CITY OF BAGUIO, p

People v Purisima
PEOPLE v. PURISIMA
86 SCRA 543, NOVEMBER 20, 1978
Munoz Palma, J.
Parts of Statute: Preamble
CASE DOCTRINE: The preamble or the whereas
clause of a statute may be referred to determine what
acts fall within the purview of a penal statute
FACTS: Twenty-six Petition for Review were filed by the
People of the Philippines involving three Courts of First
Instance. Before those courts Informations were filed
charging the respective accused with Illegal
possession of deadly weapon in violation of P.D. No. 9.
The mentioned courts dismissed the Informations, on
the common ground, that the Information did not
allege facts which constitute the offense penalized by
P.D. No. 9 because it failed to state one essential
element of the crime which was the possession of
bladed weapon charged was for the purpose of
abetting, or in furtherance of the conditions of
rampant criminality, organized lawlessness, public
order, etc. The respondent Judges ruled that the only
reasonably, logical and valid construction given to P.D.
No. 9 is that carrying of any weapon described in the
Presidential decree only becomes punishable because
of the motivation behind it and not the simple act of
carrying the mentioned. The petitioner contends that
P.D. No. 9 (3) covers one and all situations where a
person carries outside his residence any of the
weapons mentioned or described in the decree
irrespective of motivation intent, or purpose. These
conflicting views arising from its implementation is
then to be settled by searching for and determining
the intent and the spirit of the law through the
preamble of the statute introduced usually by the word
whereas. The petitioner, however, opposes that the
preamble or the whereas clause cannot prevail over
the text itself nor can it enlarge, confer power and
cure inherent defects in the statute as it is not an
essential part of an act.
ISSUE: WON the court should inquire the intent and
the spirit of the decree in the preamble or the
whereas clause?
HELD: The Court ruled that because of the problem of
determining what acts fall within the purview of P.D.
No. 9, it becomes necessary to inquire into the intent
and spirit of the decree which can be found among
others in the preamble or whereas clause which
enumerate the facts or events which justify the
promulgation of the decree and the stiff sanctions
stated therein. With these, the court denies the
petition for review and affirm the dismissal by the
respondent judges of the Information concerned.

Facts:
The ordinance, No. 207, was purportedly enacted by
the Municipal Board on August 14, 1956 and approved
by the City Mayor on the following August 27.
Plaintiffs paid the wharfage charges under protest
since the said ordinance declared void, its
enforcement enjoined in so far as the wharves, docks
and other landing places belonging to the National
Government were concerned.
Appellants have raised some questions of fact, and in
particular point out certain events and circumstances
to show that ordinance No. 207 was not and could not
have been enacted.
The respondent cited section 17 (w) of the charter of
the City of Cebu which gives the Municipal board the
power to xxx to fix the charges to be paid by all
watercrafts landing at or using public wharves, docks,
levees, or landing places.
The lower court ruled upholding appellees' contention
in this respect, that in using the terms "public
wharves, docks, levees, or landing places," the
legislature made no distinction between those owned
by the National Government and those owned by the
City of Cebu and that consequently both fall within the
scope of the power granted.
Issue:
WON under its charter, Commonwealth Act No. 58, the
City of Cebu may provide by ordinance for the
collection of wharfage from shipping concerns whose
vessels dock at the public wharves of piers located in
said city but owned by the National Government?
Held:
NO. City of Cebu may not provide by ordinance for the
collection of wharfage from shipping concerns whose
vessels, docks, at the public wharves of piers located
in said city but owned by the national government for
the reason that under Sec 17(w) of the Charter of
Cebu as cited by the respondent in consonance with
its preceding section, would refer only to those public
wharves or landing places owned by the city of Cebu
and not those owned by the National Government
under the exclusive supervision of the Bureau of
Customs, according to sec 1142 of the Revised
Administrative Code. Legislative intent must be
ascertained from a consideration of the statute as a
whole and not of an isolated part or a particular
provision alone. This is a cardinal rule of statutory
construction.
IN VIEW OF THE FOREGOING, the judgment appealed
from is reversed; Ordinance No. 207 of the City of
Cebu is declared null and void, and appellees are
ordered to refund to appellants all amounts collected
thereunder and to refrain from making such collection.
Costs against appellees.
Florentino v PNB
Florentino v. Philippine National Bank
98 Phil. 959

Aboitiz v City of Cebu

ABOITIZ SHIPPING
CORPORATION; plaintiffs-appellants,
vs.
THE CITY OF CEBU;

Intrinsic Aid: Punctuation Marks

JUGO, J.:

defendants-appellees.
G.R. No. L14526

Facts: The petitioners and appellants filed a petition

for mandamus against Philippine National Bank to

compel it to accept the backpay certificate of

petitioner Marcelino B. Florentino to pay an
indebtedness secured by real estate mortgage plus
interest. Petitioner is a holder of Backpay
Acknowledgment by virtue of Republic Act No. 897.
Petitioners offered to pay their loan with the
respondent bank with their backpay certificate, but the
respondent bank refused to accept the latter's
backpay certificate. Under section 2 of Republic Act
No. 879, respondent contends that the qualifying
clause refers to all the antecedents, whereas the
appellant's contention is that it refers only to the last
antecedent.
Issue: Whether or not the clause who may be willing
to accept the same for settlement refers to all
antecedents mentioned in the last sentence of section
2 of Republic Act No. 879.
Ruling: Grammatically, the qualifying clause refers
only to the last antecedent; that is, "any citizen of the
Philippines or any association or corporation organized
under the laws of the Philippines." It should be noted
that there is a comma before the words "or to any
citizen, etc.," which separates said phrase from the
preceding ones. But even disregarding the
grammatical construction, as done by the appellee,
still there are cogent and powerful reasons why the
qualifying clause should be limited to the last
antecedent. In the first place, to make the acceptance
of the backpay certificates obligatory upon any citizen,
association, or corporation, which are not government
entities or owned or controlled by the government,
would render section 2 of Republic Act No. 897
unconstitutional, for it would amount to an impairment
of the obligation of contracts by compelling private
creditors to accept a sort of promissory note payable
within ten years with interest at a rate very much
lower than the current or even the legal one.
N.B.:
The legal provision involved is section 2 of Republic
Act No. 879, which provides:
SEC. 2. The Treasurer of the Philippines shall, upon
application of all persons specified in section one
hereof and within one year from the approval of this
Act, and under such rules and regulations as may be
promulgated by the Secretary of Finance, acknowledge
and file requests for the recognition of the right of the
salaries or wages as provided in section one hereof,
and notice of such acknowledgment shall be issued to
the applicant which shall state the total amount of
such salaries or wages due the applicant, and certify
that it shall be redeemed by the Government of the
Philippines within ten years from the date of their
issuance without interest: Provided, That upon
application and subject to such rules and regulations
as may be approved by the Secretary of Finance a
certificate of indebtedness may be issued by the
Treasurer of the Philippines covering the whole or a
part of the total salaries or wages the right to which
has been duly acknowledged and recognized, provided
that the face value of such certificate of indebtedness
shall not exceed the amount that the applicant may
need for the payment of (1) obligations subsisting at
the time of the approval of this amendatory Act for
which the applicant may directly be liable to the
Government or to any of its branches or

instrumentalities, or the corporations owned or control

by the Government, or to any citizen of the Philippines,
or to any association or corporation organized under
the laws of the Philippines, who may be willing to
accept the same for such settlement.

Unabia v. City Mayor

UNABIA VS CITY MAYOR ET AL
L-8759
May 25, 1956
Case doctrine: CONSTRUCTION Use of capitalization
FACTS: The case is an appeal from a judgment of the
Court of First Instance of Cebu ordering respondents to
reinstate petitioner Severino Unabia as foreman of the
Garbage Disposal Unit of the Office of the City
Engineer of Cebu City (originally under the City Health
Department), who was removed from his position by
the City Mayor and was replaced by two other men
(Perfecto Abellana, Pedro Gonzales). The Court of First
Instance held that the petitioner is a person in the
Philippine Civil Service, pertaining to the unclassified
service (section 670, Revised Administrative Code, as
amended) and that his removal is a violation of
Section 694 of the Revised Administrative Code and
section 4 of Art.XII of the Constitution. Respondents
however contended that the use of capital letters in
the words Civil Service in section 1 and 4 of Article
XII of the Constitution and the use of small letters for
the same words as is used in section 670 of the
Revised Administrative Code indicates that only those
pertaining to the classified service are protected in the
above-mentioned sections of the Constitution.
ISSUE: Whether or not those in the unclassified service
are protected in the pertained sections of the Revised
Administrative Code and the Constitution
RULING: Yes- The use of capital letters in Civil
Service found in the Constitution is used to indicate
the group. No capitals are used in the similar
provisions of the Code to indicate the system. There is
no reason for excluding persons in the unclassified
service from the benefits extended to those belonging
in the classified service; they both belong to the same
Civil Service and should therefore be accorded same
benefits. The distinction between classified and
unclassified is the nature of their work.

