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Feb 15

Sacrifice the Plum Tree In Place of the Peach

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(Digital painting, “Siege warfare,” by Linchen)

After Sunday’s use of the last of the Thirty Six Stratagems, If All Else Fails Retreat, yesterday was about the use of a stratagem for Confrontation: Sacrifice the Plum Tree In Place of the Peach, where the defense took a temporary beating from the Senate but achieved the larger advantage it sought. Put another way, in the European sense, the decision was to concede the court of public opinion, sandbag the Senate, and open up a new front –in the Supreme Court.

From Clausewitz’s Schwerpunkt: mistranslated from German ?Misunderstood in English:

Clausewitz used Schwerpunkt on several occasions in his seminal work On War (see chapter 4, “Closer Definition of the War’s Objective: Suppression of the Enemy,” of Book 8). In countries subject to domestic strife, he claimed, the Schwerpunkt is generally the capital. In the same paragraph he states that “in small countries that rely on large ones, it [Schwerpunkt] is usually the army of their protector; among alliances, it lies in the community of interests; and in popular uprisings it is the personality of leaders and public opinion. It is against these that our energies should be directed.”

When assessing all of these possibilities, one should keep Clausewitz’s ideas on Schwerpunkt in context. Ultimately, Clausewitz firmly believed that the destruction or neutralization of the enemy’s forces was the means to final victory. Identifying the Schwerpunkt would enable the attacker to effect those means.

The defense needed to open up a new front after being cornered in the Senate. For a time, it has tried to contest public opinion. Failing that –despite insisting that the “country is divided”– it has tried to divide the public along fault lines in the community of interest, by say, trying to frighten some with stories of possible bank runs; others, or dazzling others with legal technicalities or the assertion that impeachment is along the lines of a criminal trial; and so forth. But despite everything, the information so far brought to light, has been devastating:

CASH AND INVESTMENTS OF CHIEF JUSTICE RENATO CORONA c.jpg

Or, as Article VIII Jester summarizes it:

Years

SALN Cash Assets Declarations

Total Deposits in

PSBank/BPI Peso Accounts

Undeclared

Cash Assets

2005

P3,300,000.00

P149,767.36

(P3,150,232.64)

2006

P2,500,000.00

P153,395.12

(P2,346,604.88)

2007

P2,500,000.00

P10,087,966.44

P7,587,966.44

2008

P2,500,000.00

P1,525,872.87

(P974,127.13)

2009

P2,500,000.00

P9,178,501.83

P6,678,501.83

2010

P3,500,000.00

P31,752,623.09

P28,252,623.09

That they have been unable to either prevent damaging facts from coming out, or managed to shield the public from seeing what is obvious, is only surprising to those who hadn’t followed the Estrada impeachment trial or who still think Gloria Macapagal-Arroyo is somehow misunderstood. The Estrada defense strategy failed for the same reason the Corona defense strategy is failing: the public understands what impeachment is about. The crucial difference between then and now, is a broader consensus to keep everything within the institutional arena.

Still, things have indeed been something of a roller-coaster-ride. One thing going for he defense is something that I think is not fully appreciated: the judiciary has a greater reservoir of power in the form of prestige and I would even say, mystical authority than, say, most Western observers would appreciate or clinical students of power politics might consider. This has less to do with reverence for the authentic rule of law, and more due to the same superstitious awe the clergy inspires in a great many people, still. If an archbishop can influence politics, a justice can, for nearly identical reasons: little of it having to do with any perceptions of actual innate holiness, or justness, on the part of either prelate or magistrate. Rather, it’s due to the Power of the Book.

Things have come to a head after the peso accounts were confirmed by the banks in which the Chief Justice maintains accounts.

