STATUTORY CASES

Case Title: G.R. No. L-19650 (September 29, 1966)

Caltex (Philippines), Inc. vs. Enrico Palomar in his capacity as The Postmaster General

1) Facts

The case before us now is a petition for declaratory relief against Postmaster General Enrico
Palomar, parying “that judgment be rendered declaring its ‘Caltex Hooded Pump Contest’ not
to be violative of the Postal Law, and ordering respondent to allow petitioner the use of the mails
to bring the contest to the attention of the public”.

In 1960, Caltex launched a promotional scheme called “Caltex Hooded Pump Contest�
which calls for participants to “estimate the actual number of liters a hooded gas pump at each
Caltex station will dispense during a specified period.� The contest is open to all “motor
vehicle owners and/or licensed drivres�. There is neither a fee or consideration required nor a
purchase required to be made. The forms are available upon request at each Caltex station and
there is also a sealed can where accomplished entry stubs may be deposited.

Caltex wishes to use mails amongst the media for publicizing about the contest, thus, Caltex sent
representatives to the postal authorities for advance clearing for the use of mails for the contest.
However, the postal authorities denied their request in view of sections 1954 (a), 1982, and 1983
of the Revised Administrative Code (Anti-lottery provisions of the Postal Law), which prohibits
the use of mail in conveying any information concerning non-mailable schemes, such as lottery,
gift enterprise, or similar scheme.

Caltex sought for a reconsideration and stressed that there was no consideration involved in the
part of the contestant(s) but the Postmaster General maintained their view and even threatened
Caltex that if the contest was conducted, “a fraud order will have to be issued against it
(Caltex) and all its representativesâ€?. This leads to Caltex’s filing of this petition for declaratory
relief.

The court ruled that the “petitioner does not violate the Postal Law and the respondent has no
right to bar the public distribution or said rules by the mails�. The respondent then appealed.

2) Issue(s)

a) Whether or not the petition states a sufficient cause of action for declaratory relief?

b) Whether or not the proposed “Caltex Hooded Pump Contest� violates the Postal Law?

3) Ruling
Recapitulating, we hold that the petition herein states a sufficient cause of action for declaratory
relief, and that the “Caltex Hooded Pump Contest” as described in the rules submitted by the
appellee does not transgress the provisions of the Postal Law.

ACCORDINGLY, the judgment appealed from is affirmed. No costs.

4) Ratio

Declaratory Relief is the interpretation of several constitutional provisions. Based on Section 1

Rule 63 of the Rules of Court, an action for declaratory relief should be filed by a person
interested under a deed, a will, a contract or other written instrument, and whose rights are
affected by a statute, an executive order, a regulation or an ordinance.

Requisites for Declaratory Relief:

- There is justiciable controversy
- The controversy is between persons whose interests are adverse
- The party seeking the relief has a legal interest in the controversy
- The issue is ripe for judicial determination

* The “Caltex Hooded Pump Contest� is a mere “gratuitous distribution of property by

chance�. It does not qualify as a lottery due to the lack of consideration. An act to be deemed
as a lottery must constitute a (1) prize, (2) chance, and (3) consideration. The participants are not
required to do anything or purchase anything from Caltex in order to participate in the contest.
The true test for having consideration is “whether the participant pays a valuable
consideration for the chance, and not whether those conducting the enterprise receive something
of value in return for the distribution of the prize.�
National Federation of Labor (NFL) v. Eisma
GR L-61236, 31 January 1984 (127 SCRA 419)
En Banc, Fernando (p): 9 concur, 1 concur with comments, 1 took no part, 1 on leave

Facts: On 5 March 1982, the National Federation of Labor filed with the Ministry of Labor and
Employment (Labor Relations Division, Zamboanga City), a petition for direct certification as
the sole exclusive collective bargaining representative of the monthly paid employees at the
Lumbayao manufacturing plant of the Zamboanga Wood Products, Inc. (Zambowood). On 17
April 1982, such employees charged the firm before the same office for underpayment of
monthly living allowances. On 3 May 1982, the union issued a notice of strike against the firm,
alleging illegal termination of Dionisio Estioca, president of the said local union; unfair labor
practice; nonpayment of living allowances; and “employment of oppressive alien management
personnel without proper permit. The strike began on 23 May 1982.

On 9 July 1982, Zambowood filed a complaint with the trial court against the officers and
members of the union, for “damages for obstruction of private property with prayer for
preliminary injunction and/or restraining order.” The union filed a motion for the dismissal and
for the dissolution of the restraining order, and opposition to the issuance of the writ of
preliminary injunction, contending that the incidents of picketing are within the exclusive
jurisdiction of the Labor Arbiter pursuant to Batas Pambansa 227 (Labor Code, Article 217) and
not to the Court of First Instance. The motion was denied. Hence, the petition for certiorari.

Issue: Whether construction of the law is required to determine jurisdiction.

Held: The first and fundamental duty of courts is to apply the law. Construction and
interpretation come only after it has been demonstrated that application is impossible or
inadequate without them.

Jurisdiction over the subject matter in a judicial proceeding is conferred by the sovereign
authority which organizes the court; and it is given only by law. Jurisdiction is never presumed;
it must be conferred by law in words that do not admit of doubt. Since the jurisdiction of courts
and judicial tribunals is derived exclusively from the statutes of the forum, the issue should be
resolved on the basis of the law or statute in force. Therefore, since (1) the original wording of
Article 217 vested the labor arbiters with jurisdiction; since (2) Presidential Decree 1691
reverted the jurisdiction with respect to money claims of workers or claims for damages arising
from employer-employee relations to the labor arbiters after Presidential Decree 1367 transferred
such jurisdiction to the ordinary courts, and since (3) Batas Pambansa 130 made no change with
respect to the original and exclusive jurisdiction of Labor Arbiters with respect to money claims
of workers or claims for damages arising from employer-employee relations; Article 217 is to be
applied the way it is worded. The exclusive original jurisdiction of a labor arbiter is therein
provided for explicitly. It means, it can only mean, that a court of first instance judge then, a
regional trial court judge now, certainly acts beyond the scope of the authority conferred on him
by law when he entertained the suit for damages, arising from picketing that accompanied a
strike.

The Supreme Court, thus, granted the writ of certiorari, and nullified and set aside the 20 July
1982 order issued by the court a quo. It granted the writ of prohibition, and enjoined the Judge of
said court, or whoever acts in his behalf in the RTC to which this case is assigned, from taking
any further action on the civil case (Civil Case 716 [2751]), except for the purpose of dismissing
it. It also made permanent the restraining order issued on 5 August 1982.
Paat v. CA
GR 111107, 10 January 1997 (266 SCRA 167)
Second Division, Torres Jr. (p): 4 concurring

Facts: On 19 May 1989, Victoria de Guzman’s truck was seized by Department of Environment
and Natural Resources personnel in Aritao, Nueva Vizcaya while on its ways to Bulacan from
San Jose, Baggao, Cagayan because the driver could not produce the required documents for the
forest products found concealed in the truck. On 23 May 1989, Aritao CENRO’s Jovito Layugan
issued an order of confiscation of the truck. Its owner, De Guzman, failed to submit the required
explanation within the reglementary period set by Layugan. On 22 June 1989, DENR Regional
Executive Director Rogelio Baggayan sustained the Alitao CENRO’s action of confiscation and
ordered the forfeiture of the truck invoking Section 68-A of Presidential Decree 705, as amended
by Executive Order 277. De Guzman filed for reconsideration but was denied.

The case was appealed to the Secretary of DENR. Pending resolution, however, a suit for
replevin (Civil Case 4031), was filed by De Guzman and company against Layugan and
Baggayan with the RTC Cagayan (Branch 2), contending that the only the court is authorized to
confiscate and forfeit conveyances used in the transporting illegal forest products, pursuant to the
second paragraph of Section 68. De Guzman further contended that the seizure is illegal, as she
did not use the truck in the commission of the crime (of qualified theft under Article 309 and 310
of the Revised Penal Code, punishable under Section 68), as allegedly admitted by the Regional
Executive Director, releasing her from criminal liability. The trial court thereafter issued a writ
ordering the return of the truck to De Guzman. The petitioners filed a petition for certiorari with
the Court of Appeals. The appellate court sustained the trial court’s order ruling that the question
involved is purely a legal one. Hence, the petition.

Issues:

• Whether construction admits that the authority to confiscate or to forfeit conveyances

belongs to the courts
• Whether the truck was used in the commission of an offense under Section 68 of
Presidential Decree 705, as amended by Executive Order 277

Held: The construction that conveyances are subject of confiscation by the courts exclusively
(pursuant to Section 28, paragraph 2) unduly restricts the clear intention of the law and inevitably
reduces the other provision of Section 68-A, aside to the fact that conveyances are not mentioned
nor included in the former provision. In the construction of statutes, it must be read in such a way
as to give effect to the purpose projected in the statute. Statutes should be construed in the light
of the object to be achieved and the evil or mischief to be suppressed, and they should be given
such construction as will advance the object, suppress the mischief, and secure the benefits
intended. In the case at bar, the phrase “to dispose of the same” is broad enough to cover the act
of forfeiting conveyances in favor of the government. The only limitation is that it should be
made “in accordance with pertinent laws, regulations or policies on the matter.”

Further, when the statute is clear and explicit, there is hardly room for any extended court
ratiocination or rationalization of the law. The language of the amendatory executive order, when
it eliminated the phrase “shall be guilty of qualified theft as defined and punished under Articles
309 and 310 of the Revised Penal Code “ and inserted the words “ shall be punished with the
penalties imposed under Article 309 and 310 of the Revised Penal Code,” meant that the act of
cutting, gathering, collecting, removing, or possessing forest products without authority
constitutes a distinct offense independent now from the crime of theft under Articles 309 and 310
of the Revised Penal Code, but the penalty to be imposed is that provided for under Article 309
and 310 of the Revised Penal Code.

The Supreme Court granted the petition, reversed and set aside the 16 October decision and 14
July 1992 resolution of the CA, made permanent the restraining order promulgated on 27
September 1993, and directed the DENR secretary to resolve the controversy with utmost
dispatch.
People v. Mapa
GR L-22301, 30 August 1967 (20 SCRA 1164)
En Banc, Fernando (p): 9 concur

Facts: Mario M. Mapa was charged for illegal possession of firearm and ammunition in an
information dated 14 August 1962 in violation of Section 878 of the Revise Administrative Code
in connection with Section 2692 of the Revised Administrative Code, as amended by CA 56 and
as further amended by RA 4. Accused admits to possession of firearm on ground of being a
secret agent of Governor Feliciano Leviste of Batangas. On 27 November 1963, the lower court
rendered a decision convicting the accused of the crime and sentenced him to imprisonment for
one year and one day to two years. As the appeal involves a question of law, it was elevated to
the Supreme Court.

Issue: Whether or not a secret agent duly appointed and qualified as such of the governor is
exempt from the requirement of having a license of firearm

Held: The law is explicit that it is unlawful for any person to possess any firearm, detached parts
of firearms or ammunition therefor, or any instrument or implement used or intended to be used
in the manufacture of firearms, parts of firearms, or ammunition except when such firearms are
in possession of such public officials and public servants for use in the performance of their
official duties; as those firearms and ammunitions which are regularly and lawfully issued to
officers, soldiers, sailors or marines, the Philippines Constabulary, guards in the employment of
the Bureau of Prisons, municipal police, provincial governors, lieutenant governors, provincial
treasurers, municipal treasurers, municipal mayors, and guards of provincial prisoners and jails.
It is the first and fundamental duty of courts to apply the law; Construction and interpretation
come only after it has been demonstrated that application is impossible or inadequate without
them. The law cannot be any clearer, there being no provision made for a secret agent.

Reliance in the decision in People v. Macarandang is misplaced, and the case no longer speaks
with authority to the extent that the present decision conflicts with. It may be note that in People
v. Macarandang, a secret agent was acquitted on appeal on the assumption that the appointment
of the accused as a secret agent to assist in the maintenance of peace and order campaigns and
detection of crimes sufficiently put him within the category of a ‘peace officer’ equivalent even
to a member of the municipal police expressly covered by section 879, Thus, in the present case,
therefore, the conviction must stand.

The Supreme Court affirmed the appealed judgment.

Daoang v. Municipal Judge of San Nicolas
GR L-34568, 28 March 1988 (159 SCRA 369)
Second Division, Padilla (p): 4 concurring

Facts: On 23 March 1971, spouses Antero and Amanda Agonoy filed a petition with the
Municipal Court of San Nicolas, Ilocos Norte seeking the adoption of minors Quirino Bonilla
and Wilson Marcos. However, minors Roderick and Rommel Daoang, assisted by their father
and guardian ad litem, the petitioners herein filed an opposition to the said adoption. They
contended that the spouses Antero and Amanda Agonoy had a legitimate daughter named
Estrella Agonoy, oppositors mother, who died on 1 March 1971, and therefore said spouses were
disqualified to adopt under Article 335 of the Civil Code, which provides that those who have
legitimate, legitimated, acknowledged natural children or children by legal fiction cannot adopt.

Issue: Whether the spouses Antero Agonoy and Amanda Ramos are disqualified to adopt under
paragraph 1 of Article 335 of the Civil Code.

Held: The words used in paragraph (1) of Article 335 of the Civil Code, in enumerating the
persons who cannot adopt, are clear and unambiguous. When the New Civil Code was adopted,
it changed the word “descendant,” found in the Spanish Civil Code to which the New Civil Code
was patterned, to “children.” The children thus mentioned have a clearly defined meaning in law
and do not include grandchildren. Well known is the rule of statutory construction to the effect
that a statute clear and unambiguous on its face need not be interpreted. The rule is that only
statutes with an ambiguous or doubtful meaning may be the subjects of statutory construction. In
the present case, Roderick and Rommel Daoang, the grandchildren of Antero Agonoy and
Amanda Ramos-Agonoy, cannot assail the adoption of Quirino Bonilla and Wilson Marcos by
the Agonoys.

The Supreme Court denied the petition, and affirmed the judgment of the Municipal Court of San
Nicolas, Ilocos Norte (Special Proceedings 37), wthout pronouncement as to costs.
Paras v. Comelec (Resolution)
GR 123169, 4 November 1996 (264 SCRA 49)
En Banc, Francisco (p): 14 concurring

Facts: Danilo E. Paras is the incumbent Punong Barangay of Pula, Cabanatuan City who won
during the 1994 barangay election. A petition for his recall as Punong Barangay was filed by the
registered voters of the barangay, which was approved by the Comelec. Petition signing was
scheduled on 14 October 1995, where at least 29.30% of the registered voters signed the petition,
well above the 25% requirement provided by law. The Comelec also set the recall election on 13
November 1995, but which was deferred to 16 December 1995 due to the petitioner’s opposition.
To prevent the holding of the recall election, petitioner filed before the RTC Cabanatuan City a
petition for injunction (Special Proceeding Civil Action 2254-AF), with the trial court issuing a
restraining order. After conducting a summary hearing, the trial court lifted the restraining order,
dismissed the petition and required petitioner and his counsel to explain why they should not be
cited for contempt for misrepresenting that the barangay recall election was without Comelec
approval.

In a resolution dated 5 January 1996, the Comelec, for the third time, re-scheduled the recall
election on 13 January 1996; hence, the instant petition for certiorari with urgent prayer for
injunction. The petitioner contends that no recall can take place within one year preceding a
regular local election, the Sangguniang Kabataan elections slated on the first Monday of May
1996. He cited Associated Labor Union v. Letrondo-Montejo to support the argument, the Court
in which case considered the SK election as a regular local election.

Issue: Whether the Sangguniang Kabataan election is to be construed as a regular local election
in a recall proceeding

Held: It is a rule in statutory construction that every part of the statute must be interpreted with
reference to the context, i.e., that every part of the statute must be considered together with the
other parts, and kept subservient to the general intent of the whole enactment. Further, the spirit,
rather than the letter of a law determines its construction; hence, a statute must be read according
to its spirit and intent. The too literal interpretation of the law leads to absurdity which the Court
cannot countenance. A too-literal reading of the law constrict rather than fulfill its purpose and
defeat the intention of its authors. That intention is usually found not in “the letter that killeth but
in the spirit that vivifieth”. In the present case, Paragraph (b) of Section 74 construed together
with paragraph (a) merely designates the period when such elective local official may be subject
of a recall election. The Sangguniang Kabataan elections cannot be considered a regular election,
as this would render inutile the recall provision of the Local Government Code. It would be more
in keeping with the intent of the recall provision of the Code to construe regular local election as
one referring to an election where the office held by the local elective official sought to be
recalled will be contested and be filled by the electorate.

The Supreme Court, however, has to dismiss the petition for having become moot and academic,
as the next regular elections involving the barangay office concerned were seven months away.
Thus, the Temporary Restraining Order issued on 12 January 1996, enjoining the recall election,
was made permanent.
Floresca v. Philex Mining
GR L-30642., 30 April 1985 (136 SCRA 142)
En Banc, Makasiar (p): 7 concurring, 1 on leave, 2 took no part, others dissenting

Facts: Several miners were killed in a cave-in at one of Philex Mining Corporations’ mine sites.
The heirs of the miners were able to recover under the Workman’s Compensation Act (WCA).
Thereafter, a special committee report indicated that the company failed to provide the miners
with adequate safety protection. The heirs decided to file a complaint for damages before the
Court of First Instance (CFI) of Manila. Philex filed a Motion to Dismiss on the ground that the
action was based on an industrial accident which is covered under the WCA and, therefore, the
CFI has no jurisdiction over the case. Philex argues that the work connected injuries are
compensable exclusively under Sections 5 and 46 of the WCA; and that the WCA covers work-
connected accidents even if the employer was negligent as the WCA under Section 4-A imposes
a 50% additional compensation in the event that the employer is negligent. The heirs, however,
contend that the CFI has jurisdiction, as their complaint is not based on the WCA but on the
Civil Code provisions on damages arising out of negligence. The CFI dismissed the complaint
for lack of jurisdiction. The heirs questioned the dismissal before the Supreme Court.

