[A.M. OCA IPI No. 03-1865-RTJ. February 2, 2005]

MANICAD vs. TIPON

SECOND DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated FEB 2 2005.

A.M. OCA IPI No. 03-1865-RTJ (Conrado L. Manicad vs. Judge Artemio S. Tipon, Presiding Judge, Regional Trial Court, Branch 46, Manila.)

Acting on the Report of the Office of the Court Administrator (OCA) dated November 26, 2004, to wit:

REASON FOR AGENDA: On 16 September 2003, Atty. Conrado L. Manicad filed with the Office of the Court Administrator his VERIFIED AFFIDAVIT-COMPLAINT subscribed and sworn to on 10 September 2003 charging Judge Artemio S. Tipon with Gross Ignorance of the Law, Conduct Unbecoming a Judge, Bias and Partiality and Abuse of Authority relative to a case which originated from the Securities and Exchange Commission, SEC Case No. 09-97-5759 entitled "F.U. Juan Corporation, et al. vs. Rafael Roxas and Heirs of Eugenia Roxas, Inc. ('HEVRT for brevity)," now docketed as Civil Case No. 01-699671.

The Facts of Civil Case No. 01-699671:

The aforementioned civil case, which was endorsed to the Manila RTC (Branch 46) in January 2001, is a petition for the dissolution of HEVRI and the appointment of its receiver with a prayer for the issuance of preliminary injunction. Among the allegations presented by petitioner F.U. Juan Corporation was the mismanagement of HEVRI through unauthorized and fraudulent disbursements of funds by one of its officers, Rafael J. Roxas.

During the hearing of the application for preliminary injunction, Judge Artemio S. Tipon issued an Order dated 26 July 2001 directing that an audit of the books of HEVRJ be conducted to determine whether or not there was mismanagement of the said corporation necessitating the issuance of an injunction. The respondents filed a motion for reconsideration stating that the order constitutes a prejudgment not only of petitioner's application for the issuance of a writ of preliminary injunction but of the entire case as well. The motion for reconsideration was denied on 10 September 2001 on the ground that an audit of HEVRI's books and records was the best way to determine if there was a need for the issuance of a preliminary injunction.

On 04 October 2001, Judge Tipon designated Financial Catalyst, Inc. to audit the books of HEVRI and directed the officers of HEVRI to cooperate with the auditing firm and to provide all the necessary support to accomplish its duty. On 23 October 2001, Financial Catalyst, Inc. reported that the officers of HEVRI failed to respond to its request for access to the corporation's records.

On 26 October 2001, the officers of HEVRI filed a Petition for Certiorari and Prohibition with the Court of Appeals (CA) questioning the orders dated 26 July 2001, 10 September 2001 and 04 October 2001, and charging Judge Tipon with grave abuse of discretion amounting to lack or excess of jurisdiction. An injunctive relief was also prayed for to restrain Judge Tipon from proceeding with the case, particularly with the enforcement of the aforestated orders.

On 9 January 2002, Judge Tipon, motu proprio, ordered the officers of HEVRI, namely, Guillermo Roxas, Ma. Eugenia Vallarta and Rafael J. Roxas, to appear before his court on 25 January 2002, and to show cause why they should not be held in contempt of court for their refusal to allow Financial Catalyst, Inc. to audit the books of HEVRI. A motion for reconsideration was filed by the respondents on the ground that their Petition for Certiorari and Prohibition with the Court of Appeals dated 26 October 2001 was then pending and that Judge Tipon had no basis for the issuance of the show cause order.

On 26 April 2002, an Order was issued denying the respondents' motion for reconsideration for being a reiteration or amplification of exactly the same issues previously raised in the incidents for the appointment of an auditor and for the issuance of a show cause order. The respondents were again directed (for the last time) to allow Financial Catalyst, Inc. access to the books of accounts, corporate records and related papers of HEVRI immediately upon receipt of the order.

