GENERAL POLICIES OF CONSTRUCTION

G.R. No. L-13032 August 31, 1959

PHILIPPINE-AMERICAN DRUG COMPANY, petitioner,

vs.
COLLECTOR OF INTERNAL REVENUE and COURT OF TAX APPEALS,
respondents.

Jose F. Ochoa for petitioner.

Assistant Solicitor General Jose P. Alejandro and Attorney Alejandro B. Afurong for
respondents.

BARRERA, J.:

Based on a stipulation of facts submitted by the parties, Philippine American Drug Co.,
petitioner, and the Collector of Internal Revenue, respondent in CTA Case No. 265 the
pertinent portions of which are quoted hereunder:

2. That during the period from February 14, 1951 to December 31, 1954,
petitioner did not for purposes of computing the advance sales tax on its
importations include as part of the landed cost the difference (P.015) between
the amounts actually paid by it to the bank on said importations computed at the
rate of P2.015 for every U. S. dollar and the value of the imported goods
computed at the legal rate of P2.00 for every U. S. dollar;

3. That the difference of P0.015 represents the premium on the dollar charged by
the bank and paid by the petitioner in the purchase of foreign exchange;

4. That in November 4, 1955, respondent demanded from petitioner (Demand

No. 13756) the payment of the sum of P10, 243.13 as deficiency advance sales
tax, . .;

xxx xxx xxx

9. That the only question involved in this case is whether or not the difference of
P0.015, representing the premium on the dollar charged by the bank to the
importer-petitioner and paid by it in the purchase of foreign exchanged (U. S.
dollar), should from part of the landed cost of the imported articles for purposes
of computing the advance sales tax, assuming that respondent's ruling dated
June 21, 1954, as quoted in the 5th paragraph hereof, was issued in accordance
with law and reflects the correct interpretation thereof;

xxx xxx xxx

the Court of Tax Appeals rendered judgment in said case upholding the validity of the
decision of the Collector of Internal Revenue imposing sales tax on the bank premium of
P0.015 for every U. S. dollar purchased by the petitioner Philippine American Drug Co.
required for its importations from February 14, 1951, to December 31, 1954, which tax
together with the surcharges thereon, amounted to P10,243.13. Hence, this appeal by
the taxpayer.

In demanding collection of the disputed assessment, the respondent Collector of

Internal Revenue invokes Section 183-(B), as amended, of the National Internal
Revenue Code which provides:

SEC. 183. Payment of percentage taxes. —

xxx xxx xxx

(B) Sales tax on imported articles. When the articles are imported, the
percentage taxes established in section one hundred eighty-four, one hundred
eighty-five, and one hundred eighty-six of this code shall be paid in advance by
the importer, in accordance with regulations promulgated by the Secretary of
Finance and prior to the release of such articles from custom's custody, based on
the import invoice value thereof, certified to as correct by the Philippine Consul at
the port of origin if there is any, including freight, postage, insurance,
commission, customs duty and all similar charges, plus one hundred per centum
of such total value in the case of articles enumerated in section one hundred and
eighty-four; fifty per centum of such total value in the case of articles enumerated
in section one hundred and eighty-five; and twenty-five per centum in the case of
articles enumerated in section one hundred and eighty-six . . . .

The questions presented herein actually revolve around the nature or characteristic of
the above-mentioned bank premium, that is whether said bank charge falls under the
category of the charges enumerated in Art. 183-(B) of the Tax Code as included in the
taxable value of imported goods and, therefore, must be declared for tax purposes. This
case is not one of first impression to this Court, because in our decision in the case of
Genato Commercial Corporation vs. The Court of Tax Appeals, et al., 104 Phil., 615; 55
Off. Gaz. (12), 2092 the same issue was resolved, thus:

As may be seen, an importer is required to pay in advance the necessary

percentage tax on the articles imported "based on the import invoice value
thereof, certified to as correct by the Philippine Consul at the port of origin if there
is any, including freight, postage, insurance, commission, customs duty, and all
similar charges." In other words, the law requires that it be included in the
assessment not only the import invoice value of merchandise, which includes
freight, postage, insurance, commission, and customs duty, but all other similar
charges which would necessarily increase the landed cost of the merchandise
imported, which, in our opinion, should include the difference of P0.015 paid by
petitioner to a local bank in the purchase of foreign exchange to carry out the
importation. Indeed, the intention of Congress in enacting the above-quoted
provision is to include in the assessment all charges, whether specified or
otherwise, which an importer has to pay to complete his importation.

Invoking the rule of ejusdem generis which provides that "where, in a statute,
general words follow a designation of particular subjects or classes of persons,
the meaning of the general words will ordinarily be presumed to be restricted by
 the particular designation, class or nature as those specifically enumerated,"
petitioner contends that the difference of P0.015 which it paid to a local bank in
the purchase of foreign exchange to cover the importation in question cannot be
included in the assessment for the purpose of determining the advance sales tax
because they are not similar to the charges specifically enumerated in the law.

With this we disagree, for it cannot be denied that the intention of the law is to
include all charges that may be paid by the importer to bring the importation into
the country. In other words, all items of expense that may be incurred by the
importer in bringing the importation into the country and which would necessarily
increase the landed cost must be deemed included in the phrase "all similar
charges" mentioned in the law. The doctrine of ejusdem generis is but a rule of
construction adopted as an aid to ascertain and give effect to the legislative
intent when that intent is uncertain or ambiguous, but the same should not be
given such wide application that would operate to defeat the purpose of the law.
In other words, the doctrine is not of universal application. Its application must
yield to the manifest intent of Congress (State vs. Prather, 21 L.R.A. 23, 25)

But it is contended that, even assuming that the difference of P0.015 paid by the
petitioner be considered as a proper charge to be included in the assessment of
the advance sales tax, still the same should be deemed as covered and
absorbed by the corresponding mark-up prescribed by law. This contention is
erroneous as being contrary to the clear import of the law. Thus, the law requires
that the importer should pay the advance sales tax based on the import invoice
value of the merchandise, including those charges therein enumerated, plus one
hundred per centum of such total value in the case of articles enumerated in
section one hundred and eighty-four; fifty per centum in case of articles
enumerated in section one hundred and eighty-five; and twenty-five per centum
in the case of articles enumerated in section one hundred and eighty-six." In
other words, the mark-up prescribed by law is to be considered in addition to the
invoice value and all incidental expenses of importation.

There is no dispute that in the Parity Exchange Law (Republic Act No. 77) the
legal rate of exchange is P2.00 for every U. S. dollar and that this rate has
always been maintained by the government through various proclamations of the
President of the Philippines, but the existence of such legal rate does not
preclude the government from including in the landed cost the difference paid by
the importer in the purchase of foreign exchange if such difference has actually
been paid in carrying out the importation. The importer could have paid the legal
rate in purchasing the foreign exchange but if he chooses to pay a different rate
he should declare the difference for that goes to increase the cost in completing
the importation.

As an additional argument not urged in the Genato case, appellant herein cites the
change in the wording of the law as an indication of the intention of Congress to limit the
meaning of the phrase "all similar charges." Before Section 183-(B) of the National
Internal Revenue Code was first amended by Republic Act 594 on February 16, 1951, it
provided that the tax was imposed on imported articles "based on the total value thereof
at the time they are received by the importer, including freight, postage, insurance,
commission, customs duty, and all similar charges." Republic Act No. 594 amended the
section so that the tax on imported articles shall be "based on the import invoice value
thereof, certified to as correct by the Philippine Consul at the port of origin if there is
any, including freight, postage, insurance, commission, customs duty, and all similar
charges." Ascribing undue import to this amendment, counsel for appellant argues:"
Though we might concede that the term 'total value' in the provision just quoted could
be interpreted to include the premiums that banks charged the importers for opening
letters of credit, we cannot subscribe to the proposition suggested by the Court of Tax
Appeals that the term 'import invoice value', which Republic Act 594 introduced in lieu of
the term 'total' value, can be so interpreted. For to admit the correctness of said pro
position is to entirely render meaningless the deletion of the term 'total value' and the
insertion in its stead of the term 'import invoice value' accomplished by Republic Act
594."

The inference sought to be drawn by appellant from this change in the law is unjustified.
Whether we interpret the phrase "all similar charges" as component part of and
therefore already included in the "total value therefore", as appellant seems to accept,
or we merely add "all similar charges" as a separate item to "the import invoice value
thereof", as the present law provides, the result will be the same: the tax is to be based
upon the total landed cost of the imported articles, as pointed out in the Genato case.

Appellant herein further assails the legality of the assessment because, it is claimed,
retroactive effect is being given to the ruling of the Collector of June 21, 1954 which is
void for lack of approval by the Secretary of Finance, and is made to apply to
transactions long closed in the books of the taxpayer. We find no merit in this
contention. As the Court of Tax Appeals has rightly said "The validity or invalidity of the
ruling of respondent of June 21, 1954 is not material to this case. What is material here
is the correctness of respondent's decision of November 4, 1955, which is the decision
appealed from. (See par. 3, Petition for Review.) Even if the ruling of June 21, 1954 is
invalid for lack of approval of the Secretary of Finance, upon which we do not here
express an opinion, it would not affect the correctness of the decision of November 4,
1955, which we have found to be in accordance with Section 183-(B) of the Revenue
Code."

As to the claim that transactions long closed in the books of the taxpayer can no longer
be examined for the purpose of making a reassessment, suffice it to say that the
underassessment of the total landed value of the imported merchandise was brought
about by the importer's failure to add to the aforesaid landed value the premium
collected by the bank on foreign exchange transactions. Hence, the same remained
undetected until later when, in connection with its claim for credit for overpaid sales tax,
the taxpayer's record was investigated. Moreover, even granting arguendo that the tax
agent's inability to make the correct assessment reflected against their efficiency or
ability, such fact alone does not preclude the Government from effecting a corrected
assessment upon discovery of the error. As this court has explicitly ruled:

If in assessing income tax (or other kinds of tax) upon the return of the taxpayer,
an error is made with the result that the tax is underassessed, the Collector has
the power to reassess and collect any additional tax upon the returns for said
years, even after the death of the taxpayer. The government is not estopped by
error or mistake on the part of its agents (Pineda vs. Court of First Instance of
Tayabas, et al., 52 Phil., 803).
This of course understood to be without prejudice to the defense of prescription
inappropriate cases.

Wherefore, the decision of the Court of Tax Appeals being an accordance with the
evidence and the applicable law, the same is hereby affirmed, with costs against the
appellant. It is so ordered.

Paras, C.J., Bengzon, Padilla, Montemayor, Bautista Angelo, Concepcion and

Endencia, JJ., concur.

G.R. No. 106724 February 9, 1994

THE NATIONAL POLICE COMMISSION, represented by its Acting Chairman, Cesar

Sarino, Teodolo C. Natividad, Vice-Chairman and Executive Officer, Brig. Gen.
Virgilio H. David, Edgar Dula Torre, Guillermo P. Enriquez, Commissioners, and
Chief Supt. Levy D. Macasiano Director for Personnel, petitioners,
vs.
Honorable Judge Salvador de Guzman, Jr., Chief Supt. Norberto M. Lina, Chief
Supt. Ricardo Trinidad, Jr., Sr. Supt. Manuel Suarez, Supt. Justito B. Tagum, Sr.
Supt. Tranquilino Aspiras, Sr., Supt. Ramon I. Navarro,
Sr. Supt. Ramon I. Navarro, Sr. Supt. Jose P. Suria, Sr. Supt. Agaton Abiera, Chief
Insp. Bienvenido Torres, and the National (ROTC) Alumni Association Inc.
(NARRA), represented by its President Col. Benjamin Gundran, and Director
Hermogenes Peralta, Jr., respondents.

The Solicitor General for petitioners.

Renecio R. Espiritu for private respondents.

Diosdado P. Peralta for respondent-intervenor.

BIDIN, J.:

The case at bar had its origin in the implementation of the compulsory retirement of PNP
officers as mandated in Sec. 39, RA 6975, otherwise known as "An Act Establishing the
Philippine National Police Under a Reorganized Department of the Interior and Local
Government", which took effect on
January 2, 1991. Among others, RA 6975 provides for a uniform retirement system for
PNP members. Section 39 thereof reads:

Sec. 39. Compulsory Retirement. — Compulsory retirement, for officer and

non-officer, shall be upon the attainment of age fifty-six (56); Provided, That,
 in case of any officer with the rank of chief superintendent, director or deputy
director general, the Commission may allow his retention in the service for
an unextendible period of one (1) year.

Based on the above provision, petitioners sent notices of retirement to private

respondents who are all members of the defunct Philippine Constabulary and have
reached the age of fifty-six (56).

In response, private respondents filed a complaint on December 19, 1991 for declaratory
relief with prayer for the issuance of an ex parte restraining order and/or injunction
(docketed as Civil Case No. 91-3498) before the Regional Trial Court of Makati, Branch
142. In their complaint, respondents aver that the age of retirement set at fifty-six (56) by
Section 39 of RA 6975 cannot be applied to them since they are also covered by Sec. 89
thereof which provides:

Any provision hereof to the contrary notwithstanding, and within the

transition period of four (4) years following the effectivity of this Act, the
following members of the INP shall be considered compulsorily retired:

a) Those who shall attain the age of sixty (60) on the first year of the
effectivity of this Act.

b) Those who shall attain the age of fifty-nine (59) on the second year of the
effectivity of this Act.

c) Those who shall attain the age of fifty-eight (58) on the third year of the
effectivity of this Act.

d) Those who shall attain the age of fifty-seven (57) on the fourth year of
the effectivity of this Act.

It is the submission of respondents that the term "INP" includes both the former members
of the Philippine Constabulary and the local police force who were earlier constituted as
the Integrated National Police (INP) by virtue of
PD 765 in 1975.

On the other hand, it is the belief of petitioners that the 4-year transition period provided
in Section 89 applies only to the local police forces who previously retire, compulsorily, at
age sixty (60) for those in the ranks of Police/Fire Lieutenant or higher (Sec. 33, PD 1184);
while the retirement age for the PC had already been set at fifty-six (56) under the AFP
law.

On December 23, 1991, respondent judge issued a restraining order followed by a writ of
injunction on January 8, 1992 upon posting of a P100,000.00 bond by private
respondents.

After the parties have submitted their respective pleadings, the case was submitted for
resolution and on August 14, 1992, the respondent judge rendered the assailed decision,
the decretal portion of which reads:
 WHEREFORE, the court hereby declares that the term "INP" in Section 89
of the PNP Law includes all members of the present Philippine National
Police, irrespective of the original status of the present members of the
Philippine National Police before its creation and establishment, and that
Section 39 thereof shall become operative after the lapse of the
four-year transition period.

The preliminary injunction issued is made permanent.

SO ORDERED. (Rollo, pp. 29-30)

Petitioners filed the instant petition on October 8, 1992 seeking the reversal of the above
judgment. On January 12, 1993, the Court resolved to treat the respondents' Comment
as Answer and gave due course to the petition.

In ruling in favor of private respondents, respondent judge observed, among others, that:

It may have been the intention of Congress to refer to the local police forces
as the "INP" but the PNP Law failed to define who or what constituted the
INP. The natural recourse of the court is to trace the source of the "INP" as
courts are permitted to look to prior laws on the same subject and to
investigate the antecedents involved. There is nothing extant in the statute
books except that which was created and established under
PD 765 pursuant to the mandate of Article XV of the 1973 Constitution
providing that the "State shall establish and maintain an integrated national
police force whose organization, administration and operation shall be
provided by law." Heretofore, INP was unknown. And the said law
categorically declared the PC "as the principal component of the Integrated
National Police" (Sec. 5, PD 765).

The court was supplied by respondents (petitioners herein) with excerpts

taken from the discussion amongst the members of Congress concerning
the particular provision of Section 89. The court is not persuaded by said
discussion; it was a simple matter for the members of the legislature to state
precisely in clear and unequivocal terms their meaning, such as "integrated
police" as used in PD 765. Instead, they employed "INP", a generic term
that includes the PC as the principal component of the INP, supra. In failing
to categorically restrict the application of Section 89 as the members of
legislature are said to have intended, it gave rise to the presumption that it
has not limited nor intended to limit the meaning of the word when the bill
was finally passed into law. It is not difficult for the court to also presume
that in drafting the wording of the PNP Law, the legislators were aware of
the historical legislative origin of the "INP".

xxx xxx xxx

The court takes particular note of the fact that Section 89 is found in the
Transitory Provisions of the law which do not provide for any distinction
between the former PC officers and those belonging to the civilian police
forces. These provision are specifically enacted to regulate the period
 covering the dissolution of the PC and the creation of the PNP, a period that
necessarily would be attended by imbalances and or confusion occasioned
by the wholesale and mass integration. In fact, the retirement payment
scheme of the INP is still to be formulated, leaving the impression that
nothing is really settled until after the transition of four years has lapsed.
Section 89 therefore prevails over Section 39 up to the year 1995 when the
retirement age for the members of the PNP shall then be age 56; after the
year 1995, Section 39 shall then be the applicable law on retirement of PNP
members. (Rollo, pp. 27-28; emphasis supplied)

Petitioners disagree and claim that the use of the term INP in Sec. 89 does not imply the
same meaning contemplated under PD 765 wherein it is provided:

Sec. 1. Constitution of the Integrated National Police. — There is hereby

established and constituted the Integrated National Police (INP) which shall
be composed of the Philippine Constabulary as the nucleus, and the
integrated police forces as established by Presidential Decrees
Nos. 421, 482, 531, 585 and 641, as components, under the Department of
National Defense.

On the other hand, private respondents assert that being the nucleus of the Integrated
National Police (INP) under PD 765, former members of the Philippine Constabulary (PC)
should not be discriminated against from the coverage of the term "INP" in Sec. 89, RA
6975. Clearly, it is argued, the term "INP" found in Section 89 of RA 6975 refers to the
INP in PD 765. Thus, where the law does not distinguish, the courts should not
distinguish.

Does the law, RA 6975, distinguish INP from the PC? Petitioners submit that it does and
cite Sections 23 and 85 to stress the point, viz.:

Sec. 23. Composition. — Subject to the limitations provided for in this Act, the Philippine
National Police, hereinafter referred to as the PNP, is hereby established, initially consisting of
the members of the police forces who were integrated into the Integrated National Police (INP)
pursuant to Presidential Decree No. 765, and the officers and enlisted personnel of the
Philippine Constabulary (PC). . .

xxx xxx xxx

The permanent civilian employees of the present PC, INP, Narcotics

Command, CIS and the technical command of the AFP assigned with the
PC, including NAPOLCOM hearing officers holding regular items as such,
shall be absorbed by the Department as employees thereof, subject to
existing laws and regulations.

xxx xxx xxx

Sec. 85. Phase of Implementation. — The implementation of this Act shall

be undertaken in three (3) phases, to wit:
 Phase I — Exercise of option by the uniformed members of the Philippine
Constabulary, the PC elements assigned with the Narcotics Command,
CIS, and the personnel of the technical services of the AFP assigned with
the PC to include the regular CIS investigating agents and the operatives
and agents of the NAPOLCOM Inspection, Investigation and Intelligence
Branch, and the personnel of the absorbed National Action Committee on
Anti-Hijacking (NACAH) of the Department of National Defense, to be
completed within six (6) months from the date of the effectivity of this Act.
At the end of this phase, all personnel from the INP, PC, technical Services,
NACAH, and NAPOLCOM Inspection, Investigation and Intelligence Branch
shall have been covered by official orders assigning them to the PNP . . .

xxx xxx xxx

. . . Any PC-INP officer or enlisted personnel may, within the twelve-month

period from the effectivity of this Act, retire . . .

Phase III — . . . To accomplish the tasks of Phase III, the Commission shall
create a Board of Officers composed of the following: NAPOLCOM
Commissioner as Chairman and one (1) representative each from the PC,
INP, Civil Service Commission and the Department of Budget and
Management.

Section 86 of the same law further provides:

Sec. 86. Assumption by the PNP of Police Functions. — The PNP shall
absorb the functions of the PC, the INP and the Narcotics Command upon
the effectivity of this Act.

From a careful perusal of the above provisions, it appears therefore that the use of the
term INP is not synonymous with the PC. Had it been otherwise, the statute could have
just made a uniform reference to the members of the whole Philippine National Police
(PNP) for retirement purposes and not just the INP. The law itself distinguishes INP from
the PC and it cannot be construed that "INP" as used in Sec. 89 includes the members
of the PC.

And contrary to the pronouncement of respondent judge that the law failed to define who
constitutes the INP, Sec. 90 of RA 6975 has in fact defined the same. Thus,

Sec. 90. Status of Present NAPOLCOM, PC-INP. — Upon the effectivity of

this Act, the present National Police Commission and the Philippine
Constabulary-Integrated National Police shall cease to exist. The Philippine
Constabulary, which is the nucleus of the Philippine Constabulary-
Integrated National Police shall cease to be a major service of the Armed
Forces of the Philippines. The Integrated National Police, which is the
civilian component of the Philippine Constabulary-Integrated National
Police, shall cease to be the national police force and lieu thereof, a new
police force shall be established and constituted pursuant to this Act.
(emphasis supplied)
It is not altogether correct to state, therefore, that the legislature failed to define who the
members of the INP are. In this regard, it is of no moment that the legislature failed to
categorically restrict the application of the transition period in Sec. 89 specifically in favor
of the local police forces for it would be a mere superfluity as the PC component of the
INP was already retirable at age fifty-six (56).

Having defined the meaning of INP, the trial court need not have belabored on the
supposed dubious meaning of the term. Nonetheless, if confronted with such a situation,
courts are not without recourse in determining the construction of the statute with doubtful
meaning for they may avail themselves of the actual proceedings of the legislative body.
In case of doubt as to what a provision of a statute means, the meaning put to the
provision during the legislative deliberations may be adopted (De Villa v. Court of
Appeals,
195 SCRA 722 [1991] citing Palanca v. City of Manila, 41 Phil. 125 [1920]; Arenas v. City
of San Carlos, 82 SCRA 318 [1978]).

Courts should not give a literal interpretation to the letter of the law if it runs counter to the
legislative intent (Yellow Taxi and Pasay Transportation Workers' Association v. Manila
Yellow Taxi Cab. Co., 80 Phil. 83 [1948]).

Examining the records of the Bicameral Conference Committee, we find that the
legislature did intent to exclude the members of the PC from the coverage of Sec. 89
insofar as the retirement age is concerned, thus:

THE CHAIRMAN. (SEN. MACEDA). Well, it seems what people really want
is one common rule, so if it is fifty-six, fifty-six; of course, the PC wants sixty
for everybody. Of course, it is not acceptable to us in the sense that we tied
this up really to the question of: If you are lax in allowing their (the PC) entry
into the PNP, then tighten up the retirement. If we will be strict in, like
requiring examinations and other conditions for their original entry, then
since we have sifted out a certain amount of undesirables, then we can
allow a longer retirement age. That was the rationale, that was the tie-up.
Since we are relaxing the entry, we should speed up . . .

THE CHAIRMAN. (REP. GUTANG). Exit.

THE CHAIRMAN. (SEN. MACEDA) . . . the retirement, the exit.

THE CHAIRMAN. (REP. GUTANG). So let me get it very clear, Mr.

Chairman. Fifty-six, let's say, that will not make any adjustment in the PC
because there (they) are (retirable at age) fifty-six.

THE CHAIRMAN. (SEN. MACEDA). Kaya nga, wala na silang masasabi.

THE CHAIRMAN. (REP. GUTANG). In the case of the Police, since they
are retireable now at sixty, for the officers, it will be
applicable to them on a one-year every year basis for a total period of four
years transition. (Bicameral Conference Committee on National Defense,
March 12, 1990)
 REP. GUTANG. On the first year of effectivity, the police will retire at 60
years.

THE CHAIRMAN. (SEN. MACEDA). Sixty.

REP. GUTANG. On the second year, 59.

THE CHAIRMAN. (SEN. MACEDA). Oo.

REP. GUTANG. On the third year, 58.

THE CHAIRMAN. (SEN. MACEDA). Fifty-eight. So 'yung 55, on the third

year, 58, doon siya re-retire.

REP. GUTANG. Oo.

SEN. SAGUISAG. So kung 55, when the law becomes effective . . .

THE CHAIRMAN. (SEN. MACEDA). He will retire at 58, doon siya aabot.

REP. UNICO. Pwede.

SEN. SAGUISAG. Dahil 'yon, may time to . . .

THE CHAIRMAN. (SEN. MACEDA). Walang problema dito sa transition ng

pulis, acceptable ito, eh.

THE CHAIRMAN. (REP. COJUANGCO). Sa PC?

THE CHAIRMAN. (SEN. MACEDA). PC, walang mawawala sa kanila, 56

ang retirement age nilang talaga, eh. Kaya ayaw ko
ngang dagdagan 'yung 56 nila at 'yon din ang sa Armed Forces, 56. (Ibid.,
May 22, 1990)

In applying the provisions of Sec. 89 in favor of the local police force as established in PD
765, the Court does not, in any manner, give any
undue preferential treatment in favor of the other group. On the contrary, the Court is
merely giving life to the real intent of the legislators based on the deliberations of the
Bicameral Conference Committee that preceded the enactment of RA 6975.

The legislative intent to classify the INP in such manner that Section 89 of RA 6975 is
applicable only to the local police force is clear. The question now is whether the
classification is valid. The test for this is reasonableness such that it must conform to the
following requirements: (1) It must be based upon substantial distinctions; (2) It must be
germane to the purpose of the law; (3) It must not be limited to existing conditions only;
(4) It must apply equally to all members of the same class (People vs. Cayat, 68 Phil. 12
[1939]).

The classification is based upon substantial distinctions. The PC, before the effectivity of
the law (RA 6975), were already retirable at age 56 while the local police force were
retirable at 60, and governed by different laws
(P.D. 1184, Sec. 33 and Sec. 50). The distinction is relevant for the purpose of the statute,
which is to enable the local police force to plan for their retirement which would be earlier
than usual because of the new law. Section 89 is merely transitory, remedial in nature,
and loses its force and effect once the four-year transitory period has elapsed. Finally, it
applies not only to some but to all local police officers.

It may be appropriate to state at this point that it seems absurd that a law will grant an
extension to PC officers' retirable age from 56 to 60 and then gradually lower it back to
56 without any cogent reason at all. Why should the retirement age of PC officers be
increased during the transitory period to the exclusion of other PC officers who would
retire at age 56 after such period? Such absurdity was never contemplated by the law
and would defeat its purpose of providing a uniform retirement age for PNP members.

WHEREFORE, the petition is GRANTED. The writ of injunction issued on January 8, 1992
is hereby LIFTED and the assailed decision of respondent judge is REVERSED and SET
ASIDE.

SO ORDERED.

Narvasa, C.J., Cruz, Feliciano, Padilla, Regalado, Davide, Jr., Romero, Bellosillo, Melo,
Quiason, Puno, Vitug and Kapunan, JJ., concur.

Nocon, J., is on leave.

G.R. No. L-63915 April 24, 1985

LORENZO M. TAÑADA, ABRAHAM F. SARMIENTO, and MOVEMENT OF

ATTORNEYS FOR BROTHERHOOD, INTEGRITY AND NATIONALISM, INC.
[MABINI], petitioners,
vs.
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to the President,
HON. JOAQUIN VENUS, in his capacity as Deputy Executive Assistant to the
President , MELQUIADES P. DE LA CRUZ, in his capacity as Director, Malacañang
Records Office, and FLORENDO S. PABLO, in his capacity as Director, Bureau of
Printing, respondents.

ESCOLIN, J.:

Invoking the people's right to be informed on matters of public concern, a right

recognized in Section 6, Article IV of the 1973 Philippine Constitution, 1 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.
Specifically, the publication of the following presidential issuances is sought:

a] Presidential Decrees Nos. 12, 22, 37, 38, 59, 64, 103, 171, 179, 184,
197, 200, 234, 265, 286, 298, 303, 312, 324, 325, 326, 337, 355, 358,
359, 360, 361, 368, 404, 406, 415, 427, 429, 445, 447, 473, 486, 491,
503, 504, 521, 528, 551, 566, 573, 574, 594, 599, 644, 658, 661, 718,
731, 733, 793, 800, 802, 835, 836, 923, 935, 961, 1017-1030, 1050, 1060-
1061, 1085, 1143, 1165, 1166, 1242, 1246, 1250, 1278, 1279, 1300,
1644, 1772, 1808, 1810, 1813-1817, 1819-1826, 1829-1840, 1842-1847.

b] Letter of Instructions Nos.: 10, 39, 49, 72, 107, 108, 116, 130, 136, 141,
150, 153, 155, 161, 173, 180, 187, 188, 192, 193, 199, 202, 204, 205,
209, 211-213, 215-224, 226-228, 231-239, 241-245, 248, 251, 253-261,
263-269, 271-273, 275-283, 285-289, 291, 293, 297-299, 301-303, 309,
312-315, 325, 327, 343, 346, 349, 357, 358, 362, 367, 370, 382, 385, 386,
396-397, 405, 438-440, 444- 445, 473, 486, 488, 498, 501, 399, 527, 561,
576, 587, 594, 599, 600, 602, 609, 610, 611, 612, 615, 641, 642, 665,
702, 712-713, 726, 837-839, 878-879, 881, 882, 939-940, 964,997,1149-
1178,1180-1278.

c] General Orders Nos.: 14, 52, 58, 59, 60, 62, 63, 64 & 65.

d] Proclamation Nos.: 1126, 1144, 1147, 1151, 1196, 1270, 1281, 1319-
1526, 1529, 1532, 1535, 1538, 1540-1547, 1550-1558, 1561-1588, 1590-
1595, 1594-1600, 1606-1609, 1612-1628, 1630-1649, 1694-1695, 1697-
1701, 1705-1723, 1731-1734, 1737-1742, 1744, 1746-1751, 1752, 1754,
1762, 1764-1787, 1789-1795, 1797, 1800, 1802-1804, 1806-1807, 1812-
1814, 1816, 1825-1826, 1829, 1831-1832, 1835-1836, 1839-1840, 1843-
1844, 1846-1847, 1849, 1853-1858, 1860, 1866, 1868, 1870, 1876-1889,
1892, 1900, 1918, 1923, 1933, 1952, 1963, 1965-1966, 1968-1984, 1986-
2028, 2030-2044, 2046-2145, 2147-2161, 2163-2244.

e] Executive Orders Nos.: 411, 413, 414, 427, 429-454, 457- 471, 474-
492, 494-507, 509-510, 522, 524-528, 531-532, 536, 538, 543-544, 549,
551-553, 560, 563, 567-568, 570, 574, 593, 594, 598-604, 609, 611- 647,
649-677, 679-703, 705-707, 712-786, 788-852, 854-857.

f] Letters of Implementation Nos.: 7, 8, 9, 10, 11-22, 25-27, 39, 50, 51, 59,
76, 80-81, 92, 94, 95, 107, 120, 122, 123.

g] Administrative Orders Nos.: 347, 348, 352-354, 360- 378, 380-433,

436-439.

The respondents, through the Solicitor General, would have this case dismissed outright
on the ground that petitioners have no legal personality or standing to bring the instant
petition. The view is submitted that in the absence of any showing that petitioners are
personally and directly affected or prejudiced by the alleged non-publication of the
presidential issuances in question 2 said petitioners are without the requisite legal
personality to institute this mandamus proceeding, they are not being "aggrieved
parties" within the meaning of Section 3, Rule 65 of the Rules of Court, which we quote:
 SEC. 3. Petition for Mandamus.—When any tribunal, corporation, board or
person unlawfully neglects the performance of an act which the law
specifically enjoins as a duty resulting from an office, trust, or station, or
unlawfully excludes another from the use a rd enjoyment of a right or
office to which such other is entitled, and there is no other plain, speedy
and adequate remedy in the ordinary course of law, the person aggrieved
thereby may file a verified petition in the proper court alleging the facts
with certainty and praying that judgment be rendered commanding the
defendant, immediately or at some other specified time, to do the act
required to be done to Protect the rights of the petitioner, and to pay the
damages sustained by the petitioner by reason of the wrongful acts of the
defendant.

Upon the other hand, petitioners maintain that since the subject of the petition concerns
a public right and its object is to compel the performance of a public duty, they need not
show any specific interest for their petition to be given due course.

The issue posed is not one of first impression. As early as the 1910 case of Severino
vs. Governor General, 3 this Court held that while 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," and "it is for the
public officers exclusively to apply for the writ when public rights are to be subserved
[Mithchell vs. Boardmen, 79 M.e., 469]," 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 [High, Extraordinary Legal Remedies, 3rd ed.,
sec. 431].

Thus, in said case, this Court recognized the relator Lope Severino, a private individual,
as a proper party to the mandamus proceedings brought to compel the Governor
General to call a special election for the position of municipal president in the town of
Silay, Negros Occidental. Speaking for this Court, Mr. Justice Grant T. Trent said:

We are therefore of the opinion that the weight of authority supports the
proposition that the relator is a proper party to proceedings of this
character when a public right is sought to be enforced. If the general rule
in America were otherwise, we think that it would not be applicable to the
case at bar for the reason 'that it is always dangerous to apply a general
rule to a particular case without keeping in mind the reason for the rule,
because, if under the particular circumstances the reason for the rule does
not exist, the rule itself is not applicable and reliance upon the rule may
well lead to error'

No reason exists in the case at bar for applying the general rule insisted
upon by counsel for the respondent. The circumstances which surround
this case are different from those in the United States, inasmuch as if the
relator is not a proper party to these proceedings no other person could
 be, as we have seen that it is not the duty of the law officer of the
Government to appear and represent the people in cases of this
character.

The reasons given by the Court in recognizing a private citizen's legal personality in the
aforementioned case apply squarely to the present petition. Clearly, the right sought to
be enforced by petitioners herein is a public right recognized by no less than the
fundamental law of the land. If petitioners were not allowed to institute this proceeding, it
would indeed be difficult to conceive of any other person to initiate the same,
considering that the Solicitor General, the government officer generally empowered to
represent the people, has entered his appearance for respondents in this case.

Respondents further contend that publication in the Official Gazette is not a sine qua
non requirement for the effectivity of laws where the laws themselves provide for their
own effectivity dates. It is thus submitted that since the presidential issuances in
question contain special provisions as to the date they are to take effect, publication in
the Official Gazette is not indispensable for their effectivity. The point stressed is
anchored on Article 2 of the Civil Code:

Art. 2. Laws shall take effect after fifteen days following the completion of
their publication in the Official Gazette, unless it is otherwise provided, ...

The interpretation given by respondent is in accord with this Court's construction of said
article. In a long line of decisions,4 this Court has ruled that publication 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.

Respondents' argument, however, is logically correct only insofar as it equates the

effectivity of laws with the fact of publication. Considered in the light of other statutes
applicable to the issue at hand, the conclusion is easily reached that said Article 2 does
not preclude the requirement of publication in the Official Gazette, even if the law itself
provides for the date of its effectivity. Thus, Section 1 of Commonwealth Act 638
provides as follows:

Section 1. There shall be published in the Official Gazette [1] all important
legisiative acts and resolutions of a public nature of the, Congress of the
Philippines; [2] all executive and administrative orders and proclamations,
except such as have no general applicability; [3] decisions or abstracts of
decisions of the Supreme Court and the Court of Appeals as may be
deemed by said courts of sufficient importance to be so published; [4]
such documents or classes of documents as may be required so to be
published by law; and [5] such documents or classes of documents as the
President of the Philippines shall determine from time to time to have
general applicability and legal effect, or which he may authorize so to be
published. ...

The clear object of the above-quoted 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.

Perhaps at no time since the establishment of the Philippine Republic has the
publication of laws taken so vital significance that at this time 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. As the Supreme Court of
Spain ruled: "Bajo la denominacion generica de leyes, se comprenden tambien los
reglamentos, Reales decretos, Instrucciones, Circulares y Reales ordines dictadas de
conformidad con las mismas por el Gobierno en uso de su potestad.5

The very first clause of Section I of Commonwealth Act 638 reads: "There shall be
published in the Official Gazette ... ." The word "shall" used therein imposes upon
respondent officials 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. Such listing, to our mind, leaves respondents with no discretion whatsoever as
to what must be included or excluded from such publication.

The publication of all presidential issuances "of a public nature" or "of general
applicability" is mandated by law. Obviously, presidential decrees that provide for fines,
forfeitures or penalties for their violation or otherwise impose a burden or. 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. 6

It is needless to add that 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. As Justice Claudio Teehankee said in Peralta vs. COMELEC 7:

In a time of proliferating decrees, orders and letters of instructions which

all form part of the law of the land, the requirement of due process and the
Rule of Law demand that the Official Gazette as the official government
repository promulgate and publish the texts of all such decrees, orders
and instructions so that the people may know where to obtain their official
and specific contents.

The Court therefore declares that presidential issuances of general application, which
have not been published, shall have no force and effect. Some members of the Court,
quite apprehensive about the possible unsettling effect this decision might have on acts
done in reliance of the validity of those presidential decrees which were published only
during the pendency of this petition, have put the question as to whether the Court's
declaration of invalidity apply to P.D.s which had been enforced or implemented prior to
their publication. The answer is all too familiar. In similar situations in the past this Court
had taken the pragmatic and realistic course set forth in Chicot County Drainage District
vs. Baxter Bank 8 to wit:

The courts below have proceeded on 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,
118 U.S. 425, 442; Chicago, 1. & L. Ry. Co. v. Hackett, 228 U.S. 559, 566.
It is quite clear, however, that 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, state and federal and it
is manifest from numerous decisions that an all-inclusive statement of a
principle of absolute retroactive invalidity cannot be justified.

Consistently with the above principle, this Court in Rutter vs. Esteban 9 sustained the
right of a party under the Moratorium Law, albeit said right had accrued in his favor
before said law was declared unconstitutional by this Court.

Similarly, 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."

From the report submitted to the Court by the Clerk of Court, it appears that of the
presidential decrees sought by petitioners to be published in the Official Gazette, only
Presidential Decrees Nos. 1019 to 1030, inclusive, 1278, and 1937 to 1939, inclusive,
have not been so published. 10 Neither the subject matters nor the texts of these PDs
can be ascertained since no copies thereof are available. But whatever their subject
matter may be, it is undisputed that none of these unpublished PDs has ever been
implemented or enforced by the government. In Pesigan vs. Angeles, 11 the Court,
through Justice Ramon Aquino, ruled that "publication is necessary to apprise the public
of the contents of [penal] regulations and make the said penalties binding on the
persons affected thereby. " The cogency of this holding is apparently recognized by
respondent officials considering the manifestation in their comment that "the
government, as a matter of policy, refrains from prosecuting violations of criminal laws
until the same shall have been published in the Official Gazette or in some other
publication, even though some criminal laws provide that they shall take effect
immediately.

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

SO ORDERED.

Relova, J., concurs.

Aquino, J., took no part.

Concepcion, Jr., J., is on leave.

Separate Opinions

FERNANDO, C.J., concurring (with qualification):

There is on the whole acceptance on my part of the views expressed in the ably written
opinion of Justice Escolin. I am unable, however, to concur insofar as it would
unqualifiedly impose the requirement of publication in the Official Gazette for
unpublished "presidential issuances" to have binding force and effect.

I shall explain why.

1. It is of course true that without the requisite publication, a due process question
would arise if made to apply adversely to a party who is not even aware of the existence
of any legislative or executive act having the force and effect of law. My point is that
such publication required need not be confined to the Official Gazette. From the
pragmatic standpoint, there is an advantage to be gained. It conduces to certainty. That
is too be admitted. It does not follow, however, that failure to do so would in all cases
and under all circumstances result in a statute, presidential decree or any other
executive act of the same category being bereft of any binding force and effect. To so
hold would, for me, raise a constitutional question. Such a pronouncement would lend
itself to the interpretation that such a legislative or presidential act is bereft of the
attribute of effectivity unless published in the Official Gazette. There is no such
requirement in the Constitution as Justice Plana so aptly pointed out. It is true that what
is decided now applies only to past "presidential issuances". Nonetheless, this
clarification is, to my mind, needed to avoid any possible misconception as to what is
required for any statute or presidential act to be impressed with binding force or
effectivity.
2. It is quite understandable then why I concur in the separate opinion of Justice Plana.
Its first paragraph sets forth what to me is the constitutional doctrine applicable to this
case. Thus: "The Philippine Constitution does not require the publication of laws as a
prerequisite for their effectivity, unlike some Constitutions elsewhere. It may be said
though that the guarantee of due process requires notice of laws to affected Parties
before they can be bound thereby; but such notice is not necessarily by publication in
the Official Gazette. The due process clause is not that precise. 1 I am likewise in
agreement with its closing paragraph: "In fine, I concur in the majority decision to the
extent that it requires notice before laws become effective, for no person should be
bound by a law without notice. This is elementary fairness. However, I beg to disagree
insofar as it holds that such notice shall be by publication in the Official Gazette. 2

3. It suffices, as was stated by Judge Learned Hand, that law as the command of the
government "must be ascertainable in some form if it is to be enforced at all. 3 It would
indeed be to reduce it to the level of mere futility, as pointed out by Justice Cardozo, "if
it is unknown and unknowable. 4 Publication, to repeat, is thus essential. What I am not
prepared to subscribe to is the doctrine that it must be in the Official Gazette. To be
sure once published therein there is the ascertainable mode of determining the exact
date of its effectivity. Still for me that does not dispose of the question of what is the
jural effect of past presidential decrees or executive acts not so published. For prior
thereto, it could be that parties aware of their existence could have conducted
themselves in accordance with their provisions. If no legal consequences could attach
due to lack of publication in the Official Gazette, then serious problems could arise.
Previous transactions based on such "Presidential Issuances" could be open to
question. Matters deemed settled could still be inquired into. I am not prepared to hold
that such an effect is contemplated by our decision. Where such presidential decree or
executive act is made the basis of a criminal prosecution, then, of course, its ex post
facto character becomes evident. 5 In civil cases though, retroactivity as such is not
conclusive on the due process aspect. There must still be a showing of arbitrariness.
Moreover, where the challenged presidential decree or executive act was issued under
the police power, the non-impairment clause of the Constitution may not always be
successfully invoked. There must still be that process of balancing to determine whether
or not it could in such a case be tainted by infirmity. 6 In traditional terminology, there
could arise then a question of unconstitutional application. That is as far as it goes.

4. Let me make therefore that my qualified concurrence goes no further than to affirm
that publication is essential to the effectivity of a legislative or executive act of a general
application. I am not in agreement with the view that such publication must be in the
Official Gazette. The Civil Code itself in its Article 2 expressly recognizes that the rule
as to laws taking effect after fifteen days following the completion of their publication in
the Official Gazette is subject to this exception, "unless it is otherwise provided."
Moreover, the Civil Code is itself only a legislative enactment, Republic Act No. 386. It
does not and cannot have the juridical force of a constitutional command. A later
legislative or executive act which has the force and effect of law can legally provide for a
different rule.

5. Nor can I agree with the rather sweeping conclusion in the opinion of Justice Escolin
that presidential decrees and executive acts not thus previously published in the Official
Gazette would be devoid of any legal character. That would be, in my opinion, to go too
far. It may be fraught, as earlier noted, with undesirable consequences. I find myself
therefore unable to yield assent to such a pronouncement.

I am authorized to state that Justices Makasiar, Abad Santos, Cuevas, and Alampay
concur in this separate opinion.

Makasiar, Abad Santos, Cuevas and Alampay, JJ., concur.

TEEHANKEE, J., concurring:

I concur with the main opinion of Mr. Justice Escolin and the concurring opinion of Mme.
Justice Herrera. The Rule of Law connotes a body of norms and laws published and
ascertainable and of equal application to all similarly circumstances and not subject to
arbitrary change but only under certain set procedures. The Court has consistently
stressed that "it is an elementary rule of fair play and justice that a reasonable
opportunity to be informed must be afforded to the people who are commanded to obey
before they can be punished for its violation,1 citing the settled principle based on due
process enunciated in earlier cases that "before the public is bound by its contents,
especially its penal provisions, a law, regulation or circular must first be published and
the people officially and specially informed of said contents and its penalties.

Without official publication in the Official Gazette as required by Article 2 of the Civil
Code and the Revised Administrative Code, there would be no basis nor justification for
the corollary rule of Article 3 of the Civil Code (based on constructive notice that the
provisions of the law are ascertainable from the public and official repository where they
are duly published) that "Ignorance of the law excuses no one from compliance
therewith.

Respondents' contention based on a misreading of Article 2 of the Civil Code that "only
laws which are silent as to their effectivity [date] need be published in the Official
Gazette for their effectivity" is manifestly untenable. The plain text and meaning of the
Civil Code is that "laws shall take effect after fifteen days following the completion of
their publication in the Official Gazette, unless it is otherwise provided, " i.e. a different
effectivity date is provided by the law itself. This proviso perforce refers to a law that has
been duly published pursuant to the basic constitutional requirements of due process.
The best example of this is the Civil Code itself: the same Article 2 provides otherwise
that it "shall take effect [only] one year [not 15 days] after such publication. 2 To sustain
respondents' misreading that "most laws or decrees specify the date of their effectivity
and for this reason, publication in the Official Gazette is not necessary for their
effectivity 3 would be to nullify and render nugatory the Civil Code's indispensable and
essential requirement of prior publication in the Official Gazette by the simple expedient
of providing for immediate effectivity or an earlier effectivity date in the law itself before
the completion of 15 days following its publication which is the period generally fixed by
the Civil Code for its proper dissemination.

MELENCIO-HERRERA, J., concurring:

I agree. There cannot be any question but that even if a decree provides for a date of
effectivity, it has to be published. What I would like to state in connection with that
proposition is that when a date of effectivity is mentioned in the decree but the decree
becomes effective only fifteen (15) days after its publication in the Official Gazette, it will
not mean that the decree can have retroactive effect to the date of effectivity mentioned
in the decree itself. There should be no retroactivity if the retroactivity will run counter to
constitutional rights or shall destroy vested rights.

PLANA, J., concurring (with qualification):

The Philippine Constitution does not require the publication of laws as a prerequisite for
their effectivity, unlike some Constitutions elsewhere. * It may be said though that the
guarantee of due process requires notice of laws to affected parties before they can be
bound thereby; but such notice is not necessarily by publication in the Official Gazette.
The due process clause is not that precise. Neither is the publication of laws in the
Official Gazette required by any statute as a prerequisite for their effectivity, if said laws
already provide for their effectivity date.

Article 2 of the Civil Code provides that "laws shall take effect after fifteen days following
the completion of their publication in the Official Gazette, unless it is otherwise provided
" Two things may be said of this provision: Firstly, it obviously does not apply to a law
with a built-in provision as to when it will take effect. Secondly, it clearly recognizes that
each law may provide not only a different period for reckoning its effectivity date but
also a different mode of notice. Thus, a law may prescribe that it shall be published
elsewhere than in the Official Gazette.

Commonwealth Act No. 638, in my opinion, does not support the proposition that for
their effectivity, laws must be published in the Official Gazette. The said law is simply
"An Act to Provide for the Uniform Publication and Distribution of the Official Gazette."
Conformably therewith, it authorizes the publication of the Official Gazette, determines
its frequency, provides for its sale and distribution, and defines the authority of the
Director of Printing in relation thereto. It also enumerates what shall be published in the
Official Gazette, among them, "important legislative acts and resolutions of a public
nature of the Congress of the Philippines" and "all executive and administrative orders
and proclamations, except such as have no general applicability." It is noteworthy that
not all legislative acts are required to be published in the Official Gazette but only
"important" ones "of a public nature." Moreover, the said law does not provide that
publication in the Official Gazette is essential for the effectivity of laws. This is as it
should be, for all statutes are equal and stand on the same footing. A law, especially an
earlier one of general application such as Commonwealth Act No. 638, cannot nullify or
restrict the operation of a subsequent statute that has a provision of its own as to when
and how it will take effect. Only a higher law, which is the Constitution, can assume that
role.

In fine, I concur in the majority decision to the extent that it requires notice before laws
become effective, for no person should be bound by a law without notice. This is
elementary fairness. However, I beg to disagree insofar as it holds that such notice shall
be by publication in the Official Gazette.
Cuevas and Alampay, JJ., concur.

GUTIERREZ, Jr., J., concurring:

I concur insofar as publication is necessary but reserve my vote as to the necessity of

such publication being in the Official Gazette.

DE LA FUENTE, J., concurring:

I concur insofar as the opinion declares the unpublished decrees and issuances of a
public nature or general applicability ineffective, until due publication thereof.

Separate Opinions

FERNANDO, C.J., concurring (with qualification):

There is on the whole acceptance on my part of the views expressed in the ably written
opinion of Justice Escolin. I am unable, however, to concur insofar as it would
unqualifiedly impose the requirement of publication in the Official Gazette for
unpublished "presidential issuances" to have binding force and effect.

I shall explain why.

1. It is of course true that without the requisite publication, a due process question
would arise if made to apply adversely to a party who is not even aware of the existence
of any legislative or executive act having the force and effect of law. My point is that
such publication required need not be confined to the Official Gazette. From the
pragmatic standpoint, there is an advantage to be gained. It conduces to certainty. That
is too be admitted. It does not follow, however, that failure to do so would in all cases
and under all circumstances result in a statute, presidential decree or any other
executive act of the same category being bereft of any binding force and effect. To so
hold would, for me, raise a constitutional question. Such a pronouncement would lend
itself to the interpretation that such a legislative or presidential act is bereft of the
attribute of effectivity unless published in the Official Gazette. There is no such
requirement in the Constitution as Justice Plana so aptly pointed out. It is true that what
is decided now applies only to past "presidential issuances". Nonetheless, this
clarification is, to my mind, needed to avoid any possible misconception as to what is
required for any statute or presidential act to be impressed with binding force or
effectivity.
2. It is quite understandable then why I concur in the separate opinion of Justice Plana.
Its first paragraph sets forth what to me is the constitutional doctrine applicable to this
case. Thus: "The Philippine Constitution does not require the publication of laws as a
prerequisite for their effectivity, unlike some Constitutions elsewhere. It may be said
though that the guarantee of due process requires notice of laws to affected Parties
before they can be bound thereby; but such notice is not necessarily by publication in
the Official Gazette. The due process clause is not that precise. 1 I am likewise in
agreement with its closing paragraph: "In fine, I concur in the majority decision to the
extent that it requires notice before laws become effective, for no person should be
bound by a law without notice. This is elementary fairness. However, I beg to disagree
insofar as it holds that such notice shall be by publication in the Official Gazette. 2

3. It suffices, as was stated by Judge Learned Hand, that law as the command of the
government "must be ascertainable in some form if it is to be enforced at all. 3 It would
indeed be to reduce it to the level of mere futility, as pointed out by Justice Cardozo, "if
it is unknown and unknowable. 4 Publication, to repeat, is thus essential. What I am not
prepared to subscribe to is the doctrine that it must be in the Official Gazette. To be
sure once published therein there is the ascertainable mode of determining the exact
date of its effectivity. Still for me that does not dispose of the question of what is the
jural effect of past presidential decrees or executive acts not so published. For prior
thereto, it could be that parties aware of their existence could have conducted
themselves in accordance with their provisions. If no legal consequences could attach
due to lack of publication in the Official Gazette, then serious problems could arise.
Previous transactions based on such "Presidential Issuances" could be open to
question. Matters deemed settled could still be inquired into. I am not prepared to hold
that such an effect is contemplated by our decision. Where such presidential decree or
executive act is made the basis of a criminal prosecution, then, of course, its ex post
facto character becomes evident. 5 In civil cases though, retroactivity as such is not
conclusive on the due process aspect. There must still be a showing of arbitrariness.
Moreover, where the challenged presidential decree or executive act was issued under
the police power, the non-impairment clause of the Constitution may not always be
successfully invoked. There must still be that process of balancing to determine whether
or not it could in such a case be tainted by infirmity. 6 In traditional terminology, there
could arise then a question of unconstitutional application. That is as far as it goes.

4. Let me make therefore that my qualified concurrence goes no further than to affirm
that publication is essential to the effectivity of a legislative or executive act of a general
application. I am not in agreement with the view that such publication must be in the
Official Gazette. The Civil Code itself in its Article 2 expressly recognizes that the rule
as to laws taking effect after fifteen days following the completion of their publication in
the Official Gazette is subject to this exception, "unless it is otherwise provided."
Moreover, the Civil Code is itself only a legislative enactment, Republic Act No. 386. It
does not and cannot have the juridical force of a constitutional command. A later
legislative or executive act which has the force and effect of law can legally provide for a
different rule.

5. Nor can I agree with the rather sweeping conclusion in the opinion of Justice Escolin
that presidential decrees and executive acts not thus previously published in the Official
Gazette would be devoid of any legal character. That would be, in my opinion, to go too
far. It may be fraught, as earlier noted, with undesirable consequences. I find myself
therefore unable to yield assent to such a pronouncement.

I am authorized to state that Justices Makasiar, Abad Santos, Cuevas, and Alampay
concur in this separate opinion.

Makasiar, Abad Santos, Cuevas and Alampay, JJ., concur.

TEEHANKEE, J., concurring:

I concur with the main opinion of Mr. Justice Escolin and the concurring opinion of Mme.
Justice Herrera. The Rule of Law connotes a body of norms and laws published and
ascertainable and of equal application to all similarly circumstances and not subject to
arbitrary change but only under certain set procedures. The Court has consistently
stressed that "it is an elementary rule of fair play and justice that a reasonable
opportunity to be informed must be afforded to the people who are commanded to obey
before they can be punished for its violation,1 citing the settled principle based on due
process enunciated in earlier cases that "before the public is bound by its contents,
especially its penal provisions, a law, regulation or circular must first be published and
the people officially and specially informed of said contents and its penalties.

Without official publication in the Official Gazette as required by Article 2 of the Civil
Code and the Revised Administrative Code, there would be no basis nor justification for
the corollary rule of Article 3 of the Civil Code (based on constructive notice that the
provisions of the law are ascertainable from the public and official repository where they
are duly published) that "Ignorance of the law excuses no one from compliance
therewith.

Respondents' contention based on a misreading of Article 2 of the Civil Code that "only
laws which are silent as to their effectivity [date] need be published in the Official
Gazette for their effectivity" is manifestly untenable. The plain text and meaning of the
Civil Code is that "laws shall take effect after fifteen days following the completion of
their publication in the Official Gazette, unless it is otherwise provided, " i.e. a different
effectivity date is provided by the law itself. This proviso perforce refers to a law that has
been duly published pursuant to the basic constitutional requirements of due process.
The best example of this is the Civil Code itself: the same Article 2 provides otherwise
that it "shall take effect [only] one year [not 15 days] after such publication. 2 To sustain
respondents' misreading that "most laws or decrees specify the date of their effectivity
and for this reason, publication in the Official Gazette is not necessary for their
effectivity 3 would be to nullify and render nugatory the Civil Code's indispensable and
essential requirement of prior publication in the Official Gazette by the simple expedient
of providing for immediate effectivity or an earlier effectivity date in the law itself before
the completion of 15 days following its publication which is the period generally fixed by
the Civil Code for its proper dissemination.

MELENCIO-HERRERA, J., concurring:

I agree. There cannot be any question but that even if a decree provides for a date of
effectivity, it has to be published. What I would like to state in connection with that
proposition is that when a date of effectivity is mentioned in the decree but the decree
becomes effective only fifteen (15) days after its publication in the Official Gazette, it will
not mean that the decree can have retroactive effect to the date of effectivity mentioned
in the decree itself. There should be no retroactivity if the retroactivity will run counter to
constitutional rights or shall destroy vested rights.

PLANA, J., concurring (with qualification):

The Philippine Constitution does not require the publication of laws as a prerequisite for
their effectivity, unlike some Constitutions elsewhere. * It may be said though that the
guarantee of due process requires notice of laws to affected parties before they can be
bound thereby; but such notice is not necessarily by publication in the Official Gazette.
The due process clause is not that precise. Neither is the publication of laws in the
Official Gazette required by any statute as a prerequisite for their effectivity, if said laws
already provide for their effectivity date.

Article 2 of the Civil Code provides that "laws shall take effect after fifteen days following
the completion of their publication in the Official Gazette, unless it is otherwise provided
" Two things may be said of this provision: Firstly, it obviously does not apply to a law
with a built-in provision as to when it will take effect. Secondly, it clearly recognizes that
each law may provide not only a different period for reckoning its effectivity date but
also a different mode of notice. Thus, a law may prescribe that it shall be published
elsewhere than in the Official Gazette.

Commonwealth Act No. 638, in my opinion, does not support the proposition that for
their effectivity, laws must be published in the Official Gazette. The said law is simply
"An Act to Provide for the Uniform Publication and Distribution of the Official Gazette."
Conformably therewith, it authorizes the publication of the Official Gazette, determines
its frequency, provides for its sale and distribution, and defines the authority of the
Director of Printing in relation thereto. It also enumerates what shall be published in the
Official Gazette, among them, "important legislative acts and resolutions of a public
nature of the Congress of the Philippines" and "all executive and administrative orders
and proclamations, except such as have no general applicability." It is noteworthy that
not all legislative acts are required to be published in the Official Gazette but only
"important" ones "of a public nature." Moreover, the said law does not provide that
publication in the Official Gazette is essential for the effectivity of laws. This is as it
should be, for all statutes are equal and stand on the same footing. A law, especially an
earlier one of general application such as Commonwealth Act No. 638, cannot nullify or
restrict the operation of a subsequent statute that has a provision of its own as to when
and how it will take effect. Only a higher law, which is the Constitution, can assume that
role.

In fine, I concur in the majority decision to the extent that it requires notice before laws
become effective, for no person should be bound by a law without notice. This is
elementary fairness. However, I beg to disagree insofar as it holds that such notice shall
be by publication in the Official Gazette.
Cuevas and Alampay, JJ., concur.

GUTIERREZ, Jr., J., concurring:

I concur insofar as publication is necessary but reserve my vote as to the necessity of

such publication being in the Official Gazette.

DE LA FUENTE, J., concurring:

I concur insofar as the opinion declares the unpublished decrees and issuances of a
public nature or general applicability ineffective, until due publication thereof.

G.R. No. L-36049 May 31, 1976

CITY OF NAGA, VICENTE P. SIBULO, as Mayor, and JOAQUIN C. CLEOPE, as

Treasurer of the City of Naga, petitioners,
vs.
CATALINO AGNA, FELIPE AGNA and SALUD VELASCO, respondents.

Ernesto A. Miguel for petitioners.

Bonot, Cledera & Associates for respondents.

MARTIN, J.:

Petition for review on certiorari, which We treat as special civil action, of the decision of
the Court of First Instance of Camarines Sur in Civil Case No. 7084, entitled Agna, et al.
versus City of Naga, et al., declaring Ordinance No. 360 of the City of Naga enforceable
in 1971 the year following its approval and requiring petitioners to pay to private
respondents the amounts sought for in their complaint plus attorney's fees and costs.
Included in the present controversy as proper parties are Vicente P. Sibulo and Joaquin
C. Cleope, the City Mayor and City Treasurer of the City of Naga, respectively.

On June 15, 1970, the City of Naga enacted Ordinance No. 360 changing and
amending the graduated tax on quarterly gross sales of merchants prescribed in
Section 3 of Ordinance No. 4 of the City of Naga to percentage tax on gross sales
provided for in Section 2 thereof. Pursuant to said ordinance, private respondents paid
to the City of Naga the following taxes on their gross sales for the quarter from July 1,
1970 to September 30, 1970, as follows:

Catalino Agna paid P1,805.17 as per Official Receipt No. 1826591;

Felipe Agna paid P625.00 as per Official Receipt No. 1826594; and

Salud Velasco paid P129.81 as per Official Receipt No. 1820339.

On February 13, 1971, private respondents filed with the City Treasurer of the City of
Naga a claim for refund of the following amounts, together with interests thereon from
the date of payments: To Catalino Agna, P1,555.17; to Felipe Agna, P560.00; and to
Salud Velasco, P127.81, representing the difference between the amounts they paid
under Section 3, Ordinance No. 4 of the City of Naga, i.e., P250.00; P65.00 and P12.00
respectively. They alleged that under existing law, Ordinance No. 360, which amended
Section 3, Ordinance No. 4 of the City of Naga, did not take effect in 1970, the year it
was approved but in the next succeeding year after the year of its approval, or in 1971,
and that therefore, the taxes they paid in 1970 on their gross sales for the quarter from
July 1, 1970 to September 30, 1970 were illegal and should be refunded to them by the
petitioners.

The City Treasurer denied the claim for refund of the amounts in question. So private
respondents filed a complaint with the Court of First Instance of Naga (Civil Case No.
7084), seeking to have Ordinance No. 360 declared effective only in the year following
the year of its approval, that is, in 1971; to have Sections 4, 6 and 8 of Ordinance No.
360 declared unjust, oppressive and arbitrary, and therefore, null and void; and to
require petitioners to refund the sums being claimed with interests thereon from the date
the taxes complained of were paid and to pay all legal costs and attorney's fees in the
sum of P1,000.00. Private respondents further prayed that the petitioners be enjoined
from enforcing Ordinance No. 360.

In their answer, the petitioners among other things, claimed that private respondents
were not "compelled" but voluntarily made the payments of their taxes under Ordinance
No. 360; that the said ordinance was published in accordance with law; that in
accordance with Republic Act No. 305 (Charter of the City of Naga) an ordinance takes
effect after the tenth day following its passage unless otherwise stated in said
ordinance; that under existing law the City of Naga is authorized to impose certain
conditions to secure and accomplish the collection of sales taxes in the most effective
manner. As special and affirmative defenses, the petitioners allege that the private
respondents have no cause of action against them; that granting that the collection of
taxes can be enjoined. the complaint does not allege facts sufficient to justify the
issuance of a writ of preliminary injunction; that the refund prayed for by the private
respondents is untenable; that petitioners Vicente P. Sibulo and Joaquin C. Cleope, the
City Mayor and Treasurer of the City of Naga, respectively are not proper parties in
interest; that the private respondents are estopped from questioning the validity and/or
constitutionality of the provisions of Ordinance No. 360. Petitioners counterclaimed for
P20,000.00 as exemplary damages, for the alleged unlawful and malicious filing of the
claim against them, in such amount as the court may determine.
During the hearing of the petition for the issuance of a writ of preliminary injunction and
at the pre-trial conference as well as at the trial on the merits of the case, the parties
agreed on the following stipulation of facts: That on June 15, 1970, the City Board of the
City of Naga enacted Ordinance No. 360 entitled "An ordinance repealing Ordinance
No. 4, as amended, imposing a sales tax on the quarterly sales or receipts on all
businesses in the City of Naga," which ordinance was transmitted to the City Mayor for
approval or veto on June 25, 1970; that the ordinance was duly posted in the
designated places by the Secretary of the Municipal Board; that private respondents
voluntarily paid the gross sales tax, pursuant to Ordinance No. 360, but that on
February 15, 1971, they filed a claim for refund with the City Treasurer who denied the
same.

On October 9, 1971, the respondent Judge rendered judgment holding that Ordinance
No. 360, series of 1970 of the City of Naga was enforceable in the year following the
date of its approval, that is, in 1971 and required the petitioners to reimburse the
following sums, from the date they paid their taxes to the City of Naga: to Catalino
Agna, the sum of P1,555.17; to Felipe Agna, P560.00; and to Salud Velasco, P127.81
and the corresponding interests from the filing of the complaint up to the reimbursement
of the amounts plus the sum of P500.00 as attorney's fees and the costs of the
proceedings.

Petitioners' submit that Ordinance No. 360, series of 1970 of the City of Naga, took
effect in the quarter of the year of its approval, that is in July 1970, invoking Section 14
of Republic Act No. 305, 1 as amended, otherwise known as the Charter of the City of
Naga, which, among others, provides that "Each approved ordinance ... shall take effect
and be enforced on and after the 10th day following its passage unless otherwise stated
in said ordinance ... ". They contend that Ordinance No. 360 was enacted by the
Municipal Board of the City of Naga on June 15, 1970 2 and was transmitted to the City
Mayor for his approval or veto on June 25, 1970 3 but it was not acted upon by the City
Mayor until August 4, 1970. Ordinarily, pursuant to Section 14 of Republic Act No. 305,
said ordinance should have taken effect after the 10th day following its passage on
June 15, 1970, or on June 25, 1970. But because the ordinance itself provides that it
shall take effect upon its approval, it becomes necessary to determine when Ordinance
No. 360 was deemed approved. According to the same Section 14 of Republic Act No.
305, "if within 10 days after receipt of the ordinance the Mayor does not return it with his
veto or approval 4 the ordinance is deemed approved." Since the ordinance in question
was not returned by the City Mayor with his veto or approval within 10 days after he
received it on June 25, 1970, the same was deemed approved after the lapse of ten
(10) days from June 25, 1970 or on July 6, 1970. On this date, the petitioners claim that
Ordinance No. 360 became effective. They further contend that even under Section 2,
of Republic Act No. 2264 (Local Autonomy Acts) 5 which expressly provides: "A tax
ordinance shall go into effect on the fifteenth day after its passage unless the ordinance
shall provide otherwise', Ordinance No. 360 could have taken effect on June 30, 1970,
which is the fifteenth day after its passage by the Municipal Board of the City of Naga on
June 15, 1970, or as earlier explained, it could have taken effect on July 6, 1970, the
date the ordinance was deemed approved because the ordinance itself provides that it
shall take effect upon its approval. Of the two provisions invoked by petitioners to
support their stand that the ordinance in question took effect in the year of its approval,
it is Section 2 of Republic Act No. 2264 (Local Autonomy Act) that is more relevant
because it is the provision that specifically refers to effectivity of a tax ordinance and
being a provision of much later law it is deemed to have superseded Section 14 of
Republic Act No. 305 (Charter of the City of Naga) in so far as effectivity of a tax
ordinance is concerned.

On the other hand, private respondents contend that Ordinance No. 360 became
effective and enforceable in 1971, the year following the year of its approval, invoking
Section 2309 of the Revised Administrative Code which provides:

Section 2309. Imposition of tax and duration of license.—A municipal

license tax already in existence shall be subject to change only by
ordinance enacted prior to the 15th day of December of any year after the
next succeeding year, but an entirely new tax may be created by any
ordinance enacted during the quarter year effective at the beginning of
any subsequent quarter.

They submit that since Ordinance No. 360, series of 1970 of the City of Naga, is one
which changes the existing graduated sales tax on gross sales or receipts of dealers of
merchandise and sari-sari merchants provided for in Ordinance No. 4 of the City of
Naga to a percentage tax on their gross sales prescribed in the questioned ordinance,
the same should take effect in the next succeeding year after the year of its approval or
in 1971.

Evidently, the divergence of opinion as to when Ordinance No. 360 took effect and
became enforceable is mainly due to the seemingly apparent conflict between Section
2309 of the Revised Administrative Code and Section 2 of Republic Act No. 2264 (Local
Autonomy Act). Is there really such a conflict in the above-mentioned provisions? It will
be easily noted that Section 2309 of the Revised Administrative Code contemplates of
two types of municipal ordinances, namely: (1) a municipal ordinance which changes a
municipal license tax already in existence and (2) an ordinance which creates an
entirely new tax. Under the first type, a municipal license tax already in existence shall
be subject to change only by an ordinance enacted prior to the 15th day of December of
any year after the next succeeding year. This means that the ordinance enacted prior to
the 15th day of December changing or repealing a municipal license tax already in
existence will have to take effect in next succeeding year. The evident purpose of the
provision is to enable the taxpayers to adjust themselves to the new charge or burden
brought about by the new ordinance. This is different from the second type of a
municipal ordinance where an entirely new tax may be created by any ordinance
enacted during the quarter year to be effective at the beginning of any subsequent
quarter. We do not find any such distinction between an ordinance which changes a
municipal license tax already in existence and an ordinance creating an entirely new tax
in Section 2 of Republic Act No. 2264 (Local Autonomy Act) which merely refers to a
"tax ordinance" without any qualification whatsoever.

Now to the meat of the problem in this petition. Is not Section 2309 of the Revised
Administrative Code deemed repealed or abrogated by Section 2 of Republic Act No.
2264 (Local Autonomy Act) in so far as effectivity of a tax ordinance is concerned? An
examination of Republic Act No. 2264 (Local Autonomy Act) fails to show any provision
expressly repealing Section 2309 of the Revised Administrative Code. All that is
mentioned therein is Section 9 which reads:
 Section 9 — All acts, executive orders, administrative orders,
proclamations or parts thereof, inconsistent with any of the provisions of
this Act are hereby repealed and modified accordingly.

The foregoing provision does not amount to an express repeal of Section 2309 of the
Revised Administrative Code. It is a well established principle in statutory construction
that a statute will not be construed as repealing prior acts on the same subject in the
absence of words to that effect unless there is an irreconcilable repugnancy between
them, or unless the new law is evidently intended to supersede all prior acts on the
matter in hand and to comprise itself the sole and complete system of legislation on that
subject. Every new statute should be construed in connection with those already
existing in relation to the same subject matter and all should be made to harmonize and
stand together, if they can be done by any fair and reasonable interpretation ... . 6 It will
also be noted that Section 2309 of the Revised Administrative Code and Section 2 of
Republic Act No. 2264 (Local Autonomy Act) refer to the same subject matter-
enactment and effectivity of a tax ordinance. In this respect they can be considered in
pari materia. Statutes are said to be in pari materia when they relate to the same person
or thing, or to the same class of persons or things, or have the same purpose or object.
7 When statutes are in pari materia, the rule of statutory construction dictates that they
should be construed together. This is because enactments of the same legislature on
the same subject matter are supposed to form part of one uniform system; that later
statutes are supplementary or complimentary to the earlier enactments and in the
passage of its acts the legislature is supposed to have in mind the existing legislation on
the same subject and to have enacted its new act with reference thereto. 8 Having thus
in mind the previous statutes relating to the same subject matter, whenever the
legislature enacts a new law, it is deemed to have enacted the new provision in
accordance with the legislative policy embodied in those prior statutes unless there is
an express repeal of the old and they all should be construed together. 9 In construing
them the old statutes relating to the same subject matter should be compared with the
new provisions and if possible by reasonable construction, both should be so construed
that effect may be given to every provision of each. However, when the new provision
and the old relating to the same subject cannot be reconciled the former shall prevail as
it is the latter expression of the legislative will. 10 Actually we do not see any conflict
between Section 2309 of the Revised Administrative Code and Section 2 of the
Republic Act No. 2264 (Local Autonomy Act). The conflict, if any, is more apparent than
real. It is one that is not incapable of reconciliation. And the two provisions can be
reconciled by applying the first clause of Section 2309 of the Revised Administrative
Code when the problem refers to the effectivity of an ordinance changing or repealing a
municipal license tax already in existence. But where the problem refers to effectivity of
an ordinance creating an entirely new tax, let Section 2 of Republic Act No. 2264 (Local
Autonomy Act) govern.

In the case before Us, the ordinance in question is one which changes the graduated
sales tax on gross sales or receipts of dealers of merchandise and sari-sari merchants
prescribed in Section 3 of Ordinance No. 4 of the City of Naga to percentage tax on
their gross sale-an ordinance which definitely falls within the clause of Section 2309 of
the Revised Administrative Code. Accordingly it should be effective and enforceable in
the next succeeding year after the year of its approval or in 1971 and private
respondents should be refunded of the taxes they have paid to the petitioners on their
gross sales for the quarter from July 1, 1970 to September 30, 1970 plus the
corresponding interests from the filing of the complaint until reimbursement of the
amount.

