Feb 1 Senate impeachment court record

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WEDNESDAY, FEBRUARY 1, 2012 1

At 2:02 P.M., THE PRESIDING OFFICER, SENATE PRESIDENT JUAN PONCE ENRILE,

CALLED THE IMPEACHMENT TRIAL OF SUPREME COURT CHIEF JUSTICE RENATO C.

CORONA TO ORDER.

The Presiding Officer. The continuation of the Impeachment Trial of the Honorable Supreme

Court Chief Justice Renato C. Corona is hereby called to order.

We shall be led in prayer by the distinguished Senator from Bukidnon, Senator Teofisto Guingona III.

Senator Guingona.

Mula sa Banal na Kasulatan: “Pinagpala ang mga nagugutom at nauuhaw sa

katuwiran sapagkat sila ay bubusugin.” “Blessed are those who hunger and thirst for

justice, they shall have their fill.”

Samahan Po Ninyo akong manalangin.

Ama naming makapangyarihan sa lahat, masdan Po Ninyo ang aming bansa na

nauuhaw sa katotohanan, nauuhaw sa katuwiran, nauuhaw sa katarungan. Masdan Po

Ninyo ang mga bagay na lalong nagpapatindi ng aming uhaw: ang pagkamakasarili,

ang pagkakanya-kanya, ang pag-una sa pansariling interes bago interes ng bansa,

ang pagmamagaling, ang kayabangan, ang sinasadyang pagtatago sa katotohanan.

Sa araw na ito, naririto naman Po kami sa Bulwagan ng Senado para sikaping

mapatid namin ang aming uhaw, ang uhaw para sa katotohanan, para sa katuwiran,

para sa katarungan. Pagpalain Po Ninyo ang paghahanap namin ng pampatid ng

pagkauhaw. Paglinawin Po Ninyo ang aming mga isipan para din maging mas malinaw

sa amin kung alin ang totoo at alin ang kasinungalingan. Paglinawin Po Ninyo ang

aming mga pag-unawa para maging mas malinaw sa amin kung alin ang tunay na tinig

Republic of the Philippines

Senate

Record of the SenateSitting As An Impeachment Court

Wednesday, February 1, 2012

Pasay City



2 WEDNESDAY, FEBRUARY 1, 2012

___________________

*On sick leave

ng katotohanan at kung alin ang ingay lamang ng pagmamagaling at paglilinlang.

Paglinawin Po Ninyo ang aming mga puso para sa lahat ng aming gagawin at pag-

uusapan ay mangibabaw ang interes at pagmamahal namin sa aming bayan.

Sa lahat Pong ito, Panginoon, maunawaan Po sana namin na ang paglilitis na

aming ginagawa ay bahagi ng grasya at ng pagbibigay Mo sa amin ng pampatid ng

tumitindi naming uhaw. Huwag Mo Pong payagan itapon at sayangin lamang naminang malamig na tubig ng katotohanan na binibigay Mo sa amin. Mangibabaw Po sana

ang katuwiran sa araw na ito at sa lahat ng araw ng aming buhay.

Ito ang aming hiling sa ngalan ng Inyong Anak na Siyang daan, katotohanan at buhay.

Amen.

The Presiding Officer. Amen.

The Secretary will now please call the roll of Senators.

The Secretary, reading:

Honorable Senator Edgardo J. Angara .............................................. Present

Senator Joker P. Arroyo ................................................................... Present

Senator Alan Peter “Compañero” S. Cayetano ................................. Present

Senator Pia S. Cayetano ................................................................... Present

Senator Miriam Defensor Santiago .................................................... Absent*

Senator Franklin M. Drilon ................................................................ Present

Senator Jinggoy Ejercito Estrada ....................................................... Present

Senator Francis J.G. Escudero .......................................................... Present

Senator Teofisto L. Guingona III ....................................................... Present

Senator Gregorio B. Honasan II ........................................................ Present

Senator Panfilo M. Lacson ................................................................ Present

Senator Manuel “Lito” M. Lapid ....................................................... Present

Senator Loren Legarda ...................................................................... Present

Senator Ferdinand “Bongbong” R. Marcos Jr. .................................. Present

Senator Sergio R. Osmeña III ........................................................... Present

Senator Francis N. Pangilinan ............................................................ Present

Senator Aquilino L. Pimentel III ........................................................ Present

Senator Ralph G. Recto .................................................................... Present

Senator Ramon “Bong” Revilla Jr. ..................................................... Present

Senator Vicente C. Sotto III ............................................................. Present

Senator Antonio “Sonny” F. Trillanes IV........................................... PresentSenator Manny Villar ......................................................................... Present

The Senate President ......................................................................... Present

The Presiding Officer. With 19 Senator-Judges present in the Chamber, the Presiding Officer

declares the presence of a quorum.

The Floor Leader.

Senator Sotto. Mr. President, may I ask the Sergeant-at-Arms to make the proclamation.




The Presiding Officer. The Sergeant-at-Arms is directed to make the proclamation.

The Sergeant-At-Arms. All persons are commanded to keep silent under pain of penalty while

the Senate is sitting in trial on the Articles of Impeachment against Chief Justice Renato C. Corona.

The Presiding Officer. The Secretary will please call the case before the Senate sitting as an

Impeachment Court.

The Senate Secretary. Case No. 002-2011, In the Matter of Impeachment Trial of Honorable

Chief Justice Renato C. Corona.

Senator Sotto. Mr. President.

The Presiding Officer. Appearances.


The Presiding Officer. The Floor Leader.

Senator Sotto. Before that, I move to dispense with the reading of the January 30 and January

31, 2012 Journals of the Senate sitting as an Impeachment Court and consider the same as approved.

The Presiding Officer. Any objection? [Silence] The Chair hears none. The Journal for the

January 30 and January 31, 2012 Senate hearing sitting as an Impeachment Court is considered

approved.

Senator Sotto. We are ready for the appearances, Mr. President.

Representative Tupas. Good afternoon, Mr. President, Your Honor. For the House of

Representatives Prosecution panel, same appearance.

The Presiding Officer. Noted.

The Defense?

Mr. Cuevas. For the Defense, Your Honor, the same appearance.

The Presiding Officer. Noted.

The Floor Leader?

Senator Sotto. Mr. President, we now call on the Prosecution for the continuation of the

presentation of evidence on Article II.

The Presiding Officer. The Prosecution may now proceed in the presentation of its evidence

in chief.

Representative Tupas. Your Honor, we now have our first witness for today, the name is

Mr. Benito Cataran, Director of the Securities and Exchange Commission. And may we request that

Congressman Rey Umali be recognized. He will conduct the direct examination for the Prosecution.

The Presiding Officer. Proceed.

The Secretary. Director Cataran, please raise your right hand.

Do you swear to tell the truth, the whole truth and nothing but the truth in this Impeachment

Proceedings?




Mr. Cataran. Yes, Ma’am.

The Secretary. So help you God.

Representative Umali. With the permission of this Honorable Court.


Mr. Cuevas. If Your Honor please, if there are other witnesses inside the courtroom who will

not be testifying, may we request that they be temporarily excluded?

The Presiding Officer. If there are witnesses for the Prosecution who are inside the Chamber

as a courtroom, the Chair requests that you go to the waiting room until you are called to come into

this Chamber to testify.

Representative Umali. Thank you, Your Honor. There is none, Your Honor.

Mr. Cuevas. Thank you.

The Presiding Officer. All right, proceed.

Reprsentative Umali. Mr. Witness, will you please state your name and other personal

circumstances?

Mr. Cataran. I am Atty. Benito Cataran, 64 years old, married, resident of Pacita I, San Pedro,

Laguna, and presently the director of the Company Registration and Monitoring Department of the

Securities and Exchange Commission.

Representative Umali. Thank you, Mr. Witness.

Your Honors, we offer the testimony of the witness to prove the following: that he is the director

of the Company Registration and Monitoring Department of the Securities and Exchange Commission;that he has been such director of the said department since 1980; that his department and that the

primary functions thereof include registration of corporations, partnerships and other juridical entities,

monitoring of compliance with government laws, rules and regulations and submission of reportorial

requirements as well as the custody of the records pertaining to corporations and other juridical entities,

particularly the reportorial documents and actions taken on said corporations—

The Presiding Officer. Proceed and qualify your witness by letting him recite those things into

the record as a basis for cross-examination by the Defense, if the Defense so wishes.

Representative Umali. Yes, Your Honor. If I may just continue, Your Honor.

He will testify on the fact of the company called Basa-Guidote Enterprises Inc. being given acorporate franchise. That the enterprise—the corporate franchise of this company was revoked by

SEC in May of 2003.

The Presiding Officer. Counsel, please elicit those facts from the witness to be recorded.

Representative Umali. Yes, Your Honor.

The Presiding Officer. The Counsel is reminded that he is not under oath to testify in these

proceedings.






Representative Umali. And just to close, Your Honor, to identify and authenticate records and

documents pertinent and relevant to his testimony, Your Honor.


Representative Umali. Mr. Witness, you identified yourself as attorney. You are a lawyer by

profession?

Mr. Cataran. Yes, Sir.

Representative Umali. And since when did you become a lawyer?

Mr. Cataran. 1975.

Representative Umali. You stated that you are currently employed with the Securities and

Exchange Commission. Since when have you been connected with the SEC?

Mr. Cataran. July 1980.

Representative Umali. Up to the present?


Representative Umali. You stated that you are currently the director of Company Registration

and Monitoring Department of SEC.


Representative Umali. Since when have you occupied this position?

Mr. Cataran. Since year 2000.

Representative Umali. And you are still occupying this position to the present time?


Representative Umali. As director of the Company Registration and Monitoring Department,

will you please tell us your functions as director?

Mr. Cataran. As director, I manage the department, oversee its operation.

The Presiding Officer. Will you please fix your microphone so that your statements are clear?

Mr. Cataran. As director, I manage the operation of the department, execute all the circulars

being implemented by the Commission.

Representative Umali. And what are the specific mandates of the Company Registration and

Monitoring Department?

Mr. Cataran. Our department is the department which registers corporations and partnerships.

We also issue licenses for foreign corporations and licenses for brokers, financing company, lending

companies. We also process and approve amendments of Articles of Incorporations.

The Presiding Officer. I think that is a matter of law that this Court can take notice of.




Representative Umali. Thank you, Your Honor.

The Presiding Officer. Proceed to the meat of your questions.

Representative Umali. Before you became director, what positions, if any, have you held in

SEC?

Mr. Cataran. I started as an Analyst I, then Analyst II. Then I was promoted as SupervisingSpecialist, then I became a Division Chief. Then later on, as Director of CRMD.

Representative Umali. Under what department, Mr. Witness?

Mr. Cataran. Under Company Registration and Monitoring Department.

Representative Umali. Considering your vast experience—a total of 32 years in SEC in the

same department which deals mainly on corporation and laws related thereto-would you reasonably say

that you have a fairly substantial knowledge of corporation?

Mr. Cuevas. Very leading, Your Honor.

The Presiding Officer. Counsel.

Mr. Cataran. Yes, Your Honor.

The Presiding Officer. Will the Defense accept the fact that this witness is an official of the

Securities and Exchange Commission in charge of corporate records?

Mr. Cuevas. Although we do not know him personally, Your Honor, we will be willing—just to

expedite the proceedings, we are willing to admit on record.

The Presiding Officer. All right. Proceed from there, Counsel.


Mr. Witness, you appear today on strength of the subpoena issued by this Honorable Court,

subpoena duces tecum—subpoena ad testificandum et duces tecum, and you were required to bring

with you original and certified true copies of the Articles of Incorporation of Basa-Guidote Enterprises

and its general information sheets and audited financial statements for the years 2000 up to 2010.

First question is, did you bring with you the Articles of Incorporation and its amendments, if any,

of this particular corporation?

Mr. Cataran. I have here only the original copy of the Articles of Incorporation, but we do not

have any copy for the amendments. They did not file any amendments of these articles.

Representative Umali. Will you please hand to this representation this document?

May I manifest, Your Honor, that we have pre-marked this before the Deputy Clerk of Court

yesterday. And witness handed to me the Articles of Incorporation, the original, of Basa-Guidote

Enterprises Inc., earlier marked as Exhibit “WWWWW”, consisting of…

Mr. Cuevas. Seven (7) pages.

Representative Umali. …seven (7) pages.

Thank you, Your Honor.




The Presiding Officer. Mark it accordingly. Is that pre-marked?

Representative Umali. Yes, Your Honor, pre-marked…

The Presiding Officer. All right.

Representative Umali. …as Exhibit “WWWWW”, the whole document. The name “Basa-

Guidote Enterprises Inc.” as Exhibit “WWWWW-A”, the subsequent pages thereof as “WWWWW-1” up to “6”, Your Honor?

Mr. Cuevas. At this juncture, Your Honor, and for expediency, may we ask permission that it

be marked also as Exhibit “39” for the Defense, Your Honor.

The Presiding Officer. Yes. Just a matter of procedure, we take note of the Defense Counsel.

Counsel, is there a need to mark the pages as exhibits? Why do you not just mark the document

as an exhibit and identify—to identify it? Anyway, you can refer to the page of that exhibit if you want

to refer to a particular page.

Representative Umali. Yes. Actually, Your Honor, we have also pre-marked the pertinentpages thereof in yesterday’s—

The Presiding Officer. All right, proceed so that we can—we do not tarry.

Mr. Cuevas. Exhibit “41”. I am sorry, Your Honor, it is not “39” but “41”. We already have

“39”, Your Honor, for the Defense.

The Presiding Officer. You adopt the same as your exhibit?

Mr. Cuevas. That is correct, Your Honor.

The Presiding Officer. All right. Let it be recorded that this particular document marked asexhibit for the Prosecution and the Defense is marked accordingly as both exhibits for the Prosecution

and the Defense.

Representative Umali. Yes, Your Honor. Thank you, Your Honor.

May we request the Defense to compare the same and manifest that this is a faithful reproduction

of the original?

Mr. Cuevas. We have examined the same, Your Honor, and we are willing to admit on record

that the document now being presented is a faithful reproduction of the original, Your Honor.

The Presiding Officer. Yes. That is an official record. This Court can even call on the custodian

to bring that kind of document. So, that should not be a problem.

Proceed.

Representative Umali. Now, may I also manifest, Your Honor, for the record—may I also

manifest for the record, that we have sub-marked Exhibit “WWWWW-3”, particularly the portion

thereof indicating the original stockholders and of the corporation, as Exhibit “WWWWW3-A”.

The Presiding Officer. Counsel for the Defense, do you accept, do you admit the stockholders

of this corporation?

Mr. Cuevas. Yes, Your Honor.




The Presiding Officer. None. Theres no need to put that.

Mr. Cuevas. No. I do not think there is any genuine controversy in connection with the existence

of the corporation and its stockholders, Your Honor.

The Presiding Officer. The document is the best evidence of its content.

Representative Umali. Yes, Your Honor. We would just like to highlight this, for the record,that Cristina Corona is not among the stockholders of this corporation and this is the reason for the

sub-marking, Your Honor.

The Presiding Officer. Why do you not ask the one that brought it to read who are the

stockholders?


The Presiding Officer. And who are the members of the Board of Directors.

Representative Umali. I will go into that, Your Honor.

Showing to you a copy, Mr. Witness, of Exhibit “WWWWW-3”, will you please read to the

record the names of the stockholders and directors of this company.

Mr. Cuevas. I do not think there will be any reason for the reading, Your Honor. We are

admitting—

The Presiding Officer. Let the witness read.


Mr. Cataran. Based on the Articles of Incorporation of Basa-Guidote Enterprises Inc., these are

the stockholders: Rosario G. vda. de Basa, Mario Basa, Cecilia Basa, Vicente Roco, Asuncion Basa

Roco, Jose Ma. Basa and Raymunda Gorospe Basa.

That is all, Your Honor.

The Presiding Officer. And who are the directors?

Representative Umali. And the directors.

The Presiding Officer. Who are the directors?

Mr. Cataran. The directors, there are seven (7), namely: Rosario G. vda. de Basa, Mario Basa,

Cecilia Basa, Vicente Roco, Asuncion Basa Roco, Jose Maria Basa and Raymunda Gorospe Basa.

The Presiding Officer. All right. Proceed.

Representative Umali. Now, Mr. Witness, what proof, if any, do you have to show that this

corporation was registered with the Securities and Exchange Commission?

Mr. Cuevas. Improper for direct, Your Honor. You already—

The Presiding Officer. That is not a pertinent question. After all, it is a matter of record. It is

registered with the SEC.

Representative Umali. Yes, Your Honor. This is just the Articles of Incorporation, Your Honor.

The SEC registration is different from the Articles of Incorporation.




The Presiding Officer. All right. Proceed. Answer.

Mr. Cataran. I have here the original copy of the Certificate of Registration, Your Honor.

Representative Umali. I am showing to you a copy of the Certificate of Registration No. 1884—

The Presiding Officer. Never mind, Counsel. I suggest that you show it to the witness and the

Court directs the witness to read it into the record.

Representative Umali. Showing to you a copy, Mr. Witness, of this Certificate of Registration,

is this the same document that you mentioned?


Representative Umali. And will you please read into the records this particular exhibit marked

as Exhibit “XXXXX”?

Mr. Cataran. All these?

Representative Umali. The name and the registration number and the date.Mr. Cataran. “To All To Whom This Presence May Come:

Greetings!

“WHEREAS, Articles of Incorporation duly signed and acknowledged for the

organization of Basa-Guidote Enterprises Inc., under and accordance with the provisions, the

Act of Philippine Commission No. 1459”—

Representative Umali. If Your Honor please. Just the name, the date and the registration

number.

Mr. Cataran. The date of registration is 30th day of May 1961 and this is signed by—

The Presiding Officer. What year?

Mr. Cataran. 1961, Your Honor.

The Presiding Officer. 1961.

Mr. Cataran. 1961. This Certificate of Registration was signed by Securities and Exchange

Commissioner Mariano G. Pineda.

Representative Umali. Thank you.

Now, you were also required, Mr. Witness, to bring with you pursuant to the subpoena, theGeneral Information Sheet or GIS of Basa- Guidote Enterprises Inc. for the years 2000 to 2010. Did

you also bring this with you?

Mr. Cataran. We did not receive those reports.

Representative Umali. Will you amplify that point, Mr. Witness?

Mr. Cataran. Since we have no reports on general information and financial statements as you

requested, I just prepared a Certificate of Non-Filing, if this Court will accept.

The Presiding Officer. What reports were requested?




Representative Umali. The reports, Your Honor, covering the General Information Sheet

covering the periods 2000 up to year 2010, Your Honor.

Mr. Cuevas. We would like to know, with the kind permission of the Honorable Court, we would

like to know...