Pursuant to the Order dated 26 April 2002, Alba Romeo & Co., audit investigators of Financial Catalyst, Inc., wrote the respondents wherein they requested for access to the records of HEVRI in order that an audit survey could be undertaken. The audit survey was a procedure that had to be undertaken prior to the submission of an audit engagement proposal and the actual audit examination of the financial records. In his Reply dated 14 May 2002 to Alba Romeo & Co., Rafael J. Roxas explained that the persons having custody over the pertinent records of the corporation were its treasurer, Ma. Eugenia Vallarta, and president, Guillermo Roxas. Although both were currently out of the country, Rafael J. Roxas gave the assurance that he would try to locate the records of the corporation. He also explained that the more recent records were kept in their office in Calauan while the old records had already been archived.

In its Letter dated 16 May 2002, Alba Romeo & Co. asked Rafael J. Roxas if they could inspect the available records in the office in Calauan in the meantime that the old corporate files were being located and gathered. Rafael J. Roxas, in his Answer dated 20 May 2002, stated that Ma. Eugenia Vallarta was still out of the country while Guillermo Roxas was on leave. He added that the accountant stationed in the Calauan office resigned on 15 May 2002. He explained that he was presently in charge of the marketing office and had no authority over the accounting department of the corporation.

On 6 June 2002, the respondents filed a Motion dated 3 June 2002 questioning the qualifications and integrity of Financial Catalyst, Inc. to audit HEVRI and demanded that they be allowed to select an auditor of their own choice. During the hearing the following day, Judge Tipon gave the counsel of the respondents the profile of Financial Catalyst, Inc. and allowed the said counsel to conduct her own investigation or verification of the designated auditing firm. The counsel of the respondents was also told that they could choose from any of the three other auditing firms: (1) Sycip, Gorres and Velayo; (2) Joaquin Cunanan; and (3) Araullo and Punongbayan, provided they advanced the auditing fees. The petitioners opposed the respondents' demand to choose their own auditing firm, pointing out that the respondents never challenged the qualification of Financial Catalyst, Inc. in their petition with the Court of Appeals.

A formal hearing was scheduled on 28 June 2002 to enable the respondents to defend themselves against the charge of the petitioners that the former should be cited for contempt for their clear and insidious attempt to avoid compliance with the court order dated 26 July 2001. A day before the scheduled hearing, the respondents filed their Motion to Cancel the Hearing on the ground that their counsel was about to undergo surgery at the Makati Medical Center. Judge Tipon denied the respondents' motion to cancel the hearing and considered the contempt charge submitted for resolution.

On 16 July 2002, the Court of Appeals issued a temporary restraining order directing Judge Tipon to refrain from implementing his order to audit the books of HEVRI.

On 19 August 2002, respondents Guillermo Roxas, Ma. Eugenia Vallarta and Rafael J. Roxas were declared in contempt of court for their continued refusal to obey the orders of the court and the issuance of the warrants for their arrest was ordered. The motion for reconsideration filed by respondents was denied on 17 September 2002.

In October 2002, the respondents filed an Urgent Petition for Certiorari and Prohibition with the Court of Appeals questioning the handling of the contempt proceedings by Judge Tipon.

Considering that the TRO issued by the Court of Appeals on 16 July 2002 expired on 14 September 2002 without a writ of preliminary injunction being issued, Judge Tipon issued an Order dated 6 February 2003 directing Financial Catalyst, Inc. to proceed with the audit of the books of HEVRI.

On 21 March 2003, Judge Tipon scheduled a hearing on 4 April 2003 to give an opportunity for respondents to defend themselves against the contempt charge. Subpoenas were issued to the respondents on 25 March 2003. The petitioners presented their witness, offered their evidence and rested their case. The counsel of the respondents asked for continuance in the presentation of her clients' evidence. On 11 April 2003, the counsel of the respondents informed the court that her services had been terminated. Thereupon, the court directed the respondents to secure the services of new counsel. Judge Tipon gave the respondents until 30 April 2003 to engage a new counsel. On 5 May 2003, Atty. Conrado L. Manicad appeared as counsel for the respondents. Judge Tipon set the continuation of the hearing on 23 May 2003 during which none of the subpoenaed respondents appeared. Atty. Manicad admitted that the non-appearance of his clients was upon his own advice.

