Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-8414

February 28, 1957

MANGHARAM B. HEMMANI, petitioner-appellant,

vs.
THE EXPORT CONTROL COMMITTEE, respondent-appellee.
De la Cruz, Fernandez & Mate for appellant.
Office of the Solicitor General Ambrosio Padilla and Assistant Solicitor General Jose G. Bautista for
appellee.
The Solicitor General has made a accurate exposition of the facts of the case. They may be summarized
as follows: On August 28, 1952, petitioner requested permission from the Export Control Committee,
created under section 2 of Republic Act No. 613 and composed of the Secretary of Agriculture and
Natural Resources as Chairman, the Secretary of National Defense and the Administrator of the
Economic Coordination, as Members, to ship to his Hudson Sedan, Model 1949, Motor No. 48149039,
valued at P4,500, to Osaka, Japan, on board the S. S. President Wilson, "to be used in connection with
his business thereat." The respondent Committee approved the request on the same day, on condition
that petitioner would file a bond equal to the value of the car, to guarantee the return of the same in the
Philippines within six months from the date of its shipment.
On August 29, 1952, petitioner posted with the Filipinas Compaia de Seguros a surety bond (Annex A) in
the sum of P4,500 in favor of the Republic of the Philippines (Bureau of Customs), guaranteeing that the
Hudson Sedan car would be re-exported back to the Philippines from Japan within six months from the
execution of the bond. Accordingly, petitioner took the car in question to Osaka, Japan, on August 29,
1952, but failed to bring it back to the Philippines as promised. Instead petitioner filed two requests for
extension of six months each to be followed to re-export the car back to the Philippines until March 1,
1954, alleging that he was still on a business tour and it would be impracticable to return the car on time.
Notwithstanding the two extensions given him by the respondent the car in question was not brought back
in the Philippines.
On February 24, 1954, Atty. Teotimo A. Roja, in behalf of the petitioner, requested the respondent to order
the cancellation of the surety bond of P4,500 that he and the Filipinas Compaia de Seguros (Bond No.
27914) had executed, alleging that it would be impracticable and expensive to return the car to Manila,
considering its dilapidated condition and utility in Japan, but the respondent denied said request, though
at its meeting held on February 24, 1954 it decided to reduce the liability under the bond to P2,250.00 for
the reason that this was the value that the car would have at the state it was then if it were brought back
in the Philippines, thus allowing a depreciation of 15 per cent each year.
On May 13, 1954, petitioner requested respondent for reconsideration of its resolution of February 24,
1954, alleging that: (1) the Committee had no jurisdiction to imposed said penalty; and (2) granting, for
the sake of argument that the Committee had jurisdiction to impose said penalty, the penalty imposed
was highly excessive and violative of the Constitutional prohibition against excessive fines". Again this

motion for reconsideration was denied by the respondent under date of June 30, 1954; hence the
institution of this petition in the Court of First Instance of Manila on July 6, 1954, which was answered by
the Solicitor General in due time. The case was then submitted on the stipulation embodying the facts
aforementioned, and the Court rendered decision on September 24, 1954. dismissing the petition for lack
of merit, with costs against the petitioner. From this decision the petitioner appealed to Us and in the
instance his counsel maintains that the lower court erred:
1. In not finding that appellant's car in question is personal effect and therefore not subject to
statutory or reglementary prohibition against exportation;
2. In not sustaining appellant's claim that the bringing out of his car in the instant case did not
constitute exportation;
3. In not finding that the respondent had acted without jurisdiction in requiring appellant to file a
bond and later ordering its forfeiture; and
4. In denying the petition for certiorari.
Section 3 of Republic Act No. 613, approved on May 11, 1951, authorizes the President "to control,
curtail, regulate and/or prohibit the exportation or re-exportation of materials, goods and things referred to
in Section 2 of the Act and to issue rules and regulations as would be necessary to carry out the
provisions thereof". Section 2 of said Act prescribes in turn "that all applicants for permit to export or reexport any of the articles mentioned in the preceeding section 1, should be filed before a Committee to be
composed of the Secretary of Agriculture and Natural Resources as Chairman, the Secretary of National
Defense and the Administrator of Economic Coordination as Members". Republic Act No. 613 further
provides the following:
SEC. 1. In order to promote economic rehabilitation and development and to safeguard national
security, it shall be unlawful to any person, association or corporation to export or re-export to any
point outside thePHILIPPINES MACHINERIES AND THEIR SPARE PARTS, scrap metals,
medicines, foodstuffs, abaca seedlings, gasoline, oil, lubricants and military equipment or
supplies suitable for military use without a permit from the President which may be issued in
accordance with the provisions of the next succeeding section.
In virtue of the power vested in him, the President issued on June 19, 1951, Executive Order No. 453,
series of that year (47 Off. Gaz. No. 6, p. 2793), section 2 whereof reads as follows:
SEC. 2. The exportation of all articles included in the list marked Annex A, hereto attached as an
integral part of this Order, is absolutely prohibited: Provided, however, That licenses issued or
authority granted prior to the effectivity of Republic Act No. 613, by the Interdepartmental
Committee from February 28, 1951, by the Civil Aeronautics Board or the Civil Aeronautics
Administration and by the Sugar Quota Office on nonferrous metals pursuant to the Cabinet
Resolution of November 21, 1950, are valid and subsisting.
(The articles pertinent to this case that are included in the list marked Annex A referred to above as
enumerated in Paragraph IV of said annex which will be quoted hereafter).

The President, however, amended this Executive Order by another, No. 482, issued on October 31, 1951
(47 Off. Gaz., No. 10, p. 5039), in the following manner:
SEC. 2. The exportation of all articles in the list marked Annex A, hereto attached as an integral
part of this Order, is absolutely prohibited; Provided, however, That in exceptionally meritorious
cases and where the Committee is fully satisfied that the overall economic and military
requirements of the country are not prejudiced, such exportation may be allowed subject to the
provisions of Section 4 of this Order, (which refers only to applications concerning articles
included in the list marked Annex C and not in Annex A).
Because of the amendment made by Executive Order No. 482, the Hudson Sedan automobile herein
involved was allowed by the Committee to be exported to Osaka, Japan, with the obligation on the part of
the plaintiff to report it back to the Philippines from Japan within the period granted to him to do so,
extensions included, which obligation he failed to fulfill. Naturally, he is in duty bound to abide by the
consequences of his failure and must pay the amount of the bond he posted, as ultimately reduced, or
P2,250. Plaintiff, however, contends that this car in question was his personal effect and, therefore, not
subject to statutory or reglementary prohibition against exportation. It seems, however, that plaintiff
confuses the term "personal effects" with "property of the person" or personal property". As pointed out by
the Solicitor General:
The word "personal" used with "effects" much restrict its meaning (Child vs. Orton, 183, A. 709,
710-119 N. J. Eq. 438), and certainly (that meaning, cannot be understanding without any
qualifying words includes only such tangible property as attends the person.
Among the articles the exportation of which is prohibited according to said Executive Order are:
IV. Imported Machinery (light and heavy), mechanical, electrical, agricultural, construction,
engineering, andtransportation equipment of all types, including surplus equipment, spare parts,
accessories, wires and other allied articles, except those already approved by the Bureau of
Customs or NICA or order Government agencies as well as licenses covered in section 2 herein.
It is undisputed that petitioner's car is covered with the term "transportation equipment of all
types" and not as "personal effects", as counsel would want to classify it. Petitioner's car was
admittedly brought by him to Osaka, Japan, "to be used in connection with his business" (p. 16,
Record on Appeal) , and that when he asked for extension of time to re-export the motor vehicle
back to the Philippines, his reason was that he was still on a business tour, (p. 17, Record on
Appeal).
If by personal effects of passengers in transit transportation equipment used in one's business
were included, then it would be a simple matter to defeat the intention of the law, that is, to
promote the economic and industrial development of the country. To seal any possible loophole,
the Executive Order made it clear that exportation of all articles included in the list is prohibited
irrespective of the use for which they were intended.
The cardinal rule in the interpretation of law is to ascertain and give effect to the legislative intent (Roldan
and Daza vs. Villaroman (1949), 69 Phil. 12), and the intention of the Legislature in enacting a law is part
of the law itself, and is to be followed and applied, where ascertainable, in construing apparently
conflicting provisions (Altaban vs. Masbate Consolidated Mining Co., et al. (1940) 69 Phil. 696). These

principles of statutory construction are more true in the case at bar because the wording of the law is too
plain and clear.
On the other hand, the Solicitor General further contends that contrary to the assertions of plaintiff's
counsel, the respondent is expressly authorized by the provisions of section 6 of said Executive Order No.
453 to require the petitioner to file a bond in this case to insure either the reaching of goods to their
intended destination or its return to the Philippines, and section 4 of Republic Act No. 613 provides that in
case of a violation of said Acts which regulates, controls and/or prohibits certain exports from the
Philippines, the materials intended for export in violation of said Act and the rules and regulations
thereunder, shall be confiscated by and forfeited to the Government. Consequently, if the petitioner
violated the provisions of said Executive Orders by not returning or re-exporting back to the Philippines
the automobile in question, and this property cannot be confiscated because it is beyond the jurisdiction
of this country, it would appeal to reason that plaintiff should pay the equivalent value of the automobile
which he placed beyond the reach of the Government to the Philippines, That is why he was required to
give the bond and should pay the Government for the automobile that it should not seized and forfeit.
But even assuming arguendo, that the respondent were not authorized to require the petitioner to file the
bond in question, nevertheless, the Republic of the Philippines being a political entity has an incident to its
sovereignty the capacity to enter into contracts and take bonds in cases appropriate to the just exercise of
its power through its instrumentalities or agencies whenever, as in the instant case, such contracts or
bonds are not prohibited by law, although the making of such contracts or the taking of such bonds may
not have been specifically prescribed by any pre-existing statute (Solicitor General's brief, p. 6-8).
Certainly petitioner could not have taken from the Philippines his automobile if he had not furnished the
bond required from him and which he voluntarily furnished. He had been enjoying the benefits which the
bond intended to secure and now he cannot come and allege that he is not bound by the terms of the
bond. The present case has a legal aspect similar to the one We solved in the case of Compaia General
de Tabacos de Filipinas and S. S. Co. of 1912& S. S. Co. Svandoorg (A. P. Moller, Maersk Line),
petitioner, vs. The Collector of Internal Revenue, respondent, G.R. No. L-9071, promulgated January 31,
1957. It appeared in that case:
That while the M/V Hulda Maersk, represented locally by Tabacalera, was moored alongside
Manila's Pier no. 9, its chief steward, Henry Anderson, took from its stores 30 cases of cigarettes
of foreign manufacture, which he sold to two persons in uniform for two thousand dollars
($2,000.00). With this help the cargo was surreptitiously unloaded and withdrawn from the
pier, import taxes unpaid. The Customs authorities somehow discovered the anomaly, and
promptly investigated. Anderson admitted the sale; Captain Jansen, the ship's master, swore that
the cigarettes belonged to the ship's stores and declared their willingness to pay the
corresponding duties upon presentation of the bill to their local agents, the Tabacalera. The latter
in turn, thru its Acting Manager of the Shipping Department Edward N. Bosch, who was present
during the investigation, signed the following guaranty:
The Commission of Customs
Manila
DEAR SIR:
We hereby confirm our agreement to pay immediately upon presentation of the
corresponding bills, all taxes due on 30 (Thirty) Cases Chesterfield, Lucky Strike and

Camel cigarettes, each case containing fifty cartoons of two hundred cigarettes each,
removed from the above vessel.
Accordingly, on March 5, 1952, upon receipt of the corresponding bill, Tabacalera paid the
amount of P6,613.05 representing specific taxes on the aforesaid cigarettes. Thereafter it
submitted a request for refund, which the Collector of Internal Revenue denied, and the Court of
Tax Appeals likewise denied.
In the cited case Tabacalera's demand for returned was made after the ship Hulda Maersk and the
persons involved in the attempted smuggle had already left the Philippines, a fact that the Bureau of
Customs would not have allowed to happen if the Tabacalera had not agreed to pay the taxes due upon
presentation of the bill, and We affirmed the decision of the Board of Tax Appeals rendered in the case.
Wherefore, on the strength of the foregoing considerations and finding no error in the decision appealed
from, We hereby affirmed the same, with costs against plaintiff. It is so ordered.
Paras, C.J., Bengzon, Padilla, Montemayor, Reyes, A., Bautista Angelo, Labrador, Concepcion, Reyes,
J.B.L. and Endencia, JJ., concur.