Amici curiae submitted their respective memoranda, pursuant to the resolution of 26 November
1976, involving the issue whether the action of an injured employee or worker or that of his heirs
in case of his death under the Workmen’s Compensation Act is exclusive, selective or
cumulative; i.e. (1: Exclusive) whether an injured employee or his heirs’ action is exclusively
restricted to seeking the limited compensation provided under the Workmen’s Compensation
Act, (2: Selective) whether an injured employee or his heirs have a right of selection or choice of
action between availing of the worker’s right under the Workmen’s Compensation Act and suing
in the regular courts under the Civil Code for higher damages (actual, moral and/or exemplary)
from the employer by virtue of negligence (or fault) of the employer or of his other employees,
or (3: Cumulative) whether an injured employee or his heirs may avail cumulatively of both
actions, i.e., collect the limited compensation under the Workmen’s Compensation Act and sue
in addition for damages in the regular courts. The opinions of the amici curiae are diverse.

The Court in this same decision agreed with the argument that the action is selective, i.e. that the
injured worker or his heirs have the choice of remedies, but that they cannot pursue both courses
of action simultaneously and balance the relative advantage of recourse under the Workmen’s
Compensation Act as against an ordinary action. It further held that the petitioners who had
received the benefits under the Workmen’s Compensation Act, such may not preclude them from
bringing an action before the regular court, as the choice of the first remedy was based on
ignorance or a mistake of fact, which nullifies the choice as it was not an intelligent choice, but
that upon the success of such bids before the lower court, the payments made under the
Workmen’s Compensation Act should be deducted from the damages that may be decreed in
their favor.

Issue: Whether the Supreme Court, in determining the action to be selective, is guilty of judicial
legislation.
Held: The Court, through its majority, defended itself by holding that the Court does not
legislate but merely applies and gives effect to the constitutional guarantees of social justice then
secured by Section 5 of Article II and Section 6 of Article XIV of the 1935 Constitution, and
later by Sections 6, 7, and 9 of Article II of the Declaration of Principles and State Policies of the
1973 Constitution, as amended, and as implemented by Articles 2176, 2177, 2178, 1173, 2201,
2216, 2231 and 2232 of the New Civil Code of 1950. Further, it reiterated its ruling in People vs.
Licera: that judicial decisions of the Supreme Court assume the same authority as the statute
itself, pursuant to Article 8 of the Civil Code of the Philippines which decrees that judicial
decisions applying or interpreting the laws or the Constitution form part of this jurisdiction’s
legal system. It argues that the application or interpretation placed by the Court upon a law is
part of the law as of the date of the enactment of the said law since the Court’s application or
interpretation merely establishes the contemporaneous legislative intent that the construed law
purports to carry into effect. Yet, the Court argues that the Court can legislate, pursuant to
Article 9 of the New Civil Code, which provides that “No judge or court shall decline to render
judgment by reason of the silence, obscurity or insufficiency of the laws.” Thus, even the
legislator himself recognizes that in certain instances, the court “do and must legislate” to fill in
the gaps in the law; because the mind of the legislator, like all human beings, is finite and
therefore cannot envisage all possible cases to which the law may apply.
Republic v. CA and Molina
GR 108763, 13 February 1997
En Banc, Panganiban (p): 8 concur, 3 concur in result

Facts: Roridel Olaviano was married to Reynaldo Molina on 14 April 1985 in Manila, and gave
birth to a son a year after. Reynaldo showed signs of “immaturity and irresponsibility” on the
early stages of the marriage, observed from his tendency to spend time with his friends and
squandering his money with them, from his dependency from his parents, and his dishonesty on
matters involving his finances. Reynaldo was relieved of his job in 1986, Roridel became the
sole breadwinner thereafter. In March 1987, Roridel resigned from her job in Manila and
proceeded to Baguio City. Reynaldo left her and their child a week later. The couple are
separated-in-fact for more than three years.

On 16 August 1990, Roridel filed a verified petition for declaration of nullity of her marriage to
Reynaldo Molina. Evidence for Roridel consisted of her own testimony, that of two of her
friends, a social worker, and a psychiatrist of the Baguio General Hospital and Medical Center.
Reynaldo did not present any evidence as he appeared only during the pre-trial conference. On
14 May 1991, the trial court rendered judgment declaring the marriage void. The Solicitor
General appealed to the Court of Appeals. The Court of Appeals denied the appeals and
affirmed in toto the RTC’s decision. Hence, the present recourse.

Issue: Whether opposing or conflicting personalities should be construed as psychological

incapacity

Held: The Court of Appeals erred in its opinion the Civil Code Revision Committee intended to
liberalize the application of Philippine civil laws on personal and family rights, and holding
psychological incapacity as a broad range of mental and behavioral conduct on the part of one
spouse indicative of how he or she regards the marital union, his or her personal relationship
with the other spouse, as well as his or her conduct in the long haul for the attainment of the
principal objectives of marriage; where said conduct, observed and considered as a whole, tends
to cause the union to self-destruct because it defeats the very objectives of marriage, warrants the
dissolution of the marriage.

The Court reiterated its ruling in Santos v. Court of Appeals, where psychological incapacity
should refer to no less than a mental (not physical) incapacity, existing at the time the marriage is
celebrated, and that there is hardly any doubt that the intendment of the law has been to confine
the meaning of ‘psychological incapacity’ to the most serious cases of personality disorders
clearly demonstrative of an utter insensitivity or inability to give meaning and significance to the
marriage. Psychological incapacity must be characterized by gravity, juridical antecedence, and
incurability. In the present case, there is no clear showing to us that the psychological defect
spoken of is an incapacity; but appears to be more of a “difficulty,” if not outright “refusal” or
“neglect” in the performance of some marital obligations. Mere showing of “irreconcilable
differences” and “conflicting personalities” in no wise constitutes psychological incapacity.

The Court, in this case, promulgated the guidelines in the interpretation and application of
Article 36 of the Family Code, removing any visages of it being the most liberal divorce
procedure in the world: (1) The burden of proof belongs to the plaintiff; (2) the root cause of
psychological incapacity must be medically or clinically identified, alleged in the complaint,
sufficiently proven by expert, and clearly explained in the decision; (3) The incapacity must be
proven existing at the time of the celebration of marriage; (4) the incapacity must be clinically or
medically permanent or incurable; (5) such illness must be grave enough; (6) the essential
marital obligation must be embraced by Articles 68 to 71 of the Family Code as regards husband
and wife, and Articles 220 to 225 of the same code as regards parents and their children; (7)
interpretation made by the National Appellate Matrimonial Tribunal of the Catholic Church, and
(8) the trial must order the fiscal and the Solicitor-General to appeal as counsels for the State.

The Supreme Court granted the petition, and reversed and set aside the assailed decision;
concluding that the marriage of Roridel Olaviano to Reynaldo Molina subsists and remains valid.
Aisporna v. CA
GR L-39419, 12 April 1982 (113 SCRA 459)
First Division, de Castro (p): 5 concur, 1 took no part

Facts: Since 7 March and on 21 June 1969, a Personal Accident Policy was issued by Perla Compania
de Seguros, through its authorized agent Rodolfo Aisporna, for a period of 12 months with the
beneficiary designated as Ana M. Isidro. The insured died by violence during lifetime of policy.
Mapalad Aisporna participated actively with the aforementioned policy.

For reason unexplained, an information was filed against Mapalad Aisporna, Rodolfo’s wife, with the
City Court of Cabanatuan for violation of Section 189 of the Insurance Act on 21 November 1970, or
acting as an agent in the soliciting insurance without securing the certificate of authority from the
office of the Insurance Commissioner. Mapalad contends that being the wife of true agent, Rodolfo,
she naturally helped him in his work, as clerk, and that policy was merely a renewal and was issued
because Isidro had called by telephone to renew, and at that time, her husband, Rodolfo, was absent
and so she left a note on top of her husband’s desk to renew. On 2 August 1971, the trial court found
Mapalad guilty and sentenced here to pay a fine of P500.00 with subsidiary imprisonment in case of
insolvency and to pay the costs. On appeal and on 14 August 1974, the trial court’s decision was
affirmed by the appellate court (CA-GR 13243-CR). Hence, the present recourse was filed on 22
October 1974. On 20 December 1974, the Office of the Solicitor General, representing the Court of
Appeals, submitted that Aisporna may not be considered as having violated Section 189 of the
Insurance Act.

Issue: Whether Mapalad Aisporna is an insurance agent within the scope or intent of the Insurance
Act

Held: Legislative intent must be ascertained from a consideration of the statute as a whole. The
particular words, clauses and phrases should not be studied as detached and isolated expressions, but
the whole and every part of the statute must be considered in fixing the meaning of any of its parts
and in order to produce harmonious whole. In the present case, the first paragraph of Section 189
prohibits a person from acting as agent, subagent or broker in the solicitation or procurement of
applications for insurance without first procuring a certificate of authority so to act from the Insurance
Commissioner; while the second paragraph defines who is an insurance agent within the intent of the
section; while the third paragraph prescribes the penalty to be imposed for its violation. The appellate
court’s ruling that the petitioner is prosecuted not under the second paragraph of Section 189 but
under its first paragraph is a reversible error, as the definition of insurance agent in paragraph 2
applies to the paragraph 1 and 2 of Section 189, which is “any person who for compensation shall be
an insurance agent within the intent of this section.” Without proof of compensation, directly or
indirectly, received from the insurance policy or contract, Mapalad Aisporna may not be held to have
violated Section 189 of the Insurance Act.

The Supreme Court reversed the appealed judgment and acquitted the accused of the crime charged,
with costs de oficio.
China Bank v. Ortega (J)
GR L-34964, 31 January 1973 (49 SCRA 355)
Second Division, Makalintal (p): 7 concur, 2 took no part

Facts: On 17 December 1968, Vicente Acaban filed a complaint against B & B Forest Development
Corporation and Mariano Bautista for the collection of sum of money. The trial court declared the
defendants in default for failure to answer within the reglementary period, and rendered its decision
on 20 January 1970.

To satisfy the judgment, Acaban sought the garnishment of the bank deposit of B & B Forest
Development Corporation with the China Bank. However, Tan Kim Liong, the bank’s cashier,
disallowed the same invoking the provisions of Republic Act 1405, which prohibit the disclosure of any
information relative to bank deposits. On 4 March 1972, Tan Kim Lion was ordered to inform the
Court if there is a deposit by B & B Forest Development in the China Bank, and if there is, to hold the
same intact and not allow any withdrawal until further order from the Court. Tan Kim Liong moved to
reconsider but was turned down. In the same order he was directed to comply with the order of the
Court, otherwise his arrest and confinement will be ordered. Resisting the 2 orders, the China Bank
and Tan Kim Liong instituted the petition. Petitioners argue that the disclosure of the information
required by the court does not fall within any of the four (4) exceptions enumerated in Section 2 ([1]
upon written permission of the depositor, [2] or in cases of impeachment, [3] or upon order of a
competent court in cases of bribery or dereliction of duty of public officials, [4] or in cases where the
money deposited or invested is the subject matter of the litigation), and that if the questioned orders
are complied with Tan Kim Liong may be criminally liable under Section 5 and the bank exposed to a
possible damage suit by B & B Forest Development Corporation. Specifically referring to the case, the
position of the petitioners is that bank deposit of judgment debtor B and B Forest Development
Corporation cannot be subject to garnishment to satisfy a final judgment against it in view of the
aforementioned provisions of law.

Issue: Whether or not a banking institution may validly refuse to comply with a court process
garnishing the bank deposit of a judgment debtor, by invoking the provisions of Republic Act 1405.

Held: From the discussion of the conference committee report of the two houses of Congress that the
prohibition against examination of or inquiry into a bank deposit under Republic Act 1405 does not
preclude its being garnished to insure satisfaction of a judgment. Indeed, there is no real inquiry in
such a case, and if the existence of the deposit is disclosed, the disclosure is purely incidental to the
execution process. Importantly, it was not the intention of the lawmakers to place bank deposits
beyond the reach of execution to satisfy a judgment. In the present case, the lower court did not
order an examination of or inquiry into the deposit of B & B Forest Development Corporation, as
contemplated in the law. It merely required Tan Kim Liong to inform the court whether B & B Forest
Development Corporation had a deposit in the China Banking Corporation only for purposes of the
garnishment issued by it, so that the bank would hold the same intact and not allow any withdrawal
until further order.

The Supreme Court affirmed the orders of the lower court dated 4 and 27 March 1972, with costs
against the petitioners.
Board of Administrators of the PVA v. Bautista
GR L-37867, 22 February 1982 (112 SRCA 59)
First Division, Guerrero (p): 5 concurring

Facts: Calixto Gasilao was a veteran in good standing during the last World War that took active
participation in the liberation drive against the enemy, and due to his military service, he was
rendered disabled. The Philippine Veterans Administration, formerly the Philippine Veterans Board,
(now Philippine Veterans Affairs Office) is an agency of the Government charged with the
administration of different laws giving various benefits in favor of veterans and their orphans/or
widows and parents. On July 23, 1955, Gasilao filed a claim for disability pension under Section 9 of
Republic Act 65, with the Philippine Veterans Board, alleging that he was suffering from Pulmonary
Tuberculosis (PTB), which he incurred in line of duty. Due to Gasilao’s failure to complete his
supporting papers and submit evidence to establish his service-connected illness, his claim was
disapproved by the Board on 18 December 1955. On 8 August 1968, Gasilao was able to complete his
supporting papers and, after due investigation and processing, the Board of Administrators found out
that his disability was 100% thus he was awarded the full benefits of section 9 of Republic Act 65.

Later on, Republic Act 5753 was approved on 22 June 1969, providing for an increase in the basic
pension and additional pension for the wife and each of the unmarried minor children. Gasilao’s
monthly pension was, however, increased only on 15 January 1971, and by 25% of the increases
provided by law, due to the fact that it was only on said date that funds were released for the
purpose, and the amount so released was only sufficient to pay only 25% of the increase. On 15
January 1972, more funds were released to implement fully Republic Act 5753 and allow payment in
full of the benefits thereunder from said date.

In 1973, Gasilao filed an action against the Board to recover the pension, which he claims he is
entitled to, from July 1955, when he first filed his application for pension, up to 1968 when his pension
was finally approved. The Board contends, however, based on Section 15 of Republic Act 65, that
since the section impliedly requires that the application filed should first be approved by the Board of
Administrators before the claimant could receive his pension, therefore, an award of pension benefits
should commence from the date of approval of the application.

Issue: Whether Gasilao is entitled to the pension from 1955 instead of from 1968.

Held: As it is generally known, the purpose of Congress in granting veteran pensions is to compensate
a class of men who suffered in the service for the hardships they endured and the dangers they
encountered, and more particularly, those who have become incapacitated for work owing to sickness,
disease or injuries sustained while in line of duty. A veteran pension law is, therefore, a governmental
expression of gratitude to and recognition of those who rendered service for the country, especially
during times of war or revolution, by extending to them regular monetary aid. For this reason, it is the
general rule that a liberal construction is given to pension statutes in favor of those entitled to
pension. Courts tend to favor the pensioner, but such constructional preference is to be considered
with other guides to interpretation, and a construction of pension laws must depend on its own
particular language. In the present case, Republic Act 65 is a veteran pension law which must be
accorded a liberal construction and interpretation in order to favor those entitled to rights, privileges,
and benefits granted thereunder, among which are the right to resume old positions in government,
educational benefits, the privilege to take promotion examinations, a life pension for the incapacited,
pension for widow and children, and hospitalization and medical benefits. Upholding the Board that the
pension awards are made effective only upon approval of the application, this would be dependent
upon the discretion of the Board which had been abused in this case through inaction extending for 12
years. Such stand, therefore does not appear to be, or simply is not, in consonance with the spirit and
intent of the law. Gasilao’s claim was sustained.