IN VIEW OF THE FOREGOING, the instant petition is hereby dismissed.

SO ORDERED.

Teehankee (Chairman), Makasiar, Esguerra and Muñoz Palma, JJ., concur.

GENERAL PRINCIPLES/PRESUMPTIONS ON THE INTERPRETATION OF CERTAIN

STATUTES

PENAL LAWS

G.R. No. L-12891 October 19, 1917

THE UNITED STATES, plaintiff-appellee,

vs.
FILOMENO ESTAPIA ET AL., defendants-appellants.

J. A. Clarin for appellants.

Acting Attorney-General Paredes for appellee.

CARSON, J.:

The defendants took part, either as principals or as spectators, in an ihaway, the local
name for a kind of cockfight in which it is agreed that the losing cock is to be divided
between the two owners of the two birds engaged in the fight. The owners, with a few of
their friends, were seen carrying the gamecocks to a grove of buri palms near a recently
constructed house; and were surprised by the police, soon afterwards, standing, with
some 8 or 10 onlookers, in a ring around the spot beneath a buri palm where the fight
had just taken place. There is nothing in the record which even tends to indicate that the
grove of buri palms where the fight took place had ever been used for such a purpose
on any occasion; or that on wager or bet was made on the fight, other than the
agreement that the losing bird should be killed and eaten by the owners of both cocks.

Upon proof of these facts judgment was entered in the court below convicting the
defendants of a violation of the provisions of section 1 of Act No. 480, and sentencing
each of them to pay a fine of P25 and the costs of the trial.
We agree with counsel for the appellants that the foregoing statement of the material
facts developed at the trial does not sustain this judgment of conviction.

The pertinent sections of Act No. 480 enacted October 15, 1902, reads as follows:

SECTION 1. Any person who shall maintain a cockpit for the fighting of cocks, or
who shall engage in cockfighting in a cockpit, or who shall attend as a spectator
of cockfighting is not lawfully licensed to take place by the municipality in which
the cockpit is situate, shall be punished by a fine not exceeding two hundred
dollars, in money of the United States, or by imprisonment not exceeding six
months, or both, in the discretion of the court.

SEC. 2. Any person who shall maintain or take part in a game of chance in a
cockpit, whether the cockpit be lawfully licensed or not, shall be punished by a
fine not exceeding two hundred dollars, in money of the United States, or by
imprisonment for not exceeding six months, or both, in the discretion of the court.

This statute does not penalize all unlicensed cockfighting, but merely unlicensed
cockfighting in a cockpit. The statute does not impose penalties on those "who shall
engage in cockfighting," but on those who "shall engage cockfighting in a cockpit." It
does not direct that the prescribed penalty shall be imposed on one "who shall attend as
a spectator of cockfighting," but on any person who "shall attend as spectator of
cockfighting in a cockpit." Manifestly, then, the penalties prescribed in this statute
cannot be imposed unless it affirmatively appears not only that the accused engaged in,
or were spectators of cockfighting, but also that this cockfighting took place in a cockpit.

We agree with counsel for the appellants that while it appears that the accused were
participants in, or spectators at an unlicensed cockfight, nevertheless, the evidence of
the record fails utterly to sustain a finding that this cockfight took place in a cockpit.

The Attorney-General suggests that the term cockpit as used in the statute should be
construed to mean any place at which a cockfight takes place. His argument would
seem to be that since, as he contends, every place at which a cockfight occurs is a
cockpit, proof that one engaged in, or was present at, a cockfight proof that he was
engaged in, or was present at a cockfight in a cockpit.

But this contention runs counter to the plain language of the statute and cannot be
supported by any sound rule of statutory construction.

(1) It violates the elementary rule that, when possible, all the words of a statute
are to be given some meaning so that when the legislator makes use of words of
limitation, he must be presumed to have intended to limit and restrict, in some
way, the word or idea with reference to which such words of limitation are
applied.

If cockfighting means exactly the same thing as cockfighting in a cockpit, why did
the legislator carefully insert the words in a cockpit after the word cockfighting on
both occasion when he made use of that term in the first section of the statute?
(2) The penal provisions of a statute are to be construed strictly — a rule of
construction which emphatically forbids any attempt to hold that when the
legislator penalizes the commission of an act on certain specific occasions, he
intends to penalize it on all occasions. A holding that the provisions of section 1
of this Act penalize unlicensed cockfighting on all occasions and wherever it may
take place, despite the fact that these particular penalties are especially limited to
unlicensed cockfighting in a cockpit, would run counter to both the spirit and the
letter of this rule.

(3) In construing particular words or terms used in a statute, due regard should
be had for the context. The provisions of the statute with relation to the
maintenance of unlicensed cockpits, and the taking part in games of chance in
cockpits, licensed or not, quite clearly indicate that when the legislator made use
of the word cockpit, he had in mind some place especially designed for use by
cockfighters, or used by cockfighters more or less frequently as the scene of their
encounters; and not merely a place at which upon a single occasion, and without
special preparation, a single encounter takes place between two birds.

(4) The English word cockpit connotes something more than a place on the side
of a road, in an open field, beneath a tree, or in a barn, where a single encounter
takes place between two birds. Originally it referred, of course, to the specially
prepared pits in which cocking-mains were fought. A main is defined by Webster
to be; "A match of several battles at cockfighting." In popular usage the word has
come to mean any place especially designed for use by cockfighters, or at which
cockfighting battles are had. But it would be a strained and unusual extension of
the meaning of the word, as used in the statute, to say that any and every place
at which a single encounter is had between a couple of birds is a cockpit. We are
satisfied that if such a strained and unusual use of the word is permissible under
any circumstances, it was not in this sense that it was used by the legislator
because, as we have seen, it would be a vain and meaningless thing to make
use of the term in this sense, as a word of limitation upon the word cockfighting.

Webster, Funk and Wagnalls, and the Twentieth Century Dictionary define a
cockpit to be, "A pit or ring for cockfighting." This definition clearly connotes some
idea of a place set apart for cockfighting or for the use of cockfighters either by
special adaptability or preparation therefor, or by more or less frequent use. The
meaning of the definition would not be wholly lost by substituting in the place of
the preposition "for," some such words as "adapted to," "appropriate to,"
"designed for," "intended for," or "used for." But the use of the simple preposition
"for" imports some suggestion of the dedication or devotion of the place to the
use indicated either by some specific form of preparation, or by its repeated use
to that end. It does not appear that the legislator had in mind any particular form
or degree of preparation, or any definite number of cockfights which would be
necessary to characterize a given place set apart for cockpit; but we are satisfied
that he contemplated that some preparation for use for cockfighting, or that the
celebration of more than one battle would be necessary to justify the courts in
characterizing a particular spot as a cockpit in the sense in which the word is
used in this statute. It may be that a grove of trees, a barn or shed, and even an
open field or crossroads to which a number of birds are brought to fight a main,
or to which cockfighters more or less frequently resort to engage in the sport,
 might fairly be included in the definition of the term as used in the statute — but
not a place to which, without any preparation, the owners of a couple of birds
betake themselves on a single occasion for a single encounter.

(5) The word gallera as used in the official Spanish version of the statute (to
which we are expressly authorized to look for aid in construing the English
version in case of doubt) has a still more restricted meaning than that which, as
we have indicated, may be given to the English word cockpit for which it is used
as an imperfect equivalent. The Spanish word gallera clearly conveys the idea of
a place especially and expressly designed for the conduct of cockfighting; and no
proper use of the word lends itself to the meaning which the Attorney-General
would place on the statute. Of course, the broader definition of the word cockpit
as found in the authoritative English version must prevail, but if any doubt can be
said to exist as to the sense in which that word is used in the statute, the use of
the word gallera as its equivalent in the Spanish version suggests that such
doubt must be resolved against the contention of the Attorney-General in the
case at bar.

It is urged that the meaning given to the language of the statute by the trial judge is that
which has been given to it by the Collector of Internal Revenue and the Attorney-
General since the date of its enactment, and that the court should not disturb the
uniform construction given a statute of this kind by these executive authorities. It is to be
observed, however, that this statute is not in any proper sense a revenue measure, so
that the rule, by virtue of which the courts pay marked respect to the uniform and long
continued construction placed upon the language of a revenue officers of the
government, has no special application in this case. We think that in view of the penal
character of the statute, the courts are not, and should not be bound, when the statute
first comes before them for interpretation, by any construction placed upon it by the
executive officers of the government, even if the language were fairly susceptible of the
meaning placed upon it by those officers. But holding, as we do, that the alleged
construction placed upon the statute by the executive officers of the government is
manifestly in conflict with the plain meaning of the terms used and the evident intention
of the legislator in the use of these terms, we are of the opinion that the construction
thus placed upon the statute should be, and must be wholly disregarded. The rule relied
upon by the prosecution is, at best, a mere aid to construction or interpretation in cases
where the language of a statute is fairly susceptible of more than one meaning, so that
substantial doubt arises as to the intent of the legislator in the use of such ambiguous
language.

It is urged, in support of the view taken by the executive authorities, that by applying this
penal provision to unlicensed cockfighting wherever it occurs, they have displayed
commendable activity in the repression of a reprehensible practice condemned by the
enlightened opinion of the day. To this it should be sufficient answer to say that neither
the executive nor the judicial authorities are authorized to impose fines and prison
sentences in cases wherein such fines and prison sentences are not clearly authorized
by law, and this without regard to the end sought to be attained by the enforcement of
such unauthorized penalties.

It is a matter of general knowledge in the Philippine Islands that, ever since the change
from Spanish to American sovereignty, more or less active agitation has been
maintained for the purpose of securing legislation absolutely prohibiting and penalizing
cockfighting in all its forms. The discussion of the subject by the legislative and
executive authorities of the government throughout that period clearly discloses a desire
on the part of these authorities to restrict and limit the practice, coupled, however, with a
full recognition of a grave question of public policy as to the measures which should be
adopted to that end, and the extent to which the prohibitions should be carried. Thus we
find the Governor-General of the Philippine Islands asserting in 1910 that "the
government's policy as regards cockfighting has been directed towards the gradual
restriction thereof:" and an examination of the statute book leaves no room for doubt
that the steadfast policy of the legislator has been to restrict and limit licensed or
authorized cockfighting in cockpits to a limited number of holidays and feast days, by
the enactment of general legislation to that end; and to entrust all questions as to
enforcement of further restrictions or limitations upon the practice of cockfighting, to the
local or municipal authorities throughout the Islands. 1awphil.net

The law now in force on this subject, other than that found in Act No. 480, is set forth in
the recently enacted Administrative Code. Sections 2285 and 2389 restrict all
cockfighting to authorized cockpits upon prescribed legal holidays, but make no express
provisions for the imposition of penalties for violation of their provisions. But it will be
found that the legislator has not left these legislative prohibition wholly without sanction.
Act No. 480 provides the appropriate penalties for violations of the general law
restricting cockfighting in cockpits to the legal holidays authorized by statute; and
subsection (i) of section 2243 of the Administrative Code confers authority upon the
various municipal councils throughout the Islands to adopt ordinances regulating or
prohibiting altogether cockpits, cockfighting and the keeping and training of fighting
cocks within their respective jurisdictions, and to provide such penalties for violations of
these ordinances as they may deem proper.

It has been said that the alleged evils incident to a popular practice of this kind can be
more effectively dealt with by entrusting legislation on the subject to the awakening of
an enlighted public opinion, as it finds expression in the enactment of local ordinances
and municipal registrations; rather than by the enactment of general penal legislation,
which takes no account of local sentiment or of differences in the degree of culture and
intelligence in the various communities scattered throughout the Islands. This view
would seem to have inspired the legislation heretofore enacted on this subject, and who
shall say that the lawmaker has acted wisely or unwisely in the adoption of the public
policy with regard to cockfighting which is disclosed by the laws on our statute books?
Certainly not the court, whose sworn duty it is to enforce the penal statutes as they are
found upon the statute book, and not otherwise.

We conclude that the judgment appealed from should be reversed, and the accused
acquitted of the offense of which they were convicted in the court below, with the costs
in both instances de officio. So ordered.

Arellano, C. J., Johnson, Araullo and Street, JJ., concur.

G.R. No. L-42050-66 November 20, 1978

THE PEOPLE OF THE PHILIPPINES, petitioner,

vs.
HONORABLE JUDGE AMANTE P. PURISIMA, COURT OF FIRST INSTANCE OF
MANILA, BRANCH VII, and PORFIRIO CANDELOSAS, NESTOR BAES, ELIAS L.
GARCIA, SIMEON BUNDALIAN, JR., JOSEPH C. MAISO, EDUARDO A. LIBORDO,
ROMEO L. SUGAY, FEDERICO T. DIZON, GEORGE M. ALBINO, MARIANO COTIA,
JR., ARMANDO L. DIZON, ROGELIO B. PARENO, RODRIGO V. ESTRADA,
ALFREDO A. REYES, JOSE A. BACARRA, REYNALDO BOGTONG, and EDGARDO
M. MENDOZA, respondents.

MUÑOZ PALMA, J.:

These twenty-six (26) Petitions for Review filed by the People of the Philippines
represented, respectively, by the Office of the City Fiscal of Manila, the Office of the
Provincial Fiscal of Samar, and joined by the Solicitor General, are consolidated in this
one Decision as they involve one basic question of law.

These Petitions or appeals involve three Courts of First Instance, namely: the Court of
First Instance of Manila, Branch VII, presided by Hon. Amante P. Purisima (17
Petitions), the Court of First Instance of Manila, Branch XVIII, presided by Hon. Maximo
A. Maceren (8 Petitions) and, the Court of First Instance of Samar, with Hon.
Wenceslao M. Polo, presiding, (1 Petition).

Before those courts, Informations were filed charging the respective accused with
"illegal possession of deadly weapon" in violation of Presidential Decree No. 9. On a
motion to quash filed by the accused, the three Judges mentioned above issued in the
respective cases filed before them — the details of which will be recounted below — an
Order quashing or dismissing the Informations, on a common ground, viz, that the
Information did not allege facts which constitute the offense penalized by Presidential
Decree No. 9 because it failed to state one essential element of the crime.

Thus, are the Informations filed by the People sufficient in form and substance to
constitute the offense of "illegal possession of deadly weapon" penalized under
Presidential Decree (PD for short) No. 9? This is the central issue which we shall
resolve and dispose of, all other corollary matters not being indispensable for the
moment.

A — The Information filed by the People —

1. In L-42050-66, one typical Information filed with the Court presided by Judge
Purisima follows:

THE PEOPLE OF THE PHILIPPINES, plaintiff, versus PORFIRIO

CANDELOSAS Y DURAN, accused.

Crim. Case No. 19639

 VIOLATION OF PAR. 3, PRES. DECREE No. 9 OF PROCLAMATION
1081

INFORMATION

The undersigned accuses PORFIRIO CANDELOSAS Y DURAN of a

violation of paragraph 3, Presidential Decree No. 9 of Proclamation 1081,
committed as follows:

That on or about the 14 th day of December, 1974, in the City of Manila,

Philippines, the said accused did then and there wilfully, unlawfully,
feloniously and knowingly have in his possession and under his custody
and control one (1) carving knife with a blade of 6-½ inches and a wooden
handle of 5-1/4 inches, or an overall length of 11-¾ inches, which the said
accused carried outside of his residence, the said weapon not being used
as a tool or implement necessary to earn his livelihood nor being used in
connection therewith.

Contrary to law. (p. 32, rollo of L-42050-66)

The other Informations are similarly worded except for the name of the accused, the
date and place of the commission of the crime, and the kind of weapon involved.

2. In L-46229-32 and L-46313-16, the Information filed with the Court presided by Judge
Maceren follows:

THE PEOPLE OF THE PHILIPPINES, plaintiff, versus REYNALDO LAQUI

Y AQUINO, accused.

CRIM.
CASE
NO.
29677

VIOL.
OF
PAR.
3,

PD 9
IN
REL.
TO
LOI

No.
266 of
the
Chief
 Execu
tive
dated
April
1,
1975

INFORMATION

The undersigned accuses REYNALDO LAQUI Y AQUINO of a

VIOLATION OF PARAGRAPH 3, PRESIDENTIAL DECREE NO. 9 in
relation to Letter of Instruction No. 266 of the Chief Executive dated April
1, 1975, committed as follows:

That on or about the 28 th day of January, 1977, in the City of Manila,

Philippines, the said accused did then and there wilfully, unlawfully and
knowingly carry outside of his residence a bladed and pointed weapon, to
wit: an ice pick with an overall length of about 8½ inches, the same not
being used as a necessary tool or implement to earn his livelihood nor
being used in connection therewith.

Contrary to law. (p. 14, rollo of L-46229-32)

The other Informations are likewise similarly worded except for the name of the
accused, the date and place of the commission of the crime, and the kind of weapon
involved.

3. In L-46997, the Information before the Court of First Instance of Samar is quoted
hereunder:

PEOPLE OF THE PHILIPPINES, complainant, versus PANCHITO

REFUNCION, accused.

CRIM.
CASE
NO.
933

For:

ILLEG
AL
POSS
ESSI
ON
OF

DEAD
LY
 WEAP
ON

(VIOL
ATIO
N OF
PD
NO. 9)

INFORMATION

The undersigned First Assistant Provincial Fiscal of Samar, accuses

PANCHITO REFUNCION of the crime of ILLEGAL POSSESSION OF
DEADLY WEAPON or VIOLATION OF PD NO. 9 issued by the President
of the Philippines on Oct. 2, 1972, pursuant to Proclamation No. 1081
dated Sept. 21 and 23, 1972, committed as follows:

That on or about the 6th day of October, 1976, in the evening at Barangay
Barruz, Municipality of Matuginao, Province of Samar Philippines, and
within the jurisdiction of this Honorabe Court, the abovenamed accused,
knowingly, wilfully, unlawfully and feloniously carried with him outside of
his residence a deadly weapon called socyatan, an instrument which from
its very nature is no such as could be used as a necessary tool or
instrument to earn a livelihood, which act committed by the accused is a
Violation of Presidential Decree No. 9.

CONTRARY TO LAW. (p. 8, rollo of L-46997)

B. — The Orders of dismissal —

In dismissing or quashing the Informations the trial courts concurred with the submittal
of the defense that one essential element of the offense charged is missing from the
Information, viz: that the carrying outside of the accused's residence of a bladed,
pointed or blunt weapon is in furtherance or on the occasion of, connected with or
related to subversion, insurrection, or rebellion, organized lawlessness or public
disorder.

1. Judge Purisima reasoned out, inter alia, in this manner:

... the Court is of the opinion that in order that possession of bladed
weapon or the like outside residence may be prosecuted and tried under
P.D. No. 9, the information must specifically allege that the possession of
bladed weapon charged was for the purpose of abetting, or in furtherance
of the conditions of rampant criminality, organized lawlessness, public
disorder, etc. as are contemplated and recited in Proclamation No. 1081,
as justification therefor. Devoid of this specific allegation, not necessarily
in the same words, the information is not complete, as it does not allege
sufficient facts to constitute the offense contemplated in P.D. No. 9. The
information in these cases under consideration suffer from this defect.
xxx xxx xxx

And while there is no proof of it before the Court, it is not difficult to believe
the murmurings of detained persons brought to Court upon a charge of
possession of bladed weapons under P.D. No. 9, that more than ever
before, policemen - of course not all can be so heartless — now have in
their hands P.D. No. 9 as a most convenient tool for extortion, what with
the terrifying risk of being sentenced to imprisonment of five to ten years
for a rusted kitchen knife or a pair of scissors, which only God knows
where it came from. Whereas before martial law an extortion-minded
peace officer had to have a stock of the cheapest paltik, and even that
could only convey the coercive message of one year in jail, now anything
that has the semblance of a sharp edge or pointed object, available even
in trash cans, may already serve the same purpose, and yet five to ten
times more incriminating than the infamous paltik.

For sure, P.D. No. 9 was conceived with the best of intentions and wisely
applied, its necessity can never be assailed. But it seems it is back-firing,
because it is too hot in the hands of policemen who are inclined to
backsliding.

The checkvalves against abuse of P.D. No. 9 are to be found in the heart
of the Fiscal and the conscience of the Court, and hence this resolution,
let alone technical legal basis, is prompted by the desire of this Court to
apply said checkvalves. (pp. 55-57, rollo of L-42050-66)

2. Judge Maceren in turn gave his grounds for dismissing the charges as follows:

xxx xxx xxx

As earlier noted the "desired result" sought to be attained by Proclamation

No. 1081 is the maintenance of law and order throughout the Philippines
and the prevention and suppression of all forms of lawless violence as
well as any act of insurrection or rebellion. It is therefore reasonable to
conclude from the foregoing premises that the carrying of bladed, pointed
or blunt weapons outside of one's residence which is made unlawful and
punishable by said par. 3 of P.D. No. 9 is one that abets subversion,
insurrection or rebellion, lawless violence, criminality, chaos and public
disorder or is intended to bring about these conditions. This conclusion is
further strengthened by the fact that all previously existing laws that also
made the carrying of similar weapons punishable have not been repealed,
whether expressly or impliedly. It is noteworthy that Presidential Decree
No. 9 does not contain any repealing clause or provisions.

xxx xxx xxx

The mere carrying outside of one's residence of these deadly weapons if

not concealed in one's person and if not carried in any of the aforesaid
specified places, would appear to be not unlawful and punishable by law.
 With the promulgation of Presidential Decree No. 9, however, the
prosecution, through Assistant Fiscal Hilario H. Laqui, contends in his
opposition to the motion to quash, that this act is now made unlawful and
punishable, particularly by paragraph 3 thereof, regardless of the intention
of the person carrying such weapon because the law makes it "mala
prohibita". If the contention of the prosecution is correct, then if a person
happens to be caught while on his way home by law enforcement officers
carrying a kitchen knife that said person had just bought from a store in
order that the same may be used by one's cook for preparing the meals in
one's home, such person will be liable for punishment with such a severe
penalty as imprisonment from five to ten years under the decree. Such
person cannot claim that said knife is going to be used by him to earn a
livelihood because he intended it merely for use by his cook in preparing
his meals.

This possibility cannot be discounted if Presidential Decree No. 9 were to

be interpreted and applied in the manner that that the prosecution wants it
to be done. The good intentions of the President in promulgating this
decree may thus be perverted by some unscrupulous law enforcement
officers. It may be used as a tool of oppression and tyranny or of extortion.

xxx xxx xxx

It is therefore the considered and humble view of this Court that the act
which the President intended to make unlawful and punishable by
Presidential Decree No. 9, particularly by paragraph 3 thereof, is one that
abets or is intended to abet subversion, rebellion, insurrection, lawless
violence, criminality, chaos and public disorder. (pp. 28-30, rollo of L-
46229-32)

3. Judge Polo of the Court of First Instance of Samar expounded his order dismissing
the Information filed before him, thus:

... We believe that to constitute an offense under the aforcited Presidential

decree, the same should be or there should be an allegation that a felony
was committed in connection or in furtherance of subversion, rebellion,
insurrection, lawless violence and public disorder. Precisely Proclamation
No. 1081 declaring a state of martial law throughout the country was
issued because of wanton destruction to lives and properties widespread
lawlessness and anarchy. And in order to restore the tranquility and
stability of the country and to secure the people from violence anti loss of
lives in the quickest possible manner and time, carrying firearms,
explosives and deadly weapons without a permit unless the same would
fall under the exception is prohibited. This conclusion becomes more
compelling when we consider the penalty imposable, which is from five
years to ten years. A strict enforcement of the provision of the said law
would mean the imposition of the Draconian penalty upon the accused.

xxx xxx xxx

 It is public knowledge that in rural areas, even before and during martial
law, as a matter of status symbol, carrying deadly weapons is very
common, not necessarily for committing a crime nor as their farm
implement but for self-preservation or self-defense if necessity would arise
specially in going to and from their farm. (pp. 18-19, rollo of L-46997)

In most if not all of the cases, the orders of dismissal were given before arraignment of
the accused. In the criminal case before the Court of (First Instance of Samar the
accused was arraigned but at the same time moved to quash the Information. In all the
cases where the accused were under arrest, the three Judges ordered their immediate
release unless held on other charges.

C. — The law under which the Informations in question were filed by the People.

As seen from the Informations quoted above, the accused are charged with illegal
possession of deadly weapon in violation of Presidential Decree No. 9, Paragraph 3.

We quote in full Presidential Decree No. 9, to wit:

PRESIDENTIAL DECREE NO. 9

DECLARING VIOLATIONS OF GENERAL ORDERS NO. 6 and NO. 7

DATED SEPTEMBER 22, 1972, AND SEPTEMBER 23, 1972,
RESPECTIVELY, TO BE UNLAWFUL AND PROVIDING PENALTIES
THEREFORE.

WHEREAS, pursuant to Proclamation No. 1081 dated September 21,

1972, the Philippines has been placed under a state of martial law;

WHEREAS, by virtue of said Proclamation No. 1081, General Order No. 6

dated September 22, 1972 and General Order No. 7 dated September 23,
1972, have been promulgated by me;

WHEREAS, subversion, rebellion, insurrection, lawless violence,

criminality, chaos and public disorder mentioned in the aforesaid
Proclamation No. 1081 are committed and abetted by the use of firearms,
explosives and other deadly weapons;

NOW, THEREFORE, I, FERDINAND E. MARCOS, Commander-in-Chief

of all the Armed Forces of the Philippines, in older to attain the desired
result of the aforesaid Proclamation No. 1081 and General Orders Nos. 6
and 7, do hereby order and decree that:

1. Any violation of the aforesaid General Orders Nos. 6 and 7 is unlawful

and the violator shall, upon conviction suffer:

(a) The mandatory penalty of death by a firing squad or electrocution as a

Military, Court/Tribunal/Commission may direct, it the firearm involved in
the violation is unlicensed and is attended by assault upon, or resistance
to persons in authority or their agents in the performance of their official
functions resulting in death to said persons in authority or their agent; or if
such unlicensed firearm is used in the commission of crimes against
persons, property or chastity causing the death of the victim used in
violation of any other General Orders and/or Letters of Instructions
promulgated under said Proclamation No. 1081:

(b) The penalty of imprisonment ranging from twenty years to life

imprisonment as a Military Court/Tribunal/commission may direct, when
the violation is not attended by any of the circumstances enumerated
under the preceding paragraph;

(c) The penalty provided for in the preceding paragraphs shall be imposed
upon the owner, president, manager, members of the board of directors or
other responsible officers of any public or private firms, companies,
corporations or entities who shall willfully or knowingly allow any of the
firearms owned by such firm, company, corporation or entity concerned to
be used in violation of said General Orders Nos. 6 and 7.

2. It is unlawful to posses deadly weapons, including hand grenades, rifle

grenades and other explosives, including, but not limited to, "pill box
bombs," "molotov cocktail bombs," "fire bombs," or other incendiary device
consisting of any chemical, chemical compound, or detonating agents
containing combustible units or other ingredients in such proportion,
quantity, packing, or bottling that ignites by fire, by friction, by concussion,
by percussion, or by detonation of all or part of the compound or mixture
which may cause such a sudden generation of highly heated gases that
the resultant gaseous pressures are capable of producing destructive
effects on continguous objects or of causing injury or death of a person;
and any person convicted thereof shall be punished by imprisonment
ranging from ten to fifteen years as a Military Court/Tribunal/Commission
may direct.

3. It is unlawful to carry outside of residence any bladed, pointed or blunt

weapon such as "fan knife," "spear," "dagger," "bolo," "balisong," "barong,"
"kris," or club, except where such articles are being used as necessary
tools or implements to earn a livelihood and while being used in
connection therewith; and any person found guilty thereof shall suffer the
penalty of imprisonment ranging from five to ten years as a Military
Court/Tribunal/Commission may direct.

4. When the violation penalized in the preceding paragraphs 2 and 3 is

committed during the commission of or for the purpose of committing, any
other crime, the penalty shall be imposed upon the offender in its
maximum extent, in addition to the penalty provided for the particular
offenses committed or intended to be committed.

Done in the City of Manila, this 2nd day of October in the year of Our Lord,
nineteen hundred and seventy-two.
 (SGD) FERDINAND
E. MARCOS

Presid
ent

Republic of the
Philippines

D. — The arguments of the People —

In the Comment filed in these cases by the Solicitor General who as stated earlier joins
the City Fiscal of Manila and the Provincial Fiscal of Samar in seeking the setting aside
of the questioned orders of dismissal, the main argument advanced on the issue now
under consideration is that a perusal of paragraph 3 of P.D. 9 'shows that the prohibited
acts need not be related to subversive activities; that the act proscribed is essentially a
malum prohibitum penalized for reasons of public policy.1

The City Fiscal of Manila in his brief adds further that in statutory offenses the intention
of the accused who commits the act is immaterial; that it is enough if the prohibited act
is voluntarily perpetuated; that P.D. 9 provides and condemns not only the carrying of
said weapon in connection with the commission of the crime of subversion or the like,
but also that of criminality in general, that is, to eradicate lawless violence which
characterized pre-martial law days. It is also argued that the real nature of the criminal
charge is determined not from the caption or preamble of the information nor from the
specification of the provision of law alleged to have been violated but by the actual
recital of facts in the complaint or information.2

E. — Our Ruling on the matter —

1. It is a constitutional right of any person who stands charged in a criminal prosecution

to be informed of the nature and cause of the accusation against him.3

Pursuant to the above, Section 5, Rule 110 of the Rules of Court, expressly requires
that for a complaint or information to be sufficient it must, inter alia state the designation
of the offense by the statute, and the acts or omissions complained of as constituting
the offense. This is essential to avoid surprise on the accused and to afford him the
opportunity to prepare his defense accordingly. 4

To comply with these fundamental requirements of the Constitution and the Rules on
Criminal Procedure, it is imperative for the specific statute violated to be designated or
mentioned 4 in the charge. In fact, another compelling reason exists why a specification
of the statute violated is essential in these cases. As stated in the order of respondent
Judge Maceren the carrying of so-called "deadly weapons" is the subject of another
penal statute and a Manila city ordinance. Thus, Section 26 of Act No. 1780 provides:

Section 26. It should be unlawful for any person to carry concealed about
his person any bowie knife, dirk dagger, kris, or other deadly weapon: ...
Any person violating the provisions of this section shall, upon conviction in
a court of competent jurisdiction, be punished by a fine not exceeding five
 hundred pesos, or by imprisonment for a period not exceeding six months,
or both such fine and imprisonment, in the discretion of the court.

Ordinance No. 3820 of the City of Manila as amended by Ordinance No. 3928 which
took effect on December 4, 1957, in turn penalizes with a fine of not more than P200.00
or imprisonment for not more than one months, or both, at the discretion of the court,
anyone who shall carry concealed in his person in any manner that would disguise its
deadly character any kind of firearm, bowie knife, or other deadly weapon ... in any
public place. Consequently, it is necessary that the particular law violated be specified
as there exists a substantial difference between the statute and city ordinance on the
one hand and P.D. 9 (3) on the other regarding the circumstances of the commission of
the crime and the penalty imposed for the offense.

We do not agree with petitioner that the above-mentioned statute and the city ordinance
are deemed repealed by P.D. 9 (3). 5 P. D. 9(3) does not contain any repealing clause
or provision, and repeal by implication is not favored. 6 This principle holds true with
greater force with regards to penal statutes which as a rule are to be construed strictly
against the state and liberally in favor of the accused. 7 In fact, Article 7 of the New Civil
Code provides that laws are repealed only by subsequent ones and their violation or
non- observance shall not be excused by disuse, or custom or practice to the contrary.

Thus we are faced with the situation where a particular act may be made to fall, at the
discretion of a police officer or a prosecuting fiscal, under the statute, or the city
ordinance, or the presidential decree. That being the case, the right becomes more
compelling for an accused to be confronted with the facts constituting the essential
elements of the offense charged against him, if he is not to become an easy pawn of
oppression and harassment, or of negligent or misguided official action — a fear
understandably shared by respondent Judges who by the nature of their judicial
functions are daily exposed to such dangers.

2. In all the Informations filed by petitioner the accused are charged in the caption as
well as in the body of the Information with a violation of paragraph 3, P.D. 9. What then
are the elements of the offense treated in the presidential decree in question?

We hold that the offense carries two elements: first, the carrying outside one's residence
of any bladed, blunt, or pointed weapon, etc. not used as a necessary tool or implement
for a livelihood; and second, that the act of carrying the weapon was either in
furtherance of, or to abet, or in connection with subversion, rebellion, insurrection,
lawless violence, criminality, chaos, or public disorder.

It is the second element which removes the act of carrying a deadly weapon, if
concealed, outside of the scope of the statute or the city ordinance mentioned above. In
other words, a simple act of carrying any of the weapons described in the presidential
decree is not a criminal offense in itself. What makes the act criminal or punishable
under the decree is the motivation behind it. Without that motivation, the act falls within
the purview of the city ordinance or some statute when the circumstances so warrant.

Respondent Judges correctly ruled that this can be the only reasonably, logical, and
valid construction given to P.D. 9(3).
3. The position taken by petitioner that P.D. 9(3) covers one and all situations where a
person carries outside his residence any of the weapons mentioned or described in the
decree irrespective of motivation, intent, or purpose, converts these cases into one of
"statutory construction." That there is ambiguity in the presidential decree is manifest
from the conflicting views which arise from its implementation. When ambiguity exists, it
becomes a judicial task to construe and interpret the true meaning and scope of the
measure, guided by the basic principle that penal statutes are to be construed and
applied liberally in favor of the accused and strictly against the state.

4. In the construction or interpretation of a legislative measure — a presidential decree

in these cases — the primary rule is to search for and determine the intent and spirit of
the law. Legislative intent is the controlling factor, for in the words of this Court in
Hidalgo v. Hidalgo, per Mr. Justice Claudio Teehankee, whatever is within the spirit of a
statute is within the statute, and this has to be so if strict adherence to the letter would
result in absurdity, injustice and contradictions. 8

There are certain aids available to Us to ascertain the intent or reason for P.D. 9(3).

First, the presence of events which led to or precipitated the enactment of P.D. 9. These
events are clearly spelled out in the "Whereas" clauses of the presidential decree, thus:
(1) the state of martial law in the country pursuant to Proclamation 1081 dated
September 21, 1972; (2) the desired result of Proclamation 1081 as well as General
Orders Nos. 6 and 7 which are particularly mentioned in P.D. 9; and (3) the alleged fact
that subversion, rebellion, insurrection, lawless violence, criminality, chaos, aid public
disorder mentioned in Proclamation 1081 are committed and abetted by the use of
firearms and explosives and other deadly weapons.

The Solicitor General however contends that a preamble of a statute usually introduced
by the word "whereas", is not an essential part of an act and cannot enlarge or confer
powers, or cure inherent defects in the statute (p. 120, rollo of L-42050-66); that the
explanatory note or enacting clause of the decree, if it indeed limits the violation of the
decree, cannot prevail over the text itself inasmuch as such explanatory note merely
states or explains the reason which prompted the issuance of the decree. (pp. 114-115,
rollo of 46997)

We disagree with these contentions. Because of the problem of determining what acts
fall within the purview of P.D. 9, it becomes necessary to inquire into the intent and spirit
of the decree and this can be found among others in the preamble or, whereas" clauses
which enumerate the facts or events which justify the promulgation of the decree and
the stiff sanctions stated therein.

A "preamble" is the key of the statute, to open the minds of the makers as
to the mischiefs which are to be remedied, and objects which are to be
accomplished, by the provisions of the statute." (West Norman Timber v.
State, 224 P. 2d 635, 639, cited in Words and Phrases, "Preamble";
emphasis supplied)

While the preamble of a statute is not strictly a part thereof, it may, when
the statute is in itself ambiguous and difficult of interpretation, be resorted
to, but not to create a doubt or uncertainty which otherwise does not
 exist." (James v. Du Bois, 16 N.J.L. (1 Har.) 285, 294, cited in Words and
Phrases, "Preamble")

In Aboitiz Shipping Corporation, et al. v. The City of Cebu, et al. this Court had occasion
to state that '(L)egislative intent must be ascertained from a consideration of the statute
as a whole, and not of an isolated part or a particular provision alone. This is a cardinal
rule of statutory construction. For taken in the abstract, a word or phrase might easily
convey a meaning quite different from the one actually intended and evident when the
word or phrase is considered with those with which it is associated. Thus, an apparently
general provision may have a limited application if read together with other provisions. 9

Second, the result or effects of the presidential decree must be within its reason or
intent.

In the paragraph immediately following the last "Whereas" clause, the presidential
decree states:

NOW, THEREFORE, I , FERDINAND E. MARCOS, Commander-in-Chief

of an the Armed Forces of the Philippines, in order to attain the desired
result of the aforesaid Proclamation No. 1081 and General Orders Nos. 6
and 7, do hereby order and decree that:

xxx xxx xxx

From the above it is clear that the acts penalized in P.D. 9 are those
related to the desired result of Proclamation 1081 and General Orders
Nos. 6 and 7. General Orders Nos. 6 and 7 refer to firearms and therefore
have no relevance to P.D. 9(3) which refers to blunt or bladed weapons.
With respect to Proclamation 1081 some of the underlying reasons for its
issuance are quoted hereunder:

WHEREAS, these lawless elements having taken up arms against our

duly constituted government and against our people, and having
committed and are still committing acts of armed insurrection and rebellion
consisting of armed raids, forays, sorties, ambushes, wanton acts of
murders, spoilage, plunder, looting, arsons, destruction of public and
private buildings, and attacks against innocent and defenseless civilian
lives and property, all of which activities have seriously endangered and
continue to endanger public order and safety and the security of the
nation, ...

xxx xxx xxx

WHEREAS, it is evident that there is throughout the land a state of

anarchy and lawlessness, chaos and disorder, turmoil and destruction of a
magnitude equivalent to an actual war between the forces of our duly
constituted government and the New People's Army and their satellite
organizations because of the unmitigated forays, raids, ambuscades,
assaults, violence, murders, assassinations, acts of terror, deceits,
coercions, threats, intimidations, treachery, machinations, arsons,
 plunders and depredations committed and being committed by the
aforesaid lawless elements who have pledged to the whole nation that
they will not stop their dastardly effort and scheme until and unless they
have fully attained their primary and ultimate purpose of forcibly seizing
political and state power in this country by overthrowing our present duly
constituted government, ... (See Book I, Vital Documents on the
Declaration of Martial Law in the Philippines by the Supreme Court of the
Philippines, pp. 13-39)

It follows that it is only that act of carrying a blunt or bladed weapon with a motivation
connected with or related to the afore-quoted desired result of Proclamation 1081 that is
within the intent of P.D. 9(3), and nothing else.

Statutes are to be construed in the light of purposes to be achieved and

the evils sought to be remedied. (U.S. v. American Tracking Association,
310 U.S. 534, cited in LVN Pictures v. Philippine Musicians Guild, 110
Phil. 725, 731; emphasis supplied)

When construing a statute, the reason for its enactment should be kept in
mind, and the statute should be construed with reference to its intended
scope and purpose. (Statutory Construction by E.T. Crawford, pp. 604-
605, cited in Commissioner of Internal Revenue v. Filipinas Compania de
Seguros, 107 Phil. 1055, 1060; emphasis supplied)

5. In the construction of P.D. 9(3) it becomes relevant to inquire into the consequences
of the measure if a strict adherence to the letter of the paragraph is followed.

It is a salutary principle in statutory construction that there exists a valid presumption

that undesirable consequences were never intended by a legislative measure, and that
a construction of which the statute is fairly susceptible is favored, which will avoid all
objectionable, mischievous, indefensible, wrongful, evil, and injurious consequences.9-a

It is to be presumed that when P.D. 9 was promulgated by the President of the Republic
there was no intent to work a hardship or an oppressive result, a possible abuse of
authority or act of oppression, arming one person with a weapon to impose hardship on
another, and so on.10

At this instance We quote from the order of Judge Purisima the following:

And while there is no proof of it before the Court, it is not difficult to believe
the murmurings of detained persons brought to Court upon a charge of
possession of bladed weapons under P.D. No. 9, that more than ever
before, policemen - of course not all can be so heartless — now have in
their hands P.D. No. 9 as a most convenient tool for extortion, what with
the terrifying risk of being sentenced to imprisonment of five to ten years
for a rusted kitchen knife or a pair of scissors, which only God knows
where it came from. Whereas before martial law an extortion-minded
peace officer had to have a stock of the cheapest paltik, and even that
could only convey the coercive message of one year in jail, now anything
that has the semblance of a sharp edge or pointed object, available even
 in trash cans, may already serve the same purpose, and yet five to ten
times more incriminating than the infamous paltik. (pp. 72-73, rollo L-
42050-66)

And as respondent Judge Maceren points out, the people's interpretation of P.D. 9(3)
results in absurdity at times. To his example We may add a situation where a law-
abiding citizen, a lawyer by profession, after gardening in his house remembers to
return the bolo used by him to his neighbor who lives about 30 meters or so away and
while crossing the street meets a policeman. The latter upon seeing the bolo being
carried by that citizen places him under arrest and books him for a violation of P.D. 9(3).
Could the presidential decree have been conceived to produce such absurd,
unreasonable, and insensible results?

6. Penal statutes are to be construed strictly against the state and liberally in favor of an
accused.

American jurisprudence sets down the reason for this rule to be "the tenderness of the
law of the rights of individuals; the object is to establish a certain rule by conformity to
which mankind would be safe, and the discretion of the court limited." 11 The purpose is
not to enable a guilty person to escape punishment through a technicality but to provide
a precise definition of forbidden acts.12

Our own decisions have set down the same guidelines in this manner, viz:

Criminal statutes are to be construed strictly. No person should be brought

within their terms who is not clearly within them, nor should any act be
pronounced criminal which is not made clearly so by the statute. (U.S. v.
Abad Santos, 36 Phil. 243, 246)

The 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. (People v. Manantan, 5 SCRA
684, 692)

F. The Informations filed by petitioner are fatally defective.

The two elements of the offense covered by P.D. 9(3) must be alleged in the
Information in order that the latter may constitute a sufficiently valid charged. The
sufficiency of an Information is determined solely by the facts alleged therein.13 Where
the facts are incomplete and do not convey the elements of the crime, the quashing of
the accusation is in order.

Section 2(a), Rule 117 of the Rules of Court provides that the defendant may move to
quash the complaint or information when the facts charged do not constitute an offense.

In U.S.U. Gacutan, 1914, it was held that where an accused is charged with knowingly
rendering an unjust judgment under Article 204 of the Revised Penal Code, failure to
allege in the Information that the judgment was rendered knowing it to be unjust, is fatal.
14
In People v. Yadao, 1954, this Court through then Justice Cesar Bengzon who later
became Chief Justice of the Court affirmed an order of the trial court which quashed an
Information wherein the facts recited did not constitute a public offense as defined in
Section 1, Republic Act 145. 15

G. The filing of these Petitions was unnecessary because the People could have
availed itself of other available remedies below.

Pertinent provisions of the Rules of Court follow:

Rule 117, Section 7. Effect of sustaining the motion to quash. — If the

motion to quash is sustained the court may order that another information
be filed. If such order is made the defendant, if in custody, shall remain so
unless he shall be admitted to bail. If such order is not made or if having
been made another information is not filed withuntime to be specified in
the order, or within such further time as the court may allow for good
cause shown, the defendant, if in custody, shall be discharged therefrom,
unless he is in custody on some other charge.

Rule 110, Section 13. Amendment. — The information or complaint may

be amended, in substance or form, without leave of court, at any time
before the defendant pleads; and thereafter and during the trial as to all
matters of form, by leave and at the discretion of the court, when the same
can be done without prejudice to the rights of the defendant.

xxx xxx xxx

Two courses of action were open to Petitioner upon the quashing of the Informations in
these cases, viz:

First, if the evidence on hand so warranted, the People could have filed an amended
Information to include the second element of the offense as defined in the disputed
orders of respondent Judges. We have ruled that if the facts alleged in the Information
do not constitute a punishable offense, the case should not be dismissed but the
prosecution should be given an opportunity to amend the Information.16

Second, if the facts so justified, the People could have filed a complaint either under
Section 26 of Act No. 1780, quoted earlier, or Manila City Ordinance No. 3820, as
amended by Ordinance No. 3928, especially since in most if not all of the cases, the
dismissal was made prior to arraignment of the accused and on a motion to quash.

Section 8. Rule 117 states that:

An order sustaining the motion to quash is not a bar to another

prosecution for the same offense unless the motion was based on the
grounds specified in section 2, subsections (f) and (h) of this rule.

Under the foregoing, the filing of another complaint or Information is barred only when
the criminal action or liability had been extinguished (Section 2[f]) or when the motion to
quash was granted for reasons of double jeopardy. (ibid., [h])
As to whether or not a plea of double jeopardy may be successfully invoked by the
accused in all these cases should new complaints be filed against them, is a matter We
need not resolve for the present.

H. — We conclude with high expectations that police authorities and the prosecuting
arm of the government true to the oath of office they have taken will exercise utmost
circumspection and good faith in evaluating the particular circumstances of a case so as
to reach a fair and just conclusion if a situation falls within the purview of P.D. 9(3) and
the prosecution under said decree is warranted and justified. This obligation becomes a
sacred duty in the face of the severe penalty imposed for the offense.

On this point, We commend the Chief State Prosecutor Rodolfo A. Nocon on his letter
to the City Fiscal of Manila on October 15, 1975, written for the Secretary, now Minister
of Justice, where he stated the following:

In any case, please study well each and every case of this nature so that
persons accused of carrying bladed weapons, specially those whose
purpose is not to subvert the duly constituted authorities, may not be
unduly indicted for the serious offenses falling under P.D. No. 9.17

Yes, while it is not within the power of courts of justice to inquire into the wisdom of a
law, it is however a judicial task and prerogative to determine if official action is within
the spirit and letter of the law and if basic fundamental rights of an individual guaranteed
by the Constitution are not violated in the process of its implementation. We have to
face the fact that it is an unwise and unjust application of a law, necessary and justified
under prevailing circumstances, which renders the measure an instrument of
oppression and evil and leads the citizenry to lose their faith in their government.

WHEREFORE, We DENY these 26 Petitions for Review and We AFFIRM the Orders of
respondent Judges dismissing or quashing the Information concerned, subject however
to Our observations made in the preceding pages 23 to 25 of this Decision regarding
the right of the State or Petitioner herein to file either an amended Information under
Presidential Decree No. 9, paragraph 3, or a new one under other existing statute or city
ordinance as the facts may warrant.

Without costs.

SO ORDERED.

Fernando, Teehankee, Santos, Fernandez and Guerrero, JJ., concur.

Castro, C.J. and Antonio, J, concur in the result.

Aquino, J, took no part.

G.R. No. L-69809 October 16, 1986

EDGARDO A. GAANAN, petitioner,
vs.
INTERMEDIATE APPELLATE COURT and PEOPLE OF THE PHILIPPINES,
respondents.

GUTIERREZ, JR., J.:

This petition for certiorari asks for an interpretation of Republic Act (RA) No. 4200,
otherwise known as the Anti-Wiretapping Act, on the issue of whether or not an
extension telephone is among the prohibited devices in Section 1 of the Act, such that
its use to overhear a private conversation would constitute unlawful interception of
communications between the two parties using a telephone line.

The facts presented by the People and narrated in the respondent court's decision are
not disputed by the petitioner.

In the morning of October 22, 1975, complainant Atty. Tito Pintor and his
client Manuel Montebon were in the living room of complainant's residence
discussing the terms for the withdrawal of the complaint for direct assault
which they filed with the Office of the City Fiscal of Cebu against Leonardo
Laconico. After they had decided on the proposed conditions, complainant
made a telephone call to Laconico (tsn, August 26, 1981, pp. 3-5).

That same morning, Laconico telephoned appellant, who is a lawyer, to

come to his office and advise him on the settlement of the direct assault
case because his regular lawyer, Atty. Leon Gonzaga, went on a business
trip. According to the request, appellant went to the office of Laconico
where he was briefed about the problem. (Exhibit 'D', tsn, April 22, 1982,
pp. 4-5).

When complainant called up, Laconico requested appellant to secretly

listen to the telephone conversation through a telephone extension so as
to hear personally the proposed conditions for the settlement. Appellant
heard complainant enumerate the following conditions for withdrawal of
the complaint for direct assault.

(a) the P5,000.00 was no longer acceptable, and that the figure had been
increased to P8,000.00. A breakdown of the P8,000.00 had been made
together with other demands, to wit: (a) P5,000.00 no longer for the
teacher Manuel Montebon, but for Atty. Pintor himself in persuading his
client to withdraw the case for Direct Assault against Atty. Laconico before
the Cebu City Fiscal's Office;

(b) Public apology to be made by Atty. Laconico before the students of

Don Bosco Technical High School;

(c) Pl,000.00 to be given to the Don Bosco Faculty club;

 (d) transfer of son of Atty. Laconico to another school or another section of
Don Bosco Technical High School;

(e) Affidavit of desistance by Atty. Laconico on the Maltreatment case

earlier filed against Manuel Montebon at the Cebu City Fiscal's Office,
whereas Montebon's affidavit of desistance on the Direct Assault Case
against Atty. Laconico to be filed later;

(f) Allow Manuel Montebon to continue teaching at the Don Bosco

Technical School;

(g) Not to divulge the truth about the settlement of the Direct Assault Case
to the mass media;

(h) P2,000.00 attorney s fees for Atty. Pintor. (tsn, August 26, 1981, pp.
47-48).

Twenty minutes later, complainant called up again to ask Laconico if he

was agreeable to the conditions. Laconico answered 'Yes'. Complainant
then told Laconico to wait for instructions on where to deliver the money.
(tsn, March 10, 1983, pp. 2-12).

Complainant called up again and instructed Laconico to give the money to

his wife at the office of the then Department of Public Highways. Laconico
who earlier alerted his friend Colonel Zulueta of the Criminal Investigation
Service of the Philippine Constabulary, insisted that complainant himself
should receive the money. (tsn, March 10, 1982, pp. 26-33). When he
received the money at the Igloo Restaurant, complainant was arrested by
agents of the Philippine Constabulary.

Appellant executed on the following day an affidavit stating that he heard

complainant demand P8,000.00 for the withdrawal of the case for direct
assault. Laconico attached the affidavit of appellant to the complainant for
robbery/extortion which he filed against complainant. Since appellant
listened to the telephone conversation without complainant's consent,
complainant charged appellant and Laconico with violation of the Anti-
Wiretapping Act.

After trial on the merits, the lower court, in a decision dated November 22, 1982, found
both Gaanan and Laconico guilty of violating Section 1 of Republic Act No. 4200. The
two were each sentenced to one (1) year imprisonment with costs. Not satisfied with the
decision, the petitioner appealed to the appellate court.

On August 16, 1984, the Intermediate Appellate Court affirmed the decision of the trial
court, holding that the communication between the complainant and accused Laconico
was private in nature and, therefore, covered by Rep. Act No. 4200; that the petitioner
overheard such communication without the knowledge and consent of the complainant;
and that the extension telephone which was used by the petitioner to overhear the
telephone conversation between complainant and Laconico is covered in the term
"device' as provided in Rep. Act No. 4200.
In this petition for certiorari, the petitioner assails the decision of the appellate court and
raises the following issues; (a) whether or not the telephone conversation between the
complainant and accused Laconico was private in nature; (b) whether or not an
extension telephone is covered by the term "device or arrangement" under Rep. Act No.
4200; (c) whether or not the petitioner had authority to listen or overhear said telephone
conversation and (d) whether or not Rep. Act No. 4200 is ambiguous and, therefore,
should be construed in favor of the petitioner.

Section 1 of Rep. Act No. 4200 provides:

Section 1. It shall be unlawful for any person, not being authorized by all
the parties to any private communication or spoken word, to tap any wire
or cable or by using any other device or arrangement, to secretly
overhear, intercept, or record such communication or spoken word by
using a device commonly known as a dictaphone or dictagraph or
detectaphone or walkie-talkie or tape-recorder, or however otherwise
described:

It shall be unlawful for any person, be he a participant or not in the act or

acts penalized in the next preceeding sentence, to knowingly possess any
tape record, wire record, disc record, or any other such record, or copies
thereof, of any communication or spoken word secured either before or
after the effective date of this Act in the manner prohibited by this law; or
to replay the same for any other person or persons; or to communicate the
contents thereof, either verbally or in writing, or to furnish transcriptions
thereof, whether complete or partial, to any other person: Provided, that
the use of such record or any copies thereof as evidence in any civil,
criminal investigation or trial of offenses mentioned in Section 3 hereof,
shall not be covered by this prohibition.

We rule for the petitioner.

We are confronted in this case with the interpretation of a penal statute and not a rule of
evidence. The issue is not the admissibility of evidence secured over an extension line
of a telephone by a third party. The issue is whether or not the person called over the
telephone and his lawyer listening to the conversation on an extension line should both
face prison sentences simply because the extension was used to enable them to both
listen to an alleged attempt at extortion.

There is no question that the telephone conversation between complainant Atty. Pintor
and accused Atty. Laconico was "private" in the sense that the words uttered were
made between one person and another as distinguished from words between a speaker
and a public. It is also undisputed that only one of the parties gave the petitioner the
authority to listen to and overhear the caller's message with the use of an extension
telephone line. Obviously, complainant Pintor, a member of the Philippine bar, would
not have discussed the alleged demand for an P8,000.00 consideration in order to have
his client withdraw a direct assault charge against Atty. Laconico filed with the Cebu
City Fiscal's Office if he knew that another lawyer was also listening. We have to
consider, however, that affirmance of the criminal conviction would, in effect, mean that
a caller by merely using a telephone line can force the listener to secrecy no matter how
obscene, criminal, or annoying the call may be. It would be the word of the caller
against the listener's.

Because of technical problems caused by the sensitive nature of electronic equipment

and the extra heavy loads which telephone cables are made to carry in certain areas,
telephone users often encounter what are called "crossed lines". An unwary citizzen
who happens to pick up his telephone and who overhears the details of a crime might
hesitate to inform police authorities if he knows that he could be accused under Rep.
Act 4200 of using his own telephone to secretly overhear the private communications of
the would be criminals. Surely the law was never intended for such mischievous results.

The main issue in the resolution of this petition, however, revolves around the meaning
of the phrase "any other device or arrangement." Is an extension of a telephone unit
such a device or arrangement as would subject the user to imprisonment ranging from
six months to six years with the accessory penalty of perpetual absolute disqualification
for a public officer or deportation for an alien? Private secretaries with extension lines to
their bosses' telephones are sometimes asked to use answering or recording devices to
record business conversations between a boss and another businessman. Would
transcribing a recorded message for the use of the boss be a proscribed offense? or for
that matter, would a "party line" be a device or arrangement under the law?

The petitioner contends that telephones or extension telephones are not included in the
enumeration of "commonly known" listening or recording devices, nor do they belong to
the same class of enumerated electronic devices contemplated by law. He maintains
that in 1964, when Senate Bill No. 9 (later Rep. Act No. 4200) was being considered in
the Senate, telephones and extension telephones were already widely used
instruments, probably the most popularly known communication device.

Whether or not listening over a telephone party line would be punishable was discussed
on the floor of the Senate. Yet, when the bill was finalized into a statute, no mention was
made of telephones in the enumeration of devices "commonly known as a dictaphone or
dictagraph, detectaphone or walkie talkie or tape recorder or however otherwise
described." The omission was not a mere oversight. Telephone party lines were
intentionally deleted from the provisions of the Act.

The respondent People argue that an extension telephone is embraced and covered by
the term "device" within the context of the aforementioned law because it is not a part or
portion of a complete set of a telephone apparatus. It is a separate device and distinct
set of a movable apparatus consisting of a wire and a set of telephone receiver not
forming part of a main telephone set which can be detached or removed and can be
transferred away from one place to another and to be plugged or attached to a main
telephone line to get the desired communication corning from the other party or end.

The law refers to a "tap" of a wire or cable or the use of a "device or arrangement" for
the purpose of secretly overhearing, intercepting, or recording the communication.
There must be either a physical interruption through a wiretap or the deliberate
installation of a device or arrangement in order to overhear, intercept, or record the
spoken words.
An extension telephone cannot be placed in the same category as a dictaphone,
dictagraph or the other devices enumerated in Section 1 of RA No. 4200 as the use
thereof cannot be considered as "tapping" the wire or cable of a telephone line. The
telephone extension in this case was not installed for that purpose. It just happened to
be there for ordinary office use. It is a rule in statutory construction that in order to
determine the true intent of the legislature, the particular clauses and phrases of the
statute 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. (see
Commissioner of Customs v. Esso Estandard Eastern, Inc., 66 SCRA 113,120).

In the case of Empire Insurance Com any v. Rufino (90 SCRA 437, 443-444), we ruled:

Likewise, Article 1372 of the Civil Code stipulates that 'however general
the terms of a contract may be, they shall not be understood to
comprehend things that are distinct and cases that are different from those
upon which the parties intended to agree.' Similarly, Article 1374 of the
same Code provides that 'the various stipulations of a contract shall be
interpreted together, attributing to the doubtful ones that sense which may
result from all of them taken jointly.

xxx xxx xxx

Consequently, the phrase 'all liabilities or obligations of the decedent' used

in paragraph 5(c) and 7(d) should be then restricted only to those listed in
the Inventory and should not be construed as to comprehend all other
obligations of the decedent. The rule that 'particularization followed by a
general expression will ordinarily be restricted to the former' is based on
the fact in human experience that usually the minds of parties are
addressed specially to the particularization, and that the generalities,
though broad enough to comprehend other fields if they stood alone, are
used in contemplation of that upon which the minds of the parties are
centered. (Hoffman v. Eastern Wisconsin R., etc., Co., 134 Wis. 603, 607,
115 NW 383, cited in Francisco, Revised Rules of Court (Evidence), 1973
ed, pp. 180-181).

Hence, the phrase "device or arrangement" in Section 1 of RA No. 4200, although not
exclusive to that enumerated therein, should be construed to comprehend instruments
of the same or similar nature, that is, instruments the use of which would be tantamount
to tapping the main line of a telephone. It refers to instruments whose installation or
presence cannot be presumed by the party or parties being overheard because, by their
very nature, they are not of common usage and their purpose is precisely for tapping,
intercepting or recording a telephone conversation.

An extension telephone is an instrument which is very common especially now when

the extended unit does not have to be connected by wire to the main telephone but can
be moved from place ' to place within a radius of a kilometer or more. A person should
safely presume that the party he is calling at the other end of the line probably has an
extension telephone and he runs the risk of a third party listening as in the case of a
party line or a telephone unit which shares its line with another. As was held in the case
of Rathbun v. United States (355, U.S. 107, 2 L Ed 2d 137-138):
 Common experience tells us that a call to a particular telephone number
may cause the bell to ring in more than one ordinarily used instrument.
Each party to a telephone conversation takes the risk that the other party
may have an extension telephone and may allow another to overhear the
conversation. When such takes place there has been no violation of any
privacy of which the parties may complain. Consequently, one element of
605, interception, has not occurred.

In the same case, the Court further ruled that the conduct of the party would differ in no
way if instead of repeating the message he held out his hand-set so that another could
hear out of it and that there is no distinction between that sort of action and permitting
an outsider to use an extension telephone for the same purpose.

Furthermore, it is a general rule that penal statutes must be construed strictly in favor of
the accused. Thus, in case of doubt as in the case at bar, on whether or not an
extension telephone is included in the phrase "device or arrangement", the penal statute
must be construed as not including an extension telephone. In the case of People v.
Purisima, 86 SCRA 542, 562, we explained the rationale behind the rule:

American jurisprudence sets down the reason for this rule to be the
tenderness of the law of the rights of individuals; the object is to establish
a certain rule by conformity to which mankind would be safe, and the
discretion of the court limited. (United States v. Harris, 177 US 305, 44 L
Ed 780, 20 S Ct 609; Braffith v. Virgin Islands (CA3) 26 F2d 646; Caudill v.
State, 224 Ind 531, 69 NE2d; Jennings v. Commonwealth, 109 VA 821,63
SE 1080, all cited in 73 Am Jur 2d 452). The purpose is not to enable a
guilty person to escape punishment through a technicality but to provide a
precise definition of forbidden acts." (State v. Zazzaro, 20 A 2d 737,
quoted in Martin's Handbook on Statutory Construction, Rev. Ed. pp. 183-
184).

In the same case of Purisima, we also ruled that on the construction or interpretation of
a legislative measure, the primary rule is to search for and determine the intent and
spirit of the law. A perusal of the Senate Congressional Records will show that not only
did our lawmakers not contemplate the inclusion of an extension telephone as a
prohibited device or arrangement" but of greater importance, they were more concerned
with penalizing the act of recording than the act of merely listening to a telephone
conversation.

xxx xxx xxx

Senator Tañada. Another possible objection to that is

entrapment which is certainly objectionable. It is made
possible by special amendment which Your Honor may
introduce.

Senator Diokno.Your Honor, I would feel that entrapment

would be less possible with the amendment than without it,
because with the amendment the evidence of entrapment
would only consist of government testimony as against the
 testimony of the defendant. With this amendment, they
would have the right, and the government officials and the
person in fact would have the right to tape record their
conversation.

Senator Tañada. In case of entrapment, it would be the

government.

Senator Diokno. In the same way, under this provision,

neither party could record and, therefore, the court would be
limited to saying: "Okay, who is more credible, the police
officers or the defendant?" In these cases, as experienced
lawyers, we know that the Court go with the peace offices.

(Congressional Record, Vol. 111, No. 33, p. 628, March 12,

1964).

xxx xxx xxx

Senator Diokno. The point I have in mind is that under these

conditions, with an agent outside listening in, he could falsify
the testimony and there is no way of checking it. But if you
allow him to record or make a recording in any form of what
is happening, then the chances of falsifying the evidence is
not very much.

Senator Tañada. Your Honor, this bill is not intended to

prevent the presentation of false testimony. If we could
devise a way by which we could prevent the presentation of
false testimony, it would be wonderful. But what this bill
intends to prohibit is the use of tape record and other
electronic devices to intercept private conversations which
later on will be used in court.

(Congressional Record, Vol. III, No. 33, March 12, 1964, p.

629).

It can be readily seen that our lawmakers intended to discourage, through punishment,
persons such as government authorities or representatives of organized groups from
installing devices in order to gather evidence for use in court or to intimidate, blackmail
or gain some unwarranted advantage over the telephone users. Consequently, the
mere act of listening, in order to be punishable must strictly be with the use of the
enumerated devices in RA No. 4200 or others of similar nature. We are of the view that
an extension telephone is not among such devices or arrangements.

WHEREFORE, the petition is GRANTED. The decision of the then Intermediate

Appellate Court dated August 16, 1984 is ANNULLED and SET ASIDE. The petitioner is
hereby ACQUITTED of the crime of violation of Rep. Act No. 4200, otherwise known as
the Anti-Wiretapping Act.
SO ORDERED.

2. PROBATION LAWS
[G.R. No. 125108. August 3, 2000.]

ALEJANDRA PABLO, Petitioner, v. HON. SILVERIO Q. CASTILLO, Presiding

Judge, Branch 43, Regional Trial Court, First and Judicial Region, Dagupan City
and PEOPLE of the PHILIPPINES, Respondents.

DECISION

PURISIMA, J.:

At bar is an original petition for certiorari under Rule 65 of the Rules of Court imputing
grave abuse of discretion amounting to lack or excess of jurisdiction to the Regional
Trial Court, Branch 43, Dagupan City, for denying petitioner’s application for probation
and the motion for reconsideration of two Orders dated March 25, 1996 and April 29,
1996, respectively.chanrob1es virtua1 1aw 1ibrary

The antecedent facts are as follows:chanrob1es virtual 1aw library

On January 12, 1994, petitioner Alejandra Pablo was charged with a violation of Batas
Pambansa Bilang 22, otherwise known as the Bouncing Checks Law, in three separate
Informations, for issuing three bad checks in the total amount of 92,334.00 each to
complainant Nelson Mandap.

All three Informations alleged that on or about the 25th of May, 1993, petitioner did then
and there willfully, unlawfully and criminally draw, issue and deliver various checks to
Nelson Mandap, in partial payment of a loan she obtained from him, knowing that at the
time of the issuance of such checks, she did not have sufficient funds in or credit with
the bank. Subject checks were dishonored by the drawee bank upon presentment for
payment, it appearing that the current account of petitioner had been closed, and she
failed to pay the amount or make arrangements for the payment thereof, despite notice
of dishonor.

Docketed as Criminal Cases Nos. 94-00197-D, 94-00198-D and 94-00199-D,

respectively, the three cases were not consolidated. The first two were raffled and
assigned to Branch 43 while the third case to Branch 41 of the Regional Trial Court in
Dagupan City.

On June 21, 1995, Branch 41 of the said lower court rendered judgment in Criminal
Case No. 944199-D, convicting petitioner of the crime charged and imposing upon her a
fine of P4, 648.00.
On November 28, 1995, Branch 43 promulgated its decision in Criminal Cases Nos. 94-
00197-D and 94-00198-D, finding petitioner guilty of violating B.P. Blg. 22, and
sentencing her to pay the amount of P4,668.00 and to serve a prison term of thirty (30)
days in each case.chanrob1es virtua1 1aw 1ibrary

Petitioner applied for probation in Criminal Cases Nos. 94-00197-D and 94-00198-D.
Her application was given due course and the probation office was required to submit a
post-sentence investigation report.

On March 25, 1996, the probation office arrived at a favorable evaluation on the
suitability of petitioner for probation. However, the recommendation of the local
probation office was overruled by the National Probation Office. It denied petitioner’s
application for probation on the ground that the petitioner is disqualified under Section 9
of P.D. 968 (Probation Law). Respondent judge denied petitioner’s application for
probation in the Order dated March 25, 1996. Petitioner moved for reconsideration but
to no avail. The same was denied on April 29, 1996.

Undaunted, petitioner brought the present petition.

The sole issue for resolution here is whether or not the respondent court acted with
grave abuse of discretion in denying petitioner’s application for probation on the ground
of disqualification from probation under Section 9 of P.D. 968.

Under Section 9 of the Probation Law, P.D. 968, the following offenders cannot avail of
the benefits of probation:chanrob1es virtual 1aw library

a) those sentenced to serve a maximum term of imprisonment of more than six years;

b) those convicted of subversion or any crime against the national security or the public
order;

c) those who have previously been convicted by final judgment of an offense punished
by imprisonment of not less than one month and one day and/or fine of not less than
two hundred pesos;chanrob1es virtua1 1aw 1ibrary

d) those who have been once on probation under the provisions of this Decree; and

e) those who are already serving sentence at the time the substantive provisions of this
Decree became applicable pursuant to Section 33 hereof.

The National Probation Office denied petitioner’s application for probation under Section
9 paragraph (c) P.D. 968 because a prior conviction was entered against the petitioner
on June 21, 1995 in Criminal Case No. 94-0199, penalizing her with a fine of P4,648.00;
thereby placing her within the ambit of disqualification from probation under Section 9
paragraph (c) of P.D. 968.chanrob1es virtua1 1aw 1ibrary

Petitioner assails the denial of her application for probation; invoking the ruling of this
Court in several cases favoring liberal interpretation of the provisions of P.D. 968 so as
to afford first offenders a second chance to reform in consonance with the avowed
purpose and objective of the Probation Law. She theorized that "previous conviction"
under Section 9 paragraph (c) should not be literally and strictly interpreted but should
rather be understood as referring to a situation wherein the accused was previously
convicted of a crime that arose differently, or was done on a different date, from the
conviction of a crime for which probation is applied for. It is contended by petitioner that
Section 9 paragraph (c) should not refer, as in her particular case, where several crimes
arose out of a single act or transaction.

To buttress her stance, petitioner placed reliance on this Court’s ruling in Rura v.
Lopeña 1 In the said case, the accused was convicted of five counts of estafa
committed on different dates. He was able to consolidate the five cases in a single sala
such that the judgment of conviction against him in all the five cases was embodied in a
single decision entered on the same date. When the accused applied for probation, the
same was denied but on appeal, this Court granted the application for probation;
ratiocinating thus:jgc:chanrobles.com.ph

". . . 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. The statute relates "previous" to the date of conviction, not the
date of the commission of the crime." (Emphasis ours)chanrob1es virtua1 1aw 1ibrary

Precisely because of the aforecited ruling in Rura v. Lopeña the petition under scrutiny
cannot prosper.

It is a basic rule of statutory construction that if a statute is clear, plain and free from
ambiguity, it must be given its literal meaning and applied without any interpretation. 2
Not only that; in the matter of interpretation of laws on probation, the Court has
pronounced that "the policy of liberality of probation statutes cannot prevail against the
categorical provisions of the law." 3

Section 9 paragraph (c) is in clear and plain language, to the effect that a person who
was previously convicted by final judgment of an offense punishable by imprisonment of
not less than one month and one day and/or a fine of not less than two hundred pesos,
is disqualified from applying for probation. This provision of law is definitive and
unqualified. There is nothing in Section 9, paragraph (c) which qualifies "previous
conviction as referring to a conviction for a crime which is entirely different from that for
which the offender is applying for probation or a crime which arose out of a single act or
transaction as petitioner would have the court to understand.chanrob1es virtua1 1aw
1ibrary

In the case of Rura v. Lopeña relied upon by petitioner, the Court declared that
"previous" refers to conviction, and not to commission of a crime. At the time Rura was
convicted of the crime for which he was applying for probation, he had no prior
conviction. In the present case of petitioner, when she applied for probation in Criminal
Cases Nos. 94-00197-D and 94-00198-D, she had a previous conviction in Criminal
Case No. 94-00199-D, which thereby disqualified her from the benefits of probation.

It is well-settled that the probation law is not a penal statute; 4 and therefore, the
principle of liberal interpretation is inapplicable. And when the meaning is clearly
discernible from the language of the statute, there is no room for construction or
interpretation.chanrob1es virtua1 1aw 1ibrary
WHEREFORE, for want of merit, the petition is hereby DISMISSED. No pronouncement
as to costs.

SO ORDERED.

Melo, Vitug, Panganiban and Gonzaga-Reyes, JJ., concur.

3. TAX LAWS

G.R. No. L-18924 June 30, 1964

MARINDUQUE IRON MINES AGENTS, INC., petitioner-appellee, vs. THE MUNICIPAL

COUNCIL OF THE MUNICIPALITY OF HINABANGAN, PROVINCE OF SAMAR, ET
AL., respondents-appellants.

Santiago de los Reyes and Francisco C. Catral for petitioner-appellee.

Eliseo de Veyra and Juan Figueroa for defendants-appellants.

