Lucio Tan so much in the Tangled web in Philippines' impeachment saga

Asia Times 0ctober 31, 2003
Southeast Asia

Tangled web of Philippines' impeachment saga

By Miriam Grace A Go

MANILA - As the Philippines' chief magistrate, impeached last week over alleged malversation of hundreds of millions of pesos in judicial funds, has temporarily prevented his own trial and is being continuously projected by his supporters as a saint who should be spared the venom of politics, there is a story about a controversial businessman-cum-kingmaker worth recalling.

It is the story of tobacco, beer and banking tycoon Lucio Tan with whom Supreme Court Chief Justice Hilario Davide Jr, 67, reportedly has a cozy relationship. It is a story that may reveal much about the kind of person Davide is, and what kind of political games he is capable of playing.

The first chief magistrate to be impeached in Philippine history, Davide is, after all, still a politician - an assemblyman from the vote-rich province of Cebu whom dictator Ferdinand Marcos allowed to win in 1978 in an election where all oppositionists were cheated; and an impeachment presider in 2001 whom some sectors cajoled into running for president come 2004.

If he proves to be deft enough to exploit the expression of support of political, business and Catholic religious leaders and organizations and permanently put a lid on efforts to try him in an impeachment court, Davide may help institutionalize the rule of "people power" in resolving conflicts that could otherwise be addressed by Philippine laws and democratic institutions.

Since the constitutionally questionable ouster of president Joseph Estrada in 2001, foreigners had observed in many published articles that mob rule - or the gathering of an angry crowd of several thousands in the streets - had become the norm in Philippine society every time events were unfavorable to a certain clique (read: the Makati Business Club, the Catholic Church, and the political camp of former president Corazon Aquino).

So the story was: Three months before Estrada was forced out of office in January 2001 by some 300,000 people mobilized primarily by Manila's elite, the actor-turned-politician had a falling-out with his crony, Lucio Tan.

Before that, Tan had already been amply rewarded for being the biggest contributor in Estrada's campaign in 1998: the government dropped the P26 billion (US$472.7 million) tax-evasion case filed against him by the previous administration, and government had intervened to ensure his takeover of the national flag carrier, Philippine Airlines (PAL), and to help his efforts to gain control of the state-owned Philippine National Bank.

However, on October 30, 2000, with cronyism being proclaimed in protest rallies as one of Estrada's sins, the president made a promise of advancing the date of the opening of Philippine skies to foreign carriers. It was a turnaround from a previous act of suspending the air pact between Taiwan and the Philippines to favor Tan's PAL, because Taiwanese carriers, by their passenger capacities and the frequency of their stopovers in the Philippines on their way to North American destinations, were expectedly eating away a huge part of PAL's potential earnings.

In no time, Tan was reported to be bankrolling the anti-Estrada movement, even communicating directly with the husband of then vice president Gloria Macapagal-Arroyo, who would automatically take over once Estrada was out.

The 1987 constitution provides three clear bases for the vice president to succeed the president before the latter's six-year term ends: that the president has resigned, expressed in a letter to Congress; that Congress has declared, in writing, the president to be permanently incapacitated; or that the president has died. None of these had happened, but Justice Davide, who was a member of the commission that drafted the constitution, nevertheless swore in Arroyo as president.

Anti-Estrada forces hailed Davide for putting the national interest over the debt of gratitude he owed Estrada, who appointed him to the highest judicial post in 1998.

The credentials that Davide brought with him to the Supreme Court included the many important positions he held in government: his membership in the Constitutional Commission in 1986; his chairmanship of the Commission on Elections in 1988; his chairmanship of the fact-finding commission that investigated the series of coup attempts against the government in 1989. To these positions, he was appointed by president Corazon Aquino. It was Aquino who eventually named him as Supreme Court justice in 1991. In 2001, Aquino was one of the leaders of the oust-Estrada movement.

In 1998, the one who recommended to Estrada that Davide be named the chief justice was Lucio Tan. In 2001, because of the "open skies" policy that Estrada adopted against Tan's airline interests, Tan had turned his back on Estrada.

Simply put, there was a possibility that Davide could have acted unfavorably against Estrada, even if that meant going against the constitution, to side in that political battle with the people to whom he owed his position in the tribunal. Yet the connection seemed to have escaped political observers.

And so Davide's name remained untarnished by suspicious dealings, and his perceived integrity remained intact - until his impeachment by congressmen who belonged mostly to the Nationalist People's Coalition (NPC), a political party formed by Eduardo Cojuangco Jr who, like Tan, was an Estrada crony.

On October 23, the resolution to impeach Davide was signed by 94 members of the House of Representatives, more than the one-third vote they were required to muster from the chamber of around 220 members. Davide was being charged for misusing a total of P825.84 million ($15 million) of the Judicial Development Fund (JDF) from 2000-02.