The Supreme Court modified the judgment of the court a quo, ordering the Board of Administrators of
the Philippine Veterans Administration (now the Philippine Veterans Affairs Office) to make Gasilao’s
pension effective 18 December 1955 at the rate of P50.00 per month plus P10.00 per month for each
of his then unmarried minor children below 18, and the former amount increased to P100.00 from 22
June 1957 to 7 August 1968; and declaring the differentials in pension to which said Gasilao, his wife
and his unmarried minor children below 18 are entitled for the period from 22 June 1969 to 14
January 1972 by virtue of Republic Act 5753 subject to the availability of Government funds
appropriated for the purpose.
Salvatierra v. CA
GR 107797, 26 August 1996 (261 SCRA 45)
First Division, Hermosisima (p): 3 concur, 1 on leave

Facts: In 1930, Enrique Salvatierra died intestate and without any issue. He was survived by his
legitimate brothers: Tomas, Bartolome, Venancio and Macario, and sister Marcela, all surnamed
Salvatierra. His estate consisted of three parcels of land (Cadastral Lot 25, covered by Tax Declaration
11950, Cadastral Lot 26, covered by Tax Declaration 11951, and Cadastral Lot 27, covered by Tax
Declaration 11949). On 4 May 1966, Macario Salvatierra sold Lot 26 to his son, Anselmo Salvatierra
by means of a deed of sale, and in consideration of P1,000.00. Meanwhile, Marcela sold her share to
Venancio. Bartolome’s share was sold by his heirs to Tomas. On 24 September 1968, an “Extrajudicial
Partition with Confirmation of Sale” was executed by and among the surviving legal heirs and
descendants of Enrique Salvatierra. After the partition, Venancio owned 1041 square meters
consisting of Lot 27 and portion of Lot 26 (which is approximately 749 square meters), Anselmo
owned 405 square meters of Lot 26, while the heirs of Tomas owned 1,116 square meters, the whole
of Lot 25. Thereafter on 15 June 1970, Venancio sold the whole of Lot 27 and a 149 square meter
portion of Lot 26 to spouses Lino Longalong and Paciencia Mariano. It was discovered in 1982 through
a relocation survey that the 149 square meter portion of Lot 26 was outside Longalong’s fence as
Anselmo Salvatierra was able to obtain a title in his name (Original Certificate of Title 0-4221)
covering the whole of Lot 26). Efforts to settle the matter at the barangay level proved futile because
Purita Salvatierra (widow of Anselmo) refused to yield to the demand of Lino Longalong to return to
the latter the 149 square meter portion of Lot 26.

Longalong filed a case with the Regional Trial Court for the reconveyance of the said portion of Lot 26.
The court a quo dismissed the case on the grounds that Longalong failed to establish ownership of the
portion of the land in question, and that the prescriptive period of four years from discovery of the
alleged fraud committed by defendants’ predecessor Anselmo Salvatierra within which plaintiffs should
have filed their action had already elapsed. On appeal, the Court of Appeals reversed the decision,
ruling that a vendor can sell only what he owns or what he is authorized to sell; and as to the co-
owner of a piece of land, he can of course sell his pro indiviso share therein to, but he cannot sell
more than his share therein. Hence, the appeal.

Issue: Whether Longalong is entitled to reconveyance of the 149 square meters in Lot 26

Held: When the terms of the agreement are clear and unequivocal, the literal and plain meaning
thereof should be observed, pursuant to Article 1370 of the Civil Code (“If the terms of a contract are
clear and leave no doubt upon the intention of the contracting parties, the literal meaning of its
stipulation shall control.”) Contracts which are the private laws of the contracting parties, should be
fulfilled according to the literal sense of their stipulations, if their terms are clear and leave no room
for doubt as to the intention of the contracting parties, for contracts are obligatory, no matter what
their forms maybe, whenever the essential requisites for their validity are present. In the present
case, there is no ambiguity in the terms and stipulations of the extrajudicial partition (Extrajudicial
Partition with Confirmation of Sale). Since Macario’s share (later Anselmo’s) is only 405 of the 749
square meters comprising Lot 26, Venancio was entitled to the remaining 344 square meters of Lot
26, 149 square meters of which was sold to Longalong. Supplemented by the holding that the
prescriptive period on reconveyance is ten years and not four years, as held in Caro v. CA, Longalong
is entitled to reconveyance as his complaint was filed five years after the constitution of Anselmo’s
fraudulent Original Certificate of title.
The Supreme Court denied the petition for want of merit, with costs against petitioners.
Kapisanan ng mga Manggagawa v. Manila Railroad Company
GR L-25316, 28 February 1979 (88 SCRA 616)
Second Division, Fernando (p): 5 concur, 1 took no part

Facts: There are no antecedent facts available for this case.

The union seeks reversal of decision of the lower court dismissing its petition for mandamus. The court
determined Republic Act 2023 was enacted only to compel the employer to make the deduction of the
employees’ debt from the latter’s salary and turn this over to the employees’ credit union; but which
does not convert the credit union’s credit into a first priority credit.

Issue: Whether, indeed, the law does not give first priority in the matter of payments to the
obligations of employees in favor of their credit unions.

Held: Where the statutory norm speaks unequivocally, there is nothing for the courts to do except to
apply it. The law, leaving no doubt as to the scope of its operation, must be obeyed. The express
provisions of the New Civil Code, Articles 2241, 2242 and 2244 show the legislative intent on
preference of credits. In the present case, the applicable provision of Republic Act 2023 speaks for
itself; there being no ambiguity, it is to be applied. If the legislative intent in enacting paragraphs 1
and 2 of Section 62 of RA 2023 were to give first priority in the matter of payments to the obligations
of employees in favor of their credit unions, then, the law would have so expressly declared. There is
nothing in the provision of Republic Act 2023 which provides that obligation of laborers and employees
payable to credit unions shall enjoy first priority in the deduction from the employees’ wages and
salaries.

The Supreme Court affirmed the appealed decision, without pronouncement as to costs.
Abellana v. Marava [GR L-27760, 29 May 1974]
Second Division, Fernando (p): 4 concur, 1 concur based on paragraph 2 & 3 of opinio

Facts: Francisco Abellana was charged with the City Court of Ozamis City with the crime of physical
injuries through reckless imprudence in driving his cargo truck, hitting a motorized pedicab resulting in
injuries to its passengers, namely, Marcelo Lamason, Maria Gurrea, Pacienciosa Flores, and Estelita
Nemeño. Abellana was found guilty as charged, damages in favor of the offended parties likewise
being awarded.

Abellana appealed such decision to the CFI. At this stage, Lamason et.al. filed with another branch of
the CFI of Misamis Occidental a separate and independent civil action for damages allegedly suffered
by them from the reckless driving of Abellana. In such complaint, Crispin Abellana, the alleged
employer, was included as defendant. Both of them then sought the dismissal of such action
principally on the ground that there was no reservation for the filing thereof in the City Court of
Ozamis. It was argued by them that it was not allowable at the stage where the criminal case was
already on appeal. The judge in the latter CFI ordered on 28 April 1967 that the City Court judgment
is vacated and a trail de novo be conducted. He noted that the offended parties failed to expressly
waive the civil action or reserved their right to institute it separately in the City Court; but which they
filed in the CFI. In view of the waiver and reservation, the Court would be precluded from judging civil
damages against the accused and in favor of the offended parties. the motion to dismiss is denied. A
motion for reconsideration was likewise denied. Hence, the petition.

The Supreme Court dismissed the petition with costs against petitioners.

1. Appeal of judgment in municipal trial court, new trial as if originally instituted in the
CFI
The rule in the jurisdiction of the Court is that upon appeal by the defendant from a judgment of
conviction by the municipal court, the appealed decision is vacated and the appealed case shall be
tried in all respects anew in the CFI as if it had been originally instituted in that court (Section 7 of
Rule 123, People v. Jamisola). So it is in civil cases under Section 9 of Rule 40. An interpretation that
an independent civil action is barred absent a reservation under Section 1 of Rule 111 is a non-
sequitur, as the inference does not per se arise from the wordings of the rule and ignores what is
explicitly provided in Section 7, Rule 123.

2. A statute must not be construed in a manner giving rise to a constitutional doubt

A court is to avoid construing a statute or legal norm in such a manner as would give rise to a
constitutional doubt. The grant of power to the Court, both in the present Constitution and under the
1935 Charter, does not extend to any diminution, increase or modification of substantive right. Thus,
substantive right cannot to be frittered away by a construction that could render it nugatory, if
through oversight, the offended parties failed at the initial stage to seek recovery for damages in a
civil suit. Article 33 of the Civil Code is quite clear when it provides that in cases of . physical injuries,
a civil action for damages, entirely separate and distinct from the criminal action, may be brought by
the injured party. Such civil action shall proceed independently of the criminal prosecution, and shall
require only a preponderance of evidence.

3. Assurance of parties justice according to law must not be ignored in the pursuit of
serving the interest of a client; Construction should be based on legal norm, not literalness
A counsel must not ignore the basic purpose of a litigation, which is to assure parties justice according
to law, in serving the interest of his client. He is not to fall prey to the vice of literalness. The law as
an instrument of social control will fail in its function if through an ingenious construction sought to be
fastened on a legal norm, particularly a procedural rule, there is placed an impediment to a litigant
being given an opportunity of vindicating an alleged right.
PAFLU v. Bureau of Labor Relations
GR L-43760, 21 August 1976 (72 SCRA 396)
Second Division, Fernando (p): 4 concurring

Facts: In the certification election held on February 27, 1976, respondent Union obtained 429 votes
as against 414 of petitioner Union. Again, admittedly, under the Rules and Regulations implementing
the present Labor Code, a majority of the valid votes cast suffices for certification of the victorious
labor union as the sole and exclusive bargaining agent. There were four votes cast by employees who
did not want any union. On its face therefore, respondent Union ought to have been certified in
accordance with the above applicable rule. Petitioner, undeterred, would seize upon the doctrine
announced in the case of Allied Workers Association of the Philippines v. Court of Industrial Relations
that spoiled ballots should be counted in determining the valid votes cast. Considering there were
seventeen spoiled ballots, it is the submission that there was a grave abuse of discretion on the part
of respondent Director.

Issue: Whether Director Noriel acted with grave abuse of discretion in granting NAFLU as the
exclusive bargaining agent of all the employees in the Philippine Blooming Mills

Held: Director Noriel did not act with grave abuse of discretion. Certiorari does not lie. The conclusion
reached by the Court derives support from the deservedly high repute attached to the construction
placed by the executive officials entrusted with the responsibility of applying a statute. The Rules and
Regulations implementing the present Labor Code were issued by Secretary Blas Ople of the
Department of Labor and took effect on 3 February 1975, the present Labor Code having been made
known to the public as far back as 1 May 1974, although its date of effectivity was postponed to 1
November 1974,. It would appear then that there was more than enough time for a really serious and
careful study of such suppletory rules and regulations to avoid any inconsistency with the Code. This
Court certainly cannot ignore the interpretation thereafter embodied in the Rules. As far back as In re
Allen,” a 1903 decision, Justice McDonough, as ponente, cited this excerpt from the leading American
case of Pennoyer v. McConnaughy, decided in 1891: “The principle that the contemporaneous
construction of a statute by the executive officers of the government, whose duty it is to execute it, is
entitled to great respect, and should ordinarily control the construction of the statute by the courts, is
so firmly embedded in our jurisprudence that no authorities need be cited to support it.” There was a
paraphrase by Justice Malcolm of such a pronouncement in Molina v. Rafferty,” a 1918 decision:
“Courts will and should respect the contemporaneous construction placed upon a statute by the
executive officers whose duty it is to enforce it, and unless such interpretation is clearly erroneous will
ordinarily be controlled thereby.” Since then, such a doctrine has been reiterated in numerous
decisions. As was emphasized by Chief Justice Castro, “the construction placed by the office charged
with implementing and enforcing the provisions of a Code should he given controlling weight.”

The Supreme Court dismissed the petition, with costs against petitioner PAFLU.
Philippine Apparel Workers’ Union v. NLRC
GR L-50320, 31 July 1981 (105 SCRA 444)
First Division, Makasiar (p): 3 concurring

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

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

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

Held: The collective bargaining agreement was entered into on 3 September1977, when PD 1123 was
already in force and effect, although the increase on the first year was retroactive to 1 April 1977.
There is nothing in the records that the negotiated wage increases were granted or paid before May
1977, to allow the company to fall within the exceptions provided for in paragraph k of the rules
implementing PD 1123. There was neither a perfected contract nor an actual payment of said
increase. There was no grant of said increases yet, despite the contrary opinion expressed in the letter
of the Undersecretary of Labor. It must be noted that the letter was based on a wrong premise or
representation on the part of the company. The company had declared that the parties have agreed
on 2 April 1977 in recognition of the imperative need for employees to cope up with inflation brought
about by, among others, another increase in oil price, but omitting the fact that negotiations were still
being held on other unresolved economic and non-economic bargaining items (which were only agreed
upon on 3 September 1977).
The Department of Labor had the right to construe the word “grant” as used in its rules implementing
PD 1123, and its explanation regarding the exemptions to PD 1123 should be given weight; but, when
it is based on misrepresentations as to the existence of an agreement between the parties, the same
cannot be applied. There is no distinction between interpretation and explaining the extent and scope
of the law; because where one explains the intent and scope of a statute, he is interpreting it. Thus,
the construction or explanation of Labor Undersecretary is not only wrong as it was purely based on a
misapprehension of facts, but also unlawful because it goes beyond the scope of the law.

The writ of certiorari was granted. The Supreme Court set aside the decision of the commission, and
ordered the company to pay, in addition to the increased allowance provided for in PD 1123, the
negotiated wage increase of P0.80 daily effective 1 April 1977 as well as all other wage increases
embodied in the Collective Bargaining Agreement, to all covered employees; with costs against the
company.
IBAA Employees Union v. Inciong
GR L52415, 23 October 1984 (132 SCRA 663)
Second Division, Makasiar (p): 3 concur, 2 concur in result, 1 took no part

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

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

On 30 August 1976, the Union filed a motion for a writ of execution to enforce the arbiter’s decision of
25 August 1975, which the bank opposed. On 18 October 1976, the Labor Arbiter, instead of issuing a
writ of execution, issued an order enjoining the bank to continue paying its employees their regular
holiday pay. On 17 November 1976, the bank appealed from the order of the Labor Arbiter to the
NLRC. On 20 June 1978, the NLRC promulgated its resolution en banc dismissing the bank’s appeal,
and ordering the issuance of the proper writ of execution. On 21 February 1979, the bank filed with
the Office of the Minister of Labor a motion for reconsideration/appeal with urgent prayer to stay
execution. On 13 August 1979,s the NLRC issued an order directing the Chief of Research and
Information of the Commission to compute the holiday pay of the IBAA employees from April 1976 to
the present in accordance with the Labor Arbiter dated 25 August 1975. On 10 November 1979, the
Office of the Minister of Labor, through Deputy Minister Amado G. Inciong, issued an order setting
aside the resolution en banc of the NLRC dated 20 June 1978, and dismissing the case for lack of
merit. Hence, the petition for certiorari charging Inciong with abuse of discretion amounting to lack or
excess of jurisdiction.

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

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

The Supreme Court granted the petition, set aside the order of the Deputy Minister of Labor, and
reinstated the 25 August 1975 decision of the Labor Arbiter Ricarte T. Soriano.
Chartered Bank Employees Association v. Ople
GR L-44717, 28 August 1985 (138 SCRA 273)
En Banc, Gutierrez, Jr. (p): 10 concur, 1 concur in result, 1 took no part, 1 on leave

Facts: On 20 May 1975, the Chartered Bank Employees Association, in representation of its monthly
paid employees/members, instituted a complaint with the Regional Office IV, Department of Labor,
now Ministry of Labor and Employment (MOLE) against Chartered Bank, for the payment of 10
unworked legal holidays, as well as for premium and overtime differentials for worked legal holidays
from 1 November 1974.

Both the arbitrator and the National Labor Relations Commission (NLRC) ruled in favor of the
petitioners ordering the bank to pay its monthly paid employees the holiday pay and the premium or
overtime pay differentials to all employees who rendered work during said legal holidays.

On appeal, the Minister of Labor set aside the decision of the NLRC and dismissed the petitioner’s
claim for lack of merit basing its decision on Section 2, Rule IV, Book III of the Integrated Rules and
Policy Instruction 9, claiming the rule that “If the monthly paid employee is receiving not less than
P240, the maximum monthly minimum wage, and his monthly pay is uniform from January to
December, he is presumed to be already paid the 10 paid legal holidays. However, if deductions are
made from his monthly salary on account of holidays in months where they occur, then he is still
entitled to the 10 paid legal holidays.”

Issue: Whether the Ministry of Labor is correct in maintaining that monthly paid employees are not
entitled to the holiday pay nor all employees who rendered work during said legal holidays are entitled
to the premium or overtime pay differentials.

Held: When the language of the law is clear and unequivocal the law must be taken to mean exactly
what it says. An administrative interpretation, which diminishes the benefits of labor more than what
the statute delimits or withholds, is obviously ultra vires. In the present case, the provisions of the
Labor Code on the entitlement to the benefits of holiday pay are clear and explicit, it provides for both
the coverage of and exclusion from the benefit. In Policy Instruction 9, the Secretary of Labor went as
far as to categorically state that the benefit is principally intended for daily paid employees, when the
law clearly states that every worker shall be paid their regular holiday pay.