REYES, J.B.L., J.:chanrobles virtual law library

Appeal from a declaratory decision of the Court of First Instance of Manila declaring
Municipal Ordinance No. 7, Series of 1960, of the Municipality of Hinabangan, Samar,
null and void.chanroblesvirtualawlibrarychanrobles virtual law library

On June 27, 1960, the Municipality of Hinabangan, through its duly constituted
Municipality Council, enacted Ordinance No. 7, Series of 1960, which in full reads as
follows:

An Ordinance Imposing a Municipal License Tax On the Gross Outputs of the Mines
and Other Business; Its Imposition and Penalties Thereof Within the Jurisdiction of this
Municipality.chanroblesvirtualawlibrarychanrobles virtual law library

Be it ordained by the Municipal Council of Hinabangan. Samar, THAT: chanrobles

virtual law library

Section 1. - For the purpose of this Ordinance, the following terms are defined:
chanrobles virtual law library

"CORPORATION" refers to any person or persons, firm or association engaged in the

business for which this Ordinance is enacted.chanroblesvirtualawlibrarychanrobles
virtual law library

"GROSS OUTPUTS" shall be interpreted as the total actual market value of minerals or
mineral products from each mine or mineral land operated as separate entity without
any deduction on expenses incurred in the operation of the
business.chanroblesvirtualawlibrarychanrobles virtual law library
"MUNICIPAL TREASURER" herein referred to, is the duly appointed Municipal
Treasurer including his authorized representatives and/or deputies in his
office.chanroblesvirtualawlibrarychanrobles virtual law library

Section 2. - Republic Act 2264 empowers the Municipal Council of Hinabangan, Samar,
to impose a graduated Municipal License Fees on any occupation or business in the
municipality to any Corporation, based on the gross outputs or in accordance with
following schedule:

MINES AND OTHER BUSINESS

Amount of Tax
Yearly Gross Output or Sales
to be Levied
P 50,000.00 to P 100,000.00 - P 100.00
P 100,001.00 to P 500,000.00 - P 1,000.00
P 500,001.00 to P 1,500,000.00 - P 7,500.00
P 1,500,001.00 to P 3,500,000.00 - P 26,250.00
P 3,500,001.00 to P 7,500,000.00 - P 75,000.00
P 7,500,001.00 to P 13,500,000.00 - P 168,750.00
P 13,500,001.00 to P 23,500,000.00 - P 352,500.00
P 23,500,001.00 to P 50,000,000.00 - P 875,000.00
P 50,000,001.00 to P up - P 1,000,000.00

Section 3. - Any corporation subject to payment of the Municipal License herein

imposed shall immediately at the end of each calendar year, but in no case shall it
exceed beyond the first FIFTEEN (15) DAYS of the succeeding year, submit to
Municipal Treasurer certified true copies of receipts and/or invoices as the case may be
on the total output per shipment of the mining produce, for the year or the total yearly
sales which will serve as the basis for the collection of the Municipal License Tax
PROVIDED that upon subsequent verification by the Municipal Treasurer no erroneous
or fraudulent entries are made. On the contrary when upon proper investigation and
examination of the Books and/or Records of the Corporation, there shall be found
discrepancies in the declarations of the total output per shipment or sales, such
discrepancy shall be revised within TEN (10) DAYS from the date of verification within
which to settle the taxes due without penalties as provided for by
law.chanroblesvirtualawlibrarychanrobles virtual law library

Section 4. - To enforce this Ordinance, the Municipal Treasurer shall have authority to
examine the Books and Records of the Corporation subject to the payment of tax herein
levied, PROVIDED that such examination of Records or Books as the case may be, be
made during Office hours, unless a written consent from the President, or Manager as
the case may be of the Corporation is secured.chanroblesvirtualawlibrarychanrobles
virtual law library
Section 5. - Any violation of a provision of this Ordinance is punishable by a fine of not
less than ONE HUNDRED (P100.00) PESOS nor more than TWO HUNDRED
(P200.00) PESOS or by an imprisonment of not less than ONE (1) MONTH nor more
than SIX (6) MONTHS or both fine and imprisonment in the discretion of the Court. Any
violation of Section 2 of this Ordinance shall subject the Corporation to pay the tax
imposed plus penalties and the subsequent fine and imprisonment promulgated by the
Court. Criminal responsibility rests on the President, Manager or any person charged
with the management of the Corporation.chanroblesvirtualawlibrarychanrobles virtual
law library

Section 6. - All Ordinances or parts thereof in conflict with the Present Ordinance are
hereby repealed.chanroblesvirtualawlibrarychanrobles virtual law library

Section 7. - This Ordinance shall take effect FIFTEEN (15) DAYS from its approval.

On December 14, 1960, the petitioner, a corporation duly organized and existing under
the laws of the Philippines and operating the only mine within the jurisdiction of the
municipality of Hinabangan, filed this case of declaratory relief in the Court of First
Instance of Manila questioning the validity of the ordinance as enacted without authority
and in violation of law. Respondents answered averring the ordinance's validity with a
counterclaim for damages and petitioner having filed an amended petition and answer
to the counterclaim, which amended petition was accordingly answered by respondents,
the case was tried by the Court a quo on March 15, 1961; the parties filed respective
memoranda, and on April 4, 1961 the Court a quo rendered its decision declaring the
ordinance in question illegal, from which judgment respondents in due time perfected
their appeal to this Court.chanroblesvirtualawlibrarychanrobles virtual law library

Neither petitioner-appellee nor respondents-appellants adduced any evidence before

the Court a quo, the facts heretofore stated having been based on the allegations of the
amended petition and the admissions thereof in the appellants' amended answer
thereto and the case was submitted for decision on the
pleadings.chanroblesvirtualawlibrarychanrobles virtual law library

Respondents-appellants maintain in this appeal that the Court a quo erred in finding that
Ordinance No. 7 does impose a tax; that Ordinance No. 7 was intended to impose a tax
on sales; that Ordinance No. 7 is illegal because it is an imposition of a double taxation,
and that Ordinance No. 7 is null and void.chanroblesvirtualawlibrarychanrobles virtual
law library

On the petitioner-appellee's side, they maintain that Section 2 of Municipal Ordinance

No. 7 does not impose a tax or levy, and there is no clear and express imposition of a
charge in the other provisions of the ordinance; that the declaration of authority to
impose a tax is false and erroneous because no such power is conferred in Section 2 of
Republic Act No. 2264 upon which such authority is based; that, moreover, there is no
finding by the Court a quo that a tax was imposed, much less, that the same is based
on the gross outputs or sales, because the Court a quo merely assumed that the tax is
imposed and declared it illegal as not within the Municipal Council's authority to impose
because it falls within the exceptions to the tax-in-powers of municipal governments, as
prescribed in Section 2, last paragraph, of the Local Autonomy Act (R.A. No.
2264).chanroblesvirtualawlibrarychanrobles virtual law library
We find no error in the decision appealed from in so far as it holds that the ordinance in
question fails to levy any tax. Appellants admit in their brief that the main section
(section 2) of the ordinance "seems merely declaratory of authority," albeit they aver
that a reading of it as a whole leads to the conclusion that a tax was intended. It is,
however, a well established rule that -

A statute will not be construed as imposing a tax unless does so clearly, expressly and
it unambiguously. (82 C.J.S., 956) (Emphasis supplied)

and that -

It is an ancient principle that a tax can not 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. (30 Am. Jur. 153; also McQuillin on
Municipal Corp., Vol. 16, p. 267; emphasis ours)

A mere reading of the ordinance discloses that not only are there no words therein
imposing a tax but that the peruser is left in doubt as to whether the intention is to levy a
tax for revenue or charge a fee for permitting the business to be carried on; for section 2
declares that the law "empowers the Municipal Council of Hinabangan, Samar to
impose graduated Municipal License Fecs." Since the validity of taxes and license fees
are governed by different principles, the taxpayer is left in doubt as to the true nature of
the charge and whether he must bear it or not. The rule is that taxes may not be
imposed by implication,1 and "a tax statute is to be construed strictly and against the
subjection to a tax liability where the question is whether a matter, property or person is
subject to the tax" (82 C.J.S., p. 957). Considering the avoidability of taxes by the
citizen, it seems that the least he is entitled to is to be expressly required to pay a tax,
which the words of the questioned ordinance do not state. This is particularly true where
the ordinance, as in this case, carries penal
provisions.chanroblesvirtualawlibrarychanrobles virtual law library

We further agree with the judgment appealed from that Ordinance No. 7, Ser. 1960, of
Hinabangan, Samar, is invalid because the same infringes upon the express restrictions
placed by the legislature upon the taxing power delegated to city and municipal
councils. Section 2, paragraph 1, of Republic Act No. 2264, after conferring power to
cities, municipalities, and municipal districts to impose license taxes and service fees or
charges on business and occupations, expressly limited said powers by the following
proviso:

Provided that municipalities and municipal districts shall, in no case, impose any
percentage tax on sales or other taxes in any form based thereon; ... .

Even granting that it does impose a tax, the ordinance in question, while not providing
for a percentage tax, but a graduated tax (the progressive tax therein imposed not being
calculated on a percentage of the sales made by the taxpayer), nevertheless, it
prescribes a tax based on sales, contrary to the statute (R.A. 2264). It is true that the
ordinance purports to base the tax on either "gross output or sales but the only standard
provided for measuring the gross output is its peso value, as determined from "true
copies of receipts and/or invoices (which are precisely the evidence of sales) that the
taxpayer is required to submit to the municipal treasurer (section 3), without deduction
being provided for freight insurance, or incidental costs. Directly or indirectly, the
amount of payable tax under this ordinance is determined by the gross sales of the
taxpayer, and violates the explicit prohibition that the municipality must not levy, or
impose, "taxes in any form based on sales." chanrobles virtual law library

The plea that the members of the Municipal Council "are not attorneys and of low
scholastic ability" afford no excuse for not observing well-established legal principles.
The tax imposing authority is held to know and understand that the levying of taxes is a
subject of grave responsibility, and of serious consequences to the taxpayer. Taxation is
not merely a matter of wishing before an unused well, or of stroking some wornout
lamp.chanroblesvirtualawlibrarychanrobles virtual law library

IN VIEW OF THE FOREGOING, the judgment appealed from is affirmed, with costs
against appellants.

Bengzon, C.J., Padilla, Bautista Angelo, Labrador, Concepcion, Paredes, Regala and
Makalintal, JJ., concur.
Barrera and Dizon, JJ., concur.

G.R. No. L-30264 March 12, 1929

MANILA RAILROAD COMPANY, plaintiff-appellee,

vs.
INSULAR COLLECTOR OF CUSTOMS, defendant-appellant.

Attorney-General Jaranilla for appellant.

Jose C. Abrew for appellee.

MALCOLM, J.:

The question involved in this appeal is the following: How should dust shields be
classified for the purposes of the tariff, under paragraph 141 or under paragraph 197 of
section 8 of the Tariff Law of 1909? These paragraphs placed in parallel columns for
purposes of comparison read:

141. Manufactures of wool not otherwise provided for, forty per centum ad
valorem

197. Vehicles for use on railways and tramways, and detached parts thereof, ten
per centum ad valorem.

Dust shields are manufactured of wool and hair mixed. The component material of chief
value is the wool. They are used by the Manila Railroad Company on all of its railway
wagons. The purpose of the dust shield is to cover the axle box in order to protect from
dust the oil deposited therein which serves to lubricate the bearings of the wheel. "Dust
guard," which is the same as "dust shield," is defined in the work Car Builders'
Cyclopedia of American Practice, 10th ed., 1922, p. 41, as follows: "A this piece of
wood, leather, felt, asbestos or other material inserted in the dust guard chamber at the
back of a journal box, and fitting closely around the dust guard bearing of the axle. Its
purpose is to exclude dust and to prevent the escape of oil and waste. Sometimes
called axle packing or box packing."

Based on these facts, it was the decision of the Insular Collector of Customs that dust
shields should be classified as "manufactures of wool, not otherwise provided for." That
decision is entitled to our respect. The burden is upon the importer to overcome the
presumption of a legal collection of duties by proof that their exaction was unlawful. The
question to be decided is not whether the Collector was wrong but whether the importer
was right. (Erhardt vs. Schroeder [1894], 155 U. S., 124; Behn, Meyer & Co. vs.
Collector of Customs [1913], 26 Phil., 647.) On the other hand, His Honor, Judge
Simplicio del Rosario, took an opposite view, overruled the decision of the Collector of
Customs, and held that dust shields should be classified as "detached parts" of vehicles
for the use on railways. This impartial finding is also entitled to our respect. It is the
general rule in the interpretation of statutes levying taxes or duties not to extend their
provisions beyond the clear import of the language used. In every case of doubt, such
statutes are construed most strongly against the Government and in favor of the citizen,
because burdens are not to be imposed, nor presumed to be imposed, beyond what the
statutes expressly and clearly import. (U. S. vs. Wigglesworth [1842], 2 Story, 369;
Froehlich & Kuttner vs. Collector of Customs [1911], 18 Phil., 461.)

There are present two fundamental considerations which guide the way out of the legal
dilemma. The first is by taking into account the purpose of the article and then
acknowledging that it is in reality used as a detached part or railways vehicles. The
second point is that paragraph 141 is a general provision while paragraph 197 is a
special provision. Where there is in the same statute a particular enactment and also a
general one which is embraced in the former, the particular enactment must be
operative, and the general enactment must be taken to effect only such cases within its
general language as are not within the provisions of the particular enactment (25 R. C.
L., p. 1010, citing numerous cases).

We conclude that the trial judge was correct in classifying dust shields under paragraph
197 of section 8 of the Tariff Law of 1909, and in refusing to classify them under
paragraph 141 of the same section of the law. Accordingly, the judgment appealed from
will be affirmed in its entirety, without special taxation of costs in either instance.

G.R. No. 115349 April 18, 1997

COMMISSIONER OF INTERNAL REVENUE, petitioner,

vs.
THE COURT OF APPEALS, THE COURT OF TAX APPEALS and ATENEO DE
MANILA UNIVERSITY, respondents.

PANGANIBAN, J.:

In conducting researches and studies of social organizations and cultural values thru its
Institute of Philippine Culture, is the Ateneo de Manila University performing the work of
an independent contractor and thus taxable within the purview of then Section 205 of
the National Internal Revenue Code levying a three percent contractor's tax? This
question is answer by the Court in the negative as it resolves this petition assailing the
Decision 1 of the Respondent Court of Appeals 2 in CA-G.R. SP No. 31790
promulgated on April 27, 1994 affirming that of the Court of Tax Appeals. 3

The Antecedent Facts

The antecedents as found by the Court of Appeals are reproduced hereinbelow, the
same being largely undisputed by the parties.

Private respondent is a non-stock, non-profit educational institution with

auxiliary units and branches all over the Philippines. One such auxiliary
unit is the Institute of Philippine Culture (IPC), which has no legal
personality separate and distinct from that of 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 July 8, 1983, private respondent received from petitioner

Commissioner of Internal Revenue a demand letter dated June 3, 1983,
assessing private respondent the sum of P174,043.97 for alleged
deficiency contractor's tax, and an assessment dated June 27, 1983 in the
sum of P1,141,837 for alleged deficiency income tax, both for the fiscal
year ended March 31, 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 March 17, 1988, 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 August 3, 1988 reducing the
assessment for deficiency contractor's tax from P193,475.55 to
P46,516.41, exclusive of surcharge and interest.
 On July 12, 1993, the respondent court rendered the questioned decision
which dispositively reads:

WHEREFORE, in view of the foregoing, respondent's

decision is SET ASIDE. The deficiency contractor's tax
assessment in the amount of P46,516.41 exclusive of
surcharge and interest for the fiscal year ended March 31,
1978 is hereby CANCELED. No pronouncement as to cost.

SO ORDERED.

Not in accord with said decision, petitioner has come to this Court via the present
petition for review raising the following issues:

1) WHETHER OR NOT PRIVATE RESPONDENT FALLS

UNDER THE PURVIEW OF INDEPENDENT
CONTRACTOR PURSUANT TO SECTION 205 OF THE
TAX CODE; and

2) WHETHER OR NOT PRIVATE RESPONDENT IS

SUBJECT TO 3% CONTRACTOR'S TAX UNDER SECTION
205 OF THE TAX CODE.

The pertinent portions of Section 205 of the National Internal Revenue Code, as
amended, provide:

Sec. 205. Contractor, proprietors or operators of dockyards, and others. —

A contractor's tax of three per centum of the gross receipts is hereby
imposed on the following:

xxx xxx xxx

(16) Business agents and other independent contractors

except persons, associations and corporations under
contract for embroidery and apparel for export, as well as
their agents and contractors and except gross receipts of or
from a pioneer industry registered with the Board of
Investments under Republic Act No. 5186:

xxx xxx xxx

The term "independent contractors" include persons

(juridical or natural) not enumerated above (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.
 xxx xxx xxx

Petitioner contends that the respondent court erred in holding that private
respondent is not an "independent contractor" within the purview of
Section 205 of the Tax Code. To petitioner, the term "independent
contractor", as defined by the Code, encompasses all kinds of services
rendered for a fee and that the only exceptions are the following:

a. Persons, association and corporations under contract for embroidery

and apparel for export and gross receipts of or from pioneer industry
registered with the Board of Investment under R.A. No. 5186;

b. Individuals occupation tax under Section 12 of the Local Tax Code

(under the old Section 182 [b] of the Tax Code); and

c. 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, communication and coordinating centers for their
affiliates, subsidiaries or branches in the Asia Pacific Region (Section 205
of the Tax Code).

Petitioner thus submits that since private respondent falls under the
definition of an "independent contractor" and is not among the
aforementioned exceptions, private respondent is therefore subject to the
3% contractor's tax imposed under the same Code. 4

The Court of Appeals disagreed with the Petitioner Commissioner of Internal Revenue
and affirmed the assailed decision of the Court of Tax Appeals. Unfazed, petitioner now
asks us to reverse the CA through this petition for review.

The Issues

Petitioner submits before us the following issues:

1) Whether or not private respondent falls under the purview of

independent contractor pursuant to Section 205 of the Tax Code.

2) Whether or not private respondent is subject to 3% contractor's tax

under Section 205 of the Tax Code. 5

In fine, these may be reduced to a single issue: Is Ateneo de Manila University, through
its auxiliary unit or branch — the Institute of Philippine Culture — performing the work of
an independent contractor and, thus, subject to the three percent contractor's tax levied
by then Section 205 of the National Internal Revenue Code?

The Court's Ruling

The petition is unmeritorious.

 Interpretation of Tax Laws

The parts of then Section 205 of the National Internal Revenue Code germane to the
case before us read:

Sec. 205. Contractors, proprietors or operators of dockyards, and others.

— A contractor's tax of three per centum of the gross receipts is hereby
imposed on the following:

xxx xxx xxx

(16) Business agents and other independent contractors, except persons,

associations and corporations under contract for embroidery and apparel
for export, as well as their agents and contractors, and except gross
receipts of or from a pioneer industry registered with the Board of
Investments under the provisions of Republic Act No. 5186;

xxx xxx xxx

The term "independent contractors" include persons (juridical or natural)

not enumerated above (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" shall 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.

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.

Petitioner Commissioner of Internal Revenue contends that Private Respondent Ateneo

de Manila University "falls within the definition" of an independent contractor and "is not
one of those mentioned as excepted"; hence, it is properly a subject of the three percent
contractor's tax levied by the foregoing provision of law. 6 Petitioner states that the
"term 'independent contractor' is not specifically defined so as to delimit the scope
thereof, so much so that any person who . . . renders physical and mental service for a
fee, is now indubitably considered an independent contractor liable to 3% contractor's
tax." 7 According to petitioner, Ateneo has the burden of proof to show its exemption
from the coverage of the law.
We disagree. Petitioner Commissioner of Internal Revenue 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. The Court takes this occasion to reiterate the hornbook doctrine in the
interpretation of tax laws 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." 8
Parenthetically, in answering the question of who is subject to tax statutes, it is basic
that "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." 9

To fall under its coverage, Section 205 of the National Internal Revenue Code requires
that the independent contractor be engaged in the business of selling its services.
Hence, to impose the three percent contractor's tax on Ateneo's Institute of Philippine
Culture, it should be sufficiently proven that the private respondent is indeed selling its
services for a fee in pursuit of an independent business. And it is only after private
respondent has been found clearly to be subject to the provisions of Sec. 205 that the
question of exemption therefrom would arise. Only after such coverage is shown does
the rule of construction — that tax exemptions are to be strictly construed against the
taxpayer — come into play, contrary to petitioner's position. This is the main line of
reasoning of the Court of Tax Appeals in its decision, 10 which was affirmed by the CA.

The Ateneo de Manila University Did Not Contract

for the Sale of the Service of its Institute of Philippine Culture

After reviewing the records of this case, we find no evidence that Ateneo's Institute of
Philippine Culture ever 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.

Stressing that "it is not the Ateneo de Manila University per se which is being taxed,"
Petitioner Commissioner of Internal Revenue contends that "the tax is due on its activity
of conducting researches for a fee. The tax is due on the gross receipts made in favor of
IPC pursuant to the contracts the latter entered to conduct researches for the benefit
primarily of its clients. The tax is imposed on the exercise of a taxable activity. . . . [T]he
sale of services of private respondent is made under a contract and the various
contracts entered into between private respondent and its clients are almost of the
same terms, showing, among others, the compensation and terms of payment." 11
(Emphasis supplied.)

In theory, the Commissioner of Internal Revenue may be correct. However, the records
do not show that Ateneo's IPC in fact contracted to sell its research services for a fee.
Clearly then, as found by the Court of Appeals and the Court of Tax Appeals,
petitioner's theory is inapplicable to the established factual milieu obtaining in the instant
case.

In the first place, the petitioner has presented no evidence to prove its bare contention
that, indeed, contracts for sale of services were ever entered into by the private
respondent. As appropriately pointed out by the latter:

An examination of the Commissioner's Written Formal Offer of Evidence in

the Court of Tax Appeals shows that only the following documentary
evidence was presented:

Exhibit 1 BIR letter of authority no. 331844

2 Examiner's Field Audit Report

3 Adjustments to Sales/Receipts

4 Letter-decision of BIR Commissioner

Bienvenido A. Tan Jr.

None of the foregoing evidence even comes close to purport to be

contracts between private respondent and third parties. 12

Moreover, the Court of Tax Appeals accurately and correctly declared that the " 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. 13

Respondent Court of Appeals elucidated on the ruling of the Court of Tax Appeals:

To our mind, private respondent hardly fits into the definition of an

"independent contractor".

For one, the established facts show that IPC, as a unit of the private
respondent, is not engaged in business. Undisputedly, private respondent
is mandated by law to undertake research activities to maintain its
university status. In fact, the research activities being carried out by the
IPC is focused not on business or profit but on social sciences studies of
Philippine society and culture. Since it can only finance a limited number
of IPC's research projects, private respondent occasionally accepts
sponsorship for unfunded IPC research projects from international
organizations, private foundations and governmental agencies. However,
such sponsorships are subject to private respondent's terms and
conditions, among which are, that the research is confined to topics
consistent with the private respondent's academic agenda; that no
proprietary or commercial purpose research is done; and that private
respondent retains not only the absolute right to publish but also the
ownership of the results of the research conducted by the IPC. Quite
 clearly, the aforementioned terms and conditions belie the allegation that
private respondent is a contractor or is engaged in business.

For another, it bears stressing that private respondent is a non-stock, non-

profit educational corporation. The fact that it accepted sponsorship for
IPC's unfunded projects is merely incidental. For, the main function of the
IPC is to undertake research projects under the academic agenda of the
private respondent. Moreover the records do not show that in accepting
sponsorship of research work, IPC realized profits from such work. On the
contrary, the evidence shows that for about 30 years, IPC had
continuously operated at a loss, which means that sponsored funds are
less than actual expenses for its research projects. That IPC has been
operating at a loss loudly bespeaks of the fact that education and not profit
is the motive for undertaking the research projects.

Then, too, granting arguendo that IPC made profits from the sponsored
research projects, the fact still remains that there is no proof that part of
such earnings or profits was ever distributed as dividends to any
stockholder, as in fact none was so distributed because they accrued to
the benefit of the private respondent which is a non-profit educational
institution. 14

Therefore, it is clear that the funds received by Ateneo's Institute of Philippine Culture
are not given in the concept of a fee or price in exchange for the performance of a
service or delivery of an object. Rather, the amounts are in the nature of an endowment
or donation given by IPC's benefactors solely for the purpose of sponsoring or funding
the research with no strings attached. As found by the two courts below, such
sponsorships are subject to IPC's terms and conditions. No proprietary or commercial
research is done, and IPC retains the ownership of the results of the research, including
the absolute right to publish the same. The copyrights over the results of the research
are owned by
Ateneo and, consequently, no portion thereof may be reproduced without its permission.
15 The amounts given to IPC, therefore, may not be deemed, it bears stressing as fees
or gross receipts that can be subjected to the three percent contractor's tax.

It is also well to stress that the questioned transactions of Ateneo's Institute of Philippine
Culture cannot be deemed either as a contract of sale or a contract of 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." 16 By its very nature, a contract of sale requires a
transfer of ownership. Thus, Article 1458 of the Civil Code "expressly makes the
obligation to transfer ownership as an essential element of the contract of sale, following
modern codes, such as the German and the Swiss. Even in the absence of this express
requirement, however, most writers, including Sanchez Roman, Gayoso, Valverde,
Ruggiero, Colin and Capitant, have considered such transfer of ownership as the
primary purpose of sale. Perez and Alguer follow the same view, stating that the
delivery of the thing does not mean a mere physical transfer, but is a means of
transmitting ownership. Transfer of title or an agreement to transfer it for a price paid or
promised to be paid is the essence of sale." 17 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, . . ." 18 Ineludably, whether the contract
be one of sale or one for a piece of work, a transfer of ownership is involved and a party
necessarily walks away with an object. 19 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.

Furthermore, it is clear that the research activity of the Institute of Philippine Culture is
done in pursuance of maintaining Ateneo's university status and not in the course of an
independent business of selling such research with profit in mind. This is clear from a
reading of the regulations governing universities:

31. In addition to the legal requisites an institution must meet, among

others, the following requirements before an application for university
status shall be considered:

xxx xxx xxx

(e) The institution must undertake research and operate with a competent
qualified staff at least three graduate departments in accordance with the
rules and standards for graduate education. One of the departments shall
be science and technology. The competence of the staff shall be judged
by their effective teaching, scholarly publications and research activities
published in its school journal as well as their leadership activities in the
profession.

(f) The institution must show evidence of adequate and stable financial
resources and support, a reasonable portion of which should be devoted
to institutional development and research. (emphasis supplied)

xxx xxx xxx

32. University status may be withdrawn, after due notice and hearing, for
failure to maintain satisfactorily the standards and requirements therefor.
20

Petitioner's contention that it is the Institute of Philippine Culture that is being taxed and
not the Ateneo is patently erroneous because the former is not an independent juridical
entity that is separate and distinct form the latter.

Factual Findings and Conclusions of the Court of Tax Appeals Affirmed by the
Court of Appeals Generally Conclusive

In addition, we reiterate that the "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" 21 Ateneo de Manila
University may be deemed a subject of the three percent contractor's tax "through the
evidence presented before it." Consequently, "as a matter of principle, this 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 . . ." 22 This point becomes more
evident in the case before us where the findings and conclusions of both the Court of
Tax Appeals and the Court of Appeals appear untainted by any abuse of authority,
much less grave abuse of discretion. Thus, we find the decision of the latter affirming
that of the former free from any palpable error.

Public Service, Not Profit, is the Motive

The records show that the Institute of Philippine Culture conducted its research
activities at a huge deficit of P1,624,014.00 as shown in its statements of fund and
disbursements for the period 1972 to 1985. 23 In fact, it was Ateneo de Manila
University itself that had funded the research projects of the institute, and it was only
when Ateneo could no longer produce the needed funds that the institute sought
funding from outside. The testimony of Ateneo's Director for Accounting Services, Ms.
Leonor Wijangco, provides significant insight on the academic and nonprofit nature of
the institute's research activities done in furtherance of the university's purposes, as
follows:

Q Now it was testified to earlier by Miss Thelma Padero (Office Manager

of the Institute of Philippine Culture) that as far as grants from sponsored
research it is possible that the grant sometimes is less than the actual
cost. Will you please tell us in this case when the actual cost is a lot less
than the grant who shoulders the additional cost?

A The University.

Q Now, why is this done by the University?

A Because of our faculty development program as a university, because a

university has to have its own research institute. 24

So, why is it that Ateneo continues to operate and conduct researches through its
Institute of Philippine Culture when it undisputedly loses not an insignificant amount in
the process? The plain and simple answer is that 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 [IPC's] motive for undertaking the research
projects." 25

WHEREFORE, premises considered, the petition is DENIED and the assailed Decision
of the Court of Appeals is hereby AFFIRMED in full.

-TAX EXEMPTION / AMNESTY

G.R. No. 108524 November 10, 1994

MISAMIS ORIENTAL ASSOCIATION OF COCO TRADERS, INC., petitioner,

vs.
DEPARTMENT OF FINANCE SECRETARY, COMMISSIONER OF THE BUREAU OF
INTERNAL REVENUE (BIR), AND REVENUE DISTRICT OFFICER, BIR MISAMIS
ORIENTAL, respondents.

Damasing Law Office for petitioner.

MENDOZA, J.:

This is a petition for prohibition and injunction seeking to nullify Revenue Memorandum
Circular No. 47-91 and enjoin the collection by respondent revenue officials of the Value
Added Tax (VAT) on the sale of copra by members of petitioner organization. 1

Petitioner Misamis Oriental Association of Coco Traders, Inc. is a domestic corporation

whose members, individually or collectively, are engaged in the buying and selling of
copra in Misamis Oriental. The petitioner alleges that prior to the issuance of Revenue
Memorandum Circular 47-91 on June 11, 1991, which implemented VAT Ruling 190-90,
copra was classified as agricultural food product under $ 103(b) of the National Internal
Revenue Code and, therefore, exempt from VAT at all stages of production or
distribution.

Respondents represent departments of the executive branch of government charged

with the generation of funds and the assessment, levy and collection of taxes and other
imposts.

The pertinent provision of the NIRC states:

Sec. 103. Exempt Transactions. — The following shall be exempt from the
value-added tax:

(a) Sale of nonfood agricultural, marine and forest products in their original
state by the primary producer or the owner of the land where the same are
produced;

(b) Sale or importation in their original state of agricultural and marine food
products, livestock and poultry of a kind generally used as, or yielding or
producing foods for human consumption, and breeding stock and genetic
material therefor;

Under §103(a), as above quoted, the sale of agricultural non-food products in their
original state is exempt from VAT only if the sale is made by the primary producer or
owner of the land from which the same are produced. The sale made by any other
person or entity, like a trader or dealer, is not exempt from the tax. On the other hand,
under §103(b) the sale of agricultural food products in their original state is exempt from
VAT at all stages of production or distribution regardless of who the seller is.
The question is whether copra is an agricultural food or non-food product for purposes
of this provision of the NIRC. On June 11, 1991, respondent Commissioner of Internal
Revenue issued the circular in question, classifying copra as an agricultural non-food
product and declaring it "exempt from VAT only if the sale is made by the primary
producer pursuant to Section 103(a) of the Tax Code, as amended." 2

The reclassification had the effect of denying to the petitioner the exemption it
previously enjoyed when copra was classified as an agricultural food product under
§103(b) of the NIRC. Petitioner challenges RMC No. 47-91 on various grounds, which
will be presently discussed although not in the order raised in the petition for prohibition.

First. Petitioner contends that the Bureau of Food and Drug of the Department of Health
and not the BIR is the competent government agency to determine the proper
classification of food products. Petitioner cites the opinion of Dr. Quintin Kintanar of the
Bureau of Food and Drug to the effect that copra should be considered "food" because
it is produced from coconut which is food and 80% of coconut products are edible.

On the other hand, the respondents argue that the opinion of the BIR, as the
government agency charged with the implementation and interpretation of the tax laws,
is entitled to great respect.

We agree with respondents. In interpreting §103(a) and (b) of the NIRC, the
Commissioner of Internal Revenue gave it a strict construction consistent with the rule
that tax exemptions must be strictly construed against the taxpayer and liberally in favor
of the state. Indeed, even Dr. Kintanar said that his classification of copra as food was
based on "the broader definition of food which includes agricultural commodities and
other components used in the manufacture/processing of food." The full text of his letter
reads:

10 April 1991

Mr. VICTOR A. DEOFERIO, JR.

Chairman VAT Review Committee
Bureau of Internal Revenue
Diliman, Quezon City

Dear Mr. Deoferio:

This is to clarify a previous communication made by this Office about

copra in a letter dated 05 December 1990 stating that copra is not
classified as food. The statement was made in the context of BFAD's
regulatory responsibilities which focus mainly on foods that are processed
and packaged, and thereby copra is not covered.

However, in the broader definition of food which include agricultural

commodities and other components used in the manufacture/ processing
of food, it is our opinion that copra should be classified as an agricultural
food product since copra is produced from coconut meat which is food and
based on available information, more than 80% of products derived from
copra are edible products.
 Very
truly
yours,

QUIN
TIN L.
KINTA
NAR,
M.D.,
Ph.D.
Direct
or
Assist
ant
Secret
ary of
Health
for
Stand
ards
and
Regul
ations

Moreover, as the government agency charged with the enforcement of the law, the
opinion of the Commissioner of Internal Revenue, in the absence of any showing that it
is plainly wrong, is entitled to great weight. Indeed, the ruling was made by the
Commissioner of Internal Revenue in the exercise of his power under § 245 of the NIRC
to "make rulings or opinions in connection with the implementation of the provisions of
internal revenue laws, including rulings on the classification of articles for sales tax and
similar purposes."

Second. Petitioner complains that it was denied due process because it was not heard
before the ruling was made. There is a distinction in administrative law between
legislative rules and interpretative rules. 3 There would be force in petitioner's argument
if the circular in question were in the nature of a legislative rule. But it is not. It is a mere
interpretative rule.

The reason for this distinction is that a legislative rule is in the nature of subordinate
legislation, designed to implement a primary legislation by providing the details thereof.
In the same way that laws must have the benefit of public hearing, it is generally
required that before a legislative rule is adopted there must be hearing. In this
connection, the Administrative Code of 1987 provides:

Public Participation. — If not otherwise required by law, an agency shall,

as far as practicable, publish or circulate notices of proposed rules and
afford interested parties the opportunity to submit their views prior to the
adoption of any rule.
 (2) In the fixing of rates, no rule or final order shall be valid unless the
proposed rates shall have been published in a newspaper of general
circulation at least two (2) weeks before the first hearing thereon.

(3) In case of opposition, the rules on contested cases shall be observed.

4

In addition such rule must be published.5 On the other hand, interpretative rules are
designed to provide guidelines to the law which the administrative agency is in charge
of enforcing.

Accordingly, in considering a legislative rule a court is free to make three inquiries: (i)
whether the rule is within the delegated authority of the administrative agency; (ii)
whether it is reasonable; and (iii) whether it was issued pursuant to proper procedure.
But the court is not free to substitute its judgment as to the desirability or wisdom of the
rule for the legislative body, by its delegation of administrative judgment, has committed
those questions to administrative judgments and not to judicial judgments. In the case of
an interpretative rule, the inquiry is not into the validity but into the correctness or
propriety of the rule. As a matter of power a court, when confronted with an
interpretative rule, is free to (i) give the force of law to the rule; (ii) go to the opposite
extreme and substitute its judgment; or (iii) give some intermediate degree of
authoritative weight to the interpretative rule. 6

In the case at bar, we find no reason for holding that respondent Commissioner erred in
not considering copra as an "agricultural food product" within the meaning of § 103(b) of
the NIRC. As the Solicitor General contends, "copra per se is not food, that is, it is not
intended for human consumption. Simply stated, nobody eats copra for food." That
previous Commissioners considered it so, is not reason for holding that the present
interpretation is wrong. The Commissioner of Internal Revenue is not bound by the
ruling of his predecessors. 7 To the contrary, the overruling of decisions is inherent in
the interpretation of laws.

Third. Petitioner likewise claims that RMC No. 47-91 is discriminatory and violative of
the equal protection clause of the Constitution because while coconut farmers and
copra producers are exempt, traders and dealers are not, although both sell copra in its
original state. Petitioners add that oil millers do not enjoy tax credit out of the VAT
payment of traders and dealers.

The argument has no merit. There is a material or substantial difference between

coconut farmers and copra producers, on the one hand, and copra traders and dealers,
on the other. The former produce and sell copra, the latter merely sell copra. The
Constitution does not forbid the differential treatment of persons so long as there is a
reasonable basis for classifying them differently. 8

It is not true that oil millers are exempt from VAT. Pursuant to § 102 of the NIRC, they
are subject to 10% VAT on the sale of services. Under § 104 of the Tax Code, they are
allowed to credit the input tax on the sale of copra by traders and dealers, but there is
no tax credit if the sale is made directly by the copra producer as the sale is VAT
exempt. In the same manner, copra traders and dealers are allowed to credit the input
tax on the sale of copra by other traders and dealers, but there is no tax credit if the sale
is made by the producer.

Fourth. It is finally argued that RMC No. 47-91 is counterproductive because traders
and dealers would be forced to buy copra from coconut farmers who are exempt from
the VAT and that to the extent that prices are reduced the government would lose
revenues as the 10% tax base is correspondingly diminished.

This is not so. The sale of agricultural non-food products is exempt from VAT only when
made by the primary producer or owner of the land from which the same is produced,
but in the case of agricultural food products their sale in their original state is exempt at
all stages of production or distribution. At any rate, the argument that the classification
of copra as agricultural non-food product is counterproductive is a question of wisdom
or policy which should be addressed to respondent officials and to Congress.

WHEREFORE, the petition is DISMISSED.

SO ORDERED.

G.R. No. 120082 September 11, 1996

MACTAN CEBU INTERNATIONAL AIRPORT AUTHORITY, petitioner,

vs.
HON. FERDINAND J. MARCOS, in his capacity as the Presiding Judge of the
Regional Trial Court, Branch 20, Cebu City, THE CITY OF CEBU, represented by
its Mayor HON. TOMAS R. OSMEÑA, and EUSTAQUIO B. CESA, respondents.

DAVIDE, JR., J.:

For review under Rule 45 of the Rules of Court on a pure question of law are the
decision of 22 March 19951 of the Regional Trial Court (RTC) of Cebu City,
Branch 20, dismissing the petition for declaratory relief in Civil Case No. CEB-
16900 entitled "Mactan Cebu International Airport Authority vs. City of Cebu",
and its order of 4, May 19952 denying the motion to reconsider the decision.

We resolved to give due course to this petition for its raises issues dwelling on
the scope of the taxing power of local government-owned and controlled
corporations.

The uncontradicted factual antecedents are summarized in the instant petition as

follows:
Petitioner Mactan Cebu International Airport Authority (MCIAA) was
created by virtue of Republic Act No. 6958, mandated to "principally
undertake the economical, efficient and effective control, management
and supervision of the Mactan International Airport in the Province of
Cebu and the Lahug Airport in Cebu City, . . . and such other Airports as
may be established in the Province of Cebu . . . (Sec. 3, RA 6958). It is
also mandated to:

a) encourage, promote and develop

international and domestic air traffic in the
Central Visayas and Mindanao regions as a
means of making the regions centers of
international trade and tourism, and
accelerating the development of the means of
transportation and communication in the
country; and

b) upgrade the services and facilities of the

airports and to formulate internationally
acceptable standards of airport
accommodation and service.

Since the time of its creation, petitioner MCIAA enjoyed the privilege of
exemption from payment of realty taxes in accordance with Section 14 of
its Charter.

Sec. 14. Tax Exemptions. — The authority shall be exempt

from realty taxes imposed by the National Government or
any of its political subdivisions, agencies and
instrumentalities . . .

On October 11, 1994, however, Mr. Eustaquio B. Cesa, Officer-in-Charge,

Office of the Treasurer of the City of Cebu, demanded payment for realty
taxes on several parcels of land belonging to the petitioner (Lot Nos. 913-
G, 743, 88 SWO, 948-A, 989-A, 474, 109(931), I-M, 918, 919, 913-F, 941,
942, 947, 77 Psd., 746 and 991-A), located at Barrio Apas and Barrio
Kasambagan, Lahug, Cebu City, in the total amount of P2,229,078.79.

Petitioner objected to such demand for payment as baseless and

unjustified, claiming in its favor the aforecited Section 14 of RA 6958
which exempt it from payment of realty taxes. It was also asserted that it is
an instrumentality of the government performing governmental functions,
citing section 133 of the Local Government Code of 1991 which puts
limitations on the taxing powers of local government units:

Sec. 133. Common Limitations on the Taxing Powers of

Local Government Units. — Unless otherwise provided
herein, the exercise of the taxing powers of provinces, cities,
municipalities, and barangay shall not extend to the levy of
the following:
 a) . . .

xxx xxx xxx

o) Taxes, fees or charges of any kind on the

National Government, its agencies and
instrumentalities, and local government units.
(Emphasis supplied)

Respondent City refused to cancel and set aside petitioner's realty tax
account, insisting that the MCIAA is a government-controlled corporation
whose tax exemption privilege has been withdrawn by virtue of Sections
193 and 234 of the Local Governmental Code that took effect on January
1, 1992:

Sec. 193. Withdrawal of Tax Exemption Privilege. — Unless otherwise

provided in this Code, tax exemptions or incentives granted to, or
presently enjoyed by all persons whether natural or juridical, including
government-owned or controlled corporations, except local water districts,
cooperatives duly registered under RA No. 6938, non-stock, and non-profit
hospitals and educational institutions, are hereby withdrawn upon the
effectivity of this Code. (Emphasis supplied)

xxx xxx xxx

Sec. 234. Exemptions from Real Property taxes. — . . .

(a) . . .

xxx xxx xxx

(c) . . .

Except as provided herein, any exemption from payment of

real property tax previously granted to, or presently enjoyed
by all persons, whether natural or juridical, including
government-owned or controlled corporations are hereby
withdrawn upon the effectivity of this Code.

As the City of Cebu was about to issue a warrant of levy against the
properties of petitioner, the latter was compelled to pay its tax account
"under protest" and thereafter filed a Petition for Declaratory Relief with
the Regional Trial Court of Cebu, Branch 20, on December 29, 1994.
MCIAA basically contended that the taxing powers of local government
units do not extend to the levy of taxes or fees of any kind on an
instrumentality of the national government. Petitioner insisted that while it
is indeed a government-owned corporation, it nonetheless stands on the
same footing as an agency or instrumentality of the national government.
Petitioner insisted that while it is indeed a government-owned corporation,
 it nonetheless stands on the same footing as an agency or instrumentality
of the national government by the very nature of its powers and functions.

Respondent City, however, asserted that MACIAA is not an instrumentality

of the government but merely a government-owned corporation
performing proprietary functions As such, all exemptions previously
granted to it were deemed withdrawn by operation of law, as provided
under Sections 193 and 234 of the Local Government Code when it took
effect on January 1, 1992.3

The petition for declaratory relief was docketed as Civil Case No. CEB-16900.

In its decision of 22 March 1995,4 the trial court dismissed the petition in light of
its findings, to wit:

A close reading of the New Local Government Code of 1991 or RA 7160

provides the express cancellation and withdrawal of exemption of taxes by
government owned and controlled corporation per Sections after the
effectivity of said Code on January 1, 1992, to wit: [proceeds to quote
Sections 193 and 234]

Petitioners claimed that its real properties assessed by respondent City

Government of Cebu are exempted from paying realty taxes in view of the
exemption granted under RA 6958 to pay the same (citing Section 14 of
RA 6958).

However, RA 7160 expressly provides that "All general and special laws,
acts, city charters, decress [sic], executive orders, proclamations and
administrative regulations, or part or parts thereof which are inconsistent
with any of the provisions of this Code are hereby repealed or modified
accordingly." ([f], Section 534, RA 7160).

With that repealing clause in RA 7160, it is safe to infer and state that the
tax exemption provided for in RA 6958 creating petitioner had been
expressly repealed by the provisions of the New Local Government Code
of 1991.

So that petitioner in this case has to pay the assessed realty tax of its
properties effective after January 1, 1992 until the present.

This Court's ruling finds expression to give impetus and meaning to the
overall objectives of the New Local Government Code of 1991, RA 7160.
"It is hereby declared the policy of the State that the territorial and political
subdivisions of the State shall enjoy genuine and meaningful local
autonomy to enable them to attain their fullest development as self-reliant
communities and make them more effective partners in the attainment of
national goals. Towards this end, the State shall provide for a more
responsive and accountable local government structure instituted through
a system of decentralization whereby local government units shall be
given more powers, authority, responsibilities, and resources. The process
 of decentralization shall proceed from the national government to the local
government units. . . .5

Its motion for reconsideration having been denied by the trial court in its 4 May
1995 order, the petitioner filed the instant petition based on the following
assignment of errors:

I RESPONDENT JUDGE ERRED IN FAILING TO RULE

THAT THE PETITIONER IS VESTED WITH GOVERNMENT
POWERS AND FUNCTIONS WHICH PLACE IT IN THE
SAME CATEGORY AS AN INSTRUMENTALITY OR
AGENCY OF THE GOVERNMENT.

II RESPONDENT JUDGE ERRED IN RULING THAT

PETITIONER IS LIABLE TO PAY REAL PROPERTY
TAXES TO THE CITY OF CEBU.

Anent the first assigned error, the petitioner asserts that although it is a
government-owned or controlled corporation it is mandated to perform functions
in the same category as an instrumentality of Government. An instrumentality of
Government is one created to perform governmental functions primarily to
promote certain aspects of the economic life of the people.6 Considering its task
"not merely to efficiently operate and manage the Mactan-Cebu International
Airport, but more importantly, to carry out the Government policies of promoting
and developing the Central Visayas and Mindanao regions as centers of
international trade and tourism, and accelerating the development of the means
of transportation and communication in the country,"7 and that it is an attached
agency of the Department of Transportation and Communication (DOTC),8 the
petitioner "may stand in [sic] the same footing as an agency or instrumentality of
the national government." Hence, its tax exemption privilege under Section 14 of
its Charter "cannot be considered withdrawn with the passage of the Local
Government Code of 1991 (hereinafter LGC) because Section 133 thereof
specifically states that the taxing powers of local government units shall not
extend to the levy of taxes of fees or charges of any kind on the national
government its agencies and instrumentalities."

As to the second assigned error, the petitioner contends that being an

instrumentality of the National Government, respondent City of Cebu has no
power nor authority to impose realty taxes upon it in accordance with the
aforesaid Section 133 of the LGC, as explained in Basco vs. Philippine
Amusement and Gaming Corporation;9

Local governments have no power to tax instrumentalities of the National

Government. PAGCOR is a government owned or controlled corporation
with an original character, PD 1869. All its shares of stock are owned by
the National Government. . . .

PAGCOR has a dual role, to operate and regulate gambling casinos. The
latter joke is governmental, which places it in the category of an agency or
instrumentality of the Government. Being an instrumentality of the
 Government, PAGCOR should be and actually is exempt from local taxes.
Otherwise, its operation might be burdened, impeded or subjected to
control by a mere Local government.

The states have no power by taxation or otherwise, to retard, impede,

burden or in any manner control the operation of constitutional laws
enacted by Congress to carry into execution the powers vested in the
federal government. (McCulloch v. Maryland, 4 Wheat 316, 4 L Ed. 579).

This doctrine emanates from the "supremacy" of the National Government

over local government.

Justice Holmes, speaking for the Supreme Court, make references to the
entire absence of power on the part of the States to touch, in that way
(taxation) at least, the instrumentalities of the United States (Johnson v.
Maryland, 254 US 51) and it can be agreed that no state or political
subdivision can regulate a federal instrumentality in such a way as to
prevent it from consummating its federal responsibilities, or even to
seriously burden it in the accomplishment of them. (Antieau Modern
Constitutional Law, Vol. 2, p. 140)

Otherwise mere creature of the State can defeat National policies thru
extermination of what local authorities may perceive to be undesirable
activities or enterprise using the power to tax as "a toll for regulation" (U.S.
v. Sanchez, 340 US 42). The power to tax which was called by Justice
Marshall as the "power to destroy" (McCulloch v. Maryland, supra) cannot
be allowed to defeat an instrumentality or creation of the very entity which
has the inherent power to wield it. (Emphasis supplied)

It then concludes that the respondent Judge "cannot therefore correctly say that
the questioned provisions of the Code do not contain any distinction between a
governmental function as against one performing merely proprietary ones such
that the exemption privilege withdrawn under the said Code would apply to all
government corporations." For it is clear from Section 133, in relation to Section
234, of the LGC that the legislature meant to exclude instrumentalities of the
national government from the taxing power of the local government units.

In its comment respondent City of Cebu alleges that as local a government unit
and a political subdivision, it has the power to impose, levy, assess, and collect
taxes within its jurisdiction. Such power is guaranteed by the Constitution10 and
enhanced further by the LGC. While it may be true that under its Charter the
petitioner was exempt from the payment of realty taxes,11 this exemption was
withdrawn by Section 234 of the LGC. In response to the petitioner's claim that
such exemption was not repealed because being an instrumentality of the
National Government, Section 133 of the LGC prohibits local government units
from imposing taxes, fees, or charges of any kind on it, respondent City of Cebu
points out that the petitioner is likewise a government-owned corporation, and
Section 234 thereof does not distinguish between government-owned
corporation, and Section 234 thereof does not distinguish between government-
owned corporation, and Section 234 thereof does not distinguish between
government-owned or controlled corporations performing governmental and
purely proprietary functions. Respondent city of Cebu urges this the Manila
International Airport Authority is a governmental-owned corporation, 12 and to
reject the application of Basco because it was "promulgated . . . before the
enactment and the singing into law of R.A. No. 7160," and was not, therefore,
decided "in the light of the spirit and intention of the framers of the said law.

As a general rule, the power to tax is an incident of sovereignty and is unlimited

in its range, acknowledging in its very nature no limits, so that security against its
abuse is to be found only in the responsibility of the legislature which imposes
the tax on the constituency who are to pay it. Nevertheless, effective limitations
thereon may be imposed by the people through their Constitutions.13 Our
Constitution, for instance, provides that the rule of taxation shall be uniform and
equitable and Congress shall evolve a progressive system of taxation.14 So
potent indeed is the power that it was once opined that "the power to tax involves
the power to destroy."15 Verily, taxation is a destructive power which interferes
with the personal and property for the support of the government. Accordingly,
tax statutes must be construed strictly against the government and liberally in
favor of the taxpayer.16 But since taxes are what we pay for civilized society,17
or are the lifeblood of the nation, the law frowns against exemptions from taxation
and statutes granting tax exemptions are thus construed strictissimi juris against
the taxpayers and liberally in favor of the taxing authority.18 A claim of exemption
from tax payment must be clearly shown and based on language in the law too
plain to be mistaken.19 Elsewise stated, taxation is the rule, exemption therefrom
is the exception.20 However, if the grantee of the exemption is a political
subdivision or instrumentality, the rigid rule of construction does not apply
because the practical effect of the exemption is merely to reduce the amount of
money that has to be handled by the government in the course of its
operations.21

The power to tax is primarily vested in the Congress; however, in our jurisdiction,
it may be exercised by local legislative bodies, no longer merely by virtue of a
valid delegation as before, but pursuant to direct authority conferred by Section
5, Article X of the Constitution.22 Under the latter, the exercise of the power may
be subject to such guidelines and limitations as the Congress may provide which,
however, must be consistent with the basic policy of local autonomy.

There can be no question that under Section 14 of R.A. No. 6958 the petitioner is
exempt from the payment of realty taxes imposed by the National Government or
any of its political subdivisions, agencies, and instrumentalities. Nevertheless,
since taxation is the rule and exemption therefrom the exception, the exemption
may thus be withdrawn at the pleasure of the taxing authority. The only exception
to this rule is where the exemption was granted to private parties based on
material consideration of a mutual nature, which then becomes contractual and is
thus covered by the non-impairment clause of the Constitution.23

The LGC, enacted pursuant to Section 3, Article X of the constitution provides for
the exercise by local government units of their power to tax, the scope thereof or
its limitations, and the exemption from taxation.
Section 133 of the LGC prescribes the common limitations on the taxing powers
of local government units as follows:

Sec. 133. Common Limitations on the Taxing Power of Local Government

Units. — Unless otherwise provided herein, the exercise of the taxing
powers of provinces, cities, municipalities, and barangays shall not extend
to the levy of the following:

(a) Income tax, except when levied on banks and other

financial institutions;

(b) Documentary stamp tax;

(c) Taxes on estates, "inheritance, gifts, legacies and other

acquisitions mortis causa, except as otherwise provided
herein

(d) Customs duties, registration fees of vessels and

wharfage on wharves, tonnage dues, and all other kinds of
customs fees charges and dues except wharfage on
wharves constructed and maintained by the local
government unit concerned:

(e) Taxes, fees and charges and other imposition upon

goods carried into or out of, or passing through, the territorial
jurisdictions of local government units in the guise or
charges for wharfages, tolls for bridges or otherwise, or other
taxes, fees or charges in any form whatsoever upon such
goods or merchandise;

(f) Taxes fees or charges on agricultural and aquatic

products when sold by marginal farmers or fishermen;

(g) Taxes on business enterprise certified to be the Board of

Investment as pioneer or non-pioneer for a period of six (6)
and four (4) years, respectively from the date of registration;

(h) Excise taxes on articles enumerated under the National

Internal Revenue Code, as amended, and taxes, fees or
charges on petroleum products;

(i) Percentage or value added tax (VAT) on sales, barters or

exchanges or similar transactions on goods or services
except as otherwise provided herein;

(j) Taxes on the gross receipts of transportation contractor

and person engage in the transportation of passengers of
freight by hire and common carriers by air, land, or water,
except as provided in this code;
 (k) Taxes on premiums paid by ways reinsurance or
retrocession;

(l) Taxes, fees, or charges for the registration of motor

vehicles and for the issuance of all kinds of licenses or
permits for the driving of thereof, except, tricycles;

(m) Taxes, fees, or other charges on Philippine product

actually exported, except as otherwise provided herein;

(n) Taxes, fees, or charges, on Countryside and Barangay

Business Enterprise and Cooperatives duly registered under
R.A. No. 6810 and Republic Act Numbered Sixty nine
hundred thirty-eight (R.A. No. 6938) otherwise known as the
"Cooperative Code of the Philippines; and

(o) TAXES, FEES, OR CHARGES OF ANY KIND ON THE

NATIONAL GOVERNMENT, ITS AGENCIES AND
INSTRUMENTALITIES, AND LOCAL GOVERNMENT
UNITS. (emphasis supplied)

Needless to say the last item (item o) is pertinent in this case. The "taxes, fees or
charges" referred to are "of any kind", hence they include all of these, unless
otherwise provided by the LGC. The term "taxes" is well understood so as to
need no further elaboration, especially in the light of the above enumeration. The
term "fees" means charges fixed by law or Ordinance for the regulation or
inspection of business activity,24 while "charges" are pecuniary liabilities such as
rents or fees against person or property.25

Among the "taxes" enumerated in the LGC is real property tax, which is governed
by Section 232. It reads as follows:

Sec. 232. Power to Levy Real Property Tax. — A province or city or a

municipality within the Metropolitan Manila Area may levy on an annual ad
valorem tax on real property such as land, building, machinery and other
improvements not hereafter specifically exempted.

Section 234 of LGC provides for the exemptions from payment of real property
taxes and withdraws previous exemptions therefrom granted to natural and
juridical persons, including government owned and controlled corporations,
except as provided therein. It provides:

Sec. 234. Exemptions from Real Property Tax. — The following are
exempted from payment of the real property tax:

(a) Real property owned by the Republic of the Philippines or

any of its political subdivisions except when the beneficial
use thereof had been granted, for reconsideration or
otherwise, to a taxable person;
 (b) Charitable institutions, churches, parsonages or convents
appurtenants thereto, mosques nonprofits or religious
cemeteries and all lands, building and improvements
actually, directly, and exclusively used for religious charitable
or educational purposes;

(c) All machineries and equipment that are actually, directly

and exclusively used by local water districts and
government-owned or controlled corporations engaged in
the supply and distribution of water and/or generation and
transmission of electric power;

(d) All real property owned by duly registered cooperatives

as provided for under R.A. No. 6938; and;

(e) Machinery and equipment used for pollution control and

environmental protection.

Except as provided herein, any exemptions from payment of

real property tax previously granted to or presently enjoyed
by, all persons whether natural or juridical, including all
government owned or controlled corporations are hereby
withdrawn upon the effectivity of his Code.

These exemptions are based on the ownership, character, and use of the
property. Thus;

(a) Ownership Exemptions. Exemptions from real property

taxes on the basis of ownership are real properties owned
by: (i) the Republic, (ii) a province, (iii) a city, (iv) a
municipality, (v) a barangay, and (vi) registered
cooperatives.

(b) Character Exemptions. Exempted from real property

taxes on the basis of their character are: (i) charitable
institutions, (ii) houses and temples of prayer like churches,
parsonages or convents appurtenant thereto, mosques, and
(iii) non profit or religious cemeteries.

(c) Usage exemptions. Exempted from real property taxes

on the basis of the actual, direct and exclusive use to which
they are devoted are: (i) all lands buildings and
improvements which are actually, directed and exclusively
used for religious, charitable or educational purpose; (ii) all
machineries and equipment actually, directly and exclusively
used or by local water districts or by government-owned or
controlled corporations engaged in the supply and
distribution of water and/or generation and transmission of
electric power; and (iii) all machinery and equipment used for
pollution control and environmental protection.
 To help provide a healthy environment in the midst of the modernization of
the country, all machinery and equipment for pollution control and
environmental protection may not be taxed by local governments.

2. Other Exemptions Withdrawn. All other exemptions

previously granted to natural or juridical persons including
government-owned or controlled corporations are withdrawn
upon the effectivity of the Code.26

Section 193 of the LGC is the general provision on withdrawal of tax exemption
privileges. It provides:

Sec. 193. Withdrawal of Tax Exemption Privileges. — Unless otherwise

provided in this code, tax exemptions or incentives granted to or presently
enjoyed by all persons, whether natural or juridical, including government-
owned, or controlled corporations, except local water districts,
cooperatives duly registered under R.A. 6938, non stock and non profit
hospitals and educational constitutions, are hereby withdrawn upon the
effectivity of this Code.

On the other hand, the LGC authorizes local government units to grant tax
exemption privileges. Thus, Section 192 thereof provides:

Sec. 192. Authority to Grant Tax Exemption Privileges. — Local

government units may, through ordinances duly approved, grant tax
exemptions, incentives or reliefs under such terms and conditions as they
may deem necessary.

The foregoing sections of the LGC speaks of: (a) the limitations on the taxing
powers of local government units and the exceptions to such limitations; and (b)
the rule on tax exemptions and the exceptions thereto. The use of exceptions of
provisos in these section, as shown by the following clauses:

(1) "unless otherwise provided herein" in the opening

paragraph of Section 133;

(2) "Unless otherwise provided in this Code" in section 193;

(3) "not hereafter specifically exempted" in Section 232; and

(4) "Except as provided herein" in the last paragraph of

Section 234

initially hampers a ready understanding of the sections. Note, too, that the
aforementioned clause in section 133 seems to be inaccurately worded. Instead
of the clause "unless otherwise provided herein," with the "herein" to mean, of
course, the section, it should have used the clause "unless otherwise provided in
this Code." The former results in absurdity since the section itself enumerates
what are beyond the taxing powers of local government units and, where
exceptions were intended, the exceptions were explicitly indicated in the text. For
instance, in item (a) which excepts the income taxes "when livied on banks and
other financial institutions", item (d) which excepts "wharfage on wharves
constructed and maintained by the local government until concerned"; and item
(1) which excepts taxes, fees, and charges for the registration and issuance of
license or permits for the driving of "tricycles". It may also be observed that within
the body itself of the section, there are exceptions which can be found only in
other parts of the LGC, but the section interchangeably uses therein the clause
"except as otherwise provided herein" as in items (c) and (i), or the clause
"except as otherwise provided herein" as in items (c) and (i), or the clause
"excepts as provided in this Code" in item (j). These clauses would be obviously
unnecessary or mere surplus-ages if the opening clause of the section were"
"Unless otherwise provided in this Code" instead of "Unless otherwise provided
herein". In any event, even if the latter is used, since under Section 232 local
government units have the power to levy real property tax, except those
exempted therefrom under Section 234, then Section 232 must be deemed to
qualify Section 133.

Thus, reading together Section 133, 232 and 234 of the LGC, we conclude that
as a general rule, as laid down in Section 133 the taxing powers of local
government units cannot extend to the levy of inter alia, "taxes, fees, and
charges of any kind of the National Government, its agencies and
instrumentalties, and local government units"; however, pursuant to Section 232,
provinces, cities, municipalities in the Metropolitan Manila Area may impose the
real property tax except on, inter alia, "real property owned by the Republic of the
Philippines or any of its political subdivisions except when the beneficial used
thereof has been granted, for consideration or otherwise, to a taxable person", as
provided in item (a) of the first paragraph of Section 234.

As to tax exemptions or incentives granted to or presently enjoyed by natural or

juridical persons, including government-owned and controlled corporations,
Section 193 of the LGC prescribes the general rule, viz., they are withdrawn
upon the effectivity of the LGC, except upon the effectivity of the LGC, except
those granted to local water districts, cooperatives duly registered under R.A. No.
6938, non stock and non-profit hospitals and educational institutions, and unless
otherwise provided in the LGC. The latter proviso could refer to Section 234,
which enumerates the properties exempt from real property tax. But the last
paragraph of Section 234 further qualifies the retention of the exemption in so far
as the real property taxes are concerned by limiting the retention only to those
enumerated there-in; all others not included in the enumeration lost the privilege
upon the effectivity of the LGC. Moreover, even as the real property is owned by
the Republic of the Philippines, or any of its political subdivisions covered by item
(a) of the first paragraph of Section 234, the exemption is withdrawn if the
beneficial use of such property has been granted to taxable person for
consideration or otherwise.

Since the last paragraph of Section 234 unequivocally withdrew, upon the
effectivity of the LGC, exemptions from real property taxes granted to natural or
juridical persons, including government-owned or controlled corporations, except
as provided in the said section, and the petitioner is, undoubtedly, a government-
owned corporation, it necessarily follows that its exemption from such tax granted
it in Section 14 of its charter, R.A. No. 6958, has been withdrawn. Any claim to
the contrary can only be justified if the petitioner can seek refuge under any of
the exceptions provided in Section 234, but not under Section 133, as it now
asserts, since, as shown above, the said section is qualified by Section 232 and
234.

In short, the petitioner can no longer invoke the general rule in Section 133 that
the taxing powers of the local government units cannot extend to the levy of:

(o) taxes, fees, or charges of any kind on the National

Government, its agencies, or instrumentalities, and local
government units.

I must show that the parcels of land in question, which are real property, are any
one of those enumerated in Section 234, either by virtue of ownership, character,
or use of the property. Most likely, it could only be the first, but not under any
explicit provision of the said section, for one exists. In light of the petitioner's
theory that it is an "instrumentality of the Government", it could only be within be
first item of the first paragraph of the section by expanding the scope of the terms
Republic of the Philippines" to embrace . . . . . . "instrumentalities" and "agencies"
or expediency we quote:

(a) real property owned by the Republic of the Philippines, or

any of the Philippines, or any of its political subdivisions
except when the beneficial use thereof has been granted, for
consideration or otherwise, to a taxable person.

This view does not persuade us. In the first place, the petitioner's claim that it is
an instrumentality of the Government is based on Section 133(o), which
expressly mentions the word "instrumentalities"; and in the second place it fails to
consider the fact that the legislature used the phrase "National Government, its
agencies and instrumentalities" "in Section 133(o),but only the phrase "Republic
of the Philippines or any of its political subdivision "in Section 234(a).

The terms "Republic of the Philippines" and "National Government" are not
interchangeable. The former is boarder and synonymous with "Government of
the Republic of the Philippines" which the Administrative Code of the 1987
defines as the "corporate governmental entity though which the functions of the
government are exercised through at the Philippines, including, saves as the
contrary appears from the context, the various arms through which political
authority is made effective in the Philippines, whether pertaining to the
autonomous reason, the provincial, city, municipal or barangay subdivision or
other forms of local government."27 These autonomous regions, provincial, city,
municipal or barangay subdivisions" are the political subdivision.28

On the other hand, "National Government" refers "to the entire machinery of the
central government, as distinguished from the different forms of local
Governments."29 The National Government then is composed of the three great
departments the executive, the legislative and the judicial.30
An "agency" of the Government refers to "any of the various units of the
Government, including a department, bureau, office instrumentality, or
government-owned or controlled corporation, or a local government or a distinct
unit therein;"31 while an "instrumentality" refers to "any agency of the National
Government, not integrated within the department framework, vested with special
functions or jurisdiction by law, endowed with some if not all corporate powers,
administering special funds, and enjoying operational autonomy; usually through
a charter. This term includes regulatory agencies, chartered institutions and
government-owned and controlled corporations".32

If Section 234(a) intended to extend the exception therein to the withdrawal of the
exemption from payment of real property taxes under the last sentence of the
said section to the agencies and instrumentalities of the National Government
mentioned in Section 133(o), then it should have restated the wording of the
latter. Yet, it did not Moreover, that Congress did not wish to expand the scope of
the exemption in Section 234(a) to include real property owned by other
instrumentalities or agencies of the government including government-owned
and controlled corporations is further borne out by the fact that the source of this
exemption is Section 40(a) of P.D. No. 646, otherwise known as the Real
Property Tax Code, which reads:

Sec 40. Exemption from Real Property Tax. — The exemption shall be as
follows:

(a) Real property owned by the Republic of the

Philippines or any of its political subdivisions
and any government-owned or controlled
corporations so exempt by is charter: Provided,
however, that this exemption shall not apply to
real property of the above mentioned entities
the beneficial use of which has been granted,
for consideration or otherwise, to a taxable
person.

Note that as a reproduced in Section 234(a), the phrase "and any government-
owned or controlled corporation so exempt by its charter" was excluded. The
justification for this restricted exemption in Section 234(a) seems obvious: to limit
further tax exemption privileges, specially in light of the general provision on
withdrawal of exemption from payment of real property taxes in the last
paragraph of property taxes in the last paragraph of Section 234. These policy
considerations are consistent with the State policy to ensure autonomy to local
governments33 and the objective of the LGC that they enjoy genuine and
meaningful local autonomy to enable them to attain their fullest development as
self-reliant communities and make them effective partners in the attainment of
national goals.34 The power to tax is the most effective instrument to raise
needed revenues to finance and support myriad activities of local government
units for the delivery of basic services essential to the promotion of the general
welfare and the enhancement of peace, progress, and prosperity of the people. It
may also be relevant to recall that the original reasons for the withdrawal of tax
exemption privileges granted to government-owned and controlled corporations
and all other units of government were that such privilege resulted in serious tax
base erosion and distortions in the tax treatment of similarly situated enterprises,
and there was a need for this entities to share in the requirements of the
development, fiscal or otherwise, by paying the taxes and other charges due
from them.35

The crucial issues then to be addressed are: (a) whether the parcels of land in
question belong to the Republic of the Philippines whose beneficial use has been
granted to the petitioner, and (b) whether the petitioner is a "taxable person".

Section 15 of the petitioner's Charter provides:

Sec. 15. Transfer of Existing Facilities and Intangible Assets. — All

existing public airport facilities, runways, lands, buildings and other
properties, movable or immovable, belonging to or presently administered
by the airports, and all assets, powers, rights, interests and privileges
relating on airport works, or air operations, including all equipment which
are necessary for the operations of air navigation, acrodrome control
towers, crash, fire, and rescue facilities are hereby transferred to the
Authority: Provided however, that the operations control of all equipment
necessary for the operation of radio aids to air navigation, airways
communication, the approach control office, and the area control center
shall be retained by the Air Transportation Office. No equipment, however,
shall be removed by the Air Transportation Office from Mactan without the
concurrence of the authority. The authority may assist in the maintenance
of the Air Transportation Office equipment.

The "airports" referred to are the "Lahug Air Port" in Cebu City and the "Mactan
International AirPort in the Province of Cebu",36 which belonged to the Republic
of the Philippines, then under the Air Transportation Office (ATO).37

It may be reasonable to assume that the term "lands" refer to "lands" in Cebu
City then administered by the Lahug Air Port and includes the parcels of land the
respondent City of Cebu seeks to levy on for real property taxes. This section
involves a "transfer" of the "lands" among other things, to the petitioner and not
just the transfer of the beneficial use thereof, with the ownership being retained
by the Republic of the Philippines.

This "transfer" is actually an absolute conveyance of the ownership thereof

because the petitioner's authorized capital stock consists of, inter alia "the value
of such real estate owned and/or administered by the airports."38 Hence, the
petitioner is now the owner of the land in question and the exception in Section
234(c) of the LGC is inapplicable.

Moreover, the petitioner cannot claim that it was never a "taxable person" under
its Charter. It was only exempted from the payment of real property taxes. The
grant of the privilege only in respect of this tax is conclusive proof of the
legislative intent to make it a taxable person subject to all taxes, except real
property tax.
 Finally, even if the petitioner was originally not a taxable person for purposes of
real property tax, in light of the forgoing disquisitions, it had already become even
if it be conceded to be an "agency" or "instrumentality" of the Government, a
taxable person for such purpose in view of the withdrawal in the last paragraph of
Section 234 of exemptions from the payment of real property taxes, which, as
earlier adverted to, applies to the petitioner.

Accordingly, the position taken by the petitioner is untenable. Reliance on Basco

vs. Philippine Amusement and Gaming Corporation39 is unavailing since it was
decided before the effectivity of the LGC. Besides, nothing can prevent Congress
from decreeing that even instrumentalities or agencies of the government
performing governmental functions may be subject to tax. Where it is done
precisely to fulfill a constitutional mandate and national policy, no one can doubt
its wisdom.

WHEREFORE, the instant petition is DENIED. The challenged decision and

order of the Regional Trial Court of Cebu, Branch 20, in Civil Case No. CEB-
16900 are AFFIRMED.

No pronouncement as to costs.

SO ORDERED.

Narvasa, C.J., Melo, Francisco and Panganiban, JJ., concur.

4. SOCIAL LEGISLATION

G.R. Nos. 92981-83 January 9, 1992

INTERNATIONAL PHARMACEUTICALS, INC., petitioner,

vs.
HON. SECRETARY OF LABOR and ASSOCIATED LABOR UNION (ALU),
respondents.

E.B. Ramos & Associates for petitioner.

Celso C. Reales for private respondent.

REGALADO, J.:

The issue before us is whether or not the Secretary of the Department of Labor and
Employment has the power to assume jurisdiction over a labor dispute and its incidental
controversies, including unfair labor practice cases, causing or likely to cause a strike or
lockout in an industry indispensable to the national interest.

The operative facts which culminated in the present recourse are undisputed.

Prior to the expiration on January 1, 1989 of the collective bargaining agreement

between petitioner International Pharmaceuticals, Inc. (hereafter, Company) and the
Associated Labor Union (Union, for brevity), the latter submitted to the Company its
economic and political demands. These were not met by the Company, hence a
deadlock ensued.

On June 27, 1989, the Union filed a notice of strike with Regional Office No. VII of the
National Conciliation and Mediation Board, Department of Labor and Employment,
which was docketed as NCMB-RBVII-NS-06-050-89. After all conciliation efforts had
failed, the Union went on strike on August 8, 1989 and the Company's operations were
completely paralyzed.