The next scheduled hearing on the contempt charge was on 19 June 2003 wherein counsel stated that he could not present evidence. Again, none of the subpoenaed respondents appeared, whereupon Judge Tipon considered the incident submitted for resolution and on 23 June 2003 ordered the implementation of the Order dated 19 August 2002 directing the issuance of warrants of arrest against the respondents.

The hearing of the main case was set on 15 August 2003. Again, counsel and respondents failed to appear. Atty. Manicad claims that no formal notice was given and that he only received a long distance phone call from someone who identified herself as an employee of the RTC (Branch 46). On the day of the hearing, he sent a messenger to file his Manifestation that he already had a previously scheduled hearing in Las Piñas. At this point, Atty. Manicad was declared in contempt of court, fined thirty thousand pesos (P30,000.00) and sentenced to three (3) days of imprisonment. The issuance of warrants of arrest against Atty. Manicad and the respondents was ordered.

The Charges

The complainant, Atty. Conrado L. Manicad, charges Judge Artemio S. Tipon with (1) gross ignorance of the law; (2) conduct unbecoming a member of the bench; (3) bias and partiality; and (4) abuse of authority.

The charge of gross ignorance of the law is based on Judge Tipon's orders with respect to the contempt case against Atty. Manicad and his clients (respondents in the civil case). At the hearing on 19 June 2003, Judge Tipon declared the matter submitted for resolution when Atty. Manicad failed to present evidence and not one of his clients appeared for the hearing. When Atty. Manicad and his clients were declared in contempt of court and warrants of arrest against them were issued, they filed a notice of appeal and motion to fix bail. Both notice and motion were denied on the ground that the said decision had long become final and executory as early as 19 August 2002 when no appeal therefrom was filed. Atty. Manicad now questions the purpose of holding the hearing on the contempt case, particularly the presentation of evidence being required of them, if such was the case.

Atty. Manicad also claims that he received no formal notice of the hearing on the main case scheduled on 15 August 2003. He avers that he merely received a long distance telephone call from one of the court employees to inform him of the hearing. He professes that he was not sure of the veracity of the scheduled hearing conveyed only by a telephone call. Also, he maintains that he already had hearings scheduled on the said date at the RTC San Pablo City, RTC Calamba and RTC Las Piñas. He gave priority to his hearing at RTC Las Piñas since the case thereat involves about forty (40) people and would inconvenience a lot of people should the case be postponed. He asserts that he sent a messenger on the day of the hearing to file his Manifestation stating the foregoing reasons. Despite the filing of the manifestation, Judge Tipon declared him guilty of contempt of court, sentenced him to three (3) days of imprisonment, fined him thirty thousand pesos (P30,000.00) and ordered his clients arrested.

Atty. Manicad declares that ordering his arrest and that of his clients for "failure to appear despite notice when, in truth and in fact, there was no notice specially as far as the three defendants are concerned is GROSS IGNORANCE of the law if only for his failure to realize that he did not have that such power of arrest unless there is personal notice."

Atty. Manicad, likewise, stresses that considering their case is civil in nature, Judge Tipon should have, at the most, either declared the former's clients in default, considered the case submitted for decision, or forfeited any rights his clients were entitled to enforce had they been present at the 15 August 2003 hearing instead of ordering all of them in contempt and issuing warrants for their arrest. Atty. Manicad contends that for such an imaginary infraction, the imprisonment and fine imposed upon him is "GROSS IGNORANCE OF THE LAW pure and simple."

With respect to the charge of conduct unbecoming a member of the bench, Atty. Manicad charges Judge Tipon with "vindictiveness, tyranny and inhuman despotism" in denying the motion to quash the warrants for the arrest of his clients considering that the latter were not furnished notice of the 15 August 2003 hearing. The complainant accuses the respondent judge of having purposely delayed the resolution of the motion until his clients were arrested and subjected to the indignities the complainant himself suffered when he was detained for three (3) days. ,

In addition, when Atty. Manicad was arrested and imprisoned, a motion to fix bail was filed on the second day of the complainant's imprisonment in order to spare him another day of detention. According to Atty. Manicad, the hearing for the motion was reset three (3) days after it was filed, "as if the Court were confronted with a petition for bail for an unbailable crime" which resulted in his completion of the three-day detention without the court being able to decide whether or not he had the right to bail.

