Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. 159747 April 13, 2004

GREGORIO B. HONASAN II, petitioner,

vs.
THE PANEL OF INVESTIGATING PROSECUTORS OF THE DEPARTMENT OF JUSTICE
(LEO DACERA, SUSAN F. DACANAY, EDNA A. VALENZUELA AND SEBASTIAN F.
CAPONONG, JR.), CIDG-PNP- P/DIRECTOR EDUARDO MATILLANO, and HON.
OMBUDSMAN SIMEON V. MARCELO, respondents.

DECISION

AUSTRIA-MARTINEZ, J.:

On August 4, 2003, an affidavit-complaint was filed with the Department of Justice

(DOJ) by respondent CIDG-PNP/P Director Eduardo Matillano. It reads in part:

2. After a thorough investigation, I found that a crime of coup d'etat was indeed
committed by military personnel who occupied Oakwood on the 27th day of July
2003 and Senator Gregorio "Gringo"Honasan, II
3.

4. The said crime was committed as follows:

4.1 On June 4, 2003, at on or about 11 p.m., in a house located in San Juan, Metro
Manila, a meeting was held and presided by Senator Honasan. Attached as Annex
"B" is the affidavit of Perfecto Ragil and made an integral part of this complaint.

4.8 In the early morning of July 27, 2003, Capt. Gerardo Gambala, for and in behalf
of the military rebels occupying Oakwood, made a public statement aired on nation
television, stating their withdrawal of support to the chain of command of the AFP
and the Government of President Gloria Macapagal Arroyo and they are willing to
risk their lives in order to achieve the National Recovery Agenda of Sen. Honasan,
which they believe is the only program that would solve the ills of society. . . .
(Emphasis supplied).

The Sworn Statement of AFP Major Perfecto Ragil referred to by PNP/P Director
Matillano is quoted verbatim, to wit:

1. That I am a member of the Communication Electronics and Information Systems

Services, Armed Forces of the Philippines with the rank of Major;

2. That I met a certain Captain Gary Alejano of the Presidential Security Guard (PSG)
during our Very Important Person (VIP) Protection Course sometime in last week of
March 2003;

3. That sometime in May 2003, Captain Alejano gave me a copy of the pamphlet of
the National Recovery Program (NRP) and told me that: "Kailangan ng Bansa ng
taong kagaya mo na walang bahid ng corruption kaya basahin mo ito (referring to
NRP) pamphlet. I took the pamphlet but never had the time to read it;

4. That sometime in the afternoon of June 4, 2003, Captain Alejano invited me to

join him in a meeting where the NRP would be discussed and that there would be a
special guest;

5. That Capt. Alejano and I arrived at the meeting at past 9 o'clock in the evening of
June 4, 2003 in a house located somewhere in San Juan, Metro Manila;

6. That upon arrival we were given a document consisting of about 3-4 pages
containing discussion of issues and concerns within the framework of NRP and we
were likewise served with dinner;
7. That while we were still having dinner at about past 11 o'clock in the evening,
Sen. Gregorio "Gringo" Honasan arrived together with another fellow who was later
introduced as Capt. Turingan;

8. That after Sen. Honasan had taken his dinner, the meeting proper started
presided by Sen. Honasan;

9. That Sen. Honasan discussed the NRP, the graft and corruption in the
government including the military institution, the judiciary, the executive branch
and the like;

10. That the discussion concluded that we must use force, violence and armed
struggle to achieve the vision of NRP. At this point, I raised the argument that it is
my belief that reforms will be achieved through the democratic processes and not
thru force and violence and/or armed struggle. Sen. Honasan countered that "we
will never achieve reforms through the democratic processes because the people
who are in power will not give up their positions as they have their vested interests
to protect." After a few more exchanges of views, Sen. Honasan appeared irritated
and asked me directly three (3) times: "In ka ba o out?" I then asked whether all
those present numbering 30 people, more or less, are really committed, Sen.
Honasan replied: "Kung kaya nating pumatay sa ating mga kalaban, kaya din nating
pumatay sa mga kasamahang magtataksil." I decided not to pursue further
questions;

11. That in the course of the meeting, he presented the plan of action to achieve
the goals of NRP, i.e., overthrow of the government under the present leadership
thru armed revolution and after which, a junta will be constituted and that junta will
run the new government. He further said that some of us will resign from the
military service and occupy civilian positions in the new government. He also said
that there is urgency that we implement this plan and that we would be notified of
the next activities.

12. That after the discussion and his presentation, he explained the rites that we
were to undergo-some sort of "blood compact". He read a prayer that sounded more
like a pledge and we all recited it with raised arms and clenched fists. He then took
a knife and demonstrated how to make a cut on the left upper inner arm until it
bleeds. The cut was in form of the letter "I" in the old alphabet but was done in a
way that it actually looked like letter "H". Then, he pressed his right thumb against
the blood and pressed the thumb on the lower middle portion of the copy of the
Prayer. He then covered his thumb mark in blood with tape. He then pressed the cut
on his left arm against the NRP flag and left mark of letter "I" on it. Everybody else
followed;

13. That when my turn came, I slightly made a cut on my upper inner arm and
pricked a portion of it to let it bleed and I followed what Senator HONASAN did;

14. That I did not like to participate in the rites but I had the fear for my life with
what Senator HONASAN said that "kaya nating pumatay ng kasamahan";

15. That after the rites, the meeting was adjourned and we left the place;

16. That I avoided Captain Alejano after that meeting but I was extra cautious that
he would not notice it for fear of my life due to the threat made by Senator
HONASAN during the meeting on June 4, 2003 and the information relayed to me by
Captain Alejano that their group had already deeply established their network inside
the intelligence community;

17. That sometime in the first week of July 2003, Captain Alejano came to see me to
return the rifle that he borrowed and told me that when the group arrives at the
Malacaang Compound for "D-DAY", my task is to switch off the telephone PABX
that serves the Malacaang complex. I told him that I could not do it. No further
conversation ensued and he left;

18. That on Sunday, July 27, 2003, while watching the television, I saw flashed on
the screen Lieutenant Antonio Trillanes, Captain Gerardo Gambala, Captain Alejano
and some others who were present during the June 4th meeting that I attended,
having a press conference about their occupation of the Oakwood Hotel. I also saw
that the letter "I" on the arm bands and the banner is the same letter "I" in the
banner which was displayed and on which we pressed our wound to leave the
imprint of the letter "I";

19. That this Affidavit is being executed in order to attest the veracity of the
foregoing and in order to charge SENATOR GREGORIO "GRINGO" HONASAN, Capt.
FELIX TURINGAN, Capt. GARY ALEJANO, Lt. ANTONIO TRILLANES, Capt. GERARDO
GAMBALA and others for violation of Article 134-A of the Revised Penal Code for the
offense of "coup d'etat". (Emphasis supplied)

The affidavit-complaint is docketed as I.S. No. 2003-1120 and the Panel of

Investigating Prosecutors of the Department of Justice (DOJ Panel for brevity) sent a
subpoena to petitioner for preliminary investigation.

On August 27, 2003, petitioner, together with his counsel, appeared at the DOJ. He
filed a Motion for Clarification questioning DOJ's jurisdiction over the case, asserting
that since the imputed acts were committed in relation to his public office, it is the
Office of the Ombudsman, not the DOJ, that has the jurisdiction to conduct the
corresponding preliminary investigation; that should the charge be filed in court, it
is the Sandiganbayan, not the regular courts, that can legally take cognizance of the
case considering that he belongs to the group of public officials with Salary Grade
31; and praying that the proceedings be suspended until final resolution of his
motion.

Respondent Matillano submitted his comment/opposition thereto and petitioner filed

a reply.

On September 10, 2003, the DOJ Panel issued an Order, to wit:

On August 27, 2003, Senator Gregorio B. Honasan II filed through counsel a "Motion
to Clarify Jurisdiction". On September 1, 2003, complainant filed a
Comment/Opposition to the said motion.

The motion and comment/opposition are hereby duly noted and shall be passed
upon in the resolution of this case.

In the meantime, in view of the submission by complainant of additional

affidavits/evidence and to afford respondents ample opportunity to controvert the
same, respondents, thru counsel are hereby directed to file their respective counter-
affidavits and controverting evidence on or before September 23, 2003.1

Hence, Senator Gregorio B. Honasan II filed the herein petition for certiorari under
Rule 65 of the Rules of Court against the DOJ Panel and its members, CIDG-PNP-
P/Director Eduardo Matillano and Ombudsman Simeon V. Marcelo, attributing grave
abuse of discretion on the part of the DOJ Panel in issuing the aforequoted Order of
September 10, 2003 on the ground that the DOJ has no jurisdiction to conduct the
preliminary investigation.

Respondent Ombudsman, the Office of Solicitor General in representation of

respondents DOJ Panel, and Director Matillano submitted their respective
comments.

The Court heard the parties in oral arguments on the following issues:

1) Whether respondent Department of Justice Panel of Investigators has jurisdiction

to conduct preliminary investigation over the charge of coup d'etat against
petitioner;

2) Whether Ombudsman-DOJ Circular No. 95-001 violates the Constitution and

Republic Act No. 6770 or Ombudsman Act of 1989; and

3) Whether respondent DOJ Panel of Investigators committed grave abuse of

discretion in deferring the resolution of the petitioner's motion to clarify jurisdiction
considering the claim of the petitioner that the DOJ Panel has no jurisdiction to
conduct preliminary investigation.
After the oral arguments, the parties submitted their respective memoranda. The
arguments of petitioner are:

1. The Office of the Ombudsman has jurisdiction to conduct the preliminary

investigation over all public officials, including petitioner.

2. Respondent DOJ Panel is neither authorized nor deputized under OMB-DOJ Joint
Circular No. 95-001 to conduct the preliminary investigation involving Honasan.

3. Even if deputized, the respondent DOJ Panel is still without authority since OMB-
DOJ Joint Circular No. 95-001 is ultra vires for being violative of the Constitution,
beyond the powers granted to the Ombudsman by R.A. 6770 and inoperative due to
lack of publication, hence null and void.

4. Since petitioner is charged with coup de 'etat in relation to his office, it is the
Office of the Ombudsman which has the jurisdiction to conduct the preliminary
investigation.

5. The respondent DOJ Panel gravely erred in deferring the resolution of petitioner's
Motion to Clarify Jurisdiction since the issue involved therein is determinative of the
validity of the preliminary investigation.

6. Respondent DOJ Panel gravely erred when it resolved petitioner's Motion in the
guise of directing him to submit Counter-Affidavit and yet refused and/or failed to
perform its duties to resolve petitioner's Motion stating its legal and factual bases.

The arguments of respondent DOJ Panel are:

1. The DOJ has jurisdiction to conduct the preliminary investigation on petitioner

pursuant to Section 3, Chapter I, Title III, Book IV of the Revised Administrative Code
of 1987 in relation to P.D. No. 1275, as amended by P.D. No. 1513.

2. Petitioner is charged with a crime that is not directly nor intimately related to his
public office as a Senator. The factual allegations in the complaint and the
supporting affidavits are bereft of the requisite nexus between petitioner's office
and the acts complained of.

3. The challenge against the constitutionality of the OMB-DOJ Joint Circular, as a

ground to question the jurisdiction of the DOJ over the complaint below, is
misplaced. The jurisdiction of the DOJ is a statutory grant under the Revised
Administrative Code. It is not derived from any provision of the joint circular which
embodies the guidelines governing the authority of both the DOJ and the Office of
the Ombudsman to conduct preliminary investigation on offenses charged in
relation to public office.

4. Instead of filing his counter-affidavit, petitioner opted to file a motion to clarify

jurisdiction which, for all intents and purposes, is actually a motion to dismiss that is
a prohibited pleading under Section 3, Rule 112 of the Revised Rules of Criminal
Procedure. The DOJ Panel is not required to act or even recognize it since a
preliminary investigation is required solely for the purpose of determining whether
there is a sufficient ground to engender a well founded belief that a crime has been
committed and the respondent is probably guilty thereof and should be held for
trial. The DOJ panel did not outrightly reject the motion of petitioner but ruled to
pass upon the same in the determination of the probable cause; thus, it has not
violated any law or rule or any norm of discretion.

The arguments of respondent Ombudsman are:

1. The DOJ Panel has full authority and jurisdiction to conduct preliminary
investigation over the petitioner for the reason that the crime of coup d'etat under
Article No. 134-A of the Revised Penal Code (RPC) may fall under the jurisdiction of
the Sandiganbayan only if the same is committed "in relation to office" of petitioner,
pursuant to Section 4, P.D. No. 1606, as amended by R.A. No. 7975 and R.A. No.
8249.

2. Petitioner's premise that the DOJ Panel derives its authority to conduct
preliminary investigation over cases involving public officers solely from the OMB-
DOJ Joint Circular No. 95-001 is misplaced because the DOJ's concurrent authority
with the OMB to conduct preliminary investigation of cases involving public officials
has been recognized in Sanchez vs. Demetriou (227 SCRA 627 [1993]) and
incorporated in Section 4, Rule 112 of the Revised Rules of Criminal Procedure.

3. Petitioner's assertion that the Joint Circular is ultra vires and the DOJ cannot be
deputized by the Ombudsman en masse but must be given in reference to specific
cases has no factual or legal basis. There is no rule or law which requires the
Ombudsman to write out individualized authorities to deputize prosecutors on a per
case basis. The power of the Ombudsman to deputize DOJ prosecutors proceeds
from the Constitutional grant of power to request assistance from any government
agency necessary to discharge its functions, as well as from the statutory authority
to so deputize said DOJ prosecutors under Sec. 31 of RA 6770.

4. The Joint Circular which is an internal arrangement between the DOJ and the
Office of the Ombudsman need not be published since it neither contains a penal
provision nor does it prescribe a mandatory act or prohibit any under pain or
penalty. It does not regulate the conduct of persons or the public, in general.

The Court finds the petition without merit.

The authority of respondent DOJ Panel is based not on the assailed OMB-DOJ
Circular No. 95-001 but on the provisions of the 1987 Administrative Code under
Chapter I, Title III, Book IV, governing the DOJ, which provides:

Sec. 1. Declaration of policy - It is the declared policy of the State to provide the
government with a principal law agency which shall be both its legal counsel and
prosecution arm; administer the criminal justice system in accordance with the
accepted processes thereof consisting in the investigation of the crimes,
prosecution of offenders and administration of the correctional system;

Sec. 3. Powers and Functions - To accomplish its mandate, the Department shall
have the following powers and functions:

(2) Investigate the commission of crimes, prosecute offenders and administer the
probation and correction system; (Emphasis supplied)

and Section 1 of P.D. 1275, effective April 11, 1978, to wit:

SECTION 1. Creation of the National Prosecution Service; Supervision and Control of

the Secretary of Justice. There is hereby created and established a National
Prosecution Service under the supervision and control of the Secretary of Justice, to
be composed of the Prosecution Staff in the Office of the Secretary of Justice and
such number of Regional State Prosecution Offices, and Provincial and City Fiscal's
Offices as are hereinafter provided, which shall be primarily responsible for the
investigation and prosecution of all cases involving violations of penal laws.
(Emphasis supplied)

Petitioner claims that it is the Ombudsman, not the DOJ, that has the jurisdiction to
conduct the preliminary investigation under paragraph (1), Section 13, Article XI of
the 1987 Constitution, which confers upon the Office of the Ombudsman the power
to investigate on its own, or on complaint by any person, any act or omission of any
public official, employee, office or agency, when such act or omission appears to be
illegal, unjust, improper, or inefficient. Petitioner rationalizes that the 1987
Administrative Code and the Ombudsman Act of 1989 cannot prevail over the
Constitution, pursuant to Article 7 of the Civil Code, which provides:

Article 7. Laws are repealed only by subsequent ones, and their violation or non-
observance shall not be excused by disuse, or custom or practice to the contrary.

When the courts declare a law to be inconsistent with the Constitution, the former
shall be void and the latter shall govern.

Administrative or executive acts, orders and regulations shall be valid only when
they are not contrary to the laws or the Constitution.
and Mabanag vs. Lopez Vito.2

The Court is not convinced. Paragraph (1) of Section 13, Article XI of the
Constitution, viz:

SEC. 13. The Office of the Ombudsman shall have the following powers, functions,
and duties:

1. Investigate on its own, or on complaint by any person, any act or omission of any
public official, employee, office or agency, when such act or omission appears to be
illegal, unjust, improper, or inefficient.

does not exclude other government agencies tasked by law to investigate and
prosecute cases involving public officials. If it were the intention of the framers of
the 1987 Constitution, they would have expressly declared the exclusive
conferment of the power to the Ombudsman. Instead, paragraph (8) of the same
Section 13 of the Constitution provides:

(8) Promulgate its rules of procedure and exercise such other powers or perform
such functions or duties as may be provided by law.

Accordingly, Congress enacted R.A. 6770, otherwise known as "The Ombudsman Act
of 1989." Section 15 thereof provides:

Sec. 15. Powers, Functions and Duties. - The Office of the Ombudsman shall have
the following powers, functions and duties:

(1) Investigate and prosecute on its own or on complaint by any person, any act or
omission of any public officer or employee, office or agency, when such act or
omission appears to be illegal, unjust, improper or inefficient. It has primary
jurisdiction over cases cognizable by the Sandiganbayan and, in the exercise of this
primary jurisdiction, it may take over, at any stage, from any investigatory agency
of the government, the investigation of such cases.

. (Emphasis supplied)

Pursuant to the authority given to the Ombudsman by the Constitution and the
Ombudsman Act of 1989 to lay down its own rules and procedure, the Office of the
Ombudsman promulgated Administrative Order No. 8, dated November 8, 1990,
entitled, Clarifying and Modifying Certain Rules of Procedure of the Ombudsman, to
wit:

A complaint filed in or taken cognizance of by the Office of the Ombudsman

charging any public officer or employee including those in government-owned or
controlled corporations, with an act or omission alleged to be illegal, unjust,
improper or inefficient is an Ombudsman case. Such a complaint may be the subject
of criminal or administrative proceedings, or both.

For purposes of investigation and prosecution, Ombudsman cases involving criminal

offenses may be subdivided into two classes, to wit: (1) those cognizable by the
Sandiganbayan, and (2) those falling under the jurisdiction of the regular courts.
The difference between the two, aside from the category of the courts wherein they
are filed, is on the authority to investigate as distinguished from the authority to
prosecute, such cases.

The power to investigate or conduct a preliminary investigation on any Ombudsman

case may be exercised by an investigator or prosecutor of the Office of the
Ombudsman, or by any Provincial or City Prosecutor or their assistance, either in
their regular capacities or as deputized Ombudsman prosecutors.

The prosecution of cases cognizable by the Sandiganbayan shall be under the direct
exclusive control and supervision of the Office of the Ombudsman. In cases
cognizable by the regular Courts, the control and supervision by the Office of the
Ombudsman is only in Ombudsman cases in the sense defined above. The law
recognizes a concurrence of jurisdiction between the Office of the Ombudsman and
other investigative agencies of the government in the prosecution of cases
cognizable by regular courts. (Emphasis supplied)

It is noteworthy that as early as 1990, the Ombudsman had properly differentiated

the authority to investigate cases from the authority to prosecute cases. It is on this
note that the Court will first dwell on the nature or extent of the authority of the
Ombudsman to investigate cases. Whence, focus is directed to the second sentence
of paragraph (1), Section 15 of the Ombudsman Act which specifically provides that
the Ombudsman has primary jurisdiction over cases cognizable by the
Sandiganbayan, and, in the exercise of this primary jurisdiction, it may take over, at
any stage, from any investigating agency of the government, the investigation of
such cases.

That the power of the Ombudsman to investigate offenses involving public officers
or employees is not exclusive but is concurrent with other similarly authorized
agencies of the government such as the provincial, city and state prosecutors has
long been settled in several decisions of the Court.

In Cojuangco, Jr. vs. Presidential Commission on Good Government, decided in 1990,

the Court expressly declared:

A reading of the foregoing provision of the Constitution does not show that the
power of investigation including preliminary investigation vested on the
Ombudsman is exclusive.3

Interpreting the primary jurisdiction of the Ombudsman under Section 15 (1) of the
Ombudsman Act, the Court held in said case:

Under Section 15 (1) of Republic Act No. 6770 aforecited, the Ombudsman has
primary jurisdiction over cases cognizable by the Sandiganbayan so that it may take
over at any stage from any investigatory agency of the government, the
investigation of such cases. The authority of the Ombudsman to investigate
offenses involving public officers or employees is not exclusive but is concurrent
with other similarly authorized agencies of the government. Such investigatory
agencies referred to include the PCGG and the provincial and city prosecutors and
their assistants, the state prosecutors and the judges of the municipal trial courts
and municipal circuit trial court.

In other words the provision of the law has opened up the authority to conduct
preliminary investigation of offenses cognizable by the Sandiganbayan to all
investigatory agencies of the government duly authorized to conduct a preliminary
investigation under Section 2, Rule 112 of the 1985 Rules of Criminal Procedure with
the only qualification that the Ombudsman may take over at any stage of such
investigation in the exercise of his primary jurisdiction.4 (Emphasis supplied)

A little over a month later, the Court, in Deloso vs. Domingo,5 pronounced that the
Ombudsman, under the authority of Section 13 (1) of the 1987 Constitution, has
jurisdiction to investigate any crime committed by a public official, elucidating thus:

As protector of the people, the office of the Ombudsman has the power, function
and duty to "act promptly on complaints filed in any form or manner against public
officials" (Sec. 12) and to "investigate x x x any act or omission of any public official
x x x when such act or omission appears to be illegal, unjust, improper or
inefficient." (Sec. 13[1].) The Ombudsman is also empowered to "direct the officer
concerned," in this case the Special Prosecutor, "to take appropriate action against
a public official x x x and to recommend his prosecution" (Sec. 13[3]).

The clause "any [illegal] act or omission of any public official" is broad enough to
embrace any crime committed by a public official. The law does not qualify the
nature of the illegal act or omission of the public official or employee that the
Ombudsman may investigate. It does not require that the act or omission be related
to or be connected with or arise from, the performance of official duty. Since the law
does not distinguish, neither should we.

The reason for the creation of the Ombudsman in the 1987 Constitution and for the
grant to it of broad investigative authority, is to insulate said office from the long
tentacles of officialdom that are able to penetrate judges' and fiscals' offices, and
others involved in the prosecution of erring public officials, and through the exertion
of official pressure and influence, quash, delay, or dismiss investigations into
malfeasances and misfeasances committed by public officers. It was deemed
necessary, therefore, to create a special office to investigate all criminal complaints
against public officers regardless of whether or not the acts or omissions
complained of are related to or arise from the performance of the duties of their
office. The Ombudsman Act makes perfectly clear that the jurisdiction of the
Ombudsman encompasses "all kinds of malfeasance, misfeasance, and non-
feasance that have been committed by any officer or employee as mentioned in
Section 13 hereof, during his tenure of office" (Sec. 16, R.A. 6770).