The question then became what to do about inquiries into the foreign currency accounts of the Chief Justice. As everyone expected, there was a crucial vote in the Senate: a crucial vote because the Senate has been confronted with a TRO issued by the Supreme Court. The decision of the Senate yesterday, was to assert its prerogatives while holding back from an outright confrontation with the Supreme Court:

This means the question is left hanging until a resolution is arrived at in the Supreme Court. The defense has been trying to suggest this is merely a pause before they win with finality. But as lawyer Victor Eleazar points out in a commentary republished by Sonny Pulgar,

It will be interesting to see if the Supreme Court will apply its ruling in the 1997 case of Salvacion v. Central Bank of the Philippines and China Banking Corporation (G.R. No. 94723, August 21, 1997) in the petition of Philippine Savings Bank to stop the Senate Impeachment Court from looking at the dollar accounts of CJ Renato Corona…

Justice Torres Jr. in his ponencia prefaced the decision of the Supreme Court in this manner: “In our predisposition to discover the ‘original intent’ of a statute, courts become the unfeeling pillars of the status quo. Little to do we realize that statutes or even constitutions are bundles of compromises thrown our way by their framers. Unless we exercise vigilance, the statute may already be out of tune or irrelevant to our day.” The Court then concluded, “the application of the law depends on the extent of its justice.” If it were to rule that the law exempts from attachment, garnishment, or any other order or process of any court, legislative body, government agency or any administrative body whatsoever, is applicable to a foreign transient, injustice would result especially to a citizen aggrieved by a foreign guest. It found it “unthinkable” that the questioned provision would be used as a device by the accused for wrongdoing, and in doing so, acquitting the guilty at the expense of the innocent.

In closing, Justice Torres Jr. said, “Call it what it may – but is there no conflict of legal policy here? Dollar against Peso? Upholding the final and executory judgment of the lower court against the Central Bank Circular protecting the foreign depositor? Shielding or protecting the dollar deposit of a transient alien depositor against injustice to a national and victim of a crime? This situation calls for fairness against legal tyranny. We definitely cannot have both ways and rest in the belief that we have served the ends of justice.” Thus, the Court compelled Central Bank and China Bank to comply with the writ of execution issued in the civil case and to release to the victim the dollar deposit of the foreigner in such amount as would satisfy the judgment.

The Supreme Court found an exception in an otherwise ironclad law that considered foreign currency deposits of an absolutely confidential nature and exempt from attachment, garnishment or any other order or process of any court. Yet, nobody complained when the Court upheld the rights of the rape victim over the interest of a transient foreigner. It was not simply because the foreigner was nowhere to be found within the Philippines; rather it was a question of justice. Now, did the decision cause any impact on foreign investment? Definitely not!

In the case of China Banking Corp. v. Court of Appeals and Gotianuy (G.R. No. 140687, December 18, 2006), the Supreme Court found another exception when it sustained the validity of the subpoena issued by the Regional Trial Court of Cebu City to employees of China Bank for the purpose of disclosing the name or in whose name the foreign currency fund was deposited. In this case, it was not disputed that the dollars originally came from the late Jose Gotianuy. He, according to the Court has legal rights and interests in the China Bank account where said monies were deposited even if the account is in the name of another party.

The ponente Justice Chico-Nazario went on to say, “All things considered and in view of the distinctive circumstances attendant to the present case, we are constrained to render a limited pro hac vice ruling. Clearly, it was not the intent of the legislature when it enacted the law on secrecy on foreign currency deposits to perpetuate injustice. This Court is of the view that the allowance of the inquiry would be in accord with the rudiments of fair play, the upholding of fairness in court judicial system and would be an avoidance of delay and time-wasteful and circuitous way of administering justice.”

This was further explained in the recent case of GSIS v. 15th Division of the Court of Appeals (G.R. No. 189206, June 8, 2011) in this manner: “This Court highlighted the exception to the non-disclosure of foreign currency deposits, i.e., in the case of a written permission of the depositor, and ruled that respondent, as owner of the funds unlawfully taken and which are indisputably now deposited with China Bank, he has the right to inquire into the said deposits.”