As to the charge of bias and partiality, Atty. Manicad cites the actuation of Judge Tipon during the hearing on 23 May 2003 wherein the latter kept on interrupting the complainant, not allowing him to finish his sentences. The complainant claims that the counsel of the adverse party, however, was allowed to speak eight (8) times, seven (7) of which had no direct bearing on the issues under discussion. The complainant claims that Judge Tipon himself spoke forty-one (41) times and even delivered a speech at one time.

The charge of abuse of authority centers on the undue exercise by Judge Tipon of his contempt powers. Atty. Manicad argues that to be adjudged in contempt by the court over the failure of a counsel and/or party to appear in a civil case is not only too drastic a sanction but improper, particularly when the fundamental requirement of a notice of hearing is absent. He maintains that one who is held guilty of contempt has the right to appeal and the constitutional right to bail, both of which was denied him by the respondent judge.

For having exercised his power of contempt in such arbitrary manner, the complainant, Atty. Manicad, thus, prays for the dismissal of the respondent judge from the judiciary.

The Comment on the Charges

In his 2nd Indorsement dated 27 October 2003 containing his comment, Judge Artemio S. Tipon declares that all the acts complained of have absolutely no factual or legal basis. He contends that the statements made by Atty. Manicad in his affidavit-complaint are false, malicious and leave a distorted picture of the circumstances that led to the issuance of the warrants of arrest against the complainant and his clients.

Judge Tipon explains that on 19 August 2002, he had already declared Guillermo Roxas, Ma. Eugenia Vallarta and Rafael J. Roxas, respondents being represented by Atty. Manicad in the instant civil case, in contempt of court. The issuance of their warrants of arrest, however, was deferred to give the respondents opportunity to comply with the order of the court to have HEVRI's books audited. The respondents not only failed to comply with the order but also failed to appear during the hearings when their presence was required. Despite the fact that the order for the issuance of the warrant of arrest had long become final and executory, Judge Tipon issued another Order dated 23 March 2003 setting the contempt charge for hearing on 4 April 2003 to afford the respondents one final opportunity to prevent their arrest. The date of the hearing was re-set several times due to various reasons including the withdrawal of the counsel for the respondents and the engagement of the complainant as the new counsel.

On 5 May 2003, the complainant entered his appearance and the continuation of the contempt hearing was re-set to 23 May 2003. During the hearing on said date, Judge Tipon reports that Atty. Manicad, "with a proud mien admitted in open court, in the presence of the opposing party and of judicial officers, that he had advised his clients not to appear in court despite the lawful subpoena sent to them." Despite what Judge Tipon calls as Atty. Manicad's arrogance, another opportunity was given to them by setting another hearing on 19 June. Again, Atty. Manicad not only failed to present evidence but his clients did not appear as well.

Judge Tipon charges Atty. Manicad with having violated the Canons of Judicial Ethics and his oath of office in his determined effort to thwart the audit of the books of account of HEVRI under the management of his clients. The Canons of Judicial Ethics mandate that a lawyer owes candor, fairness and good faith to the court and require him to observe the rules of procedure and not misuse them to defeat the end of justice. Aside from the obvious delaying tactics employed by Atty. Manicad, he has, likewise, advised his clients to deliberately disobey the subpoenas by advising them not to attend the hearings.

As to the claim of Atty. Manicad that he received no formal notice of the 15 August 2003 hearing on the main case, Judge Tipon counters that had he attended the 1 August 2003 hearing, he could have learned that the hearing had been re-set to 15 August 2003. In any case, Atty. Manicad was advised both in writing and by telephone call in case the written notice should not arrive on time. He never notified the court nor mentioned during the telephone call that he had another hearing in Las Piñas. Upon verification with the RTC court at Las Piñas, the court learned that the hearing Atty. Manicad attended was a mere motion for extension to file answer by the defendants and that he did not even enter his appearance as he was merely counsel for one of the plaintiffs. It was also discovered that the hearing on the main case was actually scheduled on 26 August 2003.