.........

Indeed, the labors of the constitutional commission that created the Ombudsman as
a special body to investigate erring public officials would be wasted if its jurisdiction
were confined to the investigation of minor and less grave offenses arising from, or
related to, the duties of public office, but would exclude those grave and terrible
crimes that spring from abuses of official powers and prerogatives, for it is the
investigation of the latter where the need for an independent, fearless, and honest
investigative body, like the Ombudsman, is greatest.6

At first blush, there appears to be conflicting views in the rulings of the Court in the
Cojuangco, Jr. case and the Deloso case. However, the contrariety is more apparent
than real. In subsequent cases, the Court elucidated on the nature of the powers of
the Ombudsman to investigate.

In 1993, the Court held in Sanchez vs. Demetriou,7 that while it may be true that
the Ombudsman has jurisdiction to investigate and prosecute any illegal act or
omission of any public official, the authority of the Ombudsman to investigate is
merely a primary and not an exclusive authority, thus:

The Ombudsman is indeed empowered under Section 15, paragraph (1) of RA 6770
to investigate and prosecute any illegal act or omission of any public official.
However as we held only two years ago in the case of Aguinaldo vs. Domagas,8 this
authority "is not an exclusive authority but rather a shared or concurrent authority
in respect of the offense charged."

Petitioners finally assert that the information and amended information filed in this
case needed the approval of the Ombudsman. It is not disputed that the information
and amended information here did not have the approval of the Ombudsman.
However, we do not believe that such approval was necessary at all. In Deloso v.
Domingo, 191 SCRA 545 (1990), the Court held that the Ombudsman has authority
to investigate charges of illegal acts or omissions on the part of any public official,
i.e., any crime imputed to a public official. It must, however, be pointed out that the
authority of the Ombudsman to investigate "any [illegal] act or omission of any
public official" (191 SCRA 550) is not an exclusive authority but rather a shared or
concurrent authority in respect of the offense charged, i.e., the crime of sedition.
Thus, the non-involvement of the office of the Ombudsman in the present case does
not have any adverse legal consequence upon the authority of the panel of
prosecutors to file and prosecute the information or amended information.

In fact, other investigatory agencies of the government such as the Department of

Justice in connection with the charge of sedition, and the Presidential Commission
on Good Government, in ill gotten wealth cases, may conduct the investigation.9
(Emphasis supplied)

In Natividad vs. Felix,10 a 1994 case, where the petitioner municipal mayor
contended that it is the Ombudsman and not the provincial fiscal who has the
authority to conduct a preliminary investigation over his case for alleged Murder,
the Court held:

The Deloso case has already been re-examined in two cases, namely Aguinaldo vs.
Domagas and Sanchez vs. Demetriou. However, by way of amplification, we feel the
need for tracing the history of the legislation relative to the jurisdiction of
Sandiganbayan since the Ombudsman's primary jurisdiction is dependent on the
cases cognizable by the former.
In the process, we shall observe how the policy of the law, with reference to the
subject matter, has been in a state of flux.

These laws, in chronological order, are the following: (a) Pres. Decree No. 1486, --
the first law on the Sandiganbayan; (b) Pres. Decree No. 1606 which expressly
repealed Pres. Decree No. 1486; (c) Section 20 of Batas Pambansa Blg. 129; (d)
Pres. Decree No. 1860; and (e) Pres. Decree No. 1861.

The latest law on the Sandiganbayan, Sec. 1 of Pres. Decree No. 1861 reads as
follows:

"SECTION 1. Section 4 of Presidential Decree No. 1606 is hereby amended to read

as follows:

'SEC. 4. Jurisdiction. The Sandiganbayan shall exercise:

'(a) Exclusive original jurisdiction in all cases involving:

...

(2) Other offenses or felonies committed by public officers and employees in

relation to their office, including those employed in government-owned or controlled
corporation, whether simple or complexed with other crimes, where the penalty
prescribed by law is higher that prision correccional or imprisonment for six (6)
years, or a fine of P6,000: PROVIDED, HOWEVER, that offenses or felonies
mentioned in this paragraph where the penalty prescribed by law does not exceed
prision correccional or imprisonment for six (6) years or a fine of P6,000 shall be
tried by the proper Regional Trial Court, Metropolitan Trial Court, Municipal Trial
Court and Municipal Circuit Trial Court."

A perusal of the aforecited law shows that two requirements must concur under Sec.
4 (a) (2) for an offense to fall under the Sandiganbayan's jurisdiction, namely: the
offense committed by the public officer must be in relation to his office and the
penalty prescribed be higher then prision correccional or imprisonment for six (6)
years, or a fine of P6,000.00.11

Applying the law to the case at bench, we find that although the second
requirement has been met, the first requirement is wanting. A review of these
Presidential Decrees, except Batas Pambansa Blg. 129, would reveal that the crime
committed by public officers or employees must be "in relation to their office" if it is
to fall within the jurisdiction of the Sandiganbayan. This phrase which is traceable to
Pres. Decree No. 1468, has been retained by Pres. Decree No. 1861 as a
requirement before the Ombudsman can acquire primary jurisdiction on its power to
investigate.

It cannot be denied that Pres. Decree No. 1861 is in pari materia to Article XI,
Sections 12 and 13 of the 1987 Constitution and the Ombudsman Act of 1989
because, as earlier mentioned, the Ombudsman's power to investigate is dependent
on the cases cognizable by the Sandiganbayan. Statutes are in pari materia when
they relate to the same person or thing or to the same class of persons or things, or
object, or cover the same specific or particular subject matter.

It is axiomatic in statutory construction that a statute must be interpreted, not only

to be consistent with itself, but also to harmonize with other laws on the same
subject matter, as to form a complete, coherent and intelligible system. The rule is
expressed in the maxim, "interpretare et concordare legibus est optimus
interpretandi," or every statute must be so construed and harmonized with other
statutes as to form a uniform system of jurisprudence. Thus, in the application and
interpretation of Article XI, Sections 12 and 13 of the 1987 Constitution and the
Ombudsman Act of 1989, Pres. Decree No. 1861 must be taken into consideration. It
must be assumed that when the 1987 Constitution was written, its framers had in
mind previous statutes relating to the same subject matter. In the absence of any
express repeal or amendment, the 1987 Constitution and the Ombudsman Act of
1989 are deemed in accord with existing statute, specifically, Pres. Decree No.
1861.12 (Emphasis supplied)
R.A. No. 8249 which amended Section 4, paragraph (b) of the Sandiganbayan Law
(P.D. 1861) likewise provides that for other offenses, aside from those enumerated
under paragraphs (a) and (c), to fall under the exclusive jurisdiction of the
Sandiganbayan, they must have been committed by public officers or employees in
relation to their office.

In summation, the Constitution, Section 15 of the Ombudsman Act of 1989 and

Section 4 of the Sandiganbayan Law, as amended, do not give to the Ombudsman
exclusive jurisdiction to investigate offenses committed by public officers or
employees. The authority of the Ombudsman to investigate offenses involving
public officers or employees is concurrent with other government investigating
agencies such as provincial, city and state prosecutors. However, the Ombudsman,
in the exercise of its primary jurisdiction over cases cognizable by the
Sandiganbayan, may take over, at any stage, from any investigating agency of the
government, the investigation of such cases.

In other words, respondent DOJ Panel is not precluded from conducting any
investigation of cases against public officers involving violations of penal laws but if
the cases fall under the exclusive jurisdiction of the Sandiganbayan, then
respondent Ombudsman may, in the exercise of its primary jurisdiction take over at
any stage.

Thus, with the jurisprudential declarations that the Ombudsman and the DOJ have
concurrent jurisdiction to conduct preliminary investigation, the respective heads of
said offices came up with OMB-DOJ Joint Circular No. 95-001 for the proper
guidelines of their respective prosecutors in the conduct of their investigations, to
wit:

OMB-DOJ JOINT CIRCULAR NO. 95-001

Series of 1995

TO: ALL GRAFT INVESTIGATION/SPECIAL PROSECUTION OFFICERS OF THE OFFICE OF

THE OMBUDSMAN

ALL REGIONAL STATE PROSECUTORS AND THEIR ASSISTANTS, PROVINCIAL/CITY

PROSECUTORS AND THEIR ASSISTANTS, STATE PROSECUTORS AND PROSECUTING
ATTORNEYS OF THE DEPARTMENT OF JUSTICE.

SUBJECT: HANDLING COMPLAINTS FILED AGAINST PUBLIC OFFICERS AND

EMPLOYEES, THE CONDUCT OF PRELIMINARY INVESTIGATION, PREPARATION OF
RESOLUTIONS AND INFORMATIONS AND PROSECUTION OF CASES BY PROVINCIAL
AND CITY PROSECUTORS AND THEIR ASSISTANTS.

x-------------------------------------------------------------------------------------------------------x

In a recent dialogue between the OFFICE OF THE OMBUDSMAN and the

DEPARTMENT OF JUSTICE, discussion centered around the latest pronouncement of
the supreme court on the extent to which the ombudsman may call upon the
government prosecutors for assistance in the investigation and prosecution of
criminal cases cognizable by his office and the conditions under which he may do
so. Also discussed was Republic Act No. 7975 otherwise known as "an act to
strengthen the functional and structural organization of the sandiganbayan,
amending for the purpose presidential decree no. 1606, as amended" and its
implications on the jurisdiction of the office of the Ombudsman on criminal offenses
committed by public officers and employees.

Concerns were expressed on unnecessary delays that could be caused by

discussions on jurisdiction between the OFFICE OF THE OMBUDSMAN and the
department of justice, and by procedural conflicts in the filing of complaints against
public officers and employees, the conduct of preliminary investigations, the
preparation of resolutions and informations, and the prosecution of cases by
provincial and city prosecutors and their assistants as deputized prosecutors of the
ombudsman.

Recognizing the concerns, the office of the ombudsman and the department of
justice, in a series of consultations, have agreed on the following guidelines to be
observed in the investigation and prosecution of cases against public officers and
employees:

1. Preliminary investigation and prosecution of offenses committed by public officers

and employees in relation to office whether cognizable by the sandiganbayan or the
regular courts, and whether filed with the office of the ombudsman or with the office
of the provincial/city prosecutor shall be under the control and supervision of the
office of the ombudsman.

2. Unless the Ombudsman under its Constitutional mandate finds reason to believe
otherwise, offenses not in relation to office and cognizable by the regular courts
shall be investigated and prosecuted by the office of the provincial/city prosecutor,
which shall rule thereon with finality.

3. Preparation of criminal information shall be the responsibility of the investigating

officer who conducted the preliminary investigation. Resolutions recommending
prosecution together with the duly accomplished criminal informations shall be
forwarded to the appropriate approving authority.

4. Considering that the office of the ombudsman has jurisdiction over public officers
and employees and for effective monitoring of all investigations and prosecutions of
cases involving public officers and employees, the office of the provincial/city
prosecutor shall submit to the office of the ombudsman a monthly list of complaints
filed with their respective offices against public officers and employees.

Manila, Philippines, October 5, 1995.

(signed)

TEOFISTO T. GUINGONA, JR.

Secretary
Department of Justice

(signed)

ANIANO A. DESIERTO
Ombudsman
Office of the Ombudsman

A close examination of the circular supports the view of the respondent

Ombudsman that it is just an internal agreement between the Ombudsman and the
DOJ.

Sections 2 and 4, Rule 112 of the Revised Rules on Criminal Procedure on

Preliminary Investigation, effective December 1, 2000, to wit:

SEC. 2. Officers authorized to conduct preliminary investigations-

The following may conduct preliminary investigations:

(a) Provincial or City Prosecutors and their assistants;

(b) Judges of the Municipal Trial Courts and Municipal Circuit Trial Courts;

(c) National and Regional State Prosecutors; and

(d) Other officers as may be authorized by law.

Their authority to conduct preliminary investigation shall include all crimes

cognizable by the proper court in their respective territorial jurisdictions.

SEC. 4. Resolution of investigating prosecutor and its review. - If the investigating

prosecutor finds cause to hold the respondent for trial, he shall prepare the
resolution and information, He shall certify under oath in the information that he, or
as shown by the record, an authorized officer, has personally examined the
complainant and his witnesses; that there is reasonable ground to believe that a
crime has been committed and that the accused is probably guilty thereof; that the
accused was informed of the complaint and of the evidence submitted against him;
and that he was given an opportunity to submit controverting evidence. Otherwise,
he shall recommend the dismissal of the complaint.

Within five (5) days from his resolution, he shall forward the record of the case to
the provincial or city prosecutor or chief state prosecutor, or to the Ombudsman or
his deputy in cases of offenses cognizable by the Sandiganbayan in the exercise of
its original jurisdiction. They shall act on the resolution within ten (10) days from
their receipt thereof and shall immediately inform the parties of such action.

No complaint or information may be filed or dismissed by an investigating

prosecutor without the prior written authority or approval of the provincial or city
prosecutor or chief state prosecutor or the Ombudsman or his deputy.

Where the investigating prosecutor recommends the dismissal of the complaint but
his recommendation is disapproved by the provincial or city prosecutor or chief
state prosecutor or the Ombudsman or his deputy on the ground that a probable
cause exists, the latter may, by himself file the information against the respondent,
or direct another assistant prosecutor or state prosecutor to do so without
conducting another preliminary investigation.

If upon petition by a proper party under such rules as the Department of Justice may
prescribe or motu proprio, the Secretary of Justice reverses or modifies the
resolution of the provincial or city prosecutor or chief state prosecutor, he shall
direct the prosecutor concerned either to file the corresponding information without
conducting another preliminary investigation, or to dismiss or move for dismissal of
the complaint or information with notice to the parties. The same Rule shall apply in
preliminary investigations conducted by the officers of the Office of the
Ombudsman. (Emphasis supplied)

confirm the authority of the DOJ prosecutors to conduct preliminary investigation of

criminal complaints filed with them for offenses cognizable by the proper court
within their respective territorial jurisdictions, including those offenses which come
within the original jurisdiction of the Sandiganbayan; but with the qualification that
in offenses falling within the original jurisdiction of the Sandiganbayan, the
prosecutor shall, after their investigation, transmit the records and their resolutions
to the Ombudsman or his deputy for appropriate action. Also, the prosecutor cannot
dismiss the complaint without the prior written authority of the Ombudsman or his
deputy, nor can the prosecutor file an Information with the Sandiganbayan without
being deputized by, and without prior written authority of the Ombudsman or his
deputy.

Next, petitioner contends that under OMB-Joint Circular No. 95-001, there is no
showing that the Office of the Ombudsman has deputized the prosecutors of the
DOJ to conduct the preliminary investigation of the charge filed against him.

We find no merit in this argument. As we have lengthily discussed, the Constitution,

the Ombudsman Act of 1989, Administrative Order No. 8 of the Office of the
Ombudsman, the prevailing jurisprudence and under the Revised Rules on Criminal
Procedure, all recognize and uphold the concurrent jurisdiction of the Ombudsman
and the DOJ to conduct preliminary investigation on charges filed against public
officers and employees.

To reiterate for emphasis, the power to investigate or conduct preliminary

investigation on charges against any public officers or employees may be exercised
by an investigator or by any provincial or city prosecutor or their assistants, either
in their regular capacities or as deputized Ombudsman prosecutors. The fact that all
prosecutors are in effect deputized Ombudsman prosecutors under the OMB-DOJ
Circular is a mere superfluity. The DOJ Panel need not be authorized nor deputized
by the Ombudsman to conduct the preliminary investigation for complaints filed
with it because the DOJ's authority to act as the principal law agency of the
government and investigate the commission of crimes under the Revised Penal
Code is derived from the Revised Administrative Code which had been held in the
Natividad case13 as not being contrary to the Constitution. Thus, there is not even a
need to delegate the conduct of the preliminary investigation to an agency which
has the jurisdiction to do so in the first place. However, the Ombudsman may assert
its primary jurisdiction at any stage of the investigation.
Petitioner's contention that OMB-DOJ Joint Circular No. 95-001 is ineffective on the
ground that it was not published is not plausible. We agree with and adopt the
Ombudsman's dissertation on the matter, to wit:

Petitioner appears to be of the belief, although NOT founded on a proper reading

and application of jurisprudence, that OMB-DOJ Joint Circular No. 95-001, an internal
arrangement between the DOJ and the Office of the Ombudsman, has to be
published.

As early as 1954, the Honorable Court has already laid down the rule in the case of
People vs. Que Po Lay, 94 Phil. 640 (1954) that only circulars and regulations which
prescribe a penalty for its violation should be published before becoming effective,
this, on the general principle and theory that before the public is bound by its
contents, especially its penal provision, a law, regulation or circular must first be
published and the people officially and specifically informed of said contents and its
penalties: said precedent, to date, has not yet been modified or reversed. OMB-DOJ
Joint Circular No. 95-001 DOES NOT contain any penal provision or prescribe a
mandatory act or prohibit any, under pain or penalty.

What is more, in the case of Tanada v. Tuvera, 146 SCRA 453 (1986), the Honorable
Court ruled that:

Interpretative regulations and those merely internal in nature, that is, regulating
only the personnel of the administrative agency and not the public, need not be
published. Neither is publication required of the so-called letters of instructions
issued by administrative superiors concerning the rules or guidelines to be followed
by their subordinates in the performance of their duties. (at page 454. emphasis
supplied)

OMB-DOJ Joint Circular No. 95-001 is merely an internal circular between the DOJ
and the Office of the Ombudsman, outlining authority and responsibilities among
prosecutors of the DOJ and of the Office of the Ombudsman in the conduct of
preliminary investigation. OMB-DOJ Joint Circular No. 95-001 DOES NOT regulate the
conduct of persons or the public, in general.

Accordingly, there is no merit to petitioner's submission that OMB-DOJ Joint Circular

No. 95-001 has to be published.14

Petitioner insists that the Ombudsman has jurisdiction to conduct the preliminary
investigation because petitioner is a public officer with salary Grade 31 so that the
case against him falls exclusively within the jurisdiction of the Sandiganbayan.
Considering the Court's finding that the DOJ has concurrent jurisdiction to
investigate charges against public officers, the fact that petitioner holds a Salary
Grade 31 position does not by itself remove from the DOJ Panel the authority to
investigate the charge of coup d'etat against him.

The question whether or not the offense allegedly committed by petitioner is one of
those enumerated in the Sandiganbayan Law that fall within the exclusive
jurisdiction of the Sandiganbayan will not be resolved in the present petition so as
not to pre-empt the result of the investigation being conducted by the DOJ Panel as
to the questions whether or not probable cause exists to warrant the filing of the
information against the petitioner; and to which court should the information be
filed considering the presence of other respondents in the subject complaint.

WHEREFORE, the petition for certiorari is DISMISSED for lack of merit.

SO ORDERED.

Davide, Jr., C.J., Panganiban, Carpio, Corona, Carpio-Morales, Callejo, Sr., Azcuna,
and Tinga, JJ., concur.
Puno, J., joins J. Ynares-Santiago.
Vitug, J., see separate dissenting opinion.
Quisumbing, J., joins the dissent.
Ynares-Santiago, J., see separate dissenting opinion.
Sandoval-Gutierrez, J., see dissenting opinion.
SEPARATE OPINION

VITUG, J.:

Preliminary investigation is an initial step in the indictment of an accused; it is a

substantive right, not merely a formal or a technical requirement,1 which an
accused can avail himself of in full measure. Thus, an accused is entitled to rightly
assail the conduct of an investigation that does not accord with the law. He may
also question the jurisdiction or the authority of the person or agency conducting
that investigation and, if bereft of such jurisdiction or authority, to demand that it be
undertaken strictly in conformity with the legal prescription.2

The Ombudsman is empowered3 to, among other things, investigate and prosecute
on its own or on complaint by any person, any act or omission of any public officer
or employee, office or agency, when such act or omission appears to be illegal,
unjust, improper or inefficient. It has primary jurisdiction over cases cognizable by
the Sandiganbayan and, in the exercise of this primary jurisdiction, it may, at any
stage, take over from any agency of Government the investigation of such cases.
This statutory provision, by and large, is a restatement of the constitutional grant to
the Ombudsman of the power to investigate and prosecute "any act or omission of
any public officer or employee, office or agency, when such act or omission appears
to be illegal x x x."4

The Panel of Investigating Prosecutors of the Department of Justice, in taking

cognizance of the preliminary investigation on charges of coup d'etat against
petitioner Gregorio Honasan, relies on OMB-DOJ Circular No. 95-001. That joint
circular must be understood as being merely a working arrangement between the
Office of the Ombudsman (OMB) and the Department of Justice (DOJ) that must not
be meant to be such a blanket delegation to the DOJ as to generally allow it to
conduct preliminary investigation over any case cognizable by the OMB.

While Section 31 of Republic Act No. 6770 states that the Ombudsman may
"designate or deputize any fiscal, state prosecutor or lawyer in the government
service to act as special investigator or prosecutor to assist in the investigation and
prosecution of certain cases," the provision cannot be assumed, however, to be an
undefined and broad entrustment of authority. If it were otherwise, it would be
unable to either withstand the weight of burden to be within constitutional
parameters or the proscription against undue delegation of powers. The deputized
fiscal, state prosecutor or government lawyer must in each instance be named; the
case to which the deputized official is assigned must be specified; and the
investigation must be conducted under the supervision and control of the
Ombudsman. The Ombudsman remains to have the basic responsibility, direct or
incidental, in the investigation and prosecution of such cases.

The Sandiganbayan law5 grants to the Sandiganbayan exclusive original jurisdiction

over offenses or felonies, whether simple or complexed with other crimes,
committed by the public officials, including members of Congress, in relation to their
office. The crime of coup d'etat, with which petitioner, a member of the Senate, has
been charged, is said to be closely linked to his "National Recovery Program," a
publication which encapsules the bills and resolutions authored or sponsored by him
on the senate floor. I see the charge as being then related to and bearing on his
official function.

On the above score, I vote to grant the petition.

Republic of the Philippines

SUPREME COURT
Manila

FIRST DIVISION

G.R. NO. 146779 January 23, 2006

RENATO S. GATBONTON, Petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION, MAPUA INSTITUTE OF TECHNOLOGY and
JOSE CALDERON, Respondents.