EN BANC
[G. R. No. 5013. March 11, 1909.]
JEREMIAH J. HARTY, Roman Catholic Archbishop of Manila, Plaintiff-Appellee, vs. THE
MUNICIPALITY OF VICTORIA, Province of Tarlac, Defendant-Appellant.
DECISION
TORRES, J.:
On January 17, 1908, the representative of Mgr. Jeremiah J. Harty, archbishop of the Roman Catholic
Church, as the legal administrator of the properties and rights of the Catholic Church within the
archbishopric of Manila, filed a written complaint in the Court of First Instance of Tarlac against the
municipality of Victoria, alleging that the parish of the said town had been and was then the owner of a
parcel of land within the said municipality, known as the plaza of the church of Victoria; that it had
acquired said parcel of land more than sixty years previously, and had continued to possess the same
ever since up to 1901, in which year the Defendantmunicipality unlawfully and forcibly seized the said
property, claiming to be entitled thereto and retaining it to the present day. For the purposes of the
complaint, a description of the metes and bounds of the land in question was set forth in the writing,
and Plaintiff prayed that, in view of what was therein set forth, judgment be entered holding that the said
land was the property of the parish of Victoria, of the Roman Catholic Apostolic Church, and that
the Defendant be ordered to vacate the same and to pay the costs of the action.
The Defendant municipality answered the complaint through its attorney and offered a general denial of
all the facts stated therein, especially of those numbered 4, 5, 6, and 7; in special defense it alleged that
the plaza described in No. 4 of the complaint was founded when the sitio denominated Canarum, a barrio
of the town of Tarlac, was converted into a civil town in 1855; that the parish of Tarlac was established
many years after the civil town, and that therefore, it neither had then, nor has now any title to the plaza
claimed, and that the complaint injured the Defendant, and for this reason it prayed that judgment be
entered absolving the Defendant of the complaint with costs and damages against the Plaintiff.
Evidence was adduced by both parties, and the documents exhibited, to one of which
thePlaintiff objected, were made of record; the trial court rendered judgment on the 15th of June, 1908,

holding that the parish of Victoria of the Roman Catholic Apostolic Church, had a better right to the
possession of the land described in the complaint, and sentenced the Defendantto vacate the same and
to pay the costs. To said judgment the representative of theDefendants excepted and moved for a new
trial on the ground that it was contrary to the weight of the evidence, and he notified the court that, if his
motion were overruled, he would appeal to the Supreme Court. The motion for a new trial was overruled;
the Defendantexcepted, and presented the corresponding bill of exceptions which, after receipt of a copy
had been acknowledged by the adverse party, was approved. On the 1st of September last,
the Appellant was ordered to furnish bond in the sum of P1,000 to insure the fulfillment of the judgment in
the event that it should be totally or partially affirmed. To said order the Defendant excepted, but furnished
the bond as directed by the court.
In the view of the nature of the action brought by the Plaintiff against the municipality of Victoria, Province
of Tarlac, the question that has arisen between the contending parties consists only in determining who is
the owner and proprietor of the parcel of land that surrounds the parish church of the said town, and
which is called the public plaza of the same.
Article 339 of the Civil Code reads: chanrobles virtualawlibrary
Property of public ownership is: chanrobles virtualawlibrary
1.
That destined to the public use, such as roads, canals, rivers, torrents, ports, and
bridges constructed by the State, and banks, shores, roadsteads, and that of a similar character.
Article 344 of said code also reads: chanrobles virtualawlibrary
Property for public use in provinces and in towns comprises the provincial and town roads, the
squares, streets, fountains, and public waters, the promenades, and public works of general
service supported by the said towns or provinces.
From the evidence presented by both parties it appears that the town of Victoria, which was formerly only
a barrio of the town of Tarlac and known as Canarum, was converted into a town in 1855, and named
Victoria; to this end they must have laid out the streets and the plaza of the town, in the center of which
were situated the church and parish house from the commencement, and at the expiration of about twelve
years the parish of said town was constituted and the priest who was to perform the office of curate was
appointed; that from the very beginning, the large tract of land that surrounds the church and the parish
house was known as a public plaza, destined to the use of all the residents of the recently founded town;
public performances and religious processions were held thereon without hindrance either on the part of
the local authorities or of the curate of said town.
It must be assumed that the principal residents of the old barrio, being interested in the conversion of the
barrio into a civil town, arranged in such a way that the barrio, as the center of the future town which was
subsequently called Victoria, should have streets and a public plaza with its church and parish house, and
also a tribunal or building destined for the use of the municipality and the local official at the time called
the gobernadorcillo and later on capitan municipal, as has occurred in the foundation of all the towns in
these Islands, under the old administrative laws.
It may be true that the father of the witness Casimiro Taedo, who owned the space of land where the
church and parish house were erected, had voluntarily donated it to the Catholic Church, the only known
at the time, but proper proof is lacking that the donation affirmed by the said Tanedo comprehended the
whole of the large tract which at the present time constitutes the plaza of the town.
It was a custom observed by all the towns established administratively in these Islands under the old
Laws of the Indies, that on their creation, a certain amount of land was always reserved for plazas,
commons, and special and communal property, and as it is unquestionable that the said large space of
land was left vacant in the center of the town of Victoria when it was constituted as a civil town, more than
twelve years prior to the appointment of a permanent curate therein, there are good grounds to suppose
that the late Vicente Tanedo donated the land now occupied by the church and parish house in said
municipality for religious purposes, or to the church, but not to the parish curate, because at the time
there was no curate at the new town of Victoria.

Even though all the remaining space of land which now forms the great plaza of the town of Victoria had
been owned by the said Tanedo, it must be presumed that he waived his right thereto for the benefit of the
townspeople, since from the creation or establishment of the town, down to the present day, all the
residents, including the curate of said town, have enjoyed the free use of said plaza; it has not been
satisfactorily shown that the municipality or the principales of the town of Victoria had donated the whole
of said land to the curate of Victoria or to the Catholic Church, as alleged, nor could it have been so
donated, it being a public plaza destined to public use and was not private ownership, or patrimony of the
town of Victoria, or of the Province of Tarlac.
It should be noted that, among other things, plazas destined to the public use are not subject to
prescription. (Art. 1936, Civil Code. ) cralaw
That both the curates and the gobernadorcillos of the said town procured fruit trees and plants to be set
out in the plaza, does not constitute an act of private ownership, but evidences the public use thereof, or
perhaps the intention to improve the and embellish the said plaza for the benefit of the townspeople.
Certain it is that the Plaintiff has not proven that the Catholic Church or the parish of Victoria was the
owner or proprietor of the said extensive piece of land which now forms the public plaza of said town, nor
that it was in possession thereof under the form and conditions required by law, inasmuch as it has been
fully proven that said plaza has been used without let or hindrance by the public and the residents of the
town of Victoria ever since its creation. For the above reasons it is our opinion that the judgment appealed
from should be reversed, and that it should be held, as we do hereby hold, that the whole of the land not
occupied by the church of the town of Victoria and its parish house, is a public plaza of the said town, of
public use, and that in consequence thereof, the Defendant is absolved of the complaint without any
special ruling as to the costs of both instances.
Arellano, C.J., Mapa, Johnson, Carson and Willard, JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-9865 December 24, 1915

VERGO D. TUFEXIS, plaintiff-appellant,

vs.
FRANCISCO OLAGUERA and THE MUNICIPAL COUNCIL OF GUINOBATAN, represented by its
president, Agapito Paulate, defendants-appellees.
Rafael de la Sierra for appellant.
Attorney-General Avancea for appellee Municipal Council of Guinobatan.
No appearance for the other appellee.

TORRES, J.:
Counsel for plaintiff, in his written petition of May 13, 1913, prayed the Court of First Instance of Albay to
declare that his client was entitled to the possession and use of the land referred to in the complaint in
conformity with the terms of the Government concession (Exhibit A), of which he claimed to be the sole
and lawful owner; that the defendants be ordered to remove from the said land all the stores, sheds,
billiard tables, and other obstructions thereon, so that plaintiff might reconstruct the public market building
on the said land in accordance with the provisions of the said concession, and that they be ordered to pay
jointly and severally to the plaintiff, as damages, the sum of P250 per month from March 1, 1912, until the
date on which the land be vacated, and to pay the legal costs and expenses of the suit.
After the complaint had been answered by counsel for the defendant Francisco Olaguera, who prayed
that his client be absolved therefrom, with the costs against the plaintiff, the provincial fiscal, in the name
and representation of the municipality of Guinobatan, demurred on the ground that plaintiff lacked the
personality to institute the action and further alleged that the complaint did not set forth sufficient facts to
constitute a cause of action.1awphil.net
By an order of August 25, 1913, the court sustained the demurrer filed by the defendant municipality of
Guinobatan, allowed plaintiff ten days in which to amend his complaint, and notified him that unless he did
so within that period the action would be dismissed.
Counsel for plaintiff, by a writing of the 27th of the said month, set forth: That he objected to the above
ruling as he believed it erroneous and contrary to law; that he did not desire to amend his complaint,
wherefore, in accordance with the provisions of section 101 of the Code of Civil Procedure, the court
should render such judgment in the case as the law might warrant, and his exception to the said ruling
should be entered on the record. By an order of September 1, 1913, the court, overruling the motion
made by the defendant Olaguera, dismissed the complaint filed by the plaintiff, Vergo D. Tufexis, against
the municipal council of Guinobatan on the ground that plaintiff had not amended his complaint. Plaintiff's
counsel, when notified of this ruling, excepted thereto and moved for a rehearing and a new trial. This
motion was overruled, whereupon the plaintiff excepted and filed the proper bill of exceptions.
In the complaint filed by counsel for Vergo D. Tufexis, it was alleged that on September 30, 1911, plaintiff
acquired at a public sale held in execution of a judgment rendered against Ricardo Pardo y Pujol, a piece
of property situated in the municipality of Guinobatan, consisting of a frame building of strong materials
with a galvanized-iron roof, erected on a parcel of land belonging to that municipality and intended for a
public market; that plaintiff also acquired at the sale all the right, interest, title, and participation in the said
property that appertained or might appertain to Pardo y Pujol; that the said building was constructed by

virtue of a concession granted by the former Spanish government to Ricardo Pardo y Cabaas, father of
the judgment debtor, who, by a public instrument of July 31, 1912, renounced his right to redeem the said
property and conveyed it to plaintiff, together with all his rights therein, the instrument of grant, Exhibit A,
being attached to the complaint as a part thereof; that on January 2, 1912, the said building was totally
destroyed by an accidental fire; that subsequent to the date just mentioned and for several months
thereafter the municipal council of Guinobatan carried on negotiations with plaintiff for the purchase of his
rights in the said concession; that these negotiations could not be brought to a conclusion because the
municipal council had acted therein deceitfully, fraudulently, and in bad faith and for the sole purpose of
beguiling, deceiving, and prejudicing plaintiff in order to prevent him from exercising his right to
reconstruct the burned market building and utilize it in accordance with the terms of the said concession;
that the defendant municipal council, without plaintiff's consent and in connivance with the other
defendant, Francisco Olaguera, had authorized the latter unlawfully to take possession of all the land from
March 1, 1912, in violation of plaintiff's rights; that the said Olaguera occupied the same with booths or
stores for the sale of groceries and other merchandise, for billiard tables, and other analogous uses and
derived unlawful gain from the revenues and rents produced by the said buildings; that plaintiff was
entitled to the possession of the said land in accordance with the concession, which was in full force and
effect and belonged to plaintiff; that plaintiff proposed to construct another public market building on the
same land, but that the defendants had prevented him from using the land and reconstructing thereon the
said public market building, and refused to recognize plaintiff's right and to vacate the land that had been
occupied by the burned edifice.
The provincial fiscal alleged as a ground for the demurrer that in no part of the instrument of concession
did it appear that the privilege granted to Ricardo Pardo y Cabaas had likewise been granted to his
successors or assignees, and that therefore such rights and actions as might have appertained to the
assignee, Pardo y Cabaas, could not be conveyed to nor could they be acquired by any other person;
that it was alleged in the complaint that the building was completely destroyed by fire on January 2, 1912,
and that if plaintiff's right to the possession of the land was conditioned by the existence thereon of the
said market building, such right had terminated by the disappearance of the building, inasmuch as
plaintiff's right of action for the possession of the land was a corollary of the existence or nonexistence of
the market building, and upon the disappearance of the latter the eland had reverted to the control of its
owner; that pursuant to the terms of the said concession, the land belonging to the municipality was
granted for the purpose of constructing thereon a market, and as this market had disappeared plaintiff
would need a new concession, if it could be obtained, in order to be entitled to the possession of the land
and to construct a new building; that by plaintiff's acquiring the right, title and interest of Ricardo Pardo y
Pujol in the land he could not be understood to have also acquired such right and interest in the building
intended for a public market, for the purchase of the building refers only to the edifice itself and it never
could be understood that plaintiff acquired any right in the concession, which was never sold to him, as
the complaint contains no allegation whatever that he purchased or acquired such right; that a personal
privilege like the said concession is only temporary and is extinguished at the death of the grantee, unless
otherwise provided in the grant; and that, from the lack of an allegation in the complaint that plaintiff
legally purchased or acquired the right in the said concession, it was evident that the complaint did not
allege sufficient facts to constitute a cause of action and was fatally defective.
The question presented in the case at bar consists of whether a building of strong materials, erected by
the said debtor's father, Ricardo Pardo y Cabaas, on land belonging to the municipality of Guinobatan
and intended for a public market, by virtue of a concession granted on August 4, 1884, under the
conditions therein imposed upon the grantee, could be attached and sold for the payment of a certain
debt owed by Ricardo Pardo y Pujol to a third person who had obtained a final judgment.

In deciding this question it is indispensable to determine what rights were acquired by Pardo y Pujol's
father by virtue of the said concession granted to him by the Spanish Government, in the building erected
by him on a parcel of land belonging to the municipality of Guinobatan. The concession referred to
contains, among other provisions, the following:itc-a1f
ARTICLE 1. There is hereby granted to Mr. Ricardo Pardo y Cabaas the parcel of land in the
pueblo of Guinobatan, a prolongation of another parcel belonging to him, situated between the
store and house of the Chinaman Valentin Garcia and that of Mr. Roco, following the line of Calle
Real or Calzada de Albay and that of Calle del Carmen, up to and as far as the square that is to
be laid out in the said pueblo.
ART. 2. On the said land the petitioner shall construct a public market building, with a galvanizediron roof, in accordance with the plan submitted to this office on the 13th of last May and which
was approved by his Excellency the Governor-General in conformity with the changes
recommended by the advisory board of the consulting board of public works; and these changes
are those hereinafter specified.
ART. 3. The said Mr. Pardo is granted the right to enjoy the revenue derived from the floor space
of the market for the period of forty years, since the revenue from such floor space appertains to
the grantee of the said service. By floor space is meant the right to shelter or retail merchandise
in the market belonging to the grantee.
ART. 4. On the expiration of the said period both the land aforementioned and the building
thereon constructed shall be the property of the Government and the building shall be delivered
to it in good condition.
ART. 5. It shall be obligatory for every vendor to sell his goods in the said market, which shall be
the only one in the said pueblo.
ART. 7. The said authority shall put Mr. Pardo in possession of the land affected by this
concession, and the proper proceedings in connection therewith shall be had in the presence of
the chief engineer of public works of the said district and the headmen of the pueblo.
ART. 8. Mr. Pardo shall inform this office of the date of the commencement of the work of
construction, and the work shall be inspected by the public works officials residing in Albay; the
building when completed shall be examined and accepted by the chief engineer of the district of
Nueva Caceres or by the deputy to whom the latter may delegate this duty: all with the knowledge
of the office of the inspector of public works.
The land on which the building was erected and which is referred to in the foregoing articles, contained in
the franchise granted by the Government of the former sovereignty, belongs to the municipality of
Guinobatan. Although the building was constructed at the expense and with the money of the grantee,
Ricardo Pardo y Cabaas, it is, nevertheless, the property of the state or of the said municipality, and was
temporarily transferred to the grantee, Pardo y Cabaas, in order that he might enjoy the usufruct of its
floor space for forty years, but on the termination of this period the said right of usufruct was to cease and
the building was to belong finally and absolutely to the state or the municipality in representation thereof.

