DIGESTED CASES ON STATUTORY CONSTRUCTION(source: INTERNET)CASES FROM NO. 21-82

21. Philippine Apparel Workers’ Union v. NLRCGR L-50320, 31 July 1981 (105 SCRA 444)First Division, Makasiar (p): 3 concurring

Facts: In anticipation of the expiration of their 1973-1976 collective bargaining agreement, the Union submitted a set of bargaining proposals to the company. Negotiations were held thereafter, but due to the impasse, the Union filed a complaint with the Department of Labor praying that the parties be assisted in concluding a collective agreement. Notwithstanding the complaint, the parties continued with negotiations. Finally, on 3 September 1977, the parties signed the agreement providing for a three-stage wage increase for all rank and file employees, retroactive to 1April 1977. Meanwhile, on 21 April 1977, Presidential Decree 1123 was enacted to take effect on 1 May 1977 providing for an increase by P60.00 in the living allowance ordained by Presidential Decree 525. This increase was implemented effective 1 May 1977 by the company. The controversy arose when the petitioner union sought the implementation of the negotiated wage increase of P0.80 as provided for in the collective bargaining agreement. The company alleges that it has opted to consider the P0.80 daily wage increase (roughly P22 per month) as partial compliance with the requirements of PD 1123, so that it is obliged to pay only the balance of P38 per month, contending that that since there was already a meeting of the minds between the parties as early as 2 April 1977 about the wage increases which were made retroactive to 1 April 1977, it fell well within the exemption provided for in the Rules Implementing PD 1123. The Union, on the other hand, maintains that the living allowance under PD 1123 (originally PD 525) is distinct from the negotiated daily wage increase of P0.80.

On 13 February 1978, the Union filed a complaint for unfair labor practice and violation of the CBA against the company. On 30 May 1978, an Order was issued by the Labor Arbiter dismissing the complaint and referred the case to the parties to resolve their disputes in accordance with the machinery established in the Collective Bargaining Agreement. From this order, both parties appealed to the Commission. On 1 September 1978, the Commission (Second Division) promulgated its decision, setting aside the order appealed from and entering a new one dismissing the case for obvious lack of merit, relying on a letter of the Undersecretary of Labor that agreement between the parties was made 2 April 1977 granting P27 per month retroactive to 1 April 1977 which was squarely under the exceptions provided for in paragraph k of the rules implementing PD 1123. The union filed for reconsideration, but the Commission en banc dismissed the same on 8 February 1979. Hence, the petition.

Issue: Whether the Commission was correct in determining the agreement falls under the exceptions.

Held: The collective bargaining agreement was entered into on 3 September1977, when PD 1123 was already in force and effect, although the increase on the first year was retroactive to 1 April 1977. There is nothing in the records that the negotiated wage increases were granted or paid before May 1977, to allow the company to fall within the exceptions provided for in paragraph k of the rules implementing PD 1123. There was neither a perfected contract nor an actual payment of said increase. There was no grant of said increases yet, despite the contrary opinion expressed in the letter of the Undersecretary of Labor. It must be noted that the letter was based on a wrong premise or representation on the part of the company. The company had declared that the parties have agreed on 2 April 1977 in recognition of the imperative need for employees to cope up with inflation brought about by, among others, another increase in oil price, but omitting the fact that negotiations were still being held on other unresolved economic and non-economic bargaining items (which were only agreed upon on 3 September 1977).

The Department of Labor had the right to construe the word “grant” as used in its rules implementing PD 1123, and its explanation regarding the exemptions to PD 1123 should be given weight; but, when it is based on misrepresentations as to the existence of an agreement between the parties, the same cannot be applied. There is no distinction between interpretation and explaining the extent and scope of the law; because where one explains the intent and scope of a statute, he is interpreting it. Thus, the construction or explanation of Labor Undersecretary is not only wrong as it was purely based on a misapprehension of facts, but also unlawful because it goes beyond the scope of the law.

The writ of certiorari was granted. The Supreme Court set aside the decision of the commission, and ordered the company to pay, in addition to the increased allowance provided for in PD 1123, the negotiated wage increase of P0.80 daily effective 1 April 1977 as well as all other wage increases embodied in the Collective Bargaining Agreement, to all covered employees; with costs against the company.

22. IBAA Employees Union v. InciongGR L52415, 23 October 1984 (132 SCRA 663)Second Division, Makasiar (p): 3 concur, 2 concur in result, 1 took no part

Facts: On June 20, 1975, the Union filed a complaint against the bank for the payment of holiday pay before the then Department of Labor, National Labor Relations Commission, Regional Office IV in Manila. Conciliation having failed, and upon the request of both parties, the case was certified for arbitration on 7 July 1975. On 25 August 1975, Labor Arbiter Ricarte T. Soriano rendered a decision in the above-entitled case, granting petitioner’s complaint for payment of holiday pay. Respondent bank did not appeal from the said decision. Instead, it complied with the order of the Labor Arbiter by paying their holiday pay up to and including January 1976.

On 16 December 1975, Presidential Decree 850 was promulgated amending, among others, the provisions of the Labor Code on the right to holiday pay. Accordingly, on 16 February 1976, by authority of Article 5 of the same Code, the Department of Labor (now Ministry of Labor) promulgated the rules and regulations for the implementation of holidays with pay. The controversial section thereof reads as “Status of employees paid by the month. — Employees who are uniformly paid by the month, irrespective of the number of working days therein, with a salary of not less than the statutory or established minimum wage shall be presumed to be paid for all days in the month whether worked or not.” On 23 April 1976, Policy Instruction 9 was issued by the then Secretary of Labor (now Minister) interpreting the above-quoted rule. The bank, by reason of the ruling laid down by the rule implementing Article 94 of the Labor Code and by Policy Instruction 9, stopped the payment of holiday pay to an its employees.

On 30 August 1976, the Union filed a motion for a writ of execution to enforce the arbiter’s decision of 25 August 1975, which the bank opposed. On 18 October 1976, the Labor Arbiter, instead of issuing a writ of execution, issued an order enjoining the bank to continue paying its

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employees their regular holiday pay. On 17 November 1976, the bank appealed from the order of the Labor Arbiter to the NLRC. On 20 June 1978, the NLRC promulgated its resolution en banc dismissing the bank’s appeal, and ordering the issuance of the proper writ of execution. On 21 February 1979, the bank filed with the Office of the Minister of Labor a motion for reconsideration/appeal with urgent prayer to stay execution. On 13 August 1979,s the NLRC issued an order directing the Chief of Research and Information of the Commission to compute the holiday pay of the IBAA employees from April 1976 to the present in accordance with the Labor Arbiter dated 25 August 1975. On 10 November 1979, the Office of the Minister of Labor, through Deputy Minister Amado G. Inciong, issued an order setting aside the resolution en banc of the NLRC dated 20 June 1978, and dismissing the case for lack of merit. Hence, the petition for certiorari charging Inciong with abuse of discretion amounting to lack or excess of jurisdiction.

Issue: Whether the Ministry of Labor is correct in determining that monthly paid employees are excluded from the benefits of holiday pay.

Held: From Article 92 of the Labor Code, as amended by Presidential Decree 850, and Article 82 of the same Code, it is clear that monthly paid employees are not excluded from the benefits of holiday pay. However, the implementing rules on holiday pay promulgated by the then Secretary of Labor excludes monthly paid employees from the said benefits by inserting, under Rule IV, Book Ill of the implementing rules, Section 2, which provides that: “employees who are uniformly paid by the month, irrespective of the number of working days therein, with a salary of not less than the statutory or established minimum wage shall be presumed to be paid for all days in the month whether worked or not.” Even if contemporaneous construction placed upon a statute by executive officers whose duty is to enforce it is given great weight by the courts, still if such construction is so erroneous, the same must be declared as null and void. So long, as the regulations relate solely to carrying into effect the provisions of the law, they are valid. Where an administrative order betrays inconsistency or repugnancy to the provisions of the Act, the mandate of the Act must prevail and must be followed. A rule is binding on the Courts so long as the procedure fixed for its promulgation is followed and its scope is within the statutory authority granted by the legislature, even if the courts are not in agreement with the policy stated therein or its innate wisdom. Further, administrative interpretation of the law is at best merely advisory, for it is the courts that finally determine what the law means.

The Supreme Court granted the petition, set aside the order of the Deputy Minister of Labor, and reinstated the 25 August 1975 decision of the Labor Arbiter Ricarte T. Soriano.

23. Chartered Bank Employees Association v. Ople (WALA)

24. Victorias Milling v. Social Security Commission (WALA)

25. Sarmiento v. Mison [GR L-79974, 17 December 1987]En Banc, Padilla (p): 8 concur

Facts: Petitioners, who are taxpayers, lawyers, members of the IBP and professors of Constitutional Law, seek to enjoin Salvador Mison from performing the functions of the Office of Commissioner of the Bureau of Customs and Guillermo Carague, as Secretary of the Department of Budget, from effecting disbursements in payment of Mison’s salaries and emoluments, on the ground that Mison’s appointment as Commissioner of the Bureau of Customs is unconstitutional by reason of its not having been confirmed by the Commission on Appointments. The respondents, on the other hand, maintain the constitutionality of Mison’s appointment without the confirmation of the Commission on Appointments.The Supreme Court held that the President has the authority to appoint Mison as Commissioner of the Bureau of Customs without submitting his nomination to the Commission on Appointments for confirmation, and thus, the latter is entitled the full authority and functions of the office and receive all the salaries and emoluments pertaining thereto. Thus, the Supreme Court dismissed the petition and the petition in intervention, without costs.

1. Standing to file suit / Prohibition as proper remedy: Procedural questions set aside due to demands of public interestBecause of the demands of public interest, including the need for stability in the public service, the Court resolved to give due course to the petition and decide, setting aside the finer procedural questions of whether prohibition is the proper remedy to test Mison’s right to the office of Commissioner of the Bureau of Customs and of whether the petitioners have a standing to bring this suit.

2. Constitutional ConstructionThe fundamental principle of constitutional construction is to give effect to the intent of the framers of the organic law and of the people adopting it. The intention to which force is to be given is that which is embodied and expressed in the constitutional provisions themselves. (Gold Creek Mining v. Rodriguez) The Court will thus construe the applicable constitutional provisions, not in accordance with how the executive or the legislative department may want them construed, but in accordance with what they say and provide.

3. President’s power to appointSection 16, Article VII of the 1987 Constitution empowers the President to appoint 4 groups of officers: (1) the heads of the executive departments, ambassadors, other public ministers and consuls, officers of the armed forces from the rank of colonel or naval captain, and other officers whose appointments are vested in him in this Constitution; (2) all other officers of the Government whose appointments are not otherwise provided for by law; (3) those whom the President may be authorized by law to appoint; and (4) officers lower in rank 4 whose appointments the Congress may by law vest in the President alone. The first group is clearly appointed with the consent of the Commission on Appointments. Appointments of such officers are initiated by nomination and, if the nomination is confirmed by the Commission on Appointments, the President appoints. The second and third groups of officers can be made by the President without the consent (confirmation) of the Commission on Appointments, as can be determined through the recorded proceedings of Constitutional Commission.

4. Express enumeration excludes others not enumeratedIt is an accepted rule in constitutional and statutory construction that an express enumeration of subjects excludes others not enumerated. In the case at bar, it would follow that only those appointments to positions expressly stated in the first group require the consent (confirmation) of the Commission on Appointments.

5. Constitutional provision presumed to have been framed and adopted in light of prior lawsA constitutional provision must be presumed to have been framed and adopted in the light and understanding of prior and existing laws and with reference to them. Courts are bound to presume that the people adopting a constitution are familiar with the previous and existing laws upon the

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subjects to which its provisions relate, and upon which they express their judgment and opinion in its adoption. In the 1935 Constitution, almost all presidential appointments required the consent (confirmation) of the Commission on Appointments. Under the 1935 Constitution, the commission was frequently transformed into a venue of “horse-trading” and similar malpractices. On the other hand, the 1973 Constitution, consistent with the authoritarian pattern in which it was molded and remolded by successive amendments, placed the absolute power of appointment in the President with hardly any check on the part of the legislature. Given the above two in extremes, one, in the 1935 Constitution and the other, in the 1973 Constitution, it is not difficult for the Court to state that the framers of the 1987 Constitution and the people adopting it, struck a “middle ground” by requiring the consent (confirmation) of the Commission on Appointments for the first group of appointments and leaving to the President, without such confirmation, the appointment of other officers, i.e., those in the second and third groups as well as those in the fourth group, i.e., officers of lower rank. The proceedings in the 1986 Constitutional Commission support this conclusion.

6. Construction of “also” in second sentence; consideration of different language of proximate sentences to determine meaningThe word “also” could mean “in addition; as well; besides, too” besides “in like manner” which meanings could stress that the word “also” in said second sentence means that the President, in addition to nominating and, with the consent of the Commission on Appointments, appointing the officers enumerated in the first sentence, can appoint (without such consent or confirmation) the officers mentioned in the second sentence, contrary to the interpretation that the President shall appoint the officers mentioned in said second sentence in the same manner as he appoints officers mentioned in the first sentence. Rather than limit the area of consideration to the possible meanings of the word “also” as used in the context of said second sentence, the Court has chosen to derive significance from the fact that the first sentence speaks of nomination by the President and appointment by the President with the consent of the Commission on Appointments, whereas, the second sentence speaks only of appointment by the President. And, this use of different language in 2 sentences proximate to each other underscores a difference in message conveyed and perceptions established. Thus, words are not pebbles in alien juxtaposition.

7. Power to appoint fundamentally executive in character; Limitations construed strictlyThe power to appoint is fundamentally executive or presidential in character. Limitations on or qualifications of such power should be strictly construed. Such limitations or qualifications must be clearly stated in order to be recognized. In the case at bar, the first sentence of Sec. 16, Art. VII clearly stated that appointments by the President to the positions therein enumerated require the consent of the Commission on Appointments.

8. The use of word “alone” after “President” in third sentence is a lapse in draftsmanship, a literal import deemed redundantAfter a careful study of the deliberations of the 1986 Constitutional Commission, the Court found the use of the word “alone” after the word “President” in said third sentence of Sec. 16, Article VII is, more than anything else, a slip or lapsus in draftmanship. In the 1987 Constitution, the clear and expressed intent of its framers was to exclude presidential appointments from confirmation by the Commission on Appointments, except appointments to offices expressly mentioned in the first sentence. Consequently, there was no reason to use in the third sentence the word “alone” after the word “President” in providing that Congress may by law vest the appointment of lower-ranked officers in the President alone, or in the courts, or in the heads of departments, because the power to appoint officers whom the President may be authorized by law to appoint is already vested in him, without need of confirmation by the Commission on Appointments, in the second sentence. The word “alone” in the third sentence, as a literal import from the last part of par. 3, section 10, Article VII of the 1935 Constitution, appears to be redundant in the light of the second sentence. This redundancy cannot prevail over the clear and positive intent of the framers of the 1987 Constitution that presidential appointments, except those mentioned in the first sentence, are not subject to confirmation by the Commission on Appointments.

9. President authorized Commissioner of Bureau of Customs; Commissioner not included with the first group of appointmentThe position of Commissioner of the Bureau of Customs (a bureau head) is not one of those within the first group of appointments where the consent of the Commission on Appointments is required. The 1987 Constitution deliberately excluded the position of “heads of bureaus” from appointments that need the consent (confirmation) of the Commission on Appointments. Moreover, the President is expressly authorized by law to appoint the Commissioner of the Bureau of Customs (RA 1937, Tarifff and Customs Code of the Philippines, Section 601, as amended by PD34 on 27 October 1972).

10. Laws approved during the effectivity of previous constitution must be read in harmony with the new oneRA 1937 and PD 34 were approved during the effectivity of the 1935 Constitution, under which the President may nominate and, with the consent of the Commission on Appointments, appoint the heads of bureaus, like the Commissioner of the Bureau of Customs. After the effectivity of the 1987 Constitution, however, RA 1937 and PD 34 have to be read in harmony with Sec. 16, Art. VII, with the result that, while the appointment of the Commissioner of the Bureau of Customs is one that devolves on the President, as an appointment he is authorized by law to make, such appointment, however, no longer needs the confirmation of the Commission on Appointments.

26. Perfecto v. Meer (WALA)

27. Endencia v. David [GR L-6355-56, 31 August 1953]En Banc, Montemayor (p): 6 concur

Facts: RA590 was enacted by Congress after the promulgation of the Court’s decision in Perfecto v. Meer. Section 13 of said act provided that “no salary wherever received by any public officer of the Republic of the Philippines shall be considered as exempt from the income tax, payment of which is hereby declared not to be a diminution of his compensation fixed by the Constitution or by law.”

This is a joint appeal from the decision of the CFI Manila declaring section 13 of RA 590 unconstitutional, and ordering Saturnino David as Collector of Internal Revenue to refund to Justice Pastor M. Endencia the sum of P1,744.45, representing the income tax collected on his salary as Associate Justice of the CA in 1951, and to Justice Fernando Jugo the amount of P2,345.46, representing the income tax collected on his salary from 1 January 1950 to 19 October 1950, as Presiding Justice of the CA, and from 20 October 1950 to 31 December 1950, as Associate Justice of the SC, without special pronouncement as to costs. The lower court, through Judge Higinio Macadaeg, held that the collection of income taxes on the salaries of the Justices was a diminution of their compensation, and ordered the refund of the taxes.

The Supreme Court affirmed the decision, affirming the ruling in Perferto v. Meer and holding the interpretation and application of laws belong to the Judiciary.

1. Collection of income tax on salaries of judicial officers a diminution or decrease

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As held in the Perfecto case, judicial officers are exempt from the payment of income tax on their salaries, because the collection thereof by the Government was a decrease or diminution of their salaries during their continuance in office, a thing which is expressly prohibited by the Constitution. O’Malley v. Woodrought does not apply.

