2nd Sem

The High Price of Justice

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The High Price of Justice

THE PHONE rang at an office in Makati and the senior partner of a big law firm took the call.
At the other end of the line was the head of one of the Philippines' biggest business houses. He was worried about how the Supreme Court was going to decide on the fate of one of his companies, where a big bloc of shares had been sequestered by the government and was now being contested by a determined rival.

The phone call came while this journalist was interviewing the lawyer.
"I thought we had talked with those justices already," the businessman said.
His lawyer replied: "But the other side is talking to them as well. What can we do?"
What was at stake was the future of a company that was worth several hundred million pesos. The controversy had dragged on for years, with the Court reversing itself, depending, the parties suspected, on who was paying some of the justices.

By now, the lawyer was blasé about the whole thing. "If the stakes are high and you think the other party is maneuvering, you have to even the playing field for your client," he said. "You have to pay the price."
This lawyer is not alone. All around Makati these days, lawyers and businessmen talk about the steep price of justice in the Supreme Court.
But corruption is not the only issue. Lawyers cite the Court's heavy workload, its seeming incompetence and lack of brilliant legal minds. All these, they say, combine to make a Court where laws and procedures are applied helter-skelter. They accuse Andres Narvasa, who has been chief justice since 1991, of failing to lead the tribunal toward any discernible direction or coherent philosophy.

"It's almost whimsical," said lawyer Ricardo Romulo, chairman of the Makati Business Club and head of one of the country's biggest and most respected law firms. "They seem to go every which way and I put the blame on what I discern is a lack of a consistent philosophy underlying their decisions."

Precedents, on which the entire system of law is based, are overturned with enough frequency to confound the legal profession, some of the country's top lawyers say.
"The legal system is no longer predictable and stable," said law professor and practitioner Haydee Yorac, who once served as election commissioner. "Corruption aside, there has been no effort to establish a systematic order. I have nothing against the Supreme Court overturning established decisions, nothing against reversing precedents perceived to be wrong or against the Constitution. But in most instances, they don't even cite any basis for doing so."
Narvasa brushes aside these criticisms. It is not a question of philosophy, he said in an interview, merely a matter of applying the law. In the Philippines, unlike in the United States, where "there is greater latitude in the exercise of judicial function," he explained, "what is expected of a justice is to determine what the facts are in a particular case and to apply the law to those facts... regardless of your personal feeling or your own personal philosophy."
But some lawyers charge that decisions are sometimes tailor-made for well-connected litigants - even if they are contrary to well-established precedents and wreak havoc on the conduct of law and business, both of which rely on the predictability of rules.

"The problem for us lawyers is that the Supreme Court has now become unpredictable," said Eduardo de los Angeles, senior partner in a major Makati law firm. "Our practice was to give advice on the basis of precedent, but here we now have a situation where you can't rely on precedents. There are times the Court cites precedents only to find reasons why these are not applicable."

Such unpredictability comes at a time of economic liberalization and growth and the stakes involved in business disputes are gargantuan. In recent years, the Court has been asked to resolve disputes on land, taxes, sequestered companies, patents and intellectual property, where the amounts involved reach billions.

But the Court has failed to rule with coherence and clarity on these disputes. In December 1995, for example, it decided against the US manufacturer of Lee jeans which sued a local garments firm using the Lee trademark. Emerald Garments, the local firm, had been sewing an almost exact replica of the Lee logo on its jeans, except that it added the words "Mr. Stylistic" in small print.

By deciding in favor of Emerald Garments, the Supreme Court overturned some two dozen precedents on the infringement of trademarks. It also went against the Philippines' international commitments to honor intellectual property rights.

"That was a crazy decision," said lawyer and former Senator Rene A. V. Saguisag. "I saw the logos and there really is a confusion in the public mind. It set a very bad precedent from the standpoint of law, public opinion and our international standing."

In another case involving the sale of a large tract of land in Pasig to National Bookstore, the Supreme Court's Third Division chaired by now retired Justice Florentino Feliciano unanimously ruled in favor of Lim Ket Kai, the original buyer of the property.

Two weeks after that decision was made, the Third Division was reorganized, with Narvasa as the new chairman and two other justices as new members. A month after the reorganization, the new division cited the Lim Ket Kai case as a precedent in a decision on the First Philippine International Bank case.

But two months afterward, in March 1996, the division reversed itself. It set aside the first Lim Ket Kai decision and ruled in favor of National Bookstore.
There are similar flip-flops in sequestration cases. In January 1995, Narvasa penned an omnibus decision involving dozens of sequestered companies, which said that the government's failure to file cases against each of the sequestered firms within the six-month deadline set by the Constitution does not nullify their sequestration.

But in March 1996, the Third Division chaired by Narvasa lifted the sequestration on two companies owned by Lucio Tan - Sipalay Trading Corp. and Allied Bank - on the grounds that the government had failed to file charges against them within the timetable prescribed by the Constitution.

Saying that there was a "hairline, but critical distinction" in this case, the division argued that, unlike in other sequestered companies, the government had no evidence with which to file charges against the two Tan firms.

"Frankly, I'm confused," said Katz Tierra, who has been practicing law for 30 years and is a partner in an Ortigas Center law firm. "It's rather scary. You would think, all right, this is the doctrine now, and then you read another decision and it seeks to distinguish and you can't quite grasp the distinction. So you get scared. It gets to be there are so many distinctions, it's no longer clear."