Subsequently, three other labor cases involving the same parties were filed with the
National Labor Relations Commission (NLRC) to wit:

1. International Pharmaceuticals, Inc. vs. Associated Labor Union, NLRC

Case No. VII-09-0810-89, 1 a petition for injunction and damages with
temporary restraining order filed by the Company against the Union and
some of its members for picketing the Company's establishment in Cebu,
Davao, and Metro Manila allegedly without the required majority of the
employees approving and agreeing to the strike and with simulated strike
votes, in direct violation of the provisions of their collective bargaining
agreement and in total and complete defiance of the provisions of the
Labor Code;

2. Associated Labor Union vs. International Pharmaceuticals, Inc., et al.,

NLRC Case No-VII-08-0715-89, 2 a complaint for unfair labor practice with
prayer for damages and attorney's fees filed by the Union against the
Company, its personnel manager, and the Workers Alliance of Trade
Unions (WATU) as a result of the Company's refusal to include the sales
workers in the bargaining unit resulting in a deadlock in the bargaining
negotiations; for coddling the respondent WATU as a separate bargaining
agent of the sales workers despite a contrary ruling of the Med-Arbiter;
and undue interference by the Company in the right of the workers to self-
organization through harassment and dispersal of a peaceful picket during
the strike; and

3. International Pharmaceuticals, Inc., et al. vs. Associated Labor Union,

NLRC Case No. VII-08-0742-89, 3 a petition to declare the strike illegal
with prayer for damages filed by the Company alleging, among others,
that the notice of strike filed by the Union with the National Conciliation
and Mediation Board did not conform with the requirements of the Labor
Code, and that the Union, in violation of the Labor Code provisions on the
conduct of the strike, totally blockaded and continued to blockade the
ingress and egress of the Company's premises by human barricades,
 placards, benches and other obstructions, completely paralyzing its
business operations.

Meanwhile, considering that the Company belongs to an industry indispensable to

national interest, it being engaged in the manufacture of drugs and pharmaceuticals and
employing around 600 workers, then Acting Secretary of Labor, Ricardo C. Castro,
invoking Article 263 (g) of the Labor Code, issued an order dated September 26, 1989
assuming jurisdiction over the aforesaid case docketed as NCMB-RBVII-NS-06-050-89
and directing the parties to return to the status quo before the work stoppage. The
decretal portion of the order reads:

WHEREFORE, PREMISES CONSIDERED, this Office hereby assumes

jurisdiction over the labor dispute at the International Pharmaceuticals,
Incorporated pursuant to Article 263 (g) of the Labor Code, as amended.

Accordingly, all striking workers are hereby directed to return to work and
management to accept them under the same terms and conditions
prevailing before the work stoppage, within twenty four (24) hours from
receipt of this Order. Management is directed to post copies of this Order
in three (3) conspicuous places in the company premises.

The parties are likewise ordered to cease and desist from committing any
and all acts that will prejudice either party and aggravate the situation as
well as the normalization of operations.

SO ORDERED. 4

On January 15, 1990, the Union filed a motion in NCMB-RBVII-NS-06-050-85, the case
over which jurisdiction had been assumed by the Secretary of Labor and Employment
(hereafter referred to as the Secretary), seeking the consolidation of the three NLRC
cases (NLRC Cases Nos. VII-09-0810-89, VII-08-0715-89, and VII-08-0742-89) with the
first stated case.

In an order dated January 31, 1990, Secretary of Labor Ruben D. Torres granted the
motion and ordered the consolidation of the three NLRC cases with NCMB-RBVII-NS-
06-050-89, as follows:

WHEREFORE, finding the Associated Labor Union's Motion to be

meritorious, the same is granted and NLRC Cases Nos. VII-09-0810-89,
VII-08-0715-89 and VII-08-0742-89 are hereby ordered consolidated with
the instant proceedings. The Labor Arbiter handling the same is directed
to immediately transmit the records of the said cases to the Asst. Regional
Director, DOLE Regional Office No. 7 who has been designated to hear
and receive the evidence of the parties.

SO ORDERED. 5

The Company's subsequent motion for reconsideration of the order consolidating the
cases was denied by the Secretary on March 5, 1990. 6 Thereafter, the Assistant
Regional Director of Regional Office No. VII, as directed, assumed jurisdiction over the
consolidated cases and set the same for reception of evidence.

Petitioner Company now comes to this Court assailing the aforesaid orders and alleging
grave abuse of discretion on the part of the public respondent in the issuance thereof.
The Union, as the bargaining agent of the rank and file workers of the Company, was
impleaded as the private respondent.

Petitioner Company submits that the exclusive jurisdiction to hear and decide the three
NLRC cases above-specified is vested in the labor arbiter as provided in paragraph (a)
(1) and (5) of Article 217 of the Labor Code.

Moreover, petitioner insists that there is nothing in Article 263 (g) of the Labor Code
which directs the labor arbiter to hold in abeyance all proceedings in the NLRC cases
and await instruction from the Secretary. Otherwise, so it postulates, Section 6, Rule V
of the Revised Rules of the NLRC which is invoked by the Secretary is null and void
since it orders the cessation of all proceedings before the labor arbiter and orders him to
await instructions from the Secretary in labor disputes where the Secretary bas
assumed jurisdiction, thereby amending Article 263 (g) of the Labor Code by enlarging
the jurisdiction of the Secretary.

Petitioner further contends that, granting arguendo that Section 6, Rule V of the Revised
Rules of the NLRC is in accordance with Article 263 (g) of the Labor Code, still the
Secretary should not have ordered the consolidation of the three unfair labor practice
cases with NCMB-RBVII-NS-06-050-89, since the Secretary assumed jurisdiction only
over the deadlock in the negotiation of the collective bargaining agreement and the
petition for contempt as a result of the said deadlock.

Respondents, on the other band, assert that the authority to assume jurisdiction over
labor disputes, vested in the Secretary by Article 263 (g) of the Labor Code, extends to
all questions and incidents arising therein causing or likely to cause strikes or lockouts
in industries indispensable to national interest.

Moreover, respondents counter that Section 6, Rule V of the Revised Rules of the
NLRC is in accordance with Article 263 (g) of the Labor Code, notwithstanding the
provisions of Article 217 of the Labor Code. To rule otherwise, they point out, would
encourage splitting of jurisdiction, multiplicity of suits, and possible conflicting findings
and decisions which could only result in delay and complications in the disposition of the
labor disputes.

It was also stressed that the three NLRC cases which respondent Secretary ordered
consolidated with the labor dispute over which he had assumed jurisdiction arose from
or are directly related to and are incidents of the said labor dispute.

Finally, respondents invoke the rule that all doubts in the implementation and
interpretation of the Labor Code provisions should be resolved in favor of labor. By
virtue of the assailed orders, the Union and its members were relieved of the burden of
having to litigate their interrelated cases in different fora.
There are three governing labor law provisions which are determinative of the present
issue of jurisdiction, viz.:

1. Article 217 (a) (1) and (5) of the Labor Code which provides:

Art. 217. Jurisdiction of Labor Arbiters and the Commission — (a) Except
as otherwise provided under this Code the Labor Arbiters shall have
original and exclusive jurisdiction to hear and decide . . . the following
cases involving all workers. . . .

1. Unfair labor practice cases;

xxx xxx xxx

5. Cases arising from any violation of Article 264 of this Code, including
questions involving the legality of strikes and lockouts; . . .

2. Article 263 (g) of the Labor Code which declares:

(g) When, in his opinion, there exists a labor dispute causing or likely to
cause a strike of lockout in an industry indispensable to the national
interest, the Secretary of Labor and Employment may assume jurisdiction
over the dispute and decide it or certify the same to the Commission for
compulsory arbitration. . . .

3. Section 6, Rule V of the Revised Rules of the NLRC which states:

Sec. 6. Disposition of cases. — . . .

Provided, that when the Minister (Secretary) of Labor and Employment

has assumed jurisdiction over a strike or lockout dispute or certified the
same to the Commission, the parties to such dispute shall immediately
inform the Minister (Secretary) or the Commission as the case may be, of
all cases between them pending before any Regional Arbitration Branch,
and the Labor Arbiter handling the same of such assumption or
certification, whereupon all proceedings before the Labor Arbiter
concerning such cases shall cease and the Labor Arbiter shall await
instructions from the Minister (Secretary) or the Commission.

The foregoing provisions persuade us that the Secretary did not gravely abuse his
discretion when he issued the questioned orders.

As early as 1913, this Court laid down in Herrera vs. Baretto, et al., 7 the fundamental
normative rule that jurisdiction is the authority to bear and determine a cause — the
right to act in a case. However, this should be distinguished from the exercise of
jurisdiction. The authority to decide a case at all and not the decision rendered therein is
what makes up jurisdiction. Where there is jurisdiction over the person and the subject
matter, the decision of all other questions arising in the case is but an exercise of that
jurisdiction. 8
In the present case, the Secretary was explicitly granted by Article 263 (g) of the Labor
Code the authority to assume jurisdiction over a labor dispute causing or likely to cause
a strike or lockout in an industry indispensable to the national interest, and decide the
same accordingly. Necessarily, this authority to assume jurisdiction over the said labor
dispute must include and extend to all questions and controversies arising therefrom,
including cases over which the labor arbiter has exclusive jurisdiction.

Moreover, Article 217 of the Labor Code is not without, but contemplates, exceptions
thereto. This is evident from the opening proviso therein reading "(e)xcept as otherwise
provided under this Code . . ." Plainly, Article 263 (g) of the Labor Code was meant to
make both the Secretary (or the various regional directors) and the labor arbiters share
jurisdiction, subject to certain conditions. 9 Otherwise, the Secretary would not be able
to effectively and efficiently dispose of the primary dispute. To hold the contrary may
even lead to the absurd and undesirable result wherein the Secretary and the labor
arbiter concerned may have diametrically opposed rulings. As we have said, "(i)t is
fundamental that a statute is to be read in a manner that would breathe life into it, rather
than defeat it." 10

In fine, the issuance of the assailed orders is within the province of the Secretary as
authorized by Article 263 (g) of the Labor Code and Article 217 (a) (1) and (5) of the
same Code, taken conjointly and rationally construed to subserve the objective of the
jurisdiction vested in the Secretary.

Our pronouncement on this point should be distinguished from the situation which
obtained and our consequent ruling in Servando's, Inc. vs. The Secretary of Labor and
Employment, et al. 11 wherein we referred to the appropriate labor arbiter a case
previously decided by the Secretary. The said case was declared to be within the
exclusive jurisdiction of the labor arbiter since the aggregate claims of each of the
employees involved exceeded P5,000.00. In Servando, the Secretary invoked his
visitorial and enforcement powers to assume jurisdiction over the case, the exclusive
and original jurisdiction of which belongs to the labor arbiter. We said that to uphold the
Secretary would empower him, under his visitorial powers, to hear and decide an
employee's claim of more than P5,000.00. We held that he could not do that and we,
therefore, overruled him.

In the present case, however, by virtue of Article 263 (g) of the Labor Code, the
Secretary has been conferred jurisdiction over cases which would otherwise be under
the original and exclusive jurisdiction of labor arbiters. There was an existing labor
dispute as a result of a deadlock in the negotiation for a collective bargaining agreement
and the consequent strike, over which the Secretary assumed jurisdiction pursuant to
Article 263 (g) of the Labor Code. The three NLRC cases were just offshoots of the
stalemate in the negotiations and the strike. We, therefore, uphold the Secretary's order
to consolidate the NLRC cases with the labor dispute pending before him and his
subsequent assumption of jurisdiction over the said NLRC cases for him to be able to
competently and efficiently dispose of the dispute in its totality.

Petitioner's thesis that Section 6, Rule V of the Revised Rules of the NLRC is null and
void has no merit. The aforesaid rule has been promulgated to implement and enforce
Article 263 (g) of the Labor Code. The rule is in harmony with the objectives sought to
be achieved by Article 263 (g) of the Labor Code, particularly the Secretary's
assumption of jurisdiction over a labor dispute and his subsequent disposition of the
same in the most expeditious and conscientious manner. To be able to completely
dispose of a labor dispute, all its incidents would have to be taken into consideration.
Clearly, the purpose of the questioned regulation is to carry into effect the broad
provisions of Article 263 (g) of the Labor Code.

By and large, Section 6, Rule V of the Revised Rules of the NLRC is germane to the
objects and purposes of Article 263 (g) of the Labor Code, and it is not in contradiction
with but conforms to the standards the latter requires. Thus, we hold that the terms of
the questioned regulation are within the statutory power of the Secretary to promulgate
as a necessary implementing rule or regulation for the enforcement and administration
of the Labor Code, in accordance with Article 5 of the same Code.

Besides, to uphold petitioner Company's arguments that the NLRC cases are alien and
totally separate and distinct from the deadlock in the negotiation of the collective
bargaining agreement is to sanction split jurisdiction which is obnoxious to the orderly
administration of justice. 12

Moreover, the rule is that all doubts in the interpretation and implementation of labor
laws should be resolved in favor of labor. In upholding the assailed orders of the
Secretary, the Court is only giving meaning to this rule. The Court should help labor
authorities provide workers immediate access to their rights and benefits, without being
hampered by arbitration or litigation processes that prove to be not only nerve-wracking,
but financially burdensome in the long run. 13 Administrative rules of procedure should
be construed liberally in order to promote their object and assist the parties, especially
the workingman, in obtaining just, speedy, and inexpensive determination of their
respective claims and defenses. By virtue of the assailed orders. The Union and its
members are relieved of the burden of litigating their interrelated cases in different
tribunals.

WHEREFORE. there being no grave abuse of discretion committed by the Secretary of

Labor and Employment, the petition at bar is hereby DISMISSED.

SO ORDERED.

LABOR LAWS

G.R. No. L-17750 August 31, 1962

A. L. AMMEN TRANSPORTATION COMPANY, INC., and CONSOLIDATED AUTO

LINES, INC., petitioners,
vs.
JOSE BORJA, respondent.

Manuel O. Chan for petitioners.

Madrid Law Office for respondent.

DIZON, J.:
Appeal by certiorari taken by A. L. Ammen Transportation Co., Inc. and Consolidated
Auto Lines, Inc. from an order of the Court of Industrial Relations in Case No. 6-V Bicol
dated May 9, 1960 and its Resolution of August 27, 1960 denying their motion for
reconsideration. The dispositive part of the appealed order is as follows:

IN VIEW OF THE FOREGOING, respondents are hereby ordered to pay

petitioner for the services rendered by the latter in excess of eight hours a day
from January 1, 1952 up to and including March 10, 1957. In connection
herewith, the Chief Examiner and Economist of this Court or his duly authorized
representative is hereby directed to proceed to the premises of the respondents
and make the necessary computations to determine the exact amount due to the
petitioner. The computation of the number of hours worked in excess of eight
hours a day should be based on the inspector's notebook of the petitioner and/or
the abstract thereof in the possession of the respondents. The count should start
from the first inspection up to the last, as stated in said inspector's notebooks.
But in no case shall count be stopped until 6:00 P.M. because if the last
inspection was terminated before said time, petitioner was given investigation
work.

The bonus of P30.00 a month is to be included as part of the basic salary of the
petitioner, it having been regularly given by respondents since 1951 for some
meritorious work rendered by petitioner and should, therefore, be deemed as part
of his regular salary. However, an allowance of 30 minutes a day for lunch break
should be deducted from the total number of working hours rendered by
petitioner. Further, the work not in excess of eight hours a day, rendered by
petitioner for respondents during Sundays and holidays should not be considered
as compensable overtime work because the respondents are public service
corporations.

Respondent Jose Borja was employed by petitioners as Supervising Inspector, with a

basic salary of P180.00 a month, P3.00 daily per diems, and a monthly bonus of
P30.00, from January 1, 1952 to March 10, 1957 when he was dismissed from the
service.

On April 15, 1958 respondent filed an action against petitioners in the Court of First
Instance of Albay (Civil Case No. 1905) to recover compensation for overtime work
rendered by him during the above-mentioned period, a damages. In their answer,
petitioners denied respondent claim for overtime pay, and alleged, by way of affirmative
defense, that respondent had filed the same claim with Department of Labor, Regional
Office No. IV at Naga City on May 29, 1957 but the same was dismissed with prejudice
upon the latter's petition, on April 30, 1958.

Pending trial of the abovementioned case, respondent commenced the present

proceedings in the Court of Industrial Relations substantially reproducing the claim
involve in Civil Case No. 1905. Petitioners, after likewise producing their answer in said
case, asserted, by way additional affirmative defense, the pendency of Civil Case No.
1905 between the same parties and for the same cause. .

After due trial, the Court of Industrial Relations issued its order of May 9, 1960 and its
resolution of August 27, 1960 subject of the present appeal.
To reverse the order and resolution appealed from, petitioner contends that the Court of
Industrial Relations erred firstly, in not holding that respondent's cause of action has
prescribed; secondly, in taking cognizance of this case although it had no jurisdiction
over the same; and lastly, in disregarding petitioner's memorandum to the respondent
prohibiting him to work in excess of eight (8) hours daily.

On the question of prescription, petitioner claims the respondent's action was

commenced only in December 1958; that in accordance with Republic Act 1994,
amending Commonwealth Act No. 444, any action to enforce a cause action under said
Act shall be commenced within three (3) years after its accrual; that respondent's cause
of action having accrued more than three years before December 1958, his action was
filed too late.1äwphï1.ñët

We find petitioner's contention to be untenable. The Court of Industrial Relations made

a finding of fact the effect that respondent had commenced his action against petitioner
before June 22, 1957 — the effective date of Republic Act No. 1994, amending
Commonwealth Act No. 444. This finding is not now reviewable.

But even on the merits, petitioner's contention is without merit. Respondent itself
admitted in its answer dated May 6, 1959, filed in the above-mentioned case No. 6-V
Bicol, that petitioner had originally filed his complaint with the Department of Labor,
Regional Office No. 4 on May 29, 1957. It is clear therefore that his action had already
been commenced before the effective date of Republic Act 1994, and is covered by the
exception provided for therein.

But petitioner contends in this regard that the phrase "actions already commenced"
employed in the statute should be construed as meaning only actions filed in a regular
court of justice. With this limited and narrow interpretation, we can not agree. The
statute under consideration is undoubtedly a labor statute and, as such, must be
liberally construed in favor of the laborer concerned. (Art. 1702, New Civil Code).
Consequently, the term "actions" should include every judicial and administrative
proceeding intended to enforce a right or secure redress for a wrong already committed.
Since respondent admittedly first filed his claim against petitioner with the Department
of Labor on May 29, 1957, in accordance with laws then in force, it seems clear that, as
already stated, it is covered by the exception provided for in Republic Act No. 1994,
whose date of effectivity was June 22, 1957.

On the question of jurisdiction, petitioner claims that, as respondent sought to collect

overtime wages, and nothing more, this case was not within the jurisdiction of the Court
of Industrial Relations.

This is also without merit. The complaint filed by respondent with the Court of Industrial
Relations alleged, inter alia, that he "was' separated automatically from the said
employment with defendants, and notwithstanding pleas for reinstatement defendants
refused and still refuse to reinstate plaintiff", and, aside from some specific reliefs,
respondent herein also asked that "other reliefs be granted him".

A reasonable interpretation of respondent's pleading fully justifies the opinion of the

Court of Industrial Relations to the effect that respondent, aside from overtime wages,
also sought reinstatement. The case, therefore, was within the jurisdiction of said Court.
In connection with its last contention, petitioner claims that the Court of Industrial
Relations erred in disregarding the memorandum of the company prohibiting
respondent from working in excess of eight hours daily. Such memorandum could not
fairly apply to respondent because according to the Court of Industrial Relations, there
sufficient evidence showing that inspite of it, respondent had received verbal
instructions from superior authority to inspect the first trip, noon trip, and last trip; that
this connection he had submitted to petitioner a daily report of inspection which stated
the period or number hours he had worked for the day, and that since January 1, 1952
up to and including March 10, 1957, respondent had been rendering overtime service
with full knowledge petitioner. All these show conclusively that the Court Industrial
Relations was right in awarding to respondent the corresponding overtime
compensation.

WHEREFORE, the order and resolution appealed from are affirmed, with costs.

G.R. No. 86020 August 5, 1994

RAMON CORPORAL, petitioner,

vs.
EMPLOYEES' COMPENSATION COMMISSION and GOVERNMENT SERVICE
INSURANCE SYSTEM, respondents.

Public Attorney's Office for petitioner.

QUIASON, J.:

This is a petition for certiorari questioning the decision of the Employees' Compensation
Commission which denied petitioner's claim for death benefits under Presidential
Decree No. 626, as amended.

Norma Peralta Corporal was employed as a public school teacher with assignment in
Juban, Sorsogon. On November 28 to November 30, 1977, she was confined at the
Esteves Memorial Hospital for acute coronary insufficiency and premature ventricular
contractions.

On June 30, 1983, she was assigned to the Banadero Elementary School in Daraga,
Albay. Norma had to walk three kilometers to and from said school as no transportation
was available to ferry her and other teachers from the national highway to the school.
During her fourth pregnancy, Norma suffered a complete abortion and was hospitalized
for two days at the Albay Provincial Hospital. After her maternity leave, Norma reported
back to work.

In March of 1984, she again conceived. However, in September of the same year, she
was transferred to the Kilicao Elementary School, where she had to walk more than one
kilometer of rough road. On December 2, 1984, she gave birth to a baby boy with the
help of a "hilot." An hour later, she was rushed to the Immaculate Conception Hospital
due to profuse vaginal bleeding. She underwent a hysterectomy but unfortunately, she
died on the same day due to "shock, severe hemorrhage" resulting from a "prolapse(d)
uterus post partum." Norma was 40 years old when she died.

Her husband, Ramon Corporal, petitioner herein, filed a claim for compensation benefit
with the Government Service Insurance System (GSIS). The GSIS denied petitioner's
claim thus:

Please be advised that on the basis of the proofs and evidences (sic)
submitted to the System, the cause of death of your wife, Shock
secondary to Severe Hemorrhage, Uterine PROLAPSE is not considered
an occupational disease as contemplated under the above-mentioned law
(P.D. No. 626). Neither was there any showing that her position as
Teacher, MECS, Albay had increased the risk of contracting her ailment
(Rollo, p. 23).

Petitioner filed several motions for the reconsideration of the denial of his claim to no
avail, because a re-evaluation of the claim by the Medical Evaluation and Underwriting
Group of the GSIS showed that there was "no basis to alter its previous action of denial
for the same reason . . . that her cause of death is non-work-connected as
contemplated under the law" and neither did her job as a teacher increase the risk of
contracting her ailment (Rollo, p. 25).

Petitioner appealed to the Employees' Compensation Commission (ECC). The ECC

requested the GSIS to re-evaluate petitioner's claim and to finally determine
compensability, with instruction that in case the claim is denied once more by the
System, the entire record of the case be elevated to the ECC. The GSIS reiterated its
denial of petitioner's claim.

On September 7, 1988, the ECC rendered a decision also denying petitioner's claim. It
said:

Medical studies show that Prolapsed Uterus may occur in infants and
nulliparous women as well as multiparas. Defects in innervation and in the
basic integrity of the supporting structures account(s) for prolapse(d) in the
first two and childbirth trauma for the latter. The cervix usually elongates
because the weight of the nagging vaginal tissues pulls it downward,
whereas the attached but weak cardinal ligaments tend(s) to support it. In
third degree or complete prolapse(d) both the cervix and the body of the
uterus have passed through the introitus and the entire vaginal canal is
inverted. (Obstetrics and Gynecology, Wilson, Beecham, Carrington, 3rd
Edition, p. 585).

On the other hand Acute Coronary Insufficiency are terms often used to
describe a syndrome characterized by prolonged substernal pain, usually
not relieved by vasodilators of a short period of rest due to a more severe
inadequacy of coronary circulation. The symptoms in this condition are
more intense and prolonged than in angina pectoris, but abnormal ECG
 and other laboratory findings associated with myocardial infarction are
absent. The syndrome is covered by a temporary inability of one's
coronary arteries to supply sufficient oxygenated blood to the heart
muscle. (Merck, Manual of Diagnosis & Therapy, pp. 100-101).

Based on the above medical discussion of the subject ailments, we

believe that the development of the fatal illness has no relation
whatsoever with the duties and working conditions of the late teacher.
There is no showing that the nature of her duties caused the development
of prolapse of the uterus. The ailment was a complication of childbirth
causing profuse vaginal bleeding during the late stage. We also consider
Acute Coronary Insufficiency as non-work-connected illness for the reason
that it is caused by temporary inability of one coronary arteries (sic) to
supply oxygenated blood to the heart muscle. There is no damage to heart
muscle. In view thereof, we have no recourse but to sustain respondent's
denial of the instant claim (Rollo, pp. 29-31).

Hence, petitioner filed the instant petition, asserting compensability of the death of his
wife.

II

Petitioner contends that although prolapsed uterus is not one of occupational diseases
listed by the ECC, his claim should proper under the increased risk theory. He anchors
such claim on the fact that as early as January 1984 or before Norma's fifth pregnancy,
he had noticed a spherical tissue which appeared like a tomato protruding out of
Norma's vagina and rectum. He avers that such condition was attributable to Norma's
long walks to and from her place of teaching — Banadero Elementary School, which is
situated on the side of the Mayon Volcano. Moreover, the roads leading to the school
are full of ruts and rocks, and, during the rainy season, are flooded and slippery.
Petitioner asserts that inspite of these, Norma continued to discharge her duties as a
public servant, notwithstanding her pregnancy and her prolapsed uterus.

Petitioner also contends that the findings of the respondents contravene the
constitutional provision on social justice. He alleges that since the workmen's
compensation law is a social legislation, its provisions should be interpreted liberally in
favor of the employees whose rights it intends to protect.

Under P.D. No. 626, as amended, for sickness and the resulting death of an employee
to be compensable, the claimant must show either: (a) that it is a result of an
occupational disease listed under Annex A of the Amended Rules on Employees'
Compensation with the conditions set therein satisfied; or (b) that the risk of contracting
the disease is increased by the working conditions (Santos v. Employees'
Compensation Commission, 221 SCRA 182 [1993]; Quizon v. Employees'
Compensation Commission, 203 SCRA 426 [1991]). Clearly, then, the principle of
aggravation and presumption of compensability under the old Workmen's
Compensation Act no longer applies (Latagan v. Employees' Compensation
Commission, 213 SCRA 715 [1992]).
Since petitioner admits that his wife died of an ailment which is not listed as
compensable by the ECC and he merely anchors his claim on the second rule, he must
positively show that the risk of contracting Norma's illness was increased by her working
conditions. Petitioner failed to satisfactorily discharge the onus imposed by law.

The fact that Norma had to walk six kilometers everyday and thereafter, a shorter
distance of more than one kilometer just to reach her place of work, was not sufficient to
establish that such condition caused her to develop prolapse of the uterus. Petitioner
did not even present medical findings on the veracity of his claim that Norma had a
tomato-like spherical tissue protruding from her vagina and rectum.

Norma developed prolapse of the uterus because she was multiparas, or one who had
more than one child, and quite beyond the safe child-bearing age when she gave birth
to her fifth child — she was already forty years old. Novak's Textbook on Gynecology
describes prolapse of the uterus (descensus uteri) as follows:

An extremely common condition, being far more frequent in elderly than in

young patients. This is explained by the increasing laxity and atony of the
muscular and fascial structures in later life. The effects of childbirth injuries
may thus make themselves evident, in the form of uterine prolapse, many
years after the last pregnancy. Pregnancies in a prolapsed uterus may
lead to numerous complications, as noted by Piver and Spezia.

The important factor in the mechanism of the prolapse is undoubtedly

injury or overstretching of the pelvic floor, and especially of the cardinal
ligaments (Mackenrodt) in the bases of the broad ligaments. Combined
with this there is usually extensive injury to the perineal structures,
producing marked vaginal relaxation and also frequent injury to the fascia
or the anterior or posterior vaginal walls, with the production of cystocele
or rectocele. Usually, various combinations of these conditions are seen,
although at times little or no cystocele or rectocele is associated with the
prolapse. Occasional cases are seen for that matter, in women who have
never borne children, and in these the prolapse apparently represents a
hernia of the uterus through a defect in the pelvic fascial floor (Emphasis
supplied).

The 1986 Current Medical Diagnosis & Treatment also describes the condition as
follows:

Uterine prolapse most commonly occurs as a delayed result of childbirth

injury to the pelvic floor (particularly the transverse cervical and
uterosacral ligaments). Unrepaired obstetric lacerations of the levator
musculature and perineal body augment the weakness. Attenuation of the
pelvic structures with aging and congenital weakness can accelerate the
development of prolapse.

The determination of whether the prolapse of Norma's uterus developed before or after
her fifth pregnancy is therefore immaterial since this illness is the result of the
physiological structure and changes in the body on pregnancy and childbirth.
With the evidence presented in support of the claim, petitioner's prayer cannot be
granted. While as a rule labor and social welfare legislation should be liberally
construed in favor of the applicant, (Tria v. Employees' Compensation Commission, 208
SCRA 834 [1992]), there is also the rule that such liberal construction and interpretation
of labor laws may not be applied where the pertinent provisions of the Labor Code and
P.D. No. 626, as amended, are clear and leave no room for interpretation.

The Court commiserates with the petitioner and his children for the loss of a loved one.
We also recognize the importance of the services rendered by public elementary school
teachers inspite of their meager salaries which are not proportionate to their immense
responsibility in molding the values and character of the youth in this country (De Vera
v. Employees' Compensation Commission, 133 SCRA 685 [1984]).

But under the legal milieu of the case, we can only suggest, not mandate, that
respondents grant ex gratia some form of relief to their members similarly situated as
petitioner's wife.

WHEREFORE, the petition is DENIED.

SO ORDERED.

AGRARIAN LAWS

G.R. No. 133706 May 7, 2002

FRANCISCO ESTOLAS, petitioner,

vs.
ADOLFO MABALOT, respondent.

PANGANIBAN, J.:

Agrarian laws must be interpreted liberally in favor of the grantee, in order to give full force and
effect to their clear intent, which is "to achieve a dignified existence for the small farmers" and to
make them "more independent, self-reliant and responsible citizens, and a source of genuine
strength in our democratic society."

The Case

Before us is a Petition for Review on Certiorari assailing the April 7, 1998 Decision1 of the Court
of Appeals2 (CA) in CA-GR SP No. 38268. The decretal portion of the assailed Decision reads
thus:
 "WHEREFORE, in view of the foregoing, the Petition is hereby DENIED DUE
COURSE and consequently, DISMISSED. No pronouncement as to costs."3

The Facts

The facts of the case are summarized by the CA as follows:

"On November 11, 1973, a Certificate of Land Transfer (hereinafter referred to as CLT)
was issued in favor of respondent over a 5,000 square meter lot (hereinafter referred to as
subject land) located in Barangay Samon, Sta. Maria, Pangasinan. Sometime in May,
1978, needing money for medical treatment, respondent passed on the subject land to the
petitioner for the amount of P5,800.00 and P200.00 worth of rice. According to
respondent, there was only a verbal mortgage; while according to petitioner, a sale had
taken place. Acting on the transfer, the DAR officials in Sta. Maria, Pangasinan
authorized the survey and issuance of an Emancipation Patent, leading to the issuance of
a Transfer Certificate of Title No. 3736 on December 4, 1987, in favor of the petitioner.

"Sometime in May, 1988, respondent filed a Complaint against the petitioner before the
Barangay Lupon in Pangasinan for the purpose of redeeming the subject land. When no
amicable settlement was reached, the case was referred to the Department of Agrarian
Reform’s (hereinafter referred to as DAR) regional office at Pilar, Sta. Maria,
Pangasinan.

"On July 8, 1988, Atty. Linda F. Peralta of the DAR’s District Office submitted her
investigation report finding that respondent merely gave the subject land to petitioner as
guarantee for the payment of a loan he had incurred from the latter; and recommending
that the CLT remain in the name of respondent and that the money loan be returned to
petitioner.

"Meanwhile, in a letter, dated September 20, 1988, petitioner insisted that the subject
land had been sold to him by respondent and requested the DAR to cancel the CLT in
respondent’s name. Another investigation was conducted on the matter which led to the
Order dated March 9, 1989, issued by DAR Regional Director Antonio M. Nuesa. In the
said Order, the DAR found the act of respondent in surrendering the subject land in favor
of petitioner as constituting abandonment thereof, and denied respondent’s prayer for
redemption of the subject land. Respondent’s request for reinvestigation was denied in a
Resolution, dated April 11, 1989.

"Thus, on May 3, 1989, respondent appealed the case to the DAR Central Office which,
on August 28, 1990, issued an Order reversing the assailed Order of DAR Regional
Director Antonio M. Nuesa and ordering the petitioner to return the subject land to
respondent. Petitioner’s Motion for Reconsideration was denied on June 8, 1992. He filed
an Appeal with the Office of the President which was dismissed in a Decision dated
August 29, 1994. Petitioner’s Motion for Reconsideration of the said Decision was also
denied in an Order dated November 28, 1994. Likewise, petitioner’s second Motion for
Reconsideration was denied in an Order dated July 5, 1995."4

Ruling of the Court of Appeals

The appellate court ruled that the subject land had been acquired by respondent by virtue of
Presidential Decree (PD) No. 27. This law prohibits the transfer of the land except by hereditary
succession to the heirs or by other legal modes to the government. Hence, the transfer of the
subject land to petitioner is void; it should be returned to respondent.

The CA further held that respondent had not effectively abandoned the property, because he tried
to redeem it in 1981 and 1983. The effort, however, failed because petitioner had demanded
P15,000 for it. The appellate court also noted that respondent continued to hold on to the
Certificate of Land Transfer (CLT) covering the subject land, and that he "would not have even
thought of bringing an action for the recovery of the same if he honestly believed that he had
already given it up in favor of [petitioner]."5

Hence, this recourse.6

Issues

In his anemic 6-page Memorandum,7 petitioner raises the following issues:

"A. Whether or not in law there is a valid abandonment made by Respondent Mabalot.

B. Whether the act of Respondent Mabalot in conveying to petitioner the right to possess
and cultivate the disputed parcel of land constitutes a valid abandonment thereby
rendering the property available for transfer to other bonafide farmers.

C. Whether the continuous possession and cultivation by petitioner since 1976 up to the
present has ripened into ownership over the five thousand (5,000) square meters parcel in
dispute.

D. Whether the issuance of an emancipation patent and thereafter a transfer certificate of

title in the name of petitioner has validated and legitimized possession and ownership
over the disputed property."8

The main issue may be worded as follows: did respondent abandon the subject property, thereby
making it available to other qualified farmer-grantees?

The Court’s Ruling

The Petition has no merit.

Main Issue:
Abandonment

The subject property was awarded to respondent by virtue of PD 27. On November 11, 1973,9 a
CLT was issued in his favor. PD 27 specifically provides that when private agricultural land --
whether classified as landed estate or not – is primarily devoted to rice and corn under a system
of sharecrop or lease tenancy, the tenant farmers thereof shall be deemed owners of a portion
constituting a family-size farm of five (5) hectares if not irrigated, and three (3) hectares if
irrigated.
Petitioner avers that respondent neither protested when the former had the subject land surveyed
and planted with 40 mango trees, nor attempted to return the money he had borrowed from
petitioner in 1976. Because the lot has been abandoned by respondent, the beneficiary, and
because PD 27 does not prohibit the transfer of properties acquired under it, petitioner theorizes
that the Department of Agrarian Reform (DAR) may award the land to another qualified farmer-
grantee.10

Non-transferability of Land Awarded Under PD 27

We do not agree. PD 27 specifically provides that title to land acquired pursuant to its mandate
or to that of the Land Reform Program of the government shall not be transferable except to the
grantee’s heirs by hereditary succession, or back to the government by other legal means. The
law is clear and leaves no room for interpretation.

Upon the promulgation of PD 27, farmer-tenants were deemed owners of the land they were
tilling. Their emancipation gave them the rights to possess, cultivate and enjoy the landholding
for themselves. These rights were granted by the government to them as the tillers and to no
other. Thus, to insure their continuous possession and enjoyment of the property, they could not,
under the law, effect any transfer except back to the government or, by hereditary succession, to
their successors.11

Furthermore, this Court has always ruled that agrarian laws must be interpreted liberally in favor
of the grantees in order to give full force and effect to the clear intent of such laws: "to achieve a
dignified existence for the small farmers"; and to make them "more independent, self-reliant and
responsible citizens, and a source of genuine strength in our democratic society."12

Neither are we convinced that an award under PD 27 may be transferred to another in case the
grantee abandons it. The law is explicit. Title acquired pursuant to PD 27 shall not be
transferable except to the grantee’s heirs by hereditary succession, or back to the government by
other legal means.

If a statute is clear, plain and free from ambiguity, it must be given its literal meaning and
applied without any interpretation.13 This rule rests on the presumption that the words employed
by the legislature correctly express its intent and preclude the courts from construing the law
differently.14 Similarly, a statute should be so construed as to effectuate its intent, advance the
remedy and suppress any mischief contemplated by the framers.15

This Court is not unaware of the various subterfuges resorted to by unscrupulous individuals,
who have sought to deprive grantees of their land by taking advantage of loopholes in the law
and the ignorance of poor beneficiaries. Consequently, the farmers who were intended to be
protected and uplifted by these laws find themselves back to where they started, sometimes
worse. This vicious cycle must be stopped.16

No Abandonment

The CA correctly opined that respondent has not abandoned the subject land. It said:

"x x x. It appears that respondent tried to pay off the loan and redeem the subject land in
1981 and in 1983, but did not succeed because of petitioner’s demands for the payment of
P15,000.00 (see Petition, Annex ‘G’, p. 1; Rollo, p. 29). It likewise appears that
 respondent did not deliver to petitioner his CLT which remains in his possession to date
(see Comment, p. 5; Rollo, p. 48a). Finally, respondent ‘would not have even thought of
bringing an action for the recovery of the same if he honestly believed that he had already
given it up in favor of (petitioner); he would not waste his time, effort and money,
especially if he is poor, to prosecute an unworthy action.’"17

For abandonment to exist, the following requisites must be proven: (a) a clear and absolute
intention to renounce a right or claim or to desert a right or property and (b) an external act by
which that intention is expressed or carried into effect. There must be an actual, not merely a
projected, relinquishment; otherwise, the right or claim is not vacated or waived and, thus,
susceptible of being appropriated by another.18 Administrative Order No. 2, issued on March 7,
1994, defines abandonment or neglect as a "willful failure of the agrarian reform beneficiary,
together with his farm household, to cultivate, till or develop his land to produce any crop, or to
use the land for any specific economic purpose continuously for a period of two calendar years."
In the present case, no such "willful failure" has been demonstrated. Quite the contrary,
respondent has continued to claim dominion over the land.

No Valid Reallocation

Furthermore, even if respondent did indeed abandon his right to possess and cultivate the subject
land, any transfer of the property may only be made in favor of the government. In Corpuz v.
Grospe,19 the Court held that there was a valid transfer of the land after the farmer-grantee had
signed his concurrence to the Samahang Nayon Resolution surrendering his possession of the
landholding. This voluntary surrender to the Samahang Nayon constituted a surrender or transfer
to the government itself.

Such action forms part of the mechanism for the disposition and the reallocation of farmholdings
of tenant-farmers who refuse to become beneficiaries of PD 27. Under Memorandum Circular
No. 8-80 of the then Ministry of Agrarian Reform, the Samahan shall, upon notice from the
agrarian reform team leader, recommend other tenant-farmers who shall be substituted to all
rights and obligations of the abandoning or surrendering tenant-farmer. Such cooperative or
samahan is established precisely to provide a strong social and economic organization that will
ensure that farmers will reap and enjoy the benefits of agrarian reform.20

In the present case, there was no valid transfer in favor of the government. It was petitioner
himself who requested the DAR to cancel respondent’s CLT and to issue another one in his
favor.21 Unlike in the above-cited case, respondent’s land was not turned over to the government
or to any entity authorized by the government to reallocate the farmholdings of tenant-farmers
who refuse to become beneficiaries of PD 27. Petitioner cannot, by himself, take over a farmer-
beneficiary’s landholding, allegedly on the ground that it was abandoned. The proper procedure
for reallocation must be followed to ensure that there was indeed an abandonment, and that the
subsequent beneficiary is a qualified farmer-tenant as provided by law.

WHEREFORE, the Petition is hereby DENIED and the assailed Decision AFFIRMED. Costs
against petitioner.

SO ORDERED.
RULES OF COURT

G.R. No. L-55102 June 19, 1985

GORGONIO TEJERO, petitioner,

vs.
HON. EULALIO D. ROSETE, Presiding Judge of the Court of First Instance of
Misamis Oriental, Branch IV and FRANCISCO ARES, respondents.

Cecilio A. Pepito, Jr. for petitioner.

Virgilio Cabanlet for private respondent.

CUEVAS, J.:

Petition for Certiorari, with prayer for the issuance of a writ of preliminary injunction, to
annul and set aside the, Order 1 dated July 28, 1980, issued by the Hon. respondent
Judge in Civil Case No. 6728 entitled "Gorgonio Tejero versus Francisco Ares", for
Cancellation of Contract with Damages; and the Order 2 dated August 8, 1980 denying
petitioner's motion for reconsideration.

On September 4, 1979, herein petitioner Gorgonio Tejero filed with the then Court of
First Instance of Misamis Oriental, a complaint 3 for cancellation of contract with
damages, against herein private respondent Francisco Ares. The case was docketed in
the said court as Civil Case No. 6728 and assigned to Branch IV thereof, presided by
the Hon. respondent Judge.

The complaint, among others, alleged that —

2. Plaintiff is the owner and proprietor of the Tejero Subdivision, a private

residential subdivision located at Patag, Cagayan de Oro City;

3. On May 23, 1963, plaintiff and defendant entered into a Purchase

Agreement whereby plaintiff agreed to sell and defendant agreed to buy
for the sum of Four Thousand Three Hundred Sixty-Eight Pesos
(P4,368.00) two (2) parcels of residential land situated at the plaintiff's
aforementioned subdivision;

4. Under the terms of said agreement, defendant bound to pay the

aforesaid consideration in thirty-nine (39) monthly installments ...;

5. Defendant failed to pay and comply with his obligation under the
aforecited agreement ...
Plaintiff therefore prayed for judgment cancelling the Land Purchase Agreement and
ordering defendant to vacate the premises and return possession thereof to the plaintiff;
to pay attorney's fees, damages and costs.

Private respondent, then defendant, filed his Answer with Counterclaim 4 on November
3, 1979, alleging, as special defenses that the court has no jurisdiction over the action,
the matter relating thereto being now governed by the National Housing Authority; tat
defendant has a justifiable reason to suspend the payment of his remaining obligation
with the plaintiff; that defendant has fully paid his obligation with plaintiff thru valid
tender of payment and consignation; and that consequently plaintiff has no cause of
action against the defendant.

By way of counterclaim, private respondent prays for the recovery of moral damages in
the sum of P10,000.00, P3,000.00 attorney's fees, exemplary damages as the Court
may in its discretion award and costs of suit.

The issues having been joined, the case was set for pre-trial conference on July 28,
1980.

At this scheduled pre-trial conference, which is admittedly the first pre-trial schedule,
petitioner (then plaintiff failed to appear "due to sickness leading to his paralysis".
Nevertheless, counsel for petitioner, Atty. Cecilio A. Pepito, Jr. appeared, with a
notarized Special Power of Attorney 5 dated July 15, 1980 signed by petitioner
Gorgonio Tejero, the pertinent portion of which reads —

I Gorgonio Tejero ... do hereby name, constitute and appoint Atty. Cecilio
A. Pepito, Jr. as my attorney-in-fact for the purpose of representing my
interest in Civil Case No. 6728 before Branch IV, Court of First Instance of
Misamis Oriental.

Further, I hereby grant authority unto my said attorney-in-fact to settle or

compromise the above-stated case for and in my behalf.

xxx xxx xxx

On the same day, July 28, 1980, respondent Judge issued his now assailed Order, 6
reading as follows:

For failure of plaintiff to appear in Court this morning for pre-trial, despite
due notice, the complaint is hereby dismissed for non-suit. Counsel for
plaintiff although equipped with a special power of attorney is not in a
position to say whether the signatures appearing in the receipts of
payments are those of the plaintiff or not and said counsel is not in a
position to know whether the person who signed the receipts of payments
were authorized by the plaintiff or not, the special power of attorney then
of counsel is deficient and so plaintiff himself should have come to Court.
The special power of attorney which is executed in favor of his counsel
defeats the purpose of a pretrial therefore.
 The reception of the evidence for the counterclaim of defendant is hereby
set for August 8, 1980 at 2:00 o'clock in the afternoon, subject, however,
to the result of the motion for reconsideration that may be filed by plaintiff.

SO ORDERED.

Petitioner's Motion for Reconsideration 7 of the said order was denied by respondent
Judge in the following Order, 8 to wit:

The reason for declaring plaintiff non-suited and for dismissing the
complaint was the insufficiency of the Special Power of Attorney because
counsel as attorney-in-fact could not tell whether the signatures appearing
in the receipts of payments presented by the defendant were signed by
the plaintiff or whether the plaintiff authorized the persons who signed the
receipts for the plaintiff. The only person who could Identify the signatures
and who could say whether the persons who signed the receipts of
payments were authorized by the plaintiff is the plaintiff himself, as his
presence was necessary but despite which he did not come to court.
Besides, the motion for reconsideration did not furnish any copy to the
adverse counsel. This is an incident which could not be considered ex-
parte.

In view thereof, said motion for reconsideration is, therefore, denied. In the
meantime, the reception of the evidence in support of the counterclaim is
hereby reset August 19, 1980 at 2:00 o'clock in the afternoon.

SO ORDERED.

Petitioner's second motion for reconsideration 9 having been denied, 10 he now comes
before this Court, through the instant Petitioner, 11 claiming that respondent Judge
committed grave abuse of discretion in dismissing his complaint as well as in denying
his motion for reconsideration.

We find the petitioner to be meritorious.

While it is true that under Section 1, Rule 20 of the Rules of Court, it is mandatory for
the parties and their counsel to appear at the pre-trial to consider inter alia "the
possibility of an amicable settlement, the simplication of the issues, the possibility of
obtaining stipulations or admissions of facts, totally or partially, and such other matters
as may aid in the prompt disposition of the action"; and that a party who fails to appear
at the pre-trial may be non-suited or considered as in default, 12 this rule was by no
means intended as an implacable bludgeon but as a tool to assist the trial courts in the
orderly and expeditious conduct of trials. 13 Time and again We have emphasized that
the rules should be liberally construed in order to promote their object and assist the
parties in obtaining not only speedy, but more importantly, just and inexpensive
determination of every action and proceeding. 14

It cannot be overstressed that the application of the procedural rules on

dismissal of actions (as well as on defaults) rests upon the sound judicial
discretion of the trial courts and such discretion must be exercised wisely
 and prudently, never capriciously, with a view to substantial justice in the
light of the Rules' express mandate that they be liberally construed in
order to promote their object and to assist the parties in obtaining just,
speedy and inexpensive determination of every action or proceeding." 15

It will be noted that in the cases 16 where this Court sustained the trial court's non-suit
orders for non-appearances, the pattern and scheme to delay disposition of the case or
a wanton failure to observe the mandatory requirement of the rules appeared evident.

In the case at bar, however, no such pattern to delay or wanton attitude on the part of
the petitioner appeared disclosed by the records.

The complaint was filed on September 4, 1979; the answer of private respondent, on
November 3, 1979; and the case was set for the pre-trial for the first time on July 28,
1980. It is not seriously disputed that the failure of petitioner to appear at the first
scheduled pre-trial was due to illness which later led to his paralysis. It is not disputed
that counsel for petitioner appeared properly clothed with a special power of attorney
executed by the petitioner. The lower court's order of dismissal solely because of the
inability of counsel for petitioner "to state whether the signatures appearing in the
alleged receipts of payments are those of the plaintiff or not" is hasty and drastic,
considering that it is the first time the case was scheduled for pre-trial conference. While
the intention of respondent Judge to terminate the subject case promptly is laudable,
the better procedure should have been and the ends of justice would have been better
served had his HONOR reset the case for another pre-trial to enable counsel for
petitioner to verify from his client the authenticity of the signatures appearing on the
questioned receipts; or it could have declared the pre-trial terminated and set the case
for trial on the merits so that the parties, particularly the private respondent, could
present their evidence. At any rate, no substantial right of the private respondent has
been affected when counsel for petitioner failed or refused to admit the genuineness of
the signatures appearing on the disputed receipts, since private respondent has all the
right to present evidence thereon at the trial on the merits.

Inconsiderate dismissals, even if without prejudice, do not constitute a

panacea nor a solution to the congestion of court dockets; while they lend
a deceptive cure of efficiency to records of individual judges, they merely
postpone the ultimate reckoning between the parties. In the absence of
clear lack of merit or intention to delay, justice is better served by a brief
continuance, trial on the merits, and final disposition of the cases before
the court. 17

WHEREFORE, the Orders complained of, the first dated July 28, 1980 dismissing
petitioner's complaint and that dated August 8, 1980 denying petitioner's motion for
reconsideration are hereby ANNULLED and SET ASIDE. Civil Case No. 6728 is hereby
REMANDED to the proper Regional Trial Court of Misamis Oriental for further
proceedings.

No costs.

SO ORDERED.
G.R. No. 77154

JESUS DEL ROSARIO, petitioner,

vs.
HON. JAIME HAMOY, Presiding Judge, RTC, Branch XV, Region IX, Zamboanga City,
and WILEADO DE LEON, DOMINGO DE LEON, CRISTINO DE LEON, HENCIANO
DE LEON, MARCIANO AIZON, and EPIFANIA DE LEON, respondents.

SARMIENTO, J.:

For want of a one-peso documentary stamp in a special power of attorney for pre-trial purposes,
in lieu of the personal appearance of the plaintiff, the petitioner in this case, the respondent Judge
declared him non-suited and dismissed the complaint "for failure of the plaintiff to appear for
pre-trial conference. 1 We do not agree. The respondent Judge manifestly erred. He acted with
indecent haste. He could have easily required the counsel for the plaintiff to buy the required
one-peso documentary stamp outside the court room and affix the same to the special power of
attorney and that respite would not have taken ten minutes. Had he been less technical and more
sensible, the present proceedings and the consequent waste of time of this Court and of his own
would have been avoided.

The respondent trial Judge had three chances to rectify his grave error but he missed all of them.
He was adamant. By such rigidity he denied the petitioner substantial justice.

(1) He procrastinated when the plaintiff and his counsel immediately after the hearing on the
same morning of July 25, 1986, made oral representations with him inside his chamber for the
reconsideration of his order declaring the plaintiff non-suited and dismissing the complaint. The
plaintiff, through his counsel, explained that he was actually inside the court room while his
lawyer and the defendants' counsel, were arguing, but he (plaintiff) was too timorous to interrupt
the proceedings and make known his presence to his counsel or to the court. Despite the
immediacy of the representations and the plausibility of this explanation considering the
plaintiff's nescience, being merely an agricultural tenant and can hardly write his name, the
respondent Judge still required him to file a written motion and set it for hearing "in accordance
with the Rules of Court."

(2) Complying, the plaintiff's counsel forthwith filed the written motion, 2 duly supported by an
Affidavit of Merit of the plaintiff, on the same day, July 25, 1986, and set it for hearing as
ordered by the respondent Judge. This motion for reconsideration was denied "for lack of merit"
on August 29, 1986. 3 The order of denial states in part:

xxx xxx xxx

A judicious appraisal of the facts alleged in the motion for reconsideration and in the
accompanying affidavit of merit fail to convince the Court to reconsider the Order. As
admitted by the plaintiff, he was inside the Court room when the case was caned for pre-
 trial conference and when his counsel, Atty. Alejandro Saavedra and defendants' counsel
Atty. Navarro Belar Navarro were arguing about the insufficiency of the special power of
attorney, but he never made known his presence to the Court or to his counsel or to the
defendants. He approached his counsel and presented himself to him when they were
already outside the Courtroom and after the case was already dismissed. To the mind of
the Court, the foregoing circumstances detailed by the plaintiff do not constitute
excusable negligence or mistake. 4

xxx xxx xxx

(3) Undaunted, seven days later, on September 5, 1986, the petitioner filed a second motion for
reconsideration 5 verified by his counsel, setting it for hearing on September 19, 1986, which
was promptly denied on the same day of the hearing.

And, on October 7, 1986, as a coup de grace, an over-kill to be sure, the respondent Judge issued
a court order which reads:

xxx xxx xxx

The Court having denied the second motion for reconsideration for not being allowed by
Section 4 of the Interim Rules as per Order entered on September 19, 1986, the case at
bar is therefore considered closed and terminated.

SO ORDERED. 6

xxx xxx xxx

The respondent Judge lost sight of the fact that even the Rules of Court themselves, fortified by
jurisprudence, mandate a liberal construction of the rules and the pleadings in order to effect
substantial justice. 7 After an, "[O]verriding all the foregoing technical considerations is the
trend of the rulings of this Court to afford every party-litigant the amplest opportunity for the
proper and just determination of his cause, freed from the constraints of technicalities. 8

In a recent case 9 where the trial court, as in this instance, declared the petitioner non-suited for
failure to appear at the pre-trial conference, and consequently dismissed the complaint, this Court
reiterated the doctrine of liberality in the construction of the rules of procedure to be followed by
all courts.

While it is true under Section 1, Rule 20 of the Rules of Court, it is mandatory for the
parties and their counsel to appear at the pretrial to consider inter-alia "the possibility of
an amicable settlement, the simplification of the issues, the possibility of obtaining
stipulations or admission of facts, totally or partially, and such other matters as may aid
in the prompt disposition of the action," and that a party who fails to appear at the pre-
trial may be non-suited or considered as in default, this rule was by no means intended as
an implacable bludgeon but as a tool to assist the trial courts in the orderly and
expeditious conduct of trials. Time and again WE have emphasized that the rule should
be liberally construed in order to promote their object and assist the parties in obtaining
not only speedy, but more importantly, just and inexpensive determination of every
action and proceeding.10
Practically on all fours with this case is Gabucan vs. Hon. Judge Luis D. Manta, et al., 11 in
which the petition for the probate of a notarial will was dismissed on the sole ground that the will
did not bear a thirty-centavo documentary stamp, and, hence, according to the respondent Judge,
it was not admissible in evidence, citing section 238 of the Tax Code, now section 250 of the
1977 Tax Code, which reads:

xxx xxx xxx

SEC. 238. Effect of failure to stamp taxable document. — An instrument, document, or

paper which is required by law to be stamped and which has been signed, issued,
accepted, or transferred without being duly stamped, shall not be recorded, nor shall it or
any copy thereof or any record of transfer of the same be admitted or used in evidence in
any court until the requisite stamp or stamps shall have been affixed thereto and
cancelled.

No notary public or other officer authorized to administer oaths shall add his jurat or
acknowledgment to any document subject to documentary stamp tax unless the proper
documentary stamps are affixed thereto and cancelled.12

In reversing the interpretation of the provisions of sections 238 and 250 of the old Tax Codes
above copied which are Identical to those of section 214 of the National Internal Code of 1986,
as amended, the law now obtaining, this Court held:

xxx xxx xxx

What the probate court should have done was to require the petitioner or proponent to
affix the requisite thirty-centavo documentary stamp to the notarial acknowledgment of
the will which is the taxable portion of that document.

That procedure may be implied from the provision of section 238 that the non-
admissibility of the document, which does not bear the requisite documentary stamp,
subsists only "until the requisite stamp or stamps shall have been affixed thereto and
cancelled."

Thus, it was held that the documentary stamp may be affixed at the time the taxable
document is presented in evidence (Del Castillo vs. Madrilena, 49 Phil. 749). If the
promissory note does not bear a documentary stamp, the court should have allowed
plaintiff's tender of a stamp of supply the deficiency. (Rodriguez vs. Martinez, 5 Phil. 67,
71. Note the holding in Azarraga vs. Rodriguez, 9 Phil. 637, that the lack of the
documentary stamp on a document does not invalidate such document. See Cia. General
de Tabacos vs. Jeanjaquet, 12 Phil. 195, 201-2 and Delgado and Figueroa vs. Amenabar,
16 Phil. 403, 405-6.)13

This is as it should be because the quality of justice is not strained.

WHEREFORE, the orders of the trial court complained of the first dated July 25, 1986 declaring
the petitioner non-suited and dismissing his complaint, and those dated August 29, 1986 and
October 7, 1986, denying the petitioner's motions for reconsideration are hereby ANNULLED
and SET ASIDE. Civil Case No. 3331 is hereby remanded to the respondent trial court for
further proceedings. No costs.
Let a copy of this Decision be attached to the personal record of the respondent judge.

SO ORDERED.

G.R. No. 170728 August 31, 2011

D. M. WENCESLAO AND ASSOCIATES, INC., Petitioner,

vs.
CITY OF PARAÑAQUE, PARAÑAQUE CITY ASSESSOR, PARAÑAQUE CITY
TREASURER and PARAÑAQUE CITY COUNCIL, Respondents.

DECISION

VILLARAMA, JR., J.:

Challenged in this petition for review on certiorari are the October 15, 2004 and November 24,
2005 Resolutions1 of the Court of Appeals (CA) in CA-G.R. CV UDK No. 9532-D. The CA
dismissed the appeal of D.M. Wenceslao and Associates, Inc. from the Order2 of the Regional
Trial Court (RTC) of Parañaque City in Civil Case No. 03-048 for nonpayment of docket and
other lawful fees.

The facts are as follows:

Petitioner D.M. Wenceslao and Associates, Inc. is a domestic corporation engaged in the
construction business. It is the registered owner of more than 200,000 square meters of reclaimed
land in Barangay Tambo, Parañaque City, now known as the Aseana Business Park.

In 1996, the City of Parañaque passed Ordinance No. 96-16, providing for the market values of
the properties within its jurisdiction as basis for assessment and real property taxation. The
ordinance also provided for a discount of 70% of the base value of the developed lots in the area,
for low, sunken and undeveloped parcels of land, such as the lots reclaimed and owned by
petitioner.

The City Assessor of Parañaque, however, assessed petitioner's lots based on the rates applicable
to Barangay Baclaran, which rates were higher than those applicable to properties in Barangay
Tambo. Petitioner informed the City Assessor of the wrongful assessment in 1998; hence,
starting on the 3rd quarter of 1998, the Tambo rates were used, although petitioner claimed that
the discount provision in the ordinance was still not applied.

Subsequently, the City Treasurer declared petitioner’s properties delinquent and included them in
the auction sale scheduled on February 7, 2003. On February 4, 2003, petitioner filed with the
RTC of Parañaque City a Complaint3 for collection of excess real property taxes and damages
with prayer for the issuance of a temporary restraining order and/or preliminary injunction
seeking to restrain respondents from enforcing the foreclosure sale. The RTC denied petitioner’s
prayer for the issuance of a writ of preliminary injunction. Thus, to prevent its properties from
being auctioned, petitioner paid under protest the amount of ₱101,422,581.75 on February 7,
2003.4 Said payment brought the total amount of real property taxes paid by petitioner to
₱111,424,157.10 for the taxable years 1995 to 2002.
On March 20, 20035 petitioner amended its complaint. Essentially, petitioner argued that had the
correct assessment been made, it should have paid only ₱6,172,979.516 instead of
₱111,424,157.107 to the City of Parañaque. Petitioner argued that pursuant to Ordinance No. 96-
16, the properties located in Barangay Tambo should have been assessed based on the market
value of ₱3,000.00 for the years 1995 to 1996 and ₱4,000.00 for the years 1997 to 1999.
However, the City Assessor used the market value applicable to properties located in Barangay
Baclaran, which were subject to a higher rate. Petitioner also pointed out that the ordinance
provided that undeveloped parcels of land shall have 70% of the base value of the nearest
developed or improved lots located in that area. Thus, petitioner claimed that the City of
Parañaque is liable to return the excess realty taxes under the principle of solutio indebiti.

Respondents filed a motion to dismiss based on the following grounds: (1) the cause of action is
barred by prior judgment or by the statute of limitations; (2) the court has no jurisdiction over the
subject matter of the claim; and (3) the complaint is filed in violation of the rule on forum
shopping. Respondents contended that petitioner’s cause of action based on solutio indebiti is in
reality a smoke screen to its real intention which is to claim for tax refund. As such, petitioner’s
action has already prescribed pursuant to the provisions of the Local Government Code.

On November 20, 2003, the RTC issued an Order granting the motion to dismiss. It found that
petitioner’s cause of action was really based on Section 2538 of the Local Government Code. As
such, petitioner’s cause of action had already prescribed inasmuch as the allegations in the
complaint show that the alleged overpayment of real property tax occurred in 1995-1999 and
2001-2002 while the complaint was only filed in February 4, 2003. Moreover, the RTC ruled that
the action to undo the alleged wrong tax assessments and collections in order to ask for refund
would make the court do a technical job reserved for special administrative bodies like the Local
Board of Assessment Appeals and the Central Board of Assessment Appeals.

Petitioner sought reconsideration of the order, but its motion was denied by the RTC on May 4,
2004.9

On May 17, 2004, petitioner filed a Notice of Appeal,10 which was approved by the RTC on May
24, 2004.11 Accordingly, the Branch Clerk of Court was directed to transmit the entire records of
the case to the CA.

As earlier mentioned, the CA dismissed petitioner’s appeal in a Resolution dated October 15,
2004, to wit:

For failure of plaintiff-appellant to pay the required docketing fees, the appeal interposed in this
case is deemed abandoned and is accordingly DISMISSED.

SO ORDERED.12

Petitioner filed a motion for reconsideration13 alleging that it never intended to abandon its
appeal. It explained that because of extremely heavy workload and by excusable inadvertence,
petitioner’s counsel overlooked the fact that the required appeal fee was not paid at the time of
the filing of the notice of appeal. Petitioner also informed the CA that its counsel had already
paid the appeal fee of ₱3,000 on October 20, 2004.

In a Resolution dated November 24, 2005, the CA denied petitioner’s motion for reconsideration,
thus:
WHEREFORE, plaintiff-appellant’s motion for reconsideration is DENIED for lack of sufficient
merit.

SO ORDERED.14

The CA held that it could no longer reconsider the October 15, 2004 Resolution considering that
the appealed dismissal order of the trial court has become final and executory due to petitioner’s
failure to perfect the appeal by paying the docket fees on time. It explained that although there
are recognized circumstances that warrant the relaxation of the rules on payment of docket fees,
such as fraud, accident, mistake, excusable negligence, or a similar supervening casualty, the
heavy workload and inadvertence of counsel are not among them. The CA also noted that in this
case, petitioner was delayed in the payment of the docket fees for five months counted from the
filing of the notice of appeal. Finding no justifiable reason for such delay, the CA ruled that it
can no longer accept such payment.

Undaunted, petitioner filed the instant petition before this Court.

The sole issue for our resolution is whether the CA erred in dismissing petitioner’s appeal for
late payment of docket fees.

Petitioner contends that it immediately paid the appeal fee of ₱3,000 on October 20, 2004 after
having been advised of its nonpayment, and such action negates the theory that it intended to
abandon its appeal. Petitioner adds that it would not abandon its case to recover the amount of
₱105,251,177.59 especially after it had paid ₱2,111,914.30 in docket and other legal fees.
Petitioner argues that the court, in the exercise of its equity jurisdiction and liberally applying the
rules of procedure, may give due course to the appeal despite its failure to pay the docket fees
within the reglementary period.

On the other hand, respondents counter that petitioner failed to perfect its appeal. They stress that
under Section 4, Rule 41 of the 1997 Rules of Civil Procedure, as amended, petitioner should
have paid the appellate docket fees within the period to appeal or within fifteen (15) days from
notice of the judgment appealed from. Moreover, the payment of appellate docket and other legal
fees within the prescribed period is both mandatory and jurisdictional. Since the payment of the
docket fees was made more than one-hundred fifty (150) days after the expiration of the period
for the perfection of an appeal, the CA did not acquire jurisdiction over the case except to order
its dismissal.

We agree with respondents’ contention.

The rule that appellate court docket and other lawful fees must be paid within the period for
taking an appeal is stated in Section 4, Rule 41 of the 1997 Rules of Civil Procedure, as
amended:

SEC. 4. Appellate court docket and other lawful fees. – Within the period for taking an appeal,
the appellant shall pay to the clerk of the court which rendered the judgment or final order
appealed from, the full amount of the appellate court docket and other lawful fees. Proof of
payment of said fees shall be transmitted to the appellate court together with the original record
or the record on appeal.

Likewise, Section 3, Rule 41, of the same Rules state:

SEC. 3. Period of ordinary appeal, x x x. - The appeal shall be taken within fifteen (15) days
from notice of the judgment or final order appealed from. Where a record on appeal is required,
the appellant shall file a notice of appeal and a record on appeal within thirty (30) days from
notice of the judgment or final order. x x x

xxxx

In this case, petitioner received a copy of the trial court's Order on May 14, 2004. Thus, pursuant
to Section 3, Rule 41, in relation to Section 1,15 Rule 22, it had until May 31, 2004 within which
to perfect its appeal by filing within that period the notice of appeal and paying the appellate
docket and other legal fees. On May 17, 2004, petitioner filed its notice of appeal within the
reglementary period. We note, however, that it paid the required docket fees only on October 20,
2004, or late by almost five months.

It bears stressing that payment of docket and other fees within this period is mandatory for the
perfection of the appeal. Otherwise, the right to appeal is lost. This is so because a court acquires
jurisdiction over the subject matter of the action only upon the payment of the correct amount of
docket fees regardless of the actual date of filing of the case in court. The payment of appellate
docket fees is not a mere technicality of law or procedure. It is an essential requirement, without
which the decision or final order appealed from becomes final and executory as if no appeal was
filed.16

We held in one case that the CA correctly dismissed the appeal where the docket fees were not
paid in full within the prescribed period of fifteen (15) days but were paid forty-one (41) days
late due to inadvertence, oversight, and pressure of work.17 In another case, we ruled that no
appeal was perfected where half of the appellate docket fee was paid within the prescribed
period, while the other half was tendered after the period within which payment should have
been made.18

Evidently, where the appellate docket fee is not paid in full within the reglementary period, the
decision of the trial court becomes final and no longer susceptible to an appeal. For once a
decision becomes final, the appellate court is without jurisdiction to entertain the appeal.19
1awphi1

Moreover, pursuant to Section 1, Rule 50 of the 1997 Rules of Civil Procedure, as amended, the
CA, on its own motion or that of the appellee, may dismiss the appeal on the ground that
appellant failed to pay the docket and other lawful fees.20 Section 1(c), Rule 50 of the Rules
provides that:

Section 1. Grounds for dismissal of appeal.–An appeal may be dismissed by the Court of
Appeals, on its own motion or on that of the appellee, on the following grounds:

xxxx

(c) Failure of the appellant to pay the docket and other lawful fees as provided in Section 4 of
Rule 41;

xxxx

Pertinently, this Court’s ruling in Cu-Unjieng v. Court of Appeals21 is instructive:

With the reality obtaining in this case that payment of the appellate docket fees was belatedly
made four (4) months after the lapse of the period for appeal, it appears clear to us that the CA
did not acquire jurisdiction over petitioner’s appeal except to order its dismissal, as it rightfully
did. Thus, the September 1, 1998 decision of the RTC has passed to the realm of finality and
became executory by operation of law. (Underscoring ours.)

The right to appeal is not a natural right. It is also not part of due process. It is merely a statutory
privilege and may be exercised only in the manner and in accordance with the provisions of law.
Thus, one who seeks to avail of the right to appeal must comply with the requirements of the
Rules. Failure to do so often leads to the loss of the right to appeal.

With regard to petitioner’s plea for a liberal treatment of the rules in order to promote substantial
justice, the Court finds the same to be without merit. It is true that the rules may be relaxed for
persuasive and weighty reasons to relieve a litigant from an injustice commensurate with his
failure to comply with the prescribed procedures.22 However, it must be stressed that procedural
rules are not to be belittled or dismissed simply because their non-observance may have
prejudiced a party’s substantive rights. Like all rules, they are required to be followed except
only for the most persuasive of reasons when they may be relaxed.23

In this case, petitioner has not shown any reason such as fraud, accident, mistake, excusable
negligence, or a similar supervening casualty which should justify the relaxation of the rules.24
The explanation advanced by petitioner’s counsel that the failure to pay the appellate docket and
other legal fees within the prescribed period was due to his extremely heavy workload and by
excusable inadvertence does not convince us.

WHEREFORE, the petition is DENIED. The Resolutions dated October 15, 2004 and
November 24, 2005 of the Court of Appeals in CA-G.R. CV UDK 9532-D are hereby
AFFIRMED.

With costs against the petitioner.

SO ORDERED.

LAW ON ADOPTION
G.R. No. L-30576 February 10, 1976

ROBIN FRANCIS RADLEY DUNCAN and MARIA LUCY CHRISTENSEN, petitioners,

vs.
COURT OF FIRST INSTANCE OF RIZAL (Branch X) PRESIDED OVER BY HON.
JUDGE HERMINIO C. MARIANO, respondent.

Susano A. Velasquez for petitioners.

Solicitor General Felix Q. Antonio, Acting Assistant Solicitor General Hector C. Fule and
Trial Attorney Herminio Z. Florendo for respondent.
ESGUERRA, J.:

Petition for review on certiorari of the decision of respondent court, dated June 27,
1968, dismissing petitioners' petition to adopt the minor, Colin Berry Christensen
Duncan. It seeks to have the findings and conclusions of law contained in -the decision
annulled and revoked and to declare the petition for adoption meritorious and the child
sought to be adopted, the minor Colin Berry Christensen Duncan, declared the child by
adoption and heir of herein petitioners-Appellants. Robin Francis Radley Duncan and
Maria Lucy Christensen. 1

Petitioners Robin Francis Radley Duncan and Maria Lucy Christensen are husband and
wife, the former a British national residing in the Philippines for the last 17 years and the
latter an American citizen born in and a resident of the Philippines. Having no children
of their own but having previously adopted another child, said spouses filed a petition
with respondent court (Sp. Proc. No. 5457) for the adoption of a child previously
baptized and named by them as Colin Berry Christensen Duncan. The petition is filed
and denominated as Sp. Proc. No. 5457.

In the decision rendered by respondent Court dated June 27, 1968, the petition for
adoption was dismissed. 2

The principal reason given for the dismissed al of the petition was that ... the consent
given in this petition Exhibit "J" is improper and falls short of the express requirement of
the law. 3

Rationalizing its action respondent Judge said:

Art. 340 (of the Civil Code) provides that the written consent of the
following to the adoption shall be necessary:

2. The guardian or person in charge of the person to be adopted.

"Under the law aforementioned, it will be noted that the law is couched in mandatory
terms by the word SHALL be necessary, and it enumerates the persons who will give
the consent to the adoption in the order as follows: parents, guardian, or the person in
charge of the person to be adopted.

