G.R. No.

L-63915 April 24, 1985

LORENZO M. TAADA, ABRAHAM F. SARMIENTO, and MOVEMENT OF ATTORNEYS FOR BROTHERHOOD,
INTEGRITY
AND
NATIONALISM,
INC.
[MABINI], petitioners,
vs.
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to the President, HON. JOAQUIN VENUS, in
his capacity as Deputy Executive Assistant to the President , MELQUIADES P. DE LA CRUZ, in his capacity
as Director, Malacaang Records Office, and FLORENDO S. PABLO, in his capacity as Director, Bureau of
Printing, respondents.
ESCOLIN, J.:

SYLLABUS
1. CONSTITUTIONAL LAW; STATUTES; PUBLICATION IN THE OFFICIAL GAZETTE; LEGAL PERSONALITY OF
PETITIONERS TO FILE MANDAMUS TO COMPEL PUBLICATION, RECOGNIZED. The subject of the petition is
to compel the performance of a public duty and petitioners maintain they need not show any specific interest for
their petition to be given due course. The right sought to be enforced by petitioners is a public right recognized by no
less than the fundamental law of the land. If petitioners were not allowed to institute this proceeding, it would indeed
be difficult to conceive of any other person to initiate the same, considering that the Solicitor General, the
government officer generally empowered to represent the people, has entered his appearance for respondents in
this
case.
2. ID.; ID.; ID.; ARTICLE 2 CIVIL CODE DOES NOT PRECLUDE PUBLICATION IN THE OFFICIAL GAZETTE
EVEN IF THE LAW ITSELF PROVIDES FOR DATE OF ITS EFFECTIVITY. That publication in the Official
Gazette is not a sine qua non requirement for the effectivity of laws where the laws themselves provide for their own
effectivity dates is correct only insofar as it equates the effectivity of laws with the fact of publication. Considered in
the light of other statutes applicable to the issue at hand, the conclusion is easily reached that said Article 2 does
not preclude the requirement of publication in the Official Gazette, even if the law itself provides for the date of its
effectivity.
3. ID.; ID.; ID.; RATIONALE. The clear object of Article 2 of the Civil Code is to give the general public adequate
notice of the various laws which are to regulate their actions and conduct as citizens. Without such notice and
publication, there would be no basis for the application of the maxim "ignorantia legis non excusat." It would be the
height of injustice to punish or otherwise burden a citizen for the transgression of a law of which he had no notice
whatsoever,
not
even
a
constructive
one.
4. ID.; ID.; ID.; PUBLICATION OF PRESIDENTIAL ISSUANCES "OF A PUBLIC NATURE" OR "OF GENERAL
APPLICABILITY," A REQUIREMENT OF DUE PROCESS; UNPUBLISHED PRESIDENTIAL ISSUANCES
WITHOUT FORCE AND EFFECT. The publication of all presidential issuances "of a public nature" or "of general
applicability" is mandated by law. Obviously, presidential decrees that provide for fines, forfeitures or penalties for
their violation or otherwise impose a burden on the people, such as tax and revenue measures, fall within this
category. Other presidential issuances which apply only to particular persons such as administrative and executive
orders need not be published on the assumption that they have been circularized to all concerned. (People v. Que
Po Lay, 94 Phil. 640; Balbuena, Et. Al. v. Secretary of Education, Et Al., 110 Phil. 150) It is needless to add that the
publication of presidential issuances "of a public nature" or "of general applicability" is a requirement of due process.
It is a rule of law that before a person may be bound by law, he must first be officially and specifically informed of its
contents. The Court therefore declares that presidential issuances of general application, which have not been
published,
shall
have
no
force
and
effect.
5. ID.; ID.; ID.; DECLARATION OF INVALIDITY OF UNPUBLISHED PRESIDENTIAL DECREES DOES NOT
AFFECT THOSE WHICH HAVE BEEN ENFORCED OR IMPLEMENTED PRIOR TO THEIR PUBLICATION. The
implementation/enforcement of presidential decrees prior to their publication in the Official Gazette is "an operative
fact which may have consequences which cannot be justly ignored. The past cannot always be erased by a new
judicial declaration . . .that an all inclusive statement of a principle of absolute retroactive invalidity cannot be

justified."
FERNANDO, C.J., concurring with qualification:
1. CONSTITUTIONAL LAW; STATUTES; PUBLICATION REQUIREMENT NEED NOT BE CONFINED TO THE
OFFICIAL GAZETTE. It is of course true that without the requisite publication, a due process question would
arise if made to apply adversely to a party who is not even aware of the existence of any legislative or executive act
having the force and effect of law. But such publication required need not be confined to the Official Gazette. From
the pragmatic standpoint, there is an advantage to be gained. It conduces to certainty. That is to be admitted. It does
not follow, however, that failure to do so would in all cases and under all circumstances result in a statute,
presidential decree, or any other executive act of the same category being bereft of any binding force and effect. To
so hold would raise a constitutional question. Such a pronouncement would lend itself to the interpretation that such
a legislative or presidential act is bereft of the attribute of effectivity unless published in the Official Gazette. There is
no
such
requirement
in
the
Constitution.
2. ID.; ID.; ID.; ID.; REQUIREMENT IN ART. 2 CIVIL CODE DOES NOT HAVE THE JUDICIAL FORCE OF A
CONSTITUTIONAL COMMAND. The Chief Justices qualified concurrence goes no further than to affirm that
publication is essential to the effectivity of a legislative or executive act of a general application. He is not in
agreement with the view that such publication must be in the Official Gazette. The Civil Code itself in its Article 2
expressly recognizes that the rule as to laws taking effect after fifteen days following the completion of their
publication in the Official Gazette is subject to this exception, "unless it is otherwise provided." Moreover, the Civil
Code is itself only a legislative enactment, Republic Act No. 386. It does not and cannot have the juridical force of a
constitutional command. A later legislative or executive act which has the force and effect of law can legally provide
for
a
different
rule.
3. ID.; ID.; ID.; TO DECLARE UNPUBLISHED PRESIDENTIAL ISSUANCES WITHOUT LEGAL FORCE AND
EFFECT WOULD RESULT IN UNDESIRABLE CONSEQUENCES. Nor does the Chief Justice agree with the
rather sweeping conclusion in the opinion of Justice Escolin that presidential decrees and executive acts not thus
previously published in the Official Gazette would be devoid of any legal character. That would be, in his opinion, to
go too far. It may be fraught, as earlier noted, with undesirable consequences. He finds himself therefore unable to
yield
assent
to
such
a
pronouncement.
TEEHANKEE, J., concurring:
1. CONSTITUTIONAL LAW; STATUTES, PUBLICATION IN THE OFFICIAL GAZETTE; NECESSARY PURSUANT
TO THE BASIC CONSTITUTIONAL REQUIREMENTS OF DUE PROCESS. The Rule of Law connotes a body of
norms and laws published and ascertainable and of equal application to all similarly circumstanced and not subject
to arbitrary change but only under certain set procedure. The Court had consistently stressed that "it is an
elementary rule of fair play and justice that a reasonable opportunity to be informed must be afforded to the people
who are commanded to obey before they can be punished for its violation," (People v. de Dios, G.R. No. L-11003,
August 31, 1959, per the late Chief Justice Paras) citing the settled principle based on due process enunciated in
earlier cases that "before the public is bound by its contents. especially its penal provisions, a law, regulation or
circular must first be published and the people officially and specially informed of said contents and its penalties."
Without official publication in the Official Gazette as required by Article 2 of the Civil Code and Revised
Administrative Code, there would be no basis nor justification for the corollary rule of Article 3 of the Civil Code
(based on constructive notice that the provisions of the law are ascertainable from the public and official repository
where they are duly published) that "Ignorance of the law excuses no one from compliance therewith."
2. ID.; ID.; ID.; RESPONDENTS CONTENTION THAT "ONLY LAWS WHICH ARE SILENT AS TO THEIR
EFFECTIVITY DATE NEED TO BE PUBLISHED IN THE OFFICIAL GAZETTE FOR THEIR EFFECTIVITY,"
UNTENABLE. The plain text and meaning of the Civil Code is that "laws shall take effect after fifteen days
following the completion of their publication in the Official Gazette, unless it is otherwise provided," i.e. a different
effectivity date is provided by the law itself. This proviso perforce refers to a law that had been duly published
pursuant to the basic constitutional requirements of due process. The best example of this is the Civil Code itself:
the same Article 2 provides otherwise that it "shall take effect (only) one year (not 15 days) after such publication."
To sustain respondents misreading that "most laws or decrees specify the date of their effectivity and for this reason,
publication in the Official Gazette is not necessary for their effectivity" would be to nullify and render nugatory the
Civil Codes indispensable and essential requirement of prior publication in the Official Gazette by the simple
expedient of providing for immediate effectivity or an earlier effectivity date in the law itself before the completion of
15 days following its publication which is the period generally fixed by the Civil Code for its proper dissemination.
MELENCIO-HERRERA, J., concurring