In re Estate of Johnson G.R. No. 12767 (November 16,

1918)
Facts: Petitioner was a native of Sweden and a
naturalized citizen of the United states but died and
left a will in Manila. Section 636 of the Code of the Civil
Procedure states that "Will made here by an alien- will
made within the Philippine Islands by a citizen or
subject of another state or country, which is executed
in accordance with the law of the state or country of
which he is a citizen or subject, and which might be
proved, allowed by the law of his own state or country,

may be proved, allowed and recorded in the Philippine

Islands and shall have the same effect as if executed
according to the laws of these Islands." The will of
Johnson was probated and allowed in the lower court,
but Petitioner contends that Section 636 is applicable
only to wills of aliens; and in this connection, attention
is directed to the fact that the epigraph of this section
speaks only of the will made here by an alien and to
further fact that the word "state" in the body of the
section is not capitalized.
Issue: Whether or not the will of Petitioner, a citizen of
the U.S. and therefore an alien, is covered by Section
636.
Held: The fact that the words "state" and "country"
are not capitalized does not mean that the. United
State is excluded from the phrase "another state or
country". It is a rule of hermeneutics that punctuation
and capitalization are aids of low degree interpreting
the language of a statute and can never control
against the intelligible meaning of the written words.
The epigraph, or heading, of a section being nothing
more than a convenient index to the contents of the
provision, cannot have the effect of limiting the
operative words contained in the body of the text.
Petitioner, being a US citizen, thus an alien, is covered
by Section 636. The will duly probated.
People v Abilang

Traders Insurance & Surety v Golangco

Case Title: TRADERS INSURANCE AND SURETY CO. vs
JUAN GOLANGCO Y OTRA
GR No.: L-6442
Date: September 21, 1954
Case Doctrine: Lingual Text
FACTS: Juan Golangco, respondent, acquired an
insurance policy worth P10,000 from Traders Insurance
and Surety Co. for his building (No. 34 Plaza, Sta.
Cruz, Manila). Two months later, the building caught
fire and Golangco went to Traders Insurance and
Surety Co. for the payment of the insurance amount
which was denied. Golangco filed a lawsuit and won.
Traders Insurance and Surety Co. filed an appeal,
arguing that the Court of Appeals erred in passing
judgment without a full conclusion made from all
points raised (without findings of fact regarding
Exhibits 10 -H and 10 I).
Traders Insurance and Surety Co. cited Article 33 of
Law No. 296 which in English reads:
Every decision of the Court of Appeals shall contain
complete findings of fact on all issues properly raised
before it.
But in Spanish it reads:
Any decision of the Court of Appeals will contain a full
statement of the facts of all matters arising before it.

ISSUE: WON the court misinterpreted Law No. 296.

RULING: Nopetition denied. The Court held that the
English version shall be followed and not the poorly
translated Spanish version which Traders Insurance
and Surety Co. presented. Since Law No. 296 was
approved in English, the English text shall govern over
the Spanish translation.

Manila Lodge v Court of Appeals

Manila Lodge v CA
September 30, 1976
G.R. No. L-41001
Case Doctrine: Construction to avoid surplusage
FACTS:
The Philippine Commission enacted Act No. 1306
which authorized the City of Manila to reclaim a
portion of Manila Bay. The reclaimed area was to form
part of the Luneta extension. The act provided that the
reclaimed area shall be the property of the City of
Manila, and the city is authorized to set aside a tract of
the reclaimed land for a hotel site and to lease or to
sell the same. Later, the City of Manila conveyed a
portion of the reclaimed area to Petitioner. Then
Petitioner sold the land, together with all the
improvements, to the Tarlac Development Corporation
(TDC).
ISSUE: Whether the reclaimed land is patrimonial or
public dominion.
RULING: to say that the land is patrimonial will render
nugatory and a surplusage the phrase of the law to the
effect that the City of Manila is hereby authorized to
lease or sell.
A sale of public dominion needs a legislative
authorization, while a patrimonial land does not.
Adong v Cheong Seng Gee
Philippine Sugar Central Agency v Collector of Customs
Estrada v Sandiganbayan
Collector of Internal Revenue v Zamora
COLLECTOR OF INTERNAL REVENUE ET AL VS ZAMORA
ET AL
GR NOS. 15280, 15281, 15289, 15290 May 31, 1963
Legislative History; History of the Statute
PAREDES, J:
FACTS: Mariano Zamora, owner of the Bay View Hotel
Manila and Farmacia Zamora, Manila, filed his income
tax returns for the years 1951 and 1952. The Collector
of Internal Revenue found that he failed to file his
return of the capital gains derived from the sale of a
certain real properties and claimed deductions which
were not allowable. The Collector required him to pay
the sums of P 43,758.50 and P 7,625.00 as deficiency
income tax for the years 1951 and 1952 respectively.
On appeal by Zamora, the CTA modified the decision

appealed from and ordered him to pay the reduced

total sum of P 30,258.00 plus the corresponding
surcharges and interest in case of delinquency.
Mariano Zamora failed to obtain a reconsideration,
hence, he appealed alleging that CTA erred in
disallowing 3 % per annum, at the rate of
depreciation of the Bay View Hotel Building.
ISSUE: WON the CTA erred in computing the taxes
due for payment by Mariano Zamora
HELD: No. As the lower court based its findings on
Bulletin F, petitioner Zamora, argues that the same
should have been first proved as a law, to be subject
to judicial notice. Bulletin F, is a publication of the US
Federal Internal Revenue Service, which was made
after a study of the lives of the properties. In the words
of the lower court: "It contains the list of depreciable
assets, the estimated average useful lives thereof and
the rates of depreciation allowable for each kind of
property. It is true that Bulletin F has no binding force,
but it has a strong persuasive effect considering that
the same has been the result of scientific studies and
observation for a long period in the United States after
whose Income Tax Law ours is patterned." Verily,
courts are permitted to look into and investigate the
antecedents or the legislative history of the statutes
involved. Zamora also contends that his basis for
applying the 3-% rate is the testimony of its witness
Mariano Katipunan, who cited a book entitled "Hotel
Management Principles and Practice" by Lucius
Boomer, President, Hotel Waldorf Astoria Corporation.
As well commented by the Solicitor General, "while the
petitioner would deny us the right to use Bulletin F, he
would insist on using as authority, a book in Hotel
management written by a man who knew more about
hotels than about taxation. All that the witness did
(Katipunan) . . . is to read excerpts from the said book,
which admittedly were based on the decision of the
U.S. Tax Courts, made in 1928". In view hereof, We
hold that the 2-% rate of depreciation of the Bay
View Hotel building, is approximately correct.
Casco Phil. Chemical Co. v Gimenez
CASCO PHILIPPINES CHEMICAL CO., INC. v. HON.
PEDRO GIMENEZ, et al.
G.R. No. L-17931 ; 28 February 1963
Concepcion, J.
Facts: Pursuant to the provisions of Republic Act No.
2609, otherwise known as the Foreign Exchange
Margin Fee Law, the Central Bank of the Philippines
issued its Circular No. 95. fixing a uniform margin fee
of 25% on foreign exchange transactions. The Bank
later promulgated a memorandum establishing the
procedure for applications for exemption from the
payment of said fee, as provided in said Republic Act
No. 2609. Petitioner Casco Philippine Chemical Co.,
Inc. bought foreign exchange for the importation of
urea and formaldehyde which are the main raw
materials in the production of resin glues and paid
therefor the margin fee aggregating P33,765.42. In
May, 1960, petitioner made another purchase of
foreign exchange and paid the sum of P6,345.72 as
margin fee therefor. Prior thereto, petitioner had
sought the refund of the first sum relying upon
Resolution No. 1529 of the Monetary Board of said
Bank, dated November 3, 1959, declaring that the

separate importation of urea and formaldehyde is

exempt from said fee. Soon after the last importation
of these products, petitioner made a similar request
for refund of the sum of P6,345.72 paid as margin fee
therefor. Although the Central Bank issued the
corresponding margin fee vouchers for the refund of
said amounts, the Auditor of the Bank refused to pass
in audit and approve said vouchers, upon the ground
that the exemption granted by the Monetary Board for
petitioner's separate importations of urea and
formaldehyde is not in accord with the provisions of
section 2, paragraph XVIII of Republic Act No. 2609.
The Auditor General subsequently affirmed said action
of the Auditor of the Bank. Petitioner contends,
however, that the bill approved in Congress contained
the copulative conjunction "and" between the terms
"urea" and "formaldehyde", and that the members of
Congress intended to exempt "urea" and
"formaldehyde" separately as essential elements in
the manufacture of the synthetic resin glue called
"urea" formaldehyde", not the latter as a finished
product, citing in support of this view the statements
made on the floor of the Senate, during the
consideration of the bill before said House, by
members thereof.
Issue: Whether or not the contention of the petitioner
regarding that the law is not imposed on finished
product?
Resolution: But, said individual statements do not
necessarily reflect the view of the Senate. Much less
do they indicate the intent of the House of
Representatives. Furthermore, it is well settled that the
enrolled bill which uses the term "urea
formaldehyde" instead of "urea and formaldehyde"
is conclusive upon the courts as regards the tenor of
the measure passed by Congress and approved by the
President.
Escalante v Santos
People v Manantan
People (plaintiff)
v.
Manantan (defendant)
115 Phil. 57
August 30, 1962
Case Doctrine: Prior law from which statute is based
FACTS:
This resolution refers to a motion for
consideration filed by the counsel for defendant
appellee, Guillermo Manantan.
The defendant was charged with the violation
of Section 54 of the Revised Election Code. The
defendant questioned the ruling of the court that the
effect of remanding the case to the lower court for trial
on the merits is to place him twice in jeopardy of being
tried for the same offense. To support his claim, he
cites the case of People v Labatete.
The Court denied the defendants plea that
double jeopardy should be rejected because the
defendant neither raised the issue of double jeopardy
by way of resisting the appeal of the state nor argued
in his brief the said plea. He is deemed to have waived
this defense. This is in accord with this Courts ruling

in the cases of People vs Rosalina Casiano and People

vs. Pinulia
ISSUE:
Whether or not prior law from which statue is based
can be an aid of clarifying ambiguities?
RULING:
Yes. Courts are permitted to look to prior laws
on the same subject and to investigate the
antecedents of the statute involved. This rule is
applicable in the interpretation of codes, revised, or
compiled statutes, for the prior laws which have been
codified, compiled or revised will show the legislative
history that will clarify the intent of the law or shed
light on the meaning and scope of the codified or
revised statute.

respondent officer or employee is exonerated, she

shall be restored to his position with full pay for the
period of suspension, was amended by deleting the
provision regarding the payment of salaries during
suspension, and that said amendment is for the
purpose of disallowing the payment of salaries for the
period of suspension. The court added that this
amendment be deletion should be given construction
different from the previous amendment.
WHEREFORE, the decision, dated September 3, 1996,
as amended by the resolutions, dated July 15, 1997
and October 6, 1997, of the Court of Appeals, is
hereby AFFIRMED with the MODIFICATION that the
award of salaries to private respondents shall be
computed from the time of their dismissal/suspension
by the Department of Education, Culture, and Sports
until their actual reinstatement, for a period not
exceeding five years.