The Presiding Officer. Proceed.Mr. Cuevas. …the materiality, the pertinency and the relevancy of all these documents, Your

Honor. Because up to now we are at a loss in deciphering or defining what is the reason or the

materiality—

The Presiding Officer. Let us proceed and let us see what is the connection of this corporation

with this proceeding.

Mr. Cuevas. Okay. Thank you, Your Honor.

Representative Umali. You mentioned that you executed a Certificate of Corporate Filing

Information. Mr. Witness, what is the relation of this document to the document you mentioned?Mr. Cataran. Just to prove that we did not receive any documents. Meaning, those reports

you requested.

Representative Umali. Meaning, the General Information Sheet for the years 2000 to 2010 are

what, Mr. Witness?

Mr. Cataran. May I read this Certification?

Representative Umali. Yes, please.

Mr. Cataran. “To whom it may concern:

‘This is to certify that the records of Basa-Guidote Enterprises Inc. with SEC No. 18884

on file with this Commission show that said corporation did not file its General Information

Sheet and Financial Statements from 2000 to 2010.”

Then, my signature.

Representative Umali. So you mentioned—May we manifest, Your Honor, that this document

was pre-marked as our Exhibit “EEEEEE”. The name Basa-Guidote Enterprises as Exhibit “EEEEEE-

A,” and the signature of Benito Cataran, Exhibit “EEEEEE-B”. Whose signature is that, Mr. Witness?

Mr. Cataran. This is my signature.


May I request the Defense to review the documents and compare the same to the original?

Mr. Cuevas. Okay. If the purpose is substitution, Your Honor, we have no objection.

The Presiding Officer. Then it is not objected to. So proceed, Counsel.

Representative Umali. Now, Mr. Witness, when you determined that the documents being

requested were not present in your record, what other actions did you take, if any, to find out

compliance of certain reportorial requirements by this corporation?




Mr. Cataran. We checked our corporate file to determine if there are other reports submitted

by the corporation.

The Presiding Officer. Will you please fix your—

Mr. Cataran. I checked on the corporate file to check if there are other reports submitted by

the corporation other than those requested.Representative Umali. And what did you find out, Mr. Witness?

Mr. Cataran. We found out that since 1991 the corporation has not been submitting any report,

meaning they did not file this General Information Sheet.

The Presiding Officer. From what year to what year?

Mr. Cataran. From 1991.

The Presiding Officer. Witness, from what year to what year?

Mr. Cataran. Up to—

The Presiding Officer. From?

Mr. Cataran. 1991 up to 1997.


Mr. Cataran. Actually it is not—kasi what happened is that—

The Presiding Officer. Just answer the question please. From what year?

Mr. Cataran. We found out that the corporation has not been submitting reports from 1991 up

to the time we revoked the Certificate of Registration of such corporation...

The Presiding Officer. Okay.

Mr. Cataran. …in 2003, Your Honor.

Representative Umali. Now, you said that they have not been reporting since 1991. Would

you have any reports submitted—General Information Sheet submitted as existing in your record, Mr.

Witness?

Mr. Cataran. There are GIS or General Information Sheets on our file.

Representative Umali. What is the latest General Information Sheet submitted and recorded inyour file?

Mr. Cataran. The latest GIS we have on file is that of 1990.

Representative Umali. Do you have a copy of this General Information Sheet?

Witness handed to me a copy of the General Information Sheet as of July 16, 1990 of

Basa-Guidote Enterprises Inc. which, may I manifest for the record, Your Honor, has been marked

as Exhibit “YYYYY”, the names of the directors and trustees thereof as—

The Presiding Officer. Trustees?




Representative Umali. Yes, Your Honor, this is what appears in the document, Your Honor.

The Presiding Officer. All right, go ahead.


Will you please read to the record the names of the directors and trustees as appearing in this

document?

Mr. Cataran. Jose M. Basa III, Randy Basa, Concepcion Basa, Flor Maria Basa, Asuncion B.

Roco, Vicente Roco, as directors.

Representative Umali. And may—

The Presiding Officer. Why did they use the term “trustees”?

Mr. Cataran. No. Actually, Sir, this is a form where it is indicated “the Board of Directors/

Trustee.” They are supposed to cross out the “Trustee” because trustee refers to non-stock. It so

happened that they did not cross the term “Trustee.”

The Presiding Officer. Yes. The Chair asked that because the term “Trustee” would mean that

the corporation is in the process of liquidation.

Mr. Cataran. No, no, Sir, kasi this form—

The Presiding Officer. Or does that mean trustees for non-commercial corporations?

Mr. Cataran. Yes, Sir, because these are general forms which non-stock corporations can use.

For non-stock, they usually use the term “Trustees” instead of “Directors.” So if they have this form

and it is a non-stock, all they have to do is to cross the term “Director” if they are using the term

“Trustee.” But in this case it so happened that—

The Presiding Officer. Oh, anyway, that is a legal issue. Please proceed.

Representative Umali. Will you please also read into the records the names of the corporate

officers as appearing in this Exhibit?

Mr. Cataran. The corporate officers are: Jose M. Basa, Chairman and President; Randy Basa,

Vice President; Mario Basa Jr., Vice President; Melissa Basa, Secretary/Treasurer.

Representative Umali. On the dorsal portion of this appears the names of the stockholders. Will

you also please read into the records the names of the stockholders appearing therein?

Mr. Cataran. Jose M. Basa, Rose Raymunda Basa, Cecilia H. Basa, Concepcion Basa, FlorMaria Basa, Asuncion Basa-Roco and Vicente Roco.

Representative Umali. Thank you, Mr. Witness.

And may I request, Your Honor, that—may I propose to stipulate, Your Honor, that this exhibit

which was earlier marked as “YYYYY”, the names of the board of directors as “YYYYY-A”, the

names of the directors bracketed as Exhibit “YYYYY-B”, the names of the stockholders as—the

dorsal portion as Exhibit “YYYYY-1” and the names of the stockholders appearing in the dorsal

portion of Exhibit “YYYYY” as Exhibit “YYYYY-1-A”?

And I would like to request the Defense to compare with the original.




May we propose a stipulation on the matter with the Defense?

Mr. Cuevas. Very willingly, Your Honor. We admit, Your Honor, that what is being presented

is the faithful reproduction of the original.


Representative Umali. Thank you.

Now, Mr. Witness, did you also bring with you, pursuant to the subpoena, the copies of the

financial statements of Basa- Guidote Enterprises Inc. for the years 2000 to 2010?

Mr. Cataran. We did not receive any financial statements within that period.

Representative Umali. So these documents do not exist on your file?


Representative Umali. Are there documents, financial statements appearing in your files with

the Securities and Exchange Commission?Mr. Cataran. None.

Representative Umali. And what is the repercussion of this non-filing of the GIS and/or financial

statements, Mr. Witness?

Mr. Cuevas. That will be asking for an opinion, Your Honor, and the witness has presented—

Representative Umali. I will withdraw, Your Honor.

The Presiding Officer. What is the position of the—

Representative Umali. I withdraw, Your Honor. I withdraw the question.The Presiding Officer. You are withdrawing the question?



Representative Umali. So when it was revealed that there were no financial statements

appearing in your records nor this GIS, what action did your department take in relation to this matter,

Mr. Witness?

Mr. Cuevas. The question is vague, Your Honor. Because what actually the witness stated is,

there is nothing in the record that will show all these things. It was not a revelation, Your Honor.

The Presiding Officer. Let the witness answer. He is intelligent. He is in charge of record.

Mr. Cuevas. We submit, Your Honor.


Mr. Cataran. Well, based on the request, as I mentioned and I just presented, I just issued a

certification that we did not receive such financial statement.

Representative Umali. And so what is the effect when there was no submission of these financial

statements, Mr. Witness?




The Presiding Officer. As a conclusion of law, do you not think so, Counsel? You are drawing

a conclusion of law.

Representative Umali. Yes, Your Honor. I again will reform, Your Honor.

So what is the present status of Basa-Guidote Enterprises Inc.?

Mr. Cuevas. No basis, Your Honor. Present status simply means that there were processestaken up, and there is no showing that there were. Precisely we are about to object it.

The Presiding Officer. Let the witness answer.

Proceed.

Mr. Cataran. The certificate of registration of Basa-Guidote Enterprises Inc. is already revoked,

Your Honor.

Representative Umali. Do you have any proof of this revocation made on this corporation?


Representative Umali. Will you show me this document, Mr. Witness?

Witness handing to this representation, Your Honor, a copy of the order dated April 22, 2003,

executed by Benito A. Cataran, Director, Company Registration and Monitoring Department,

in the matter of revocation of Certificate of Registration.

What is the relation of this document to what you testified on earlier, Mr. Witness?

The Presiding Officer. Well, please make your question more specific. He testified on so

many things.

Representative Umali. Of this particular order, Your Honor.


Representative Umali. I am showing him a document, Your Honor.

Mr. Cuevas. Still vague, Your Honor, and too general.

Representative Umali. I am showing you a document, an order issued by Benito A. Cataran,

Director, Company Registration and Monitoring Department, pertaining to an order issued by you, Mr.

Witness, pertaining to corporations which were required to submit annual reports such as GIS and

financial statement pursuant to Section 141 of the Corporation Code. What is the relation of this to

the statement you made earlier, Mr. Witness?

Mr. Cuevas. The question, Your Honor, is too long. We would not know when to object and

so on. May we request that the question be simplified, Your Honor?

Representative Umali. That is as simple as it could be, Your Honor.

Mr. Cuevas. Because the witness is very intelligent witness, Your Honor.


Mr. Witness, what is Section 141 of the Corporation Law?




Mr. Cataran. This is the particular provision of the Corporation Code which requires the

submission of reports to the Commission.

The Presiding Officer. Which requires?

Mr. Cataran. The submission of General Information Sheet and financial statement.

The Presiding Officer. All right. So, that is the basis of your requirement that a corporation mustsubmit General Information Sheet and financial statements.


The Presiding Officer. All right. Proceed.

Mr. Cataran. And with this order, it is stated that because of non-filing of this report,

General Information Sheet and financial statement within a period of at least six (6) years

from the period of 1997 up to 2002, we revoked the Certificate of Registration of Basa-Guidote

Enterprises Inc.

The Presiding Officer. What is that? What is the action taken by your office?

Mr. Cataran. We stated in this order, which I signed, that the corporation has to let—may I read,

Your Honor, the order?

The Presiding Officer. No, just tell us in a nutshell what was the action of your office?

Mr. Cataran. We notified the corporations to submit reports and they have to explain within 30

days why they did not submit the reports. And it says here that after the lapse of 30 days and they

failed to comply with the requirements or to settle—

The Presiding Officer. Of Section 141 of the Corporation Code.

Mr. Cataran. Yes, Sir. We will consider their Certificate of Registration revoked.

The Presiding Officer. All right. Now, the Chair would like to posit this question: What is the

effect of that revocation of registration?

Mr. Cataran. When the corporation failed to file an appeal, it becomes effective and with

the effectivity of this order, its corporate existence is considered as none—no longer exist. Meaning,

with this revocation order—

The Presiding Officer. Wait a minute. You mean, the corporation is dissolved?

Mr. Cataran. Yes, Sir. That is the opinion of the Commission that whenever a corporation—

The Presiding Officer. Wait a minute. Let me clarify this.

Is it not that a corporation exists when it is incorporated as a person?


The Presiding Officer. That only the stockholders can dissolve it or the government through a

quo warranto proceeding?

Mr. Cataran. We have the authority—The SEC has the authority to suspend, revoke Articles

of Incorporation.




The Presiding Officer. So therefore, do you consider this corporation as a corporation in

liquidation?

Mr. Cataran. Well, since we already—

The Presiding Officer. No, no, I am asking you, because when you say, “The corporation is

dissolved,” this is not the end of the corporation.Mr. Cataran. They can still exist.

The Presiding Officer. It goes into a liquidation process.

Mr. Cataran. Yes, Sir. They have three years within which to liquidate after the date of

revocation.

The Presiding Officer. Is that a matter of record that they liquidated the corporation?

Mr. Cataran. We do not know, Your Honor.

The Presiding Officer. So you do not know whether the corporation is considered as a personfor purposes of its creditors and stockholders?

Mr. Cataran. We have opinions which say that whenever the corporate franchise is revoked

the corporation is considered dissolved.

The Presiding Officer. Well, this is a matter of law.

Under what authority in the Corporation Code is the SEC authorized to cause the dissolution of

a corporation?

Mr. Cataran. We can consider this, Your Honor, as an involuntary dissolution of the corporation

through an act by the Commission.

The Presiding Officer. There is a provision, if I remember correctly in my Corporation Law,

there is a provision in the Corporation Law regarding the dissolution and liquidation of a corporation.


The Presiding Officer. Has that been removed and changed?

Mr. Cataran. No, no. There is still a provision, Section 120 of the—

The Presiding Officer. It is still the same?


The Presiding Officer. Since the Corporation Law was adopted in the early turn of the last

century?

Mr. Cataran. Yes, Your Honor. It is still there.

The Presiding Officer. So if it has not been changed, will you kindly tell me where the SEC

draws its power to dissolve a corporation without complying—

Mr. Cataran. Your Honor, under P.D. 902-A, the SEC has the authority to suspend and revoke

Certificate of Registration—




The Presiding Officer. Suspend the operation of the corporation but you cannot kill that

corporation.

Mr. Cataran. But we can revoke its registration.

The Presiding Officer. Yes, you can revoke its right to operate. But you cannot kill it, you

cannot make it die, only the stockholders can make it die or the government, through the power of a

quo warranto proceeding, can kill it.

Are there proceedings like this?

Mr. Cataran. At present, our opinion as I mentioned—

The Presiding Officer. Anyway, proceed Counsel.

Senator Legarda. Mr. President?

The Presiding Officer. Yes, what is the pleasure of the gentlelady?

Senator Legarda. The gentlelady, Mr. President. Mr. President, I am present here.

Yes, thank you.

The Presiding Officer. Yes, the gentlelady from the Philippines.

Senator Legarda. Thank you, Mr. President.

May I just seek clarification from your statement regarding the dissolution of a corporation? May

this representation be enlightened whether the revocation of registration of a corporation is synonymous

to its dissolution?

I wonder whether it was answered by the witness. And how many years upon the non-filing of a

GIS would the SEC revoke its registration? And third, what happens to the assets or the propertiesof that corporation since the Presiding Officer said that it does not mean that the revocation of the

Certificate of Registration would actually mean the non-operation of the corporation?

Just for this representation’s enlightenment.

Mr. Cataran. We have issued the opinions. The Commission issued that with respect to

revocation of the corporate franchise, we consider the corporation as dissolved and from the date of

effectivity of revocation, the corporation has to liquidate its asset.

The Presiding Officer. This Court redirects the witness to submit a legal memorandum showing

us the authority of the Securities and Exchange Commission to consider corporation which is non-

compliant with the provision of Section 141 of the Corporation Code is authorized to dissolve it. Andwhat is the procedure of dissolution?

Senator Legarda. Mr. President, thank you for that elucidation.

May I know, Mr. President, whether it is an uncommon practice for corporations after not having

submitted their GIS to eventually have their Certificate of Registrations revoked or suspended or

revoked? And eventually after a few years, when there are corporate activities, for them to just pay

fines before the SEC and to have their corporations in active status again. Is this possible?

Mr. Cataran. There is no mention in the P.D. 902-A as to how many years before we can revoke

the Certificate of Registration of a corporation. The assumption is whether it be after one (1) year of




non-filing or two (2) years but usually as a matter of practice we revoke the registration if the

corporation has not been submitting reports—GIS and FS for at least three (3) years.

The Presiding Officer. With the permission of the lady Senator, I just want to clarify one point.

A corporation whose registration is revoked, can it be revived?

Senator Legarda. That was my question.

Mr. Cataran. Before the finality—

The Presiding Officer. No, I am asking you. Can it be revived?


The Presiding Officer. So therefore it is not dissolved because when you dissolve a corporation,

you kill it. You cannot revive it.

Senator Legarda. Which brings me to my question before that, which is exactly the same

question. Is the dissolution of a corporation the same as the revocation of the Certificate of Registration? And what happens to the assets of that corporation during that time after the revocation

of the registration?

Mr. Cataran. What I am saying is that the effect of the revocation of the corporate franchise is

to dissolve the corporation. Meaning it is—

The Presiding Officer. How can you revive a dissolved corporation? Under what authority?

Mr. Cataran. If the revocation order is not yet final and executory, they can be appealed. The

corporation involved can always file an appeal.

The Presiding Officer. I think your office is doing an arbitrary implementation of the Corpora-tion Law.

At any rate, the lady Senator has the floor.

Senator Legarda. Well, I support the position of the Chair, the Presiding Officer, that

perhaps the SEC can provide the Body with a legal memorandum to this effect so that we may fully

understand this.

But my question is, is this an uncommon practice?

Mr. Cataran. No, Your Honor.

Senator Legarda. Many corporations do?


Senator Legarda. The Prosecution of course has not finished its direct examination.


Senator Legarda. I just wanted to understand the revocation of the Certificate of Registration of

the Basa Enterprises and the relevance to the SALN or Article II of the Articles of Impeachment. That

was what I wanted to see because in my understanding, the Chief Justice had supposedly borrowed

money from Basa which was supposed to have gone to the purchase of real estate property for which




he paid his cash advances at the time when the corporation was supposed to be not in active status.

Is that my understanding, Mr. Prosecutor? Is my understanding correct?

Representative Umali. Yes.

Senator Legarda. Is that the point you are trying to make?

Representative Umali. Yes, Your Honor. But before that, let me just explain, Your Honors,that in the SALN of Renato C. Corona, which was hesitantly brought before this Honorable Court and

submitted to this Honorable Court pursuant to a subpoena issued by this Honorable Court, as of

December 31, 2003, there appeared in this particular SALN marked as Exhibit “C”, an entry on

liabilities, cash advance from Basa-Guidote Enterprises, Inc., wife’s family corporation in the amount

of P11 million. And likewise, in Exhibit “B”—

Senator Legarda. Thank you for that. Excuse me. That was 2003 when the Chief Justice

supposedly borrowed P11 million from Basa Enterprises?

Representative Umali. That is correct, Your Honor.

Senator Legarda. Yes, just hold there. May we ask from the SEC, during this time was Basa

Enterprises in operation or was it already dissolved using your Board Resolution of the corporation?

Mr. Cataran. We cannot say whether it is still in operation because they are not submitting

reports.

Senator Legarda. They have not been submitting reports and therefore you were not familiar

whether in 2003, when the cash advance of P11 million was made, whether the operation was on-

going of Basa Enterprises?


Senator Legarda. Yes, Mr. Prosecutor.

Representative Umali. Yes. Thank you, Your Honor.