2. Separation of powerUnder the system of constitutional government, the Legislative department is assigned the power to make and enact laws. The Executive department is charged with the execution or carrying out of the provisions of said laws. But the interpretation and application of said laws belong exclusively to the Judicial department. And this authority to interpret and apply the laws extends to the Constitution. Before the courts can determine whether a law is constitutional or not, it will have to interpret and ascertain the meaning not only of said law, but also of the pertinent portion of the Constitution in order to decide whether there is a conflict between the two, because if there is, then the law will have to give way and has to be declared invalid and unconstitutional.

3. Interpretation and application of Constitution and statutes belong to JudiciaryThe interpretation and application of the Constitution and of statutes is within the exclusive province and jurisdiction of the judicial department, and that in enacting a law, the Legislature may not legally provide therein that it be interpreted in such a way that it may not violate a Constitutional prohibition, thereby tying the hands of the courts in their task of later interpreting said statute, specially when the interpretation sought and provided in said statute runs counter to a previous interpretation already given in a case by the highest court of the land. In the case at bar, Section 13 of RA 590 interpreted or ascertained the meaning of the phrase “which shall not be diminished during their continuance in office,” found in section 9, Article VIII of the Constitution, referring to the salaries of judicial officers. This act of interpreting the Constitution or any part thereof by the Legislature is an invasion of the well-defined and established province and jurisdiction of the Judiciary. The Legislature under our form of government is assigned the task and the power to make and enact laws, but not to interpret them. This is more true with regard to the interpretation of the basic law, the Constitution, which is not within the sphere of the Legislative department. Allowing the legislature to interpret the law would bring confusion and instability in judicial processes and court decisions.

4. Exemption from tax not intended to benefit judicial officers, but grounded on public policyThe primary purpose of the prohibition against diminution was not to benefit the judges, but, like the clause in respect of tenure, to attract good and competent men to the bench and to promote that independence of action and judgment which is essential to the maintenance of the guaranties, limitations and pervading principles of the Constitution and to the administration of justice without respect to persons and with equal concern for the poor and the rich. Such being its purpose, it is to be construed, not as a private grant, but as a limitation imposed in the public interest; in other words, not restrictively, but in accord with its spirit and the principle on which it proceeds (Evans v. Gore). The independence of the judges is of far greater importance than any revenue that could come from taxing their salaries.

5. Exception in abstract not unusual nor abhorrent as long as it is base on public policy or interestConsidering exemption in the abstract, there is nothing unusual or abhorrent in it, as long as it is based on public policy or public interest. While all other citizens are subject to arrest when charged with the commission of a crime, members of the Senate and House of Representatives except in cases of treason, felony and breach of the peace are exempt from arrest, during their attendance in the session of the Legislature; and while all other citizens are generally liable for any speech, remark or statement, oral or written, tending to cause the dishonor, discredit or contempt of a natural or juridical person or to blacken the memory of one who is dead, Senators and Congressmen in making such statements during their sessions are extended immunity and exemption.

6. Other persons also provided tax exemptions; ExamplesPersons, natural and juridical, are exempt from taxes on their lands, buildings and improvements thereon when used exclusively for educational purposes, even if they derive income therefrom. (Art. VI, Sec. 22 [3].) Holders of government bonds are exempted from the payment of taxes on the income or interest they receive therefrom (sec. 29 (b) [4], National Internal Revenue Code as amended by RA 566). Payments or income received by any person residing in the Philippines under the laws of the United States administered by the United States Veterans Administration are exempt from taxation. (RA 360). Funds received by officers and enlisted men of the Philippine Army who served in the Armed Forces of the United States, allowances earned by virtue of such services corresponding to the taxable years 1942 to 1945, inclusive, are exempted from income tax. (RA 210). The payment of wages and allowances of officers and enlisted men of the Armed Forces of the Philippines sent to Korea are also exempted from taxation. (RA 815). New and necessary industries are also exempted from taxation for a certain number of years. (RA 35). For reasons of public policy and public interest, a citizen may justifiably by constitutional provision or statute be exempted from his ordinary obligation of paying taxes on his income.

28. Nitafan v. Commissioner of Internal Revenue [GR L-78780, 23 July 1987]; ResolutionEn Banc, Melencio-Herrera (p): 12 concur, 1 on leave

Facts: The Chief Justice has previously issued a directive to the Fiscal Management and Budget Office to continue the deduction of withholding taxes from salaries of the Justices of the Supreme Court and other members of the judiciary. This was affirmed by the Supreme Court en banc on 4 December 1987.

Petitioners are the duly appointed and qualified Judges presiding over Branches 52, 19 and 53, respectively, of the RTC, National Capital Judicial Region, all with stations in Manila. They seek to prohibit and/or perpetually enjoin the Commissioner of Internal Revenue and the Financial Officer of the Supreme Court, from making any deduction of withholding taxes from their salaries. With the filing of the petition, the Court deemed it best to settle the issue through judicial pronouncement, even if it had dealt with the matter administratively.

The Supreme Court dismissed the petition for prohibition.

1. Intent to delete express grant of exemption of income taxes to members of JudiciaryThe salaries of members of the Judiciary are subject to the general income tax applied to all taxpayers. This intent was somehow and inadvertently not clearly set forth in the final text of the Constitution as approved and ratified in February, 1987 (infra, pp. 7-8). Although the intent may have been obscured by the failure to include in the General Provisions a proscription against exemption of any public officer or employee, including constitutional officers, from payment of income tax, the Court since then has authorized the continuation of the deduction of the withholding tax from the salaries of the members of the Supreme Court, as well as from the salaries of all other members of the Judiciary. The Court hereby makes of record that it had then discarded the ruling in Perfecto vs. Meer and Endencia vs. David.

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The 1973 Constitution has provided that “no salary or any form of emolument of any public officer or employee, including constitutional officers, shall be exempt from payment of income tax (Section 6, Article XV)” which was not present in the 1987 Constitution. The deliberations of the 1986 Constitutional Commission relevant to Section 10, Article VIII (The salary of the Chief Justice and of the Associate Justices of the Supreme Court, and of judges of lower courts shall be fixed by law. During their continuance in office, their salary shall not be decreased), negate the contention that the intent of the framers is to revert to the original concept of “non-diminution” of salaries of judicial officers.

2. Equality of branches of government effected by modifications in provisionThe term “diminished” be changed to “decreased” and that the words “nor subjected to income tax” be deleted so as to give substance to equality among the three branches in the government. A period (.) after “decreased” was made on the understanding that the salary of justices is subject to tax. With the period, the doctrine in Perfecto vs. Meer and Endencia vs. David is understood not to apply anymore. Justices and judges are not only the citizens whose income have been reduced in accepting service in government and yet subjected to income tax. Such is true also of Cabinet members and all other employees.

3. Constitutional construction adopts the intent of the framers and people adopting the lawThe ascertainment of the intent is but in keeping with the fundamental principle of constitutional construction that the intent of the framers of the organic law and of the people adopting it should be given effect. The primary task in constitutional construction is to ascertain and thereafter assure the realization of the purpose of the framers and of the people in the adoption of the Constitution. It may also be safely assumed that the people in ratifying the Constitution were guided mainly by the explanation offered by the framers. In the case at bar, Section 10, Article VIII is plain that the Constitution authorizes Congress to pass a law fixing another rate of compensation of Justices and Judges but such rate must be higher than that which they are receiving at the time of enactment, or if lower, it would be applicable only to those appointed after its approval. It would be a strained construction to read into the provision an exemption from taxation in the light of the discussion in the Constitutional Commission.

29. Aglipay v. RuizGR 45459, 13 March 1937 (64 Phil 201)First Division, Laurel (p): 5 concur.

Facts: In May 1936, the Director of Posts announced in the dailies of Manila that he would order the issuance of postage stamps commemorating the celebration in the City of Manila of the 33rd International Eucharistic Congress, organized by the Roman Catholic Church. The petitioner, Mons. Gregorio Aglipay, Supreme Head of the Philippine Independent Church, in the fulfillment of what he considers to be a civic duty, requested Vicente Sotto, Esq., member of the Philippine Bar, to denounce the matter to the President of the Philippines. In spite of the protest of the petitioner’s attorney, the Director of Posts publicly announced having sent to the United States the designs of the postage for printing. The said stamps were actually issued and sold though the greater part thereof remained unsold. The further sale of the stamps was sought to be prevented by the petitioner.

Issue: Whether the issuance of the postage stamps was in violation of the Constitution.

Held: Religious freedom as a constitutional mandate is not inhibition of profound reverence for religion and is not a denial of its influence in human affairs. Religion as a profession of faith to an active power that binds and elevates man to his Creator is recognized. And, in so far as it instills into the minds the purest principles of morality, its influence is deeply felt and highly appreciated. When the Filipino people, in the preamble of their Constitution, implored “the aid of Divine Providence, in order to establish a government that shall embody their ideals, conserve and develop the patrimony of the nation, promote the general welfare, and secure to themselves and their posterity the blessings of independence under a regime of justice, liberty and democracy,” they thereby manifested their intense religious nature and placed unfaltering reliance upon Him who guides the destinies of men and nations. The elevating influence of religion in human society is recognized here as elsewhere.

Act 4052 contemplates no religious purpose in view. What it gives the Director of Posts is the discretionary power to determine when the issuance of special postage stamps would be “advantageous to the Government.” Of course, the phrase “advantageous to the Government” does not authorize the violation of the Constitution; i.e. to appropriate, use or apply of public money or property for the use, benefit or support of a particular sect or church. In the case at bar, the issuance of the postage stamps was not inspired by any sectarian feeling to favor a particular church or religious denominations. The stamps were not issued and sold for the benefit of the Roman Catholic Church, nor were money derived from the sale of the stamps given to that church. The purpose of the issuing of the stamps was to take advantage of an event considered of international importance to give publicity to the Philippines and its people and attract more tourists to the country. Thus, instead of showing a Catholic chalice, the stamp contained a map of the Philippines, the location of the City of Manila, and an inscription that reads “Seat XXXIII International Eucharistic Congress, Feb. 3-7, 1937.”

The Supreme Court denied the petition for a writ of prohibition, without pronouncement as to costs.

30. Manila Prince Hotel v. GSISGR 122156, 3 February 1997En banc, Bellosillo (p): 6 concur, others dissent

Facts: The Government Service Insurance System (GSIS), pursuant to the privatization program of the Philippine Government under Proclamation 50 dated 8 December 1986, decided to sell through public bidding 30% to 51% of the issued and outstanding shares of the Manila Hotel (MHC). In a close bidding held on 18 September 1995 only two bidders participated: Manila Prince Hotel Corporation, a Filipino corporation, which offered to buy 51% of the MHC or 15,300,000 shares at P41.58 per share, and Renong Berhad, a Malaysian firm, with ITT-Sheraton as its hotel operator, which bid for the same number of shares at P44.00 per share, or P2.42 more than the bid of petitioner. Pending the declaration of Renong Berhard as the winning bidder/strategic partner and the execution of the necessary contracts, the Manila Prince Hotel matched the bid price of P44.00 per share tendered by Renong Berhad in a letter to GSIS dated 28 September 1995. Manila Prince Hotel sent a manager’s check to the GSIS in a subsequent letter, but which GSIS refused to accept. On 17 October 1995, perhaps apprehensive that GSIS has

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disregarded the tender of the matching bid and that the sale of 51% of the MHC may be hastened by GSIS and consummated with Renong Berhad, Manila Prince Hotel came to the Court on prohibition and mandamus.

Issue(s):

* Whether the provisions of the Constitution, particularly Article XII Section 10, are self-executing. * Whether the 51% share is part of the national patrimony.

Held: A provision which lays down a general principle, such as those found in Article II of the 1987 Constitution, is usually not self-executing. But a provision which is complete in itself and becomes operative without the aid of supplementary or enabling legislation, or that which supplies sufficient rule by means of which the right it grants may be enjoyed or protected, is self-executing. Thus a constitutional provision is self-executing if the nature and extent of the right conferred and the liability imposed are fixed by the constitution itself, so that they can be determined by an examination and construction of its terms, and there is no language indicating that the subject is referred to the legislature for action. In self-executing constitutional provisions, the legislature may still enact legislation to facilitate the exercise of powers directly granted by the constitution, further the operation of such a provision, prescribe a practice to be used for its enforcement, provide a convenient remedy for the protection of the rights secured or the determination thereof, or place reasonable safeguards around the exercise of the right. The mere fact that legislation may supplement and add to or prescribe a penalty for the violation of a self-executing constitutional provision does not render such a provision ineffective in the absence of such legislation. The omission from a constitution of any express provision for a remedy for enforcing a right or liability is not necessarily an indication that it was not intended to be self-executing. The rule is that a self-executing provision of the constitution does not necessarily exhaust legislative power on the subject, but any legislation must be in harmony with the constitution, further the exercise of constitutional right and make it more available. Subsequent legislation however does not necessarily mean that the subject constitutional provision is not, by itself, fully enforceable. As against constitutions of the past, modern constitutions have been generally drafted upon a different principle and have often become in effect extensive codes of laws intended to operate directly upon the people in a manner similar to that of statutory enactments, and the function of constitutional conventions has evolved into one more like that of a legislative body. Hence, unless it is expressly provided that a legislative act is necessary to enforce a constitutional mandate, the presumption now is that all provisions of the constitution are self-executing. If the constitutional provisions are treated as requiring legislation instead of self-executing, the legislature would have the power to ignore and practically nullify the mandate of the fundamental law. In fine, Section 10, second paragraph, Art. XII of the 1987 Constitution is a mandatory, positive command which is complete in itself and which needs no further guidelines or implementing laws or rules for its enforcement. From its very words the provision does not require any legislation to put it in operation.

In its plain and ordinary meaning, the term patrimony pertains to heritage. When the Constitution speaks of national patrimony, it refers not only to the natural resources of the Philippines, as the Constitution could have very well used the term natural resources, but also to the cultural heritage of the Filipinos. It also refers to Filipino’s intelligence in arts, sciences and letters. In the present case, Manila Hotel has become a landmark, a living testimonial of Philippine heritage. While it was restrictively an American hotel when it first opened in 1912, a concourse for the elite, it has since then become the venue of various significant events which have shaped Philippine history. In the granting of economic rights, privileges, and concessions, especially on matters involving national patrimony, when a choice has to be made between a “qualified foreigner” and a “qualified Filipino,” the latter shall be chosen over the former.

The Supreme Court directed the GSIS, the Manila Hotel Corporation, the Committee on Privatization and the Office of the Government Corporate Counsel to cease and desist from selling 51% of the Share of the MHC to Renong Berhad, and to accept the matching bid of Manila Prince Hotel at P44 per shere and thereafter execute the necessary agreements and document to effect the sale, to issue the necessary clearances and to do such other acts and deeds as may be necessary for the purpose.

31. Tanada v. Tuvera [ GR L-63915, 24 April 1985]En Banc, Escolin (p): 1 concur, 2 concur with reservation, 1 took no part, 1 on leave

Facts: Invoking the people’s right to be informed on matters of public concern (Section 6, Article IV of the 1973 Philippine Constitution) as well as the principle that laws to be valid and enforceable must be published in the Official Gazette or otherwise effectively promulgated, petitioners seek a writ of mandamus to compel respondent public officials to publish, and or cause the publication in the Official Gazette of various presidential decrees, letters of instructions, general orders, proclamations, executive orders, letter of implementation and administrative orders.

The Supreme Court ordered the respondents to publish in the Official Gazette all unpublished presidential issuances which are of general application, and that unless so published, they shall have no binding force and effect.

1. People proper party in petition for mandamus if question is of public right and object is to enforce a public dutyWhile the general rule is that a writ of mandamus would be granted to a private individual only in those cases where he has some private or particular interest to be subserved, or some particular right to be protected, independent of that which he holds with the public at large (Severino v. Governor General), and it is for the public officers exclusively to apply for the writ when public rights are to be subserved (Mithchell vs. Boardmen), nevertheless, when the question is one of public right and the object of the mandamus is to procure the enforcement of a public duty, the people are regarded as the real party in interest and the relator at whose instigation the proceedings are instituted need not show that he has any legal or special interest in the result, it being sufficient to show that he is a citizen and as such interested in the execution of the laws.

2. Private citizen’s legal personality recognizedThe petitioner/relator is a proper party to proceedings of this character when a public right is sought to be enforced. If the petitioner/relator is not a proper party to these proceedings no other person could be, as it is not the duty of the law officer of the Government to appear and represent the people in cases of this character. In the case at bar, private citizen’s legal personality in the Severino v. Governor General apply squarely to the present petition. The Solicitor General, the government officer generally empowered to represent the people, has entered his appearance for respondents in the case.

3. Publication in the Official Gazette necessary to give public adequate noticePublication in the Official Gazette is necessary in those cases where the legislation itself does not provide for its effectivity date — for then the date of publication is material for determining its date of effectivity, which is the fifteenth day following its publication — but not when the law itself provides for the date when it goes into effect. This is correct insofar as it equates the effectivity of laws with the fact of publication. Article 2 however, considered in the light of other statutes applicable to the issue (see Section 1, CA 638), does not preclude the requirement of

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publication in the Official Gazette, even if the law itself provides for the date of its effectivity. The clear object of the such provision is to give the general public adequate notice of the various laws which are to regulate their actions and conduct as citizens. Without such notice and publication, there would be no basis for the application of the maxim “ignorantia legis non excusat.” It would be the height of injustice to punish or otherwise burden a citizen for the transgression of a law of which he had no notice whatsoever, not even a constructive one. Further, publication is necessary to apprise the public of the contents of regulations and make the said penalties binding on the persons affected thereby (Pesigan v. Angeles)

4. Publication vital as no publicity accompanies law-making process of PresidentThe publication of laws has taken so vital significance when the people have bestowed upon the President a power heretofore enjoyed solely by the legislature. While the people are kept abreast by the mass media of the debates and deliberations in the Batasan Pambansa — and for the diligent ones, ready access to the legislative records — no such publicity accompanies the law-making process of the President. Thus, without publication, the people have no means of knowing what presidential decrees have actually been promulgated, much less a definite way of informing themselves of the specific contents and texts of such decrees.