Gloria v Court of Appeals

HON. RICARDO T. GLORIA, in his capacity as Secretary
of the Department of Education, Culture, and Sports,
petitioner,
vs.
COURT OF APPEALS, AMPARO A. ABAD, VIRGILIA M.
BANDIGAS, ELIZABETH A. SOMEBANG and NICANOR
MARGALLO, respondents.
G.R. No. 131012 April 21, 1999
Doctrine: Change in Phraseology by Amendments,
Amendments by Deletion

FACTS: Private respondents are public school teachers.

On various dates in September and October 1990,
during the teachers' strikes, they did not report for
work. For this reason, they were administratively
charged with (1) grave misconduct, (2) gross neglect
of duty, (3) gross violation of Civil Service Law Rules
and Regulations and reasonable office regulations. (4)
refusal to perform official duty, (5) gross
insubordination, (6) conduct prejudicial to the best
interest of the service, and (7) absence without leave
(AWOL), and placed under preventive suspension. The
investigation was concluded before the lapse of 90-day
suspension and private respondents were found guilty
as charged. Respondent Nicanor Margallo was ordered
dismissed from the service effective October 29, 1990,
while respondents Amparo Abad, Virgilia Bandigas,
and Elizabeth Somebang were ordered suspended for
six months effective December 4, 1990. Respondents
sought for their rights for their salaries during
suspension since they did not participate in massive
strike, although reprimanded for being absent without
leave.

ISSUES: Whether or not public teachers, who has been

preventively suspended pending investigation of the
administrative charges against him is entitled for
salary and benefits during such preventive
suspension?
HELD:
The court stated that Sec. 35 of the old Service Act of
1958 (R.A. 2260) which then provided that if the

Republic v Meralco
Republic vs. Meralco
GR 141314, 15 November 2002;
Third Divsiion,
Puno (J)
Facts: On 23 December 1993, Meralco filed with the
Energy Regulatory Board (ERB) an application for the
revision of its rate schedules. On 28 January 1994, the
ERB issued an order granting a provisional increase of
P0.184/kwh subject to the condition that in event that
the board finds that Meralco is entitled to a lesser
increase in rates, all excess amounts collected shall be
refunded or credited to its customers. Subsequently,
ERB rendered its decision adopting the audit of the
Commission on Audit (COA) and authorized Meralco to
implement a rate adjustment of P0.017/kwh, but
ordered the refund of the excess amount of
P0.167/kwh collected from the billing cycles of
February 1994 to February 1997, holding that income
tax should not be treated as operating expense, and
applying the net average investment method in the
computation of the rate base. On appeal, the Court of
Appeals set aside the ERB decision insofar as it
directed the reduction of the rates by P0.167/kwh and
the refund to Meralcos customers. Motions for
reconsideration were denied. Hence, the petition
before the Supreme Court.
Issue: Whether the rates are just and reasonable.
Held: The ERB has the power to fix rates to be charged
by public utilities involved in the distribution of
electricity, under Executive Order 172. What is just,
reasonable rate is a question of fact calling for the
exercise of discretion, good sense, and a fair,
enlightened and independent judgment. In
determining the just and reasonable rates to be
charged by a public utility, the regulating agency must
consider the rate of return, the rate base, and the
return itself or the computed revenue to be earned by
the public utility based on the rate of return and rate
base. Aside from the financial condition of the public
utility, particular reasons involved for the request of
the rate increase, the quality of the services rendered
by the public utility, the existence of competition, the
element of risk or hazard involved in the investment,
the capacity of consumers, etc. should be considered

for the purpose of rate regulation. Herein, the factual

findings of the administrative body should be accorded
great respect, even finality, if supported by substantial
evidence. To the extent that the agency has not been
arbitrary or capricious in the exercise of its powers, the
courts should not interfere.
Vera V Cueva
Vera V Cueva
May 31, 1979
L-33693-94
Case Doctrine: Weighed Accorded To Contemporary
Construction
FACTS:
Petition for certiorari with preliminary injunction to
review the judgment rendered by the Court of First
Instance of Manila, perpetually restraining the
defendant, Commission on Internal Revenue from
refraining plaintiffs now private respondents (engaged
in manufacture, distribution, and sale of filled milk in
the Philippines) to print out the labels of their filled
milk product the words this milk is not suitable for
nourishment for infants less than one year age.
Order from the Commission on Internal Revenue
requiring the plaintiffs-private respondents to
withdraw from the market all of their filled milk
products which do not bear the inscription required by
Section 169 of Tax Code within 15 days from the
receipt of order.
ISSUE:
Whether or not the private respondents be charged
with penalty according to Section 169 released by
Commission on Internal Revenue
HELD:
The decision is hereby affirmed. Section 169
Inscription to be placed on Skimmed Milk is not to be
applied to filled milk, the use of specific qualifying
terms skimmed milk in the head note and
condensed skimmed milk in the text of the cited
section, would restrict the scope of the general clause
all milk in whatever form, in other words, the general
clause is restricted by specific term skimmed milk
under the familiar rule of ejusdem generis that general
and unlimited terms are restricted and limited by
particular terms they follow in the statute.
The difference between skimmed milk and filled milk,
the former, the fatty part has been released, the latter,
the fatty part has been released but substitute with
coconut or corn oil or both, it cannot be safely
assumed that 169 applies to both.
Chartered Bank Employees' Association v Ople
CASE DOCTRINE: (Weight Accorded to Contemporary
Construction)
FACTS:
The petitioner filed a petition for certiorari seeking to
annul the decision of the respondent Secretary, now
Minister of Labor which denied the petitioner's claim
for holiday pay and its claim for premium and overtime
pay differentials.

On May 20, 1975, the Chartered Bank Employees

Association, in representation of its monthly paid
employees/members, instituted a complaint with the
Regional Office No. IV, Department of Labor, now
Ministry of Labor and Employment (MOLE) against
private respondent Chartered Bank, for the payment of
ten (10) unworked legal holidays, as well as for
premium and overtime differentials for worked legal
holidays from November 1, 1974.
The Minister of Labor dismissed the Chartered Bank
Employees Associations claim for lack of merit basing
its decision on Section 2, Rule IV, Book III of the
integrated Rules and Policy Instruction No. 9.
ISSUE:
Whether or not the Secretary of Labor erred and acted
contrary to law in promulgating Sec. 2, Rule IV, Book III
of the Integrated Rules and Policy Instruction No. 9.
HELD:
While it is true that the minister has the authority in
the performance of his duty to promulgate rules and
regulations to implement, construe and clarify the
Labor Code, such power is limited by provisions of the
statute sought to be implemented, construed or
clarified.
Obviously, The Secretary (Ministry) of Labor had
exceeded his statutory authority granted by Article 5
of the Labor Code authorizing him to promulgate the
necessary implementing rules and regulations.
Note: The rule of statutory construction that when the
language of the law is clear and unequivocal the law
must be taken to mean exactly what it says.
Addition Information:

Sec. 2. Status of employees paid by the

month. Employees who are uniformly paid by the
month, irrespective of the number of working days
therein, with a salary of not less than the statutory or
established minimum wage shall be presumed to be
paid for all days in the month whether worked or not.

POLICY INSTRUCTION NO. 9

TO: All Regional Directors

SUBJECT: PAID LEGAL HOLIDAYS
The rules implementing PD 850 have clarified the
policy in the implementation of the ten (10) paid legal
holidays. Before PD 850, the number of working days a
year in a firm was considered important in determining
entitlement to the benefit. Thus, where an employee
was working for at least 313 days, he was considered
definitely already paid. If he was working for less than
313, there was no certainty whether the ten (10) paid
legal holidays were already paid to him or not.
The ten (10) paid legal holidays law, to start with, is
intended to benefit principally daily employees. In the
case of monthly, only those whose monthly salary did
not yet include payment for the ten (10) paid legal
holidays are entitled to the benefit.

Under the rules implementing PD 850, this policy has

been fully clarified to eliminate controversies on the
entitlement of monthly paid employees. The new
determining rule is this: 'If the monthly paid employee
is receiving not less than P240, the maximum monthly
minimum wage, and his monthly pay is uniform from
January to December, he is presumed to be already
paid the ten (10) paid legal holidays. However, if
deductions are made from his monthly salary on
account of holidays in months where they occur, then
he is still entitled to the ten (10) paid legal holidays.
These new interpretations must be uniformly and
consistently upheld.
This issuance shall take effect immediately.