For these reasons, then, there is no question that the building and the land on which it was erected, since
they did not belong to the grantee, Pardo y Cabaas, nor do they belong to his son and heir, Ricardo
Pardo y Pujol, could not be attached or sold for the payment of a debt contracted by the latter.
The concession granted by the former Spanish Government is personal and transferable only by
inheritance, and in no manner could it be conveyed as a special personal privilege to another and a third
person unless were an hereditary successor of the grantee, Pardo y Cabaas, without knowledge and
consent of the administrative authorities under whose control the special right of usufruct in the floor
space of the said market building was enjoyed and exercised.
Even though it is unquestionable that the creditor has a right to collect the money due him, out of his
debtor's property, yet when among such property is included the right of usufruct in a public-service
building and this right is closely related to a service of a public character, the right that lies in behalf of the
creditor for the collection of a debt from the person who enjoys the said special privilege of right of
usufruct in the floor space of a building intended for a public market is not absolute and may be exercised
only through the action of a court of justice with respect to the profits or revenues obtained under the
special right of usufruct granted to the debtor.
Ricardo Pardo y Pujol, as the successor and heir of the grantee, Pardo y Cabaas, is bound to pay his
debts and his property can be attached on petition of his creditors. However, his personal privilege of
usufruct in the floor space of the public market building of Guinobatan cannot be attached like any
ordinary right, because that would mean that a person who has contracted with the state or with the
Governmental authorities to furnish a service of a public character would be substituted, for another
person who took no part in the contract, and that the regular course of a public service would be disturbed
by the more or less legal action of the creditors of a grantee, to the prejudice of the state and the public
interests.
It is indeed true that the building, which for many years served as a public market in the pueblo of
Guinobatan, was erected out of the private funds of the grantee, Pardo y Cabaas, and at first sight it
seems natural that the latter, who paid the cost of the construction of the building, should be its owner.
However, judging from the agreement between him and the Government authorities, he was granted the
right to usufruct in the floor space of the said building in order that, during the period of forty years, he
might reimburse himself for and collect the value of the building constructed by him; and it must be
believed that Pardo y Cabaas, before executing the contract with the Government for the purpose of
obtaining the right of usufruct granted to him and before accepting the contract, thought over its
conditions deliberately and maturely and felt sure that he would profit thereby, that is, that he would
reimburse himself for the value of the building he erected, and obtain interest on the investment and other
advantages by enjoying the usufruct for the space of forty long years, as in fact even after his death this
right continued to be enjoyed by his son, Ricardo Pardo y Pujol. Therefore, the said privilege conferred on
the grantee by the Spanish Government on August 4, 1884, was neither onerous nor prejudicial to him or
his heir, but on the contrary was beneficial to them.
So, if neither the land nor the building in question belongs to Pardo y Pujol, it is evident that they could not
be attached or sold at public auction to satisfy his debt and, consequently, the attachment and sale of the
said Government property executed on petition of the creditor of the said Pardo y Pujol are notoriously
illegal, null and void, and the acquisition of the property by plaintiff confers upon him no right whatever
based on the said concession.

In the decision in the case of Lopez vs. Alvarez (9 Phil. Rep., 28) the principle was asserted that:
In attachments of all kinds it is an essential condition that the thing which is attached shall be the property
of the debtor, and from no provision of the Mortgage Law can any conclusion be drawn which shall be
contrary to this principle.
This same principle was set up in the decision of the case of Alvaran vs. Marquez (11 Phil. Rep., 263).
It having been demonstrated by the foregoing reasons that the building constructed on land of the
municipality of Guinobatan for a public market could not be attached and sold as the result of a debt
contracted by Ricardo Pardo y Pujol in favor of a third person, we shall now proceed to examine whether
an attachment would lie of the special right, granted by the former Spanish Government to the said
debtor's father, of usufruct in the floor space of the said market and right to collect the revenues therefrom
for the period of forty years, counted from the date of the granting of the said right.
Without the consent of the proper administrative official, a grantee, or one charged with conducting a
public service such as a market of the municipality of Guinobatan, cannot be permitted to be substituted
by any other person, though this latter be a creditor of the usufructuary grantee. Hence, we hold that the
attachment of the right of usufruct in the said building and of collecting the revenue obtained from the floor
space of the said public market of Guinobatan, was illegal, because, were this right susceptible of
attachment, a third person, as a creditor or a purchaser, might exercise such right, notwithstanding his
personal status, instead of the grantee contractor. This theory does not bar the creditor from collecting the
money owed him by the grantee, inasmuch as he has the right to petition the courts to allow him through
proper legal proceedings to collect his money out of the revenues produced by the usufruct conferred by
the Government on the grantee of the said service.
The concession obtained by Ricardo Pardo y Pujol's father on August 4, 1884, is a true sovereignty and
the grantee, Pardo y Cabaas, and therefore the stipulations made by and between the contracting
parties, the obligation to which that contract may have given rise, and the consequences that may have
been entailed by the contract, all come within the scope of the civil law which guarantees the rights of the
contracting parties.
Although in our opinion the said concession is somewhat of the nature of a franchise, yet we do not think
that the provisions of sections 56 to 61 of Act No. 1459 are applicable to the case at bar, for these
sections refer to a franchise granted to a corporation, while the concession given by the former Spanish
Government was granted to a private party and not to a corporation or judicial entity. Therefore, though
under the said Act a franchise is subject to attachment, the Act contains no express provision whatever
which authorizes the attachment and sale of a right or franchise especially granted to a private party
under the conditions in which the concession in question was granted. The substitution of a third person
instead of the one who obtained such an administrative concession must be explicitly authorized by the
proper official of the administrative branch of the Government in order that the substitute may exercise the
right so granted.
In the case of Ricardo y Pujol, the grantee of the usufruct on the floor space in the said market building in
Guinobatan, his creditor, in order to obtain the payment of his credit, could have applied to the courts for
an attachment of the revenues or proceeds collected by his said debtor by virtue of the said concession;
but it was in no wise proper to attach and sell the right granted by the public administration to operate and
enjoy the usufruct of the floor space of the said public market.

Although there is no similarity between the management of a public market and that of a railroad
company, yet for the reason that the operation of the one as well as the other is of public interest, when a
creditor of such a company sues to collect a debt it would be improper to attach the stationary equipment
and rolling stock of the railroad only the gross receipts of the business over and above the amount
required for its operation could be touched. This same legal principle holds in the case where the grantee
of a market is a debtor and his property is attached on petition of his creditor. The receipts of the market
may be attached, but not the right to operate and conduct the service, which is of a public character.
In fact, article 1448 of the Ley de Enjuiciamiento Civil, cited in this decision, not as a law now in force, but
for the purpose of setting out a principle of law, prohibits the levy of attachments on railroads opened to
public service, and on the stations, stores, shops, lands, works and buildings necessary for their
operation, or on the locomotives, rails and other material intended for the operation of the line. When
execution is levied on such railroad companies, the proceedings are governed by the provisions of the
Law of November 12, 1869, extended by a royal order of August 3, 1886, to the overseas provinces. This
law prescribes among other things that attachments may be levied and executed only on the gross
receipts remaining after the necessary operating expenses have been deducted.
In harmony with this legal provision, the supreme court of the State of Nebraska, in which State there is
no law whatever that authorizes the attachment and sale of a bridge belonging to a corporation, in the
case of the Overton Bridge co. vs. Means (33 Neb., 857) laid down the principle that such a bridge and
the rights of the corporation therein could not be sold to satisfy a judgment against the corporation for the
reason that:
The property of corporations which are closed as public agencies, such as railroad and bridge
companies, which is essential to the exercise of their corporate franchise, and the discharge of
the duties they have assumed toward the general public, cannot, without statutory authority, be
sold to satisfy a common law judgment.
It cites decisions of several states, and also, in the decision referred to, cited Morawetz on Private
Corporations, section 1125, and held that after attachment of the property not necessary to enable the
corporation to perform its duties to the public, the only remedy remaining to a judgment creditor was to
obtain the appointment of a receiver and a sequestration of the company's earnings.
The supreme court of Alabama, in deciding a similar case (Gardner vs. Mobile & Northwestern R.R. Co.,
102 Ala., 635, 645), affirmed the same principle and said:
The only remedy of a judgment creditor is to obtain the appointment of a receiver and the
sequestration of its income or earnings.
It is to be noted that section 56 of Act No. 1459, which permits the sale under execution of a corporation's
franchise, is in no wise applicable to the case at bar, for the reason that, since this Act was promulgated
on March 1, 1906, it could not and cannot affect the laws, decrees, and orders of the Spanish government
in conformity with which the administrative concession, Exhibit A, was granted to Pardo y Cabaas.
The operation of a railroad is of public interest, and concerns both the public and the state, even though
the superintendent and management thereof be conducted by a private company. Therefore, the property
of a railroad, either its rolling stock or permanent equipment, is not subject to attachment and sale, and

the rights of the creditors of the operating company may be exercised for the collection of their credit only
of the gross receipts after the operation of the railroad is insured from its own income.
This decision is based on the provisions of the aforecited law and the premise that the usufruct of the floor
space of the public market of Guinobatan, granted to Ricardo Pardo y Pujol's father was not subject to
attachment on account of its being of a public character, but still the latter's creditor could have applied for
a writ of execution and laid an attachment on the proceeds obtained from the operation of the market,
which proceeds or income could have been collected by a receiver and intervenor.
This, however, was not done, but on the creditor's petition the public market building, which was not his
debtor's property, together with all the right, interest, title and participation which the latter had or might
have had therein, was attached and sold; and as plaintiff was unable to acquire any right or title in such
property illegally sold and illegally acquired by him at public auction or in the usufruct of the floor space of
the building, it is unquestionable that he lacks the personality to claim possession of the land that belongs
to the municipality or the enjoyment and exercise of the right conferred by the aforesaid administrative
concession, which was and is inalienable on account of its being a personal right. For the same reason,
plaintiff has no right to reconstruct the burned building on the land where it formerly stood.
The only right to which the creditor was entitled was to petition for the attachment of the income and
proceeds obtained from the use of the floor space of the market; but he did not avail himself of this right,
nor were the receipts therefrom attached, nor were they adjudicated either to the creditor or to the plaintiff
Tufexis. Therefore, the order of dismissal appealed is in accordance with law and the merits of the case,
and likewise the errors assigned thereto have been duly refuted by the reasons set forth herein.
For the foregoing considerations, we hereby affirm the said order of dismissal, with the costs against the
appellant. So ordered.
Arellano, C.J., Moreland, and Araullo, JJ., concur.
Johnson, J., concurs in the result.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-24950

March 25, 1926

VIUDA DE TAN TOCO, plaintiff-appellant,

vs.
THE MUNICIPAL COUNCIL OF ILOILO, defendant-appellee.
Arroyo & Evangelista for appellant.
Provincial Fiscal Borromeo Veloso for appelle.
VILLAMOR, J.:
It appears from the record that the widow of Tan Toco had sued the municipal council of Iloilo for the
amount of P42,966.40, being the purchase price of two strips of land, one on Calle J. M. Basa consisting
of 592 square meters, and the other on Calle Aldiguer consisting of 59 square meters, which the
municipality of Iloilo had appropriated for widening said street. The Court of First Instance of Iloilo
sentenced the said municipality to pay the plaintiff the amount so claimed, plus the interest, and the said
judgment was on appeal affirmed by this court.1
On account of lack of funds the municipality of Iloilo was unable to pay the said judgment, wherefore
plaintiff had a writ of execution issue against the property of the said municipality, by virtue of which the
sheriff attached two auto trucks used for street sprinkling, one police patrol automobile, the police stations
on Mabini street, and in Molo and Mandurriao and the concrete structures, with the corresponding lots,
used as markets by Iloilo, Molo, and Mandurriao.
After notice of the sale of said property had been made, and a few days before the sale, the provincial
fiscal of Iloilo filed a motion which the Court of First Instance praying that the attachment on the said
property be dissolved, that the said attachment be declared null and void as being illegal and violative of
the rights of the defendant municipality.
Plaintiffs counsel objected o the fiscal's motion but the court, by order of August 12, 1925, declared the
attachment levied upon the aforementioned property of the defendant municipality null and void, thereby
dissolving the said attachment.
From this order the plaintiff has appealed by bill of exceptions. The fundamental question raised by
appellant in her four assignments of error is whether or not the property levied upon is exempt from
execution.
The municipal law, section 2165 of the Administrative Code, provides that:
Municipalities are political bodies corporate, and as such are endowed with the faculties of
municipal corporations, to be exercised by and through their respective municipal government in
conformity with law.

