Republic vs Cojuangco Crim Digest

Republic vs. Cojuangco Jr. G.R. No. 139930 June 26, 2012 Facts: In 1977, Regala, Lazatin, et al incorporated the United Coconut Oil Mills, Inc. (UNICOM). On August 29, 1979 the Board of Directors of the UCPB, composed of respondents Cojuangco et al, authorized UCPB to invest not more than P500 million from the fund in the equity of UNICOM for the benefit of the coconut farmers. On September 4, 1979 UNICOM increased its authorized capital stock to 10 million shares without par value. On September 18, 1979, a new set of UNICOM directors, composed of respondents Eduardo M. Cojuangco, Jr., et al approved another amendment to UNICOM’s capitalization by increasing its authorized capital stock to one billion shares. The paid-up subscriptions of 5 million shares without par value were then converted to 500 million Class A voting common shares without par value per share. Respondents amended again UNICOM’s capitalization on September 18, 1979, giving the incorporators unwarranted benefits by increasing their 1 million shares to 100 million shares without cost to them. And UNICOM filed its Certificate of Filing of Amended AOI with the SEC on February 8, 1980, making public respondents acts as board of directors. On March 1, 1990 the Office of the Solicitor General filed a complaint for violation of Section 3(e) of Republic Act (R.A.) 3019 against respondents, the 1979 members of the UCPB board of directors, before the PCGG. Nine years later, the Office of the Special Prosecutor issued a memorandum that the action has already prescribed. Issue: Whether or not respondents alleged violation of Section 3(e) of R.A. 3019 already prescribed. Ruling: R.A. 3019 being a special law, the 10-year prescriptive period should be computed in accordance with Section 2 of Act 3326 which states that “prescription shall begin to run from the day of the commission of the violation of the law, and if the same be not known at the time, from the discovery thereof xxx” That investment does not, however, appear to have been withheld from the public. The transaction left the confines of the UCPB and UNICOM board rooms when UNICOM applied with the SEC to accommodate UCPB’s investment. Changes in shareholdings are reflected in the General Information Sheets that corporations have been mandated to submit annually to the SEC.

Reckoning the 10-year prescriptive period from the commission of the violation of law, the last day for filing the action was, at the latest, on February 8, 1990. Hence, the action has already prescribed.