The JDF is a fund established by the late dictator Ferdinand Marcos' Presidential Decree 1949. It consists of fees collected by the courts throughout the country, but whose disposition rests solely on the chief justice. The decree is clear that 80 percent of the fund should be allocated as employee benefits, paid directly to them. Twenty percent "shall be used for office equipment and facilities of the courts located where the legal fees are collected".

Documents obtained by NPC lawmakers from the Commission on Audit (COA) showed that every year, from 2000 to 2001, employee benefits in the form of cost-of-living allowance (COLA) that Davide approved and released were less than 80 percent of the JDF. On the average, the shortage was 18 percent of the mandatory annual releases; last year, the discrepancy reached 35 percent.

While incomplete benefits were given to court employees, Davide allegedly exceeded the 20 percent limit on expenditures on equipment and facilities, which included the purchase of luxury vehicles for the justices and the construction of their vacation houses in Baguio City in the north.

However, their basis of computation is debatable. They computed the 80 percent COLA based on the balance of the JDF each year, which ranged from P1.74 billion to P1.86 billion. But in computing the disbursements for the equipment and facilities, which allegedly exceeded the 20 percent limit, they based it on the collection in those three years - meaning, in addition to the balance of the fund - which totaled only P200 million.

With a different basis for the composition of the JDF, which will derive a 20 percent equivalent to only P40 million, it would appear that the total disbursements for equipment and facilities of P229.68 million was much more than the P40 million allowed.

If the 20 percent is computed based on the JDF balance amounting to P5.4 billion in those three years, the P229.68 million actually disbursed for equipment and facilities would be less than 20 percent cap.

Still, it appears that improprieties have been committed in relation to the Judicial Development Fund. For one, Davide's son sits on the committee that decides which construction companies and suppliers should get the contracts for the projects funded by the JDF - then the payment for such contracts will be approved and released by Davide, the father, alone. This son, Joseph Bryan Hilary, is also director of the Philippine Judicial Academy Development Center Inc, a private entity that does business with the Supreme Court.

Even granting that Davide didn't allow disbursements of the JDF in excess of the 20 percent allowed for equipment, there is the question of why the disbursements were not made for court equipment and facilities in the localities where the funds were collected - they were instead spent, in violation of the presidential decree, almost entirely on the requirements of the justices and the facilities of the Supreme Court in Manila.

As congressional rule goes, the articles of impeachment should be transmitted immediately to the Senate, which will turned into an impeachment court. Before the articles of impeachment could be transmitted, however, pro-Davide camps joined in by former president Aquino and current President Arroyo - the same groups that worked for Estrada's ouster in 2001 - held rallies in the congressional compound and initiated backroom negotiations with leaders of the House of Representatives.

As the congressmen-proponents of the impeachment were being promised that Congress would be allowed to exercise oversight powers over the highly discretionary judicial funds if they dropped the impeachment, the 15-member Supreme Court this Tuesday issued an en banc resolution calling on Congress "to maintain the status quo" - in other words, instructing the House of Representatives not to transmit the articles of impeachment to the Senate, and the Senate not to accept the transmittal. In the resolution, the Supreme Court ordered lawmakers to defend their actions before the tribunal next Wednesday against petitions filed by Davide's sympathizers to stop the impeachment trial.

Although the House leadership feared that the Supreme Court's action "could usher in a constitutional crisis", they nevertheless adjourned Congress's session until November 10, an act that enraged the Senate leadership.

These events unravel a chief justice who will stubbornly refuse to submit himself to a trial. Based on his pronouncements, too, he can be a person who, because of stature, will be slighted if anybody dared question the wisdom of his actions.

Lawyers are questioning the constitutionality of the NPC-initiated impeachment against Davide. The constitution prohibits the initiation of impeachment proceedings against the same official within a year - a provision that this impeachment case clearly violated. This is because the NPC-initiated complaint was filed before the House threw out the first impeachment complaint against Davide, the one filed by former Estrada against Davide and 11 other justices for swearing in Arroyo as president.

If Davide's camp focuses on this point, they will defeat the impeachment proceedings - in any forum. However, focusing on this technicality to have the complaint thrown out will leave allegations of his alleged corruption like an ax hanging over his head - the complaint, after all, can be filed again after the one-year prohibition. Some lawyers' organizations, in fact, have harped on this constitutional prohibition, but remained silent on allegations of fund misuse against Davide.

So for starters, Davide's Supreme Court shed off proprieties and entertained petitions by his sympathizers questioning the constitutionality of his impeachment, and consequently issuing a diplomatically worded temporary restraining order on Congress. The Supreme Court in effect seized the authority of the Senate, as an impeachment court, to determine whether the impeachment done by the House was unconstitutional.