It shall be competent for them, in their proper corporate name, to sue and be sued, to contract
and be contracted with, to acquire and hold real and personal property for municipal purposes,
and generally to exercise the powers hereinafter specified or otherwise conferred upon them by
law.
For the purposes of the matter here in question, the Administrative Code does not specify the kind of
property that a municipality may acquire. However, article 343 of the Civil Code divides the property of
provinces and towns (municipalities) into property for public use and patrimonial property. According to
article 344 of the same Code, provincial roads and foot-path, squares, streets, fountains and public
waters, drives and public improvements of general benefit built at the expense of the said towns or
provinces, are property for public use.
All other property possessed by the said towns and provinces is patrimonial and shall be subject to the
provisions of the Civil Code except as provided by special laws.
Commenting upon article 344, Mr. Manresa says that "In accordance with administrative legislation"
(Spanish) we must distinguish, as to the patrimonial property of the towns, "between that a common
benefit and that which is private property of the town. The first differs from property for public use in that
generally its enjoyment is less, as it is limited to neighbors or to a group or class thereof; and,
furthermore, such use, more or less general, is not intrinsic with this kind of property, for by its very nature
it may be enjoyed as though it were private property. The third group, that is, private property, is used in
the name of the town or province by the entities representing it and, like and private property, giving a
source of revenue."
Such distinction, however, is of little practical importance in this jurisdiction in view of the different
principles underlying the functions of a municipality under the American rule. Notwithstanding this, we
believe that the principle governing property of the public domain of the State is applicable to property for
public use of the municipalities as said municipal is similar in character. The principle is that the property
for public use of the State is not within the commerce of man and, consequently, is inalienable and not
subject to prescription. Likewise, property for public of the municipality is not within the commerce of man
so long as it is used by the public and, consequently, said property is also inalienable.
The American Law is more explicit about this matter as expounded by Mcquilin in Municipal Corporations,
volume 3, paragraph 1160, where he says that:
States statutes often provide the court houses, jails and other buildings owned by municipalities
and the lots on which they stand shall be exempt from attachment and execution. But
independent of express statutory exemption, as a general proposition, property, real and
personal, held by municipal corporations, in trust for the benefit of their inhabitants, and used for
public purposes, is exempt.
For example, public buildings, school houses, streets, squares, parks, wharves, engines and
engine houses, and the like, are not subject to execution. So city waterworks, and a stock of
liquors carried in a town dispensary, are exempt. The reason for the exemption is obvious.
Municipal corporations are created for public purposes and for the good of the citizens in their
aggregate or public capacity. That they may properly discharge such public functions corporate
property and revenues are essential, and to deny them these means the very purpose of their
creation would be materially impeded, and in some instances practically destroy it. Respecting

this subject the Supreme Court of Louisiana remarked: "On the first view of this question there is
something very repugnant to the moral sense in the idea that a municipal corporation should
contract debts, and that, having no resources but the taxes which are due to it, these should not
be subjected by legal process to the satisfaction of its creditors. This consideration, deduced from
the principles of moral equity has only given way to the more enlarged contemplation of the great
and paramount interests of public order and the principles of government."
It is generally held that property owned by a municipality, where not used for a public purpose but
for quasi private purposes, is subject to execution on a judgment against the municipality, and
may be sold. This rule applies to shares of stock owned by a municipal corporation, and the like.
But the mere fact that corporate property held for public uses is being temporarily used for private
purposes does not make it subject execution.
If municipal property exempt from execution is destroyed, the insurance money stands in lieu
thereof and is also exempt.
The members or inhabitants of a municipal corporation proper are not personally liable for the
debts of the municipality, except that in the New England States the individual liability of the
inhabitant is generally maintained.
In Corpus Juris, vol 23, page 355, the following is found:
Where property of a municipal or other public corporation is sough to be subjected to execution to
satisfy judgments recovered against such corporation, the question as to whether such property
is leviable or not is to be determined by the usage and purposes for which it is held. The rule is
that property held for public uses, such as public buildings, streets, squares parks, promenades,
wharves, landing places fire engines, hose and hose carriages, engine houses, public markets,
hospitals, cemeteries, and generally everything held for governmental purposes, is not subject to
levy and sale under execution against such corporation. The rule also applies to funds in the
hands of a public officer. Likewise it has been held that taxes due to a municipal corporation or
country cannot be seized under execution by a creditor of such corporation. But where a
municipal corporation or country owns in its proprietary, as distinguished from its public or
governmental capacity, property not useful or used for a public purpose but for quasi private
purposes, the general rule is that such property may be seized and sold under execution against
the corporation, precisely as similar property of individuals is seized and sold. But property held
for public purposes is not subject to execution merely because it is temporarily used for private
purposes, although if the public use is wholly abandoned it becomes subject to execution.
Whether or not property held as public property is necessary for the public use is a political,
rather than a judicial question.
In the case of City of New Orleans vs. Louisiana Construction Co., Ltd. (140 U. S., 654; 35 Law. ed., 556),
it was held that a wharf for unloading sugar and molasses, open to the public, was property for the public
use of the City of New Orleans and was not subject to attachment for the payment of the debts of the said
city.
In that case it was proven that the said wharf was a parcel of land adjacent to the Mississippi River where
all shipments of sugar and molasses taken to New Orleans were unloaded.

That city leased the said wharf to the Louisiana Construction Company, Ltd., in order that it might erect
warehouses so that the merchandise upon discharge might not be spoiled by the elements. The said
company was given the privilege of charging certain fees for storing merchandise in the said warehouses
and the public in general had the right to unload sugar and molasses there by paying the required fees,
10 per cent of which was turned over to the city treasury.
The United States Supreme Court on an appeal held that the wharf was public property, that it never
ceased to be such in order to become private property of the city; wherefore the company could not levy
execution upon the wharf in order to collect the amount of the judgment rendered in favor thereof.
In the case of Klein vs. City of New Orleans (98 U. S., 149; 25 Law. ed., 430), the Supreme Court of the
United States that a public wharf on the banks of the Mississippi River was public property and not
subject to execution for the payment of a debt of the City of New Orleans where said wharf was located.
In this case a parcel of land adjacent to the Mississippi River, which formerly was the shore of the river
and which later enlarged itself by accession, was converted into a wharf by the city for public use, who
charged a certain fee for its use.
It was held that the land was public property as necessary as a public street and was not subject to
execution on account of the debts of the city. It was further held that the fees collected where also exempt
from execution because they were a part of the income of the city.
In the case of Tufexis vs. Olaguera and Municipal Council of Guinobatan (32 Phil., 654), the question
raised was whether for the payment of a debt to a third person by the concessionaire of a public market,
the said public market could be attached and sold at public auction. The Supreme Court held that:
Even though a creditor is unquestionably entitled to recover out of his debtor's property, yet when
among such property there is included the special right granted by the Government of usufruct in
a building intended for a public service, and when this privilege is closely related to a service of a
public character, such right of the creditor to the collection of a debt owed him by the debtor who
enjoys the said special privilege of usufruct in a public market is not absolute and may be
exercised only through the action of court of justice with respect to the profits or revenue obtained
under the special right of usufruct enjoyed by debtor.
The special concession of the right of usufruct in a public market cannot be attached like any
ordinary right, because that would be to permit a person who has contracted with the state or with
the administrative officials thereof to conduct and manage a service of a public character, to be
substituted, without the knowledge and consent of the administrative authorities, by one who took
no part in the contract, thus giving rise to the possibility of the regular course of a public service
being disturbed by the more or less legal action of a grantee, to the prejudice of the state and the
public interests.
The privilege or franchise granted to a private person to enjoy the usufruct of a public market
cannot lawfully be attached and sold, and a creditor of such person can recover his debt only out
of the income or revenue obtained by the debtor from the enjoyment or usufruct of the said
privilege, in the same manner that the rights of such creditors of a railroad company can be
exercised and their credit collected only out of the gross receipts remaining after deduction has

been made therefrom of the operating expenses of the road. (Law of November 12, 1896,
extended to the overseas provinces by the royal order of August 3, 1886.)
For the reasons contained in the authorities above quoted we believe that this court would have reached
the same conclusion if the debtor had been municipality of Guinobatan and the public market had been
levied upon by virtue of the execution.
It is evident that the movable and immovable property of a municipality, necessary for governmental
purpose, may not be attached and sold for the payment of a judgment against the municipality. The
supreme reason for this rule is the character of the public use to which such kind of property is devoted.
The necessity for government service justifies that the property of public of the municipality be exempt
from execution just as it is necessary to exempt certain property of private individuals in accordance with
section 452 of the Code of Civil Procedure.
Even the municipal income, according to the above quoted authorities, is exempt from levy and execution.
In volume 1, page 467, Municipal Corporations by Dillon we find that:
Municipal corporations are instituted by the supreme authority of a state for the public good. They
exercise, by delegation from the legislature, a portion of the sovereign power. The main object of
their creation is to act as administrative agencies for the state, and to provide for the police and
local government of certain designated civil divisions of its territory. To this end they are invested
with certain governmental powers and charged with civil, political, and municipal duties. To enable
them beneficially to exercise these powers and discharge these duties, they are clothed with the
authority to raise revenues, chiefly by taxation, and subordinately by other modes as by licenses,
fines, and penalties. The revenue of the public corporation is the essential means by which it is
enabled to perform its appointed work. Deprived of its regular and adequate supply of revenue,
such a corporation is practically destroyed and the ends of its erection thwarted. Based upon
considerations of this character, it is the settled doctrine of the law that only the public property
but also the taxes and public revenues of such corporations cannot be seized under execution
against them, either in the treasury or when in transit to it. Judgments rendered for taxes, and the
proceeds of such judgments in the hands of officers of the law, are not subject to execution
unless so declared by statute. The doctrine of the inviolability of the public revenues by the
creditor is maintained, although the corporation is in debt, and has no means of payment but the
taxes which it is authorized to collect.
Another error assigned by counsel for appellant is the holding of the court a quo that the proper remedy
for collecting the judgment in favor of the plaintiff was by way or mandamus.
While this question is not necessarily included in the one which is the subject of this appeal, yet we
believe that the holding of the court, assigned as error by appellant's counsel, is true when, after a
judgment is rendered against a municipality, it has no property subject to execution. This doctrine is
maintained by Dillon (Municipal Corporations, vol. 4, par. 1507, 5th ed.) based upon the decisions of
several States of the Union upholding the same principle and which are cited on page 2679 of the
aforesaid work. In this sense this assignment of error, we believe, is groundless.
By virtue of all the foregoing, the judgment appealed from should be and is hereby affirmed with costs
against the appellant. So ordered.

Avancea, C. J., Street, Malcolm, Ostrand, Johns, Romualdez and Villa-Real., JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-301

April 7, 1948

CARLOS PALANCA, petitioner-appellee,

vs.
THE REPUBLIC OF THE PHILIPPINES, movant-appellant.
Office of the Solicitor General Lorenzo M. Taada and Solicitors Pedro S. Reyes and Felix V. Makasiar
for movant-appellant.
Roxas, Picazo, and Mejia for petitioner-appellee.
Vicente Sotto as amicus curiae.
PADILLA, J.:
In 1941 Carlos Palanca applied for citizenship under the provisions of Commonwealth Act No. 473.
Hearing on the petition was held but no decree was entered because the Pacific War supervened. On 11
September 1944, the Court of First Instance of Manila under the Japanese sponsored Republic of the
Philippines entered a decree granting the petition upon the evidence heard before the outbreak of the
war. However, the petitioner did not take the prescribed oath as a condition precedent to the issuance of
the certificate of naturalization. After the reconstitution of the record of the proceedings which had been
destroyed as a result of the battle for the liberalization of Manila, the petitioner took the oath and he was
issued certificate of naturalization No. 1000.
On 3 July 1945, the Solicitor General filed a motion which he amended on 8 August, praying for the
cancellation of the certificate of naturalization issued to the petitioner, on the ground that the latter does
not and did not possess good moral character, that he has not conducted himself in an "irreproachable
manner in his relation with the constituted government," that he is not loyal to the Commonwealth
Government of which he desires to be citizen, and that citizenship being a political status, the decree
granting it entered by a court exercising judicial powers under the authority of the enemy sponsored
Government is null and void.
At the hearing of the motion for cancellation, when Solicitor Pedro S. Reyes was starting to present the
evidence for the Government, counsel for the petitioner asked leave of the court to be allowed to prove
that the petitioner is a Filipino citizen, and informed the court that upon that ground he would join in the
move to cancel the certificate of naturalization issued to the petitioner (p. 17, t.s.n.). The leave having
been granted, counsel for petitioner submitted evidence which shows that

Carlos Palanca arrived in the Philippine in the year 1884 and that since his arrival he continually
resided in the City of Manila with the exception of the occasion, in the year 1902, when he left the
Philippines for two months to attend the burial of his uncle Don Carlos Palanca, which took place
in China; that in 1894 he wanted to marry a Filipina, and because the Archbishop of Manila had
decreed that a Chinaman, even if Christian, could not marry a native of the Philippines, in that
year (it must have been in 1893) he applied for Spanish citizenship; that in connection with said
application he received from the Gobernadorcillo de Sangleyes the document Exhibit A, dated
January 19, 1894, wherein the petitioner, Carlos Palanca was informed of the Royal Decree of
the regent, the Queen Maria Cristina, of November 30, 1893, by which he was granted Spanish
citizenship in accordance with the laws of the Monarchy, which was to be effective upon giving his
oath provided for in such cases and after he shall have renounced his foreign allegiance; that in
addition to Exhibit A, petitioner also received and presented as Exhibit B a notification to the
Gobernadorcillo de Sangleyes from the Secretaryship of the General Government whereby the
former was informed of the royal decree of the Regent, Queen Maria Cristina, dated November
30, 1893, by which the applicant, Carlos Palanca was granted the Spanish citizenship to enter
into effect upon his giving the corresponding oath (In this communication the text of the Royal
Decree is quoted); that on the day following the receipt of Exhibit A, the petitioner repaired to
Malacaang and there gave his oath of allegiance and received the corresponding certificate of
Spanish citizenship, which was burned in his house at Taft Avenue during the battle for liberation
of Manila on the return of the Americans in 1945; that Exhibit B was the communication referred
to as having been received by the Gobernadorcillo de Sangleyes from the Secretaryship of the
General Government; that on February 4, 1894, and after having acquired the Spanish
citizenship, Carlos Palanca Tan Tiaojua (Quian Lay) married Cesarea Cano Torres, native and
resident of the District of Binondo, Manila (Exhibit D); that from then on the petitioner, Carlos
Palanca, considered himself a Spanish subject, was registered as such in the Spanish Consulate
General in Manila and has as late as March 2, 1942, received from said Consulate Duplicate
Certificate No. 548 issued by the Spanish Consul General, Jose del Castano (Exhibit C); that
because the petitioner, Carlos Palanca, believed himself to be a Spanish subject and desirous of
acquiring Filipino citizenship by naturalization, he instituted this case in 1941, and when he
married on April 12, 1945, his present wife, Rosa Gonzales, prior to the receipt of his Certificate
of naturalization No. 1000, he made it appear therein that he was of Spanish nationality; and that
during the course of his application for Filipino citizenship by naturalization, he also adduced
evidence to show that he had acquired the Spanish nationality during the Spanish regime in these
Islands (Order of the Court of First Instance of Manila dated 7 January 1946.)
Holding that the petitioner is a Filipino citizen pursuant to section 4 of the Act of the Congress of 1 July
1902 and section 2 of the Act of Congress of 29 August 1916, the trial court granted the motion for
cancellation of the certificate of naturalization issued to the petitioner, not upon the grounds alleged in the
motion but for the reason that the certificate of naturalization was unnecessary. From this order the
Solicitor General in behalf of the Government appeals.
It is earnestly urged by the Solicitor General that, because of the second paragraph of Article IX of the
Treaty of Paris which stipulated that
The civil rights and political status of the native inhabitants of the territories hereby ceded to the
United States shall be determined by the Congress,
section 4 of the Act of Congress of 1 July 1902, which provides
That all inhabitants of the Philippine Islands, continuing to reside therein who were Spanish
subjects on the eleventh day of April, eighteen hundred and ninety-nine, and then resided in said
islands, ... shall be deemed and held to be citizens of the Philippine Islands . . . .
and section 2 of the Act of Congress of 29 August 1916, which provides