5. The word “shall” imposes an imperative dutyThe very first clause of Section 1 of CA 638 provides that there shall be published in the Official Gazette… The word “shall” used therein imposes upon an imperative duty. That duty must be enforced if the Constitutional right of the people to be informed on matters of public concern is to be given substance and reality. The law itself makes a list of what should be published in the official Gazette. In the case at bar, such listing leaves the officials with no discretion whatsoever as to what must be included or excluded from such publication.

6. Publication of presidential issuance of public nature or general applicability mandated; publication a requirement of due processThe publication of all presidential issuances “of a public nature” or “of general applicability” is mandated by law. Presidential decrees that provide for fines, forfeitures or penalties for their violation or otherwise impose a burden on the people, such as tax and revenue measures, fall within this category. Other presidential issuances which apply only to particular persons or class of persons such as administrative and executive orders need not be published on the assumption that they have been circularized to all concerned. The publication of presidential issuances “of a public nature” or “of general applicability” is a requirement of due process. It is a rule of law that before a person may be bound by law, he must first be officially and specifically informed of its contents (See Peralta v. Comelec).

7. Unpublished presidential issuance of general application have no force and effect; Effect of ruling and the concept of operative factPresidential issuances of general application, which have not been published, shall have no force and effect. The implementation/enforcement of presidential decrees prior to their publication in the Official Gazette is an operative fact, which may have consequences which cannot be justly ignored. The past cannot always be erased by a new judicial declaration that an all-inclusive statement of a principle of absolute retroactive invalidity cannot be justified.

8. Consequence of nullity cannot be ignored; Orthodox v. Modern view on unconstitutionalityIt is the theory that the Act of Congress, having been found to be unconstitutional, was not a law; that it was inoperative, conferring no rights and imposing no duties, and hence affording no basis for the challenged decree (Norton v. Shelby County; Chicago, I. & L. Ry. Co. v. Hackett). Such broad statements as to the effect of a determination of unconstitutionality must be taken with qualifications. The actual existence of a statute, prior to such a determination, is an operative fact and may have consequences which cannot justly be ignored. The past cannot always be erased by a new judicial declaration. The effect of the subsequent ruling as to invalidity may have to be considered in various aspects — with respect to particular conduct, private and official. Questions of rights claimed to have become vested, of status, of prior determinations deemed to have finality and acted upon accordingly, of public policy in the light of the nature both of the statute and of its previous application, demand examination. These questions are among the most difficult of those which have engaged the attention of courts and it is manifest from numerous decisions that an all-inclusive statement of a principle of absolute retroactive invalidity cannot be justified (Chicot County Drainage District vs. Baxter Bank).

32. Tanada v. Tuvera [ GR L-63915, 29 December 1986]Resolution En Banc, Cruz (p) : 8 concurring.

Facts: On 24 April 1985, the Court affirmed the necessity for the publication to the Official Gazette all unpublished presidential issuances which are of general application, and unless so published, they shall have no binding force and effect. Decision was concurred only by 3 judges.

Petitioners move for reconsideration / clarification of the decision on various questions. Solicitor General avers that the motion is a request for advisory opinion. February Revolution took place, which subsequently required the new Solicitor General to file a rejoinder on the issue (under Rule 3, Section 18 of the Rules of Court).

The Supreme Court declared that all laws as above defined shall immediately upon their approval, or as soon thereafter as possible, be published in full in the Official Gazette, to become effective only after 15 days from their publication, or on another date specified by the legislature, in accordance with Article 2 of the Civil Code.

1. Publication imperativeThe clause “unless it is otherwise provided,” in Article 2 of the Civil Code, refers to the date of effectivity and not to the requirement of publication itself, which cannot in any event be omitted. This clause does not mean that the legislature may make the law effective immediately upon approval, or on any other date, without its previous publication. The legislature may in its discretion provide that the usual fifteen-day period shall be shortened or extended.

2. Scope of laws requiring publicationThe term “laws” should refer to all laws and not only to those of general application, for strictly speaking all laws relate to the people in general albeit there are some that do not apply to them directly. To be valid, the law must invariably affect the public interest even if it might be directly applicable only to one individual, or some of the people only, and not to the public as a whole.Publication requirements applies to (1) all statutes, including those of local application and private laws; (2) presidential decrees and executive orders promulgated by the President in the exercise of legislative powers whenever the same are validly delegated by the legislature or directly conferred by the Constitution; (3) Administrative rules and regulations for the purpose of enforcing or implementing existing law pursuant also to

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a valid delegation; (4) Charter of a city notwithstanding that it applies to only a portion of the national territory and directly affects only the inhabitants of that place; (5) Monetary Board circulars to “fill in the details” of the Central Bank Act which that body is supposed to enforce.Publication requirements does not apply to (1) interpretative regulations and those merely internal in nature, i.e. regulating only the personnel of the administrative agency and not the public; (2) Letters of Instructions issued by administrative superiors concerning the rules or guidelines to be followed by their subordinates in the performance of their duties; and (3) instructions of Ministry heads on case studies, assignments of personnel, etc. Municipal ordinances are not covered by this rule but by the Local Government Code.

3. Publication must be fullPublication must be in full or it is no publication at all since its purpose is to inform the public of the contents of the laws. As correctly pointed out by the petitioners, the mere mention of the number of the presidential decree, the title of such decree, its whereabouts (e.g., “with Secretary Tuvera”), the supposed date of effectivity, and in a mere supplement of the Official Gazette cannot satisfy the publication requirement.

4. Medium of PublicationIt should be published in the Official Gazette and not elsewhere. Even if newspapers of general circulation could better perform the function of communicating the laws to the people as such periodicals are more easily available, have a wider readership, and come out regularly, this kind of publication is not the one required or authorized by existing law.

5. Publication essential for due processOmission of publication would offend due process insofar as it would deny the public knowledge of the laws that are supposed to govern it. it is not unlikely that persons not aware of it would be prejudiced as a result; and they would be so not because of a failure to comply with it but simply because they did not know of its existence. Publication is required, even if their enactment is “otherwise provided” or effective immediately.

6. Right to informationSection 6 of the Bill of Rights recognizes “the right of the people to information on matters of public concern,” and this certainly applies to, among others, the legislative enactments of the government.

33. Primicias v. Urdaneta [GR L-26702, 18 October 1979]First Division, de Castro (p): 8 concurring, 1 on leave, 1 did not take part.

Facts: On 13 March 1964, Ordinance 3 (Series of 1964) was enacted by the Municipal Council of Urdaneta, Pangasinan. Ordinance is patterned after and based on Section 53, 5 paragraph 4 of Act 3992, as amended (Revised Motor Vehicle Law).

On 20 June 1964, RA 4136 (Land Transportation and Traffic Code) became effective. Section 63 explicitly repealed Act 3992 (”Act Numbered thirty-nine hundred ninety-two (3992) as amended, and all laws, executive orders, ordinance, resolutions, regulations, or parts thereof in conflict with the provisions of this Act are repealed.”

On 8 February 1965, Juan Augusto B. Primicias was driving his car within Urdaneta when a member of Urdaneta’s Municipal Police asked him to stop. He was told, upon stopping, that he had violated Municipal Ordinance 3 (S. 1964), for overtaking a truck.” The policeman then asked for plaintiff’s license which he surrendered, and a temporary operator’s permit was issued to him. This incident took place about 200 meters away from a school building, at Barrio Nancamaliran, Urdaneta.

Thereafter, a criminal complaint was filed in the Municipal Court of Urdaneta against Primicias for violation of Ordinance 3 (S. 1964). Due to the institution of the criminal case, plaintiff Primicias initiated an action for the annulment of said ordinance with prayer for the issuance of preliminary injunction for the purpose of restraining defendants Municipality of Urdaneta, Mayor Perez, Police Chief Suyat, Judge Soriano and Patrolman Andrada from enforcing the ordinance. The writ was issued and Judge Soriano was enjoined from further proceeding in the criminal case.

On 29 June 1966, the CFI Lingayen held in its decision that the ordinance was null and void and had been repealed by RA 4136. The writ of preliminary injunction against Judge Soriano definite and permanent. It also restrained Perez, Suyat, and Andrada from enforcing said ordinace throughout Urdaneta, ordering them to return the plaintiff’s driver’s license, and to pay the cost of the suit.

Defendants appealed to the Supreme Court.

The Supreme Court affirmed the appealed decision.

1. Ordinance is not clear and definite in its termsWhen the Municipal Council of Urdaneta used the phrase “vehicular traffic” (Section 1, Ordinance) it “did not distinguish between passenger cars and motor vehicles and motor trucks and buses. Considering that this is a regulatory ordinance, its clearness, definiteness and certainty are all the more important so that “an average man should be able with due care, after reading it, to understand and ascertain whether he will incur a penalty for particular acts or courses of conduct.

2. Express repeal; Test of validityThe general rule is that a later law prevails over an earlier law. Contention that “a later enactment of the law relating to the same subject matter as that of an earlier statute is not sufficient to cause an implied repeal of the original law.” is erroneous. In case at bar, ordinance’s validity should be determined vis-a-vis RA 4136, the “mother statute” (not Act 3992), which was in force at the time the criminal case was brought against Primicias.

3. Requisite of a valid ordinanceAn essential requisite for a valid ordinance is, among others, that is “must not contravene . . . the statute,” 7 for it is a “fundamental principle that municipal ordinances are inferior in status and subordinate to the laws of the state.” Following this general rule, whenever there is a conflict between an ordinance and a statute, the ordinance “must give way.”

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4. Ordinance contrary to mother statute (RA 4136)The Municipal Council of Urdaneta did not make any classification of its thoroughfares, contrary to the explicit requirement laid down by Section 38, RA 4136. The Ordinance refers to only one of the four classifications mentioned in paragraph (b), Section 35. The classifications which must be based on Section 35 are necessary in view of Section 36 which states that “no provincial, city or municipal authority shall enact or enforce any ordinance or resolution specifying maximum allowable speeds other than those provided in this Act.”

5. Delegation of powerA local legislative body intending to control traffic in public highways is supposed to classify, first, and then mark them with proper signs, all to be approved by the Land Transportation Commissioner. Statutes which confer upon a public body or officer .. power to perform acts which concern the public interests or rights of individuals, are generally regarded as mandatory although the language is permissive only since they are construed as imposing duties rather than conferring privileges. Ordinance is invalid as there is no showing that the marking of the streets and areas falling under Section 1, par. (a), Ordinance No. 3, Series of 1964, was done with the approval of the Land Transportation Commissioner.

6. Writ of injunction to restrain the proceedings of a criminal case; allowed in exceptionsThe general rule is that “ordinarily, criminal prosecution may not be blocked by court prohibition or injunction.” Exceptions are allowed in the instances (1) for the orderly administration of justice; (2) to prevent the use of the strong arm of the law in an appressive and vindictive manner; (3) to avoid multiplicity of actions; (4) to afford adequate protection to constitutional rights; (5) in proper cases, because the statute relied upon is unconstitutional or was held invalid. Injunction has frequently been sustained in order to prevent a multiplicity of prosecutions under it.

34. La Carlota Sugar Central v. Jimenez [GR L-12436, 31 May 1961]En Banc, Dizon (p): 10 concurring, 1 took no part.

Facts: Sometime in September, 1955 La Carlota Sugar Central, a domestic corporation under the administration of Elizalde & Co., Inc., imported 500 short tons of ammonium sulphate and 350 short tons of ammonium phosphate. The corresponding letter of credit in the sum of US $60,930.00, was opened through the Hongkong & Shanghai Banking Corporation in the name of the Central and in favor of the Overseas Central Enterprises, Inc. of California USA. The invoices, bill of lading, and all other papers incident to said importation were also in the name of the Central.

When the fertilizers arrived in the Philippines, the Central Bank imposed 17% exchange tax from the Central in accordance with the provisions of RA 601, as amended, and the Central paid in that connection the total sum of P20,872.09.

On 18 November 1955 the Central filed, through the Hongkong & Shanghai Banking Corporation, a petition for the refund of the P20,872.09 paid as above stated, claiming that it had imported the fertilizers mentioned heretofore upon request and for the exclusive use of five haciendas known as “Esperanza”, “Nahalin”, “Valencia” (the three owned by Elizalde), “Consuelo” and Maayon”, (the last two managed by the same company), and therefore the importation was exempt from the 17% exchange tax in accordance with Section 2, RA 601, as amended by RA 1375.

On 2 July 1956, the Auditor of the Central Bank denied the petition. The Central requested the Auditor to reconsider his ruling, but after a re-examination of all pertinent papers the reconsideration was denied. The Central then appealed to the Auditor General of the Philippines.

On 18 January 1957, the Auditor General affirmed the ruling of the Auditor of the Central Bank upon the ground that the importation of the fertilizers does not fall within the scope of the exempting provisions of Section 2 of RA 601, as amended by RA 1375; and thus affirming the decision of the Auditor, Central Bank of the Philippines.The Central and Elizalde filed the petition for review in the Supreme Court.

The Supreme Court affirmed the appealed decision. With Costs.

1. Exempting provision in tax law liberally construed against state, strictly against taxpayerWhen the issue is whether or not the exemption from a tax imposed by law is applicable, the rule is that the exempting provision is to be construed liberally in favor of the taxing authority and strictly against exemption from tax liability, the result being that statutory provisions for the refund of taxes are strictly construed in favor of the State and against the taxpayer (82 C.J.S. pp. 957-958; Helvering vs. Northwest Steel Rolling Mills, 311 US 46, 85 L. ed. 29 S. Ct., 51 Am. Jur. p. 526). Exempting from the 17% tax all fertilizers imported by planters or farmers through any agent other than their cooperatives, we would be rendering useless the only exception expressly established in the case of fertilizers imported by planters or farmers through their cooperatives.

2. “Directly” means “without anything intervening”The exemption covers exclusively fertilizers imported by planters or farmers directly or through their cooperatives. The word “directly” has been interpreted to mean “without anything intervening” (Words and Phrases, Vol. 12A, p. 140 — citing Gulf Atlantic Warehouse, etc. vs. Bennet, 51 So 2nd 544, 546, 36 Ala. App. 33); “proximately or without intervening agency or person” (Idem, p. 142 — citing Employers’ Casualty Co vs. Underwood, 286 p. 7, 10; 142 Okl. 208). Consequently, an importation of fertilizers made by a farmer or planter through an agent, other than his cooperative, is not imported directly as required by the exemption. Contention that Central is an agent of the haciendas (owned and managed by Elizalde) is, thus, without merit.

3. Importation of fertilizers not covered by exemptionThe law is clear that imported fertilizers are exempt from the payment of the 17% tax only if the same were imported by planters or farmers directly or through their cooperatives. Central “is not the planter ultimately benefited by the fertilizers, much less a cooperative within the purview of RA 601, as amended.

4. Act as agent without intent of profit immaterialConsidering the language employed in the statute, the contention that the agent acted simply to accommodate the planter or farmer and without any idea of making any profit from the transaction would seem to be immaterial.

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35. CIR v. CA [GR 115349, 18 April 1997]Third Division, Panganiban (p): 4 concurring.

Facts: Private respondent, Ateneo de Manila University, is a non-stock, non-profit educational institution with auxiliary units and branches all over the country. The Institute of Philippine Culture (IPC) is an auxiliary unit with no legal personality separate and distinct from private respondent. The IPC is a Philippine unit engaged in social science studies of Philippine society and culture. Occasionally, it accepts sponsorships for its research activities from international organizations, private foundations and government agencies. On 8 July 1983, private respondent received from CIR a demand letter dated 3 June 1983, assessing private respondent the sum of P174,043.97 for alleged deficiency contractor’s tax, and an assessment dated 27 June 1983 in the sum of P1,141,837 for alleged deficiency income tax, both for the fiscal year ended 31 March 1978. Denying said tax liabilities, private respondent sent petitioner a letter-protest and subsequently filed with the latter a memorandum contesting the validity of the assessments. On 17 March 988, petitioner rendered a letter-decision canceling the assessment for deficiency income tax but modifying the assessment for deficiency contractor’s tax by increasing the amount due to P193,475.55. Unsatisfied, private respondent requested for a reconsideration or reinvestigation of the modified assessment. At the same time, it filed in the respondent court a petition for review of the said letter-decision of the petitioner. While the petition was pending before the respondent court, petitioner issued a final decision dated 3 August 1988 reducing the assessment for deficiency contractor’s tax from P193,475.55 to P46,516.41, exclusive of surcharge and interest.

On 12 July 1993, the respondent court set aside respondent’s decision, and canceling the deficiency contractor’s tax assessment in the amount of P46,516.41 exclusive of surcharge and interest for the fiscal year ended 31 March 1978. No pronouncement as to cost.

On 27 April 1994, Court of Appeals, in CA-GR SP 31790, affirmed the decision of the Court of Tax Appeals. Not in accord with said decision, petitioner came to Supreme Court via a petition for review.

The Supreme Court denied the petition and affirmed the assailed Decision of the Court of Appeals. The Court ruled that the private respondent is not a contractor selling its services for a fee but an academic institution conducting these researches pursuant to its commitments to education and, ultimately, to public service. For the institute to have tenaciously continued operating for so long despite its accumulation of significant losses, we can only agree with both the Court of Tax Appeals and the Court of Appeals that “education and not profit is motive for undertaking the research projects.