CONSTITUTIONAL LAW; STATUTES; PUBLICATION IN THE OFFICIAL GAZETTE; RETROACTIVITY IN

EFFECTIVITY DATE NOT ALLOWED WHERE IT WILL RUN COUNTER TO CONSTITUTIONAL RIGHTS OR
DESTROY VESTED RIGHTS. There cannot be any question but that even if a decree provides for a date of
effectivity, it has to be published. When a date effectivity is mentioned in the decree but the decree becomes
effective only fifteen (15) days after its publication in the Official Gazette, it will not mean that the decree can have
retroactive effect to the date of effectivity mentioned in the decree itself. There should be no retroactivity if the
retroactivity will run counter to constitutional rights or shall destroy vested rights.
PLANA, J., separate opinion:
1. CONSTITUTIONAL LAW; STATUTES; PUBLICATION IN THE OFFICIAL GAZETTE NOT ESSENTIAL FOR
EFFECTIVITY FOR EFFECTIVITY OF LAWS. The Philippine Constitution does not require the publication of
laws as a prerequisite for their effectivity, unlike some Constitutions elsewhere. It may be said though that the
guarantee of due process requires notice of laws to affected parties before they can be bound thereby; but such
notice is not necessarily by publication in the Official Gazette. The due process clause is not that precise. Neither is
the publication in the Official Gazette required by any statute as a prerequisite for their effectivity, if said laws already
provide
for
their
effectivity
date.
2. ID.; ID.; PUBLICATION MAY BE MADE ELSEWHERE THAN IN THE OFFICIAL GAZETTE. Article 2 of the
Civil Code provides that "laws shall take effect after fifteen days following the completion of their publication in the
Official Gazette, unless it is otherwise provided." Two things may be said of this provision: Firstly, it obviously does
not apply to a law with a built-in provision as to when it will take effect. Secondly, it clearly recognizes that each law
may provide not only a different period for reckoning its effectivity date but also a different mode of notice. Thus, a
law may prescribe that it shall be published elsewhere than in the Official Gazette.
3. ID.; ID.; COMMONWEALTH ACT 638 CANNOT NULLIFY OR RESTRICT OPERATION OF A STATUTE WITH A
PROVISION AS TO ITS EFFECTIVITY. Not all legislative acts are required to be published in the Official Gazette
but only "important" ones "of a public nature." Moreover, Commonwealth Act No. 638 does not provide that
publication in the Official Gazette is essential for the effectivity of laws. This is as it should be, for all statutes are
equal and stand on the same footing. A law, especially an earlier one of general application such as Commonwealth
Act No. 638, cannot nullify or restrict the operation of a subsequent statute that has a provision of its own as to
when and how it will take effect. Only a higher law, which is the Constitution, can assume the role.
DECISION
Invoking the people's right to be informed on matters of public concern, a right recognized in Section 6, Article IV of
the 1973 Philippine Constitution, 1 as well as the principle that laws to be valid and enforceable must be published in
the Official Gazette or otherwise effectively promulgated, petitioners seek a writ of mandamus to compel respondent
public officials to publish, and/or cause the publication in the Official Gazette of various presidential decrees, letters
of instructions, general orders, proclamations, executive orders, letter of implementation and administrative orders.
The respondents, through the Solicitor General, would have this case dismissed outright on the ground that
petitioners have no legal personality or standing to bring the instant petition. The view is submitted that in the
absence of any showing that petitioners are personally and directly affected or prejudiced by the alleged nonpublication of the presidential issuances in question 2 said petitioners are without the requisite legal personality to
institute this mandamus proceeding, they are not being "aggrieved parties" within the meaning of Section 3, Rule 65
of the Rules of Court, which we quote:
SEC. 3. Petition for Mandamus.When any tribunal, corporation, board or person unlawfully
neglects the performance of an act which the law specifically enjoins as a duty resulting from an
office, trust, or station, or unlawfully excludes another from the use a rd enjoyment of a right or office
to which such other is entitled, and there is no other plain, speedy and adequate remedy in the
ordinary course of law, the person aggrieved thereby may file a verified petition in the proper court
alleging the facts with certainty and praying that judgment be rendered commanding the defendant,
immediately or at some other specified time, to do the act required to be done to Protect the rights of

the petitioner, and to pay the damages sustained by the petitioner by reason of the wrongful acts of
the defendant.
Upon the other hand, petitioners maintain that since the subject of the petition concerns a public right and its object
is to compel the performance of a public duty, they need not show any specific interest for their petition to be given
due course.
The issue posed is not one of first impression. As early as the 1910 case of Severino vs. Governor General, 3 this
Court held that while the general rule is that "a writ of mandamus would be granted to a private individual only in
those cases where he has some private or particular interest to be subserved, or some particular right to be
protected, independent of that which he holds with the public at large," and "it is for the public officers exclusively to
apply for the writ when public rights are to be subserved [Mithchell vs. Boardmen, 79 M.e., 469]," nevertheless,
"when the question is one of public right and the object of the mandamus is to procure the enforcement of a public
duty, the people are regarded as the real party in interest and the relator at whose instigation the proceedings are
instituted need not show that he has any legal or special interest in the result, it being sufficient to show that he is a
citizen and as such interested in the execution of the laws [High, Extraordinary Legal Remedies, 3rd ed., sec. 431].
Thus, in said case, this Court recognized the relator Lope Severino, a private individual, as a proper party to the
mandamus proceedings brought to compel the Governor General to call a special election for the position of
municipal president in the town of Silay, Negros Occidental. Speaking for this Court, Mr. Justice Grant T. Trent said:
We are therefore of the opinion that the weight of authority supports the proposition that the relator is
a proper party to proceedings of this character when a public right is sought to be enforced. If the
general rule in America were otherwise, we think that it would not be applicable to the case at bar for
the reason 'that it is always dangerous to apply a general rule to a particular case without keeping in
mind the reason for the rule, because, if under the particular circumstances the reason for the rule
does not exist, the rule itself is not applicable and reliance upon the rule may well lead to error'
No reason exists in the case at bar for applying the general rule insisted upon by counsel for the
respondent. The circumstances which surround this case are different from those in the United
States, inasmuch as if the relator is not a proper party to these proceedings no other person could
be, as we have seen that it is not the duty of the law officer of the Government to appear and
represent the people in cases of this character.
The reasons given by the Court in recognizing a private citizen's legal personality in the aforementioned case apply
squarely to the present petition. Clearly, the right sought to be enforced by petitioners herein is a public right
recognized by no less than the fundamental law of the land. If petitioners were not allowed to institute this
proceeding, it would indeed be difficult to conceive of any other person to initiate the same, considering that the
Solicitor General, the government officer generally empowered to represent the people, has entered his appearance
for respondents in this case.
Respondents further contend that publication in the Official Gazette is not a sine qua non requirement for the
effectivity of laws where the laws themselves provide for their own effectivity dates. It is thus submitted that since
the presidential issuances in question contain special provisions as to the date they are to take effect, publication in
the Official Gazette is not indispensable for their effectivity. The point stressed is anchored on Article 2 of the Civil
Code:
Art. 2. Laws shall take effect after fifteen days following the completion of their publication in the
Official Gazette, unless it is otherwise provided, ...

The interpretation given by respondent is in accord with this Court's construction of said article. In a long line of
decisions, 4 this Court has ruled that publication in the Official Gazette is necessary in those cases where the
legislation itself does not provide for its effectivity date-for then the date of publication is material for determining its
date of effectivity, which is the fifteenth day following its publication-but not when the law itself provides for the date
when it goes into effect.
Respondents' argument, however, is logically correct only insofar as it equates the effectivity of laws with the fact of
publication. Considered in the light of other statutes applicable to the issue at hand, the conclusion is easily reached
that said Article 2 does not preclude the requirement of publication in the Official Gazette, even if the law itself
provides for the date of its effectivity. Thus, Section 1 of Commonwealth Act 638 provides as follows:
Section 1. There shall be published in the Official Gazette [1] all important legisiative acts and
resolutions of a public nature of the, Congress of the Philippines; [2] all executive and administrative
orders and proclamations, except such as have no general applicability; [3] decisions or abstracts of
decisions of the Supreme Court and the Court of Appeals as may be deemed by said courts of
sufficient importance to be so published; [4] such documents or classes of documents as may be
required so to be published by law; and [5] such documents or classes of documents as the
President of the Philippines shall determine from time to time to have general applicability and legal
effect, or which he may authorize so to be published. ...
The clear object of the above-quoted provision is to give the general public adequate notice of the various laws
which are to regulate their actions and conduct as citizens. Without such notice and publication, there would be no
basis for the application of the maxim "ignorantia legis non excusat." It would be the height of injustice to punish or
otherwise burden a citizen for the transgression of a law of which he had no notice whatsoever, not even a
constructive one.
Perhaps at no time since the establishment of the Philippine Republic has the publication of laws taken so vital
significance that at this time when the people have bestowed upon the President a power heretofore enjoyed solely
by the legislature. While the people are kept abreast by the mass media of the debates and deliberations in the
Batasan Pambansaand for the diligent ones, ready access to the legislative recordsno such publicity
accompanies the law-making process of the President. Thus, without publication, the people have no means of
knowing what presidential decrees have actually been promulgated, much less a definite way of informing
themselves of the specific contents and texts of such decrees. As the Supreme Court of Spain ruled: "Bajo la
denominacion generica de leyes, se comprenden tambien los reglamentos, Reales decretos, Instrucciones,
Circulares y Reales ordines dictadas de conformidad con las mismas por el Gobierno en uso de su potestad. 5
The very first clause of Section I of Commonwealth Act 638 reads: "There shall be published in the Official
Gazette ... ." The word "shall" used therein imposes upon respondent officials an imperative duty. That duty must be
enforced if the Constitutional right of the people to be informed on matters of public concern is to be given
substance and reality. The law itself makes a list of what should be published in the Official Gazette. Such listing, to
our mind, leaves respondents with no discretion whatsoever as to what must be included or excluded from such
publication.
The publication of all presidential issuances "of a public nature" or "of general applicability" is mandated by law.
Obviously, presidential decrees that provide for fines, forfeitures or penalties for their violation or otherwise impose a
burden or. the people, such as tax and revenue measures, fall within this category. Other presidential issuances
which apply only to particular persons or class of persons such as administrative and executive orders need not be
published on the assumption that they have been circularized to all concerned. 6

