THE Sandiganbayan has ordered the Traders Royal Bank (TRB, now Royal Traders Holding Co. Inc.) to pay the Philippine government P96.03 million and $5.435 million representing the face value of bank certificates previously held by the Marcos family.
Based on the prevailing exchange rate of $1: P50.96, the anti-graft court’s ruling is worth at least P373 million.
However, the amount could grow a lot bigger since the Sandiganbayan Second Division also imposed a 12 percent yearly interest to be computed starting February 1993 until fully paid.
In a 52-page decision dated September 24, 2021, the court held that the TRB is liable to the Republic of the Philippines for the value of the bank certificates seized by the United States Customs Service from the Marcos family when they landed in Honolulu on February 26, 1986.
Associate Justice Oscar C. Herrera Jr., chairperson of the Second Division, penned the ruling with Associate Justices Michael Frederick L. Musngi and Bayani H. Jacinto concurring.
“Mr. Marcos and his family, among others, flew to Honolulu, Hawaii. They brought with them numerous crates of boxes, suitcases, bags, etc. containing jewelry, money, documents and other properties,” the court noted in its decision.
The Presidential Commission on Good Government (PCGG) petitioned the US government for the return of the confiscated Marcos assets resulting in an interpleader litigation involving another claimant, Roger Roxas and the Golden Buddha Corporation, and the Marcoses.
On October 25, 1991 the Philippine government entered into several agreements with former first lady Imelda Marcos who acted as the representative of her family and the estate of her husband who had died earlier in 1989.
The agreements were entitled “The Settlement Agreement and Partial Release of Claims, the Conveyance Grant and Bill of Sale, and the Waiver and Release of Claims and Assignment of Interest,” or simply the “Settlement.”
In its December 18, 1992 decision, the US District Court of the District of Hawaii declared that Imelda Marcos had assigned to the Republic of the Philippines not only her personal interest on the assets subject of the litigation, but also the interest of the estate of her late husband since she was acting as “executor of the estate of Ferdinand Marcos.”
In exchange, the Republic of the Philippines agreed to dismiss other legal actions brought by the government against the Marcoses and they were dropped as parties in the interpleader action.
While the government has been able to recover the other Marcos assets, the TRB refused to pay when the PCGG presented the bank certificates to it on February 26, 1993.
This prompted the filing of Civil Case no. 0181 on December 9, 1997, asking the Sandiganbayan to compel the TRB to pay the value of the Marcos bank certificates, transfer in favor of the State the ownership of 278,488 TRB shares registered in the name of the Royal Bank of Canada (RBC), and to pay attorney’s fees and five percent of the amount being claimed.
In its decision, the Sandiganbayan Second Division ruled that the government is only entitled to recover the value of the TRB shares assigned to it by Imelda Marcos.
However, it said the RBC shares must be excluded since there was insufficient evidence to show that they are part of the Marcos ill-gotten wealth.
BANK OF COMMERCE CLEARED
The anti-graft court likewise cleared the Bank of Commerce which was impleaded when the original complaint was amended in 2005.
It noted that while Bank of Commerce acquired the assets and liabilities of TRB under a November 9, 2001 purchase and sale agreement, there was an express stipulation that the buyer was to be excluded from pending claims of the Philippine government.
The TRB-Bank of Commerce deal was worth P10.41 billion.
The Traders Royal Bank also amended its Articles of Incorporation, changing its corporate name to Royal Traders Holding Co. Inc. and deleting “banking” from its operation, thereby effectively ceasing to be a bank without dissolution of its corporate existence.
In its ruling, the Sandiganbayan noted that the Bangko Sentral ng Pilipinas ordered TRB and Bank of Commerce to put up a P50 million in escrow in another bank to protect contingent claims.