While it is true that the contemporaneous construction placed upon a statute by executive officers
whose duty is to enforce it should be given great weight by the courts, still if such construction is so
erroneous, the same must be declared as null and void. It is the role of the Judiciary to refine and,
when necessary, correct constitutional (and/or statutory) interpretation, in the context of the
interactions of the three branches of the government, almost always in situations where some agency
of the State has engaged in action that stems ultimately from some legitimate area of governmental
power. Section 2, Rule IV, Book III of the Rules to implement the Labor Code and Policy Instruction
was declared null and void in IBAAEU v. Inciong, and thus applies in the case at bar. Since the private
respondent premises its action on the invalidated rule and policy instruction, it is clear that the
employees belonging to the petitioner association are entitled to the payment of 10 legal holidays
under Articles 82 and 94 of the Labor Code, aside from their monthly salary. They are not among
those excluded by law from the benefits of such holiday pay
The Supreme Court reversed and set aside the Labor Minister’s 7 September 1976 order, and
reinstated with modification (deleting the interest payments) the 24 March 1976 decision of the NLRC
affirming the 30 October 1975 resolution of the Labor Arbiter.
Victorias Milling v. Social Security Commission
GR L-16704, 17 March 1962 (4 SCRA 627)
En Banc, Barrera (p): 9 concurring

Facts: On 15 October 1958, the Social Security Commission (SSC) issued its Circular 22 providing
that “effective 1 November 1958, all employers in computing the premiums due the System, will take
into consideration and include in the Employee’s remuneration all bonuses and overtime pay, as well
as the cash value of other media of remuneration. All these will comprise the Employee’s
remuneration or earnings, upon which the 3-1/2% and 2- 1/2% contributions will be based, up to a
maximum of P500 for any one month.” Upon receipt of a copy thereof, Victorias Milling Company,
Inc., wrote the SSC in effect protesting against the circular as contradictory to a previous Circular 7 (7
October 1957) , and further questioned the validity of the circular for lack of authority on the part of
the SSC to promulgate it without the approval of the President and for lack of publication in the
Official Gazette. Overruling these objections, the SSC ruled that Circular 22 is not a rule or regulation
that needed the approval of the President and publication in the Official Gazette to be effective, but a
mere administrative interpretation of the statute, a mere statement of general policy or opinion as to
how the law should be construed. Not satisfied with this ruling, petitioner comes to the Supreme Court
on appeal.

Issue: Whether Circular 22 is a rule or regulation.

Held: There is a distinction between an administrative rule or regulation and an administrative

interpretation of a law whose enforcement is entrusted to an administrative body. When an
administrative agency promulgates rules and regulations, it “makes” a new law with the force and
effect of a valid law, while when it renders an opinion or gives a statement of policy, it merely
interprets a pre-existing law Rules and regulations when promulgated in pursuance of the procedure
or authority conferred upon the administrative agency by law, partake of the nature of a statute, and
compliance therewith may be enforced by a penal sanction provided in the law. This is so because
statutes are usually couched in general terms, after expressing the policy, purposes, objectives,
remedies and sanctions intended by the legislature. The details and the manner of carrying out the
law are often times left to the administrative agency entrusted with its enforcement. In this sense, it
has been said that rules and regulations are the product of a delegated power to create new or
additional legal provisions that have the effect of law. A rule is binding on the courts so long as the
procedure fixed for its promulgation is followed and its scope is within the statutory authority granted
by the legislature, even if the courts are not in agreement with the policy stated therein or its innate
wisdom On the other hand, administrative interpretation of the law is at best merely advisory, for it is
the courts that finally determine what the law means.

While it is true that terms or words are to be interpreted in accordance with their well-accepted
meaning in law, nevertheless, when such term or word is specifically defined in a particular law, such
interpretation must be adopted in enforcing that particular law, for it can not be gainsaid that a
particular phrase or term may have one meaning for one purpose and another meaning for some
other purpose. RA 1161 specifically defined what “compensation” should mean “For the purposes of
this Act”. RA1792 amended such definition by deleting some exceptions authorized in the original Act.
By virtue of this express substantial change in the phraseology of the law, whatever prior executive or
judicial construction may have been given to the phrase in question should give way to the clear
mandate of the new law.
The Supreme Court affirmed the appealed resolution, with costs against appellant.
Sarmiento v. Mison [GR L-79974, 17 December 1987]
En Banc, Padilla (p): 8 concur

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

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

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

3. President’s power to appoint

Section 16, Article VII of the 1987 Constitution empowers the President to appoint 4 groups of
officers: (1) the heads of the executive departments, ambassadors, other public ministers and
consuls, officers of the armed forces from the rank of colonel or naval captain, and other officers
whose appointments are vested in him in this Constitution; (2) all other officers of the Government
whose appointments are not otherwise provided for by law; (3) those whom the President may be
authorized by law to appoint; and (4) officers lower in rank 4 whose appointments the Congress may
by law vest in the President alone. The first group is clearly appointed with the consent of the
Commission on Appointments. Appointments of such officers are initiated by nomination and, if the
nomination is confirmed by the Commission on Appointments, the President appoints. The second and
third groups of officers can be made by the President without the consent (confirmation) of the
Commission on Appointments, as can be determined through the recorded proceedings of
Constitutional Commission.
4. Express enumeration excludes others not enumerated
It is an accepted rule in constitutional and statutory construction that an express enumeration of
subjects excludes others not enumerated. In the case at bar, it would follow that only those
appointments to positions expressly stated in the first group require the consent (confirmation) of the
Commission on Appointments.

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

6. Construction of “also” in second sentence; consideration of different language of

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

7. Power to appoint fundamentally executive in character; Limitations construed strictly

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

9. President authorized Commissioner of Bureau of Customs; Commissioner not included

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

10. Laws approved during the effectivity of previous constitution must be read in harmony
with the new one
RA 1937 and PD 34 were approved during the effectivity of the 1935 Constitution, under which the
President may nominate and, with the consent of the Commission on Appointments, appoint the heads
of bureaus, like the Commissioner of the Bureau of Customs. After the effectivity of the 1987
Constitution, however, RA 1937 and PD 34 have to be read in harmony with Sec. 16, Art. VII, with the
result that, while the appointment of the Commissioner of the Bureau of Customs is one that devolves
on the President, as an appointment he is authorized by law to make, such appointment, however, no
longer needs the confirmation of the Commission on Appointments.
Perfecto v. Meer
GR L-2348, 27 February 1950 (85 Phil 552)
First Division, Bengzon (p): 8 concur.

Facts: The 1935 Constitution provides in its Article VIII, Section 9, that the members of the Supreme
Court and all judges of inferior courts “shall receive such compensation as may be fixed by law, which
shall not be diminished during their continuance in office”. It also provides that “until Congress shall
provide otherwise, the Chief Justice of the Supreme Court shall receive an annual compensation of
sixteen thousand pesos, and each Associate Justice, fifteen thousand pesos”. When Justice Perfecto
assumed office, Congress had not “provided otherwise”, by fixing a different salary for associate
justices. He received salary at the rate provided by the Constitution, i.e., fifteen thousand pesos a
year.

The Collector of Internal Revenue required Justice Gregorio Perfecto to pay income tax upon his salary
as member of the judiciary. The latter paid the amount under protest. He contended that the
assessment was illegal, his salary not being taxable for the reason that imposition of taxes thereon
would reduce it in violation of the Constitution.

Issue: Whether the imposition of an income tax upon the salary of a member of the Judiciary amount
to a diminution thereof., and thus violate the Constitution.

Held: The imposition of an income tax upon the salary of a member of the judiciary amounts to a
diminution thereof. If said imposition would not be considered as a diminution, it would appear that,
in the matter of compensation and power and need of security, the judiciary is on a par with the
Executive. Such assumption certainly ignores the prevailing state of affairs. Further, the Constitution
provides that judges shall hold their offices during good behavior, and shall at stated times receive for
their services a compensation which shall not be diminished during their continuance in office. Thus,
next to permanency in office, nothing can contribute more to the independence of the judges than a
fixed provision for their support. In the general course of human nature, a power over a man’s
subsistence amounts to a power over his will. The independence of the judges as of far greater
importance than any revenue that could come from taxing their salaries.

Exemption of the judicial salary from reduction by taxation is not really a gratuity or privilege. It is
essentially and primarily compensation based upon valuable consideration. The covenant on the part
of the government is a guaranty whose fulfillment is as much as part of the consideration agreed as is
the money salary. The undertaking has its own particular value to the citizens in securing the
independence of the judiciary in crises; and in the establishment of the compensation upon a
permanent foundation whereby judicial preferment may be prudently accepted by those who are
qualified by talent, knowledge, integrity and capacity, but are not possessed of such a private fortune
as to make an assured salary an object of personal concern. On the other hand, the members of the
judiciary relinquish their position at the bar, with all its professional emoluments, sever their
connection with their clients, and dedicate themselves exclusively to the discharge of the onerous
duties of their high office. So, it is irrefutable that the guaranty against a reduction of salary by the
imposition of a tax is not an exemption from taxation in the sense of freedom from a burden or service
to which others are liable. The exemption for a public purpose or a valid consideration is merely a
nominal exemption, since the valid and full consideration or the public purpose promoted is received in
the place of the tax.

The Supreme Court affirmed the judgment.

Endencia v. David
GR L-6355-56, 31 August 1953 (93 Phil 696)
En Banc, Montemayor (p): 6 concur

Facts: Saturnino David, as a Collector of Internal Revenue collected income taxes from Justices
Endencia and Jugo, as Presiding Justice of the Court of Appeals and Associate Justice of the Supreme
Court respectively. The lower court held that under the doctrine laid down in the case of Perfecto vs.
Meer, 85 Phil., 552, the collection of income taxes from the salaries of Justice Jugo and Justice
Endencia was a diminution of their compensation and therefore was in violation of the Constitution of
the Philippines, and so ordered the refund of said taxes. Respondent, through the Solicitor General
contended that the collection was done pursuant to Section 13 of Republic Act 590 which Congress
enacted to authorize and legalize the collection of income tax on the salaries of judicial officers, if not
to counteract the ruling on the Perfecto Case.

Issue: Whether the Legislature may lawfully declare the collection of income tax on the salary of a
public official, specially a judicial officer, not a decrease of his salary, after the Supreme Court has
found and decided otherwise.

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

Further, under the Philippine system of constitutional government, the Legislative department is
assigned the power to make and enact laws. The Executive department is charged with the execution
or carrying out of the provisions of said laws. But the interpretation and application of said laws belong
exclusively to the Judicial department. And this authority to interpret and apply the laws extends to
the Constitution. Before the courts can determine whether a law is constitutional or not, it will have to
interpret and ascertain the meaning not only of said law, but also of the pertinent portion of the
Constitution in order to decide whether there is a conflict between the two, because if there is, then
the law will have to give way and has to be declared invalid and unconstitutional. Therefore, the
doctrine laid down in the case of Perfecto vs. Meer to the effect that the collection of income tax on
the salary of a judicial officer is a diminution thereof and so violates the Constitution, is reiterated.
The Supreme Court affirmed the decision, affirming the ruling in Perferto v. Meer and holding the
interpretation and application of laws belong to the Judiciary.
Nitafan v. Commissioner of Internal Revenue (Resolution)
GR L-78780, 23 July 1987
En Banc, Melencio-Herrera (p): 12 concur, 1 on leave

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

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

Issue: Whether the intention of the framers of the 1987 Constitution is to exempt justices and judges
from taxes as it was in the 1935 Constitution.

Held: The ascertainment of the intent is but in keeping with the fundamental principle of
constitutional construction that the intent of the framers of the organic law and of the people adopting
it should be given effect. The primary task in constitutional construction is to ascertain and thereafter
assure the realization of the purpose of the framers and of the people in the adoption of the
Constitution. It may also be safely assumed that the people in ratifying the Constitution were guided
mainly by the explanation offered by the framers. In the present case, Section 10, Article VIII is plain
that the Constitution authorizes Congress to pass a law fixing another rate of compensation of Justices
and Judges but such rate must be higher than that which they are receiving at the time of enactment,
or if lower, it would be applicable only to those appointed after its approval. It would be a strained
construction to read into the provision an exemption from taxation in the light of the discussion in the
Constitutional Commission. Thus, the debates, interpolations and opinions expressed regarding the
constitutional provision in question until it was finally approved by the Commission disclosed that the
true intent of the framers of the 1987 Constitution, in adopting it, was to make the salaries of
members of the Judiciary taxable.

The Supreme Court dismissed the petition for prohibition.

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

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

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

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

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

The Supreme Court denied the petition for a writ of prohibition, without pronouncement as to costs.
Manila Prince Hotel v. GSIS
GR 122156, 3 February 1997
En banc, Bellosillo (p): 6 concur, others dissent

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

Issue(s):

• Whether the provisions of the Constitution, particularly

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

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

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

The Supreme Court directed the GSIS, the Manila Hotel Corporation, the Committee on Privatization
and the Office of the Government Corporate Counsel to cease and desist from selling 51% of the
Share of the MHC to Renong Berhad, and to accept the matching bid of Manila Prince Hotel at P44 per
shere and thereafter execute the necessary agreements and document to effect the sale, to issue the
necessary clearances and to do such other acts and deeds as may be necessary for the purpose.
Tanada v. Tuvera
GR L-63915, 24 April 1985 (136 SCRA 27)
En Banc, Escolin (p): 1 concur, 2 concur with reservation, 1 took no part, 1 on leave

Facts: Invoking the people’s right to be informed on matters of public concern (Section 6, Article IV of
the 1973 Philippine Constitution) as well as the principle that laws to be valid and enforceable must be
published in the Official Gazette or otherwise effectively promulgated, petitioners seek a writ of
mandamus to compel respondent public officials to publish, and or cause the publication in the Official
Gazette of various presidential decrees, letters of instructions, general orders, proclamations,
executive orders, letter of implementation and administrative orders. They 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 are proper parties for the petition. The respondents alleged, however through the Solicitor-
General, that petitioners have no legal personality or standing to bring the instant petition. They
further contend that publication in the Official Gazette is not a sine qua non requirement for the
effectiveness of laws where the laws provide for their own effectivity dates. Thus publication is not
indispensable.

Issue: Whether publication is an indispensable requirement for the effectivity of laws

Held: 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. This is correct insofar as it equates the effectivity of
laws with the fact of publication. Article 2 however, considered in the light of other statutes applicable
to the issue does not preclude the requirement of publication in the Official Gazette, even if the law
itself provides for the date of its effectivity. The clear object of the such provision is to give the
general public adequate notice of the various laws which are to regulate their actions and conduct as
citizens. Without such notice and publication, there would be no basis for the application of the maxim
“ignorantia legis non excusat.” It would be the height of injustice to punish or otherwise burden a
citizen for the transgression of a law of which he had no notice whatsoever, not even a constructive
one. Further, publication is necessary to apprise the public of the contents of regulations and make
the said penalties binding on the persons affected thereby. In the present case, Presidential issuances
of general application, which have not been published, shall have no force and effect. The
implementation/enforcement of presidential decrees prior to their publication in the Official Gazette is
an operative fact, which may have consequences which cannot be justly ignored. The past cannot
always be erased by a new judicial declaration that an all-inclusive statement of a principle of absolute
retroactive invalidity cannot be justified.

The Supreme Court ordered the respondents to publish in the Official Gazette all unpublished
presidential issuances which are of general application, and that unless so published, they shall have
no binding force and effect.
Tanada v. Tuvera (Resolution)
GR L-63915, 29 December 1986 (146 SCRA 446)
En Banc, Cruz (p) : 8 concurring

Facts: On 24 April 1985, the Court affirmed the necessity for the publication to the Official Gazette all
unpublished presidential issuances which are of general application, and unless so published, they
shall have no binding force and effect. Decision was concurred only by 3 judges. Petitioners move for
reconsideration / clarification of the decision on various questions. Solicitor General avers that the
motion is a request for advisory opinion. February Revolution took place, which subsequently required
the new Solicitor General to file a rejoinder on the issue (under Rule 3, Section 18 of the Rules of
Court).

Issue: Whether publication is still required in light of the clause “unless otherwise provided”.

Held: The clause “unless it is otherwise provided,” in Article 2 of the Civil Code, refers to the date of
effectivity and not to the requirement of publication itself, which cannot in any event be omitted. This
clause does not mean that the legislature may make the law effective immediately upon approval, or
on any other date, without its previous publication. The legislature may in its discretion provide that
the usual fifteen-day period shall be shortened or extended. Publication requirements applies to (1) all
statutes, including those of local application and private laws; (2) presidential decrees and executive
orders promulgated by the President in the exercise of legislative powers whenever the same are
validly delegated by the legislature or directly conferred by the Constitution; (3) Administrative rules
and regulations for the purpose of enforcing or implementing existing law pursuant also to a valid
delegation; (4) Charter of a city notwithstanding that it applies to only a portion of the national
territory and directly affects only the inhabitants of that place; (5) Monetary Board circulars to “fill in
the details” of the Central Bank Act which that body is supposed to enforce. Further, publication must
be in full or it is no publication at all since its purpose is to inform the public of the contents of the
laws.

The Supreme Court declared that all laws as above defined shall immediately upon their approval, or
as soon thereafter as possible, be published in full in the Official Gazette, to become effective only
after 15 days from their publication, or on another date specified by the legislature, in accordance with
Article 2 of the Civil Code.
Primicias v. Urdaneta
GR L-26702, 18 October 1979 (93 SCRA 462)
First Division, de Castro (p): 8 concurring, 1 on leave, 1 did not take part.

Facts: On 13 March 1964, Ordinance 3 (Series of 1964) was enacted by the Municipal Council of
Urdaneta, Pangasinan. Ordinance is patterned after and based on Section 53, 5 paragraph 4 of Act
3992, as amended (Revised Motor Vehicle Law). On 20 June 1964, RA 4136 (Land Transportation and
Traffic Code) became effective. Section 63 explicitly repealed Act 3992.