1. Application of Doctrine of strict implementation before Principle of tax exemptionCIR erred in applying the principles of tax exemption without first applying the well-settled doctrine of strict interpretation in the imposition of taxes. It is obviously both illogical and impractical to determine who are exempted without first determining who are covered by the aforesaid provision. The Commissioner should have determined first if private respondent was covered by Section 205, applying the rule of strict interpretation of laws imposing taxes and other burdens on the populace, before asking Ateneo to prove its exemption therefrom, following the rule of construction where “the tax exemptions are to be strictly construed against the taxpayer”.

2. Doctrine of interpretation of tax lawsThe doctrine in the interpretation of tax laws is that “(a) statute will not be construed as imposing a tax unless it does so clearly, expressly, and unambiguously. . . . (A) tax cannot be imposed without clear and express words for that purpose. Accordingly, the general rule of requiring adherence to the letter in construing statutes applies with peculiar strictness to tax laws and the provisions of a taxing act are not to be extended by implication.” In case of doubt, such statutes are to be construed most strongly against the government and in favor of the subjects or citizens because burdens are not to be imposed nor presumed to be imposed beyond what statutes expressly and clearly import.Ateneo’s Institute of Philippine Culture never sold its services for a fee to anyone or was ever engaged in a business apart from and independently of the academic purposes of the university. Funds received by the Ateneo de Manila University are technically not a fee. They may however fall as gifts or donations which are “tax-exempt” as shown by private respondent’s compliance with the requirement of Section 123 of the National Internal Revenue Code providing for the exemption of such gifts to an educational institution.

3. Meaning of “independent contractors”The term ‘independent contractors’ include persons (juridical or natural) not enumerated as excepted (but not including individuals subject to the occupation tax under Section 12 of the Local Tax Code) whose activity consists essentially of the sale of all kinds of services for a fee regardless of whether or not the performance of the service calls for the exercise or use of the physical or mental faculties of such contractors or their employees.The term ‘independent contractor’ does not include regional or area headquarters established in the Philippines by multinational corporations, including their alien executives, and which headquarters do not earn or derive income from the Philippines and which act as supervisory, communications and coordinating centers for their affiliates, subsidiaries or branches in the Asia-Pacific Region.

4. Meaning of “gross receipts”The term ‘gross receipts’ means all amounts received by the prime or principal contractor as the total contract price, undiminished by amount paid to the subcontractor, shall be excluded from the taxable gross receipts of the subcontractor.

5. Transaction of IPC not a contract of sale nor a contract for a piece of workThe transactions of Ateneo’s Institute of Philippine Culture cannot be deemed either as a contract of sale or a contract for a piece of work. By the contract of sale, one of the contracting parties obligates himself to transfer the ownership of and to deliver a determinate thing, and the other to pay therefor a price certain in money or its equivalent. In the case of a contract for a piece of work, “the contractor binds himself to execute a piece of work for the employer, in consideration of a certain price or compensation. . . . If the contractor agrees to produce the work from materials furnished by him, he shall deliver the thing produced to the employer and transfer dominion over the thing. . . .” In the case at bench, it is clear from the evidence on record that there was no sale either of objects or services because, as adverted to earlier, there was no transfer of ownership over the research data obtained or the results of research projects undertaken by the Institute of Philippine Culture.

6. Jurisdiction of Court of Tax Appeals in reviewing tax casesThe Court of Tax Appeals is a highly specialized body specifically created for the purpose of reviewing tax cases. Through its expertise, it is undeniably competent to determine the issue of whether the Ateneo may be deemed a subject of the three percent contractor’s tax through the evidence presented before it. Consequently, “as a matter of principle, the Supreme Court will not set aside the conclusion reached by . . . the Court of Tax Appeals which is, by the very nature of its function, dedicated exclusively to the study and consideration of tax problems and has necessarily developed an expertise on the subject unless there has been an abuse or improvident exercise of authority.

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36. Mactan Cebu (MCIAA) v. Marcos (WALA)

37. Serfino v. CA [GR L-40858, 15 September 1987]also PNB v. CA [GR L-40751]Second Division, Paras (J): 4 concur

Facts: On 25 August 1937, a parcel of land consisting of 21.1676 hectares situated in the Municipality of Sagay, Province of Negros Occidental, was patented in the name of Pacifico Casamayor, under Homestead Patent 44139. Upon registration of said patent in the office of the Register of Deeds of Negros Occidental, OCT No. 1839 was issued by said office in the name of Pacifico Casamayor. On 14 December 1945, the latter sold said land in favor of Nemesia D. Baltazar. OCT 1839 was lost during the war and upon petition of Nemesia Baltazar, CFI Negros Occidental ordered the reconstitution thereof. Pursuant thereto, OCT 14-R (1839) was issued on 18 January 1946 in the name of Pacifico Casamayor. On that same day, TCT 57-N was issued in the name of Nemesia Baltazar but after the cancellation of OCT 14-R (1839). On 25 August 1951, Nemesia Baltazar, sold said property to Lopez Sugar Central Mill Co., Inc. (Lopez Sugar Central). The latter, however did not present the documents for registration until 17 December 1964 to the Office of the Registry of Deeds; said office refused registration upon its discovery that the same property was covered by another certificate of title, TCT 38985, in the name of Federico Serfino. An inquiry into this discrepancy reveals that the Provincial Treasurer of Negros Occidental on 30 October 1956 had conducted a public auction sale of this property for tax delinquency for the period starting the year 1950. Notice of this public auction sale was sent to Pacifico Casamayor but none to Nemesia Baltazar and Lopez Sugar Mill. There being no public bidders on the scheduled date of sale, the Provincial Treasurer of Negros Occidental issued a Certification of Sale of Delinquent Real Property over the disputed land to the Province of Negros Occidental. On 14 May 1964, upon payment of the amount of P1,838.49 by Federico Serfino, a Certificate of Repurchase of Real Property was issued and executed by the Provincial Treasurer in favor of Federico Serfino, for and in behalf of Pacifico Casamayor.

On 28 May 1964, Serfino filed a petition with CFI Negros Occidental for the Reconstitution of OCT 1839 in the name of Pacifico Casamayor, upon the allegation that said title was lost. After due publication and hearing, said OCT was ordered reconstituted and thus OCT RP-1304 (1839) was issued by the Registry of Deeds in the name of Casamayor. On 30 October 1964, Serfino petitioned the court for confirmation of his title to the land as purchaser in the auction sale. On 31 October 1964, court granted the petition and on 2 November 1964, OCT RP-1304 (1839) was cancelled and TCT 38985 was issued in the name of Federico Serfino, married to Lorna Bachar. On 19 November 1964, the spouses Serfinos mortgaged the land to the Philippine National Bank (PNB) to secure a loan in the amount of P5,000.00. Said mortgage in favor of PNB was inscribed in TCT 38985. Hence, this was the situation of the land when the Office of the Register of Deeds refused registration of the property in question requested by the Lopez Sugar Central.

On 16 January 1965 in the Petition of the Office of the Register of Deeds seeking the cancellation of either TCT 57-N (Nemesia Baltazar) or TCT 38985 (Lopez Sugar Central), the lower court in its Order ordered Lopez Sugar Central and spouses Serfino to take the necessary steps towards the clearing of their respective titles before a court of general jurisdiction. Pursuant thereto, Lopez Sugar Central, on 5 May 1965, instituted an action for (1) annulment of OCT RP-1304 (1839), of TCT 38985 and of the mortgage executed by the Serfinos in favor of PNB, (2) for the registration of the Deed of Sale, (3) for the issuance of a TCT in its name and (4) for recovery of possession of the disputed land from the Serfinos. On 4 February 1966, the lower court rendered its decision (1) ordering the Register of Deeds of Negros Occidental to cancel TCT 38985, and to register the dead of sale executed by Nemesia Baltazar on 25 August 1951, and after canceling TCT 57-N and other titles issued prior thereto, issue a TCT in the name of Lopez Sugar Central Mill Co; (2) ordering the Lopez Sugar Central to pay PNB Bacolod the sum of P5,261.11 secured by real estate mortgage registered and annotated on TT 38985 carried over to the new TCT issued to Lopez Sugar Mill with right to recourse to the Assurance Fund; (3) ordering Seferino to vacate the land and deliver the possession to Lopez Sugar Central. The lower court exempted Lopez Sugar Central from reimbursing Seferino the sum of P602.94 the latter paid for the repurchase of land as the former is already burdened with the mortgage indebtedness with the PNB. No award for damages and costs.

Both parties appealed from this decision of the trial court. Ruling on the assignment of errors, the appellate court affirmed the judgment of the trial court with modification in its decision, rendering the mortgage executed by Serfino in favor of PNB as null and void, and ordering the Central to reimburse the Serfino spouses the sum of P1,839.49 when they repurchased the property from the province of Negros Occidental for the purpose of equity,

The spouses Serfino and the PNB appealed to the Supreme Court by way of certiorari.

The Supreme Court affirmed the assailed decision, with modification that PNB mortgage credit must be paid by Lopez Sugar Central.

1. Strict compliance of prescribed procedure auction salesThe assailed decision of the appellate court declares that the prescribed procedure in auction sales of property for tax delinquency being in derogation of property rights should be followed punctiliously. Strict adherence to the statutes governing tax sales is imperative not only for the protection of the tax payers, but also to allay any possible suspicion of collusion between the buyer and the public officials called upon to enforce such laws. Notice of sale to the delinquent land owners and to the public in general is an essential and indispensable requirement of law, the non-fulfillment of which vitiates the sale.

Lopez Sugar Central was not entirely negligent in its payment of land taxes. The record shows that taxes were paid for the years 1950 to 1953 and a receipt therefor was obtained in its name. The sale therefore by the Province of Negros Occidental of the land in dispute to the spouses Serfinos was void since the Province of Negros Occidental was not the real owner of the property thus sold. In turn, the spouses Serfinos title which has been derived from that of the Province of Negros Occidental is likewise void.

2. Void auction sale does not affect claim of mortgagee in good faithThe fact that the public auction sale of the disputed property was not valid (for lack of notice of the auction sale to the actual owner) can not in any way be attributed to the mortgagee’s (PNB’s) fault. The fact remains that in spite of the lack of notice to the actual registered owner at that time (who was Nemesia Baltazar) the Register of Deeds issued a TCT in the name of Federico Serfino married to Lorna Bachar which title was relied upon PNB. The inability of the Register of Deeds to notify the actual owner or Lopez Sugar Central of the scheduled public auction sale was partly due to the failure of Lopez Sugar Central to declare the land in its name for a number of years and to pay the complete taxes thereon. PNB is therefore entitled to the payment of the mortgage loan as ruled by the trial court and exempted from the payment of costs.

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3. Corporation not barred from owning landThe original grantee was Pacifico Casamayor, who obtained a Homestead Patent and later an original certificate of title in his name. Later it was this original grantee who sold the land in question to Nemesia Baltazar on 14 December 1945 or more than eight (8) years after he obtained his homestead patent on 25 August 1937. Section 118 of CA 141, which prohibits the alienation of homestead lots to private individual within five (5) years from the date of the issuance of the patent, should apply and not Section 121, which governs sale to corporation. Since the grant was more than five (5) years before, the transfer to Nemesia Baltazar was valid and legal. Nemesia Baltazar who became the titled or registered owner as evidenced by TCT 57-N, could exercise acts of ownership over the land such as disposing of it to private respondent by a deed of sale. Private respondent, a corporation, is not barred anymore from owning land granted.

38. Manahan v. ECC [GR L-44899, 22 April 1981]First Division, Fernandez (p): 4 concurring.

Facts: Maria E. Manahan, the petitioner, is the widow of Nazario Manahan, Jr., who died of “Enteric Fever” while employed as classroom teacher in Las Piñas Municipal High School, Las Piñas, Rizal, on 8 May, 1975. The deceased was in perfect health when he entered government service on 20 July 1969, and that in the course of his employment in 1974, he was treated for epigastric pain. He succumbed to enteric fever on May 8, 1975.

The petitioner filed a claim with the GSIS for death benefit under PD 626. In a letter dated 19 June 1975, the Government Service Insurance System denied the claim on a finding that the ailment of Nazario Manahan, Jr., typhoid fever, is not an occupational disease. The petitioner filed a motion for reconsideration on the ground that ailment of said deceased was attributable to his employment. The GSIS affirmed the denial of the claim on the ground that enteric fever or paratyphoid is similar in effect to typhoid fever, in the sense that both are produced by Salmonella organisms. Source of infection in enteric fever is feces or urine from patients and carriers; organism enter the body through the gastrointestinal tract, invading the bloodstream through the lymphatic channels. Enteric fever is referred to as typhoid fever or paratyphoid fever; wherein epigastric pain is a symptom of ulcer, and ulcer is a common complication of typhoid fever.

The petitioner appealed to the ECC, which affirmed the decision of the GSIS (in ECC Case 0070, “Maria Manahan v. GSIS) on a finding that the ailment of the deceased, enteric fever, was not induced by or aggravated by the nature of the duties of Nazario Manahan, Jr. as a teacher. Thus, the appeal.

The Supreme Court set aside the decision of the ECC and ordered the GSIS to pay the petitioner the amount of P6,000.00 as death compensation benefit and P600.00 as attorney’s fees, to reimburse the petitioner’s expenses incurred for medical services, hospitalization and medicines of the deceased Nazario Manahan, Jr., duly supported by proper receipts, and to pay administrative fees.

1. In case of doubt, social legislation should be liberally construed and resolve in favor of the workerIn any case, and case of doubt, the same should be resolved in favor of the worker, and that social legislations — like the Workmen’s Compensation Act and the Labor Code — should be liberally construed to attain their laudable objective, i.e., to give relief to the workman and/or his dependents in the event that the former should die or sustain an injury. Pursuant to such doctrine and applying now the provisions of the Workmen’s Compensation Act in this case, the presumption of compensability subsists in favor of the claimant.

2. Claims accruing prior to effectivity of the Labor CodeArticle 294, Title III (Transitory and Final Provisions) of the New Labor Code provides that all actions and claims accruing prior to the effectivity of this Code shall be determined in accordance with the laws in force at the time of their accrual and under the third paragraph of Article 292, Title II (Prescription of Offenses and Claims), workmen’s compensation claims accruing prior to the effectivity of this Code and during the period from 1 November 1974 up to 31 December 1974 shall be processed and adjudicated in accordance with the laws and rules at the time their causes of action accrued Hence, this Court applied the provisions of the Workmen’s Compensation Act, as amended, on passing upon petitioner’s claim. (Corales vs. ECC, L-44063, 27 February, 1979) The illness that claimed the life of the deceased may had its onset before 10 December 1974, thus, his action accrued before 10 December 1974.

3. Social justice and labor protection warrants second look at evidenceThe constitutional guarantee of social justice and protection to labor make the court take a second look at the evidence presented by the claimant. In the case at bar, as a teacher of the Las Piñas Municipal High School, the deceased used to eat his meals at the school canteen. He also used the toilet and other facilities of the school. It was not improbable that the deceased might have contracted the illness during those rare moments that he was away from his family, since it is medically accepted that enteric fever is caused by ’salmonella’ organisms which are acquired by ingestion of contaminated food or drinks. This lead to the conclusion that the risk of contracting the fatal illness was increased by the decedent’s working condition.

39. Villavert v. ECC (WALA)

40. Del Rosario & Sons v. NLRC [GR L-64204, 31 May 1985]First Division, Melencio-Herrera (J): 5 concurring, 1 on leave

Facts: On 1 February 1978, Del Rosario & Sons Logging Enterprises, Inc. entered into a “Contract of Services” with Calmar Security Agency (Security Agency, for short) whereby the latter undertook to supply the former with security guards at the rate of P300.00 per month for each guard.

On 4 October 1979, Paulino Mabuti, Napoleo Borata and Silvino Tudio filed a Complaint against the Security Agency and petitioner, for underpayment of salary, non-payment of living allowance, and 13th month pay. Thereafter, five other guards filed their complaint for the same causes of action.

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On 21 December 1979, the Labor Arbiter, being assigned for compulsory arbitration, rendered a Decision (in ROX Arbitration Case 445-79: “Paulino Mabuti, et al. v. Calmar Security Agency, et al.”) dismissing the complaint against petitioner for want of employer-employee relationship but ordering the Security Agency to pay complainants the amounts sought by them totalling P2923.17.

The Security Agency appealed to the NLRC, which modified the Labor Arbiter’s decision by holding Del Rosario & Sons liable to pay complainants, jointly and severally, with the Security Agency on the ground that petitioner is an indirect employer pursuant to Articles 106 and 107 of the Labor Code, as amended. Reconsideration sought by petitioner having been denied.

Petitioner instituted petition for Certiorari petition contending that the NLRC erred in giving due course to the appeal despite the fact that it was not under oath and the required appeal fee was not paid; in holding it jointly and severally liable with the Security Agency; and in refusing to give due course to its Motion for Reconsideration.

The Supreme Court affirmed the judgment under review, without prejudice to petitioner’s right to seek reimbursement from Calmar Security Agency for such amounts as petitioner may have to pay to complainants. Costs against the private respondent.

1. Rules of evidence in Courts of Law not controlling in NLRCArticle 221 of the Labor Code “in any proceeding before the Commission or any of the Labor Arbiters, the rules of evidence prevailing in Courts of law or equity shall not be controlling and it is the spirit and intention of this Code that the Commission and its members and the Labor Arbiters shall use every and all reasonable means to ascertain the facts in each case speedily and objectively and without regard to technicalities of law or procedure, all in the interest of due process.”