Commissioner of Internal Revenue v American Express

COMMISSIONER OF INTERNAL REVENUE VS AMERICAN
EXPRESS
G.R. No. 152609
June 29, 2005
Doctrine: Contemporary Construction: Reenactment
FACTS: Respondent, a VAT taxpayer, is the Philippine
Branch of AMEX USA and was tasked with servicing a
unit of AMEX-Hongkong Branch and facilitating the
collections of AMEX-HK receivables from card members
situated in the Philippines and payment to service
establishments in the Philippines.
It filed with BIR a letter-request for the refund of its
1997 excess input taxes, citing as basis Section 110B
of the 1997 Tax Code, which held that xxx Any input
tax attributable to the purchase of capital goods or to
zero-rated sales by a VAT-registered person may at his
option be refunded or credited against other internal
revenue taxes, subject to the provisions of Section
112.
In addition, respondent relied on VAT Ruling No. 08089, which read, In Reply, please be informed that, as
a VAT registered entity whose service is paid for in
acceptable foreign currency which is remitted inwardly
to the Philippine and accounted for in accordance with
the rules and regulations of the Central Bank of the
Philippines, your service income is automatically zero
rated xxx
Petitioner claimed, among others, that the claim for
refund should be construed strictly against the
claimant as they partake of the nature of tax
exemption.
The Court of Tax Appeals (CTA) rendered a decision in
favor of respondent, holding that its services are
subject to zero-rate. The Court of Appeals (CA)
affirmed this decision and further held that
respondents services were services other than the
processing, manufacturing or repackaging of goods for
persons doing business outside the Philippines and
paid for in acceptable foreign currency and accounted
for in accordance with the rules and regulations of BSP.
ISSUE: WON the American Express- Philippines is
entitled to tax refund

HELD: YES. The Supreme Court held that upon the

enactment of RA 8424, which substantially carries over
the particular provisions on zero rating of services
under Section 102(b) of the Tax Code which states that
"(b) Transactions subject to zero percent (0%) rate. -The following services performed in the Philippines by
VAT-registered persons shall be subject to zero percent
(0%) rate:
(1) Processing, manufacturing or repacking goods for
other persons doing business outside the Philippines
which goods are subsequently exported, where the
services are paid for in acceptable foreign currency
and accounted for in accordance with the rules and
regulations of the Bangko Sentral ng Pilipinas (BSP);
(2) Services other than those mentioned in the
preceding subparagraph, the consideration for which is
paid for in acceptable foreign currency and accounted
for in accordance with the rules and regulations of the
BSP;"
xxxxxxxxx
the principle of legislative approval of administrative
interpretation by reenactment clearly obtains. This
principle means that "the reenactment of a statute
substantially unchanged is persuasive indication of the
adoption by Congress of a prior executive
construction.
The legislature is presumed to have reenacted the law
with full knowledge of the contents of the revenue
regulations then in force regarding the VAT, and to
have approved or confirmed them because they would
carry out the legislative purpose. This particular
provision is re-enforced, "When a statute is susceptible
of the meaning placed upon it by a ruling of the
government agency charged with its enforcement and
the legislature thereafter reenacts the provisions
without substantial change, such action is to some
extent confirmatory that the ruling carries out the
legislative purpose."
Having resolved that transactions of respondent are
zero-rated, the Court upholds the formers entitlement
to the refund as determined by the appellate court.
Moreover, there is no conflict between the decisions of
the CTA and CA. This Court respects the findings and
conclusions of a specialized court like the CTA which,
by the nature of its functions, is dedicated exclusively
to the study and consideration of tax cases and has
necessarily developed an expertise on the subject."
Furthermore, under a zero-rating scheme, the sale or
exchange of a particular service is completely freed
from the VAT, because the seller is entitled to recover,
by way of a refund or as an input tax credit, the tax
that is included in the cost of purchases attributable to
the sale or exchange. "The tax paid or withheld is not
deducted from the tax base." Having been applied for
within the reglementary period, respondents refund is
in order.

Associated Sugar Inc. v Commissioner of Customs

Associated Sugar Inc. v Commissioner of Customs

GR No.
Date
Case Doctrine:
Facts:
This case is about the legality of wharfage dues in the
sum of 904,236.38 collected by the Commissioner of
Customs from the five petitions in connection with
their exportation of sugar which was shipped from two
private wharves.
The petitioner assail the wharfage fees in question on
the theory that wharfage is a charge or rent for the
use of a wharf or the use of government facilities in a
port. Since they used private wharves and did not use
any government facilities, they contend that they
should not be held liable for wharfage dues.
Issue/s
W/N the definition of wharfage by the petitioner is
valid.
Ruling
The theory of the petitioner is not tenable under under
sections 2801 and 2802 of the Tariff and Custom Code,
R.A. 1937, PD 231 as amended by PD 426, which
provides that wharfage is a fee assessed against the
cargo of a vessel engaged in a foreign or domestic
trade based on the quantity, weight or measure
received and/or discharged by such vessel.
It can be inferred that wharfage dues can be collected
even if no wharf is used in the loading or unloading of
exported or imported cargoes. Therefore, the court
ruled that the petitioner is entitled for the said dues.
Tung Chin Hui v Rodriguez
Tung Chin Hui vs Rodriguez
GR No 137571
September 21, 2000
Case Doctrine: Stare Decisis
FACTS: The petitioner, a Taiwanese citizen, was
arrested after bring found guilty of possessing a
tampered passport earlier canceled by the Taiwanese
authority who ordered his summary deportation.
Petitioner filed before the RTC that a petition for
habeas corpus on the ground that his detention was
illegal. His petition was granted. Respondent filed a
motion for reconsideration. Petitioner then filed an
opposition claiming that the Notice had been filed
beyond the 48-hour reglementary period for filing
appeals in habeas corpus cases as prescribed by the
pre-1997 Rules of Court. RTC rejected petitioners
contention and granted due course to the Notice of
Appeal. A motion for reconsideration was filed but was
also rejected. Hence, the petition.
ISSUE: Whether or not the notice had been filed
beyond the 48 hour reglementary period for filing
appeals in habeas corpus cases prescribed by the pre1997 Rules of Court
RULING: No.

Petitioner urges that the court apply precedents that

held the 48 hour period for perfecting an appeal was
mandatory and jurisdictional. The principled cited by
the petitioner is stare decisis, et non quieta movere,
which means when the court has once laid down a
principle of law as applicable to a certain state of
facts, it will adhere to that principle and apply it to all
future cases where the facts are substantially the
same.
In the present case, all the precedent cases had been
resolved under the pre-1997 Rules of Court. Stare
decisis cannot compel this court to apply to the
present case alleged precedents decided during the
regime of the pre-1997 Rules of Court. The cited cases
applied a specific provision of the Rules of Court in
effect at that time. But because that provision had
already been repealed when the facts under present
consideration occurred, the court can no longer rely on
those cases.
Bustamante v NLRC
GR number:
111651
Date:
November 28, 1996
Case doctrine: Literal meaning or plain-meaning rule
if statute is clear, plain and free from ambiguity, it
must be given its literal meaning and applied without
attempted interpretation.
FACTS:
The facts are not in dispute. Respondent company is
engaged in the business of producing high grade
bananas in its plantation in Davao del Norte.
Petitioners Paulino Bantayan, Fernando Bustamante,
Mario Sumonod and Osmalik Bustamante were
employed as laborers and harvesters while petitioner
Sabu Lamaran was employed as a laborer and sprayer
in respondent company's plantation. All the petitioners
signed contracts of employment for a period of six (6)
months from 2 January 1990 to 2 July 1990, but they
had started working sometime in September 1989.
Previously, they were hired to do the same work for
periods lasting a month or more, from 1985 to 1989.
Before the contracts of employment expired on 2 July
1990, petitioners' employments were terminated on
25 June 1990 on the ground of poor performance on
account of age, as not one of them was allegedly
below forty (40) years old. In accordance with Republic
Act No. 6715, an illegally dismissed employee is
entitled to his full backwages from the time his
compensation was withheld from him (which, as a rule,
is from the time of his illegal dismissal) up to the time
of his actual reinstatement.
ISSUE:
Whether or not in computing the amount of
backwages, an illegally dismissed employee be
entitled until his actual reinstatement.
HELD:
YES. The provision calling for "full backwages" to
illegally dismissed employees is clear, plain and free
from ambiguity and, therefore, must be applied
without attempted or strained interpretation. Index
animi sermo est. Therefore, in accordance with R.A No.
6715, petitioners are entitled to their full backwages,
inclusive of allowances and other benefits or their
monetary equivalent, from the time their actual

compensation was withheld from them up to the time

of their actual reinstatement.

Espiritu vs. Cipriano

GR No. L-32743, 55 SCRA 5333
February 15, 1974
Doctrine: Literal Meaning or Plain Meaning Rule
Facts:
Herein, the plaintiffs were the owners of the property
in question, leased to the defendants since 1952. In
January, 1969, the lease was converted to a month-tomonth basis, and the plaintiffs increased the rent to
P30.00 a month. Since then, the defendants have not
paid the rent. This is why Espiritu, et. al, raised the
complaint against the defendants Cipriano, et. al. to
the Municipal court of Pasig, Rizal.
Herein, the defendants moved to dismiss the plaintiffs
complaint by invoking the prohibitory provision of R.A.
6126 which states that there should be no increase of
rent during a one year period starting from March 30,
1970, where the rent does not exceed P300.00.
However, the increase of rent happened a year before
the enactment of the statute.
Issue:
Whether or not R.A. 6126 will have retroactive effect at
the case at bar.
Rulings:
According to Article 4 of the Civil Code, no law shall be
given retroactive effect unless the contrary is
provided. R.A. 6126 is not applicable at the case at
bar.
It is a well-established rule of statutory construction
that if the language of the law is plain, clear, and free
from ambiguity, it must be given its literal
interpretation. The principle of verba legis or the plain
meaning rule was applied.
WHEREFORE, the assailed orders of August 4 and
October 16, 1970, are hereby nullified and set aside.
The court a quo shall proceed with the prompt
disposition of Civil Case No. 338-M (12285) on the
merits in accordance with Republic Act 6031 if
applicable, otherwise under the prevailing procedure
prescribed by the Rules of Court.
Costs against respondent.

