Jean L.

Arnaultvs Leon Nazareno

FACTS: y October, 1949, the Philippine Government,, through the Rural Progress Administration, bought two estates known as Buenavista and Tambobong for the sums of P4,500,000 and P500,000, respectively. Of the first sum, P1,000,000 was paid to Ernest H. Burt, a nonresident American, thru his attorney-in-fact in the Philippines, the Associated Estates, Inc., represented by Jean L. Arnault. The second sum of P500,000 was all paid to the same Ernest H. Burt through his other attorney-in-fact, the North Manila Development Co., Inc., also represented by Jean L. Arnault. y Buenavista Estate - originally owned by the San Juan de Dios Hospital. y June 29, 1946- the San Juan de Dios Hospital sold the Buenavista Estate for P5,000,000(annual pmt=500T) to Ernest H. Burwho made a down payment of P10,000. Burt has made no other payment. y Tambobong Estate- originally owned by the Philippine Trust Company. y May 14, 1946-PTC sold estate for P1,200,000(90T w/in 9mo, 10 installments of 110T)to Ernest H. Burtwho paid P10,000 down payment. 9months expired but Burtsdid not pay any other amount then or afterwards. y September 4, 1947- the PTC sold, conveyed, and delivered the Tambobong Estate to the Rural Progress Administration for P750,000. y February 5, 1948- the Rural Progress Administration made a notarial demand upon Burt for the resolution and cancellation of his contract of purchase y Subsequently the Court of First Instance of Rizal ordered the cancellation of Burts certificate of title and the issuance of a new one in the name of the Rural Progress Administration, from which order he appealed to the Supreme Court. Philippine Government, through the Secretary of Justice as Chairman of the Board of Directors of the Rural Progress Administration and as Chairman of the Board of Directors of the Philippine National Bank, from which the money was borrowed, accomplished the purchase of the two estates in the latter part of October, 1949, February 27, 1950 - the Senate adopted its Resolution No. 8, which creates a special committee to investigate the Buenavista and the Tambobong estates deal. The special committee examined various witnesses, among the most important of whom was the herein petitioner, Jean L. Arnault. An intriguing question which the committee sought to resolve was that involved in the apparent unnecessariness and irregularity of the Governments paying to Burt the total sum of P1,500,000 for his alleged interest of only P20,000 in the two estates, which he seemed to have forfeited anyway long before October, 1949. The committee sought to determine who were responsible for and who benefited from the transaction at the expense of the Government. Arnault testified that : y two checks payable to Burt aggregating P1,500,000 were delivered to him on the afternoon of October 29, 1949;

y y y

on the same date he opened a new account in the name of Ernest H. Burt with the PNB in which he deposited the two checks aggregating P1,500,000; y he draw two checks; one for P500,000, which he transferred to the account of the Associated Agencies, Inc., and another for P440,000 payable which he himself cashed. Arnault resisted to name the recipient of the P440,000 (he could not remember the name and his answer will be self-incriminating-contradictory: if he cannot give a name, how could his answer be self-incriminating? ). The senate then approved a resolution that cited him for contempt. It is this resolution which brought him to jail and is being contested in this petition. y

ISSUE 1:WON the Senate has no power to punish Arnault for contempt for refusing to reveal the name of the person to whom he gave the P440,000 HELD: Yes, Once an inquiry is admitted or established to be within the jurisdiction of a legislative body to make, the investigating committee has the power to require a witness to answer any question pertinent to that inquiry, subject of course to his constitutional right against self-incrimination. The inquiry, to be within the jurisdiction of the legislative body to make, must be material or necessary to the exercise of a power in it vested by the Constitution, and every question which the investigator is empowered to coerce a witness to answer must be material or pertinent to the subject of the inquiry or investigation. The power of the Court is limited to determining whether the legislative body has jurisdiction to institute the inquiry or investigation. This Court cannot control the exercise of that jurisdiction; and it is insinuated, that the ruling of the Senate on the materiality of the question propounded to the witness is not subject to review by this Court under the principle of the separation of power. ISSUE 2: WON the Senate lacks authority to commit Arnault for contempt for a term beyond its period of legislative session, which ended on May 18, 1950 HELD: NO, The Senate of the Philippines is a continuing body. Theres no reason to limit the power of the legislative body to punish for contempt to the end of every session and not to the end of the last session terminating the existence of that body. The very reason for the exercise of the power to punish for contempt is to enable the legislative body to perform its constitutional function without impediment or obstruction. To deny to such committees the power of inquiry with process to enforce it would be to defeat the very purpose for which that the power is recognized in the legislative body as an essential and appropriate auxiliary to is legislative function. The Senate, which is a continuing body, does not cease toexist upon the periodical dissolution of the Congress or of the House of Representatives. There is no limit as to time to the Senates power to punish for contempt in cases where that power may constitutionally be exerted as in the present case. ISSUE 3: WON the privilege against self incrimination protects the petitioner from being questioned HELD: NO, The Court is satisfied that those answers of the witness to the important question, which is the name of that person to whom witness gave the P440,000, were obviously false. His

insistent claim before the bar of the Senate that if he should reveal the name he would incriminate himself, necessarily implied that he knew the name. Moreover, it is unbelievable that he gave P440,000 to a person to him unknown. Testimony which is obviously false or evasive is equivalent to a refusal to testify and is punishable as contempt, assuming that a refusal to testify would be so punishable. Since according to the witness himself the transaction was legal, and that he gave the P440,000 to a representative of Burt in compliance with the latters verbal instruction, Court found no basis upon which to sustain his claim that to reveal the name of that person might incriminate him.