2. Petitioner an indirect employer; liable jointly and severally with Security AgencyArticles 106 of the Labor Code provides that “in the event that the contractor or subcontractor fails to pay the wages of his employees in accordance with this Code, the employer shall be jointly and severally liable with his contractor or subcontractor to such employees to the extent of the work performed under the contract, in the same manner and extent that he is liable to employees directly employed by him,” and Article 107 provides that “the provisions of the immediately preceding Article shall likewise apply to any person, partnership, association or corporation which, not being an employer, contracts with an independent contractor for the performance of any work, task, job or project.” In the case at bar, petitioner became an indirect employer of respondents-complainants when petitioner entered into a Contract of Services with the Security Agency and the latter hired the complainants to work as guards for the former. However, the petitioner’s liability should be without prejudice to a claim for reimbursement against the Security Agency for such amounts as petitioner may have to pay to complainants. The Security Agency may not seek exculpation by claiming that petitioner’s payments to it were inadequate. As an employer, it is charged with knowledge of labor laws and the adequacy of the compensation that it demands for contractual services is its principal concern and not any other’s.

3. Lack of verification and delayed payment of appeal fee not fatal defectsThe lack of verification could have been easily corrected by requiring an oath. The appeal fee had been paid although it was delayed. Failure to pay the docketing fees does not automatically result in the dismissal of the appeal. Dismissal is discretionary with the Appellate Court (Nawasa vs. Secretary of Public Works and Communications, 16 SCRA 536, 539 [1966]), and discretion must be exercised wisely and prudently, never capriciously, with a view to substantial justice (Cucio vs. Court of Appeals, 57 SCRA 401 [1974]). [Panes vs. Court of Appeals, et al.] The broader interests of justice and the desired objective of resolving controversies on the merits demanded that the appeal be given course by the NLRC [unlike in Acda v. Mole, 119 SCRA 306 [1982], where payment of the appeal fee is “by no means a mere technicality but is an essential requirement in the perfection of an appeal.”]

41. Ty v. First National Surety [GR L-16138, 29 April 1961]also Ty v. Associated Insurance; v. United Insurance; v. Philippine Surety; v. Reliance Surety; v. Far Eastern Surety [GR 13139, 13140, 13141, 13142, 13143 respectively]Ty v. Capital Insurance [GR 16144, and GR 16145]En Banc, Labrador (p): 8 concurring

Facts: At different times within a period of two months prior to 24 December 1953, Diosdado C. Ty, employed as operator mechanic foreman in the Broadway Cotton Factory insured himself in 18 local insurance companies, among which being the 8 above-named defendants, which issued to him personal accident policies. Plaintiff’s beneficiary was his employer, Broadway Cotton Factory, which paid the insurance premiums. On 24 December 1953, a fire broke out which totally destroyed the Broadway Cotton Factory. Fighting his way out of the factory, plaintiff was injured on the left hand by a heavy object. He was brought to the Manila Central University hospital, and after receiving first-aid, he went to the National Orthopedic Hospital for treatment of his injuries (fractures in index, middle, fourth, and fifth fingers of left hand). From 26 December 1953 to 8 February 1954, he underwent medical treatment in the hospital. The above-described physical injuries have caused temporary total disability of plaintiff’s left hand. Plaintiff filed the corresponding notice of accident and notice of claim with all of the above-named defendants to recover indemnity. Defendants rejected plaintiff’s claim for indemnity for the reason that there being no severance of amputation of the left hand, the disability suffered by him was not covered by his policy.

Plaintiff sued the defendants in the Municipality Court of this City, which dismissed his complaints. Thereafter, the plaintiff appealed to the CFI Manila, presided by Judge Gregorio S. Narvasa, which absolved the defendants from the complaints. Hence, the appeal.

The Supreme Court affirmed the appealed decision, with costs against the plaintiff-appellant.

1. Agreement in insurance policies is the law between the parties; Stipulations clearThe agreement contained in the insurance policies is the law between the parties. As the terms of the policies are clear, express and specific that only amputation of the left hand should be considered as a loss thereof, an interpretation that would include the mere fracture or other temporary disability not covered by the policies would certainly be unwarranted. In the case at bar, due to the clarity of the stipulation, distinction between “temporary disability” and “total disability” need not be made in relation to one’s occupation means that the condition of the insurance is such that common prudence requires him to desist from transacting his business or renders him incapable of working (46 C.J.S., 970).

2. Court cannot go beyond express condition of insurance policies

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While the Court sympathizes with the plaintiff or his employer, for whose benefit the policies were issued, it can not go beyond the clear and express conditions of the insurance policies, all of which define partial disability as loss of either hand by a amputation through the bones of the wrist.” There was no such amputation in the case at bar.

42. De la Cruz v. Capital Insurance [GR L-21574, 30 June 1966]En Banc, Barrera (J): 8 concurring

Facts: Eduardo de la Cruz was the holder of an accident insurance policy (ITO-BFE-170) underwritten by the Capital Insurance & Surety Co., Inc., for the period beginning 13 November 1956 to 12 November 1957.

On 1 January 1957, the Itogon-Suyoc Mines, Inc. sponsored a boxing contest for general entertainment wherein the insured Eduardo de la Cruz, a non- professional boxer, participated. In the course of his bout with another person, likewise a non-professional, of the same height, weight, and size, Eduardo slipped and was hit by his opponent on the left part of the back of the head, causing Eduardo to fall, with his head hitting the rope of the ring. He was brought to the Baguio General Hospital unconscious, where the insured expired on the following day. The cause of death was reported as hemorrhage, intracranial, left.

Simon de la Cruz, the father of the insured and beneficiary under the policy, filed a claim with the insurance company for payment of indemnity under the insurance policy.

Denied, De la Cruz instituted the action in the CFI Pangasinan (Civ. Case No. U-265)) for specific performance. Defendant insurer set up the defense that the death of the insured, caused by his participation in a boxing contest, was not accidental and, therefore, not covered by insurance.

After due hearing, the court rendered the decision in favor of the plaintiff; ordering the insurance company to indemnify plaintiff for the death of the latter’s son, to pay the burial expenses, and attorney’s fees.The Supreme Court affirmed the appealed decision, with costs against appellant.

1. Construction of terms “accident” and “accidental, as used in insurance contractsThe terms “accident” and “accidental” have not acquired any technical meaning, and are construed by the courts in their ordinary and common acceptation. The terms mean that which happen by chance or fortuitously, without intention and design, and which is unexpected, unusual, and unforeseen. An accident is an event that takes place without one’s foresight or expectation: an event that proceeds from an unknown cause, or is an unusual effect of a known cause and, therefore, not expected.

2. Non-distinction of “Accidental” and “Accidental means”Tendency of court decisions in the United States in the recent years is to eliminate the fine distinction between the terms “accidental” and “accidental means” and to consider them as legally synonymous. Death or injury does not result from accident or accidental means within the terms of an accident-policy if it is the natural result of the insured’s voluntary act, unaccompanied by anything unforeseen except the death or injury. There is no accident when a deliberate act is performed unless some additional, unexpected, independent, and unforeseen happening occurs which produces or brings about the result of injury or death. Where the death or injury is not the natural or probable result of the insured’s voluntary act, which produces the injury, the resulting death is within the protection of policies insuring against the death or injury from accident. In the case at bar, while the participation of the insured in the boxing contest is voluntary, if without the unintentional slipping of the deceased, perhaps he could not have received that blow in the head and would not have died.

3. Clear stipulation, Boxing not included in exclusionsDeath or disablement resulting from engagement in boxing contests was not declared outside of the protection of the insurance contract (Death or disablement consequent upon the Insured engaging in football, hunting, pigsticking, steeplechasing, polo-playing, racing of any kind, mountaineering, or motorcycling”). Failure of the defendant insurance company to include death resulting from a boxing match or other sports among the prohibitive risks leads inevitably to the conclusion that it did not intend to limit or exempt itself from liability for such death.

43. Qua Chee Gan v. Law Union and Rock Insurance (WALA)

44. Home Insurance v. Eastern Shipping Lines (WALA)

45. Co v. Republic [GR L-12150, 26 May 1960]First Dvision, Bautista Angelo (J): 6 concur

Facts: On 13 March 1931 in Bangued, Abra, of Chinese parents. He owes his allegiance to the Nationalist Government of China. He is married to Leonor Go, the marriage having been celebrated in the Catholic church of Bangued. He speaks and writes English as well as the Ilocano and Tagalog dialects. He graduated from the Abra Valley College, and finished his primary studies in the “Colegio” in Bangued, both schools being recognized by the government. He has a child two months old. He has never been accused of any crime involving moral turpitude. He is not opposed to organized government, nor is he a member of any subversive organization. He does not believe in, nor practice, polygamy. Since his birth, he has never gone abroad. He mingles with the Filipinos. He prefers a democratic form of government and stated that if his petition is granted he would serve the government either in the military or civil department. He is a merchant dealing in the buy and sell of tobacco. He also is part owner of a store in Bangued. In his tobacco business, he has a working capital of P10,000.00 which he claims to have been accumulated thru savings. He contributes to civic and charitable organizations like the Jaycees, Rotary, Red Cross and to town fiestas. He likes the customs of the Filipinos because he has resided in the Philippines for a long time. During the year 1956, he claims to have earned P1,000.00 in his tobacco business. With respect to the store of which he claims to be a part owner, he stated that his father gave him a sum of less than P3,000.00 representing one-fourth of the sales. Aside from being a co-owner of said store, he receives a monthly salary of P120,00 as a salesman therein. He took a course in radio mechanics and completed the same in 1955. He has no vice of any kind. He claims that he has never been delinquent in the payment of taxes. But he admitted that he did not file his income tax return when he allegedly received an amount of not less than P3,000 from his father which he claims to have invested in his tobacco business.

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Petitioner filed his petition for naturalization in the trial court. After hearing, the court ordered that a certificate of naturalization be issued to petitioner after the lapse of two years from the date the decision becomes final and all the requisites provided for in RA 503.

The government appealed the decision of the trial court.

The Supreme Court reversed the appealed decision, hold that the trial court erred in granting the petition for naturalization, without pronouncement as to costs.

1. Strict construction and rigid enforcement of naturalization lawsNaturalization laws should be rigidly enforced and strictly construed in favor of the government and against the applicant” (Co Quing Reyes vs. Republic, 104 Phil., 889).

2. Scope of the word “law”; Naturalization laws require belief in law should be belief in principle of Philippine ConstitutionThe scope of the word law in ordinary legal parlance does not necessarily include the constitution, which is the fundamental law of the land, nor does it cover all the principles underlying our constitution. In the case at bar, in so stating that he believes merely in our laws, he did not necessarily refer to those principles embodied in our constitution which are referred to in the law; the belief in democracy or in a democratic form of government is not sufficient to comply with the requirement of the law that one must believe in the principles underlying our constitution.

3. Belief in the law requires fulfillment of obligations required by lawPhilippine law requires that an alien to conducted himself in a proper and irreproachable manner during the entire period of his residence in the Philippines in his relation with the constituted government as well as with the community in which he is living. In the case at bar, petitioner failed to show that he has complied with his obligation to register his wife and child with the Bureau of Immigration as required by the Alien Registration Actl; and further failed to file his income tax return despite his fixed salary of P1,440.00 a year and his profit of P1,000.00 in his tobacco business, and received an amount less than P3,000 from his father as one-fourth of the proceeds of the sale of the store, the total of which is more than what is required by law for one to file an income tax return.

46. Lee Cho (@ Sem Lee) v. Republic [L-12408, 28 December 1959]En Banc, Bautista Angelo (J): 9 concurring

Facts: On 22 September 1907, petitioner was born in Amoy, China, of Chinese parents. He came to the Philippines sometime in February 1921 and was given the corresponding alien certificate of residence and registration. He settled in Cebu City (where he has continuously resided up to the present time). Petitioner studied 1st to 7th grade in Cebu Chinese High School, a private institution recognized by the government. He speaks and writes English and the Cebu dialect. He, having associated with some Filipinos, engaged in the corn business in Cebu City (1921-WWII) and in the lumber business (1946-present). He invested P5,000.00 capital in the business and at present the actual worth of his share is about P20,000.00. Petitioner is receiving a monthly salary of P400.00 and realizes a profit share worth P10,000.00 every year. He has no tax liability to the government. He possesses all the qualifications and none of the disqualifications prescribed by law.

As to his family, he married one Sy Siok Bin on 8 December 1929 with whom he had 13 children, all born in the Cebu City. All these children had been issued the corresponding alien certificate of registration, with the exception of Lourdes Lee who married a naturalized Filipino citizen named Lim Kee Guan. With the exception of William Lee who is not of school age, Angelita who reached only 5th grade and Lourdes who stopped in 3rd year high school, the other children are at present studying in private schools and colleges recognized by the government.

Lee Cho filed a petition for naturalization before the CFI Cebu. On 30 August 1956, the court rendered decision finding petitioner qualified to be a Filipino citizen. On 2 October 1957, however, the government filed a motion for new trial on the ground of newly discovered evidence which if presented may affect the qualification of petitioner, and finding the same well founded, the court entertained the motion. After rehearing, the court again rendered decision reaffirming its holding that petitioner is qualified to become a Filipino citizen. The government interposed an appeal.The Supreme Court ruled that appealed decision is reversed, with costs against petitioner.

1. Construction of Naturalization LawsThe provisions of the Naturalization Law should be strictly construed in order that its laudable and nationalistic purpose may be fully fulfilled. In the case at bar, the petitioner has not filed any declaration of intention to become a Filipino citizen because, as he claims, he has resided continuously in the Philippines for a period of more than 30 years and has given primary and secondary education to all his children in private schools recognized by the government. Angelita Lee has only reached grade five and no explanation was given why no secondary education was afforded her. Lourdes Lee has studied only as far as 3rd year high school and then allegedly stopped allegedly because of poor health. Lourdes admitted in open court, however, that she continued her studies in a Chinese school, which employs strictly Chinese curriculum, despite her illness. This circumstance betrays the sincerity of petitioner to become a Filipino citizen for if his motive were proper he should not have tolerated such deviation from the educational requirement of the law. The petitioner, thus, has failed to qualify to become a Filipino citizen.

47. Guerrero v. CA [GR L-44570, 30 May 1986]Second Division, Gutierrez (J): 4 concurring, 1 taking no part

Facts: On 8 August 1963, RA 3844 abolished and outlawed share tenancy and put in its stead the agricultural leasehold system. On 10 September 1971, RA 6389 amending RA 3844 declared share tenancy relationships as contrary to public policy.

In 1969, Apolinario Benitez was taken by Manuel and Maria Guerrero to take care of their 60 heads of cows which were grazing within their 21-hectare coconut plantation situated at the Subprovince of Aurora, Quezon. Benitez was allowed for that purpose to put up a hut within the plantation where he and his family stayed. In addition to attending to the cows, he was made to clean the already fruitbearing coconut trees, burn dried leaves and grass and to do such other similar chores. Harvest time which usually comes every 3 months. For his work related to the coconuts, he shared 1/3 of the proceeds from the copra he processed and sold in the market. For attending to the cows he was paid P500 a year.

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Sometime in the early part of 1973, Benitez was refrained from gathering nuts from the 10-hectare portion of the 16-hectare part of the plantation from where he used to gather nuts. He felt aggrieved by the acts of defendants and he brought the matter to the attention of the Office of Special Unit in the Office of the President in Malacañang, Manila. This led to an execution of an agreement whereby defendants agreed to let plaintiff work on the 16-hectare portion of the plantation as tenant thereon and that their relationship will be guided by the provisions of RA 1199 (Agricultural Tenancy Act of the Philippines).

Then in July, 1973, he was again refrained from gathering nuts from the 10-hectare portion of the plantation with threats of bodily harm if he persists to gather fruits therefrom. The Guerreros assigned Rogelio and Paulino Latigay to do the gathering of the nuts and the processing thereof into copra. Defendants Guerreros also caused to be demolished a part of the cottage where Benitez and his family lived, thus, making the Benitez feel that they meant business. Hence, the case for reinstatement with damages.

The Supreme Court dismissed the petition for lack of merit, and affirmed the CA decision. No costs.

1. Definition of agricultural tenancy“Agricultural tenancy” is defined by law as the physical possession by a person of land devoted to agriculture, belonging to or legally possessed by another for the purpose of production through the labor of the former and of the members of his immediate farm household in consideration of which the former agrees to share the harvest with the latter or to pay a price certain or ascertainable, either in produce or in money, or in both (Section 3, RA 1199, as amended.)

2. Definition of Share tenancy“Share tenancy” exists whenever two persons agree on a joint undertaking for agricultural production wherein one party furnishes the land and the other his labor, with either or both contributing any one or several of the items of production, the tenant cultivating the land with the aid of labor available from members of his immediate farm household, and the produce thereof to be divided between the landholder and the tenant in proportion to their respective contributions (Sec. 4, RA 1199: Sec. 166(25) RA 3844, Agricultural Land Reform Code).

3. Definition of farmhand or agricultural laborerA farmhand or agricultural laborer is any agricultural salary or piece worker but is not limited to a farmworker of a particular farm employer unless the Code expressly provides otherwise, and any individual whose work has ceased as a consequence of, or in connection with, a current agrarian dispute or an unfair labor practice and who has not obtained a substantially equivalent and regular employment” (Sec. 166 (15) RA 3844, Agricultural Land Reform Code).

4. Purposes of the agrarian reform lawThe repeal of the Agricultural Tenancy Act and the Agricultural Land Reform Code mark the movement not only towards the leasehold system but towards eventual ownership of land by its tillers. The phasing out of share tenancy was never intended to mean a reversion of tenants into mere farmhands or hired laborers with no tenurial rights whatsoever. Tenant’s right as share tenant do end with abolition of tenancy. The law seeks to “uplift the farmers from poverty, ignorance and stagnation to make them dignified, self-reliant, strong and responsible citizens . . . active participants in nation-building”, agricultural share tenants are given the right to leasehold tenancy as a first step towards the ultimate status of owner-cultivator, a goal sought to be achieved by the government program of land reform.

