avoid is the exploitation of the general rule in what may amount to a fishing expedition by the prosecution. There are, after all, alternative source of information available to the prosecutor which do not depend on utilizing a defendant's counsel as a convenient and readily available source of information in the building of a case against the latter. Compelling disclosure of the client's name in circumstances such as the one which exists in the case at bench amounts to sanctioning fishing expeditions by lazy prosecutors and litigants which we cannot and will not countenance. When the nature of the transaction would be revealed by disclosure of an attorney's retainer, such retainer is obviously protected by the privilege. 53 It follows that petitioner attorneys in the instant case owe their client(s) a duty and an obligation not to disclose the latter's identity which in turn requires them to invoke the privilege. In fine, the crux of petitioners' objections ultimately hinges on their expectation that if the prosecution has a case against their clients, the latter's case should be built upon evidence painstakingly gathered by them from their own sources and not from compelled testimony requiring them to reveal the name of their clients, information which unavoidably reveals much about the nature of the transaction which may or may not be illegal. The logical nexus between name and nature of transaction is so intimate in this case the it would be difficult to simply dissociate one from the other. In this sense, the name is as much "communication" as information revealed directly about the transaction in question itself, a communication which is clearly and distinctly privileged. A lawyer cannot reveal such communication without exposing himself to charges of violating a principle which forms the bulwark of the entire attorney-client relationship. The uberrimei fidei relationship between a lawyer and his client therefore imposes a strict liability for negligence on the former. The ethical duties owing to the client, including confidentiality, loyalty, competence, diligence as well as the responsibility to keep clients informed and protect their rights to make decisions have been zealously sustained. In Milbank, Tweed, Hadley and McCloy v. Boon, 54 the US Second District Court rejected the plea of the petitioner law firm that it breached its fiduciary duty to its client by helping the latter's former agent in closing a deal for the agent's benefit only after its client hesitated in proceeding with the transaction, thus causing no harm to its client. The Court instead ruled that breaches of a fiduciary relationship in any context comprise a special breed of cases that often loosen normally stringent requirements of causation and damages, and found in favor of the client. To the same effect is the ruling in Searcy, Denney, Scarola, Barnhart, and Shipley P.A. v. Scheller 55 requiring strict obligation of lawyers vis-a-vis clients. In this case, a contingent fee lawyer was fired shortly before the end of completion of his work, and sought payment quantum meruit of work done. The court, however, found that the lawyer was fired for cause after he sought to pressure his client into signing a new fee agreement while settlement negotiations were at a critical stage. While the client found a new lawyer during the interregnum, events forced the client to settle for less than what was originally offered. Reiterating the principle of fiduciary duty of lawyers to clients in Meinhard v. Salmon 56 famously attributed to Justice Benjamin Cardozo that "Not honesty alone, but the punctilio of an honor the most sensitive, is then the standard of behavior," the US Court found that the lawyer involved was fired for cause, thus deserved no attorney's fees at all. The utmost zeal given by Courts to the protection of the lawyer-client confidentiality privilege and lawyer's loyalty to his client is evident in the duration of the protection, which exists not only during the relationship, but extends even after the termination of the relationship. 57 Such are the unrelenting duties required by lawyers vis-a-vis their clients because the law, which the lawyers are sworn to uphold, in the words of Oliver Wendell Holmes, 58 ". . . is an exacting goddess, demanding of her votaries in intellectual and moral discipline." The Court, no less, is not prepared to accept respondents' position without denigrating the noble profession that is lawyering, so extolled by Justice Holmes in this wise: Every calling is great when greatly pursued. But what other gives such scope to realize the spontaneous energy of one's soul? In what other does one plunge so deep in the stream of life so share its passions its battles, its despair, its triumphs, both as witness and actor? . . . But that is not all. What a subject is this in which we are united this abstraction called the Law, wherein as in a magic mirror, we see reflected, not only in our lives, but the lives of all men that have been. When I think on this majestic theme my eyes dazzle. If we are to speak of the law as our mistress, we who are here know that she is a mistress only to be won with sustained and lonely passion only to be won by straining all the faculties by which man is likened to God. We have no choice but to uphold petitioners' right not to reveal the identity of their clients under pain of the breach of fiduciary duty owing to their clients, because the facts of the instant case clearly fall within recognized exceptions to the rule that the client's name is not privileged information. If we were to sustain respondent PCGG that the lawyer-client confidential privilege under the circumstances obtaining here does not cover the identity of the client, then it would expose the lawyers themselves to possible litigation by their clients in view of the strict fiduciary responsibility imposed on them in the exercise of their duties.

26
The complaint in Civil Case No. 0033 alleged that the defendants therein, including herein petitioners and Eduardo Cojuangco, Jr. conspired with each other in setting up through the use of coconut levy funds the financial and corporate framework and structures that led to the establishment of UCPB, UNICOM and others and that through insidious means and machinations, ACCRA, using its wholly-owned investment arm, ACCRA Investment Corporation, became the holder of approximately fifteen million shares representing roughly 3.3% of the total capital stock of UCPB as of 31 March 1987. The PCGG wanted to establish through the ACCRA lawyers that Mr. Cojuangco is their client and it was Cojuangco who furnished all the monies to the subscription payment; hence, petitioners acted as dummies, nominees and/or agents by allowing themselves, among others, to be used as instrument in accumulating ill-gotten wealth through government concessions, etc., which acts constitute gross abuse of official position and authority, flagrant breach of public trust, unjust enrichment, violation of the Constitution and laws of the Republic of the Philippines. By compelling petitioners, not only to reveal the identity of their clients, but worse, to submit to the PCGG documents substantiating the client-lawyer relationship, as well as deeds of assignment petitioners executed in favor of its clients covering their respective shareholdings, the PCGG would exact from petitioners a link "that would inevitably form the chain of testimony necessary to convict the (client) of a crime." III In response to petitioners' last assignment of error, respondents alleged that the private respondent was dropped as party defendant not only because of his admission that he acted merely as a nominee but also because of his undertaking to testify to such facts and circumstances "as the interest of truth may require, which includes . . . the identity of the principal." 59 First, as to the bare statement that private respondent merely acted as a lawyer and nominee, a statement made in his out-of-court settlement with the PCGG, it is sufficient to state that petitioners have likewise made the same claim not merely out-of-court but also in the Answer to plaintiff's Expanded Amended Complaint, signed by counsel, claiming that their acts were made in furtherance of "legitimate lawyering." 60 Being "similarly situated" in this regard, public respondents must show that there exist other conditions and circumstances which would warrant their treating the private respondent differently from petitioners in the case at bench in order to evade a violation of the equal protection clause of the Constitution. To this end, public respondents contend that the primary consideration behind their decision to sustain the PCGG's dropping of private respondent as a defendant was his promise to disclose the identities of the clients in question. However, respondents failed to show and absolute nothing exists in the records of the case at bar that private respondent actually revealed the identity of his client(s) to the PCGG. Since the undertaking happens to be the leitmotif of the entire arrangement between Mr. Roco and the PCGG, an undertaking which is so material as to have justified PCGG's special treatment exempting the private respondent from prosecution, respondent Sandiganbayan should have required proof of the undertaking more substantial than a "bare assertion" that private respondent did indeed comply with the undertaking. Instead, as manifested by the PCGG, only three documents were submitted for the purpose, two of which were mere requests for re-investigation and one simply disclosed certain clients which petitioners (ACCRA lawyers) were themselves willing to reveal. These were clients to whom both petitioners and private respondent rendered legal services while all of them were partners at ACCRA, and were not the clients which the PCGG wanted disclosed for the alleged questioned transactions. 61 To justify the dropping of the private respondent from the case or the filing of the suit in the respondent court without him, therefore, the PCGG should conclusively show that Mr. Roco was treated as species apart from the rest of the ACCRA lawyers on the basis of a classification which made substantial distinctions based on real differences. No such substantial distinctions exist from the records of the case at bench, in violation of the equal protection clause. The equal protection clause is a guarantee which provides a wall of protection against uneven application of status and regulations. In the broader sense, the guarantee operates against uneven application of legal norms so that all persons under similar circumstances would be accorded the same treatment. 62 Those who fall within a particular class ought to be treated alike not only as to privileges granted but also as to the liabilities imposed. . . . What is required under this constitutional guarantee is the uniform operation of legal norms so that all persons under similar circumstances would be accorded the same treatment both in the privileges conferred and the liabilities imposed. As was noted in a recent decision: "Favoritism and undue preference cannot be allowed. For the principle is that equal protection and security shall be given to every person under circumstances, which if not identical are analogous. If law be looked upon in terms of burden or charges, those that fall within a class should be treated in the same fashion, whatever restrictions cast on some in the group equally binding the rest. 63 We find that the condition precedent required by the respondent PCGG of the petitioners for their exclusion as parties-defendants in PCGG Case No. 33 violates the lawyer-client confidentiality privilege. The condition also constitutes a transgression by respondents Sandiganbayan and PCGG of the equal protection clause of the Constitution. 64 It is grossly unfair to exempt one similarly situated litigant from prosecution without allowing the same exemption to the others. Moreover, the PCGG's demand not only touches upon the question of the identity of their clients but also on documents related to the suspected transactions, not only in violation of the attorney-client privilege but also of the constitutional right against self-incrimination. Whichever way one looks at it, this is a fishing expedition, a free ride at the expense of such rights. An argument is advanced that the invocation by petitioners of the privilege of attorney-client confidentiality at this stage of the proceedings is premature and that they should wait until they are called to testify and examine as witnesses as to matters learned in confidence before they can raise their objections. But petitioners are not mere witnesses. They are co-principals in the case for recovery of alleged ill-gotten wealth. They have made their position clear from the very beginning that they are not willing to testify and they cannot be compelled to testify in view of their constitutional right against self-incrimination and of their fundamental legal right to maintain inviolate the privilege of attorney-client confidentiality. It is clear then that the case against petitioners should never be allowed to take its full course in the Sandiganbayan. Petitioners should not be made to suffer the effects of further litigation when it is obvious that their inclusion in the complaint arose from a privileged attorney-client relationship and as a means of coercing them to disclose the identities of their clients. To allow the case to continue with respect to them when this Court could nip the problem in the bud at this early opportunity would be to sanction an unjust situation which we should not here countenance. The case hangs as a real and palpable threat, a proverbial Sword of Damocles over petitioners' heads. It should not be allowed to continue a day longer. While we are aware of respondent PCGG's legal mandate to recover ill-gotten wealth, we will not sanction acts which violate the equal protection guarantee and the right against self-incrimination and subvert the lawyer-client confidentiality privilege. WHEREFORE, IN VIEW OF THE FOREGOING, the Resolutions of respondent Sandiganbayan (First Division) promulgated on March 18, 1992 and May 21, 1992 are hereby ANNULLED and SET ASIDE. Respondent Sandiganbayan is further ordered to exclude petitioners Teodoro D. Regala, Edgardo J. Angara, Avelino V. Cruz, Jose C. Concepcion, Victor P. Lazatin, Eduardo U. Escueta and Paraja G. Hayuduni as parties-defendants in SB Civil Case No. 0033 entitled "Republic of the Philippines v. Eduardo Cojuangco, Jr., et al."

