SC not involved in economic policy-making — Chief Justice

The Supreme Court (SC) is not engaged in economic policy-making as it does not decide on economic or commercial issues, Chief Justice Artemio Panganiban said before an assembly of corporate lawyers.

He stressed that when the SC nullified certain government contracts in the past, it merely exercised its duty to strike down contracts that violated the Constitution and laws, or had otherwise been entered into "with grave abuse of discretion."

The Chief Justice was guest of honor Friday during the 40th anniversary celebration of the Legal Management Council of the Philippines, led by Procter and Gamble Phils. senior counsel Gafar Lutian.

Panganiban himself had served as director and vice president of the organization of corporate lawyers and corporate law service providers.

The SC has nullified contracts entered into by the government, such as those for the reclamation of portions of Manila Bay (PEA-Amari case), the construction of the new Manila International Airport Terminal (Piatco contract), and the automation of the 2004 national elections.

He stressed that in conflicts affecting policies on prosperity and development, deference must be accorded to the political branches of government, namely the Presidency and Congress, noting that as a rule, courts will not pass upon the merits or wisdom of economic policies, for these matters have been left by the people to the President and Congress to evaluate and decide.

This laissez-faire judicial policy on economic issues, Panganiban said, was reiterated in one decision which he penned, affirming the constitutionality of the mining law allowing 100 percent foreign investments in large-scale mining.

This decision, he pointed out, does not mean that the courts will abdicate their duty of striking down gravely abusive legislative or executive acts that clearly violate the Constitution, the laws, or settled jurisprudence, or those that have been issued with arbitrariness, whim, caprice, bias, or personal hostility, as shown by the SC’s nullification of certain government contracts.

He noted that most government and corporate scandals arise from the ethical myopia of those involved, as seen in the recent convictions of the founder and CEO of energy giant Enron. In Aug. 2005, the chairman of WorldCom was sentenced to 25 years in prison for fraud and conspiracy in the $11-billion accounting scandal surrounding the US company’s bankruptcy. Also recently, the founder of Korean chaebol Daewoo was found guilty of fraud and was ordered to forfeit $22 billion.

Panganiban pointed out that recent events have impelled him to advocate an indispensable link between political liberty and economic prosperity. These include the constitutional mandate to distribute income and wealth, the need for lasting solutions to economic deprivation, the need for a stable judiciary to alleviate poverty, and the social responsibility of Philippine business. "The only justification for accumulating enormous wealth is the zeal and the ability to distribute it wisely to the needy and the hungry," he said.

"These four developments, among others, convince me that the prosperity of our people requires as much nurturing in the present century as that accorded to liberty in the past. To be relevant, courts must be constantly attuned to the needs of the present and the vagaries of the future, so that they can respond timely and prudently to the people’s ever-expanding well-being," he added.