It is admitted by witness Velasquez that she knew the identity of the

mother who gave her the child. This being the case, the proper person
who is supposed to give the parental consent to the adoption should first
be, in the order of preference, the parent or the mother herself. 4

On the allegation of petitioners that their principal witness, Atty. Corazon de Leon
Velasquez, under whose care the newly-born child was entrusted by the unwedded
mother, could not reveal the identity of the mother because it would violate the
privileged communications between the attorney and client, respondent Judge
explained: "The contention that for her (Atty. Corazon de Leon Velasquez, the witness
for the petitioners who gave the written consent to the adoption of the child in her
capacity as loco parentis to said child) to reveal the identity of the mother would be
violative of the client-attorney relationship existing between her and the mother cannot
hold water, because in the first place, there was no such relationship existing between
them in so far as this case is concerned and secondly, it is not only a question of
revealing the identity of the mother but rather, of giving consent to adoption by that
alleged unwed mother."5

Taking exception to respondent Judge's decision and the ratio decidendi thereof,
appellants-petitioners alleged the following as errors committed by the trial court: 6

1) The inviolability of privileged communication between attorney and

client is only binding upon the attorney in the same case where such
relationship of attorney and client arose when the client imparted the
privileged communication and that elsewhere or in another case the
attorney is not bound to the secrecy;

2) The infant that was given away by the natural mother, even without the
latter providing for the child's maintenance and support, could not be
considered as abandoned;

3) The stranger who received the baby or child, in this case, Atty. Corazon
de Leon Velasquez, could not be considered as the guardian de facto and
in loco parentis of the child, and therefore, is not empowered by law to
give written consent to the adoption;

4) That whenever and as long as the natural mother is known to anybody,

only said natural mother can give the written consent to the adoption;

5) That the term "person in charge of the person to be adopted", one of

those who can give consent to the adoption under Article 340 of the Civil
Code, means or refers to institutions or orphanages established for the
purpose of rearing orphans, foundlings and destitute children.

The facts of this case are few and simple.

a) Sometime in May, 1967, a child, less than a week old (only 3 days old)
7 was given to petitioners Robin Francis Radley Duncan and his wife
Maria Lucy Christensen, for them to adopt, by Atty. Corazon de Leon
Velasquez. The child was later on baptized as Colin Berry Christensen
Duncan with the aforementioned espouses appearing in the records of
said baptism as the parents of said child; 8

b) Atty. Corazon de Leon Velasquez on the other hand, received the infant
from the child's unwed mother who told the former never to reveal her (the
mother's) identity because she wanted to get married and did not want to
destroy her future. The mother instructed Atty. Corazon de Leon
Velasquez to look for a suitable couple who will adopt the child. The
mother did not provide for the maintenance and support of her child; 9
 c) In the petition for adoption filed by petitioners in September, 1967, Atty.
Corazon de Leon Velasquez, as the de facto guardian or loco parentis of
the child subject of the adoption petition, gave the written consent required
by law; 10

d) Learning, from the testimony of witness Atty. Corazon de Leon

Velasquez that the natural mother of the child sought to be adopted was
still alive, the court then pressed upon the witness to reveal the identity of
said mother. The witness refused to divulge the same on the ground that
there existed an attorney and client relationship between them. She had
been instructed by her client not to reveal the latter's identity. She could
not now violate such privilege communication. 11

After examining the facts and the arguments presented, it appears to this Court that
there is only one principal issue involved, i.e., whether or not the person who gave the
consent for adoption, which in this case is Atty. Corazon de Leon Velasquez, is the
proper person required by law to give such consent.

The law applicable is. Art. 340 of the Civil Code, which provides:

Art. 340. The written consent of the following to adoption shall be

necessary:

(1) The person to be adopted, if fourteen years of age or over;

(2) The parents, guardian or person in charge of the person to be adopted.

On the other hand, the Rules of Court (Rule 99) has this to say on those who are
required to give consent in adoption:

Sec. 3. Consent to adoption. — There shall be filed with the petition a

written consent to the adoption signed by the child, if fourteen years of age
or over and not incompetent, and by the child's spouse, if any, and by
each of its known living parents who is not an insane or hopelessly
intemperate or has not abandoned such child, or if there are no such
parents by the general guardian, or guardian ad litem of the child, or if the
child is in the custody of an orphan asylum, children's home, or benevolent
society or person, by the proper officer or officers of such asylum, home,
or society, or by such person; but if the child is illegitimate and has not
been recognized, the consent of its father to the adoption shall not be
required.

Going by the set of facts in this case, only one of two persons particularly described by
law may be considered here as legally capable of giving the required written consent.
They are:

Under Art. 340 of the Civil 'Code, the "parent, guardian or person in charge of the
person to be adopted" while the other one is that mentioned in Section 3, Rule 99 of the
Rules of Court, describing it as each of the known living parents "who has not
abandoned such child." The father's consent here is out of the question as the child is
illegitimate and unrecognized.

Since the person whose written consent to the adoption (Atty: Corazon de Leon
Velasquez) is assailed by the trial court as being unauthorized and had consequently
caused the rejection of the petition, this Tribunal will now look into her alleged authority
or lack thereof to give the controverted consent.

Sometime in May of 1967, the child subject of this adoption petition, undisputedly
declared as only three days old then, was turned over by its mother to witness Atty.
Corazon de Leon Velasquez. The natural and unwedded mother, from that date on to
the time of the adoption proceedings in court which started in mid- year of said 1967,
and up to the present, has not bothered to inquire into the condition of the child, much
less to contribute to the livelihood, maintenance and care of the same. In short, this
parent is the antithesis of that described in the law as "known living parent who is not
insane Or hopelessly intemperate or has not abandoned such child." We are convinced
that in fact said mother had completely and absolutely abandoned her child. This Court
has previously declared that abandonment imports any conduct on the part of the
parent which evinces a settled purpose to forego all parental claims to the child. 12
Applying this legal yardstick, the unidentified mother of the child in this case can be
declared, as she is hereby declared, as having abandoned her child with all legal
consequences attached thereto.

Having declared that the child was an abandoned one by an unknown parent, there
appears to be no more legal need to require the written consent of such parent of the
child to the adoption. As had been said by this Court in the aforecited case of Santos vs.
Aranzanso, the parental consent required by the law in adoption proceedings refers to
parents who have not abandoned their child. 13 The question now is whether or not
Atty. Corazon de Leon Velasquez, the undisputed custodian of the abandoned waif may
be considered as the guardian under Art. 340 or the person standing in loco parentis of
said infant contemplated in Art. 349 of the Civil Code.

It seems to Us that when the 3-day old baby was left to and placed in the hands of Atty.
Corazon de Leon Velasquez, the helpless infant was in dire need of someone who
could give it protection and sustain its delicate and fragile life. Atty. Velasquez was
under no legal compulsion to accept the child and to extend to it the protection and care
it badly needed. Since there had been no showing that the identity of the natural mother
was made known to the trial court or to the herein petitioners, nor had said mother seen
fit to present herself before the court despite the public notice given to the proceedings
as required by law, there clearly appears only one person who could be considered as
the guardian exercising patria potestas over such abandoned child. Since there was no
guardian ad litem appointed by the court and the child not being in the custody of an
orphan asylum, children's home or any benevolent society, there could not have been
anyone other than Atty. Corazon de Leon Velasquez who could, with reason, be called
the guardian of said infant. It was she who had actual. physical custody of the infant and
who, out of compassion and motherly instinct, extended the mantle of protection over
the hapless and helpless infant which otherwise could have suffered a tragic fate, like
being thrown into some garbage heap as had often happened to some unwanted
illegitimate babies. The least this Court could do to recognize and acknowledge her
good Samaritan deed is to extend, as it hereby extends, to her the recognition that she
was a de facto guardian exercising patria potestas over the abandoned child.

The trial court in its decision had sought refuge in the ancient Roman legal maxim "Dura
lex sed lex" to cleanse its hands of the hard and harsh decision it rendered. While this
old adage generally finds apt application in many other legal cases, in adoption of
children, however, this should be softened so as to apply the law with less severity and
with compassion and humane understanding, for adoption is more for the benefit of
unfortunate children, particularly those born out of wedlock, than for those born with a
silver spoon in their mouths. All efforts or acts designed to provide homes, love, care
and education for unfortunate children, who otherwise may grow from cynical street
urchins to hardened criminal offenders and become serious social problems, should be
given the widest attitude of sympathy, encouragement and assistance. The law is not,
and should not be made, an instrument to impede the achievement of a salutary
humane policy. As often as is legally and lawfully possible, their texts and intendments
should be construed so as to give all the chances for human life to exist — with a
modicum promise of a useful and constructive existence.

The herein petitioners, the spouses Robin Francis Radley Duncan and Maria Lucy
Christensen, appear to be qualified to adopt the child. There is no showing that they
suffer from any of the disqualifications under the law. Above all, they have the means to
provide the child with the proper support, care, education and love that a growing child
needs, even if they have previously adopted another child as theirs. The fact that even
before they have applied for legal custody and adoption of the infant they have already
showered it with love and care and had it baptized, with them appearing in the records
of the baptism as the parents of the child, speaks well of the genuine desire of
petitioners to have the child as their very own. The child was born in May, 1967, and he
will be at this time, 1976, about 9 years of age. In all the years, from the time he was
turned over to the herein petitioners when he was only about a week old (there is no
showing that the said child was ever placed at any' time in the care and custody of
some other persons) he had been cared for and loved by the spouses Robin Francis
RadLey Duncan and Maria Lucy Christensen. He must have known no other parents
than these persons. If we are now to sustain the decision of the court below, this
Tribunal will be doing a graver injustice to all concerned particularly to said spouses,
and worse, it will be imposing a cruel sanction on this innocent child and on all other
children who might be similarly situated. We consider it to be justifiable and more
humane to formalize a factual relation, that of parents and son, existing between the
herein petitioning spouses and the minor child baptized by them as Colin Berry
Christensen Duncan, than to sustain the hard, harsh and cruel interpretation of the law
that was done by the respondent court and Judge. It is Our view that it is in consonance
with the true spirit and purpose of the law, and with the policy of the State, to uphold,
encourage and give life and meaning to the existence of family relations.

WHEREFORE, in the light of the foregoing, the decision of the respondent Judge of the
Court of First Instance of Rizal, Branch X, in Sp. Proc. No. 5457, dated June 27, 1968,
is hereby annulled, and We declare that the minor Colin Berry Christensen Duncan is
the adopted child and the heir of petitioners Robin Francis Radley Duncan and Maria
Lucy Christensen.

No costs.
SO ORDERED.

LOCAL GOVERNMENT / LOCAL AUTONOMY

G.R. No. 92299 April 19, 1991

REYNALDO R. SAN JUAN, petitioner,

vs.
CIVIL SERVICE COMMISSION, DEPARTMENT OF BUDGET AND MANAGEMENT
and CECILIA ALMAJOSE, respondents.

Legal Services Division for petitioner.

Sumulong, Sumulong, Paras & Abano Law Offices for private respondent.

GUTIERREZ, JR., J.:

In this petition for certiorari pursuant to Section 7, Article IX (A) of the present Constitution, the
petitioner Governor of the Province of Rizal, prays for the nullification of Resolution No. 89-868
of the Civil Service Commission (CSC) dated November 21, 1989 and its Resolution No. 90-150
dated February 9, 1990.

The dispositive portion of the questioned Resolution reads:

WHEREFORE, foregoing premises considered, the Commission resolved to dismiss, as it

hereby dismisses the appeal of Governor Reynaldo San Juan of Rizal. Accordingly, the
approved appointment of Ms. Cecilia Almajose as Provincial Budget Officer of Rizal, is
upheld. (Rollo, p. 32)

The subsequent Resolution No. 90-150 reiterates CSC's position upholding the private
respondent's appointment by denying the petitioner's motion for reconsideration for lack of merit.

The antecedent facts of the case are as follows:

On March 22, 1988, the position of Provincial Budget Officer (PBO) for the province of Rizal
was left vacant by its former holder, a certain Henedima del Rosario.

In a letter dated April 18, 1988, the petitioner informed Director Reynaldo Abella of the
Department of Budget and Management (DBM) Region IV that Ms. Dalisay Santos assumed
office as Acting PBO since March 22, 1988 pursuant to a Memorandum issued by the petitioner
who further requested Director Abella to endorse the appointment of the said Ms. Dalisay Santos
to the contested position of PBO of Rizal. Ms. Dalisay Santos was then Municipal Budget
Officer of Taytay, Rizal before she discharged the functions of acting PBO.

In a Memorandum dated July 26, 1988 addressed to the DBM Secretary, then Director Abella of
Region IV recommended the appointment of the private respondent as PBO of Rizal on the basis
of a comparative study of all Municipal Budget Officers of the said province which included
three nominees of the petitioner. According to Abella, the private respondent was the most
qualified since she was the only Certified Public Accountant among the contenders.

On August 1, 1988, DBM Undersecretary Nazario S. Cabuquit, Jr. signed the appointment
papers of the private respondent as PBO of Rizal upon the aforestated recommendation of
Abella.

In a letter dated August 3, 1988 addressed to Secretary Carague, the petitioner reiterated his
request for the appointment of Dalisay Santos to the contested position unaware of the earlier
appointment made by Undersecretary Cabuquit.

On August 31, 1988, DBM Regional Director Agripino G. Galvez wrote the petitioner that
Dalisay Santos and his other recommendees did not meet the minimum requirements under
Local Budget Circular No. 31 for the position of a local budget officer. Director Galvez whether
or not through oversight further required the petitioner to submit at least three other qualified
nominees who are qualified for the position of PBO of Rizal for evaluation and processing.

On November 2, 1988, the petitioner after having been informed of the private respondent's
appointment wrote Secretary Carague protesting against the said appointment on the grounds that
Cabuquit as DBM Undersecretary is not legally authorized to appoint the PBO; that the private
respondent lacks the required three years work experience as provided in Local Budget Circular
No. 31; and that under Executive Order No. 112, it is the Provincial Governor, not the Regional
Director or a Congressman, who has the power to recommend nominees for the position of PBO.

On January 9, 1989 respondent DBM, through its Director of the Bureau of Legal & Legislative
Affairs (BLLA) Virgilio A. Afurung, issued a Memorandum ruling that the petitioner's letter-
protest is not meritorious considering that public respondent DBM validly exercised its
prerogative in filling-up the contested position since none of the petitioner's nominees met the
prescribed requirements.

On January 27, 1989, the petitioner moved for a reconsideration of the BLLA ruling.

On February 28, 1989, the DBM Secretary denied the petitioner's motion for reconsideration.

On March 27, 1989, the petitioner wrote public respondent CSC protesting against the
appointment of the private respondent and reiterating his position regarding the matter.

Subsequently, public respondent CSC issued the questioned resolutions which prompted the
petitioner to submit before us the following assignment of errors:

A. THE CSC ERRED IN UPHOLDING THE APPOINTMENT BY DBM ASSISTANT

SECRETARY CABUQUIT OF CECILIA ALMAJOSE AS PBO OF RIZAL.

B. THE CSC ERRED IN HOLDING THAT CECILIA ALMA JOSE POSSESSES ALL
THE REQUIRED QUALIFICATIONS.

C. THE CSC ERRED IN DECLARING THAT PETITIONER'S NOMINEES ARE NOT

QUALIFIED TO THE SUBJECT POSITION.
 D. THE CSC AND THE DBM GRAVELY ABUSED THEIR DISCRETION IN NOT
ALLOWING PETITIONER TO SUBMIT NEW NOMINEES WHO COULD MEET
THE REQUIRED QUALIFICATION (Petition, pp. 7-8, Rollo, pp. 15-16)

All the assigned errors relate to the issue of whether or not the private respondent is lawfully
entitled to discharge the functions of PBO of Rizal pursuant to the appointment made by public
respondent DBM's Undersecretary upon the recommendation of then Director Abella of DBM
Region IV.

The petitioner's arguments rest on his contention that he has the sole right and privilege to
recommend the nominees to the position of PBO and that the appointee should come only from
his nominees. In support thereof, he invokes Section 1 of Executive Order No. 112 which
provides that:

Sec. 1. All budget officers of provinces, cities and municipalities shall be appointed
henceforth by the Minister of Budget and Management upon recommendation of the local
chief executive concerned, subject to civil service law, rules and regulations, and they
shall be placed under the administrative control and technical supervision of the Ministry
of Budget and Management.

The petitioner maintains that the appointment of the private respondent to the contested position
was made in derogation of the provision so that both the public respondents committed grave
abuse of discretion in upholding Almajose's appointment.

There is no question that under Section 1 of Executive Order No. 112 the petitioner's power to
recommend is subject to the qualifications prescribed by existing laws for the position of PBO.
Consequently, in the event that the recommendations made by the petitioner fall short of the
required standards, the appointing authority, the Minister (now Secretary) of public respondent
DBM is expected to reject the same.

In the event that the Governor recommends an unqualified person, is the Department Head free
to appoint anyone he fancies ? This is the issue before us.

Before the promulgation of Executive Order No. 112 on December 24, 1986, Batas Pambansa
Blg. 337, otherwise known as the Local Government Code vested upon the Governor, subject to
civil service rules and regulations, the power to appoint the PBO (Sec. 216, subparagraph (1), BP
337). The Code further enumerated the qualifications for the position of PBO. Thus, Section 216,
subparagraph (2) of the same code states that:

(2) No person shall be appointed provincial budget officer unless he is a citizen of the
Philippines, of good moral character, a holder of a degree preferably in law, commerce,
public administration or any related course from a recognized college or university, a first
grade civil service eligibility or its equivalent, and has acquired at least five years
experience in budgeting or in any related field.

The petitioner contends that since the appointing authority with respect to the Provincial Budget
Officer of Rizal was vested in him before, then, the real intent behind Executive Order No. 112
in empowering him to recommend nominees to the position of Provincial Budget Officer is to
make his recommendation part and parcel of the appointment process. He states that the phrase
"upon recommendation of the local chief executive concerned" must be given mandatory
application in consonance with the state policy of local autonomy as guaranteed by the 1987
Constitution under Art. II, Sec. 25 and Art. X, Sec. 2 thereof. He further argues that his power to
recommend cannot validly be defeated by a mere administrative issuance of public respondent
DBM reserving to itself the right to fill-up any existing vacancy in case the petitioner's nominees
do not meet the qualification requirements as embodied in public respondent DBM's Local
Budget Circular No. 31 dated February 9, 1988.

The questioned ruling is justified by the public respondent CSC as follows:

As required by said E.O. No. 112, the DBM Secretary may choose from among the
recommendees of the Provincial Governor who are thus qualified and eligible for
appointment to the position of the PBO of Rizal. Notwithstanding, the recommendation
of the local chief executive is merely directory and not a condition sine qua non to the
exercise by the Secretary of DBM of his appointing prerogative. To rule otherwise would
in effect give the law or E.O. No. 112 a different interpretation or construction not
intended therein, taking into consideration that said officer has been nationalized and is
directly under the control and supervision of the DBM Secretary or through his duly
authorized representative. It cannot be gainsaid that said national officer has a similar role
in the local government unit, only on another area or concern, to that of a Commission on
Audit resident auditor. Hence, to preserve and maintain the independence of said officer
from the local government unit, he must be primarily the choice of the national
appointing official, and the exercise thereof must not be unduly hampered or interfered
with, provided the appointee finally selected meets the requirements for the position in
accordance with prescribed Civil Service Law, Rules and Regulations. In other words,
the appointing official is not restricted or circumscribed to the list submitted or
recommended by the local chief executive in the final selection of an appointee for the
position. He may consider other nominees for the position vis a vis the nominees of the
local chief executive. (CSC Resolution No. 89-868, p. 2; Rollo, p. 31)

The issue before the Court is not limited to the validity of the appointment of one Provincial
Budget Officer. The tug of war between the Secretary of Budget and Management and the
Governor of the premier province of Rizal over a seemingly innocuous position involves the
application of a most important constitutional policy and principle, that of local autonomy. We
have to obey the clear mandate on local autonomy. Where a law is capable of two interpretations,
one in favor of centralized power in Malacañang and the other beneficial to local autonomy, the
scales must be weighed in favor of autonomy.

The exercise by local governments of meaningful power has been a national goal since the turn
of the century. And yet, inspite of constitutional provisions and, as in this case, legislation
mandating greater autonomy for local officials, national officers cannot seem to let go of
centralized powers. They deny or water down what little grants of autonomy have so far been
given to municipal corporations.

President McKinley's Instructions dated April 7, 1900 to the Second Philippine Commission
ordered the new Government "to devote their attention in the first instance to the establishment
of municipal governments in which natives of the Islands, both in the cities and rural
communities, shall be afforded the opportunity to manage their own local officers to the fullest
extent of which they are capable and subject to the least degree of supervision and control which
a careful study of their capacities and observation of the workings of native control show to be
consistent with the maintenance of law, order and loyalty.
In this initial organic act for the Philippines, the Commission which combined both executive
and legislative powers was directed to give top priority to making local autonomy effective.

The 1935 Constitution had no specific article on local autonomy. However, in distinguishing
between presidential control and supervision as follows:

The President shall have control of all the executive departments, bureaus, or offices,
exercise general supervision over all local governments as may be provided by law, and
take care that the laws be faithfully executed. (Sec. 11, Article VII, 1935 Constitution)

the Constitution clearly limited the executive power over local governments to "general
supervision . . . as may be provided by law." The President controls the executive departments.
He has no such power over local governments. He has only supervision and that supervision is
both general and circumscribed by statute.

In Tecson v. Salas, 34 SCRA 275, 282 (1970), this Court stated:

. . . Hebron v. Reyes, (104 Phil. 175 [1958]) with the then Justice, now Chief Justice,
Concepcion as the ponente, clarified matters. As was pointed out, the presidential
competence is not even supervision in general, but general supervision as may be
provided by law. He could not thus go beyond the applicable statutory provisions, which
bind and fetter his discretion on the matter. Moreover, as had been earlier ruled in an
opinion penned by Justice Padilla in Mondano V. Silvosa, (97 Phil. 143 [1955]) referred
to by the present Chief Justice in his opinion in the Hebron case, supervision goes no
further than "overseeing or the power or authority of an officer to see that subordinate
officers perform their duties. If the latter fail or neglect to fulfill them the former may
take such action or step as prescribed by law to make them perform their duties." (Ibid,
pp. 147-148) Control, on the other hand, "means the power of an officer to alter or
modify or nullify or set aside what a subordinate had done in the performance of their
duties and to substitute the judgment of the former for that of the latter." It would follow
then, according to the present Chief Justice, to go back to the Hebron opinion, that the
President had to abide by the then provisions of the Revised Administrative Code on
suspension and removal of municipal officials, there being no power of control that he
could rightfully exercise, the law clearly specifying the procedure by which such
disciplinary action would be taken.

Pursuant to this principle under the 1935 Constitution, legislation implementing local autonomy
was enacted. In 1959, Republic Act No. 2264, "An Act Amending the Law Governing Local
Governments by Increasing Their Autonomy and Reorganizing Local Governments" was passed.
It was followed in 1967 when Republic Act No. 5185, the Decentralization Law was enacted,
giving "further autonomous powers to local governments governments."

The provisions of the 1973 Constitution moved the country further, at least insofar as legal
provisions are concerned, towards greater autonomy. It provided under Article II as a basic
principle of government:

Sec. 10. The State shall guarantee and promote the autonomy of local government units,
especially the barangay to ensure their fullest development as self-reliant communities.
An entire article on Local Government was incorporated into the Constitution. It called for a
local government code defining more responsive and accountable local government structures.
Any creation, merger, abolition, or substantial boundary alteration cannot be done except in
accordance with the local government code and upon approval by a plebiscite. The power to
create sources of revenue and to levy taxes was specifically settled upon local governments.

The exercise of greater local autonomy is even more marked in the present Constitution.

Article II, Section 25 on State Policies provides:

Sec. 25. The State shall ensure the autonomy of local governments

The 14 sections in Article X on Local Government not only reiterate earlier doctrines but give in
greater detail the provisions making local autonomy more meaningful. Thus, Sections 2 and 3 of
Article X provide:

Sec. 2. The territorial and political subdivisions shall enjoy local autonomy.

Sec. 3. The Congress shall enact a local government code which shall provide for a more
responsive and accountable local government structure instituted through a system of
decentralization with effective mechanisms of recall, initiative, and referendum, allocate
among the different local government units their powers, responsibilities, and resources,
and provide for the qualifications, election, appointment and removal, term, salaries,
powers and functions and duties of local officials, and all other matters relating to the
organization and operation of the local units.

When the Civil Service Commission interpreted the recommending power of the Provincial
Governor as purely directory, it went against the letter and spirit of the constitutional provisions
on local autonomy. If the DBM Secretary jealously hoards the entirety of budgetary powers and
ignores the right of local governments to develop self-reliance and resoluteness in the handling
of their own funds, the goal of meaningful local autonomy is frustrated and set back.

The right given by Local Budget Circular No. 31 which states:

Sec. 6.0 — The DBM reserves the right to fill up any existing vacancy where none of the
nominees of the local chief executive meet the prescribed requirements.

is ultra vires and is, accordingly, set aside. The DBM may appoint only from the list of qualified
recommendees nominated by the Governor. If none is qualified, he must return the list of
nominees to the Governor explaining why no one meets the legal requirements and ask for new
recommendees who have the necessary eligibilities and qualifications.

The PBO is expected to synchronize his work with DBM. More important, however, is the
proper administration of fiscal affairs at the local level. Provincial and municipal budgets are
prepared at the local level and after completion are forwarded to the national officials for review.
They are prepared by the local officials who must work within the constraints of those budgets.
They are not formulated in the inner sanctums of an all-knowing DBM and unilaterally imposed
on local governments whether or not they are relevant to local needs and resources. It is for this
reason that there should be a genuine interplay, a balancing of viewpoints, and a harmonization
of proposals from both the local and national officials. It is for this reason that the nomination
and appointment process involves a sharing of power between the two levels of government.

It may not be amiss to give by way of analogy the procedure followed in the appointments of
Justices and Judges.1âwphi1 Under Article VIII of the Constitution, nominations for judicial
positions are made by the Judicial and Bar Council. The President makes the appointments from
the list of nominees submitted to her by the Council. She cannot apply the DBM procedure,
reject all the Council nominees, and appoint another person whom she feels is better qualified.
There can be no reservation of the right to fill up a position with a person of the appointing
power's personal choice.

The public respondent's grave abuse of discretion is aggravated by the fact that Director Galvez
required the Provincial Governor to submit at least three other names of nominees better
qualified than his earlier recommendation. It was a meaningless exercise. The appointment of the
private respondent was formalized before the Governor was extended the courtesy of being
informed that his nominee had been rejected. The complete disregard of the local government's
prerogative and the smug belief that the DBM has absolute wisdom, authority, and discretion are
manifest.

In his classic work "Philippine Political Law" Dean Vicente G. Sinco stated that the value of
local governments as institutions of democracy is measured by the degree of autonomy that they
enjoy. Citing Tocqueville, he stated that "local assemblies of citizens constitute the strength of
free nations. . . . A people may establish a system of free government but without the spirit of
municipal institutions, it cannot have the spirit of liberty." (Sinco, Philippine Political Law,
Eleventh Edition, pp. 705-706).

Our national officials should not only comply with the constitutional provisions on local
autonomy but should also appreciate the spirit of liberty upon which these provisions are based.

WHEREFORE, the petition is hereby GRANTED. The questioned resolutions of the Civil
Service Commission are SET ASIDE. The appointment of respondent Cecilia Almajose is
nullified. The Department of Budget and Management is ordered to appoint the Provincial
Budget Officer of Rizal from among qualified nominees submitted by the Provincial Governor.

SO ORDERED.

WILLS
G.R. No. 106720 September 15, 1994

SPOUSES ROBERTO AND THELMA AJERO, petitioners,

vs.
THE COURT OF APPEALS AND CLEMENTE SAND, respondents.

Miguel D. Larida for petitioners.

Montilla Law Office for private respondent.

PUNO, J.:

This is an appeal by certiorari from the Decision of the Court of

Appeals 1 in CA-G.R. CV No. 22840, dated March 30, 1992, the dispositive portion of which reads;

PREMISES CONSIDERED, the questioned decision of November 19, 1988 of the trial court is hereby REVERSED and
SET ASIDE, and the petition for probate is hereby DISMISSED. No costs.

The earlier Decision was rendered by the RTC of Quezon City, Branch 94, 2 in Sp. Proc. No. Q-37171, and the instrument
submitted for probate is the holographic will of the late Annie Sand, who died on November 25, 1982.

In the will, decedent named as devisees, the following: petitioners Roberto and Thelma Ajero, private respondent Clemente Sand, Meriam S.
Arong, Leah Sand, Lilia Sand, Edgar Sand, Fe Sand, Lisa S. Sand, and Dr. Jose Ajero, Sr., and their children.

On January 20, 1983, petitioners instituted Sp. Proc. No. Q-37171, for allowance of decedent's holographic will. They alleged that at the time
of its execution, she was of sound and disposing mind, not acting under duress, fraud or undue influence, and was in every respect
capacitated to dispose of her estate by will.

Private respondent opposed the petition on the grounds that: neither the testament's body nor the signature therein was in decedent's
handwriting; it contained alterations and corrections which were not duly signed by decedent; and, the will was procured by petitioners
through improper pressure and undue influence. The petition was likewise opposed by Dr. Jose Ajero. He contested the disposition in the will
of a house and lot located in Cabadbaran, Agusan Del Norte. He claimed that said property could not be conveyed by decedent in its
entirety, as she was not its sole owner.

Notwithstanding the oppositions, the trial court admitted the decedent's holographic will to probate. It found, inter alia:

Considering then that the probate proceedings herein must decide only the question of identity of the will, its due
execution and the testamentary capacity of the testatrix, this probate court finds no reason at all for the disallowance of
the will for its failure to comply with the formalities prescribed by law nor for lack of testamentary capacity of the
testatrix.

For one, no evidence was presented to show that the will in question is different from the will actually executed by the
testatrix. The only objections raised by the oppositors . . . are that the will was not written in the handwriting of the
testatrix which properly refers to the question of its due execution, and not to the question of identity of will. No other
will was alleged to have been executed by the testatrix other than the will herein presented. Hence, in the light of the
evidence adduced, the identity of the will presented for probate must be accepted, i.e., the will submitted in Court must
be deemed to be the will actually executed by the testatrix.

xxx xxx xxx

While the fact that it was entirely written, dated and signed in the handwriting of the testatrix has been disputed, the
petitioners, however, have satisfactorily shown in Court that the holographic will in question was indeed written entirely,
dated and signed in the handwriting of the testatrix. Three (3) witnesses who have convincingly shown knowledge of
the handwriting of the testatrix have been presented and have explicitly and categorically identified the handwriting with
which the holographic will in question was written to be the genuine handwriting and signature of the testatrix. Given
then the aforesaid evidence, the requirement of the law that the holographic will be entirely written, dated and signed in
the handwriting of the testatrix has been complied with.

xxx xxx xxx

As to the question of the testamentary capacity of the testratix, (private respondent) Clemente Sand himself has
testified in Court that the testatrix was completely in her sound mind when he visited her during her birthday celebration
in 1981, at or around which time the holographic will in question was executed by the testatrix. To be of sound mind, it
is sufficient that the testatrix, at the time of making the will, knew the value of the estate to be disposed of, the proper
object of her bounty, and the character of the testamentary act . . . The will itself shows that the testatrix even had
detailed knowledge of the nature of her estate. She even identified the lot number and square meters of the lots she
had conveyed by will. The objects of her bounty were likewise identified explicitly. And considering that she had even
written a nursing book which contained the law and jurisprudence on will and succession, there is more than sufficient
showing that she knows the character of the testamentary act.

In this wise, the question of identity of the will, its due execution and the testamentary capacity of the testatrix has to be
resolved in favor of the allowance of probate of the will submitted herein.

Likewise, no evidence was presented to show sufficient reason for the disallowance of herein holographic will. While it
was alleged that the said will was procured by undue and improper pressure and influence on the part of the
beneficiary or of some other person, the evidence adduced have not shown any instance where improper pressure or
influence was exerted on the testatrix. (Private respondent) Clemente Sand has testified that the testatrix was still alert
at the time of the execution of the will, i.e., at or around the time of her birth anniversary celebration in 1981. It was also
 established that she is a very intelligent person and has a mind of her own. Her independence of character and to
some extent, her sense of superiority, which has been testified to in Court, all show the unlikelihood of her being unduly
influenced or improperly pressured to make the aforesaid will. It must be noted that the undue influence or improper
pressure in question herein only refer to the making of a will and not as to the specific testamentary provisions therein
which is the proper subject of another proceeding. Hence, under the circumstances, this Court cannot find convincing
reason for the disallowance of the will herein.

Considering then that it is a well-established doctrine in the law on succession that in case of doubt, testate succession
should be preferred over intestate succession, and the fact that no convincing grounds were presented and proven for
the disallowance of the holographic will of the late Annie Sand, the aforesaid will submitted herein must be admitted to
probate. 3 (Citations omitted.)

On appeal, said Decision was reversed, and the petition for probate of decedent's will was dismissed. The Court of Appeals found that, "the
holographic will fails to meet the requirements for its validity." 4 It held that the decedent did not comply with Articles 813 and 814 of the New
Civil Code, which read, as follows:

Art. 813: When a number of dispositions appearing in a holographic will are signed without being dated, and the last
disposition has a signature and date, such date validates the dispositions preceding it, whatever be the time of prior
dispositions.

Art. 814: In case of insertion, cancellation, erasure or alteration in a holographic will, the testator must authenticate the
same by his full signature.

It alluded to certain dispositions in the will which were either unsigned and undated, or signed but not dated. It also found that the erasures,
alterations and cancellations made thereon had not been authenticated by decedent.

Thus, this appeal which is impressed with merit.

Section 9, Rule 76 of the Rules of Court provides that will shall be disallowed in any of the following cases:

(a) If not executed and attested as required by law;

(b) If the testator was insane, or otherwise mentally incapable to make a will, at the time of its execution;

(c) If it was executed under duress, or the influence of fear, or threats;

(d) If it was procured by undue and improper pressure and influence, on the part of the beneficiary, or of some other
person for his benefit;

(e) If the signature of the testator was procured by fraud or trick, and he did not intend that the instrument should be his
will at the time of fixing his signature thereto.

In the same vein, Article 839 of the New Civil Code reads:

Art. 839: The will shall be disallowed in any of the following cases;

(1) If the formalities required by law have not been complied with;

(2) If the testator was insane, or otherwise mentally incapable of making a will, at the time of its
execution;

(3) If it was executed through force or under duress, or the influence of fear, or threats;

(4) If it was procured by undue and improper pressure and influence, on the part of the
beneficiary or of some other person;

(5) If the signature of the testator was procured by fraud;

(6) If the testator acted by mistake or did not intend that the instrument he signed should be his
will at the time of affixing his signature thereto.

These lists are exclusive; no other grounds can serve to disallow a will. 5 Thus, in a petition to admit a holographic will to probate, the only
issues to be resolved are: (1) whether the instrument submitted is, indeed, the decedent's last will and testament; (2) whether said will was
executed in accordance with the formalities prescribed by law; (3) whether the decedent had the necessary testamentary capacity at the time
the will was executed; and, (4) whether the execution of the will and its signing were the voluntary acts of the decedent. 6
In the case at bench, respondent court held that the holographic will of Anne Sand was not executed in accordance with the formalities
prescribed by law. It held that Articles 813 and 814 of the New Civil Code, ante, were not complied with, hence, it disallowed the probate of
said will. This is erroneous.

We reiterate what we held in Abangan vs. Abangan, 40 Phil. 476, 479 (1919), that:

The object of the solemnities surrounding the execution of wills is to close the door against bad faith and fraud, to avoid
substitution of wills and testaments and to guaranty their truth and authenticity. Therefore, the laws on this subject
should be interpreted in such a way as to attain these primordial ends. But, on the other hand, also one must not lose
sight of the fact that it is not the object of the law to restrain and curtail the exercise of the right to make a will. So when
an interpretation already given assures such ends, any other interpretation whatsoever, that adds nothing but demands
more requisites entirely unnecessary, useless and frustrative of the testator's last will, must be disregarded.

For purposes of probating non-holographic wills, these formal solemnities include the subscription, attestation, and acknowledgment
requirements under Articles 805 and 806 of the New Civil Code.

In the case of holographic wills, on the other hand, what assures authenticity is the requirement that they be totally autographic or
handwritten by the testator himself, 7 as provided under Article 810 of the New Civil Code, thus:

A person may execute a holographic will which must be entirely written, dated, and signed by the hand of the testator
himself. It is subject to no other form, and may be made in or out of the Philippines, and need not be witnessed.
(Emphasis supplied.)

Failure to strictly observe other formalities will not result in the disallowance of a holographic will that is unquestionably
handwritten by the testator.

A reading of Article 813 of the New Civil Code shows that its requirement affects the validity of the dispositions contained in the holographic
will, but not its probate. If the testator fails to sign and date some of the dispositions, the result is that these dispositions cannot be
effectuated. Such failure, however, does not render the whole testament void.

Likewise, a holographic will can still be admitted to probate, notwithstanding non-compliance with the provisions of Article 814. In the case of
Kalaw vs. Relova 132 SCRA 237 242 (1984), this Court held:

Ordinarily, when a number of erasures, corrections, and interlineations made by the testator in a holographic Will have
not been noted under his signature, . . . the Will is not thereby invalidated as a whole, but at most only as respects the
particular words erased, corrected or interlined. Manresa gave an identical commentary when he said "la omission de
la salvedad no anula el testamento, segun la regla de jurisprudencia establecida en la sentencia de 4 de Abril de
1985." 8 (Citations omitted.)

Thus, unless the unauthenticated alterations, cancellations or insertions were made on the date of the holographic will or on testator's
signature, 9 their presence does not invalidate the will itself. 10 The lack of authentication will only result in disallowance of such changes.

It is also proper to note that the requirements of authentication of changes and signing and dating of dispositions appear in provisions
(Articles 813 and 814) separate from that which provides for the necessary conditions for the validity of the holographic will (Article 810). The
distinction can be traced to Articles 678 and 688 of the Spanish Civil Code, from which the present provisions covering holographic wills are
taken. They read as follows:

Art. 678: A will is called holographic when the testator writes it himself in the form and with the requisites required in
Article 688.

Art. 688: Holographic wills may be executed only by persons of full age.

In order that the will be valid it must be drawn on stamped paper corresponding to the year of its execution, written in
its entirety by the testator and signed by him, and must contain a statement of the year, month and day of its execution.

If it should contain any erased, corrected, or interlined words, the testator must identify them over his signature.

Foreigners may execute holographic wills in their own language.

This separation and distinction adds support to the interpretation that only the requirements of Article 810 of the New Civil Code — and not
those found in Articles 813 and 814 of the same Code — are essential to the probate of a holographic will.

The Court of Appeals further held that decedent Annie Sand could not validly dispose of the house and lot located in Cabadbaran, Agusan
del Norte, in its entirety. This is correct and must be affirmed.

As a general rule, courts in probate proceedings are limited to pass only upon the extrinsic validity of the will sought to be probated.
However, in exceptional instances, courts are not powerless to do what the situation constrains them to do, and pass upon certain provisions
of the will. 11 In the case at bench, decedent herself indubitably stated in her holographic will that the Cabadbaran property is in the name of
her late father, John H. Sand (which led oppositor Dr. Jose Ajero to question her conveyance of the same in its entirety). Thus, as correctly
held by respondent court, she cannot validly dispose of the whole property, which she shares with her father's other heirs.

IN VIEW WHEREOF, the instant petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. CV No. 22840, dated March 30,
1992, is REVERSED and SET ASIDE, except with respect to the invalidity of the disposition of the entire house and lot in Cabadbaran,
Agusan del Norte. The Decision of the Regional Trial Court of Quezon City, Branch 94 in Sp. Proc. No. Q-37171, dated November 19, 1988,
admitting to probate the holographic will of decedent Annie Sand, is hereby REINSTATED, with the above qualification as regards the
Cabadbaran property. No costs.

SO ORDERED.

G.R. No. L-13431 November 12, 1919

In re will of Ana Abangan.

GERTRUDIS ABANGAN, executrix-appellee,
vs.
ANASTACIA ABANGAN, ET AL., opponents-appellants.

Filemon Sotto for appellants.

M. Jesus Cuenco for appellee.

AVANCEÑA, J.:

On September 19, 1917, the Court of First Instance of Cebu admitted to probate Ana Abangan's
will executed July, 1916. From this decision the opponent's appealed.

Said document, duly probated as Ana Abangan's will, consists of two sheets, the first of which
contains all of the disposition of the testatrix, duly signed at the bottom by Martin Montalban (in
the name and under the direction of the testatrix) and by three witnesses. The following sheet
contains only the attestation clause duly signed at the bottom by the three instrumental witnesses.
Neither of these sheets is signed on the left margin by the testatrix and the three witnesses, nor
numbered by letters; and these omissions, according to appellants' contention, are defects
whereby the probate of the will should have been denied. We are of the opinion that the will was
duly admitted to probate.

In requiring that each and every sheet of the will should also be signed on the left margin by the
testator and three witnesses in the presence of each other, Act No. 2645 (which is the one
applicable in the case) evidently has for its object (referring to the body of the will itself) to
avoid the substitution of any of said sheets, thereby changing the testator's dispositions. But
when these dispositions are wholly written on only one sheet signed at the bottom by the testator
and three witnesses (as the instant case), their signatures on the left margin of said sheet would
be completely purposeless. In requiring this signature on the margin, the statute took into
consideration, undoubtedly, the case of a will written on several sheets and must have referred to
the sheets which the testator and the witnesses do not have to sign at the bottom. A different
interpretation would assume that the statute requires that this sheet, already signed at the bottom,
be signed twice. We cannot attribute to the statute such an intention. As these signatures must be
written by the testator and the witnesses in the presence of each other, it appears that, if the
signatures at the bottom of the sheet guaranties its authenticity, another signature on its left
margin would be unneccessary; and if they do not guaranty, same signatures, affixed on another
part of same sheet, would add nothing. We cannot assume that the statute regards of such
importance the place where the testator and the witnesses must sign on the sheet that it would
consider that their signatures written on the bottom do not guaranty the authenticity of the sheet
but, if repeated on the margin, give sufficient security.

In requiring that each and every page of a will must be numbered correlatively in letters placed
on the upper part of the sheet, it is likewise clear that the object of Act No. 2645 is to know
whether any sheet of the will has been removed. But, when all the dispositive parts of a will are
written on one sheet only, the object of the statute disappears because the removal of this single
sheet, although unnumbered, cannot be hidden.

What has been said is also applicable to the attestation clause. Wherefore, without considering
whether or not this clause is an essential part of the will, we hold that in the one accompanying
the will in question, the signatures of the testatrix and of the three witnesses on the margin and
the numbering of the pages of the sheet are formalities not required by the statute. Moreover,
referring specially to the signature of the testatrix, we can add that same is not necessary in the
attestation clause because this, as its name implies, appertains only to the witnesses and not to
the testator since the latter does not attest, but executes, the will.

Synthesizing our opinion, we hold that in a will consisting of two sheets the first of which
contains all the testamentary dispositions and is signed at the bottom by the testator and three
witnesses and the second contains only the attestation clause and is signed also at the bottom by
the three witnesses, it is not necessary that both sheets be further signed on their margins by the
testator and the witnesses, or be paged.

The object of the solemnities surrounding the execution of wills is to close the door against bad
faith and fraud, to avoid substitution of wills and testaments and to guaranty their truth and
authenticity. Therefore the laws on this subject should be interpreted in such a way as to attain
these primordal ends. But, on the other hand, also one must not lose sight of the fact that it is not
the object of the law to restrain and curtail the exercise of the right to make a will. So when an
interpretation already given assures such ends, any other interpretation whatsoever, that adds
nothing but demands more requisites entirely unnecessary, useless and frustative of the testator's
last will, must be disregarded. lawphil.net

As another ground for this appeal, it is alleged the records do not show that the testarix knew the
dialect in which the will is written. But the circumstance appearing in the will itself that same
was executed in the city of Cebu and in the dialect of this locality where the testatrix was a
neighbor is enough, in the absence of any proof to the contrary, to presume that she knew this
dialect in which this will is written.

For the foregoing considerations, the judgment appealed from is hereby affirmed with costs
against the appellants. So ordered.
NATURALIZATION
G.R. No. L-13139 May 24, 1961

IN THE MATTER OF THE PETITION OF TAN CHU KENG TO BE ADMITTED AS A

CITIZEN OF THE PHILIPPINES. TAN CHU KENG petitioner-appellee,
vs.
REPUBLIC OF THE PHILIPPINES, oppositor-appellant.

Jesus P. Narvios and Cesar A. Kintanar for petitioner-appellee.

Office of the Solicitor General for oppositor-appellant.

PAREDES, J.:

This is an appeal by the Republic of the Philippines from the decision of the Court of First
Instance of Cebu, granting Tan Chu Keng Philippine citizenship.

On September 15, 1955, Tan Chu Keng filed a petition for naturalization, with the Court of First
Instance of Cebu, alleging that he emigrated to the Philippines from Amoy, China, in or about
July 1912, arriving in the islands on board the boat Susana; that he is married to Lu Lay Tee, also
a Chinese, born in Amoy, China, who came to the Philippines in 1932; that he has three (3)
children with his wife Lu Lay Tee, namely, Domingo Tan, Esperanza Tan and Bienvenido Tan,
all born in Cebu, on January 28, 1940, September 30, 1942 and April 22, 1945, respectively; that
his children are now studying in the Cebu Institute, a school duly recognized by the government
where Philippine history, civics and Philippine government are taught and which school is open
to children of all races; that he is a merchant, having a sari-sari store and deals in lumber, copra
and corn meal business; that he has no tax liabilities; knows the principles underlying the
Philippine Constitution can speak and write English, Spanish and the Cebu-Visayan dialect.
Petitioner claimed that he is entitled to the benefits of Commonwealth Act No. 535, which
exempts any person who has resided in the Philippines for a period of thirty (30) years from
filing a declaration of intention — to become a citizen. The affidavits of two character
eyewitnesses, Dr. Hospicio B. Iballe City School Dentist of Cebu City, who claimed to have
known petitioner since childhood, and Atty. Antonio T. Paulin who lived a stone throw from
petitioner's house, vouching for his good moral character and irreproachable conduct, were also
presented. Both witnesses are compadres of petitioner.

In the course of the proceedings, the provincial fiscal, on cross examination was able to elicit
facts which were not contained in the petition, such as: that petitioner before he married his
present wife, was married in China sometime in 1923; that his first wife died in 1925, leaving a
son Espiritu Tan, who was living at C. Padilla street, Cebu City, at the time; that Espiritu studied
at the Silliman University and reached the 2nd year high school; that he (Espiritu) was already 35
years old at the time of the hearing; that he did not include Espiritu in the enumeration of his
children in the petition because he was already of age. On redirect, petitioner explained that
Espiritu did not finish his studies because of the outbreak of the last war and of his marriage
after.
After the hearing, the provincial fiscal requested for fifteen (15) days within which to file a
memorandum. Before the expiration of the period, however, counsel for the petitioner filed a
motion for the re-opening of the case to present additional evidence, since he (petitioner) failed
to introduce "important material and relevant facts, through excusable negligence and mistake."
At the reopening, petitioner testified that aside from the three (3) children he mentioned in his
petition, he had two (2) others, namely, Espiritu Tan and Alfonso Tan, who were born in Amoy,
China, on February 17, 1924 and January 8, 1933, respectively; that when Espiritu was under the
custody of petitioner, he attended the Cebu Little Flower School, the Silliman University and the
Balamban Institute that in 1937 to 1938, Espiritu was classified as a third grader and a fifth
grader in 1939 to 1940; that Alfonso studied in the Balamban Public School from Grade I to IV.
Atty. Narvios, counsel for the petitioner, testified that at the preparation of the petition, he
discovered that Espiritu and Alfonso were already 31 and 21 years old and both married in 1953
and 1955, respectively; that he believed there was no necessity to include their names in the
petition, considering that under section 15 of Act 473, only minor children are affected by the
naturalization of the father.

It was also brought out at the said hearing that on February 25, 1942, petitioner filed a petition
for naturalization in the CFI of Cebu, in which petition he included the names of the two children
(Espiritu and Alfonso), who were then minors; but that said petition was dismissed for his failure
to appear during the hearing, due to illness.

The lower court on June 8, 1957, rendered the following judgment:

WHEREFORE, the petition to be admitted as a citizen of the Philippines of petitioner

TAN CHU KENG is granted and the Court hereby decrees the naturalization of the said
petitioner as a citizen of the Philippines.

The Solicitor General alleged in his appeal brief that the lower court erred in holding that: (1) the
omission in the petition of the names of two of petitioner's children who were 31 and 22 years
old, respectively, at the time of the filing of the petition, is not sufficient ground for dismissing
the petition; (2) the omission of the names of Espiritu Tan and Alfonso Tan in the petition was
not made in bad faith or due to some ulterior motive; (3) petitioner is exempt from filing his
declaration of intention to become a Filipino citizen; and (4) petitioner has all the qualifications
to become a Filipino citizen.

1. Section 7 of the Naturalization Law (Comm. Act No. 473) specifically provides that the
petitioner will set forth, among others, whether he is single or married and the father of children,
"the name, age, birthplace and residence of the wife and each of the children." Petitioner gave the
flimsy explanation and his counsel tried to corroborate it that the failure to state the names of the
two (2) children (Espiritu and Alfonso) was due to the belief that there was an necessity for it. It
will be recalled that it was only during the cross-examination that the existence of these children
was elicited; that petitioner did not voluntarily tell the court, during the hearings, that he had
another son besides Espiritu and that it was only when the Fiscal asked for time to file a
memorandum that petitioner moved for a re-opening of the case, alleging that he had to introduce
material and relevant facts, which turned out to be the existence of another son.

The law requires the petitioner, if he is the father of children, to state the name, age, birthplace
and residence of each of the children, without making a distinction whether the petitioner's
children are minors or of age. Where the law does not distinguish we should not distinguish. If it
were the intention of the law to require only minor children of the petitioner to be mentioned in
the petition, it would have so stated. An applicant for naturalization must comply with all the
requirements and conditions petitions specified by law (Lau Lang Sin vs. Republic, 48 O.G. p.
1780). To dispense with some requirements of the law on the shallow excuse that petitioner's
counsel was responsible for the omission, would blaze the trail for dangerous precedents.

2 and 3. It would seem that the omission was tinged with the color of bad faith and done for
ulterior motives, considering the facts that petitioner claims exemption to file his declaration of
intention. Commonwealth Act No. 535, amending section 6 of the Naturalization Law, provides
that, "Persons born in the Philippines and have received their primary and secondary education in
public schools or those recognized by the Government and not limited to any race or nationality,
and those who have resided continuously in the Philippines for a period of thirty years or more
before filing their application, may be naturalized without having to make a declaration of
intention upon complying with the other requirements of this Act. To such requirements shall be
added that which establishes that the applicant has given primary and secondary education to all
his children in the public schools or in private schools recognized by the Government and not
limited to any race or nationality. . . . ." While petitioner might have satisfied the condition of the
thirty years continuous residence, he has, however, failed to comply with the further requisite of
having given all his children of school age, primary and secondary education. Awareness of this
requisite has undoubtedly motivated the petitioner to exclude the names of Espiritu and Alfonso
in the petition, contrariwise, he would have been compelled to show that he had given said
children primary and secondary education in the proper schools, which he had admittedly failed
to do. Under these facts, petitioner is not entitled to the exemption of making a declaration of
intention. The failure to file a declaration of intention within the prescribed time, in accordance
with the requirements of Section 5 of the Naturalization Law, is fatal to his application (Yu
Hiang vs. Republic, G.R. No. L-8378, March 23, 1956).

The requirements of the law regarding the qualifications of a petitioner for citizenship are
stringent. In view of the above findings, it is seriously doubted whether the petitioner herein
possesses the qualifications to become a Filipino citizen. Doubts concerning grant of citizenship
should be resolved in favor of the government and against the claimant (U.S. vs. Macintosh,
N.Y., 1931, 51 S. Ct. 570, 283 U.S. 605, 75 L. Ed. 1302, cited in Velayo's Philippine Citizenship
and Naturalization, p. 1153).

The decision appealed from is hereby reversed and another entered denying the petition for
citizenship of petitioner-appellee Tan Chu Keng. Costs against the petitioner-appellee.

G.R. No. 127240 March 27, 2000

ONG CHIA, petitioner,

vs.
REPUBLIC OF THE PHILIPPINES and THE COURT OF APPEALS, respondents.

MENDOZA, J.:
This is a petition for review of the decision1 of the Court of Appeals reversing the decision of the
Regional Trial Court, Branch 24, Koronadal, South Cotabato2 admitting petitioner Ong Chia to
Philippine citizenship.

The facts are as follows:

Petitioner was born on January 1, 1923 in Amoy, China. In 1932, as a nine-year old boy, he
arrived at the port of Manila on board the vessel "Angking." Since then, he has stayed in the
Philippines where he found employment and eventually started his own business, married a
Filipina, with whom he had four children. On July 4, 1989, at the age of 66, he filed a verified
petition to be admitted as a Filipino citizen under C.A. No. 473, otherwise known as the Revised
Naturalization Law, as amended. Petitioner, after stating his qualifications as required in §2, and
lack of the disqualifications enumerated in §3 of the law, stated —

17. That he has heretofore made (a) petition for citizenship under the provisions of Letter
of Instruction No. 270 with the Special Committee on Naturalization, Office of the
Solicitor General, Manila, docketed as SCN Case No. 031776, but the same was not acted
upon owing to the fact that the said Special Committee on Naturalization was not
reconstituted after the February, 1986 revolution such that processing of petitions for
naturalization by administrative process was suspended;

During the hearings, petitioner testified as to his qualifications and presented three witnesses to
corroborate his testimony. So impressed was Prosecutor Isaac Alvero V. Moran with the
testimony of petitioner that, upon being asked by the court whether the State intended to present
any witness present any witness against him, he remarked:

Actually, Your Honor, with the testimony of the petitioner himself which is rather
surprising, in the sense that he seems to be well-versed with the major portion of the
history of the Philippines, so, on our part, we are convinced, Your Honor Please, that
petitioner really deserves to be admitted as a citizen of the Philippines. And for this
reason, we do not wish to present any evidence to counteract or refute the testimony of
the witnesses for the petitioner, as well as the petitioner himself.3

Accordingly, on August 25, 1999, the trial court granted the petition and admitted petitioner to
Philippine citizenship. The State, however, through the Office of the Solicitor General, appealed
all the names by which he is or had been known; (2) failed to state all his former placer of
residence in violation of C.A. No. 473, §7; (3) failed to conduct himself in a proper and
irreproachable manner during his entire stay in the Philippines, in violation of §2; (4) has no
known lucrative trade or occupation and his previous incomes have been insufficient or
misdeclared, also in contravention of §2; and (5) failed to support his petition with the
appropriate documentary evidence.4

Annexed to the State's appellant's brief was a copy of a 1977 petition for naturalization filed by
petitioner with the Special Committee on Naturalization in SCN Case No. 031767,5 in which
petitioner stated that in addition to his name of "Ong Chia," he had likewise been known since
childhood as "Loreto Chia Ong." As petitioner, however, failed to state this other name in his
1989 petition for naturalization, it was contended that his petition must fail.6 The state also
annexed income tax returns7 allegedly filed by petitioner from 1973 to 1977 to show that his net
income could hardly support himself and his family. To prove that petitioner failed to conduct
himself in a proper and irreproachable manner during his stay in the Philippines, the State
contended that, although petitioner claimed that he and Ramona Villaruel had been married
twice, once before a judge in 1953, and then again in church in 1977, petitioner actually lived
with his wife without the benefit of marriage from 1953 until they were married in 1977. It was
alleged that petitioner failed to present his 1953 marriage contract, if there be any. The State also
annexed a copy of petitioner's 1977 marriage contract8 and a Joint-Affidavit9 executed by
petitioner and his wife. These documents show that when petitioner married Ramona Villaruel
on February 23, 1977, no marriage license had been required in accordance with Art. 76 of the
Civil Code because petitioner and Ramona Villaruel had been living together as husband and
wife since 1953 without the benefit of marriage. This, according to the State, belies his claim that
when he started living with his wife in 1953, they had already been married.

The State also argued that, as shown by petitioner's Immigrant Certificate of Residence, 10
petitioner resided at "J.M. Basa Street, Iloilo," but he did not include said address in the petition.

On November 15, 1996, the Court of Appeals rendered its decision which, as already noted,
reversed the trial court and denied petitioner's application for naturalization. It ruled that due to
the importance naturalization cases, the State is not precluded from raising questions not
presented in the lower court and brought up for the first time on appeal. 11 The appellate court
held:

As correctly observed by the Office of the Solicitor General, petitioner Ong Chia failed to
state in this present petition for naturalization his other name, "LORETO CHIA ONG,"
which name appeared in his previous application under Letter of Instruction No. 270.
Names and pseudonyms must be stated in the petition for naturalization and failure to
include the same militates against a decision in his favor. . . This is a mandatory
requirement to allow those persons who know (petitioner) by those other names to come
forward and inform the authorities of any legal objection which might adversely affect
his application for citizenship.

Furthermore, Ong Chia failed to disclose in his petition for naturalization that he formerly
resided in "J.M. Basa St., Iloilo" and "Alimodian, Iloilo." Section 7 of the Revised
Naturalization Law requires the applicant to state in his petition "his present and former
places of residence." This requirement is mandatory and failure of the petitioner to
comply with it is fatal to the petition. As explained by the Court, the reason for the
provision is to give the public, as well as the investigating agencies of the government,
upon the publication of the petition, an opportunity to be informed thereof and voice their
objections against the petitioner. By failing to comply with this provision, the petitioner
is depriving the public and said agencies of such opportunity, thus defeating the purpose
of the law. . .

Ong Chia had not also conducted himself in a proper and irreproachable manner when he
lived-in with his wife for several years, and sired four children out of wedlock. It has
been the consistent ruling that the "applicant's 8-year cohabitation with his wife without
the benefit of clergy and begetting by her three children out of wedlock is a conduct far
from being proper and irreproachable as required by the Revised Naturalization Law",
and therefore disqualifies him from becoming a citizen of the Philippines by
naturalization . . .

Lastly, petitioner Ong Chia's alleged annual income in 1961 of P5,000.00, exclusive of
bonuses, commissions and allowances, is not lucrative income. His failure to file an
 income tax return "because he is not liable for income tax yet" confirms that his income
is low. . . "It is not only that the person having the employment gets enough for his
ordinary necessities in life. It must be shown that the employment gives one an income
such that there is an appreciable margin of his income over expenses as to be able to
provide for an adequate support in the event of unemployment, sickness, or disability to
work and thus avoid one's becoming the object of charity or public charge." . . . Now that
they are in their old age, petitioner Ong Chia and his wife are living on the allowance
given to them by their children. The monthly pension given by the elder children of the
applicant cannot be added to his income to make it lucrative because like bonuses,
commissions and allowances, said pensions are contingent, speculative and precarious. . .

Hence, this petition based on the following assignment of errors:

I. THE COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION IN RULING

THAT IN NATURALIZATION CASES, THE APPELLATE COURT CAN DENY AN
APPLICATION FOR PHILIPPINE CITIZENSHIP ON THE BASIS OF DOCUMENTS
NOT PRESENTED BEFORE THE TRIAL COURT AND NOT FORMING PART OF
THE RECORDS OF THE CASE.

II. THE FINDING OF THE COURT OF APPEALS THAT THE PETITIONER HAS
BEEN KNOWN BY SOME OTHER NAME NOT STATED IN HIS PETITION IS NOT
SUPPORTED BY THE EVIDENCE ON RECORD.

III. CONTRARY TO THE FINDING OF THE COURT OF APPEALS, THE

PETITIONER STATED IN HIS PETITION AND ITS ANNEXES HIS PRESENT AND
FORMER PLACES OF RESIDENCE.

IV. THE FINDING OF THE COURT OF APPEALS THAT THE PETITIONER

FAILED TO CONDUCT HIMSELF IN A PROPER AND IRREPROACHABLE
MANNER IS NOT SUPPORTED BY THE EVIDENCE ON RECORD.

Petitioner's principal contention is that the appellate court erred in considering the documents
which had merely been annexed by the State to its appellant's brief and, on the basis of which,
justified the reversal of the trial court's decision. Not having been presented and formally offered
as evidence, they are mere "scrap(s) of paper devoid of any evidentiary value," 12 so it was
argued, because under Rule 132, §34 of the Revised Rules on Evidence, the court shall consider
no evidence which has not been formally offered.

The contention has no merit. Petitioner failed to note Rule 143 13 of the Rules of Court which
provides that —

These rules shall not apply to land registration, cadastral and election cases,
naturalization and insolvency proceedings, and other cases not herein provided for,
except by analogy or in a suppletory character and whenever practicable and convenient.
(Emphasis added).

Prescinding from the above, the rule on formal offer of evidence (Rule 132, §34) now being
invoked by petitioner is clearly not applicable to the present case involving a petition for
naturalization. The only instance when said rules may be applied by analogy or suppletorily in
such cases is when it is "practicable and convenient." That is not the case here, since reliance
upon the documents presented by the State for the first time on appeal, in fact, appears to be the
more practical and convenient course of action considering that decisions in naturalization
proceedings are not covered by the rule on res judicata. 14 Consequently, a final favorable
judgment does not preclude the State from later on moving for a revocation of the grant of
naturalization on the basis of the same documents.

Petitioner claims that as a result of the failure of the State to present and formally offer its
documentary evidence before the trial court, he was denied the right to object against their
authenticity, effectively depriving him of his fundamental right to procedural due process. 15 We
are not persuaded. Indeed, the reason for the rule prohibiting the admission of evidence which
has not been formally offered is to afford the opposite party the chance to object to their
admissibility. 16 Petitioner cannot claim that he was deprived of the right to object to the
authenticity of the documents submitted to the appellate court by the State. He could have
included his objections, as he, in fact, did, in the brief he filed with the Court of Appeals. thus:

The authenticity of the alleged petition for naturalization (SCN Case No. 031767) which
was supposedly filed by Ong Chia under LOI 270 has not been established. In fact, the
case number of the alleged petition for naturalization. . . is 031767 while the case number
of the petition actually filed by the appellee is 031776. Thus, said document is totally
unreliable and should not be considered by the Honorable Court in resolving the instant
appeal. 17

Indeed, the objection is flimsy as the alleged discrepancy is trivial, and, at most, can be
accounted for as a typographical error on the part of petitioner himself. That "SCN Case No.
031767," a copy of which was annexed to the petition, is the correct case number is confirmed by
the Evaluation Sheet 18 of the Special Committee on Naturalization which was also docketed as
"SCN Case No. 031767." Other than this, petitioner offered no evidence to disprove the
authenticity of the documents presented by the State.

Furthermore, the Court notes that these documents — namely, the petition in SCN Case No.
031767, petitioner's marriage contract, the joint affidavit executed by him and his wife, and
petitioner's income tax returns — are all public documents. As such, they have been executed
under oath. They are thus reliable. Since petitioner failed to make a satisfactory showing of any
flaw or irregularity that may cast doubt on the authenticity of these documents, it is our
conclusion that the appellate court did not err in relying upon them.

One last point. The above discussion would have been enough to dispose of this case, but to
settle all the issues raised, we shall briefly discuss the effect of petitioner's failure to include the
address "J.M. Basa St., Iloilo" in his petition, in accordance with §7, C.A. No. 473. This address
appears on petitioner's Immigrant Certificate of Residence, a document which forms part of the
records as Annex A of his 1989 petition for naturalization. Petitioner admits that he failed to
mention said address in his petition, but argues that since the Immigrant Certificate of Residence
containing it had been fully published, 19 with the petition and the other annexes, such
publication constitutes substantial compliance with §7. 20 This is allegedly because the
publication effectively satisfied the objective sought to be achieved by such requirement, i.e., to
give investigating agencies of the government the opportunity to check on the background of the
applicant and prevent suppression of information regarding any possible misbehavior on his part
in any community where he may have lived at one time or another. 21 It is settled, however, that
naturalization laws should be rigidly enforced and strictly construed in favor of the government
and against the applicant. 22 As noted by the State, C.A. No. 473, §7 clearly provides that the
applicant for naturalization shall set forth in the petition his present and former places of
residence. 23 This provision and the rule of strict application of the law in naturalization cases
defeat petitioner's argument of "substantial compliance" with the requirement under the Revised
Naturalization Law. On this ground alone, the instant petition ought to be denied.1âwphi1.nêt

WHEREFORE, the decision of the Court of Appeals is AFFIRMED and the instant petition is
hereby DENIED.

SO ORDERED.

INSURANCE

G.R. No. 173017 March 17, 2009

FELIMON BIGORNIA, SPO3 BORROMEO GORRES, ADELIANO RICO, SPO3

JOVENTINO BIGORNIA, SPO3 ALMANZOR JANGAO, SPO2 MESTERIOSO
ARANCO, Petitioners,
vs.
COURT OF APPEALS (23rd Division), and MELCHOR AROMA, Respondents.

DECISION

QUISUMBING, J.:

This petition for certiorari assails the Resolutions dated July 22, 20041 and April 3, 20062 of the
Court of Appeals in CA-G.R. CV No. 73091. The appellate court dismissed petitioners’ appeal
and denied their motion for reconsideration.

The pertinent facts are as follows:

Private respondent Melchor Aroma filed an action for replevin with damages against petitioners
before the Regional Trial Court (RTC) of Lanao del Norte. Petitioners allegedly detained
Aroma’s fishing vessel for 14 days after it was seized in a seaborne patrol.

On August 28, 2001, the RTC rendered a Decision3 in favor of respondent. It ordered petitioners
to pay jointly and severally the sums of ₱350,000 by way of actual and compensatory damages;
₱100,000 as moral and exemplary damages; attorney’s fees of ₱20,000; and the costs of suit.

Petitioners appealed. On January 19, 2004, the office of Atty. Arthur L. Abundiente, counsel for
petitioners, received notice requiring petitioners to file an appellants’ brief within 45 days or
until March 4, 2004. Petitioners however, filed their brief only on March 18, 2004, 14 days
beyond the deadline. On July 22, 2004, the Court of Appeals issued the challenged Resolution.
Its fallo states:
Having been unjustifiably filed out of time, the Appellant[s’] Brief is ORDERED EXPUNGED
FROM/STRICKEN OFF THE RECORDS. This instant appeal is accordingly DISMISSED
pursuant to Section 1(e), Rule 50 of the 1997 Rules on Civil Procedure for appellants’ failure to
file their Brief within the time provided for under the Rules.

SO ORDERED.4

Petitioners moved for reconsideration, but the same was denied in a Resolution dated April 3,
2006, as follows:

WHEREFORE, the motion for reconsideration is DENIED for lack of merit.

SO ORDERED.5

Hence, the instant petition which presents the single issue:

WHETHER OR NOT THE 23rd DIVISION OF THE COURT OF APPEALS ACTED WITH
GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION IN NOT ADMITTING THE APPELLANTS’ BRIEF, AND IN ORDERING
THAT THE SAME BE EXPUNGED FROM THE RECORD.6

Stated simply, the lone issue for our consideration is whether the Court of Appeals gravely
abused its discretion in dismissing the appeal.

Petitioners explain that their counsel was unable to file the brief on time because he was busy
campaigning as candidate for Vice Governor of Lanao del Norte.7 Petitioners fault the Court of
Appeals for giving notice to file brief only two years after they appealed.8 They claim that they
could have immediately submitted a brief had notice been sent earlier.1avvphi1

Petitioners contend that dismissal of an appeal under Section 1(e),9 Rule 50 of the Rules of Court
is directory, not mandatory. They cite the case of United Feature Syndicate, Inc. v. Munsingwear
Creation Manufacturing Company,10 where a lapsed appeal was allowed by the Court in the
interest of substantial justice. According to them, a lesser offense of delay in filing of brief
should merit the same consideration. Petitioners argue that rules of procedure should be liberally
construed so that cases may be resolved on the merits, and not on technicalities.

Private respondent counters that technical rules of procedure were designed to effect expediency.
Thus, a party seeking liberal application of the rules must adequately explain his failure to abide
by them. Respondent believes that petitioners failed in this respect.

Technically, the Court of Appeals may dismiss an appeal for failure of the appellant to file the
appellants’ brief on time. But, the dismissal is directory, not mandatory. Hence, the court has
discretion to dismiss or not to dismiss the appeal. It is a power conferred on the court, not a duty.
The discretion, however, must be a sound one, to be exercised in accordance with the tenets of
justice and fair play, having in mind the circumstances obtaining in each case.111avvphi1.zw+

Petitioners had 45 days or until March 4, 2004 to file an appellants’ brief. Unfortunately,
petitioners could not be located as some of them retired while the rest were assigned to other
places. It was their counsel who took the liberty of filing a brief in their behalf, but 14 days late
and without a motion for leave of court for its admission. Nonetheless, the more pressing
consideration of substantial justice compels this Court to heed the plea of petitioners. The
amount of damages involved in this case is relatively substantial. Petitioners are police officers,
and government employees who receive meager salaries for risking life and limb. It is but fair
that they be heard on the merits of their case before being made to pay damages, for what could
be, a faithful performance of duty.

The circulars of this Court prescribing technical and other procedural requirements are meant to
promptly dispose of unmeritorious petitions that clog the docket and waste the time of the courts.
These technical and procedural rules, however, are intended to ensure, not suppress, substantial
justice. A deviation from their rigid enforcement may thus be allowed to attain their prime
objective for, after all, the dispensation of justice is the core reason for the existence of courts.12
Thus, in a considerable number of cases,13 the Court has deemed it fit to suspend its own rules or
to exempt a particular case from its strict operation where the appellant failed to perfect his
appeal within the reglementary period, resulting in the appellate court’s failure to obtain
jurisdiction over the case. With more reason, there should be wider latitude in exempting a case
from the strictures of procedural rules when the appellate court has already obtained jurisdiction
over the appealed case and, as in this case, petitioners failed to file the appellants’ brief14 on
time.

WHEREFORE, in the interest of substantial justice, the instant petition is GRANTED. The
Resolutions dated July 22, 2004 and April 3, 2006 of the Court of Appeals in CA-G.R. CV No
73091 are SET ASIDE; petitioners’ appeal is reinstated; and the instant case is REMANDED to
the Court of Appeals for further proceedings.

SO ORDERED.

G.R. No. L-43706 November 14, 1986

NATIONAL POWER CORPORATION, petitioner,

vs.
COURT OF APPEALS and PHILIPPINE AMERICAN GENERAL INSURANCE CO., INC., respondents.

Conrado Q. Crucillo for petitioner.

Gregorio D. David for private respondent.

PARAS, J.:

This is a petition for review on certiorari seeking to set aside: (a) the judgment of respondent Court of Appeals dated March 25, 1976 in CA-
G.R. No. 50112-R, entitled National Power Corporation, Plaintiff-Appellee vs. The Philippine American Insurance Company, Inc. Defendant-
Appellant, which reversed the decision of the Court of First Instance of Manila in Civil Case No. 70811 entitled "National Power Corporation
v. Far Eastern Electric, Inc., et al." and (b) respondent's Court's resolution dated April 19, 1976 denying petitioner National Power
Corporation's Motion for Reconsideration (Petition, p. 13, Rollo).

The undisputed facts of this case are as follows:

The National Power Corporation (NPC) entered into a contract with the Far Eastern Electric, Inc. (FFEI) on December 26, 1962 for the
erection of the Angat Balintawak 115-KW-3-Phase transmission lines for the Angat Hydroelectric Project. FEEI agreed to complete the work
within 120 days from the signing of the contract, otherwise it would pay NPC P200.00 per calendar day as liquidated damages, while NPC
agreed to pay the sum of P97,829.00 as consideration. On the other hand, Philippine American General Insurance Co., Inc. (Philamgen)
issued a surety bond in the amount of P30,672.00 for the faithful performance of the undertaking by FEEI, as required.