DECISION

AUSTRIA-MARTINEZ, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of
Court which seeks to set aside the Decision1 dated November 10, 2000 of the Court
of Appeals (CA) in CA-G.R. SP No. 57470, affirming the decision of the National
Labor Relations Commission (NLRC); and the CA Resolution dated January 16, 2001,
denying the motion for reconsideration.2

Petitioner Renato S. Gatbonton is an associate professor of respondent Mapua

Institute of Technology (MIT), Faculty of Civil Engineering. Some time in November
1998, a civil engineering student of respondent MIT filed a letter-complaint against
petitioner for unfair/unjust grading system, sexual harassment and conduct
unbecoming of an academician. Pending investigation of the complaint, respondent
MIT, through its Committee on Decorum and Investigation placed petitioner under a
30-day preventive suspension effective January 11, 1999. The committee believed
that petitioners continued stay during the investigation affects his performance as
a faculty member, as well as the students learning; and that the suspension will
allow petitioner to "prepare himself for the investigation and will prevent his
influences to other members of the community."3

Thus, petitioner filed with the NLRC a complaint for illegal suspension, damages and
attorneys fees,4 docketed as NLRC-NCR Case No. 01-00388-99.

Petitioner questioned the validity of the administrative proceedings with the

Regional Trial Court of Manila in a petition for certiorari but the case was terminated
on May 21, 1999 when the parties entered into a compromise agreement wherein
respondent MIT agreed to publish in the school organ the rules and regulations
implementing Republic Act No. 7877 (R.A. No. 7877) or the Anti-Sexual Harassment
Act; disregard the previous administrative proceedings and conduct anew an
investigation on the charges against petitioner. Petitioner agreed to recognize the
validity of the published rules

and regulations, as well as the authority of respondent to investigate, hear and

decide the administrative case against him.5

On June 18, 1999, the Labor Arbiter rendered a decision, the dispositive portion of
which reads:

Wherefore, premises considered, the thirty day preventive suspension of

complainant is hereby declared to be illegal. Accordingly, respondents are directed
to pay his wages during the period of his preventive suspension.

The rest of complainants claims are dismissed.

SO ORDERED.6

Both respondents and petitioner filed their appeal from the Labor Arbiters Decision,
with petitioner questioning the dismissal of his claim for damages. In a Decision
dated September 30, 1999, the NLRC granted respondents appeal and set aside the
Labor Arbiters decision. His motion for reconsideration having been denied by the
NLRC on December 13, 1999, petitioner filed a special civil action for certiorari with
the CA.

On November 10, 2000, the CA promulgated the assailed decision affirming the
NLRC decision, the dispositive portion of which reads:

WHEREFORE, foregoing premises considered, the petition is hereby DENIED DUE

COURSE and ORDERED DISMISSED, and the challenged decision and order of public
respondent NLRC AFFIRMED.

SO ORDERED.7
Petitioner filed a motion for reconsideration which the CA denied in its Resolution
dated January 16, 2001.

Hence, the present petition based on the following grounds:

THE COURT OF APPEALS GRAVELY ERRED IN FINDING THAT THE NLRC WAS NOT
GUILTY OF GRAVE ABUSE OF DISCRETION IN RENDERING BOTH THE APPEAL
DECISION AND THE NLRC RESOLUTION.

THE COURT OF APPEALS GRAVELY ERRED IN AFFIRMING THE NLRCS DISMISSAL OF

PETITIONERS CLAIM FOR DAMAGES.8

Petitioner finds fault in the CAs decision, arguing that his preventive suspension
does not find any justification in the Mapua Rules and Regulations considering that
at the time of his preventive suspension on January 11, 1999, the rules have not
been promulgated yet as it was published only on February 23, 1999. Petitioner also
contests the lack of award of damages in his favor.9

The petition is partly meritorious.

Preventive suspension is a disciplinary measure for the protection of the companys

property pending investigation of any alleged malfeasance or misfeasance
committed by the employee. The employer may place the worker concerned under
preventive suspension if his continued employment poses a serious and imminent
threat to the life or property of the employer or of his co-workers.10 However, when
it is determined that there is no sufficient basis to justify an employees preventive
suspension, the latter is entitled to the payment of salaries during the time of
preventive suspension.11

R.A. No. 7877 imposed the duty on educational or training institutions to

"promulgate rules and regulations in consultation with and jointly approved by the
employees or students or trainees, through their duly designated representatives,
prescribing the procedures for the investigation of sexual harassment cases and the
administrative sanctions therefor."12 Petitioners preventive suspension was based
on respondent MITs Rules and Regulations for the Implemention of the Anti-Sexual
Harassment Act of 1995, or R.A. No. 7877. Rule II, Section 1 of the MIT Rules and
Regulations provides:

Section 1. Preventive Suspension of Accused in Sexual Harassment Cases. Any

member of the educational community may be placed immediately under
preventive suspension during the pendency of the hearing of the charges of grave
sexual harassment against him if the evidence of his guilt is strong and the school
head is morally convinced that the continued stay of the accused during the period
of investigation constitutes a distraction to the normal operations of the institution
or poses a risk or danger to the life or property of the other members of the
educational community.

It must be noted however, that respondent published said rules and regulations only
on February 23, 1999. In Taada vs. Tuvera,13 it was ruled 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 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.

Interpretative regulations and those merely internal in nature, that is, regulating
only the personnel of the administrative agency and not the public, need not be
published. Neither is publication required of the so-called letters of instructions
issued by administrative superiors concerning the rules or guidelines to be followed
by their subordinates in the performance of their duties.

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. (Emphasis supplied)

The Mapua Rules is one of those issuances that should be published for its
effectivity, since its purpose is to enforce and implement R.A. No. 7877, which is a
law of general application.14 In fact, the Mapua Rules itself explicitly required
publication of the rules for its effectivity, as provided in Section 3, Rule IV
(Administrative Provisions), which states that "[T]hese Rules and Regulations to
implement the Anti-Sexual Harassment Act of 1995 shall take effect fifteen (15)
days after publication by the Committee." Thus, at the time of the imposition of
petitioners preventive suspension on January 11, 1999, the Mapua Rules were not
yet legally effective, and therefore the suspension had no legal basis.

Moreover, even assuming that the Mapua Rules are applicable, the Court finds that
there is no sufficient basis to justify his preventive suspension. Under the Mapua
Rules, an accused may be placed under preventive suspension during pendency of
the hearing under any of the following circumstances:

(a) if the evidence of his guilt is strong and the school head is morally convinced
that the continued stay of the accused during the period of investigation constitutes
a distraction to the normal operations of the institution; or

(b) the accused poses a risk or danger to the life or property of the other members
of the educational community.

In petitioners case, there is no indication that petitioners preventive suspension

may be based on the foregoing circumstances. Committee Resolution No. 1 (Re:
Preventive Suspension of Engr. Renato Gatbonton) passed by the Committee on
Decorum and Investigation states the reasons for petitioners preventive
suspension, to wit:

Whereas, the committee believe[s] that the continued stay of the respondent during
the period of investigation,

1. Affects the respondents performance as a faculty member and laboratory head

considering the psychological effects depression and/or emotional stress during
investigation;lavvphil.ne+

2. Affects the student[s] learning and other members of the Mapua Institute of
Technology community.

Whereas, the committee believe[s] that this preventive suspension will allow the
respondent to prepare himself for the investigation and will prevent his influences to
other members of the community.15

Said resolution does not show that evidence of petitioners guilt is strong and that
the school head is morally convinced that petitioners continued stay during the
period of investigation constitutes a distraction to the normal operations of the
institution; or that petitioner poses a risk or danger to the life or property of the
other members of the educational community.

Even under the Labor Code, petitioners preventive suspension finds no valid
justification. As provided in Section 8, Rule XXIII, Book V of the Omnibus Rules
Implementing the Labor Code:

Sec. 8. Preventive Suspension. The employer may place the worker concerned
under preventive suspension if his continued employment poses a serious threat to
the life or property of the employer or of his co-workers.

As previously stated, there is nothing on record which shows that respondent MIT
imposed the preventive suspension on petitioner as his continued employment
poses a serious threat to the life or property of the employer or of his co-workers;
therefore, his preventive suspension is not justified.16 Consequently, the payment
of wages during his 30-day preventive suspension, i.e., from January 11, 1999 to
February 10, 1999, is in order.

With regard to petitioners claim for damages, the Court finds the same to be
without basis. While petitioners preventive suspension may have been unjustified,
this does not automatically mean that he is entitled to moral or other damages. In
Cocoland Development Corp. vs. NLRC,17 the Court ruled:lavvphil.ne+

In Primero vs. Intermediate Appellate Court, this Court held that " an award (of
moral damages) cannot be justified solely upon the premise (otherwise sufficient for
redress under the Labor Code) that the employer fired his employee without just
cause or due process. Additional facts must be pleaded and proven to warrant the
grant of moral damages under the Civil Code, these being, to repeat, that the act of
dismissal was attended by bad faith or fraud, or was oppressive to labor, or done in
a manner contrary to morals, good customs, or public policy; and of course, that
social humiliation, wounded feelings, grave anxiety, etc., resulted therefrom." This
was reiterated in Garcia vs. NLRC, where the Court added that exemplary damages
may be awarded only if the dismissal was shown to have been effected in a wanton,
oppressive or malevolent manner.

This the private respondent failed to do. Because no evidence was adduced to show
that petitioner company acted in bad faith or in a wanton or fraudulent manner in
dismissing the private respondent, the labor arbiter did not award any moral and
exemplary damages in his decision. Respondent NLRC therefore had no factual or
legal basis to award such damages in the exercise of its appellate jurisdiction.

The records of this case are bereft of any evidence showing that respondent MIT
acted in bad faith or in a wanton or fraudulent manner in preventively suspending
petitioner, thus, the Labor Arbiter was correct in not awarding any damages in favor
of petitioner.

WHEREFORE, the petition is PARTIALLY GRANTED. The Decision dated November 10,
2000 and Resolution dated January 16, 2001 of the Court of Appeals in CA-G.R. SP
No. 57470 as well as the NLRC Decision dated September 30, 1999 together with its
Resolution dated December 13, 1999, are hereby SET ASIDE and the Labor Arbiters
Decision dated June 18, 1999 is REINSTATED.

SO ORDERED.

THIRD DIVISION

FELIPE G. PACQUING, A.M. No. RTJ-07-2042

Complainant,
Present:

YNARES-SANTIAGO, C.,
- versus - Chairperson,
AUSTRIA-MARTINEZ,
CALLEJO, Sr.,
CHICO-NAZARIO, and
JUDGE BENEDICTO G. GOBARDE, NACHURA, JJ.
Regional Trial Court, Branch 53,
Lapu Lapu City, Cebu, Promulgated:
Respondent.

April 19, 2007

x --------------------------------------------------------------------------------------- x
RESOLUTION
NACHURA, J.:

In a Letter Complaint dated 4 August 2003,[1] Atty. Felipe G. Pacquing charged

respondent Benedicto G. Cobarde, RTC, Branch 53, Lapu-Lapu City, Cebu, with
undue delay in the disposition of Civil Case No. 2928-L entitled Federico Nacua, et
al., vs. Mactan Cebu International Airport Authority (MCIAA).

As counsel for the plaintiff in that case, Atty. Pacquing alleged that Civil Case No.
2928-L had been pending with Judge Cobarde's court since 27 June 2001. He said
that, on the said date, the defendant's formal offer of documentary evidence and
the plaintiff's comment thereto were already submitted to the court. On 10 October
2002, Atty. Pacquing filed a Motion to Decide the Case. However, the court took no
action.

Earlier, in a letter dated 4 February 2003, Atty. Pacquing sought the assistance of
the Office of the Court Administrator (OCA) for the early resolution of the civil case.
On 18 February 2003[2] and 30 May 2003,[3] the OCA, through Deputy Court
Administrator Zenaida N. Elepao, directed Judge Cobarde to comment. The
directives notwithstanding, Judge Cobarde failed to comply.

In the 1st Indorsement dated 21 August 2003,[4] the OCA, through Court
Administrator (now Associate Justice) Presbitero J. Velasco, Jr., again referred the
complaint to Judge Cobarde for comment. It likewise ordered him to show cause
within ten (10) days from notice why he should not be suspended, disbarred, or
otherwise disciplinarily sanctioned as a member of the Bar. Still, no comment was
filed. Hence, the OCA sent him a 1st Tracer dated 22 October 2003[5] enjoining him
to comply with the earlier directive within five (5) days from notice, otherwise, the
matter will be submitted to the Court. The action proved futile.

On 19 March 2004,[6] the OCA submitted the matter to this Court with the
recommendation that Judge Cobarde be directed to file his comment on the
complaint within a non-extendible period of ten (10) days from notice and to show
cause why he should not be administratively dealt with for his intransigence. The
Court adopted the recommendation of the OCA in its Resolution dated 5 May 2004.
[7]

In a letter dated 24 March 2004,[8] Judge Cobarde apologized for his non-
compliance with the directives of the OCA. He also admitted his delay in deciding
the subject civil case, but explained that the same was unintentional. Attached to
the letter was a copy of his Decision on Civil Case No. 2928-L dated 22 March 2004.
[9]

In its Resolution dated 23 June 2004,[10] the Court noted Judge Cobarde's letter
dated 24 March 2004.

Later, Judge Cobarde filed a Comment dated 28 June 2004[11] informing the Court
that he already filed before the OCA his letter dated 24 March 2004 commenting on
the complaint with a copy of his Decision dated 22 March 2004. He also stated
therein that he would abide by whatever action the Court may take on the matter.

The Court noted the Comment in its Resolution dated 11 August 2004,[12] and
referred the matter to the OCA for evaluation, report, and recommendation.

In a Memorandum dated 8 October 2004[13] addressed to then (now retired)

Associate Justice Artemio V. Panganiban, the OCA observed that Judge Cobarde took
almost three (3) years to finally decide Civil Case No. 2928-L, clearly beyond the 90-
day reglementary period mandated by Article VIII, Section 15(1) of the Constitution,
without bothering to request for an extension of time to decide the same nor giving
any reason for such delay. Worse, he ignored no less than four (4) directives
requiring his comment on the matter.

Thus, the OCA recommended that Judge Cobarde be fined P15,000.00 for undue
delay in rendering a decision and an additional P5,000.00 for failure to comply with
the lawful orders of the Court, and be sternly warned that a repetition of the same
or similar act will be dealt with more severely.

We adopt the findings and the recommendation of the OCA.

Indeed, competence and diligence are prerequisites to the due performance of

judicial office.[14] Judges are enjoined to perform all judicial duties, including the
delivery of reserved decisions, efficiently, fairly, and with reasonable promptness.
[15] Mandatory rules prescribing the time to render judgment and to resolve
pending incidents within 90 days from the time of submission for resolution are
considered absolutely indispensable to the prevention of needless delays and the
orderly and speedy discharge of judicial business.[16]

The failure to decide a case within the required period is inexcusable as it

constitutes gross inefficiency and neglect of duty warranting administrative
sanction.[17] Section 9 (1), Rule 140 of the Rules of Court, as amended by A.M. No.
01-10-SC, provides that undue delay in rendering a decision or order is classified as
a less serious charge which, under Section 11 (B), is punishable by suspension from
office without salary and other benefits for no less than one (1) nor more than three
(3) months; or a fine of more than P10,000.00 but not exceeding P20,000.00.

Moreover, Judge Cobarde should be reminded that it is through the OCA that the
Supreme Court exercises supervision over all lower courts and personnel thereof.
His prolonged and repeated refusal to comply with the directives of the OCA to
comment on the complaint constitutes a clear and willful disrespect for lawful orders
of the OCA.[18] Such defiance is gross insubordination meriting the imposition of a
fine of P5,000.00.[19]

WHEREFORE, in light of the foregoing, Judge Benedicto G. Cobarde of the Regional

Trial Court of Lapu-Lapu City, Branch 53 is FINED the amount of P15,000.00 for his
undue delay in rendering a decision in Civil Case No. 2928-L and the additional
amount of P5,000.00 for his failure to comply with the lawful orders of this Court.
Further, Judge Cobarde is STERNLY WARNED that a repetition of the same or similar
act shall be dealt with more severely.

SO ORDERED.

ANTONIO EDUARDO B. NACHURA

Associate Justice

FIRST DIVISION

COMMISSIONER OF G.R. No. 159694

INTERNAL REVENUE,
Petitioner, Present:
Panganiban, CJ,
- versus - Chairman,
Ynares-Santiago,
Austria-Martinez,
AZUCENA T. REYES, Callejo, Sr., and
Respondent. Chico-Nazario, JJ
x -- -- -- -- -- -- -- -- -- -- -- -- -- x

AZUCENA T. REYES, G.R. No. 163581

Petitioner,
- versus -
COMMISSIONER OF Promulgated:
 INTERNAL REVENUE,
Respondent. January 27, 2006
x -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- x
Under the present provisions of the Tax Code and pursuant to elementary due
process, taxpayers must be informed in writing of the law and the facts upon which
a tax assessment is based; otherwise, the assessment is void. Being invalid, the
assessment cannot in turn be used as a basis for the perfection of a tax
compromise.

The Case

Before us are two consolidated[1] Petitions for Review[2] filed under Rule 45 of the
Rules of Court, assailing the August 8, 2003 Decision[3] of the Court of Appeals (CA)
in CA-GR SP No. 71392. The dispositive portion of the assailed Decision reads as
follows:

WHEREFORE, the petition is GRANTED. The assailed decision of the Court of Tax
Appeals is ANNULLED and SET ASIDE without prejudice to the action of the National
Evaluation Board on the proposed compromise settlement of the Maria C. Tancinco
estates tax liability.[4]

The Facts

The CA narrated the facts as follows:

On July 8, 1993, Maria C. Tancinco (or decedent) died, leaving a 1,292 square-meter
residential lot and an old house thereon (or subject property) located at 4931 Pasay
Road, Dasmarias Village, Makati City.

On the basis of a sworn information-for-reward filed on February 17, 1997 by a

certain Raymond Abad (or Abad), Revenue District Office No. 50 (South Makati)
conducted an investigation on the decedents estate (or estate). Subsequently, it
issued a Return Verification Order. But without the required preliminary findings
being submitted, it issued Letter of Authority No. 132963 for the regular
investigation of the estate tax case. Azucena T. Reyes (or [Reyes]), one of the
decedents heirs, received the Letter of Authority on March 14, 1997.

On February 12, 1998, the Chief, Assessment Division, Bureau of Internal Revenue
(or BIR), issued a preliminary assessment notice against the estate in the amount of
P14,580,618.67. On May 10, 1998, the heirs of the decedent (or heirs) received a
final estate tax assessment notice and a demand letter, both dated April 22, 1998,
for the amount of P14,912,205.47, inclusive of surcharge and interest.

On June 1, 1998, a certain Felix M. Sumbillo (or Sumbillo) protested the assessment
[o]n behalf of the heirs on the ground that the subject property had already been
sold by the decedent sometime in 1990.

On November 12, 1998, the Commissioner of Internal Revenue (or [CIR]) issued a
preliminary collection letter to [Reyes], followed by a Final Notice Before Seizure
dated December 4, 1998.

On January 5, 1999, a Warrant of Distraint and/or Levy was served upon the estate,
followed on February 11, 1999 by Notices of Levy on Real Property and Tax Lien
against it.

On March 2, 1999, [Reyes] protested the notice of levy. However, on March 11,
1999, the heirs proposed a compromise settlement of P1,000,000.00.

In a letter to [the CIR] dated January 27, 2000, [Reyes] proposed to pay 50% of the
basic tax due, citing the heirs inability to pay the tax assessment. On March 20,
2000, [the CIR] rejected [Reyess] offer, pointing out that since the estate tax is a
charge on the estate and not on the heirs, the latters financial incapacity is
immaterial as, in fact, the gross value of the estate amounting to P32,420,360.00 is
more than sufficient to settle the tax liability. Thus, [the CIR] demanded payment of
the amount of P18,034,382.13 on or before April 15, 2000[;] otherwise, the notice of
sale of the subject property would be published.
On April 11, 2000, [Reyes] again wrote to [the CIR], this time proposing to pay 100%
of the basic tax due in the amount of P5,313,891.00. She reiterated the proposal in
a letter dated May 18, 2000.

As the estate failed to pay its tax liability within the April 15, 2000 deadline, the
Chief, Collection Enforcement Division, BIR, notified [Reyes] on June 6, 2000 that the
subject property would be sold at public auction on August 8, 2000.

On June 13, 2000, [Reyes] filed a protest with the BIR Appellate Division. Assailing
the scheduled auction sale, she asserted that x x x the assessment, letter of
demand[,] and the whole tax proceedings against the estate are void ab initio. She
offered to file the corresponding estate tax return and pay the correct amount of tax
without surcharge [or] interest.

Without acting on [Reyess] protest and offer, [the CIR] instructed the Collection
Enforcement Division to proceed with the August 8, 2000 auction sale.
Consequently, on June 28, 2000, [Reyes] filed a [P]etition for [R]eview with the
Court of Tax Appeals (or CTA), docketed as CTA Case No. 6124.

On July 17, 2000, [Reyes] filed a Motion for the Issuance of a Writ of Preliminary
Injunction or Status Quo Order, which was granted by the CTA on July 26, 2000.
Upon [Reyess] filing of a surety bond in the amount of P27,000,000.00, the CTA
issued a [R]esolution dated August 16, 2000 ordering [the CIR] to desist and refrain
from proceeding with the auction sale of the subject property or from issuing a
[W]arrant of [D]istraint or [G]arnishment of [B]ank [A]ccount[,] pending
determination of the case and/or unless a contrary order is issued.

[The CIR] filed a [M]otion to [D]ismiss the petition on the grounds (i) that the CTA no
longer has jurisdiction over the case[,] because the assessment against the estate
is already final and executory; and (ii) that the petition was filed out of time. In a
[R]esolution dated November 23, 2000, the CTA denied [the CIRs] motion.

During the pendency of the [P]etition for [R]eview with the CTA, however, the BIR
issued Revenue Regulation (or RR) No. 6-2000 and Revenue Memorandum Order (or
RMO) No. 42-2000 offering certain taxpayers with delinquent accounts and disputed
assessments an opportunity to compromise their tax liability.

On November 25, 2000, [Reyes] filed an application with the BIR for the compromise
settlement (or compromise) of the assessment against the estate pursuant to Sec.
204(A) of the Tax Code, as implemented by RR No. 6-2000 and RMO No. 42-2000.

On December 26, 2000, [Reyes] filed an Ex-Parte Motion for Postponement of the
hearing before the CTA scheduled on January 9, 2001, citing her pending application
for compromise with the BIR. The motion was granted and the hearing was reset to
February 6, 2001.