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SO ORDERED. Separate Opinions VITUG, J., concurring: The legal profession, despite all the unrestrained calumny hurled against it, is still the noblest of professions. It exists upon the thesis that, in an orderly society that is opposed to all forms of anarchy, it so occupies, as it should, an exalted position in the proper dispensation of justice. In time, principles have evolved that would help ensure its effective ministration. The protection of confidentiality of the lawyer-client relationship is one, and it has since been an accepted firmament in the profession. It allows the lawyer and the client to institutionalize a unique relationship based on full trust and confidence essential in a justice system that works on the basis of substantive and procedural due process. To be sure, the rule is not without its pitfalls, and demands against it may be strong, but these problems are, in the ultimate analysis, no more than mere tests of vigor that have made and will make that rule endure. I see in the case before us, given the attendant circumstances already detailed in the ponencia, a situation of the Republic attempting to establish a case not on what it perceives to be the strength of its own evidence but on what it could elicit from a counsel against his client. I find it unreasonable for the Sandiganbayan to compel petitioners to breach the trust reposed on them and succumb to a thinly disguised threat of incrimination. Accordingly, I join my other colleague who vote for the GRANT of the petition. DAVIDE, JR., J.: dissenting The impressive presentation of the case in the ponencia of Mr. Justice Kapunan makes difficult the espousal of a dissenting view. Nevertheless, I do not hesitate to express that view because I strongly feel that this Court must confine itself to the key issue in this special civil action for certiorari, viz., whether or not the Sandiganbayan acted with grave abuse of discretion in not excluding the defendants, the petitioners herein, from the Third Amended Complaint in Civil Case No. 0033. That issue, unfortunately, has been simply buried under the avalanche of authorities upholding the sanctity of lawyer-client relationship which appears to me to be prematurely invoked. From the undisputed facts disclosed by the pleadings and summarized in the ponencia, I cannot find my way clear to a conclusion that the Sandiganbayan committed grave abuse of discretion in not acting favorably on the petitioners' prayer in their Comment to the PCGG's Motion to Admit Third Amended Complaint. The prerogative to determine who shall be made defendants in a civil case is initially vested in the plaintiff, or the PCGG in this case. The control of the Court comes in only when the issue of "interest" ( 2, Rule 3, Rules of Court) as, e.g., whether an indispensable party has not been joined, or whether there is a misjoinder of parties ( 7, 8, and 9, Id.), is raised. In the case below, the PCGG decided to drop or exclude from the complaint original co-defendant Raul Roco because he had allegedly complied with the condition prescribed by the PCGG, viz., undertake that he will reveal the identity of the principals for whom he acted as nominee/stockholder in the companies involved in PCGG Case No. 0033. In short, there was an agreement or compromise settlement between the PCGG and Roco. Accordingly, the PCGG submitted a Third Amended Complaint without Roco as a defendant. No obstacle to such an agreement has been insinuated. If Roco's revelation violated the confidentiality of a lawyer-client relationship, he would be solely answerable therefor to his principals/clients and, probably, to this Court in an appropriate disciplinary action if warranted. There is at all no showing that Civil Case No. 0033 cannot further be proceeded upon or that any judgment therein cannot be binding without Roco remaining as a defendant. Accordingly, the admission of the Third Amended Complaint cannot be validly withheld by the Sandiganbayan. Are the petitioners, who did not file a formal motion to be excluded but only made the request to that effect as a rider to their Comment to the Motion to Admit Third Amended Complaint, entitled to be excluded from the Third Amended Complaint such that denial thereof would constitute grave abuse of discretion on the Sandiganbayan's part? To me, the answer is clearly in the negative. The petitioners seek to be accorded the same benefit granted to or to be similarly treated as Roco. Reason and logic dictate that they cannot, unless they too would make themselves like Roco. Otherwise stated, they must first voluntarily adopt for themselves the factual milieu created by Roco and must bind themselves to perform certain obligations as Roco. It is precisely for this that in response to the petitioners' comment on the aforementioned Motion to Admit Third Amended Complaint the PCGG manifested that it is willing to accord the petitioners the treatment it gave Roco provided they would do what Roco had done, that is, disclose the identity of their principals/clients and submit documents substantiating their claimed lawyer-client relationship with the said principals/clients, as well as copies of deeds of assignments the petitioners executed in favor of their principals/clients. The petitioners did not do so because they believed that compliance thereof would breach the sanctity of their fiduciary duty in a lawyer-client relationship. It, indeed, appears that Roco has complied with his obligation as a consideration for his exclusion from the Third Amended Complaint. The Sandiganbayan found that 5. The PCGG is satisfied that defendant Roco has demonstrated his agency and that Roco has apparently identified his principal, which revelation could show the lack of action against him. This in turn has allowed the PCGG to exercise its power both under the rules of agency and under Section 5 of E.O. No. 14-1 in relation to the Supreme Court's ruling in Republic v. Sandiganbayan (173 SCRA 72). As a matter of fact, the PCGG presented evidence to substantiate Roco's compliance. The ponencia itself so stated, thus: . . . respondent PCGG presented evidence to substantiate compliance by private respondent Roco of the conditions precedent to warrant the latter's exclusion as partydefendant in PCGG Case No. 33, to wit: (a) Letter to respondent PCGG of the counsel of respondent Roco dated May 24, 1989 reiterating a previous request for reinvestigation by the PCGG in PCGG Case No. 33; (b) Affidavit dated March 8, 1989 executed by private respondent Roco as Attachment to the letter aforestated in (a); and (c) Letter of Roco, Bunag, and Kapunan Law Offices dated September 21, 1988 to the respondent in behalf of private respondent Roco originally requesting the reinvestigation and/or re-examination of evidence by the PCGG it Complaint in PCGG Case No. 33. (Id., 5-6). These are the pieces of evidence upon which the Sandiganbayan founded its conclusion that the PCGG was satisfied with Roco's compliance. The petitioners have not assailed such finding as arbitrary. The ponencia's observation then that Roco did not refute the petitioners' contention that he did not comply with his obligation to disclose the identity of his principals is entirely irrelevant. In view of their adamantine position, the petitioners did not, therefore, allow themselves to be like Roco. They cannot claim the same treatment, much less compel the PCGG to drop them as defendants, for nothing whatsoever. They have no right to make such a demand for until they shall have complied with the conditions imposed for their exclusion, they cannot be excluded except by way of a motion to dismiss based on the grounds allowed by law (e.g., those enumerated in 1, Rule 16, Rules of Court). The rule of confidentiality under the lawyer-client relationship is not a cause to exclude a party. It is merely aground for disqualification of a witness ( 24, Rule

28
130, Rules of Court) and may only be invoked at the appropriate time, i.e., when a lawyer is under compulsion to answer as witness, as when, having taken the witness stand, he is questioned as to such confidential communicator or advice, or is being otherwise judicially coerced to produce, through subpoena duces tecum or otherwise, letters or other documents containing the same privileged matter. But none of the lawyers in this case is being required to testify about or otherwise reveal "any [confidential] communication made by the client to him, or his advice given thereon in the course of, or with a view to, professional employment." What they are being asked to do, in line with their claim that they had done the acts ascribed to them in pursuance of their professional relation to their clients, is to identify the latter to the PCGG and the Court; but this, only if they so choose in order to be dropped from the complaint, such identification being the condition under which the PCGG has expressed willingness to exclude them from the action. The revelation is entirely optional, discretionary, on their part. The attorney-client privilege is not therefor applicable. Thus, the Sandiganbayan did not commit any abuse of discretion when it denied the petitioners' prayer for their exclusion as party-defendants because they did not want to abide with any of the conditions set by the PCGG. There would have been abuse if the Sandiganbayan granted the prayer because then it would have capriciously, whimsically, arbitrarily, and oppressively imposed its will on the PCGG. Again, what the petitioners want is their exclusion from the Third Amended Complaint or the dismissal of the case insofar as they are concerned because either they are invested with immunity under the principle of confidentiality in a lawyer-client relationship, or the claims against them in Civil Case No. 0033 are barred by such principle. Even if we have to accommodate this issue, I still submit that the lawyer-client privilege provides the petitioners no refuge. They are sued as principal defendants in Civil Case No. 0033, a case of the recovery of alleged ill-gotten wealth. Conspiracy is imputed to the petitioners therein. In short, they are, allegedly, conspirators in the commission of the acts complained of for being nominees of certain parties. Their inclusion as defendants in justified under 15, Article XI of the Constitution which provides that the right of the State to recover properties unlawfully acquired by public officials or employees, from them or from their nominees or transferees, shall not be barred by prescription, laches or estoppel and E.O. No. 1 of 28 February 1986, E.O. No. 2 of 12 March 1986, E.O. No. 14 of 7 May 1986, and the Rules and Regulations of the PCGG. Furthermore, 2, Rule 110 of the Rules of Court requires that the complaint or information should be "against all persons who appear to be responsible for the offense involved." Hypothetically admitting the allegations in the complaint in Civil Case No. 0033, I find myself unable to agree with the majority opinion that the petitioners are immune from suit or that they have to be excluded as defendants, or that they cannot be compelled to reveal or disclose the identity of their principals, all because of the sacred lawyer-client privilege. This privilege is well put in Rule 130 of the Rules of Court, to wit: 24. xxx Disqualification by reason of privileged communication. The following persons cannot testify as to matters learned in confidence in the following cases: xxx xxx