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

Due to the institution of the criminal case, Primicias initiated an action for the annulment of said
ordinance with prayer for the issuance of preliminary injunction for the purpose of restraining
defendants Municipality of Urdaneta, Mayor Perez, Police Chief Suyat, Judge Soriano and Patrolman
Andrada from enforcing the ordinance. The writ was issued and Judge Soriano was enjoined from
further proceeding in the criminal case. On 29 June 1966, the Court of First Instance Lingayen held in
its decision that the ordinance was null and void and had been repealed by RA 4136. The writ of
preliminary injunction against Judge Soriano definite and permanent. It also restrained Perez, Suyat,
and Andrada from enforcing said ordinace throughout Urdaneta, ordering them to return the plaintiff’s
driver’s license, and to pay the cost of the suit. The public officials appealed to the Supreme Court.

Issue: Whether the ordinance is valid.

Held: The general rule is that a later law prevails over an earlier law. The ordinance’s validity should
be determined vis-a-vis RA 4136, the “mother statute” (not Act 3992), which was in force at the time
the criminal case was brought against Primicias. Further, when the Municipal Council of Urdaneta used
the phrase “vehicular traffic” (Section 1, Ordinance) it did not distinguish between passenger cars and
motor vehicles and motor trucks and buses. Considering that this is a regulatory ordinance, its
clearness, definiteness and certainty are all the more important so that an average man should be
able with due care, after reading it, to understand and ascertain whether he will incur a penalty for
particular acts or courses of conduct. Thus, as the Municipal Council of Urdaneta did not make any
classification of its thoroughfares, contrary to the explicit requirement laid down by Section 38, RA
4136. The Ordinance refers to only one of the four classifications mentioned in paragraph (b), Section
35. The classifications which must be based on Section 35 are necessary in view of Section 36 which
states that no provincial, city or municipal authority shall enact or enforce any ordinance or resolution
specifying maximum allowable speeds other than those provided in this Act. The ordinance, therefore
in view of the foregoing, is void.

The Supreme Court affirmed the appealed decision.

La Carlota Sugar Central v. Jimenez
GR L-12436, 31 May 1961 (2 SCRA 295)
En Banc, Dizon (p): 10 concurring, 1 took no part.

Facts: Sometime in September, 1955 La Carlota Sugar Central, which was under the administration of
Elizalde, imported 500 short tons of ammonium sulphate and 350 short tons of ammonium phosphate.
When the fertilizers arrived in the Philippines, the Central Bank imposed 17% exchange tax from the
Central in accordance with the provisions of Republic Act 601. On 18 November 1955 the Central filed,
through the Hongkong & Shanghai Banking Corporation, a petition for the refund of the P20,872.09
paid (the 17% tax), claiming that it had imported the fertilizers mentioned heretofore upon request
and for the exclusive use of 5 haciendas owned and managed by Elizalde, and therefore the
importation was exempt from the 17% exchange tax in accordance with Section 2, RA 601, as
amended by RA 1375.

On 2 July 1956, the Auditor of the Central Bank denied the petition. The Central requested the Auditor
to reconsider his ruling, but after a re-examination of all pertinent papers the reconsideration was
denied. The Central then appealed to the Auditor General of the Philippines. On 18 January 1957, the
Auditor General affirmed the ruling of the Auditor of the Central Bank upon the ground that the
importation of the fertilizers does not fall within the scope of the exempting provisions of Section 2 of
RA 601, as amended by RA 1375; and thus affirming the decision of the Auditor, Central Bank of the
Philippines. The Central and Elizalde filed the petition for review in the Supreme Court.

Issue: Whether upon the importation of the fertilizers are covered by the exemption (provided by
Section 1 and 2 of Republic Act No. 601, as amended by Republic Acts 1175, 1197 and 1375).

Held: The law is, therefore, clear that imported fertilizers are exempt from the payment of the 17%
tax only if the same were imported by planters or farmers directly or through their cooperatives. The
exemption covers exclusively fertilizers imported by planters or farmers directly or through their
cooperatives. The word “directly” has been interpreted to mean “without anything intervening”.
Consequently, an importation of fertilizers made by a farmer or planter through an agent, other than
his cooperative, is not imported directly as required by the exemption.

When the issue is whether or not the exemption from a tax imposed by law is applicable, the rule is
that the exempting provision is to be construed liberally in favor of the taxing authority and strictly
against exemption from tax liability, the result being that statutory provisions for the refund of taxes
are strictly construed in favor of the State and against the taxpayer. Exempting from the 17% tax all
fertilizers imported by planters or farmers through any agent other than their cooperatives, this would
be rendering useless the only exception expressly established in the case of fertilizers imported by
planters or farmers through their cooperatives.
CIR v. CA
GR 115349, 18 April 1997 (271 SCRA 605)
Third Division, Panganiban (p): 4 concurring

Facts: Private respondent, the Ateneo de Manila University, is a non-stock, non-profit educational
institution with auxiliary units and branches all over the Philippines. One 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 8 July 1983, private respondent
received from Commissioner of Internal Revenue (CIR) a demand letter dated 3 June 1983, assessing
private respondent the sum of P174,043.97 for alleged deficiency contractor’s tax, and an assessment
dated 27 June 1983 in the sum of P1,141,837 for alleged deficiency income tax, both for the fiscal
year ended 31 March 1978. Denying said tax liabilities, private respondent sent petitioner a letter-
protest and subsequently filed with the latter a memorandum contesting the validity of the
assessments. On 17 March 988, petitioner rendered a letter-decision canceling the assessment for
deficiency income tax but modifying the assessment for deficiency contractor’s tax by increasing the
amount due to P193,475.55. Unsatisfied, private respondent requested for a reconsideration or
reinvestigation of the modified assessment.

At the same time, it filed in the respondent court a petition for review of the said letter-decision of the
petitioner. While the petition was pending before the respondent court, petitioner issued a final
decision dated 3 August 1988 reducing the assessment for deficiency contractor’s tax from
P193,475.55 to P46,516.41, exclusive of surcharge and interest. On 12 July 1993, the respondent
court set aside respondent’s decision, and canceling the deficiency contractor’s tax assessment in the
amount of P46,516.41 exclusive of surcharge and interest for the fiscal year ended 31 March 1978. No
pronouncement as to cost. On 27 April 1994, Court of Appeals, in CA-GR SP 31790, affirmed the
decision of the Court of Tax Appeals. Not in accord with said decision, petitioner came to Supreme
Court via a petition for review.

Issues:

• Whether the private respondent has the burden of

proof in the tax case.
• Whether the private respondent is taxable as an
independent contractor.

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

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

The Supreme Court denied the petition and affirmed the assailed Decision of the Court of Appeals. The
Court ruled that the private respondent is not a contractor selling its services for a fee but an
academic institution conducting these researches pursuant to its commitments to education and,
ultimately, to public service. For the institute to have tenaciously continued operating for so long
despite its accumulation of significant losses, we can only agree with both the Court of Tax Appeals
and the Court of Appeals that “education and not profit is motive for undertaking the research
projects.
Mactan Cebu (MCIAA) v. Marcos
GR 120082, 11 September 1996 (261 SCRA 667)
Third Division, Davide Jr. (p): 4 concurring.

Facts: Mactan Cebu International Airport Authority (MCIAA) was created by virtue of Republic Act
6958. Since the time of its creation, MCIAA enjoyed the privilege of exemption from payment of realty
taxes in accordance with Section 14 of its Charter. However on 11 October 1994, the Office of the
Treasurer of Cebu, demanded for the payment of realty taxes on several parcels of land belonging to
the petitioner. Petitioner objected to such demand for payment as baseless and unjustified. It also
asserted that it is an instrumentality of the government performing a governmental functions, which
puts limitations on the taxing powers of local government units. It nonetheless stands in the same
footing as an agency or instrumentality of the national government by the very nature of its powers
and functions. The 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 Government Code (LGC), and not an instrumentality of
the government but merely a government owned corporation performing proprietary functions. MCIAA
paid its tax account “under protest” when City is about to issue a warrant of levy against the MCIAA’s
properties.

On 29 December 1994, MCIAA filed a Petition of Declaratory Relief with the Cebu Regional Trial Court
contending that the taxing power of local government units do not extend to the levy of taxes or fees
on an instrumentality of the national government. It contends that by the nature of its powers and
functions, it has the footing of an agency or instrumentality of the national government; which claim
the City rejects. On 22 March 1995, the trial court dismissed the petition, citing that close reading of
the LGC provides the express cancellation and withdrawal of tax exemptions of Government Owned
and Controlled Corporations. MCIAA’s motion for reconsideration having been denied by the trial court
in its 4 May 1995 order, the petitioner filed the instant petition.

Issue: Whether the MCIAA is exempted from realty taxes.

Held: Tax statutes are construed strictly against the government and liberally in favor of the
taxpayer. But since taxes are paid for civilized society, 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 taxpayer and liberally in favor of the taxing authority. A claim of
exemption from tax payments must be clearly shown and based on language in the law too plain to be
mistaken. Elsewise stated, taxation is the rule, exemption therefrom is the exception. 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. Further, since taxation is the
rule and exemption therefrom the exception, the exemption may 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.

Mactan Cebu International Airport Authority (MCIAA) is a “taxable person” under its Charter (RA
6958), and 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. Since Republic Act 7160 or the Local Government Code
(LGC) expressly provides that “All general and special laws, acts, city charters, decrees [sic],
executive orders, proclamations and administrative regulations, or part of parts thereof which are
inconsistent with any of the provisions of this Code are hereby repealed or modified accordingly.” With
that repealing clause in the LGC, the tax exemption provided for in RA 6958 had been expressly
repealed by the provisions of the LGC. Therefore, MCIAA has to pay the assessed realty tax of its
properties effective after January 1, 1992 until the present.

The Supreme Court denied the petition, and affirmed the challenged decision and order of the RTC
Cebu; without pronouncement as to costs.
Serfino v. CA
GR L-40858, 15 September 1987
Second Division, Paras (p): 4 concurring.

Facts: On 25 August 1937, a parcel of land was patented in the name of Pacifico Casamayor (OCT
1839). On 14 December 1945, he sold said land in favor of Nemesia D. Balatazar (TCT No. 57-N, 18
January 1946). OCT 1839 was lost during the war and upon petition of Nemesia Baltazar, the Court of
First Instance of Negros Occidental ordered the reconstitution thereof. Pursuant thereto, OCT 14-R
(1839) was issued on 18 January 1946 in the name of Pacifico Casamayor. On that same day, TCT
57-N was issued in the name of Nemesia Baltazar but after the cancellation of OCT 14-R (1839). On
15 August 1951, Nemesia Baltazar, sold said property to Lopez Sugar Central Mill Co., and the latter
did not present the documents for registration until 17 December 1964 to the Office of the Registry of
Deeds. Said office refused registration upon its discovery that the same property was covered by
another certificate of title, TCT 38985, in the name of Federico Serfino. On 19 November 1964, the
spouses Serfinos mortgaged the land to the Philippine National Bank (PNB) to secure a loan in the
amount of P5,000.00; which was inscribed in TCT No. 38985.

The Lopez Sugar Central instituted an action to recover said land; and the lower court rendered a
decision ordering the cancellation of TCT No. 38985; issuance of a new TCT in the name of plaintiff;
and the payment of the plaintiff PNB the loan of spouses Serfinos secured by said land. Both parties
appealed from this decision of the trial court. Ruling on the assignment of errors, the appellate court
affirmed the judgment of the trial court with modification in its decision setting aside the decision of
the trial court declaring plaintiff liable to PNB for payment, however, ordering the plaintiff to reimburse
the Serfino spouses of the sum P1,839.49, representing the unpaid taxes and penalties paid by the
latter when they repurchased the property. Hence, the appeal by the spouses Serfino and PNB to the
Supreme Court.

Issue: Whether the auction sale of the disputed property was null and void.

Held: The assailed decision of the appellate court declares that the prescribed procedure in auction
sales of property for tax delinquency being in derogation of property rights should be followed
punctiliously. Strict adherence to the statutes governing tax sales is imperative not only for the
protection of the tax payers, but also to allay any possible suspicion of collusion between the buyer
and the public officials called upon to enforce such laws. Notice of sale to the delinquent land owners
and to the public in general is an essential and indispensable requirement of law, the non-fulfillment of
which vitiates the sale. In the present case, Lopez Sugar Central was not entirely negligent in its
payment of land taxes. The record shows that taxes were paid for the years 1950 to 1953 and a
receipt therefor was obtained in its name. The sale therefore by the Province of Negros Occidental of
the land in dispute to the spouses Serfinos was void since the Province of Negros Occidental was not
the real owner of the property thus sold. In turn, the spouses Serfinos title which has been derived
from that of the Province of Negros Occidental is likewise void. However, the fact that the public
auction sale of the disputed property was not valid cannot in any way be attributed to the mortgagee’s
fault. The inability of the Register of Deeds to notify the actual owner or Lopez Sugar Central of the
scheduled public auction sale was partly due to the failure of Lopez Sugar Central to declare the land
in its name for a number of years and to pay the complete taxes thereon. PNB is therefore entitled to
the payment of the mortgage loan as ruled by the trial court and exempted from the payment of
costs.
The Supreme Court affirmed the assailed decision, with modification that PNB mortgage credit must
be paid by Lopez Sugar Central.
Manahan v. ECC
GR L-44899, 22 April 1981 (104 SCRA 198)
First Division, Fernandez (p): 4 concurring.

Facts: Maria E. Manahan, the petitioner, is the widow of Nazario Manahan, Jr., who died of “Enteric
Fever” while employed as classroom teacher in Las Piñas Municipal High School, Las Piñas, Rizal, on 8
May, 1975. The deceased was in perfect health when he entered government service on 20 July 1969,
and that in the course of his employment in 1974, he was treated for epigastric pain. He succumbed
to enteric fever on May 8, 1975. Thus, the petitioner filed a claim with the Government Service
Insurance System (GSIS) for death benefit under Presidential Decree 626. In a letter dated 19 June
1975, the GSIS denied the claim on a finding that the ailment of Nazario Manahan, Jr., typhoid fever,
is not an occupational disease, and that enteric fever or paratyphoid is similar in effect to typhoid
fever, in the sense that both are produced by Salmonella organisms.

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

Issue: Whether the Workmen’s Compensation should be resolved in favor of the worker

Held: The Transitory and Final Provisions of the New Labor Code provides that all actions and claims
accruing prior to the effectivity of this Code shall be determined in accordance with the laws in force at
the time of their accrual and under the third paragraph of Article 292, Title II (Prescription of Offenses
and Claims), workmen’s compensation claims accruing prior to the effectivity of this Code and during
the period from 1 November 1974 up to 31 December 1974 shall be processed and adjudicated in
accordance with the laws and rules at the time their causes of action accrued Hence, this Court
applied the provisions of the Workmen’s Compensation Act, as amended, on passing upon petitioner’s
claim.. The illness that claimed the life of the deceased may had its onset before 10 December 1974,
thus, his action accrued before 10 December 1974. Still, In any case, and case of doubt, the same
should be resolved in favor of the worker, and that social legislations — like the Workmen’s
Compensation Act and the Labor Code — should be liberally construed to attain their laudable
objective, i.e., to give relief to the workman and/or his dependents in the event that the former should
die or sustain an injury. Pursuant to such doctrine and applying now the provisions of the Workmen’s
Compensation Act in this case, the presumption of compensability subsists in favor of the claimant.

The Supreme Court set aside the decision of the ECC and ordered the GSIS to pay the petitioner the
amount of P6,000.00 as death compensation benefit and P600.00 as attorney’s fees, to reimburse the
petitioner’s expenses incurred for medical services, hospitalization and medicines of the deceased
Nazario Manahan, Jr., duly supported by proper receipts, and to pay administrative fees.
Villavert v. ECC
GR L-48605, 14 December 1981 (110 SCRA 233)
First Division, Fernandez (p): 4 concurring

Facts: Domina N. Villavert, the petitioner, is the mother of the late Marcelino N. Villavert who died of
acute hemorrhagic pancreatitis on 12 December 1975 employed as a Code Verifier in the Philippine
Constabulary. The deceased also performed the duties of a computer operator and clerk typist. On 11
December 1975, the deceased reported as usual to the Constabulary Computer Center in Camp
Crame. He performed his duties not only as Code Verifier but also handled administrative functions,
computer operation and typing jobs due to shortage of civilian personnel. Although he was
complaining of chest pain and headache late in the afternoon of said day, he was required to render
overtime service until late in the day, typing voluminous classified communications, computing
allowances and preparing checks for the salary of PC-INP personnel throughout the country for
distribution on or before 15 December 1975. Gasping for breath, perspiring profusely, and mumbling
incoherent words while asleep, and when he was not able to regain consciousness, he was rushed to
the University of the East-Ramon Magsaysay (UERM) Memorial Hospital where he died at 5:30 am.
The NBI stated that the exact cause of acute hemorrhagic pancreatitis is still unknown, although most
research data agree that physical and mental stresses are strong causal factors in the development of
the disease.

On 18 March 1976, she filed a claim for income benefits for the death of her son under PD 626, as
amended, with the Government Service Insurance System (GSIS). GSIS denied the claim on the
ground that acute hemorrhagic pancreatitis is not an occupational disease and that the petitioner had
failed to show that there was a causal connection between the fatal ailment of Marcelino N. Villavert
and the nature of his employment. The petitioner appealed to the Employees Compensation
Commission (ECC). On 31 May 1978, the ECC affirmed the decision of GSIS denying the claim.
Hence, the petition.