Time and again, lawyers are reminded that their first duty is to comply with the law rather than look for loopholes. On the other hand, the Supreme Court finds exceptions to the law. Although looking for loopholes or finding exceptions would amount to the same thing, the fact remains is that the former is not supposed to be done by lawyers while the latter is permissible since the Supreme Court has the final say on what the law means and sometimes what it ought to mean or it really should mean.

Will the Supreme Court find an exception to the Foreign Currency Deposit Act in the case of their Chief Justice? It bears emphasis that the purpose of the law is to protect foreign investors and depositors and encourage the flow of foreign currency in the economy. It was never intended to shield a public official from any examination or investigation for charges of graft and corruption or ill-gotten wealth. It may even send a wrong signal to public officials and employees and criminal elements, which is for them to put their money in foreign deposit accounts and therefore beyond the reach of “any court, legislative body, government agency or any administrative body whatsoever.”

Today, after Senator Miriam Defensor-Santiago apparently became rather too intemperate in her criticisms of the prosecution, the Senate President stopped her by taking full responsibility for the subpoena that she wanted to use as grounds for disbarring members of the prosecution (the full text is published in Rappler.com; the Senate President’s remarks joins those of his colleagues Antonio Trillanes and Miriam Defensor-Santiago in at least presenting to the public, that senator’s views on impeachment and their roles in it):

Now, as far as the subpoena duces tecum involved, which was issued by this presiding officer upon the behest of the prosecution, this presiding officer assumes full responsibility for issuing that subpoena. And is ready to defend his position in any court of law if there is a need for that.

I will not pass the buck to the Senate sitting as an impeachment court. It was my decision as the presiding officer and I am personally bound to assume the consequences of my action as a presiding officer.

Having said that, I do not wish to delve on the issue [on the] exercise to issue compulsory processes by this court in this particular instance involving Republic Acts 1405 and 6426.

I do not want to make any pronouncement on that because precisely this court, through this presiding officer, exercised the discretion to heed the request of the prosecution to issue a subpoena duces tecum to help them obtain the evidence they wanted in the face of proscriptions by laws of the land passed by Congress.

And that is the subject matter now of the case before the Supreme Court filed by a private party asserting its rights under the laws of this country and under the Constitution to be protected from any liability, and that is the reason for which the Supreme Court issued a TRO.

And that is the reason why this court, or a majority of this court, yesterday ruled, in an open, uninfluenced voting that the court must respect the order of the Supreme Court to issue its temporary restraining order.

Whether or not in the end this court abused its discretion or committed a grave abuse of discretion amounting to lack of or excess of jurisdiction will be decided… by the Supreme Court being the highest court of the land and the final arbiter and interpreter of the Constitution of this country.

But the speech of the Senate President apparently alarmed, in turn, not only some of his colleagues, but other observers:

Another senator, speaking on condition of anonymity, expressed concern over Enrile’s stand, coming as it does at a time when the bank accounts of Corona are being scrutinized.

If, for example, the impeachment court allows the bank records to be admitted as evidence and the defense disagrees on grounds that they are inadmissible because they were illegally obtained, the latter could go to the Supreme Court to seek relief. There would be no stopping the High Court from suppressing such evidence, especially given Enrile’s stand that the High Court can review Senate decisions prior to final verdict, according to the senator.

Interlocutory matters may refer to all impeachment court decisions prior to its final judgment on the case, he added…

A private lawyer, speaking on condition of anonymity because she is not authorized by her firm to speak about the impeachment, also shared the same concern. “He is in effect conceding that the Supreme Court is higher than the impeachment court. He is weakening impeachment as a mechanism for public accountability.”

