G.R. NO. 118661 - REPUBLIC OF THE PHILIPPINES, VS. SANDIGANBAYAN (FIRST DIVISION), EDUARDO M. COJUANGCO, JR., PHILIPPINE COCONUT PRODUCERS FEDERATION, INC., MARIA CLARA L. LOBREGAT, AND THE CORPORATE SECRETARY OF THE SAN MIGUEL CORPORATION.

Ruling

Accordingly, the present petition shall be resolved taking into stock and in the light of the relevant findings and holdings in the supervening batch of cases. In this petition for certiorari under Rule 65 of the Rules of Court, the Republic of the Philippines (Republic, for short), represented by the Presidential Commission on Good Government (PCGG), seeks to annul and set aside a portion of the Order [4] dated September 9, 1994 of the Sandiganbayan (First Division) in its Civil Case No. 0102 , a joint petition for approval of a compromise agreement and settlement [5] interposed by certain corporations involving sequestered SMC shares of stocks. The factual background: In 1971, Republic Act (R.A.) No. 6260 was enacted creating the Coconut Investment Company to administer the Coconut Investment Fund ( CIF ), which was to be sourced from a levy of P0.55 on the sale of every 100 kilograms of copra or equivalent coconut product. In the course of implementing R.A. No. 6260, PHILCOA declared COCOFED as the recognized national association of coconut producers with the largest membership. [6] On June 30, 1973, then President Ferdinand E. Marcos issued Presidential Decree No. (P.D.) 232 creating the PCA to take over PHILCOAs powers and functions. [7] Then came P.D. 276 establishing the Coconut Consumers Stabilization Fund ( CCSF ) and declaring the proceeds of the CCSF levy as a trust fund. [8] From the CCSF was established, pursuant to P.D. 582, another fund, the Coconut Industry Development Fund ( CIDF ). On December 26, 1974, P.D. 623 went into effect, reducing the numerical composition, i.e., from 11 to 7 members, of the existing PCA's governing board, and thereby strengthening COCOFED by reserving three (3) board seats to those recommended by [COCOFED]. Also included in the new board structure was one member to be recommended by the owner/operator of the hybrid coconut seed nut farm. It would appear that in the new 7-man PCA Board initially sat herein respondent Maria Clara L. Lobregat (hereafter "Lobregat"), as COCOFED representative. Sitting as representative of the Bugsuk Hybrid Coconut Seed Nut Farm was herein respondent Eduardo M. Cojuangco, Jr. (hereafter Cojuangco, Jr."). At this juncture, it is relevant to mention some incidents referred to or recurring allegations made in several coco levy cases: 1. On May 17, 1975, the COCOFED's Board passed a resolution declaring that ownership by the coconut farmers of a commercial bank is a permanent solution to their perennial credit problems . [9] As events unfolded, the Boards bank of choice was the First United Bank (hereafter " FUB ") where Pedro Cojuangco was then the President. The plan then was for PCA to buy Pedro Cojuangco's controlling interest in FUB. However, the sale did not take a direct route from the seller (Pedro) to the buyer (PCA) as it was made to appear that Cojuangco, Jr. had the exclusive option to acquire Pedro's controlling interest in FUB. Emerging from the shroud