On January 29, 2001, [Reyes] moved for postponement of the hearing set on
February 6, 2001, this time on the ground that she had already paid the
compromise amount of P1,062,778.20 but was still awaiting approval of the National
Evaluation Board (or NEB). The CTA granted the motion and reset the hearing to
February 27, 2001.

On February 19, 2001, [Reyes] filed a Motion to Declare Application for the
Settlement of Disputed Assessment as a Perfected Compromise. In said motion, she
alleged that [the CIR] had not yet signed the compromise[,] because of procedural
red tape requiring the initials of four Deputy Commissioners on relevant documents
before the compromise is signed by the [CIR]. [Reyes] posited that the absence of
the requisite initials and signature[s] on said documents does not vitiate the
perfected compromise.

Commenting on the motion, [the CIR] countered that[,] without the approval of the
NEB, [Reyess] application for compromise with the BIR cannot be considered a
perfected or consummated compromise.

On March 9, 2001, the CTA denied [Reyess] motion, prompting her to file a Motion
for Reconsideration Ad Cautelam. In a [R]esolution dated April 10, 2001, the CTA
denied the [M]otion for [R]econsideration with the suggestion that[,] for an orderly
presentation of her case and to prevent piecemeal resolutions of different issues,
[Reyes] should file a [S]upplemental [P]etition for [R]eview[,] setting forth the new
issue of whether there was already a perfected compromise.

On May 2, 2001, [Reyes] filed a Supplemental Petition for Review with the CTA,
followed on June 4, 2001 by its Amplificatory Arguments (for the Supplemental
Petition for Review), raising the following issues:

1. Whether or not an offer to compromise by the [CIR], with the acquiescence by the
Secretary of Finance, of a tax liability pending in court, that was accepted and paid
by the taxpayer, is a perfected and consummated compromise.

2. Whether this compromise is covered by the provisions of Section 204 of the Tax
Code (CTRP) that requires approval by the BIR [NEB].

Answering the Supplemental Petition, [the CIR] averred that an application for
compromise of a tax liability under RR No. 6-2000 and RMO No. 42-2000 requires
the evaluation and approval of either the NEB or the Regional Evaluation Board (or
REB), as the case may be.

On June 14, 2001, [Reyes] filed a Motion for Judgment on the Pleadings; the motion
was granted on July 11, 2001. After submission of memoranda, the case was
submitted for [D]ecision.

On June 19, 2002, the CTA rendered a [D]ecision, the decretal portion of which
pertinently reads:

WHEREFORE, in view of all the foregoing, the instant [P]etition for [R]eview is
hereby DENIED. Accordingly, [Reyes] is hereby ORDERED to PAY deficiency estate
tax in the amount of Nineteen Million Five Hundred Twenty Four Thousand Nine
Hundred Nine and 78/100 (P19,524,909.78), computed as follows:

xxxxxxxxx

[Reyes] is likewise ORDERED to PAY 20% delinquency interest on deficiency estate

tax due of P17,934,382.13 from January 11, 2001 until full payment thereof
pursuant to Section 249(c) of the Tax Code, as amended.

In arriving at its decision, the CTA ratiocinated that there can only be a perfected
and consummated compromise of the estates tax liability[,] if the NEB has approved
[Reyess]
application for compromise in accordance with RR No. 6-2000, as implemented by
RMO No. 42-2000.

Anent the validity of the assessment notice and letter of demand against the estate,
the CTA stated that at the time the questioned assessment notice and letter of
demand were issued, the heirs knew very well the law and the facts on which the
same were based. It also observed that the petition was not filed within the 30-day
reglementary period provided under Sec. 11 of Rep. Act No. 1125 and Sec. 228 of
the Tax Code.[5]

Ruling of the Court of Appeals

In partly granting the Petition, the CA said that Section 228 of the Tax Code and RR
12-99 were mandatory and unequivocal in their requirement. The assessment
notice and the demand letter should have stated the facts and the law on which
they were based; otherwise, they were deemed void.[6] The appellate court held
that while administrative agencies, like the BIR, were not bound by procedural
requirements, they were still required by law and equity to observe substantive due
process. The reason behind this requirement, said the CA, was to ensure that
taxpayers would be duly apprised of -- and could effectively protest -- the basis of
tax assessments against them.[7] Since the assessment and the demand were void,
the proceedings emanating from them were likewise void, and any order emanating
from them could never attain finality.

The appellate court added, however, that it was premature to declare as perfected
and consummated the compromise of the estates tax liability. It explained that,
where the basic tax assessed exceeded P1 million, or where the settlement offer
was less than the prescribed minimum rates, the National Evaluation Boards (NEB)
prior evaluation and approval were the conditio sine qua non to the perfection and
consummation of any compromise.[8] Besides, the CA pointed out, Section 204(A)
of the Tax Code applied to all compromises, whether government-initiated or not.[9]
Where the law did not distinguish, courts too should not distinguish.

Hence, this Petition.[10]

The Issues

In GR No. 159694, petitioner raises the following issues for the Courts
consideration:

I.
Whether petitioners assessment against the estate is valid.
II.
Whether respondent can validly argue that she, as well as the other heirs, was not
aware of the facts and the law on which the assessment in question is based, after
she had opted to propose several compromises on the estate tax due, and even
prematurely acting on such proposal by paying 20% of the basic estate tax due.[11]

The foregoing issues can be simplified as follows: first, whether the assessment
against the estate is valid; and, second, whether the compromise entered into is
also valid.

The Courts Ruling

The Petition is unmeritorious.

First Issue:
Validity of the Assessment Against the Estate

The second paragraph of Section 228 of the Tax Code[12] is clear and mandatory. It
provides as follows:

Sec. 228. Protesting of Assessment. --

xxxxxxxxx
The taxpayers shall be informed in writing of the law and the facts on which the
assessment is made: otherwise, the assessment shall be void.

In the present case, Reyes was not informed in writing of the law and the facts on
which the assessment of estate taxes had been made. She was merely notified of
the findings by the CIR, who had simply relied upon the provisions of former Section
229[13] prior to its amendment by Republic Act (RA) No. 8424, otherwise known as
the Tax Reform Act of 1997.

First, RA 8424 has already amended the provision of Section 229 on protesting an
assessment. The old requirement of merely notifying the taxpayer of the CIRs
findings was changed in 1998 to informing the taxpayer of not only the law, but also
of the facts on which an assessment would be made; otherwise, the assessment
itself would be invalid.

It was on February 12, 1998, that a preliminary assessment notice was issued
against the estate. On April 22, 1998, the final estate tax assessment notice, as well
as demand letter, was also issued. During those dates, RA 8424 was already in
effect. The notice required under the old law was no longer sufficient under the new
law.

To be simply informed in writing of the investigation being conducted and of the

recommendation for the assessment of the estate taxes due is nothing but a
perfunctory discharge of the tax function of correctly assessing a taxpayer. The act
cannot be taken to mean that Reyes already knew the law and the facts on which
the assessment was based. It does not at all conform to the compulsory
requirement under Section 228. Moreover, the Letter of Authority received by
respondent on March 14, 1997 was for the sheer purpose of investigation and was
not even the requisite notice under the law.

The procedure for protesting an assessment under the Tax Code is found in Chapter
III of Title VIII, which deals with remedies. Being procedural in nature, can its
provision then be applied retroactively? The answer is yes.

The general rule is that statutes are prospective. However, statutes that are
remedial, or that do not create new or take away vested rights, do not fall under the
general rule against the retroactive operation of statutes.[14] Clearly, Section 228
provides for the procedure in case an assessment is protested. The provision does
not create new or take away vested rights. In both instances, it can surely be
applied retroactively. Moreover, RA 8424 does not state, either expressly or by
necessary implication, that pending actions are excepted from the operation of
Section 228, or that applying it to pending proceedings would impair vested rights.

Second, the non-retroactive application of Revenue Regulation (RR) No. 12-99 is of

no moment, considering that it merely implements the law.

A tax regulation is promulgated by the finance secretary to implement the

provisions of the Tax Code.[15] While it is desirable for the government authority or
administrative agency to have one immediately issued after a law is passed, the
absence of the regulation does not automatically mean that the law itself would
become inoperative.

At the time the pre-assessment notice was issued to Reyes, RA 8424 already stated
that the taxpayer must be informed of both the law and facts on which the
assessment was based. Thus, the CIR should have required the assessment officers
of the Bureau of Internal Revenue (BIR) to follow the clear mandate of the new law.
The old regulation governing the issuance of estate tax assessment notices ran
afoul of the rule that tax regulations -- old as they were -- should be in harmony
with, and not supplant or modify, the law.[16]

It may be argued that the Tax Code provisions are not self-executory. It would be too
wide a stretch of the imagination, though, to still issue a regulation that would
simply require tax officials to inform the taxpayer, in any manner, of the law and the
facts on which an assessment was based. That requirement is neither difficult to
make nor its desired results hard to achieve.

Moreover, an administrative rule interpretive of a statute, and not declarative of

certain rights and corresponding obligations, is given retroactive effect as of the
date of the effectivity of the statute.[17] RR 12-99 is one such rule. Being
interpretive of the provisions of the Tax Code, even if it was issued only on
September 6, 1999, this regulation was to retroact to January 1, 1998 -- a date prior
to the issuance of the preliminary assessment notice and demand letter.

Third, neither Section 229 nor RR 12-85 can prevail over Section 228 of the Tax
Code.

No doubt, Section 228 has replaced Section 229. The provision on protesting an
assessment has been amended. Furthermore, in case of discrepancy between the
law as amended and its implementing but old regulation, the former necessarily
prevails.[18] Thus, between Section 228 of the Tax Code and the pertinent
provisions of RR 12-85, the latter cannot stand because it cannot go beyond the
provision of the law. The law must still be followed, even though the existing tax
regulation at that time provided for a different procedure. The regulation then
simply provided that notice be sent to the respondent in the form prescribed, and
that no consequence would ensue for failure to comply with that form.

Fourth, petitioner violated the cardinal rule in administrative law that the taxpayer
be accorded due process. Not only was the law here disregarded, but no valid notice
was sent, either. A void assessment bears no valid fruit.
The law imposes a substantive, not merely a formal, requirement. To proceed
heedlessly with tax collection without first establishing a valid assessment is
evidently violative of the cardinal principle in administrative investigations: that
taxpayers should be able to present their case and adduce supporting evidence.[19]
In the instant case, respondent has not been informed of the basis of the estate tax
liability. Without complying with the unequivocal mandate of first informing the
taxpayer of the governments claim, there can be no deprivation of property,
because no effective protest can be made.[20] The haphazard shot at slapping an
assessment, supposedly based on estate taxations general provisions that are
expected to be known by the taxpayer, is utter chicanery.

Even a cursory review of the preliminary assessment notice, as well as the demand
letter sent, reveals the lack of basis for -- not to mention the insufficiency of -- the
gross figures and details of the itemized deductions indicated in the notice and the
letter. This Court cannot countenance an assessment based on estimates that
appear to have been arbitrarily or capriciously arrived at. Although taxes are
the lifeblood of the government, their assessment and collection should be made in
accordance with law as any arbitrariness will negate the very reason for
government itself.[21]

Fifth, the rule against estoppel does not apply. Although the government cannot be
estopped by the negligence or omission of its agents, the obligatory provision on
protesting a tax assessment cannot be rendered nugatory by a mere act of the CIR .

Tax laws are civil in nature.[22] Under our Civil Code, acts executed against the
mandatory provisions of law are void, except when the law itself authorizes the
validity of those acts.[23] Failure to comply with Section 228 does not only render
the assessment void, but also finds no validation in any provision in the Tax Code.
We cannot condone errant or enterprising tax officials, as they are expected to be
vigilant and law-abiding.

Second Issue:
Validity of Compromise

It would be premature for this Court to declare that the compromise on the estate
tax liability has been perfected and consummated, considering the earlier
determination that the assessment against the estate was void. Nothing has been
settled or finalized. Under Section 204(A) of the Tax Code, where the basic tax
involved exceeds one million pesos or the settlement offered is less than the
prescribed minimum rates, the compromise shall be subject to the approval of the
NEB composed of the petitioner and four deputy commissioners.

Finally, as correctly held by the appellate court, this provision applies to all
compromises, whether government-initiated or not. Ubi lex non distinguit, nec nos
distinguere debemos. Where the law does not distinguish, we should not
distinguish.

WHEREFORE, the Petition is hereby DENIED and the assailed Decision AFFIRMED. No
pronouncement as to costs.

SO ORDERED.

PEOPLE vs QUIACHON GR 170236

Facts: Appellant Roberto Quiachon was charged with the crime of qualified rape. On
or about May 12, 2001, the accused, by means of force and intimidation had sexual
intercourse with one Rowena Quiachon, his daughter, 8 years old, a deaf-mute
minor. Rowel recounted that on the night of May 12, 2001, Rowel saw his father on
top of his sister Rowena and they were covered by a blanket or "kumot." His father's
buttocks were moving up and down, and Rowel could hear Rowena crying. He could
not do anything because he was afraid of their father. Rowel remained in the room
but the following morning, he told his aunt, Carmelita Mateo about what he had
witnessed. Together, Carmelita and Rowel went to the police to report what had
transpired.

The Regional Trial Court found the appellant guilty beyond reasonable doubt of the
crime of qualified rape defined and penalized under Articles 266-A and B of the
Revised Penal Code. The court imposed death penalty against the accused. The
defense argued that the benefits of RA 9346 should be extended to the accused.
Issue: Whether the appellant can benefit from R.A. 9346 which abolished the death
penalty law.

Held: Yes. In view of the enactment of Republic Act (R.A.) No. 9346 on June 24, 2006
prohibiting the imposition of the death penalty, the penalty to be meted on
appellant is reclusion perpetua in accordance with Section 2 thereof which reads:

SECTION 2. In lieu of the death penalty, the following shall be imposed:

the penalty of reclusion perpetua, when the law violated makes use of the
nomenclature of the penalties of the Revised Penal Code; or

(b) the penalty of life imprisonment, when the law violated does not make use of
the nomenclature of the penalties of the Revised Penal Code.

The aforequoted provision of R.A. No. 9346 is applicable in this case pursuant to the
principle in criminal law, favorabilia sunt amplianda adiosa restrigenda. Penal laws
which are favorable to accused are given retroactive effect. This principle is
embodied under Article 22 of the Revised Penal Code, which provides as follows:
Retroactive effect of penal laws. Penal laws shall have a retroactive effect insofar
as they favor the persons guilty of a felony, who is not a habitual criminal, as this
term is defined in Rule 5 of Article 62 of this Code, although at the time of the
publication of such laws, a final sentence has been pronounced and the convict is
serving the same.

However, appellant is not eligible for parole because Section 3 of R.A. No. 9346
provides that "persons convicted of offenses punished with reclusion perpetua, or
whose sentences will be reduced to reclusion perpetua by reason of the law, shall
not be eligible for parole."

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-15127 May 30, 1961

EMETERIO CUI, plaintiff-appellant,

vs.
ARELLANO UNIVERSITY, defendant-appellee.

Appeal by plaintiff Emeterio Cui from a decision of the Court of First Instance of
Manila, absolving defendant Arellano University from plaintiff's complaint, with costs
against the plaintiff, and dismissing defendant's counter claim, for insufficiency of
proof thereon.

In the language of the decision appealed from:

The essential facts of this case are short and undisputed. As established by the
agreement of facts Exhibits X and by the respective oral and documentary evidence
introduced by the parties, it appears conclusive that plaintiff, before the school year
1948-1949 took up preparatory law course in the defendant University. After
finishing his preparatory law course plaintiff enrolled in the College of Law of the
defendant from the school year 1948-1949. Plaintiff finished his law studies in the
defendant university up to and including the first semester of the fourth year.
During all the school years in which plaintiff was studying law in defendant law
college, Francisco R. Capistrano, brother of the mother of plaintiff, was the dean of
the College of Law and legal counsel of the defendant university. Plaintiff enrolled
for the last semester of his law studies in the defendant university but failed to pay
his tuition fees because his uncle Dean Francisco R. Capistrano having severed his
connection with defendant and having accepted the deanship and chancellorship of
the College of Law of Abad Santos University, plaintiff left the defendant's law
college and enrolled for the last semester of his fourth year law in the college of law
of the Abad Santos University graduating from the college of law of the latter
university. Plaintiff, during all the time he was studying law in defendant university
was awarded scholarship grants, for scholastic merit, so that his semestral tuition
fees were returned to him after the ends of semester and when his scholarship
grants were awarded to him. The whole amount of tuition fees paid by plaintiff to
defendant and refunded to him by the latter from the first semester up to and
including the first semester of his last year in the college of law or the fourth year, is
in total P1,033.87. After graduating in law from Abad Santos University he applied to
take the bar examination. To secure permission to take the bar he needed the
transcripts of his records in defendant Arellano University. Plaintiff petitioned the
latter to issue to him the needed transcripts. The defendant refused until after he
had paid back the P1,033 87 which defendant refunded to him as above stated. As
he could not take the bar examination without those transcripts, plaintiff paid to
defendant the said sum under protest. This is the sum which plaintiff seeks to
recover from defendant in this case.

Before defendant awarded to plaintiff the scholarship grants as above stated, he

was made to sign the following contract covenant and agreement:

"In consideration of the scholarship granted to me by the University, I hereby waive

my right to transfer to another school without having refunded to the University
(defendant) the equivalent of my scholarship cash.

(Sgd.) Emeterio Cui".

It is admitted that, on August 16, 1949, the Director of Private Schools issued
Memorandum No. 38, series of 1949, on the subject of "Scholarship," addressed to
"All heads of private schools, colleges and universities," reading:

1. School catalogs and prospectuses submitted to this, Bureau show that some
schools offer full or partial scholarships to deserving students for excellence in
scholarship or for leadership in extra-curricular activities. Such inducements to poor
but gifted students should be encouraged. But to stipulate the condition that such
scholarships are good only if the students concerned continue in the same school
nullifies the principle of merit in the award of these scholarships.

2. When students are given full or partial scholarships, it is understood that such
scholarships are merited and earned. The amount in tuition and other fees
corresponding to these scholarships should not be subsequently charged to the
recipient students when they decide to quit school or to transfer to another
institution. Scholarships should not be offered merely to attract and keep students
in a school.

3. Several complaints have actually been received from students who have enjoyed
scholarships, full or partial, to the effect that they could not transfer to other
schools since their credentials would not be released unless they would pay the fees
corresponding to the period of the scholarships. Where the Bureau believes that the
right of the student to transfer is being denied on this ground, it reserves the right
to authorize such transfer.

that defendant herein received a copy of this memorandum; that plaintiff asked the
Bureau of Private Schools to pass upon the issue on his right to secure the transcript
of his record in defendant University, without being required to refund the sum of
P1,033.87; that the Bureau of Private Schools upheld the position taken by the
plaintiff and so advised the defendant; and that, this notwithstanding, the latter
refused to issue said transcript of records, unless said refund were made, and even
recommended to said Bureau that it issue a written order directing the defendant to
release said transcript of record, "so that the case may be presented to the court for
judicial action." As above stated, plaintiff was, accordingly, constrained to pay, and
did pay under protest, said sum of P1,033.87, in order that he could take the bar
examination in 1953. Subsequently, he brought this action for the recovery of said
amount, aside from P2,000 as moral damages, P500 as exemplary damages, P2,000
as attorney's fees, and P500 as expenses of litigation.

In its answer, defendant reiterated the stand it took, vis-a-vis the Bureau of Private
Schools, namely, that the provisions of its contract with plaintiff are valid and
binding and that the memorandum above-referred to is null and void. It, likewise,
set up a counterclaim for P10,000.00 as damages, and P3,000 as attorney's fees.

The issue in this case is whether the above quoted provision of the contract
between plaintiff and the defendant, whereby the former waived his right to transfer
to another school without refunding to the latter the equivalent of his scholarships
in cash, is valid or not. The lower court resolved this question in the affirmative,
upon the ground that the aforementioned memorandum of the Director of Private
Schools is not a law; that the provisions thereof are advisory, not mandatory in
nature; and that, although the contractual provision "may be unethical, yet it was
more unethical for plaintiff to quit studying with the defendant without good reasons
and simply because he wanted to follow the example of his uncle." Moreover,
defendant maintains in its brief that the aforementioned memorandum of the
Director of Private Schools is null and void because said officer had no authority to
issue it, and because it had been neither approved by the corresponding
department head nor published in the official gazette.

We do not deem it necessary or advisable to consider as the lower court did, the
question whether plaintiff had sufficient reasons or not to transfer from defendant
University to the Abad Santos University. The nature of the issue before us, and its
far reaching effects, transcend personal equations and demand a determination of
the case from a high impersonal plane. Neither do we deem it essential to pass
upon the validity of said Memorandum No. 38, for, regardless of the same, we are of
the opinion that the stipulation in question is contrary to public policy and, hence,
null and void. The aforesaid memorandum merely incorporates a sound principle of
public policy. As the Director of Private Schools correctly pointed, out in his letter,
Exhibit B, to the defendant,

There is one more point that merits refutation and that is whether or not the
contract entered into between Cui and Arellano University on September 10, 1951
was void as against public policy. In the case of Zeigel vs. Illinois Trust and Savings
Bank, 245 Ill. 180, 19 Ann. Case 127, the court said: 'In determining a public policy
of the state, courts are limited to a consideration of the Constitution, the judicial
decisions, the statutes, and the practice of government officers.' It might take more
than a government bureau or office to lay down or establish a public policy, as
alleged in your communication, but courts consider the practices of government
officials as one of the four factors in determining a public policy of the state. It has
been consistently held in America that under the principles relating to the doctrine
of public policy, as applied to the law of contracts, courts of justice will not
recognize or uphold a transaction which its object, operation, or tendency is
calculated to be prejudicial to the public welfare, to sound morality or to civic
honesty (Ritter vs. Mutual Life Ins. Co., 169 U.S. 139; Heding vs. Gallaghere 64
L.R.A. 811; Veazy vs. Allen, 173 N.Y. 359). If Arellano University understood clearly
the real essence of scholarships and the motives which prompted this office to issue
Memorandum No. 38, s. 1949, it should have not entered into a contract of waiver
with Cui on September 10, 1951, which is a direct violation of our Memorandum and
an open challenge to the authority of the Director of Private Schools because the
contract was repugnant to sound morality and civic honesty. And finally, in Gabriel
vs. Monte de Piedad, Off. Gazette Supp. Dec. 6, 1941, p. 67 we read: 'In order to
declare a contract void as against public policy, a court must find that the contract
as to consideration or the thing to be done, contravenes some established interest
of society, or is inconsistent with sound policy and good morals or tends clearly to
undermine the security of individual rights. The policy enunciated in Memorandum
No. 38, s. 1949 is sound policy. Scholarship are awarded in recognition of merit not
to keep outstanding students in school to bolster its prestige. In the understanding
of that university scholarships award is a business scheme designed to increase the
business potential of an education institution. Thus conceived it is not only
inconsistent with sound policy but also good morals. But what is morals? Manresa
has this definition. It is good customs; those generally accepted principles of
morality which have received some kind of social and practical confirmation. The
practice of awarding scholarships to attract students and keep them in school is not
good customs nor has it received some kind of social and practical confirmation
except in some private institutions as in Arellano University. The University of the
Philippines which implements Section 5 of Article XIV of the Constitution with
reference to the giving of free scholarships to gifted children, does not require
scholars to reimburse the corresponding value of the scholarships if they transfer to
other schools. So also with the leading colleges and universities of the United States
after which our educational practices or policies are patterned. In these institutions
scholarships are granted not to attract and to keep brilliant students in school for
their propaganda mine but to reward merit or help gifted students in whom society
has an established interest or a first lien. (Emphasis supplied.)