It is needless to add that the publication of presidential issuances "of a public nature" or "of general applicability" is a
requirement of due process. It is a rule of law that before a person may be bound by law, he must first be officially
and specifically informed of its contents. As Justice Claudio Teehankee said in Peralta vs. COMELEC 7:
In a time of proliferating decrees, orders and letters of instructions which all form part of the law of
the land, the requirement of due process and the Rule of Law demand that the Official Gazette as
the official government repository promulgate and publish the texts of all such decrees, orders and
instructions so that the people may know where to obtain their official and specific contents.
The Court therefore declares that presidential issuances of general application, which have not been published,
shall have no force and effect. Some members of the Court, quite apprehensive about the possible unsettling effect
this decision might have on acts done in reliance of the validity of those presidential decrees which were published
only during the pendency of this petition, have put the question as to whether the Court's declaration of invalidity
apply to P.D.s which had been enforced or implemented prior to their publication. The answer is all too familiar. In
similar situations in the past this Court had taken the pragmatic and realistic course set forth in Chicot County
Drainage District vs. Baxter Bank 8 to wit:
The courts below have proceeded on the theory that the Act of Congress, having been found to be
unconstitutional, was not a law; that it was inoperative, conferring no rights and imposing no duties,
and hence affording no basis for the challenged decree. Norton v. Shelby County, 118 U.S. 425, 442;
Chicago, 1. & L. Ry. Co. v. Hackett, 228 U.S. 559, 566. It is quite clear, however, that such broad
statements as to the effect of a determination of unconstitutionality must be taken with qualifications.
The actual existence of a statute, prior to such a determination, is an operative fact and may have
consequences which cannot justly be ignored. The past cannot always be erased by a new judicial
declaration. The effect of the subsequent ruling as to invalidity may have to be considered in various
aspects-with respect to particular conduct, private and official. Questions of rights claimed to have
become vested, of status, of prior determinations deemed to have finality and acted upon
accordingly, of public policy in the light of the nature both of the statute and of its previous
application, demand examination. These questions are among the most difficult of those which have
engaged the attention of courts, state and federal and it is manifest from numerous decisions that an
all-inclusive statement of a principle of absolute retroactive invalidity cannot be justified.
Consistently with the above principle, this Court in Rutter vs. Esteban 9 sustained the right of a party under the
Moratorium Law, albeit said right had accrued in his favor before said law was declared unconstitutional by this
Court.
Similarly, the implementation/enforcement of presidential decrees prior to their publication in the Official Gazette is
"an operative fact which may have consequences which cannot be justly ignored. The past cannot always be erased
by a new judicial declaration ... that an all-inclusive statement of a principle of absolute retroactive invalidity cannot
be justified."
From the report submitted to the Court by the Clerk of Court, it appears that of the presidential decrees sought by
petitioners to be published in the Official Gazette, only Presidential Decrees Nos. 1019 to 1030, inclusive, 1278, and
1937 to 1939, inclusive, have not been so published. 10 Neither the subject matters nor the texts of these PDs can
be ascertained since no copies thereof are available. But whatever their subject matter may be, it is undisputed that
none of these unpublished PDs has ever been implemented or enforced by the government. In Pesigan vs.
Angeles, 11 the Court, through Justice Ramon Aquino, ruled that "publication is necessary to apprise the public of the
contents of [penal] regulations and make the said penalties binding on the persons affected thereby. " The cogency
of this holding is apparently recognized by respondent officials considering the manifestation in their comment that
"the government, as a matter of policy, refrains from prosecuting violations of criminal laws until the same shall have

been published in the Official Gazette or in some other publication, even though some criminal laws provide that
they shall take effect immediately.
WHEREFORE, the Court hereby orders respondents to publish in the Official Gazette all unpublished presidential
issuances which are of general application, and unless so published, they shall have no binding force and effect.
SO ORDERED.
Case Digest: Taada vs. Tuvera
G.R. No. L-63915 (146 SCRA 446) April 24, 1985
Taada vs. Tuvera
FACTS:
Petitioners sought a writ of mandamus to compel respondent public officials to publish, and/or cause the publication
in the Official Gazette of various presidential decrees, letters of instructions, general orders, proclamations,
executive orders, letter of implementation and administrative orders, invoking the right to be informed on matters of
public concern as recognized by the 1973 constitution.
ISSUE:
Whether or not the publication of presidential decrees, letters of instructions, general orders, proclamations,
executive orders, letter of implementation and administrative orders is necessary before its enforcement.
RULING:
Article 2 of the Civil Code provides that laws shall take effect after fifteen days following the completion of their
publication in the Official Gazette, unless it is otherwise provided The Court has ruled that publication in the Official
Gazette is necessary in those cases where the legislation itself does not provide for its effectivity date-for then the
date of publication is material for determining its date of effectivity, which is the fifteenth day following its publicationbut not when the law itself provides for the date when it goes into effect. Article 2 does not preclude the requirement
of publication in the Official Gazette, even if the law itself provides for the date of its effectivity.
The publication of all presidential issuances of a public nature or of general applicability is mandated by law.
Obviously, presidential decrees that provide for fines, forfeitures or penalties for their violation or otherwise impose a
burden or. the people, such as tax and revenue measures, fall within this category. Other presidential issuances
which apply only to particular persons or class of persons such as administrative and executive orders need not be
published on the assumption that they have been circularized to all concerned.
Publication is, therefore, mandatory.
TAADA VS. TUVERA
Publication in the Official Gazette (Enforceability of a Statute)
FACTS:
Invoking the right of the people to be informed on matters of public concern as well as the principle that laws to be
valid and enforceable must be published in the Official Gazette, petitioners filed for writ of mandamus to compel
respondent public officials to publish and/or cause to publish various presidential decrees, letters of instructions,
general orders, proclamations, executive orders, letters of implementations and administrative orders.
The Solicitor General, representing the respondents, moved for the dismissal of the case, contending that
petitioners
have
no
legal
personality
to
bring
the
instant
petition.
ISSUE:
Whether or not publication in the Official Gazette is required before any law or statute becomes valid and
enforceable.
HELD:
Art. 2 of the Civil Code does not preclude the requirement of publication in the Official Gazette, even if the law itself
provides for the date of its effectivity. The clear object of this provision is to give the general public adequate notice
of the various laws which are to regulate their actions and conduct as citizens. Without such notice and publication,
there would be no basis for the application of the maxim ignoratia legis nominem excusat. It would be the height of
injustive to punish or otherwise burden a citizen for the transgression of a law which he had no notice whatsoever,
not
even
a
constructive
one.
The very first clause of Section 1 of CA 638 reads: there shall be published in the Official Gazette. The word
shall therein imposes upon respondent officials an imperative duty. That duty must be enforced if the constitutional
right of the people to be informed on matter of public concern is to be given substance and validity.
The publication of presidential issuances of public nature or of general applicability is a requirement of due process.
It is a rule of law that before a person may be bound by law, he must first be officially and specifically informed of its
contents. The Court declared that presidential issuances of general application which have not been published have
no force and effect.

G. R. No. 187587, June 05, 2013 - NAGKAKAISANG MARALITA NG SITIO MASIGASIG, INC., Petitioner, v.
MILITARY SHRINE SERVICES PHILIPPINE VETERANS AFFAIRS OFFICE, DEPARTMENT OF NATIONAL
DEFENSE, Respondent.; G. R. NO. 187654, June 05, 2013 - WESTERN BICUTAN LOT OWNERS
ASSOCIATION, INC., REPRESENTED BY ITS BOARD OF DIRECTORS, Petitioner, v. MILITARY SHRINE
SERVICES PHILIPPINE VETERANS AFFAIRS OFFICE, DEPARTMENT OF NATIONAL DEFENSE,
Respondent.
RESOLUTION
[G. R. NO. 187654]
WESTERN BICUTAN LOT OWNERS ASSOCIATION, INC., REPRESENTED BY ITS BOARD OF
DIRECTORS, Petitioner, v. MILITARY SHRINE SERVICES PHILIPPINE VETERANS AFFAIRS OFFICE,
DEPARTMENT
OF
NATIONAL
DEFENSE, Respondent.
DECISION
SERENO, C.J.:
Before us are consolidated Petitions for Review under Rule 45 of the Rules of Court assailing the
Decision1 promulgated on 29 April 2009 of the Court of Appeals in CA-G.R. SP No. 97925.
THE FACTS
The facts, as culled from the records, are as follows:
On 12 July 1957, by virtue of Proclamation No. 423, President Carlos P. Garcia reserved parcels of land in the
Municipalities of Pasig, Taguig, Paraaque, Province of Rizal and Pasay City for a military reservation. The military
reservation, then known as Fort William McKinley, was later on renamed Fort Andres Bonifacio (Fort Bonifacio).
On 28 May 1967, President Ferdinand E. Marcos (President Marcos) issued Proclamation No. 208, amending
Proclamation No. 423, which excluded a certain area of Fort Bonifacio and reserved it for a national shrine. The
excluded area is now known as Libingan ng mga Bayani, which is under the administration of herein respondent
Military
Shrine
Services