Senator Legarda. 2003, P11 million. After which, he declared that there was a decreasing cash

advance until it was paid fully in 2010. Is that what you are trying to say?


Senator Legarda. And so between 2003 and 2010 in the SALN, was Basa Enterprises

operational or you have not received any report again from Basa Enterprises, Mr. SEC?

Mr. Cataran. We did not receive any reports.

Senator Legarda. If there is no report, what does that mean?

Oh, that is my time. Answer please, both the Prosecutor and our witness.

Mr. Cataran. Since the corporation franchise has already been revoked and we consider

that corporation dissolved, we no longer ask for the submission of report.

Senator Legarda. My time is up. I just have one question, Mr. Presiding Officer, only if

you allow.

The Presiding Officer. Go ahead.




Senator Legarda. I just want to see the point of the Prosecutor whether the payment of the cash

advance by the Chief Justice to Basa Enterprise has any relevance to the nondisclosure in the SALN

during that time. It is a corporation of the wife, the wife’s family and I want to see the connection.

But you can proceed.

Representative Umali. For one, if I may just amplify on this point, Your Honors. Our theory

is that there could not have been any transaction made by Basa-Guidote with the Chief Justice RenatoCorona because the corporation has already been—the corporate franchise has already been dissolved

or revoked and therefore, the only action that can be taken by Basa-Guidote is just to liquidate and

wind up the affairs of the corporation and distribute the shares. That is all that it could do at that point

in time. If I may just continue?



The Presiding Officer. When was the revocation issued by the SEC?

Representative Umali. April 22, 2003, Your Honor.

The Presiding Officer. 2003?

Representative Umali. Yes, Your Honor. In addition—

Mr. Cuevas. Your Honor, please.

Representative Umali. I am not through, Your Honor, if I may just continue.

The Presiding Officer. Let the Prosecution.

Representative Umali. If I may just continue, Your Honor, also in the SALN of Renato Corona,

on the dorsals portion of Exhibit “C” is an entry where Cristina R. Corona with its firm name Basa-Guidote Enterprises, Inc., wife’s family corporation declared nature of business interests/financial

connection which is real estate and this does not appear, Your Honor, in the SEC records nor in any

other records submitted in any government agency, Your Honor. That is why, this again has relevance

to the truthfulness and accuracy of the SALN which is also reflected in the SALN for 2004 marked

as Exhibit “E”, Exhibit “F”, Exhibit “G”, Exhibit “H”, Exhibit “I”, Exhibit “J”, Exhibit “K”, Exhibit “L”,

all of which are common exhibits, Your Honor.

The Presiding Officer. Anyway...

Mr. Cuevas. Now, if Your Honor—

The Presiding Officer. ...proceed, Counsel.

Mr. Cuevas. If Your Honor please—

The Presiding Officer. This will be addressed to the evaluation of the Court...

Mr. Cuevas. Yes, Your Honor.

The Presiding Officer. ...especially the effect of revocation. And assuming that the SEC has

the power to cancel—to dissolve a corporation, which I doubt, then I do not want to impose my

opinion that is why I am requesting a memorandum from the SEC. I am not imposing my opinion on

this although I entertain a great doubt whether it has the authority to dissolve a corporation.




Because my knowledge of Corporation Law suggests to me that only the stockholders can dissolve

a corporation by shortening its duration under its Articles of Incorporation and/or by quo warranto

proceeding by the State. If it violates any law, what will be the status of a corporation in dissolution?

And after the dissolution, what will be the status of the assets of the corporation? My recollection is

that, in that event, it becomes a matter of co-ownership by the stockholders.

So, anyway, proceed.

Mr. Cuevas. If Your Honor please, may the Defense be heard in connection with this? Since

what was presented on record or put into record is a mere manifestation and it has no probative or

evidentiary value, may we be heard in connection with this issue, Your Honor?

The Presiding Officer. Correct, correct.

Mr. Cuevas. All right. Thank you, Your Honor.


Mr. Cuevas. May I—in SEC Opinion dated May 4, 1995, it is stated: “The SEC has opinedthat even under Section 22 of the Corporation Code, there can be no automatic dissolution of a

corporation after its incorporation has been approved by the SEC. It shall continue to exist as a

juridical entity notwithstanding its non-operational status until its Certificate of Registration is formally

revoked by the SEC after due notice and hearing.”

We have been fed—this Honorable Court had been fed with erroneous presumption, Your Honor,

that the moment there is a Certificate of Revocation, the corporation cannot do any business anymore.

That is not true even in actuality. Supposing that the date of revocation ends up today and there is

a pending case where the corporation is involved, maybe nonpayment of wages or recovery of

properties, and it is still pending, will that mean to say that the corporation may no longer participate?

The Presiding Officer. Anyway, that is a question of law that must be resolved.

Mr. Cuevas. I am just reading from the Opinion, Your Honor.

The Presiding Officer. Yes. Go ahead.

Representative Umali. If Your Honor please, may I also be heard on...

The Presiding Officer. Proceed, proceed.

Representative Umali. ...this point?

Mr. Cuevas. I am just reading from the—

The Presiding Officer. Let the Defense Counsel finish first.


Mr. Cuevas. That is the Opinion of the SEC, Your Honor. I am just reading it for the records

because it is very enlightening on the issue involved in this particular—at this particular instance.

Thank you, Your Honor.

The Presiding Officer. Thank you.

What is the pleasure of the Prosecution?




Representative Umali. Yes, Your Honor. First of all, we take exception to the statement that

the Prosecution is feeding erroneous information to this Honorable Court.

Mr. Cuevas. Sorry.

Representative Umali. Because 14 years later, Your Honor, in SEC OGC Opinion No. 2409

dated 28 July 2009, the SEC confirmed that the mass revocation orders issued by the SEC are

immediately effective. Thus, it ruled: “We clarify that an order of revocation is immediately effective.

Once the revocation order is issued, a subject corporation’s existence is terminated at the very instant.

SEC Circular No. 4, Series of 2008, Circular No. 4 for brevity, did not suspend the covered

revocation order’s immediate effect. It only provides an additional period within which a covered

corporation may petition the Commission for lifting the revocation order. The phrase ‘final and

executory’ contained in the Circular only means that after the given period, a covered corporation no

longer has any further remedy available with the Commission against the respective revocation order.

It does not mean that the revocation order is only effective after the lapse of the period for filing the

petition to lift. To subscribe to such a view, as you submit, would render the Revocation Order inutile

and defeat its very purpose. In short, a covered corporation’s existence is deemed terminated until the

particular Revocation Order is lifted.”

The Presiding Officer. Anyway, the statement read by the Prosecution answers the question,

“How can a dead corporation petition for its revival?” So let us leave the matter at that. And that

will be taken up by this Court after we have finished the hearing. All right.

Now, the SEC is directed by this Court to submit a legal memorandum telling this Court the basis

of its authority to dissolve a corporation without the action of its own stockholders or a quo warranto

proceeding by the State.

Thank you.

Proceed.

Representative Umali. Now, Mr. Witness, after you issued this Revocation Order, what other

action of the Securities and Exchange Commission was made in connection with the revocation of the

corporate franchise of Basa-Guidote Enterprises Inc.?

Mr. Cataran. The Commission issued a circular reminding those covered corporations, those

whose Certificate of Registrations were revoked, to file within a period of one (1) year a Petition to

Lift the Revocation Order.

Representative Umali. I am showing you a copy of SEC Circular No. 15, as you testified, dated

November 5, 2009, issued by Chairperson Fe B. Barin, published in Philippine Daily Inquirer ,

November 9, 2009, and Business Mirror , November 9, 2009, what is the relation of this document

to your earlier statement?

Mr. Cataran. This indicated the date of revocation of the corporation, that is May 26, 2003.

Representative Umali. Which document, Your Honor, we have already previously marked as

Exhibit “DDDDDD”. And the first row of this document from 1936 to 1966 which includes the date

mentioned, “May 26, 2003,” as the date of revocation earlier marked as Exhibit “DDDDDD-A”. May

I request for a stipulation with the Defense Counsel on the authenticity of this document by comparing

it with the original?

Mr. Cuevas. We have no objection, Your Honor, to the issue of authenticity of the said

document. In fact, we are adopting it as our Exhibit “43”, Your Honor.




The Presiding Officer. So, that is it. Counsel, proceed.


After this Exhibit “DDDDDD” was issued by the Securities and Exchange Commission, as far as

you know, were there any action taken by Basa-Guidote Enterprises Inc. to revive the corporation?

Mr. Cataran. None. The corporation did not file any petition to appeal the Revocation Order.

The Presiding Officer. By the way, Counsel, what is the purpose of this line of questioning?

What are you trying to prove?

Representative Umali. Yes, Your Honor, we are trying to—

The Presiding Officer. You are trying to prove that this corporation is dead?


The Presiding Officer. Dissolved and that it cannot lend money?

Representative Umali. No, Your Honor. We are just saying that after the Revocation Order

was issued, the same became final and no action was taken by the corporation to revive the same, Your

Honor.

The Presiding Officer. Yes. So, in effect, what is the relevance of that fact to the proceeding?

Representative Umali. Then the only matter that can be done by the corporation is just to

liquidate the corporation and therefore—

The Presiding Officer. Yes. So what if it liquidates? What is the relevance of that fact of

dissolution to this proceeding?

Representative Umali. Then, Your Honor, the corporation can no longer transact business—

The Presiding Officer. Can no longer advance money to anybody?


The Presiding Officer. Then go to that point.

Yes, Senator from Taguig. The Minority Floor Leader.

Senator Cayetano (A). Mr. President, magandang hapon.

Can I just pursue your question, kung ano ang relevance?

The Presiding Officer. Yes.

Senator Cayetano (A). Just to clear things up. Kapagka ang korporasyon ay may ginawa

na hindi nila pwedeng gawin, ultra vires iyon di ba, labag sa batas, labag sa kanilang charter?


Senator Cayetano (A). Kung ang tao pag inutangan mo at patay na ang tao, mapapatunayan

mo hindi nagpautang iyong tao na iyon dahil patay na siya eh. It can be his estate or pwedeng

isang ano, pero iyong korporasyon pag sinabi ng SEC na patay na, ang sinasabi ninyo hindi na

pwedeng magpautang. Hindi ba irrelevant iyon? Kasi ang tanong dito hindi iyong batas ng SEC




ang pinag-uusapan natin or Corporation Law ang pinag-uusapan natin dito. Ang pinag-uusapan

po namin kung tama po, Ginoong Prosecutor , whether or not totoong meron pong P11 million

noong 2003; P11 million noong 2004; P10 million noong 2005; P8 million, 2006; 2007, P6.5 million;

P5 million noong 2008; at P3 million noong 2009. Meaning, kahit patay na iyong korporasyon

kung—eh family corporation ito eh. Kung may bank account o may pera sila, pwede pa rin silang

magpautang eh. So anong relevance kung buhay pa iyong korporasyon o hindi? Hindi po ba ang

dapat nating patunayan dito, kung totoo o hindi na nagpautang iyong corporation? Iyon ang

pinupunto natin dito, hindi kung buhay ang korporasyon o hindi. Kasi kahit patay na ang

corporation, de facto wise, you can still get the money, can still loan the money out. Can you clarify

on that matter, please?

Representative Umali. Yes, Your Honor. That is another point. What we are saying here has

a relation to the truthfulness of the entries in the Statement of Assets and Liabilities.

The Presiding Officer. Kaya nga, Mr. Counsel, ang relevancy noong sinasabi ninyo, what

is untruthful if the question is, “Did that corporation or body or group of persons lend money that is

reflected in the SALN of the Respondent?”

Representative Umali. Kaya nga po, Your Honors, ang sinasabi po natin dahil ni-revoke

na po at ang tanging pwede na lang pong gawin ng korporasyon ay i-liquidate at i-distribute to—

The Presiding Officer. We will take your opinion in advisement.


The Presiding Officer. We will take in your opinion into consideration. But you have not

established the connection of what you are saying with the present proceeding.

Senator Cayetano (A). Mr. President.

The Presiding Officer. The gentleman from Taguig has the floor.

Senator Cayetano (A). Mr. President, can I yield for a few minutes to Senator Lacson?

He wants to interject on this point.

The Presiding Officer. Yes, the gentleman from Cavite.

Senator Lacson. With the kind permission of the gentleman from Taguig.

I just want to be clarified further. Because I have a copy of Exhibit “DDDDDD” and further

“DDDDDD-A”. Ang nakalagay po rito tama, “Date of Revocation, May 26, 2003.” Hindi naman

po pwedeng sabihing patay ang korporasyon dahil merong naka-indicate sa another column,

“Deadline to file petition to lift revocation.”

Representative Umali. Tama po.

Senator Lacson. So ang tanong ko po sa SEC, ano po ang status nung korporasyon between

May 26, 2003 and May 26, 2010, ito po ba ay patay na? Kasi pwedeng i-resuscitate eh. “Deadline

to file petition to lift revocation, 2010,” so pwede pong ma-revive ito?


Senator Lacson. So active po yung corporation. Pwedeng maging active. Buhay pa po,

pwedeng naka-suwero pero buhay.




Mr. Cataran. But based on our opinion, when we revoke, it is already effective. Kasi otherwise

what is the use of revoking if it is alive, say—

Senator Lacson. But why do you have to give a deadline to file petition to lift revocation kung

sinasabi ninyong dead na?

Mr. Cataran. So that we can finalize the order but it is already effective.Senator Lacson. Thank you, Mr. President.

Thank you, Senator Cayetano.

Senator Cayetano, (A). Just to continue and finish—

The Presiding Officer. Thank you, Your Honor.

Senator Cayetano (A). May I ask the SEC director one question?

The Presiding Officer. Please proceed.

Senator Cayetano (A). Yung pong deadline hanggang 2010?


Senator Cayetano (A). Pwede po silang mag-liquidate?

Mr. Cataran. If they will not file an appeal.

Senator Cayetano (A). No, but they can liquidate their—the assets of the corporation.

Mr. Cataran. It is up to them.

Senator Cayetano (A). So is cash advances not a form of liquidation?

Mr. Cataran. I do not think so, Your Honor.

Senator Cayetano (A). Hindi, di ba kung sampu kayo sa korporasyon, may sampung milyon

iyong korporasyon, pare-pareho ang number of shares nyo, so ibig sabihin pag wala na kayong

ibang utang, ibabalik ang tig-isang milyon sa sampung shareholders. So instead nung final na

hatian, ang ibig sabihin ng cash advance, ibinigay mo na in advance iyong hati niya.

Mr. Cataran. Kung iyon po siguro ang ano nila na to liquidate, it is up to them.

Senator Cayetano (A). Anyway, my time is up.

Mr. President, I just like to say, if these questions are preliminary and the Prosecution is going into

proving whether or not may utang talaga or kung may pera or fictitious iyong pera, I can see the

relevance there. But if the point of all of these is simply to point out na patay na iyong korporasyon,

we are wasting our time because it is irrelevant. Kasi kahit patay na ang korporasyon, that does

not mean na de facto, they could have not given money to the spouses Corona.

Thank you, Mr. President.

Senator Drilon. Mr. President.

The Presiding Officer. The gentleman from Cavite.




Senator Lacson. Thank you, Mr. President.

Lalo po kaming nalabuan doon sa sagot ninyo dahil sabi ninyo effective na iyong kamatayan,

ano, sabi ninyo, revoked eh. Pero sino yung sinulatan ninyo na mag-file ng petition before the

deadline imposed? Kung patay na, kanino ninyo ini-address? No, I am just talking practical

terms, ano.

Mr. Cataran. Kasi ano po iyon eh. When we revoke, it means that it has no longer corporate

existence. That is the effect since we revoked. That is already effective. But we give the corporation

the chance to appeal the Revocation Order because it is not yet final. This is the reason for this

Circular.

Senator Lacson. Iyon nga po, doon nga kami naguguluhan, ako particularly, kasi ano po

ang status nga ng korporasyon na iyon between those two periods or within the period, I mean?

I yield to Senator Drilon.

The Presiding Officer. The gentleman from Iloilo.

Senator Drilon. Can I have two (2) minutes, Your Honor?

The Presiding Officer. You have two (2) minutes.

Senator Drilon. All right.

Mr. Witness, when a corporation’s license is revoked, am I correct in my understanding that under

Section 122 of the Corporation Code and the SEC regulations, this means that it can no longer operate

except for purposes of winding up its affairs? Is that correct?


Senator Drilon. All right. And the corporation is given three years to wind up its affairs.Is that correct?


Senator Drilon. And therefore, it cannot continue in its regular business during the three-year

period?


Senator Drilon. Now, that corporation cannot enter into a new business or perform acts in

furtherance of the business during the period of winding up. Is that correct?


Senator Drilon. And the affairs of the corporation should be limited to those which would have

a bearing to its liquidation. Is that correct?


Senator Drilon. Now, in the case of Basa Enterprises, when you revoked the certificate on May

26, 2003, it only meant that from May 26, 2003, for three years thereafter, it can no longer perform

its regular business but should only perform acts pursuant to a liquidation. Is that correct?





Senator Drilon. Now, you also mentioned that after the Guidote-Basa or Basa-Guidote

Enterprises received this Notice of Revocation, there is nothing on the record which would show that

they asked for a revival of this corporation.


Senator Drilon. So, insofar as the records are concerned, this corporation has ceased to operatebecause three years have lapsed since the time of revocation.


Senator Drilon. And that is a statement based on the SEC Reorganization Act which authorizes

you, the SEC, to revoke the Certificate of Registration for failure to file the required reports as

required by the SEC.


Senator Drilon. That is all, Your Honor.


The gentleman from Pampanga.

Senator Pangilian. Yes, Mr. President. Thank you very much.

Just a clarification to the Prosecution panel. Yesterday, you were trying to prove or you were

proving, with respect to the Statement of Assets and Liabilities, certain properties that were excluded.

That is your argument, hindi ba ...


Senator Pangilian. ... in the SALN? Therefore, for lack of a better term, mayroon mga

unexplained exclusions. In this case, there is an inclusion. Meaning, mayroong loan, may idineklara.

Yung kahapon, may mga hindi idineklara. Ngayon, sinasabi niyo, may mga idineklara subalit

yung mga idineklara, eh, questionable.

Representative Umali. Questionable, Your Honor.

Senator Pangilian. And therefore, it goes again to the issue of the truthfulness of your SALN.


Senator Pangilian. So, kung kahapon unexplained exclusions, for lack of a better term, ngayon,

ang nais niyong patunayan ay unexplained inclusions.

Representative Umali. Inclusions, yes, Your Honor.

Senator Pangilian. Yun lang po. Salamat po.


The gentleman from Aurora has two (2) minutes.

Senator Angara. Maraming salamat po, Pangulo.

