G.R. No. 165122 Case Digest

G.R. No. 165122, November 23, 2007

Rowland Kim Santos, petitioner,

vs PRYCE Gas Inc., respondents

Ponente: Tinga

Facts:

This is a petition for review on the decision of Court of Appeals to reversed the twin orders of RTC Iloilo City quashing the warrant it issued and ordering the return of LPG cylinders seized from petitioner.

Pryce is a domestic corporation engaged in manufacturing and distributing industrial gases and LPG products. In 2002, Pryce noticed the decline of return of LPG cylinders for refilling. Pryce employees suspected that LPG cylinders had been removed from market circulation and refilled by their competitors, one of whoom is Sun Gas and Santos as the manager.

Figueroa, Pryce's sales manger for Panay sought the assistance of CIDG to recoverLPG cylinders allegedly in posession of Sun Gas. Criminal Investigation and Detection Group (CIDG) conducted surveillance on the warehouse of Sun Gas then later requested the Bureau of Fire Protection (BFP) to conduct a routine fire inspection at Sun Gas. CIDG operatives entered the warehouse and were able to take photographs of LPG cylinders (PO@ Demandara).

Demandara applied before RTC Iloilo for a warrant to search the premises with the allegation that Pryce LPG cylinders were tampered and replaced with Sun Gas marking, averred also that Sun Gas is distributing Pryce LPG products without the consent of Pryce. RTC issued the search warrant with the authority to seize the following items: 1. Assorted sizes of PRYCE LPG GAS TANKS CYLINDERS in different kilograms.

2. Suspected LPG gas tanks cylinders with printed/mark SUN GAS INC., trademark and embossed Pryce Gas Trademark scrapped off.

3. Other materials used in tampering the PRYCE LPG GAS TANKS cylinders. The authorities have seize a number of Pryce LPG tanks.

Santos then filed for motion to quash the search warrant on the grounds of lack of probable cause as well as deception and fraud in obtaining evidence in support of the application, violating article 3, section 2 of constitution and Rule 126 of rules of court.

On the same day, CIDG filed a criminal complaint before the office of City Prosecutor of Iloilo against Santos, charging him with violation of RA No. 632.

After hearing, RTC granted the motion to quash , stating that the probable cause as found by it at the time of the application for search warrant fell short of the requisite probable cause necessary to sustain the validity of the search warrant.

Respondent filed a manifestation and motion to hold in abeyance the release of the seized items. It also filed a motion for reconsideration of the 16 July 2002 Order but was denied in an Order dated 9 August 2002.

         

Respondent elevated the matter to the Court of Appeals via a special civil action for certiorari, arguing that the trial court committed grave abuse of discretion in quashing the search warrant. The petition essentially questioned the quashal of the search warrant despite a prior finding of probable cause and the failure of petitioner to prove that he bought the seized items from respondent. It also challenged petitioner’s personality to file the motion to quash.

On 16 January 2004, the Court of Appeals rendered the assailed Decision, which set aside the two orders of the trial court. The appellate court also ordered the return of the seized items to respondent. Petitioner sought reconsideration but was denied in an order dated 16 July 2004.

Issues: (1) whether or not petitioner has authority to seek the quashal of the search warrant; (2) who has proper custody of the seized items; and (3) whether or not respondent correctly availed of the special civil action for certiorari to assail the quashal of the search warrant.

Ruling:

1. The Court of Appeals ruled against petitioner and reversed the trial court’s quashal of the search warrant solely on the ground that petitioner, being a mere manager of Sun Gas, Inc., failed to show his authority to act on behalf of the corporation and, therefore, had no legal personality to question the validity of the search warrant. Thus, it concluded that the trial court committed grave abuse of discretion in entertaining and subsequently granting petitioner’s motion to quash.    

Well-settled is the rule that the legality of a seizure can be contested only by the party whose rights have been impaired thereby, and the objection to an unlawful search and seizure is purely personal and cannot be availed of by third parties.

2. In quashing the search warrant, it would appear that the trial court had raised the standard of probable cause to whether there was sufficient cause to hold petitioner for trial. In so doing, the trial court committed grave abuse of discretion.

Probable cause for a search warrant is defined as such facts and circumstances which would lead a reasonably discrete and prudent man to believe that an offense has been committed and that the objects sought in connection with the offense are in the place sought to be searched. A finding of probable cause needs only to rest on evidence showing that, more likely than not, a crime has been committed and that it was committed by the accused. Probable cause demands more than bare suspicion; it requires less than evidence which would justify conviction.

3. The Court of Appeals, however, erred in ordering the return of the seized items to respondent. Section 4, Rule 126 of the Revised Criminal Procedure expressly mandates the delivery of the seized items to the judge who issued the search warrant to be kept in custodia legis in anticipation of the criminal proceedings against petitioner. The delivery of the items seized to the court which issued the warrant together with a true and accurate inventory thereof, duly verified under oath, is mandatory in order to preclude the substitution of said items by interested parties. The judge who issued the search warrant is mandated to ensure compliance with the requirements for (1) the issuance of a detailed receipt for the property received, (2) delivery of the seized property to the court, together with (3) a verified true inventory of the items seized.  Any violation of the foregoing constitutes contempt of court.

The seized items should remain in the custody of the trial court which issued the search warrant pending the institution of criminal action against petitioner.

Petition denied.