National Federation of Labor v NLRC

[G.R. No. 127718. March 2, 2000]
Case Doctrine: Literal Meaning/Verba Legis/Plain
Meaning Rule
FACTS
Petitioners are employees of the Patalon Coconut
Estate in Zamboanga. With the advent of the RA No.
6657 or the Comprehensive Agrarian Reform Law, the
government sought the compulsory acquisition of the
land for agrarian reform. Because of this, the private
respondents who are owners of the estate decided to
shut down its operation. Petitioners did not receive any

separation pay. Now, the petitioners pray, with the

representation of their labor group, claiming that they
were illegally dismissed. They cite Article 283 of the
Labor code where an employer may terminate the
employment of any employee due to the installation of
labor saving devices, redundancy, retrenchment to
prevent losses or the closing or cessation of operation.
ISSUE
Whether or not the Court should apply the legal
maxim verbal legis in construing Article 283 of the
Labor Code as regards its applicability to the case at
bar.
RULING
Yes, the legal maxim is applicable in this case. The use
of the word may, in its plain meaning, denotes that it
is directory in nature and generally permissive only.
Also, Article 283 of the Labor Code does not
contemplate a situation where the closure of the
business establishment is forced upon the employer
and ultimately for the benefit of the employees. The
Patalon Coconut Estate was closed down because a
large portion of the said estate was acquired by the
DAR pursuant to the CARP. The severance of employeremployee relationship between the parties came
about involuntarily, as a result of an act of the State.
Consequently, complainants are not entitled to any
separation pay. Where the words of a statute are clear,
plain and free from ambiguity, it must be given its
literal meaning and applied without attempted
interpretation.
Hidalgo v Hidalgo
HIDALGO V HIDALGO
L-25326
May 29, 1970
What is Within the Spirit is Within the Law
FACTS: Two petitions for review of decisions with the
same issue involving the same land owners and
vendees which dismissed petitioners actions as share
tenants for the enforcement of the right to redeem
agricultural lands. Petitioners have been working on
the lands as share tenants for several years.
1.
First case: respondent-vendor Policarpio Hidalgo
owned lands and sold it with two other parcels of land
for 4,000. Igmidio Hidalgo and Martina Rosales as
tenants alleged that the area of land they worked on is
worth 1, 500 and thus they seek the execution of a
deed of sale for the same amount by respondentsvendee in their favor by way of redemption.2.Second
case: parcel of land worth 750 was sold by respondent.
Petitioner-spouses Hilario Aguila and Adela Hidalgo
sought the execution of a deed of sale for the same
price by way of redemption.
Sec12 of the Land Reform Code or RA 3844 is available
to leasehold tenants only but not to share tenants.
It provides that:
Lessees Right of RedemptionIn case the landholding
is sold to a third person without the knowledge of
agricultural lessee, the latter shall have the right to
redeem the same at areas on able price and
consideration.; Provided: further, that where there are

two or more agricultural lessees, each shall be entitled

to said right of redemption only to the extent of the
area actually cultivated by him. The right of
redemption under this Section may be exercised within
two years from the registration of the sale, and shall
have the priority over any right of legal redemption.
No 90-day notice of intention to sell the lands for the
exercise of the pre-emption prescribed bySex11 of the
Agricultural Land Reform was given
ISSUE: WON the right of redemption granted by Sec12
of RA 3844 is applicable to share tenants also.
Or,
WON the plaintiffs, as share tenants are entitled to
redeem the parcel of land they are working from the
purchasers thereof where no notice was previously
given to them by the vendor, who was their
landholder,of the latters intention to sell their
property and where the vendor did not execute the
affidavit required by Sec13 of RA 3844 before the
registration of the deed of sale
HELD: Where the true intent of the law is clear, such
intent or spirit must prevail over the letter hereof.
Whatever is within the spirit of a statue is within the
statute, since adherence to the letter would result in
absurdity, injustice, and contradictions and would
defeat the plain and vital purpose of the statute.

PNB v Office of the President

PNB v Office of the President
G.R. 104528
January 18, 1996
Case Doctrine: Intent of Statute is the Law
FACTS:
Petitioner bank challenges the decision of the Office of
the President when it invoked P.D. 957 The
Subdivision and Condominium Buyers Protective
Decree in the mortgage contract in question, as
having been executed prior to the enactment of said
law.
Petitioner contends that its not privy to the contract
between the private respondents and mortgagorsubdivision developer, hence, the Office of the
President erred in ordering the bank to collect private
respondents remaining amortizations and issue the
corresponding titles after payment. They cannot
compel the private respondents to pay again the lots
which they previously bought from the subdivision
developer.
ISSUE:
Whether or not P.D. 957 is applicable to the mortgage
contract in question which was executed prior to the
enactment of P.D. 957?
RULING:
Yes--Pursuant to Article 4 of the Civil Code, laws shall
have no retroactive effect, unless the contrary is
provided. However, it is obvious and indubitable that
P.D. 957 was intended to cover even those real estate
mortgages executed prior to its enactment, and such
intent must be given effect if the purpose is to protect

innocent purchasers. While P.D. 957 did not expressly

provide for retroactivity in its entirety, it is the
unmistakable intent of the law to protect innocent
buyers from scheming subdivision developers.
The intent of the law must be enforced. If a statute is
valid it is to have effect according to the purpose and
intent of the lawmaker. It is the vital part, the essence
of the law, and the primary rule of construction is to
ascertain and give effect to the intent.
Solid Homes v Tan
SOLID HOMES V TAN
465 SCRA 137 July 29, 20005
FACTS
Spouses Joe Uy and Myrna Uy buys a subdivision lot at
Loyola Grand Villas Subdivision, Quezon City which
was subsequently sold to spouses Ancheta K. Tan and
Corazon de Jesus-Tan. From then on, respondents
visited their property a number of times, only to find
out the sad state of development thereat. There was
no infrastructure and utility systems for water,
sewerage, electricity and telephone, as announced in
the approved plans and advertisements of the
subdivision. Worse, squatters occupy their lot and its
surrounding areas. In short, there has been no
development at all.
Accordingly, in a letter respondents demanded on
petitioner to provide the needed utility systems and
clear the area of squatters and other obstructions by
the end of January, 1996 to enable them to start the
construction of their house conformably with P.D. No.
957 which requires an owner or developer of a
subdivision project to develop the same within one
year from the issuance of its license. Having received
no reply from petitioner, respondents filed with the
Field Office of the Housing and Land Use Regulatory
Board (HLURB), NCR a complaint for specific
performance and damages.
ISSUE
WON Respondents right to bring the instant case
against petitioner has already prescribed?
HELD
No. Petitioner argued that the 10 yrs prescriptive
period should be reckoned from April 7, 1980 when
they sold the lot to spouses Uy or at the latest on
February 1985. The SC disagree because it is from the
time an act is performed or an omission incurred which
is violative of plaintiffs right, that signals the accrual of
a case of action.
Thus, the period of prescription of any action is
reckoned only from the date the cause of action
accrued. And a cause of action arises when that which
should have been done is not done, or that which
should not have been done is done.In many instances,
this Court has refused to apply the literal import of a
particular provision of law when to do so would lead to
unjust, unfair and absurd results. After all, it is the
function of courts to see to it that justice is dispensed,
fairness is observed and absurdity prevented.
King v Hernandez
US v Toribio
US v TORIBIO
G.R. No. L-5060

January 26, 1910

Construction to Accomplish Purpose
FACTS:
Respondent Toribio is an owner of carabao, residing in
the town of Carmen in the province of Bohol. The trial
court of Bohol found that the respondent slaughtered
or caused to be slaughtered a carabao without a
permit from the municipal treasurer of the municipality
wherein it was slaughtered, in violation of Sections 30
and 33 of Act No. 1147, an Act regulating the
registration, branding, and slaughter of Large Cattle.
The respondent counters by stating that what the Act
is (1) prohibiting is the slaughter of large cattle in the
municipal slaughter house without a permit given by
the municipal treasurer. Furthermore, he contends that
the municipality of Carmen has no slaughter house
and that he slaughtered his carabao in his dwelling.
Sections 30 and 33 of Act No. 1147 provides that no
large cattle shall be slaughtered or killed for food at
the municipal slaughter house except upon permit
secured from the municipal treasurer and any
person slaughtering or causing to be slaughtered for
human consumption any larger cattle except upon
permit secured from the municipal treasurer shall be
punished xxx.
The court said that there may be two possible
constructions of these sections: the first, whereby the
phrase at the municipal slaughterhouse referring to
both slaughtered and killed for food; and the
second, limiting the phrase at the municipal
slaughterhouse to the words killed for food
ISSUE: Whether the slaughter of large cattle outside of
the municipal slaughter house without permit by the
municipal treasurer is prohibited
HELD: YES. Considering the purpose of the enactment
of the act to protect large cattle against theft and to
make easy recovery and return of such cattle to their
owners, when lost, strayed or stolen, allowing
slaughter outside, the court ruled that the act applies
generally to the slaughter of large cattle for human
consumption, ANYWHERE, without a permit duly
secured from the municipal treasurer, For to do
otherwise is to defeat the purpose of the law and the
intent of the law makers.
Commendador v Villa
COMENDADOR vs. DE VILLA
G.R. No. 93177
August 2, 1991
When Reason of the Law Ceases, the Law Ceases
FACTS:
The petitioners are officers of the Armed Forces of the
Philippines facing prosecution for their alleged
participation in the failed coup detat that took place
on December 1 to 9, 1989. The charges against them
are violations of Articles of War: Mutiny (AW 67),
Conduct Unbecoming an Officer and a Gentleman (AW
96), and Various Crimes (AW 94) in relation to Murder
(RPC Art 248).

These four cases have been consolidated because

they involve practically the same parties and related
issues arising from the same incident.
(1) G.R. No. 93177 a petition for certiorari,
prohibition and mandamus, they are questioning the
conduct of the Pre-Trial Investigation (PTI) Panel
constituted to investigate the charges against them
and the creation of the General Court Martial (GCM)
convened to try them.
(2) G.R. No. 96948 challenged the legality of GCM
No. 14 and sought certiorari against its ruling denying
them the right to preemptory challenge as granted by
Art 18 of Com. Act No. 408.
(3) G.R. No. 95020 a petition for certiorari assailing
the orders of the respondent judge of RTC of Quezon
City on the ground that he has no jurisdiction on GCM
No. 14 and no authority either to set aside its ruling
denying bail to the private respondents.
(4) G.R. No. 97454 raised jurisdictional objections
and a petition for certiorari against the decision of RTC
of QC in a petition for habeas corpus directing the
release of the private respondents.
ISSUE:
WON the military personnel are entitled to bail
RULING:
NO. We find that the right to bail invoked by the
private respondents in G.R. No. 95020 has traditionally
not been recognized and is not available in the
military, as an exception to the general rule embodied
in the Bill of Rights. This much was suggested in Arula,
where we observed that the right to a speedy trial is
given more emphasis in the military where we
observed that the right to a speedy trial is given more
emphasis in the military where the right to bail does
not exist. The justification for this exception was well
explained by the Solicitor General as follows:
The unique structure of the military should be
enough reason to exempt military men from the
constitutional coverage on the right to bail.
Aside from the structural peculiarity, it is vital to note
that mutinous soldiers operate within the framework of
democratic system, are allowed the fiduciary use of
firearms by the government for the discharge of their
duties and responsibilities are paid out of the revenues
collected from the people.
It is a basic canon of statutory construction that when
the reason of the law ceases, the law itself ceases.
Cessante ratione legis, cessat ipsa lex. This principle is
also expressed in the maxim ratio legis est anima: the
reason of law is its soul.

