EN BANC
[G.R. No. 171101. September 13, 2016.]
HACIENDA LUISITA, INCORPORATED AND LUISITA INDUSTRIAL PARK CORPORATION, ET AL., petitioners, vs. PRESIDENTIAL AGRARIAN REFORM COUNCIL, ET AL., respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court en banc issued a Resolution datedSEPTEMBER 13, 2016, which reads as follows:
"G.R. No. 171101 (Hacienda Luisita, Incorporated and Luisita Industrial Park Corporation, et al. vs. Presidential Agrarian Reform Council, et al.). — This is with reference to the (1) Entry of Appearance with Motion for Clarification (Re: Notice of Resolution dated 28 January 2014) dated September 30, 2014 filed by Navarro Amper & Co. (NA&Co.) relative to the audit of petitioner Hacienda Luisita, Incorporated (HLI) and Centennary Holdings, Inc.'s books to determine if the Php1,330,511,500.00 proceeds of the sale of three (3) lots were actually used or spent for legitimate corporate purposes; (2) HLI's Comment (On the Motion for Clarification dated 30 September 2014 filed by Navarro Amper & Co.) dated January 20, 2015; and (3) HLI's Manifestation and Motion dated July 28, 2016.
On November 22, 2011, the Court issued a Resolution 1 for the Department of Agrarian Reform (DAR) to "engage the services of a reputable accounting firm approved by the parties to audit the books of HLI and Centennary Holdings, Inc. to determine if the PhP1,330,511,500 proceeds of the sale of the three (3) aforementioned lots were actually used or spent for legitimate corporate purposes."
The material portion of the fallo of said Resolution reads:
HLI is directed to pay the original 6,296 FWBs the consideration of PhP500,000,000 received by it from Luisita Realty, Inc. for the sale to the latter of 200 hectares out of the 500 hectares covered by the August 14, 1996 Conversion Order, the consideration of PhP750,000,000 received by its owned subsidiary, Centennary Holdings, Inc., for the sale of the remaining 300 hectares of the aforementioned 500-hectare lot to Luisita Industrial Park Corporation, and the price of PhP80,511,500 paid by the government through the Bases Conversion Development Authority for the sale of the 80.51-hectare lot used for the construction of the SCTEX road network. From the total amount of PhP1,330,511,500 (PhP500,000,000 + PhP750,000,000 + PhP80,511,500 = PhP1,330,511,500) shall be deducted the 3% of the proceeds of said transfers that were paid to the FWBs, the taxes and expenses relating to the transfer of titles to the transferees, and the expenditures incurred by HLI and Centennary Holdings, Inc. for legitimate corporate purposes. For this purpose, DAR is ordered to engage the services of a reputable accounting firm approved by the parties to audit the books of HLI and Centennary Holdings, Inc. to determine if the PhP1,330,511,500 proceeds of the sale of the three (3) aforementioned lots were actually used or spent for legitimate corporate purposes. Any unspent or unused balance and any disallowed expenditures as determined by the audit shall be distributed to the 6,296 original FWBs. (emphasis ours)
Unfortunately, however, the selection of the accounting firm proved to be difficult as the parties could not agree thereon. As such, the DAR sought clarification from this Court on the matter through an Urgent Motion and Manifestation dated May 27, 2013.
Acting thereon, in order to finally put the issue at rest and to set the wheels of the special audit in motion, the Court issued on July 23, 2013 a Resolution directing the parties to submit their respective lists of ten (10) preferential audit firms for the conduct of said audit.
In compliance therewith, petitioner HLI submitted, on August 13, 2013, the following names:
a. Reyes Tacandong & Co.
b. Manabat San Agustin & Co. (KPMG)
c. Navarro Amper & Co. (Deloitte)
d. Isla Lipana & Co. (Pricewaterhouse Coopers)
e. Constantino Guadalquiver & Co. (Baker Tilly)
f. Villacruz, Villacruz & Co., CPAs
g. Mendoza Querido & Co.
h. Diaz Murillo Dalupan & Co.
i. Alas Oplas & Co., CPAs
j. Valdes Abad & Associates 2
On even date, Rene Galang and AMBALA manifested that their audit firm of choice is Ocampo Mendoza Leung and Lim (OMLL). 3 CAIHTE
Thereafter, or on November 29, 2013, Noel A. Mallari and Windsor B. Andaya nominated Ms. Carissa May Pay-Penson, CPA as their auditor of choice. 4
Acting on said recommendations, the Court issued a Resolution 5 on January 28, 2014, appointing (1) OMLL, (2) Ms. Carissa May Pay-Penson, and (3) NA&Co. as members of the panel tasked to conduct the special audit as directed in the Court's July 5, 2011 Decision.