WHEREFORE, the decision appealed from is hereby reversed and another one shall
be entered sentencing the defendant to pay to the plaintiff the sum of P1,033.87,
with interest thereon at the legal rate from September 1, 1954, date of the
institution of this case, as well as the costs, and dismissing defendant's
counterclaim. It is so ordered.

THIRD DIVISION

PUBLIC ESTATES G.R. No. 158812

AUTHORITY and MANUEL R.
BERINA, JR., in his capacity as Present:
the Acting General Manager of
the Public Estates Authority, PANGANIBAN, Chairman,
Petitioners, SANDOVAL-GUTIERREZ,
CORONA,
CARPIO MORALES, and
GARCIA, JJ.
-versus-
Promulgated:

October 5, 2005
BOLINAO SECURITY AND
INVESTIGATION SERVICE,
INC.,
Respondent.
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - x

DECISION

Before this Court is a Petition for Review of the Court of Appeals Decision [1] dated
May 30, 2002 which affirmed that of the Makati Regional Trial Court, Branch 58,
dated April 22, 1992 declaring null and void the award by the Philippine Estates
Authority (PEA) of a bid in favor of Masada Security Agency and declaring
Bolinao Security and Investigation Service Inc. as the winning bidder for the April
10, 1991 bidding for security services.
On February 1, 1990, the PEA, a government corporation, through its then Acting
General Manager Luis B. Pangilinan, Jr., entered into a Contract for Security
Services[2] with Bolinao Security and Investigation Services, Inc. (Bolinao
Security), to secure and protect PEAs properties, personnel and premises at Villa
Porta Vaga Subdivision, Cavite City. The contract was effective February 1, 1990
until January 31, 1991, extendible at the option of PEA.[3]

In December 1990, PEA published in several newspapers an Invitation to Bid [4] for
the services of three hundred seven (307) regular and well-trained guards for its
establishments, facilities, and other properties in Metro Manila including those in
Cavite City. The Invitation to Bid read:

INVITATION TO BID
 Interested bidders are invited to participate in the public bidding for Security
Services for the following areas:

(1) 6th and 7th Floor, Legaspi Towers 200, Makati, Metro Manila
(2) Central Business Park (CBP) I Pasay City
(3) Freedom Islands I and II Paraaque, Metro Manila
(4) Fishermans Wharf, Paraaque, Metro Manila
(5) Aguinaldo Blvd. (Coastal Road or R-I) Paraaque-Las Pias, Metro Manila
(6) Lopez, Bernabe, Madrigal-Relocation Sites Las Pias
(7) Financial Center Area Pasay City
(8) Villa Porta Vaga (Caacao Bay) Cavite City

Interested bidders may request for copies of the Terms of Reference for this
bidding, from the Administrative Department of PEA, beginning on Dec. 17, 1990
up to Dec. 21, 1990 during regular working hours from 9:00 AM-6:00 PM.

All sealed bids must be received by the PEA Prequalification Bids and Awards
Committee on or before 10:00 AM of December 27, 1990 at the 7 th Floor, Legaspi
Towers 200, Paseo de Roxas, Makati, Metro Manila and will be publicly opened
and read on the said bidding date at the same address, in the presence of attending
bidders or their duly authorized representatives and the general public. A Pre-bid
conference will be conducted by the PBAC on Dec. 24, 1990 at 10:00 AM.
Attendance to this Pre-bid conference is mandatory.

PEA reserves the right to reject any proposal or waive any defects or
formality, impose additional terms and conditions and accept the proposal
most advantageous to the Government. (Emphasis supplied)[5]

The Terms of Reference (TOR) for Security Services [6] listed the following
documents which an interested party should submit to PEA to qualify to bid:

(a) Certified xerox copy of Current License to Operate;

(b) Certified xerox copy of Articles of Incorporation;

(c) Description of the organization, including its objectives and the names,
nationality and experience of key officials;

(d) Certified list of firearms, communication equipment, service vehicles and

other equipment with their corresponding licenses to operate said
equipment;

(e) List of existing clients;

(f) Detailed financial statements (balance sheets and profits and loss
statements) as of September 1990 and Income Tax Return duly filed and
received by the Bureau of Internal Revenue (BIR);

(g) Certification of up-to-date payments of Social Security Services (SSS)

Contributions;

(h) Bank certification of standby credit in the amount of TWO MILLION

PESOS (P2,000,000.00);
(i) Certification of deposit from Philippine National Bank (PNB) or any
reputable bank equivalent to one (1) monthly salary of three hundred seven
(307) guards to be used exclusively for their salaries.(Emphasis and
underscoring supplied)[7]
On December 19, 1990, a pre-bid conference was held attended by twenty-one (21)
interested security agencies. Following the conference, Bid Bulletin No. 1 dated
December 21, 1990 amending, clarifying and/or supplementing the TOR was
issued to all prospective bidders.

On the scheduled bidding on December 27, 1990, only six (6) out of the twenty-
one (21) interested bidders showed up, namely: Integrity Security and Intelligence
Service (Integrity Security); Bolinao Security; Odin Security Agency, Inc.; Masada
Security Agency, Inc. (Masada Security); Catalina Security Agency, Inc. and
Montillano Security Agency.

For alleged general non-compliance by bidders with bid qualification, PEAs

Prequalification Bids and Awards Committee (PBAC) rejected all the 6 bids and
thus scheduled a rebidding for security services contract.

In the meantime, after the contract with Bolinao Security expired on January 31,
1991, it was extended monthly by PEA up to July 29, 1991.[8]

The re-bidding was scheduled on April 10, 1991 and all the 21 bidders were again
invited to submit their bids. Bid Bulletin No. 2 [9] was thereafter issued modifying
the TOR originally issued.

On April 3, 1991, a pre-bid conference was held and on April 10, 1991, the bids
were opened.

The PBACs technical working group thereafter issued Bid Evaluation [10] dated June
11, 1991 tabulating the result of the bidding as follows:

BIDDERS LIQUIDATED REMARKS

DAMAGES
(p/ struct.)

1. Integrity Security 25,000 No SSS Clearance

2. Bolinao Security 20,000 No current license to operate
3. Masada 6,500 Complying
4. Odin Security 5,500 Complying
5. Catalina Security 5,000 Complying
6. Montillano Security 5,000 Only application for Permit To Purchase radio eqpt.[11]

The evaluation noted that all the bidders offered a bid price of P1,499,695.00 per
month. PEA thus based the award on the amount of liquidated damages
representing the total penalty to be paid by the security agency if it failed to
prevent the construction of a shanty by a squatter in the Manila Bay reclamation
properties of PEA.

The report, noting that Integrated Security submitted the highest bid in terms of
liquidated damages but had no SSS clearance, and Bolinao Security submitted the
next highest bid but had no current license to operate, recommended that Masada
Security which proffered the third highest bid be considered the winning bidder.[12]

Heeding the PBACs recommendation, PEA awarded the contract to Masada

Security effective September 1, 1991 up to April 30, 1993. [13] Bolinao Security
whose contract with PEA expired on January 31, 1991 but was, as earlier stated,
extended monthly up to July 29, 1991, refused to turn over the PEA properties in
Cavite City, however, to Masada Security, prompting PEA to send a demand letter
to Bolinao Security to turn over the property to Masada Security.

Bolinao Security insisted to PEA, however, that it should be declared the winning
bidder. But PEA explained that the bid of Bolinao Security was rejected because it
failed to submit a current license to operate and to award the contract to it despite
that would violate Presidential Decree (P.D.) No. 1919.[14]

On September 16, 1991, Bolinao Security filed with the Regional Trial Court of
Makati a complaint[15] for annulment of bid award, damages, injunction with
special prayer for the issuance of a temporary restraining order against PEA, its
Acting General Manager Manuel Berina, Jr., and Masada Security, averring that,
among other things, the attempt of Masada Security to take over the Cavite City
premises from it based on the result of the bidding was improper, illegal, criminal
and violative of the provisions of the Anti-Graft and Corrupt Practices Act.[16]

In its Answer,[17] PEA, denying Bolinao Securitys allegations, alleged that the
contract for security services for its properties situated in Cavite City with Bolinao
Security, as extended, had already been terminated effective September 16, 1991;
bidding laws were strictly followed and the bid of Bolinao Security was twice
rejected for non-compliance with important requirements of the bidding; Bolinao
Security failed to offer the highest liquidated damages; and awarding the contract
to Bolinao Security would violate P.D. No. 1919 as well as the National
Accounting and Auditing Manual.

Masada Security, in its Answer with Compulsory Counterclaim, [18] proffered that
Bolinao Security had no valid cause of action, hence, not entitled to a writ of
preliminary injunction.

By Order of October 14, 1991, the trial court issued a writ of preliminary
injunction enjoining the defendants from terminating the contract with Bolinao
Security covering PEAs Cavite City property.[19]

After trial on the merits, the trial court, by Decision of April 22, 1992, found for
Bolinao Security and declared the contract awarded to Masada Security null and
void. The decretal text of the decision reads:

WHEREFORE, premises considered, judgment is rendered in favor of the

plaintiff with the following dispositions:

1) The writ of preliminary injunction issued in this case, which enjoins

defendants from terminating the existing contract for security services with
plaintiff, and from implementing the questioned contract in favor of Masada
Security Agency effective September 17, 1991, and from ejecting plaintiff
from the Villa Porta Vaga Subdivision, Canacao, Cavite City, is made
permanent.

2) The award of the bid in favor of defendant Masada Security Agency is

declared null and void and plaintiff Bolinao is declared as the winning bidder
during the public bidding held on April 10, 1991.

3) Directing the defendants to jointly and severally pay to the plaintiff the
amount of P50,000.00 as nominal damages, P50,000.00 as exemplary
damages; attorneys fees; and the costs of suit.

SO ORDERED.[20] (Underscoring supplied)

On appeal, the Court of Appeals affirmed the decision of the trial court by Decision
of May 30, 2002.

In affirming the trial courts decision, the appellate court held that disqualifying
Bolinao Security for the simple reason that on the day of the bidding its application
for renewal of its license was still being processed was most unfair, arbitrary and
has no legal basis as the period for processing thereof is a bureaucratic requirement
which sh[ould] not work against the interest of [Bolinao Security], absen[t] any
badge of fraud or negligence.[21]

Even assuming that Bolinao Securitys pending application for renewal of license
did not serve as proof of a current license to operate, the appellate court held that
still PEA was estopped when it opened the second envelope containing the bid.[22]

The appellate court went on to declare that the rule that the doctrine of estoppel
does not lie against the government is not without exception, it holding that while
the State could not be put in estoppel by the mistakes or errors of its officials or
agents, the government must not be allowed to deal dishonorably or capriciously
with its citizens;[23] and while the government was not precluded from subsequently
raising the issue of lack of qualification on the part of Bolinao Security, the same
must be supported by law and equity.[24]

Hence, the present petition for review filed on July 24, 1003 by PEA and its Acting
General Manager Manuel R. Berina, Jr.,[25] raising the following issues:

WHETHER OR NOT RESPONDENT BOLINAO SECURITY AND

INVESTIGATION SERVICE, INC. IS A QUALIFIED BIDDER, DESPITE ITS
NON-COMPLIANCE WITH THE BIDDING REQUIREMENTS.

II

WHETHER OR NOT THE LOWER COURTS RULINGS CONSTITUTE AN

UNJUSTIFIED JUDICIAL INTERVENTION OVER PURELY EXECUTIVE
MATTERS AND FUNCTIONS.[26]

PEA argues that, inter alia, the lower courts rulings constituted an unjustified
judicial intervention over purely executive matters and functions; [27] where the
invitation to bid provides that the government may reject any or all bids or any part
thereof or waive any defects contained therein and accept an offer most
advantageous to the government, the highest or lowest bidder, as the case may be,
cannot claim the award as a matter of right; [28] it should not be considered in
estoppel by opening and reading the bids of BolinaoSecurity since it (PEA)
declared, aside from its published reservation, that it reserved the right to reject any
bid;[29] and at all events, Bolinao Security failed to submit the most advantageous
bid.[30]

The petition is meritorious.

The issue in the main is whether the thrashing out of Bolinao Securitys bid in favor
of Masada Security was justified by PEA in view of the formers lack of current
license to operate at the time of the opening of the bids on April 10, 1991 and
PEAs right to reject any or all bids stipulation in the Invitation to Bid.

As priorly stated, the contract for security services between Bolinao Security and
PEA took effect on February 1, 1990 until January 31, 1991. [31] As its license to
operate was to expire on March 31, 1991, Bolinao Security filed on February 28,
1991 an application for a new license which was granted and issued only on May
16, 1991, after the April 10, 1991 bidding. Evidently, at the time of the bidding,
Bolinao Security had no current license to operate as required by the TOR.

Bolinao Security argues, however, that since PEA had given it several extensions
after its license to operate expired and as its new license was eventually issued on
May 16, 1991, such new license should have been given retroactive effect.

At any rate, Bolinao Security argues that while PEA has the right to reject any
proposal, it has also the right to waive any defects.

Bolinao Securitys position fails.

PEAs granting of extensions to Bolinao Security after its license expired cannot be
interpreted as a waiver of the requirement of a current license.

Waiver is defined as the relinquishment of a known right with knowledge of its

existence and an intention to relinquish it. Voluntary choice is the essence of
waiver.[32] To be valid and effective, a waiver must in the first place be couched in
clear and unequivocal terms which leave no doubt as to the intention of a person to
give up a right or benefit which legally pertains to him. It may not causally be
attributed to a person when the terms thereof do not explicitly and clearly evidence
an intent to abandon a right vested in such person.[33]

Extension of the effectivity of the security service contract can not be interpreted
as an extension of the effectivity of license to operate a security agency. Neither
can the new license issued to Bolinao Security be given retroactive effect without
running afoul of the rule in public biddings that qualifications of bidders shall be
determined at the time of the opening of the bids, and not at any other time. The
National Accounting and Auditing Manual is explicit on the matter:

SEC. 391. Opening of bids. Bids shall be opened at the exact hour announced for
such opening in the notice or advertisement, and in the presence of all bidders, if
possible. Bids for public services or for furnishing supplies, materials, and
equipment to the government shall be opened in the presence of a committee to be
designated by the head of the office and a representative of the Auditor General
who is authorized to secure and identify such papers and samples as will insure
the proper safeguard of the interests of the Government.

Before the actual opening of the sealed bids, the committee shall acquaint itself
with the conditions imposed by the notice or advertisement upon all prospective
bidders, especially those with reference to the personal qualifications of the
contractor, if any; the amount and character of deposits to be submitted with the
bid, etc. No bid presented after the expiration of the time set for the opening shall
be received. Bids shall be in sealed envelopes only. Bids by telegram, telephone,
radiogram, or open bids shall not be accepted; they are not valid. A bid opened
which does not meet in full the conditions or requirements of the notice or
advertisement shall be disqualified and shall not be considered in any award to be
made, but notation thereof shall be entered in the abstract of proposals giving the
reason or reasons for the disqualification of such bid. An imperfect bid, i.e., a
 bid which does not comply with all the conditions or requirements in the
notice or advertisement, or complies with them partly but not in full may not
be perfected after the time set for the opening of the bids has already elapsed,
much less after the bids have been opened. Bids which offer other conditions
than those specified in the advertisement such as in the quantity, quality or
manner of rendering the service, or supplying the materials or supplies being
bidded, or the time of performance under the resulting contract, etc., will likewise
be ineligible for an award, but the proposal will be noted in the abstract with a
memorandum why the said proposal has been disqualified for an award.
(Emphasis supplied)

Thus, in Republic v. Capulong,[34] the therein private respondent bidder urged this
Court to consider a 1952 Opinion of the Secretary of Justice which declared that
the failure of the lowest bidder to secure a license as a transportation operator at
the time of the opening of the bids did not affect its bid. In debunking the therein
private respondents appeal, this Court held that the invitation to bid issued by the
then Department of Agriculture and Natural Resources contained no requirement
that the bidder must be a duly licensed transportation operator at the time of the
opening of the bids,[35] in stark contrast to the requirement involved in the instant
case.

And in C & C Commercial v. Menor,[36] this Court upheld NAWASAs rejection of

the bid to supply asbestos cement pressure proffered by C and C Commercial
which did not submit the required tax clearance certificate.

Bolinao Securitys argument that PEA was estopped from questioning its
qualifications, it asserting that by opening the second/bid envelope, the eligibility
and qualification requirements of the bidding were deemed complied with, does
not persuade.

Bid Bulletin No. 2[37] expressly provides:

TERMS OF REFERENCE FOR

SECURITY SERVICES
BID BULLETIN NO. 2

This Bid Bulletin No. 2 is hereby issued for your information and inclusion in the
Terms of Reference already issued, as follows:

1. Section A. Bid Price

Delete the entire section and substitute the following:

Section A. Bid/Tender

1) Bid Price

All prices quoted shall not be below the existing minimum rate
prescribed by PC-SUSSUA-PADPAO.

2) Submission
Bids shall be submitted in two (2) sealed envelopes with the name
of the project to be bid and the name of the bidder in capital letters
addressed to the PBAC. They shall be marked Do not open before 2:00 P.
M. of 10 April 1991.
 The first envelope shall contain the following
information/documents:

a) Obligations of Contractor as specified in Section C.[38]

b) Bid Security in the proper form and amount.

It shall be opened first to determine the contractors compliance with the

above requirements. Non-compliance with any of the above requirements
shall automatically disqualify the bid submitted.

The second envelope shall contain the following information/documents:

a) Bid Price
b) Breakdown of Bid Price
c) Amount of Liquidated Damages

It shall be opened only if the contractor has complied with the requirements
needed in the first envelope. (Emphasis and Footnote supplied)

In Information Technology Foundation of the Philippines v. Commission on

Elections,[39] the question of qualification or eligibility of a bidder in a public
bidding conducted by the Commission on Elections (COMELEC) to procure
election automation machines was in issue.

The public bidding conducted by the COMELEC observed a two-envelope/two-

stage system. The bidders first envelope or the Eligibility Envelope was to
establish the bidders eligibility to bid and its qualifications to perform the acts if
accepted. The second envelope contained the Bid Envelope itself.

The COMELECs Request for Proposal (RFP) to procure the election automation
machines stated, however, that the eligibility envelopes of prospective [b]idders
shall be opened first to determine their eligibility. In case any of the requirements
specified in Clause 20 is missing from the first bid envelope, the BAC shall declare
said prospective [b]idder as ineligible to bid. Bid envelopes of ineligible [b]idders
shall be immediately returned unopened.[40]

The winning bidders Bid Envelope was opened by the COMELEC despite its lack
of qualification or eligibility. This Court, however, disqualified such winning
bidder.

So must Bolinao Security be disqualified.

The basic rule in public bidding that bids should be evaluated on the basis of the
required documents submitted before and not after the opening of bids must be
strictly observed in order to safeguard a fair, honest and competitive public
bidding.[41]

At all events, as PEA argues, assuming arguendo that Bolinao Security was
deemed to have complied with the current license requirement, since the Invitation
to Bid expressly provided that PEA reserves the right to reject any proposal or
waive any defects or formality, impose additional terms and conditions and accept
the proposal most advantageous to the Government, Bolinao Security voluntarily
submitted itself to the terms and conditions thereof and acknowledged the said
right of the government.
In Bureau Veritas v. Office of the President,[42] this Court through the erudite
expatiation of Justice Melencio-Herrera discussed profoundly the legal
implications of the right to reject any or all bids in an invitation to bid, viz:

xxx It must be stressed, as held in the case of A.C. Esguerra & Sons v. Aytona, et
al. (L-18751, 28 April 1962, 4 SCRA 1245) , that in an invitation to bid, there is a
condition imposed upon the bidders to the effect that the bidding shall be subject
to the right of the government to reject any and all bids subject to its discretion. In
the case at bar, the government has made its choice and unless an unfairness
or injustice is shown, the losing bidders have no cause to complain nor right
to dispute that choice. This is a well-settled doctrine in this jurisdiction and
elsewhere.