That all inhabitants of the Philippine Islands who were Spanish subjects on the eleventh day of
April, eighteen hundred and ninety-nine, and then resided in said Islands, ... shall be deemed and
held to be citizens of the Philippine Islands, . . . .
should be construed to refer not to all inhabitants of the Philippine Islands but only to native inhabitants
thereof. Stated differently, the term "all inhabitants" means native inhabitants only, according to the
interpretation and contention of the Solicitor General. The provisions of the Acts of Congress quoted
above do not have the import given them by the Solicitor General, even if they were construed in
connection with the second paragraph of Article IX of the Treaty of Paris also quoted above. By the Treaty
of Paris, Spain ceded to the United States the territory known as the Philippine Islands. There was no
need of stipulating on the future political status of the inhabitants of the Philippine Islands thus ceded,
except perhaps on the status of those who might choose to preserve their allegiance to Spain (Article IX,
par. 1, Treaty of Paris), because the power and authority to determine the political status of said
inhabitants was inherently vested in the United States. There could be no limitation upon the power and
authority to determine the political status of said inhabitants by the United States, and for that reason the
enactment of a law by the latter declaring that all inhabitants of the Philippine Islands, who were Spanish
subjects on the 11th day of April, 1899, and then resided therein, are citizens thereof, cannot be
construed to contravene the treaty stipulation referred to. The plenipotentiaries of Spain who signed the
Treaty of Paris could not have been solicitous only about the future political status of her subjects residing
in the Philippine Islands who were not born in Spain. If Spain had allowed her subjects born in Spain who
were residing in the Philippines Islands to become citizens of the latter upon their failure to preserve their
allegiance to her (Spain), it could not have been her intention not to allow her subjects residing in the
Philippine Islands who were not born in Spain to become citizens of the country of their residence, in the
same way that she allowed her subjects born in Spain and residing in the Philippine Islands to become
citizens of the latter, or, by failing to stipulate on their future political status, to make them citizens of their
country of origin, the citizenship of which they had renounced by becoming Spanish subjects. There
seems to be no doubt that the lack of treaty stipulation regarding Spanish subjects residing in the
Philippine Islands, who were not born in Spain, was merely due to an oversight. It was not deliberate for
the purpose of reverting them to the citizenship of their country of origin, for a change of citizenship must
be voluntary or by an act, express or implied, of the citizen or subject. Hence, it may safely be asserted
that the second paragraph of Article IX of the Treaty of Paris is not a limitation upon the power of the
United States to determine the political status of all inhabitants of the Philippines who were Spanish
subjects on the 11th day of April 1899 and continued to reside therein. There being no limitation, as there
could be none, the petitioner, who was an inhabitant of the Philippine Islands and a naturalized subject of
Spain on the 11th day of April 1899, is a Filipino citizen, by virtue of the provisions of section 4 of the Act
of congress of 1 July 1902 and of section 2 of the Act of congress of 29 August 1916. under the
Constitution he is also a citizen of the Philippines because he was such at the time of the adoption of the
Constitution.
Before the enactment of Commonwealth Act No. 63, as amended, there was no law providing for causes
which may result in the forfeiture of Philippine citizenship, but international law recognizes expatriation,
naturalization in a foreign country, military service rendered in and for another country, and marriage of a
female citizen to a
foreigner to cite some instances as causes which may give rise to the loss of citizenship. The
evidence does not show that the petitioner had expatriated himself, that he had been naturalized in a
foreign country, or that he had rendered military service in and for another country. Except an absence of
two months in 1902 he has never been out of the Philippines.
His holding out as Spanish subject, as shown in his two marriage certificates (Exhibits D and F) and his
registration in the Spanish Consulate as such subject, has been satisfactorily explained. He only came to
know after he had filed his petition for naturalization that, under the Treaty of Paris and the Acts of
congress of the United States already referred to, he is a Filipino citizen. A proof thereof is his application
for citizenship in 1941. But his mistake or misapprehension as to his citizenship is not a sufficient cause
or reason under the law for the forfeiture of his Philippine citizenship. Neither may such mistake or
misapprehension constitute estoppel.

The motion for cancellation is based upon the provisions of section 18 (a) of Commonwealth Act No. 473.
But the trial court ordered the cancellation of the petitioner's certificate of naturalization, not because he
had obtained it fraudulently or illegally, but because he does not need it, as he is a Filipino citizen. Upon
the facts established, it cannot be held that the petitioner secured his certificate of naturalization
fraudulently or illegally. Thus, under the law invoked by the Solicitor General, the cancellation prayed for
cannot be granted for lack of evidence to show fraud or illegality on the part of the petitioner in the
obtainment of the certificate of naturalization. At most, the certificate may be held illegal because it was
issued pursuant to a decree entered by a court exercising judicial powers under the authority of the
enemy sponsored Republic of the Philippines. Logically, however, the cancellation was correctly ordered,
because a Filipino citizen need not apply for such citizenship by naturalization or have a certificate of
naturalization to be citizen of the Philippine Islands of which he is already a citizen.
The order appealed from is affirmed, without costs.
Moran, C.J., Paras, Pablo, Bengzon, and Tuason, JJ., concur.

Separate Opinions
PERFECTO, J., dissenting:
Appellee Carlos Palanca was a Chinese citizen by birth and continued to be so until November 30, 1893,
when he was granted Spanish citizenship in accordance with the laws of the monarchy, by a Royal
decree of the regent, the queen Maria Cristina of Spain. He wanted to marry a Filipina but the Archbishop
of Manila had decreed that a Chinaman, even if Christian, could not marry a native of the Philippines. To
accomplish the marriage, appellee applied for Spanish citizenship.
On February 4, 1894, after having acquired Spanish citizenship, Palanca married Cesarea Cano Torres.
Since then he considered himself a Spanish subject. He registered as such in the Spanish Consulate
General in Manila and has as late as March 2, 1942, received from the said consulate duplicate certificate
No. 548. In 1941 he instituted this case to acquire Filipino citizenship. On April 12, 1945, when he married
Rosa Gonzales, his present wife, he made it appear in the contract of marriage that he was of Spanish
nationality.
The above facts are stated in the brief for appellee Palanca.
In these naturalization proceedings, after the Solicitor General had filed on July 3, 1945, a motion to set
aside the certificate of naturalization issued to Carlos Palanca pursuant to a decision rendered during the
Japanese regime on September 11, 1944, the lower court issued on January 7, 1946, an order declaring
Carlos Palanca, a Filipino citizen, which is now under our consideration.
The motion to set aside the certificate of naturalization issued to Carlos Palanca reads as follows:
Now come the undersigned counsel on behalf of the Commonwealth Government of the
Philippines and to this Honorable Court, with leave first being had, respectfully set forth and
allege:
1. That the above-titled case was heard and tried before the Court of First Instance of Manila in
the month of November, 1941, and was pending decision therein when the Commonwealth
Government was overthrown and displaced by the Imperial Japanese Forces in the early part of
1942;

2. That the applicant, after the Japanese Military Administration had ordered the suspension of
action on cases of this nature, in his motion dated July 29, 1944, asked the Court of First instance
of Manila organized and existing under the Japanese sponsored Republic of the Philippines, that
the case be decided and given due course asserting that the applicant was neither hostile to nor
an enemy of the Japanese Empire;
3. That on September 11, 1944, Judge Roman A. Cruz of the Court of First Instance of Manila
during the regime of the Japanese sponsored Republic of the Philippines, promulgated the
decision decreeing that the applicant, Carlos Palanca, satisfied the requirements of law to
become a Filipino citizen and ordering the issuance of a certificate of naturalization in his favor
once the decision becomes final;
4. That on the basis of the said decision, upon oral petition of the applicant and on the strength of
the certificate dated April 14, 1945, one by Honorable Sixto de la Costa, Solicitor General of the
Republic of the Philippines, and the other by Macario M. Ofilada, Acting Assistant Clerk of the
Honorable Court, the applicant was allowed on the same date to take the oath of allegiance
before Judge Arsenio F. Dizon of the Court of First Instance of Manila, Branch II; and as a result
thereof the proper naturalization certificate was issued to the applicant by the Clerk of this
Honorable Court on April 16, 1945;
5. That on April 17, 1945, the said Judge Arsenio P. Dizon motu propio, ordered and directed the
cancellation of the oath and the certificate of naturalization referred to in paragraph 4, on the
ground that before the applicant could legally take the oath of allegiance, the records of the case
which had been burned or lost sometime in February, 1845, must first be reconstituted in
accordance with law;
6. That upon motion of the applicant dated April 24, 1945, and the submission of an authentic
copy of the decision rendered by Honorable Roman A. Cruz on September 11, 1944, this
Honorable Court on April 30, 1945, declared the records of these proceedings as reconstituted,
and allowed the applicant to take the prescribed oath of allegiance and the Clerk of this
Honorable Court to issue the corresponding certificate of naturalization;
7. That on April 30, 1945, the applicant took the prescribed oath of allegiance before this
Honorable Court, and on the same day the certificate of naturalization was issued to him by the
Clerk of the Honorable Court;
8. That Carlos Palanca during the period of enemy occupation, holding himself before the public
as a citizen and subject of Spain, a country which is Pro-Axis in sympathy, was president of the
"ASOCIACION CHINA PRO-NIPONA," an association which, from its very name, was engaged,
among other things, in collecting contribution, especially of money, for the support of the
Japanese Imperial Army and to which he himself gave a personal contribution of P60,000; and
that as a consequence of his sympathy, work, aid and support of enemy, he enjoyed privileges
from the Japanese Military Authorities, especially by the way of a big alcohol quota for his
distillery;
9. That the facts alleged in the paragraph immediately preceding are supported by the affidavit of
Maria Teresa Palanca Cuartero (Teresa del Rio) hereto annexed as "Annex A-1," and that of
Benigno del Rio, hereto annexed as "Annex A-2," both of which are attached as integral parts
hereof;
10. That Carlos Palanca was at one time confined in Bilibid Prisons from 1896 to 1899, as shown
by the following:

(a) "Se ha recibido en este Establecimiento al Chino Carlos Palanca Tan Tiao
Jun alias Tan Cuin Lay en clase de preso provisional a disposicion del Juzgado de
Primera Instancia de Binondo a resultas de la causa No. 7766 por estafa y falsification de
documento mercantil, segun mandamiento de dicho juzgado.
"Bilibid, 29 de agosto de 1896.
"El Alcalde 1.

"(Fdo.) MANUEL GARCIA"

"Copiado del folio 377 del Expediente de la Causa Criminal No. 7765 del Juzgado de
Primera Instancia de Binondo."
(b) "I certify that the records in this office shows that Carlos Palanca Tan Tiao Jim known
by the name of Tan Guin Lay, charged with "Estafa" and "Falsification" was received for
confinement at this Prison, on July 7th 1896, by order of the Court of First Instance of
Binondo, Manila, P.I. and was released on April 13th, 1899.

"(Sgd.) GEO. N. WOLFE

"Warden"

which fact was not brought out to lights in the proceeding originally had in this case, this
making the naturalization certificate issued to him, one that is 'fraudulently procured";
11. That, considering the sympathies and activities of Carlos Palanca during the period of the
enemy occupation, he had demonstrated that he had not 'evinced a sincere desire to learn and
embrace the customs, traditions, and ideals of the Filipinos'; that he has not conducted himself in
an "irreproachable manner in his relation with the constituted government"; and that he is not
loyal to the Commonwealth Government of which he desires to be citizen; all of which facts,
under the provisions of law, disqualify him from becoming a citizen of the Philippines and
consequently render the certificate of naturalization issued to him revocable for being fraudulently
and illegally procured;
12. That the grant of citizenship by naturalization to the applicant, Carlos Palanca, by the
Japanese-controlled government being merely a privilege purely political in nature, conferred no
vested rights, and cannot give force and effect beyond the life of the authority from which it
emanated;
13. That only the Commonwealth Government has power and authority to decide who should
become naturalized citizens of the Philippines and entitled to its protection in return for their
allegiance thereto; consequently the courts of the Japanese-controlled Republic of the Philippines
has neither the authority nor the right to decide and determine who should be naturalized citizens
of the Commonwealth of the Philippines;
14. That, as a matter of public policy the herein applicant who formally and solemnly affirmed, on
July 29, 1944, that he was neither hostile nor an enemy of the Japanese Empire should not be

admitted to Philippine citizenship, especially considering that the Philippines is still at war with
Japan;
15. That, as against the Commonwealth of the Philippines, the decision of Judge Roman A. Cruz
of September 11, 1944, and the certificate of naturalization issued in pursuance thereof, are null
and void and without any legal force and effect; and
16. That the certificate of naturalization issued to the applicant, Carlos Palanca, is illegal on the
further ground that he does not and did not possess that moral character above reproach which is
required by law as one of the qualifications for citizenship by naturalization;
Wherefore, it is respectfully prayed that the decision of Judge Roman A. Cruz promulgated on
September 11, 1944, and the certificate of naturalization issued to Carlos Palanca be cancelled,
set aside and declared without any legal effect.
Manila, August 8, 1945.