These charges come at a time when the Supreme Court has never been as powerful, a consequence in part of a provision in the 1987 Constitution which expanded the high tribunal's power to review cases.

This provision was put into the Constitution by jurists like former Supreme Court chief justice Roberto Concepcion who saw how Marcos controlled the court during martial law and so envisioned a powerful tribunal that could check the excesses of an abusive executive.
The Supreme Court has the leeway to set its own procedural rules which, some lawyers say, makes it easier for some justices to revise the procedures to suit favored litigants.
At the same time, the high tribunal's own power remains virtually unchecked: Lawyers are wary about reporting ethical lapses for fear of repercussions against their clients. The only check is the impeachment by Congress of individual justices, a long and tedious process which legal experts say is almost impossible to see through.

The 1987 Constitution also gave the Supreme Court the choice of sitting in divisions of three, five or seven members each. The Court is at presently divided into three divisions, each composed of five justices. A division can issue a decision with a majority of three justices voting in favor. This can be a formula for confusion.

"Sometimes, the divisions don't talk to each other," said Father Joaquin Bernas, former Ateneo president and member of the 1987 constitutional commission. "One principle may be asserted with one division and the opposite by another division."

In November 1993, for example, the Third Division ruled in the case of Philippine Duplicators, Inc. that commissions form part of the salaries of salesmen and should therefore be used in computing their 13th month pay. But one month later, the Second Division ruled the exact opposite in the cases of Boie-Takeda Chemicals and Philippine Fuji Xerox Corp: Commissions are not part of the basic salary and should be excluded from 13th month pay computations.
Apart from addling the public, lawyers and litigants say the division system makes the Court easier to manipulate. Most times, an enterprising litigant has only to approach three justices to ensure his victory.

But the process is a complex one. It first of all involves obtaining information on the Court—to which division a case will be assigned and the identity of the ponente or writer of the decision. Cases are raffled to any of the divisions, which then assign the ponente, also by raffle. Some cases, especially those which involve the modification or reversal of precedents, are elevated to the court en banc, which means that all 15 justices have to vote on it.

The assignment of divisions is a matter of public record, but the identity of the ponente is kept confidential. "A few lawyers try to find out who's the ponente," said Tierra. Once they obtain that information, their "first question is 'Can I talk to this guy?' If it is guys like (Justice Teodoro) Padilla, (Hilario) Davide, or (Florenz) Regalado, then that 's it. It ends there."
The ponente is crucial. Most times, individual justices make up their minds based on the presentation of the writer of the decision. Given the load of each justice (over 300 cases each) and of each division (some 1,500 for all five justices), the members of a division cannot be expected to study carefully all the cases they are asked to decide.

"You study the 300 cases assigned to you," said former Justice Feliciano "and then hope that each one does the same thing for their cases." Sometimes, he added, unless they are assigned to be the ponente, justices cannot read all the motions and pleadings in each case.
In many cases, the majority of justices go with the ponente's arguments for or against a case. The first step, then, is to get the ponente's identity. Although this is secret, lawyers say some Supreme Court personnel sell the information for something like P2, 000. Once the ponente is known, the approaches begin.

This is why many big law offices have a two-track practice: one track to line up the legal arguments in the case and the other to lobby with members of the Court. "The key is to get the ponente," said Saguisag. "Some law offices would look for a connection—a former law school classmate, a kumpadre, a former justice, or a former associate in the law firm where the justice used to work... The game is to look for the katapat, the one whom the justice cannot refuse. In a transactional society, the katapat has some ascendancy."

One medium-sized company, for example, put a retired justice on its retainer so he could arrange access to Supreme Court justices. "The company gives him an initial fee of P50, 000 and after he contacts the ponente justice, our petition which is initially denied and practically a dead horse, at first impossible to revive, is suddenly given due course," the company lawyer confided in a 1995 letter to Saguisag. A separate payment was arranged for the justice, but the lawyer was not privy to the amount.

One businessman we interviewed believes he lost his case involving property worth hundreds of millions because he did not approach any of the justices. By the time he realized that his opponent was lobbying with the members of the Court, the decision had already been written.
The businessman tried to make his own approaches while his motion for reconsideration was pending before the Court. But he was told by several intermediaries, including the sons of a senior Supreme Court justice, that it was too late to change the justices' minds about the case as they were already committed to his opponent.
The businessman got as far as talking to the ponente. Later, through an intermediary, he offered several millions for a favorable decision. The ponente appeared interested, the businessman said, especially as the offer was doubled and tripled in the course of the transaction. But in the end, the justice turned it down.

"We've learned our lesson," said the businessman. "It's a bidding war. It's a business. It's a question of how much the property is worth to you, how much you're willing to pay... We were caught off guard. We should have bribed in the beginning. Unahan na lang."
But while businessmen can charge pay-offs as part of the cost of doing business, many lawyers are aghast. "We're very frustrated, we're helpless," said a senior lawyer in a Makati law firm. "We don't know what more to do. You can't rest if you have a case because your opponent may be maneuvering. Our ethical and moral dilemma is, you can't sit back while your client tells you, 'You must do something.' But what can you do that's ethical and moral? Our cop-out is, we tell the client, 'Do what you think you have to do.'"

posted by Graciella @ 4:57 AM