Issue: Whether the petitioner is entitled to her son’s death benefits.

Held: The Medico Legal Officer of the NBI stated that the exact cause of acute hemorrhagic
pancreatitis (acute inflammation with hemorrhagic necrosis of the pancreas) is still unknown despite
extensive researches in this field, although most research data are agreed that physical and mental
stresses are strong causal factors in the development of the disease. There is no evidence at all that
Marcelino N. Villavert had a “bout of alcoholic intoxication” shortly before he died, neither is there a
showing that he used drugs; negating the association provided by Principles of Internal Medicine (by
Harrison 7th Edition, p. 1571). From the foregoing facts of record, it is clear that Marcelino N. Villavert
died of acute hemorrhagic pancreatitis which was directly caused or at least aggravated by the duties
he performed as code verifier, computer operator and clerk typist of the Philippine Constabulary.
Further, Article 4 of the Labor Code of the Philippines, as amended, provides that “all doubts in the
implementation and interpretation of this Code, including its implementing rules and regulations shall
be resolved in favor of labor.”

The Supreme Court set aside the decision of the ECC and ordered the GSIS to pay the petitioner death
benefits in the amount of P6,000.00.
Del Rosario & Sons v. NLRC
GR L-64204, 31 May 1985 (135 SCRA 669)
First Division, Melencio-Herrera (p): 5 concurring, 1 on leave

Facts: On 1 February 1978, Del Rosario and Sons Logging Enterprises, Inc. entered into a “Contract
of Services” with Calmar Security Agency whereby the latter undertook to supply the former with
security guards at the rate of P300.00 per month for each guard. Thereafter, Paulino Mabuti, Napoleo
Borata and Silvino Tudio filed a Complaint against the Security Agency and petitioner, for
underpayment of salary, non-payment of living allowance, and 13th month pay. Thereafter, five other
guards filed their complaint for the same causes of action. Petitioner contended that complainants
have no cause of action against it due to absence of employer-employee relationship between them.
They also denied liability alleging that due to the inadequacy of the amounts paid to it under the
Contract of Services, it could not possibly comply with the payments required by labor laws.

Assigned for compulsory arbitration, the Labor Arbiter rendered a decision dismissing the complaint for
want of employer-employee relationship. When the case was appealed to the NLRC, the decision was
modified by holding that petitioner is liable to pay complainants, jointly and severally, with the
Security Agency on the ground that the petitioner is an indirect employer pursuant to Articles 106 and
107. Hence, the appeal. The petitioner contended that NLRC erred in giving due course to the appeal
despite the fact that it was not under oath and the required appeal fee was not paid; in holding it
jointly and severally liable with the Security Agency; and in refusing to give due course to its Motion
for Reconsideration.

Issue(s):

• Whether the formal defects of the appeal of the

security agency invalidate the appeal.
• Whether the security guards from the agency are
entitled to benefits claimed from the company

Held: The formal defects in the appeal of the Security Agency were not fatal defects. The lack of
verification could have been easily corrected by requiring an oath. The appeal fee had been paid
although it was delayed. Failure to pay the docketing fees does not automatically result in the
dismissal of the appeal. Dismissal is discretionary with the Appellate Court and discretion must be
exercised wisely and prudently, never capriciously, with a view to substantial justice. Failure to pay
the appeal docketing fee confers a directory and not a mandatory power to dismiss an appeal and
such power must be exercised with sound discretion and with a great deal of circumspection,
considering all attendant circumstances.” Moreover, as provided for by Article 221 of the Labor Code
“in any proceeding before the Commission or any of the Labor Arbiters, the rules of evidence
prevailing in Courts of law or equity shall not be controlling and it is the spirit and intention of this
Code that the Commission and its members and the Labor Arbiters shall use every and all reasonable
means to ascertain the facts in each case speedily and objectively and without regard to technicalities
of law or procedure, all in the interest of due process.

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

The Supreme Court affirmed the judgment under review, without prejudice to petitioner’s right to seek
reimbursement from Calmar Security Agency for such amounts as petitioner may have to pay to
complainants. Costs against the private respondent.
Ty v. First National Surety
GR L-16138, 29 April 1961 (1 SCRA 1324)
En Banc, Labrador (p): 8 concurring

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

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

Issue: Whether Diosdado Ty is entitled to indemnity under the insurance policy for the disability of his
left hand.

Held: The agreement contained in the insurance policies is the law between the parties. As the terms
of the policies are clear, express and specific that only amputation of the left hand should be
considered as a loss thereof, an interpretation that would include the mere fracture or other
temporary disability not covered by the policies would certainly be unwarranted. In the case at bar,
due to the clarity of the stipulation, distinction between “temporary disability” and “total disability”
need not be made in relation to one’s occupation means that the condition of the insurance is such
that common prudence requires him to desist from transacting his business or renders him incapable
of working. While the Court sympathizes with the plaintiff or his employer, for whose benefit the
policies were issued, it can not go beyond the clear and express conditions of the insurance policies,
all of which define partial disability as loss of either hand by a amputation through the bones of the
wrist.” There was no such amputation in the case at bar.

The Supreme Court affirmed the appealed decision, with costs against the plaintiff-appellant.
De la Cruz v. Capital Insurance
GR L-21574, 30 June 1966 (17 SCRA 559)
En Banc, Barrera (p): 8 concurring

Facts: Eduardo de la Cruz was the holder of an accident insurance policy. In connection with the
celebration of the New Year, the insured, a non-professional boxer, participated in a boxing contest. In
the course of his bout with another person, likewise a non-professional, of the same height, weight
and size, Eduardo slipped and was hit by his opponent on the left part of the back of the head, causing
Eduardo to fall, with his head hitting the rope of the ring. The insured died with the cause of death
reported as hemorrhage intracranial, left. The insurer refused to pay the proceeds of the policy on the
ground that the death of the insured in a boxing contest, was not accidental and, therefore, not
covered by the insurance.

Simon de la Cruz, the father of the insured and beneficiary under the policy, filed a claim with the
insurance company for payment of indemnity under the insurance policy. Denied, De la Cruz
instituted the action in the CFI Pangasinan (Civ. Case No. U-265)) for specific performance. Defendant
insurer set up the defense that the death of the insured, caused by his participation in a boxing
contest, was not accidental and, therefore, not covered by insurance. After due hearing, the court
rendered the decision in favor of the plaintiff; ordering the insurance company to indemnify plaintiff
for the death of the latter’s son, to pay the burial expenses, and attorney’s fees. Hence, the appeal.

Issue: Whether the death of the insured is covered by the policy.

Held: The terms “accident” and “accidental” have not acquired any technical meaning, and are
construed by the courts in their ordinary and common acceptation. The terms mean that which
happen by chance or fortuitously, without intention and design, and which is unexpected, unusual, and
unforeseen. An accident is an event that takes place without one’s foresight or expectation: an event
that proceeds from an unknown cause, or is an unusual effect of a known cause and, therefore, not
expected. There is no accident when a deliberate act is performed unless some additional,
unexpected, independent, and unforeseen happening occurs which produces or brings about the result
of injury or death. Where the death or injury is not the natural or probable result of the insured’s
voluntary act, which produces the injury, the resulting death is within the protection of policies
insuring against the death or injury from accident. In the present case, while the participation of the
insured in the boxing contest is voluntary, if without the unintentional slipping of the deceased,
perhaps he could not have received that blow in the head and would not have died. Further, death or
disablement resulting from engagement in boxing contests was not declared outside of the protection
of the insurance contract (What was included was death or disablement consequent upon the Insured
engaging in football, hunting, pigsticking, steeplechasing, polo-playing, racing of any kind,
mountaineering, or motorcycling). Failure of the defendant insurance company to include death
resulting from a boxing match or other sports among the prohibitive risks leads inevitably to the
conclusion that it did not intend to limit or exempt itself from liability for such death.

The Supreme Court affirmed the appealed decision, with costs against appellant.
Qua Chee Gan v. Law Union and Rock Insurance
GR L-4611, 17 December 1955 (52 OG 1982)
First Division, Reyes JBL (p): 7 concurring.

Facts: Before WWII, Qua Chee Gan, a merchant of Albay, owned 4 warehouses in Tabaco, Albay used
for the storage of stocks of copra and of hemp in which he dealt extensively. They had been, with
their contents, insured with the Insurance Company since 1937, and the lose made payable to the
Philippine National Bank as mortgage of the hemp and copra, to the extent of its interest. On 21 July
1940, fire of undetermined origin that broke out and lasted almost one week, gutted and completely
destroyed Bodegas Nos. 1, 3 and 4, with the merchandise stored therein. Plaintiff-appellee informed
the insurer by telegram on the same date. The insurance Company resisted payment, claiming
violation of warranties and conditions, filing of fraudulent claims, and that the fire had been
deliberately caused by the insured or by other persons in connivance with him. Qua Chee Gan, his
brother Qua Chee Pao, and some employees of his were indicted and tried in 1940 for the crime of
arson but were acquitted by the trial court in a final decision on 9 July 1941.

With the civil case, Qua Chee Gan instituted the action in 1940 with the Court of First Instance of
Albay, seeking to recover the proceeds of certain fire insurance policies totalling P370,000, issued by
the Law Union & Rock Insurance Co., Ltd., through its agent, Warner, Barnes & Co., Ltd., upon certain
bodegas and merchandise of the insured that were burned on 21 June 1940. The records of the
original case were destroyed during the liberation of the region, and were reconstituted in 1946. After
a trial that lasted several years, the CFI rendered a decision in favor of the plaintiff, ordering the
insurance company to pay Qua Chee Gan the sum of P146,394.48 (1st cause of action), P150,000
(2nd), P5,000 (3rd), P15,000 (4th) , and P40,000 (5th), each bearing 80% interest per annum in
accordance with Section 91 (b) of the Insurance Act from 26 September 1940, until each is paid, with
costs against the defendant. It also dismissed the complaint in intervention of PNB without costs. The
Insurance Company appealed directly to the Supreme Court. It contends that a warranty in a fire
insurance policy prohibited the storage in the premises of oils (animal and/or vegetable and/or mineral
and their liquid products having a flash point below 300 degrees Fahrenheit. Gasoline, which has a
flash point below 300 degrees Fahrenheit was stored therein.

Issue: Whether gasoline may be construed as oil to warrant the forfeiture of claims under the
insurance policy.

Held: The Hemp Warranty provisions relied upon by the insurer speaks of “oils (animal and/or
vegetable and/or mineral and/or their liquid products having a flash point below 300° Fahrenheit”, and
is decidedly ambiguous and uncertain; for in ordinary parlance, “Oils” mean “lubricants” and not
gasoline or kerosene. By reason of the exclusive control of the insurance company over the terms and
phraseology of the contract, the ambiguity must be held strictly against the insurer and liberally in
favor of the insured, specially to avoid a forfeiture. There is no reason why the prohibition of keeping
gasoline in the premises could not be expressed clearly and unmistakably, in the language and terms
that the general public can readily understand, without resort to obscure esoteric expression. If the
company intended to rely upon a condition of that character, it ought to have been plainly expressed
in the policy. Still, it is well settled that the keeping of inflammable oils on the premises, though
prohibited by the policy, does not void it if such keeping is incidental to the business and according to
the weight of authority, even though there are printed prohibitions against keeping certain articles on
the insured premises the policy will not be avoided by a violation of these prohibitions, if the
prohibited articles are necessary or in customary use in carrying on the trade or business conducted
on the premises. In the present case, no gasoline was stored in the burned bodegas, and that “Bodega
No. 2” which was not burned and where the gasoline was found, stood isolated from the other insured
bodegas.

The Supreme Court found no reversible error in the judgment appealed from, thus affirming it; with
costs against the appellant.
Home Insurance v. Eastern Shipping Lines
GR L-34382, 20 July 1983 (123 SCRA 425)
First division, Gutierrez (p): 4 concurring, 2 on leave.

Facts: On 13 January 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 vessel is owned and operated by Eastern Shipping Lines. The shipment
was insured with Home Insurance against all risks in the amount of P1,580,105.06. 53 of the 2361
coils discharged from the vessel were in bad order. The Consignee ultimately received the 2,361 coils
with 73 coils loose and partly cut, and 28 coils and partly cut, which had to be considered as scrap.
The weight also had a net loss/shortage of 593.15 kgs, or 1,209.56 lbs. For the loss/damage suffered
by the cargo, Home Insurance paid the consignee under its insurance policy the amount of P3,260.44,
by virtue of which Home Insurance became subrogated to the rights and actions of the Phelps Dodge.
Home Insurance made demands for payment against Eastern Shipping and the transportation
company for reimbursement of the aforesaid amount but each refused to pay the same. (A case
“Home insurance v. NV Nedlloyd Lijnen” consolidated with this case is of the same nature).

Filing its cases in court, Home Insurance avers that it is a foreign insurance company authorized to do
business in the Philippines through its agent, Victor Bello (who holds office at Makati) in both cases. In
L-34382, Eastern Shipping Lines denies the allegation of plaintiff’s capacity to sue for lack of
knowledge or information sufficient to form a belief as to the truth thereof, while Angel Jose
Transportation admits the allegation. In L-34383, NV Nedlloyd Lijnen, Columbian Philippines, and
Guacods denied plaintiff’s capacity to sue. The court dismissed the complaints in the two cases on the
same ground, that the plaintiff failed to prove its capacity to sue, even if the petitioner had already
secured the necessary license to conduct its insurance business in the Philippines during the filing of
the case. Hence, the petition.

Issue: Whether a foreign corporation doing business in the Philippines initially without a license can
claim indemnity through Philippine Courts.

Held: 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. A harsh interpretation would disastrously embarrass trade, unlike if the law is given a
reasonable interpretation, it would markedly help in the development of trade. 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. In the present case, the lack of capacity at the time of the execution of the contracts
was cured by the subsequent registration. Such is also strengthened by the procedural aspects of
these cases.The petitioner sufficiently alleged its capacity to sue when it 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; as
required by Section 4, Rule 8 of the Rules of Court. 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.
Nevertheless, 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.

The Supreme Court consolidated and granted the petitions, reversed and set aside the CFI decisions.
In L-34382 (Civil Case 71923), Eastern Shipping Lines and Angel Jose Transportation Inc. are ordered
to pay the Home Insurance Company the sum of P1,630.22 each with interest at the legal rate from 5
January 1968 until fully paid. Each shall also pay one-half of the costs. The Court dismissed the
counterclaim of Angel Jose Transportation Inc. In L-34383, N. V. Nedlloyd Lijnen or its agent
Columbian Phil. Inc. was ordered to pay the petitioner the sum of P2,426.98 with interest at the legal
rate from 1 February 1968 until fully paid, the sum of P500.00 attorney’s fees, and costs. The Court
dismissed the complaint against Guacods, Inc.
Co v. Republic
GR L-12150, 26 May 1960 (108 Phil 775)
First Dvision, Bautista Angelo (p): 6 concurring

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

Petitioner filed his petition for naturalization in the trial court. After hearing, the court ordered that a
certificate of naturalization be issued to petitioner after the lapse of two years from the date the
decision becomes final and all the requisites provided for in RA 503. The government appealed the
decision of the trial court, raising the facts that did not state what principles of the Constitution he
knew, although when asked what laws of the Philippines he believes in, he answered “democracy.;
that he stated that his father had already filed his income tax return, when asked why he did not file
his income tax returns; and that he presented his alien certificate of registration, but not the alien
certificates of registration of his wife and child.

Issue: Whether petitioner failed to comply with the requirements prescribed by law in order to qualify
him to become a Filipino citizen.

Held: The scope of the word law in ordinary legal parlance does not necessarily include the
constitution, which is the fundamental law of the land, nor does it cover all the principles underlying
our constitution. Further, Philippine law requires that an alien to conducted himself in a proper and
irreproachable manner during the entire period of his residence in the Philippines in his relation with
the constituted government as well as with the community in which he is living. In the present case, in
so stating that he believes merely in our laws, he did not necessarily refer to those principles
embodied in our constitution which are referred to in the law; the belief in democracy or in a
democratic form of government is not sufficient to comply with the requirement of the law that one
must believe in the principles underlying our constitution. Further, petitioner failed to show that he
has complied with his obligation to register his wife and child with the Bureau of Immigration as
required by the Alien Registration Actl; and further failed to file his income tax return despite his fixed
salary of P1,440.00 a year and his profit of P1,000.00 in his tobacco business, and received an
amount less than P3,000 from his father as one-fourth of the proceeds of the sale of the store, the
total of which is more than what is required by law for one to file an income tax return.