Palagay ko this is all much ado over nothing, eh, sapagkat number one ho, wala namang

disagreement ang Prosecution and Defense on the authenticity of this document so, it is up to us to




draw the proper legal conclusion. So we do not have to debate the conclusion because it is up to

us. Ngayon, angconfusion rito arose from the fact that our Witness made “cancellation” of the

license synonymous with “dissolution” of the corporation.

Mr. President, you and I took Corporation Law and that is our specialty. It is the distinction

between revocation of license to operate. Revocation is entirely separate and distinct from dissolution

of the corporation. Revocation of the license to operate means cancellation of the registration butthat does not automatically result in the extinction of the corporation. Hindi ba? As Senator Drilon

explained, there is still a three-year winding up period. Why? For a very practical reason. If sinabi

mo, “ni-revoke” ko yung lisensiya mo,” patay ka na. Eh, ano ang nangyari sa suweldo ng mga

empleyado? Ano ang nangyari sa mga pautang mo sa suppliers, sa creditors? So, revocation of

registration simply means you cannot do business as usual. Your avowed purpose, corporate purpose,

you can not pursue that anymore. But can you pay out money? Well, as Alan said, you can still pay

out money because that may be part of the distribution of investment or they may have already

satisfied all creditors and they want to distribute their initial investment.

So I think that whole confusion arose from the confusion of “cancellation” and “dissolution,” Mr.

President. That is why it is important that our witness provide us a legal memo because this is, tome,—well, I have not been in practice for almost 30 years, Mr. President. But I was taught a basic

principle in Corporate Law that cancellation of the registration is entirely distinct and separate from

dissolution of a corporation. Dissolution is extinguishing the life and existence of that corporation.

That means talagang wala na. Wala ka nang magagawa.

Salamat po.

The Presiding Officer. Counsel for the Prosecution, proceed.

The gentleman from Makati and Bicol, Senator Arroyo. My senior—equal senior Senator, please.

Senator Arroyo. Thank you, Mr. President.

This is not a question. You know, I once sat at the table of the Prosecutors. If you are not sure

of your evidence, please do not present it. That is all. Like this portion, this evidence, you submitted

Exhibit quintuple whatever—”QQQQQ”, huh, “DDDDD”. It says there that you could—they could still

petition the–what is this? Yes—the decision of the revocation up to sometime in 2010. Now, why did

you mark it? In other words, they could still—So, I do not really want to ask you anything because

you have control on that.

Mr. President, could you—in the legal memorandum, could you please include—for the memorandum

that will be filed by the witness- that if there is a revocation, what happens to the creditors? What

happens to the employees? What happens to the suppliers? I mean—

The Presiding Officer. What happens to the titles of—in the name of the corporation, the funds,

shares of stock and whatever property. What happened to the books of accounts?

Senator Arroyo. And whether the rules of co-ownership under the Civil Code will now be applied

assuming that it is effectively revoked because that is obviously a family corporation, as Alan said. So

I mean… that is about all that I would like to point out.

Thank you very much, Mr. President.

The Presiding Officer. The lady Senator from Taguig.

Senator Cayetano (P). Mr. President, just a few follow-up questions.




May we ask the witness if he knows or if he does not know, then can he include in the

memorandum—the legal memorandum, the basis for the setting of the deadline to file petition? Is that

based on the Corporation Code? Because as Sen. Ping Lacson pointed out, if it has already been

revoked, then what is this extra life that is being given?

Mr. Cataran. It is not based on the Corporation Code.

Senator Cayetano (P). Okay. So it is just a decision that the SEC made to give life again to a

dead corporation?


Senator Cayetano (P). Okay. And then what I would also like to be included in your legal

memorandum, is it not possible that in fact a corporation that has been—whose certification has been

revoked, they continue to conduct business even if they are not allowed. In other words, are there

not—because I was a practicing lawyer at some point and I had so many clients who did not file their

GIS, who received memorandum-circulars from the SEC telling them that they will be revoked. But

meanwhile, all this time they are doing business. So in other words po, hindi man sila kilalanin ng

SEC na buhay sila, eh buhay sila. Sila ho ay may mga ginagawa.

That brings me to my question to the Prosecution: Is it your intention to prove that money, in fact,

did not—exchange of money did not take place? Because it appears that there are many of us who

feel that this whole discussion is irrelevant because even if the legal existence—even if the corporation

has no legal existence, it appears that circulars are being sent to them and there is a life. There is a

window for them to do something. So do you intend to prove? Because then we can continue. But if

you will just prove that this corporation does not exist, then to many of us, it seems like a futile exercise.

Representative Umali. Yes, Your Honors. What we are trying to prove is that precisely this

alleged cash advance is fictitious for so many reasons. And this is the reason why we marked in

evidence the names of the stockholders were read into the records as of the time of the last filing of the GIS in July 16 of 1990, where the name Cristina Corona or even Renato Corona does not appear.

So how can there be advances to somebody who is not even a shareholder in the corporation?

The Presiding Officer. Well, anyway—

Representative Umali. These are things that we are trying to prove, Your Honor, and we are

just trying to lay the predicate, Your Honor, because this is just one of the witnesses that will prove

many other aspects of the fictitious character of this alleged cash advance, Your Honor.

The Presiding Officer. All right. But before I forget, in your memorandum, Mr. Witness, please

indicate whether a corporation whose registration was dissolved can sue or be sued. Because that

is a very important element whether the corporation is really effective, is dissolved, because to sue or

to be sued means an assertion of rights.

Okay. Take note of that.


The Presiding Officer. All right. Proceed, Counsel.

Representative Umali. Well, I think we are through with the witness, Your Honor. We have

already established all of these records that are in place in the Securities and Exchange Commission

and we will introduce other evidence on this point at the proper time, Your Honor.





The Presiding Officer. What is the pleasure of the Defense Counsel?

Mr. Cuevas. We will—



Senator Sotto. Yes. Mr. President, may we move to suspend for 15 minutes and may we call

on the other Members of the Court to join the Senate President in the Senators’ Lounge for a short

caucus to take up a small detail in the proceedings of the Impeachment Court before the cross-

examination of the Defense.

Mr. President, I so move.

The Presiding Officer. Trial suspended.

The trial was suspended at 3:34 p.m.

At 4:08 p.m., the trial was resumed.

The Presiding Officer. Hearing resumed.

The Floor Leader.

Senator Sotto. Mr. President, we are ready for the—we are ready for the cross-examination,

Mr. President.

The Presiding Officer. The Defense Counsel may cross-examine the witness.

Mr. Cuevas. Thank you, Your Honor.

With the kind permission of this Honorable Court, Your Honor.


Mr. Cuevas. Now, I would like to be informed, Atty. Cataran—Good afternoon, Attorney.

I would like to be informed whether from the point of view of the SEC there is any difference between

cancellation, meaning revocation of license, and dissolution of the corporation, as my preliminary

question.

Mr. Cataran. We usually use the term “cancellation” with respect to cancellation of license. Let

us say, we issue license to a foreign corporation or to a broker. So we use the term “cancellation.”But with respect to “dissolution,” it refers to corporation. It can be voluntary or involuntary. That

is the difference.

Mr. Cuevas. Yes.

From the standpoint of effect, is there any difference based on the rules and regulation of the SEC?

Mr. Cataran. What do you mean? Come again?

Mr. Cuevas. From the standpoint of effect, is there any difference between a revocation of license

and dissolution? Because cancellation of license is equivalent to revocation, am I right?




Mr. Cataran. There is a difference. If we revoke—let us say, we revoke the secondary license,

meaning, the authority to operate, the primary franchise will not be affected.

Mr. Cuevas. I see. So the corporation—with the revocation, the corporation is still there only

it cannot function. Am I right in understanding you that way?

Mr. Cataran. You use the term “revocation.” What is being revoked, the secondary license

or the—

Mr. Cuevas. The secondary.

Mr. Cataran. The secondary, it has no effect. It cannot operate.

Mr. Cuevas. Correct.

Mr. Cataran. But it still exists because it has still its primary franchise.

Mr. Cuevas. Correct. So much so that if the corporation, based on the purpose of its creation,

allows it to construct buildings or other structures on a land, with the revocation issued by your office,

it can still continue with a construction, am I right?

Mr. Cataran. Revocation of the primary franchise?

Mr. Cuevas. No, cancellation.

Mr. Cataran. Cancellation. Oh, yes.

Mr. Cuevas. So that it can carry on the purposes of the corporation whether it consists of lending

money or constructing buildings, am I right?

Mr. Cataran. It depends on the authority given on the license. Meaning, if you have the license

to, let us say, to lend, that is supposed to be the secondary license. If we cancel that, you can no longer

operate your business but the corporation remains. But as to that business, no…

Mr. Cuevas. All right.

Mr. Cataran. …because you have no license.

Mr. Cuevas. Now, may I direct your attention to the secondary purposes of this corporation

known as Basa-Guidote Enterprises Inc., it states, “To lend and advance money or give credit to such

persons, firms or companies under such terms as it may thought fit, and in particular to customers,

persons and firms and companies dealing with the company and to give guarantees or become surety

for any such persons, firms or companies.”

Mr. Cataran. Have we issued a license for that purpose?

Mr. Cuevas. Well, I am referring to a very specific and particular case, the Guidote Enterprise.

In fact, this is covered by Exhibit “WWWWWW”, and that particular portion as “WWWWWW-B”,

Atty. Cataran.

Representative Umali. Objection, Your Honor. The question is vague, there is no question,

Your Honor.

Mr. Cuevas. Oh, so what is being objected to if there is no question? My golly! (Laughter)

Representative Umali. You are asking the witness to answer without a question so—




Mr. Cuevas. I thought you are objecting because there is no question, I would like to know what

are you objecting.

Representative Umali. The objection is you are awaiting the answer for something of which you

have not raised the question.

Mr. Cuevas. I have yet to see that kind of…

The Presiding Officer. Is the question—

Mr. Cuevas. Hindi pa tapos ako, eh.

The Presiding Officer. Is the question misleading?

Representative Umali. No, Your Honor, vague because he made a statement and then he was

awaiting the—

The Presiding Officer. Well, you can only object in a cross-examination…

Representative Umali. Vague, Your Honor. Vague.

The Presiding Officer. …largely on a misleading question if the Counsel is trying to mislead the

witness of having said something that he did not say. So—

Mr. Cuevas. My question in here, if Your Honor please, is what is the effect of the cancellation

or revocation of the license of this particular corporation, Basa-Guidote Enterprises, on Paragraph B

of Secondary Purposes of the Articles of Impeachment. And I read it in order to inform the witness.

The Presiding Officer. The objection is overruled.

Proceed.

I just want to posit this question to the witness Mr. Witness, if you revoke the Articles of Incorporation of the registration of a corporation, may it increase its capital through a stockholders

action?

Mr. Cataran. No more, Your Honor.

The Presiding Officer. May it be sued by creditors?

Mr. Cataran. If for the purpose of—

The Presiding Officer. May it be sued by creditors? Answer the question.


The Presiding Officer. Oh, if it is dead, how it can be sued as a corporation?

Mr. Cataran. Under Section 122, the dissolved corporation has three (3) years within which to

prosecute or defend cases.

The Presiding Officer. Can it pay its employees after you have revoked its registration?

Mr. Cataran. If it is part of liquidation, yes, Your Honor.

The Presiding Officer. If it is not a part of liquidation, it is not liquidated yet?

Mr. Cataran. Then it is not.




The Presiding Officer. I think you are misinterpreting the Corporation Law.

Suppose—I will give you an example. Suppose a corporation is engaged in insurance or, let us

say, in lending money and it does not comply with your reporting requirements and you revoked the

registration and it continues to perform its business in defiance of your order, what is your remedy?

Mr. Cataran. Well, as far as the SEC—The Presiding Officer. What is your remedy?

Mr. Cataran. We already revoked the—

The Presiding Officer. How?

Mr. Cataran. None, because we already revoked the—

The Presiding Officer. Can you close the corporation, the premises?


The Presiding Officer. Is it not your remedy will be quo warranto proceeding?


The Presiding Officer. Ah, ano, ah?


The Presiding Officer. You will not institute quo warranto proceeding?

Mr. Cataran. No, unless there is a complaint, but we never encounter such case or complaint—

The Presiding Officer. Precisely. I am sorry to tell you, I am teaching you Corporation Law.

If the corporation defies your orders, what is your remedy? Close all the offices? A bank will

not comply with its corporate responsibilities under the SEC, will you physically close the corporation?


The Presiding Officer. Then what?

Proceed, Mr. Counsel.

Mr. Cuevas. All right. With the kind permission of the Honorable Court.

May I direct your attention to SEC Circular No. 15, which had been marked as Exhibit “DDDDD”,kindly go over the same before I ask you any question.

The Presiding Officer. Just to complete my question.

Can a corporation whose registration was revoked by you sue to recover money, to recover

property or to enforce his rights?


The Presiding Officer. Okay. You proceed, Counsel.

Mr. Cuevas. Okay then, Your Honor. Thank you.




I have a pending question. Kindly go over it before I ask you.

Mr. Cataran. Opo, opo.

Mr. Cuevas. Are you through reading it, Atty. Cataran?


Mr. Cuevas. Kindly go to Page 2 and there is this name “Fe B. Barin, Chairperson.” Did

you notice that?


Mr. Cuevas. All right. Fe B. Barin was once upon a time the chief or the highest official of the

SEC, am I right?

Mr. Cataran. Yes, Sir, correct.

Mr. Cuevas. All right. Now, according to this circular, it states, “Failure to file petitions to set

aside the order of revocation with the Commission within period cited above shall render theRevocation Order final and executory.”

This does not agree with the opinion you have mentioned a while ago that the moment an Order

of Revocation is issued, that is final and executory. Am I right?

Mr. Cataran. Yes.

Mr. Cuevas. So it is your opinion over the opinion of the SEC—

Mr. Cataran. It says here, “failure to file.” But if they file, it is not final.

Mr. Cuevas. No. That is not my question. My question is, there is an Order of Revocation

because of failure to comply with your financial reporting, Your Honor.

Mr. Cataran. Yes.

Mr. Cuevas. Now, the way I understood your statement on direct examination, you made me

understood that that is already final and executory or that is not correct? You wanted to correct that?

Mr. Cataran. That is not correct.

Representative Umali. Objection, Your Honor. The question is misleading.

Mr. Cuevas. I am asking him whether my understanding is correct or not. It is only yes or

no. How could it—

The Presiding Officer. The witness may answer.

Mr. Cataran. No.

Mr. Cuevas. It is not immediately executory?

Mr. Cataran. Will you kindly repeat your question?

Mr. Cuevas. Meaning, you have issued a revocation order…

Mr. Cataran. Yes.




Mr. Cuevas. …because of noncompliance with the reportorial requirements, is that right?

Mr. Cataran. Yes.

Mr. Cuevas. Can you follow?

Mr. Cataran. Yes.

Mr. Cuevas. All right. That is not immediately executory?

Mr. Cataran. Yes. Because they still have the right to appeal.

Mr. Cuevas. All right. So it may not be immediately enforceable?

Mr. Cataran. Let me—I said before—it is not final but it is effective.

Mr. Cuevas. What do you mean final but—

Mr. Cataran. Effective, meaning—when you say revoked, the revocation order is already is

effective. We can already implement. That is the meaning of revocation. But it is not final in a sense

that they can still file a petition to lift the revocation order.

Mr. Cuevas. In the meanwhile it is given effect although it is not final. Is that what you wanted

the Court to understand?

Mr. Cataran. Yes. Yes, Your Honor.

Mr. Cuevas. So, the corporation cannot act anymore, whether it is in connection with this

business authorized under the Articles of Incorporation or not.

Mr. Cataran. Yes.

Mr. Cuevas. Is that understanding correct?

Mr. Cataran. Yes. As I said—

Mr. Cuevas. All right. So that if the corporation is engaged in a litigation, let us say recovery

of money or damages against another corporation, it may no longer act pursuant to your statement now

because it is effective immediately. Am I right?

Mr. Cataran. No.

Mr. Cuevas. What do you mean, no?

Mr. Cataran. If we allow such kind of act, then what will happen? I think the case will still

proceed.

Mr. Cuevas. Kindly understand my question. The way I understood you, based on your answer

in your answer now, the order of revocation is not final but it is effective.

Mr. Cataran. Yes.

Mr. Cuevas. So that if a corporation upon which corporation the order of revocation is engaged

in a litigation whether as a defendant or plaintiff, it must stop participating in that case because your

order is already final, is executory even if not final. Is my understanding correct?

Mr. Cataran. I do not think the court will allow that.




Mr. Cuevas. No, I am not asking you whether the court will allow. I am asking you based on

your procedure in the SEC. Can it continue appearing in the case whether as plaintiff or defendant?

The answer is no?

Mr. Cataran. Yes, because it is not related to the business. So, what is being stopped is the

operation of the business but litigation is not included.

Mr. Cuevas. Ah, I see. So, if there are activities going on after you issued or before you issued

the order of revocation, it can continue with that.

Mr. Cataran. As long as it is not part of the business of the corporation.

Mr. Cuevas. Eh how can litigation be a part of the business of the corporation? Do you have

any It is not a law office.

Mr. Cataran. That why I said, the litigation can proceed, but the business, it cannot.

Mr. Cuevas. No, but I am not asking you about the business. I gave you a very clear and specific

example. Here is a corporation, it was served with the order of revocation. You said it is not finalbut it is effective. My understanding of it, it can be implemented, right?

Mr. Cataran. Yes.

Mr. Cuevas. All right. But that corporation is engaged in a litigation before a court of justice

in the Republic of the Philippines whether as plaintiff or defendant, so it must cease to participate in

that litigation because your order is effective. Is that right?

Mr. Cataran. I do not think that is the meaning of—what we mean by this effectivity is that as

far as the revocation is concerned, it can no longer do its business for profit. But litigation, I think

it can proceed.

Mr. Cuevas. So, you gave me the impression that there are other matters upon wich the

corporation can continue acting provided it is not in connection with this business.

Mr. Cataran. Yes.

Mr. Cuevas. But in this case, specifically, let us say, loan, this sum of money, some P5 million

which is part of its business, you mean to say, it is stopped from proceeding in that case?

Mr. Cataran. If it is part of its business.

Mr. Cuevas. So, it will have to withdraw that case or have that case dismissed or what?

Mr. Cataran. Well, I do not know with the case but what I am saying is the business.

Mr. Cuevas. I am asking you because you happen to be—you happen to impress us that you

have the authority to act on this. It loaned because it is engaged in lending money as secondary

purpose. Some P5 million had been—or, let us say, P100 million had been extended by loan to another

individual. Accidentally, there is an order of revocation but there is already a pending litigation. The

corporation must stop in that case whether as defendant or plaintiff?