This discretion to accept or reject a bid and award contracts is vested in the
Government agencies entrusted with that function. The discretion given to
the authorities on this matter is of such wide latitude that the Courts will not
interfere therewith, unless it is apparent that it is used as a shield to a
fraudulent award (Jalandoni v. NARRA, 108 Phil. 486 [1960]). xxx The choice
of who among the bidders is best qualified to perform this task should be left to
the sound discretion of the proper Government authorities in the executive branch
since they are in a better position than the Courts to make the determination
owing to the experience and knowledge that they have acquired by virtue of their
functions. The exercise of this discretion is a policy decision that necessitates
prior inquiry, investigation, comparison, evaluation, and deliberation. This task
can best be discharged by the Government agencies concerned, not by the Courts.
The role of the Courts is to ascertain whether a branch or instrumentality of the
Government has transgressed its constitutional boundaries. But the Courts will not
interfere with executive or legislative discretion exercised within those
boundaries. Otherwise, it strays into the realm of policy decision-making.
It is only upon a clear showing of grave abuse of discretion that the Courts
will set aside the award of a contract made by a government entity. Grave
abuse of discretion implies a capricious, arbitrary and whimsical exercise of
power xxx. The abuse of discretion must be so patent and gross as to amount to an
evasion of positive duty or to a virtual refusal to perform a duty enjoined by law,
as to act at all in contemplation of law, where the power is exercised in an
arbitrary and despotic manner by reason of passion or hostility xxx.

xxx. In the Invitation to Prequalify and Bid xxx, the CISS Committee made an
express reservation of the right of the Government to reject any or all bids or any
part thereof or waive any defects contained thereon and accept an offer most
advantageous to the Government. It is well-settled rule that where such
reservation is made in an Invitation to Bid, the highest or lowest bidder, as
the case may be, is not entitled to an award as a matter of right (C & C
Commercial Corp. v. Menor, L-28360, 27 January 1983, 120 SCRA 112). Even
the lowest Bid or any Bid may be rejected or, in the exercise of sound
discretion, the award may be made to another than the lowest bidder (A. C.
Esguerra & Sons v. Aytona, supra, citing 43 Am. Jur., 788). (Emphasis and
underscoring supplied)

Similarly, in National Power Corporation v. Philipp Brothers Oceanic, Inc.,[43] this

Court declared that where the right to reject is so reserved, the lowest bid or any
bid for that matter may be rejected on a mere technicality. And where the
government as advertiser, availing itself of that right, makes its choice in rejecting
any or all bids, the losing bidder has no cause to complain nor right to dispute that
choice unless an unfairness or injustice is shown. Citing Celeste v. Court of
Appeals,[44] this Court went on to declare:

Verily, a reservation of the government of its right to reject any bid, generally
vests in the authorities a wide discretion as to who is the best and most
 advantageous bidder. The exercise of such discretion involves inquiry,
investigation, comparison, deliberation and decision, which are quasi-judicial
functions, and when honestly exercised, may not be reviewed by the court.
xxx (Emphasis supplied)

Only recently, this Court in JG Summit Holdings, Inc. v. Court of Appeals[45] held:

It is a settled rule that where the invitation to bid contains a reservation for
the Government to reject any or all bids, the lowest or the highest bidder, as
the case may be, is not entitled to an award as a matter of right for it does not
become a ministerial duty of the Government to make such an award.
Thus, it has been held that where the right to reject is so reserved, the lowest
bid or any bid for that matter may be rejected on a mere technicality, that all
bids may be rejected, even if arbitrarily and unwisely, or under a mistake,
and that in the exercise of a sound discretion, the award may be made to
another than the lowest bidder. And so, where the Government as advertiser,
availing itself of that right, makes its choice in rejecting any or all bids, the losing
bidder has no cause to complain nor right to dispute that
choice, unless an unfairness or injustice is shown. (Emphasis and underscoring
supplied)[46]

Clearly, as spelled out in the foregoing disquisitions, the government is granted

broad discretion in choosing who among the bidders can offer the most
advantageous terms and courts will not interfere therewith or direct the committee
on bids to do a particular act or to enjoin such act within its prerogatives, except
when in the exercise of its authority, it gravely abuses or exceeds its jurisdiction.[47]

A reading of the decisional rules on reservation of right to reject cautions, however,

against injustice, unfairness, arbitrariness, fraudulent acts or grave abuse of
discretion.[48] A contrary conclusion would be anathema to the purposes for which
public biddings are founded to give the public the best possible advantages through
open competition as it would give the unscrupulous a plain escape to rig the
bidding process.

Thus segueing to the issue of whether PEAs choice of Masada Security over that of
Bolinao Security was tainted with injustice, unfairness, arbitrariness or fraud or
whether it constituted grave abuse of discretion, this Court finds that Bolinao
Security failed to prove the same.

The presumption of regularity of the bidding must thus remain.

As reflected above, competitive public bidding aims to protect the public interest
by giving the public the best possible advantages through open competition. It is a
mechanism that enables the government agency to avoid or preclude anomalies in
the execution of public contracts.[49] Authorities should not thus be permitted to
waive any substantial variance between the conditions under which bids are invited
and the proposals submitted. If one bidder is relieved from conforming with the
conditions which impose some duty upon it or lay the ground for holding it to a
strict performance of its contract, that bidder is not contracting in fair competition
with those bidders who propose to be bound by all the conditions.[50]

In fine, the PEA did not commit grave abuse of discretion in selecting the bid of
Masada Security as the most advantageous to the government.
WHEREFORE, the decision of the Court of Appeals dated May 30, 2002
is REVERSED and SET ASIDE and the complaint of respondent, Bolinao
Security and Investigation Service, Inc. is DISMISSED.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 163707 September 15, 2006

MICHAEL C. GUY, petitioner,

vs.
HON. COURT OF APPEALS, HON. SIXTO MARELLA, JR., Presiding Judge, RTC, Branch 138,
Makati City and minors, KAREN DANES WEI and KAMILLE DANES WEI, represented by their
mother, REMEDIOS OANES, respondents.

This petition for review on certiorari assails the January 22, 2004 Decision1 of the Court of Appeals in
CA-G.R. SP No. 79742, which affirmed the Orders dated July 21, 20002 and July 17, 20033 of the
Regional Trial Court of Makati City, Branch 138 in SP Proc. Case No. 4549 denying petitioner's motion
to dismiss; and its May 25, 2004 Resolution4 denying petitioner's motion for reconsideration.

The facts are as follows:

On June 13, 1997, private respondent-minors Karen Oanes Wei and Kamille Oanes Wei, represented by
their mother Remedios Oanes (Remedios), filed a petition for letters of administration5 before the
Regional Trial Court of Makati City, Branch 138. The case was docketed as Sp. Proc. No. 4549 and
entitled Intestate Estate of Sima Wei (a.k.a. Rufino Guy Susim).
Private respondents alleged that they are the duly acknowledged illegitimate children of Sima Wei, who
died intestate in Makati City on October 29, 1992, leaving an estate valued at P10,000,000.00 consisting
of real and personal properties. His known heirs are his surviving spouse Shirley Guy and children, Emy,
Jeanne, Cristina, George and Michael, all surnamed Guy. Private respondents prayed for the appointment
of a regular administrator for the orderly settlement of Sima Wei's estate. They likewise prayed that, in the
meantime, petitioner Michael C. Guy, son of the decedent, be appointed as Special Administrator of the
estate. Attached to private respondents' petition was a Certification Against Forum Shopping6 signed by
their counsel, Atty. Sedfrey A. Ordoez.
In his Comment/Opposition,7 petitioner prayed for the dismissal of the petition. He asserted that his
deceased father left no debts and that his estate can be settled without securing letters of administration
pursuant to Section 1, Rule 74 of the Rules of Court. He further argued that private respondents should
have established their status as illegitimate children during the lifetime of Sima Wei pursuant to Article
175 of the Family Code.
The other heirs of Sima Wei filed a Joint Motion to Dismiss8 on the ground that the certification against
forum shopping should have been signed by private respondents and not their counsel. They contended
that Remedios should have executed the certification on behalf of her minor daughters as mandated by
Section 5, Rule 7 of the Rules of Court.
In a Manifestation/Motion as Supplement to the Joint Motion to Dismiss,9 petitioner and his co-heirs
alleged that private respondents' claim had been paid, waived, abandoned or otherwise extinguished by
reason of Remedios' June 7, 1993 Release and Waiver of Claim stating that in exchange for the financial
and educational assistance received from petitioner, Remedios and her minor children discharge the estate
of Sima Wei from any and all liabilities.

The Regional Trial Court denied the Joint Motion to Dismiss as well as the Supplemental Motion to
Dismiss. It ruled that while the Release and Waiver of Claim was signed by Remedios, it had not been
established that she was the duly constituted guardian of her minor daughters. Thus, no renunciation of
right occurred. Applying a liberal application of the rules, the trial court also rejected petitioner's
objections on the certification against forum shopping.
Petitioner moved for reconsideration but was denied. He filed a petition for certiorari before the Court of
Appeals which affirmed the orders of the Regional Trial Court in its assailed Decision dated January 22,
2004, the dispositive portion of which states:
WHEREFORE, premises considered, the present petition is hereby DENIED DUE COURSE and
accordingly DISMISSED, for lack of merit. Consequently, the assailed Orders dated July 21, 2000 and
July 17, 2003 are hereby both AFFIRMED. Respondent Judge is hereby DIRECTED to resolve the
controversy over the illegitimate filiation of the private respondents (sic) minors [-] Karen Oanes Wei and
Kamille Oanes Wei who are claiming successional rights in the intestate estate of the deceased Sima Wei,
a.k.a. Rufino Guy Susim.
SO ORDERED.10

The Court of Appeals denied petitioner's motion for reconsideration, hence, this petition.
Petitioner argues that the Court of Appeals disregarded existing rules on certification against forum
shopping; that the Release and Waiver of Claim executed by Remedios released and discharged the Guy
family and the estate of Sima Wei from any claims or liabilities; and that private respondents do not have
the legal personality to institute the petition for letters of administration as they failed to prove their
filiation during the lifetime of Sima Wei in accordance with Article 175 of the Family Code.
Private respondents contend that their counsel's certification can be considered substantial compliance
with the rules on certification of non-forum shopping, and that the petition raises no new issues to warrant
the reversal of the decisions of the Regional Trial Court and the Court of Appeals.
The issues for resolution are: 1) whether private respondents' petition should be dismissed for failure to
comply with the rules on certification of non-forum shopping; 2) whether the Release and Waiver of
Claim precludes private respondents from claiming their successional rights; and 3) whether private
respondents are barred by prescription from proving their filiation.
The petition lacks merit.
Rule 7, Section 5 of the Rules of Court provides that the certification of non-forum shopping should be
executed by the plaintiff or the principal party. Failure to comply with the requirement shall be cause for
dismissal of the case. However, a liberal application of the rules is proper where the higher interest of
justice would be served. In Sy Chin v. Court of Appeals,11 we ruled that while a petition may have been
flawed where the certificate of non-forum shopping was signed only by counsel and not by the party, this
procedural lapse may be overlooked in the interest of substantial justice.12 So it is in the present
controversy where the merits13 of the case and the absence of an intention to violate the rules with
impunity should be considered as compelling reasons to temper the strict application of the rules.
As regards Remedios' Release and Waiver of Claim, the same does not bar private respondents from
claiming successional rights. To be valid and effective, a waiver must be couched in clear and
unequivocal terms which leave no doubt as to the intention of a party to give up a right or benefit which
legally pertains to him. A waiver may not be attributed to a person when its terms do not explicitly and
clearly evince an intent to abandon a right.14
In this case, we find that there was no waiver of hereditary rights. The Release and Waiver of Claim does
not state with clarity the purpose of its execution. It merely states that Remedios received P300,000.00
and an educational plan for her minor daughters "by way of financial assistance and in full settlement of
any and all claims of whatsoever nature and kind x x x against the estate of the late Rufino Guy
Susim."15 Considering that the document did not specifically mention private respondents' hereditary
share in the estate of Sima Wei, it cannot be construed as a waiver of successional rights.
Moreover, even assuming that Remedios truly waived the hereditary rights of private respondents, such
waiver will not bar the latter's claim. Article 1044 of the Civil Code, provides:
ART. 1044. Any person having the free disposal of his property may accept or repudiate an inheritance.
Any inheritance left to minors or incapacitated persons may be accepted by their parents or guardians.
Parents or guardians may repudiate the inheritance left to their wards only by judicial authorization.
The right to accept an inheritance left to the poor shall belong to the persons designated by the testator to
determine the beneficiaries and distribute the property, or in their default, to those mentioned in Article
1030. (Emphasis supplied)
Parents and guardians may not therefore repudiate the inheritance of their wards without judicial
approval. This is because repudiation amounts to an alienation of property16 which must pass the court's
scrutiny in order to protect the interest of the ward. Not having been judicially authorized, the Release and
Waiver of Claim in the instant case is void and will not bar private respondents from asserting their rights
as heirs of the deceased.
Furthermore, it must be emphasized that waiver is the intentional relinquishment of a known right. Where
one lacks knowledge of a right, there is no basis upon which waiver of it can rest. Ignorance of a material
fact negates waiver, and waiver cannot be established by a consent given under a mistake or
misapprehension of fact.17
In the present case, private respondents could not have possibly waived their successional rights because
they are yet to prove their status as acknowledged illegitimate children of the deceased. Petitioner himself
has consistently denied that private respondents are his co-heirs. It would thus be inconsistent to rule that
they waived their hereditary rights when petitioner claims that they do not have such right. Hence,
petitioner's invocation of waiver on the part of private respondents must fail.
Anent the issue on private respondents' filiation, we agree with the Court of Appeals that a ruling on the
same would be premature considering that private respondents have yet to present evidence. Before the
Family Code took effect, the governing law on actions for recognition of illegitimate children was Article
285 of the Civil Code, to wit:
ART. 285. The action for the recognition of natural children may be brought only during the lifetime of
the presumed parents, except in the following cases:
(1) If the father or mother died during the minority of the child, in which case the latter may file the
action before the expiration of four years from the attainment of his majority;
(2) If after the death of the father or of the mother a document should appear of which nothing had been
heard and in which either or both parents recognize the child.
In this case, the action must be commenced within four years from the finding of the document.
(Emphasis supplied)
We ruled in Bernabe v. Alejo18 that illegitimate children who were still minors at the time the Family
Code took effect and whose putative parent died during their minority are given the right to seek
recognition for a period of up to four years from attaining majority age. This vested right was not
impaired or taken away by the passage of the Family Code.19
On the other hand, Articles 172, 173 and 175 of the Family Code, which superseded Article 285 of the
Civil Code, provide:
ART. 172. The filiation of legitimate children is established by any of the following:
(1 The record of birth appearing in the civil register or a final judgment; or
(2) An admission of legitimate filiation in a public document or a private handwritten instrument and
signed by the parent concerned.

In the absence of the foregoing evidence, the legitimate filiation shall be proved by:
(1) The open and continuous possession of the status of a legitimate child; or
(2) Any other means allowed by the Rules of Court and special laws.
ART. 173. The action to claim legitimacy may be brought by the child during his or her lifetime and shall
be transmitted to the heirs should the child die during minority or in a state of insanity. In these cases, the
heirs shall have a period of five years within which to institute the action.
The action already commenced by the child shall survive notwithstanding the death of either or both of
the parties.
ART. 175. Illegitimate children may establish their illegitimate filiation in the same way and on the same,
evidence as legitimate children.
The action must be brought within the same period specified in Article 173, except when the action is
based on the second paragraph of Article 172, in which case the action may be brought during the lifetime
of the alleged parent.
Under the Family Code, when filiation of an illegitimate child is established by a record of birth
appearing in the civil register or a final judgment, or an admission of filiation in a public document or a
private handwritten instrument signed by the parent concerned, the action for recognition may be brought
by the child during his or her lifetime. However, if the action is based upon open and continuous
possession of the status of an illegitimate child, or any other means allowed by the rules or special laws, it
may only be brought during the lifetime of the alleged parent.
It is clear therefore that the resolution of the issue of prescription depends on the type of evidence to be
adduced by private respondents in proving their filiation. However, it would be impossible to determine
the same in this case as there has been no reception of evidence yet. This Court is not a trier of facts. Such
matters may be resolved only by the Regional Trial Court after a full-blown trial.
While the original action filed by private respondents was a petition for letters of administration, the trial
court is not precluded from receiving evidence on private respondents' filiation. Its jurisdiction extends to
matters incidental and collateral to the exercise of its recognized powers in handling the settlement of the
estate, including the determination of the status of each heir.20 That the two causes of action, one to
compel recognition and the other to claim inheritance, may be joined in one complaint is not new in our
jurisprudence.21 As held in Briz v. Briz:22
The question whether a person in the position of the present plaintiff can in any event maintain a complex
action to compel recognition as a natural child and at the same time to obtain ulterior relief in the
character of heir, is one which in the opinion of this court must be answered in the affirmative, provided
always that the conditions justifying the joinder of the two distinct causes of action are present in the
particular case. In other words, there is no absolute necessity requiring that the action to compel
acknowledgment should have been instituted and prosecuted to a successful conclusion prior to the action
in which that same plaintiff seeks additional relief in the character of heir. Certainly, there is nothing so
peculiar to the action to compel acknowledgment as to require that a rule should be here applied different
from that generally applicable in other cases. x x x

The conclusion above stated, though not heretofore explicitly formulated by this court, is undoubtedly to
some extent supported by our prior decisions. Thus, we have held in numerous cases, and the doctrine
must be considered well settled, that a natural child having a right to compel acknowledgment, but who
has not been in fact acknowledged, may maintain partition proceedings for the division of the inheritance
against his coheirs (Siguiong vs. Siguiong, 8 Phil., 5; Tiamson vs. Tiamson, 32 Phil., 62); and the same
person may intervene in proceedings for the distribution of the estate of his deceased natural father, or
mother (Capistrano vs. Fabella, 8 Phil., 135; Conde vs. Abaya, 13 Phil., 249; Ramirez vs. Gmur, 42 Phil.,
855). In neither of these situations has it been thought necessary for the plaintiff to show a prior decree
compelling acknowledgment. The obvious reason is that in partition suits and distribution proceedings the
other persons who might take by inheritance are before the court; and the declaration of heirship is
appropriate to such proceedings.
WHEREFORE, the instant petition is DENIED. The Decision dated January 22, 2004 of the Court of
Appeals in CA-G.R. SP No. 79742 affirming the denial of petitioner's motion to dismiss; and its
Resolution dated May 25, 2004 denying petitioner's motion for reconsideration, are AFFIRMED. Let the
records be REMANDED to the Regional Trial Court of Makati City, Branch 138 for further proceedings.
SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. Nos. 119987-88 October 12, 1995
THE PEOPLE OF THE PHILIPPINES, petitioner,
vs.
HON. LORENZO B. VENERACION, Presiding Judge of the Regional Trial Court, National Capital
Judicial Region, Branch 47, Manila, HENRY LAGARTO y PETILLA and ERNESTO CORDERO,
respondents.

The sole issue in the case at bench involves a question of law. After finding that an accused individual in
a criminal case has, on the occasion of Rape, committed Homicide, is the judge allowed any discretion in
imposing either the penalty of Reclusion Perpetua or Death?

The facts antecedent to the case before this Court, as narrated by petitioner, 1 involve the perpetration of
acts so bizarre and devoid of humanity as to horrify and numb the senses of all civilized men:

On August 2, 1994, the cadaver of a young girl, later identified as Angel Alquiza wrapped in a sack and
yellow table cloth tied with a nylon cord with both feet and left hand protruding from it was seen floating
along Del Pan St. near the corner of Lavesares St., Binondo, Manila.

When untied and removed from its cover, the lifeless body of the victim was seen clad only in a light
colored duster without her panties, with gaping wounds on the left side of the face, the left chin, left ear,
lacerations on her genitalia, and with her head bashed in.

On the basis of sworn statements of witnesses, booking sheets, arrest reports and the necropsy report of
the victim, Abundio Lagunday, a.k.a. Jr. Jeofrey of no fixed address, and Henry Lagarto y Petilla, of 288
Area H. Parola Compound, Tondo, Manila were later charged with the crime of Rape with Homicide in an
Information dated August 8, 1994 filed with the Regional Trial Court of Manila, National Capital Judicial
Region. Said Information, docketed as Criminal Case No. 94-138071, reads:

That on or about August 2, 1994, in the City of Manila, Philippines, the said accused, conspiring and
confederating together with one alias "LANDO" and other persons whose true names, identifies and
present whereabouts are still unknown and helping one another, with treachery, taking advantage of their
superior strength and nocturnity, and ignominy, and with the use of force and violence, that is, by taking
ANGEL ALQUIZA y LAGMAN into a warehouse, covering her mouth, slashing her vagina, hitting her
head with a thick piece of wood and stabbing her neck did then and there wilfully, unlawfully and
feloniously have carnal knowledge of the person of said ANGEL ALQUIZA y LAGMAN, a minor, seven
(7) years of age, against the latter's will and consent and on said occasion the said ABUNDIO
LAGUNDAY, a.k.a. "LANDO" and others, caused her fatal injuries which were the direct cause of her
death immediately thereafter.

CONTRARY TO LAW.

Subsequently thereafter, Ernesto Cordero y Maristela, a.k.a. "Booster," of 1198 Sunflower St., Tondo,
Manila, Rolando Manlangit y Mamerta, a.k.a. "Lando," of 1274 Kagitingan St., Tondo, Manila, Richard
Baltazar y Alino, a.k.a. "Curimao," also of 1274 Kagitingan St., Tondo, Manila, and Catalino Yaon y
Aberin, a.k.a. "Joel," of 1282 Lualhati St., Tondo, Manila were accused of the same crime of Rape with
Homicide in an Information dated August 11, 1994, docketed as Criminal Case No. 94-138138, allegedly
committed as follows:

That on or about the 2nd day of August, 1994, in the City of Manila, Philippines, the said accused
conspiring and confederating with ABUNDIO LAGUNDAY Alias "JR," JEOFREY and HENRY
LAGARTO y PETILLA who have already been charged in the Regional Trial Court of Manila of the
same offense under Criminal Case No. 94-138071, and helping one another, with treachery, taking
advantage of their superior strength and nocturnity and ignominy, and with the use of force and violence,
that is, by taking ANGEL ALQUIZA y LAGMAN into a pedicab, and once helpless, forcibly bringing her
to a nearby warehouse, covering her mouth, slashing her vagina, hitting her head with a thick piece of
wood and stabbing her neck, did then and there wilfully, unlawfully and feloniously have carnal
knowledge of the person of said ANGEL ALQUIZA y LAGMAN, a minor, seven (7) years of age, against
the latter's will and consent and on said occasion the said accused together with their confederates
ABUNDIO LAGARTO y PETILLA caused her fatal injuries which were the direct cause of her death
immediately thereafter.
CONTRARY TO LAW.

The two criminal cases were consolidated to Branch 47 of the Regional Trial Court of Manila, presided
over by respondent Judge.

Duly arraigned, all the accused, except Abundio Lagunday who was already dead, (allegedly shot by
police escorts after attempting to fire a gun he was able to grab from SPO1 D. Vidad on August 12, 1994),
pleaded "Not Guilty." Abundio Lagunday was dropped from the Information.

After trial and presentation of the evidence of the prosecution and the defense, the trial court rendered a
decision 2 on January 31, 1995 finding the defendants Henry Lagarto y Petilla and Ernesto Cordero y
Maristela guilty beyond reasonable doubt of the crime of Rape with Homicide and sentenced both
accused with the "penalty of reclusion perpetua with all the accessories provided for by law." 3
Disagreeing with the sentence imposed, the City Prosecutor of Manila on February 8, 1995, filed a
Motion for Reconsideration, praying that the Decision be "modified in that the penalty of death be
imposed" against respondents Lagarto and Cordero, in place of the original penalty (reclusion perpetua).
Refusing to act on the merits of the said Motion for Reconsideration, respondent Judge, on February 10,
1995, issued an Order denying the same for lack of jurisdiction. The pertinent portion reads:

The Court believes that in the above-entitled cases, the accused Lagarto and Cordero have complied with
the legal requirements for the perfection of an appeal. Consequently, for lack of jurisdiction, this Court
cannot take cognizance of the Motion for Reconsideration of the Public Prosecutor of Manila.

