ARNAULT VS NAZARENO

G.R. NO. L-3820

JULY 18, 1950

FACTS:
The Buenavista estate was orinally owned by San Juan de Dios Hospital in which the Phil Govt held a 25
yr lease contract with an option to purchase it for 3M. In 1946 it was sold to Ernest Burt for 5M. He only made a
downpayment of 10k. No other payment was made. On the other hand, he Tambobong estate is originally owned
by Philippine Trust Company. On May 1946 it was sold to Burt for 1.2M, but the latter only made a downpayment
of 10K.
October, 1949, the 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 PNB, from which
the money was borrowed, bought the two estates Buenavista (4.5M) and Tambobong (500K).
On February 27, 1950, the Senate adopted Resolution No. 8, which created a special committee to
investigate the transactions surrounding the estates. The special committee created by the resolution called and
examined various witnesses, among the most important of whom was Jean L. Arnault. An intriguing question
which the committee sought to resolve was 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 two checks payable to Burt aggregating P1,500,000 were delivered to him on the
afternoon of October 29, 1949; that on the same date he opened a new account in the name of Ernest H. Burt
with the Philippine National Bank in which he deposited the two checks aggregating P1,500,000; and that on the
same occasion he drew on said account two checks; one for P500,000, which he transferred to the account of the
Associated Agencies, Inc., with the Philippine National Bank, and another for P440,000 payable to cash, which he
himself cashed.
It was the desire of the committee to determine the ultimate recipient of this sum of P440,000 that gave
rise to the present case. As Arnault resisted to name the recipient of the money, 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.
A. WHAT IS THE EXTENT OF CONGRESS INQUIRY?
1. Granted by the Constitution
Section 21 Article VI 1987 Constitution: The Senate or the House of Representatives or any of it
respective committees may conduct inquiries in aid of legislation in accordance with its duly
published rules of procedure. The rights of persons appearing in or affected by such inquiries
shall be respected.
the power of inquiry is an essential and appropriate auxiliary to the legislative function. A
legislative body cannot legislate wisely of effectively in the absence of information respecting the
conditions that the legislation is intended to effect or change.
2. In aid of legislation
The inquiry must be material or necessary to the exercise of a power in it vested by the Constitution,
such as to legislate, or to expel a Member
must be material or pertinent to the subject of the inquiry or investigation.
the materiality of the question must be determined by its direct relation to any proposed or possible
legislation. Because the necessity or lack of necessity for legislative action and the form and

character of the action itself are determined by the sum total of the information to be gathered as a
result of the investigation, and not by a fraction of such information elicited from a single question.
It is not necessary for the legislative body to show that every question is propounded to a witness is
material to any proposed or possible legislation; what is required is that it be pertinent to the matter
under inquiry

B. WHAT ARE THE LIMITATIONS OF THE POWER?

Section 21 Article VI
a. It must be in aid of its legislative functions
b. It must be conducted in accordance with duly published rules of procedure
c. The persons appearing therein are afforded their constitutional rights, including the rights to be
represented by a counsel and the right against self-incrimination
C. IS IT ABSOLUTE?

The members of the Supreme Court are exempt from this power of inquiry on the basis of separation of
powers, fiscal autonomy and the constitutional independence of the judiciary
The President is beyond the reach of the congress, except though the power of impeachment

D. IS IT A POLITICAL QUESTION HENCE NOT SUBJECT TO JUDICIAL REVIEW?

No. It may be subjected to judicial review pursuant to the Supreme Courts certiorari powers
under Section 1, Article VIII of the Constitution. Since the right of Congress to conduct an inquiry in aid of
legislation is, in theory, no less susceptible to abuse than executive or judicial power.
Where the alleged immateriality of the information sought by the legislative body from a witness is
relied upon to contest its jurisdiction, the court is duty bound to pass upon the contention. The fact that
the legislative body has jurisdiction or the power to make the inquiry would not preclude judicial
intervention to correct a clear abuse of discretion in the exercise on that power.
E. LEGISLATIVE CONTEMPT
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 to his constitutional right against self-incrimination.
In Marshall v Gordon 243 U.S. 521 and Sullivan v. Hill 73 W, it was recognized that the House of
Representatives has implied power to punish a person not a member for contempt. If the subject of the
investigation before the committee is within the range of legitimate legislative inquiry and the proposed
testimony of the witness called relates to that subject, obedience to its process may be enforced by the
committee by imprisonment.

Here, the petition for Habeas Corpus of Arnault was denied. The subject matter of the
inquiry is the determination of the parties responsible for the Buenavista and Tamambong
estates deal. The question of the identity of the recipient of the P440K is the very thing sought
to be determined, and is thus a material question. By refusing to answer a material question,
Arnault can be cited for contempt by the Senate Commmittee and incarcerated.