Mr. Cataran. I do not think it will be allowed by the court. So—

Mr. Cuevas. I am not asking you whether it will be allowed by the court. I can take care of

that but I wanted to have your opinion.




Mr. Cataran. Yes.

Mr. Cuevas. Because apparently you have testified with…

Mr. Cataran. Well, that is my opinion. I think it will not be allowed.

Mr. Cuevas. So, it will not be allowed to continue.

Mr. Cataran. No. It can continue.

Mr. Cuevas. Ah, it can continue.

So it is clear now that there are acts, there are transactions and there are events that can continue

notwithstanding the fact that there is an order of revocation.

Mr. Cataran. As long as it is not part of the business of the corporation.

Mr. Cuevas. That is your answer. All right.

Now in this particular case, you made me understood that you have examined the records of this

corporation. Will you kindly tell the Honorable Court what is the extent of that examination that youconducted?

Mr. Cataran. I just checked whether-as to the reports submitted.

Mr. Cuevas. Only.

Mr. Cataran. Yes, that is being asked whether we have to submit—in the subpoena I received—

Mr. Cuevas. I am not referring to the subpoena, with due respect.

Mr. Cataran. I checked.

Mr. Cuevas. When you examined, how far did your examination go? Did it go deeper than

examining the papers you are asked to produce by the subpoena?

Mr. Cataran. No, I just checked as to the records. That is all.


Did you happen to come across the statement or a fact that this corporation had properties subject

of eminent domain by the City of Manila?

Mr. Cataran. I did not notice any document to that—

Mr. Cuevas. You did not. All right.So, you have no reason to deny that the properties of this corporation were expropriated by the

City of Manila sometime in June 2000?

Representative Umali. Witness is incompetent to answer, Your Honor.


Mr. Cataran. I did not notice any document. I do not know.

Mr. Cuevas. But you are not denying or contradicting that the properties of this corporation had

been expropriated by the City of Manila?




Mr. Cataran. I do not know. I have not seen such document.

Mr. Cuevas. You do not know anything about that?

Mr. Cataran. Yes.

Mr. Cuevas. I have with me a photocopy of a check paid to Cristina Corona, care of BASA

Guidote Enterprises, in the amount of P34,703,800.00. You do not know anything about this?

Representative Umali. If Your Honor please, objection.

May we register our continuing objection, Your Honor?

The Presiding Officer. The witness is only being asked if he knows about that.

Mr. Cataran. I do not know about it.

Mr. Cuevas. May we ask the witness to examine the xeroxed copy of the check?

Hindi niyo alam ‘yan?

Mr. Cataran. No.

Mr. Cuevas. You did not have an inkling about the payment in terms of the check relative to

the expropriation proceedings I mentioned in my cross-examination?

Mr. Cataran. No, I have no knowledge—


Now, did you ascertain whether this payment of the lots belonging to the corporation, subject

matter of your testimony, is true or not?

Mr. Cataran. I do not know. I have not seen—

Mr. Cuevas. So, no investigation was made by you—

Representative Umali. Your Honor—

Mr. Cuevas. Kindly allow me to finish?

And also you have never examined any aspect of this alleged expropriation proceeding of the

property of this corporation against whom you have issued an order of revocation because of failure

to comply with the reportorial requirements?

Mr. Cataran. Yes. I just checked as to the reports. But I have not seen such document.


But my question to you now is, after you were subpoenaed, did you take the pain of going deeper

into the affairs of this corporation because this corporation is dealing in millions and apparently it had

not complied with the reportorial requirement, did your examination or investigation go that far?

Mr. Cataran. No, because we already revoked the Certificate of Registration in 2003.

Mr. Cuevas. That is not my question to you. My question to you is, did you go any deeper—

The Presiding Officer. Just answer the question.




Mr. Cataran. No.

Mr. Cuevas. So you never came to know about these transactions I am referring to?

Mr. Cataran. Yes.

Mr. Cuevas. Now, after you were subpoenaed and you came to know already that you will be

asked to testify in connection with this corporation, you did not bother to go deeper and determine,meron nga bang karapatan itong corporation na ito na magpahiram ng 10 million—11 million,

because apparently that is the gist of your being presented here.

Mr. Cataran. No. I did not—

Mr. Cuevas. Hindi po.

Mr. Cataran. Yes.

Mr. Cuevas. You are totally bankrupt of any knowledge about this transaction?

Mr. Cataran. Well, I read the newspaper but I did not see anything in the records.Mr. Cuevas. No, no. That is not my question again, otherwise I will be compelled to ask the

Honorable Court to direct you to—

My question, you are totally bankrupt of any information relative to the expropriation of the

property of this corporation for which it was paid P34 million something?

Representative Umali. Already asked and answered.

Mr. Cuevas. What is the answer?

Representative Umali. The answer is that he read in the papers, Your Honor.

Mr. Cuevas. I touched that a while ago. We submit, Your Honor.

The Presiding Officer. The tendency of the question is to test the competency of this witness

to testify on the matters involved in this case.

Mr. Cuevas. Because in cross-examination, Your Honor, a witness may be—

The Presiding Officer. Witness may answer.


Mr. Cataran. No.

Mr. Cuevas. That is all with the witness, Your Honor.

The Presiding Officer. Redirect.

Representative Umali. Just a few redirect, Your Honor.

Mr. Cuevas. May we request, Your Honor, that the check we confronted the witness be marked

as Exhibit “44”.

Thank you.

The Presiding Officer. What is the request of the Counsel for the Defense?




Mr. Cuevas. We are merely asking that it be marked, Your Honor, as exhibit for the—

The Presiding Officer. All right. Mark it accordingly.

Representative Umali. If, Your Honor please, what is being presented is just a xeroxed copy

of a check, Your Honor.

Mr. Cuevas. We made a—

The Presiding Officer. You should have objected at the very instance, Your Honor, with respect

to the character of the evidence presented.


Mr. Cuevas. Besides, we only have it identified and marked. We are not yet offering it. For

all you know, we may not offer it at all.

Representative Umali. Provisional marking, Your Honor, perhaps. But that is all that there is,

Your Honor.

The Presiding Officer. The Chair rules that let this xeroxed copy remain as an exhibit for the

Defense for the record.

Representative Umali. If I may proceed, Your Honor?


Representative Umali. Mr. Witness, you made mention earlier on cross-examination when asked

of the primary franchise of BGEI. Can you clarify what do you mean by “primary franchise”?

Mr. Cuevas. Witness is incompetent, Your Honor.

The Presiding Officer. Sustained.

Mr. Cuevas. I did not ask him on his knowledge.

The Presiding Officer. The best evidence is the Articles of Incorporation.

Representative Umali. No, Your Honor. I am asking just to explain what is meant by “primary

franchise.”

The Presiding Officer. What is the relevance of that information to this proceeding?

Representative Umali. I would like to know, Your Honor, what he meant by “this is the primary

purpose,” Your Honor. If that is equivalent to a primary purpose.

The Presiding Officer. All right. Okay. You may answer. Para wala nang maraming

salitaan.

Mr. Cataran. Primary franchise refers to the juridical personality of the corporation. When we

issue the primary franchise, meaning, the Certificate of Registration, it is a juridical person. That is the

primary franchise.

Representative Umali. And what do you mean by a secondary franchise?

Mr. Cataran. It is an authority to operate.




The Presiding Officer. Secondary what?

Representative Umali. Secondary franchise. That is what—

The Presiding Officer. There is no secondary franchise. Primary purpose, secondary purpose.

Representative Umali. Precisely, Your Honor. This is why I want to clarify, Your Honor.

Because this is the question asked by the Defense Counsel. The primary franchise and the secondaryfranchise. So I would like to—

The Presiding Officer. Witness may answer. All right.

Mr. Cataran. Secondary franchise refers to the license to Operate. Let us say, it is a business,

we issue a separate certificate other than Certificate of Registration. That is the secondary franchise.

Representative Umali. The secondary franchise is akin to the primary and secondary purposes.

Is that what you mean, Mr. Witness?

The Presiding Officer. What is the relationship of the franchise that you are talking about with

the purposes of the corporation?

Mr. Cataran. The primary franchise refers to the life of the corporation. But as to secondary

franchise, refers to the right of the corporation to operate. Let us say, we can grant this primary

franchise, meaning, we can incorporate so that a corporation, let us say a school, can have a juridical

personality. Right after registration, the SEC, since there is already a juridical person, before it can

operate as a school, it has to secure a secondary franchise from DepEd. That Is the meaning.

The Presiding Officer. Under what portion of the Corporation Law is that authorized practice?

Is it not that the incorporation gives the corporation the personality? It is a recognition and

authorization for the corporation to exist as a person so that it can contract, it can own property, it can

sue and be sued, it can do anything like an ordinary human being in commercial business. Is it not?

Mr. Cataran. Yes, Your Honor. But with respect to the business, you need a secondary

franchise. For example, if you put up— let us say you register an insurance company with the SEC,

we can approve it. We can grant the Certificate of Registration, meaning it now has the first primary

franchise but it cannot just engage in insurance without securing anything or license or authority from

the Insurance Commission. Just like a bank. You register with the SEC as a bank, you can already

open—no, I think, you have to secure authority from BSP. That is the difference between a primary

and secondary franchise.

The Presiding Officer. But ordinarily, a corporation like the one we are discussing is an ordinary

corporation. Once the Articles of Incorporation are approved and a Certificate of Registration isissued, it can operate its primary purpose, is it not?

Mr. Cataran. Yes, Your Honor, because—

The Presiding Officer. Then, if it wants to operate any of its secondary purposes, then it must

ask permission from the Securities and Exchange Commission. Is it not?

Mr. Cataran. From the SEC, no. But I do not know with respect to other government agency,

they might—

The Presiding Officer. We are talking of this corporation. We are not talking of general—of

other corporations. This corporation involved in this proceeding.




Mr. Cataran. We do not issue secondary franchise for this kind of corporation.

The Presiding Officer. Does it have any secondary purpose?


The Presiding Officer. Has it asked for the use of any of its secondary purposes?

Mr. Cataran. No. We have no record on that.

The Presiding Officer. Precisely. So what are you talking about secondary franchise and primary

franchise?

Mr. Cataran. I already answered the question of the Prosecutor to explain what is the difference

between a primary and secondary franchise.

The Presiding Officer. Qualify your question to your witness.


Your Honor, I think it has been sufficiently explained. We are through with the witness, Your

Honor.

Mr. Cuevas. No re-cross, Your Honor, for the Defense.

Thank you, Atty. Cataran.


Senator Sotto. Mr. President, Senator Lito Lapid wishes to be recognized.

The Presiding Officer. The gentleman from Pampanga is recognized.

Senator Lapid. Oh, ba’t tumatawa na naman kayo d’yan? [ Laughter ].

Thank you po, Mr. Senate President.

Sa Prosekyusyon, may ano lang po ako dito, may katanungan lang po ako. Mr. President,

nakalagay po sa SALN ni Justice Corona na nag-cash advance siya ng P11 million. Ano po ang

diperensya, ang pagkakaiba ng cash advance, loan o utang?

The Presiding Officer. Sino ang tinatanong ninyo?

Senator Lapid. Prosecution po.

The Presiding Officer. Ginoong Testigo, ang tinatanong ng—

Senator Lapid. Hindi po. Hindi po. Wala pong kinalaman dito ang testigo.

The Presiding Officer. Who is being asked to answer?

Senator Lapid. Prosecution po.

The Presiding Officer. Ah, the Prosecution. Please answer.

Representative Umali. With the permission of this Honorable Court.

Iyon nga po ang inaalam namin na cash advance. Hindi po namin maintindihan dahil wala




namang—hindi naman po shareholder si Chief Justice Corona, maging si Cristina Corona. Pero

nagka-cash advance po sila dito, kaya iyon po ang hindi namin maintindihan. At ito po ay

nakalagay kaya po ito’y piniprisinta namin at nililinaw po namin ngayon.

Senator Lapid. Hindi na po siguro mahalaga kung nagsarado iyong kumpanya o hindi.

Nangutang ba?

Representative Umali. Kasi po sa korporasyon dapat po ay mayroong board approval ,

mayroon pong prosesong dinadaanan po ito. Dapat po ay may board resolution. Pero wala pong

lahat ito dahil po ang sabi nga po ng Securities and Exchange Commission, itong lisensiyang ito

ay revoked na. Hindi po nagko-comply ito pamula pa po noong 1991 hanggang sa kasalukuyan.

Senator Lapid. So, ibig niyo pong sabihin, kanina tanong kayo nang tanong at ilang oras

na tayo dito iyan lang ang gusto niyong palabasin, iyong P11 million kung inutang o in-advance

o ni-loan?

Representative Umali. Marami pa po. Iyong P11 million na nag-reflect ho iyan sa SALN

from 2003 hanggang 2009. Tapos po iyong doon po sa dorsal portion nung mga exhibits ng

SALN na ito ay lumalabas po doon na si Cristina Corona ay engaged sa real estate business

pero sa kanya pong—wala naman po siyang—wala naman pong record sa SEC, wala rin pong

record sa BIR, wala pong record sa lahat. Kanya po ito po ay nakapagtataka kung saan

po nanggaling ito. And this is—ito po ang tinatanong po namin, ito po ine-establish namin,

ito po ay unexplained wealth.

Senator Lapid. Iyon lang po. Maraming salamat.

Mr. Cuevas. If that is the purpose—

Representative Umali. Unexplained source.

Mr. Cuevas. With the kind permission of the—

I thought there is a resolution—

Senator Sotto. The Defense wishes to be recognized, Mr. President.

Mr. Cuevas. There is already a resolution of this Court, Your Honor, both verbal and

written, denying the Prosecution from presenting evidence of unexplained wealth, Your Honor,

very clearly.

Senator Sotto. Anyway, Mr. President—

Representative Umali. Nondisclosure po ang isang nais ko pong...

Mr. Cuevas. Tukuyin.

Representative Umali. ...linawin sa bagay na ito, Your Honor.


Senator Sotto. Mr. President, may we—

The Presiding Officer. May I caution everybody to respect the rulings of this Court. We have

already ruled that Paragraph 2.4 is not permissible to receive any proof. So, kindly adhere to the

rules of this Court.




Representative Umali. Sorry po, Your Honor.

The Presiding Officer. So ordered.

Senator Sotto. Mr. President, may we recognize Senator Francis Escudero.

The Presiding Officer. The gentleman from Sorsogon.

Senator Escudero. Thank you, Mr. President.

Ilang katanungan lamang po sa testigo.

Ginoong Testigo, kung ako po at apat o lima kong kaibigan nagdesisyon na mag-negosyo,

bumili ng lupa o magpautang, kailangan ko ho bang magpa-rehistro sa inyo?

Mr. Cataran. Kung gusto niyong magkaroon ng juridical personality—

Senator Escudero. Ibig sabihin po ng juridical personality hindi po ba kapag dinemanda iyong

kumpanya, hindi puwedeng habulin hanggang salawal o brief ko, puwede lamang habulin iyong

in-invest ko, shareholding ko sa kumpanya?

Mr. Cataran. Opo.

Senator Escudero. Tinanong ko po iyon dahil kanina niyo pa po sinasabing hindi na puwede

mag-negosyo o mag-engage sa primary purpose iyong kumpanya.

Liliwanagin ko po. As a corporation, it can no longer do that but as an association or co-

ownership, it can do that?

Mr. Cataran. Of course.

Senator Escudero. Hindi po ba mayroon ding mga SEC Resolution—noon pa ho ‘to, hindi

ko alam kung napalitan na ninyo, noong kami’y nasa eskuwelahan pa—na kapagka ang isangkorporasyon ay hindi na rehistrado sa SEC , ito ay nagiging isang asosasyon na lamang governed

by the rules of co-ownership sa ilalim ng Civil Code?

Mr. Cataran. Opo. Kasi—maliban na lang kung mag-register uli sila as an association. Pero

kung hindi mag-register, ordinary association lang pero walang juridical personality.

Senator Escudero. Ang pinupunto ko nga po iyong binabanggit niyo kaninang bawal silang

mag-negosyo, bawal nila gawin iyong primary purpose, bawal gawin iyong secondary purpose in

connection with being a corporation. But they can still do it as an association governed by the rules

of co-ownership after your order of cancellation. But this time around, wala na ho iyong protection

ng batas na hindi sila puwedeng idemanda in their individual capacity. Ngayon ho puwede na

silang habulin hanggang personal nilang ari-arian?

Mr. Cataran. Opo.

Senator Escudero. Ngayon, kaugnay po nung secondary franchise na nabanggit po ninyo,

iyong secondary franchise hindi po ba ini-issue lamang ‘yan sa mga specific na negosyo na nire-

require ng batas na mabigat ang regulasyon at superbisyon ng SEC?

Mr. Cataran. Opo.

Senator Escudero. Hindi po ‘yan sa lahat ng korporasyon at mga negosyong ordinaryo

naman? Nabanggit niyo po kanina insurance...




Mr. Cataran. Opo.

Senator Escudero. ...siguro banking kailangan din secondary franchise?

Mr. Cataran. Opo.

Senator Escudero. Pero kung ang benta at sangla ng lupa o awto o pagpapa-utang, hindi

na po kailangan ng secondary purpose?

Mr. Cataran. Opo.

Senator Escudero. Secondary franchise, rather.

Mr. Cataran. Opo.

Senator Escudero. In fact, ni hindi po kailangan rehistrado sa inyo kaya nga lang, puwede

ho silang habulin at idemanda sa personal nilang kapasidad ?

Mr. Cataran. Opo.



Senator Sotto. Thank you, Mr. President.

We are ready to discharge the witness.

The Presiding Officer. Any objection? [Silence]

Witness is discharged.

The Floor Leader.

Senator Sotto. Mr. President, the Prosecution.

Representative Tupas. Thank you, Your Honor.

We will call now our second witness. The name is Ms. Nerissa Josef, the Vice President of the

Ayala Land Inc. And may we request, Your Honor, that Atty. Winston Ginez be recognized to conduct

the direct examination.

The Presiding Officer. Let the witness come to the floor of this Court, take the witness stand

and be sworn in. And the named Counsel for the Prosecution,…

Representative Tupas. Atty. Ginez, Your Honor.

The Presiding Officer. …Atty. Ginez will make the direct examination.

Mr. Ginez. Thank you, Your Honor.

The Presiding Officer. Welcome.

The Secretary. Ms. Josef, please raise your right hand? Do you swear to tell the truth, the whole

truth and nothing but the truth in this Impeachment Proceeding?

Ms. Josef. Yes, Ma’am.




The Secretary. So, help you God.

Mr. Ginez. May I first qualify, Your Honor, the witness?


Mr. Ginez. Madam Witness, please state your name and other personal circumstances?

Ms. Josef. My name is Nerissa Josef. I am the Assistant Vice President of Ayala Land, I am

of legal age, I am single and I reside in Marikina.