5. Exceptions to general rule on the effects of abrogation of a statuteAssuming such an abrogation of the law, the rule that the repeal of a statute defeats all actions pending under the repealed statute is a mere general principle. Among the established exceptions are when vested rights are affected and obligations of contract are impaired. (Aisporna v. Court of Appeals, 108 SCRA 481).

6. Distinction between agricultural laborer and tenant; Evidence of tenancy: longstanding possession, cultivation, sharing agreementLongstanding possession is an essential distinction between a mere agricultural laborer and a real tenant within the meaning of the tenancy law (Moreno, Philippine Law Dictionary, 1972 Edition), a tenant being one who has the temporary use and occupation of land or tenements belonging to another (Bouvier’s Law Dictionary, Vol. II, p. 3254) for the purpose of production (Sec. 3, RA 1199; delos Reyes v. Espinelli, 30 SCRA 574). A hired laborer who built his own house at his expense at the risk of losing the same upon his dismissal or termination any time, is more consistent with that of an agricultural tenant who enjoys security of tenure under the law.

Cultivation is another important factor in determining the existence of tenancy relationships. The mere fact that it was not the person possessing the land who had actually seeded the land does not mean that he is not a tenant of the land. The definition of cultivation is not limited merely to the tilling, plowing or harrowing of the land. It includes the promotion of growth and the care of the plants, or husbanding the ground to forward the products of the earth by general industry.

Agreement to share the produce or harvest on a “tercio basis” that is, a 1/3 to 2/3 sharing in favor of the landowners bolsters the tenancy claim. The agricultural laborer works for the employer, and for his labor he receives a salary or wage, regardless of whether the employer makes a profit. On the other hand, the share tenant participates in the agricultural produce. His share is necessarily dependent on the amount of harvest (delos Reyes v. Espinelli).

In the case at bar, besides these indications, the agreement made on 2 May 1973 is clear and categorical term that the Benitez is a tenant. Arguing that the intent was different, being that of a hired farmhand, the law existing at that time the agreement was made militate against the claim.

7. Extinguishing tenancy relationshipOnce a tenancy relationship is established, the tenant has the right to continue working until such relationship is extinguished according to law. The Agricultural Tenancy Act of 1954 (RA1199), the Agricultural Land Reform Code of 1963 (RA 3844), the Code of Agrarian Reforms (RA 6389) and Presidential Decree 1038 (Strengthening the Security of Tenure of Tenant Tillers in Non-Rice/Corn Producing Agricultural Lands) all provide for the security of tenure of agricultural tenants. Ejectment may be effected only for causes provided by law; such as (1) Violation or failure of the tenant to comply with any of the terms and conditions of the tenancy contract or any of the provisions of the Agricultural Tenancy Act; (2) The tenant’s failure to pay the agreed rental or to deliver the landholder’s share unless the tenant’s failure is caused by a fortuitous event or force majeure; (3) Use by the tenant of the land for purposes other than that specified by the agreement of the parties; (4) Failure of the tenant to follow proven farm practices; (5) Serious injury to the land caused by the negligence of the tenant; and (6) Conviction by a competent court of a tenant or any member of his immediate family or farm household of a crime against the landholder or a member of his immediate family.”

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(Section 50, RA 1199). In the case at bar, Benitez was unlawfully deprived of his right to security of tenure and the Court of Agrarian Reforms did not err in ordering the reinstatement of respondent as tenant and granting him damages therefor.

48. Bello v. CA (WALA)

49. City of Manila v. Chinese Community of Manila (WALA)

50. Villanueva v. Comelec [GR L-54718, 4 December 1985]Resolution En Banc, Teehankee (J): 9 concurring, 2 on leave

Facts: On 4 January 1980, the last day for filing of certificates of candidacy, one Narciso Mendoza, Jr. filed his sworn certificate of candidacy as independent for the office of vice-mayor of Dolores, Quezon in the 30 January 1980 local elections. Later that day, however, Mendoza filed an unsworn letter in his own handwriting withdrawing his said certificate of candidacy “for personal reasons.” His unsworn withdrawal had been accepted by the election registrar without protest nor objection. Later on 25 January 1980, petitioner Crisologo Villanueva, upon learning of his companion Mendoza’s withdrawal, filed his own sworn “Certificate of Candidacy in substitution” of Mendoza’s for the said office of vice mayor as a one-man independent ticket. Petitioner, as substitute candidate, circularized formal notices of his candidacy to all chairmen and members of the citizens election committees in compliance with the suggestion of the Comelec Law Manager, Atty. Zoilo Gomez.

The results showed petitioner to be the clear winner over respondent with a margin of 452 votes (3,112 votes as against his opponent respondent Lirio’s 2,660 votes). But the Municipal Board of Canvassers disregarded all votes cast in favor of petitioner as stray votes on ground that petitioner’s name does not appear in the certified list of candidates. The canvassers accordingly proclaimed respondent Vivencio G. Lirio as the only unopposed candidate and as the duly elected vice mayor of Dolores.

On 21 February 1980, Comelec denied the petition of Villanueva, stating that Mendoza’s withdrawal was not under oath as required by Section 27 of the 1978 Election Code, and that his withdrawal was not made after the last day for filing of certificate of candidacy, as contemplated by Section 28, but on the same day. On 31 July 1980, his petition was likewise denied.

On 3 May 1983, petitioner filed motion for reconsideration. On 10 June 1985, the respondents’ and petitioner’s consolidated reply and manifestation, and motion stated that private respondent has abandoned his claim to the office and accepted and assumed the position of municipal trial judge of Lucban and Sampaloc, Quezon.

The Supreme Court resolved to reconsider and sets aside the questioned Resolutions of Comelec and annuls the proclamation of Lirio as elected vice-mayor of Dolores, Quezon and instead declares petitioner as the duly elected vice-mayor of said municipality and entitled forthwith to assume said office, take the oath of office and discharge its functions. The resolution is made immediately executory.

1. Interpretation should be in consonance with substance and spirit of the lawSection 28 of the 1978 Election Code provides for such substitute candidates in case of death, withdrawal or disqualification up to mid-day of the very day of the elections. Mendoza’s withdrawal was filed on the last hour of the last day for regular filing of candidacies, which he had filed earlier that same day. For all intents and purposes, such withdrawal should therefore be considered as having been made substantially and in truth after the last day, even going by the literal reading of the provision by the Comelec.

2. The will of the electorate should be respectedThe will of the electorate should be respected, it should not be defeated through the invocation of formal or technical defects. (De Guzman vs. Board of Canvassers, 48 Phil, 211 [1925], citing Lino Luna vs. Rodriguez, 39 Phil. 208 [1918]; Badelles vs. Cabili, 27 SCRA 121 [1969]; Yra vs. Abaño, 52 Phil. 380 [1928]; Canceran vs. Comelec, 107 Phil. 607 [1960]; Corocoro vs. Bascara, 9 SCRA 522 [1963], Pungutan vs. Abubakar, 43 SCRA 11 [1972]; and Lacson, Jr. vs. Posadas 72 SCRA 170 [1976]). The will of the people cannot be frustrated by a technicality that the certificate of candidacy had not been properly sworn to. This legal provision is mandatory and non-compliance therewith before the election would be fatal to the status of the candidate before the electorate, but after the people have expressed their will, the result of the election cannot be defeated by the fact that the candidate has not sworn to his certificate or candidacy.” (See Guzman vs. Board of Canvassers, 48 Phil. 211, Gundan vs. Court of First Instance, 66 Phil. 125). The legal requirement that a withdrawal be under oath will be held to be merely directory (Canceran vs. Comelec, 107 Phil. 607) and Mendoza’s failure to observe the requirement should be “considered a harmless irregularity.” The bona fides of petitioner Villanueva as a substitute candidate cannot be successfully assailed. The votes cast in his favor must be counted.

51. In RE Tampoy: Diosdada Alberastine, petitioner [GR L-14322, 25 February 1960]En Banc, Bautista Angelo (p): 10 concurring

Facts: On 19 November 1939, Petronila Tampoy, a widow and without children, requested with Bonifacio Minoza to read a testament and explain its contents to her in her house in San Miguel street, municipality of Argao, province of Cebu in 19 November 1939, which he did in the presence of tree instrumental witnesses, Rosario K. Chan, Mauricio de la Pena, and Simeona Omboy. After confirming the contents of the testament, she requested Bonifacio Minoza to write her name at the foot of the testament in the second page, which he did, and after which she stamped her thumbmark between her name and surname in the presence of all three instrumental witnesses. Bonifacio Minoza also signed at the foot of the testament, in the second page, in the presence of the testator and all three abovenamed witnesses. However, the testator, just like Bonifacio Minoza, did not sign on the left margin or any part of the first page of the testament, composed of two pages. All the three instrumental witnesses signed at the foot of the acknowledgment written in the second page of the testament, and the left margin of the first and second page, in the presence of the testator, Bonifacio Minoza, Atty. Kintanar, and the others. The testament was executed freely and spontaneously, without having been threatened, forced and intimidated, and not having exercised on her (the testator) undue influence, being the same in full use of her mental faculties and enjoying good health.

On 22 February 1957, the testator died in here house in Argao.

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On 7 March 1957, or two weeks after, the heir found in the testament, Carman Aberastine died, leaving her mother, the petitioner Diosdada Alberastine.

After the petition was published in accordance with law and petitioner had presented oral and documentary evidence, the trial court denied the petition on the ground that the left hand margin of the first page of the will does not bear the thumbmark of the testatrix.

Petitioner appealed from this ruling. The Court of Appeals certified the case to the Supreme Court because it involves purely a question of law.

The Supreme Court affirmed the appealed order, without pronouncement as to costs.

1. Wills are strictly construed; lack of thumbmark in any of the page fatal.Statutes prescribing the formalities to be observed in the execution of wills are very strictly construed (Rodriguez vs. Alcala, 55 Phil., 150). A will must be executed in accordance with the statutory requirements; otherwise it is entirely void. (40 Cyc., 1097) All these requirements stand as of equal importance and must be observed, and courts cannot supply the defective execution of a will. No power or discretion is vested in them, either to superadd other conditions or dispense with those enumerated in the statutes (Uy Coque vs. Navas L. Sioca, 43 Phil., 405, 407; See also Saño vs. Quintana, 48 Phil., 506; Gumban vs. Gorecho 50 Phil., 30; Quinto vs. Morata, 54 Phil., 481). In the case at bar, the contention that the petition for probate is unopposed, and that the three testimonial witnesses testified and manifested to the court that the document expresses the true and voluntary will of the deceased, cannot be sustained as it runs counter to the express provision of the law. Since the will suffers the fatal defect, as it does not bear the thumbmark of the testatrix on its first page even if it bears the signature of the three instrumental witnesses, the same fails to comply with the law and therefore cannot be admitted to probate.

52. Matabuena v. Cervantes [GR L-28771, 31 March 1971]En Banc, Fernando (p): 9 concur, 1 took no part

Facts: On 20 February 1956, Felix Matabuena executed a Deed of Donation inter vivos in favor of Petronila Cervantes during the time they were living as husband and wife in a common law relationship. They were later married on 28 March 1962. Felix died intestate on 13 September 1962. Cornelia Matabuena, being the sole sister and nearest and nearest relative to Felix, questioned the validity of the donation claiming that the ban on donation between spouses during a marriage applies to a common-law relationship. She had the land declared on her name and paid the estate and inheritance taxes thereon on virtue of an affidavit of self-adjudication executed by her in 1962. On 23 November 1965, the lower court upheld the validity of the donation as it was made before Cervantes’ marriage to the donor. Hence, the appeal.

The Supreme Court (1) reversed the 23 November 1965 decision of the lower court; (2) declared the questioned donation void and recognized the rights of plaintiff and defendant as pro indiviso heirs to the property; and (3) remanded the case to the lower court for its appropriate disposition in accordance with the current decision; without pronouncement as to costs.

1. Prohibition of donation between spouses apply to common-law relationshipWhile Article 133 of the Civil Code considers as void a “donation between the spouses during the marriage,” policy considerations of the most exigent character as well as the dictates of morality require that the same prohibition should apply to a common-law relationship, as it is contrary to public policy (JBL Reyes, Buenaventura v. Bautista, 1954). The law prohibits donations in favor of the other consort and his descendants because of fear of undue and improper pressure and influence upon the donor, a prejudice deeply rooted in our ancient law; ‘porque no se engañen despojandose el uno al otro por amor que han de consuno [according to] the Partidas (Part IV, Tit. XI, LAW IV), reiterating the rationale ‘Ne mutuato amore invicem spoliarentur’ of the Pandects (Bk. 24, Tit. 1, De donat, inter virum et uxorem); then there is every reason to apply the same prohibitive policy to persons living together as husband and wife without the benefit of nuptials. For it is not to be doubted that assent to such irregular connection for thirty years bespeaks greater influence of one party over the other, so that the danger that the law seeks to avoid is correspondingly increased. Moreover, as already pointed out by Ulpian (in his lib. 32 ad Sabinum, fr. 1), ‘it would not be just that such donations should subsist, lest the condition of those who incurred guilt should turn out to be better.’ So long as marriage remains the cornerstone of our family law, reason and morality alike demand that the disabilities attached to marriage should likewise attach to concubinage.

2. Spirit of the lawWhatever omission may be apparent in an interpretation purely literal of the language used must be remedied by an adherence to its avowed objective. “El espiritu que informa la ley debe ser la luz que ha de guiar a los tribunales en la aplicación de sus disposiciones.'’ It is a principle of statutory construction that what is within the spirit of the law is as much a part of it as what is written. Otherwise the basic purpose discernible in such codal provision would not be attained.

3. Lack of validity of donation does not result in exclusive right of plaintiff on propertyThe lack of validity of the donation made by the deceased to Petronila Cervantes does not necessarily result in plaintiff having exclusive right to the disputed property. Prior to the death of Felix Matabuena, the relationship between him and the defendant was legitimated by their marriage. She is therefore his widow. As provided for in the Civil Code, she is entitled to one-half of the inheritance and the plaintiff, as the surviving sister, to the other half.

53. People v. Mapa [GR L-22301, 30 August 1967]En Banc, Fernando (p): 9 concur

Facts: Accused was charged for illegal possession of firearm and ammmunition in an information dated 14 August 1962 in connection with Section 2692 of the Revised Administrative Code, as amended by CA 56 and as further amended by RA 4. Accused admits to possession of firearm on ground of being a secret agent. On 27 November 1963, the lower court rendered a decision convicting the accused of the crime and sentenced him to imprisonment for one year and one day to two years. Appeal involves a question of law, as that it was taken to the Supreme Court.

The Supreme Court affirmed the appealed judgment.

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1. Law explicit, no provision made for secret agentThe law is explicit that except as thereafter specially allowed, it shall be unlawful for any person to possess any firearm, detached parts of firearms or ammunition therefor, or any instrument or implement used or intended to be used in the manufacture of firearms, parts of firearms, or ammunition. Firearms and ammunition regularly and lawfully issued to officers, soldiers, sailors, or marines [of the AFP, the PC, guards in the employment of the Bureau of Prisons, municipal police, provincial governors, lieutenant governors, provincial treasurers, municipal treasurers, municipal mayors, and guards of provincial prisoners and jails, are not covered when such firearms are in possession of such officials and public servants for use in the performance of their official duties. No provision is made for a secret agent.

2. Duty of the court to apply the law; Construction if application is impossible or inadequateThe first and fundamental duty of courts is to apply the law. Construction and interpretation come only after it has been demonstrated that application is impossible or inadequate without them. It is not within the power of this Court to set aside the clear and explicit mandate of a statutory provision.

3. People v. Macarandang modifiedIn People v. Macarandang, a secret agent was acquitted on appeal on the assumption that the appointment “of the accused as a secret agent to assist in the maintenance of peace and order campaigns and detection of crimes, sufficiently put him within the category of a ‘peace officer’ equivalent even to a member of the municipal police expressly covered by section 879. The Court ruled however that such reliance is misplaced in the present case and that the decision in People v. Macarandang no longer speaks with authority to the extent that the present decision conflicts with.

54. People v. Santayana [GR L-22291, 15 November 1976]Second Division, Concepcion Jr. (p): 4 concur, 1 took no part, 1 designated to sit in 2nd division

Facts: On 19 February 1962, Jesus Santayana y Escudero, was appointed as “Special Agent” by then Colonel Jose C. Maristela, Chief of the CIS. On 9 March 1962, a Memorandum Receipt for equipment was issued in the name of the accused regarding one pistol Melior SN-122137 with one (1) mag and stock. Col. Maristela likewise issued an undated certification to the effect that the accused was an accredited member of the CIS and the pistol described in the said Memorandum Receipt was given to him by virtue of his appointment as special agent and that he was authorized to carry and possess the same in the performance of his official duty and for his personal protection. On 29 October 1962, the accused was found in Plaza Miranda in possession of the pistol with four rounds of ammunition, cal. 25, without a license to possess them. An investigation was conducted and thereupon, a corresponding complaint was filed against the accused. The case underwent trial after which the accused was convicted of the crime charged with its corresponding penalty (indeterminate penalty of from 1 year and 1 day to 2 years and to pay the costs). Hence, the case was appealed to Supreme Court.

The Supreme Court reversed the appealed decision, conformably with the recommendation of the Solicitor General, and acquitted Jesus Santayana, canceling the bond for his provisional release. Costs de oficio.