The Supreme Court reversed the appealed decision, hold that the trial court erred in granting the
petition for naturalization, without pronouncement as to costs.
Lee Cho (@ Sem Lee) v. Republic
GR L-12408, 28 December 1959 (106 Phil 775)
En Banc, Bautista Angelo (p): 9 concurring

Facts: On 22 September 1907, petitioner was born in Amoy, China, of Chinese parents. He came to
the Philippines sometime in February 1921 and was given the corresponding alien certificate of
residence and registration. He settled in Cebu City (where he as continuously resided up to the
present time). Petitioner studied 1st to 7th grade in Cebu Chinese High School, a private institution
recognized by the government. He speaks and writes English and the Cebu dialect. He, having
associated with some Filipinos, engaged in the corn business in Cebu City (1921-WWII) and in the
lumber business (1946-present). He invested P5,000.00 capital in the business and at present the
actual worth of his share is about P20,000.00. Petitioner is receiving a monthly salary of P400.00 and
realizes a profit share worth P10,000.00 every year. He has no tax liability to the government. He
possesses all the qualifications and none of the disqualifications prescribed by law. As to his family, he
married one Sy Siok Bin on 8 December 1929 with whom he had 13 children, all born in the Cebu
City. All these children had been issued the corresponding alien certificate of registration, with the
exception of Lourdes Lee who married a naturalized Filipino citizen named Lim Kee Guan. With the
exception of William Lee who is not of school age, Angelita who reached 5th grade and Lourdes who
stopped in 3rd year high school, the other children are at present studying in private schools and
colleges recognized by the government.

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

Issue: Whether petitioner was able to comply with the requirements for naturalization.

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

The Supreme Court ruled that appealed decision is reversed, with costs against petitioner.
Guerrero v. CA
GR L-44570, 30 May 1986 (142 SCRA 136)
Second Division, Gutierrez (p): 4 concurring, 1 taking no part.

Facts: On 8 August 1963, RA 3844 abolished and outlawed share tenancy and put in its stead the
agricultural leasehold system. In 1969, Apolinario Benitez was taken by Manuel and Maria Guerrero to
take care of their 60 heads of cows which were grazing within their 21-hectare coconut plantation
situated at the Subprovince of Aurora, Quezon. Benitez was allowed for that purpose to put up a hut
within the plantation where he and his family stayed. In addition to attending to the cows, he was
made to clean the already fruitbearing coconut trees, burn dried leaves and grass and to do such
other similar chores. Harvest time which usually comes every 3 months. For his work related to the
coconuts, he shared 1/3 of the proceeds from the copra he processed and sold in the market. For
attending to the cows he was paid P500 a year.

On 10 September 1971, RA 6389 amending RA 3844 declared share tenancy relationships as contrary
to public policy. Sometime in the early part of 1973, Benitez was refrained from gathering nuts from
the 10-hectare portion of the 16-hectare part of the plantation from where he used to gather nuts. He
felt aggrieved by the acts of defendants and he brought the matter to the attention of the Office of
Special Unit in the Office of the President in Malacañang, Manila. This led to an execution of an
agreement whereby defendants agreed to let plaintiff work on the 16-hectare portion of the plantation
as tenant thereon and that their relationship will be guided by the provisions of RA 1199 (Agricultural
Tenancy Act of the Philippines).

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

Issue: Whether Benitez is a tenant within the meaning of the tenancy law to warrant reinstatement to
the plantation

Held: Longstanding possession is an essential distinction between a mere agricultural laborer and a
real tenant within the meaning of the tenancy law, a tenant being one who has the temporary use and
occupation of land or tenements belonging to another for the purpose of production. A hired laborer
who built his own house at his expense at the risk of losing the same upon his dismissal or termination
any time, is more consistent with that of an agricultural tenant who enjoys security of tenure under
the law. Cultivation is another important factor in determining the existence of tenancy relationships.
Cultivation is not limited merely to the tilling, plowing or harrowing of the land but also includes the
promotion of growth and the care of the plants, or husbanding the ground to forward the products of
the earth by general industry. Agreement to share the produce or harvest on a “tercio basis” that is,
a 1/3 to 2/3 sharing in favor of the landowners bolsters the tenancy claim. The agricultural laborer
works for the employer, and for his labor he receives a salary or wage, regardless of whether the
employer makes a profit. On the other hand, the share tenant participates in the agricultural produce.
His share is necessarily dependent on the amount of harvest. Once a tenancy relationship is
established, the tenant has the right to continue working until such relationship is extinguished
according to law. In the present case, besides these indications, the agreement made on 2 May 1973
is clear and categorical term that the Benitez is a tenant. Arguing that the intent was different, being
that of a hired farmhand, the law existing at that time the agreement was made militate against the
claim. Benitez did not commit any of the causes that would warrant his ejectment, and thus, was
unlawfully deprived of his right to security of tenure and the Court of Agrarian Reforms did not err in
ordering the reinstatement of respondent as tenant and granting him damages therefor.

The Supreme Court dismissed the petition for lack of merit, and affirmed the CA decision. No costs.
Bello v. CA
GR L-38161, 29 March 1974 (56 SCRA 509)
En Banc, Teehankee (p): 10 concurring.

Facts: On 25 August 1970, spouses Juan and Filomena Bello were charged for estafa before the City
Court of Pasay for allegedly having misappropriated a lady’s ring with a value of P1,000.00 received
by them from Atty. Prudencio de Guzman for sale on commission basis. After trial, they were
convicted. Petitioners filed their notice of appeal of the adverse judgment to the Court of First
Instance (CFI) of Pasay City, but the prosecution filed a “petition to dismiss appeal” on the ground
that since the case was within the concurrent jurisdiction of the city court and the CFI and the trial in
the city court had been duly recorded, the appeal should have been taken directly to the Court of
Appeals as provided by section 87 of the Judiciary Act, Republic Act 296, as amended. The CFI per its
order of 29 October 1971 did find that the appeal should have been taken directly to the Court of
Appeals but ordered the dismissal of the appeal and remand of the records to the city court “for
execution of judgment.” Thereafter, the City court denied petitioners’ motion “for having been
erroneously addressed to this court” instead of to the CFI ignoring petitioners’ predicament that the
CFI had already turned them down and ordered the dismissal of their appeal without notice to them
and that as a consequence it was poised to execute its judgment of conviction against them.

Petitioners spouses then filed on 14 January 1972 their petition for prohibition and mandamus with
the Court of Appeals against the People and City Court. The Solicitor General did not interpose any
objection whichever viewpoint is adopted by the Honorable Court in resolving the two apparently
conflicting or clashing principles of law, i.e.. finality of judicial decision or equity in judicial decision.
The Court of Appeals, however, dismissed the petition on 17 December 1973, after finding that the
city court’s judgment was directly appealable to it. Although recognizing that the CFI instead of
dismissing appeal, could have in the exercise of its inherent powers directed appeal to be endorsed to
the Court of Appeals, it held that since petitioners did not implead the CFI as principal party
respondent it could not grant any relief at all even on the assumption that petitioners can be said to
deserve some equities. With their motion for reconsideration denied, petitioners filed the petition for
review.

Issue: Whether the formal impleading of the Court of First Instance is indispensable and the
procedural infirmity of misdirecting the appeal to Court of First Instance are fatal to the appellees’
cause

Held: The construction of statutes is always cautioned against narrowly interpreting a statute as to
defeat the purpose of the legislator and it is of the essence of judicial duty to construe statutes so as
to avoid such a deplorable result (of injustice or absurdity” and therefore a literal interpretation is to
be rejected if it would be unjust or lead to absurd results. Thus, in the construction of its own Rules of
Court, the Court is all the more so bound to liberally construe them to avoid injustice, discrimination
and unfairness and to supply the void by holding that Courts of First Instance are equally bound as the
higher courts not to dismiss misdirected appeals timely made but to certify them to the proper
appellate court.

The formal impleading of the CFI which issued the challenged order of dismissal was not indispensable
and could be “overlooked in the interest of speedy adjudication. The Court of Appeals ‘ act of
dismissing the petition and denying the relief sought of endorsing the appeal to the proper court
simply because of the non-impleader of the CFI as a nominal party was tantamount to sacrificing
substance to form and to subordinating substantial justice to a mere matter of procedural technicality.
The procedural infirmity of petitioners misdirecting their appeal to the CFI rather than to the Court of
Appeals, which they had timely sought to correct in the CFI itself by asking that court to certify the
appeal to the Court of Appeals as the proper court, should not be over-magnified as to totally deprive
them of their substantial right of appeal and leave them without any remedy.

The Supreme Court set aside the CA decision dismissing the petition and in lieu thereof, judgment was
rendered granting the petition for prohibition against City court, enjoining it from executing its
judgment of conviction against petitioners-accused and further commanding said city court to elevate
petitioners’ appeal from its judgment to the CA for the latter’s disposition on the merits; without costs.
City of Manila v. Chinese Community of Manila
GR 14355, 31 October 1919 (40 Phil
First Division, Johnson (p): 4 concurring.

Facts: On the 11th day of December, 1916, the city of Manila presented a petition in the Court of First
Instance of said city, praying that certain lands, therein particularly described, be expropriated for the
purpose of constructing a public improvement, specifically for the purpose of extending Rizal Avenue.
The Chinese Community opposed the said expropriation, contending that there was no necessity of
taking, that it already had public character and that it would it would disturb the resting places of the
dead.

The trial court decided that there was no necessity for the expropriation of the strip of land and
absolved each and all of the defendants from all liability under the complaint, without any finding as to
costs. From the judgment, the City of Manila appealed.

Issue: Whether the Chinese cemetery may be validly expropriated by the City of Manila

Held: The exercise of the right of eminent domain, whether directly by the State, or by its authorized
agents, is necessarily in derogation of private rights, and the rule in that case is that the authority
must be strictly construed. No species of property is held by individuals with greater tenacity, and
none is guarded by the constitution and laws more sedulously, than the right to the freehold of
inhabitants. When the legislature interferes with that right, and, for greater public purposes,
appropriates the land of an individual without his consent, the plain meaning of the law should not be
enlarged by doubtly interpretation.

The right of expropriation is not an inherent power in a municipal corporation, and before it can
exercise the right some law must exist conferring the power upon it. When the courts come to
determine the question, they must not only find (a) that a law or authority exists for the exercise of
the right of eminent domain, but (b) also that the right or authority is being exercised in accordance
with the law. In the present case there are two conditions imposed upon the authority conceded to the
City of Manila: First, the land must be private; and, second, the purpose must be public. If the court,
upon trial, finds that neither of these conditions exists or that either one of them fails, certainly it
cannot be contended that the right is being exercised in accordance with law. It is a well known fact
that cemeteries may be public or private. The former is a cemetery used by the general community, or
neighborhood, or church, while only a family, or a small portion of the community or neighborhood
uses the latter. Where a emetery is open to the public, it is a public use and no part of the ground can
be taken for other public uses under a general authority. And this immunity extends to the
unimproved and unoccupied parts, which are held in good faith for future use. It is alleged, and not
denied, that the cemetery in question may be used by the general community of Chinese, which fact,
in the general acceptation of the definition of a public cemetery, would make the cemetery in question
public property. If that is true, then, of course, the petition of the plaintiff must be denied, for the
reason that the city of Manila has no authority or right under the law to expropriate public property.
But, whether or not the cemetery is public or private property, its appropriation for the uses of a
public street, especially during the lifetime of those specially interested in its maintenance as a
cemetery, should be a question of great concern, and its appropriation should not be made for such
purposes until it is fully established that the greatest necessity exists therefor. In this case there is no
necessity of taking since there are other ways by which Rizal Avenue may be expanded to ease the
traffic situation.
The Supreme Court held that there is no proof of the necessity of opening the street through the
cemetery from the record. But that adjoining and adjacent lands have been offered to the city free of
charge, which answers every purpose of the City. The Supreme Court, thus, affirmed the judgment of
the lower court, with costs against the appellant.
Villanueva v. Comelec (Resolution)
GR L-54718, 4 December 1985
En Bank, Teehankee (p): 9 concurring, 2 on leave

Facts: On 4 January 1980, the last day for filing of certificates of candidacy, one Narciso Mendoza, Jr.
filed his sworn certificate of candidacy as independent for the office of vice-mayor of Dolores, Quezon
in the 30 January 1980 local elections. Later that day, however, Mendoza filed an unsworn letter in his
own handwriting withdrawing his said certificate of candidacy “for personal reasons.” His unsworn
withdrawal had been accepted by the election registrar without protest nor objection. Later on 25
January 1980, petitioner Crisologo Villanueva, upon learning of his companion Mendoza’s withdrawal,
filed his own sworn “Certificate of Candidacy in substitution” of Mendoza’s for the said office of vice
mayor as a one-man independent ticket. The results showed petitioner to be the clear winner over
respondent with a margin of 452 votes. The Municipal Board of Canvassers, however, disregarded all
votes cast in favor of petitioner as stray votes on the basis of the Provincial Election Officer’s opinion
that petitioner’s name does not appear in the certified list of candidates. The canvassers accordingly
proclaimed respondent Vivencio G. Lirio as the only unopposed candidate and as the duly elected vice
mayor of Dolores.

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

Issue: Whether the informal withdrawal of Mendoza invalidates the election of Villanueva as vice
mayor.

Held: Section 28 of the 1978 Election Code provides for such substitute candidates in case of death,
withdrawal or disqualification up to mid-day of the very day of the elections. Mendoza’s withdrawal
was filed on the last hour of the last day for regular filing of candidacies, which he had filed earlier
that same day. For all intents and purposes, such withdrawal should therefore be considered as having
been made substantially and in truth after the last day, even going by the literal reading of the
provision by the Comelec. Further, the will of the electorate should be respected, it should not be
defeated through the invocation of formal or technical defects. The will of the people cannot be
frustrated by a technicality that the certificate of candidacy had not been properly sworn to. This legal
provision is mandatory and non-compliance therewith before the election would be fatal to the status
of the candidate before the electorate, but after the people have expressed their will, the result of the
election cannot be defeated by the fact that the candidate has not sworn to his certificate or
candidacy. The legal requirement that a withdrawal be under oath will be held to be merely directory
and Mendoza’s failure to observe the requirement should be considered a harmless irregularity. The
bona fides of petitioner Villanueva as a substitute candidate cannot be successfully assailed. The votes
cast in his favor must be counted.

The Supreme Court resolved to reconsider and sets aside the questioned Resolutions of Comelec and
annuls the proclamation of Lirio as elected vice-mayor of Dolores, Quezon and instead declares
petitioner as the duly elected vice-mayor of said municipality and entitled forthwith to assume said
office, take the oath of office and discharge its functions. The resolution is made immediately
executory.
In RE Tampoy: Diosdada Alberastine, petitioner
GR L-14322, 25 February 1960 (107 Phil 100)
En Banc, Bautista Angelo (p): 10 concurring

Facts: On 19 November 1939, Petronila Tampoy, a widow and without children, requested with
Bonifacio Minoza to read a testament and explain its contents to her in her house in San Miguel street,
municipality of Argao, province of Cebu in 19 November 1939, which he did in the presence of tree
instrumental witnesses, Rosario K. Chan, Mauricio de la Pena, and Simeona Omboy. After confirming
the contents of the testament, she requested Bonifacio Minoza to write her name at the foot of the
testament in the second page, which he did, and after which she stamped her thumbmark between
her name and surname in the presence of all three instrumental witnesses. Bonifacio Minoza also
signed at the foot of the testament, in the second page, in the presence of the testator and all three
abovenamed witnesses. However, the testator, just like Bonifacio Minoza, did not sign on the left
margin or any part of the first page of the testament, composed of two pages. All the three
instrumental witnesses signed at the foot of the acknowledgment written in the second page of the
testament, and the left margin of the first and second page, in the presence of the testator, Bonifacio
Minoza, Atty. Kintanar, and the others. The testament was executed freely and spontaneously, without
having been threatened, forced and intimidated, and not having exercised on her (the testator) undue
influence, being the same in full use of her mental faculties and enjoying good health. On 22 February
1957, the testator died in here house in Argao.

On 7 March 1957, or two weeks after, the heir found in the testament, Carman Aberastine died,
leaving her mother, the petitioner Diosdada Alberastine. After trial on the probate o a document
purportedly to be the last and testament of Petronila Rampoy, the trial court denied the petition on
the ground that the left hand margin of the first page of the will does not bear the thumbmark of the
testatrix. Petitioner appealed from this ruling. The Court of Appeals certified the case to the Supreme
Court because it involves purely a question of law.

Issue: Whether the absence of the testator’s thumbmark in the first page is fatal to render the will
void

Held: Statutes prescribing the formalities to be observed in the execution of wills are very strictly
construed. A will must be executed in accordance with the statutory requirements; otherwise it is
entirely void. In the present case, the contention that the petition for probate is unopposed, and that
the three testimonial witnesses testified and manifested to the court that the document expresses the
true and voluntary will of the deceased, cannot be sustained as it runs counter to the express
provision of the law. Since the will suffers the fatal defect, as it does not bear the thumbmark of the
testatrix on its first page even if it bears the signature of the three instrumental witnesses, the same
fails to comply with the law and therefore cannot be admitted to probate.

The Supreme Court affirmed the appealed order, without pronouncement as to costs.
Matabuena v. Cervantes
GR L-28771, 31 March 1971 (38 SCRA ___)
En Banc, Fernando (p): 9 concur, 1 took no part

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

Issue: Whether the Article 133 of the civil code apply to donations between live-in partners.

Held: While Article 133 of the Civil Code considers as void a “donation between the spouses during
the marriage,” policy considerations of the most exigent character as well as the dictates of morality
require that the same prohibition should apply to a common-law relationship, as it is contrary to public
policy. The law prohibits donations in favor of the other consort and his descendants because of fear of
undue and improper pressure and influence upon the donor, a prejudice deeply rooted in ancient law.
Whatever omission may be apparent in an interpretation purely literal of the language used must be
remedied by an adherence to its avowed objective. It is a principle of statutory construction that what
is within the spirit of the law is as much a part of it as what is written. Otherwise the basic purpose
discernible in such codal provision would not be attained.