Philippine
Veterans
Affairs
Office
(MSS-PVAO).
Again, on 7 January 1986, President Marcos issued Proclamation No. 2476, further amending Proclamation No.
423, which excluded barangays Lower Bicutan, Upper Bicutan and Signal Village from the operation of Proclamation
No. 423 and declared it open for disposition under the provisions of Republic Act Nos. (R.A.) 274 and 730.
At the bottom of Proclamation No. 2476, President Marcos made a handwritten addendum, which reads:
P.S. This includes Western Bicutan
(SGD.) Ferdinand E. Marcos2
The crux of the controversy started when Proclamation No. 2476 was published in the Official Gazette3 on 3
February
1986,
without
the
above-quoted
addendum.
Years later, on 16 October 1987, President Corazon C. Aquino (President Aquino) issued Proclamation No. 172
which substantially reiterated Proclamation No. 2476, as published, but this time excluded Lots 1 and 2 of Western
Bicutan from the operation of Proclamation No. 423 and declared the said lots open for disposition under the
provisions
of
R.A.
274
and
730.
Memorandum Order No. 119, implementing Proclamation No. 172, was issued on the same day.
Through the years, informal settlers increased and occupied some areas of Fort Bonifacio including portions of
the Libingan ng mga Bayani. Thus, Brigadier General Fredelito Bautista issued General Order No. 1323 creating
Task Force Bantay (TFB), primarily to prevent further unauthorized occupation and to cause the demolition of illegal
structures at Fort Bonifacio.
On 27 August 1999, members of petitioner Nagkakaisang Maralita ng Sitio Masigasig, Inc. (NMSMI) filed a Petition
with the Commission on Settlement of Land Problems (COSLAP), where it was docketed as COSLAP Case No. 99434. The Petition prayed for the following: (1) the reclassification of the areas they occupied, covering Lot 3 of SWO13-000-298 of Western Bicutan, from public land to alienable and disposable land pursuant to Proclamation No.
2476; (2) the subdivision of the subject lot by the Director of Lands; and (3) the Land Management Bureaus
facilitation of the distribution and sale of the subject lot to its bona fide occupants. 4

On 1 September 2000, petitioner Western Bicutan Lot Owners Association, Inc. (WBLOAI) filed a Petition-inIntervention substantially praying for the same reliefs as those prayed for by NMSMI with regard to the area the
former then occupied covering Lot 7 of SWO-00-001302 in Western Bicutan. 5
Thus, on 1 September 2006, COSLAP issued a Resolution 6 granting the Petition and declaring the portions of land
in question alienable and disposable, with Associate Commissioner Lina Aguilar-General dissenting. 7
The COSLAP ruled that the handwritten addendum of President Marcos was an integral part of Proclamation No.
2476, and was therefore, controlling. The intention of the President could not be defeated by the negligence or
inadvertence of others. Further, considering that Proclamation No. 2476 was done while the former President was
exercising legislative powers, it could not be amended, repealed or superseded, by a mere executive enactment.
Thus, Proclamation No. 172 could not have superseded much less displaced Proclamation No. 2476, as the latter
was issued on October 16, 1987 when President Aquinos legislative power had ceased.
In her Dissenting Opinion, Associate Commissioner Lina Aguilar-General stressed that pursuant to Article 2 of the
Civil Code, publication is indispensable in every case. Likewise, she held that when the provision of the law is clear
and unambiguous so that there is no occasion for the court to look into legislative intent, the law must be taken as it
is, devoid of judicial addition or subtraction. 8 Finally, she maintained that the Commission had no authority to supply
the addendum originally omitted in the published version of Proclamation No. 2476, as to do so would be
tantamount to encroaching on the field of the legislature.
Herein respondent MSS-PVAO filed a Motion for Reconsideration, 9 which was denied by the COSLAP in a
Resolution dated 24 January 2007.10
MSS-PVAO filed a Petition with the Court of Appeals seeking to reverse the COSLAP Resolutions dated 1
September 2006 and 24 January 2007.
Thus, on 29 April 2009, the then Court of Appeals First Division rendered the assailed Decision granting MSSPVAOs Petition, the dispositive portion of which reads:
IN VIEW OF ALL THE FOREGOING, the instant petition is hereby GRANTED. The Resolutions dated September 1,
2006 and January 24, 2007 issued by the Commission on the Settlement of Land Problems in COSLAP Case No.
99-434 are hereby REVERSED and SET ASIDE. In lieu thereof, the petitions of respondents in COSLAP Case No.
99-434 are DISMISSED, for lack of merit, as discussed herein. Further, pending urgent motions filed by respondents
are
likewise DENIED.
SO ORDERED.11 (Emphasis in the original)
Both NMSMI12 and WBLOAI13 appealed the said Decision by filing their respective Petitions for Review with this
Court under Rule 45 of the Rules of Court.
THE ISSUES
Petitioner NMSMI raises the following issues:
I
WHETHER OR NOT THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN RULING THAT
PROCLAMATION NO. 2476 DID NOT INCLUDE ANY PORTION OF WESTERN BICUTAN AS THE
HANDWRITTEN NOTATION BY PRESIDENT MARCOS ON THE SAID PROCLAMATION WAS NOT PUBLISHED
IN THE OFFICIAL GAZETTE.
II
WHETHER OR NOT THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN RULING THAT
PROCLAMATION NO. 172 LIKEWISE EXCLUDED THE PORTION OF LAND OCCUPIED BY MEMBER OF
HEREIN PETITIONER.
III
WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN NOT CONSIDERING THAT THE HON.
COSLAP HAS BROAD POWERS TO RECOMMEND TO THE PRESIDENT INNOVATIVE MEASURES TO
RESOLVE EXPEDITIOUSLY VARIOUS LAND CASES.14
On the other hand, petitioner WBLOAI raises this sole issue:cralavvonlinelawlibrary
WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT THE SUBJECT
PROPERTY WAS NOT DECLARED ALIENABLE AND DISPOSABLE BY VIRTUE OF PROCLAMATION NO. 2476
BECAUSE THE HANDWRITTEN ADDENDUM OF PRESIDENT FERDINAND E. MARCOS INCLUDING WESTERN
BICUTAN IN PROCLAMATION NO. 2476 WAS NOT INCLUDED IN THE PUBLICATION. 15

Both Petitions boil down to the principal issue of whether the Court of Appeals erred in ruling that the subject lots
were not alienable and disposable by virtue of Proclamation No. 2476 on the ground that the handwritten addendum
of President Marcos was not included in the publication of the said law.
THE COURTS RULING
We deny the Petitions for lack of merit.
Considering that petitioners were occupying Lots 3 and 7 of Western Bicutan (subject lots), their claims were
anchored on the handwritten addendum of President Marcos to Proclamation No. 2476. They allege that the former
President intended to include all Western Bicutan in the reclassification of portions of Fort Bonifacio as disposable
public land when he made a notation just below the printed version of Proclamation No. 2476.
However, it is undisputed that the handwritten addendum was not included when Proclamation No. 2476 was
published in the Official Gazette.
The resolution of whether the subject lots were declared as reclassified and disposable lies in the determination of
whether the handwritten addendum of President Marcos has the force and effect of law. In relation thereto, Article 2
of the Civil Code expressly provides:
ART. 2. Laws shall take effect after fifteen days following the completion of their publication in the Official Gazette,
unless it is otherwise provided. This Code shall take effect one year after such publication.
Under the above provision, the requirement of publication is indispensable to give effect to the law, unless the law
itself has otherwise provided. The phrase unless otherwise provided refers to a different effectivity date other than
after fifteen days following the completion of the laws publication in the Official Gazette, but does not imply that the
requirement of publication may be dispensed with. The issue of the requirement of publication was already settled in
the landmark case Taada v. Hon. Tuvera,16 in which we had the occasion to rule thus:cralavvonlinelawlibrary
Publication is indispensable in every case, but the legislature may in its discretion provide that the usual
fifteen-day period shall be shortened or extended. An example, as pointed out by the present Chief Justice in his
separate concurrence in the original decision, is the Civil Code which did not become effective after fifteen days
from its publication in the Official Gazette but one year after such publication. The general rule did not apply
because
it
was
otherwise
provided.
It is not correct to say that under the disputed clause publication may be dispensed with altogether. The reason is
that such omission would offend due process insofar as it would deny the public knowledge of the laws that are
supposed to govern it. Surely, if the legislature could validly provide that a law shall become effective immediately
upon its approval notwithstanding the lack of publication (or after an unreasonably short period after publication), it
is not unlikely that persons not aware of it would be prejudiced as a result; and they would be so not because of a
failure to comply with it but simply because they did not know of its existence. Significantly, this is not true only of
penal laws as is commonly supposed. One can think of many non-penal measures, like a law on prescription, which
must also be communicated to the persons they may affect before they can begin to operate.
The term "laws" should refer to all laws and not only to those of general application, for strictly speaking all laws
relate to the people in general albeit there are some that do not apply to them directly. An example is a law granting
citizenship to a particular individual, like a relative of President Marcos who was decreed instant naturalization. It
surely cannot be said that such a law does not affect the public although it unquestionably does not apply directly to
all the people. The subject of such law is a matter of public interest which any member of the body politic
may question in the political forums or, if he is a proper party, even in the courts of justice. In fact, a law
without any bearing on the public would be invalid as an intrusion of privacy or as class legislation or as an ultra
vires act of the legislature. To be valid, the law must invariably affect the public interest even if it might be directly
applicable only to one individual, or some of the people only, and not to the public as a whole.
We hold therefore that all statutes, including those of local application and private laws, shall be published as
a condition for their effectivity, which shall begin fifteen days after publication unless a different effectivity
date is fixed by the legislature.
Covered by this rule are presidential decrees and executive orders promulgated by the President in the
exercise of legislative powers whenever the same are validly delegated by the legislature or, at present, directly
conferred by the Constitution. Administrative rules and regulations must also be published if their purpose is to
enforce
or
implement
existing
law
pursuant
also
to
a
valid
delegation.
x

Accordingly, even the charter of a city must be published notwithstanding that it applies to only a portion of the
national territory and directly affects only the inhabitants of that place. All presidential decrees must be
published, including even, say, those naming a public place after a favored individual or exempting him from certain
prohibitions or requirements. The circulars issued by the Monetary Board must be published if they are meant not
merely to interpret but to "fill in the details" of the Central Bank Act which that body is supposed to enforce.
x

We agree that the publication must be in full or it is no publication at all since its purpose is to inform the
public of the contents of the laws. As correctly pointed out by the petitioners, the mere mention of the number of
the presidential decree, the title of such decree, its whereabouts (e.g., "with Secretary Tuvera"), the supposed date
of effectivity, and in a mere supplement of the Official Gazette cannot satisfy the publication requirement. This is not
even substantial compliance. This was the manner, incidentally, in which the General Appropriations Act for FY
1975, a presidential decree undeniably of general applicability and interest, was "published" by the Marcos
administration. The evident purpose was to withhold rather than disclose information on this vital law.
x