(b) An attorney cannot, without the consent of his client, be examined as to any communication made by the client to him, or his advice given thereon in the course of, or with a view to, professional employment, nor can an attorney's secretary, stenographer, or clerk be examined, without the consent of the client and his employer, concerning any fact the knowledge of which has been acquired in such capacity. The majority seeks to expand the scope of the Philippine rule on the lawyer-client privilege by copious citations of American jurisprudence which includes in the privilege the identity of the client under the exceptional situations narrated therein. From the plethora of cases cited, two facts stand out in bold relief. Firstly, the issue of privilege contested therein arose in grand jury proceedings on different States, which are preliminary proceedings before the filing of the case in court, and we are not even told what evidentiary rules apply in the said hearings. In the present case, the privilege is invoked in the court where it was already filed and presently pends, and we have the foregoing specific rules above-quoted. Secondly, and more important, in the cases cited by the majority, the lawyers concerned were merely advocating the cause of their clients but were not indicted for the charges against their said clients. Here, the counsel themselves are co-defendants duly charged in court as coconspirators in the offenses charged. The cases cited by the majority evidently do not apply to them. Hence, I wish to repeat and underscore the fact that the lawyer-client privilege is not a shield for the commission of a crime or against the prosecution of the lawyer therefor. I quote, with emphases supplied, from 81 AM JUR 2d, Witnesses, 393 to 395, pages 356-357: 393. Effect of unlawful purpose.

The existence of an unlawful purpose prevents the attorney-client privilege from attaching. The attorney-client privilege does not generally exist where the representation is sought to further criminal or fraudulent conduct either past, present, or future. Thus, a confidence received by an attorney in order to advance a criminal or fraudulent purpose is beyond the scope of the privilege. Observation: The common-law rule that the privilege protecting confidential communications between attorney and client is lost if the relation is abused by a client who seeks legal assistance to perpetrate a crime or fraud has been codified. 394. Attorney participation.

The attorney-client privilege cannot be used to protect a client in the perpetration of a crime in concert with the attorney, even where the attorney is not aware of his client's purpose. The reason for the rule is that it is not within the professional character of a lawyer to give advised on the commission of crime. Professional responsibility does not countenance the use of the attorney-client privilege as a subterfuge, and all conspiracies, either active or passive, which are calculated to hinder the administration of justice will vitiate the privilege. In some jurisdictions, however, this exception to the rule of privilege in confined to such intended acts in violation of the law as are mala in se, as distinguished from those which are merely mala prohibita. 395. Communication in contemplation of crime.

Communications between attorney and client having to do with the client's contemplated criminal acts, or in aid or furtherance thereof, are not covered by the cloak of privilege ordinarily existing in reference to communications between attorney and client. But, the mere charge of illegality, not supported by evidence, will not defeat the privilege; there must be at least prima facie evidence that the illegality has some foundation in fact. Underhill also states:

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There are many other cases to the same effect, for the rule is prostitution of the honorable relation of attorney and client will not be permitted under the guise of privilege, and every communication made to an attorney by a client for a criminal purpose is a conspiracy or attempt at a conspiracy which is not only lawful to divulge, but which the attorney under certain circumstances may be bound to disclose at once in the interest of justice. In accordance with this rule, where a forged will or other false instrument has come into possession of an attorney through the instrumentality of the accused, with the hope and expectation that the attorney would take some action in reference thereto, and the attorney does act, in ignorance of the true character of the instrument, there is no privilege, inasmuch as full confidence has been withheld. The attorney is then compelled to produce a forged writing against the client. The fact that the attorney is not cognizant of the criminal or wrongful purpose, or, knowing it, attempts to dissuade his client, is immaterial. The attorney's ignorance of his client's intentions deprives the information of a professional character as full confidence has been withheld. (H.C. Underhill, A Treatise on the Law of Criminal Case Evidence, vol. 2, Fifth ed. (1956), Sec. 332, pp. 836-837; emphasis mine). 125 AMERICAN LAW REPORTS ANNOTATED, 516-519, summarizes the rationale of the rule excepting communications with respect to contemplated criminal or fraudulent acts, thus: c. Rationale of rule excepting communications with respect to contemplated criminal or fraudulent act.

Various reasons have been announced as being the foundation for the holdings that communications with respect to contemplated criminal or fraudulent acts are not privileged. The reason perhaps most frequently advanced is that in such cases there is no professional employment, properly speaking. Standard F. Ins. Co v. Smithhart (1919) 183 Ky 679, 211 SW. 441, 5 ALR 972; Cummings v. Com. (1927) 221 Ky 301, 298 SW 943; Strong v. Abner (1937) 268 Ky 502, 105 SW(2d) 599; People v. Van Alstine (1885) 57 Mich 69, 23 NW 594; Hamil & Co. v. England (1892) 50 Mo App 338; Carney v. United R. Co. (1920) 205 Mo App 495, 226 SW 308; Matthews v. Hoagland (1891) 48 NJ Eq 455, 21 A 1054; Covency v. Tannahill (1841) 1 Hill (NY) 33, 37 AM Dec 287; People ex rel. Vogelstein v. Warden (1934) 150 Misc 714, 270 NYS 362 (affirmed without opinion in (1934) 242 App Div 611, 271 NYS 1059); Russell v. Jackson (1851) 9 Hare 387, 68 Eng Reprint 558; Charlton v. Coombes (1863) 4 Giff 372, 66 Eng Reprint 751; Reg. v. Cox (1884) LR 14 QB Div (Eng) 153 CCR; Re Postlethwaite (1887) LR 35 Ch Div (Eng) 722. In Reg. v. Cox (1884) LR 14 QB Div (Eng) 153 CCR, the court said: "In order that the rule may apply, there must be both professional confidence and professional employment, but if the client has a criminal object in view in his communications with his solicitor one of these elements must necessarily be absent. The client must either conspire with his solicitor or deceive him. If his criminal object is avowed, the client does not consult his adviser professionally, because it cannot be the solicitor's business to further any criminal object. If the client does not avow his object, he reposes no confidence, for the state of facts which is the foundation of the supposed confidence does not exist. The solicitor's advice is obtained by a fraud." So, in Standard F. Ins. Co. v. Smithhart (1919) 183 Ky 679, 211 SW 441, 5 ALR 972, the court said: "The reason of the principle which holds such communications not to be privileged is that it is not within the professional character of a lawyer to give advice upon such subjects, and that it is no part of the profession of an attorney or counselor at law to be advising persons as to how they may commit crimes or frauds, or how they may escape the consequences of contemplated crimes and frauds. If the crime or fraud has already been committed and finished, a client may advise with an attorney in regard to it, and communicate with him freely, and the communications cannot be divulged as evidence without the consent of the client, because it is a part of the business and duty of those engaged in the practice of the profession of law, when employed and relied upon for that purpose, to give advice to those who have made infractions of the laws; and, to enable the attorney to properly advise and to properly represent the client in court or when prosecutions are threatened, it is conducive to the administration of justice that the client shall be free to communicate to his attorney all the facts within his knowledge, and that he may be assured that a communication made by him shall not be used to his prejudice." The protection which the law affords to communications between attorney and client has reference to those which are legitimately and properly within the scope of a lawful employment, and does not extend to communications made in contemplation of a crime, or perpetration of a fraud. Strong v. Abner (1937) 368 Ky 502, 105 SW (2d) 599. The court in People v. Van Alstine (1885) 57 Mich 69, 23 NW 594, in holding not privileged communications to an attorney having for their object the communication of a crime, said: "They then partake of the nature of a conspiracy, or attempted conspiracy, and it is not only lawful to divulge such communications, but under certain circumstances it might become the duty of the attorney to do so. The interests of public justice require that no such shield from merited exposure shall be interposed to protect a person who takes counsel how he can safely commit a crime. The relation of attorney and client cannot exist for the purpose of counsel in concocting crimes." And in Coveney v. Tannahill (1841) 1 Hill (NY) 33, 37 Am Dec 287, the court was of the opinion that there could be no such relation as that of attorney and client, either in the commission of a crime, or in the doing of a wrong by force or fraud to an individual, the privileged relation of attorney and client existing only for lawful and honest purposes. If the client consults the attorney at law with reference to the perpetration of a crime, and they co-operate in effecting it, there is no privilege, inasmuch as it is no part of the lawyer's duty to aid in crime he ceases to be counsel and becomes a criminal. Matthews v. Hoagland (1891) 48 NJ Eq 455, 21 A 1054. The court cannot permit it to be said that the contriving of a fraud forms part of the professional business of an attorney or solicitor. Charlton v. Coombes (1863) 4 Giff 372, 66 Eng Reprint 751. If the client does not frankly and freely reveal his object and intention as well as facts, there is not professional confidence, and therefore no privilege. Matthews v. Hoagland (NJ) supra. See to the same effect Carney v. United R. Co. (1920) 205 Mo App 495, 226 SW 308. There is no valid claim of privilege in regard to the production of documents passing between solicitor and client, when the transaction impeached is charged to be based upon fraud, that is the matter to be investigated, and it is thought better that the alleged privilege should suffer than that honestly and fair dealing should appear to be violated with impunity. Smith v. Hunt (1901) 1 Ont L Rep 334. In Tichborne v. Lushington, shorthand Notes (Eng) p. 5211 (cited in Reg. v. Cox (1884) LR 14 QB Div (Eng) 172 CCR), the chief justice said "I believe the law is, and properly is, that if a party consults an attorney, and obtains advice for what afterwards turns out to be the commission of a crime or a fraud, that party so consulting the attorney has no privilege whatever to close the lips of the attorney from stating the truth. Indeed, if any such privilege should be contended for, or existing, it would work most grievous hardship on an attorney, who, after he had been consulted upon what subsequently appeared to be a manifest crime and fraud, would have his lips closed, and might place him in a very serious position of being suspected to be a party to the fraud, and without his having an opportunity of exculpating himself . . . There is no privilege in the case which I have suggested of a party consulting another, a professional man, as to what may afterwards turn out to be a crime or fraud, and the best mode of accomplishing it." In Garside v. Outram (1856) 3 Jur NS (Eng) 39, although the question of privilege as to communications between attorney and client was not involved, the question directly involved being the competency of a clerk in a business establishment to testify as to certain information which he acquired while working in the establishment, the court strongly approved of a view as stated arguendo for plaintiff, in Annesley v. Anglesea (1743) 17 How St Tr (Eng) 1229, as follows: "I shall claim leave to