In the meantime, the energy of the defense In the hearing has been devoted to rectifying the blunder it made. Here’s an interesting commentary, see The veteran and his rookie mistakes:

Then came Justice Cuevas’ cross-examination which began quite ordinarily. He merely asked the witness if she had spoken with the prosecution prior to the hearing, and about possibilities on whether transactions on the accounts could have been numerous and in small amounts (as if there is need for a witness to testify on such an obvious fact). From out of the blue, and apparently without careful thought, Justice Cuevas then asked the witness if the defense panel could be allowed to review all the monthly bank statements of the account of the Chief Justice (which were originally not part of the subpoena). As we all know by now, any official request for inspection made in the course of trial has to be with the participation of opposing party and should fully transparent to the Impeachment Court and the general public. For all intents and purposes, therefore, this was a waiver of his secrecy to any and all details of his clients’ bank account, which the defense had fought hard to prevent. This would also highlight the disparity in the treatment of the BPI account from the PSBank accounts, which the Chief Justice continues to fight hard to block. Moreover, this inspection opens the door for all questions on all entries in the bank statements including what possible transactions could have given rise to the same, where the funds may have come from, what was the reason for a possible deviation from his usual transaction, etc. Of course, all this should be of no issue to those who have nothing to hide.

Looks like the defense is already reeling from this major mistake. Even before the end of the hearing on February 9, 2012, Justice Cuevas was already backtracking and saying that the Chief Justice had phoned one of his co-counsels and that the inspection may no longer be necessary. Too late. By requesting for it (through counsel), the Chief Justice already waived his right to the secrecy of deposits and the prosecution and the Impeachment Court can now compel the production of the said documents. If the defense belatedly blocks it, this will give rise to the presumption that the evidence would be adverse to it.

So the defense is headed in the only direction it can –to try to score points by means of technicalities. Why technicalities? Instead of disclosure, it is trying to throw a veil of secrecy both on information already disclosed, and to prevent further information from coming to light. Whether or not this gives the impression of someone with something to hide, is expendable so long as conviction can be prevented.

The defense believes it can bog things down in the Supreme Court so far as dollar deposits are concerned; the problem of peso deposits can, technically, be solved if the defense can convince the Senate to decree that the peso accounts cannot be considered, too. Their strategy hinges on a copy of supposed bank documents having been submitted by the prosecution; the question, the defense asks, is whether this is a faithful copy of the original. If so, then it brings up the question of how those documents reached the hands of the public. The Senate President’s line of questioning in this regard is revealing: either it was filched from the bank, or it was leaked by bank officials. Seizing on this, the defense will advocate that the peso account information be considered fruit of the poisonous tree –but this was dispensed with in the Estrada impeachment as properly in the realm of criminal trials, which impeachment is not.

Whatever happens, the defense can now pursue the strategy of making jabs at the prosecution, on senators it considers dangerous, and then waging a second campaign on the same points, this time in the Supreme Court. Emboldened by the Senate’s decision on the TRO, it has filed more petitions before the Supreme Court. But again, what is not in question is that there are peso accounts, and the contents of those peso accounts. Dollar accounts exist, but any details about them are up in the air while the Senate dukes it out in the Supreme Court.

The defense gives the impression that questions over the authenticity of the xeroxed documents that materialized and which were attached to the prosecution’s motion for a subpoena. The documents –a specimen signature card, account data sheet, and copy of the Chief Justice’s passport– are being hotly debated now, as mentioned above. What is not debatable anymore, are the bank accounts, or their balances as of specific dates, since these were confirmed by the bank’s president himself. As I mentioned earlier, the defense tried to lay the grounds for the accounts and related information to be dismissed as inadmissible –but this gambit failed after the Senate President stepped in and pointedly remarked that to question the subpoena would be to question his leadership of the chamber.

Today, we can expect the defense to continue its counteroffensive, though the message of the defense and its client haven’t been in synch. What is interesting is that there has been far less of the crowing one would expect –perhaps on the sobering realization, on the part of the defense, that it has conceded the battle for public opinion, since its tactics implicitly concede actual guilt. And that the battle still has to be actually fought in the Supreme Court, which could results in precedents and decisions that are powerful indeed. As one blogger opines, The Supreme Court will lose in a constitutional crisis.

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