The condition of the bond reads:

 The liability of the PHILIPPINE AMERICAN GENERAL INSURANCE COMPANY, INC. under this bond will expire One
(1) year from final Completion and Acceptance and said bond will be cancelled 30 days after its expiration, unless
surety is notified of any existing obligation thereunder. (Exhibit 1-a)

in correlation with the provisions of the construction contract between Petitioner and Far Eastern Electric, Inc. particularly the following
provisions of the Specifications. to wit:

1. Par. 1B-2l Release of Bond

1B-21 Release of Bond

The Contractor's performance bond will be released by the National Power Corporation at the expiration of one (1) year
from the completion and final acceptance of the work, pursuant to the provisions of Act No. 3959, and subject to the
General Conditions of this contract. (Page 49, Printed Record on Appeal); and

2. GP-19 of Specifications, which reads:

(a) Should the Contractor fail to complete the construction of the work as herein specified and agreed upon, or if the
work is abandoned, ... the Corporation shall have the power to take over the work by giving notice in writing to that
effect to the Contractor and his sureties of its intention to take over the construction work.

(b) ... It is expressly agreed that in the event the corporation takes over the work from the Contractor, the latter and his
bondsmen shall continue to be liable under this contract for any expense in the completion of the work in excess of the
contract price and the bond filed by the Contractor shall be answerable for the same and for any and all damages that
the Corporation may suffer as a result thereof. (pp. 76-78, Printed Record on Appeal)

FEEI started construction on December 26, 1962 but on May 30, 1963, both FEEI and Philamgen wrote NPC requesting the assistance of
the latter to complete the project due to unavailability of the equipment of FEEI. The work was abandoned on June 26, 1963, leaving the
construction unfinished. On July 19, 1963, in a joint letter, Philamgen and FEEI informed NPC that FEEI was giving up the construction due
to financial difficulties. On the same date, NPC wrote Philamgen informing it of the withdrawal of FEEI from the work and formally holding
both FEEI and Philamgen liable for the cost of the work to be completed as of July 20, 1962 plus damages.

The work was completed by NPC on September 30, 1963. On January 30, 1967 NPC notified Philamgen that FEEI had an outstanding
obligation in the amount of P75,019.85, exclusive of interest and damages, and demanded the remittance of the amount of the surety bond
the answer for the cost of completion of the work. In reply, Philamgen requested for a detailed statement of account, but after receipt of the
same, Philamgen did not pay as demanded but contended instead that its liability under the bond has expired on September 20, 1964 and
claimed that no notice of any obligation of the surety was made within 30 days after its expiration. (Record on Appeal, pp. 191-194; Rollo, pp.
62-64).

NPC filed Civil Case No. 70811 for collection of the amount of P75,019.89 spent to complete the work abandoned; P144,000.00 as liquidated
damages and P20,000.00 as attorney's fees. Only Philamgen answered while FEEI was declared in default.

The trial court rendered judgment in favor of NPC, the dispositive portion of which reads:

WHEREFORE, the defendant Far Eastern Electric, Inc., is ordered to pay the plaintiff the sum of P75,019.86 plus
interest at the legal rate from September 21, 1967 until fully paid. Out of said amount, both defendants, Far Eastern
Electric, Inc., and the Philippine American Insurance Company, Inc., are ordered to pay, jointly and severally, the
amount of P30,672.00 covered by Surety Bond No. 26268, dated December 26, 1962, plus interest at the legal rate
from September 21, 1967 until fully paid,

Both defendants are also ordered to pay plaintiff the sum of P3,000.00 as attorney's fees and costs.

On appeal by Philamgen, the Court of Appeals reversed the lower court's decision and dismissed the complaint.

Hence this petition.

Respondent Philamgen filed its comment on the petition on August 6, 1978 (Rollo, p. 62) in compliance with the resolution dated June 16,
1976 of the First Division of this Court (Rollo, p. 52) while petitioner NPC filed its Reply to the comment of respondent (Rollo, p. 76) as
required in the resolution of this Court of August 16, 1976, (Rollo, p. 70). In the resolution of September 20, 1976, the petition for certiorari
was given due course (Rollo, p. 85). Petitioner's brief was filed on November 27, 1976 (Rollo, p. 97) while Philamgen failed to file brief within
the required period and this case was submitted for decision without respondent's brief in the resolution of this Court of February 25. 1977)
Rollo, p. 103).

In its brief, petitioner raised the following assignment of errors:

RESPONDENT COURT OF APPEALS ERRED IN HOLDING THAT PETITIONER SHOULD HAVE GIVEN NOTICE
TO PRIVATE RESPONDENT PHILAMGEN OF ANY EXISTING OBLIGATION WITHIN 30 DAYS FROM EXPIRATION
 OF THE BOND TO HOLD SAID SURETY LIABLE THEREUNDER, DESPITE PETITIONER'S TAKING OVER OF THE
WORK ABANDONED BY THE CONTRACTOR BEFORE ITS COMPLETION.

II

ASSUMING ARGUENDO THAT PETITIONER SHOULD STILL NOTIFY PRIVATE RESPONDENT PHILAMGEN OF
ANY EXISTING OBLIGATION UNDER THE BOND DESPITE THE TAKE-OVER OF WORK BY PETITIONER,
RESPONDENT COURT OF APPEALS NONETHELESS ERRED IN HOLDING THAT PETITIONER'S LETTER DATED
JULY 19, 1963 (EXH. E) TO PRIVATE RESPONDENT WAS NOT SUFFICIENT COMPLIANCE WITH THE
CONDITION OF THE BOND.

III

RESPONDENT COURT OF APPEALS ERRED IN ABSOLVING PRIVATE RESPONDENT PHILAMGEN FROM ITS
LIABILITY UNDER THE BOND.

The decisive issue in this case is the correct interpretation and/or application of the condition of the bond relative to its expiration, in
correlation with the provisions of the construction contract, the faithful performance of which, said bond was issued to secure.

The bone of contention in this case is the compliance with the notice requirement as a condition in order to hold the surety liable under the
bond.

Petitioner claims that it has already complied with such requirement by virtue of its notice dated July 19, 1963 of abandonment of work by
FEEI and of its takeover to finish the construction, at the same time formally holding both FEEI and Philamgen liable for the uncompleted
work and damages. It further argued that the notice required in the bond within 30 days after its expiration of any existing obligation, is
applicable only in case the contractor itself had completed the contract and not when the contractor failed to complete the work, from which
arises the continued liability of the surety under its bond as expressly provided for in the contract. Petitioner's contention was sustained by
the trial court.

On the other hand, private respondent insists that petitioner's notice dated July 19, 1983 is not sufficient despite previous events that it had
knowledge of FEEI's failure to comply with the contract and claims that it cannot be held liable under the bond without notice within thirty
days from the expiration of the bond, that there is a subsisting obligation. Private respondent's contention is sustained by the Court of
Appeals.

The petition is impressed with merit.

As correctly assessed by the trial court, the evidence on record shows that as early as May 30, 1963, Philamgen was duly informed of the
failure of its principal to comply with its undertaking. In fact, said notice of failure was also signed by its Assistant Vice President. On July 19,
1963, when FEEI informed NPC that it was abandoning the construction job, the latter forthwith informed Philamgen of the fact on the same
date. Moreover, on August 1, 1963, the fact that Philamgen was seasonably notified, was even bolstered by its request from NPC for
information of the percentage completed by the bond principal prior to the relinquishment of the job to the latter and the reason for said
relinquishment. (Record on Appeal, pp. 193-195). The 30-day notice adverted to in the surety bond applies to the completion of the work by
the contractor. This completion by the contractor never materialized.

The surety bond must be read in its entirety and together with the contract between NPC and the contractors. The provisions must be
construed together to arrive at their true meaning. Certain stipulations cannot be segregated and then made to control.

Furthermore, it is well settled that contracts of insurance are to be construed liberally in favor of the insured and strictly against the insurer.
Thus ambiguity in the words of an insurance contract should be interpreted in favor of its beneficiary. (Serrano v. Court of Appeals, 130
SCRA 327, July 16, 1984).

In the case at bar, it cannot be denied that the breach of contract in this case, that is, the abandonment of the unfinished work of the
transmission line of the petitioner by the contractor Far Eastern Electric, Inc. was within the effective date of the contract and the surety bond.
Such abandonment gave rise to the continuing liability of the bond as provided for in the contract which is deemed incorporated in the surety
bond executed for its completion. To rule therefore that private respondent was not properly notified would be gross error.

PREMISES CONSIDERED, the decision dated March 25, 1976 and the resolution dated April 19, 1976 of the Court of Appeals are hereby
SET ASIDE, and a new one is hereby rendered reinstating the decision of the Court of First Instance of Manila in Civil Case No. 70811
entitled "National Power Corporation v. Far Eastern Electric, Inc., et al."

SO ORDERED.
COMPUTATION OF TIME

G.R. No. L-25290 March 18, 1966

SOTERA VIRAY, petitioner,

vs.
THE HON. COURT OF APPEALS, HON. GREGORIO LEGASPI and HEIRS OF
CEZARIA MERENDO, respondents.

Andres Amante, Jr. for the petitioner.

Regino M. Monta for the respondents.

RESOLUTION

REYES, J.B.L., J.:

On October 25, 1965, petitioner received notice that her motion for reconsideration of the
adverse decision rendered by the Court of Appeals in CA-G.R. No. 31922R was denied.
Admittedly, the 15-day period allotted her by the Rules to appeal the decision to this Supreme
Court expired on November 9, 1965, since October had 31 days. However, upon petition by her
counsel, petitioner-appellant was granted —

an extension of only 15 days from the expiration of the reglementary period. (Res. of
Nov. 15, 1965, G.R. No. L-25290).

The petition for certiorari having been actually filed only on November 26, 1965, when the
period for so doing expired on November 24, this Court, by Resolution of February 8, 1966,
dismissed the petition for having been filed out of time.

Petitioner-appellant now moves for reconsideration, claiming that her first fifteen days that
should be counted from and after October 25, 1965, and which ended on November 9, should be
considered as expiring on November 10, 1965, because November 9 was a holiday (Election
day); that the 15-day extension granted her should, therefore, be counted from November 10; that
the 15 days from November 10 terminated on November 25; and as the latter was also a holiday
(Thanksgiving Day), the petitioner had until the next day, Friday, November 26, to file her
petition for review, which she did.

We rule that the motion for reconsideration is based on an erroneous premise. The extension of
15 days granted to the petitioner, tacked to the original 15 days granted her by the Rules of
Court, in effect gave her a thirty (30)-day period, from October 25, 1965, within which to file her
petition in this Court. Since October had 31 days, her last day was November 24, and not
November 26.
The rule that excludes the last day of a period, should the same be a holiday, refers to the
performance of the act prescribed or required. But it does not apply where at the end of the
period no such act is to be done. The rule is stated thus in American Jurisprudence:

Rules of Court in respect to the time for the doing of an act in a judicial proceeding
relating to a matter of practice are usually construed, where the last day for the doing of
an act falls on Sunday, to allow the whole of the next day for the purpose; and in many
states this construction has been adopted by statute or rule of court. The principle
announced, however, is subject to an exception where there is nothing to be done on the
last day, in which case Sunday is not to be excluded in the computation of time. (52 Am.
Jur. p. 345, sec. 19) (Emphasis supplied).

Nor do we see any merit in the substance of the petition itself. The refusal by the trial court to
admit an amended answer that would withdraw previous admissions and change the theory of the
case, adopted in the answer originally filed, can not constitute a grave abuse of discretion
considering that (1) no adequate excuse was offered for the delay in tendering the allegedly
correct facts and theory, and that (2) the unauthorized abandonment of her certificate of public
convenience, averred by petitioner Viray in the proposed amended answer, was in violation of
law, and can not be used by her to avoid her statutory obligations, as correctly held by the Court
of Appeals.1äwphï1.ñët

Wherefore, the motion for reconsideration is denied.

G.R. No. L-29131 August 27, 1969

NATIONAL MARKETING CORPORATION, plaintiff-appellant,

vs.
MIGUEL D. TECSON, ET AL., defendants,
MIGUEL D. TECSON, defendant-appellee,
THE INSURANCE COMMISSIONER, petitioner.

Government Corporate Counsel Leopoldo M. Abellera and Trial Atty. Antonio M. Brillantes for
plaintiff-appellant.
Antonio T. Lacdan for defendant-appellee.
Office of the Solicitor General for petitioner.

CONCEPCION, C.J.:

This appeal has been certified to us by the Court of Appeals only one question of law being
involved therein.

On November 14, 1955, the Court of First Instance of Manila rendered judgment, in Civil Case
No. 20520 thereof, entitled "Price Stabilization Corporation vs. Miguel D. Tecson and Alto
Surety and Insurance Co., Inc.," the dispositive part of which reads as follows:

For the foregoing consideration, the Court decides this case:

 (a) Ordering the defendants Miguel D. Tecson and Alto Surety Insurance Co., Inc. to pay
jointly and severally plaintiff PRATRA the sum of P7,200.00 plus 7% interest from May
25, 1960 until the amount is fully paid, plus P500.00 for attorney's fees, and plus costs;

(b) ordering defendant Miguel D. Tecson to indemnify his co-defendant Alto Surety &
Insurance Co., Inc. on the cross-claim for all the amounts it would be made to pay in this
decision, in case defendant Alto Surety & Insurance Co., Inc. pay the amount adjudged to
plaintiff in this decision. From the date of such payment defendant Miguel D. Tecson
would pay the Alto Surety & Insurance Co., Inc., interest at 12% per annum until Miguel
D. Tecson has fully reimbursed plaintiff of the said amount.

Copy of this decision was, on November 21, 1955, served upon the defendants in said case. On
December 21, 1965, the National Marketing Corporation, as successor to all the properties,
assets, rights, and choses in action of the Price Stabilization Corporation, as plaintiff in that case
and judgment creditor therein, filed, with the same court, a complaint, docketed as Civil Case
No. 63701 thereof, against the same defendants, for the revival of the judgment rendered in said
Case No. 20520. Defendant Miguel D. Tecson moved to dismiss said complaint, upon the ground
of lack of jurisdiction over the subject matter thereof and prescription of action. Acting upon the
motion and plaintiff's opposition thereto, said Court issued, on February 14, 1966, an order
reading:

Defendant Miguel Tecson seeks the dismissal of the complaint on the ground of lack of
jurisdiction and prescription. As for lack of jurisdiction, as the amount involved is less
than P10,000 as actually these proceedings are a revival of a decision issued by this same
court, the matter of jurisdiction must be admitted. But as for prescription. Plaintiffs admit
the decision of this Court became final on December 21, 1955. This case was filed
exactly on December 21, 1965 — but more than ten years have passed a year is a period
of 365 days (Art. 13, CCP). Plaintiff forgot that 1960, 1964 were both leap years so that
when this present case was filed it was filed two days too late.

The complaint insofar as Miguel Tecson is concerned is, therefore, dismissed as having
prescribed.1äwphï1.ñët

The National Marketing Corporation appealed from such order to the Court of Appeals, which,
on March 20, 1969t certified the case to this Court, upon the ground that the only question
therein raised is one of law, namely, whether or not the present action for the revival of a
judgment is barred by the statute of limitations.

Pursuant to Art. 1144(3) of our Civil Code, an action upon a judgment "must be brought within
ten years from the time the right of action accrues," which, in the language of Art. 1152 of the
same Code, "commences from the time the judgment sought to be revived has become final."
This, in turn, took place on December 21, 1955, or thirty (30) days from notice of the judgment
— which was received by the defendants herein on November 21, 1955 — no appeal having
been taken therefrom. 1 The issue is thus confined to the date on which ten (10) years from
December 21, 1955 expired.

Plaintiff-appellant alleges that it was December 21, 1965, but appellee Tecson maintains
otherwise, because "when the laws speak of years ... it shall be understood that years are of three
hundred sixty-five days each" — according to Art. 13 of our Civil Code — and, 1960 and 1964
being leap years, the month of February in both had 29 days, so that ten (10) years of 365 days
each, or an aggregate of 3,650 days, from December 21, 1955, expired on December 19, 1965.
The lower court accepted this view in its appealed order of dismissal.

Plaintiff-appellant insists that the same "is erroneous, because a year means a calendar year
(Statutory Construction, Interpretation of Laws, by Crawford, p. 383) and since what is being
computed here is the number of years, a calendar year should be used as the basis of
computation. There is no question that when it is not a leap year, December 21 to December 21
of the following year is one year. If the extra day in a leap year is not a day of the year, because
it is the 366th day, then to what year does it belong? Certainly, it must belong to the year where
it falls and, therefore, that the 366 days constitute one year." 2

The very conclusion thus reached by appellant shows that its theory contravenes the explicit
provision of Art. 13 of the Civil Code of the Philippines, limiting the connotation of each "year"
— as the term is used in our laws — to 365 days. Indeed, prior to the approval of the Civil Code
of Spain, the Supreme Court thereof had held, on March 30, 1887, that, when the law spoke of
months, it meant a "natural" month or "solar" month, in the absence of express provision to the
contrary. Such provision was incorporated into the Civil Code of Spain, subsequently
promulgated. Hence, the same Supreme Court declared 3 that, pursuant to Art. 7 of said Code,
"whenever months ... are referred to in the law, it shall be understood that the months are of 30
days," not the "natural," or "solar" or "calendar" months, unless they are "designated by name,"
in which case "they shall be computed by the actual number of days they have. This concept was
later, modified in the Philippines, by Section 13 of the Revised Administrative Code, Pursuant to
which, "month shall be understood to refer to a calendar month." 4 In the language of this Court,
in People vs. Del Rosario, 5 with the approval of the Civil Code of the Philippines (Republic Act
386) ... we have reverted to the provisions of the Spanish Civil Code in accordance with which a
month is to be considered as the regular 30-day month ... and not the solar or civil month," with
the particularity that, whereas the Spanish Code merely mentioned "months, days or nights," ours
has added thereto the term "years" and explicitly ordains that "it shall be understood that years
are of three hundred sixty-five days."

Although some members of the Court are inclined to think that this legislation is not realistic, for
failure to conform with ordinary experience or practice, the theory of plaintiff-appellant herein
cannot be upheld without ignoring, if not nullifying, Art. 13 of our Civil Code, and reviving
Section 13 of the Revised Administrative Code, thereby engaging in judicial legislation, and, in
effect, repealing an act of Congress. If public interest demands a reversion to the policy
embodied in the Revised Administrative Code, this may be done through legislative process, not
by judicial decree.

WHEREFORE, the order appealed from should be as it is hereby affirmed, without costs. It is so
ordered.

G.R. No. 157801 June 8, 2005

PRIMETOWN PROPERTY GROUP, INC., Petitioner,

vs.
HON. LYNDON D. JUNTILLA, in his capacity as HOUSING AND LAND USE ARBITER
of HLURB, Region VII, Cebu City, and TERESA C. AGUILAR, Respondents.
 DECISION

CALLEJO, SR., J.:

Before us is a petition for review on certiorari of the Decision1 of the Court of Appeals (CA) in
CA-G.R. SP No. 69812 which held that the Housing and Land Use Arbiter of the Housing and
Land Use Regulatory Board (HLURB) did not commit any grave abuse of discretion amounting
to lack or excess of jurisdiction in granting the motion of herein private respondent for a writ of
possession.

The controversy arose from the following antecedents:

In 1996, Teresa C. Aguilar entered into a contract to sell with Primetown Property Group, Inc.
(PPGI) covering a condominium unit which was under construction at Mary Cielo Leisure
Resort Compound, Opon, Lapu-Lapu City. PPGI obligated itself to deliver the unit by June 1998,
as indicated in its promotional material. Thereafter, Aguilar paid by installment the purchase
price of the condominium unit in the total amount of ₱727,921.82.2

After the lapse of almost two years after the signing of the contract to sell, Aguilar saw that the
construction of the building, where her supposed condominium unit was to be located, had barely
even started. Believing that PPGI would not be able to deliver the unit to her by June 1998, she
demanded in writing the rescission of her contract to sell with PPGI and the refund of what she
had paid. When PPGI refused, she filed a complaint3 against PPGI for the rescission of the
contract to sell and damages with the HLURB. The case was docketed as HLURB Case No.
REM-0207-0326198.

On August 26, 1999, the HLURB rendered its Decision4 in favor of Aguilar. The fallo of the
decision reads:

WHEREFORE, premises considered, judgment is hereby rendered in favor of the complainant

declaring the Contract to Sell executed by the parties as having been Rescinded and ordering the
Respondent to:

a. Pay the complainant the amount of ₱727,921.82 as refund of the payments made;

b. Pay the complainant 12% legal interest computed from the date of filing of this instant
case until its final determination;

c. Pay the complainant the amount of ₱50,000.00 as moral damages;

d. Pay the complainant the amount of ₱30,000.00 as exemplary damages;

e. Pay the complainant the amount of ₱25,000.00 as attorney’s fees and litigation
expenses;

f. Pay the Board administrative fine of ₱10,000.00 for violating Section 20. Of (sic)
Presidential Decree No. 957.

SO ORDERED.5
The respondent appealed the decision to the HLURB Board of Commissioners which, on
December 21, 1999, affirmed the same and declared it as final and executory. On motion of the
complainant, the HLURB issued a writ of execution ordering the ex-officio sheriff to execute its
decision against PPGI with address at the Penthouse, Century Citadel, No. 5007 P. Burgos
Street, Bel-Air, Makati City.

Sheriff Cesar D. Raagas of the Regional Trial Court (RTC) of Makati City, Branch 138, levied
several properties of PPGI, one of which was a condominium unit identified as Condominium
Unit No. 3301 in the Makati Prime Citadel located at P. Burgos Street, Makati City, and covered
by Condominium Certificate of Title (CCT) No. 25156. The sale at public auction was set on
March 30, 2000. He issued a Sheriff’s Notice of Sale dated February 17, 2000,6 posted a copy7
thereof to satisfy the writ of execution, and sent a copy of the said notice to PPGI at Room 2807,
Makati Prime Citadel Condominium, P. Burgos Street, Makati City.8 The same notice was also
published in the newspaper.9

Before the scheduled auction sale, or on March 21, 2000, Michael J. O’Pallick served a copy of
his affidavit of third-party claim10 to Sheriff Raagas. O’Pallick claimed that the condominium
unit was the subject of a contract to sell executed by PPGI in favor of Reynaldo Poblete and
Tomas Villanueva who, in turn, had executed a deed for assignment in his favor. The latter
appended copies of the said deeds to his affidavit.11

The Sheriff proceeded with the sale at public auction on March 30, 2000. Aguilar was declared
the highest bidder for the condominium unit for ₱1,200,000.00. The Sheriff executed a certificate
of sale over the property in her favor.12

Following the failure of PPGI to redeem the property, the Sheriff executed, on April 20, 2001, a
final deed of sale13 in favor of Aguilar, and in whose favor CCT No. 74777 was issued.14 She
declared the condominium unit for taxation purposes under Tax Declaration No. 10134.15

In the meantime, on November 6, 2001, the counsel of PPGI withdrew his appearance as its
counsel.16 On November 28, 2001, Aguilar filed a motion with the HLURB for the issuance of a
writ of possession.17 A copy of the motion was served on PPGI at its principal office as alleged
in the complaint at No. 21/F Multinational BanCorporation Centre, 6805 Ayala Avenue, Makati
City. It appears that Ramon Reyes, Jr. received the said copy for PPGI on November 23, 2001.18

During the hearing of the said motion, no representative of the PPGI appeared. On December 21,
2001, the HLURB issued its Order19 granting Aguilar’s motion for the issuance of a writ of
possession, and directing the PPGI, its officers, incorporators, stockholders and/or
assignees/transferees to peacefully vacate the subject condominium.20 It appears that the
president of PPGI was to be served with a copy of the order at Multinational BanCorporation
Centre, 6809 Ayala Avenue, Makati City.21

On January 18, 2002, PPGI filed its motion for reconsideration22 of the December 21, 2001
Order of the HLURB, contending that it was not served with a copy of Aguilar’s motion for the
issuance of a writ of possession. PPGI averred that it had transferred its office from 21/F
Multinational BanCorporation Centre, 6805 Ayala Avenue, Makati City to the Prime Citadel
Condominium, No. 5007 P. Burgos Street, Makati City. PPGI further averred that despite its
earnest efforts to secure copies of the aforementioned motion of Aguilar, the HLURB Arbiter
refused to furnish it with such copies. PPGI prayed that the HLURB Order dated December 21,
2001 be recalled and set aside and, in the meantime, an order suspending the implementation
thereof be issued. PPGI set the hearing of its motion on January 21, 2002. Meanwhile, on
January 22, 2002, the Sheriff placed Aguilar in physical possession of the subject
condominium.23

On February 27, 2002, the HLURB issued its Resolution24 denying the said motion for
reconsideration for lack of merit, and for the added reason that the same had already been
enforced and, as a consequence, the said motion was considered moot and academic.25

Aggrieved, PPGI filed, on April 11, 2002, its petition for certiorari with the CA under Rule 65
of the Rules of Court, and sought the reversal of the HLURB Order dated December 21, 2001 on
the following issue:

WHETHER OR NOT PUBLIC RESPONDENT GRAVELY ABUSED ITS DISCRETION

AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN GRANTING THE
QUESTIONED ORDER DATED DECEMBER 21, 2000 (SIC) AND THE RESOLUTION
DATED FEBRUARY 27, 2002, WHICH DENIED THE MOTION FOR
RECONSIDERATION.26

PPGI asserted that in issuing the writ of execution, the HLURB Arbiter took judicial notice of its
new address at the Prime Citadel Condominium at No. 5007 P. Burgos Street, Bel-Air, Makati
City. Despite this, the respondent caused the service of a copy of her motion for the issuance of a
writ of possession at its old office; hence, it behooved the HLURB to defer consideration of the
said motion until service had been made upon it at the said address. The petitioner asserted that
the HLURB acted arbitrarily when it allowed time to elapse before resolving the motion of the
respondent herein, and enabled the Sheriff to place her in possession of the property.1awphi1

In her comment on the petition, respondent Aguilar averred that (1) in view of the petitioner’s
failure to exhaust all administrative remedies (including a petition for certiorari before the Board
of Commissioners of the HLURB), the petition was premature; (2) in view of the claim of
O’Pallick that he had acquired ownership over the property, the latter was the real party-in-
interest to file the petition; and (3) the HLURB acted in accordance with the Rules of Procedure
of the HLURB when it resolved the respondent’s motion for a writ of possession.

On November 12, 2002, the CA rendered its Decision27 denying the petition of PPGI for lack of
merit. The appellate court declared that the records of the case reflected the address of PPGI as
"No. 21/F Multinational BanCorporation Centre, 6805 Ayala Avenue, Makati City," and that it
was never changed by PPGI; it remained as PPGI’s address on record. Thus, when Aguilar sent a
copy of her motion at the said address, PPGI was deemed to have been notified. On its claim that
its new address was known to the HLURB as shown in the writ of execution it issued, the CA
declared that the address "Rm. 2807, Makati Prime Citadel Condominium, No. 5007 P. Burgos
Street, Makati City," merely cropped-up because it was where the levied condominium unit was
located. The CA further ruled that the assailed order and resolution were legally issued. After all,
the respondent had already been issued CCT No. 74777 over the condominium unit; hence, she
was entitled to the possession thereof.

The appellate court denied the petitioner’s motion for reconsideration of the decision for lack of
merit.28

The PPGI, now the petitioner, filed a petition for review on certiorari alleging that:
 I.

THE COURT OF APPEALS ERRED IN AFFIRMING THE HOUSING AND LAND USE
REGULATORY BOARD’S ACTION IN ORDERING THE WRIT OF POSSESSION WHEN
PETITIONER PRIMETOWN WAS NOT INFORMED NOR DULY NOTIFIED OF THE
HEARING ON THE MOTION FOR ISSUANCE OF WRIT OF POSSESSION THEREBY
DEPRIVING PETITIONER PRIMETOWN OF ITS CONSTITUTIONAL RIGHT TO DUE
PROCESS.29

II.

THE COURT OF APPEALS ERRED IN CONFERRING POSSESSION IN FAVOR OF

RESPONDENT AGUILAR OVER THE SUBJECT CONDOMINIUM UNIT DESPITE THE
FACT THAT TITLE OR OWNERSHIP THERETO HAD BEEN WRONGLY
TRANSFERRED IN FAVOR OF RESPONDENT AGUILAR AS IT HAD BEEN SOLD
ALREADY TO ANOTHER BUYER PRIOR TO THE PUBLIC AUCTION HELD.30

On the first issue, the petitioner avers that under Sections 4 and 5, Rule 15 of the Rules of Court,
respondent Aguilar was mandated to serve on it a copy of her motion for the issuance of a writ of
possession at least three days before the date of its scheduled hearing. However, the respondent
failed to do so because she served a copy of the said motion at its old principal office at No. 21/F
Multinational BanCorporation Centre, No. 6805 Ayala Avenue, Makati City, and not at its new
principal office address. The petitioner avers that the HLURB and respondent Aguilar were
aware of its new principal office address because the writ of execution issued by the HLURB
specifically stated that its principal office was located at the "Penthouse, Century Citadel Inn,
No. 5007 P. Burgos Street, Bel-Air, Makati City."

The petitioner posits that the HLURB acted with grave abuse of its discretion amounting to
excess of jurisdiction in taking cognizance of and granting the respondent’s motion for a writ of
possession. As such, the petitioner posits, the motion of respondent Aguilar was a mere scrap of
paper. Worse, the HLURB dilly-dallied in resolving its motion for reconsideration, thus allowing
the Sheriff to place respondent Aguilar in possession of the unit and thereafter denying the said
motion solely on the ground that it had become moot and academic.1avvphi1 Patently, the
petitioner argues, it was deprived of its property without due process of law.

On the second issue, the petitioner avers that respondent Aguilar bought the property at public
auction in bad faith because, before she secured CCT No. 74777, on October 30, 2001, she was
already aware that the condominium unit had been sold by the petitioner on March 20, 1995 in
favor of Poblete and Villanueva, and that they assigned their right to O’Pallick, who, in turn,
executed his affidavit of third-party claim on March 17, 2000 and filed the same with the office
of the ex-officio Sheriff. Hence, respondent Aguilar was not entitled to the possession of the
condominium unit.

In her comment on the petition, respondent Aguilar avers that the petitioner failed to notify her
and the HLURB of any change or transfer of its principal office. Hence, she cannot be blamed
for serving a copy of her motion on the petitioner at its original principal office, and the HLURB
for serving a copy of its order at the said address. On the second issue, the respondent avers that
she was entitled to the possession of the unit following the issuance of CCT No. 74777 in her
favor. The respondent pointed out that O’Pallick had filed a complaint for quieting of title
against her with the RTC of Makati City on April 2, 2001 with a plea for injunctive relief, but
that the RTC denied his plea for injunctive relief and his motion for reconsideration thereof.
Besides, the respondent argues, her title cannot be the subject of a collateral attack.

The petition is bereft of merit.

First. The petitioner was mandated to notify the HLURB and the respondent herein of the
transfer of its principal office from the Multinational BanCorporation Centre to the Prime Citadel
Condominium at No. 5007 P. Burgos Street, Makati City. However, the petitioner failed to do so.
Based on the records of the HLURB and those of the respondent’s, the principal office of the
petitioner remained at the Multinational BanCorporation Centre. While it may be true that in the
writ of execution issued by the HLURB and the Sheriff’s notice of sale the address of the
petitioner appears to be at the Prime Citadel Condominium at No. 5007 P. Burgos Street, Makati
City, the said address had reference to the location of the condominium unit levied upon and
sought to be sold at public auction, not to the petitioner’s principal office. That the petitioner
retained its principal office at the Multinational BanCorporation Centre is shown by the fact that
its employee, Ramon Reyes, Jr., received a copy of the motion for the issuance of a writ of
possession filed by the respondent on November 23, 2001. The petitioner has not disputed the
authority of Reyes, Jr. to receive such copy of the respondent’s motion.

Second. The petitioner’s reliance on Sections 4, 5 and 6, Rule 15 of the Rules of Court, quoted,
infra, is misplaced:

Sec. 4. Hearing of motion. – Except for motions which the court may act upon without
prejudicing the rights of the adverse party, every written motion shall be set for hearing by the
applicant.

Every written motion required to be heard and the notice of the hearing thereof shall be served in
such a manner as to ensure its receipt by the other party at least three (3) days before the date of
hearing, unless the court for good cause sets the hearing on shorter notice.

Sec. 5. Notice of hearing. – The notice of hearing shall be addressed to all parties concerned, and
shall specify the time and date of the hearing which must not be later than ten (10) days after the
filing of the motion.

Sec. 6. Proof of service necessary. – No written motion set for hearing shall be acted upon by the
court without proof of service thereof.

This is so because the aforecited provisions apply only to a litigated motion and not to an ex
parte motion.

The said rules do not apply to a motion which is merely a mode by which the respondent herein
informed the Court that the writ of execution had not been implemented, and that she had not
been placed in possession of the property. There is no need for a hearing of such motion because
it is not a litigated motion, and the court may act thereon without prejudice to the rights of the
petitioner as the adverse party. The prejudice caused to the petitioner as the adverse party from
the HLURB order directing it and its officers and employees to vacate the condominium unit
would not have been greater than that caused by the issuance of the writ of execution itself. The
writ of possession was but an implementation of the writ of execution.31

Third. The procedure in a motion for the issuance of a writ of possession is ex parte and
summary in nature. It is a proceeding brought for the benefit of one party only and without notice
by the court to any person adverse of interest. It is a proceeding wherein relief is granted without
an opportunity for the person against whom the relief is sought to be heard.32 The issuance of a
writ of possession is not a judgment on the merits.33 Thus, the HLURB may grant the motion
even in the absence of the judgment obligor, herein petitioner.

Fourth. The buyer in a foreclosure sale becomes the absolute owner of the property purchased if
it is not redeemed during the period of one year after the registration of the sale.34 The issuance
of the writ of possession had become ministerial duty on the part of HLURB since the
respondent had sufficiently shown her proof of title over the subject condominium. Being the
registered owner of the condominium unit, she is entitled to its possession. The case at bar is
akin to foreclosure proceedings where the issuance of a writ of possession becomes a ministerial
act of the court after title on the property has been consolidated in the mortgage.35

It must be stressed that the Register of Deeds had already cancelled CCT No. 25156 and issued
CCT No. 74777 in the name of the respondent. Thus, the argument of the petitioner that the title
or ownership had been wrongfully vested with the respondent is a collateral attack on the latter’s
title which is more appropriate in a direct proceeding.36

IN LIGHT OF ALL THE FOREGOING, the petition is hereby DENIED for lack of merit.
Costs against the petitioner.

SO ORDERED.

CORPORATION
G.R. No. L-34382 July 20, 1983

THE HOME INSURANCE COMPANY, petitioner,

vs.
EASTERN SHIPPING LINES and/or ANGEL JOSE TRANSPORTATION, INC. and
HON. A. MELENCIO-HERRERA, Presiding Judge of the Manila Court of First
Instance, Branch XVII, respondents.

G.R. No. L-34383 July 20, 1983

THE HOME INSURANCE COMPANY, petitioner,

vs.
N. V. NEDLLOYD LIJNEN; COLUMBIAN PHILIPPINES, INC., and/or GUACODS,
INC., and HON. A. MELENCIO-HERRERA, Presiding Judge of the Manila Court of
First Instance, Branch XVII, respondents.
No. L-34382.

Zapa Law Office for petitioner.

Bito, Misa & Lozada Law Office for respondents.

No. L-34383.

Zapa Law Office for petitioner.

Ross, Salcedo, Del Rosario, Bito & Misa Law office for respondents.

GUTIERREZ, JR., J.:

Questioned in these consolidated petitions for review on certiorari are the decisions of
the Court of First Instance of Manila, Branch XVII, dismissing the complaints in Civil
Case No. 71923 and in Civil Case No. 71694, on the ground that plaintiff therein, now
appellant, had failed to prove its capacity to sue.

There is no dispute over the facts of these cases for recovery of maritime damages. In
L-34382, the facts are found in the decision of the respondent court which stated:

On or about January 13, 1967, S. Kajita & Co., on behalf of Atlas

Consolidated Mining & Development Corporation, shipped on board the
SS "Eastern Jupiter' from Osaka, Japan, 2,361 coils of "Black Hot Rolled
Copper Wire Rods." The said VESSEL is owned and operated by
defendant Eastern Shipping Lines (CARRIER). The shipment was covered
by Bill of Lading No. O-MA-9, with arrival notice to Phelps Dodge Copper
Products Corporation of the Philippines (CONSIGNEE) at Manila. The
shipment was insured with plaintiff against all risks in the amount of
P1,580,105.06 under its Insurance Policy No. AS-73633.

xxx xxx xxx

The coils discharged from the VESSEL numbered 2,361, of which 53 were
in bad order. What the CONSIGNEE ultimately received at its warehouse
was the same number of 2,361 coils with 73 coils loose and partly cut, and
28 coils entangled, partly cut, and which had to be considered as scrap.
Upon weighing at CONSIGNEE's warehouse, the 2,361 coils were found
to weight 263,940.85 kilos as against its invoiced weight of 264,534.00
kilos or a net loss/shortage of 593.15 kilos, according to Exhibit "A", or
1,209,56 lbs., according to the claims presented by the consignee against
the plaintiff (Exhibit "D-1"), the CARRIER (Exhibit "J-1"), and the
TRANSPORTATION COMPANY (Exhibit "K- l").

For the loss/damage suffered by the cargo, plaintiff paid the consignee
under its insurance policy the amount of P3,260.44, by virtue of which
plaintiff became subrogated to the rights and actions of the CONSIGNEE.
 Plaintiff made demands for payment against the CARRIER and the
TRANSPORTATION COMPANY for reimbursement of the aforesaid
amount but each refused to pay the same. ...

The facts of L-34383 are found in the decision of the lower court as follows:

On or about December 22, 1966, the Hansa Transport Kontor shipped

from Bremen, Germany, 30 packages of Service Parts of Farm Equipment
and Implements on board the VESSEL, SS "NEDER RIJN" owned by the
defendant, N. V. Nedlloyd Lijnen, and represented in the Philippines by its
local agent, the defendant Columbian Philippines, Inc. (CARRIER). The
shipment was covered by Bill of Lading No. 22 for transportation to, and
delivery at, Manila, in favor of the consignee, international Harvester
Macleod, Inc. (CONSIGNEE). The shipment was insured with plaintiff
company under its Cargo Policy No. AS-73735 "with average terms" for
P98,567.79.

xxx xxx xxx

The packages discharged from the VESSEL numbered 29, of which seven
packages were found to be in bad order. What the CONSIGNEE ultimately
received at its warehouse was the same number of 29 packages with 9
packages in bad order. Out of these 9 packages, 1 package was accepted
by the CONSIGNEE in good order due to the negligible damages
sustained. Upon inspection at the consignee's warehouse, the contents of
3 out of the 8 cases were also found to be complete and intact, leaving 5
cases in bad order. The contents of these 5 packages showed several
items missing in the total amount of $131.14; while the contents of the
undelivered 1 package were valued at $394.66, or a total of $525.80 or
P2,426.98.

For the short-delivery of 1 package and the missing items in 5 other

packages, plaintiff paid the CONSIGNEE under its Insurance Cargo Policy
the amount of P2,426.98, by virtue of which plaintiff became subrogated to
the rights and actions of the CONSIGNEE. Demands were made on
defendants CARRIER and CONSIGNEE for reimbursement thereof but
they failed and refused to pay the same.

In both cases, the petitioner-appellant made the following averment regarding its
capacity to sue:

The plaintiff is a foreign insurance company duly authorized to do business in the

Philippines through its agent, Mr. VICTOR H. BELLO, of legal age and with office
address at Oledan Building, Ayala Avenue, Makati, Rizal.

In L-34382, the respondent-appellee Eastern Shipping Lines, Inc., filed its answer and
alleged that it:

Denies the allegations of Paragraph I which refer to plaintiff's capacity to sue for lack of
knowledge or information sufficient to form a belief as to the truth thereof.
Respondent-appellee, Angel Jose Transportation, Inc., in turn filed its answer admitting
the allegations of the complaint, regarding the capacity of plaintiff-appellant. The
pertinent paragraph of this answer reads as follows:

Angel Jose Admits the jurisdictional averments in paragraphs 1, 2, and 3 of the heading
Parties.

In L-34383, the respondents-appellees N. V. Nedlloyd Lijhen, Columbian Philippines,

Inc. and Guacods, Inc., filed their answers. They denied the petitioner-appellant's
capacity to sue for lack of knowledge or information sufficient to form a belief as to the
truth thereof.

As earlier stated, the respondent court dismissed the complaints in the two cases on the
same ground, that the plaintiff failed to prove its capacity to sue. The court reasoned as
follows:

In the opinion of the Court, if plaintiff had the capacity to sue, the Court
should hold that a) defendant Eastern Shipping Lines should pay plaintiff
the sum of P1,630.22 with interest at the legal rate from January 5, 1968,
the date of the institution of the Complaint, until fully paid; b) defendant
Angel Jose Transportation, Inc. should pay plaintiff the sum of P1,630.22
also with interest at the legal rate from January 5, 1968 until fully paid; c)
the counterclaim of defendant Angel Jose transportation, Inc. should be
ordered dismissed; and d) each defendant to pay one-half of the costs.

The Court is of the opinion that Section 68 of the Corporation Law reflects
a policy designed to protect the public interest. Hence, although
defendants have not raised the question of plaintiff's compliance with that
provision of law, the Court has resolved to take the matter into account.

A suing foreign corporation, like plaintiff, has to plead affirmatively and

prove either that the transaction upon which it bases its complaint is an
isolated one, or that it is licensed to transact business in this country,
failing which, it will be deemed that it has no valid cause of action (Atlantic
Mutual Ins. Co. vs. Cebu Stevedoring Co., Inc., 17 SCRA 1037). In view of
the number of cases filed by plaintiff before this Court, of which judicial
cognizance can be taken, and under the ruling in Far East International
Import and Export Corporation vs. Hankai Koayo Co., 6 SCRA 725, it has
to be held that plaintiff is doing business in the Philippines. Consequently,
it must have a license under Section 68 of the Corporation Law before it
can be allowed to sue.

The situation of plaintiff under said Section 68 has been described as

follows in Civil Case No. 71923 of this Court, entitled 'Home Insurance Co.
vs. N. V. Nedlloyd Lijnen, of which judicial cognizance can also be taken:

Exhibit "R",presented by plaintiff is a certified copy of a

license, dated July 1, 1967, issued by the Office of the
Insurance Commissioner authorizing plaintiff to transact
insurance business in this country. By virtue of Section 176
 of the Insurance Law, it has to be presumed that a license to
transact business under Section 68 of the Corporation Law
had previously been issued to plaintiff. No copy thereof,
however, was submitted for a reason unknown. The date of
that license must not have been much anterior to July 1,
1967. The preponderance of the evidence would therefore
call for the finding that the insurance contract involved in this
case, which was executed at Makati, Rizal, on February 8,
1967, was contracted before plaintiff was licensed to
transact business in the Philippines.

This Court views Section 68 of the Corporation Law as

reflective of a basic public policy. Hence, it is of the opinion
that, in the eyes of Philippine law, the insurance contract
involved in this case must be held void under the provisions
of Article 1409 (1) of the Civil Code, and could not be
validated by subsequent procurement of the license. That
view of the Court finds support in the following citation:

According to many authorities, a constitutional

or statutory prohibition against a foreign
corporation doing business in the state, unless
such corporation has complied with conditions
prescribed, is effective to make the contracts of
such corporation void, or at least
unenforceable, and prevents the maintenance
by the corporation of any action on such
contracts. Although the usual construction is to
the contrary, and to the effect that only the
remedy for enforcement is affected thereby, a
statute prohibiting a non-complying corporation
from suing in the state courts on any contract
has been held by some courts to render the
contract void and unenforceable by the
corporation, even after its has complied with
the statute." (36 Am. Jur. 2d 299-300).

xxx xxx xxx

The said Civil Case No. 71923 was dismissed by this Court. As the
insurance contract involved herein was executed on January 20, 1967, the
instant case should also be dismissed.

We resolved to consolidate the two cases when we gave due course to the petition.

The petitioner raised the following assignments of errors:

First Assignment of Error

 THE HONORABLE TRIAL COURT ERRED IN CONSIDERING AS AN
ISSUE THE LEGAL EXISTENCE OR CAPACITY OF PLAINTIFF-
APPELLANT.

Second Assignment of Error

THE HONORABLE TRIAL COURT ERRED IN DISMISSING THE

COMPLAINT ON THE FINDING THAT PLAINTIFF-APPELLANT HAS NO
CAPACITY TO SUE.

On the basis of factual and equitable considerations, there is no question that the
private respondents should pay the obligations found by the trial court as owing to the
petitioner. Only the question of validity of the contracts in relation to lack of capacity to
sue stands in the way of the petitioner being given the affirmative relief it seeks.
Whether or not the petitioner was engaged in single acts or solitary transactions and not
engaged in business is likewise not in issue. The petitioner was engaged in business
without a license. The private respondents' obligation to pay under the terms of the
contracts has been proved.

When the complaints in these two cases were filed, the petitioner had already secured
the necessary license to conduct its insurance business in the Philippines. It could
already filed suits.

Petitioner was, therefore, telling the truth when it averred in its complaints that it was a
foreign insurance company duly authorized to do business in the Philippines through its
agent Mr. Victor H. Bello. However, when the insurance contracts which formed the
basis of these cases were executed, the petitioner had not yet secured the necessary
licenses and authority. The lower court, therefore, declared that pursuant to the basic
public policy reflected in the Corporation Law, the insurance contracts executed before
a license was secured must be held null and void. The court ruled that the contracts
could not be validated by the subsequent procurement of the license.

The applicable provisions of the old Corporation Law, Act 1459, as amended are:

Sec. 68. No foreign corporation or corporations formed, organized, or

existing under any laws other than those of the Philippine Islands shall be
permitted to transact business in the Philippine Islands until after it shall
have obtained a license for that purpose from the chief of the Mercantile
Register of the Bureau of Commerce and Industry, (Now Securities and
Exchange Commission. See RA 5455) upon order of the Secretary of
Finance (Now Monetary Board) in case of banks, savings, and loan banks,
trust corporations, and banking institutions of all kinds, and upon order of
the Secretary of Commerce and Communications (Now Secretary of
Trade. See 5455, section 4 for other requirements) in case of all other
foreign corporations. ...

xxx xxx xxx

Sec. 69. No foreign corporation or corporation formed, organized, or

existing under any laws other than those of the Philippine Islands shall be
 permitted to transact business in the Philippine Islands or maintain by
itself or assignee any suit for the recovery of any debt, claim, or demand
whatever, unless it shall have the license prescribed in the section
immediately preceding. Any officer, director, or agent of the corporation or
any person transacting business for any foreign corporation not having the
license prescribed shag be punished by imprisonment for not less than six
months nor more than two years or by a fine of not less than two hundred
pesos nor more than one thousand pesos, or by both such imprisonment
and fine, in the discretion of the court.

As early as 1924, this Court ruled in the leading case of Marshall Wells Co. v. Henry W.
Elser & Co. (46 Phil. 70) that the object of Sections 68 and 69 of the Corporation Law
was to subject the foreign corporation doing business in the Philippines to the
jurisdiction of our courts. The Marshall Wells Co. decision referred to a litigation over an
isolated act for the unpaid balance on a bill of goods but the philosophy behind the law
applies to the factual circumstances of these cases. The Court stated:

xxx xxx xxx

Defendant isolates a portion of one sentence of section 69 of the

Corporation Law and asks the court to give it a literal meaning Counsel
would have the law read thus: "No foreign corporation shall be permitted
to maintain by itself or assignee any suit for the recovery of any debt,
claim, or demand whatever, unless it shall have the license prescribed in
section 68 of the law." Plaintiff, on the contrary, desires for the court to
consider the particular point under discussion with reference to all the law,
and thereafter to give the law a common sense interpretation.

The object of the statute was to subject the foreign corporation doing
business in the Philippines to the jurisdiction of its courts. The object of the
statute was not to prevent the foreign corporation from performing single
acts, but to prevent it from acquiring a domicile for the purpose of
business without taking the steps necessary to render it amenable to suit
in the local courts. The implication of the law is that it was never the
purpose of the Legislature to exclude a foreign corporation which happens
to obtain an isolated order for business from the Philippines, from securing
redress in the Philippine courts, and thus, in effect, to permit persons to
avoid their contracts made with such foreign corporations. The effect of
the statute preventing foreign corporations from doing business and from
bringing actions in the local courts, except on compliance with elaborate
requirements, must not be unduly extended or improperly applied. It
should not be construed to extend beyond the plain meaning of its terms,
considered in connection with its object, and in connection with the spirit of
the entire law. (State vs. American Book Co. [1904], 69 Kan, 1; American
De Forest Wireless Telegraph Co. vs. Superior Court of City & Country of
San Francisco and Hebbard [1908], 153 Cal., 533; 5 Thompson on
Corporations, 2d ed., chap. 184.)

Confronted with the option of giving to the Corporation Law a harsh

interpretation, which would disastrously embarrass trade, or of giving to
 the law a reasonable interpretation, which would markedly help in the
development of trade; confronted with the option of barring from the courts
foreign litigants with good causes of action or of assuming jurisdiction of
their cases; confronted with the option of construing the law to mean that
any corporation in the United States, which might want to sell to a person
in the Philippines must send some representative to the Islands before the
sale, and go through the complicated formulae provided by the
Corporation Law with regard to the obtaining of the license, before the
sale was made, in order to avoid being swindled by Philippine citizens, or
of construing the law to mean that no foreign corporation doing business
in the Philippines can maintain any suit until it shall possess the necessary
license;-confronted with these options, can anyone doubt what our
decision will be? The law simply means that no foreign corporation shall
be permitted "to transact business in the Philippine Islands," as this
phrase is known in corporation law, unless it shall have the license
required by law, and, until it complies with the law, shall not be permitted
to maintain any suit in the local courts. A contrary holding would bring the
law to the verge of unconstitutionality, a result which should be and can be
easily avoided. (Sioux Remedy Co. vs. Cope and Cope, supra; Perkins,
Philippine Business Law, p. 264.)

To repeat, the objective of the law was to subject the foreign corporation to the
jurisdiction of our courts. The Corporation Law must be given a reasonable, not an
unduly harsh, interpretation which does not hamper the development of trade relations
and which fosters friendly commercial intercourse among countries.

The objectives enunciated in the 1924 decision are even more relevant today when we
view commercial relations in terms of a world economy, when the tendency is to re-
examine the political boundaries separating one nation from another insofar as they
define business requirements or restrict marketing conditions.

We distinguish between the denial of a right to take remedial action and the penal
sanction for non-registration.

Insofar as transacting business without a license is concerned, Section 69 of the

Corporation Law imposed a penal sanction-imprisonment for not less than six months
nor more than two years or payment of a fine not less than P200.00 nor more than
P1,000.00 or both in the discretion of the court. There is a penalty for transacting
business without registration.

And insofar as litigation is concerned, the foreign corporation or its assignee may not
maintain any suit for the recovery of any debt, claim, or demand whatever. The
Corporation Law is silent on whether or not the contract executed by a foreign
corporation with no capacity to sue is null and void ab initio.

We are not unaware of the conflicting schools of thought both here and abroad which
are divided on whether such contracts are void or merely voidable. Professor Sulpicio
Guevarra in his book Corporation Law (Philippine Jurisprudence Series, U.P. Law
Center, pp. 233-234) cites an Illinois decision which holds the contracts void and a
Michigan statute and decision declaring them merely voidable:
xxx xxx xxx

Where a contract which is entered into by a foreign corporation without

complying with the local requirements of doing business is rendered void
either by the express terms of a statute or by statutory construction, a
subsequent compliance with the statute by the corporation will not enable
it to maintain an action on the contract. (Perkins Mfg. Co. v. Clinton Const.
Co., 295 P. 1 [1930]. See also Diamond Glue Co. v. U.S. Glue Co., supra
see note 18.) But where the statute merely prohibits the maintenance of a
suit on such contract (without expressly declaring the contract "void"), it
was held that a failure to comply with the statute rendered the contract
voidable and not void, and compliance at any time before suit was
sufficient. (Perkins Mfg. Co. v. Clinton Const. Co., supra.) Notwithstanding
the above decision, the Illinois statute provides, among other things that a
foreign corporation that fails to comply with the conditions of doing
business in that state cannot maintain a suit or action, etc. The court said:
'The contract upon which this suit was brought, having been entered into
in this state when appellant was not permitted to transact business in this
state, is in violation of the plain provisions of the statute, and is therefore
null and void, and no action can be maintained thereon at any time, even if
the corporation shall, at some time after the making of the contract, qualify
itself to transact business in this state by a compliance with our laws in
reference to foreign corporations that desire to engage in business here.
(United Lead Co. v. J.M. Ready Elevator Mfg. Co., 222 Ill. 199, 73 N.N.
567 [1906].)

A Michigan statute provides: "No foreign corporation subject to the

provisions of this Act, shall maintain any action in this state upon any
contract made by it in this state after the taking effect of this Act, until it
shall have fully complied with the requirement of this Act, and procured a
certificate to that effect from the Secretary of State," It was held that the
above statute does not render contracts of a foreign corporation that fails
to comply with the statute void, but they may be enforced only after
compliance therewith. (Hastings Industrial Co. v. Moral, 143 Mich. 679,107
N.E. 706 [1906]; Kuennan v. U.S. Fidelity & G. Co., Mich. 122; 123 N.W.
799 [1909]; Despres, Bridges & Noel v. Zierleyn, 163 Mich. 399, 128 N.W.
769 [1910]).

It has also been held that where the law provided that a corporation which
has not complied with the statutory requirements "shall not maintain an
action until such compliance". "At the commencement of this action the
plaintiff had not filed the certified copy with the country clerk of Madera
County, but it did file with the officer several months before the defendant
filed his amended answer, setting up this defense, as that at the time this
defense was pleaded by the defendant the plaintiff had complied with the
statute. The defense pleaded by the defendant was therefore unavailable
to him to prevent the plaintiff from thereafter maintaining the action.
Section 299 does not declare that the plaintiff shall not commence an
action in any county unless it has filed a certified copy in the office of the
county clerk, but merely declares that it shall not maintain an action until it
 has filled it. To maintain an action is not the same as to commence an
action, but implies that the action has already been commenced." (See
also Kendrick & Roberts Inc. v. Warren Bros. Co., 110 Md. 47, 72 A. 461
[1909]).

In another case, the court said: "The very fact that the prohibition against
maintaining an action in the courts of the state was inserted in the statute
ought to be conclusive proof that the legislature did not intend or
understand that contracts made without compliance with the law were
void. The statute does not fix any time within which foreign corporations
shall comply with the Act. If such contracts were void, no suits could be
prosecuted on them in any court. ... The primary purpose of our statute is
to compel a foreign corporation desiring to do business within the state to
submit itself to the jurisdiction of the courts of this state. The statute was
not intended to exclude foreign corporations from the state. It does not, in
terms, render invalid contracts made in this state by non-complying
corporations. The better reason, the wiser and fairer policy, and the
greater weight lie with those decisions which hold that where, as here,
there is a prohibition with a penalty, with no express or implied
declarations respecting the validity of enforceability of contracts made by
qualified foreign corporations, the contracts ... are enforceable ... upon
compliance with the law." (Peter & Burghard Stone Co. v. Carper, 172
N.E. 319 [1930].)

Our jurisprudence leans towards the later view. Apart from the objectives earlier cited
from Marshall Wells Co. v. Henry W. Elser & Co (supra), it has long been the rule that a
foreign corporation actually doing business in the Philippines without license to do so
may be sued in our courts. The defendant American corporation in General Corporation
of the Philippines v. Union Insurance Society of Canton Ltd et al. (87 Phil. 313) entered
into insurance contracts without the necessary license or authority. When summons
was served on the agent, the defendant had not yet been registered and authorized to
do business. The registration and authority came a little less than two months later. This
Court ruled:

Counsel for appellant contends that at the time of the service of summons,
the appellant had not yet been authorized to do business. But, as already
stated, section 14, Rule 7 of the Rules of Court makes no distinction as to
corporations with or without authority to do business in the Philippines.
The test is whether a foreign corporation was actually doing business
here. Otherwise, a foreign corporation illegally doing business here
because of its refusal or neglect to obtain the corresponding license and
authority to do business may successfully though unfairly plead such
neglect or illegal act so as to avoid service and thereby impugn the
jurisdiction of the local courts. It would indeed be anomalous and quite
prejudicial, even disastrous, to the citizens in this jurisdiction who in all
good faith and in the regular course of business accept and pay for
shipments of goods from America, relying for their protection on duly
executed foreign marine insurance policies made payable in Manila and
duly endorsed and delivered to them, that when they go to court to enforce
said policies, the insurer who all along has been engaging in this business
 of issuing similar marine policies, serenely pleads immunity to local
jurisdiction because of its refusal or neglect to obtain the corresponding
license to do business here thereby compelling the consignees or
purchasers of the goods insured to go to America and sue in its courts for
redress.

There is no question that the contracts are enforceable. The requirement of registration
affects only the remedy.

Significantly, Batas Pambansa Blg. 68, the Corporation Code of the Philippines has
corrected the ambiguity caused by the wording of Section 69 of the old Corporation
Law.

Section 133 of the present Corporation Code provides:

SEC. 133. Doing business without a license.-No foreign corporation

transacting business in the Philippines without a license, or its successors
or assigns, shag be permitted to maintain or intervene in any action, suit
or proceeding in any court or administrative agency in the Philippines; but
such corporation may be sued or proceeded against before Philippine
courts or administrative tribunals on any valid cause of action recognized
under Philippine laws.

The old Section 69 has been reworded in terms of non-access to courts and
administrative agencies in order to maintain or intervene in any action or proceeding.

The prohibition against doing business without first securing a license is now given
penal sanction which is also applicable to other violations of the Corporation Code
under the general provisions of Section 144 of the Code.

It is, therefore, not necessary to declare the contract nun and void even as against the
erring foreign corporation. The penal sanction for the violation and the denial of access
to our courts and administrative bodies are sufficient from the viewpoint of legislative
policy.

Our ruling that the lack of capacity at the time of the execution of the contracts was
cured by the subsequent registration is also strengthened by the procedural aspects of
these cases.

The petitioner averred in its complaints that it is a foreign insurance company, that it is
authorized to do business in the Philippines, that its agent is Mr. Victor H. Bello, and
that its office address is the Oledan Building at Ayala Avenue, Makati. These are all the
averments required by Section 4, Rule 8 of the Rules of Court. The petitioner sufficiently
alleged its capacity to sue. The private respondents countered either with an admission
of the plaintiff's jurisdictional averments or with a general denial based on lack of
knowledge or information sufficient to form a belief as to the truth of the averments.

We find the general denials inadequate to attack the foreign corporations lack of
capacity to sue in the light of its positive averment that it is authorized to do so. Section
4, Rule 8 requires that "a party desiring to raise an issue as to the legal existence of any
party or the capacity of any party to sue or be sued in a representative capacity shall do
so by specific denial, which shag include such supporting particulars as are particularly
within the pleader's knowledge. At the very least, the private respondents should have
stated particulars in their answers upon which a specific denial of the petitioner's
capacity to sue could have been based or which could have supported its denial for lack
of knowledge. And yet, even if the plaintiff's lack of capacity to sue was not properly
raised as an issue by the answers, the petitioner introduced documentary evidence that
it had the authority to engage in the insurance business at the time it filed the
complaints.

WHEREFORE, the petitions are hereby granted. The decisions of the respondent court
are reversed and set aside.

In L-34382, respondent Eastern Shipping Lines is ordered to pay the petitioner the sum
of P1,630.22 with interest at the legal rate from January 5, 1968 until fully paid and
respondent Angel Jose Transportation Inc. is ordered to pay the petitioner the sum of
P1,630.22 also with interest at the legal rate from January 5, 1968 until fully paid. Each
respondent shall pay one-half of the costs. The counterclaim of Angel Jose
Transportation Inc. is dismissed.

In L-34383, respondent N. V. Nedlloyd Lijnen, or its agent Columbian Phil. Inc. is

ordered to pay the petitioner the sum of P2,426.98 with interest at the legal rate from
February 1, 1968 until fully paid, the sum of P500.00 attorney's fees, and costs, The
complaint against Guacods, Inc. is dismissed.

SO ORDERED.

CONSTITUTION
G.R. No. 122156 February 3, 1997

MANILA PRINCE HOTEL petitioner,

vs.
GOVERNMENT SERVICE INSURANCE SYSTEM, MANILA HOTEL CORPORATION, COMMITTEE ON PRIVATIZATION and OFFICE OF
THE GOVERNMENT CORPORATE COUNSEL, respondents.

BELLOSILLO, J.:

The FiIipino First Policy enshrined in the 1987 Constitution, i.e., in the grant of rights, privileges, and concessions covering the national
economy and patrimony, the State shall give preference to qualified Filipinos,1 is in oked by petitioner in its bid to acquire 51% of the shares
of the Manila Hotel Corporation (MHC) which owns the historic Manila Hotel. Opposing, respondents maintain that the provision is not self-
executing but requires an implementing legislation for its enforcement. Corollarily, they ask whether the 51% shares form part of the national
economy and patrimony covered by the protective mantle of the Constitution.

The controversy arose when respondent Government Service Insurance System (GSIS), pursuant to the privatization program of the
Philippine Government under Proclamation No. 50 dated 8 December 1986, decided to sell through public bidding 30% to 51% of the issued
and outstanding shares of respondent MHC. The winning bidder, or the eventual "strategic partner," is to provide management expertise
and/or an international marketing/reservation system, and financial support to strengthen the profitability and performance of the Manila
Hotel.2 In a close bidding held on 18 September 1995 only two (2) bidders participated: petitioner 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.

Pertinent provisions of the bidding rules prepared by respondent GSIS state —

 I. EXECUTION OF THE NECESSARY CONTRACTS WITH GSIS/MHC —

1. The Highest Bidder must comply with the conditions set forth below by October 23, 1995 (reset to November 3,
1995) or the Highest Bidder will lose the right to purchase the Block of Shares and GSIS will instead offer the Block of
Shares to the other Qualified Bidders:

a. The Highest Bidder must negotiate and execute with the GSIS/MHC the Management
Contract, International Marketing/Reservation System Contract or other type of contract specified
by the Highest Bidder in its strategic plan for the Manila Hotel. . . .

b. The Highest Bidder must execute the Stock Purchase and Sale Agreement with GSIS . . . .

K. DECLARATION OF THE WINNING BIDDER/STRATEGIC PARTNER —

The Highest Bidder will be declared the Winning Bidder/Strategic Partner after the following conditions are met:

a. Execution of the necessary contracts with GSIS/MHC not later than October 23, 1995 (reset to
November 3, 1995); and

b. Requisite approvals from the GSIS/MHC and COP (Committee on Privatization)/OGCC (Office
of the Government Corporate Counsel) are obtained.3

Pending the declaration of Renong Berhad as the winning bidder/strategic partner and the execution of the necessary contracts, petitioner in
a letter to respondent GSIS dated 28 September 1995 matched the bid price of P44.00 per share tendered by Renong Berhad.4 In a
subsequent letter dated 10 October 1995 petitioner sent a manager's check issued by Philtrust Bank for Thirty-three Million Pesos
(P33.000.000.00) as Bid Security to match the bid of the Malaysian Group, Messrs. Renong Berhad . . .5 which respondent GSIS refused to
accept.

On 17 October 1995, perhaps apprehensive that respondent GSIS has disregarded the tender of the matching bid and that the sale of 51%
of the MHC may be hastened by respondent GSIS and consummated with Renong Berhad, petitioner came to this Court on prohibition and
mandamus. On 18 October 1995 the Court issued a temporary restraining order enjoining respondents from perfecting and consummating
the sale to the Malaysian firm.

On 10 September 1996 the instant case was accepted by the Court En Banc after it was referred to it by the First Division. The case was
then set for oral arguments with former Chief Justice Enrique M. Fernando and Fr. Joaquin G. Bernas, S.J., as amici curiae.

In the main, petitioner invokes Sec. 10, second par., Art. XII, of the 1987 Constitution and submits that the Manila Hotel has been identified
with the Filipino nation and has practically become a historical monument which reflects the vibrancy of Philippine heritage and culture. It is a
proud legacy of an earlier generation of Filipinos who believed in the nobility and sacredness of independence and its power and capacity to
release the full potential of the Filipino people. To all intents and purposes, it has become a part of the national patrimony.6 Petitioner also
argues that since 51% of the shares of the MHC carries with it the ownership of the business of the hotel which is owned by respondent
GSIS, a government-owned and controlled corporation, the hotel business of respondent GSIS being a part of the tourism industry is
unquestionably a part of the national economy. Thus, any transaction involving 51% of the shares of stock of the MHC is clearly covered by
the term national economy, to which Sec. 10, second par., Art. XII, 1987 Constitution, applies.7

It is also the thesis of petitioner that since Manila Hotel is part of the national patrimony and its business also unquestionably part of the
national economy petitioner should be preferred after it has matched the bid offer of the Malaysian firm. For the bidding rules mandate that if
for any reason, the Highest Bidder cannot be awarded the Block of Shares, GSIS may offer this to the other Qualified Bidders that have
validly submitted bids provided that these Qualified Bidders are willing to match the highest bid in terms of price per share.8

Respondents except. They maintain that: First, Sec. 10, second par., Art. XII, of the 1987 Constitution is merely a statement of principle and
policy since it is not a self-executing provision and requires implementing legislation(s) . . . Thus, for the said provision to Operate, there must
be existing laws "to lay down conditions under which business may be done."9

Second, granting that this provision is self-executing, Manila Hotel does not fall under the term national patrimony which only refers to lands
of the public domain, waters, minerals, coal, petroleum and other mineral oils, all forces of potential energy, fisheries, forests or timber,
wildlife, flora and fauna and all marine wealth in its territorial sea, and exclusive marine zone as cited in the first and second paragraphs of
Sec. 2, Art. XII, 1987 Constitution. According to respondents, while petitioner speaks of the guests who have slept in the hotel and the events
that have transpired therein which make the hotel historic, these alone do not make the hotel fall under the patrimony of the nation. What is
more, the mandate of the Constitution is addressed to the State, not to respondent GSIS which possesses a personality of its own separate
and distinct from the Philippines as a State.

Third, granting that the Manila Hotel forms part of the national patrimony, the constitutional provision invoked is still inapplicable since what is
being sold is only 51% of the outstanding shares of the corporation, not the hotel building nor the land upon which the building stands.
Certainly, 51% of the equity of the MHC cannot be considered part of the national patrimony. Moreover, if the disposition of the shares of the
MHC is really contrary to the Constitution, petitioner should have questioned it right from the beginning and not after it had lost in the bidding.

Fourth, the reliance by petitioner on par. V., subpar. J. 1., of the bidding rules which provides that if for any reason, the Highest Bidder cannot
be awarded the Block of Shares, GSIS may offer this to the other Qualified Bidders that have validly submitted bids provided that these
Qualified Bidders are willing to match the highest bid in terms of price per share, is misplaced. Respondents postulate that the privilege of
submitting a matching bid has not yet arisen since it only takes place if for any reason, the Highest Bidder cannot be awarded the Block of
Shares. Thus the submission by petitioner of a matching bid is premature since Renong Berhad could still very well be awarded the block of
shares and the condition giving rise to the exercise of the privilege to submit a matching bid had not yet taken place.

Finally, the prayer for prohibition grounded on grave abuse of discretion should fail since respondent GSIS did not exercise its discretion in a
capricious, whimsical manner, and if ever it did abuse its discretion it was not so patent and gross as to amount to an evasion of a positive
duty or a virtual refusal to perform a duty enjoined by law. Similarly, the petition for mandamus should fail as petitioner has no clear legal
right to what it demands and respondents do not have an imperative duty to perform the act required of them by petitioner.

We now resolve. A constitution is a system of fundamental laws for the governance and administration of a nation. It is supreme, imperious,
absolute and unalterable except by the authority from which it emanates. It has been defined as the fundamental and paramount law of the
nation. 10 It prescribes the permanent framework of a system of government, assigns to the different departments their respective powers
and duties, and establishes certain fixed principles on which government is founded. The fundamental conception in other words is that it is a
supreme law to which all other laws must conform and in accordance with which all private rights must be determined and all public authority
administered. 11 Under the doctrine of constitutional supremacy, if a law or contract violates any norm of the constitution that law or contract
whether promulgated by the legislative or by the executive branch or entered into by private persons for private purposes is null and void and
without any force and effect. Thus, since the Constitution is the fundamental, paramount and supreme law of the nation, it is deemed written
in every statute and contract.

Admittedly, some constitutions are merely declarations of policies and principles. Their provisions command the legislature to enact laws and
carry out the purposes of the framers who merely establish an outline of government providing for the different departments of the
governmental machinery and securing certain fundamental and inalienable rights of citizens. 12 A provision which lays down a general
principle, such as those found in Art. 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. 13

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.14 This can be cataclysmic. That is why the prevailing view is, as it has
always been, that —

. . . in case of doubt, the Constitution should be considered self-executing rather than non-self-executing . . . . Unless
the contrary is clearly intended, the provisions of the Constitution should be considered self-executing, as a contrary
rule would give the legislature discretion to determine when, or whether, they shall be effective. These provisions would
be subordinated to the will of the lawmaking body, which could make them entirely meaningless by simply refusing to
pass the needed implementing statute. 15

Respondents argue that Sec. 10, second par., Art. XII, of the 1987 Constitution is clearly not self-executing, as they quote from discussions
on the floor of the 1986 Constitutional Commission —

MR. RODRIGO. Madam President, I am asking this question as the Chairman of the Committee
on Style. If the wording of "PREFERENCE" is given to QUALIFIED FILIPINOS," can it be
understood as a preference to qualified Filipinos vis-a-vis Filipinos who are not qualified. So, why
do we not make it clear? To qualified Filipinos as against aliens?

THE PRESIDENT. What is the question of Commissioner Rodrigo? Is it to remove the word
"QUALIFIED?".

MR. RODRIGO. No, no, but say definitely "TO QUALIFIED FILIPINOS" as against whom? As
against aliens or over aliens?

MR. NOLLEDO. Madam President, I think that is understood. We use the word "QUALIFIED"
because the existing laws or prospective laws will always lay down conditions under which
business may be done. For example, qualifications on the setting up of other financial structures,
et cetera (emphasis supplied by respondents)

MR. RODRIGO. It is just a matter of style.

MR. NOLLEDO Yes, 16

Quite apparently, Sec. 10, second par., of Art XII is couched in such a way as not to make it appear that it is non-self-executing but simply for
purposes of style. But, certainly, the legislature is not precluded from enacting other further laws to enforce the constitutional provision so
long as the contemplated statute squares with the Constitution. Minor details may be left to the legislature without impairing the self-
executing nature of constitutional provisions.

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. 17 Subsequent legislation however does not necessarily
mean that the subject constitutional provision is not, by itself, fully enforceable.