WHEREFORE, the order earlier issued by this Court regarding the Notices of Appeal filed by both herein
accused is hereby reiterated.

The Clerk of this Court is hereby directed to transmit the complete records of these cases, together with
the notices of appeal, to the Honorable Supreme Court, in accordance with Sec. 8, Rule 122 of the
Revised Rules of Criminal Procedure.

SO ORDERED.

Hence, the instant petition.

The trial court's finding of guilt is not at issue in the case at bench. The basis of the trial court's
determination of guilt and its conclusions will only be subject to our scrutiny at an appropriate time on
appeal. We have thus clinically limited our narration of events to those cold facts antecedent to the instant
case relevant to the determination of the legal question at hand, i.e., whether or not the respondent judge
acted with grave abuse of discretion and in excess of jurisdiction when he failed and/or refused to impose
the mandatory penalty of death under Republic Act No. 7659, after finding the accused guilty of the crime
of Rape with Homicide.

We find for petitioner.

Obedience to the rule of law forms the bedrock of our system of justice. If judges, under the guise of
religious or political beliefs were allowed to roam unrestricted beyond boundaries within which they are
required by law to exercise the duties of their office, then law becomes meaningless. A government of
laws, not of men excludes the exercise of broad discretionary powers by those acting under its authority.
Under this system, judges are guided by the Rule of Law, and ought "to protect and enforce it without fear
or favor," 4 resist encroachments by governments, political parties, 5 or even the interference of their own
personal beliefs.

In the case at bench, respondent judge, after weighing the evidence of the prosecution and the defendant
at trial found the accused guilty beyond reasonable doubt of the crime of Rape with Homicide. Since the
law in force at the time of the commission of the crime for which respondent judge found the accused
guilty was Republic Act No. 7659, he was bound by its provisions.

Section 11 of R.A. No. 7659 provides:

Sec. 11. Article 335 of the same Code is hereby amended to read as follows:

Art. 335. When and how rape is committed. Rape is committed by having carnal knowledge of
a woman under any of the following circumstances:

1. By using force or intimidation.

2. When the woman is deprived of reason or otherwise unconscious; and

3. When the woman is under twelve years of age or is demented.

The crime of rape shall be punished by reclusion perpetua.

Whenever the crime of rape is committed with the use of a deadly weapon or by two or more persons, the
penalty shall be reclusion perpetua to death.

When by reason or on the occasion of the rape, the victim has become insane, the penalty shall be death.

When the rape is attempted or frustrated and a homicide is committed by reason or on the occasion
thereof, the penalty shall be reclusion perpetua to death.

When by reason or on the occasion of the rape, a homicide is committed, the penalty shall be death. . . . 6

Clearly, under the law, the penalty imposable for the crime of Rape with Homicide is not Reclusion
Perpetua but Death. While Republic Act 7659 punishes cases of ordinary rape with the penalty of
Reclusion Perpetua, it allows judges the discretion depending on the existence of circumstances
modifying the offense committed to impose the penalty of either Reclusion Perpetua only in the three
instances mentioned therein. Rape with homicide is not one of these three instances. The law plainly and
unequivocably provides that "[w]hen by reason or on the occasion of rape, a homicide is committed, the
penalty shall be death." The provision leaves no room for the exercise of discretion on the part of the trial
judge to impose a penalty under the circumstances described, other than a sentence of death.

We are aware of the trial judge's misgivings in imposing the death sentence because of his religious
convictions. While this Court sympathizes with his predicament, it is its bounden duty to emphasize that a
court of law is no place for a protracted debate on the morality or propriety of the sentence, where the law
itself provides for the sentence of death as a penalty in specific and well-defined instances. The
discomfort faced by those forced by law to impose the death penalty is an ancient one, but it is a matter
upon which judges have no choice. Courts are not concerned with the wisdom, efficacy or morality of
laws. In People vs. Limaco 7 we held that:

[W]hen . . . private opinions not only form part of their decision but constitute a decisive factor in arriving
at a conclusion and determination of a case or the penalty imposed, resulting in an illegality and
reversible error, then we are constrained to state our opinion, not only to correct the error but for the
guidance of the courts. We have no quarrel with the trial judge or with anyone else, layman or jurist as to
the wisdom or folly of the death penalty. Today there are quite a number of people who honestly believe
that the supreme penalty is either morally wrong or unwise or ineffective. However, as long as that
penalty remains in the statute books, and as long as our criminal law provides for its imposition in certain
cases, it is the duty of judicial officers to respect and apply the law regardless of their private opinions. It
is a well settled rule that the courts are not concerned with the wisdom, efficacy or morality of laws. That
question falls exclusively within the province of the Legislature which enacts them and the Chief
Executive who approves or vetoes them. The only function of the judiciary is to interpret the laws and, if
not in disharmony with the Constitution, to apply them. And for the guidance of the members of the
judiciary we feel it incumbent upon us to state that while they as citizens or as judges may regard a
certain law as harsh, unwise or morally wrong, and may recommend to the authority or department
concerned, its amendment, modification, or repeal, still, as long as said law is in force, they must apply it
and give it effect as decreed by the law-making body. 8

Finally, the Rules of Court mandates that after an adjudication of guilt, the judge should impose "the
proper penalty and civil liability provided for by the law on the accused." 9 This is not a case of a
magistrate ignorant of the law. This is a case in which a judge, fully aware of the appropriate provisions
of the law, refuses to impose a penalty to which he disagrees. In so doing, respondent judge acted without
or in excess of his jurisdiction or with grave abuse of discretion amounting to a lack of jurisdiction in
imposing the penalty of Reclusion Perpetua where the law clearly imposes the penalty of Death.

WHEREFORE, PREMISES CONSIDERED, the instant petition is GRANTED. The case is hereby
REMANDED to the Regional Trial Court for the imposition of the penalty of death upon private
respondents in consonance with respondent judge's finding that the private respondents in the instant case
had committed the crime of Rape with Homicide under Article 335 of the Revised Penal Code, as
amended by Section 11 of Republic Act No. 7659, subject to automatic review by this Court of the
decision imposing the death penalty.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
 EN BANC

G.R. No. L-44896 July 31, 1936

RODOLFO A. SCHNECKENBURGER, petitioner,

vs.
MANUEL V. MORAN, Judge of First Instance of Manila, respondent.

The petitioner was duly accredited honorary consul of Uruguay at Manila, Philippine Islands on June 11,
1934. He was subsequently charged in the Court of First Instance of Manila with the crime of falsification
of a private document. He objected to the jurisdiction of the court on the ground that both under the
Constitution of the United States and the Constitution of the Philippines the court below had no
jurisdiction to try him. His objection having been overruled, he filed this petition for a writ of prohibition
with a view to preventing the Court of First Instance of Manila from taking cognizance of the criminal
action filed against him.

In support of this petition counsel for the petitioner contend (1) That the Court of First Instance of Manila
is without jurisdiction to try the case filed against the petitioner for the reason that under Article III,
section 2, of the Constitution of the United States, the Supreme Court of the United States has original
jurisdiction in all cases affecting ambassadors, other public ministers, and consuls, and such jurisdiction
excludes the courts of the Philippines; and (2) that even under the Constitution of the Philippines original
jurisdiction over cases affecting ambassadors, other public ministers, and consuls, is conferred
exclusively upon the Supreme Court of the Philippines.

This case involves no question of diplomatic immunity. It is well settled that a consul is not entitled to the
privileges and immunities of an ambassador or minister, but is subject to the laws and regulations of the
country to which he is accredited. (Ex parte Baiz, 135 U. S., 403; 34 Law. ed., 222.) A consul is not
exempt from criminal prosecution for violations of the laws of the country where he resides. (U. S. vs.
Ravara, 2 Dall., 297; 1 Law. ed., 388; Wheaton's International Law [2d ed.], 423.) The substantial
question raised in this case is one of jurisdiction.

1. We find no merit in the contention that Article III, section 2, of the Constitution of the United States
governs this case. We do not deem it necessary to discuss the question whether the constitutional
provision relied upon by the petitioner extended ex propio vigore over the Philippines. Suffice it to say
that the inauguration of the Philippine Commonwealth on November 15, 1935, has brought about a
fundamental change in the political and legal status of the Philippines. On the date mentioned the
Constitution of the Philippines went into full force and effect. This Constitution is the supreme law of the
land. Not only the members of this court but all other officers, legislative, executive and judicial, of the
Government of the Commonwealth, are bound by oath to support the Constitution. (Article XIII, section
2.) This court owes its own existence to the great instrument, and derives all its powers therefrom. In the
exercise of its powers and jurisdiction, this court is bound by the provisions of the Constitution. The
Constitution provides that the original jurisdiction of this court "shall include all cases affecting
ambassadors, other public ministers, and consuls." In deciding the instant case this court cannot go
beyond this constitutional provision.

2. It remains to consider whether the original jurisdiction thus conferred upon this court by the
Constitution over cases affecting ambassadors, other public ministers, and consuls, is exclusive. The
Constitution does not define the jurisdiction of this court in specific terms, but merely provides that "the
Supreme Court shall have such original and appellate jurisdiction as may be possessed and exercised by
the Supreme Court of the Philippine Islands at the time of the adoption of this Constitution." It then goes
on to provide that the original jurisdiction of this court "shall include all cases affecting ambassadors,
other public ministers, and consuls."

In the light of the constitutional provisions above adverted to, the question arises whether the original
jurisdiction possessed and exercised by the Supreme Court of the Philippine Islands at the time of the
adoption of the Constitution was exclusive.

The original jurisdiction possessed and exercised by the Supreme Court of the Philippine Islands at the
time of the adoption of the Constitution was derived from section 17 of Act No. 136, which reads as
follows: The Supreme Court shall have original jurisdiction to issue writs of mandamus, certiorari,
prohibition, habeas corpus, and quo warranto in the cases and in the manner prescribed in the Code of
Civil Procedure, and to hear and determine the controversies thus brought before it, and in other cases
provided by law." Jurisdiction to issue writs of quo warranto, certiorari, mandamus, prohibition, and
habeas corpus was also conferred on the Courts of First Instance by the Code of Civil Procedure. (Act No.
190, secs. 197, 217, 222, 226, and 525.) It results that the original jurisdiction possessed and exercised by
the Supreme Court of the Philippine Islands at the time of the adoption of the Constitution was not
exclusive of, but concurrent with, that of the Courts of First Instance. Inasmuch as this is the same
original jurisdiction vested in this court by the Constitution and made to include all cases affecting
ambassadors, other public ministers, and consuls, it follows that the jurisdiction of this court over such
cases is not exclusive.

The conclusion we have reached upon this branch of the case finds support in the pertinent decisions of
the Supreme Court of the United States. The Constitution of the United States provides that the Supreme
Court shall have "original jurisdiction" in all cases affecting ambassadors, other public ministers, and
consuls. In construing this constitutional provision, the Supreme Court of the United States held that the
"original jurisdiction thus conferred upon the Supreme Court by the Constitution was not exclusive
jurisdiction, and that such grant of original jurisdiction did not prevent Congress from conferring original
jurisdiction in cases affecting consuls on the subordinate courts of the Union. (U. S. vs. Ravara, supra;
Bors vs. Preston, 111 U. S., 252; 28 Law. ed., 419.)

3. The laws in force in the Philippines prior to the inauguration of the Commonwealth conferred upon the
Courts of the First Instance original jurisdiction in all criminal cases to which a penalty of more than six
months' imprisonment or a fine exceeding one hundred dollars might be imposed. (Act No. 136, sec. 56.)
Such jurisdiction included the trial of criminal actions brought against consuls for, as we have already
indicated, consuls, not being entitled to the privileges and immunities of ambassadors or ministers, are
subject to the laws and regulations of the country where they reside. By Article XV, section 2, of the
Constitution, all laws of the Philippine Islands in force at the time of the adoption of the Constitution
were to continue in force until the inauguration of the Commonwealth; thereafter, they were to remain
operative, unless inconsistent with the Constitution until amended, altered, modified, or repealed by the
National Assembly. The original jurisdiction granted to the Courts of First Instance to try criminal cases
was not made exclusively by any, law in force prior to the inauguration of the Commonwealth, and
having reached the conclusion that the jurisdiction conferred upon this court by the Constitution over
cases affecting ambassadors, other public ministers, and consuls, is not an exclusive jurisdiction, the laws
in force at the time of the adoption of the Constitution, granting the Courts of First Instance jurisdiction in
such cases, are not inconsistent with the Constitution, and must be deemed to remain operative and in
force, subject to the power of the National Assembly to amend alter, modify, or repeal the same. (Asiatic
P. Co. vs. Insular Collector of Customs, U. S. Supreme Court [Law. ed.], Adv. Ops., vol. 80, No. 12, pp.
620, 623.)

We conclude, therefore, that the Court of First Instance of Manila has jurisdiction to try the petitioner, an
that the petition for a writ of prohibition must be denied. So ordered.

Republic of the Philippines

SUPREME COURT
Manila

THIRD DIVISION

G.R. Nos. 97468-70 September 2, 1993

SOUTHEAST ASIAN FISHERIES DEVELOPMENT CENTER represented by its Chief, DR. FLOR J.
LACANILAO, petitioner,
vs.
DANILO ACOSTA in his capacity as Labor Arbiter of the National Labor Relations Commission,
Regional Arbitration, Branch VI, CORAZON CANTO, DAN BALIAO, ELIZABETH SUPETRAN,
CARMELITA FERRER, CATHRYN CONTRADOR, and DORIC VELOSO, respondents.

This is an original petition for certiorari and prohibition, with a prayer for the issuance of a restraining
order, to set aside the order of respondent labor arbiter, dated 20 September 1990, denying herein
petitioner's motion to dismiss the cases subject matter of the petition for lack of jurisdiction.

Two labor cases, docketed as RAB Case No. VI- 0156-86 and RAB case No. VI - 0214-86, were filed by
the herein private respondents against the petitioner, Southeast Asian Fisheries Development Center
(SEAFDEC), before the National Labor Relations Commission (NLRC), Regional Arbitration Branch,
Iloilo City. In these cases, the private respondents claim having been wrongfully terminated from their
employment by the petitioner.

On 22 August 1990, the petitioner, contending to be an international inter-government organization,

composed of various Southeast Asian countries, filed a Motion to Dismiss, challenging the jurisdiction of
the public respondent in taking cognizance of the above cases.
On 20 September 1990, the public respondent issued the assailed order denying the Motion to Dismiss. In
due course, a Motion for Reconsideration was interposed but the same, in an order, dated 07 January
1991, was likewise denied.

Hence, the instant petition. This Court, on 20 March 1991, issued the temporary restraining order prayed
for.

The private respondents, as well as respondent labor arbiter, allege that the petitioner is not immune from
suit and assuming that if, indeed, it is an international organization, it has, however, impliedly, if not
expressly, waived its immunity by belatedly raising the issue of jurisdiction.

The Solicitor General, on his part, filed a Manifestation and Motion, which the Court granted, praying
that he be excused from filing his comment for respondent Labor Arbiter, he not being in agreement with
the latter's position on this matter.

On 30 March 1992, this Court dismissed the instant petition in a resolution which reads:

. . . Considering the allegations, issues and arguments adduced in the petition for certiorari as well as
the separate comments thereon of the public and private respondents, and the consolidated reply thereto
of the petitioner, the Court RESOLVED to dismiss the petition for failure to sufficiently show that the
questioned judgment is tainted with grave abuse of discretion. The temporary restraining order issued on
March 20, 1991 is hereby LIFTED effective immediately.

In time, the petitioner moved for a reconsideration, arguing that the ground for its seeking the allowance
of the petition is the labor arbiter's lack of jurisdiction over the dispute.

The court is now asked to rule upon the motion for reconsideration.

We rule for the petitioner.

It is beyond question that petitioner SEAFDEC is an international agency enjoying diplomatic immunity.
This, we have already held in Southeast Asian Fisheries Development Center-Aquaculture Department vs.
National Labor Relations Commission, G.R. No. 86773, 206 SCRA 283/1992; see also Lacanilao v. de
Leon, G.R. No. 76532, 147 SCRA, 286/1987/, where we
said

Petitioner Southeast Asian Fisheries Development Center-Aquaculture Department (SEAFDEC-AQD) is

an international agency beyond the jurisdiction of public respondent NLRC.

It was established by the Governments of Burma, Kingdom of Cambodia, Republic of Indonesia, Japan,
Kingdom of Laos, Malaysia, Republic of the Philippines, Republic of Singapore, Kingdom of Thailand
and Republic of Vietnam . . . .

The Republic of the Philippines became a signatory to the Agreement establishing SEAFDEC on January
16, 1968. Its purpose is as follows:

The purpose of the Center is to contribute to the promotion of the fisheries development in Southeast Asia
by mutual co-operation among the member governments of the Center, hereinafter called the 'Members',
and through collaboration with international organizations and governments external to the Center.

(Agreement Establishing the SEAFDEC, Art. 1; . . .).

SEAFDEC-AQD was organized during the Sixth Council Meeting of SEAFDEC on July 3-7, 1973 in
Kuala Lumpur, Malaysia as one of the principal departments of SEAFDEC. . . . to be established in Iloilo
for the promotion of research in aquaculture. Paragraph 1, Article 6 of the Agreement establishing
mandates:

1. The Council shall be the supreme organ of the Center and all powers of the Center shall be vested in
the Council.

Being an intergovernmental organization, SEAFDEC including its Departments (AQD), enjoys functional
independence and freedom from control of the state in whose territory its office is located.

As Senator Jovito R. Salonga and Former Chief Justice Pedro L. Yap stated in their book, Public
International Law (p. 83,1956 ed.):

Permanent international commissions and administrative bodies have been created by the agreement of a
considerable number of States for a variety of international purposes, economic or social and mainly non-
political. Among the notable instances are the International Labor Organization, the International Institute
of Agriculture, the International Danube Commission. In so far as they are autonomous and beyond the
control of any one State, they have a distinct juridical personality independent of the municipal law of the
State where they are situated. As such, according to one leading authority they must be deemed to possess
a species of international personality of their own. (Salonga and Yap, Public International Law, 83 [1956
ed.]

Pursuant to its being a signatory to the Agreement, the Republic of the Philippines agreed to be
represented by one Director in governing SEAFDEC Council (Agreement Establishing SEAFDEC, Art. 5,
Par. 1,. . .), and that its national laws and regulations shall apply only insofar as its contributions to
SEAFDEC of "an agreed amount of money, movable and immovable property and services necessary for
the establishment and operation of the Center" are concerned (Art. 11, ibid). It expressly waived the
application of the Philippine laws on the disbursement of funds of petitioner SEAFDEC-AQD (Section 2,
P.D. No. 292).

The then Minister of Justice likewise opined that Philippine Courts have no jurisdiction over SEAFDEC-
AQD in Opinion No. 139, Series of 1984

4. One of the basic immunities of an international organization is immunity from local jurisdiction, i.e.,
that it is immune from the legal writs and processes issued by the tribunals of the country where it is
found. (See Jenks, Id., pp. 37-44). The obvious reason for this is that the subjection of such an
organization to the authority of the local courts would afford a convenient medium thru which the host
government may interfere in their operations or even influence or control its policies and decisions of the
organization; besides, such objection to local jurisdiction would impair the capacity of such body to
discharge its responsibilities impartially on behalf of its member-states. In the case at bar, for instance, the
entertainment by the National Labor Relations Commission of Mr. Madamba's reinstatement cases would
amount to interference by the Philippine Government in the management decisions of the SEARCA
governing board; even worse, it could compromise the desired impartiality of the organization since it
will have to suit its actuations to the requirements of Philippine law, which may not necessarily coincide
with the interests of the other member-states. It is precisely to forestall these possibilities that in cases
where the extent of the immunity is specified in the enabling instruments of international organizations
(jurisdictional immunity, is specified in the enabling instruments of international organizations),
jurisdictional immunity from the host country is invariably among the first accorded. (See Jenks, Id.; See
Bowett. The Law of International Institutions. pp. 284-285).

At its Sixth Meeting held at Kuala Lumpur, Malaysia, on 3 to 7 July 1973, the SEAFDEC Council
approved the formal establishment of its Aquaculture Department in the province of Iloilo, Philippines, to
promote research in Aquaculture as so expressed in the "Whereas" Clauses of Presidential Decree No. 292
issued on 13 September 1973 1. Furthermore, Section 2 of the same decree had provided for the
autonomous character of SEAFDEC, thus:

. . . .All funds received by the Department shall be receipted and disbursed in accordance with the
Agreement establishing the Southeast Asian Fisheries Development Center and pertinent resolutions duly
approved by the SEAFDEC Council.

As aptly pointed out by Associate Justice Isagani Cruz of this Court

Certain administrative bodies created by agreement among states may be vested with international
personality when two conditions concur, to wit:, that their purposes are mainly non-political and that they
are autonomous, i.e., not subject to the control of any state. 2

Anent the issue of waiver of immunity, suffice it to say at the moment that the petitioner has timely raised
the issue of jurisdiction. While the petitioner did not question the public respondent's lack of jurisdiction
at the early stages of the proceedings, it, nevertheless, did so before it rested its case and certainly well
before the proceedings thereat had terminated.

WHEREFORE, our resolution, dated 30 March 1992, dismissing the petition for certiorari, is hereby
reconsidered, and another is entered (a) granting due course to the petition; (b) setting aside the order,
dated 20 September 1990, of the public respondent; and (c) enjoining the public respondent from further
proceeding with RAB Case No. VI-0156-86 and RAB Case No. VI-0214-86. No costs.

SO ORDERED.