Mr. Ginez. Thank you, Madam Witness.

Your Honors, the Prosecution is respectfully offering the testimony of the witness for the following

purposes—

The Presiding Officer. Under what Article?

Mr. Ginez. Article II, Your Honor. She will testify under Paragraph 2.3 of the Verified

Complaint.


Mr. Cuevas. With the kind permission of the Honorable Court.

I heard the statement “qualify the witness.” Are we made to believe that the witness is an expert

witness or she is being presented only as an ordinary witness? If she is merely an ordinary witness,

no need to qualify her. That is elementary.

Mr. Ginez. No, Your Honor. The qualification is as to the name and personal circumstances

of the witness.

The Presiding Officer. Only with respect to the personal circumstances. That is a very

technical matter.

Mr. Cuevas. Because there are a lot of people witnessing this—law students, law professors,

Your Honor. And we wanted to put the record clearly and succinctly, Your Honor.

The Presiding Officer. So, let the witness now proceed—

Mr. Cuevas. As an ordinary witness, Your Honor.

The Presiding Officer. As an ordinary witness.



Again, Your Honor, we are offering the testimony of the witness for the following purposes: No.

1, she will produce, identify and testify on the documents she brought pursuant to the Subpoena issued

by this Honorable Court in connection with the purchase of Honorable Chief Justice Renato C. Corona

and Mrs. Cristina R. Corona of Unit 31-B with one parking slot located at The Columns, Ayala Avenue

in Makati City; No. 2, she will testify that in her capacity as the authorized signatory of Community

Innovations Inc., she signed the Contract to Sell, dated January 2004, and Deed of Absolute Sale,

dated October 1, 2004, covering the subject condominium unit, Your Honor.





Mr. Ginez. She will also testify, Your Honor, that Honorable Chief Justice Renato C. Corona

and Mrs. Corona had already paid 95 percent of the purchased price as of December 31, 2003

but the same was not declared in his Statement of Assets and Liabilities as of December 31, 2003,

Your Honor.

She will also testify, Your Honor, that on March, 2004, the Deed of Absolute Sale was executed

between Community Innovations Inc. and Chief Justice Renato C. Corona and Mrs. Corona but again

as of December 31, 2004, 2005, 2006, 2007, 2008 and 2009, this property was not declared in the

Statement of Assets and Liabilities and Net Worth of the Honorable Chief Justice Renato C. Corona.

May I proceed, Your Honor?


Mr. Ginez. Madam Witness, you said that you are presently employed as an Assistant Vice

President of Ayala Land Inc.

Ms. Josef. Yes, Sir.

Mr. Ginez. Since when have you been employed with Ayala Land Inc., Madam Witness?

Ms. Josef. I have been with Ayala Land Inc. since 1992, Sir.

Mr. Ginez. Would it be correct to say then, Madam Witness, that you have been an employee

of Ayala Land Inc. for 20 years, more or less?


Mr. Ginez. Madam Witness, if you could still recall, what was your position at Ayala Land Inc.

in 2004?

Ms. Josef. In 2004, Sir, I was a Project Development Manager.

Mr. Ginez. What were your duties and responsibilities as Project Development Manager of Ayala

Land Inc. in 2004, Madam Witness?

Ms. Josef. As project development manager, I was tasked or I was assigned to manage and

oversee the development of projects that were assigned to me.

At that time in 2004, I was assigned to Community Innovations Inc. In addition, in Community

Innovations Inc., I was also assigned to be an authorized signatory of sales contracts involving

residential units of Community Innovations Inc.


You mentioned a company by the name “Community Innovations Inc.” What is the relation of

Community Innovations Inc. with Ayala Land Inc., if you know, Madam Witness?

Ms. Josef. Community Innovations Inc. is a 100-percent owned company of Ayala Land Inc.

Mr. Ginez. Madam Witness, why did you appear in today’s hearing of the Honorable

Impeachment Court?

Ms. Josef. I am here, Sir, because I received a subpoena from this Honorable Impeachment

Court.




Mr. Ginez. In the subpoena issued by the Honorable Court, Madam Witness, one of the

documents you were required to bring is the original of the Contract to Sell or Deed of Conditional

Sale in connection with a purchase of the condominium unit covered by Condominium Certificate

of Title No. 85716 in the name of Cristina R. Corona, married to Renato C. Corona. Question,

Madam Witness, is: what document did you bring, if any, in connection with the said directive of

the Honorable Court?

Ms. Josef. I brought the original copy of the Contract to Sell dated January 20, 2004, Sir.

Mr. Ginez. May I approach the witness, Your Honor?


Mr. Ginez. We would like to manifest for the record, Your Honor, that the witness handed to

this representation the original of the Contract to Sell dated January 20, 2004 entered into by and

between Community Innovations Inc.; Cristina R. Corona. The project involved, Your Honor, is The

Columns Ayala Avenue; the unit purchased in Paragraph 2, Your Honor, is Unit 31B, one bedroom,

Tower 1, 48 square meters, more or less, with one parking lot. And the purchase price, Your Honor,

is P3,588,931.82.

Madam Witness, there appears a signature on the signing page of this Contract to Sell, particularly,

Madam Witness, seller by Efren L. Tan; Nerissa N. Josef, attorney-in-fact, and Cristina R. Corona,

purchaser. Madam Witness, I direct your attention to the signature above the printed name “Nerissa

N. Josef,” do you know whose signature is that?

Ms. Josef. Yes, Sir. Tha is my signature.

Mr. Ginez. May I manifest, Your Honor, that this Contract to Sell had been previously marked

during the pre-marking as Exhibit “NNN” and its Exhibits “A”, “B” and “C” as Exhibits “NNN-1”,

“NNN-2” and “NNN-3”.

The Presiding Officer. What is the date of that document?

Mr. Ginez. January 20, 2004, Your Honor.


Mr. Ginez. At this point, may I request, Your Honor, Counsel of the Defense to manifest whether

or not the photocopy is a faithful reproduction, Your Honor.

The Presiding Officer. Is that document covered by a notarial registry?

Mr. Ginez. Yes, Your Honor. It is a notarized document, Your Honor.

The Presiding Officer. Yes, proceed.

Mr. Ginez. I am waiting for the stipulation, Your Honor, that it is a faithful reproduction.

Mr. Cuevas. We stipulate or admit, Your Honor, that the documents being identified are faithful

reproduction of their respective original.

Mr. Ginez. Thank you, Justice.

Madam Witness, may I direct you to Annex “C” of this Contract to Sell which was marked

for identification purposes as Exhibit “NNN-3”, entitled “Purchase Price and Manner of Payment,”

Your Honors.




For the record, Madam Witness, can you kindly read for the record how the purchase price of

P3,588,931.82 be paid by the purchaser of this unit?

Ms. Josef . Based on Annex “C,” Sir, there is an attached schedule of payment. The deposit

of P25,000 was paid on January 29, 2003; downpayment of P543,181.82, plus a value-added tax

of P56,818.18 and these were paid on March 28, 2003. And the monthly installment schedule,

the first installment of P1,113,033.18 and the value-added tax of P111,303.32, and both were paidon April 28, 2003.

Second installment of P1,728,270.23 and value-added tax of P172,827.02 were paid on

October 10, 2003.

The final installment of P179,446.59 and the value-added tax of P17,944.66 would have

been paid upon advice.


The Presiding Officer. How many installments are those—is that monthly, semi-annually

or annually?

Ms. Josef . It was varied, sir. The first installment was on April 28, 2003; the second installment

was paid on October 10, 2003, Your Honor; and the final payment of the third installment was paid

upon advice which based on our official receipts were paid—if I may refer to the official receipt—

The Presiding Officer. The installments are covered in one year?

Ms. Josef . Yes, Sir.


Mr. Ginez. May I proceed, Your Honor?


Mr. Ginez. Madam Witness, you had so far testified that according to you the deposit,

the downpayment, first, second installments were paid all in one year. And you also said that the

third installment, payable upon advice was also paid according to you. What proof, if any, Madam

Witness, do you have that all these installment payments were indeed paid by Mrs. Corona?

Ms. Josef . I have with me, sir, the original duplicate copy of the Official Receipts.

Mr. Ginez. May I approach again the witness, Your Honor?


Mr. Ginez. We would like to manifest, Your Honor, that the witness handed to this representation

various receipts, Your Honor, which were previously marked during the pre-marking conducted

by the Honorable Deputy Clerk of Court as Exhibits “OOO” to “OOO-5”, inclusive, Your Honor.

And I am referring, Your Honor, to Official Receipt No. 2093, dated January 29, 2003, in payment

of the P25,000 issued to Corona, Cristina R.

The Presiding Officer. Who was the issuing entity?

Mr. Ginez. Community Innovations Inc., Your Honor.





Mr. Ginez. Official Receipt No. 2813 which was previously marked as Exhibit “OOO-1”,

dated March 28, 2003, issued to Renato Corona in the amount of P600,000, representing the deposit,

Your Honor.

Witness also handed to this representation, Your Honor, Official Receipt No. 3109, previously

marked as Exhibit “OOO-2”, dated April 28, 2003, issued to Corona, Cristina/Renato, in the amount

of P1,224,336.50, Your Honor.

Official Receipt No. 5197, previously marked as Exhibit “OOO-3”, dated October 20, 2003,

issued to Cristina Corona in the total amount of P1,901,096.75. And Official Receipt No. 5198

previously marked as Exhibit “OOO-4” issued to Cristina Corona in the amount of P0.50,

Your Honor.

And lastly, Exhibit “OOO-5” referring to Official Receipt No. 7621 dated March 8, 2004

representing the full payment of the said condominium unit and one parking slot issued to Cristina

Corona in the amount of P290,922.37, Your Honor, which includes, if I manifest to the record, the

registration fee in the amount of P17,721.46; Documentary Stamp Tax in the amount of P53,835.00;

Transfer Tax in the amount of P17,974.66 as well as Service Fee and issuance of title in the

amount of P4,000.

As I have previously said, Your Honor, the photocopies of these were previously marked. And

may I now request Defense Counsel, Your Honor, to compare that the photocopies are faithful

reproduction of the original.

[Counsels Examining the Document ]

Mr. Cuevas. If the purpose is substitution, Your Honor, we have no objection, Your Honor.



Mr. Ginez. Madam Witness, you have so far again testified that Honorable Chief Justice

Renato Corona and Mrs. Cristina Corona had fully paid the subject condominium unit as of March

of 2004. What happened next, Madam Witness, after they had made the full payment?

Mr. Cuevas. At this point, Your Honor, we will object to the basis of the question. There is

nothing in any of these documents that the “Renato Corona” being referred to is Chief Justice Corona.

What the document merely says is “Renato.”

Mr. Ginez. We will reform, Your Honor. I am just making a very respectful—to Honorable

Chief Justice, the respondent in this case, Your Honor.

Mr. Cuevas. But we are dealing with the documents that is why I said there is no basis,

Your Honor.

The Presiding Officer. Well, just let the document speak for itself.


What happened next, Madam Witness, after Renato Corona and Cristina Corona had made full

payment of the purchase price?

Mr. Cuevas. Question, too general, Your Honor, “What happened?” They may have celebrated

their 50th anniversary or what. [ Laughter] That was too broad.




The Presiding Officer. Let us consider that as a preliminary question.

You may answer. The witness may answer.


Ms. Josef. After full payment, Sir, we executed the Deed of Absolute Sale.

Mr. Ginez. Madam Witness, one of the documents you were asked to bring to this Honorable

Court is the Deed of Absolute Sale. What document did you bring, if any, in connection with that

directive, Madam Witness?

Ms. Josef. Sir, I brought with me an original copy of the Deed of Absolute Sale dated October

1, 2004.

Mr. Ginez. Your Honor, we would like to manifest that the witness handed to this representation

the Deed of Absolute Sale dated October 1, 2004 between Community Innovations Inc. and Cristina

R. Corona married to Renato C. Corona with three annexes, Your Honor, Annex “A”, “B”, and “C”,

which for identification purposes had been previously marked as Exhibit “PPP”, “PPP-1”, “PPP-2”,

“PPP-3”, respectively.

Again, Madam Witness, I would like to direct your attention on Page 2 of this Deed of Absolute

Sale seller. And on the signatures, there appears a signature of the printed name “Nerissa N. Josef,

Attorney-in-Fact.” Do you know whose signature is this, Madam Witness?

The Presiding Officer. Just a minute. What is the date of that Deed of Sale?

Mr. Ginez. Your Honor, the date is October 1, 2004.


Mr. Ginez. I have a pending question, Your Honor.

The Presiding Officer. Yes, go ahead.

Ms. Josef. Yes.

The Presiding Officer. Answer the question.

Ms. Josef. Yes, that is my signature, Sir.

Mr. Ginez. There is also a signature above the printed name “Grace Evangeline E.—F.

Manankil-Sta. Ana.” Do you know whose signature is this, Madam Witness?

Ms. Josef. Yes, Sir. That is the signature of Grace Evangeline F. Manankil-Sta Ana.

Mr. Ginez. Why do you know that that is her signature?

Ms. Josef. I am familiar with her signature, Sir. I have been working with her in Community

Innovations for five (5) years.


May I request, Your Honor, the Defense Counsel to manifest that the photocopy of the Deed of

Absolute Sale is a faithful reproduction of the original, Your Honor.

[Counsels Examining the Document ]




May I request, Your Honor, the Defense Counsel to manifest if it is a faithful reproduction?

Mr. Cuevas. It is, Your Honor.



Mr. Ginez. Madam Witness, based on the documents that you brought with you in accordance

with the subpoena issued by this Honorable Court, do you know when was subject condominium unit

turned over to the purchaser, Cristina R. Corona, married to Renato C. Corona?

Ms. Josef. Based on our record, Sir, it was deemed accepted on June 7, 2008.

Mr. Ginez. Madam Witness, may we be given that copy of the letter, Madam Witness?

We manifest for the record, Your Honor, that the witness handed to this representation a letter

under the heading “Community Innovations” dated June 11, 2008, addressed to Cristina Corona,

which says, Your Honor, and I would like to quote, on the last paragraph:

However, we seek your understanding that this should not tender you from accepting your unit. As

stated in our previous letter to you, the computation of real property tax will be based upon the date

of your acceptance of your unit which should be on or before June 7, 2008. Should you fail to

personally accept or send a representative to accept the unit, we will nevertheless deem the unit

accepted and delivered on June 7, 2008.

This has not been pre-marked, Your Honor, so may I request that the photocopy thereof, which

I will request the Defense to compare, Your Honor, will later on be marked as our Exhibit “PPP-4”,

Your Honor. May I request that the photocopy of the said document be compared with the original?

[Counsels Examining the Document

]May we request for the stipulation, Your Honor, that the photocopy is a faithful reproduction of

the original?

The Presiding Officer. Defense may stipulate, if they want.

Mr. Cuevas. We have no objection, Your Honor.


We request again that it be marked as our “PPP-4”, Your Honor.

One of the documents that you were—

Mr. Cuevas. Wait, wait, wait. We are checking the document.

May we request, if Your Honor please, that this Exhibit “PPP-4” of the Prosecution be marked

as Exhibit “45”, Your Honor, for the Defense.

The Presiding Officer. Mark it accordingly.

Mr. Ginez. I will be on my last part, Your Honor.

One of the documents that were also pre-marked, Madam Witness, is a Buyer Information Sheet.

Did you bring the original copy of the said document, Madam Witness?





Mr. Ginez. We manifest, Your Honor, that the witness handed to this representation a Buyer

Information Sheet, Your Honor, which is on an extended long bond paper, Your Honor.

The Presiding Officer. What is the date of that document?

Mr. Ginez. It seems that there is no date, Your Honor, but I would like to read for the record:The project name is “The Columns.” The principal buyer is “Corona Renato Coronado” and

the spouse, Your Honor, is “Corona, Cristina Roco.” The employment information, Your Honor,

of the principal buyer, “Associate Justice, Supreme Court of the Philippines, Padre Faura, Manila,”

and there appear signatures above or beside the name “Renato C. Corona” and above the printed

name “Cristina R. Corona.” The photocopy of this document has been pre-marked, Your Honor,

as our Exhibit “MMM”.

May I request the Defense, Your Honor, to compare that the photocopy is a faithful reproduction

of the original?

Mr. Cuevas. No objection, Your Honor, to the proposed substitution. We admit that thexeroxed copies are faithful reproduction of the respective originals, Your Honor.


The Presiding Officer. Proceed, Counsel.

Mr. Ginez. We have no other direct examination questions, Your Honor.

The Presiding Officer. You want to discharge–Is there any cross-examination?

Mr. Cuevas. May we request, Your Honor, that we be allowed to conduct the cross-examination

tomorrow?The Presiding Officer. Motion granted.

Next witness, Mr. Prosecution Panel.

The witness is discharged.

Mr. Cuevas. If Your Honor please.

The Presiding Officer. What is the pleasure of the Defense Counsel?

Mr. Cuevas. May we request that Atty. Esguerra be recognized for the Defense, Your Honor.

The Presiding Officer. So cross?

Mr. Cuevas. No, Your Honor. Only a short manifestation.

The Presiding Officer. Atty. Esguerra…

Atty. Esguerra. One sentence, Your Honor.

The Presiding Officer. …is recognized.

Mr. Esguerra. There is an accompanying note and we would request the witness that this

handwritten note dated 7 June 2008…




The Presiding Officer. 2000–

Mr. Esguerra. ‘08, Your Honor.

The Presiding Officer. ‘08.

Mr. Esguerra. Covering—It is a cover note in connection with the 11 June 2008 letter of

Community Innovations to Mrs. Cristina Corona. I would request, Your Honor, that this be preserved,this particular handwritten note of Mrs. Tina Corona. And in the meantime as provisional marking—

The Presiding Officer. Are you going to preserve that as an exhibit?

Mr. Esguerra. Yes, Your Honor, just provisional, for purposes of the cross-examination

tomorrow.


Mr. Esguerra. Because we do not want this to be tampered with, Your Honor.

May we request that this exhibit be marked as our—this document, a handwritten note, “7 June

2008 with the letterhead ‘Community Innovations,’ signed by one “Mrs. Tina Corona” be marked as

our, provisionally, Exhibit “46”, Your Honor.

The Presiding Officer. The Presiding Officer directs that that note be initialed by both the

Prosecution Counsel and the Defense Counsel so that there will be no tampering.

Mr. Ginez. Your Honor, I will go further than that, Your Honor. I would request the witness

if she could submit that original, Your Honor, to the Secretariat, Your Honor. If the witness will be

allowed, Your Honor.

The Presiding Officer. Better still, have it initialed by both sides.


Representative Tupas. Okay. Can I discharge now the witness, Mr. President, Your Honor?