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consider whether an attorney may be examined as to any matter which came to his knowledge as an attorney. If he is employed as an attorney in any unlawful or wicked act, his duty to the public obliges him to disclose it; no private obligations can dispense with that universal one which lies on every member of society to discover every design which may be formed, contrary to the laws of society, to destroy the public welfare. For this reason, I apprehend that if a secret which is contrary to the public good, such as a design to commit treason, murder, or perjury, comes to the knowledge of an attorney, even in a cause where he is concerned, the obligation to the public must dispense with the private obligation to the client." The court in McMannus v. State (1858) 2 Head (Tenn) 213, said; "It would be monstrous to hold that if counsel was asked and obtained in reference to a contemplated crime that the lips of the attorney would be sealed, when the facts might become important to the ends of justice in the prosecution of crime. In such a case the relation cannot be taken to exist. Public policy would forbid it." And the court in Lanum v. Patterson (1909) 151 Ill App 36, observed that this rule was not in contravention of sound public policy, but on the contrary, tended to the maintenance of a higher standard of professional ethics by preventing the relation of attorney and client from operating as a cloak for fraud. Communications of a client to an attorney are not privileged if they were a request for advice as to how to commit a fraud, it being in such a case not only the attorney's privilege, but his duty, to disclose the facts to the court. Will v. Tornabells & Co. (1907) 3 Porto Rico Fed Rep 125. The court said: "We say this notwithstanding the comments of opposing counsel as to the indelicacy of his position because of his being now on the opposite side of the issue that arose as a consequence of the communication he testifies about, and is interested in the cause to the extent of a large contingent fee, as he confesses." The object of prohibiting the disclosure of confidential communications is to protect the client, and not to make the attorney an accomplice or permit him to aid in the commission of a crime. People vs. Petersen (1901) 60 App Div 118, NYS 941. The seal of personal confidence can never be used to cover a transaction which is in itself a crime. People v. Farmer (1909) 194 NY 251, 87 NE 457. As to disclosing the identity of a client, 81 AM JUR 2d, Witnesses, 410 and 411, pages 366-368, states: 410. Name or identity of client.

Disclosure of a client's identity is necessary proof of the existence of the attorney-client relationship and is not privileged information. Thus, the attorney-client privilege is inapplicable even though the information was communicated confidentially to the attorney in his professional capacity and, in some cases, in spite of the fact that the attorney may have been sworn to secrecy, where an inquiry is directed to an attorney as to the name or identity of his client. This general rule applies in criminal cases, as well as in civil actions. Where an undisclosed client is a party to an action, the opposing party has a right to know with whom he is contending or who the real party in interest is, if not the nominal adversary. 411. Disclosure of identity of client as breach of confidentiality.

The revelation of the identification of a client is not usually considered privileged, except where so much has been divulged with regard to to legal services rendered or the advice sought, that to reveal the client's name would be to disclose the whole relationship and confidential communications. However, even where the subject matter of the attorney-client relationship has already been revealed, the client's name has been deemed privileged. Where disclosure of the identity of a client might harm the client by being used against him under circumstances where there are no countervailing factors, then the identity is protected by the attorney-client privilege. In criminal proceedings, a client's name may be privileged if information already obtained by the tribunal, combined with the client's identity, might expose him to criminal prosecution for acts subsequent to, and because of, which he had sought the advice of his attorney. Although as a general rule, the identity of a defendant in a criminal prosecution is a matter of public record and, thus, not covered by the attorney-client privilege, where the attorney has surrendered to the authorities physical evidence in his possession by way of the attorney-client relationship, the state must prove the connection between the piece of physical evidence and the defendant without in any way relying on the testimony of the client's attorney who initially received the evidence and, thus, the attorney may not be called to the stand and asked to disclose the identity of the client. However, an attorney cannot refuse to reveal the identity of a person who asked him to deliver stolen property to the police department, whether a bona fide attorney-client relationship exists between them, inasmuch as the transaction was not a legal service or done in the attorney's professional capacity. Distinction: Where an attorney was informed by a male client that his female acquaintance was possibly involved in [a] his-and-run accident, the identity of the female did not come within scope of attorney-client privilege although the identity of the male client was protected. (emphases supplied) WIGMORE explains why the identity of a client is not within the lawyer-client privilege in this manner: 2313. Identity of client or purpose of suit. The identity of the attorney's client or the name of the real party in interest will seldom be a matter communicated in confidence because the procedure of litigation ordinarily presupposes a disclosure of these facts. Furthermore, so far as a client may in fact desire secrecy and may be able to secure action without appearing as a party to the proceedings, it would be improper to sanction such a wish. Every litigant is in justice entitled to know the identity of his opponents. He cannot be obliged to struggle in the dark against unknown forces. He has by anticipation the right, in later proceedings, if desired, to enforce the legal responsibility of those who may have maliciously sued or prosecuted him or fraudulently evaded his claim. He has as much right to ask the attorney "Who fees your fee?" as to ask the witness (966 supra). "Who maintains you during this trial?" upon the analogy of the principle already examined (2298 supra), the privilege cannot be used to evade a client's responsibility for the use of legal process. And if it is necessary for the purpose to make a plain exception to the rule of confidence, then it must be made. (Wigmore on Evidence, vol. 8, (1961), p. 609; emphases supplied). In 114 ALR, 1322, we also find the following statement: 1. Name or identity.

As is indicated in 28 R.C.L. p. 563, it appears that the rule making communications between attorney and client privileged from disclosure ordinarily does not apply where the inquiry is confined to the fact of the attorney's employment and the name of the person employing him, since the privilege presupposes the relationship of client and attorney, and therefore does not attach to its creation. At the present stage of the proceedings below, the petitioners have not shown that they are so situated with respect to their principals as to bring them within any of the exceptions established by American jurisprudence. There will be full opportunity for them to establish that fact at the trial where the broader perspectives of the case

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shall have been presented and can be better appreciated by the court. The insistence for their exclusion from the case is understandable, but the reasons for the hasty resolution desired is naturally suspect. We do not even have to go beyond our shores for an authority that the lawyer-client privilege cannot be invoked to prevent the disclosure of a client's identity where the lawyer and the client are conspirators in the commission of a crime or a fraud. Under our jurisdiction, lawyers are mandated not to counsel or abet activities aimed at defiance of the law or at lessening confidence in the legal system (Rule 1.02, Canon 1, Code of Professional Responsibility) and to employ only fair and honest means to attain the lawful objectives of his client (Rule 19.01, Canon 19, Id.). And under the Canons of Professional Ethics, a lawyer must steadfastly bear in mind that his great trust is to be performed within and not without the bounds of the law (Canon 15, Id.), that he advances the honor of his profession and the best interest of his client when he renders service or gives advice tending to impress upon the client and his undertaking exact compliance with the strictest principles of moral law (Canon 32, Id.). These canons strip a lawyer of the lawyer-client privilege whenever he conspires with the client in the commission of a crime or a fraud. I then vote to DENY, for want of merit, the instant petition. PUNO, J., dissenting: This is an important petition for certiorari to annul the resolutions of the respondent Sandiganbayan denying petitioners' motion to be excluded from the Complaint for recovery of alleged ill-gotten wealth on the principal ground that as lawyers they cannot be ordered to reveal the identity of their client. First, we fast forward the facts. The Presidential Commission on Good Government (PCGG) filed Civil Case No. 33 before the Sandiganbayan against Eduardo M. Cojuangco, Jr., for the recovery of alleged ill-gotten wealth. Sued as co-defendants are the petitioners in the cases at bar lawyers Teodoro Regala, Edgardo J. Angara, Avelino V. Cruz, Jose Concepcion, Rogelio A. Vinluan, Victor P. Lazatin, Eduardo Escueta and Paraja Hayudini. Also included as a co-defendant is lawyer Raul Roco, now a duly elected senator of the Republic. All co-defendants were then partners of the law firm, Angara, Abello, Concepcion, Regala and Cruz Law Offices, better known as the ACCRA Law Firm. The Complaint against Cojuangco, Jr., and the petitioners alleged, inter alia, viz: xxx xxx xxx

The wrongs committed by defendants acting singly or collectively and in unlawful concert with one another, include the misappropriation and theft of public funds, plunder of the nation's wealth, extortion, blackmail, bribery, embezzlement and other acts of corruption, betrayal of public trust and brazen abuse of power as more fully described (in the subsequent paragraphs of the complaint), all at the expense and to the grave and irreparable damage of Plaintiff and the Filipino people. Defendants Eduardo Cojuangco, Jr., Edgardo J. Angara, Jose C. Concepcion, Teodoro D. Regala, Avelino V. Cruz, Regalio A. Vinluan, Eduardo U. Escueta, Paraja G. Hayudini and Raul S. Roco of Angara, Concepcion, Cruz, Regala, and Abello law offices (ACCRA) plotted, devised, schemed, conspired and confederated with each other in setting up, through the use of the coconut levy funds, the financial and corporate framework and structures that led to the establishment of UCPB, UNICOM, COCOLIFE, COCOMARK, CIC and more than twenty other coconut levy funded corporations, including the acquisition of the San Miguel Corporation shares and the institutionalization through presidential directives of the coconut monopoly. through insidious means and machinations, ACCRA, using its wholly-owned investment arm, ACCRA Investments Corporation, became the holder of approximately fifteen million shares representing roughly 3.3% of the total outstanding capital stock of UCPB as of 31 March 1987. This ranks ACCRA Investments Corporation number 44 among the top 100 biggest stockholders of UCPB which has approximately 1,400,000 shareholders. On the other hand, corporate books show the name Edgardo J. Angara as holding approximately 3,744 shares as of 7 June 1984. In their Answer, petitioners alleged that the legal services offered and made available by their firm to its clients include: (a) organizing and acquiring business organizations, (b) acting as incorporators or stockholders thereof, and (c) delivering to clients the corresponding documents of their equity holdings (i.e., certificates of stock endorsed in blank or blank deeds of trust or assignment). They claimed that their activities were "in furtherance of legitimate lawyering." In the course of the proceedings in the Sandiganbayan, the PCGG filed a Motion to Admit Third Amended Complaint and the Third Amended Complaint excluding lawyer Roco as party defendant. Lawyer Roco was excluded on the basis of his promise to reveal the identity of the principals for whom he acted as nominee/stockholder in the companies involved in the case. The Sandiganbayan ordered petitioners to comment on the motion. In their Comment, petitioners demanded that they be extended the same privilege as their codefendant Roco. They prayed for their exclusion from the complaint. PCGG agreed but set the following conditions: (1) disclosure of the identity of their client; (2) submission of documents substantiating their lawyer-client relationship; and (3) submission of the deeds of assignment petitioners executed in favor of their client covering their respective shareholdings. The same conditions were imposed on lawyer Roco. Petitioners refused to comply with the PCGG conditions contending that the attorney-client privilege gives them the right not to reveal the identity of their client. They also alleged that lawyer Roco was excluded though he did not in fact reveal the identity of his clients. On March 18, 1992, the Sandiganbayan denied the exclusion of petitioners in Case No. 33. It held: xxx xxx xxx