(Sgd.) LORENZO TAADA

Acting Solicitor General
(Sgd.) PEDRO S. REYES
Acting Solicitor

Upon the facts in this case, it seems unnecessary to engage in a fruitless long discussion and
interpretation of the Treaty of Paris and applicable legal provisions. The proceedings which took place in
the lower court appeared to be highly anomalous. What Palanca failed to obtain by direct procedure, was
granted to him in an indirect way.
There is no question as to his Spanish citizenship. He was of that firm conviction even after he obtained in
1944 a decision allowing him to be registered as a naturalized Filipino. On April 12, 1945, he stated in a
public document, one of the most solemn that he could ever execute, his marriage contract with his
present wife Rosa Gonzales, his Spanish nationality.
Carlos Palanca, as we can deduce from his own testimony and the record, is a very intelligent person. He
is and has been assisted by competent counsel. When he filed his application for naturalization, he did it
with the assistance of counsel. That years after he filed said application, after obtaining the corresponding
certificate of naturalization, and after the Solicitor General had moved for the cancellation of said
certificate, he discovered that he was already a Filipino citizen before applying for naturalization, is a thing
that can hardly have its parallel in judicial history. That a court of justice should countenance such a
belated discovery is, at least, surprising.
Appellant impugns the appealed order for the error of holding Palanca a Filipino citizen by virtue of the
Treaty of Paris and Acts of the United States and of the Philippines and for not holding that, if he ever had
that citizenship, he had lost it.
In support of the above propositions, the following able argument is adduced in appellant's brief:
Being closely related with each other, these will be discussed jointly.
The treaty of Paris of December 10, 1898, between the United States and Spain, provides:

1. "ARTICLE IX. Spanish subjects, natives of the Peninsula, residing in the territory over
which Spain by the present treaty relinquishes or cedes her sovereignty, may remain in
such territory or may remove therefrom, retaining the right to sell or dispose of such
property or of its proceeds; and they shall also have the right to carry on their industry,
commerce, and professions, being subject in respect thereof to such laws as are
applicable to other foreigners. In case they remain in the territory they may preserve their
allegiance; in default of which declaration they shall be held to have renounced it and to
have adopted the nationality of the territory in which they may reside.
"The civil rights and political status of the native inhabitants of the territories
hereby ceded to the United States shall be determined by the Congress." (Public
Laws, Vol. 1, pp. 1049-1050.)
Pursuant to the foregoing treaty provision, the Congress of the United States enacted the Act of
July 1, 1902, otherwise known as the "Philippine Bill", section 4 of which provides:
"SEC. 4. That all inhabitants of the Philippine Islands, continuing to reside therein who
are Spanish subjects on the eleventh day of April, eighteen hundred and ninety-nine, and
then resided in said Islands, and their children born subsequent thereto, shall be deemed
and held to be citizens of the Philippine Islands and as such entitled to the protection of
the United States, except such as shall have elected to preserve their allegiance to the
Crown of Spain in accordance with the treaty of peace between the United States and
Spain signed at Paris December tenth, eighteen hundred and ninety-eight." (Public Laws,
Vol. 1, pp. 1056-1057.)
When the Congress of the United States by law on August 29, 1916, provided for a more
autonomous government in the Philippines, it reiterated the provisions of section 4 of the
"Philippine Bill", as amended on March 23, 1912, in its definition of "citizens of the Philippine
Islands":
"SEC. 2. That all inhabitants of the Philippine Islands who were Spanish subjects on the
eleventh day of April, eighteen hundred and ninety-nine, and then resided in said Islands,
and their children born subsequent thereto, shall be deemed and held to be citizens of
the Philippine Islands, except such as shall have been elected to preserve their
allegiance to the Crown of Spain in accordance with the provisions of the treaty of peace
between the United States and Spain, signed at Paris December tenth, eighteen hundred
and ninety-eight, and except such others as have since become citizens of some other
country: Provided, that the Philippine Legislature, herein provided for, is hereby
authorized, to provide by law, for the acquisition of Philippine citizenship by those natives
of the Philippine Islands who do not come within the foregoing provisions, the natives of
the insular possessions of the United States, and such other persons residing in the
Philippine Islands who are citizens of the United States, or who could become citizens of
the United States under the laws of the United States if residing therein." (Public Laws,
Vol. 12, p.238.)
And when the Commonwealth of the Philippines came into being, its Constitution, adopted on
February 8, 1935, declared the following, among others, as citizens of the Philippines:
"(1) Those who are citizens of the Philippine Islands at the time of the adoption of this
Constitution." (Article IV, sec. 1, subsection 1, Constitution of the Philippines.)
The same Constitution provides that "Philippine citizenship may be lost or reacquired in manner
provided by law." (Article IV, section 2, Constitution of the Philippines.) Acting upon this provision,
the National Assembly enacted Commonwealth Act No. 63 which took the effect upon it approval

on October 21, 1936, providing for certain and definite ways of losing or reacquiring Philippine
citizenship. (See Com. Act. No. 63, Public Laws of the Com., Vol. I, pp. 418-419) Prior to the date
of passage of said Act, no definite rule was prescribed by legislative enactment upon the subject
of expiration, but then it was judicially recognized that even in the absence of such an enactment,
denationalization or expatriation could occur and take effect. Thus, this Honorable Court, in the
case of Roa vs. Collector of Customs, 33 Phil., 315, 323 said:
"The right of expatriation is a natural and inherent right of all people (Act of Congress,
July 27, 1868). Expatriation is the voluntary renunciation or abandonment of nationality
and allegiance. The Act of Congress of 1868 does not define what steps must be taken
by a citizen before it can be held that he has become denationalized. In fact, there is no
mode of renunciation of citizenship prescribed by law in the United States. Whether
expatriation has taken place in any circumstances of the particular case. No general rule
that will apply to all cases can be laid down. Once a person becomes an American
citizen, either by birth or naturalization, it is assumed that he desires to continue to be a
citizen of the United States, and can regain his lost citizenship only by virtue of the same
laws, and the same formalities, and by the same process by which other aliens are
enabled to become citizens."
And in order that loss of citizenship may take effect, it has been held that no actual or express
renouncement is necessary.
The lower court in its decision said:
"The petitioner, having been born in the Philippine Islands and being a citizen, does not
cease to be such citizen at law until such time as he has taken steps to renounce his
allegiance as such citizen."
"This assumption of law is not in conformity with the actual decisions. No actual or
express renouncement of citizenship is necessary" (Lorenzo vs. McCoy, 15 Phils., 559,
590).
In the light of the foregoing restatement of the law on Philippine citizenship and jurisprudence on
denationalization or expatriation, we believe and so submit that appellee has never been a citizen
of the Philippines; and that if he ever was at all, he had lost that status before the adoption of the
Constitution of February 8, 1935. This we shall presently show.
A. Appellee has never been a citizen of the Philippines.
Appellee herein is neither a "native inhabitant" of the Philippines on April 11, 1899. Neither was
he, then, Spanish subject who is a "native inhabitant from Spain to the United States (articles 3
and 9 of the Treaty of Paris)." (Roa vs. Collector of Customs, 23 Phil., 331, 336; In Re Bosque, 1
Phil., 89-90.)
If he were a Spanish subject, "native of the Peninsula", under the terms of Article IX of the Treaty
of Paris, he had the option to remain in the Islands or to remove therefrom. In case he chose to
remain, again he had the option of preserving his allegiance to the crown of Spain in the manner
and within the time prescribed. Whichever way he followed, there could be no question as to his
status, for it has been held that:
"With respect to these the special agreement contained in article 9 was established, by
virtue of which it was agreed to accord them the right of election to leave the country, thus
freeing themselves of subjection to the new sovereign, or to continue to reside in the
territory, in which case the expiration of the term of eighteen months without making an

express declaration of intention to retain their Spanish nationality resulted in the loss of
the latter, such persons thereby becoming subjects of the sovereign in the same manner
as the natives of these Islands," (In Re Bosque, 1 Phil., 89.)
But appellee had the peculiar position of being neither one nor the other, he being
Chinese, naturalized as Spanish subject, residing in the Philippines at the time of its cession from
Spain to the United States. No case similar to his has ever been decided in the past. In applying
the provisions of the various Acts of the United States Congress respecting Philippine citizenship
to the case at bar, we cannot escape reference to the provisions of Article IX of the Treaty of Paris
which, as between the high Contracting Parties, is the law regulating the transfer of allegiance of
the inhabitants of the territories ceded in said treaty from Spain to the United States.
"1. The relation which the inhabitants of ceded territory shall bear to the acquiring state are
generally determined by the treaty of cession. Every treaty of cession to which the United States
has been a party, with the exception of the Treaty of Peace of 1898 with Spain, ceding Puerto
Rico and the Philippine Islands to the United States, contain the stipulation providing that the
inhabitants of the territory ceded may in whole or in part become citizens of the United States
either immediately or under certain conditions. In the Treaty of Paris the high contracting parties
agreed that the civil rights and political status of the native inhabitantsof the Philippine islands
shall be determined by the Congress of the United States. The contracting parties further agreed
that all Spanish subjects, natives of the Peninsula, ... ." (Roa vs. Collector of Customs, 23 Phil.,
315, 332-333. emphasis supplied.)
In the Treaty of Paris, it was stipulated between the Contracting Parties that "the civil rights and
political status of the native inhabitants of the territories hereby ceded to the United States shall
be determined by the United Stateless Congress"' (paragraph 2, Article 9, supra). Said Congress,
subsequently, by various enactments deemed and held as citizens of the Philippine Islands all
inhabitants thereof who were Spanish subjects and were residing therein on April 11, 1989,
including their children born subsequently thereto (section 4, Act of July 1, 1902, amended later
by Act of March 23, 1912; section 2, Act of August 29, 1916,supra).
While it is true that each sovereignty has inherent and absolute power to determine for itself who
shall be its citizens (Roa vs. Collector of Customs, 23 Phil., 315, 321; U.S. vs. Wong Kim Ark, 169
U.S. 601, 668), yet when one sovereign nation has voluntarily, upon mutual considerations,
bound itself by solemn stipulation in a treaty entered into with another, as in the case, to the effect
that it should determine the political status of the native inhabitants of the territories ceded to it by
the other, it may no longer, in that particular instance at least, in the exercise of its absolute
sovereign rights, determine the political status of all inhabitants without limiting itself to the native
inhabitants.
In the interpretation and application, therefore, of the terms "inhabitants" as used in the various
Acts of Congress, considered in subordination to the Treaty of Paris, that term should be taken as
intended to mean only the "native inhabitants." As appellee is definitely not a 'native inhabitant' of
the Philippines, he does not, we submit, come within the definition of citizens of the Philippines
under various Acts of Congress.
B. If appellee ever was a citizen of the Philippines, he had already lost that status.
Admitting arguendo that appellee became a citizen of the Philippines by operation of the Treaty of
Paris and the various Acts of congress of the United States, we contend, and so submit, that he
had lost that status long before the adoption of the Constitution on February 8, 1935.
We have shown that the statutory requirements for the loss of Philippine citizenship existed for
the first time only since October 21, 1936, when Commonwealth Act No. 63 was enacted to

implement the provisions of section 2, Article IV of the Constitution adopted on February 8, 1935.
It is not our claim in the case at bar that appellee lost his citizenship after the adoption of the
Constitution, in which event it would be necessary to establish that he, by his conduct or attitude,
had lost such citizenship by any of the ways mentioned in Commonwealth Act No. 63.
We do claim, however, that the undisputed facts in this case unmistakably point to an unbroken
course of conduct on the part of appellee for a long period of time prior to the adoption of the
Constitution, which course of conduct amounted to a renunciation and abjurement of his
citizenship, his domicile in the Philippines notwithstanding. Certainly, as to this particular segment
of time in the life of appellee, in determining whether he had, by his attitude and conduct, effected
a renunciation of his citizenship, we cannot apply, as the trial court did, the provisions of
Commonwealth Act No. 63 in relation to section 2, Article IV of the Constitution without giving
them retroactive affect, which is not authorized.
"As we have already stated before, expatriation or renunciation of Philippine citizenship, prior to
the adoption of the Constitution, was possible and could take effect, even in the absence of
express or actual renouncement (Roa vs. Collector of Customs, supra; Lorenzo vs.
McCoy, supra).
All these long years appellee has resided in the Philippines, not as a citizen, not with the
sentiments of a citizen, but as a foreigner, with the sentiments of a foreigner. He has lived here
thus, in war and in peace, exempt of the duties and obligations of a citizen. He must have never
dreamed for a moment that he was a Filipino. But now, after such a long period of time, he claims
Philippine citizenship under the Treaty of Paris and the various Acts of the United States
Congress. Citizenship is not just a mere cloak that may be laid aside for years, only to be picked
up for use as occasion suits.
"While domicile, and the intent necessary to establish domicile, are in many cases
determinant of questions of expatriation, they do not govern where statutory conditions of
expatriation exist, such as repatriation by performance of military service or the taking of
an oath of allegiance. Nor do they govern where it appears that aside from them there
exist a course of conduct which involves a renunciation of American citizenship",
(U.S. vs. Longo, 46 F. Supp. 170, 174, emphasis supplied.)
"The question of expatriation, like that of domicile, so far as it depends on the citizen's
will, is to be decided ex facto et animo". (Alsberry vs. Hawkins 9 Dana, 177, 33 Am. Dec.
546, 549.)
"Clearly, a more after-thought, created by personal expediency, cannot be enough (to
overcome presumption of expatriation). Such would make American citizenship a mere
travesty instead of the high privilege that it is, and must always remain. (Shaufus vs. Atty.
Gen., 45 F. Supp., 61, 67.)
Appellee's application for naturalization in 1941, and his registration as a Spanish national with
the Spanish Consulate General in Manila, indeed strengthen our contention that he had, in fact
and intention, divested himself of his Philippine citizenship. His conduct (see Rec. of App. pp. 5258) plainly indicates that he did not consider himself bound by the obligations inherent to the
Filipino citizenship he now claims.
We believe, therefore, that appelle had, prior to the adoption of the Constitution, effected implicitly
a renunciation of his Philippine citizenship, if he had that status; and in submitting this question to
this Honorable Court we are confident that it will not lose sight of the superior interest of the State
against claimants for citizenship.

"Citizenship is a high privilege, and when doubts exist concerning a grant of it, generally at least,
they should be resolved in favor of the United States and against the claimant" (U.S. vs. Manzi,
276, U.S. 463, 467; 48 S. Ct. 328, 329; 72 L. ed., 654.)
C. Therefore, appellee is not a citizen under the Constitution.
If appellee was not a citizen of the Philippines by virtue of the Treaty of Paris and the Acts of the
United States Congress; or being a citizen thereunder, he had lost such status prior to the
adoption of the Constitution, he can no longer be deemed a citizen of the Philippines under the
provisions of section 1, Article IV of said Constitution.
There is no necessity for us to show whether Palanca is still a Spanish citizen or has reverted to his
original Chinese citizenship. The important thing is that he is not a Filipino citizen. No amount of legal
logodaedaly may erase the stark reality that when he applied for Philippine citizenship, in everybody's
conscience, in the conscience of his counsel, and in his own conscience, there was the unbreakable
conviction that he was not a Filipino citizen. No one would think that the naturalization proceedings
instituted by him had been started with the purpose of performing in a judicial stage an expensive and
troublesome farce. That, in order to sidetrack the frontal attack made by the Solicitor General against his
certificate of naturalization, he found it expedient to adopt the theory that he did nor need to be
naturalized, because he is a Filipino citizen and he was so even before he applied for naturalization, is an
able strategy that should not deceive courts of justice and induce them to give an imprimatur to a legal
comedy.
We vote that the appealed order on January 7, 1946, be set aside and the lower court instructed to
proceed with the hearing on the petition for cancellation of the certificate of naturalization issued to
appellee and that, upon said evidence, to decide the question according to the facts as it may find.