Respondents also argue that the non-self-executing nature of Sec. 10, second par., of Art. XII is implied from the tenor of the first and third
paragraphs of the same section which undoubtedly are not self-executing. 18 The argument is flawed. If the first and third paragraphs are not
self-executing because Congress is still to enact measures to encourage the formation and operation of enterprises fully owned by Filipinos,
as in the first paragraph, and the State still needs legislation to regulate and exercise authority over foreign investments within its national
jurisdiction, as in the third paragraph, then a fortiori, by the same logic, the second paragraph can only be self-executing as it does not by its
language require any legislation in order to give preference to qualified Filipinos in the grant of rights, privileges and concessions covering
the national economy and patrimony. A constitutional provision may be self-executing in one part and non-self-executing in another. 19

Even the cases cited by respondents holding that certain constitutional provisions are merely statements of principles and policies, which are
basically not self-executing and only placed in the Constitution as moral incentives to legislation, not as judicially enforceable rights — are
simply not in point. Basco v. Philippine Amusements and Gaming Corporation 20 speaks of constitutional provisions on personal dignity, 21
the sanctity of family life, 22 the vital role of the youth in nation-building 23 the promotion of social justice, 24 and the values of education. 25
Tolentino v. Secretary of Finance 26 refers to the constitutional provisions on social justice and human rights 27 and on education. 28 Lastly,
Kilosbayan, Inc. v. Morato 29 cites provisions on the promotion of general welfare, 30 the sanctity of family life, 31 the vital role of the youth
in nation-building 32 and the promotion of total human liberation and development. 33 A reading of these provisions indeed clearly shows
that they are not judicially enforceable constitutional rights but merely guidelines for legislation. The very terms of the provisions manifest that
they are only principles upon which the legislations must be based. Res ipsa loquitur.

On the other hand, Sec. 10, second par., Art. XII of the 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. It is per se judicially enforceable When our Constitution mandates that [i]n the grant of rights, privileges,
and concessions covering national economy and patrimony, the State shall give preference to qualified Filipinos, it means just that —
qualified Filipinos shall be preferred. And when our Constitution declares that a right exists in certain specified circumstances an action may
be maintained to enforce such right notwithstanding the absence of any legislation on the subject; consequently, if there is no statute
especially enacted to enforce such constitutional right, such right enforces itself by its own inherent potency and puissance, and from which
all legislations must take their bearings. Where there is a right there is a remedy. Ubi jus ibi remedium.

As regards our national patrimony, a member of the 1986 Constitutional Commission 34 explains —

The patrimony of the Nation that should be conserved and developed refers not only to out rich natural resources but
also to the cultural heritage of out race. It also refers to our intelligence in arts, sciences and letters. Therefore, we
should develop not only our lands, forests, mines and other natural resources but also the mental ability or faculty of
our people.

We agree. In its plain and ordinary meaning, the term patrimony pertains to heritage. 35 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.

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, it immediately evolved to be truly Filipino, Formerly a concourse for the elite, it has since then become the venue of various
significant events which have shaped Philippine history. It was called the Cultural Center of the 1930's. It was the site of the festivities during
the inauguration of the Philippine Commonwealth. Dubbed as the Official Guest House of the Philippine Government. it plays host to
dignitaries and official visitors who are accorded the traditional Philippine hospitality. 36

The history of the hotel has been chronicled in the book The Manila Hotel: The Heart and Memory of a City. 37 During World War II the hotel
was converted by the Japanese Military Administration into a military headquarters. When the American forces returned to recapture Manila
the hotel was selected by the Japanese together with Intramuros as the two (2) places fro their final stand. Thereafter, in the 1950's and
1960's, the hotel became the center of political activities, playing host to almost every political convention. In 1970 the hotel reopened after a
renovation and reaped numerous international recognitions, an acknowledgment of the Filipino talent and ingenuity. In 1986 the hotel was
the site of a failed coup d' etat where an aspirant for vice-president was "proclaimed" President of the Philippine Republic.

For more than eight (8) decades Manila Hotel has bore mute witness to the triumphs and failures, loves and frustrations of the Filipinos; its
existence is impressed with public interest; its own historicity associated with our struggle for sovereignty, independence and nationhood.
Verily, Manila Hotel has become part of our national economy and patrimony. For sure, 51% of the equity of the MHC comes within the
purview of the constitutional shelter for it comprises the majority and controlling stock, so that anyone who acquires or owns the 51% will
have actual control and management of the hotel. In this instance, 51% of the MHC cannot be disassociated from the hotel and the land on
which the hotel edifice stands. Consequently, we cannot sustain respondents' claim that the Filipino First Policy provision is not applicable
since what is being sold is only 51% of the outstanding shares of the corporation, not the Hotel building nor the land upon which the building
stands. 38

The argument is pure sophistry. The term qualified Filipinos as used in Our Constitution also includes corporations at least 60% of which is
owned by Filipinos. This is very clear from the proceedings of the 1986 Constitutional Commission

THE PRESIDENT. Commissioner Davide is recognized.

 MR. DAVIDE. I would like to introduce an amendment to the Nolledo amendment. And the
amendment would consist in substituting the words "QUALIFIED FILIPINOS" with the following:
"CITIZENS OF THE PHILIPPINES OR CORPORATIONS OR ASSOCIATIONS WHOSE
CAPITAL OR CONTROLLING STOCK IS WHOLLY OWNED BY SUCH CITIZENS.

xxx xxx xxx

MR. MONSOD. Madam President, apparently the proponent is agreeable, but we have to raise a
question. Suppose it is a corporation that is 80-percent Filipino, do we not give it preference?

MR. DAVIDE. The Nolledo amendment would refer to an individual Filipino. What about a
corporation wholly owned by Filipino citizens?

MR. MONSOD. At least 60 percent, Madam President.

MR. DAVIDE. Is that the intention?

MR. MONSOD. Yes, because, in fact, we would be limiting it if we say that the preference should
only be 100-percent Filipino.

MR: DAVIDE. I want to get that meaning clear because "QUALIFIED FILIPINOS" may refer only
to individuals and not to juridical personalities or entities.

MR. MONSOD. We agree, Madam President. 39

xxx xxx xxx

MR. RODRIGO. Before we vote, may I request that the amendment be read again.

MR. NOLLEDO. The amendment will read: "IN THE GRANT OF RIGHTS, PRIVILEGES AND
CONCESSIONS COVERING THE NATIONAL ECONOMY AND PATRIMONY, THE STATE
SHALL GIVE PREFERENCE TO QUALIFIED FILIPINOS." And the word "Filipinos" here, as
intended by the proponents, will include not only individual Filipinos but also Filipino-controlled
entities or entities fully-controlled by Filipinos. 40

The phrase preference to qualified Filipinos was explained thus —

MR. FOZ. Madam President, I would like to request Commissioner Nolledo to please restate his
amendment so that I can ask a question.

MR. NOLLEDO. "IN THE GRANT OF RIGHTS, PRIVILEGES AND CONCESSIONS COVERING
THE NATIONAL ECONOMY AND PATRIMONY, THE STATE SHALL GIVE PREFERENCE TO
QUALIFIED FILIPINOS."

MR FOZ. In connection with that amendment, if a foreign enterprise is qualified and a Filipino
enterprise is also qualified, will the Filipino enterprise still be given a preference?

MR. NOLLEDO. Obviously.

MR. FOZ. If the foreigner is more qualified in some aspects than the Filipino enterprise, will the
Filipino still be preferred?

MR. NOLLEDO. The answer is "yes."

MR. FOZ. Thank you, 41

Expounding further on the Filipino First Policy provision Commissioner Nolledo continues —

MR. NOLLEDO. Yes, Madam President. Instead of "MUST," it will be "SHALL — THE STATE SHALL GlVE
PREFERENCE TO QUALIFIED FILIPINOS. This embodies the so-called "Filipino First" policy. That means that
Filipinos should be given preference in the grant of concessions, privileges and rights covering the national patrimony.
42

The exchange of views in the sessions of the Constitutional Commission regarding the subject provision was still further clarified by
Commissioner Nolledo 43 —
 Paragraph 2 of Section 10 explicitly mandates the "Pro-Filipino" bias in all economic concerns. It is better known as the
FILIPINO FIRST Policy . . . This provision was never found in previous Constitutions . . . .

The term "qualified Filipinos" simply means that preference shall be given to those citizens who can make a viable
contribution to the common good, because of credible competence and efficiency. It certainly does NOT mandate the
pampering and preferential treatment to Filipino citizens or organizations that are incompetent or inefficient, since such
an indiscriminate preference would be counter productive and inimical to the common good.

In the granting of economic rights, privileges, and concessions, when a choice has to be made between a "qualified
foreigner" end a "qualified Filipino," the latter shall be chosen over the former."

Lastly, the word qualified is also determinable. Petitioner was so considered by respondent GSIS and selected as one of the qualified
bidders. It was pre-qualified by respondent GSIS in accordance with its own guidelines so that the sole inference here is that petitioner has
been found to be possessed of proven management expertise in the hotel industry, or it has significant equity ownership in another hotel
company, or it has an overall management and marketing proficiency to successfully operate the Manila Hotel. 44

The penchant to try to whittle away the mandate of the Constitution by arguing that the subject provision is not self-executory and requires
implementing legislation is quite disturbing. The attempt to violate a clear constitutional provision — by the government itself — is only too
distressing. To adopt such a line of reasoning is to renounce the duty to ensure faithfulness to the Constitution. For, even some of the
provisions of the Constitution which evidently need implementing legislation have juridical life of their own and can be the source of a judicial
remedy. We cannot simply afford the government a defense that arises out of the failure to enact further enabling, implementing or guiding
legislation. In fine, the discourse of Fr. Joaquin G. Bernas, S.J., on constitutional government is apt —

The executive department has a constitutional duty to implement laws, including the Constitution, even before
Congress acts — provided that there are discoverable legal standards for executive action. When the executive acts, it
must be guided by its own understanding of the constitutional command and of applicable laws. The responsibility for
reading and understanding the Constitution and the laws is not the sole prerogative of Congress. If it were, the
executive would have to ask Congress, or perhaps the Court, for an interpretation every time the executive is
confronted by a constitutional command. That is not how constitutional government operates. 45

Respondents further argue that the constitutional provision is addressed to the State, not to respondent GSIS which by itself possesses a
separate and distinct personality. This argument again is at best specious. It is undisputed that the sale of 51% of the MHC could only be
carried out with the prior approval of the State acting through respondent Committee on Privatization. As correctly pointed out by Fr. Joaquin
G. Bernas, S.J., this fact alone makes the sale of the assets of respondents GSIS and MHC a "state action." In constitutional jurisprudence,
the acts of persons distinct from the government are considered "state action" covered by the Constitution (1) when the activity it engages in
is a "public function;" (2) when the government is so significantly involved with the private actor as to make the government responsible for
his action; and, (3) when the government has approved or authorized the action. It is evident that the act of respondent GSIS in selling 51%
of its share in respondent MHC comes under the second and third categories of "state action." Without doubt therefore the transaction.
although entered into by respondent GSIS, is in fact a transaction of the State and therefore subject to the constitutional command. 46

When the Constitution addresses the State it refers not only to the people but also to the government as elements of the State. After all,
government is composed of three (3) divisions of power — legislative, executive and judicial. Accordingly, a constitutional mandate directed
to the State is correspondingly directed to the three(3) branches of government. It is undeniable that in this case the subject constitutional
injunction is addressed among others to the Executive Department and respondent GSIS, a government instrumentality deriving its authority
from the State.

It should be stressed that while the Malaysian firm offered the higher bid it is not yet the winning bidder. The bidding rules expressly provide
that the highest bidder shall only be declared the winning bidder after it has negotiated and executed the necessary contracts, and secured
the requisite approvals. Since the "Filipino First Policy provision of the Constitution bestows preference on qualified Filipinos the mere
tending of the highest bid is not an assurance that the highest bidder will be declared the winning bidder. Resultantly, respondents are not
bound to make the award yet, nor are they under obligation to enter into one with the highest bidder. For in choosing the awardee
respondents are mandated to abide by the dictates of the 1987 Constitution the provisions of which are presumed to be known to all the
bidders and other interested parties.

Adhering to the doctrine of constitutional supremacy, the subject constitutional provision is, as it should be, impliedly written in the bidding
rules issued by respondent GSIS, lest the bidding rules be nullified for being violative of the Constitution. It is a basic principle in
constitutional law that all laws and contracts must conform with the fundamental law of the land. Those which violate the Constitution lose
their reason for being.

Paragraph V. J. 1 of the bidding rules provides that [if] for any reason the Highest Bidder cannot be awarded the Block of Shares, GSIS may
offer this to other Qualified Bidders that have validly submitted bids provided that these Qualified Bidders are willing to match the highest bid
in terms of price per
share. 47 Certainly, the constitutional mandate itself is reason enough not to award the block of shares immediately to the foreign bidder
notwithstanding its submission of a higher, or even the highest, bid. In fact, we cannot conceive of a stronger reason than the constitutional
injunction itself.

In the instant case, where a foreign firm submits the highest bid in a public bidding concerning the grant of rights, privileges and concessions
covering the national economy and patrimony, thereby exceeding the bid of a Filipino, there is no question that the Filipino will have to be
allowed to match the bid of the foreign entity. And if the Filipino matches the bid of a foreign firm the award should go to the Filipino. It must
be so if we are to give life and meaning to the Filipino First Policy provision of the 1987 Constitution. For, while this may neither be expressly
stated nor contemplated in the bidding rules, the constitutional fiat is, omnipresent to be simply disregarded. To ignore it would be to sanction
a perilous skirting of the basic law.
This Court does not discount the apprehension that this policy may discourage foreign investors. But the Constitution and laws of the
Philippines are understood to be always open to public scrutiny. These are given factors which investors must consider when venturing into
business in a foreign jurisdiction. Any person therefore desiring to do business in the Philippines or with any of its agencies or
instrumentalities is presumed to know his rights and obligations under the Constitution and the laws of the forum.

The argument of respondents that petitioner is now estopped from questioning the sale to Renong Berhad since petitioner was well aware
from the beginning that a foreigner could participate in the bidding is meritless. Undoubtedly, Filipinos and foreigners alike were invited to the
bidding. But foreigners may be awarded the sale only if no Filipino qualifies, or if the qualified Filipino fails to match the highest bid tendered
by the foreign entity. In the case before us, while petitioner was already preferred at the inception of the bidding because of the constitutional
mandate, petitioner had not yet matched the bid offered by Renong Berhad. Thus it did not have the right or personality then to compel
respondent GSIS to accept its earlier bid. Rightly, only after it had matched the bid of the foreign firm and the apparent disregard by
respondent GSIS of petitioner's matching bid did the latter have a cause of action.

Besides, there is no time frame for invoking the constitutional safeguard unless perhaps the award has been finally made. To insist on selling
the Manila Hotel to foreigners when there is a Filipino group willing to match the bid of the foreign group is to insist that government be
treated as any other ordinary market player, and bound by its mistakes or gross errors of judgment, regardless of the consequences to the
Filipino people. The miscomprehension of the Constitution is regrettable. Thus we would rather remedy the indiscretion while there is still an
opportunity to do so than let the government develop the habit of forgetting that the Constitution lays down the basic conditions and
parameters for its actions.

Since petitioner has already matched the bid price tendered by Renong Berhad pursuant to the bidding rules, respondent GSIS is left with no
alternative but to award to petitioner the block of shares of MHC and to execute the necessary agreements and documents to effect the sale
in accordance not only with the bidding guidelines and procedures but with the Constitution as well. The refusal of respondent GSIS to
execute the corresponding documents with petitioner as provided in the bidding rules after the latter has matched the bid of the Malaysian
firm clearly constitutes grave abuse of discretion.

The Filipino First Policy is a product of Philippine nationalism. It is embodied in the 1987 Constitution not merely to be used as a guideline for
future legislation but primarily to be enforced; so must it be enforced. This Court as the ultimate guardian of the Constitution will never shun,
under any reasonable circumstance, the duty of upholding the majesty of the Constitution which it is tasked to defend. It is worth
emphasizing that it is not the intention of this Court to impede and diminish, much less undermine, the influx of foreign investments. Far from
it, the Court encourages and welcomes more business opportunities but avowedly sanctions the preference for Filipinos whenever such
preference is ordained by the Constitution. The position of the Court on this matter could have not been more appropriately articulated by
Chief Justice Narvasa —

As scrupulously as it has tried to observe that it is not its function to substitute its judgment for that of the legislature or
the executive about the wisdom and feasibility of legislation economic in nature, the Supreme Court has not been
spared criticism for decisions perceived as obstacles to economic progress and development . . . in connection with a
temporary injunction issued by the Court's First Division against the sale of the Manila Hotel to a Malaysian Firm and its
partner, certain statements were published in a major daily to the effect that injunction "again demonstrates that the
Philippine legal system can be a major obstacle to doing business here.

Let it be stated for the record once again that while it is no business of the Court to intervene in contracts of the kind
referred to or set itself up as the judge of whether they are viable or attainable, it is its bounden duty to make sure that
they do not violate the Constitution or the laws, or are not adopted or implemented with grave abuse of discretion
amounting to lack or excess of jurisdiction. It will never shirk that duty, no matter how buffeted by winds of unfair and ill-
informed criticism. 48

Privatization of a business asset for purposes of enhancing its business viability and preventing further losses, regardless of the character of
the asset, should not take precedence over non-material values. A commercial, nay even a budgetary, objective should not be pursued at the
expense of national pride and dignity. For the Constitution enshrines higher and nobler non-material values. Indeed, the Court will always
defer to the Constitution in the proper governance of a free society; after all, there is nothing so sacrosanct in any economic policy as to draw
itself beyond judicial review when the Constitution is involved. 49

Nationalism is inherent, in the very concept of the Philippines being a democratic and republican state, with sovereignty residing in the
Filipino people and from whom all government authority emanates. In nationalism, the happiness and welfare of the people must be the goal.
The nation-state can have no higher purpose. Any interpretation of any constitutional provision must adhere to such basic concept.
Protection of foreign investments, while laudible, is merely a policy. It cannot override the demands of nationalism. 50

The Manila Hotel or, for that matter, 51% of the MHC, is not just any commodity to be sold to the highest bidder solely for the sake of
privatization. We are not talking about an ordinary piece of property in a commercial district. We are talking about a historic relic that has
hosted many of the most important events in the short history of the Philippines as a nation. We are talking about a hotel where heads of
states would prefer to be housed as a strong manifestation of their desire to cloak the dignity of the highest state function to their official visits
to the Philippines. Thus the Manila Hotel has played and continues to play a significant role as an authentic repository of twentieth century
Philippine history and culture. In this sense, it has become truly a reflection of the Filipino soul — a place with a history of grandeur; a most
historical setting that has played a part in the shaping of a country. 51

This Court cannot extract rhyme nor reason from the determined efforts of respondents to sell the historical landmark — this Grand Old
Dame of hotels in Asia — to a total stranger. For, indeed, the conveyance of this epic exponent of the Filipino psyche to alien hands cannot
be less than mephistophelian for it is, in whatever manner viewed, a veritable alienation of a nation's soul for some pieces of foreign silver.
And so we ask: What advantage, which cannot be equally drawn from a qualified Filipino, can be gained by the Filipinos Manila Hotel — and
all that it stands for — is sold to a non-Filipino? How much of national pride will vanish if the nation's cultural heritage is entrusted to a foreign
entity? On the other hand, how much dignity will be preserved and realized if the national patrimony is safekept in the hands of a qualified,
zealous and well-meaning Filipino? This is the plain and simple meaning of the Filipino First Policy provision of the Philippine Constitution.
And this Court, heeding the clarion call of the Constitution and accepting the duty of being the elderly watchman of the nation, will continue to
respect and protect the sanctity of the Constitution.

WHEREFORE, respondents GOVERNMENT SERVICE INSURANCE SYSTEM, MANILA HOTEL CORPORATION, COMMITTEE ON
PRIVATIZATION and OFFICE OF THE GOVERNMENT CORPORATE COUNSEL are directed to CEASE and DESIST from selling 51% of
the shares of the Manila Hotel Corporation to RENONG BERHAD, and to ACCEPT the matching bid of petitioner MANILA PRINCE HOTEL
CORPORATION to purchase the subject 51% of the shares of the Manila Hotel Corporation at P44.00 per share and thereafter to execute
the necessary clearances and to do such other acts and deeds as may be necessary for purpose.

SO ORDERED.

G.R. No. 160261 November 10, 2003

ERNESTO B. FRANCISCO, JR., petitioner,

NAGMAMALASAKIT NA MGA MANANANGGOL NG MGA MANGGAGAWANG
PILIPINO, INC., ITS OFFICERS AND MEMBERS, petitioner-in-intervention,
WORLD WAR II VETERANS LEGIONARIES OF THE PHILIPPINES, INC., petitioner-
in-intervention,
vs.
THE HOUSE OF REPRESENTATIVES, REPRESENTED BY SPEAKER JOSE G. DE
VENECIA, THE SENATE, REPRESENTED BY SENATE PRESIDENT FRANKLIN M.
DRILON, REPRESENTATIVE GILBERTO C. TEODORO, JR. AND
REPRESENTATIVE FELIX WILLIAM B. FUENTEBELLA, respondents.
JAIME N. SORIANO, respondent-in-Intervention,
SENATOR AQUILINO Q. PIMENTEL, respondent-in-intervention.

CARPIO MORALES, J.:

There can be no constitutional crisis arising from a conflict, no matter how passionate and
seemingly irreconcilable it may appear to be, over the determination by the independent branches
of government of the nature, scope and extent of their respective constitutional powers where the
Constitution itself provides for the means and bases for its resolution.

Our nation's history is replete with vivid illustrations of the often frictional, at times turbulent,
dynamics of the relationship among these co-equal branches. This Court is confronted with one
such today involving the legislature and the judiciary which has drawn legal luminaries to chart
antipodal courses and not a few of our countrymen to vent cacophonous sentiments thereon.

There may indeed be some legitimacy to the characterization that the present controversy subject
of the instant petitions – whether the filing of the second impeachment complaint against Chief
Justice Hilario G. Davide, Jr. with the House of Representatives falls within the one year bar
provided in the Constitution, and whether the resolution thereof is a political question – has
resulted in a political crisis. Perhaps even more truth to the view that it was brought upon by a
political crisis of conscience.

In any event, it is with the absolute certainty that our Constitution is sufficient to address all the
issues which this controversy spawns that this Court unequivocally pronounces, at the first
instance, that the feared resort to extra-constitutional methods of resolving it is neither necessary
nor legally permissible. Both its resolution and protection of the public interest lie in adherence
to, not departure from, the Constitution.

In passing over the complex issues arising from the controversy, this Court is ever mindful of the
essential truth that the inviolate doctrine of separation of powers among the legislative, executive
or judicial branches of government by no means prescribes for absolute autonomy in the
discharge by each of that part of the governmental power assigned to it by the sovereign people.

At the same time, the corollary doctrine of checks and balances which has been carefully
calibrated by the Constitution to temper the official acts of each of these three branches must be
given effect without destroying their indispensable co-equality.

Taken together, these two fundamental doctrines of republican government, intended as they are
to insure that governmental power is wielded only for the good of the people, mandate a
relationship of interdependence and coordination among these branches where the delicate
functions of enacting, interpreting and enforcing laws are harmonized to achieve a unity of
governance, guided only by what is in the greater interest and well-being of the people. Verily,
salus populi est suprema lex.

Article XI of our present 1987 Constitution provides:

ARTICLE XI

Accountability of Public Officers

SECTION 1. Public office is a public trust. Public officers and employees must at all
times be accountable to the people, serve them with utmost responsibility, integrity,
loyalty, and efficiency, act with patriotism and justice, and lead modest lives.

SECTION 2. The President, the Vice-President, the Members of the Supreme Court, the
Members of the Constitutional Commissions, and the Ombudsman may be removed from
office, on impeachment for, and conviction of, culpable violation of the Constitution,
treason, bribery, graft and corruption, other high crimes, or betrayal of public trust. All
other public officers and employees may be removed from office as provided by law, but
not by impeachment.

SECTION 3. (1) The House of Representatives shall have the exclusive power to initiate
all cases of impeachment.

(2) A verified complaint for impeachment may be filed by any Member of the House of
Representatives or by any citizen upon a resolution of endorsement by any Member
thereof, which shall be included in the Order of Business within ten session days, and
referred to the proper Committee within three session days thereafter. The Committee,
after hearing, and by a majority vote of all its Members, shall submit its report to the
House within sixty session days from such referral, together with the corresponding
resolution. The resolution shall be calendared for consideration by the House within ten
session days from receipt thereof.
 (3) A vote of at least one-third of all the Members of the House shall be necessary either
to affirm a favorable resolution with the Articles of Impeachment of the Committee, or
override its contrary resolution. The vote of each Member shall be recorded.

(4) In case the verified complaint or resolution of impeachment is filed by at least one-
third of all the Members of the House, the same shall constitute the Articles of
Impeachment, and trial by the Senate shall forthwith proceed.

(5) No impeachment proceedings shall be initiated against the same official more than
once within a period of one year.

(6) The Senate shall have the sole power to try and decide all cases of impeachment.
When sitting for that purpose, the Senators shall be on oath or affirmation. When the
President of the Philippines is on trial, the Chief Justice of the Supreme Court shall
preside, but shall not vote. No person shall be convicted without the concurrence of two-
thirds of all the Members of the Senate.

(7) Judgment in cases of impeachment shall not extend further than removal from office
and disqualification to hold any office under the Republic of the Philippines, but the party
convicted shall nevertheless be liable and subject to prosecution, trial, and punishment
according to law.

(8) The Congress shall promulgate its rules on impeachment to effectively carry out the
purpose of this section. (Emphasis and underscoring supplied)

Following the above-quoted Section 8 of Article XI of the Constitution, the 12th Congress of the
House of Representatives adopted and approved the Rules of Procedure in Impeachment
Proceedings (House Impeachment Rules) on November 28, 2001, superseding the previous
House Impeachment Rules1 approved by the 11th Congress. The relevant distinctions between
these two Congresses' House Impeachment Rules are shown in the following tabulation:

11TH CONGRESS RULES 12TH CONGRESS NEW

RULES

RULE II RULE V

INITIATING IMPEACHMENT BAR AGAINST INITIATION

OF IMPEACHMENT
Section 2. Mode of Initiating PROCEEDINGS AGAINST
Impeachment. – Impeachment THE SAME OFFICIAL
shall be initiated only by a verified
complaint for impeachment filed Section 16. – Impeachment
by any Member of the House of Proceedings Deemed Initiated. –
Representatives or by any citizen In cases where a Member of the
upon a resolution of endorsement House files a verified complaint
by any Member thereof or by a of impeachment or a citizen files
verified complaint or resolution of a verified complaint that is
impeachment filed by at least one- endorsed by a Member of the
House through a resolution of
 third (1/3) of all the Members of endorsement against an
the House. impeachable officer,
impeachment proceedings against
such official are deemed initiated
on the day the Committee on
Justice finds that the verified
complaint and/or resolution
against such official, as the case
may be, is sufficient in substance,
or on the date the House votes to
overturn or affirm the finding of
the said Committee that the
verified complaint and/or
resolution, as the case may be, is
not sufficient in substance.

In cases where a verified

complaint or a resolution of
impeachment is filed or endorsed,
as the case may be, by at least
one-third (1/3) of the Members of
the House, impeachment
proceedings are deemed
initiated at the time of the filing
of such verified complaint or
resolution of impeachment with
the Secretary General.

RULE V Section 17. Bar Against

Initiation Of Impeachment
BAR AGAINST Proceedings. – Within a period
IMPEACHMENT of one (1) year from the date
impeachment proceedings are
Section 14. Scope of Bar. – No deemed initiated as provided in
impeachment proceedings shall be Section 16 hereof, no
initiated against the same official impeachment proceedings, as
more than once within the period such, can be initiated against the
of one (1) year. same official. (Italics in the
original; emphasis and
underscoring supplied)

On July 22, 2002, the House of Representatives adopted a Resolution,2 sponsored by

Representative Felix William D. Fuentebella, which directed the Committee on Justice "to
conduct an investigation, in aid of legislation, on the manner of disbursements and expenditures
by the Chief Justice of the Supreme Court of the Judiciary Development Fund (JDF)."3
On June 2, 2003, former President Joseph E. Estrada filed an impeachment complaint4 (first
impeachment complaint) against Chief Justice Hilario G. Davide Jr. and seven Associate
Justices5 of this Court for "culpable violation of the Constitution, betrayal of the public trust and
other high crimes."6 The complaint was endorsed by Representatives Rolex T. Suplico, Ronaldo
B. Zamora and Didagen Piang Dilangalen,7 and was referred to the House Committee on Justice
on August 5, 20038 in accordance with Section 3(2) of Article XI of the Constitution which
reads:

Section 3(2) A verified complaint for impeachment may be filed by any Member of the
House of Representatives or by any citizen upon a resolution of endorsement by any
Member thereof, which shall be included in the Order of Business within ten session
days, and referred to the proper Committee within three session days thereafter. The
Committee, after hearing, and by a majority vote of all its Members, shall submit its
report to the House within sixty session days from such referral, together with the
corresponding resolution. The resolution shall be calendared for consideration by the
House within ten session days from receipt thereof.

The House Committee on Justice ruled on October 13, 2003 that the first impeachment
complaint was "sufficient in form,"9 but voted to dismiss the same on October 22, 2003 for being
insufficient in substance.10 To date, the Committee Report to this effect has not yet been sent to
the House in plenary in accordance with the said Section 3(2) of Article XI of the Constitution.

Four months and three weeks since the filing on June 2, 2003 of the first complaint or on
October 23, 2003, a day after the House Committee on Justice voted to dismiss it, the second
impeachment complaint11 was filed with the Secretary General of the House12 by Representatives
Gilberto C. Teodoro, Jr. (First District, Tarlac) and Felix William B. Fuentebella (Third District,
Camarines Sur) against Chief Justice Hilario G. Davide, Jr., founded on the alleged results of the
legislative inquiry initiated by above-mentioned House Resolution. This second impeachment
complaint was accompanied by a "Resolution of Endorsement/Impeachment" signed by at least
one-third (1/3) of all the Members of the House of Representatives.13

Thus arose the instant petitions against the House of Representatives, et. al., most of which
petitions contend that the filing of the second impeachment complaint is unconstitutional as it
violates the provision of Section 5 of Article XI of the Constitution that "[n]o impeachment
proceedings shall be initiated against the same official more than once within a period of one
year."

In G.R. No. 160261, petitioner Atty. Ernesto B. Francisco, Jr., alleging that he has a duty as a
member of the Integrated Bar of the Philippines to use all available legal remedies to stop an
unconstitutional impeachment, that the issues raised in his petition for Certiorari, Prohibition and
Mandamus are of transcendental importance, and that he "himself was a victim of the capricious
and arbitrary changes in the Rules of Procedure in Impeachment Proceedings introduced by the
12th Congress,"14 posits that his right to bring an impeachment complaint against then
Ombudsman Aniano Desierto had been violated due to the capricious and arbitrary changes in
the House Impeachment Rules adopted and approved on November 28, 2001 by the House of
Representatives and prays that (1) Rule V, Sections 16 and 17 and Rule III, Sections 5, 6, 7, 8,
and 9 thereof be declared unconstitutional; (2) this Court issue a writ of mandamus directing
respondents House of Representatives et. al. to comply with Article IX, Section 3 (2), (3) and (5)
of the Constitution, to return the second impeachment complaint and/or strike it off the records
of the House of Representatives, and to promulgate rules which are consistent with the
Constitution; and (3) this Court permanently enjoin respondent House of Representatives from
proceeding with the second impeachment complaint.

In G.R. No. 160262, petitioners Sedfrey M. Candelaria, et. al., as citizens and taxpayers, alleging
that the issues of the case are of transcendental importance, pray, in their petition for
Certiorari/Prohibition, the issuance of a writ "perpetually" prohibiting respondent House of
Representatives from filing any Articles of Impeachment against the Chief Justice with the
Senate; and for the issuance of a writ "perpetually" prohibiting respondents Senate and Senate
President Franklin Drilon from accepting any Articles of Impeachment against the Chief Justice
or, in the event that the Senate has accepted the same, from proceeding with the impeachment
trial.

In G.R. No. 160263, petitioners Arturo M. de Castro and Soledad Cagampang, as citizens,
taxpayers, lawyers and members of the Integrated Bar of the Philippines, alleging that their
petition for Prohibition involves public interest as it involves the use of public funds necessary to
conduct the impeachment trial on the second impeachment complaint, pray for the issuance of a
writ of prohibition enjoining Congress from conducting further proceedings on said second
impeachment complaint.

In G.R. No. 160277, petitioner Francisco I. Chavez, alleging that this Court has recognized that
he has locus standi to bring petitions of this nature in the cases of Chavez v. PCGG15 and Chavez
v. PEA-Amari Coastal Bay Development Corporation,16 prays in his petition for Injunction that
the second impeachment complaint be declared unconstitutional.

In G.R. No. 160292, petitioners Atty. Harry L. Roque, et. al., as taxpayers and members of the
legal profession, pray in their petition for Prohibition for an order prohibiting respondent House
of Representatives from drafting, adopting, approving and transmitting to the Senate the second
impeachment complaint, and respondents De Venecia and Nazareno from transmitting the
Articles of Impeachment to the Senate.

In G.R. No. 160295, petitioners Representatives Salacnib F. Baterina and Deputy Speaker Raul
M. Gonzalez, alleging that, as members of the House of Representatives, they have a legal
interest in ensuring that only constitutional impeachment proceedings are initiated, pray in their
petition for Certiorari/Prohibition that the second impeachment complaint and any act
proceeding therefrom be declared null and void.

In G.R. No. 160310, petitioners Leonilo R. Alfonso et al., claiming that they have a right to be
protected against all forms of senseless spending of taxpayers' money and that they have an
obligation to protect the Supreme Court, the Chief Justice, and the integrity of the Judiciary,
allege in their petition for Certiorari and Prohibition that it is instituted as "a class suit" and pray
that (1) the House Resolution endorsing the second impeachment complaint as well as all
issuances emanating therefrom be declared null and void; and (2) this Court enjoin the Senate
and the Senate President from taking cognizance of, hearing, trying and deciding the second
impeachment complaint, and issue a writ of prohibition commanding the Senate, its prosecutors
and agents to desist from conducting any proceedings or to act on the impeachment complaint.

In G.R. No. 160318, petitioner Public Interest Center, Inc., whose members are citizens and
taxpayers, and its co-petitioner Crispin T. Reyes, a citizen, taxpayer and a member of the
Philippine Bar, both allege in their petition, which does not state what its nature is, that the filing
of the second impeachment complaint involves paramount public interest and pray that Sections
16 and 17 of the House Impeachment Rules and the second impeachment complaint/Articles of
Impeachment be declared null and void.

In G.R. No. 160342, petitioner Atty. Fernando P. R. Perito, as a citizen and a member of the
Philippine Bar Association and of the Integrated Bar of the Philippines, and petitioner Engr.
Maximo N. Menez, Jr., as a taxpayer, pray in their petition for the issuance of a Temporary
Restraining Order and Permanent Injunction to enjoin the House of Representatives from
proceeding with the second impeachment complaint.

In G.R. No. 160343, petitioner Integrated Bar of the Philippines, alleging that it is mandated by
the Code of Professional Responsibility to uphold the Constitution, prays in its petition for
Certiorari and Prohibition that Sections 16 and 17 of Rule V and Sections 5, 6, 7, 8, 9 of Rule III
of the House Impeachment Rules be declared unconstitutional and that the House of
Representatives be permanently enjoined from proceeding with the second impeachment
complaint.

In G.R. No. 160360, petitioner-taxpayer Atty. Claro Flores prays in his petition for Certiorari
and Prohibition that the House Impeachment Rules be declared unconstitutional.

In G.R. No. 160365, petitioners U.P. Law Alumni Cebu Foundation Inc., et. al., in their petition
for Prohibition and Injunction which they claim is a class suit filed in behalf of all citizens, citing
Oposa v. Factoran17 which was filed in behalf of succeeding generations of Filipinos, pray for
the issuance of a writ prohibiting respondents House of Representatives and the Senate from
conducting further proceedings on the second impeachment complaint and that this Court declare
as unconstitutional the second impeachment complaint and the acts of respondent House of
Representatives in interfering with the fiscal matters of the Judiciary.

In G.R. No. 160370, petitioner-taxpayer Father Ranhilio Callangan Aquino, alleging that the
issues in his petition for Prohibition are of national and transcendental significance and that as an
official of the Philippine Judicial Academy, he has a direct and substantial interest in the
unhampered operation of the Supreme Court and its officials in discharging their duties in
accordance with the Constitution, prays for the issuance of a writ prohibiting the House of
Representatives from transmitting the Articles of Impeachment to the Senate and the Senate from
receiving the same or giving the impeachment complaint due course.

In G.R. No. 160376, petitioner Nilo A. Malanyaon, as a taxpayer, alleges in his petition for
Prohibition that respondents Fuentebella and Teodoro at the time they filed the second
impeachment complaint, were "absolutely without any legal power to do so, as they acted
without jurisdiction as far as the Articles of Impeachment assail the alleged abuse of powers of
the Chief Justice to disburse the (JDF)."

In G.R. No. 160392, petitioners Attorneys Venicio S. Flores and Hector L. Hofileña, alleging
that as professors of law they have an abiding interest in the subject matter of their petition for
Certiorari and Prohibition as it pertains to a constitutional issue "which they are trying to
inculcate in the minds of their students," pray that the House of Representatives be enjoined from
endorsing and the Senate from trying the Articles of Impeachment and that the second
impeachment complaint be declared null and void.

In G.R. No. 160397, petitioner Atty. Dioscoro Vallejos, Jr., without alleging his locus standi, but
alleging that the second impeachment complaint is founded on the issue of whether or not the
Judicial Development Fund (JDF) was spent in accordance with law and that the House of
Representatives does not have exclusive jurisdiction in the examination and audit thereof, prays
in his petition "To Declare Complaint Null and Void for Lack of Cause of Action and
Jurisdiction" that the second impeachment complaint be declared null and void.

In G.R. No. 160403, petitioner Philippine Bar Association, alleging that the issues raised in the
filing of the second impeachment complaint involve matters of transcendental importance, prays
in its petition for Certiorari/Prohibition that (1) the second impeachment complaint and all
proceedings arising therefrom be declared null and void; (2) respondent House of
Representatives be prohibited from transmitting the Articles of Impeachment to the Senate; and
(3) respondent Senate be prohibited from accepting the Articles of Impeachment and from
conducting any proceedings thereon.

In G.R. No. 160405, petitioners Democrit C. Barcenas et. al., as citizens and taxpayers, pray in
their petition for Certiorari/Prohibition that (1) the second impeachment complaint as well as the
resolution of endorsement and impeachment by the respondent House of Representatives be
declared null and void and (2) respondents Senate and Senate President Franklin Drilon be
prohibited from accepting any Articles of Impeachment against the Chief Justice or, in the event
that they have accepted the same, that they be prohibited from proceeding with the impeachment
trial.

Petitions bearing docket numbers G.R. Nos. 160261, 160262 and 160263, the first three of the
eighteen which were filed before this Court,18 prayed for the issuance of a Temporary
Restraining Order and/or preliminary injunction to prevent the House of Representatives from
transmitting the Articles of Impeachment arising from the second impeachment complaint to the
Senate. Petition bearing docket number G.R. No. 160261 likewise prayed for the declaration of
the November 28, 2001 House Impeachment Rules as null and void for being unconstitutional.

Petitions bearing docket numbers G.R. Nos. 160277, 160292 and 160295, which were filed on
October 28, 2003, sought similar relief. In addition, petition bearing docket number G.R. No.
160292 alleged that House Resolution No. 260 (calling for a legislative inquiry into the
administration by the Chief Justice of the JDF) infringes on the constitutional doctrine of
separation of powers and is a direct violation of the constitutional principle of fiscal autonomy of
the judiciary.

On October 28, 2003, during the plenary session of the House of Representatives, a motion was
put forth that the second impeachment complaint be formally transmitted to the Senate, but it
was not carried because the House of Representatives adjourned for lack of quorum,19 and as
reflected above, to date, the Articles of Impeachment have yet to be forwarded to the Senate.

Before acting on the petitions with prayers for temporary restraining order and/or writ of
preliminary injunction which were filed on or before October 28, 2003, Justices Puno and Vitug
offered to recuse themselves, but the Court rejected their offer. Justice Panganiban inhibited
himself, but the Court directed him to participate.

Without necessarily giving the petitions due course, this Court in its Resolution of October 28,
2003, resolved to (a) consolidate the petitions; (b) require respondent House of Representatives
and the Senate, as well as the Solicitor General, to comment on the petitions not later than 4:30
p.m. of November 3, 2003; (c) set the petitions for oral arguments on November 5, 2003, at
10:00 a.m.; and (d) appointed distinguished legal experts as amici curiae.20 In addition, this
Court called on petitioners and respondents to maintain the status quo, enjoining all the parties
and others acting for and in their behalf to refrain from committing acts that would render the
petitions moot.

Also on October 28, 2003, when respondent House of Representatives through Speaker Jose C.
De Venecia, Jr. and/or its co-respondents, by way of special appearance, submitted a
Manifestation asserting that this Court has no jurisdiction to hear, much less prohibit or enjoin
the House of Representatives, which is an independent and co-equal branch of government under
the Constitution, from the performance of its constitutionally mandated duty to initiate
impeachment cases. On even date, Senator Aquilino Q. Pimentel, Jr., in his own behalf, filed a
Motion to Intervene (Ex Abudante Cautela)21 and Comment, praying that "the consolidated
petitions be dismissed for lack of jurisdiction of the Court over the issues affecting the
impeachment proceedings and that the sole power, authority and jurisdiction of the Senate as the
impeachment court to try and decide impeachment cases, including the one where the Chief
Justice is the respondent, be recognized and upheld pursuant to the provisions of Article XI of
the Constitution."22

Acting on the other petitions which were subsequently filed, this Court resolved to (a)
consolidate them with the earlier consolidated petitions; (b) require respondents to file their
comment not later than 4:30 p.m. of November 3, 2003; and (c) include them for oral arguments
on November 5, 2003.

On October 29, 2003, the Senate of the Philippines, through Senate President Franklin M.
Drilon, filed a Manifestation stating that insofar as it is concerned, the petitions are plainly
premature and have no basis in law or in fact, adding that as of the time of the filing of the
petitions, no justiciable issue was presented before it since (1) its constitutional duty to constitute
itself as an impeachment court commences only upon its receipt of the Articles of Impeachment,
which it had not, and (2) the principal issues raised by the petitions pertain exclusively to the
proceedings in the House of Representatives.

On October 30, 2003, Atty. Jaime Soriano filed a "Petition for Leave to Intervene" in G.R. Nos.
160261, 160262, 160263, 160277, 160292, and 160295, questioning the status quo Resolution
issued by this Court on October 28, 2003 on the ground that it would unnecessarily put Congress
and this Court in a "constitutional deadlock" and praying for the dismissal of all the petitions as
the matter in question is not yet ripe for judicial determination.

On November 3, 2003, Attorneys Romulo B. Macalintal and Pete Quirino Quadra filed in G.R.
No. 160262 a "Motion for Leave of Court to Intervene and to Admit the Herein Incorporated
Petition in Intervention."

On November 4, 2003, Nagmamalasakit na mga Manananggol ng mga Manggagawang Pilipino,

Inc. filed a Motion for Intervention in G.R. No. 160261. On November 5, 2003, World War II
Veterans Legionnaires of the Philippines, Inc. also filed a "Petition-in-Intervention with Leave to
Intervene" in G.R. Nos. 160261, 160262, 160263, 160277, 160292, 160295, and 160310.

The motions for intervention were granted and both Senator Pimentel's Comment and Attorneys
Macalintal and Quadra's Petition in Intervention were admitted.

On November 5-6, 2003, this Court heard the views of the amici curiae and the arguments of
petitioners, intervenors Senator Pimentel and Attorney Makalintal, and Solicitor General Alfredo
Benipayo on the principal issues outlined in an Advisory issued by this Court on November 3,
2003, to wit:

Whether the certiorari jurisdiction of the Supreme Court may be invoked; who can
invoke it; on what issues and at what time; and whether it should be exercised by this
Court at this time.

In discussing these issues, the following may be taken up:

a) locus standi of petitioners;

b) ripeness(prematurity; mootness);

c) political question/justiciability;

d) House's "exclusive" power to initiate all cases of impeachment;

e) Senate's "sole" power to try and decide all cases of impeachment;

f) constitutionality of the House Rules on Impeachment vis-a-vis Section 3(5) of

Article XI of the Constitution; and

g) judicial restraint (Italics in the original)

In resolving the intricate conflux of preliminary and substantive issues arising from the instant
petitions as well as the myriad arguments and opinions presented for and against the grant of the
reliefs prayed for, this Court has sifted and determined them to be as follows: (1) the threshold
and novel issue of whether or not the power of judicial review extends to those arising from
impeachment proceedings; (2) whether or not the essential pre-requisites for the exercise of the
power of judicial review have been fulfilled; and (3) the substantive issues yet remaining. These
matters shall now be discussed in seriatim.

Judicial Review

As reflected above, petitioners plead for this Court to exercise the power of judicial review to
determine the validity of the second impeachment complaint.

This Court's power of judicial review is conferred on the judicial branch of the government in
Section 1, Article VIII of our present 1987 Constitution:

SECTION 1. The judicial power shall be vested in one Supreme Court and in such lower
courts as may be established by law.

Judicial power includes the duty of the courts of justice to settle actual controversies
involving rights which are legally demandable and enforceable, and to determine
whether or not there has been a grave abuse of discretion amounting to lack or
excess of jurisdiction on the part of any branch or instrumentality of the
government. (Emphasis supplied)
Such power of judicial review was early on exhaustively expounded upon by Justice Jose P.
Laurel in the definitive 1936 case of Angara v. Electoral Commission23 after the effectivity of the
1935 Constitution whose provisions, unlike the present Constitution, did not contain the present
provision in Article VIII, Section 1, par. 2 on what judicial power includes. Thus, Justice Laurel
discoursed:

x x x In times of social disquietude or political excitement, the great landmarks of the

Constitution are apt to be forgotten or marred, if not entirely obliterated. In cases of
conflict, the judicial department is the only constitutional organ which can be called
upon to determine the proper allocation of powers between the several departments
and among the integral or constituent units thereof.

As any human production, our Constitution is of course lacking perfection and

perfectibility, but as much as it was within the power of our people, acting through their
delegates to so provide, that instrument which is the expression of their sovereignty
however limited, has established a republican government intended to operate and
function as a harmonious whole, under a system of checks and balances, and subject to
specific limitations and restrictions provided in the said instrument. The Constitution
sets forth in no uncertain language the restrictions and limitations upon
governmental powers and agencies. If these restrictions and limitations are
transcended it would be inconceivable if the Constitution had not provided for a
mechanism by which to direct the course of government along constitutional
channels, for then the distribution of powers would be mere verbiage, the bill of rights
mere expressions of sentiment, and the principles of good government mere political
apothegms. Certainly, the limitations and restrictions embodied in our Constitution are
real as they should be in any living constitution. In the United States where no express
constitutional grant is found in their constitution, the possession of this moderating
power of the courts, not to speak of its historical origin and development there, has been
set at rest by popular acquiescence for a period of more than one and a half centuries. In
our case, this moderating power is granted, if not expressly, by clear implication from
section 2 of article VIII of our Constitution.

The Constitution is a definition of the powers of government. Who is to determine the

nature, scope and extent of such powers? The Constitution itself has provided for
the instrumentality of the judiciary as the rational way. And when the judiciary
mediates to allocate constitutional boundaries, it does not assert any superiority over
the other departments; it does not in reality nullify or invalidate an act of the legislature,
but only asserts the solemn and sacred obligation assigned to it by the Constitution
to determine conflicting claims of authority under the Constitution and to establish
for the parties in an actual controversy the rights which that instrument secures and
guarantees to them. This is in truth all that is involved in what is termed "judicial
supremacy" which properly is the power of judicial review under the Constitution.
Even then, this power of judicial review is limited to actual cases and controversies to be
exercised after full opportunity of argument by the parties, and limited further to the
constitutional question raised or the very lis mota presented. Any attempt at abstraction
could only lead to dialectics and barren legal questions and to sterile conclusions
unrelated to actualities. Narrowed as its function is in this manner, the judiciary does not
pass upon questions of wisdom, justice or expediency of legislation. More than that,
courts accord the presumption of constitutionality to legislative enactments, not only
because the legislature is presumed to abide by the Constitution but also because the
 judiciary in the determination of actual cases and controversies must reflect the wisdom
and justice of the people as expressed through their representatives in the executive and
legislative departments of the government.24 (Italics in the original; emphasis and
underscoring supplied)

As pointed out by Justice Laurel, this "moderating power" to "determine the proper allocation of
powers" of the different branches of government and "to direct the course of government along
constitutional channels" is inherent in all courts25 as a necessary consequence of the judicial
power itself, which is "the power of the court to settle actual controversies involving rights
which are legally demandable and enforceable."26

Thus, even in the United States where the power of judicial review is not explicitly conferred
upon the courts by its Constitution, such power has "been set at rest by popular acquiescence for
a period of more than one and a half centuries." To be sure, it was in the 1803 leading case of
Marbury v. Madison27 that the power of judicial review was first articulated by Chief Justice
Marshall, to wit:

It is also not entirely unworthy of observation, that in declaring what shall be the supreme
law of the land, the constitution itself is first mentioned; and not the laws of the United
States generally, but those only which shall be made in pursuance of the constitution,
have that rank.

Thus, the particular phraseology of the constitution of the United States confirms and
strengthens the principle, supposed to be essential to all written constitutions, that a
law repugnant to the constitution is void; and that courts, as well as other
departments, are bound by that instrument.28 (Italics in the original; emphasis
supplied)

In our own jurisdiction, as early as 1902, decades before its express grant in the 1935
Constitution, the power of judicial review was exercised by our courts to invalidate
constitutionally infirm acts.29 And as pointed out by noted political law professor and former
Supreme Court Justice Vicente V. Mendoza,30 the executive and legislative branches of our
government in fact effectively acknowledged this power of judicial review in Article 7 of the
Civil Code, to wit:

Article 7. Laws are repealed only by subsequent ones, and their violation or non-
observance shall not be excused by disuse, or custom or practice to the contrary.

When the courts declare a law to be inconsistent with the Constitution, the former
shall be void and the latter shall govern.

Administrative or executive acts, orders and regulations shall be valid only when
they are not contrary to the laws or the Constitution. (Emphasis supplied)

As indicated in Angara v. Electoral Commission,31 judicial review is indeed an integral

component of the delicate system of checks and balances which, together with the corollary
principle of separation of powers, forms the bedrock of our republican form of government and
insures that its vast powers are utilized only for the benefit of the people for which it serves.
 The separation of powers is a fundamental principle in our system of government. It
obtains not through express provision but by actual division in our Constitution. Each
department of the government has exclusive cognizance of matters within its jurisdiction,
and is supreme within its own sphere. But it does not follow from the fact that the three
powers are to be kept separate and distinct that the Constitution intended them to be
absolutely unrestrained and independent of each other. The Constitution has provided
for an elaborate system of checks and balances to secure coordination in the
workings of the various departments of the government. x x x And the judiciary in
turn, with the Supreme Court as the final arbiter, effectively checks the other
departments in the exercise of its power to determine the law, and hence to declare
executive and legislative acts void if violative of the Constitution.32 (Emphasis and
underscoring supplied)

In the scholarly estimation of former Supreme Court Justice Florentino Feliciano, "x x x judicial
review is essential for the maintenance and enforcement of the separation of powers and the
balancing of powers among the three great departments of government through the definition and
maintenance of the boundaries of authority and control between them."33 To him, "[j]udicial
review is the chief, indeed the only, medium of participation – or instrument of intervention – of
the judiciary in that balancing operation."34

To ensure the potency of the power of judicial review to curb grave abuse of discretion by "any
branch or instrumentalities of government," the afore-quoted Section 1, Article VIII of the
Constitution engraves, for the first time into its history, into block letter law the so-called
"expanded certiorari jurisdiction" of this Court, the nature of and rationale for which are
mirrored in the following excerpt from the sponsorship speech of its proponent, former Chief
Justice Constitutional Commissioner Roberto Concepcion:

xxx

The first section starts with a sentence copied from former Constitutions. It says:

The judicial power shall be vested in one Supreme Court and in such lower courts as may
be established by law.

I suppose nobody can question it.

The next provision is new in our constitutional law. I will read it first and explain.

Judicial power includes the duty of courts of justice to settle actual controversies
involving rights which are legally demandable and enforceable and to determine whether
or not there has been a grave abuse of discretion amounting to lack or excess of
jurisdiction on the part or instrumentality of the government.

Fellow Members of this Commission, this is actually a product of our experience

during martial law. As a matter of fact, it has some antecedents in the past, but the role
of the judiciary during the deposed regime was marred considerably by the
circumstance that in a number of cases against the government, which then had no
legal defense at all, the solicitor general set up the defense of political questions and
got away with it. As a consequence, certain principles concerning particularly the writ of
habeas corpus, that is, the authority of courts to order the release of political detainees,
 and other matters related to the operation and effect of martial law failed because the
government set up the defense of political question. And the Supreme Court said: "Well,
since it is political, we have no authority to pass upon it." The Committee on the
Judiciary feels that this was not a proper solution of the questions involved. It did
not merely request an encroachment upon the rights of the people, but it, in effect,
encouraged further violations thereof during the martial law regime. x x x

xxx

Briefly stated, courts of justice determine the limits of power of the agencies and
offices of the government as well as those of its officers. In other words, the
judiciary is the final arbiter on the question whether or not a branch of government
or any of its officials has acted without jurisdiction or in excess of jurisdiction, or so
capriciously as to constitute an abuse of discretion amounting to excess of
jurisdiction or lack of jurisdiction. This is not only a judicial power but a duty to
pass judgment on matters of this nature.

This is the background of paragraph 2 of Section 1, which means that the courts cannot
hereafter evade the duty to settle matters of this nature, by claiming that such
matters constitute a political question.35 (Italics in the original; emphasis and
underscoring supplied)

To determine the merits of the issues raised in the instant petitions, this Court must necessarily
turn to the Constitution itself which employs the well-settled principles of constitutional
construction.

First, verba legis, that is, wherever possible, the words used in the Constitution must be given
their ordinary meaning except where technical terms are employed. Thus, in J.M. Tuason & Co.,
Inc. v. Land Tenure Administration,36 this Court, speaking through Chief Justice Enrique
Fernando, declared:

We look to the language of the document itself in our search for its meaning. We do
not of course stop there, but that is where we begin. It is to be assumed that the
words in which constitutional provisions are couched express the objective sought to
be attained. They are to be given their ordinary meaning except where technical
terms are employed in which case the significance thus attached to them prevails. As
the Constitution is not primarily a lawyer's document, it being essential for the rule of law
to obtain that it should ever be present in the people's consciousness, its language as
much as possible should be understood in the sense they have in common use. What it
says according to the text of the provision to be construed compels acceptance and
negates the power of the courts to alter it, based on the postulate that the framers and the
people mean what they say. Thus these are the cases where the need for construction is
reduced to a minimum.37 (Emphasis and underscoring supplied)

Second, where there is ambiguity, ratio legis est anima. The words of the Constitution should be
interpreted in accordance with the intent of its framers. And so did this Court apply this principle
in Civil Liberties Union v. Executive Secretary38 in this wise:

A foolproof yardstick in constitutional construction is the intention underlying the

provision under consideration. Thus, it has been held that the Court in construing a
 Constitution should bear in mind the object sought to be accomplished by its adoption,
and the evils, if any, sought to be prevented or remedied. A doubtful provision will be
examined in the light of the history of the times, and the condition and circumstances
under which the Constitution was framed. The object is to ascertain the reason which
induced the framers of the Constitution to enact the particular provision and the
purpose sought to be accomplished thereby, in order to construe the whole as to
make the words consonant to that reason and calculated to effect that purpose.39
(Emphasis and underscoring supplied)

As it did in Nitafan v. Commissioner on Internal Revenue40 where, speaking through Madame

Justice Amuerfina A. Melencio-Herrera, it declared:

x x x The ascertainment of that 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.41 (Emphasis and underscoring supplied)

Finally, ut magis valeat quam pereat. The Constitution is to be interpreted as a whole. Thus, in
Chiongbian v. De Leon,42 this Court, through Chief Justice Manuel Moran declared:

x x x [T]he members of the Constitutional Convention could not have dedicated a

provision of our Constitution merely for the benefit of one person without
considering that it could also affect others. When they adopted subsection 2, they
permitted, if not willed, that said provision should function to the full extent of its
substance and its terms, not by itself alone, but in conjunction with all other
provisions of that great document.43 (Emphasis and underscoring supplied)

Likewise, still in Civil Liberties Union v. Executive Secretary,44 this Court affirmed that:

It is a well-established rule in constitutional construction that no one provision of

the Constitution is to be separated from all the others, to be considered alone, but
that all the provisions bearing upon a particular subject are to be brought into view
and to be so interpreted as to effectuate the great purposes of the instrument.
Sections bearing on a particular subject should be considered and interpreted
together as to effectuate the whole purpose of the Constitution and one section is not
to be allowed to defeat another, if by any reasonable construction, the two can be
made to stand together.

In other words, the court must harmonize them, if practicable, and must lean in favor of a
construction which will render every word operative, rather than one which may make
the words idle and nugatory.45 (Emphasis supplied)

If, however, the plain meaning of the word is not found to be clear, resort to other aids is
available. In still the same case of Civil Liberties Union v. Executive Secretary, this Court
expounded:
 While it is permissible in this jurisdiction to consult the debates and proceedings of the
constitutional convention in order to arrive at the reason and purpose of the resulting
Constitution, resort thereto may be had only when other guides fail as said
proceedings are powerless to vary the terms of the Constitution when the meaning is
clear. Debates in the constitutional convention "are of value as showing the views of the
individual members, and as indicating the reasons for their votes, but they give us no
light as to the views of the large majority who did not talk, much less of the mass of our
fellow citizens whose votes at the polls gave that instrument the force of fundamental
law. We think it safer to construe the constitution from what appears upon its face."
The proper interpretation therefore depends more on how it was understood by the
people adopting it than in the framers's understanding thereof.46 (Emphasis and
underscoring supplied)

It is in the context of the foregoing backdrop of constitutional refinement and jurisprudential

application of the power of judicial review that respondents Speaker De Venecia, et. al. and
intervenor Senator Pimentel raise the novel argument that the Constitution has excluded
impeachment proceedings from the coverage of judicial review.

Briefly stated, it is the position of respondents Speaker De Venecia et. al. that impeachment is a
political action which cannot assume a judicial character. Hence, any question, issue or incident
arising at any stage of the impeachment proceeding is beyond the reach of judicial review.47

For his part, intervenor Senator Pimentel contends that the Senate's "sole power to try"
impeachment cases48 (1) entirely excludes the application of judicial review over it; and (2)
necessarily includes the Senate's power to determine constitutional questions relative to
impeachment proceedings.49

In furthering their arguments on the proposition that impeachment proceedings are outside the
scope of judicial review, respondents Speaker De Venecia, et. al. and intervenor Senator
Pimentel rely heavily on American authorities, principally the majority opinion in the case of
Nixon v. United States.50 Thus, they contend that the exercise of judicial review over
impeachment proceedings is inappropriate since it runs counter to the framers' decision to
allocate to different fora the powers to try impeachments and to try crimes; it disturbs the system
of checks and balances, under which impeachment is the only legislative check on the judiciary;
and it would create a lack of finality and difficulty in fashioning relief.51 Respondents likewise
point to deliberations on the US Constitution to show the intent to isolate judicial power of
review in cases of impeachment.

Respondents' and intervenors' reliance upon American jurisprudence, the American Constitution
and American authorities cannot be credited to support the proposition that the Senate's "sole
power to try and decide impeachment cases," as provided for under Art. XI, Sec. 3(6) of the
Constitution, is a textually demonstrable constitutional commitment of all issues pertaining to
impeachment to the legislature, to the total exclusion of the power of judicial review to check
and restrain any grave abuse of the impeachment process. Nor can it reasonably support the
interpretation that it necessarily confers upon the Senate the inherently judicial power to
determine constitutional questions incident to impeachment proceedings.

Said American jurisprudence and authorities, much less the American Constitution, are of
dubious application for these are no longer controlling within our jurisdiction and have only
limited persuasive merit insofar as Philippine constitutional law is concerned. As held in the case
of Garcia vs. COMELEC,52 "[i]n resolving constitutional disputes, [this Court] should not be
beguiled by foreign jurisprudence some of which are hardly applicable because they have been
dictated by different constitutional settings and needs."53 Indeed, although the Philippine
Constitution can trace its origins to that of the United States, their paths of development have
long since diverged. In the colorful words of Father Bernas, "[w]e have cut the umbilical cord."

The major difference between the judicial power of the Philippine Supreme Court and that of the
U.S. Supreme Court is that while the power of judicial review is only impliedly granted to the
U.S. Supreme Court and is discretionary in nature, that granted to the Philippine Supreme Court
and lower courts, as expressly provided for in the Constitution, is not just a power but also a
duty, and it was given an expanded definition to include the power to correct any grave abuse
of discretion on the part of any government branch or instrumentality.

There are also glaring distinctions between the U.S. Constitution and the Philippine Constitution
with respect to the power of the House of Representatives over impeachment proceedings. While
the U.S. Constitution bestows sole power of impeachment to the House of Representatives
without limitation,54 our Constitution, though vesting in the House of Representatives the
exclusive power to initiate impeachment cases,55 provides for several limitations to the exercise
of such power as embodied in Section 3(2), (3), (4) and (5), Article XI thereof. These limitations
include the manner of filing, required vote to impeach, and the one year bar on the impeachment
of one and the same official.

Respondents are also of the view that judicial review of impeachments undermines their finality
and may also lead to conflicts between Congress and the judiciary. Thus, they call upon this
Court to exercise judicial statesmanship on the principle that "whenever possible, the Court
should defer to the judgment of the people expressed legislatively, recognizing full well the
perils of judicial willfulness and pride."56

But did not the people also express their will when they instituted the above-mentioned
safeguards in the Constitution? This shows that the Constitution did not intend to leave the
matter of impeachment to the sole discretion of Congress. Instead, it provided for certain well-
defined limits, or in the language of Baker v. Carr,57 "judicially discoverable standards" for
determining the validity of the exercise of such discretion, through the power of judicial review.

The cases of Romulo v. Yniguez58 and Alejandrino v. Quezon,59 cited by respondents in support
of the argument that the impeachment power is beyond the scope of judicial review, are not in
point. These cases concern the denial of petitions for writs of mandamus to compel the
legislature to perform non-ministerial acts, and do not concern the exercise of the power of
judicial review.

There is indeed a plethora of cases in which this Court exercised the power of judicial review
over congressional action. Thus, in Santiago v. Guingona, Jr.,60 this Court ruled that it is well
within the power and jurisdiction of the Court to inquire whether the Senate or its officials
committed a violation of the Constitution or grave abuse of discretion in the exercise of their
functions and prerogatives. In Tanada v. Angara,61 in seeking to nullify an act of the Philippine
Senate on the ground that it contravened the Constitution, it held that the petition raises a
justiciable controversy and that when an action of the legislative branch is seriously alleged to
have infringed the Constitution, it becomes not only the right but in fact the duty of the judiciary
to settle the dispute. In Bondoc v. Pineda,62 this Court declared null and void a resolution of the
House of Representatives withdrawing the nomination, and rescinding the election, of a
congressman as a member of the House Electoral Tribunal for being violative of Section 17,
Article VI of the Constitution. In Coseteng v. Mitra,63 it held that the resolution of whether the
House representation in the Commission on Appointments was based on proportional
representation of the political parties as provided in Section 18, Article VI of the Constitution is
subject to judicial review. In Daza v. Singson,64 it held that the act of the House of
Representatives in removing the petitioner from the Commission on Appointments is subject to
judicial review. In Tanada v. Cuenco,65 it held that although under the Constitution, the
legislative power is vested exclusively in Congress, this does not detract from the power of the
courts to pass upon the constitutionality of acts of Congress. In Angara v. Electoral
Commission,66 it ruled that confirmation by the National Assembly of the election of any
member, irrespective of whether his election is contested, is not essential before such member-
elect may discharge the duties and enjoy the privileges of a member of the National Assembly.

Finally, there exists no constitutional basis for the contention that the exercise of judicial review
over impeachment proceedings would upset the system of checks and balances. Verily, the
Constitution is to be interpreted as a whole and "one section is not to be allowed to defeat
another."67 Both are integral components of the calibrated system of independence and
interdependence that insures that no branch of government act beyond the powers assigned to it
by the Constitution.

Essential Requisites for Judicial Review

As clearly stated in Angara v. Electoral Commission, the courts' power of judicial review, like
almost all powers conferred by the Constitution, is subject to several limitations, namely: (1) an
actual case or controversy calling for the exercise of judicial power; (2) the person challenging
the act must have "standing" to challenge; he must have a personal and substantial interest in the
case such that he has sustained, or will sustain, direct injury as a result of its enforcement; (3) the
question of constitutionality must be raised at the earliest possible opportunity; and (4) the issue
of constitutionality must be the very lis mota of the case.

x x x Even then, this power of judicial review is limited to actual cases and controversies
to be exercised after full opportunity of argument by the parties, and limited further to the
constitutional question raised or the very lis mota presented. Any attempt at abstraction
could only lead to dialectics and barren legal questions and to sterile conclusions
unrelated to actualities. Narrowed as its function is in this manner, the judiciary does not
pass upon questions of wisdom, justice or expediency of legislation. More than that,
courts accord the presumption of constitutionality to legislative enactments, not only
because the legislature is presumed to abide by the Constitution but also because the
judiciary in the determination of actual cases and controversies must reflect the wisdom
and justice of the people as expressed through their representatives in the executive and
legislative departments of the government.68 (Italics in the original)

Standing

Locus standi or legal standing or has been defined as a personal and substantial interest in the
case such that the party has sustained or will sustain direct injury as a result of the governmental
act that is being challenged. The gist of the question of standing is whether a party alleges such
personal stake in the outcome of the controversy as to assure that concrete adverseness which
sharpens the presentation of issues upon which the court depends for illumination of difficult
constitutional questions.69
Intervenor Soriano, in praying for the dismissal of the petitions, contends that petitioners do not
have standing since only the Chief Justice has sustained and will sustain direct personal injury.
Amicus curiae former Justice Minister and Solicitor General Estelito Mendoza similarly
contends.

Upon the other hand, the Solicitor General asserts that petitioners have standing since this Court
had, in the past, accorded standing to taxpayers, voters, concerned citizens, legislators in cases
involving paramount public interest70 and transcendental importance,71 and that procedural
matters are subordinate to the need to determine whether or not the other branches of the
government have kept themselves within the limits of the Constitution and the laws and that they
have not abused the discretion given to them.72 Amicus curiae Dean Raul Pangalangan of the
U.P. College of Law is of the same opinion, citing transcendental importance and the well-
entrenched rule exception that, when the real party in interest is unable to vindicate his rights by
seeking the same remedies, as in the case of the Chief Justice who, for ethical reasons, cannot
himself invoke the jurisdiction of this Court, the courts will grant petitioners standing.

There is, however, a difference between the rule on real-party-in-interest and the rule on
standing, for the former is a concept of civil procedure73 while the latter has constitutional
underpinnings.74 In view of the arguments set forth regarding standing, it behooves the Court to
reiterate the ruling in Kilosbayan, Inc. v. Morato75 to clarify what is meant by locus standi and to
distinguish it from real party-in-interest.

The difference between the rule on standing and real party in interest has been noted by
authorities thus: "It is important to note . . . that standing because of its constitutional and
public policy underpinnings, is very different from questions relating to whether a
particular plaintiff is the real party in interest or has capacity to sue. Although all three
requirements are directed towards ensuring that only certain parties can maintain an
action, standing restrictions require a partial consideration of the merits, as well as
broader policy concerns relating to the proper role of the judiciary in certain areas.

Standing is a special concern in constitutional law because in some cases suits are
brought not by parties who have been personally injured by the operation of a law or by
official action taken, but by concerned citizens, taxpayers or voters who actually sue in
the public interest. Hence the question in standing is whether such parties have "alleged
such a personal stake in the outcome of the controversy as to assure that concrete
adverseness which sharpens the presentation of issues upon which the court so largely
depends for illumination of difficult constitutional questions."

xxx

On the other hand, the question as to "real party in interest" is whether he is "the party
who would be benefited or injured by the judgment, or the 'party entitled to the avails of
the suit.'"76 (Citations omitted)

While rights personal to the Chief Justice may have been injured by the alleged unconstitutional
acts of the House of Representatives, none of the petitioners before us asserts a violation of the
personal rights of the Chief Justice. On the contrary, they invariably invoke the vindication of
their own rights – as taxpayers; members of Congress; citizens, individually or in a class suit;
and members of the bar and of the legal profession – which were supposedly violated by the
alleged unconstitutional acts of the House of Representatives.
In a long line of cases, however, concerned citizens, taxpayers and legislators when specific
requirements have been met have been given standing by this Court.

When suing as a citizen, the interest of the petitioner assailing the constitutionality of a statute
must be direct and personal. He must be able to show, not only that the law or any government
act is invalid, but also that he sustained or is in imminent danger of sustaining some direct injury
as a result of its enforcement, and not merely that he suffers thereby in some indefinite way. It
must appear that the person complaining has been or is about to be denied some right or privilege
to which he is lawfully entitled or that he is about to be subjected to some burdens or penalties
by reason of the statute or act complained of.77 In fine, when the proceeding involves the
assertion of a public right,78 the mere fact that he is a citizen satisfies the requirement of personal
interest.

In the case of a taxpayer, he is allowed to sue where there is a claim that public funds are
illegally disbursed, or that public money is being deflected to any improper purpose, or that there
is a wastage of public funds through the enforcement of an invalid or unconstitutional law.79
Before he can invoke the power of judicial review, however, he must specifically prove that he
has sufficient interest in preventing the illegal expenditure of money raised by taxation and that
he would sustain a direct injury as a result of the enforcement of the questioned statute or
contract. It is not sufficient that he has merely a general interest common to all members of the
public.80

At all events, courts are vested with discretion as to whether or not a taxpayer's suit should be
entertained.81 This Court opts to grant standing to most of the petitioners, given their allegation
that any impending transmittal to the Senate of the Articles of Impeachment and the ensuing trial
of the Chief Justice will necessarily involve the expenditure of public funds.

As for a legislator, he is allowed to sue to question the validity of any official action which he
claims infringes his prerogatives as a legislator.82 Indeed, a member of the House of
Representatives has standing to maintain inviolate the prerogatives, powers and privileges vested
by the Constitution in his office.83

While an association has legal personality to represent its members,84 especially when it is
composed of substantial taxpayers and the outcome will affect their vital interests,85 the mere
invocation by the Integrated Bar of the Philippines or any member of the legal profession of the
duty to preserve the rule of law and nothing more, although undoubtedly true, does not suffice to
clothe it with standing. Its interest is too general. It is shared by other groups and the whole
citizenry. However, a reading of the petitions shows that it has advanced constitutional issues
which deserve the attention of this Court in view of their seriousness, novelty and weight as
precedents.86 It, therefore, behooves this Court to relax the rules on standing and to resolve the
issues presented by it.

