PCGG not required to pay 6% annual interest of Palm Companies – Sandiganbayan

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In a resolution released on March 28, the Sandiganbayan recalls its order on the PCGG to pay yearly interest on the Romualdez's firms after their failure to establish entitlement to the payment

MANILA, Philippines – The Presidential Commission on Good Government (PCGG) is not required to pay the 6% annual interest on the sequestered funds from the Romualdez-owned Palm Companies.

The Palm Avenue Holding Co, Inc. and Palm Avenue Realty Development Corp. are owned by the family of late ambassador Benjamin “Kokoy” Romualdez — brother of former first lady Imelda Marcos and father of current House Speaker Martin Romualdez.

In an 8-page resolution released last Friday, March 28, the Sandiganbayan recalled its order on the PCGG to pay yearly interest on the Romualdez’ firms after the Sixth Division said they failed to establish entitlement to the payment.

“The Palm Companies are not entitled to monetary interest on the sequestered funds previously transferred to the CARP (Comprehensive Agrarian Reform Program) Fund,” the anti-graft court said in a resolution promulgated on February 6 penned by Associated Justice Sara Jane Fernandez.

“It must be emphasized that the said funds were under custody of the PCGG not because plaintiff and the Palm Companies entered into a contract for the use of the said funds. The subject funds came into the PCGG’s custody by virtue of a sequestration order.”

Associate Justices Miachel Fredrick Musngi and Kevin Narce Vivero concurred.

The PCGG, the agency in charge of recovering the Marcos family’s ill-gotten wealth, sequestered the firms in 1986. The government collected P110.8 million worth of stocks and funds from Palm Companies.

In 1989, however, the Sandiganbayan ruled the monies should not have been transferred to the CARP Fund as there was a question on its rightful ownership. The funds had already earned P4.48 million in interest before they were transferred to CARP.

Two decades later, the Palm Companies secured a court ruling stating they should get a 6% annual interest earning from the millions confiscated by the PCGG.

Government lawyers argued that the PCGG was only supposed to “conserve and preserve” what they were able to collect — meaning, the Palm Companies’ pushing for the payment of interests should have no basis since the funds were still with the Bureau of Treasury.

They also pointed out that the pending case on the rightful ownership did not create any monetary obligation on the part of the government.

However, the Palm Companies said that the PCGG should have had the P110.8 million withdrawn from the CARP Fund when the Sandiganbayan questioned the funds’ ownership. The firms also noted that it would have earned more in interest if it was left alone by the government.

In the February 2025 decision, however, Fernandez emphasized that the Palm Companies were not able to present the right to recover interest, which in the first place could only be available if there was a contract involved or if the interest were a result of damages. – Rappler.com