Laws must come out in the open in the clear light of the sun instead of skulking in the shadows with their dark, deep
secrets. Mysterious pronouncements and rumored rules cannot be recognized as binding unless their
existence and contents are confirmed by a valid publication intended to make full disclosure and give
proper notice to the people. The furtive law is like a scabbarded saber that cannot feint, parry or cut unless the
naked blade is drawn. (Emphases supplied)
Applying the foregoing ruling to the instant case, this Court cannot rely on a handwritten note that was not
part of Proclamation No. 2476 as published. Without publication, the note never had any legal force and effect.
Furthermore, under Section 24, Chapter 6, Book I of the Administrative Code, [t]he publication of any law,
resolution or other official documents in the Official Gazette shall be prima facie evidence of its authority. Thus,
whether or not President Marcos intended to include Western Bicutan is not only irrelevant but speculative. Simply
put, the courts may not speculate as to the probable intent of the legislature apart from the words appearing in the
law.17 This Court cannot rule that a word appears in the law when, evidently, there is none. In Pagpalain Haulers,
Inc. v. Hon. Trajano,18 we ruled that [u]nder Article 8 of the Civil Code, [j]udicial decisions applying or interpreting
the laws or the Constitution shall form a part of the legal system of the Philippines. This does not mean, however,
that courts can create law. The courts exist for interpreting the law, not for enacting it. To allow otherwise would be
violative of the principle of separation of powers, inasmuch as the sole function of our courts is to apply or interpret
the laws, particularly where gaps or lacunae exist or where ambiguities becloud issues, but it will not arrogate unto
itself the task of legislating. The remedy sought in these Petitions is not judicial interpretation, but another
legislation that would amend the law to include petitioners lots in the reclassification.
WHEREFORE, in view of the foregoing, the instant petitions are hereby DENIED for lack of merit. The assailed
Decision of the Court of Appeals in CA-G.R. CV No. 97925 dated 29 April 2009 is AFFIRMED in toto. Accordingly,
this Courts status quo order dated 17 June 2009 is hereby LIFTED. Likewise, all pending motions to cite
respondent
in
contempt
is DENIED, having
been
rendered
moot.
No
costs.
SO ORDERED.

***In 1999, members of Nagkakaisang Maralita ng Sitio Masigasig, Inc. (NMSMI) filed a petition with the
Commission on Settlement of Land Problems (COSLAP) to convert the areas they were occupying in Western
Bicutan from public land to alienable land pursuant to Proclamation No. 2476. COSLAP granted the request, ruling
that despite the lack of publication of the addendum, the intention of President Marcos could not be defeated by the
negligence or inadvertence of others.
The Court of Appeals (CA) reversed the decision of COSLAP. On appeal, the Supreme Court (SC) sustained the
CA. It ruled that the Court cannot rely on a handwritten note that was not part of Proclamation No. 2476 as
published. Without publication, the note never had any legal force and effect.

It was undisputed that the handwritten addendum was not included when Proclamation No. 2476 was published in
the Official Gazette. The SC, however, noted that the issue of whether President Marcos intended to include
Western Bicutan in Proclamation No. 2476 was not only irrelevant but speculative. Courts cannot speculate on the
probable intent of the legislature apart from the words appearing in the law.
Citing Taada v. Hon. Tuvera, the SC also reiterated that requirement of publication is indispensable in order to give
effect to the law, unless the law itself has otherwise provided. The phrase unless otherwise provided refers to a
different effectivity date other than after fifteen days following the completion of the laws publication in the Official
Gazette. Nevertheless, this does not imply that the requirement of publication may be dispensed with
Publication is indispensable in every case, but the legislature may in its discretion provide that the usual fifteen-day
period shall be shortened or extended . . . It is not correct to say that under the disputed clause publication may be
dispensed with altogether. The reason is that such omission would offend due process insofar as it would deny the
public knowledge of the laws that are supposed to govern it.
The Court also cited those covered under the indispensible rule of publication
[a]ll statutes, including those of local application and private laws, shall be published as a condition for their
effectivity, which shall begin fifteen days after publication unless a different effectivity date is fixed by the legislature.
Covered by this rule are presidential decrees and executive orders promulgated by the President in the exercise of
legislative powers.
It is important to note that publication must be in full or it is no publication at all since its purpose is to inform the
public of the contents of the laws (Nagkakaisang Maralita ng Sitio Masigasig v. Military Shrine Services, G.R.
No. 187587, 5 June 2013, C.J. Sereno).

G.R. No. L-19650

September 29, 1966

CALTEX (PHILIPPINES), INC., petitioner-appellee,

vs.
ENRICO PALOMAR, in his capacity as THE POSTMASTER GENERAL, respondent-appellant.
Office
of
the
Solicitor
General
Ross, Selph and Carrascoso for petitioner and appellee.

for

respondent

and

appellant.

SYLLABUS
3. STATUTORY CONSTRUCTION; CONSTRUCTION DEFINED; CASE AT BAR. Construction is the art or
process of discovering and expounding the meaning and intention of the authors of the law with respect to its
application to a given case, where that intention is rendered doubtful, among others, by reason of the fact that the
given case is not explicitly provided for in the law (Black, Interpretation of Laws, p. 1). In the present case, the
question of whether or not the scheme proposed by the appellee is within the coverage of the prohibitive provisions
of the Postal Law inescapably requires an inquiry into the intended meaning of the words used therein. This is as
much a question of construction or interpretation as any other.
CASTRO, J.:
In the year 1960 the Caltex (Philippines) Inc. (hereinafter referred to as Caltex) conceived and laid the groundwork
for a promotional scheme calculated to drum up patronage for its oil products. Denominated "Caltex Hooded Pump
Contest", it calls for participants therein to estimate the actual number of liters a hooded gas pump at each Caltex
station will dispense during a specified period. Employees of the Caltex (Philippines) Inc., its dealers and its
advertising agency, and their immediate families excepted, participation is to be open indiscriminately to all "motor
vehicle owners and/or licensed drivers". For the privilege to participate, no fee or consideration is required to be
paid, no purchase of Caltex products required to be made. Entry forms are to be made available upon request at
each Caltex station where a sealed can will be provided for the deposit of accomplished entry stubs.
A three-staged winner selection system is envisioned. At the station level, called "Dealer Contest", the contestant
whose estimate is closest to the actual number of liters dispensed by the hooded pump thereat is to be awarded the
first prize; the next closest, the second; and the next, the third. Prizes at this level consist of a 3-burner kerosene
stove for first; a thermos bottle and a Ray-O-Vac hunter lantern for second; and an Everready Magnet-lite flashlight
with batteries and a screwdriver set for third. The first-prize winner in each station will then be qualified to join in the
"Regional Contest" in seven different regions. The winning stubs of the qualified contestants in each region will be
deposited in a sealed can from which the first-prize, second-prize and third-prize winners of that region will be
drawn. The regional first-prize winners will be entitled to make a three-day all-expenses-paid round trip to Manila,
accompanied by their respective Caltex dealers, in order to take part in the "National Contest". The regional secondprize and third-prize winners will receive cash prizes of P500 and P300, respectively. At the national level, the stubs
of the seven regional first-prize winners will be placed inside a sealed can from which the drawing for the final firstprize, second-prize and third-prize winners will be made. Cash prizes in store for winners at this final stage are:
P3,000 for first; P2,000 for second; Pl,500 for third; and P650 as consolation prize for each of the remaining four
participants.
Foreseeing the extensive use of the mails not only as amongst the media for publicizing the contest but also for the
transmission of communications relative thereto, representations were made by Caltex with the postal authorities for
the contest to be cleared in advance for mailing, having in view sections 1954(a), 1982 and 1983 of the Revised
Administrative Code, the pertinent provisions of which read as follows:

SECTION 1954. Absolutely non-mailable matter. No matter belonging to any of the following classes,
whether sealed as first-class matter or not, shall be imported into the Philippines through the mails, or to be
deposited in or carried by the mails of the Philippines, or be delivered to its addressee by any officer or
employee of the Bureau of Posts:
Written or printed matter in any form advertising, describing, or in any manner pertaining to, or conveying or
purporting to convey any information concerning any lottery, gift enterprise, or similar scheme depending in
whole or in part upon lot or chance, or any scheme, device, or enterprise for obtaining any money or
property of any kind by means of false or fraudulent pretenses, representations, or promises.
"SECTION 1982. Fraud orders.Upon satisfactory evidence that any person or company is engaged in
conducting any lottery, gift enterprise, or scheme for the distribution of money, or of any real or personal
property by lot, chance, or drawing of any kind, or that any person or company is conducting any scheme,
device, or enterprise for obtaining money or property of any kind through the mails by means of false or
fraudulent pretenses, representations, or promises, the Director of Posts may instruct any postmaster or
other officer or employee of the Bureau to return to the person, depositing the same in the mails, with the
word "fraudulent" plainly written or stamped upon the outside cover thereof, any mail matter of whatever
class mailed by or addressed to such person or company or the representative or agent of such person or
company.
SECTION 1983. Deprivation of use of money order system and telegraphic transfer service.The Director
of Posts may, upon evidence satisfactory to him that any person or company is engaged in conducting any
lottery, gift enterprise or scheme for the distribution of money, or of any real or personal property by lot,
chance, or drawing of any kind, or that any person or company is conducting any scheme, device, or
enterprise for obtaining money or property of any kind through the mails by means of false or fraudulent
pretenses, representations, or promise, forbid the issue or payment by any postmaster of any postal money
order or telegraphic transfer to said person or company or to the agent of any such person or company,
whether such agent is acting as an individual or as a firm, bank, corporation, or association of any kind, and
may provide by regulation for the return to the remitters of the sums named in money orders or telegraphic
transfers drawn in favor of such person or company or its agent.
The overtures were later formalized in a letter to the Postmaster General, dated October 31, 1960, in which the
Caltex, thru counsel, enclosed a copy of the contest rules and endeavored to justify its position that the contest does
not violate the anti-lottery provisions of the Postal Law. Unimpressed, the then Acting Postmaster General opined
that the scheme falls within the purview of the provisions aforesaid and declined to grant the requested clearance. In
its counsel's letter of December 7, 1960, Caltex sought a reconsideration of the foregoing stand, stressing that there
being involved no consideration in the part of any contestant, the contest was not, under controlling authorities,
condemnable as a lottery. Relying, however, on an opinion rendered by the Secretary of Justice on an unrelated
case seven years before (Opinion 217, Series of 1953), the Postmaster General maintained his view that the
contest involves consideration, or that, if it does not, it is nevertheless a "gift enterprise" which is equally banned by
the Postal Law, and in his letter of December 10, 1960 not only denied the use of the mails for purposes of the
proposed contest but as well threatened that if the contest was conducted, "a fraud order will have to be issued
against it (Caltex) and all its representatives".
Caltex thereupon invoked judicial intervention by filing the present petition for declaratory relief against Postmaster
General Enrico Palomar, praying "that judgment be rendered declaring its 'Caltex Hooded Pump Contest' not to be
violative of the Postal Law, and ordering respondent to allow petitioner the use of the mails to bring the contest to
the attention of the public". After issues were joined and upon the respective memoranda of the parties, the trial
court rendered judgment as follows:

In view of the foregoing considerations, the Court holds that the proposed 'Caltex Hooded Pump Contest'
announced to be conducted by the petitioner under the rules marked as Annex B of the petitioner does not
violate the Postal Law and the respondent has no right to bar the public distribution of said rules by the
mails.
The respondent appealed.
The parties are now before us, arrayed against each other upon two basic issues: first, whether the petition states a
sufficient cause of action for declaratory relief; and second, whether the proposed "Caltex Hooded Pump Contest"
violates the Postal Law. We shall take these up in seriatim.
1. By express mandate of section 1 of Rule 66 of the old Rules of Court, which was the applicable legal basis for the
remedy at the time it was invoked, declaratory relief is available to any person "whose rights are affected by a
statute . . . to determine any question of construction or validity arising under the . . . statute and for a declaration of
his rights thereunder" (now section 1, Rule 64, Revised Rules of Court). In amplification, this Court, conformably to
established jurisprudence on the matter, laid down certain conditions sine qua non therefor, to wit: (1) there must be
a justiciable controversy; (2) the controversy must be between persons whose interests are adverse; (3) the party
seeking declaratory relief must have a legal interest in the controversy; and (4) the issue involved must be ripe for
judicial determination (Tolentino vs. The Board of Accountancy, et al., G.R. No. L-3062, September 28, 1951;
Delumen, et al. vs. Republic of the Philippines, 50 O.G., No. 2, pp. 576, 578-579; Edades vs. Edades, et al., G.R.
No. L-8964, July 31, 1956). The gravamen of the appellant's stand being that the petition herein states no sufficient
cause of action for declaratory relief, our duty is to assay the factual bases thereof upon the foregoing crucible.
As we look in retrospect at the incidents that generated the present controversy, a number of significant points stand
out in bold relief. The appellee (Caltex), as a business enterprise of some consequence, concededly has the
unquestioned right to exploit every legitimate means, and to avail of all appropriate media to advertise and stimulate
increased patronage for its products. In contrast, the appellant, as the authority charged with the enforcement of the
Postal Law, admittedly has the power and the duty to suppress transgressions thereof particularly thru the
issuance of fraud orders, under Sections 1982 and 1983 of the Revised Administrative Code, against legally nonmailable schemes. Obviously pursuing its right aforesaid, the appellee laid out plans for the sales promotion scheme
hereinbefore detailed. To forestall possible difficulties in the dissemination of information thereon thru the mails,
amongst other media, it was found expedient to request the appellant for an advance clearance therefor. However,
likewise by virtue of his jurisdiction in the premises and construing the pertinent provisions of the Postal Law, the
appellant saw a violation thereof in the proposed scheme and accordingly declined the request. A point of difference
as to the correct construction to be given to the applicable statute was thus reached. Communications in which the
parties expounded on their respective theories were exchanged. The confidence with which the appellee insisted
upon its position was matched only by the obstinacy with which the appellant stood his ground. And this impasse
was climaxed by the appellant's open warning to the appellee that if the proposed contest was "conducted, a fraud
order will have to be issued against it and all its representatives."
Against this backdrop, the stage was indeed set for the remedy prayed for. The appellee's insistent assertion of its
claim to the use of the mails for its proposed contest, and the challenge thereto and consequent denial by the
appellant of the privilege demanded, undoubtedly spawned a live controversy. The justiciability of the dispute cannot
be gainsaid. There is an active antagonistic assertion of a legal right on one side and a denial thereof on the other,
concerning a real not a mere theoretical question or issue. The contenders are as real as their interests are
substantial. To the appellee, the uncertainty occasioned by the divergence of views on the issue of construction
hampers or disturbs its freedom to enhance its business. To the appellant, the suppression of the appellee's
proposed contest believed to transgress a law he has sworn to uphold and enforce is an unavoidable duty. With the
appellee's bent to hold the contest and the appellant's threat to issue a fraud order therefor if carried out, the
contenders are confronted by the ominous shadow of an imminent and inevitable litigation unless their differences
are settled and stabilized by a tranquilizing declaration (Pablo y Sen, et al. vs. Republic of the Philippines, G.R. No.

L-6868, April 30, 1955). And, contrary to the insinuation of the appellant, the time is long past when it can rightly be
said that merely the appellee's "desires are thwarted by its own doubts, or by the fears of others" which
admittedly does not confer a cause of action. Doubt, if any there was, has ripened into a justiciable controversy
when, as in the case at bar, it was translated into a positive claim of right which is actually contested (III Moran,
Comments on the Rules of Court, 1963 ed., pp. 132-133, citing: Woodward vs. Fox West Coast Theaters, 36 Ariz.,
251, 284 Pac. 350).
We cannot hospitably entertain the appellant's pretense that there is here no question of construction because the
said appellant "simply applied the clear provisions of the law to a given set of facts as embodied in the rules of the
contest", hence, there is no room for declaratory relief. The infirmity of this pose lies in the fact that it proceeds from
the assumption that, if the circumstances here presented, the construction of the legal provisions can be divorced
from the matter of their application to the appellee's contest. This is not feasible. Construction, verily, is the art or
process of discovering and expounding the meaning and intention of the authors of the law with respect to its
application to a given case, where that intention is rendered doubtful, amongst others, by reason of the fact that the
given case is not explicitly provided for in the law (Black, Interpretation of Laws, p. 1). This is precisely the case
here. Whether or not the scheme proposed by the appellee is within the coverage of the prohibitive provisions of the
Postal Law inescapably requires an inquiry into the intended meaning of the words used therein. To our mind, this is
as much a question of construction or interpretation as any other.
Nor is it accurate to say, as the appellant intimates, that a pronouncement on the matter at hand can amount to
nothing more than an advisory opinion the handing down of which is anathema to a declaratory relief action. Of
course, no breach of the Postal Law has as yet been committed. Yet, the disagreement over the construction thereof
is no longer nebulous or contingent. It has taken a fixed and final shape, presenting clearly defined legal issues
susceptible of immediate resolution. With the battle lines drawn, in a manner of speaking, the propriety nay, the
necessity of setting the dispute at rest before it accumulates the asperity distemper, animosity, passion and
violence of a full-blown battle which looms ahead (III Moran, Comments on the Rules of Court, 1963 ed., p. 132 and
cases cited), cannot but be conceded. Paraphrasing the language in Zeitlin vs. Arnebergh 59 Cal., 2d., 901, 31 Cal.
Rptr., 800, 383 P. 2d., 152, cited in 22 Am. Jur., 2d., p. 869, to deny declaratory relief to the appellee in the situation
into which it has been cast, would be to force it to choose between undesirable alternatives. If it cannot obtain a final
and definitive pronouncement as to whether the anti-lottery provisions of the Postal Law apply to its proposed
contest, it would be faced with these choices: If it launches the contest and uses the mails for purposes thereof, it
not only incurs the risk, but is also actually threatened with the certain imposition, of a fraud order with its
concomitant stigma which may attach even if the appellee will eventually be vindicated; if it abandons the contest, it
becomes a self-appointed censor, or permits the appellant to put into effect a virtual fiat of previous censorship
which is constitutionally unwarranted. As we weigh these considerations in one equation and in the spirit of liberality
with which the Rules of Court are to be interpreted in order to promote their object (section 1, Rule 1, Revised Rules
of Court) which, in the instant case, is to settle, and afford relief from uncertainty and insecurity with respect to,
rights and duties under a law we can see in the present case any imposition upon our jurisdiction or any futility or
prematurity in our intervention.
The appellant, we apprehend, underrates the force and binding effect of the ruling we hand down in this case if he
believes that it will not have the final and pacifying function that a declaratory judgment is calculated to subserve. At
the very least, the appellant will be bound. But more than this, he obviously overlooks that in this jurisdiction,
"Judicial decisions applying or interpreting the law shall form a part of the legal system" (Article 8, Civil Code of the
Philippines). In effect, judicial decisions assume the same authority as the statute itself and, until authoritatively
abandoned, necessarily become, to the extent that they are applicable, the criteria which must control the actuations
not only of those called upon to abide thereby but also of those in duty bound to enforce obedience thereto.
Accordingly, we entertain no misgivings that our resolution of this case will terminate the controversy at hand.
It is not amiss to point out at this juncture that the conclusion we have herein just reached is not without precedent.
In Liberty Calendar Co. vs. Cohen, 19 N.J., 399, 117 A. 2d., 487, where a corporation engaged in promotional