Davide has also invoked the doctrine of separation of powers between the three co-equal branches of government: the executive, the legislature, and the judiciary. In a letter to Speaker Jose de Venecia Jr on September 30, when he sensed that an impeachment complaint against him was being readied, Davide said that by asking the Supreme Court to submit documents pertinent to judicial fund, and asking knowledgeable court personnel to submit data under oath, Congress was committing "an open breach of the doctrine of separation of powers".
Davide was mum about the separation of powers when the Supreme Court instructed Congress to halt the impeachment proceedings.

In refusing to open the JDF to congressional inquiry then, the chief justice also invoked a constitutional provision that guarantees the fiscal autonomy of the judiciary to ensure its independence. His explanation on this provision gave the impression that what he does with the judicial fund cannot be questioned by anybody - even by Congress, which makes the appropriations.

What the constitution actually means by financial autonomy of the judiciary is for that branch of government to be ensured that its budget every year will not be lower that the previous one. Ironically, Davide should have been the one to know that it was the intent of the constitution because he, in 1986, was the chair of the constitutional commission's committee on legislative power, and a member of the committees on the executive power and on the judiciary.
Davide, in his letter, also seemed to equate the judiciary with democracy. He told the Speaker: "This unprecedented inquiry may be the beginning of the destruction of our democratic institutions especially the judiciary, which is the last bulwark of democracy and the sentinel of the rule of law." Until now, however, Davide has yet to call as democratic and lawful his act of swearing in Arroyo as president due to political pressure.

Caught on television cameras on his way to the shrine where an anti-Estrada crowd had amassed for three days in 2001, Davide told reporters that he was going to swear in Arroyo as "acting president". He was then acting on a request by Arroyo, and the resolution giving him the authority to do so was made by the Supreme Court justices two days after the swearing-in. When the Arroyo camp published an edited oath that removed the word "acting", thus making Arroyo president permanently, Davide didn't go out of his way to correct this.

Davide, in fact, has a record of changing his interpretation of the law when political expediency has dictated it. In 1986, for instance, he was one of those in the Constitutional Commission who voted that the party-list system of electing some members of the House of Representatives would be open to all kinds of political parties and organizations, and that it wouldn't be a reserved-seat system for representatives of so-called marginalized sectors of society.

In 2001, groups involved in the anti-Estrada movement went to the Supreme Court to ask for the disqualification of party-list winners that didn't represent nor belong to the marginalized sectors like them. The tribunal ordered the disqualification, even listing requirements for party-list participants that were not in the law. Davide approved the decision, which completely contradicted the intent of the provision that he voted for in 1986.

Interestingly, one of the winning parties disqualified from the party list as a result of the Supreme Court's decision was the Nationalist People's Coalition, where most of the congressmen who impeached him belong.

Although party-list nominees of the NPC who were affected by the decision had been threatening in private gatherings to impeach Davide, the chief justice's supporters are convinced that the NPC action against Davide was spurred by the Supreme Court's decision last December 14 that said the coconut-levy funds that NPC founder Cojuangco had been using as his private money was "prima facie public funds".

The coco-levy fund, which now amounts to P100 billion, was collected from coconut farmers throughout the country during the time of Marcos to establish a common fund for the development of the industry - something that resembles the nature of the Judicial Development Fund.

Through political and business maneuverings, the coconut fund ended up being used to buy Cojuangco's personal shares in big businesses, such as San Miguel Corp and the United Coconut Planters Bank. To a much lesser scale, but improper nevertheless, the JDF has been used, with Davide's approval, to ensure the personal comfort and convenience of the justices.

Except in a few publications, Davide's version of the impeachment story has dominated news in Manila. His sympathizers' preventive strike is that journalists who will come up with anti-Davide or anti-Supreme Court stories have most likely been bribed by Cojuangco's or the NPC's camp.
Two major television stations, however, on Tuesday braved the odds and aired a story that some congressmen allegedly received P2 million each in exchange for withdrawing their signatures from the impeachment complaint against Davide. Who was the source of the alleged bribe money, according to human-rights advocate and now Estrada lawyer Rene Saguisag? Why, businessman Lucio Tan.

(Copyright 2003 Asia Times Online Co, Ltd. All rights reserved.

This Chinaborn, lowborn economic Lucifer had said in August 28, 2002 (refer to PDI "Hope maker sees no hope for the country, blames politics") that one major reson why the country don't progress because of politics, politics and politics. But look how he meddle in politics to keep on going with his evil interests. Imagine, even the "Mr. Kortina" Chief Justice Hilario Davide was even his creation and puppet!