Monday, January 25, 2010

A case of malicious prosecution?

As a follow-up to the Supreme Court Round-up as of January 20, 2010, a discussion of one interesting case regarding recovery of damages for malicious prosecution would be in order.

In this case, the City of Olongapo charged a hotel owner with the (a) theft of electrical current punished under Presidential Decree (P.D.) 401; and (b) disengaging and tampering with his electric meter’s potential link, thereby resulting to a zero-zero power consumption in violation of City Ordinance 23, series of 1989, and P.D. 401.

After the preliminary investigation, the state prosecutor issued a resolution, dismissing the complaints for insufficiency of evidence. On appeal, however, the Acting Secretary of Justice modified the State Prosecutor’s resolution and directed the filing of the corresponding information for theft of electricity against petitioner Tiu. Subsequently, however, the Secretary of Justice reconsidered and ordered instead the withdrawal of any information that might in the meantime have been filed in court. When the matter was elevated to the Court of Appeals (CA) and, ultimately, to the Supreme Court, both courts affirmed the dismissal of the City’s complaints against the hotel owner.

Claiming that he suffered mental anguish, serious anxiety, besmirched reputation, wounded feelings, moral shock and social humiliation and that the hotel suffered loss of business goodwill, financial reverses, and injured reputation, the owner and the hotel both filed an action for damages against the City for having filed a malicious and unfounded charge of theft of electricity against them.

The Regional Trial Court dismissed the case, which was affirmed by the Court of Appeals.

On appeal the Supreme Court said that in order to establish a case for malicious prosecution, the hotel and the hotel owner must prove the following elements: (1) that the respondent City had caused their prosecution; (2) that the criminal action ended in their acquittal; (3) that, in bringing the action, the City had no probable cause; and (4) that it was impelled by legal malice—an improper or a sinister motive. Both parties concede that the first two elements were present in this case. What needs to be determined is whether or not petitioners have proved the last two elements.

The respondent City did not concoct out of thin air the criminal charge for theft of electricity against petitioners. It filed the case based on the result of an investigation carried out at petitioner’s premises which indicated a tampering of the electric meter. Indeed, petitioners never claimed that the inspection of petitioner's premises was just a farce. The City did not merely conjure the charge with the intention of vexing petitioners. It acted within its right to bring up the result of that investigation to the authorities for evaluation and resolution.

Finally, no evidence was shown that there had been bad blood between respondent City and petitioners prior to the filing of the criminal charge, which circumstance if present could justify a malicious motive in filing the charge. Resort to judicial processes, by itself, is not an evidence of ill will which would automatically make the complainant liable for malicious prosecution. Otherwise, peaceful recourse to the courts will be greatly discouraged and the exercise of one’s right to litigate would become meaningless and empty.

Even if the Court were to concede that the City branded petitioners as thieves, asked the people not to patronize their business, and had been overly zealous in pursuing the criminal complaint that it filed, these are not the legal malice contemplated in suits for malicious prosecution as the determining factor is evil motive in bringing the action, not the acts exhibited by the complainant after the case had been filed.


Bad faith is the foundation for this kind of case for damages. Considering that the complainant is the City Government of Olongapo, which is a government instrumentality, it could easily rely on the presumption of regularity of its conduct in the filing of those cases of Theft of Electricity. Thus, in spite of having lost its criminal cases, the City has a strong defense against a counter-charge for malicious prosecution.

It would be interesting to note, however, if this case would prosper before the Ombudsman against the officials involved under Sec. 3 (e) R.A. 3019, which punishes officials for "...(e) Causing any undue injury to any party, including the Government, or giving any private party any unwarranted benefits, advantage or preference in the discharge of his official administrative or judicial functions through manifest partiality, evident bad faith or gross inexcusable negligence..."

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