Matabuena v Cervantes
Morales v Subido
Rufino Lopez & Sons, Inc v Court of Tac Appeals
RUFINO LOPEZ &
SONS, INC., petitioner,
vs.

THE COURT OF TAX

APPEALS, respondent.
G.R. No. L9274
Facts:
Petitioner appellant Rufino Lopez & Sons, Inc. is
appealing from a resolution of the Court of Tax Appeals
dismissing its appeal from a decision of the Collector
of Customs for the Port of Manila, assessing additional
fees on petitioner for a certain importation of wire
netting. The facts are simple and undisputed. Lopez &
Sons imported hexagonal wire netting from Hamburg,
Germany. The Manila Collector of Customs assessed
the corresponding customs duties on the importation
on the basis of consular and supplies invoices. Said
customs duties were paid and the shipments were
released. Subsequently, however, and freight of said
wire netting and as a result of the reassessment,
additional customs duties in the amount of P1,966.59
were levied and imposed upon petitioner.
Failing to secure a reconsideration of the reassessment
and levy of additional customs duties, Lopez & Sons
appealed to the Court of Tax Appeals.
Acting upon a motion to dismiss the appeal, filed by
the Solicitor General on the ground of lack of
jurisdiction, the Tax Court, by its resolution of May 23,
1955, dismissed the appeal on the ground that it had
no jurisdiction to review decisions of the Collector of
Customs of Manila, citing section 7 of Republic Act No.
1125, creating said tax court. From said resolution of
dismissal, Lopez & Sons appealed to us, seeking a
reversal of said resolution of dismissal.
Issue:
WON the Court of Tax Appeals have jurisdiction to
review by appeal, decisions of the Collector of
Customs?
Held:
Tax Court may refuse to entertain said appeal, as was
done in the present case, on the ground that under
section 7 of Republic Act No. 1125, it had no
jurisdiction to review a decision of the Collector of
Customs, section 7 clearly limiting its appellate
jurisdiction to review decisions of the Commissioner of
Customs.
In view of the foregoing, we hold that under the law,
particularly, the Customs Law and Republic Act No.
1125, the Court of Tax Appeals has no jurisdiction to
review by appeal, decisions of the Collector of
Customs. The appealed order of dismissal is hereby
affirmed, with costs.
Oliveros v Villaluz

Homicide. Respondent Judge rendered judgment

exactly in accordance with the plea bargaining
agreement. Pedro Amatan, the deceaseds brother-inlaw, filed a complaint against the respondent judge,
saying that the sentence of lesser offense of
Attempted Homicide instead of Homicide, as was
called for in the case, is indicative enough of the
judges gross incompetence, gross ignorance of the
law or gross misconduct. Respondent judge avers that
he rendered judgment relying on Sec 2 Rule 116 of the
1985 Revised Rules of Criminal Procedure, as
amended, which allows an accused individual to plead
guilty to a lesser offense, with the consent of offended
party, regardless of whether or not such offense is
necessarily included in the crime charged, or
cognizable by the court of a lesser jurisdiction.
ISSUE: Whether or not the judge correctly relied on the
said section of the Revised Rules of Criminal Procedure
to lower the sentence to the accused
HELD: No- The fact of the death in the case cannot be
reconciled with the plea of guilty to the lower offense
of Attempted Homicide. Homicide as defined in Article
249 of the RPC produces death; Attempted Homicide
does not. While it is true that the judge merely applied
the rule, the incongruous result ought to have alerted
him of the impossibility of justice. Though there exists
a hiatus in the law in this case which led to its
misapprehension, the Civil Code admonishes judges to
take principles of right and justice at heart in instance
where a literal application of a provision of law would
lead to injustice or to a result so directly in opposition
with the dictates of logic and common sense.
Ursua v Court of Appeals
Co Kim Cham v Valdez Tan Teh
Case Title: Co Kim Chan v Valdez Tan Keh
GR No.: G.R. No. L-5
Date: September 17, 1945
Case Doctrine: Construction to Avoid Danger to public
interest
FACTS: Co Kim Chan, petitioner, had a pending civil
case at the Court of First Instance of Manila initiated
during the Japanese occupation. Post the Japanese
occupation and in accordance with the proclamation
by General Douglas MacArthur, Judge Arsenio Dizon,
respondent, refused to continue with the hearings of
the petitioners case. The said proclamation stated:

Amatan v Aujero
AMATAN VS AUJERO
September 27, 1995
Case doctrine: Construction to Avoid Injustice
FACTS: The validity of judgment rendered by
respondent judge Vicente Aujero is assailed in this
case. A criminal complaint was filed against Rodrigo
Umpad, accusing him of the murder (under Article 248
of the Revised Penal Code) of Genaro Tagsip. Upon
arraignment, the two parties entered into a plea
bargaining where it was agreed that the accused
would plead guilty to the lesser offense of Attempted

"[T]hat all laws, regulations and processes of any of

the government in the Philippines than that of the said
Commonwealth are null and void and without legal
effect in areas of the Philippines free of enemy
occupation and control."
ISSUE:WON the proclamation by Gen. MacArthur has
invalidated all judgments, judicial acts and
proceedings of the courts under the Philippine
Executive Commission.
RULING: No. The Court held that the process in the
proclamation did not pertain to judicial processes but

only to executive/administrative and legislative orders.

To render the judicial processes under the Japanese
occupation invalid was to violate the international
laws, and such could not have been the intention of
Gen. MacArthur.
International law states that all acts and proceedings
of a de facto government are good and valid. In this
light, all judgments and judicial acts by the courts
during the Japanese occupation are considered good
and valid. Considering the rules of statutory
construction, Gen. MacArthurs proclamation should
not be construed to violate the international law.
Furthermore, the Court ruled that a construction
contrary to the international law would also be
detrimental to public interest for ...disputes or suits
already adjudged would have to be again settled
accrued or vested rights nullified, sentences passed on
criminals set aside, and criminals might easily become
immune for evidence against them may have already
disappeared or be no longer available, especially now
that almost all court records in the Philippines have
been destroyed by fire as a consequence of the war.

amended by PD 1246, otherwise known as the Foreign

Currency Deposit Act be made applicable to a foreign
transient?
HELD: No. The provisions of Section 113 of Central
Bank Circular No. 960 and PD No. 1246, insofar as it
amends Section 8 of Republic Act No. 6426, are hereby
held to be INAPPLICABLE to this case because of its
peculiar circumstances. Respondents are hereby
required to comply with the writ of execution issued in
the civil case and to release to petitioners the dollar
deposit of Bartelli in such amount as would satisfy the
judgment.
Supreme Court ruled that the questioned law makes
futile the favorable judgment and award of damages
that Salvacion and her parents fully deserve. It then
proceeded to show that the economic basis for the
enactment of RA No. 6426 is not anymore present; and
even if it still exists, the questioned law still denies
those entitled to due process of law for being
unreasonable and oppressive. The intention of the law
may be good when enacted. The law failed to
anticipate the iniquitous effects producing outright
injustice and inequality such as the case before us.

Rules of Statutory Construction:

1. A statute ought never to be construed to violate
the law of nations if any other possible construction
remains.
2. [W]here great inconvenience will result from a
particular construction, or great mischief done, such
construction is to be avoided, or the court ought to
presume that such construction was not intended by
the makers of the law, unless required by clear and
unequivocal words.
Salvacion v Central Bank
Salvacion v Central Bank of the Philippines
August 21, 1997
G.R. No. 94723
Case Doctrine: Application of the law depends on the
extent of its justice.
FACTS: Greg Bartelli, an American tourist, was arrested
for committing four counts of rape and serious illegal
detention against Karen Salvacion. Police recovered
from him several dollar checks and a dollar account in
the China Banking Corp. He was, however, able to
escape from prison. In a civil case filed against him,
the trial court awarded Salvacion moral, exemplary
and attorneys fees amounting to almost
P1,000,000.00.
Salvacion tried to execute the judgment on the dollar
deposit of Bartelli with the China Banking Corp. but the
latter refused arguing that Section 11 of Central Bank
Circular No. 960 exempts foreign currency deposits
from attachment, garnishment, or any other order or
process of any court, legislative body, government
agency or any administrative body whatsoever.
Salvacion therefore filed this action for declaratory
relief in the Supreme Court.
ISSUE: Should Section 113 of Central Bank Circular No.
960 and Section 8 of Republic Act No. 6426, as

The SC adopted the comment of the Solicitor General

who argued that the Offshore Banking System and the
Foreign Currency Deposit System were designed to
draw deposits from foreign lenders and investors and,
subsequently, to give the latter protection. However,
the foreign currency deposit made by a transient or a
tourist is not the kind of deposit encouraged by PD
Nos. 1034 and 1035 and given incentives and
protection by said laws because such depositor stays
only for a few days in the country and, therefore, will
maintain his deposit in the bank only for a short time.
Considering that Bartelli is just a tourist or a transient,
he is not entitled to the protection of Section 113 of
Central Bank Circular No. 960 and PD No. 1246 against
attachment, garnishment or other court processes.
Further, the SC said: In fine, the application of the law
depends on the extent of its justice. Eventually, if we
rule that the questioned Section 113 of Central Bank
Circular No. 960 which exempts from attachment,
garnishment, or any other order or process of any
court, legislative body, government agency or any
administrative body whatsoever, is applicable to a
foreign transient, injustice would result especially to a
citizen aggrieved by a foreign guest like accused Greg
Bartelli. This would negate Article 10 of the New Civil
Code which provides that in case of doubt in the
interpretation or application of laws, it is presumed
that the lawmaking body intended right and justice to
prevail.
Demafiles v COMELEC
Demafiles vs. COMELEC
December 29,1967
G.R. No. L- 28396
Topic: Departure from Literal Interpretation (Statute
must be capable of interpretation)
Facts:
The new municipality of Sebaste1 in Antique province
held its first election of officers in the general elections
of November 14, 1967, with the petitioner Agripino