1. CFI has jurisdictionThe CFI had concurrent jurisdiction over crime involving illegal possession of firearms by virtue of Section 44 of RA 296, providing that CFI has original jurisdiction in all criminal cases in which the penalty provided by law is imprisonment for more than 6 months, or a fine of more than two hundred pesos P200.00; and the offense charged in the information is punishable by imprisonment for a period of not less than 1 year and 1 day nor more than five 5 years, or both such imprisonment and a fine of not less than one thousand pesos P1,000.00 or more than five thousand pesos (P5,000.00).

2. Macarandang case prevailing; Mapa case does not apply to caseThe appointment of a civilian as “secret agent to assist in the maintenance of peace and order campaigns and detection of crimes sufficiently puts him within the category of a peace officer equivalent even to a member of the municipal police expressly covered by Section 879 (People v. Macarandang). In the case at bar, Santayana was appointed as CIS secret agent with the authority to carry and possess firearms. He was issued a firearm in the performance of his official duties and for his personal protection. Application of license was unnecessary, according to Col. Maristela, as the firearm is government property. No permit was issued, according to Capt. Adolfo Bringas as he was already appointed as a CIS agent.Even if the case of People vs. Mapa revoked the doctrine in the Macarandang case, this was made only on 30 August 1967, years after the accused was charged. Under the Macarandang rule therefore obtaining at the time of appellant’s appointment as secret agent, he incurred no criminal liability for possession of the pistol in question.

55. People v. Estenzo [GR L-35376, 11 September 1980]First Division, de Castro (p): 5 concur

Facts: In a decision dated 28 September 1940 by the Cadastral Court, Lot 4273 of the Ormoc Cadastre was declared public land.On 23 February 1972, Aotes filed with the CFI Leyte (Branch V, Ormoc City) a petition to reopen the cadastral decision, under RA 931 as amended by RA 6236, claiming to be the owners and possessors of Lot 4273 of the Ormoc Cadastre by virtue of hereditary succession but, due to their non-appearance on the date of the hearing of the Cadastral Case because of ignorance and excusable neglect, said land was declared public land and that they had been in adverse, peaceful and notorious possession of the said parcel of land since the time immemorial, paying all the taxes, interests and penalties. They pray that the decision of the Cadastral Court affecting Lot 4273, Ormoc Cadastre be reopened, and that they be allowed to file their cadastral answer. Opposition was made on 16 March 1972 claiming prescription. The judge denied the opposition for lack of sufficient merit on 9 May 1972, and rendered decision on 22 July 1972 after due hearing, declaring Lot 4273 public land and adjudicating said lot in favor of the Aoetes in undivided interest in equal share of ¼ each.

Dissatisfied with the decision of the lower court, petitioners filed the instant petition.

The Supreme Court set aside the 22 July 1972 decision of the respondent Judge and reiterating the 28 September 1940 decision of the Cadastral Court; without pronouncement as to costs.

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1. RA 931, RA 2061, and RA 6236RA 931 (20 June 1953) granted a right within 5 years from 20 June 1953 to petition for a reopening of cadastral proceedings. RA 2061 (13 June 1958) fixed a new time limit which is up to 31 December 1968 to file applications for free patents, for the judicial confirmation of imperfect or incomplete titles and for the reopening of judicial proceedings on certain lands which were declared public land. RA 6236 (19 June 1971) extended the time limit which is up to 31 December 1976 for the filing of applications for free patents and for the judicial confirmation of imperfect or incomplete titles. RA 6236 makes no reference to reopening of cadastral cases, unlike RA 2061.

2. Express mention is implied exclusionUnder the legal maxim of statutory construction, expressio unius est exclusio alterius (Express Mention is Implied Exclusion), the express mention of one thing in a law, as a general rule, means the exclusion of others not expressly mentioned. This rule, as a guide to probable legislative intent, is based upon the rules of logic and the natural workings of the human mind. In the case at bar, if RA 6236 had intended that the extension it provided for applies also to reopening of cadastral cases, it would have so provided in the same way that it provided the extension of time to file applications for free patent and for judicial confirmation of imperfect or incomplete title.

3. When construction comes inWhere the statutory norm speaks unequivocally, there is nothing for the courts to do except to apply it. The law, leaving no doubt as to the scope of its operation, must be obeyed. Likewise, it is a cardinal rule of statutory construction that where the terms of the statute are clear and unambiguous, no interpretation is called for, and the law is applied as written, for application is the first duty of courts, and interpretation, only were literal application is impossible or inadequate. The Court cannot alter the law, for such is a function that properly pertains to the legislative branch.

4. Res judicata; Cadastral case is a judicial proceeding in remGenerally, the fundamental principle of res judicata applies to all cases and proceedings, including land registration or cadastral proceedings. The doctrine of res judicata precludes parties from relitigating issues actually litigated and determined by a prior and final judgment. It is well-settled that a prior judgment is conclusive in a subsequent suit between the same parties on the subject matter, and on the same cause of action, not only as to matters which were decided in the first action, but also as to every other matter which the parties could have properly set up in the prior suit. Indeed, settled is the rule that a cadastral case is a judicial proceeding in rem, which, as such binds the whole world. The final judgment rendered therein is deemed to have settled the status of the land subject thereof, if not noted thereon, like those of the petitioner, are deemed barred under the principle of res judicata.

56. Mutuc v. Comelec [GR L-32717, 26 November 1970]First Division, Fernando (p): 7 concur, 2 on leave, 1 concur in separate opinion

Facts: Amelito Mutuc, a resident of Arayat, Pampanga filed his candidacy for the position of delegate to the Constitutional Convention. On 22 October 1970, he received a telegram from the Comelec, informing him that his certificate of candidacy was given due course but prohibiting him from using jingles in his mobile units equipped with sounds systems and loud speakers. Five days after or on 25 October, he filed a special civil action for prohibition alleging Comelec violated his constitutional right to freedom of speech due to the prohibition. There being no plain, speedy and adequate remedy, according to petitioner, he sought a writ of prohibition, at the same time praying for a preliminary injunction.

On the very next day, the Supreme Court adopted a resolution requiring the Comelec to file an answer not later than 2 November 1970, at the same time setting the case for hearing for 3 November 1970. No preliminary injunction was issued. There was no denial in the answer filed by Comelec of the factual allegations set forth in the petition, but the justification for the prohibition was premised on a provision of the Constitutional Convention Act, which made it unlawful for candidates “to purchase, produce, request or distribute sample ballots, or electoral propaganda gadgets such as pens, lighters, fans (of whatever nature), flashlights, athletic goods or materials, wallets, bandanas, shirts, hats, matches, cigarettes, and the like, whether of domestic or foreign origin.” The Court, after deliberation and taking into account the need for urgency, the election being barely a week away, issued on the afternoon of the same day, a minute resolution granting the writ of prohibition.

This decision was made to expound on the reasons behind the minute resolution. The Supreme Court permanently restrained and prohibited the Comelec from enforcing or implementing or demanding compliance with its order banning the use of political taped jingle, pursuant to the SC resolution of 3 November 1970; without pronouncement as to costs.

1. Ejusdem GenerisThe principle of ejusdem generis provides the general words following any enumeration being applicable only to things of the same kind or class as those specifically referred to. In the case at bar, The Constitutional Convention Act contemplated the prohibition on the distribution of gadgets of the kind referred to as a means of inducement to obtain a favorable vote for the candidate responsible for its distribution (distribution of electoral propaganda gadgets, mention being made of pens, lighters, fans, flashlights, athletic goods or materials, wallets, bandanas, shirts, hats, matches, and cigarettes, and concluding with the words “and the like.”).

2. Construction should be in consonance to the ConstitutionIt is a cardinal principle of construction that a statute should be interpreted to assure its being in consonance with, rather than repugnant to, any constitutional command or prescription. The desirability of removing in that fashion the taint of constitutional infirmity from legislative enactments has always commended itself. The judiciary may even strain the ordinary meaning of words to avert any collision between what a statute provides and what the Constitution requires. The objective is to reach an interpretation rendering it free from constitutional defects. If at all possible, the conclusion reached must avoid not only that it is unconstitutional, but also grave doubts upon that score.

3. Freedom of speech and free press is a preferred freedomIn unequivocal language, the Constitution prohibits an abridgment of free speech or a free press. It has been our constant holding that this preferred freedom calls all the more for the utmost respect when what may be curtailed is the dissemination of information to make more meaningful the equally vital right of suffrage. In the case at bar, the act of the Comelec in effect imposed censorship on petitioner, and evil against which the constitutional right is directed. Further, the constitutional guarantee is not to be emasculated by confining it to a speaker having his say, but not perpetuating what is uttered by him through tape or other mechanical contrivances.

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4. The Constitution is Supreme LawThe concept of the Constitution as the fundamental law, setting forth the criterion for the validity of any public act whether proceeding from the highest official or the lowest functionary, is a postulate of our system of government. That is to manifest fealty to the rule of law, with priority accorded to that which occupies the topmost rung in the legal hierarchy. The three departments of government in the discharge of the functions with which it is entrusted have no choice but to yield obedience to its commands. Whatever limits it imposes must be observed. Congress in the enactment of statutes must ever be on guard lest the restrictions on its authority, whether substantive or formal, be transcended. The Presidency in the execution of the laws cannot ignore or disregard what it ordains. In its task of applying the law to the facts as found in deciding cases, the judiciary is called upon to maintain inviolate what is decreed by the fundamental law. Even its power of judicial review to pass upon the validity of the acts of the coordinate branches in the course of adjudication is a logical corollary of this basic principle that the Constitution is paramount. It overrides any governmental measure that fails to live up to its mandates. Thereby there is a recognition of its being the supreme law.

5. Power of the Comelec limited to administrative questionsAs the branch of the executive department — although independent of the President — to which the Constitution has given the exclusive charge of the enforcement and administration of all laws relative to the conduct of elections, the power of decision of the Comelec is limited to purely administrative questions. The Comelec cannot exercise any authority in conflict With or outside of the law, and there is no higher law than the Constitution.

57. People v. Manantan [GR L-14129, 31 July 1962]En Banc, Regala (p): 7 concur, 1 took no part, 1 on leave

Facts: In an information filed by the Provincial Fiscal of Pangasinan in the CFI of that Province, Guillermo Manantan was charged with a violation of Section 54 of the Revised Election Code. A preliminary investigation conducted by said court resulted in the finding of a probable cause that the crime charged was committed by the defendant. Thereafter, the trial started upon defendant’s plea of not guilty, the defense moved to dismiss the information on the ground that as justice of the peace, the defendant is not one of the officers enumerated in Section 54 of the Revised Election Code. The lower court denied the motion to dismiss, holding that a justice of the peace is within the purview of Section 54. A second motion was filed by defense counsel who cited in support thereof the decision of the CA in People vs. Macaraeg, (C.A.-G.R. No. 15613-R, 54 Off. Gaz., pp. 1873-76) where it was held that a justice of the peace is excluded from the prohibition of Section 54 of the Revised Election Code. Acting on this second motion to dismiss, the answer of the prosecution, the reply of the defense, and the opposition of the prosecution, the lower court dismissed the information against the accused upon the authority of the ruling in the case cited by the defense. Hence, the appeal by the Solicitor General.The Supreme Court set aside the dismissal order entered by the trial court and remanded the case for trial on the merits.

1. Justice of peace is a judge; Judge definedA justice of the peace is sometimes addressed as “judge” in this jurisdiction. It is because a justice of the peace is indeed a judge. A “judge” is a public officer, who, by virtue of his office, is clothed with judicial authority. A judge is a public officer lawfully appointed to decide litigated questions according to law. In its most extensive sense the term includes all officers appointed to decide litigated questions while acting in that capacity, including justice of the peace, and even jurors, it is said, who are judges of facts. The intention of the Legislature did not exclude the justice of the peace from its operation. In Section 54, there is no necessity to include the justice of peace in the enumeration, as previously made in Section 449 of the Revised Administrative Code, as the legislature has availed itself of the more generic and broader term “judge,” including therein all kinds of judges, like judges of the courts of First Instance, judges of the courts of Agrarian Relations, judges of the courts of Industrial Relations, and justices of the peace (Still, it is to be noted that the first omission of the words “justice of the peace” was effected in Section 48 of Commonwealth Act 357; not the law being contrasted. In every case the word “judge” is used, it is not qualified by “of the first instance”. In every case the word “judge of the first instance”, it is followed by “justice of the peace”).

2. History of the Philippine Election lawThe first election law in the Philippines was Act 1582 (Philippine Commission, 1907), and which was later amended by Acts 1669, 1709*, 1726 and 1768. Act 1582, with its subsequent 4 amendments were later on incorporated in Chapter 18 of the Administrative Code. Under the Philippine Legislature, several amendments were made through the passage of Act 2310, 3336 and 3387*. During the time of the Commonwealth, the National Assembly passed Commonwealth Act 233 and later on enacted Commonwealth Act 357, which was the law enforced until 21 June 1947, when the Revised Election Code was approved. Included as its basic provisions are the provisions of Commonwealth Acts 233, 357, 605, 666, and 657. The present Code was further amended by RA 599, 867, 2242 and again, during the session of Congress in 1960, amended by RA 3036 and 3038.

3. “Of any province” construedThe words “Of any province” cannot remove justices of the peace from the enumeration for the reason that they are municipal and not provincial officials, as a contrary view would likewise exclude justices of the Supreme Court and of the Court of Appeals, who are national officials. The more sensible and logical interpretation of the said phrase is that it qualifies fiscals, treasurers and assessors who are generally known as provincial officers.

4. Casus omisus pro omisso habendus est; applicationUnder the rule, a person, object or thing omitted from an enumeration must be held to have been omitted intentionally. The maxim “casus omisus” can operate and apply only if and when the omission has been clearly established. The application of the rule of “casus omisus” does not proceed from the mere fact that a case is criminal in nature, but rather from a reasonable certainty that a particular person, object or thing has been omitted from a legislative enumeration. Substitution of terms is not omission.

5. The rule of strict construction of penal statutes not only factor to interpret laws; Intent or spirit of law may be consideredThe rule that penal statutes are given a strict construction is not the only factor controlling the interpretation of such laws. Instead, the rule merely serves as an additional, single factor to be considered as an aid in determining the meaning of penal laws. Cases will frequently be found enunciating the principle that the intent of the legislature will govern. It is to be noted that a strict construction should not be permitted to defeat the policy and purposes of the statute. The court may consider the spirit and reason of a statute, as in this particular instance, where a literal meaning would lead to absurdity, contradiction, injustice, or would defeat the clear purpose of the law makers. The strict construction of a criminal statute does not mean such construction of it as to deprive it of the meaning intended. Penal statutes must be construed in the sense which best harmonizes with their intent and purpose. It must be noted that the purpose of the statute is to enlarge the officers within its purview;

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the contention that the justice of the peace from the enumeration is contrary to the purpose; as the partisan political activities of judges weaken rather than strengthen the judiciary.

6. Executive department regard justice of peace within purview of Section 54The administrative or executive department has regarded justices of the peace within the purview of Section 54 of the Revised Election Code (See Calo. v. Executive Secretary; the justice of peace of Carmen, Agusan was dismissed for engaging in electioneering).

7. Intent of the legislature cannot be derived from a proposed billUntil the bill becomes a law, it cannot be considered to contain or manifest any legislative intent. If the motives, opinions, and the reasons expressed by the individual members of the legislature, even in debates, cannot be properly taken into consideration in ascertaining the meaning of a statute, fortiori what weight can the Court give to mere draft of a bill.

8. Expressio unius, est exclusio alterius not applicable in caseWhere a statute appears on its face to limit the operation of its provisions to particular persons or things by enumerating them, but no reason exists why other persons or things not so enumerated should not have been included, and manifest injustice will follow by not so including them, the maxim expresio unius est exclusio alterius, should not be invoked.

58. Lopez v. CTA (WALA)

59. Sanciangco v. Rono [GR L-68709, 19 July 1985]En Banc, Melencio-Herrera (p): 10 concur, 1 dissents in separate opinion, 1 took no part

Facts: Petitioner was elected Barangay Captain of Barangay Sta. Cruz, Ozamiz City, in the 17 May 1982 Barangay elections. Later, he was elected President of the Association of Barangay Councils (ABC) of Ozamiz City by the Board of Directors of the said Association. As the President of the Association, petitioner was appointed by the President of the Philippines as a member of the City’s Sangguniang Panlungsod. On 27 March 1984, petitioner filed his Certificate of Candidacy for the 14 May 1984 Batasan Pambansa elections for Misamis Occidental under the banner of the Mindanao Alliance. He was not successful in the said election. Invoking Section 13(2), Article 5 of BP 697, petitioner informed Vice-Mayor Benjamin A. Fuentes, Presiding Officer of the Sangguniang Panlungsod, that he was resuming his duties as member of that body. The matter was elevated to the Minister of Local Government Jose A. Roño, who ruled that since petitioner is an appointive official, he is deemed to have resigned from his appointive position upon the filing of his Certificate of Candidacy.

The Supreme Court dismissed the petition and denied the writs prayed for, holding that there was no grave abuse of discretion on the part of the officials; without costs.

1. Petitioner holds public appointive positionThe petitioner holds a public appointive position. He was appointed by the President as a member of the City’s Sangguniang Panlungsod by virtue of his having been elected President of the Association of Barangay Councils. This was pursuant to Section 3, paragraph 1 of BP 51 (An Act Providing for the elective or Appointive Positions in Various Local Governments and for Other Purposes), and reiterated by Section 183 of the Local Government Code (BP 337). Since petitioner is unquestionably an appointive member of the Sangguniang Panlungsod of Ozamiz City, he is deemed to have ipso facto ceased to be such member when he filed his certificate of candidacy for the 14 May 1984 Batasan elections.