The Supreme Court (1) reversed the 23 November 1965 decision of the lower court; (2) declared the
questioned donation void and recognized the rights of plaintiff and defendant as pro indiviso heirs to
the property; and (3) remanded the case to the lower court for its appropriate disposition in
accordance with the current decision; without pronouncement as to costs.
People v. Santayana
GR L-22291, 15 November 1976 (74 Phil 25)
Second Division, Concepcion Jr. (p): 4 concur, 1 took no part, 1 designated to sit in 2nd division

Facts: On 19 February 1962, Jesus Santayana y Escudero, was appointed as “Special Agent” by then
Colonel Jose C. Maristela, Chief of the CIS. On 9 March 1962, Col. Maristela issued an undated
certification to the effect that the accused was an accredited member of the CIS and the pistol
described in the said Memorandum Receipt was given to him by virtue of his appointment as special
agent and that he was authorized to carry and possess the same in the performance of his official duty
and for his personal protection. On 29 October 1962, the accused was found in Plaza Miranda in
possession of the firearms and ammunition without a license to possess them. An investigation was
conducted and thereupon, a corresponding complaint was filed against the accused. The case
underwent trial after which the accused was convicted of the crime charged. Hence, the case was
appealed to Supreme Court.

Issue: Whether Santayana, a secret agent, was liable for illegal possession of firearms

Held: The appointment of a civilian as “secret agent to assist in the maintenance of peace and order
campaigns and detection of crimes sufficiently puts him within the category of a peace officer
equivalent even to a member of the municipal police expressly covered by Section 879 (People v.
Macarandang). In the present case, Santayana was appointed as CIS secret agent with the authority
to carry and possess firearms. He was issued a firearm in the performance of his official duties and for
his personal protection. Application of license was unnecessary, according to Col. Maristela, as the
firearm is government property. No permit was issued, according to Capt. Adolfo Bringas as he was
already appointed as a CIS agent. Even if the case of People vs. Mapa revoked the doctrine in the
Macarandang case, this was made only on 30 August 1967, years after the accused was charged.
Under the Macarandang rule therefore obtaining at the time of appellant’s appointment as secret
agent, he incurred no criminal liability for possession of the pistol in question.

The Supreme Court reversed the appealed decision, conformably with the recommendation of the
Solicitor General, and acquitted Jesus Santayana, canceling the bond for his provisional release; with
costs de oficio.
People v. Estenzo
GR L-35376, 11 September 1980 (99 SCRA 651)
First Division, de Castro (p): 5 concur

Facts: In a decision dated 28 September 1940 by the Cadastral Court, Lot 4273 of the Ormoc
Cadastre was declared public land. Respondent Aotes filed on23 February 1972 a petition to reopen
the decision of the Cadastral Court under Repuplic Act 931 as amended by Republic Act 6236. Aotes
claim that since the time limit for filing applications for free patents and applications for judicial
confirmation of incomplete and imperfect titles have been extended up to 31 December 1980, the
reopening of cadastral cases is also extended until 31 December 1980. The judge denied the
opposition for lack of sufficient merit on 9 May 1972, and rendered decision on 22 July 1972 after due
hearing, declaring Lot 4273 public land and adjudicating said lot in favor of the Aoetes in undivided
interest in equal share of ¼ each. Dissatisfied with the decision of the lower court, petitioners filed the
instant petition.

Issue: Whether the extension provided for under RA 6263 also applies to Re-opening of Cadastral
Proceedings.

Held: Under the legal maxim of statutory construction, expressio unius est exclusio alterius (Express
Mention is Implied Exclusion), the express mention of one thing in a law, as a general rule, means the
exclusion of others not expressly mentioned. This rule, as a guide to probable legislative intent, is
based upon the rules of logic and the natural workings of the human mind. If RA 6236 had intended
that the extension it provided for applies also to reopening of cadastral cases, it would have so
provided in the same way that it provided the extension of time to file applications for free patent and
for judicial confirmation of imperfect or incomplete title. The intention to exclude the reopening of
cadastral proceedings or certain lands which were declared public land in RA 6236 is made clearer by
reference to RA2061 which includes the reopening of cadastral cases, but not so included in RA 6236.
Thus, RA 6236, the very law on which Aotes bases his petition to reopen the cadastral proceedings
fails to supply any basis for respondents’ contention. It will be noted that while RA 2061 fixed the time
to reopen cadastral cases which shall not extend beyond 31 December 1968, no similar provision is
found in RA 6236 expressly extending the time limit for the reopening of cadastral proceedings on
parcels of land declared public land. As correctly pointed out by petitioners, the extension as provided
for by the RA 6236 makes no reference to reopening of cadastral cases as the earlier law, RA2061,
expressly did. Truly, the extension provided for by RA 6236 applies only to the filing of applications
for free patent and for judicial confirmation of imperfect or incomplete titles and not to reopening of
cadastral proceedings like the instant case, a proceeding entirely different from “filing an application
for a free patent or for judicial confirmation of imperfect or incomplete titles.”

The Supreme Court set aside the 22 July 1972 decision of the respondent Judge and reiterating the 28
September 1940 decision of the Cadastral Court; without pronouncement as to costs.
Mutuc v. Comelec
GR L-32717, 26 November 1970 (36 SCRA 228)
First Division, Fernando (p): 7 concur, 2 on leave, 1 concur in separate opinion

Facts: The Commission on Elections (COMELEC) prohibited petitioner Amelito Mutuc, a candidate for
the position of a delegate to the Constitutional Convention, from using “jingles in his mobile units
equipped with sound systems and loud speakers” on 22 October 1970. Petitioner impugned the act of
respondent as violative of his right to free speech. Respondent however contended that the
prohibition was premised on a provision of the Constitutional Convention Act, which made it unlawful
for candidates “to purchase, produce, request or distribute sample ballots, or electoral propaganda
gadgets such as pens, lighters, fans (of whatever nature), flashlights, athletic goods or materials,
wallets, bandanas, shirts, hats, matches, cigarettes, and the like, whether of domestic or foreign
origin.” It was its contention that the jingle proposed to be used by petitioner is the recorded or taped
voice of a singer and therefore a tangible propaganda material, under the phrase “and the like.”

Issue: Whether the taped jingles fall under the phrase “and the like.”

Held: Under the well-known principle of ejusdem generis, the general words following any
enumeration are applicable only to things of the same kind or class as those specifically referred to. It
is quite apparent that what was contemplated in the Act was the distribution of gadgets of the kind
referred to as a means of inducement to obtain a favorable vote for the candidate responsible for its
distribution. The Constitutional Convention Act contemplated the prohibition on the distribution of
gadgets of the kind referred to as a means of inducement to obtain a favorable vote for the candidate
responsible for its distribution (distribution of electoral propaganda gadgets, mention being made of
pens, lighters, fans, flashlights, athletic goods or materials, wallets, bandanas, shirts, hats, matches,
and cigarettes, and concluding with the words “and the like.”). Taped jingles therefore were not
prohibited.

The Supreme Court decision was made to expound on the reasons behind the minute resolution of 3
November 1970. The Supreme Court permanently restrained and prohibited the Comelec from
enforcing or implementing or demanding compliance with its order banning the use of political taped
jingle, pursuant to the SC resolution of 3 November 1970; without pronouncement as to costs.
People v. Manantan
GR L-14129, 31 July 1962 (5 SCRA 684)
En Banc, Regala (p): 7 concur, 1 took no part, 1 on leave

Facts: In an information filed by the Provincial Fiscal of Pangasinan in the Court of First Instance (CFI)
of that Province, Guillermo Manantan was charged with a violation of Section 54 of the Revised
Election Code. A preliminary investigation conducted by said court resulted in the finding of a probable
cause that the crime charged was committed by the defendant. Thereafter, the trial started upon
defendant’s plea of not guilty, the defense moved to dismiss the information on the ground that as
justice of the peace, the defendant is not one of the officers enumerated in Section 54 of the Revised
Election Code. The lower court denied the motion to dismiss, holding that a justice of the peace is
within the purview of Section 54. A second motion was filed by defense counsel who cited in support
thereof the decision of the Court of Appeals (CA) in People vs. Macaraeg, where it was held that a
justice of the peace is excluded from the prohibition of Section 54 of the Revised Election Code. Acting
on various motions and pleadings, the lower court dismissed the information against the accused upon
the authority of the ruling in the case cited by the defense. Hence, the appeal by the Solicitor General.

Issue: Whether the justice of the peace was excluded from the coverage of Section 54 of the Revised
Election Code

Held: Under the rule of Casus omisus pro omisso habendus est, a person, object or thing omitted
from an enumeration must be held to have been omitted intentionally. The maxim “casus omisus” can
operate and apply only if and when the omission has been clearly established. The application of the
rule of “casus omisus” does not proceed from the mere fact that a case is criminal in nature, but
rather from a reasonable certainty that a particular person, object or thing has been omitted from a
legislative enumeration. Substitution of terms is not omission. For in its most extensive sense the
term “judge” includes all officers appointed to decide litigated questions while acting in that capacity,
including justice of the peace, and even jurors, it is said, who are judges of facts. The intention of the
Legislature did not exclude the justice of the peace from its operation. In Section 54, there is no
necessity to include the justice of peace in the enumeration, as previously made in Section 449 of the
Revised Administrative Code, as the legislature has availed itself of the more generic and broader
term “judge,” including therein all kinds of judges, like judges of the courts of First Instance, judges of
the courts of Agrarian Relations, judges of the courts of Industrial Relations, and justices of the peace.

The Supreme Court set aside the dismissal order entered by the trial court and remanded the case for
trial on the merits.
Lopez vs. CTA
GR L-9274, 1 February 1957 (100 Phil 850)
En Banc, Montemayor (p): 10 concur

Facts: Lopez & Sons imported hexagonal wire netting from Hamburg, Germany. The Manila Collector
of Customs assessed the corresponding customs duties on the importation on the basis of consular
and supplier invoices. Said customs duties were paid and the shipments were released. Subsequently,
however, the Collector reassessed the dollar value of the cost and freight of said wire netting and as a
result of the reassessment, additional customs duties in the amount of P1,966.59 were levied and
imposed upon petitioner. Failing to secure a reconsideration of the reassessment and levy of additional
customs duties, Lopez & Sons appealed to the Court of Tax Appeals. Acting upon a motion to dismiss
the appeal, filed by the Solicitor General on the ground of lack of jurisdiction, the Tax Court, by its
resolution of 23 May 1955, dismissed the appeal on the ground hat it had no jurisdiction to review
decisions of the Collector of Customs of Manila, citing section 7 of RA 1125, creating said tax court.
From said resolution of dismissal, Lopez & Sons appealed to the Supreme Court, seeking reversal of
said resolution of dismissal.

Issue: Whether the decision of the Collector of Customs is directly appealable to the Court of Tax
Appeal.

Held: Section 7 of Republic Act 1125 specifically provides that the Court of Tax Appeals (CTA) has
appellate jurisdiction to review decisions of the Commissioner of Customs. On the other hand, section
11 of the same Act in lifting the enumerating the persons and entities who may appeal mentions
among others, those affected by a decision or ruling of the Collector of Customs, and fails to mention
the Commissioner of Customs. While there is really a discrepancy between the two sections, it is more
reasonable and logical to hold that in section 11 of the Act, the Legislature meant and intended to say,
the Commissioner of Customs, instead of Collector of Customs. If persons affected by a decision of
the Collector of Customs may appeal directly to the Court of Tax Appeals, then the supervision and
control of the Commissioner of Customs over his Collector of Customs, under the Customs Law found
in sections 1137 to 1419 of the Revised Administrative Code, and his right to review their decisions
upon appeal to him by the persons affected by said decision would, not only be gravely affected but
even destroyed. The Courts are not exactly indulging in judicial legislation but merely endeavoring to
rectify and correct a clearly clerical error in the wording of a statute, in order to give due course and
carry out the evident intention of the legislature.

The Supreme Court affirmed the appealed order, holding that under the Customs Law and RA 1125,
the CTA has no jurisdiction to review by appeal decision of the Collector of Customs; with costs.
Sanciangco v. Rono
GR L-68709, 19 July 1985 (137 SCRA ___)
En Banc, Melencio-Herrera (p): 10 concur, 1 dissents in separate opinion, 1 took no part

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

Issue: Whether the accused is considered resigned from the latter’s filing of a certificate of candidacy
for the Batasan.

Held: Although it may be that Section 13(2), Batas Pambansa 697, admits of more than one
construction, taking into sconsideration the nature of the positions of the officials enumerated therein,
namely, governors, mayors, members of the various sanggunians or barangay officials, the legislative
intent to distinguish between elective positions in section 13(2), as contrasted to appointive positions
in section 13(l) under the all-encompassing clause reading “any person holding public appointive office
or position,” is clear. It is a rule of statutory construction that when the language of a particular
section of a statute admits of more than one construction, that construction which gives effect to the
evident purpose and object sought to be attained by the enactment of the statute as a whole, must be
followed. A statute’s clauses and phrases should not be taken as detached and isolated expressions,
but the whole and every part thereof must be considered in fixing the meaning of any of its parts.
The legislative intent to cover public appointive officials in subsection (1), and officials mentioned in
subsection (2) which should be construed to refer to local elective officials, can be gleaned from the
proceedings of the Batasan Pambansa. Since petitioner is unquestionably an appointive member of the
Sangguniang Panlungsod of Ozamiz City, as he was appointed by the President as a member of the
City’s Sangguniang Panlungsod by virtue of his having been elected President of the Association of
Barangay Councils, he is deemed to have ipso facto ceased to be such member when he filed his
certificate of candidacy for the 14 May 1984 Batasan elections.

The Supreme Court dismissed the petition and denied the writs prayed for, holding that there was no
grave abuse of discretion on the part of the officials; without costs.
Capati v. Ocampo [GR L-28742, 30 April 1982]
Second Division, Escolin (p): 4 concur, 2 on leave.

Facts: Virgilio Capati, a resident of Bacolor, Pampanga was the contractor of the Feati Bank for the
construction of its building in Iriga, Camarines Sur. On 23 May 1967, Capati entered into a sub-
contract with the Dr. Jesus Ocampo, a resident of Naga City, whereby the latter, in consideration of
the amount of P2,200.00, undertook to construct the vault walls, exterior walls and columns of the
said Feati building in accordance with the specifications indicated therein. Ocampo further bound
himself to complete said construction on or before 5 June 1967. Ocampo, however, was only able to
finish the construction on 20 June 1967.

Due to the delay, Capati filed in the CFI Pampanga an action for recovery of consequential damages
(Civil Case 3188) in the sum of P85,000.00 with interest, plus attorney’s fees and costs. Ocampo filed
a motion to dismiss the complaint on the ground that venue of action was improperly laid. The motion
was premised on the stipulation printed at the back of the contract which provides that all actions
arising out, or relating to this contract may be instituted in the CFI of the City of Naga. The lowe court
dismissed the complaint. Hence the appeal.

The Supreme Court set aside the appealed order, and ordered the return of the records to the court of
origin for further proceedings, with costs against defendant-appellee Ocampo.

1. Where personal actions may be filed

The rule on venue of personal actions cognizable by the CFI is found in Section 2(b), Rule 4 of the
Rules of Court, which provides that such actions may be commenced and tried where the defendant or
any of the defendants resides or may be found, or where the plaintiff or any of the plaintiffs resides,
at the election of the plaintiff. Said section is qualified by Section 3 of the same rule, providing that by
written agreement of the parties the venue of an action may be changed or transferred from one
province to another.

2. “May” only permissive

The word “may” is merely permissive and operates to confer discretion upon a party. Under ordinary
circumstances, the term “may be” connotes possibility; it does not connote certainty. “May” is an
auxillary verb indicating liberty, opportunity, permission or possibility. In the case at bar, the
stipulation as to venue in the contract in question is simply permissive. By the said stipulation, the
parties did not agree to file their suits solely and exclusively with the CFI Naga. They merely agreed to
submit their disputes to the said court, without waiving their right to seek recourse in the court
specifically indicated in Section 2(b), Rule 4 of the Rules of Court (See related case in Nicolas v.
Reparations Commission: “May” is not mandatory). Since the complaint has been filed in the CFI
Pampanga, where the plaintiff resides, the venue of action is properly laid in accordance with Section
2(b), Rule 4 of the Rules of Court.
Alfon v. Republic [GR L-51201, 29 May 1980]
Second Division, Abad Santos (p): 4 concur

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

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

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

1. Principally is not equivalent to exclusively

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

2. Grounds for change of name

The following may be considered, among others, as proper or reasonable causes that may warrant the
grant of a petitioner for change of name; (1) when the name is ridiculous, tainted with dishonor, or is
extremely difficult to write or pronounce; (2) when the request for change is a consequence of a
change of status, such as when a natural child is acknowledged or legitimated; and (3) when the
change is necessary to avoid confusion (1 Tolentino 660, Civil Code of the Philippines, 1953 ed; Haw
Liong v. Republic). In the case at bar, to avoid confusion, the petition of name should be granted as
the petitioner has been using the name of Estrella S. Alfon since childhood.
Rura v. Lopena [GR L-69810-14, 19 June 1985]
Second Division, Abad Santos (p): 5 concur

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

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

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

1. “Previous” applies to date of conviction, not to date of commission of a crime

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