HILADO, J., dissenting:

I have the misfortune to disagree with the majority of my brethen in their holding that Carlos Palanca,
petitioner-appellee, was a Filipino citizen upon the date of his application for naturalization under
Commonwealth Act. No. 473. In my opinion, he was a Chinese citizen at that time.
Petitioner-appellee a native born subject of the former Empire of China, became a naturalized Spanish
subject by virtue of the Royal Decree of the Regent, Queen Maria Christina, of November 30, 1893. Upon
the date of the said decree, he was already residing in the Philippines, where he arrived in 1884. The
Spanish-American War of 1898 came, and after the defeat of the Spanish forces the Treaty of Paris was
negotiated and concluded on December 10, 1898. In due time the exchange of ratification of said treaty
took place.
In Article IX of said treaty it was provided as follows:
Spanish subjects, natives of the Peninsula, residing in the territory over which Spain by the
present treaty relinquishes or cedes her sovereignty, may remain in such territory of may remove
therefrom, retaining in either event all their rights of property, including the right to sell or dispose
of such property or of its proceeds; and they also have the right to carry on their industry,
commerce and professions, being subject in respect thereof to such laws as are applicable to
other foreigners. In case they remain in the territory they may preserve their allegiance to the
Crown of Spain by making, before a court of record, within a year from the date of the exchange
of ratifications of this treaty, a declaration of their decision to preserve such allegiance; in default

of which declaration they shall be held to have renounced it and to have adopted the nationality of
the territory in which they may reside.
The civil rights and political status of the native inhabitants of the territories hereby ceded to the
United States shall be determined by the Congress. (Emphasis supplied.)
It appears from the first paragraph of the above quoted article that the High Contracting Parties expressly
stipulated how the "Spanish subjects, natives of the Peninsula, residing in the territory over which Spain
by the present treaty relinquishes or cedes her sovereignty," might preserve their allegiance to the Crown
of Spain, or lose their allegiance and be held to have adopted the nationality of the territory in which they
might reside. In the second paragraph of the same article the High Contracting Parties also agreed that
the civil rights and political status of the native inhabitants of the territories hereby ceded to the United
States shall be determined by the Congress" (of the United States).
It is Significant that the High Contracting Parties did not make any express stipulation regarding the
political status, citizenship, or allegiance of the inhabitants, not "natives of the Peninsula" nor "native
inhabitants of the territories". In other words, they refrained from providing in the treaty for the political
status of all other inhabitants of said territories. Among those other inhabitants of the Philippines was
Carlos Palanca. This, per-force, leads me to conclude that the High Contracting Parties agreed to let the
recognized rules of international law govern as to the political status, citizenship, or allegiance of their
latter group of inhabitants, instead of agreeing that the Congress of the United States shall determine
their political status. Hence, section 4 of the Philippine Bill, and section 2 of the Jones Law, should be
construed as exclusive of them.
Otherwise stated, my construction of the treaty is that the High Contracting Parties agreed to exclude
from what would have been the ordinary operation of international law as regards to the political status of
the territorial inhabitants: (1) those Spanish subjects who were natives of Spain and (2) the native
inhabitants of the territories. All others were to be subject to the rules of international law.
In Roa vs. Collector of Customs, 23 Phil. 315, 332-333, this Court said:
The relations which the inhabitants of the ceded territory shall bear to the acquiring state are
generally determined by the treaty of cession. . . . .
That determination was made in Article IX, 1st paragraph, of the Treaty of Paris, as to the "Spanish
subjects, natives of the Peninsula," and agreed to be made, under the 2nd paragraph of the same Article,
by the Congress of the United States thereafter. As to the rest of the territorial inhabitants who owed
Spain natural allegiance based "upon the law of nature and the code of nations" (Tobin vs. Walkinshaw,
23 Fed. Cases, 1346, 1348), International Law fixed their political status, as declared by Chief Justice
Marshall in American Insurance Co. vs. 356 Bales of Cotton, 1 Pet. (U.S.) 511; 7 Law ed. 242, 255, as
follows:
. . . On such transfer of territory, it has never been held that the relations of the inhabitants with
each other undergo any change. Their relations with their former sovereign are dissolved, and
new relations are created between them and the government which has acquired their territory.
The same act which transfers their country, transfers the allegiance of those who remain in it . . . .
Such transfer of allegiance, being independent of the will of the inhabitants concerned, logically refers to
that allegiance which attached to them in the first instance independently of their personal volition. This
does not include naturalized citizens without whose voluntary choice and election would never have
become such citizens of the country of adoption nor owed it allegiance. The citizenship and allegiance of
such is pure creature of the municipal law of the country of adoption. The country of adoption had the
power under its municipal law to admit him to naturalized citizenship, but if that country should in the
future cede the territory to another power, the naturalized citizen who remains in the territory is thereby

released from his voluntary allegiance to the ceding power, and the citizen is remitted to his original
status (Tobin vs. Walkinshaw, supra). Consequently, said ceding power cannot transfer the allegiance of
said citizen to the acquiring power.
As said in the Tobin case,
. . . No power existed in one government to transfer, or in the other to receive, the voluntary or
statutory allegiance of a naturalized citizen. ..".
I, therefore, adhere to that doctrine the under International Law the contracting parties to a treaty ceding
territory from one sovereign to another can not subject to their agreement the citizenship, political status
or allegiance of those inhabitants of the ceded territory who at the time of the cession
were naturalized citizens of the ceding power. The contracting parties can only stipulate regarding the
citizenship of those who owed allegiance to the former sovereign by the "law of nature and the code of
nations," as held in the Tobin case above cited (p. 1348):
. . . The allegiance of the naturalized citizen is the offspring of municipal law. Unlike natural
allegiance, its support does not rest upon the law of nature and the code of nations. The only
relations that Mexico or the United States could change, were those arising from those sources.
Nor does the language of the treaty authorize the conclusion that the contracting parties intended
to include within the word 'Mexicans' naturalized citizens of foreign countries. . . .
In the cited case, the Circuit Court for the Northern District of California was construing the 9th article of
the Treaty of Guadalupe Hidalgo between the United States and Mexico, which is remarkably similar in its
terms and provisions to Article IX of the Treaty of Paris between the United States and Spain hereinbefore
referred to. As in said Article 9 of the Treaty of Guadalupe Hidalgo, in Article IX of said Treaty of Paris,
naturalized Spanish citizens are nowhere included eo nomine.
As stated above, Carlos Palanca was, in my opinion, a naturalized Spanish Citizen at the time the Treaty
of Paris went into effect. He became such citizen purely by voluntary choice, unlike his natural citizenship
and allegiance to the former Empire of China, which attached to him upon his birth and wholly
independently of his will. It was exclusively by an act of his will that he applied for naturalization as a
Spanish citizen. He became one because he chose Spain as the country to which he wished to render
allegiance thereafter, with or without a mental reservation of his right of repatriation.
It seems to me naturally to follow from this that it was altogether beyond the power of Spain to transfer his
allegiance and citizenship to the United States, or to subject them to the power of the United States
Congress to determine, quite apart from the admitted power of the new sovereign to exclude him from the
ceded territory under any circumstances determined by the new sovereign. I am of the opinion that,
because he was not a natural but merely a naturalized citizen of the former sovereign, he was remitted to
his native citizenship upon the cession of the territory to the acquiring state.
Petitioner-appellant's remission to his native citizenship was, like his original native citizenship itself, of
course, independent of his will, and regardless of whether he knew it or not. That even as late as the
Japanese occupation he still considered himself a Spanish citizen would not argue against this, just as it
is in effect held by the majority that such fact did not argue against his being a Filipino citizen upon the
date of his application for Philippine naturalization.
At any rate, since petitioner-appellant was neither a "Spanish subject, native of the Peninsula", nor a
"native inhabitant of the territory," it would seem to be clearly beyond the power of the United States
Congress to determine or regulate his citizenship and allegiance.
It is well settled that

. . . In the United States, however, a treaty is more than a contract between nations; by force of
the provision of the federal constitution that this constitution, and the laws of the United States
which shall be made in pursuance thereof; and all treaties made, or which shall be made, under
the authority of the United States, shall be the supreme law of the land; and the judges in every
state shall be bound thereby, anything in the constitution or laws of any state to the contrary
notwithstanding, subject to certain limitations hereafter set forth, a treaty has operative force as
part of the supreme law of the land, is binding on the courts, federal and state, stands on the
same footing of supremacy as the constitution and laws of the United States, ... . (63 C. J., 827828 and supporting cases; emphasis supplied).
Hence, even if the Congress of the United States had expressly mentioned eo nomine naturalized
Spanish citizens in section 4 of the Philippine Bill and section 2 of the Jones Law, in my opinion, such
provision would have been unconstitutional and void, because not warranted by the Treaty of Paris.
Granting, for the sake of argument, however, that Carlos Palanca was once a Filipino citizen, the record
seems plainly to reveal that he had, prior to the adoption of the constitution, expatriated himself, and for
that reason he was not such citizen when the constitution was adopted. As well argued by the Solicitor
General (brief pp. 16-18)
We do not claim, however, that the undisputed facts in this case unmistakably point to an
unbroken course of conduct on the part of the appellee for a long period of time prior to the
adoption of the Constitution, which course of conduct amounted to a renunciation and abjurement
of his Philippine citizenship, his domicile in the Philippines notwithstanding. Certainly, as to this
particular segment of time in the life of the appellee, in determining whether he had, by his
attitude and conduct, effected a renunciation of his citizenship, we cannot apply, as the trial court
did, the provisions of the Commonwealth Act No. 63 in relation to section 2, Article IV of the
Constitution without giving them retroactive effect, which is not authorized.
As we already stated before, expatriation or renunciation of Philippine citizenship, prior to the
adoption of the Constitution, was possible and could take effect, even in the absence of express
or actual renouncement (Roa vs. Collector of Customs, supra; Lorenzo vs. McCoy, supra).
All these long years appellee has resided has resided in the Philippines, not as a citizen, not with
the sentiments of a citizen, but as a foreigner, with the sentiments of a foreigner. He has lived
here thus, in war and in peace, exempt from the duties and obligations of a citizen. He must have
never dreamed for a moment that he was a Filipino. But now, after such a long period of time, he
claims Philippines citizenship under the Treaty of Paris and the various Acts of the United States
Congress. Citizenship is not just a mere cloak that may he laid aside for years, only to be picked
up for use as occasion suits.
"While domicile, and the intent necessary to establish domicile, are in many cases
determinant of questions of expatriation, they do not govern where statutory conditions of
expatriation exist, such as repatriation by performance of military service or the taking of
an oath of allegiance. Nor do they govern where it appears that aside from then there
exists a course of conduct which involves a renunciation of American citizenship."
(U.S. vs. Longo, 46 F. Supp., 170, 174, emphasis supplied.)
"The question of expatriation, like that of domicile, so far as it depends on the citizen's
will, is to be decided ex facto et animo". (Alsberry vs. Hawkins, 9 Dana, 177, 33 Am.
Dec., 546, 549.)
"Clearly, a move after-thought, created by personal expediency, cannot be enough (to
overcome presumption of expartriation). Such would make American citizenship a mere

travesty instead of the high privilege that it is, and must always remain." (Shaufus vs.
Atty. Gen. 45 F. Supp., 61, 67.)
Appellee's application for naturalization in 1941, and his registration as a Spanish national with
the Spanish Consulate General in Manila, indeed, strengthen our contention that he had, in fact
and intention, divested himself of his Philippine citizenship. His conduct (See Record of appeal
bound by the obligations inherent to the Filipino citizenship he now claims.
We believe, therefore, that appellee had, prior to the adoption of the Constitution, effected
implicitly a renunciation of the Philippine citizenship, if he had that status; and in submitting this
question to this Honorable Court we are confident that it will not lose sight of the superior interest
of the State against claimants for citizenship.
"Citizenship is a high privilege, and when doubts exist concerning a grant of it, generally
at least they should be resolved in favor of the United States and against the claimant"
(U.S. vs. Manzi, 276 U. S., 463, 467; 48 S. Ct., 326, 329; 72 L. ed., 654).