Thereafter, or on May 7, 2014, the panel of auditors, together with HLI representatives, met and discussed the mechanics and necessary details of such audit. Notably, however, OMLL did not participate in said meeting. 6
In the course of their discussion, NA&Co. and Ms. Pay-Penson found it necessary to seek clarification of various matters pertaining to the procedure of the audit from the Court. 7 Thus, on October 2, 2014, NA&Co., through counsel, filed an Entry of Appearance with Motion for Clarification (Re: Notice of Resolution dated 28 January 2014) dated September 30, 2014, subject of the instant Resolution. 8
In said Motion for Clarification, NA&Co. seeks illumination on the following matters, to wit:
1. How the audit by a Panel shall be conducted;
2. Whether the Panel was engaged by the Court or by the parties to the case;
3. The scope of the audit and the procedure to be followed by the Panel;
4. The contents and attachments of the audit report to be submitted by the Panel to the Court; and
5. The commencement of the 90-day period within which the Panel shall submit to the Court its report and recommendation.
Furthermore, it is stated therein that the audit firm OMLL, which was appointed as one of the three (3) members of the Audit Panel, has yet to attend the meetings of the Panel and has not yet communicated with the other members. Thus, NA&Co. asks whether they can proceed with the audit despite the non-participation of OMLL. 9
On November 11, 2014, the Court issued a Resolution directing the parties, as well as Ms. Pay-Penson and OMLL, to file their respective Comments on said Motion. 10
To this day, OMLL has not complied with said directive.
In order not to further delay the audit, and in view of the apparent lack of interest on the part of OMLL, its appointment as member of the Audit Panel should be revoked. To complete the membership of the Audit Panel, the Court appoints Reyes Tacandong & Co. as the third member of the Audit Panel, replacing OMLL.
As for the other matters raised by NA&Co. in the instant Motion, We find it proper to refer such to the Panel in view of their expertise thereon.
Thus, acting on the Entry of Appearance with Motion for Clarification (Re: Notice of Resolution dated 28 January 2014) dated September 30, 2014 filed by Na&Co., as well as HLI's Comment (On the Motion for Clarification dated 30 September 2014 filed by Navarro Amper & Co.) dated January 20, 2015 and Manifestation and Motion dated July 28, 2016, We hold that:
1. Entry of Appearance with Motion for Clarification (Re: Notice of Resolution dated 28 January 2014) dated September 30, 2014 filed by Na&Co., as well as HLI's Comment (On the Motion for Clarification dated 30 September 2014 filed by Navarro Amper & Co.) dated January 20, 2015 and Manifestation and Motion dated July 28, 2016 are hereby NOTED;
2. The Audit Panel, once constituted, shall, by a majority vote, decide on the matters raised by NA&Co. pertaining to the conduct of the audit in the said Motion for Clarification dated September 30, 2014;
3. As regards HLI's Comment and Manifestation and Motion, the Court already ruled that its recommended accounting firm, Reyes Tacandong & Co., is designated as the third member of the Audit Panel, in lieu of OMLL; and
4. Anent HLI's prayer for the suspension of the 90-day period for the audit, the same is hereby DENIED in view of the instant Resolution.
WHEREFORE, premises considered, the instant incidents are resolved in accordance with the foregoing pronouncements. The appointment of Ocampo Mendoza Leung and Lim as member of the Audit Panel is hereby REVOKED. In its place, Reyes Tacandong & Co. is hereby APPOINTED as the third member of the Audit Panel, effective from receipt of this Resolution.
The duly authorized representative of Navarro Amper & Co. is designated as Chair of the Audit Panel, while Ms. Carissa May Pay-Penson and Reyes Tacandong & Co. are designated as members.
Any issue shall be resolved by majority vote of the Panel. DETACa
Navarro Amper & Co. is directed to immediately convene the Panel and expedite and terminate the audit prescribed by the November 22, 2011 Resolution within a period of ninety (90) days from date of initial meeting.
The Panel is ordered to submit a monthly report of their audit and a * Final Report on or before the lapse of the ninety (90)-day period." Carpio, J., no part. Bersamin, J., on official leave. Jardeleza, J., no part. (adv1)
Very truly yours,
(SGD.) FELIPA B. ANAMAClerk of Court
Footnotes
* 'Carpio, J., no part' and 'Jardeleza, J., no part,' added.
1. HLI v. PARC, 660 SCRA 525-691.
2. Rollo, p. 7808.
3. Id. at 7824.
4. Id. at 8286.
5. Rollo, Vol. 13, pp. 12522-12527.
6. Rollo, Vol. 12, p. 12285.
7. Id. at 12285-12286.
8. Id. at 12283-12307.
9. Id. at 12286.
10. Id. at 12338A-12338B.