Demafiles and the respondent Benito B. Galido vying

for the mayoralty. On November 21 the respondent
Galido asked the provincial board, acting as municipal
board of canvassers pursuant to section 167 (b) of the
Revised Election Code, to disregard, as "obviously
manufactured", the election return from precinct 7 on
the ground that the said return shows that 195 voters
were registered (of whom 188 voted), when, according
to a certificate of the municipal election registrar only
182 had registered in that precinct as of October 30,
1997. The return from precinct 7 was the rejected. The
resulting tally from the canvassing of votes gave
Galido 888 votes as against 844 for Demafiles. Galido
was proclaimed mayor-elect of the municipality of
Sebaste.
Demafiles filed a complaint against COMELEC
protesting the board's action of rejection of the return
from precinct 7 and the subsequent proclamation of
Galido, and challenging the right of two members of
the board of canvassers, Julito Moscoso and Quirico
Escao, to sit, considering that they were
reelectionists.
Issues:
1.
Whether or not the case is moot because
respondent Galido had taken his oath and assumed
office on November 22, pursuant to Republic Act 4870.
2.
Whether or not the canvassing board may pass
upon the validity of the election return in this case.
3.
Whether or not the canvass and proclamation
should be annulled
Ruling:
No. In the courts view, the last portion of the
provision "and shall have qualified" is devoid of
any meaning and does not warrant the respondent's
reading that the term of office of the first municipal
officials of Sebaste begins immediately after their
proclamation. Here is a clear case of a failure to
express a meaning, and a becoming sense of judicial
modesty forbids the courts from assuming and,
consequently, from supplying. The court agreed by the
general rule that the term of office of municipal
officials shall begin on the first day of January following
their election, and so the assumption of office by the
respondent Galido in no way affected the basic issues
in this case.
Yes. A canvassing board performs a purely ministerial
function that of compiling and adding the results
they appear in the returns, transmitted to it. However,
they cannot pass upon the validity of an election
return, much less exclude it from the canvass on the
ground that the votes cast in the precinct from whence
it came are illegal. But the exclusion of the return in
this case is sought to be justified on the ground that it
is "obviously manufactured" because, contrary to the
statement therein that there were 195 registered
voters, of whom 188 voted, the certificate of the local
election registrar states that only 182 voters had
registered on October 30, 1967.
Yes. The canvass and proclamation should be annulled
because two of the four members of the board of
canvassers were disqualified from sitting in it, they
being candidates for reelection. The statement of
respondent Galido that reelectionist members of the
provincial board are disqualified under section 28 only
when the board acts as a provincial board of
canvassers, to prevent them from canvassing their
own votes, and not when they sit as a municipal board
of canvassers, is branded as obiter dictum

People v Gutierrez
Gatchalian v COMELEC
Chua v CSC
CHUA VS CIVIL SERVICE COMMISSION
GR. NO. 88979 Feb. 7, 1992
Doctrine of Necessary Implication
Padilla, J:
FACTS: On December 2, 1988, Republic Act 6683 was
enacted to provide benefits for early retirement and
voluntary separation of government employees as well
as involuntary separation due to reorganization. Those
who may avail are regular, temporary, casual, and
emergency employees.
Petitioner Lydia Chua was hired in National Irrigation
Administration for 15 years as a coterrminous
employee in four successive NIA projects. Believing
that she is qualified to avail of the benefits of the
program, Chua filed an application to NIA. But the
latter denied. She then went to Civil Service
Commission, but was likewise denied. She was offered
separation benefits equivalent to 1/2 month basic pay
for every year of service commencing from 1980
instead.
ISSUE: Whether or not the petitioner is entitled to the
benefits granted under Republic Act No. 6683.
HELD: Yes. Art. III, Sec. 1 of the 1987 Constitution
guarantees: "No person shall be deprived of life,
liberty, or property without due process of law, nor
shall any person be denied the equal protection of the
laws." Applying the criteria set forth, the Early
Retirement Law would violate the equal protection
clause were we to sustain respondents' submission
that the benefits of said law are to be denied a class of
government employees who are similarly situated as
those covered by said law. Co-terminous or project
personnel, who have rendered years of continuous
service should be included in the coverage of the Early
Retirement Law, as long as they file their application
prior to the expiration of their term, and as long as
they comply with CSC regulations promulgated for
such purpose. In fine, the Court believes, and so holds,
that the denial by the respondents NIA and CSC of
petitioner's application for early retirement benefits
under Rep. Act No. 6683 is unreasonable, unjustified,
and oppressive, as petitioner had filed an application
for voluntary retirement within a reasonable period
and she is entitled to the benefits of said law.
COA v Province of Cebu
THE COMMISSION ON AUDIT OF THE PROVINCE OF
CEBU v. PROVINCE OF CEBU
G.R. No. 141386 ; 29 November 2001
Ynares-Santiago, J.
Facts: The provincial governor of the province of Cebu,
as chairman of the local school board, under Section
98 of the Local Government Code, appointed
classroom teachers who have no items in the DECS
plantilla to handle extension classes that would
accommodate students in the public schools. In the
audit of accounts conducted by the Commission on
Audit (COA) of the Province of Cebu, for the period

January to June 1998, it appeared that the salaries and

personnel-related benefits of the teachers appointed
by the province for the extension classes were charged
against the provincial SEF. Likewise charged to the SEF
were the college scholarship grants of the province.
Consequently, the COA issued Notices of Suspension
to the province of Cebu, saying that disbursements for
the salaries of teachers and scholarship grants are not
chargeable to the provincial SEF. petitioner claims that
since what is allowed for local school boards to
determine under Section 99 of the Local Government
Code is only the annual supplementary budgetary
needs for the operation and maintenance of public
schools, as well as the supplementary local cost to
meet such needs, the budget of the local school
boards for the establishment and maintenance of
extension classes should be construed to refer only to
the upkeep and maintenance of public school
buildings, facilities and similar expenses other than
personnel-related benefits.
Issue: Whether or not the petitioners contention that
of Sec. 99 of the Local Government Code merely refers
to the upkeep and maintenance of buildings facilities
and the similar?
Resolution: Under the doctrine of necessary
implication, the allocation of the SEF for the
establishment and maintenance of extension classes
logically implies the hiring of teachers who should, as
a matter of course be compensated for their services.
Every statute is understood, by implication, to contain
all such provisions as may be necessary to effectuate
its object and purpose, or to make effective rights,
powers, privileges or jurisdiction which it grants,
including all such collateral and subsidiary
consequences as may be fairly and logically inferred
from its terms. Ex necessitate legis. Verily, the services
and the corresponding compensation of these teachers
are necessary and indispensable to the establishment
and maintenance of extension classes.
Batungbakal v National Development Co.
Gordon v Veridiano
Gordon (petitioner)
v.
Veridiano II and spouses Eduardo and Rosalina Yambao
(respondents)
167 SCRA 5
November 8, 1988
Case Doctrine: Grant of Power Includes Incidental
Power
FACTS:
Respondent Yambao owns a San Sebastian Drugstore
and an Olongapo City Drugstore. A test buy operation
at San Sebastian Drugstore, wherein agents were sold
200 tablets of Valium without a doctors prescription,
gave rise to the closure ordered by the FDA. Before
such order was promulgated, the Mayor revoked the
Mayors Permits issued to San Sebastian Drugstore
and subsequently, a signboard was posted by the ViceMayor at the drugstore announcing its permanent
closure. On May 7, 1980, FDA approved Respondents
request to exchange the locations of the two
drugstores (which were 5m apart and in the same
building). Upon knowledge of this, Petitioner then
revoked the Mayors Permit issued to Olongapo City
Drugstore.

ISSUE:
The conflict between the FDAs and the mayors power
to grant and revoke licenses for the operation of
drugstores
RULING:
The power to approve a license includes by
implication, even if not expressly granted, the power
to revoke it. By extension, the power to revoke is
limited by the authority to grant the license, from
which it is derived in the first place.
Thus, if the FDA grants a license upon its
finding that the applicant drug store has complied with
the requirements of the general laws and the
implementing administrative rules and regulations, it
is only for their violation that the FDA may revoke the
said license. By the same token, having granted the
permit upon his ascertainment that the conditions
thereof as applied particularly to Olongapo City have
been complied with, it is only for the violation of such
conditions that the mayor may revoke the said permit.

UST v Board of Tax Appeals

UNIVERSITY OF SANTO TOMAS, petitioner,
vs.
THE BOARD OF TAX APPEALS, respondent.
G.R. No. L-5701
Doctrine: Grant of Power Excludes Greater Power
FACTS: In 1950, the University of Santo Tomas was
assessed a deficiency tax on its income from tuition
fees. UST opposed such assessment but it paid it
under protest. UST then submitted to the Secretary of
Finance a memorandum regarding the matter. UST
avers that the tax was illegally collected. The
Secretary of Finance then advised UST to file a petition
for review with the Board of Tax Appeals (BTA)
regarding their protest. UST complied but after filing
the petition, UST filed a motion questioning the
jurisdiction of the BTA. UST assailed EO 401-A which
gave BTA the jurisdiction to hear cases involving
illegally collected taxes. UST avers that this effectively
deprives the regular courts of law their jurisdiction to
take cognizance of recovery of illegally collected taxes.
ISSUE: Whether or not the President has a capacity to
exercise the power in RA 442?
Whether or not the Board of Tax Appeals has
jurisdiction over the cases involved in the taxes
protest by UST.
HELD:
Republic Act No. 442 was enacted with the only
purpose of giving to the President the authority "to
reorganize within one year the different executive
departments, bureaus, offices, agencies and other
instrumentalities of the Government, including the
corporations owned or controlled by it, . . . . to
promote simplicity, economy, and efficiency, and to
improve the service in the transaction of the public
business." The purpose of said Act is merely to effect a
reorganization of the different bureaus, offices,
agencies and instrumentalities of the executive branch
of the government. The power so delegated is
therefore limited in scope. It cannot be extended to

other matters not embraced therein, nor are incidental

thereto. To do so would be an encroachement on
powers expressly lodged in Congress by our
Constitution.
But Executive Order No. 401-A does not merely create
the Board of Tax Appeals, which, as an instrumentality
of the Department of Finance, may properly come
within the purview of Republic Act No. 422, but goes as
far as depriving the courts of first instance of their
jurisdiction to act on internal revenue cases a matter
which is foreign to it and which comes within the
exclusive province of Congress. This the Chief
Executive cannot do, nor can that power be delegated
by congress, for under our Constitution, Congress
alone has the power to define, prescribe, and
apportion the jurisdiction of the various courts (Article
VIII, section 2, Philippine Constitution).
We are therefore of the opinion that Executive Order
No. 401-A is null and void in so far as it interferes with
the jurisdiction of the courts of first instance in cases
arising not only under the internal revenue law but
also customs law and assessment law, but is valid with
regard to the rest of its provisions in so far as they
affect the organization and administrative functions of
the Board of Tax Appeals. More specifically, we hold
that part IV of said Executive Order which refers to
"court Review of Board Decisions," is null and void.
Wherefore, petition is hereby granted, without costs.