BRIONES, J.:
I concur in this very able dissenting opinion of Mr. Justice Hilado.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-28379

March 27, 1929

THE GOVERNMENT OF THE PHILIPPINE ISLANDS, applicant-appellant,

vs.
CONSORCIA CABANGIS, ET AL., claimants-appellees.
Attorney-General Jaranilla for appellant.
Abad Santos, Camus & Delgado for appellees.
VILLA-REAL, J.:
The Government of the Philippine Islands appeals to this court from the judgment of the Court of First
Instance of Manila in cadastral proceeding No. 373 of the Court of First Instance of Manila, G. L. R. O.
Cadastral Record No. 373, adjudicating the title and decreeing the registration of lots Nos. 36, 39 and 40,
block 3055 of the cadastral survey of the City of Manila in favor of Consuelo, Consorcia, Elvira and
Tomas, surnamed Cabangis, in equal parts, and dismissing the claims presented by the Government of
the Philippine Islands and the City of Manila.
In support of its appeal, the appellant assigns the following alleged errors as committed by the trial court
in its judgment, to wit:
1. The lower court erred in not holding that the lots in question are of the public domain, the same
having been gained from the sea (Manila Bay) by accession, by fillings made by the Bureau of
Public Works and by the construction of the break-water (built by the Bureau of Navigation) near
the mouth of Vitas Estero.
2. The lower court erred in holding that the lots in question formed part of the big parcel of land
belonging to the spouses Maximo Cabangis and Tita Andres, and in holding that these spouses
and their successors in interest have been in continuous, public, peaceful and uninterrupted
possession of said lots up to the time this case came up.
3. The lower court erred in holding that said lots existed before, but that due to the current of the
Pasig River and to the action of the big waves in Manila Bay during the south-west monsoons,
the same disappeared.
4. The lower court erred in adjudicating the registration of the lands in question in the name of the
appellees, and in denying the appellant's motion for a new trial.
A preponderance of the evidence in the record which may properly be taken into consideration in deciding
the case, proves the following facts:

Lots 36, 39 and 40, block 3035 of cadastral proceeding No. 71 of the City of Manila, G. L. R. O. Record
No. 373, were formerly a part of a large parcel of land belonging to the predecessor of the herein
claimants and appellees. From the year 1896 said land began to wear away, due to the action of the
waves of Manila Bay, until the year 1901 when the said lots became completely submerged in water in
ordinary tides, and remained in such a state until 1912 when the Government undertook the dredging of
Vitas Estuary in order to facilitate navigation, depositing all the sand and silt taken from the bed of the
estuary on the low lands which were completely covered with water, surrounding that belonging to the
Philippine Manufacturing Company, thereby slowly and gradually forming the lots, the subject matter of
this proceeding.
Up to the month of February, 1927 nobody had declared lot 39 for the purposes of taxation, and it was
only in the year 1926 that Dr. Pedro Gil, in behalf of the claimants and appellees, declared lot No. 40 for
such purpose.
In view of the facts just stated, as proved by a preponderance of the evidence, the question arises: Who
owns lots 36, 39 and 40 in question?
The claimants-appellees contend that inasmuch as the said lots once formed a part of a large parcel of
land belonging to their predecessors, whom they succeeded, and their immediate predecessor in interest,
Tomas Cabangis, having taken possession thereof as soon as they were reclaimed, giving his permission
to some fishermen to dry their fishing nets and deposit their bancas thereon, said lots belong to them.
Article 339, subsection 1, of the Civil Code, reads:
Article 339. Property of public ownership is
1. That devoted to public use, such as roads, canals, rivers, torrents, ports and bridges
constructed by the State, riverbanks, shorts, roadsteads, and that of a similar character.
xxx

xxx

xxx

Article 1, case 3, of the Law of Waters of August 3, 1866, provides as follows:

ARTICLE 1. The following are part of the national domain open to public use:
xxx

xxx

xxx

3. The Shores. By the shore is understood that space covered and uncovered by the movement
of the tide. Its interior or terrestrial limit is the line reached by the highest equinoctial tides. Where
the tides are not appreciable, the shore begins on the land side at the line reached by the sea
during ordinary storms or tempests.
In the case of Aragon vs. Insular Government (19 Phil., 223), with reference to article 339 of the Civil
Code just quoted, this court said:
We should not be understood, by this decision, to hold that in a case of gradual encroachment or erosion
by the ebb and flow of the tide, private property may not become 'property of public ownership,' as
defined in article 339 of the code, where it appears that the owner has to all intents and purposes
abandoned it and permitted it to be totally destroyed, so as to become a part of the 'playa' (shore of the
seas), 'rada' (roadstead), or the like. . . .
In the Enciclopedia Juridica Espanola, volume XII, page 558, we read the following:

With relative frequency the opposite phenomenon occurs; that is, the sea advances and private
properties are permanently invaded by the waves, and in this case they become part of the shore
or beach. They then pass to the public domain, but the owner thus dispossessed does not retain
any right to the natural products resulting from their new nature; it is a de facto case of eminent
domain, and not subject to indemnity.
Now then , when said land was reclaimed, did the claimants-appellees or their predecessors recover it as
their original property?
As we have seen, the land belonging to the predecessors of the herein claimants-appellees began to
wear way in 1896, owing to the gradual erosion caused by the ebb and flow of the tide, until the year
1901, when the waters of Manila Bay completely submerged a portion of it, included within lots 36, 39 and
40 here in question, remaining thus under water until reclaimed as a result of certain work done by the
Government in 1912. According to the above-cited authorities said portion of land, that is, lots 36, 39 and
40, which was private property, became a part of the public domain. The predecessors of the herein
claimants-appellees could have protected their land by building a retaining wall, with the consent of
competent authority, in 1896 when the waters of the sea began to wear it away, in accordance with the
provisions of Article 29 of the aforecited Law of Waters of August 3, 1866, and their failure to do so until
1901, when a portion of the same became completely covered by said waters, remaining thus submerged
until 1912, constitutes abandonment.
Now then: The lots under discussion having been reclaimed from the seas as a result of certain work
done by the Government, to whom do they belong?
The answer to this question is found in article 5 of the aforementioned Law of Waters, which is as follows:

ART. 5. Lands reclaimed from the sea in consequence of works constructed by the State, or by
the provinces, pueblos or private persons, with proper permission, shall become the property of
the party constructing such works, unless otherwise provided by the terms of the grant of
authority.
The fact that from 1912 some fishermen had been drying their fishing nets and depositing their bancas on
lots 36, 39 and 40, by permission of Tomas Cabangis, does not confer on the latter or his successors the
ownership of said lots, because, as they were converted into public land, no private person could acquire
title thereto except in the form and manner established by the law.
In the case of Buzon vs. Insular Government and City of Manila (13 Phil., 324), cited by the claimantsappellees, this court, admitting the findings and holdings of the lower court, said the following:
If we heed the parol evidence, we find that the seashore was formerly about one
hundred brazas distant from the land in question; that, in the course of time, and by the removal
of a considerable quantity of sand from the shore at the back of the land for the use of the street
car company in filling in Calle Cervantes, the sea water in ordinary tides now covers part of the
land described in the petition.
The fact that certain land, not the bed of a river or of the sea, is covered by sea water during the
period of ordinary high tide, is not a reason established by any law to cause the loss thereof,
especially when, as in the present case, it becomes covered by water owing to circumstances
entirely independent of the will of the owner.

In the case of Director of Lands vs. Aguilar (G.R. No. 22034), 1 also cited by the claimants-appellees,
wherein the Government adduced no evidence in support of its contention, the lower court said in part:
The contention of the claimants Cabangis is to the effect that said lots are a part of the adjoining
land adjudicated to their deceased father, Don Tomas Cabangis, which, for over fifty years had
belonged to their deceased grandmother, Tita Andres, and that, due to certain improvements
made in Manila Bay, the waters of the sea covered a large part of the lots herein claimed.
The Government of the Philippine Islands also claims the ownership of said lots, because, at
ordinary high tide, they are covered by the sea.
Upon petition of the parties, the lower court made an ocular inspection of said lots on September
12, 1923, and on said inspection found some light material houses built thereon, and that on that
occasion the waters of the sea did not reach the aforesaid lots.
From the evidence adduced at the trial of this cause, it may be inferred that Tita Andres, during
her lifetime was the owner of a rather large parcel of land which was adjudicated by a decree to
her son Tomas Cabangis; the lots now in question are contiguous to that land and are covered by
the waters of the sea at extraordinary high tide; some 50 years before the sea did not reach said
strip of land, and on it were constructed, for the most part, light material houses, occupied by the
tenants of Tita Andres, to whom they paid rent. Upon her death, her son Tomas Cabangis
succeeded to the possession, and his children succeeded him, they being the present claimants,
Consuelo, Jesus, Tomas, and Consorcia Cabangis.
The Government of the Philippine Islands did not adduce any evidence in support of its
contention, with the exception of registry record No. 8147, to show that the lots here in question
were not excluded from the application presented in said proceeding.
It will be seen that in the case of Buzon vs. Insular Government and City of Manila, cited above, the rise
of the waters of the sea that covered the lands there in dispute, was due not to the action of the tide but to
the fact that a large quantity of sand was taken from the sea at the side of said land in order to fill in
Cervantes Street, and this court properly held that because of this act, entirely independent of the will of
the owner of said land, the latter could not lose the ownership thereof, and the mere fact that the waters
of the sea covered it as a result of said act, is not sufficient to convert it into public land, especially, as the
land was high and appropriate for building purposes.
In the case of the Director of Lands vs. Aguilar also cited by the claimants-appellees, the Insular
Government did not present any evidence in support of its contention, thus leaving uncontradicted the
evidence adduced by the claimants Aguilar et al., as to the ownership, possession and occupation of said
lots.
In the instant case the evidence shows that from 1896, the waves of Manila Bay had been gradually and
constantly washing away the sand that formed the lots here in question, until 1901, when the sea water
completely covered them, and thus they remained until the year 1912. In the latter year they were
reclaimed from the sea by filling in with sand and silt extracted from the bed of Vitas Estuary when the
Government dredged said estuary in order to facilitate navigation. Neither the herein claimants-appellees
nor their predecessors did anything to prevent their destruction.
In conclusion, then, we hold that the lots in question having disappeared on account of the gradual
erosion due to the ebb and flow of the tide, and having remained in such a state until they were reclaimed
from the sea by the filling in done by the Government, they are public land. (Aragon vs. Insular
Government, 19 Phil., 223; Francisco vs. Government of the Philippine Islands, 28 Phil., 505).

By virtue whereof, the judgment appealed from is reversed and lots Nos. 36, 39 and 40 of cadastral
proceeding No. 373 of the City of Manila are held to be public land belonging to the Government of the
United States under the administration and control of the Government of the Philippine Islands. So
ordered.
Johnson, Street, Malcolm, Ostrand, Johns and Romualdez, JJ., concur.

FIRST DIVISION
[G.R. No. 2394. November 22, 1906. ]
KER & CO., Plaintiffs-Appellants, v. A. R. CAUDEN, Defendant-Appellee.
Pillsbury & Sutro and Kinney, Odlin & Lawrence, for Appellants.
Solicitor-General Araneta, for Appellee.
SYLLABUS

1. LAW OF WATERS. The Law of Waters now in force in these Islands is the law of 1896 and not the
law of 1879 of the Peninsula.
2. ID.; ACCRETION (ALLUVION.) By the provisions of the Law of Waters of 1866 land formed by the
action of the sea is the property of the State.
3. ID.; ID. The law in force prior to 1871 (when the Law of Waters of 1866 took effect here) relating to
land formed by the action of the sea is found in the Partidas.
4. ID.; ID. By the provisions of the Partidas, land formed by the action of the plea is the property of the
State.
5. ID.; ID.; SANGLEY POINT. That part of Sangley Point, in the Province of Cavite, in controvesy in this
action, belonging to the States.
DECISION
WILLARD, J. :
This is an action of ejectment to recover certain land in the Province of Cavite, described in the complaint
as follows:jgc:chanrobles.com.ph
"A parcel of land constituting a part of the tract known as Sangley Point, situated within the municipal
limits of San Roque, Province of Cavite, bounded on the north by Manila Bay; on the east by Manila Bay
and Caacao Bay; on the south by Manila Bay, Caacao Bay, the northeast boundary of the property of
the Veradero of Manila and the prolongation of the said northeast line toward the northwest to Manila Bay;
and on the west by the said northeast boundary of the said Veradero Bay and by the said prolongation of
the same and by Manila Bay."cralaw virtua1aw library
The defendant is in possession of the above-described land as commandant of the Cavite Naval Station
of the United States and sets up title in the United States.
The plaintiff claims title by conveyance made in 1901 and 1902 by the owners of the so-called "Hacienda
de la Estanzuela" or "San Isidro Labrador." The land consists of a sandy point covered with weeds and
brush (about 15 hectares in extent) which has been formed in the last one hundred years by accretion. In
1811 none of the parcel in controversy existed. in 1856 a part of it had been formed, perhaps one-fourth
of the present area.
The foregoing statement is taken from the brief of the appellants. The defendants, in addition to a denial
either direct or upon information and belief, of the facts stated in the complaint, pleaded the statute of
limitations and also the following general defense:jgc:chanrobles.com.ph
"4. Y, por via defensa especial, expone el demandado que dicha porcion de la mencinada Punta es
terreno hecho que ha venido agregandose a la linea de la antigua playa mediante acrecentamientos y
depositos causados por la accion de la mar, y es parte del dominio publico del Gobierno."cralaw
virtua1aw library
At the trial of the case the plaintiffs made the following admission:jgc:chanrobles.com.ph
"Mr. SUTRO. The plaintiffs allege as special defense, in paragraph four of the answer, that said portion of
said land was formed by lands aggregated to the line of shore by deposits and accretion-caused by action
of the sea; and this allegation of special defense is admitted as true by the plaintiffs with the explanation
that we do not determine the date of the commencement of the accretion, which we expect the defendant

shall do."cralaw virtua1aw library

The court below, in view of the admission, decided that the land thus gained from the sea was public
property and belonged to the State, and entered judgment for the defendant, stating that it was not
necessary in the view that it took of the law to determine the other questions in the case, and particularly
the defense of the statute of limitations which had been set up in the answer.
The plaintiffs appellants in this court make a number of assignments of error relating, most of them,
to the admission and rejection of evidence offered on the subject of the statute of limitations. The
appellants say in their brief that:jgc:chanrobles.com.ph
"Of course, if land formed by the action of the sea is ipso facto public domain, the question of prescription
losses its interest and need not be considered."cralaw virtua1aw library
And again:jgc:chanrobles.com.ph
"It is apparent that the vital question in the case is this: Do new lands added by action of the sea to
private estate become, by accession, incorporated in such estate, or are they public domain? This has
been accepted by plaintiffs, defendant, and the trial court as the vital issue in this cause, and its
determination will decide the case."cralaw virtua1aw library
We think that the judgment of the court below should be affirmed upon the ground upon which that court
based its decision, and therefore the only question which we should consider is the one above referred to
as quoted from the appellants brief.
A survey of the hacienda was made in 1811. At that time no part of the land here in question existed. In
1856 another survey was made and from that survey it appears that a part of this land had then been
formed.
The Law of Waters of June 13, 1879, now in force in the Peninsula, was never extended to the
Philippines. By a royal order of August 8, 1866, the Law of Waters of August 3, 1856, was sent here. The
cumplase of the Governor-General was not attached to this royal order until September 21, 1871. it was
published in the "Gaceta de Manila" on September 24, 1871, and the law declared to be in force here.
Doubts having arisen as to whether the law was communicated to the Islands in the proper way, they
were settled by the royal order of April 8, 1873, which was promulgated on July 12, 1873. The law was
declared to be inforce in the Archipelago. As to the land formed since 1871, then, the rights of the parties
must be determined with reference to the Law of Waters of 1866, and the provisions contained in the
present Civil Code. Article 1 of that law 1 is in part as follows:chanrob1es virtual 1aw library
Son del dominio nacional y uso publico: . . .