Court won’t issue final ruling on public audit of Shell income

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Sunday, February 3, 2013


THE Court of Appeals (CA) will not issue yet a final ruling on the request of Pilipinas Shell Petroleum Corp. not to open its books for public audit, pending the Supreme Court’s action in a related case.

In an eight-page resolution, the CA’s Former Special First Division held in abeyance its ruling on Shell’s motion for reconsideration, in view of the pendency of a similar suit lodged before the high court, citing judicial courtesy.

The oil giant is seeking the CA’s resolution of its motion for reconsideration seeking to reverse the April 27, 2009 ruling of Judge Silvino Pampilo Jr. of Branch 26 of the Manila regional trial court, which ordered the country’s three biggest oil firms – Shell, Petron and Chevron – to open its book of accounts for scrutiny of three agencies of the government, the Bureau of Internal Revenue, Bureau of Customs and the Commission on Audit.

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The CA likewise turned down Shell’s petition to set the case for hearing in order for it to “make a judicious evaluation of the pending incidents in the present action.”

In questioning the CA’s March 21, 2011 resolution, Shell alleged that the CA erroneously applied the principle of judicial courtesy in this case, “considering that there is no legal impediment for this Court to continue exercising jurisdiction over the same and none of its judicial acts are being questioned or reviewed by the SC that would warrant deferral of its action.”

But the appellate court also said that the issue of the companies’ book audit over the Manila RTC’s assailed April 27, 2009 order is also a subject of a similar case filed by the three government agencies through the Office of the Solicitor General before the High Court, docketed as GR No. 188760.

Thus, the CA said, to make a judgment on Shell’s motion while the same issues are being tackled in the SC would render the latter’s ruling moot and academic.

In suspending its proceedings on the case, the CA held that judicial courtesy dictates for it to give way for the SC to rule on the matter first, even if there is no writ of preliminary injunction or TRO issued by the higher court “for practical and ethical considerations.”

“We simply cannot proceed to resolve petitioner’s April 8, 2011 motion for reconsideration at this time. The nullification by this Court of the proceedings in the lower court would result in the nullification of, among others, the April 27, 2009 and May 5, 2009 Orders of the RTC, which are the very subject matter of GR No.188760, now pending at the SC,” the CA ruled through Associate Justice Vicente Veloso.

“The principle of judicial courtesy applies where there is a strong probability that the issues before the High Court would be rendered moot and moribund as a result of the continuation of the proceedings in the lower court or court of origin,” the CA added.

Concurring with Veloso were Associate Justices Jane Aurora Lantion and Rodil Zalameda.

The case stemmed from the complaint filed in 2008 by the Social Justice Society (SJS) before the RTC seeking to compel the “Big 3” to open up their books of accounts for examination by the government agencies to determine whether they were engaged in monopoly and predatory pricing and cartelization, in view of the spate of oil price hikes at that time.

Records showed that in August 6, 2010, the CA granted the petition filed by Shell seeking the reversal of the April 27, 2009 order of Judge Pampilo, which granted SJS’s petition to open the oil firm’s books of accounts.

But in a ruling in 2011, the appellate court suspended the implementation of its decision, noting the existence of a similar case pending before the high court, prompting Shell to file a motion for reconsideration.

While the relief sought in the petition before the SC is different from the case in the CA, which assails the continued assumption of jurisdiction of Judge Pampilo over the case, the appellate court pointed out that “a necessary consequence in determining the order’s validity involves the resolution of the same issues raised and passed upon” by it in the August 6, 2010 decision. (JCV/Sunnex)

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