ACCRA lawyers may take the heroic stance of not revealing the identity of the client for whom they have acted, i.e., their principal, and that will be their choice. But until they do identify their clients, considerations of whether or not the privilege claimed by the ACCRA lawyers exists cannot even begin to the debated. The ACCRA lawyers cannot excuse themselves from the consequences of their acts until they have begun to establish the basis for recognizing the privilege; the existence and identity of the client. This is what appears to be the cause for which they have been impleaded by the PCGG as defendants herein. 5. The PCGG is satisfied that defendant Roco has demonstrated his agency and that Roco has apparently identified his principal, which revelation could show the lack of course against him. This in turn has allowed the PCGG to exercise its power both under the rules of Agency and under Section 5 of E.O. No. 14-A in relation to the Supreme Court's ruling in Republic v. Sandiganbayan (173 SCRA 72). The PCGG has apparently offered to the ACCRA lawyers the same conditions availed of by Roco; full disclosure in exchange for exclusion from these proceedings (par. 7, PCGG's COMMENT dated November 4, 1991). The ACCRA lawyers have preferred not to make the disclosures required by the PCGG. The ACCRA lawyers cannot, therefore, begrudge the PCGG for keeping them as a party defendants. In the same vein, they cannot compel the PCGG to be accorded the same treatment accorded to Roco. Neither can this Court.

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WHEREFORE, the Counter Motion dated October 8, 1991 filed by the ACCRA lawyers and joined in by Atty. Paraja G. Hayudini for the same treatment by the PCGG as accorded to Raul S. Roco is DENIED for lack of merit. Sandiganbayan later denied petitioners' motions for reconsideration in its resolutions dated May 21, 1988 and September 3, 1992. In this petition for certiorari, petitioners contend: I The Honorable Sandiganbayan gravely abused its discretion in subjecting petitioners ACCRA lawyers who indisputably acted as lawyers in serving as nomineestockholders, to the strict application of the law agency. II The Honorable Sandiganbayan committed grave abuse of discretion in not considering petitioners ACCRA lawyers and Mr. Roco as similarly situated and, therefore, deserving of equal treatment. 1. There is absolutely no evidence that Mr. Roco had revealed, or had undertaken to reveal, the identities of the client(s) for whom he acted as nomineestockholder. 2. Even assuming that Mr. Roco had revealed, or had undertaken to reveal, the identities of the client(s), the disclosure does not constitute a substantial distinction as would make the classification reasonable under the equal protection clause. 3. III The Honorable Sandiganbayan committed grave abuse of discretion in not holding that, under the facts of this case, the attorney-client privilege prohibits petitioners ACCRA lawyers from revealing the identity of their client(s) and the other information requested by the PCGG. 1. 2. matters. IV The Honorable Sandiganbayan committed grave abuse of discretion in not requiring that the dropping of party-defendants by the PCGG must be based on reasonable and just grounds and with due consideration to the constitutional right of petitioners ACCRA lawyers to the equal protection of the law. The petition at bar is atypical of the usual case where the hinge issue involves the applicability of attorney-client privilege. It ought to be noted that petitioners were included as defendants in Civil Case No. 33 as conspirators. Together with Mr. Cojuangco, Jr., they are charged with having ". . . conspired and confederated with each other in setting up, through the use of the coconut levy funds, the financial and corporate framework and structures that led to the establishment of UCPB, UNICOM, COCOLIFE, COCOMARK, CICI and more than twenty other coconut levy funded corporations, including the acquisition of San Miguel Corporation shares and the institutionalization through presidential directives of the coconut monopoly." To stress, petitioners are charged with having conspired in the commission of crimes. The issue of attorney-client privilege arose when PCGG agreed to exclude petitioners from the complaint on condition they reveal the identity of their client. Petitioners refused to comply and assailed the condition on the ground that to reveal the identity of their client will violate the attorney-client privilege. It is thus necessary to resolve whether the Sandiganbayan committed grave abuse of discretion when it rejected petitioners' thesis that to reveal the identity of their client would violate the attorney-client privilege. The attorney-client privilege is the oldest of the privileges for confidential communications known to the common law. 1 For the first time in this jurisdiction, we are asked to rule whether the attorney-client privilege includes the right not to disclose the identity of client. The issue poses a trilemma for its resolution requires the delicate balancing of three opposing policy considerations. One overriding policy consideration is the need for courts to discover the truth for truth alone is the true touchstone of justice. 2 Equally compelling is the need to protect the adversary system of justice where truth is best extracted by giving a client broad privilege to confide facts to his counsel. 3 Similarly deserving of sedulous concern is the need to keep inviolate the constitutional right against selfincrimination and the right to effective counsel in criminal litigations. To bridle at center the centrifugal forces of these policy considerations, courts have followed to prudential principle that the attorney-client privilege must not be expansively construed as it is in derogation of the search for truth. 4 Accordingly, a narrow construction has been given to the privilege and it has been consistently held that "these competing societal interests demand that application of the privilege not exceed that which is necessary to effect the policy considerations underlying the privilege, i.e., the privilege must be upheld only in those circumstances for which it was created.'" 5 Prescinding from these premises, our initial task is to define in clear strokes the substantive content of the attorney-client privilege within the context of the distinct issues posed by the petition at bar. With due respect, I like to start by stressing the irreducible principle that the attorney-client privilege can never be used as a shield to commit a crime or a fraud. Communications to an attorney having for their object the commission of a crime ". . . partake the nature of a conspiracy, and it is not only lawful to divulge such communications, but under certain circumstances it might become the duty of the attorney to do so. The interests of public justice require that no such shield from merited exposure shall be interposed to protect a person who takes counsel how he can safely commit a crime. The relation of attorney and client cannot exist for the purpose of counsel in concocting crimes." 6 In the well chosen words of retired Justice Quiason, a lawyer is not a gun for hire. 7 I hasten to add, however, that a mere allegation that a lawyer conspired with his client to commit a crime or a fraud will not defeat the privilege. 8 As early as 1933, no less than the Mr. Justice Cardozo held in Clark v. United States 9 that: "there are early cases apparently to the effect that a mere charge of illegality, not supported by any evidence, will set the confidences free . . . But this conception of the privilege is without support . . . To drive the privilege away, there must be 'something to give colour to the charge;' there must be prima facie evidence that it has foundation in fact." In the petition at bar, however, the PCGG appears to have relented on its original stance as spelled out in its Complaint that petitioners are co-conspirators in crimes and cannot invoke the attorney-client privilege. The PCGG has agreed to exclude petitioners from the Complaint provided they reveal the identity of their client. In fine, PCGG has conceded that petitioner are entitled to invoke the attorney-client privilege if they reveal their client's identity. Assuming then that petitioners can invoke the attorney-client privilege since the PCGG is no longer proceeding against them as co-conspirators in crimes, we should focus on the more specific issue of whether the attorney-client privilege includes the right not to divulge the identity of a client as contended by the petitioners. As a Under the peculiar facts of this case, the attorney-client privilege includes the identity of the client(s). The factual disclosures required by the PCGG are not limited to the identity of petitioners ACCRA lawyers' alleged client(s) but extend to other privileged Respondent Sandiganbayan sanctioned favoritism and undue preference in favor of Mr. Roco and violation of the equal protection clause.

