SC affirms govt claim over Cojuangco's UCPB shares

The Supreme Court has ruled that businessman Eduardo "Danding" Cojuangco is not entitled to shares in the United Coconut Planters Bank (UCBP) since the money used to buy it came from public funds. The shares are, therefore, public property. In its 50-page ruling, the high court affirmed a Sandiganbayan partial summary judgement that disallowed Cojuangco from acquiring shares from the said bank that were bought using coco levy funds because that would be a "violation of the constitutional caveat that public funds can only be used for public purpose." The controversial fund came from taxes imposed on coconut farmers during the martial law years by alleged cronies of then President Ferdinand Marcos, including Cojuangco, with the promise of sharing investments and development of the coconut industry. , The collections were allegedly used to fund the personal concerns of the Marcos cronies, including the purchase of the UCPB and a majority stake in food and beverage giant San Miguel – now a diversified conglomerate. , The fund was sequestered after Marcos was ousted in the February 1986 People Power revolution. Cojuangco was able to acquire the UCPB shares through an agreement he entered into on May 25, 1975 with the Philippine Coconut Authority, which allowed him to personally and exclusively own public funds or property by way of compensation amounting to 10 percent of the 72.2 percent shares that UCPB bought using coco levy funds., Among the UCPB shares transferred to Cojuangco were ,14,400 shares of stock of FUB (later UCPB) from the “Option Shares," as well as additional shares subscribed and paid by PCA, consisting of:, a. 15,884 shares out of the authorized but unissued shares of the bank, subscribed and paid by PCA; b. 64,980 shares of the increased capital stock subscribed and paid by PCA; and c. Stock dividends declared pursuant to paragraph 5 and paragraph 11 (iv) (d) of the PCA-Cojuangco Agreement dated May 25, 1975 or the so-called “Cojuangco-UCPB shares.” In its latest ruling, the high court struck down the agreement as unconstitutional. "Cojuangco no less, admitted that the PCA paid, out of the [coco levy fund], the entire acquisition price for the 72.2% option shares. This is in clear violation of the prohibition, which the Court seeks to uphold," the SC said. The high court ordered Cojuangco to return the UCPB shares to coffers of the government "for the benefit of all coconut farmers and for the development of the coconut industry.” "The coconut levy funds were exacted for a special public purpose. Consequently, any,use or transfer of the funds that directly benefits private individuals should be invalidated," the high court said. "[It] is at once apparent that any property acquired by means of the coconut levy funds, such as the subject UCPB shares, should be treated as public funds or public property..." it added. — DVM, GMA News