Senator Sotto. If there is no—

Mr. Esguerra. We will conduct further cross-examinations tomorrow, Your Honor.

The Presiding Officer. Is there any further question on the witness?

Representative Tupas. No, Your Honor.

The Presiding Officer. So there being none, the witness is discharged.

Representative Tupas. May we call now on our next witness, Your Honor.


Representative Tupas. Thank you.

Our third witness for the day is Mr. Greg Gregorio.

The Presiding Officer. Before we tackle the second witness, may I propose to both sides that

in the case of this documentary evidence, pre-mark them together so that we will not waste time in the

process of the proceeding in marking and stipulating about these documents. If that is possible and if

you agree.




Mr. Ginez. Yes, Your Honor. In fact it was our request to the Defense Counsels, Your Honor,

that during the pre-marking we already made a comparison that the photocopies are faithful

reproduction. But all along and time and again, Your Honor, they said that they will make their

stipulation in the floor, Your Honor. So that is why we are constrained to make the comparison when

we are presenting the witness. But if the Court will direct the Defense Counsels now to make this

comparison and manifestation during the marking, we will be able---we welcome that, Your Honor.

The Presiding Officer. What is the pleasure of the Defense?

Mr. Esguerra. That is not completely true, Your Honor. Insofar as the birth certificates of the

children of the Coronas, we stipulated on that to the extent that there is actually no basis for us not

to stipulate. We agreed with them, Your Honor. So that is not entirely true. I am so sorry to disagree

with the good Counsel from the Prosecution.

Your Honor, may I clarify something insofar as the witness who just testified?


Mr. Esguerra. Your Honor, we just provisionally marked a memorandum, handwritten one,which we caused to be marked as our Exhibit “46”. But we are not done with the cross-examination

of that witness, Your Honor. So that witness must come back tomorrow for our cross-examination,

Your Honor.

The Presiding Officer. So the Prosecution is hereby ordered to produce the witness that was

earlier discharged by this Court to come back tomorrow for cross-examination.

Mr. Ginez. Yes, Your Honor.


Mr. Esguerra. Your Honor, I am so sorry. My understanding is we temporarily dischargedthe witness…


Mr. Esguerra. … for further cross-examination tomorrow hoping that there will be no other

witness. If there is going to be another witness, we might as well call this witness and we finish the

cross-examination.

Representative Tupas. Okay with us.

That is fine with us, Your Honor.

Mr. Esguerra. Precisely. So, if she is still here, may we call her back to the stand, Your Honor?

The Presiding Officer. Who is being called to the stand?

Senator Sotto. Mr. President, may we call back the previous witness?

The Presiding Officer. All right. The previous witness is being recalled to the witness stand.

For what purpose?

Senator Sotto. For the cross-examination, Mr. President, of the Defense.

The Presiding Officer. All right, proceed.




Mr. Esguerra. With the permission of the Honorable Presiding Officer and the Honorable

Members of the Impeachment Court.

I did not get your name correctly, Madam Witness. What is your name again?

Ms. Josef. My name is Nerissa Josef.

Mr. Esguerra. Nerissa Josef.


Mr. Esguerra. And did I hear you right that you are still single?


Mr. Esguerra. Ms. Josef, the transaction, according to you, based on the Contract to Sell and

even the Deed of Absolute Sale which have been marked already as exhibits for the Prosecution, took

place sometime in 2004?

Ms. Josef. Yes, Sir, that is correct.

Mr. Esguerra. Which came first? The Contract to Sell was executed first, of course.

Ms. Josef. Yes, Sir. It was executed on January 20, 2004, Sir.

Mr. Esguerra. And the Deed of Sale was executed when?

Ms. Josef. It was executed on October 1, 2004, Sir.

Mr. Esguerra. All right. When did you pay the—was there a Capital Gains Tax ever paid by

Community Innovations here for purposes of the transfer being the seller?

Ms. Josef. We paid our creditable withholding tax.

Mr. Esguerra. Not any Capital Gains Tax on that transaction?


Mr. Esguerra. Your Honor.

The Presiding Officer. My understanding is that this selling corporation is engaged in real estate

business, and so these are ordinary assets not subject to Capital Gains Tax.

Mr. Esguerra. We understand that, Your Honor. But the good Commissioner, Commissioner

Henares, identified the Certificate of Authorization to Register. And I would like to find out from the

witness whether or not they paid the taxes—I mean, if they paid taxes, if any.

The Presiding Officer. Yes. Well, the witness may answer.

Ms. Josef. Based on our records, Sir, we did pay—we do have a Certificate Authorizing

Registration, plus we also have—which indicates that we have paid our taxes, Sir, in order to

transfer the title.

Mr. Esguerra. Do you have a copy of that with you, Madam Witness?

Ms. Josef.Yes I have, Sir.




The Presiding Officer. Are you given an authority to register this kind of property by the Bureau

of Internal Revenue? I am directing this question to the Witness because only capital assets in real

estate nature are covered by that requirement under the Internal Revenue Code. Because ordinary

assets, real estate subdivision properties are stock in trade in ordinary course of business and they are

not capital assets. They are ordinary assets subject to—not subject to Capital Gains but ordinary

Income Tax.

Ms.Josef. Yes, Your Honor, that is correct. I am not aware that if—that we have paid Capital

Gains Tax on this property. You are correct, Sir, we have paid ordinary Income Taxes.

The Presiding Officer. Well, anyway, that is beside the point. I cannot understand. I am just

trying to clarify this because the only real estate transaction that requires a Capital Gains Tax are capital

real estate in the nature of capital assets, not ordinary assets of an operating company, especially a

corporation that engages in buying and selling real property.

Proceed.

Mr. Esguerra. Thank you, Your Honor.

Do you have that Certificate Authorizing Registration with you? May I borrow it momentarily?

Ms. Josef, I have here with me a photocopy of the same document previously marked for the

Prosecution as Exhibit “LLL”. May I show this to you and just confirm for the record that this is a

copy of that particular document, the duplicate original of which you have shown to the Court?

Ms. Josef. Yes, Sir, it appears to be the same.

Mr. Esguerra. Thank you.

Ms. Josef. A faithful reproduction, Sir.

Mr. Esguerra. May we request, Your Honor, that the photocopy, said to be a faithful

reproduction of the duplicate original copy testified on by the witness, be marked as our Exhibit “47”,

Your Honor.


Mr. Esguerra. May I proceed, Your Honor, so as to save time.


Mr. Esguerra. Ms. Josef, you have the duplicate original with you?


Mr. Esguerra. Is there any indication there about the assessed value of the property covered

by this particular document?

Ms. Josef. There is a selling price here, Sir. Under that, it is P3,588,931.82, Sir.

Mr. Esguerra. How about an entry concerning assessed value?

Voice. [Off-mike] Wala, wala, wala ng assessed value; market value meron.

Ms. Josef. Sir, there is a market zonal value. Is that what you were—it says here P2,880,000,

Sir, for the Unit 31B; and for the parking, there is a P250,000, Sir.




Mr. Esguerra. So that value you just read is smaller?


Mr. Esguerra. [Off-mike] Can I borrow the document, please?

Earlier, you identified a letter and I heard the word or phrase “deemed accepted.” What is that

letter you are referring to, an exhibit that was marked by the Prosecution?

Ms. Josef. It was a letter, Sir, that we sent on June 11, 2008 to our buyer, Ms. Cristina Corona.

Mr. Esguerra. And there is a covering note which I saw and caused to be provisionally marked

as our Exhibit “45”-Defense. Can you please state for the record what that—”46,” I am sorry—what

that note is all about?

Ms. Josef. It is a note, Sir, if I may read, dated June 7, 2008. It says:

Dear Carmina,

This is Mrs. Corona, I have been following up with your office, with Sharlyn Pangilinanand Edge Fajardo about the originals of our Tax Declaration and our RPT receipt for 2008,

pro-rated, so I can settle my payables and accept my unit, Columns Tower I, Unit 31B.

Please give me an update, ASAP.

Thank you.

Mrs. Tina Corona

Mr. Esguerra. We will request that the marking, Your Honor, be retained as our permanent

marking at this particular exhibit.

The Presiding Officer. Mark it.

Mr. Esguerra. Ms. Josef, who is Carmina being addressed here by Mrs. Tina Corona?

Ms. Josef. Sir, she is our Client Relations Manager at that time.

Mr. Esguerra. Is she still connected with Community Innovations?

Ms. Josef. Yes, Sir, she is still connected with Community Innovations.

Mr. Esguerra. When the reference is made to “pro-rated for 2008,” would you know what this

means?

Ms. Josef. Sir, the RPT is usually pro-rated based on the time that the unit is turned over to ourbuyer. For example, if it is turned over at the middle of the year, the pro-rated amount would be half

the amount that was paid for the entire year.

Mr. Esguerra. And that would mean that even if according to you the documents, the Contract

to Sell and the Deed of Absolute Sale were executed in 2004, the acceptance of this unit, on the basis

of the documents you have marked as Exhibit “PPP-4”, and this particular note took place sometime

in 2008.

Ms. Josef. Yes, Sir, it is 2008, Sir.

Mr. Esguerra. Were there issues about the unit, if you know, Ms. Josef?




Ms. Josef. Based on our records, we have a series of letters, actually, leading to this letter, and

there was previous communication with the buyer, Sir.

Mr. Esguerra. So there were issues on the basis of the letters you are holding now concerning

this unit?

Ms. Josef. Yes, Sir, there were some communications.

Mr. Esguerra. You have the letters with you?


Mr. Esguerra. May we see those letters please?

The Presiding Officer. While Counsel is examining the letters, let us recess the trial for

one minute.

The Trial was suspended at 5:31 p.m.

At 5:35 p.m., the trial was resumed.

The Presiding Officer. Trial resumed.

Proceed, Counsel.

Mr. Esguerra. With the permission of the Honorable Court once more.


Mr. Esguerra. Ms. Josef, you have given to me again another letter dated 4 June 2008 addressed

to one Cristina Corona, signed purportedly by one Carmina A. Cruz. You have also handed to me

two (2)—what appears to me to be two (2) copies of one (1) letter dated 26 February 2008 addressed

to one Cristina Corona, consisting of two (2) pages, again, appearing to me to have been signed byone Carmina A. Cruz on the second page. Actually, there are two (2) copies also of that same letter

I referred to of—dated 4 June 2008.

Now I note, Ms. Josef, that in this letter of 4 June 2008, there is mention in the second paragraph—

I will hand this letter to you, “We shall already deem and consider the unit as having been delivered

and accepted as of June 2008.” Can you go over this and confirm if I read that particular entry in

that letter correctly?

Ms. Josef. Yes, Sir. It says here, “However, acceptance of the said unit should be on or before

June 7, 2008. Should the unit still not be accepted by then, we shall already deem and consider the

unit as having been delivered and accepted as of June 7, 2008.”


This other letter of 26 February 2008 also mentions—and if I may read and please confirm if I am

reading it right, “The unit has been deemed delivered and accepted as of February 28, 2008.” I am

showing this letter again to you which you have produced. And read the first paragraph thereof, insofar

as that particular portion that I have read for the record.

Ms. Josef. Yes, Sir. “As we have written in our notice last October 17, 2006, please—Attached

copy—regarding the final reinspection of your unit, we would like to inform you that the unit has been

deemed delivered and accepted as of February 28, 2008. This is pursuant to Section 7 of the Contract

to Sell, which reads—” Shall I read the rest, Sir?




Mr. Esguerra. On the basis of that letter, there was a pre-inspection made, am I right?

Ms. Josef. Yes, there is a mention of a final reinspection of the unit, Sir.

Mr. Esguerra. Final reinspection.


Mr. Esguerra. May we have this second—I mean, only one of the two letters, that last one that

from where you read, that particular portion be marked as our Exhibit “48” consisting of two (2) pages,

if Your Honors please.

Can you state for the record then just to clarify this matter so I can leave this point, Ms. Josef, when

was the actual acceptance by Mrs. Corona of the unit in question?

Ms. Josef. We have no record, Sir, of Mrs. Corona signing an acceptance form, Sir.

Mr. Esguerra. What will be the significance if any of that statement of yours that you have no

record of Mrs. Corona accepting the unit?

Ms. Josef. Based on our records, we have only on record that it has been deemed accepted

based on the provisions of our Contract to Sell.

Mr. Esguerra. So, you want us to understand, and this Court to understand, that there was no

actual acceptance, except that “deemed acceptance” that you were referring to.

Ms. Josef. Based on our record, Sir, yes.

Mr. Esguerra. There is a—can you confirm—I have here a letter of 6 April 2011 addressed to

the board of directors, The Columns Ayala Avenue Condominium Corporation, it is handwritten. I just

have a machined copy, the original must be with you, if you have it, please confirm. May I show this

to you and ask you whether or not you have seen this letter before?

The letter is being shown to the witness.

Ms. Josef. No, Sir, I have not seen this before.

Mr. Esguerra. Would you know, if after the “deemed acceptance” of the unit by Mrs. Corona,

Mrs. Corona or a representative of hers, for that matter, paid the association dues?

Ms. Josef. Sir, the dues are paid to the condominium corporation which is not part of the

developer’s responsibility already. So we have no records of the payments of Ms. Corona to the

condominium corporation.

Mr. Esguerra. Ordinarily, Ms. Josef, is it not that a developer, insofar as the unsold units areconcerned, actually subsidize the dues for these unsold units?

Ms. Josef. For unsold units, Sir, since the owner will be—if it is still in the name of Community

Innovations, then Community Innovations pays its condominium corporation dues like any other

member of the condominium corporation.

Mr. Esguerra. Would that mean, but correct me if I am wrong, would that mean that the

Community Innovations Inc. will be a member of The Columns Ayala Avenue Condominium

Corporation, the association?

Ms. Josef. Sir, if there had been units at that time, yes, Sir.




Mr. Esguerra. And who would be in the best position—

The Presiding Officer. Just a minute. “If there were units at that time,” what do you mean by

that? Units unsold and unaccepted?

Ms. Josef. Once the unit has been transferred, Sir, to the buyer, then the buyer is now the owner

of the unit.The Presiding Officer. Those units not yet sold and not yet accepted actually by the buyer are

still subject to the responsibility of the condominium developer with the association.

Ms. Josef. Sir, our reckoning point is the transfer of the ownership of the condominium. So once

the condominium is already transferred in the name of the buyer, then the buyer becomes an automatic

member of the condominium corporation.


Mr. Esguerra. Thank you, Your Honor.

Ms. Josef, was there delivery based on the record you brought here to this Court, is there anyrecord of the delivery to the buyer of the unit, in this case, Ms. Corona, of a copy of the Tax

Declaration of the unit involved?

Ms. Josef. We have a copy of the Tax Declaration in the name of Ms. Corona, Sir.

Mr. Esguerra. When was this copy of the Tax Declaration delivered based on your records?

Witness, for the record, is examining two letters.

Ms. Josef. Sir, there is a date here of 6-29-2007, Sir.

Mr. Esguerra. 2000?

Ms. Josef. 2007, Sir.

Mr. Esguerra. Okay. Thank you.

Mr. Ginez. May we request, Your Honor, that the said Tax Declaration produced by the witness

be marked, Your Honor, as “For Prosecution’s Exhibit PPP-5".


Mr. Esguerra. Is there a covering letter, Ms. Josef? Is there a covering letter of that Tax

Declaration?

Ms. Josef. We have a copy of the Tax Declaration, Sir.

Mr. Esguerra. Was there a covering letter delivering that—

Ms. Josef. Ah, during the delivery, Sir?

Mr. Esguerra. No. A covering letter of that Tax Declaration addressed to Ms. Corona?

The Presiding Officer. Kindly answer the question whether there is or there is none.

Ms. Josef. We have a covering letter, Sir. It is dated June 11, 2008 where we said that—where

we had enclosed a copy of the Tax Declaration which is in the name of the buyer.




Mr. Esguerra. We manifest, Your Honor, that that letter referred to by the witness has been

previously marked as our exhibit “PPP-4”, Your Honor.

The Presiding Officer. Let it be recorded as manifested.

Mr. Esguerra. The tax declaration also, Your Honor, we would like to be marked as our

Exhibit “48”, Your Honor.


Mr. Esguerra. “49”, I am sorry. It is “49”, Your Honor.

The Presiding Officer. Mark it accordingly as corrected.

Mr. Esguerra. Ms. Josef, if you know, when were the keys to the unit actually given to Ms.

Corona, the buyer?

Ms. Josef. I do not know, Sir.

Mr. Esguerra. You do not know.

And because you do not know, is it safe for me to say, correct me if I am wrong, that there was

actually—there was no actual turnover of the unit?

Ms. Josef. Based on our records, we have no record, Sir, of physical turnover of the unit.


And you do not also know when the keys to the unit were delivered by Community Innovations

to Ms. Corona?

Ms. Josef. I would not know, Sir.

Mr. Esguerra. Are you aware of any complaint or complaints brought to the attention of

Community Innovations Inc. by the buyer, Ms. Corona?

Ms. Josef. I am not personally aware, Sir, but based on the letters there appears to be some

communications regarding that.

Mr. Esguerra. What would those communications indicate? And you can refer to your

documents.

Ms. Josef. Sir, in the letter dated February 26, there is an indication of a final reinspection, which

I would think would mean that there was a previous inspection and there was an inspection again so—

Mr. Esguerra. Why would there be—Tell me, if you know, why would there be an inspection,a reinspection and a final reinspection?

Ms. Josef. I am not really aware of what happened in this unit but normally, during the first

inspection we would have a punch list and if there were any rectifications or changes made, then we

will invite the buyer for a reinspection if those changes have, indeed, been made.

Mr. Esguerra. When you talk of rectification, that means that there was something wrong with

the unit? Would that be a safe conclusion, Ms. Josef?

Ms. Josef. It depends, Sir, on the circumstances of the buyer. I am not familiar with the situation

of the buyer, Sir.




Mr. Esguerra. And you were not able to confirm, therefore, what those problems with the unit

that you have alluded to on the basis of your testimony now?

Ms. Josef. Yes, Sir, I am not aware of what changes were made.

Mr. Esguerra. Now—

The Presiding Officer. May I request the Witness to please fix your microphone so that yourwords are clearer?

Mr. Esguerra. So you would not be aware that there was an inspection where the unit was found

to be made or used as a storage room by Community Innovations?

Ms. Josef. I am not aware, Sir.

Mr. Esguerra. You will not be also aware that at the time of that inspection the unit was full

of debris from other units?


Mr. Esguerra. You will not also be aware that the electric wirings were undersized and not fit

for the use of the unit?


Mr. Esguerra. You will not also be aware that the roofs were leaking and the floors were

damaged?


Mr. Esguerra. You would not also be aware that the windows were unfinished?

Ms. Josef. I would not be aware, Sir.