Judge Tipon debunks Atty. Manicad's claim that the issuance of the warrants of arrest against the latter and his clients stemmed from their failure to appear during the 15 August 2003 hearing on the main case. Judge Tipon explains that Atty. Manicad was held in contempt of court and the warrant of arrest against him was issued not because of his failure to attend the hearing on 15 August 2003 but "for having directed his clients to disobey a subpoena sent to them precisely to enable them to explain why they do not want to open the books of the corporation for audit." The warrants of arrest against the clients of the complainant were issued not only for disobeying the subpoenas issued to them to appear at the hearing, but also for their continuous refusal to have the books of HEVRI audited.

With respect to the charge of Atty. Manicad that Judge Tipon always interrupted him, never allowing him to finish what he was going to say and was clearly biased for and partial to the adverse party, the latter contends that he merely told Atty. Manicad to stop repeating the same arguments that he has made before. Judge Tipon does not deny that his patience was wearing thin because of the patent dilatory tactics of the complainant.

Finally, Judge Tipon argues that if he were truly guilty of the charges made by the complainant, then the Court of Appeals would have not upheld all his Orders, including those involving the contempt case against the complainant's clients.

Contending that the acts complained of have no factual or legal basis, Judge Tipon prays for the dismissal of the complaint for lack of merit. He also urges that Atty. Manicad be disbarred for violating the Canons of Judicial Ethics and his oath of office.

EVALUATION: After a thorough review of the records of the case, this Office believes that Judge Tipon cannot be held liable of the acts complained of as to warrant an administrative sanction. From the aforestated facts, it appears that the respondent judge faithfully complied with the procedure on contempt outlined in Rule 71 of the Revised Rules of Court contrary to the claims of the complainant.

The orders issued by the respondent judge are very clear and straight to the point, precluding any occasion for misunderstanding. The arrest warrants were issued not because of the non-appearance of the complainant and his clients during the hearing on the main case but because of their continuous refusal to obey the orders including the subpoenas issued by the court. The complainant insists that the respondent judge showed his ignorance of the law and acted with abuse of authority when the latter ordered the issuance of warrants of arrest against the complainant and the latter's clients for their non-appearance at the hearing on the main case on 15 August 2003. It is quite apparent that the complainant is being deliberately obtuse in his efforts to deceive or gain an unfair advantage over the matter.

The clarity with which the respondent judge was able to show through his comment together with the corresponding documentary evidence exposes the baseless character of the complainant's action against him. After a perusal of the entire records of the case, it cannot be said that the respondent judge rendered himself, in any way, liable for any disciplinary action. It is the complainant who has made himself vulnerable to the very same accusations he has hurled against the respondent judge.

In fact, no less than the Court of Appeals stated that the actions of Judge Tipon are in order. It must be noted that on 14 August 2003, the Court of Appeals rendered its decision on the consolidated Petitions for Certiorari and Prohibition with Temporary Restraining Order/Writ of Prohibition filed by the respondents in the instant civil case. In the said decision, the Court of Appeals declared the petitions bereft of merit, affirmed all the questioned orders of Judge Tipon and directed him to proceed with the trial of the case and resolve the same with deliberate dispatch.

It is surely the Court of Appeals decision that propelled the complainant to file the administrative complaint against the respondent judge a month later as a last resort to circumvent the impending audit which his clients have so desperately avoided.

It is, therefore, apparent that the instant administrative complaint was filed to further delay the proceedings. This observation is proven by the fact that it has been two (2) years and nine (9) months since the order was issued to audit the books of account of HEVRI. It cannot also be discounted that the filing of the complaint was a puny vindictive attempt on the part of Atty. Manicad for having been, in his belief, wrongfully incarcerated as a consequence of his having been declared in contempt of court.

RECOMMENDATION: In view of the foregoing, we respectfully submit for the consideration of the Honorable Court the following recommendations:

1.That the instant administrative complaint against Judge Artemio S. Tipon be DISMISSED for utter lack of merit.

