Analysis: Appellate justices displayed undue interest in the Meralco-GSIS row

Lala Rimando,

Posted at Aug 05 2008 10:12 AM | Updated as of Aug 05 2008 06:32 PM

Based on a detailed review of the events that transpired as culled from the correspondences among the justices, various media interviews of the stakeholders, and insights from various sources, found that two major reasons caused the current brouhaha at the Court of Appeals.

The first is the undue interest displayed by several magistrates during the almost two months that the appellate court was handling the corporate case involving two warring shareholders of the Manila Electric Co. (Meralco)—the Lopez family and their allies, and the Government Service Insurance System (GSIS).

Some appellate justices displayed eagerness, and in some instance, aggressiveness, in ensuring that they are included in the team that determined the fate of the two camps.

The second is the weak leadership displayed by the court's Presiding Justice Conrado Vasquez over the Meralco-related issues that were brought to his attention by the various magistrates. The referral of these issues to the court's Rules Committee and his firm support for whatever that committee decides on could have doused the brewing rift among his subordinates early on.

At the end of the day, however, the biggest loser is the integrity of the appellate court.

When elephants fight

The Meralco case, which was triggered by the contentious May 27 annual stockholders meeting is basically a jurisdictional issue: should the Securities and Exchange Commission be followed since it was out to protect the investors' interest, or should the stakeholders' dispute be heard by the regular courts, which has long been in-charge of intra-corporate cases?

That question pitted two formidable players: the wealthy Lopez family and the government through Winston Garcia, GSIS's general manager. Each has about one-third stake in Meralco.

What started as a boardroom row in March that evolved into a proxy fight during the annual stockholders meeting in May, has caused an almost similar, and troubling, discord among the Court of Appeals justices.

Roxas's questionable interest

Among all the five appellate justices who handled the case—whether they heard the oral arguments of the parties' lawyers, or read the written explanations of the contending parties, or issued either the temporary restraining order (TRO) or the decision on the case—the justice that displayed the most undue interest was Justice Vicente Roxas.

Roxas, being the ponente, or the assigned writer of the case, clearly has an upper hand as far as the CA's internal rules are concerned. When the CA underwent a reorganization where justices were shuffled and assigned to other divisions because of retirement of some justices, the Meralco case was transferred to the new division where Roxas was assigned.

In this case, since he came from the 9th division—with Justices Jose Sabio, Jr. and Myrna Vidal completing the three-person division—and was transferred to the 8th division—with Justices Bienvenido Reyes and Apolinario Bruselas—the CA's internal rules say that the Meralco case should be handled by the new 8th division because the ponente, Roxas, was there.

So far, the two positions that the CA has taken, namely the 60-day TRO in May issued by the original 9th division, and the decision promulgated in July 23 issued by the new 8th division, favored the Lopezes and their allies.

In both instances, which were separately handled by the two different divisions, Roxas displayed dubious behavior.

Sabio, in his July 26 letter to the presiding justice, noted that when Roxas completed the draft of the TRO in May, Roxas personally delivered the document to his office. We learned that in the courts, decisions are routed to ensure that the magistrates do not display their personal interest toward any of the litigants.

Sabio described Roxas's personal delivery of the draft TRO as "surprising."

In July, Roxas again did this with Vidal when he personally brought the draft decision to the latter's office. Vidal, in her July 24 letter to the presiding justice, said she agreed with the decision favoring Meralco but was concerned about the "apparent and obvious irregularities in the handling of CA GR SP No. 103692 (Meralco case)."

Vidal, who was with Sabio and Roxas in the old 9th division, would later express her disappointment that "judicial courtesy was not observed." She noted how she was "hurried[ly] eased out of the case," thus the time she spent time studying the case went to waste since it was eventually the new 8th division that promulgated it.

One-day 50-page decision

Roxas seemed to have also hurried in another task related to the Meralco case: the time it took him to write the decision that favored Meralco.

The parties—Meralco and GSIS—submitted their memoranda, or the summary of all their arguments, including those not included during the oral argument, on July 11, a Friday. The next working day, July 14, Monday, the new 8th division conducted its final deliberation and on that same day, Roxas already finished writing the decision—a whole set that added up to more that 50 pages.

Sabio, in one of his media interviews, showed that the memoranda from the two parties piled up to almost a foot high and that it took him a good number of days to go through all of them.

Roxas then forwarded the document to Bruselas, who in turn also affixed his signature that same day.

With one more signature to go—Reyes's—Roxas relentlessly urged the new 8th division chairman through various memoranda between July 14 and 22 to make up his mind. In Reyes's letter to the presiding justice, he recalled that Roxas was urging him to dissent so that a division of five could be convened in time to decide before the 60-day TRO expired on July 30.

It was around that time that Roxas personally delivered the draft decision to Vidal for her signature.

Reyes finally signed the decision on July 23. In the end, it was still the three members of the new 8th division that signed the decision that supports the Lopez family's continuing control of the utility firm.

Sabio, too

Justice Jose Sabio, Jr., who first questioned the procedure surrounding the decision favoring Meralco, himself demonstrated his own undue interest toward the case.

During the June 23 oral argument, Sabio was just a substitute to Reyes at the 9th division. Reyes was on leave when the case was raffled to the 9th division, which Reyes chaired.

When Reyes reported back to work in June 16, he wanted to assume the Meralco case already, but Sabio appeared to want to keep the post as chairman of the 9th division.

In a statement submitted to the CA en banc meeting called by Vasquez, Roxas relates that Sabio “refused to relinquish the acting chairmanship of the 9th division and he left the regular 9th division chairman justice Reyes out in the cold when Justice Sabio presided over the June 23 hearing….Justice Reyes did not want to make a scene at the hearing. Justice Sabio embarrassed Justice Reyes by simply showing up, forcing Justice Reyes to retreat.”

Sabio, we learned, did not disclose to the parties to the case that Reyes had already returned to work.

Rules committee chair snubbed

Reyes then went to the rules committee chaired by Justice Edgardo Cruz, who then issued a written reply that based on the rules, Reyes should already assume the case since he's the designated chair of the 9th division.

Sabio, however, was slighted that Reyes, who is "junior to him in the court," was telling him to disengage. Sabio even said Cruz was just issuing a personal opinion.

Instead, Sabio consulted Justice Martin Villarama, whom he described in his letter as "more senior, experienced, and respected member of this court for consultation and guidance." Villarama, according to Sabio, advised him to chair the 9th division during the oral argument.

In July, as the rift among the justices grew, Sabio would tell his colleagues, Bruselas and Vidal to also seek the opinion of Villarama. Villarama, however, is not with the rules committee.

GSIS, defending Sabio, said in a press release that Sabio was "unceremoniously excluded" from the case.

A week after the oral argument, the alleged bribe offer took place. It is surprising, though, that Sabio did not immediately report the attempted bribery, which happened on July 1. It was only on July 26, or weeks later, when he wrote Vasquez and narrated the incident.

The behavior of the appellate justices, particularly that of Roxas's and Sabio's, casts doubt on the integrity of the court. The CA presiding justice, however, was slow to act on the all this.

Part 2: CA weak leadership allowed rift to prosper