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general rule, the attorney-client privilege does not include the right of non-disclosure of client identity. The general rule, however, admits of well-etched exceptions which the Sandiganbayan failed to recognize. The general rule and its exceptions are accurately summarized in In re Grand Jury Investigation, 10 viz: The federal forum is unanimously in accord with the general rule that the identity of a client is, with limited exceptions, not within the protective ambit of the attorneyclient privilege. See: In re Grand Jury Proceedings (Pavlick), 680 F.2d 1026, 1027 (5th Cir. 1982) (en banc); In re Grand Jury Proceedings (Jones), 517 F. 2d 666, 67071 (5th Cir. 1975); In re Grand Jury Proceedings (Fine), 651 F. 2d 199, 204 (5th Cir. 1981); Frank v. Tomlinson, 351 F.2d 384 (5th Cir. 1965), cert. denied, 382 U.S. 1082, 86 S.Ct. 648, 15 L.Ed.2d 540 (1966); In re Grand Jury Witness (Salas), 695 F.2d 359, 361 (9th Cir. 1982); In re Grand Jury Subpoenas Duces Tecum (Marger/Merenbach), 695 F.2d 363, 365 (9th Cir. 1982); In re Grand Jury Proceedings (Lawson), 600 F.2d 215, 218 (9th Cir. 1979). The Circuits have embraced various "exceptions" to the general rule that the identity of a client is not within the protective ambit of the attorney-client privilege. All such exceptions appear to be firmly grounded in the Ninth Circuit's seminal decision in Baird v. Koerner, 279 F.2d 633 (9th Cir. 1960). In Baird the IRS received a letter from an attorney stating that an enclosed check in the amount of $12,706 was being tendered for additional amounts due from undisclosed taxpayers. When the IRS summoned the attorney to ascertain the identity of the delinquent taxpayers the attorney refused identification assertion the attorney-client privilege. The Ninth Circuit, applying California law, adjudged that the "exception" to the general rule as pronounced in Ex parte McDonough, 170 Cal. 230, 149 P. 566 (1915) controlled: The name of the client will be considered privileged matter where the circumstances of the case are such that the name of the client is material only for the purpose of showing an acknowledgment of guilt on the part of such client of the very offenses on account of which the attorney was employed. Baird, supra, 279 F.2d at 633. The identity of the Baird taxpayer was adjudged within this exception to the general rule. The Ninth Circuit has continued to acknowledge this exception. A significant exception to this principle of non-confidentiality holds that such information may be privileged when the person invoking the privilege is able to show that a strong possibility exists that disclosure of the information would implicate the client in the very matter for which legal advice was sought in the first case. In re Grand Jury Subpoenas Duces Tecum (Marger/Merenbach), 695 F.2d 363, 365 (9th Cir. 1982). Accord: United States v. Hodge and Zweig, 548 F.2d 1347, 1353 (9th Cir. 1977); In re Grand Jury Proceedings (Lawson), 600 F.2d 215, 218 (9th Cir. 1979); United States v. Sherman, 627 F.2d 189, 190-91 (9th Cir. 1980); In re Grand Jury Witness (Salas), 695 F.2d 359, 361 (9th Cir. 1982). This exception, which can perhaps be most succinctly characterized as the "legal advice" exception, has also been recognized by other circuits. See: In re Walsh, 623 F.2d 489, 495 (7th Cir.), cert. denied, 449 U.S. 994, 101 S. Ct. 531, 66 L.Ed.2d 291 (1980); In re Grand Jury Investigation (Tinari), 631 F.2d 17, 19 (3d Cir 1980), cert. denied, 449 U.S.1083, 101 S.Ct. 869-70, 66 L.Ed.2d 808 (1981). Since the legal advice exception is firmly grounded in the policy of protecting confidential communications, this Court adopts and applies its principles herein. See: In re Grand Jury Subpoenas Duces Tecum (Marger/Merenbach), supra. It should be observed, however that the legal advice exception may be defeated through a prima facie showing that the legal representation was secured in furtherance of present or intended continuing illegality, as where the legal representation itself is part of a larger conspiracy. See: In re Grand Jury Subpoenas Decus Tecum (Marger/Merenbach), supra, 695 F.2d at 365 n. 1; In re Walsh, 623 F.2d 489, 495 (7th Cir.), cert. denied, 449, U.S. 994, 101 S.Ct. 531, 66 L.Ed. 2d 291 (1980); In re Grand Jury Investigation (Tinari), 631 F.2d 17, 19 (3d Cir 1980); cert. denied, 449 U.S. 1083, 101 S.Ct. 869, 66 L.Ed. 2d 808 (1981); In re Grand Jury Proceedings (Lawson), 600 F.2d 215, 218 (9th Cir. 1979); United States v. Friedman, 445 F.2d 1076, 1086 (9th Cir. 1971). See also: Clark v. United States, 289 U.S. 1, 15, 53, S.Ct. 465, 469, 77, L.Ed. 993 (1933); In re Grand Jury Proceedings (Pavlick), 680 F.2d 1026, 1028-29 (5th Cir. 1982 (en banc). Another exception to the general rule that the identity of a client is not privileged arises where disclosure of the identity would be tantamount to disclosing an otherwise protected confidential communication. In Baird, supra, the Ninth Circuit observed: If the identification of the client conveys information which ordinarily would be conceded to be part of the usual privileged communication between attorney and client, then the privilege should extend to such identification in the absence of another factors. Id., 279 F.2d at 632. Citing Baird, the Fourth Circuit promulgated the following exception: To the general rule is an exception, firmly embedded as the rule itself. The privilege may be recognized where so much of the actual communication has already been disclosed that identification of the client amounts to disclosure of a confidential communication. NLRB v. Harvey, 349 F.2d 900, 905 (4th Cir. 1965). Accord: United States v. Tratner, 511 F.2d 248, 252 (7th Cir. 1975); Colton v. United States, 306 F.2d 633, 637 (2d Cir. 1962), cert. denied, 371 U.S. 951, 83 S.Ct. 505, 9 L.Ed.2d 499 1963); Tillotson v. Boughner, 350 F.2d 663, 666 (7th Cir. 1965); United States v. Pape, 144 F.2d 778, 783 (2d Cir. 1944). See also: Chirac v. Reinecker, 24 U.S. (11 Wheat) 280, 6 L.Ed. 474 (1826). The Seventh Circuit has added to the Harvey exception the following emphasized caveat: The privilege may be recognized where so much of the actual communication has already been disclosed [not necessarily by the attorney, but by independent sources as well] that identification of the client [or of fees paid] amounts to disclosure of a confidential communication. United States vs. Jeffers, 532 F.2d 1101, 1115 (7th Cir. 1976 (emphasis added). The Third Circuit, applying this exception, has emphasized that it is the link between the client and the communication, rather than the link between the client and the possibility of potential criminal prosecution, which serves to bring the client's identity within the protective ambit of the attorney-client privilege. See: In re Grand Jury Empanelled February 14, 1978 (Markowitz), 603 F.2d 469, 473 n. 4 (3d Cir. 1979). Like the "legal advice" exception, this exception is also firmly rooted in principles of confidentiality. Another exception, articulated in the Fifth Circuit's en banc decision of In re Grand Jury Proceedings (Pavlick), 680 F.2d 1026 (5th Cir. 1982 (en banc), is recognized when disclosure of the identity of the client would provide the "last link" of evidence: We have long recognized the general rule that matters involving the payment of fees and the identity of clients are not generally privileged. In re Grand Jury Proceedings, (United States v. Jones), 517 F.2d 666 (5th Cir. 1975); see cases collected id. at 670 n. 2. There we also recognized, however, a limited and narrow exception to the general rule, one that obtains when the disclosure of the client's identity by his attorney would have supplied the last link in an existing chain of incriminating evidence likely to lead to the client's indictment. I join the majority in holding that the Sandiganbayan committed grave abuse of discretion when it misdelineated the metes and bounds of the attorney-client privilege by failing to recognize the exceptions discussed above. Be that as it may, I part ways with the majority when it ruled that petitioners need not prove they fall within the exceptions to the general rule. I respectfully submit that the attorney-client privilege is not a magic mantra whose invocation will ipso facto and ipso jure drape he who invokes it with its protection. Plainly put, it is not enough to assert the privilege. 11 The person claiming the privilege or its exceptions has the obligation to present the underlying facts demonstrating the existence of

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the privilege. 12 When these facts can be presented only by revealing the very information sought to be protected by the privilege, the procedure is for the lawyer to move for an inspection of the evidence in an in camera hearing. 13 The hearing can even be in camera and ex-parte. Thus, it has been held that "a well-recognized means for an attorney to demonstrate the existence of an exception to the general rule, while simultaneously preserving confidentiality of the identity of his client, is to move the court for an in camera ex-parte hearing. 14 Without the proofs adduced in these in camera hearings, the Court has no factual basis to determine whether petitioners fall within any of the exceptions to the general rule. In the case at bar, it cannot be gainsaid that petitioners have not adduced evidence that they fall within any of the above mentioned exceptions for as aforestated, the Sandiganbayan did not recognize the exceptions, hence, the order compelling them to reveal the identity of their client. In ruling that petitioners need not further establish the factual basis of their claim that they fall within the exceptions to the general rule, the majority held: The circumstances involving the engagement of lawyers in the case at bench therefore clearly reveal that the instant case falls under at least two exceptions to the general rule. First, disclosure of the alleged client's name would lead to establish said client's connection with the very fact in issue of the case, which is privileged information, because the privilege, as stated earlier, protects the subject matter or the substance (without which there would be no attorney-client relationship). Furthermore, under the third main exception, revelation of the client's name would obviously provide the necessary link for the prosecution to build its case, where none otherwise exists. It is the link, in the word of Baird, "that would inevitably form the chain of testimony necessary to convict the (client) of a . . . crime. I respectfully submit that the first and third exceptions relied upon by the majority are not self-executory but need factual basis for their successful invocation. The first exception as cited by the majority is ". . . where a strong probability exists that revealing the clients' name would implicate that client in the very activity for which he sought the lawyer's advice." It seems to me evident that "the very activity for which he sought the lawyer's advice" is a question of fact which must first be established before there can be any ruling that the exception can be invoked. The majority cites Ex Parte Enzor, 15 and U S v. Hodge and Zweig, 16 but these cases leave no doubt that the "very activity" for which the client sought the advice of counsel was properly proved. In both cases, the "very activity" of the clients reveal they sought advice on their criminal activities. Thus, in Enzor, the majority opinion states that the "unidentified client, an election official, informed his attorney in confidence that he had been offered a bribe to violate election laws or that he had accepted a bribe to that end." 17 In Hodge, the "very activity" of the clients deals with illegal importation of drugs. In the case at bar, there is no inkling whatsoever about the "very activity" for which the clients of petitioners sought their professional advice as lawyers. There is nothing in the records that petitioners were consulted on the "criminal activities" of their client. The complaint did allege that petitioners and their client conspired to commit crimes but allegations are not evidence. So it is with the third exception which as related by the majority is "where the government's lawyers have no case against an attorney's client unless, by revealing the client's name, the said name would furnish the only link that would form the chain of testimony necessary to convict an individual of a crime." 18 Again, the rhetorical questions that answer themselves are: (1) how can we determine that PCGG has "no case" against petitioners without presentation of evidence? and (2) how can we determine that the name of the client is the only link without presentation of evidence as to the other links? The case of Baird vs. Koerner 19 does not support the "no need for evidence" ruling of the majority. In Baird, as related by the majority itself, "a lawyer was consulted by the accountants and the lawyer of certain undisclosed taxpayers regarding steps to be taken to place the undisclosed taxpayers in a favorable position in case criminal charges were brought against them by the US Internal Revenue Service (IRS). It appeared that the taxpayers' returns of previous years were probably incorrect and the taxes understated. 20 Once more, it is clear that the Baird court was informed of the activity of the client for which the lawyer was consulted and the activity involved probable violation of the tax laws. Thus, the Court held: The facts of the instant case bring it squarely within that exception to the general rule. Here money was received by the government, paid by persons who thereby admitted they had not paid a sufficient amount in income taxes some one or more years in the past. The names of the clients are useful to the government for but one purpose to ascertain which taxpayers think they were delinquent, so that it may check the records for that one year or several years. The voluntary nature of the payment indicates a belief by the taxpayers that more tax or interest or penalties are due than the sum previously paid, if any. It indicates a feeling of guilt for nonpayment of taxes, though whether it is criminal guilt is undisclosed. But it may well be the link that could form the chain of testimony necessary to convict an individual of a federal crime. Certainly the payment and the feeling of guilt are the reasons the attorney here involved was employed to advise his clients what, under the circumstances, should be done. In fine, the factual basis for the ruling in Baird was properly established by the parties. In the case at bar, there is no evidence about the subject matter of the consultation made by petitioners' client. Again, the records do not show that the subject matter is criminal in character except for the raw allegations in the Complaint. Yet, this is the unstated predicate of the majority ruling that revealing the identity of the client ". . . would furnish the only link that would form the chain of testimony necessary to convict an individual of a crime." The silent implication is unflattering and unfair to petitioners who are marquee names in the legal profession and unjust to their undisclosed client. Finally, it ought to be obvious that petitioners' right to claim the attorney-client privilege is resolutory of the Complaint against them, and hence should be decided ahead and independently of their claim to equal protection of the law. Pursuant to the rule in legal hermeneutics that courts should not decide constitutional issues unless unavoidable, I also respectfully submit that there is no immediate necessity to resolve petitioners' claim to equal protection of the law at this stage of the proceedings. IN VIEW WHEREOF, I respectfully register a qualified dissent from the majority opinion. G.R. No. 70054 July 8, 1986 BANCO FILIPINO, petitioner, vs. MONETARY BOARD, ET AL., respondents. RESOLUTION On November 4, 1985, Petitioner Bank filed in the instant case a "Motion to Pay Back Salaries to All BF Officers and Employees from February to August 29, 1985" in connection with its "Opposition to Respondents" Motion for Reconsideration or for Clarification of the Resolution of the Court En Banc of October 8, 1985." On November 7, 1985, this Court referred said motion to pay back salaries to Branch 136 (Judge Ricardo Francisco, presiding) of the Makati Regional Trial Court, which this Court had earlier directed under our Resolution of October 8, 1985 issued in G.R. No. 77054, to conduct hearings on the matter of the closure of petitioner Bank and its alleged pre-planned liquidation. On January 22, 1986, said Regional Trial Court, after considering the petitioner's motion of November 4, 1985, the respondents' opposition thereto dated January 15, 1986; the petitioner's Reply dated January 16, 1986, and the respondents' Rejoinder dated January 20, 1986, issued an order directing the respondents herein "to pay all officers and employees of petitioner their back salaries and wages corresponding to the period from February to August 29, 1985." On February 4, 1986, respondents herein filed with this Court an "Appeal from, or Petition to Set Aside, order to Pay Back Salaries dated 22 January 1986" praying for the reversal and setting aside of the aforestated trial court's Order dated January 22, 1986. This was formally opposed by Petitioner when it filed its "Answer to Appeal (re: back salaries)" on February 26, 1986. A month later, on March 26, 1986, respondents filed their "Reply to the Answer" which petitioner traversed in a "Rejoinder to the Reply" dated April 2, 1986.