2.That Judge Tipon be REQUIRED to formalize his charge against Atty. Conrado L. Manicad for causing the filing of this complaint and subjecting respondent judge to the trouble and harassment of an unfounded accusation and for conduct unbecoming of a member of the legal profession.

The findings and recommendation of the OCA are well taken.

It must be stressed that the acts of a judge in his judicial capacity are ordinarily not subject to disciplinary action. He cannot be subjected to liability - civil, criminal or administrative - for any of his official acts, no matter how erroneous, as long as he acts in good faith.[1] Thus, disciplinary proceedings and criminal actions against magistrates do not complement, supplement or substitute judicial remedies, whether ordinary or extraordinary. An inquiry into their civil, criminal and/or administrative liability may be made only after the available remedies have been exhausted and decided with finality. In fine, only judicial errors tainted with fraud, dishonesty, gross ignorance, bad faith, or deliberate intent to do an injustice will be administratively sanctioned.[2] To hold otherwise would be to render judicial office untenable, for no one called upon to try the facts or interpret the law in the process of administering justice can be infallible in his judgment.[3]

As observed by the OCA, the Court of Appeals itself in its Decision dated August 14, 2003 in CA-G.R. SP Nos. 67384 and 73187[4] upheld the validity of the contempt proceedings initiated by Judge Tipon against the petitioners therein. The appellate court ruled that Judge Tipon even gave the petitioners a chance to be heard in open court on the contempt charges against them, which hearing, however they failed to attend.[5]

Indeed, while it is our duty to investigate and determine the truth behind every matter in complaints against judges and other court personnel, it is also our duty to see to it that they are protected and exonerated from baseless administrative charges. The Court will not shirk from its responsibility of imposing discipline upon its magistrates, but neither will it hesitate to shield them from unfounded suits that only serve to disrupt rather than promote the orderly administration of justice.[6]

The Court has recognized the need to protect members of the Judiciary from clearly unfounded or malicious administrative or criminal cases filed merely for purposes of harassment, and issued A.M. No. 03-10-01-SC[7] which took effect on November 3, 2003. It reads in part:

1. If upon an informal preliminary inquiry by the Office of the Court Administrator, an administrative complaint against any Justice of the Court of Appeals or Sandiganbayan or any Judge of the lower courts filed in connection with a case in court is shown to be clearly unfounded and baseless and intended to harass the respondent, such a finding should be included in the report and recommendation of the Office of the Court Administrator. If the recommendation is approved or affirmed by the Court, the complainant may be required to show cause why he should not be held in contempt of court. If the complainant is a lawyer, he may further be required to show cause why he or she should not be administratively sanctioned as a member of the Bar and as an officer of the court.

Considering that the complaint in the instant case was filed before the effectivity thereof, the Court in the instant case resolves to ADOPT the recommendation of the OCA and REQUIRE Judge Artemio S. Tipon to formalize his charges against Atty. Conrado L. Manicad for causing the filing of this complaint and subjecting him to the trouble and harassment of an unfounded accusation, and for conduct unbecoming of a member of the legal profession.

The administrative charges against Judge Artemio S. Tipon are DISMISSED for utter lack of merit.

Very truly yours,

(Sgd.) LUDICHI YASAY-NUNAG

Clerk of Court

[3] Sacmar v. Reyes-Carpio, 400 SCRA 32 (2003).

[4] Entitled Rafael J. Roxas and the Heirs of Eugenia V. Roxas, Inc., v. Hon. Artemio S. Tipon, F.U Juan Corporation and Fernando U. Juan and Rafael J. Roxas, Guillermo Roxas and Ma. Eugenia Vallarte v. Hon. Judge Artemio Tipon. These were consolidated petitions for certiorari and prohibition with prayer for the issuance of temporary restraining order and/or writ of preliminary injunction filed under Rule 65 of the Rules of Civil Procedure.

[7] Entitled “Resolution Prescribing Measures To Protect Members of The Judiciary From Baseless and Unfounded Administrative Complaints.”