Mr. Esguerra. Would that mean—just so I can conclude this examination, Ms. Josef, would that

mean that you have never examined the unit itself?

Ms. Josef . No, Sir, I have not been to the unit.

Mr. Esguerra. I think that will be all for the witness, Your Honor.

Mr. Ginez. I have a redirect, Your Honor, if I may be allowed.



Madam Witness, you were shown a copy or in fact you were asked to produce the Certificate

Authorizing Registration involving the sale of this particular condominium unit. And this Certificate

Authorizing Registration states and I would like to quote, “The taxes due thereon have been paid as

indicated below and accordingly the Register of Deeds and other concerned officers may effect transfer

of the properties.”

Madam Witness, my question to you is, based on the records that you have and that you brought

before the Honorable Court, do you know whether or not title of this condominium unit was already

transferred to Cristina R. Corona married to Renato C. Corona?




The Presiding Officer. Do you not think the title would be the best evidence on that?

Mr. Ginez. Yes, Your Honor. We would like to manifest, Your Honor—

The Presiding Officer. All right, the witness may answer if she knows.

Ms. Josef . Yes, Sir, the title was transferred in the name of the buyer.

Mr. Ginez. I would like to show to you, Madam Witness, Condominium Certificate of Title No.

85716 for Unit No. 31-B, one (1) Bedroom Type with the area of 48 square meters located on the

31st Floor with parking lot, Columns, Ayala Avenue, issued in the name of Cristina R. Corona married

to Renato C. Corona, both of legal age, Filipinos.

Can you kindly go over the same and tell us if this was the title that was issued to the purchaser

of this particular unit, Madam Witness?

Mr. Cuevas. Improper for redirect, Your Honor. We have never touched on this title in our

cross-examination.

The Presiding Officer. Sustained.

Mr. Ginez. Well, may I ask for a reconsideration, Your Honor? The Certificate Authorizing

Registration was touched on redirect, Your Honor, and I had premised my question on the issuance

of the title based on the CAR that was shown to the witness because the title will be issued, Your

Honor, as a subsequent result of the issuance of the CAR, Your Honor.

Mr. Cuevas. That is your conclusion.

Mr. Ginez. That is the provision of the law, Your Honor, and there was a directive under the

CAR, Your Honor, that the Register of Deeds may effect the transfer. So my question, that was not

objected to a while ago, Your Honor, is whether the title was issued pursuant thereto, Your Honor.Mr. Cuevas. No, Your Honor.

The Presiding Officer. That is why the Chair ruled that let the title speak for itself because there

is no showing that the registered—the purported registered owner participated in the act of registration.

Mr. Ginez. We submit, Your Honor.

The Presiding Officer. The objection is sustained.

Mr. Ginez. We would like then just to manifest for the record, Your Honor, as the Condominium

Certificate of Title has been previously marked as Exhibit “JJJ” and this was brought to this Honorable

Court and authenticated by the Register of Deeds of Makati City and this was issued, Your Honor,in the City of Makati on November 3, 2004, Your Honor.

The Presiding Officer. Are you making a tender—

Mr. Cuevas. Your Honor please—

The Presiding Officer. I do not think this is the time to do that but anyway, let the manifestation stay.

There is no showing that the named buyer in the title participated in the issuance of the CAR and

in the actual registration of the unit. There is a dispute with respect to the unit and we do not know

what it is so far.




Mr. Ginez. Yes, Your Honor. May we proceed, Your Honor?

The Presiding Officer. Yes. Proceed.

Mr. Ginez. Madam Witness, during cross-examination you were also asked extensively on the

issue of whether or not the title was accepted by the purchaser and you said that it was “deemed

accepted” in June of 2008. And you mentioned about it is based on provisions of the contract.Ms. Josef . Yes, Sir.

Mr. Ginez. Can you tell us what contract you are referring to, Madam Witness, is it the Deed

of Absolute Sale or the Deed of Contract to Sell, Madam Witness?

Mr. Cuevas. Your Honor please, we are compelled to object, Your Honor, because decidedly

this has no basis. What the letters that were produced, Your Honor, show is that there was a

complaint, there was a refusal on the part of the buyer to accept delivery. And the delivery they are

speaking of is constructive delivery. All the while we have been referring to actual turnover—

possession of the property, Your Honor, material possession.

Mr. Ginez. May I be allowed to make a rebuttal, Your Honor.


Mr. Ginez. The Witness said, Your Honor, during her cross- examination that the provisions

of the contract will justify why Community Innovations, Your Honor, decided that Mrs. Corona had

deemed accepted the unit, Your Honor. She said “provisions of the contract,” and my memory is still

fresh, Your Honor. So I am now on re-direct asking her, Your Honor, what provisions of the contract

will be the basis for this deemed acceptance or, as Justice said, Your Honor, constructive acceptance,

Your Honor.

Mr. Cuevas. The same objection, Your Honor. And we do not want to burden this HonorableCourt by a repetition of our objection, Your Honor.

The Presiding Officer. I think the objection is proper. There is no showing that in any way

there is an implied acceptance by the buyer with respect to the issuance of the CAR, the issuance of

the title and everything is just the act and supposition of the selling parties. So I have to sustain the

objection.

Mr. Ginez. We submit, Your Honor, and we have no further re-direct, Your Honor.


Mr. Cuevas. No re-cross, Your Honor.


The Presiding Officer. Let us dispose the witness first.

Senator Sotto. Yes. We were about to—but there are two Members of the Court who wish

to pose questions to the panels and also to the witness. So may we recognize Senator Francis

Escudero and Senator Franklin Drilon, in that order, Mr. President. And then Senator Francis

Pangilinan and Senator Pimentel.

The Presiding Officer. Senator Escudero has the floor.




Senator Escudero. Thank you, Mr. President. I will be very brief.

Ms. Josef, tama po ba ako pag sinabi ko na iyong sequence ng events: negotiation para bilhin

ang isang unit o bahay, tapos Contract to Sell, tama po ba?

Ms. Josef. Opo.

Senator Escudero. Tapos Deed of Sale?

Ms. Josef. Opo.

Senator Escudero. Tapos CAR?


Senator Escudero. Tapos CCT or TCT?


Senator Escudero. Tapos turnover?


Senator Escudero. Tapos acceptance, ganoon po ba iyon?


Senator Escudero. So the final act is acceptance?

Ms. Josef. In this case, Sir, yes.

Senator Escudero. Pag tinanggap na iyong unit, tapos na, wala na kayong kailangang pag-

usapan, bahala na siya sa buhay niya?


Senator Escudero. Mr. President, that is all for the witness actually. But may I ask with the

leave of this Presiding Officer just to put in proper place and perspective what both sides seem to be—

well, they seem to be trying to imply or prove para lang maintindihan din natin at nung mga

sumusubaybay nito.

Tama ba ang teorya ng Prosecution, Attorney? Pag in-execute iyong Deed of Sale, ang teorya

ninyo dapat nilagay na sa SALN? Is that your position?

Mr. Ginez. Our position—That is correct, Your Honor. Tama po iyon dahil ang Deed of

Absolute Sale ayon po sa ating Kodigo Sibil ay naita-transfer na po ang ownership pag mayroongpublic instrument delivering the property, and that is called “constructive”—

Senator Escudero. And that is your theory?


Senator Escudero. I presume the theory of the Defense is acceptance as you have been trying

to harp on.

Mr. Cuevas. Oh, yes, Your Honor. Definitely, yes, because it is a statement made under oath

by the declarant, your Honor.




Senator Escudero. Mr. President, I do not want to belabor that point and cause the parties to

argue really.

May I ask that they submit a memorandum on the matter so that we can get their position on this

because it seems that this is a continuing line of questioning for both the Prosecution and the Defense,

the date of the sale and the date of the acceptance. Can we get authorities to support—

Mr. Ginez. Yes, Your Honor. I am ready to cite, Your Honor, the authority.

Mr. Cuevas. Willingly, Your Honor.

The Presiding Officer. Wait a minute.

Senator Escudero. No, just to submit a memorandum, Mr. President.

The Presiding Officer. This is so ordered.


The Presiding Officer. This is a question of law and so the parties are required to submit theirrespective memorandum to convince this Court which side is the correct side.

Senator Escudero. Thank you, Mr. President. That will be all, Mr. President.

The Presiding Officer. So ordered.


Senator Sotto. Senator Drilon, Mr. President.

The Presiding Officer. The Gentleman from Iloilo has the floor.

Senator Drilon. Madam Witness, iyong susi ba ng apartment nasaan, iyong susi ngApartment 31-B?

Ms. Josef. Right now, I am not aware, Sir, right now.

Senator Drilon. Okay. Iyong susi ba kinuha na ng mga Corona? Hawak na ba nila

iyong susi?

Ms. Josef. As far as I know, Sir, they are—

Senator Drilon. Huh?

Ms. Josef. As far as I know, Sir, they are already in possession of the unit.

Senator Drilon. Ah, as far as you know, they are already in possession of the unit.


Senator Drilon. Would you know when they had possession of the unit per your recollection?

Ms. Josef. It wass in 2008, Sir. I have no exact date.

Senator Drilon. They had possession in 2008 although you do not have the exact date.





Senator Drilon. You know, I would like to seek the help of both Prosecution and Defense. I

have been trying to look at these exhibits on the SALN. Saan po ba rito iyong unit na pinag-

uusapan natin? What is the description? Because this unit is in Makati and I do not see any Makati

condo here, except in Exhibit “M” which is the SALN of Chief Justice Renato Corona as of December

31, 2010, and this is the first time that there is an entry “Condo” under the column Kind; and then

Location, Makati; Year Acquired, 2003; Mode of Acquisition, Installment; Assessed Value, ±

726,000; Current Fair Market Value, ± 1,210,000. Ito po ba iyong ating pinag-uusapan? Aling

ba ditto ang condominium ang ating pinag-uusapan dito?

Mr. Ginez. We confirm, Your Honor, for the Prosecution that this is the condominium unit, Your

Honor, the No. 3 entry in the Statement of Assets and Liabilities as of December 31, 2010, marked

previously as Exhibit “N” for the Prosecution, Your Honor. So, it was first disclosed only in 2010,

Your Honor.

Senator Drilon. My problem is that the year acquired is 2003 and from what I recall, the witness

is saying this was paid for in 2004. That is why I am a little bit confused as to which unit we are talking

about. So, this is the unit. Is this the unit which is described as acquired or purchased in 2004?

Mr. Ginez. If I may, Your Honor, the reason it was stated and I am just supposing, Your Honor,

“Year Acquired” because the purchaser began paying the installment in 2003 and made the full

payment in March of 2004 and the Deed of Absolute Sale in October of 2004. So, the reason maybe,

that is why they put “Year Acquired, 2003,” because it was on that year that they paid the deposit and

subsequent installment. And as of December 31, 2003, Your Honor, 95 percent of the purchase price

was already paid.

Senator Drilon. I see. Okay. So, well, I am more confused. Anyway, just to make clear, this

is the entry that we are talking about.

Mr. Ginez. Yes, Your Honor, because this is the only property that we know of as of now, Your

Honor, of Chief Justice Corona in Makati City.

Thank you.

Senator Sotto. Senator Francis Pangilinan, Mr. President.

The Presiding Officer. The Senator from Pampanga, Senator Pangilinan.

Senator Pangilinan. Thank you, Mr. President.

May we have a clarification from the Defense. Because, well, my understanding is the Defense is

saying that there was no acceptance of this property, actual acceptance. And therefore there was no

transfer of ownership. Is that my—just to—Mr. Cuevas. The burden of proof is on their part. They are questioning the validity, the

correctness and the accuracy of the entries in this particular document, Your Honor. I do not think

we have to plead our case yet unless they have made a prima facie case of the violation of the law

involving SALN, Your Honor.

Senator Pangilinan. Okay, I understand that. And therefore, well, just as a clarification, the

condo unit—you may or may not reply, Justice Cuevas ‘no. So, it is just my understanding therefore

that the condo unit in Makati that was acquired in 2003, according to the SALN, by installment, is now

subject to discussion or debate as to whether it was actually acquired or transferred or not. This is

now where I am—but I suppose when the Defense comes to their turn and they will be able to—




Mr. Cuevas. It is our humble submission, if Your Honor please, that the burden of proving what

this unit is, when it was acquired and so on and why, is on the part of the Prosecution because

we enjoy the presumption of innocence, Your Honor, and the burden of proof is not shifted to us

unless there is a prima facie case. All they stated there was a purchase. Okay. There was transfer.

The burden of proof is still on their part, Your Honor. I think every member of the Bar will agree

with us that these are matters that should be proven by them and not merely speculate, not merely

report this on.

Mr. Ginez. May I be allowed, Your Honor?

Mr. Cuevas. That is our humble submission, Mr. Senator.

The Presiding Officer. Anyway—just a minute. If there’s no more question from the witness,

let the witness be discharged.

Is there any question—

Mr. Ginez. Your Honor, I just want to make a counter- manifestation because that is a

manifestation, Your Honor.

The Presiding Officer. Wait a minute. Let us dispose first with the discharge of—

Senator Sotto. Mr. President, Senator Osmeña wishes to ask the witness.

The Presiding Officer. Okay. All right, proceed. Let the witness stay.

Senator Osmeña. Just a couple of short questions, Mr. President.

Madam Witness, the Ayala Land or Creative Innovations Condominium Development at the

end of Ayala Avenue, almost on the corner of Buendia is called The Columns.

Ms. Josef. Yes, Your Honor.

Senator Osmeña. How many buildings or towers constitute The Columns?

Ms. Josef. There are three (3) towers, Your Honor.

Senator Osmeña. And what is the total number of units in all three towers, more or less?

Ms. Josef. There are about 800 units.

Senator Osmeña. Eight hundred (800) units?


Senator Osmeña. When did construction start?

Ms. Josef. The construction started 2003, Your Honor.

Senator Osmeña. This is on the old Zuellig lot? Are you familiar with that or close to the Zuellig

property?

Ms. Josef. Yes, Sir. It is close to the Zuellig property.

Senator Osmeña. All right.

Can you tell us the type of discounts Ayala Land gave on The Columns?




Ms. Josef. It depends, Sir, on the buyer but we would have discounts based on the payment

schemes of the buyers.

Senator Osmeña. Just on the payment scheme?

Ms. Josef. Yes, sir.

Senator Osmeña. Would this range from 5 percent to 15 percent—what would be the maximumamount of discounts you would give for a sale at a cash buyer?

Ms. Josef. At that time, Sir, it will probably range at about 10 percent, Sir.

Senator Osmeña. Ten percent.

Did any of the units sell at a 30- or 40-percent discount?

Ms. Josef. Not that I know of, Sir.

Senator Osmeña. All right. Just please check that so that you can confirm and notify the Court

if any sold even at 20, 30 or 40 percent discount.

Thank you very much.

Senator Sotto. No more.

Mr. President, he has withdrawn. Senator Pimentel has withdrawn.

We are now ready to discharge the witness, Mr. President.

Mr. Ginez. May I be allowed, Your Honor, to make my counter- manifestation to Justice Cuevas’

manifestation, Your Honor?


Mr. Ginez. Your Honor, Justice Cuevas, our esteemed colleague in the profession, had said that

we have not discharged our burden of proof, Your Honor. Witness and the public had already

witnessed, Your Honor, that we have proven so far that there was full payment, a Deed of Absolute

Sale was executed, a title was issued.

So our brethren in the profession will agree with me, Your Honor, and the Supreme Court will also

agree with me. I have here an en banc decision, Your Honor, which says, “That upon execution of

a Deed of Absolute Sale, there is a constructive delivery of the thing sold and that ownership is sold

upon execution of the Deed of Absolute Sale” which in this case, Your Honor, was made as of October

1, 2004. So it was the duty then of the Chief Justice, Your Honor, to put this into his SALN as of

December 31 and subsequent years, Your Honor.

That is all, Your Honor.

The Presiding Officer. Anyway, this is a disputed legal issue. You are required to submit your

memoranda, your respective memorandum on this particular issue, if I recall what was suggested by the

gentleman from Sorsogon. So include all of these arguments including the jurisprudence and let it be

resolved by the Court.

Mr. Ginez. We will, Your Honor. We will submit the same on Monday, Your Honor.

The Presiding Officer. Submit it. How long do you want to submit the memorandum?




Mr. Ginez. Monday, Your Honor.

The Presiding Officer. Huh?

Mr. Ginez. Next Monday, Your Honor.

The Presiding Officer. Monday?




The Presiding Officer. You are ordered to submit your respective memorandum on Monday.

The Presiding Officer. Senator Pimentel has the floor.

Senator Pangilinan.

Senator Pangilinan. Yes. Just that they may include in the memorandum, Mr. Senate President,a clarificatory question.

The SALN for 2010 admits to a condo unit that was acquired in 2003 by installment. So if there

is an admission in the SALN of an acquisition of a property by installment in 2003, what is this issue

of whether or not ownership has been transferred or not?

So, just include it, please, in the memorandum.



Senator Sotto. Mr. President, as I said, we are ready to discharge the witness.

The Presiding Officer. The witness is discharged.

No other matter being asked from this witness?

Senator Sotto. No other matter, Mr. President.

The Presiding Officer. All right. You are discharged.

Senator Sotto. Mr. President, Mr. Noli Hernandez of Megaworld, who testified yesterday, was

asked by the Court to submit certain documents. He has filed a written request for additional time not

later than 10 February 2012 to search for and voluntarily submit whatever documents are available.Will we grant the request, Mr. President?

The Presiding Officer. The request is reasonable and the Chair grants the request.

Senator Sotto. Additional request from Senator Osmeña on this matter, Mr. President.

The Presiding Officer. The gentleman from Cebu has the floor.

Senator Osmeña. Thank you, Mr. President.

In addition, may we request the Court to subpoena, along with the date of turnover of Unit

No. 38-B or the penthouse to Justice Corona, the date of Justice Corona’s acceptance of 38-B




and the date of the transfer of title? And, finally, to include the Master Deed of the Bellagio I Condo

Corporation which includes attached floor plans or the condo layout plan.

Thank you very much, Mr. Chairman.

The Presiding Officer. The Clerk of Court is ordered to prepare the subpoena as requested by

the distinguished Senator from Cebu for final action by the Chair.Senator Sotto. Mr. President, may we ask the Sergeant-at-Arms to make an announcement?


The Sergeant-at-Arms. Please all rise.

All persons are commanded to remain in their places until the Senate President and the Senators

have left the Session Hall.

Senator Sotto. Mr. President, I move to adjourn until two o’clock in the afternoon of Thursday,

February 2, 2012.

The Presiding Officer. Is there any objection? [Silence]

The motion of the Floor Leader is approved.

The trial was adjourned at 6:15 p.m.

Documents

Feb 1 Senate impeachment court record