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In a normal situation, no controversy would be expected in the matter of the payment of said back salaries because in the instant case, the party praying for the same is the employer Bank. The attendant circumstances here present have, however, created a peculiar situation. There is resistance to the claim because the management of the assets of the Bank has been transferred to the Respondents' Receiver who perceived that the directive to pay back salaries after closure of the Bank would be dissipation of the banks' assets to the prejudice of its various creditors. There is, however, in this case a significant matter that deserves consideration of this Court and which must be viewed from the stand-point of equity. What stands out is that, regardless of whether the employees of Banco Filipino worked or not after January 25, 1985, there is the uncontested manifestation found in BF's Answer to the Appeal, dated February 26, 1986 (Vol. IV of Case Records) that: 2. In the fact the receiver/liquidator Carlota Valenzuela had paid Union employees of petitioner BF back salaries for no work from January 25, 1985 up to June, 1985. .. (Emphasis supplied) All employees, thereto, of petitioner Banco Filipino who have not yet received their back salaries corresponding to the period from January 25, 1985 up to June, 1985 manifestly deserve and ought to be similarly paid by the respondent Monetary Board. It is but fair that the issue whether or not the employees of petitioner Bank had actually worked during said period should now be discounted considering this voluntary act of respondent Monetary Board which would remove by estoppel any impediment to the receipt by all bank employees of their back salaries from January 25, 1985 up to June, 1985, assuming that some of them have not yet received the same. As the remaining period from June, 1985 to August, 1985, involves but a minimal period only of two (2) months, and considering the unfortunate plight of the numerous employees who now invoke the symphathetic concern of this Court, and inasmuch as the appealed Order for the payment of back salaries is only for a limited period or up to August, 1985, the appealed order of November 7, 1985 may be sustained. Petitioner BF and its stockholders have long put on record their consent to this patment of back salaries of its separated officers and employees. It is also averred that BF intends to reopen its bank and branches, and the payment of back salaries to its employees, no less would help in the preservation of its personnel which is the bank's most important assest, apart from doing justice to those aggrieved employees. It is mentioned that the Central Bank Liquidator has now more than a billion pesos in cash of Banco Filipino since it continued to receive payments from BF borrowers some P1.5 million a day. It is also said that with the deposits of petitioner BF with the Bank of PI, there is money sufficient to allow the withdrawal of the sums needed to pay the salaries of the employees who have been now out of work for over a year. Apparently, no substantial prejudice for the payment of the distressed employees of the bank for only a specified limited period until the other issues in the consolidated consideration. WHEREFORE, ruling that the Order of November 7, 1985 of Judge Ricardo Francisco, granting salary to the officers and employees of Banco Filipino for the period from February, 1985 to August 29, 1985, may now be deemed moot and academic insofar as it relates to the period from January 25, 1985 to June, 1985 up to August, 1985, covers but a minimal span of two (2) months, the Court RESOLVES, for the reasons of equity, to allow the aforestated Order to remain undisturbed and to DISMISS the appeal therefrom. This Order is immediately held executory. Gutierrez Jr., J., took no part. G.R. No. 70054 July 8, 1986 BANCO FILIPINO, petitioner, vs. MONETARY BOARD, ET AL., respondents. RESOLUTION Subject of this "Petition to Set Aside Order to Produce Documents dated 17 February 1986" is the Order of Branch 136, Regional Trial Court, Makati, granting the motion of the petitioner herein, based on Section 1, Rule 27, of the Rules of Court, for the production, inspection, and copying of certain papers and records which are claimed as needed by the Petitioner Bank for the preparation of its comments, objections, and exceptions to the Conservator's report dated January 8, 1985, and Receiver's Report dated March 19, 1985. The documents now asked to be produced, inspected, and copied are the following: (1) 22, 1985; (2) (3) (4) (5) (6) (7) (8) (9) Copies of tapes and transcripts of the Monetary Board (MB) deliberations on the closure of Banco Filipino (BF) and its meeting on July 27, 1984, and March Copies of the letter and reports of first conservator, Mr. Basilio Estanislao, to the MB and to Central Bank Governor Jose Fernandez; Papers showing computations of all the interests and penalties charged by the CB against BF; Schedule of recommended valuation of reserves per Mr. Tiaoqui's report dated March 19, 1985; Adjustment per Annex "C" of Mr. Tiaoqui's report; Annexes"A","B",and"C"of the joint report of Mr. Tiaoqui, Mr. Aurellano, and Mrs. Valenzuela; Schedule of devaluation of CB premises of Paseo de Roxas of same report; Schedule of BF's realizable assets from P5,159.44 B to P3,909.23 B as of January 25, 1985; Documents listed in BF's letter to Mrs. Carlota Valenzuela dated October 25, 1985.

In issuing the challenged order, the court below took the view that the Supreme Court's resolution referring to it the matters relative to the bank's closure does not preclude the petitioner from availing of this mode of discovery as an additional means of preparing for the hearing. It considered the documents sought to be produced as not privileged because these constitute or contain evidence material to the issues into by the Court. These materials are said to comprise of records of the administrative proceedings conducted by respondent's officials and representatives from the inception of and preparation of the challenged reports and the resolution placing petitioner under receivership and thereafter under liquidation as it is the regularity and impartiality of these administrative proceedings which are being assailed by the petitioner, the trial court saw no reason why said documents should be thus concealed from it. Respondents Monetary Board and Central Bank take exception to the said order and pray in their petition before this Court for the reversal and setting aside of the same. The grounds recited in support of their petition are the following: (1) The ratiocination of the trial court is wholly in error because the proceedings before it do not at all deal with either the administrative proceedings conducted by the respondents or the regularity and impartiality of the CB actions on BF; it does so simply upon the charge that no "hearing" was given BF prior to those actions of closure and liquidation. However, no such prior hearing had been called as none is required by the law and by the Supreme Court decisions in force to this date (Rural Bank of Lucena, Inc. vs. Arca, 15 SCRA 66, and Rural Bank of Bato vs. IAC, G.R. 65642, Oct. 15, 1984). (2) The tapes and transcripts of the Monetary Board deliberations are confidential pursuant to Sections 13 and 15 of the Central Bank Act.