2. Statute to be construed in its entirety, and not taken as detached and isolated expressions; Legislative intent consideredIt is a rule of statutory construction that when the language of a particular section of a statute admits of more than one construction, that construction which gives effect to the evident purpose and object sought to be attained by the enactment of the statute as a whole, must be followed. A statute’s clauses and phrases should not be taken as detached and isolated expressions, but the whole and every part thereof must be considered in fixing the meaning of any of its parts. The legislative intent to cover public appointive officials in subsection (1), and officials mentioned in subsection (2) which should be construed to refer to local elective officials, can be gleaned from the proceedings of the Batasan Pambansa.

3. No violation of equal protection clause or of due process of lawThere was no violation of the equal protection clause since Section 13 of BP 697 applies alike to all persons subject to such legislation under like circumstances and conditions. Neither was the petitioner removed from office without due process of law since it was of his own choice that he ran for a seat in the Batasan Pambansa. The consequence that followed his unsuccessful attempt at the elections arose from law. In the case at bar, the petitioner continues to be President of the Association of Barangay Councils. He will need a reappointment by the President to be a part of the Sangguniang Panglungsod of Ozamis City,

60. Caltex v. Palomar [GR L-19650, 29 September 1966]En Banc, Castro (p): 9 concur

Facts: In 1960 Caltex conceived a promotional scheme denominated as “Caltex Hooded Pump Contest.” It calls for participants to estimate the actual number of liters hooded gas pump at each Caltex station will dispense during a specified period. Participation is to be open indiscriminately to all “motor vehicle owners and/or licensed drivers”. For the privilege to participate, no fee or consideration is required to be paid, no purchase of Caltex products required to be made. Entry forms are to be made available upon request at each Caltex station where a sealed can will be provided for the deposit of accomplished entry stubs. A three-staged winner selection system is envisioned, the Dealer contest at the station level, the regional contest in 7 different regions, and the national level. Foreseeing the extensive use of the mails not only as amongst the media for publicizing the contest but also for the transmission of communications relative thereto, representations were made by Caltex with the postal authorities for the contest to be cleared in advance for mailing, having in view sections 1954(a), 1982 and 1983 of the Revised Administrative Code. This was formalized by Caltex in a letter to the Postmaster General on 31 October 1960. The then Acting Postmaster General, however, declined the grant the requested clearance. On 7 December 1960, Caltex sought a reconsideration. Relying, however, on an opinion rendered by the Secretary of Justice on an unrelated case 7 years before (Opinion 217, s. 1953), the Postmaster General

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maintained that the contest involves consideration, or that, if not, it is nevertheless a “gift enterprise” which is equally banned by the Ponstal Law, and in his letter of 10 December 1960 not only denied the use of the mails for purposes of the proposed contest but as well threatened that if the contest was conducted, “a fraud order will have to be issued against Caltex and all its representatives.Caltex thereupon invoked judicial intervention by filing a petition for declaratory relief against Postmaster General Enrico Palomar, praying that judgment be rendered declaring its Caltex Hooded Pump Contest not to be violative of the Postal Law, and ordering respondent to allow petitioner the use of the mails to bring the contest to the attention of the public. The trial court ruled that the contest does not violate the Postal Code and that Palomar has no right to bar the public distribution of the contest rules by the mails. Palomar appealed.The Supreme Court affirmed the appealed judgment, without costs.

1. Declaratory relief, when utilizedBy express mandate of section 1 of Rule 66 of the old Rules of Court, declaratory relief is available to any person whose rights are affected by a statute to determine any question of construction or validity arising under the statute and for a declaration of his rights or duties thereunder (now section 1, Rule 64, Revised Rules of Court).

2. Conditions sine qua non for declaratory reliefConditions sine qua non: (1) there must be a justiciable controversy; (2) the controversy must be between persons whose interests are adverse; (3) the party seeking declaratory relief must have a legal interest in the controversy; and (4) the issue involved must be ripe for judicial determination. In the case at bar, all the conditions are present. Caltex’s insistent assertion of its claim to the use of the mails for its proposed contest, and the challenge thereto and consequent denial by Palomar of the privilege demanded, undoubtedly spawned a live controversy. There is an active antagonistic assertion of a legal right on one side and a denial thereof on the other, concerning a real question or issue. The contenders are as real as their interest are substantial. To Caltex, the uncertainty occasioned by the divergence of views on the issue of construction hampers or disturbs its freedom to enhance its business. To Palomar, the suppression of Caltex’s proposed contest believed to transgress a law he has sworn to uphold and enforce is an unavoidable duty. With Caltex’s bent to hold the contest and the Palomar’s threat to issue a fraud order therefor if carried out, the contenders are confronted by the ominous shadow of an imminent and inevitable litigation unless their differences are settled and stabilized by a tranquilizing declaration.

3. Definition of Statutory ConstructionConstruction is the art or process of discovering and expounding the meaning and intention of the authors of the law with respect to its application to a given case, where that intention is rendered doubtful, amongst others, by reason of the fact that the given case is not explicitly provided for in the law (Black). In the case at bar, whether or not the scheme proposed by the appellee is within the coverage of the prohibitive provisions of the Postal Law inescapably requires an inquiry into the intended meaning of the words used therein.

4, Judicial duty to look into substance of lawThe Court is tasked to look beyond the fair exterior, to the substance, in order to unmask the real element and pernicious tendencies which the law is seeking to prevent.

5. Case not an advisory opinion nor premature; Rules of Court liberally construedEven if there has been no breach of the Postal Law yet, there is propriety or necessity of setting the dispute at rest before it accumulates the asperity, distemper, animosity, passion and violence of a full-blown battle which looms ahead. Denial of declaratory relief would force it to choose between undesirable alternatives: that of being a self-appointed censor, or that to be at risk of a fraud order. Considering the alternatives in one equation and in the spirit of liberality with which the Rules of Court are to be interpreted in order to promote their object (Section 1, Rule 1, Revised Rules of Court), i.e. to settle, and afford relief from uncertainty and insecurity with respect to, rights and duties under a law; there is no imposition upon the Court’s jurisdiction or any futility or prematurity in our intervention.

6. Judicial decision interpreting or applying a law forms part of legal systemJudicial decisions applying or interpreting the law shall form a part of the legal system”(Article 8, Civil Code of the Philippines). In effect, judicial decision assume the same authority as the statute itself and, until authoritatively abandoned, necessarily become, to the extent that they are applicable, the criteria which must control the actuations not only of those called upon to abide thereby but also of those in duty bound to enforce obedience thereto. The jurisdiction of the Court, nor its ruling’s force and binding effect, cannot be underrated not to have the final and pacifying function that a declaratory judgment is calculated to subserve. At the very least, the appellant will be bound. Precedent are abundant to support the conclusion that the Court has reached (Liberty Calendar Co. v. Cohen, 19 NJ 399, 117 A 2d 487; In pari material, also: Bunis v. Conway, 17 App. Div. 2d, 207, 234 NYS 2d, 435; Zeitlin v. Arnebergh, supra.; Thrillo, Inc. v. Scott, 15 NJ Super. 124, 82 A. 2d, 903)

7. Lottery and gift enterprise defined; Caltex contest not a lottery nor gift enterpriseThe term ‘lottery’ extends to all schemes for the distribution of prizes by chance, such as policy playing, gift exhibitions, prize concerts, raffles at fairs, etc., and various forms of gambling. The three essential elements of a lottery are: First, consideration; second, prize; and third, chance (El Debate v. Topacio, 44 Phil 278, 1922; citing various jurisprudence). With respect to the last element of consideration, the law does not condemn the gratuitous distribution of property by chance, if no consideration is derived directly or indirectly from the party receiving the chance, but does condemn as criminal schemes in which a valuable consideration of some kind is paid directly or indirectly for the chance to draw a prize.While an all-embracing concept of the term “gift enterprise” is yet to be spelled out in explicit words, there appears to be a consensus among lexicographers and standard authorities that the term is commonly applied to a sporting artifice under which goods are sold for their market value but by way of inducement each purchaser is given a chance to win a prize.In the case at bar, there is no requirement in the rules that any fee be paid, any merchandise be bought, any service be rendered, or any value whatsoever be given for the privilege to participate; for the scheme to be deemed a lottery. Neither is there is a sale of anything to which the chance offered is attached as an inducement to the purchaser for the scheme to be deemed a gift enterprise. The scheme is merely a gratuitous distribution of property by chance.

8. Consideration does not consist of benefit derived by sponsor of the contestThe required element of consideration does not consist of the benefit derived by the proponent of the contest. The true test is whether the participant pays a valuable consideration for the chance, and not whether those conducting the enterprise receive something of value in return for the distribution of the prize. Perspective properly oriented, the standpoint of the contestant is all that matters, not that of the sponsor (People vs. Cardas, 28 P. 2d. 99, 137 Cal. App. (Supp). 788)

9. Conflicting viewpoints on gift enterprise warrants resolution on case-to-case basis

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The apparent conflict of opinions (for one: holding that a gift enterprise involving an award by chance, even in default of the element of consideration necessary to constitute a lottery, is prohibited; or the other: like a lottery, a gift enterprise comes within the prohibitive statutes only if it exhibits the tripartite elements of prize, chance and consideration) is explained by the fact that the specific statutory provisions relied upon are not identical. In some cases, the terms “lottery” and “gift enterprise” are used interchangeably; in others, the necessity for the element of consideration or chance has been specifically eliminated by statute. Every case, thus, must be resolved upon the particular phraseology of the applicable statutory provision.

10. Noscitur a sociisConsonant to the well-known principle of legal hermeneutics noscitur a sociis, the term under construction should be accorded no other meaning than that which is consistent with the nature of the word associated therewith. Hence, if lottery is prohibited only if it involves a consideration, so also must the term “gift enterprise” be so construed. Significantly, there is not in the law the slightest indicium of any intent to eliminate that element of consideration from the “gift enterprise” therein included. This conclusion firms up in the light of the mischief sought to be remedied by the law, resort to the determination thereof being an accepted extrinsic aid in statutory construction. Mail fraud orders, it is axiomatic, are designed to prevent the use of the mails as a medium for disseminating printed matters which on grounds of public policy are declared non-mailable. As applied to lotteries, gift enterprises and similar schemes, justification lies in the recognized necessity to suppress their tendency to inflame the gambling spirit and to corrupt public morals. Gratuitous distribution of property by lot or chance does not constitute ‘lottery’, if it is not resorted to as a device to evade the law and no consideration is derived, directly or indirectly, from the party receiving the chance, gambling spirit not being cultivated or stimulated thereby. Thus, gift enterprises and similar schemes therein contemplated are condemnable only if, like lotteries, they involve the element of consideration.

61. Capati v. Ocampo (WALA)

62. Amon Trading Corp. v. CA (WALA)

63. GMCR vs. Bell Telecommunication Philippines (BellTel)GR 126496, 30 April 1997; First Division, Hermosisima Jr. (J)

Facts: On 19 October 1993, BellTel filed with the NTC an application for a certificate of public convenience with a further request for the issuance of a provisional authority (NTC Case 93-481). On 25 March 1994, RA 7692 was enacted granting BellTel a legislative franchise to operate business of providing telecommunication services. In 12 July 1994, BellTel a legislative franchise to operate business of providing telecommunication services. On 12 July 1994, BellTel filed a second application for a certificate of public convenience, proposing to install 2.6 million telephone lines in 10 years and to provide a 100% digital local exchange network (NTC Case 94-229). It also moved for the withdrawal of the first application, without prejudice, which was granted by the NTC. BellTel’s application (2nd ) was opposed by various telecommunication companies. BellTel’s application was referred to the Common Carriers Authorization Department (CCAD), which found BellTel’s proposal technically feasible and BellTel to be financially capable. The two deputy commissioners of the NTC signified their approval of the CCAD recommendation. The working draft was prepared by the legal department, was initialed by the two deputy commissioners, but was not signed by NTC Commissioner Simeon Kintanar. BellTel filed a motion to promulgate, after previously filing two urgent ex-parte motion to resolve application which were not acted upon by the NTC. On 4 July 1995, the NTC denied the motion in an order signed solely by Commissioner Kintanar. On 17 July 1995, BellTel filed a petition for certiorari, mandamus and prohibition against NTC before the Supreme Court. The Court referred the case to the Court of Appeals pursuant to Paragraph 1, Section 9 of BP 129. The Court of Appeals granted BellTel’s position. Hence, the petitions for review by the opposing telecommunication companies and Commissioner Kintanar.

Issue: Whether the vote of the Chairman of the Commission is sufficient to legally render an NTC order, resolution or decision.

Held: Having been organized under Executive Order 146 as a three-man commission, the NTC is a collegial body and was a collegial body even during the time it was acting as a one-man regime. NTC is a collegial body requiring a majority vote out of three members of the commission in order to validly decide a case or any incident therein. The vote alone of the chairman of the Commission, absent the required concurring vote coming from the rest of the membership of the commission to at least arrive at a majority decision, is not sufficient to legally render an NTC order, resolution or decision. NTC Circulars 1-1-93, 3-1-93 and the Order of Kintanar, declaring the NTC as a single entity or non-collegial entity, are contrary to law and thus are null and void.

64. Alfon v. Republic [GR L-51201, 29 May 1980]Second Division, Abad Santos (p): 4 concur

Facts: Maria Estrella Veronica Primitiva Duterte was born on 15 May 1952 at the UST Hospital to Filomeno Duterte and Estrella. She was registered at the Local Civil Registrar’s Office as Maria Estrella Veronica Primitiva Duterte. On 15 June 1952, she was baptized as Maria Estrella Veronica Primitiva Duterte at the St. Anthony de Padua Church, Singalong, Manila. Estrella Veronica Primitiva Duterte has been taken cared of by Mr. and Mrs. Hector Alfon. She lived in Mandaluyong for 23 years with her uncle, Hector Alfon. When Maria Estrella started schooling, she used the name Estrella S. Alfon. She attended her first grade up to fourth year high school at Stella Maris College using the name Estrella S. Alfon. After graduating from high school she enrolled at the Arellano University and finished Bachelor of Science in Nursing. Her scholastic records from elementary to college show that she was registered by the name of Estrella S. Alfon. Petitioner has exercised her right of suffrage under the same name. She has not committed any felony or misdemeanor.

She filed a verified petition on 28 April 1978 praying that her name be changed from Maria Estrella Veronica Primitiva Duterte to Estrella S. Alfon. The CFI (Branch XXIII) partially denied petitioner’s prayer on 29 December 1978, granting the change of first name but not the surname.

The Supreme Court modified the appealed order in as much as that petitioner is allowed to change not only her first name but also her surname so as to be known as Estrella S. Alfon; without costs.

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1. Principally is not equivalent to exclusivelyThe word “principally” as used in article 364 of the Civil Code is not equivalent to “exclusively” so that there is no legal obstacle if a legitimate or legitimated child should choose to use the surname of its mother to which it is equally entitled. In the case at bar, the lower court erred in reasoning that as legitimate child of Filomeno Duterte and Estrella Alfon she should principally use the surname of her father.

2. Grounds for change of nameThe following may be considered, among others, as proper or reasonable causes that may warrant the grant of a petitioner for change of name; (1) when the name is ridiculous, tainted with dishonor, or is extremely difficult to write or pronounce; (2) when the request for change is a consequence of a change of status, such as when a natural child is acknowledged or legitimated; and (3) when the change is necessary to avoid confusion (1 Tolentino 660, Civil Code of the Philippines, 1953 ed; Haw Liong v. Republic). In the case at bar, to avoid confusion, the petition of name should be granted as the petitioner has been using the name of Estrella S. Alfon since childhood.

65. Rura v. Lopena [GR L-69810-14, 19 June 1985]Second Division, Abad Santos (p): 5 concur

Facts: Teodulo Rura was accused, tried and convicted of five (5) counts of estafa committed on different dates in the Municipal Circuit Trial Court of Tubigon-Clarin, Tubigon, Bohol, denominated as Criminal Case 523, 524, 525, 526 and 527. The 5 cases were jointly tried and a single decision was rendered on 18 August 1983. Rura was sentenced to a total prison term of 17 months and 25 days. In each criminal case the sentence was 3 months and fifteen 15 days.

Rura appealed to the RTC Bohol but said court affirmed the decision of the lower court. When the case was remanded to the court of origin for execution of judgment, Rura applied for probation. The application was opposed by a probation officer of Bohol on the ground that Rura is disqualified for probation under Section 9 (c) of PD 968 or the Probation Law (i.e. applicable to those who have previously been convicted by final judgment of an offense punished by imprisonment of not less than 1 month and 1 day and/or a fine of not less than P200). The court denied the application for probation. A motion for reconsideration was likewise denied. Hence the instant petition.

The Supreme Court granted the probation and directed the judge to give due course to the petitioner’s application for probation; without costs.

1. “Previous” applies to date of conviction, not to date of commission of a crimeThe statute relates “previous” to the date of conviction, not to the date of the commission of the crime. When the accused applied for probation he had no previous conviction by final judgment. When he applied for probation the only conviction against him was the judgment which was the subject of his application. Conviction does not retroact to the day of the commission of the crime.

66. NHA vs. Juco

67. Demafiles vs. Comelec

68. Arabay vs. CFI of Zamboanga del Norte

69. People vs. Mejia

70. Manila Railroad Co. v.Collector of Customs

71. Almeda vs. Florentino

72. Laxamana v. Baltazar

73. Butuan Sawmill v. City of Butuan

74. Arayata vs. Joya

75. City of Manila vs. Teotico

76. David vs. Comelec

77. Roman Catholic Archbishop of Manila v. SSC

78. David v. COMELEC

79. NHA vs. Reyes

80. Paat v. CA

81. Tac-an vs. CA

82. Villegas v. Subido

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