In the same vein, when dealing with class suits filed in behalf of all citizens, persons intervening
must be sufficiently numerous to fully protect the interests of all concerned87 to enable the court
to deal properly with all interests involved in the suit,88 for a judgment in a class suit, whether
favorable or unfavorable to the class, is, under the res judicata principle, binding on all members
of the class whether or not they were before the court.89 Where it clearly appears that not all
interests can be sufficiently represented as shown by the divergent issues raised in the numerous
petitions before this Court, G.R. No. 160365 as a class suit ought to fail. Since petitioners
additionally allege standing as citizens and taxpayers, however, their petition will stand.
The Philippine Bar Association, in G.R. No. 160403, invokes the sole ground of transcendental
importance, while Atty. Dioscoro U. Vallejos, in G.R. No. 160397, is mum on his standing.

There being no doctrinal definition of transcendental importance, the following instructive

determinants formulated by former Supreme Court Justice Florentino P. Feliciano are instructive:
(1) the character of the funds or other assets involved in the case; (2) the presence of a clear case
of disregard of a constitutional or statutory prohibition by the public respondent agency or
instrumentality of the government; and (3) the lack of any other party with a more direct and
specific interest in raising the questions being raised.90 Applying these determinants, this Court is
satisfied that the issues raised herein are indeed of transcendental importance.

In not a few cases, this Court has in fact adopted a liberal attitude on the locus standi of a
petitioner where the petitioner is able to craft an issue of transcendental significance to the
people, as when the issues raised are of paramount importance to the public.91 Such liberality
does not, however, mean that the requirement that a party should have an interest in the matter is
totally eliminated. A party must, at the very least, still plead the existence of such interest, it not
being one of which courts can take judicial notice. In petitioner Vallejos' case, he failed to allege
any interest in the case. He does not thus have standing.

With respect to the motions for intervention, Rule 19, Section 2 of the Rules of Court requires an
intervenor to possess a legal interest in the matter in litigation, or in the success of either of the
parties, or an interest against both, or is so situated as to be adversely affected by a distribution or
other disposition of property in the custody of the court or of an officer thereof. While
intervention is not a matter of right, it may be permitted by the courts when the applicant shows
facts which satisfy the requirements of the law authorizing intervention.92

In Intervenors Attorneys Romulo Macalintal and Pete Quirino Quadra's case, they seek to join
petitioners Candelaria, et. al. in G.R. No. 160262. Since, save for one additional issue, they raise
the same issues and the same standing, and no objection on the part of petitioners Candelaria, et.
al. has been interposed, this Court as earlier stated, granted the Motion for Leave of Court to
Intervene and Petition-in-Intervention.

Nagmamalasakit na mga Manananggol ng mga Manggagawang Pilipino, Inc., et. al. sought to
join petitioner Francisco in G.R. No. 160261. Invoking their right as citizens to intervene,
alleging that "they will suffer if this insidious scheme of the minority members of the House of
Representatives is successful," this Court found the requisites for intervention had been complied
with.

Alleging that the issues raised in the petitions in G.R. Nos. 160261, 160262, 160263, 160277,
160292, 160295, and 160310 were of transcendental importance, World War II Veterans
Legionnaires of the Philippines, Inc. filed a "Petition-in-Intervention with Leave to Intervene" to
raise the additional issue of whether or not the second impeachment complaint against the Chief
Justice is valid and based on any of the grounds prescribed by the Constitution.

Finding that Nagmamalasakit na mga Manananggol ng mga Manggagawang Pilipino, Inc., et al.
and World War II Veterans Legionnaires of the Philippines, Inc. possess a legal interest in the
matter in litigation the respective motions to intervene were hereby granted.

Senator Aquilino Pimentel, on the other hand, sought to intervene for the limited purpose of
making of record and arguing a point of view that differs with Senate President Drilon's. He
alleges that submitting to this Court's jurisdiction as the Senate President does will undermine
the independence of the Senate which will sit as an impeachment court once the Articles of
Impeachment are transmitted to it from the House of Representatives. Clearly, Senator Pimentel
possesses a legal interest in the matter in litigation, he being a member of Congress against
which the herein petitions are directed. For this reason, and to fully ventilate all substantial issues
relating to the matter at hand, his Motion to Intervene was granted and he was, as earlier stated,
allowed to argue.

Lastly, as to Jaime N. Soriano's motion to intervene, the same must be denied for, while he
asserts an interest as a taxpayer, he failed to meet the standing requirement for bringing
taxpayer's suits as set forth in Dumlao v. Comelec,93 to wit:

x x x While, concededly, the elections to be held involve the expenditure of public

moneys, nowhere in their Petition do said petitioners allege that their tax money is "being
extracted and spent in violation of specific constitutional protection against abuses of
legislative power," or that there is a misapplication of such funds by respondent
COMELEC, or that public money is being deflected to any improper purpose. Neither do
petitioners seek to restrain respondent from wasting public funds through the
enforcement of an invalid or unconstitutional law.94 (Citations omitted)

In praying for the dismissal of the petitions, Soriano failed even to allege that the act of
petitioners will result in illegal disbursement of public funds or in public money being deflected
to any improper purpose. Additionally, his mere interest as a member of the Bar does not suffice
to clothe him with standing.

Ripeness and Prematurity

In Tan v. Macapagal,95 this Court, through Chief Justice Fernando, held that for a case to be
considered ripe for adjudication, "it is a prerequisite that something had by then been
accomplished or performed by either branch before a court may come into the picture."96 Only
then may the courts pass on the validity of what was done, if and when the latter is challenged in
an appropriate legal proceeding.

The instant petitions raise in the main the issue of the validity of the filing of the second
impeachment complaint against the Chief Justice in accordance with the House Impeachment
Rules adopted by the 12th Congress, the constitutionality of which is questioned. The questioned
acts having been carried out, i.e., the second impeachment complaint had been filed with the
House of Representatives and the 2001 Rules have already been already promulgated and
enforced, the prerequisite that the alleged unconstitutional act should be accomplished and
performed before suit, as Tan v. Macapagal holds, has been complied with.

Related to the issue of ripeness is the question of whether the instant petitions are premature.
Amicus curiae former Senate President Jovito R. Salonga opines that there may be no urgent
need for this Court to render a decision at this time, it being the final arbiter on questions of
constitutionality anyway. He thus recommends that all remedies in the House and Senate should
first be exhausted.

Taking a similar stand is Dean Raul Pangalangan of the U.P. College of Law who suggests to
this Court to take judicial notice of on-going attempts to encourage signatories to the second
impeachment complaint to withdraw their signatures and opines that the House Impeachment
Rules provide for an opportunity for members to raise constitutional questions themselves when
the Articles of Impeachment are presented on a motion to transmit to the same to the Senate. The
dean maintains that even assuming that the Articles are transmitted to the Senate, the Chief
Justice can raise the issue of their constitutional infirmity by way of a motion to dismiss.

The dean's position does not persuade. First, the withdrawal by the Representatives of their
signatures would not, by itself, cure the House Impeachment Rules of their constitutional
infirmity. Neither would such a withdrawal, by itself, obliterate the questioned second
impeachment complaint since it would only place it under the ambit of Sections 3(2) and (3) of
Article XI of the Constitution97 and, therefore, petitioners would continue to suffer their injuries.

Second and most importantly, the futility of seeking remedies from either or both Houses of
Congress before coming to this Court is shown by the fact that, as previously discussed, neither
the House of Representatives nor the Senate is clothed with the power to rule with definitiveness
on the issue of constitutionality, whether concerning impeachment proceedings or otherwise, as
said power is exclusively vested in the judiciary by the earlier quoted Section I, Article VIII of
the Constitution. Remedy cannot be sought from a body which is bereft of power to grant it.

Justiciability

In the leading case of Tanada v. Cuenco,98 Chief Justice Roberto Concepcion defined the term
"political question," viz:

[T]he term "political question" connotes, in legal parlance, what it means in ordinary
parlance, namely, a question of policy. In other words, in the language of Corpus Juris
Secundum, it refers to "those questions which, under the Constitution, are to be decided
by the people in their sovereign capacity, or in regard to which full discretionary
authority has been delegated to the Legislature or executive branch of the Government."
It is concerned with issues dependent upon the wisdom, not legality, of a particular
measure.99 (Italics in the original)

Prior to the 1973 Constitution, without consistency and seemingly without any rhyme or reason,
this Court vacillated on its stance of taking cognizance of cases which involved political
questions. In some cases, this Court hid behind the cover of the political question doctrine and
refused to exercise its power of judicial review.100 In other cases, however, despite the seeming
political nature of the therein issues involved, this Court assumed jurisdiction whenever it found
constitutionally imposed limits on powers or functions conferred upon political bodies.101 Even
in the landmark 1988 case of Javellana v. Executive Secretary102 which raised the issue of
whether the 1973 Constitution was ratified, hence, in force, this Court shunted the political
question doctrine and took cognizance thereof. Ratification by the people of a Constitution is a
political question, it being a question decided by the people in their sovereign capacity.

The frequency with which this Court invoked the political question doctrine to refuse to take
jurisdiction over certain cases during the Marcos regime motivated Chief Justice Concepcion,
when he became a Constitutional Commissioner, to clarify this Court's power of judicial review
and its application on issues involving political questions, viz:

MR. CONCEPCION. Thank you, Mr. Presiding Officer.

I will speak on the judiciary. Practically, everybody has made, I suppose, the usual comment that
the judiciary is the weakest among the three major branches of the service. Since the legislature
holds the purse and the executive the sword, the judiciary has nothing with which to enforce its
decisions or commands except the power of reason and appeal to conscience which, after all,
reflects the will of God, and is the most powerful of all other powers without exception. x x x
And so, with the body's indulgence, I will proceed to read the provisions drafted by the
Committee on the Judiciary.

The first section starts with a sentence copied from former Constitutions. It says:

The judicial power shall be vested in one Supreme Court and in such lower courts as may
be established by law.

I suppose nobody can question it.

The next provision is new in our constitutional law. I will read it first and explain.

Judicial power includes the duty of courts of justice to settle actual controversies
involving rights which are legally demandable and enforceable and to determine whether
or not there has been a grave abuse of discretion amounting to lack or excess of
jurisdiction on the part or instrumentality of the government.

Fellow Members of this Commission, this is actually a product of our experience during
martial law. As a matter of fact, it has some antecedents in the past, but the role of the
judiciary during the deposed regime was marred considerably by the circumstance
that in a number of cases against the government, which then had no legal defense
at all, the solicitor general set up the defense of political questions and got away with
it. As a consequence, certain principles concerning particularly the writ of habeas
corpus, that is, the authority of courts to order the release of political detainees, and
other matters related to the operation and effect of martial law failed because the
government set up the defense of political question. And the Supreme Court said:
"Well, since it is political, we have no authority to pass upon it." The Committee on the
Judiciary feels that this was not a proper solution of the questions involved. It did
not merely request an encroachment upon the rights of the people, but it, in effect,
encouraged further violations thereof during the martial law regime. I am sure the
members of the Bar are familiar with this situation. But for the benefit of the Members of
the Commission who are not lawyers, allow me to explain. I will start with a decision of
the Supreme Court in 1973 on the case of Javellana vs. the Secretary of Justice, if I am
not mistaken. Martial law was announced on September 22, although the proclamation
was dated September 21. The obvious reason for the delay in its publication was that the
administration had apprehended and detained prominent newsmen on September 21. So
that when martial law was announced on September 22, the media hardly published
anything about it. In fact, the media could not publish any story not only because our
main writers were already incarcerated, but also because those who succeeded them in
their jobs were under mortal threat of being the object of wrath of the ruling party. The
1971 Constitutional Convention had begun on June 1, 1971 and by September 21 or 22
had not finished the Constitution; it had barely agreed in the fundamentals of the
Constitution. I forgot to say that upon the proclamation of martial law, some delegates to
that 1971 Constitutional Convention, dozens of them, were picked up. One of them was
our very own colleague, Commissioner Calderon. So, the unfinished draft of the
Constitution was taken over by representatives of Malacañang. In 17 days, they finished
what the delegates to the 1971 Constitutional Convention had been unable to accomplish
for about 14 months. The draft of the 1973 Constitution was presented to the President
around December 1, 1972, whereupon the President issued a decree calling a plebiscite
which suspended the operation of some provisions in the martial law decree which
prohibited discussions, much less public discussions of certain matters of public concern.
The purpose was presumably to allow a free discussion on the draft of the Constitution on
which a plebiscite was to be held sometime in January 1973. If I may use a word famous
by our colleague, Commissioner Ople, during the interregnum, however, the draft of the
Constitution was analyzed and criticized with such a telling effect that Malacañang felt
the danger of its approval. So, the President suspended indefinitely the holding of the
plebiscite and announced that he would consult the people in a referendum to be held
from January 10 to January 15. But the questions to be submitted in the referendum were
not announced until the eve of its scheduled beginning, under the supposed supervision
not of the Commission on Elections, but of what was then designated as "citizens
assemblies or barangays." Thus the barangays came into existence. The questions to be
propounded were released with proposed answers thereto, suggesting that it was
unnecessary to hold a plebiscite because the answers given in the referendum should be
regarded as the votes cast in the plebiscite. Thereupon, a motion was filed with the
Supreme Court praying that the holding of the referendum be suspended. When the
motion was being heard before the Supreme Court, the Minister of Justice delivered to
the Court a proclamation of the President declaring that the new Constitution was already
in force because the overwhelming majority of the votes cast in the referendum favored
the Constitution. Immediately after the departure of the Minister of Justice, I proceeded
to the session room where the case was being heard. I then informed the Court and the
parties the presidential proclamation declaring that the 1973 Constitution had been
ratified by the people and is now in force.

A number of other cases were filed to declare the presidential proclamation null and void.
The main defense put up by the government was that the issue was a political question
and that the court had no jurisdiction to entertain the case.

xxx

The government said that in a referendum held from January 10 to January 15, the vast
majority ratified the draft of the Constitution. Note that all members of the Supreme
Court were residents of Manila, but none of them had been notified of any referendum in
their respective places of residence, much less did they participate in the alleged
referendum. None of them saw any referendum proceeding.

In the Philippines, even local gossips spread like wild fire. So, a majority of the members
of the Court felt that there had been no referendum.

Second, a referendum cannot substitute for a plebiscite. There is a big difference

between a referendum and a plebiscite. But another group of justices upheld the
defense that the issue was a political question. Whereupon, they dismissed the case.
This is not the only major case in which the plea of "political question" was set up.
There have been a number of other cases in the past.
 x x x The defense of the political question was rejected because the issue was clearly
justiciable.

xxx

x x x When your Committee on the Judiciary began to perform its functions, it faced the
following questions: What is judicial power? What is a political question?

The Supreme Court, like all other courts, has one main function: to settle actual
controversies involving conflicts of rights which are demandable and enforceable. There
are rights which are guaranteed by law but cannot be enforced by a judiciary party. In a
decided case, a husband complained that his wife was unwilling to perform her duties as
a wife. The Court said: "We can tell your wife what her duties as such are and that she is
bound to comply with them, but we cannot force her physically to discharge her main
marital duty to her husband. There are some rights guaranteed by law, but they are so
personal that to enforce them by actual compulsion would be highly derogatory to human
dignity."

This is why the first part of the second paragraph of Section I provides that:

Judicial power includes the duty of courts to settle actual controversies involving rights
which are legally demandable or enforceable . . .

The courts, therefore, cannot entertain, much less decide, hypothetical questions. In a
presidential system of government, the Supreme Court has, also another important
function. The powers of government are generally considered divided into three
branches: the Legislative, the Executive and the Judiciary. Each one is supreme
within its own sphere and independent of the others. Because of that supremacy
power to determine whether a given law is valid or not is vested in courts of justice.

Briefly stated, courts of justice determine the limits of power of the agencies and
offices of the government as well as those of its officers. In other words, the
judiciary is the final arbiter on the question whether or not a branch of government
or any of its officials has acted without jurisdiction or in excess of jurisdiction, or so
capriciously as to constitute an abuse of discretion amounting to excess of
jurisdiction or lack of jurisdiction. This is not only a judicial power but a duty to
pass judgment on matters of this nature.

This is the background of paragraph 2 of Section 1, which means that the courts
cannot hereafter evade the duty to settle matters of this nature, by claiming that
such matters constitute a political question.

I have made these extended remarks to the end that the Commissioners may have an
initial food for thought on the subject of the judiciary.103 (Italics in the original; emphasis
supplied)

During the deliberations of the Constitutional Commission, Chief Justice Concepcion further
clarified the concept of judicial power, thus:
MR. NOLLEDO. The Gentleman used the term "judicial power" but judicial power
is not vested in the Supreme Court alone but also in other lower courts as may be
created by law.

MR. CONCEPCION. Yes.

MR. NOLLEDO. And so, is this only an example?

MR. CONCEPCION. No, I know this is not. The Gentleman seems to identify
political questions with jurisdictional questions. But there is a difference.

MR. NOLLEDO. Because of the expression "judicial power"?

MR. CONCEPCION. No. Judicial power, as I said, refers to ordinary cases but
where there is a question as to whether the government had authority or had abused
its authority to the extent of lacking jurisdiction or excess of jurisdiction, that is not
a political question. Therefore, the court has the duty to decide.

xxx

FR. BERNAS. Ultimately, therefore, it will always have to be decided by the Supreme
Court according to the new numerical need for votes.

On another point, is it the intention of Section 1 to do away with the political question
doctrine?

MR. CONCEPCION. No.

FR. BERNAS. It is not.

MR. CONCEPCION. No, because whenever there is an abuse of discretion,

amounting to a lack of jurisdiction. . .

FR. BERNAS. So, I am satisfied with the answer that it is not intended to do away
with the political question doctrine.

MR. CONCEPCION. No, certainly not.

When this provision was originally drafted, it sought to define what is judicial
power. But the Gentleman will notice it says, "judicial power includes" and the
reason being that the definition that we might make may not cover all possible
areas.

FR. BERNAS. So, this is not an attempt to solve the problems arising from the
political question doctrine.

MR. CONCEPCION. It definitely does not eliminate the fact that truly political
questions are beyond the pale of judicial power.104 (Emphasis supplied)
From the foregoing record of the proceedings of the 1986 Constitutional Commission, it is clear
that judicial power is not only a power; it is also a duty, a duty which cannot be abdicated by the
mere specter of this creature called the political question doctrine. Chief Justice Concepcion
hastened to clarify, however, that Section 1, Article VIII was not intended to do away with "truly
political questions." From this clarification it is gathered that there are two species of political
questions: (1) "truly political questions" and (2) those which "are not truly political questions."

Truly political questions are thus beyond judicial review, the reason for respect of the doctrine of
separation of powers to be maintained. On the other hand, by virtue of Section 1, Article VIII of
the Constitution, courts can review questions which are not truly political in nature.

As pointed out by amicus curiae former dean Pacifico Agabin of the UP College of Law, this
Court has in fact in a number of cases taken jurisdiction over questions which are not truly
political following the effectivity of the present Constitution.

In Marcos v. Manglapus,105 this Court, speaking through Madame Justice Irene Cortes, held:

The present Constitution limits resort to the political question doctrine and broadens the
scope of judicial inquiry into areas which the Court, under previous constitutions, would
have normally left to the political departments to decide.106 x x x

In Bengzon v. Senate Blue Ribbon Committee,107 through Justice Teodoro Padilla, this Court
declared:

The "allocation of constitutional boundaries" is a task that this Court must perform under
the Constitution. Moreover, as held in a recent case, "(t)he political question doctrine
neither interposes an obstacle to judicial determination of the rival claims. The
jurisdiction to delimit constitutional boundaries has been given to this Court. It
cannot abdicate that obligation mandated by the 1987 Constitution, although said
provision by no means does away with the applicability of the principle in
appropriate cases."108 (Emphasis and underscoring supplied)

And in Daza v. Singson,109 speaking through Justice Isagani Cruz, this Court ruled:

In the case now before us, the jurisdictional objection becomes even less tenable and
decisive. The reason is that, even if we were to assume that the issue presented before us
was political in nature, we would still not be precluded from resolving it under the
expanded jurisdiction conferred upon us that now covers, in proper cases, even the
political question.110 x x x (Emphasis and underscoring supplied.)

Section 1, Article VIII, of the Court does not define what are justiciable political questions and
non-justiciable political questions, however. Identification of these two species of political
questions may be problematic. There has been no clear standard. The American case of Baker v.
Carr111 attempts to provide some:

x x x Prominent on the surface of any case held to involve a political question is found a
textually demonstrable constitutional commitment of the issue to a coordinate political
department; or a lack of judicially discoverable and manageable standards for resolving
it; or the impossibility of deciding without an initial policy determination of a kind
clearly for non-judicial discretion; or the impossibility of a court's undertaking
 independent resolution without expressing lack of the respect due coordinate branches of
government; or an unusual need for questioning adherence to a political decision already
made; or the potentiality of embarrassment from multifarious pronouncements by various
departments on one question.112 (Underscoring supplied)

Of these standards, the more reliable have been the first three: (1) a textually demonstrable
constitutional commitment of the issue to a coordinate political department; (2) the lack of
judicially discoverable and manageable standards for resolving it; and (3) the impossibility of
deciding without an initial policy determination of a kind clearly for non-judicial discretion.
These standards are not separate and distinct concepts but are interrelated to each in that the
presence of one strengthens the conclusion that the others are also present.

The problem in applying the foregoing standards is that the American concept of judicial review
is radically different from our current concept, for Section 1, Article VIII of the Constitution
provides our courts with far less discretion in determining whether they should pass upon a
constitutional issue.

In our jurisdiction, the determination of a truly political question from a non-justiciable political
question lies in the answer to the question of whether there are constitutionally imposed limits on
powers or functions conferred upon political bodies. If there are, then our courts are duty-bound
to examine whether the branch or instrumentality of the government properly acted within such
limits. This Court shall thus now apply this standard to the present controversy.

These petitions raise five substantial issues:

I. Whether the offenses alleged in the Second impeachment complaint constitute valid
impeachable offenses under the Constitution.

II. Whether the second impeachment complaint was filed in accordance with Section
3(4), Article XI of the Constitution.

III. Whether the legislative inquiry by the House Committee on Justice into the Judicial
Development Fund is an unconstitutional infringement of the constitutionally mandated
fiscal autonomy of the judiciary.

IV. Whether Sections 15 and 16 of Rule V of the Rules on Impeachment adopted by the
12th Congress are unconstitutional for violating the provisions of Section 3, Article XI of
the Constitution.

V. Whether the second impeachment complaint is barred under Section 3(5) of Article XI
of the Constitution.

The first issue goes into the merits of the second impeachment complaint over which this
Court has no jurisdiction. More importantly, any discussion of this issue would require
this Court to make a determination of what constitutes an impeachable offense. Such a
determination is a purely political question which the Constitution has left to the sound
discretion of the legislation. Such an intent is clear from the deliberations of the
Constitutional Commission.113
Although Section 2 of Article XI of the Constitution enumerates six grounds for impeachment,
two of these, namely, other high crimes and betrayal of public trust, elude a precise definition. In
fact, an examination of the records of the 1986 Constitutional Commission shows that the
framers could find no better way to approximate the boundaries of betrayal of public trust and
other high crimes than by alluding to both positive and negative examples of both, without
arriving at their clear cut definition or even a standard therefor.114 Clearly, the issue calls upon
this court to decide a non-justiciable political question which is beyond the scope of its judicial
power under Section 1, Article VIII.

Lis Mota

It is a well-settled maxim of adjudication that an issue assailing the constitutionality of a

governmental act should be avoided whenever possible. Thus, in the case of Sotto v. Commission
on Elections,115 this Court held:

x x x It is a well-established rule that a court should not pass upon a constitutional

question and decide a law to be unconstitutional or invalid, unless such question is raised
by the parties and that when it is raised, if the record also presents some other ground
upon which the court may rest its judgment, that course will be adopted and the
constitutional question will be left for consideration until a case arises in which a
decision upon such question will be unavoidable.116 [Emphasis and underscoring
supplied]

The same principle was applied in Luz Farms v. Secretary of Agrarian Reform,117 where this
Court invalidated Sections 13 and 32 of Republic Act No. 6657 for being confiscatory and
violative of due process, to wit:

It has been established that this Court will assume jurisdiction over a constitutional
question only if it is shown that the essential requisites of a judicial inquiry into such
a question are first satisfied. Thus, there must be an actual case or controversy
involving a conflict of legal rights susceptible of judicial determination, the constitutional
question must have been opportunely raised by the proper party, and the resolution of
the question is unavoidably necessary to the decision of the case itself.118 [Emphasis
supplied]

Succinctly put, courts will not touch the issue of constitutionality unless it is truly unavoidable
and is the very lis mota or crux of the controversy.

As noted earlier, the instant consolidated petitions, while all seeking the invalidity of the second
impeachment complaint, collectively raise several constitutional issues upon which the outcome
of this controversy could possibly be made to rest. In determining whether one, some or all of the
remaining substantial issues should be passed upon, this Court is guided by the related cannon of
adjudication that "the court should not form a rule of constitutional law broader than is required
by the precise facts to which it is applied."119

In G.R. No. 160310, petitioners Leonilo R. Alfonso, et al. argue that, among other reasons, the
second impeachment complaint is invalid since it directly resulted from a Resolution120 calling
for a legislative inquiry into the JDF, which Resolution and legislative inquiry petitioners claim
to likewise be unconstitutional for being: (a) a violation of the rules and jurisprudence on
investigations in aid of legislation; (b) an open breach of the doctrine of separation of powers; (c)
a violation of the constitutionally mandated fiscal autonomy of the judiciary; and (d) an assault
on the independence of the judiciary.121

Without going into the merits of petitioners Alfonso, et. al.'s claims, it is the studied opinion of
this Court that the issue of the constitutionality of the said Resolution and resulting legislative
inquiry is too far removed from the issue of the validity of the second impeachment complaint.
Moreover, the resolution of said issue would, in the Court's opinion, require it to form a rule of
constitutional law touching on the separate and distinct matter of legislative inquiries in general,
which would thus be broader than is required by the facts of these consolidated cases. This
opinion is further strengthened by the fact that said petitioners have raised other grounds in
support of their petition which would not be adversely affected by the Court's ruling.

En passant, this Court notes that a standard for the conduct of legislative inquiries has already
been enunciated by this Court in Bengzon, Jr. v. Senate Blue Ribbon Commttee,122 viz:

The 1987 Constitution expressly recognizes the power of both houses of Congress to
conduct inquiries in aid of legislation. Thus, Section 21, Article VI thereof provides:

The Senate or the House of Representatives or any of its respective committees may
conduct inquiries in aid of legislation in accordance with its duly published rules of
procedure. The rights of persons appearing in or affected by such inquiries shall be
respected.

The power of both houses of Congress to conduct inquiries in aid of legislation is not,
therefore absolute or unlimited. Its exercise is circumscribed by the afore-quoted
provision of the Constitution. Thus, as provided therein, the investigation must be "in aid
of legislation in accordance with its duly published rules of procedure" and that "the
rights of persons appearing in or affected by such inquiries shall be respected." It follows
then that the right rights of persons under the Bill of Rights must be respected, including
the right to due process and the right not be compelled to testify against one's self.123

In G.R. No. 160262, intervenors Romulo B. Macalintal and Pete Quirino Quadra, while joining
the original petition of petitioners Candelaria, et. al., introduce the new argument that since the
second impeachment complaint was verified and filed only by Representatives Gilberto Teodoro,
Jr. and Felix William Fuentebella, the same does not fall under the provisions of Section 3 (4),
Article XI of the Constitution which reads:

Section 3(4) In case the verified complaint or resolution of impeachment is filed by at

least one-third of all the Members of the House, the same shall constitute the Articles of
Impeachment, and trial by the Senate shall forthwith proceed.

They assert that while at least 81 members of the House of Representatives signed a Resolution
of Endorsement/Impeachment, the same did not satisfy the requisites for the application of the
afore-mentioned section in that the "verified complaint or resolution of impeachment" was not
filed "by at least one-third of all the Members of the House." With the exception of
Representatives Teodoro and Fuentebella, the signatories to said Resolution are alleged to have
verified the same merely as a "Resolution of Endorsement." Intervenors point to the
"Verification" of the Resolution of Endorsement which states that:
 "We are the proponents/sponsors of the Resolution of Endorsement of the
abovementioned Complaint of Representatives Gilberto Teodoro and Felix William B.
Fuentebella x x x"124

Intervenors Macalintal and Quadra further claim that what the Constitution requires in order for
said second impeachment complaint to automatically become the Articles of Impeachment and
for trial in the Senate to begin "forthwith," is that the verified complaint be "filed," not merely
endorsed, by at least one-third of the Members of the House of Representatives. Not having
complied with this requirement, they concede that the second impeachment complaint should
have been calendared and referred to the House Committee on Justice under Section 3(2), Article
XI of the Constitution, viz:

Section 3(2) A verified complaint for impeachment may be filed by any Member of the
House of Representatives or by any citizen upon a resolution of endorsement by any
Member thereof, which shall be included in the Order of Business within ten session
days, and referred to the proper Committee within three session days thereafter. The
Committee, after hearing, and by a majority vote of all its Members, shall submit its
report to the House within sixty session days from such referral, together with the
corresponding resolution. The resolution shall be calendared for consideration by the
House within ten session days from receipt thereof.

Intervenors' foregoing position is echoed by Justice Maambong who opined that for Section 3
(4), Article XI of the Constitution to apply, there should be 76 or more representatives who
signed and verified the second impeachment complaint as complainants, signed and verified the
signatories to a resolution of impeachment. Justice Maambong likewise asserted that the
Resolution of Endorsement/Impeachment signed by at least one-third of the members of the
House of Representatives as endorsers is not the resolution of impeachment contemplated by the
Constitution, such resolution of endorsement being necessary only from at least one Member
whenever a citizen files a verified impeachment complaint.

While the foregoing issue, as argued by intervenors Macalintal and Quadra, does indeed limit the
scope of the constitutional issues to the provisions on impeachment, more compelling
considerations militate against its adoption as the lis mota or crux of the present controversy.
Chief among this is the fact that only Attorneys Macalintal and Quadra, intervenors in G.R. No.
160262, have raised this issue as a ground for invalidating the second impeachment complaint.
Thus, to adopt this additional ground as the basis for deciding the instant consolidated petitions
would not only render for naught the efforts of the original petitioners in G.R. No. 160262, but
the efforts presented by the other petitioners as well.

Again, the decision to discard the resolution of this issue as unnecessary for the determination of
the instant cases is made easier by the fact that said intervenors Macalintal and Quadra have
joined in the petition of Candelaria, et. al., adopting the latter's arguments and issues as their
own. Consequently, they are not unduly prejudiced by this Court's decision.

In sum, this Court holds that the two remaining issues, inextricably linked as they are, constitute
the very lis mota of the instant controversy: (1) whether Sections 15 and 16 of Rule V of the
House Impeachment Rules adopted by the 12th Congress are unconstitutional for violating the
provisions of Section 3, Article XI of the Constitution; and (2) whether, as a result thereof, the
second impeachment complaint is barred under Section 3(5) of Article XI of the Constitution.
Judicial Restraint

Senator Pimentel urges this Court to exercise judicial restraint on the ground that the Senate,
sitting as an impeachment court, has the sole power to try and decide all cases of impeachment.
Again, this Court reiterates that the power of judicial review includes the power of review over
justiciable issues in impeachment proceedings.

On the other hand, respondents Speaker De Venecia et. al. argue that "[t]here is a moral
compulsion for the Court to not assume jurisdiction over the impeachment because all the
Members thereof are subject to impeachment."125 But this argument is very much like saying the
Legislature has a moral compulsion not to pass laws with penalty clauses because Members of
the House of Representatives are subject to them.

The exercise of judicial restraint over justiciable issues is not an option before this Court.
Adjudication may not be declined, because this Court is not legally disqualified. Nor can
jurisdiction be renounced as there is no other tribunal to which the controversy may be
referred."126 Otherwise, this Court would be shirking from its duty vested under Art. VIII, Sec.
1(2) of the Constitution. More than being clothed with authority thus, this Court is duty-bound to
take cognizance of the instant petitions.127 In the august words of amicus curiae Father Bernas,
"jurisdiction is not just a power; it is a solemn duty which may not be renounced. To renounce it,
even if it is vexatious, would be a dereliction of duty."

Even in cases where it is an interested party, the Court under our system of government cannot
inhibit itself and must rule upon the challenge because no other office has the authority to do
so.128 On the occasion that this Court had been an interested party to the controversy before it, it
has acted upon the matter "not with officiousness but in the discharge of an unavoidable duty
and, as always, with detachment and fairness."129 After all, "by [his] appointment to the office,
the public has laid on [a member of the judiciary] their confidence that [he] is mentally and
morally fit to pass upon the merits of their varied contentions. For this reason, they expect [him]
to be fearless in [his] pursuit to render justice, to be unafraid to displease any person, interest or
power and to be equipped with a moral fiber strong enough to resist the temptations lurking in
[his] office."130

The duty to exercise the power of adjudication regardless of interest had already been settled in
the case of Abbas v. Senate Electoral Tribunal.131 In that case, the petitioners filed with the
respondent Senate Electoral Tribunal a Motion for Disqualification or Inhibition of the Senators-
Members thereof from the hearing and resolution of SET Case No. 002-87 on the ground that all
of them were interested parties to said case as respondents therein. This would have reduced the
Tribunal's membership to only its three Justices-Members whose disqualification was not sought,
leaving them to decide the matter. This Court held:

Where, as here, a situation is created which precludes the substitution of any Senator
sitting in the Tribunal by any of his other colleagues in the Senate without inviting the
same objections to the substitute's competence, the proposed mass disqualification, if
sanctioned and ordered, would leave the Tribunal no alternative but to abandon a duty
that no other court or body can perform, but which it cannot lawfully discharge if shorn
of the participation of its entire membership of Senators.

To our mind, this is the overriding consideration — that the Tribunal be not prevented
from discharging a duty which it alone has the power to perform, the performance of
 which is in the highest public interest as evidenced by its being expressly imposed by no
less than the fundamental law.

It is aptly noted in the first of the questioned Resolutions that the framers of the
Constitution could not have been unaware of the possibility of an election contest that
would involve all Senators—elect, six of whom would inevitably have to sit in judgment
thereon. Indeed, such possibility might surface again in the wake of the 1992 elections
when once more, but for the last time, all 24 seats in the Senate will be at stake. Yet the
Constitution provides no scheme or mode for settling such unusual situations or for the
substitution of Senators designated to the Tribunal whose disqualification may be sought.
Litigants in such situations must simply place their trust and hopes of vindication in the
fairness and sense of justice of the Members of the Tribunal. Justices and Senators, singly
and collectively.

Let us not be misunderstood as saying that no Senator-Member of the Senate Electoral

Tribunal may inhibit or disqualify himself from sitting in judgment on any case before
said Tribunal. Every Member of the Tribunal may, as his conscience dictates, refrain
from participating in the resolution of a case where he sincerely feels that his personal
interests or biases would stand in the way of an objective and impartial judgment. What
we are merely saying is that in the light of the Constitution, the Senate Electoral Tribunal
cannot legally function as such, absent its entire membership of Senators and that no
amendment of its Rules can confer on the three Justices-Members alone the power of
valid adjudication of a senatorial election contest.

More recently in the case of Estrada v. Desierto,132 it was held that:

Moreover, to disqualify any of the members of the Court, particularly a majority of them,
is nothing short of pro tanto depriving the Court itself of its jurisdiction as established by
the fundamental law. Disqualification of a judge is a deprivation of his judicial power.
And if that judge is the one designated by the Constitution to exercise the jurisdiction of
his court, as is the case with the Justices of this Court, the deprivation of his or their
judicial power is equivalent to the deprivation of the judicial power of the court itself. It
affects the very heart of judicial independence. The proposed mass disqualification, if
sanctioned and ordered, would leave the Court no alternative but to abandon a duty which
it cannot lawfully discharge if shorn of the participation of its entire membership of
Justices.133 (Italics in the original)

Besides, there are specific safeguards already laid down by the Court when it exercises its power
of judicial review.

In Demetria v. Alba,134 this Court, through Justice Marcelo Fernan cited the "seven pillars" of
limitations of the power of judicial review, enunciated by US Supreme Court Justice Brandeis in
Ashwander v. TVA135 as follows:

1. The Court will not pass upon the constitutionality of legislation in a friendly, non-
adversary proceeding, declining because to decide such questions 'is legitimate only in
the last resort, and as a necessity in the determination of real, earnest and vital
controversy between individuals. It never was the thought that, by means of a friendly
suit, a party beaten in the legislature could transfer to the courts an inquiry as to the
constitutionality of the legislative act.'
 2. The Court will not 'anticipate a question of constitutional law in advance of the
necessity of deciding it.' . . . 'It is not the habit of the Court to decide questions of a
constitutional nature unless absolutely necessary to a decision of the case.'

3. The Court will not 'formulate a rule of constitutional law broader than is required by
the precise facts to which it is to be applied.'

4. The Court will not pass upon a constitutional question although properly presented by
the record, if there is also present some other ground upon which the case may be
disposed of. This rule has found most varied application. Thus, if a case can be decided
on either of two grounds, one involving a constitutional question, the other a question of
statutory construction or general law, the Court will decide only the latter. Appeals from
the highest court of a state challenging its decision of a question under the Federal
Constitution are frequently dismissed because the judgment can be sustained on an
independent state ground.

5. The Court will not pass upon the validity of a statute upon complaint of one who fails
to show that he is injured by its operation. Among the many applications of this rule,
none is more striking than the denial of the right of challenge to one who lacks a personal
or property right. Thus, the challenge by a public official interested only in the
performance of his official duty will not be entertained . . . In Fairchild v. Hughes, the
Court affirmed the dismissal of a suit brought by a citizen who sought to have the
Nineteenth Amendment declared unconstitutional. In Massachusetts v. Mellon, the
challenge of the federal Maternity Act was not entertained although made by the
Commonwealth on behalf of all its citizens.

6. The Court will not pass upon the constitutionality of a statute at the instance of one
who has availed himself of its benefits.

7. When the validity of an act of the Congress is drawn in question, and even if a serious
doubt of constitutionality is raised, it is a cardinal principle that this Court will first
ascertain whether a construction of the statute is fairly possible by which the question
may be avoided (citations omitted).

The foregoing "pillars" of limitation of judicial review, summarized in Ashwander v. TVA from
different decisions of the United States Supreme Court, can be encapsulated into the following
categories:

1. that there be absolute necessity of deciding a case

2. that rules of constitutional law shall be formulated only as required by the facts of the
case

3. that judgment may not be sustained on some other ground

4. that there be actual injury sustained by the party by reason of the operation of the
statute

5. that the parties are not in estoppel

 6. that the Court upholds the presumption of constitutionality.

As stated previously, parallel guidelines have been adopted by this Court in the exercise of
judicial review:

1. actual case or controversy calling for the exercise of judicial power

2. the person challenging the act must have "standing" to challenge; he must have a
personal and substantial interest in the case such that he has sustained, or will sustain,
direct injury as a result of its enforcement

3. the question of constitutionality must be raised at the earliest possible opportunity

4. the issue of constitutionality must be the very lis mota of the case.136

Respondents Speaker de Venecia, et. al. raise another argument for judicial restraint the
possibility that "judicial review of impeachments might also lead to embarrassing conflicts
between the Congress and the [J]udiciary." They stress the need to avoid the appearance of
impropriety or conflicts of interest in judicial hearings, and the scenario that it would be
confusing and humiliating and risk serious political instability at home and abroad if the
judiciary countermanded the vote of Congress to remove an impeachable official.137 Intervenor
Soriano echoes this argument by alleging that failure of this Court to enforce its Resolution
against Congress would result in the diminution of its judicial authority and erode public
confidence and faith in the judiciary.

Such an argument, however, is specious, to say the least. As correctly stated by the Solicitor
General, the possibility of the occurrence of a constitutional crisis is not a reason for this Court to
refrain from upholding the Constitution in all impeachment cases. Justices cannot abandon their
constitutional duties just because their action may start, if not precipitate, a crisis.

Justice Feliciano warned against the dangers when this Court refuses to act.

x x x Frequently, the fight over a controversial legislative or executive act is not regarded
as settled until the Supreme Court has passed upon the constitutionality of the act
involved, the judgment has not only juridical effects but also political consequences.
Those political consequences may follow even where the Court fails to grant the
petitioner's prayer to nullify an act for lack of the necessary number of votes. Frequently,
failure to act explicitly, one way or the other, itself constitutes a decision for the
respondent and validation, or at least quasi-validation, follows." 138

Thus, in Javellana v. Executive Secretary139 where this Court was split and "in the end there
were not enough votes either to grant the petitions, or to sustain respondent's claims,"140 the pre-
existing constitutional order was disrupted which paved the way for the establishment of the
martial law regime.

Such an argument by respondents and intervenor also presumes that the coordinate branches of
the government would behave in a lawless manner and not do their duty under the law to uphold
the Constitution and obey the laws of the land. Yet there is no reason to believe that any of the
branches of government will behave in a precipitate manner and risk social upheaval, violence,
chaos and anarchy by encouraging disrespect for the fundamental law of the land.
Substituting the word public officers for judges, this Court is well guided by the doctrine in
People v. Veneracion, to wit:141

Obedience to the rule of law forms the bedrock of our system of justice. If [public
officers], under the guise of religious or political beliefs were allowed to roam
unrestricted beyond boundaries within which they are required by law to exercise the
duties of their office, then law becomes meaningless. A government of laws, not of men
excludes the exercise of broad discretionary powers by those acting under its authority.
Under this system, [public officers] are guided by the Rule of Law, and ought "to protect
and enforce it without fear or favor," resist encroachments by governments, political
parties, or even the interference of their own personal beliefs.142

Constitutionality of the Rules of Procedure

for Impeachment Proceedings
adopted by the 12th Congress

Respondent House of Representatives, through Speaker De Venecia, argues that Sections 16 and
17 of Rule V of the House Impeachment Rules do not violate Section 3 (5) of Article XI of our
present Constitution, contending that the term "initiate" does not mean "to file;" that Section 3
(1) is clear in that it is the House of Representatives, as a collective body, which has the
exclusive power to initiate all cases of impeachment; that initiate could not possibly mean "to
file" because filing can, as Section 3 (2), Article XI of the Constitution provides, only be
accomplished in 3 ways, to wit: (1) by a verified complaint for impeachment by any member of
the House of Representatives; or (2) by any citizen upon a resolution of endorsement by any
member; or (3) by at least 1/3 of all the members of the House. Respondent House of
Representatives concludes that the one year bar prohibiting the initiation of impeachment
proceedings against the same officials could not have been violated as the impeachment
complaint against Chief Justice Davide and seven Associate Justices had not been initiated as the
House of Representatives, acting as the collective body, has yet to act on it.

The resolution of this issue thus hinges on the interpretation of the term "initiate." Resort to
statutory construction is, therefore, in order.

That the sponsor of the provision of Section 3(5) of the Constitution, Commissioner Florenz
Regalado, who eventually became an Associate Justice of this Court, agreed on the meaning of
"initiate" as "to file," as proffered and explained by Constitutional Commissioner Maambong
during the Constitutional Commission proceedings, which he (Commissioner Regalado) as
amicus curiae affirmed during the oral arguments on the instant petitions held on November 5,
2003 at which he added that the act of "initiating" included the act of taking initial action on the
complaint, dissipates any doubt that indeed the word "initiate" as it twice appears in Article XI
(3) and (5) of the Constitution means to file the complaint and take initial action on it.

"Initiate" of course is understood by ordinary men to mean, as dictionaries do, to begin, to

commence, or set going. As Webster's Third New International Dictionary of the English
Language concisely puts it, it means "to perform or facilitate the first action," which jibes with
Justice Regalado's position, and that of Father Bernas, who elucidated during the oral arguments
of the instant petitions on November 5, 2003 in this wise:

Briefly then, an impeachment proceeding is not a single act. It is a comlexus of acts

consisting of a beginning, a middle and an end. The end is the transmittal of the articles
 of impeachment to the Senate. The middle consists of those deliberative moments leading
to the formulation of the articles of impeachment. The beginning or the initiation is the
filing of the complaint and its referral to the Committee on Justice.

Finally, it should be noted that the House Rule relied upon by Representatives Cojuangco
and Fuentebella says that impeachment is "deemed initiated" when the Justice
Committee votes in favor of impeachment or when the House reverses a contrary vote of
the Committee. Note that the Rule does not say "impeachment proceedings" are initiated
but rather are "deemed initiated." The language is recognition that initiation happened
earlier, but by legal fiction there is an attempt to postpone it to a time after actual
initiation. (Emphasis and underscoring supplied)

As stated earlier, one of the means of interpreting the Constitution is looking into the intent of
the law. Fortunately, the intent of the framers of the 1987 Constitution can be pried from its
records:

MR. MAAMBONG. With reference to Section 3, regarding the procedure and the
substantive provisions on impeachment, I understand there have been many proposals
and, I think, these would need some time for Committee action.

However, I would just like to indicate that I submitted to the Committee a resolution on
impeachment proceedings, copies of which have been furnished the Members of this
body. This is borne out of my experience as a member of the Committee on Justice,
Human Rights and Good Government which took charge of the last impeachment
resolution filed before the First Batasang Pambansa. For the information of the
Committee, the resolution covers several steps in the impeachment proceedings
starting with initiation, action of the Speaker committee action, calendaring of
report, voting on the report, transmittal referral to the Senate, trial and judgment
by the Senate.

xxx

MR. MAAMBONG. Mr. Presiding Officer, I am not moving for a reconsideration of the
approval of the amendment submitted by Commissioner Regalado, but I will just make of
record my thinking that we do not really initiate the filing of the Articles of Impeachment
on the floor. The procedure, as I have pointed out earlier, was that the initiation
starts with the filing of the complaint. And what is actually done on the floor is that
the committee resolution containing the Articles of Impeachment is the one
approved by the body.

As the phraseology now runs, which may be corrected by the Committee on Style, it
appears that the initiation starts on the floor. If we only have time, I could cite examples
in the case of the impeachment proceedings of President Richard Nixon wherein the
Committee on the Judiciary submitted the recommendation, the resolution, and the
Articles of Impeachment to the body, and it was the body who approved the resolution. It
is not the body which initiates it. It only approves or disapproves the resolution. So,
on that score, probably the Committee on Style could help in rearranging these words
because we have to be very technical about this. I have been bringing with me The Rules
of the House of Representatives of the U.S. Congress. The Senate Rules are with me. The
 proceedings on the case of Richard Nixon are with me. I have submitted my proposal, but
the Committee has already decided. Nevertheless, I just want to indicate this on record.

xxx

MR. MAAMBONG. I would just like to move for a reconsideration of the approval of
Section 3 (3). My reconsideration will not at all affect the substance, but it is only in
keeping with the exact formulation of the Rules of the House of Representatives of the
United States regarding impeachment.

I am proposing, Madam President, without doing damage to any of this provision, that on
page 2, Section 3 (3), from lines 17 to 18, we delete the words which read: "to initiate
impeachment proceedings" and the comma (,) and insert on line 19 after the word
"resolution" the phrase WITH THE ARTICLES, and then capitalize the letter "i" in
"impeachment" and replace the word "by" with OF, so that the whole section will now
read: "A vote of at least one-third of all the Members of the House shall be necessary
either to affirm a resolution WITH THE ARTICLES of Impeachment OF the Committee
or to override its contrary resolution. The vote of each Member shall be recorded."

I already mentioned earlier yesterday that the initiation, as far as the House of
Representatives of the United States is concerned, really starts from the filing of the
verified complaint and every resolution to impeach always carries with it the Articles of
Impeachment. As a matter of fact, the words "Articles of Impeachment" are mentioned on
line 25 in the case of the direct filing of a verified compliant of one-third of all the
Members of the House. I will mention again, Madam President, that my amendment will
not vary the substance in any way. It is only in keeping with the uniform procedure of the
House of Representatives of the United States Congress. Thank you, Madam President.143
(Italics in the original; emphasis and udnerscoring supplied)

This amendment proposed by Commissioner Maambong was clarified and accepted by the
Committee on the Accountability of Public Officers.144

It is thus clear that the framers intended "initiation" to start with the filing of the complaint. In
his amicus curiae brief, Commissioner Maambong explained that "the obvious reason in deleting
the phrase "to initiate impeachment proceedings" as contained in the text of the provision of
Section 3 (3) was to settle and make it understood once and for all that the initiation of
impeachment proceedings starts with the filing of the complaint, and the vote of one-third of
the House in a resolution of impeachment does not initiate the impeachment proceedings which
was already initiated by the filing of a verified complaint under Section 3, paragraph (2),
Article XI of the Constitution."145

Amicus curiae Constitutional Commissioner Regalado is of the same view as is Father Bernas,
who was also a member of the 1986 Constitutional Commission, that the word "initiate" as used
in Article XI, Section 3(5) means to file, both adding, however, that the filing must be
accompanied by an action to set the complaint moving.

During the oral arguments before this Court, Father Bernas clarified that the word "initiate,"
appearing in the constitutional provision on impeachment, viz:
 Section 3 (1) The House of Representatives shall have the exclusive power to initiate all
cases of impeachment.

xxx

(5) No impeachment proceedings shall be initiated against the same official more than
once within a period of one year, (Emphasis supplied)

refers to two objects, "impeachment case" and "impeachment proceeding."

Father Bernas explains that in these two provisions, the common verb is "to initiate." The object
in the first sentence is "impeachment case." The object in the second sentence is "impeachment
proceeding." Following the principle of reddendo singuala sinuilis, the term "cases" must be
distinguished from the term "proceedings." An impeachment case is the legal controversy that
must be decided by the Senate. Above-quoted first provision provides that the House, by a vote
of one-third of all its members, can bring a case to the Senate. It is in that sense that the House
has "exclusive power" to initiate all cases of impeachment. No other body can do it. However,
before a decision is made to initiate a case in the Senate, a "proceeding" must be followed to
arrive at a conclusion. A proceeding must be "initiated." To initiate, which comes from the Latin
word initium, means to begin. On the other hand, proceeding is a progressive noun. It has a
beginning, a middle, and an end. It takes place not in the Senate but in the House and consists of
several steps: (1) there is the filing of a verified complaint either by a Member of the House of
Representatives or by a private citizen endorsed by a Member of the House of the
Representatives; (2) there is the processing of this complaint by the proper Committee which
may either reject the complaint or uphold it; (3) whether the resolution of the Committee rejects
or upholds the complaint, the resolution must be forwarded to the House for further processing;
and (4) there is the processing of the same complaint by the House of Representatives which
either affirms a favorable resolution of the Committee or overrides a contrary resolution by a
vote of one-third of all the members. If at least one third of all the Members upholds the
complaint, Articles of Impeachment are prepared and transmitted to the Senate. It is at this point
that the House "initiates an impeachment case." It is at this point that an impeachable public
official is successfully impeached. That is, he or she is successfully charged with an
impeachment "case" before the Senate as impeachment court.

Father Bernas further explains: The "impeachment proceeding" is not initiated when the
complaint is transmitted to the Senate for trial because that is the end of the House proceeding
and the beginning of another proceeding, namely the trial. Neither is the "impeachment
proceeding" initiated when the House deliberates on the resolution passed on to it by the
Committee, because something prior to that has already been done. The action of the House is
already a further step in the proceeding, not its initiation or beginning. Rather, the proceeding is
initiated or begins, when a verified complaint is filed and referred to the Committee on Justice
for action. This is the initiating step which triggers the series of steps that follow.

The framers of the Constitution also understood initiation in its ordinary meaning. Thus when a
proposal reached the floor proposing that "A vote of at least one-third of all the Members of the
House shall be necessary… to initiate impeachment proceedings," this was met by a proposal to
delete the line on the ground that the vote of the House does not initiate impeachment proceeding
but rather the filing of a complaint does.146 Thus the line was deleted and is not found in the
present Constitution.
Father Bernas concludes that when Section 3 (5) says, "No impeachment proceeding shall be
initiated against the same official more than once within a period of one year," it means that no
second verified complaint may be accepted and referred to the Committee on Justice for action.
By his explanation, this interpretation is founded on the common understanding of the meaning
of "to initiate" which means to begin. He reminds that the Constitution is ratified by the people,
both ordinary and sophisticated, as they understand it; and that ordinary people read ordinary
meaning into ordinary words and not abstruse meaning, they ratify words as they understand it
and not as sophisticated lawyers confuse it.

To the argument that only the House of Representatives as a body can initiate impeachment
proceedings because Section 3 (1) says "The House of Representatives shall have the exclusive
power to initiate all cases of impeachment," This is a misreading of said provision and is
contrary to the principle of reddendo singula singulis by equating "impeachment cases" with
"impeachment proceeding."

From the records of the Constitutional Commission, to the amicus curiae briefs of two former
Constitutional Commissioners, it is without a doubt that the term "to initiate" refers to the filing
of the impeachment complaint coupled with Congress' taking initial action of said complaint.

Having concluded that the initiation takes place by the act of filing and referral or endorsement
of the impeachment complaint to the House Committee on Justice or, by the filing by at least
one-third of the members of the House of Representatives with the Secretary General of the
House, the meaning of Section 3 (5) of Article XI becomes clear. Once an impeachment
complaint has been initiated, another impeachment complaint may not be filed against the same
official within a one year period.

Under Sections 16 and 17 of Rule V of the House Impeachment Rules, impeachment

proceedings are deemed initiated (1) if there is a finding by the House Committee on Justice that
the verified complaint and/or resolution is sufficient in substance, or (2) once the House itself
affirms or overturns the finding of the Committee on Justice that the verified complaint and/or
resolution is not sufficient in substance or (3) by the filing or endorsement before the Secretary-
General of the House of Representatives of a verified complaint or a resolution of impeachment
by at least 1/3 of the members of the House. These rules clearly contravene Section 3 (5) of
Article XI since the rules give the term "initiate" a meaning different meaning from filing and
referral.

In his amicus curiae brief, Justice Hugo Gutierrez posits that this Court could not use
contemporaneous construction as an aid in the interpretation of Sec.3 (5) of Article XI, citing
Vera v. Avelino147 wherein this Court stated that "their personal opinions (referring to Justices
who were delegates to the Constitution Convention) on the matter at issue expressed during this
Court's our deliberations stand on a different footing from the properly recorded utterances of
debates and proceedings." Further citing said case, he states that this Court likened the former
members of the Constitutional Convention to actors who are so absorbed in their emotional roles
that intelligent spectators may know more about the real meaning because of the latter's balanced
perspectives and disinterestedness.148

Justice Gutierrez's statements have no application in the present petitions. There are at present
only two members of this Court who participated in the 1986 Constitutional Commission – Chief
Justice Davide and Justice Adolf Azcuna. Chief Justice Davide has not taken part in these
proceedings for obvious reasons. Moreover, this Court has not simply relied on the personal
opinions now given by members of the Constitutional Commission, but has examined the records
of the deliberations and proceedings thereof.

Respondent House of Representatives counters that under Section 3 (8) of Article XI, it is clear
and unequivocal that it and only it has the power to make and interpret its rules governing
impeachment. Its argument is premised on the assumption that Congress has absolute power to
promulgate its rules. This assumption, however, is misplaced.

Section 3 (8) of Article XI provides that "The Congress shall promulgate its rules on
impeachment to effectively carry out the purpose of this section." Clearly, its power to
promulgate its rules on impeachment is limited by the phrase "to effectively carry out the
purpose of this section." Hence, these rules cannot contravene the very purpose of the
Constitution which said rules were intended to effectively carry out. Moreover, Section 3 of
Article XI clearly provides for other specific limitations on its power to make rules, viz:

Section 3. (1) x x x

(2) A verified complaint for impeachment may be filed by any Member of the House of
Representatives or by any citizen upon a resolution of endorsement by any Member
thereof, which shall be included in the Order of Business within ten session days, and
referred to the proper Committee within three session days thereafter. The Committee,
after hearing, and by a majority vote of all its Members, shall submit its report to the
House within sixty session days from such referral, together with the corresponding
resolution. The resolution shall be calendared for consideration by the House within ten
session days from receipt thereof.

(3) A vote of at least one-third of all the Members of the House shall be necessary to
either affirm a favorable resolution with the Articles of Impeachment of the Committee,
or override its contrary resolution. The vote of each Member shall be recorded.

(4) In case the verified complaint or resolution of impeachment is filed by at least one-
third of all the Members of the House, the same shall constitute the Articles of
Impeachment, and trial by the Senate shall forthwith proceed.

(5) No impeachment proceedings shall be initiated against the same official more than
once within a period of one year.

It is basic that all rules must not contravene the Constitution which is the fundamental law. If as
alleged Congress had absolute rule making power, then it would by necessary implication have
the power to alter or amend the meaning of the Constitution without need of referendum.

In Osmeña v. Pendatun,149 this Court held that it is within the province of either House of
Congress to interpret its rules and that it was the best judge of what constituted "disorderly
behavior" of its members. However, in Paceta v. Secretary of the Commission on
Appointments,150 Justice (later Chief Justice) Enrique Fernando, speaking for this Court and
quoting Justice Brandeis in United States v. Smith,151 declared that where the construction to be
given to a rule affects persons other than members of the Legislature, the question becomes
judicial in nature. In Arroyo v. De Venecia,152 quoting United States v. Ballin, Joseph & Co.,153
Justice Vicente Mendoza, speaking for this Court, held that while the Constitution empowers
each house to determine its rules of proceedings, it may not by its rules ignore constitutional
restraints or violate fundamental rights, and further that there should be a reasonable relation
between the mode or method of proceeding established by the rule and the result which is sought
to be attained. It is only within these limitations that all matters of method are open to the
determination of the Legislature. In the same case of Arroyo v. De Venecia, Justice Reynato S.
Puno, in his Concurring and Dissenting Opinion, was even more emphatic as he stressed that in
the Philippine setting there is even more reason for courts to inquire into the validity of the Rules
of Congress, viz:

With due respect, I do not agree that the issues posed by the petitioner are non-
justiciable. Nor do I agree that we will trivialize the principle of separation of power
if we assume jurisdiction over he case at bar. Even in the United States, the principle
of separation of power is no longer an impregnable impediment against the interposition
of judicial power on cases involving breach of rules of procedure by legislators.

Rightly, the ponencia uses the 1891 case of US v Ballin (144 US 1) as a window to view
the issues before the Court. It is in Ballin where the US Supreme Court first defined the
boundaries of the power of the judiciary to review congressional rules. It held:

"x x x

"The Constitution, in the same section, provides, that each house may determine the rules
of its proceedings." It appears that in pursuance of this authority the House had, prior to
that day, passed this as one of its rules:

Rule XV

3. On the demand of any member, or at the suggestion of the Speaker, the names of
members sufficient to make a quorum in the hall of the House who do not vote shall be
noted by the clerk and recorded in the journal, and reported to the Speaker with the
names of the members voting, and be counted and announced in determining the presence
of a quorum to do business. (House Journal, 230, Feb. 14, 1890)

The action taken was in direct compliance with this rule. The question, therefore, is as
to the validity of this rule, and not what methods the Speaker may of his own motion
resort to for determining the presence of a quorum, nor what matters the Speaker or clerk
may of their own volition place upon the journal. Neither do the advantages or
disadvantages, the wisdom or folly, of such a rule present any matters for judicial
consideration. With the courts the question is only one of power. The Constitution
empowers each house to determine its rules of proceedings. It may not by its rules
ignore constitutional restraints or violate fundamental rights, and there should be a
reasonable relation between the mode or method of proceedings established by the rule
and the result which is sought to be attained. But within these limitations all matters of
method are open to the determination of the House, and it is no impeachment of the rule
to say that some other way would be better, more accurate, or even more just. It is no
objection to the validity of a rule that a different one has been prescribed and in force for
a length of time. The power to make rules is not one which once exercised is exhausted.
It is a continuous power, always subject to be exercised by the House, and within the
limitations suggested, absolute and beyond the challenge of any other body or tribunal."
Ballin, clearly confirmed the jurisdiction of courts to pass upon the validity of
congressional rules, i.e, whether they are constitutional. Rule XV was examined by
the Court and it was found to satisfy the test: (1) that it did not ignore any constitutional
restraint; (2) it did not violate any fundamental right; and (3) its method had a reasonable
relationship with the result sought to be attained. By examining Rule XV, the Court did
not allow its jurisdiction to be defeated by the mere invocation of the principle of
separation of powers.154

xxx

In the Philippine setting, there is a more compelling reason for courts to categorically
reject the political question defense when its interposition will cover up abuse of
power. For section 1, Article VIII of our Constitution was intentionally cobbled to
empower courts "x x x to determine whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any branch or
instrumentality of the government." This power is new and was not granted to our
courts in the 1935 and 1972 Constitutions. It was not also xeroxed from the US
Constitution or any foreign state constitution. The CONCOM granted this
enormous power to our courts in view of our experience under martial law where
abusive exercises of state power were shielded from judicial scrutiny by the misuse
of the political question doctrine. Led by the eminent former Chief Justice Roberto
Concepcion, the CONCOM expanded and sharpened the checking powers of the
judiciary vis-à-vis the Executive and the Legislative departments of government.155

xxx

The Constitution cannot be any clearer. What it granted to this Court is not a mere
power which it can decline to exercise. Precisely to deter this disinclination, the
Constitution imposed it as a duty of this Court to strike down any act of a branch or
instrumentality of government or any of its officials done with grave abuse of
discretion amounting to lack or excess of jurisdiction. Rightly or wrongly, the
Constitution has elongated the checking powers of this Court against the other branches
of government despite their more democratic character, the President and the legislators
being elected by the people.156

xxx

The provision defining judicial power as including the 'duty of the courts of justice. . . to
determine whether or not there has been a grave abuse of discretion amounting to lack or
excess of jurisdiction on the part of any branch or instrumentality of the Government'
constitutes the capstone of the efforts of the Constitutional Commission to upgrade the
powers of this court vis-à-vis the other branches of government. This provision was
dictated by our experience under martial law which taught us that a stronger and more
independent judiciary is needed to abort abuses in government. x x x

xxx

In sum, I submit that in imposing to this Court the duty to annul acts of government
committed with grave abuse of discretion, the new Constitution transformed this Court
from passivity to activism. This transformation, dictated by our distinct experience as
 nation, is not merely evolutionary but revolutionary. Under the 1935 and the 1973
Constitutions, this Court approached constitutional violations by initially determining
what it cannot do; under the 1987 Constitution, there is a shift in stress – this Court is
mandated to approach constitutional violations not by finding out what it should not do
but what it must do. The Court must discharge this solemn duty by not resuscitating a
past that petrifies the present.

I urge my brethren in the Court to give due and serious consideration to this new
constitutional provision as the case at bar once more calls us to define the parameters of
our power to review violations of the rules of the House. We will not be true to our
trust as the last bulwark against government abuses if we refuse to exercise this new
power or if we wield it with timidity. To be sure, it is this exceeding timidity to
unsheathe the judicial sword that has increasingly emboldened other branches of
government to denigrate, if not defy, orders of our courts. In Tolentino, I endorsed the
view of former Senator Salonga that this novel provision stretching the latitude of judicial
power is distinctly Filipino and its interpretation should not be depreciated by undue
reliance on inapplicable foreign jurisprudence. In resolving the case at bar, the lessons of
our own history should provide us the light and not the experience of foreigners.157
(Italics in the original emphasis and underscoring supplied)

Thus, the ruling in Osmena v. Pendatun is not applicable to the instant petitions. Here, the third
parties alleging the violation of private rights and the Constitution are involved.

Neither may respondent House of Representatives' rely on Nixon v. US158 as basis for arguing
that this Court may not decide on the constitutionality of Sections 16 and 17 of the House
Impeachment Rules. As already observed, the U.S. Federal Constitution simply provides that
"the House of Representatives shall have the sole power of impeachment." It adds nothing more.
It gives no clue whatsoever as to how this "sole power" is to be exercised. No limitation
whatsoever is given. Thus, the US Supreme Court concluded that there was a textually
demonstrable constitutional commitment of a constitutional power to the House of
Representatives. This reasoning does not hold with regard to impeachment power of the
Philippine House of Representatives since our Constitution, as earlier enumerated, furnishes
several provisions articulating how that "exclusive power" is to be exercised.

The provisions of Sections 16 and 17 of Rule V of the House Impeachment Rules which state
that impeachment proceedings are deemed initiated (1) if there is a finding by the House
Committee on Justice that the verified complaint and/or resolution is sufficient in substance, or
(2) once the House itself affirms or overturns the finding of the Committee on Justice that the
verified complaint and/or resolution is not sufficient in substance or (3) by the filing or
endorsement before the Secretary-General of the House of Representatives of a verified
complaint or a resolution of impeachment by at least 1/3 of the members of the House thus
clearly contravene Section 3 (5) of Article XI as they give the term "initiate" a meaning different
from "filing."

Validity of the Second Impeachment Complaint

Having concluded that the initiation takes place by the act of filing of the impeachment
complaint and referral to the House Committee on Justice, the initial action taken thereon, the
meaning of Section 3 (5) of Article XI becomes clear. Once an impeachment complaint has been
initiated in the foregoing manner, another may not be filed against the same official within a one
year period following Article XI, Section 3(5) of the Constitution.

In fine, considering that the first impeachment complaint, was filed by former President Estrada
against Chief Justice Hilario G. Davide, Jr., along with seven associate justices of this Court, on
June 2, 2003 and referred to the House Committee on Justice on August 5, 2003, the second
impeachment complaint filed by Representatives Gilberto C. Teodoro, Jr. and Felix William
Fuentebella against the Chief Justice on October 23, 2003 violates the constitutional prohibition
against the initiation of impeachment proceedings against the same impeachable officer within a
one-year period.

Conclusion

If there is anything constant about this country, it is that there is always a phenomenon that takes
the center stage of our individual and collective consciousness as a people with our characteristic
flair for human drama, conflict or tragedy. Of course this is not to demean the seriousness of the
controversy over the Davide impeachment. For many of us, the past two weeks have proven to
be an exasperating, mentally and emotionally exhausting experience. Both sides have fought
bitterly a dialectical struggle to articulate what they respectively believe to be the correct position
or view on the issues involved. Passions had ran high as demonstrators, whether for or against
the impeachment of the Chief Justice, took to the streets armed with their familiar slogans and
chants to air their voice on the matter. Various sectors of society - from the business, retired
military, to the academe and denominations of faith – offered suggestions for a return to a state
of normalcy in the official relations of the governmental branches affected to obviate any
perceived resulting instability upon areas of national life.

Through all these and as early as the time when the Articles of Impeachment had been
constituted, this Court was specifically asked, told, urged and argued to take no action of any
kind and form with respect to the prosecution by the House of Representatives of the
impeachment complaint against the subject respondent public official. When the present petitions
were knocking so to speak at the doorsteps of this Court, the same clamor for non-interference
was made through what are now the arguments of "lack of jurisdiction," "non-justiciability," and
"judicial self-restraint" aimed at halting the Court from any move that may have a bearing on the
impeachment proceedings.

This Court did not heed the call to adopt a hands-off stance as far as the question of the
constitutionality of initiating the impeachment complaint against Chief Justice Davide is
concerned. To reiterate what has been already explained, the Court found the existence in full of
all the requisite conditions for its exercise of its constitutionally vested power and duty of
judicial review over an issue whose resolution precisely called for the construction or
interpretation of a provision of the fundamental law of the land. What lies in here is an issue of a
genuine constitutional material which only this Court can properly and competently address and
adjudicate in accordance with the clear-cut allocation of powers under our system of
government. Face-to-face thus with a matter or problem that squarely falls under the Court's
jurisdiction, no other course of action can be had but for it to pass upon that problem head on.

The claim, therefore, that this Court by judicially entangling itself with the process of
impeachment has effectively set up a regime of judicial supremacy, is patently without basis in
fact and in law.
This Court in the present petitions subjected to judicial scrutiny and resolved on the merits only
the main issue of whether the impeachment proceedings initiated against the Chief Justice
transgressed the constitutionally imposed one-year time bar rule. Beyond this, it did not go about
assuming jurisdiction where it had none, nor indiscriminately turn justiciable issues out of
decidedly political questions. Because it is not at all the business of this Court to assert judicial
dominance over the other two great branches of the government. Rather, the raison d'etre of the
judiciary is to complement the discharge by the executive and legislative of their own powers to
bring about ultimately the beneficent effects of having founded and ordered our society upon the
rule of law.

It is suggested that by our taking cognizance of the issue of constitutionality of the impeachment
proceedings against the Chief Justice, the members of this Court have actually closed ranks to
protect a brethren. That the members' interests in ruling on said issue is as much at stake as is
that of the Chief Justice. Nothing could be farther from the truth.

The institution that is the Supreme Court together with all other courts has long held and been
entrusted with the judicial power to resolve conflicting legal rights regardless of the personalities
involved in the suits or actions. This Court has dispensed justice over the course of time,
unaffected by whomsoever stood to benefit or suffer therefrom, unfraid by whatever imputations
or speculations could be made to it, so long as it rendered judgment according to the law and the
facts. Why can it not now be trusted to wield judicial power in these petitions just because it is
the highest ranking magistrate who is involved when it is an incontrovertible fact that the
fundamental issue is not him but the validity of a government branch's official act as tested by
the limits set by the Constitution? Of course, there are rules on the inhibition of any member of
the judiciary from taking part in a case in specified instances. But to disqualify this entire
institution now from the suit at bar is to regard the Supreme Court as likely incapable of
impartiality when one of its members is a party to a case, which is simply a non sequitur.

No one is above the law or the Constitution. This is a basic precept in any legal system which
recognizes equality of all men before the law as essential to the law's moral authority and that of
its agents to secure respect for and obedience to its commands. Perhaps, there is no other
government branch or instrumentality that is most zealous in protecting that principle of legal
equality other than the Supreme Court which has discerned its real meaning and ramifications
through its application to numerous cases especially of the high-profile kind in the annals of
jurisprudence. The Chief Justice is not above the law and neither is any other member of this
Court. But just because he is the Chief Justice does not imply that he gets to have less in law than
anybody else. The law is solicitous of every individual's rights irrespective of his station in life.

The Filipino nation and its democratic institutions have no doubt been put to test once again by
this impeachment case against Chief Justice Hilario Davide. Accordingly, this Court has resorted
to no other than the Constitution in search for a solution to what many feared would ripen to a
crisis in government. But though it is indeed immensely a blessing for this Court to have found
answers in our bedrock of legal principles, it is equally important that it went through this
crucible of a democratic process, if only to discover that it can resolve differences without the
use of force and aggression upon each other.

WHEREFORE, Sections 16 and 17 of Rule V of the Rules of Procedure in Impeachment

Proceedings which were approved by the House of Representatives on November 28, 2001 are
unconstitutional. Consequently, the second impeachment complaint against Chief Justice Hilario
G. Davide, Jr. which was filed by Representatives Gilberto C. Teodoro, Jr. and Felix William B.
Fuentebella with the Office of the Secretary General of the House of Representatives on October
23, 2003 is barred under paragraph 5, section 3 of Article XI of the Constitution.

SO ORDERED.