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Sec. 13. Withdrawal of persons having a personal interest. Whenever any member attending a meeting of the Monetary Board has a material personal interest, directly or indirectly, in the discussion or resolution of any given matter, said member shall not participate in the discussion or resolution of the matter and must retire from the meeting during the deliberation thereon. The subject matter, when resolved, and the fact that a member had a personal interest in it, shall be made available to the public. The minutes of the meeting shall note the withdrawal of the member concerned. (As amended by PD No. 1827). Sec. 15. Responsibility. Any member of the Monetary Board or officer or employee of the Central Bank who wilfully violates this Act or who is guilty of gross negligence in the performance of his duties shall be held liable for any loss or injury suffered by the Bank as a result of such violation or negligence. Similar responsibility shall apply to the disclosure of any information of a confidential nature about the discussion or resolutions of the Monetary Board, except as required in Section 13 of this Act, or about the operations of the Bank, and to the use of such information for personal gain or to the detriment of the Government, the Bank or third parties. (As amended by Presidential Decree No. 72). (Italics supplied). (3) The Monetary Board deliberations were necessarily held subsequent t the submission of the CB reports. They did not enter into the making of those reports and can have no materiality to any question of fact that may be raised in relation to their contents. On April 16, 1986, Petitioner Banco Filipino filed its Comment on Respondent's petition to set aside the order for the production of the documents. In said pleading, the petitioner bank assails the respondent's petition on the following grounds: (1) There is no reason why Banco Filipino should not be furnished the documents, particularly Nos. 3 to 9 of its motion, when these are merely attachments to the Supervision and Examination Sector, Dept. It (SES) Reports, copies of which were given to it pursuant to a Supreme Court order. (2) The Supreme Court in its referral of October 8, 1985 to the RTC Makati intended full evidence taking of the proceeding for judicial review of administrative action filed with the Supreme Court, the trial court being better equipped for evidence taking. (3) The respondents cannot claim privilege in refusing to produce the Central Bank records because it is based only on the generalized interest in confidentiality. Petitioner cites as a precedent the doctrine established in the case of U.S. vs. Nixon, 418 U.S. 683, 713, which states that "when the ground for asserting privilege as to subpoenaed materials sought for use in a criminal case is based only on the generalized interest in confidentiality, it cannot prevail over the fundamental demands of due process of law." (4) The requested documents and records of the Central Bank are material and relevant because BF is entitled to prove from the CB records (a) that Governor Fernandez closed BF without a MB resolution and without examiner's reports on the financial position of BF; (b) that a MB resolution was later made to legalize the BF closure but it had no supporting examiner's report; (c) that the earlier reports did not satisfy respondent Governor Fernandez and he ordered the examiners and the conservator, Gilberto Teodoro, to "improve" them; and (d) that the reports were then fabricated. Petitioner adds that what respondents fear is disclosure of their proceedings because petitioner has accused the CB governor of (a) covering 51% of its stockholding, (b) encashing BF securities in trickles as fuel a run, (c) appointing a conservator when the President ordered the MB to grant petitioner a P 3 Billion credit line, (d) replacing Estanislao with Gilberto Teodoro when the former wanted to resume normal operations of BF, and (e) changing the conservatorship to receivership when it appointed Carlota Valenzuela as receiver again without hearing. On May 13, 1986, Respondent Monetary Board filed their Reply to Petitioner Bank's Comment dated April 15, 1986. Respondents argue that: (1) The case of U.S. vs. Nixon and the other decisions cited by petitioner are inapplicable because-

a) The authorities cited refer only to a claim of privilege based only on the generalized interest of confidentiality or on an executive privilege that is merely presumptive. On the other hand, the so-called MB deliberations are privileged communications pursuant to Section 21, Rule 130 of the Rules of Court because statements and opinions expressed in the deliberation of the members of the MB are specifically vested with confidentiality under Secs. 13 and 15 of the Central Bank Act. The "public interest" requirement for non-disclosure is evident from the fact that the statute punishes any disclosure of such deliberations. b) Petitioner has not in the least shown any relevance or need to produce the alleged MB deliberations. What petitioner intends to prove are not "issues" raised in the pleadings of the main petition. (2) Petitioner is interested, not in discovering evidence, but in practicing oppression by the forced publication of the MB members' confidential statements at board meetings. (3) The so-called deliberations of the Monetary Board are in truth merely the individual statements and expressions of opinion of its members. They are not statements or opinions that can be imputed to the board itself or to the Central Bank. The transcripts of stenographic notes on the deliberations of the MB are not official records of the CB; they are taken merely to assist the Secretary of the MB in the preparation of the minutes of the meetings. And as advertedly also, the tape recordings are not available as these are used over and over again. The motion for the production of the subject documents was filed by petitioner pursuant to Section 1, Rule 27, of the Rules of Court. It has been held that "a party is ordinarily entitled to the production of books, documents and papers which are material and relevant to the establishment of his cause of action or defense" (General Electric Co. vs. Superior Court in and for Alameda County, 45 C. 2d 879, cited in Martin, Rules of Court, 3rd edition, Vol. 2, p. 104). "The test to be applied by the trial judge in determining the relevancy of documents and the sufficiency of their description is one of reasonableness and practicability" (Line Corp. of the Philippines vs. Moran, 59 Phil. 176, 180). "On the ground of public policy, the rules providing for production and inspection of books and papers do not authorize the production or inspection of privileged matter, that is, books, papers which because of their confidential and privileged character could not be received in evidence" (27) CJS 224). "In passing on a motion for discovery of documents, the courts should be liberal in determining whether or not documents are relevant to the subject matter of action" (Hercules Powder Co. vs. Haas Co., U.S. Dist. Ct. Oct. 26, 1944, 9 Fed. Rules Service, 659, cited in Moran, Comments on the Rules of Court, 1979 Ed. Vol. 2, p. 102). Likewise, "any statute declaring in general terms that official records are confidential should be liberally construed, to have an implied exception for disclosure when needed in a court of justice" (Wigmore on Evidence, Vol. VIII, p. 801, citing the case of Marbury vs. Madison, 1 Cr. 137,143). In the light of the jurisprudence above-cited, this Court holds that no grave abuse of discretion was committed by the court below in granting petitioner's motion for the production of the documents enumerated herein. We accept the view taken by the court below that the documents are not privileged and that these constitute or contain evidence material to the issues being inquired into by the Court. With respect to Items Nos. 3 to 9, these are the annexes to the Supervision and Examination Sector, Dept. II (SES) Reports submitted to the Central Bank and Monetary Board which were taken into consideration by said respondents in closing petitioner bank. A copy of the SES Reports was furnished to the petitioner. We, therefore, fail to see any proper reason why the annexes thereto should be withheld. Petitioner cannot adequately study and properly analyze the report without the corresponding

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annexes. Pertinent and relevant, these could be useful and even necessary to the preparation by petitioner of its comment, objections and exceptions to the Conservator's reports and receiver's reports. Regarding copies of the letter and reports of first Conservator, Mr. Basilio Estanislao, to the Monetary Board and to Central Bank Governor Fernandez (Item No. 2) these appear relevant as petitioner has asserted that the above-named Conservator had in fact wanted to resume normal operations of Banco Filipino but then he was thereafter replaced by Mr. Gilberto Teodoro. The letter and reports could be favorable or adverse to the case of petitioner but whatever the result may be, petitioner should be allowed to photocopy the same. As to the tapes and transcripts of the Monetary Board deliberations on the closure of Banco Filipino and its meetings on July 27, 1984, and March 22, 1985, (Item No. 1), respondents contend that "it is obvious from the requirement (Sections 13 and 15 of the Central Bank Act) that the subject matter (of the deliberations), when resolved. . . shall be made available to the public but the deliberations themselves are not open to disclosure but are to be kept in confidence." This Court, however, sees it in a different light. The deliberations may be confidential but not necessarily absolute and privileged. There is no specific provision in the Central Bank Act, even in Sections 13 and 15 thereof, which prohibits absolutely the courts from conducting an inquiry on said deliberations when these are relevant or material to a matter subject of a suit pending before it. The disclosure is here not intended to obtain information for personal gain. There is no indication that such disclosure would cause detriment to the government, to the bank or to third parties. Significantly, it is the bank itself here that is interested in obtaining what it considers as information useful and indispensably needed by it to support its position in the matter being inquired to by the court below. On the other hand, respondents cite Section 21, Rule 130, Rules of Court which states: Section 21. Privileged Communications. The following persons cannot testify as to matters learned in confidence in the following cases: xxx xxx xxx

(e) A public officer cannot be examined during his term of office or afterwards, as to communications made to him in official confidence, when the court finds that the public interest would suffer by disclosure. But this privilege, as this Court notes, is intended not for the protection of public officers but for the protection of public interest (Vogel vs. Gruaz 110 U.S. 311 cited in Moran, Comments on the Rules of Court, 1980 Ed. Vol. 5, p. 211). Where there is no public interest that would be prejudiced, this invoked rule will not be applicable. The rule that a public officer cannot be examined as to communications made to him in official confidence does not apply when there is nothing to show that the public interest would suffer by the disclosure question. ... ,( Agnew vs. Agnew,'52 SD 472, cited in Martin Rules of Court of the Philippines, Third Edition, Vol. 5, p. 199). In the case at bar, the respondents have not established that public interest would suffer by the disclosure of the papers and documents sought by petitioner. Considering that petitioner bank was already closed as of January 25, 1985, any disclosure of the aforementioned letters, reports, and transcripts at this time pose no danger or peril to our economy. Neither will it trigger any bank run nor compromise state secrets. Respondent's reason for their resistance to the order of production are tenuous and specious. If the respondents public officials acted rightfully and prudently in the performance of their duties, there should be nothing at all that would provoke fear of disclosure On the contrary, public interests will be best served by the disclosure of the documents. Not only the banks and its employees but also its numerous depositors and creditors are entitled to be informed as to whether or not there was a valid and legal justification for the petitioner's bank closure. It will be well to consider that Public interest means more than a mere curiosity; it means something in which the public, the community at large, has some pecuniary interest by which their legal rights or liabilities are affected (State vs. Crocket, 206, p. 816 cited in Words and Phrases, Vol. 35, p. 229). IN VIEW OF ALL THE FOREGOING, the order to produce documents dated February 17, 1986 issued by the court below in S.C.- G.R. No. 70054, is hereby affirmed, except as to the copies of the tapes relative to the Monetary Board deliberations on the closure of Banco Filipino on January 25, 1985 and its meetings on July 27, 1984, and March 22, 1985 and only if such tapes are actually no longer available taking into account respondent Monetary Board's manifestations that the tape recording of the deliberations of that Board are, for purposes of economy, used over and over again inasmuch as these tapes are not required to be kept or stored. (See Respondent's Reply, dated May 12, 1986; Rollo, Vol. IV, pp. 1288-1289). SO ORDERED.