advertising was advised by the county prosecutor that its proposed sales promotion plan had the characteristics of a
lottery, and that if such sales promotion were conducted, the corporation would be subject to criminal prosecution, it
was held that the corporation was entitled to maintain a declaratory relief action against the county prosecutor to
determine the legality of its sales promotion plan. In pari materia, see also: Bunis vs. Conway, 17 App. Div. 2d., 207,
234 N.Y.S. 2d., 435; Zeitlin vs. Arnebergh, supra; Thrillo, Inc. vs. Scott, 15 N.J. Super. 124, 82 A. 2d., 903.
In fine, we hold that the appellee has made out a case for declaratory relief.
2. The Postal Law, chapter 52 of the Revised Administrative Code, using almost identical terminology in sections
1954(a), 1982 and 1983 thereof, supra, condemns as absolutely non-mailable, and empowers the Postmaster
General to issue fraud orders against, or otherwise deny the use of the facilities of the postal service to, any
information concerning "any lottery, gift enterprise, or scheme for the distribution of money, or of any real or personal
property by lot, chance, or drawing of any kind". Upon these words hinges the resolution of the second issue posed
in this appeal.
Happily, this is not an altogether untrodden judicial path. As early as in 1922, in "El Debate", Inc. vs. Topacio, 44
Phil., 278, 283-284, which significantly dwelt on the power of the postal authorities under the abovementioned
provisions of the Postal Law, this Court declared that
While countless definitions of lottery have been attempted, the authoritative one for this jurisdiction is that of
the United States Supreme Court, in analogous cases having to do with the power of the United States
Postmaster General, viz.: The term "lottery" extends to all schemes for the distribution of prizes by chance,
such as policy playing, gift exhibitions, prize concerts, raffles at fairs, etc., and various forms of gambling.
The three essential elements of a lottery are: First, consideration; second, prize; and third, chance. (Horner
vs. States [1892], 147 U.S. 449; Public Clearing House vs. Coyne [1903], 194 U.S., 497; U.S. vs. Filart and
Singson [1915], 30 Phil., 80; U.S. vs. Olsen and Marker [1917], 36 Phil., 395; U.S. vs. Baguio [1919], 39
Phil., 962; Valhalla Hotel Construction Company vs. Carmona, p. 233, ante.)
Unanimity there is in all quarters, and we agree, that the elements of prize and chance are too obvious in the
disputed scheme to be the subject of contention. Consequently as the appellant himself concedes, the field of
inquiry is narrowed down to the existence of the element of consideration therein. Respecting this matter, our task is
considerably lightened inasmuch as in the same case just cited, this Court has laid down a definitive yard-stick in
the following terms
In respect to the last element of consideration, the law does not condemn the gratuitous distribution of
property by chance, if no consideration is derived directly or indirectly from the party receiving the chance,
but does condemn as criminal schemes in which a valuable consideration of some kind is paid directly or
indirectly for the chance to draw a prize.
Reverting to the rules of the proposed contest, we are struck by the clarity of the language in which the invitation to
participate therein is couched. Thus
No puzzles, no rhymes? You don't need wrappers, labels or boxtops? You don't have to buy anything?
Simply estimate the actual number of liter the Caltex gas pump with the hood at your favorite Caltex dealer
will dispense from to , and win valuable prizes . . . ." .
Nowhere in the said rules is any requirement that any fee be paid, any merchandise be bought, any service be
rendered, or any value whatsoever be given for the privilege to participate. A prospective contestant has but to go to
a Caltex station, request for the entry form which is available on demand, and accomplish and submit the same for
the drawing of the winner. Viewed from all angles or turned inside out, the contest fails to exhibit any discernible
consideration which would brand it as a lottery. Indeed, even as we head the stern injunction, "look beyond the fair

exterior, to the substance, in order to unmask the real element and pernicious tendencies which the law is seeking
to prevent" ("El Debate", Inc. vs. Topacio, supra, p. 291), we find none. In our appraisal, the scheme does not only
appear to be, but actually is, a gratuitous distribution of property by chance.
There is no point to the appellant's insistence that non-Caltex customers who may buy Caltex products simply to win
a prize would actually be indirectly paying a consideration for the privilege to join the contest. Perhaps this would be
tenable if the purchase of any Caltex product or the use of any Caltex service were a pre-requisite to participation.
But it is not. A contestant, it hardly needs reiterating, does not have to buy anything or to give anything of
value.1awphl.nt
Off-tangent, too, is the suggestion that the scheme, being admittedly for sales promotion, would naturally benefit the
sponsor in the way of increased patronage by those who will be encouraged to prefer Caltex products "if only to get
the chance to draw a prize by securing entry blanks". The required element of consideration does not consist of the
benefit derived by the proponent of the contest. The true test, as laid down in People vs. Cardas, 28 P. 2d., 99, 137
Cal. App. (Supp.) 788, is whether the participant pays a valuable consideration for the chance, and not whether
those conducting the enterprise receive something of value in return for the distribution of the prize. Perspective
properly oriented, the standpoint of the contestant is all that matters, not that of the sponsor. The following, culled
from Corpus Juris Secundum, should set the matter at rest:
The fact that the holder of the drawing expects thereby to receive, or in fact does receive, some benefit in
the way of patronage or otherwise, as a result of the drawing; does not supply the element of
consideration.Griffith Amusement Co. vs. Morgan, Tex. Civ. App., 98 S.W., 2d., 844" (54 C.J.S., p. 849).
Thus enlightened, we join the trial court in declaring that the "Caltex Hooded Pump Contest" proposed by the
appellee is not a lottery that may be administratively and adversely dealt with under the Postal Law.
But it may be asked: Is it not at least a "gift enterprise, or scheme for the distribution of money, or of any real or
personal property by lot, chance, or drawing of any kind", which is equally prescribed? Incidentally, while the
appellant's brief appears to have concentrated on the issue of consideration, this aspect of the case cannot be
avoided if the remedy here invoked is to achieve its tranquilizing effect as an instrument of both curative and
preventive justice. Recalling that the appellant's action was predicated, amongst other bases, upon Opinion 217,
Series 1953, of the Secretary of Justice, which opined in effect that a scheme, though not a lottery for want of
consideration, may nevertheless be a gift enterprise in which that element is not essential, the determination of
whether or not the proposed contest wanting in consideration as we have found it to be is a prohibited gift
enterprise, cannot be passed over sub silencio.
While an all-embracing concept of the term "gift enterprise" is yet to be spelled out in explicit words, there appears
to be a consensus among lexicographers and standard authorities that the term is commonly applied to a sporting
artifice of under which goods are sold for their market value but by way of inducement each purchaser is given a
chance to win a prize (54 C.J.S., 850; 34 Am. Jur., 654; Black, Law Dictionary, 4th ed., p. 817; Ballantine, Law
Dictionary with Pronunciations, 2nd ed., p. 55; Retail Section of Chamber of Commerce of Plattsmouth vs. Kieck,
257 N.W., 493, 128 Neb. 13; Barker vs. State, 193 S.E., 605, 56 Ga. App., 705; Bell vs. State, 37 Tenn. 507, 509, 5
Sneed, 507, 509). As thus conceived, the term clearly cannot embrace the scheme at bar. As already noted, there is
no sale of anything to which the chance offered is attached as an inducement to the purchaser. The contest is open
to all qualified contestants irrespective of whether or not they buy the appellee's products.
Going a step farther, however, and assuming that the appellee's contest can be encompassed within the broadest
sweep that the term "gift enterprise" is capable of being extended, we think that the appellant's pose will gain no
added comfort. As stated in the opinion relied upon, rulings there are indeed holding that a gift enterprise involving
an award by chance, even in default of the element of consideration necessary to constitute a lottery, is prohibited
(E.g.: Crimes vs. States, 235 Ala 192, 178 So. 73; Russell vs. Equitable Loan & Sec. Co., 129 Ga. 154, 58 S.E., 88;