Dinglasan v Lee Hun

DINGLASAN et. al. vs LEE BUN TING et. al.
No. L-5996
27 June 1956
J. LABRADOR
Topic: Illegality of Act Implied from Prohibition
FACTS
Appellants sold to Lee Liong, a Chinese citizen,
predecessor in interest of appellees, a parcel of land
situated on the corner of Roxas Avenue and Pavia
Street, Capiz (now Roxas City) designated as lot 398.
After the sale, Lee Liong constructed a concrete
building which he used as a place for his lumber
business and in part as a residence for himself and
family. The appellants contend that the sale was null
and void as it was made in violation of the
Constitution, Art. XIII, Sec. 5, but the Court of Appeals
found out that the purchaser was not aware of the
constitutional prohibition, while the appellants were
because the negotiations for the sale was conducted
with the knowledge and direct intervention by Judge
Dinglasan. It held that even if Lee Liong had known of
the prohibition, the suit would not lie because of the
principle of pari delicto, that courts will not aid either
party to an illegal contract if both are equally guilty
but will leave them where they find them.
ISSUE
W/NOT Lee Bun Ting et. al. have the right to
repurchase.
HELD
NONE. The doctrine of pari delicto bars appellants from
recovering the title to the property in question. As the
sale to Lee Liong is prohibited by the Constitution, title
to the land did not pass to said alien because the sale
did not produce any juridical effect in his favor and
that the constitutional prohibition should be deemed
self-executing in character, in order to give effect to
the Constitutional mandate. The sale after being null
and void, does not guarantee that the title will remain

with the vendor, who had also violated the

constitutional prohibition, or that he has the right to
repurchase. In such contingency another principle of
law sets in to bar the equally guilty vendor from
recovering the title, which he had voluntarily conveyed
for a consideration, that of pari delicto.
De Los Santos v Roman Catholic Church
De Los Santos v Roman Catholic Church
February 25, 1954
L-6088
Case Doctrine: Illegality Of Act Implied From
Prohibition (Exception)
FACTS:
Petition of appeal from a judgment rendered by the
Court of First Instance in Cotabato, declaring the sale
of the homestead from Julio Sarabillo to Roman
Catholic dated 1940, to be null and void.
Julio Sarabillo was granted a homestead tract of land
in Midsayap, Cotabato December 9, 1938 which was
sold to Roman Catholic on December 31, 1940. When
Julio died, Catalina De Los Santos was appointed as
the administratix, and having found the course of her
administration in the sale of land was made in
violation of Section 118 of Commonwealth Act No. 141.
The court ordered the petitioner to reimburse the P800
(contract price) and P610 (amount of improvements on
the land) to the defendant. Thus the petition filed
stating that the court erred in declaring the said sale
as null and void.
ISSUE:
Whether or not the sale of the homestead tract of land
in Midsayap, Cotabato to Roman Catholic, is null and
void
HELD:
The decision is affirmed. Section 118 of
Commonwealth Act No. 141 prohibits the sale or
encumbrance of the homestead within 5 years after
the grand of the patent which is mandatory. This law is
for the purpose of promoting a definite public policy
which is to preserve and keep in the family of the
homesteader that portion of the public land which the
state has gratuitously given to him. Thus the sale in
1940 to Roman Catholic is within the 5 year period
from the date of acceptance of the grant given to Julio
Sarabillo in 1938 hence null and void. The purchaser
has no more right to remain the possession of the
land.

Acierto v De los Santos

CASE DOCTRINE: EXCEPTION on Illegality of Act
Implied From Prohibition
FACTS:
Pelagio Acierto was granted a homestead patent to a
portion of public land situated in the municipality of
Tuao, Cagayan province. The land was, as required by
the Land Registration Act (section 122).
Palegio Acierto died and his children the plaintiffs
brought an action in the Court of First Instance of

Cagayan against the defendants for the recovery of

the land in question and damages.
The defendant alleged the purchase of the land from
Pelagio Acierto. After trial lower court found that the
land in dispute rendered judgment-declaring that the
sale is void hence the plaintiffs still owners of the land
but under obligation to pay defendant the sum of Php
200.
ISSUE:
Whether or not the pari delicto doctrine should
apply?
Whether or not the sale of land is valid?
HELD:
The court ruled that the pari delicto doctrine may not
be invoked, in a case of this kind since it would run
counter to an avowed fundamental policy of the State
(The Land Registration Act), that the forfeiture of the
homestead is a matter between the State and the
grantee or his heirs, and that until the State had taken
steps to annul the grant and asserts title to the
homestead the purchaser is, as against the vendor or
his heirs, "no more entitled to keep the land than any
intruder.." In view of the foregoing, the judgment
below is affirmed in so far as it adjudges possession of
the homestead to plaintiffs and declares the latter
under obligation to pay P200 to defendants. Costs
against defendants-appellants.
Additional Information:
1. PUBLIC LANDS; REGISTRATION OF PATENT MAKES
THE LAND REGISTERED WITHIN THE MEANING OF THE
LAND REGISTRATION ACT. Where the land was
granted by the State to a private individual under the
Public Land Law, and the corresponding patent was
registered and issued to the grantee, said land is
considered registered within the meaning of the Land
Registration Act. (El Hogar Filipino v. Olviga, 60 Phil.,
17, 22; Ramoso v. Obligado, 70 Phil., 86, 70.)
2. TITLE OVER REGISTERED LAND CANNOT BE
ACQUIRED BY PRESCRIPTION. Where the land is
registered, no title in derogation to that of the
registered owner shall be acquired by prescription or
adverse possession.
3. SALE MADE DURING THE FIVE YEARS FOLLOWING
ISSUANCE OF PATENT IS VOID "AB INITIO." The sale
of land acquired as homestead during the five years
following the issuance of the patent is void ab initio.
4. WHERE APPLICATION OF "PARI DELICTO" DOCTRINE
WOULD BE AGAINST FUNDAMENTAL POLICY OF STATE,
IT MAY NOT BE INVOKED. The pari delicto doctrine
may not be invoked where it would run counter to an
avowed fundamental policy of the State.

Barsobia v Cuenco
BARSOBIA VS CUENCO
G.R. No. L-33048
April 16, 1982

Doctrine: In Pari Delicto Potior Est Conditio Defendentis

FACTS: Epifania Barsobia, one of the respondents, and
his husband, both Filipino citizens, own a one-half
portion (on the northern side) of two adjoining parcels
of coconut land located at Barrio Mancapagao, Sagay,
Camiguin, Misamis Oriental (now Camiguin Province).
On September 5, 1936, Epifania Barsobia sold the land
in controversy to a Chinese, Ong King Po, for the sum
of P1,050.00. Ong King Po took actual possession and
enjoyed the fruits thereof.
On August 5, 1961, Ong King Po sold the litigated
property to Victoriano T. Cuenco (respondent herein), a
naturalized Filipino, for the sum of P5,000.00
Respondent immediately took actual possession and
harvested the fruits therefrom.
On March 6, 1962, Epifania "usurped" the controverted
property, and on July 26, 1962, Epifania through her
daughter, sold a one-half portion of the land in
question to Pacita W. Vallar, the other petitioner
herein. Epifania claimed that it was not her intention to
sell the land to Ong King Po and that she signed the
document of sale merely to evidence her indebtedness
to the latter in the amount of P1,050.00. Epifania has
been in possession ever since except for the portion
sold to the other petitioner Pacita.
ISSUE: WON the respondent is the rightful owner of the
property
HELD: YES. The Court held that the sale of the land in
question in 1936 by Epifania to Ong King Po was
inexistent and void from the beginning according to
Art. 1409 (7) of the Civil Code because it was a
contract executed against the mandatory provision of
the 1935 Constitution, which is an expression of public
policy to conserve lands for the Filipinos.
Had this been a suit between Epifania and Ong King
Po, she could have been declared entitled to the
litigated land on the basis, as claimed, of the ruling in
Philippine Banking Corporation vs. Lui She, 8 reading:
... For another thing, and this is not only cogent but
also important. Article 1416 of the Civil Code provides
as an exception to the rule on pari delicto that when
the agreement is not illegal per se but is merely
prohibited, and the prohibition by the law is designed
for the protection of the plaintiff, he may, if public
policy is thereby enhanced, recover what he has sold
or delivered...
But the factual set-up has changed. The litigated
property is now in the hands of a naturalized Filipino. It
is no longer owned by a disqualified vendee.
Respondent, as a naturalized citizen, was
constitutionally qualified to own the subject property.
There would be no more public policy to be served in
allowing petitioner Epifania to recover the land as it is
already in the hands of a qualified person.
Respondent, therefore, must be declared to be the
rightful owner of the property.