G.R. No.

196045, February 21, 2018

PEOPLE OF THE PHILIPPINES, Petitioner, v. AMADOR PASTRANA AND

RUFINA ABAD,

(Penal Provision)

The sacred right against an arrest, search or seizure without valid warrant is not only
ancient. It is also zealously safeguarded. The Constitution guarantees the right of the
people to be secure in their persons, houses, papers, and effects against unreasonable
searches and seizures. Any evidence obtained in violation of said right shall thus be
inadmissible for any purpose in any proceeding. Indeed, while the power to search and
seize may at times be necessary to the public welfare, still it must be exercised and the
law implemented without contravening the constitutional rights of the citizens; for the
enforcement of no statute is of sufficient importance to justify indifference to the basic
principles of government.1

Facts:

In this case, Search Warrant No. 01-118 was issued for "violation of R.A. No. 8799 (The
Securities Regulation Code) and for estafa (Art. 315, RPC)."33

SI Gaerlan alleged that he received confidential information that respondents were

engaged in a scheme to defraud foreign investors.

Amador Pastrana and Rufina Abad through their employees scattered throughout their
numerous companies call prospective clients abroad and convince them to buy shares of
stocks in a certain company likewise based abroad. Once the client is convinced to buy
said shares of stocks, he or she is advised to make a telegraphic transfer of the money
supposedly intended for the purchase of the stocks. The transfer is made to the account of
the company which contacted the client. Once the money is received, the same is
immediately withdrawn and brought to the treasury department of the particular
company. The money is then counted and eventually allocated to the following: 42% to
Pastrana, 32% for the Sales Office, 7% for the redeeming clients (those with small
accounts and who already threatened the company with lawsuits), 10% for the cost of
sales and 8% goes to marketing. No allocation is ever made to buy the shares of stocks.46

Issue: W/N THAT SAID WARRANT WAS ISSUED IN CONNECTION WITH THE
CRIME OF VIOLATION OF SECTION 28.1 OF R.A. NO. 8799 is valid.
Ruling:

Reasonable particularity of the description of the things to be seized

In fine, Search Warrant No. 01-118 is null and void for having been issued for more than
one offense and for lack of particularity in the description of the things sought for seizure.

Moreover, the SRC is not merely a special penal law. It is first and foremost a
codification of various rules and regulations governing securities. Hence, it is imperative
to specify what particular provision of the SRC was violated.

Violation of the SRC is not an offense in itself for there are several punishable acts under
the said law such as manipulation of security prices,34 insider trading,35 acting as dealer
or broker without being registered with the SEC,36 use of unregistered exchange,37 use of
unregistered clearing agency,38 and violation of the restrictions on borrowings by
members, brokers, and dealers39 among others. For these reasons alone, it can be easily
discerned that Search Warrant No. 01-118 suffers a fatal defect.
[ G.R. NO. 171815, August 07, 2007 ]

CEMCO HOLDINGS, INC., PETITIONER, VS. NATIONAL LIFE INSURANCE

COMPANY OF THE PHILIPPINES, INC., RESPONDENT.

Principles:
Tender offer is a publicly announced intention by a person acting alone or in concert with
other persons to acquire equity securities of a public company. A public company is
defined as a corporation which is listed on an... exchange, or a corporation with assets
exceeding P50,000,000.00 and with 200 or more stockholders, at least 200 of them
holding not less than 100 shares of such company.Stated differently, a tender offer is an
offer by the acquiring person to... stockholders of a public company for them to tender
their shares therein on the terms specified in the offer.Tender offer is in place to protect
minority shareholders against any scheme that dilutes the share value of their
investments. It gives the minority shareholders the chance to exit the company under
reasonable terms, giving them the opportunity to sell their shares at the same price as
those of the majority shareholders
The rule in this jurisdiction is that the construction given to a statute by an administrative
agency charged with the interpretation and application of that statute is entitled to great
weight by the courts, unless such construction is clearly shown to be in sharp contrast
with... the governing law or statute. The rationale for this rule relates not only to the
emergence of the multifarious needs of a modern or modernizing society and the
establishment of diverse administrative agencies for addressing and satisfying those
needs;... it also relates to accumulation of experience and growth of specialized
capabilities by the administrative agency charged with implementing a particular statute.

Facts:

Union Cement Corporation (UCC), a publicly-listed company, has two principal

stockholders - UCHC, a non-listed company, with shares amounting to 60.51%, and
petitioner Cemco with 17.03%. Majority of UCHC's stocks were owned by BCI with
21.31% and ACC with 29.69%. Cemco, on the other hand, owned 9% of UCHC stocks.
BCI informed the Philippine Stock Exchange (PSE) that it and its subsidiary ACC had
passed resolutions to sell to Cemco BCI's stocks in UCHC equivalent to 21.31% and
ACC's stocks in UCHC equivalent to 29.69%.

Subsequent exchange of letters between SEC and PSE happened if the tender offer rule is
applicable but nonetheless inapplicable as per SEC.
Issue:

Whether or not the SEC has jurisdiction over respondent's complaint and to require
Cemco to make a tender offer for respondent's UCC shares.

Whether or not the rule on mandatory tender offer applies to the indirect acquisition of
shares in a listed company, in this case, the indirect acquisition by Cemco of 36% of
UCC, a publicly-listed company, through its purchase of the shares in UCHC, a non-
listed company.

Ruling:

SEC the general adjudicative power which is implied from the express powers of the
Commission or which is incidental to, or reasonably necessary to carry out, the
performance of the administrative duties entrusted to it. As a regulatory agency, it has the
incidental power to conduct hearings and render decisions fixing the rights and
obligations of the parties.