State ex rel. Stafford vs. Fox-Great Falls Theater Corporation, 132 P. 2d., 689, 694, 698, 114 Mont. 52). But this is
only one side of the coin. Equally impressive authorities declare that, like a lottery, a gift enterprise comes within the
prohibitive statutes only if it exhibits the tripartite elements of prize, chance and consideration (E.g.: Bills vs. People,
157 P. 2d., 139, 142, 113 Colo., 326; D'Orio vs. Jacobs, 275 P. 563, 565, 151 Wash., 297; People vs. Psallis, 12
N.Y.S., 2d., 796; City and County of Denver vs. Frueauff, 88 P., 389, 394, 39 Colo., 20, 7 L.R.A., N.S., 1131, 12 Ann.
Cas., 521; 54 C.J.S., 851, citing: Barker vs. State, 193 S.E., 605, 607, 56 Ga. App., 705; 18 Words and Phrases,
perm. ed., pp. 590-594). The apparent conflict of opinions is explained by the fact that the specific statutory
provisions relied upon are not identical. In some cases, as pointed out in 54 C.J.S., 851, the terms "lottery" and "gift
enterprise" are used interchangeably (Bills vs. People, supra); in others, the necessity for the element of
consideration or chance has been specifically eliminated by statute. (54 C.J.S., 351-352, citing Barker vs.
State, supra; State ex rel. Stafford vs. Fox-Great Falls Theater Corporation, supra). The lesson that we derive from
this state of the pertinent jurisprudence is, therefore, that every case must be resolved upon the particular
phraseology of the applicable statutory provision.
Taking this cue, we note that in the Postal Law, the term in question is used in association with the word "lottery".
With the meaning of lottery settled, and consonant to the well-known principle of legal hermeneutics noscitur a
sociis which Opinion 217 aforesaid also relied upon although only insofar as the element of chance is concerned
it is only logical that the term under a construction should be accorded no other meaning than that which is
consistent with the nature of the word associated therewith. Hence, if lottery is prohibited only if it involves a
consideration, so also must the term "gift enterprise" be so construed. Significantly, there is not in the law the
slightest indicium of any intent to eliminate that element of consideration from the "gift enterprise" therein included.
This conclusion firms up in the light of the mischief sought to be remedied by the law, resort to the determination
thereof being an accepted extrinsic aid in statutory construction. Mail fraud orders, it is axiomatic, are designed to
prevent the use of the mails as a medium for disseminating printed matters which on grounds of public policy are
declared non-mailable. As applied to lotteries, gift enterprises and similar schemes, justification lies in the
recognized necessity to suppress their tendency to inflame the gambling spirit and to corrupt public morals (Com.
vs. Lund, 15 A. 2d., 839, 143 Pa. Super. 208). Since in gambling it is inherent that something of value be hazarded
for a chance to gain a larger amount, it follows ineluctably that where no consideration is paid by the contestant to
participate, the reason behind the law can hardly be said to obtain. If, as it has been held
Gratuitous distribution of property by lot or chance does not constitute "lottery", if it is not resorted to as a
device to evade the law and no consideration is derived, directly or indirectly, from the party receiving the
chance, gambling spirit not being cultivated or stimulated thereby. City of Roswell vs. Jones, 67 P. 2d., 286,
41 N.M., 258." (25 Words and Phrases, perm. ed., p. 695, emphasis supplied).
we find no obstacle in saying the same respecting a gift enterprise. In the end, we are persuaded to hold that, under
the prohibitive provisions of the Postal Law which we have heretofore examined, gift enterprises and similar
schemes therein contemplated are condemnable only if, like lotteries, they involve the element of consideration.
Finding none in the contest here in question, we rule that the appellee may not be denied the use of the mails for
purposes thereof.
Recapitulating, we hold that the petition herein states a sufficient cause of action for declaratory relief, and that the
"Caltex Hooded Pump Contest" as described in the rules submitted by the appellee does not transgress the
provisions of the Postal Law.
ACCORDINGLY, the judgment appealed from is affirmed. No costs.

CASE DIGEST
Topic
I. STATUTORY COSNTRUCTION

1. Definition
Brief Case Title, Citation and Year of Decision
Caltex v. Palomar, 18 SCRA 247 (1966)
Facts (State only the pertinent facts)
Caltex came up with a promotion to increase public awareness to its products wherein any person
would simply go the Caltex service Station and fill-up form and make an estimate of the actual
consumption of the said gasoline station. The person to guess the nearest consumption of the
gasoline station in a day wins. The person entering the contest need not be a customer or (does
he need to) purchase any of Caltexs products. Foreseeing the possibility of using the mailing
system for the publication of the promo (As such), it wrote the Postmaster General for an authority
to use the mailing system for the said promotion. The postmaster denied this authority citing that
under the Revised Administrative Code, the same partakes of a lottery or a gift-enterprise which is
prohibited under the Revised Administrative Code. The Postmaster General threatened Caltex
with the issuance of a fraud order in case it pushes through with the use of the mailing system for
the dissemination of information regarding the said promo. Caltex asked for a reconsideration (of
the decision) from the Postmaster General, which the latter denied. Caltex then filed a case in
court for a declaratory relief. The court ruled in favor of Caltex declaring that there was no
violation of the Administrative Code. The Postmaster General appealed. Caltex invoked
Statutory Construction because there is an ambiguity in the interpretation of the terms Lottery
and Gift Enterprise as applied to the case. The Postmaster General opposed the use of
Statutory Construction because the law is clear and unequivocal.
Issue (State the pertinent issue to the case)
Whether or not Statutory Construction may be utilized to settle the controversy between the
parties.
Ruling / Held (State the ruling pertinent to the issue)
Yes. Statutory Construction is the art or process of discovering or ascertaining the intention of the
legislature, when the same has been rendered doubtful by reason of the ambiguity in the law or
the fact that a given case is not provided for by the law, and applying it to an interpretation of the
terms lottery or gift-enterprise as applied to the facts of the given case. Statutory Construction
may therefore be resorted to in order to settle the controversy.
***Se Scrbd file

G.R. No. 151424

July 31, 2009

EAGLE
REALTY
CORPORATION, Petitioner,
vs.
REPUBLIC OF THE PHILIPPINES Represented by the Administrator of the Land Registration Authority,
NATIONAL TREASURER OF THE PHILIPPINES, HEIRS OF CASIANO DE LEON and MARIA SOCORRO DE
LEON, Respondents.
RESOLUTION
NACHURA, J.:
Petitioner Eagle Realty Corporation seeks the reconsideration of this Courts Decision dated July 4, 2008, which
affirmed the Court of Appeals Decision dated January 22, 2001 and Resolution dated January 8, 2002, and upheld
the cancellation of petitioners certificate of title based on a finding that it is not a purchaser in good faith and for
value.
In the assailed decision, the Court held that "a corporation engaged in the buying and selling of real estate is
expected to exercise a higher standard of care and diligence in ascertaining the status and condition of the property
subject of its business transaction." Citing Sunshine Finance and Investment Corporation v. Intermediate Appellate
Court,1 the Court declared that, similar to investment and financing corporations, such corporation "cannot simply
rely on an examination of a Torrens certificate to determine what the subject property looks like as its condition is not
apparent in the document."
Petitioners Motion for Reconsideration centers on the application of Sunshine Finance to the present case.
Petitioner argues therein that the ruling in Sunshine Finance is a recent innovation, established long after the
subject property was transferred in petitioners name in 1984, hence, should not be applied to the case. Prior
jurisprudence that protected banks, investment corporations and realty companies, without imposing any additional
burden of going beyond the face of the title, should be applied instead. Petitioner points out that it purchased the
subject property in 1984, when prevailing jurisprudence did not, as yet, impose upon realty companies the obligation
to look beyond the certificate of title for it to qualify as an innocent purchaser for value. To charge petitioner with
such additional obligation is to burden it with a then non-existent obligation which thus violates its right to due
process.2
In its Comment, the Office of the Solicitor General (OSG) averred that the ruling in Sunshine Finance is not in the
nature of a statute that cannot be retroactively applied; it is jurisprudence that merely restates the definition of an
innocent purchaser for value.3
We agree with the OSG and, consequently, deny the motion for reconsideration.
Judicial interpretation of a statute constitutes part of the law as of the date it was originally passed, since the Courts
construction merely establishes the contemporaneous legislative intent that the interpreted law carried into effect.
Such judicial doctrine does not amount to the passage of a new law, but consists merely of a construction or
interpretation of a pre-existing one,4 as is the situation in this case. The assailed decision merely defines an
"innocent purchaser for value" with respect to entities engaged in the real estate business.1avvphi1
In Sunshine Finance, the Court required, for the first time, investment and financing corporations to take the
necessary precautions to ascertain if there were any flaws in the certificate of title and examine the condition of the
property they were dealing with. Although the property involved was mortgaged to and, subsequently, purchased by

therein petitioner several years before the said decision was promulgated, we note that the rule was immediately
applied to that case.
Our herein assailed ruling expands the ruling in Sunshine Finance to cover realty corporations, which, because of
the nature of their business, are, likewise, expected to exercise a higher standard of diligence in ascertaining the
status of the property, not merely rely on what appears on the face of a certificate of title. In like manner, our ruling
should be applied to the present case; otherwise, it would be reduced to "a mere academic exercise with the result
that the doctrine laid down would be no more than a dictum, and would deprive the holding in the case of any
force." 5
The other arguments advanced by petitioner are a mere rehash of the arguments in its previous pleadings, which
had already been passed upon adequately by the Court in the assailed decision.
IN LIGHT OF THE FOREGOING, the Motion for Reconsideration is DENIED WITH FINALITY for lack of merit.
SO ORDERED.

Eagle Realty Corporation, a company engaged in the real estate business, bought a parcel of land from a
certain Reyes in 1984 via a Deed of Sale. This Reyes acquired the land from a certain Medina who earlier
acquired the said land via surreptitiously entering a false record in the records of the Land Registration
Commission. Eventually, the true owners of the said land, the de Leons, discovered that another title was
fraudulently issued to Medina over the same parcel of land. De Leon was able to have the said title
annulled as well as the TCT issued to Eagle Realty by virtue of the Deed of Sale.
ISSUE: Whether or not Eagle Realty is an innocent purchaser.
HELD: No. Based on case law (Sunshine Finance vs IAC, Oct. 28, 1991 / 203 SCRA 210), a corporation
engaged in the buying and selling of real estate is expected to exercise a higher standard of care and
diligence in ascertaining the status and condition of the property subject of its business transaction.
Similar to investment and financing corporations, it cannot simply rely on an examination of a Torrens
certificate to determine what the subject property, looks like as its condition is not apparent in the
document.

Motion for Reconsideration (July 31, 2009)

Eagle Realty, not content with the SC decision file a Motion for Reconsideration. It averred that the
Sunshine Finance case is not applicable because the principle and jurisprudence laid down in that
decision was promulgated by the SC for the first time only in 1991. That prior to that, when Eagle bought
the land in 1984, such extra diligence was not required from corporations engaged in real estate business.
ISSUE: Whether or not to apply the Sunshine Finance case in the case at bar.

HELD: Yes. The case law is not in the nature of a statute that cannot be retroactively applied. Hence, the
decision rendered by the SC in 2008 is merely based on contemporaneous legislative intent that the
interpreted law carried into effect. The SC was following with consistency its construction. Further, the
ruling in the Sunshine Finance case should be applied to this latter case otherwise it would be reduced to
a mere academic exercise with the result that the doctrine laid down would be no more than a dictum,
and would deprive the holding in the case of any force.