R E P U B L I C V I Y O Y ( C AS E D I G E S T )
September 18, 2014
 Facts:

1. On 25 March 1997, Respondent Crasus Iyoy filed a complaint in the

RTC for the nullity of marriage with his wife Fely, on the ground that
after the celebration of their marriage, he found his wife hot-tempered,
nagger and extravagant.
2. Then in 1984, Fely left the PH for the US leaving all their five
children to Crasus. After a year, she sent a letter to respondent re
seeking divorce but the latter disregarded the request.
3. In 1985, respondent learned that Fely got married to an American.
4. In 1987, Fely went back to the PH with her new husband;
respondent did not bother to talk to her because hes afraid that he
might not bear the pain and sadness.
5. At the time the complaint was filed, it has been 13years since Fely
left and abandoned respondent and there was no more possibility of
reconciliation between them.
6. Respondent alleged that Fely has psychological incapacity to
perform marital obligations set forth in the FC.
7. In 1997, Fely refuted all the allegation about her, instead, argued
that her hot temperance was due to her husbands drunkenness,
womanizing, and lack of sincere effort to find employment, hence, the
reason why she left the country was for financial reasons.
8. She further invokes that although she left, she continued to give
support to her children. She also explained that after the divorce, she
was naturalized as an American Citizen, hence, her status re marriage is
governed by her present nationality.
9. After both parties filed their respective pre-trial briefs, the RTC gave
them opportunity to present evidence.
10. On 30 October 1998, the RTC promulgated its Judgment declaring
the marriage of respondent and Fely null and void ab initio due to Felys
psychological incapacity to comply with her marital duties such as
striving for unity, observing fidelity, mutual love, respect, help and
support. Crasus also adequately established that the defendant
practically abandoned him; and that his wife committed bigamous
marriage.
11. Petitioner Republic assailed the RTCs decision saying that it was
contrary to law and evidence, hence, filed an appeal to the CA but the
appellate court affirmed the earlier decision of the RTC citing article 26
of the FC saying that to condemn plaintiff to remain shackle in a
marriage that in truth and in fact does not exist and to remain married
to a spouse who is incapacitated to discharge essential marital
covenants is verily to condemn him to a perpetual disadvantage which
this Court finds abhorrent.
12. With such, Petitioner Republic seek an appeal in the SC on the
ground that abandonment by and sexual infidelity of respondents wife
do not per se constitute psychological incapacity.
RULING:

1. What constitute a psychological incapacity?

1. Citing Santos v CA, the Court stated that psychological
incapacity refers to no less than a mental incapacity that causes a
party to be truly cognitive of the basic marital covenants that
concomitantly must be assumed and discharged by the parties to the
marriage.
2. The only evidence presented by Crasus was his testimony which is
put in question for being self-serving. The evidence is not enough to
convince the Court that Fely had such grave mental illness that
prevented her from assuming the essential obligations of marriage.
3. It is worthy to emphasize that Art 36 contemplates downright
incapacity or inability to take cognizance of and to assume basic marital
obligations; not a mere refusal, neglect or difficulty, much less, ill will,
on the part of the errant spouse.
The evidence may have proven that Fely committed acts that hurt and
embarrassed respondent and the rest of the family. Her hot-temper,
nagging, and extravagance; her abandonment of respondent; her
marriage to an Am citizen; and even her flaunting of her American family
may be indeed manifestations of her alleged incapacity, nonetheless, the
root cause for such was not identified. If the root cause f the incapacity
was not identified, then, it cannot be satisfactorily established as a
psychological

VAN DORN VS. ROMILLO AND UPTON

MARCH 28, 2013 ~ VBDIAZ

VAN DORN vs. HON. ROMILLO and RICHARD UPTON

G.R. No. L-68470

October 8, 1985
FACTS: Petitioner Alice Van Dorn is a citizen of the Philippines while
private respondent Richard Upton is a citizen of the USA. They were
married in Hongkong in 1972 and begot two children. The parties were
divorced in Nevada, USA in 1982. Alice has then re-married also in
Nevada, this time to Theodore Van Dorn.

In 1983, Richard filed suit against Alice in the RTC-Pasay, stating that
Alices business in Ermita, Manila is conjugal property of the parties, and
asking that Alice be ordered to render an accounting of that business, and
that Richard be declared with right to manage the conjugal property.

Alice moved to dismiss the case on the ground that the cause of action is
barred by previous judgment in the divorce proceedings before the
Nevada Court wherein respondent had acknowledged that he and
petitioner had no community property as of June 11, 1982.

The Court below (presiding judge: Judge Romillo) denied the MTD in the
mentioned case on the ground that the property involved is located in the
Philippines so that the Divorce Decree has no bearing in the case. The
denial is now the subject of this certiorari proceeding.

ISSUE: What is the effect of the foreign divorce on the parties and their
alleged conjugal property in the Philippines?

HELD: Petition is granted, and respondent Judge is hereby ordered to

dismiss the Complaint

For the resolution of this case, it is not necessary to determine whether

the property relations between Alice and Richard, after their marriage,
were upon absolute or relative community property, upon complete
separation of property, or upon any other regime. The pivotal fact in this
case is the Nevada divorce of the parties.

The Nevada District Court, which decreed the divorce, had obtained
jurisdiction over petitioner who appeared in person before the Court
during the trial of the case. It also obtained jurisdiction over private
respondent who authorized his attorneys in the divorce case to agree to
the divorce on the ground of incompatibility in the understanding that
there were neither community property nor community obligations.

As explicitly stated in the Power of Attorney he executed in favor of the

law firm of KARP & GRAD LTD. to represent him in the divorce
proceedings:

xxx xxx xxx

You are hereby authorized to accept service of Summons, to file an

Answer, appear on my behalf and do all things necessary and proper to
represent me, without further contesting, subject to the following:

1. That my spouse seeks a divorce on the ground of incompatibility.

2. That there is no community of property to be adjudicated by the Court.

3. That there are no community obligations to be adjudicated by the

court.

xxx xxx xxx

There can be no question as to the validity of that Nevada divorce in any

of the States of the United States. The decree is binding on private
respondent as an American citizen. What he is contending in this case is
that the divorce is not valid and binding in this jurisdiction, the same
being contrary to local law and public policy.

It is true that owing to the nationality principle embodied in Article 15 of

the Civil Code, only Philippine nationals are covered by the policy against
absolute divorces the same being considered contrary to our concept of
public police and morality. However, aliens may obtain divorces abroad,
which may be recognized in the Philippines, provided they are valid
according to their national law. In this case, the divorce in Nevada
released private respondent from the marriage from the standards of
American law, under which divorce dissolves the marriage.

Thus, pursuant to his national law, private respondent is no longer the

husband of petitioner. He would have no standing to sue in the case
below as petitioners husband entitled to exercise control over conjugal
assets. As he is bound by the Decision of his own countrys Court, which
validly exercised jurisdiction over him, and whose decision he does not
repudiate, he is estopped by his own representation before said Court
from asserting his right over the alleged conjugal property.

TITLE: Grace J. Garcia-Recio v Rederick A. Recio

CITATION: GR NO. 138322, Oct. 2, 2002 | 366 SCRA 437

FACTS:

Rederick A. Recio, a Filipino, was married to Editha Samson, an Australian

Citizen, in Malabon, Rizal on March 1, 1987. They lived as husband and
wife in Australia. However, an Australian family court issued purportedly
a decree of divorce, dissolving the marriage of Rederick and Editha on
May 18, 1989.

On January 12, 1994, Rederick married Grace J. Garcia where it was

solemnized at Our lady of Perpetual Help Church, Cabanatuan City. Since
October 22, 1995, the couple lived separately without prior judicial
dissolution of their marriage. As a matter of fact, while they were still in
Australia, their conjugal assets were divided on May 16, 1996, in
accordance with their Statutory Declarations secured in Australia.
Grace filed a Complaint for Declaration of Nullity of Marriage on the
ground of bigamy on March 3, 1998, claiming that she learned only in
November 1997, Redericks marriage with Editha Samson.

ISSUE: Whether the decree of divorce submitted by Rederick Recio is

admissible as evidence to prove his legal capacity to marry petitioner and
absolved him of bigamy.

HELD:

The nullity of Redericks marriage with Editha as shown by the divorce

decree issued was valid and recognized in the Philippines since the
respondent is a naturalized Australian. However, there is absolutely no
evidence that proves respondents legal capacity to marry petitioner
though the former presented a divorce decree. The said decree, being a
foreign document was inadmissible to court as evidence primarily
because it was not authenticated by the consul/ embassy of the country
where it will be used.

Under Sections 24 and 25 of Rule 132, a writing or document may be

proven as a public or official record of a foreign country by either:

(1) an official publication or

(2) a copy thereof attested by the officer having legal custody of the
document. If the record is not kept in the Philippines, such copy must be:

(a) accompanied by a certificate issued by the proper diplomatic or

consular officer in the Philippine foreign service stationed in the foreign
country in which the record is kept and

(b) authenticated by the seal of his office.

Thus, the Supreme Court remands the case to the Regional Trial Court of
Cabanatuan City to receive or trial evidence that will conclusively prove
respondents legal capacity to marry petitioner and thus free him on the
ground of bigamy.

LLORENTE vs. CA, G.R. No. 124371. November 23, 2000

PAULA T. LLORENTE, petitioner, VS. COURT OF APPEALS and

ALICIA F. LLORENTE,

November 23, 2000

FACTS:

Lorenzo Llorente and petitioner Paula Llorente were married in 1937 in the
Philippines. Lorenzo was an enlisted serviceman of the US Navy. Soon
after, he left for the US where through naturalization, he became a US
Citizen. Upon his visitation of his wife, he discovered that she was living
with his brother and a child was born. The child was registered as
legitimate but the name of the father was left blank. Llorente filed a
divorce in California, which later on became final. He married Alicia and
they lived together for 25 years bringing 3 children. He made his last will
and testament stating that all his properties will be given to his second
marriage. He filed a petition of probate that made or appointed Alicia his
special administrator of his estate. Before the

proceeding could be terminated, Lorenzo died. Paula filed a letter of

administration over Llorentes estate. The trial granted the letter and
denied the motion for reconsideration. An appeal was made to the Court
of Appeals, which affirmed and modified the judgment of the Trial Court
that she be declared co-owner of whatever properties, she and the
deceased, may have acquired during their 25 years of cohabitation.

ISSUE:

Whether or not the National Law shall apply.

RULING:

Lorenzo Llorente was already an American citizen when he divorced Paula.

Such was also the situation when he married Alicia and executed his will.
As stated in Article 15 of the civil code, aliens may obtain divorces
abroad, provided that they are validly required in their National Law. Thus
the divorce obtained by Llorente is valid because the law that governs
him is not Philippine Law but his National Law since the divorce was
contracted after he became an American citizen. Furthermore, his
National Law allowed divorce.

The case was remanded to the court of origin for determination of the
intrinsic validity of Lorenzo Llorentes will and determination of the
parties successional rights allowing proof of foreign law.

Republic vs. Orbecido

GR NO. 154380, October 5, 2005

FACTS:

Cipriano Orbecido III was married with Lady Myros Villanueva on May 24,
1981 at the United Church of Christ in the Philippines in Ozamis City.
They had a son and a daughter named Kristoffer and Kimberly,
respectively. In 1986, the wife left for US bringing along their son
Kristoffer. A few years later, Orbecido discovered that his wife had been
naturalized as an American citizen and learned from his son that his wife
sometime in 2000 had obtained a divorce decree and married a certain
Stanley. He thereafter filed with the trial court a petition for authority to
remarry invoking Paragraph 2 of Article 26 of the Family Code.

ISSUE: Whether or not Orbecido can remarry under Article 26 of the

Family Code.

HELD:

The court ruled that taking into consideration the legislative intent and
applying the rule of reason, Article 26 Par.2 should be interpreted to
include cases involving parties who, at the time of the celebration of the
marriage were Filipino citizens, but later on, one of them becomes
naturalized as a foreign citizen and obtains a divorce decree. The Filipino
spouse should likewise be allowed to remarry as if the other party were a
foreigner at the time of the solemnization of the marriage.

Hence, the courts unanimous decision in holding Article 26 Par 2 be

interpreted as allowing a Filipino citizen who has been divorced by a
spouse who had acquired a citizenship and remarried, also to remarry
under Philippine law.

G.R. No. L-23678 (June 6, 1967)

Bellis vs. Bellis

FACTS:

Amos G. Bellis was a citizen of the State of Texas and of the United States. He had five legitimate
children with his first wife (whom he divorced), three legitimate children with his second wife (who
survived him) and, finally, three illegitimate children.
6 years prior Amos Bellis death, he executed two(2) wills, apportioning the remainder of his estate and
properties to his seven surviving children. The appellants filed their oppositions to the project of partition
claiming that they have been deprived of their legitimes to which they were entitled according to the
Philippine law. Appellants argued that the deceased wanted his Philippine estate to be governed by the
Philippine law, thus the creation of two separate wills.

ISSUE:

Whether or not the Philippine law be applied in the case in the determination of the illegitimate childrens
successional rights

RULING:

Court ruled that provision in a foreigners will to the effect that his properties shall be distributed in
accordance with Philippine law and not with his national law, is illegal and void, for his national law
cannot be ignored in view of those matters that Article 10 now Article 16 of the Civil Code states
said national law should govern.
Where the testator was a citizen of Texas and domiciled in Texas, the intrinsic validity of his will should
be governed by his national law. Since Texas law does not require legitimes, then his will, which deprived
his illegitimate children of the legitimes, is valid.
The Supreme Court held that the illegitimate children are not entitled to the legitimes under the texas law,
which is the national law of the deceased.

AZNAR VS GARCIA
MARCH 28, 2013 ~ VBDIAZ
AZNAR vs. GARCIA
 G.R. No. L-16749
January 31, 1963
FACTS: EDWARD Christensen died testate. The estate was distributed by Executioner Aznar according
to the will, which provides that: Php 3,600 be given to HELEN Christensen as her legacy, and the rest of
his estate to his daughter LUCY Christensen, as pronounced by CFI Davao.

Opposition to the approval of the project of partition was filed by Helen, insofar as it deprives her of her
legitime as an acknowledged natural child, she having been declared by Us an acknowledged natural
child of the deceased Edward in an earlier case.

As to his citizenship, we find that the citizenship that he acquired in California when he resided in
Sacramento from 1904 to 1913, was never lost by his stay in the Philippines, and the deceased appears to
have considered himself as a citizen of California by the fact that when he executed his will he declared
that he was a citizen of that State; so that he appears never to have intended to abandon his California
citizenship by acquiring another. But at the time of his death, he was domiciled in the Philippines.

ISSUE: what law on succession should apply, the Philippine law or the California law?

HELD: WHEREFORE, the decision appealed from is hereby reversed and the case returned to the lower
court with instructions that the partition be made as the Philippine law on succession provides.

The law that governs the validity of his testamentary dispositions is defined in Article 16 of the Civil
Code of the Philippines, which is as follows:

ART. 16. Real property as well as personal property is subject to the law of the country where it is
situated.

However, intestate and testamentary successions, both with respect to the order of succession and to the
amount of successional rights and to the intrinsic validity of testamentary provisions, shall be regulated
by the national law of the person whose succession is under consideration, whatever may be the nature of
the property and regardless of the country where said property may be found.

The application of this article in the case at bar requires the determination of the meaning of the term
national law is used therein.

The next question is: What is the law in California governing the disposition of personal property?
The decision of CFI Davao, sustains the contention of the executor-appellee that under the California
Probate Code, a testator may dispose of his property by will in the form and manner he desires. But
HELEN invokes the provisions of Article 946 of the Civil Code of California, which is as follows:

If there is no law to the contrary, in the place where personal property is situated, it is deemed to follow
the person of its owner, and is governed by the law of his domicile.

It is argued on executors behalf that as the deceased Christensen was a citizen of the State of California,
the internal law thereof, which is that given in the Kaufman case, should govern the determination of the
validity of the testamentary provisions of Christensens will, such law being in force in the State of
California of which Christensen was a citizen. Appellant, on the other hand, insists that Article 946 should
be applicable, and in accordance therewith and following the doctrine of the renvoi, the question of the
validity of the testamentary provision in question should be referred back to the law of the decedents
domicile, which is the Philippines.

We note that Article 946 of the California Civil Code is its conflict of laws rule, while the rule applied in
In re Kaufman, its internal law. If the law on succ ession and the conflict of laws rules of California are to
be enforced jointly, each in its own intended and appropriate sphere, the principle cited In re Kaufman
should apply to citizens living in the State, but Article 946 should apply to such of its citizens as are not
domiciled in California but in other jurisdictions. The rule laid down of resorting to the law of the
domicile in the determination of matters with foreign element involved is in accord with the general
principle of American law that the domiciliary law should govern in most matters or rights which follow
the person of the owner.

Appellees argue that what Article 16 of the Civil Code of the Philippines pointed out as the national law is
the internal law of California. But as above explained the laws of California have prescribed two sets of
laws for its citizens, one for residents therein and another for those domiciled in other jurisdictions.
It is argued on appellees (Aznar and LUCY) behalf that the clause if there is no law to the contrary in
the place where the property is situated in Sec. 946 of the California Civil Code refers to Article 16 of
the Civil Code of the Philippines and that the law to the contrary in the Philippines is the provision in said
Article 16 that the national law of the deceased should govern. This contention can not be sustained.

As explained in the various authorities cited above, the national law mentioned in Article 16 of our Civil
Code is the law on conflict of laws in the California Civil Code, i.e., Article 946, which authorizes the
reference or return of the question to the law of the testators domicile. The conflict of laws rule in
California, Article 946, Civil Code, precisely refers back the case, when a decedent is not domiciled in
California, to the law of his domicile, the Philippines in the case at bar. The court of the domicile can not
and should not refer the case back to California; such action would leave the issue incapable of
determination because the case will then be like a football, tossed back and forth between the two states,
between the country of which the decedent was a citizen and the country of his domicile. The Philippine
court must apply its own law as directed in the conflict of laws rule of the state of the decedent, if the
question has to be decided, especially as the application of the internal law of California provides no
legitime for children while the Philippine law, Arts. 887(4) and 894, Civil Code of the Philippines, makes
natural children legally acknowledged forced heirs of the parent recognizing them.

We therefore find that as the domicile of the deceased Edward, a citizen of California, is the Philippines,
the validity of the provisions of his will depriving his acknowledged natural child, the appellant HELEN,
should be governed by the Philippine Law, the domicile, pursuant to Art. 946 of the Civil Code of
California, not by the internal law of California..

NOTES: There is no single American law governing the validity of testamentary provisions in the United
States, each state of the Union having its own private law applicable to its citizens only and in force only
within the state. The national law indicated in Article 16 of the Civil Code above quoted can not,
therefore, possibly mean or apply to any general American law. So it can refer to no other than the private
law of the State of California

Miciano vs Brimo
TITLE: Juan Miciano v Andre Brimo
CITATION: GR No.22595, November 1, 1927| 50 Phil 867

FACTS:

Juan Miciano, judicial administrator of the estate in question, filed a scheme of partition. Andre Brimo,
one of the brothers of the deceased (Joseph Brimo) opposed Micianos participation in the inheritance.
Joseph Brimo is a Turkish citizen.

ISSUE: Whether Turkish law or Philippine law will be the basis on the distribution of Joseph Brimos
estates.

HELD:

Though the last part of the second clause of the will expressly said that it be made and disposed of in
accordance with the laws in force in the Philippine Island, this condition, described as impossible
conditions, shall be considered as not imposed and shall not prejudice the heir or legatee in any manner
whatsoever, even should the testator otherwise provide. Impossible conditions are further defined as
those contrary to law or good morals. Thus, national law of the testator shall govern in his testamentary
dispositions.
The court approved the scheme of partition submitted by the judicial administrator, in such manner as to
include Andre Brimo, as one of the legatees.

LLORENTE vs. CA, G.R. No. 124371. November 23, 2000

PAULA T. LLORENTE, petitioner, VS. COURT OF APPEALS and ALICIA
F. LLORENTE,
November 23, 2000

FACTS:
Lorenzo Llorente and petitioner Paula Llorente were married in 1937 in the Philippines. Lorenzo was an
enlisted serviceman of the US Navy. Soon after, he left for the US where through naturalization, he
became a US Citizen. Upon his visitation of his wife, he discovered that she was living with his brother
and a child was born. The child was registered as legitimate but the name of the father was left blank.
Llorente filed a divorce in California, which later on became final. He married Alicia and they lived
together for 25 years bringing 3 children. He made his last will and testament stating that all his properties
will be given to his second marriage. He filed a petition of probate that made or appointed Alicia his
special administrator of his estate. Before the
proceeding could be terminated, Lorenzo died. Paula filed a letter of administration over Llorentes estate.
The trial granted the letter and denied the motion for reconsideration. An appeal was made to the Court of
Appeals, which affirmed and modified the judgment of the Trial Court that she be declared co-owner of
whatever properties, she and the deceased, may have acquired during their 25 years of cohabitation.

ISSUE:
Whether or not the National Law shall apply.

RULING:
Lorenzo Llorente was already an American citizen when he divorced Paula. Such was also the situation
when he married Alicia and executed his will. As stated in Article 15 of the civil code, aliens may obtain
divorces abroad, provided that they are validly required in their National Law. Thus the divorce obtained
by Llorente is valid because the law that governs him is not Philippine Law but his National Law since
the divorce was contracted after he became an American citizen. Furthermore, his National Law allowed
divorce.
The case was remanded to the court of origin for determination of the intrinsic validity of Lorenzo
Llorentes will and determination of the parties successional rights allowing proof of foreign law.
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GARCIA vs. RECIO G.R. No. 138322. October 2, 2001

REPUBLIC OF THE PHILIPPINES vs CIPRIANO ORBECIDO III, G. R. No. 154380 October 5, 2005
UNIVERSITY OF THE EAST vs. ROMEO A. JADER, GR No. 132344. February 17, 2000.
Suntay vs. Suntay GR No. 132524 December 29, 1998

HUMAN RELATIONS ARTICLES 19-35

University of the East vs Jader

TITLE: University of the East vs. Jader
CITATION: GR No. 132344, February 7, 2000

FACTS:

Romeo Jader graduated at UE College of law from 1984-88. During his last year, 1st semester, he failed
to take the regular final examination in Practical Court 1where he was given an incomplete grade
remarks. He filed an application for removal of the incomplete grade given by Prof. Carlos Ortega on
February 1, 1988 which was approved by Dean Celedonio Tiongson after the payment of required fees.
He took the exam on March 28 and on May 30, the professor gave him a grade of 5.

The commencement exercise of UE College of law was held April 16, 1988, 3PM. In the invitation, his
name appeared. In preparation for the bar exam, he took a leave of absence from work from April 20-
Sept 30, 1988. He had his pre-bar class review in FEU. Upon learning of such deficiency, he dropped his
review classes and was not able to take the bar exam.

Jader sued UE for damages resulting to moral shock, mental anguish, serious anxiety, besmirched
reputation, wounded feelings, sleepless nights due to UEs negligence.

ISSUE: Whether UE should be held liable for misleading a student into believing JADER satisfied all the
requirements for graduation when such is not the case. Can he claim moral damages?

HELD:
SC held that petitioner was guilty of negligence and this liable to respondent for the latters actual
damages. Educational institutions are duty-bound to inform the students of their academic status and not
wait for the latter to inquire from the former. However, respondent should not have been awarded moral
damages though JADER suffered shock, trauma, and pain when he was informed that he could not
graduate and will not be allowed to take the bar examinations as what CA held because its also
respondents duty to verify for himself whether he has completed all necessary requirements to be eligible
for the bar examinations. As a senior law student, he should have been responsible in ensuring that all his
affairs specifically those in relation with his academic achievement are in order. Before taking the bar
examinations, it doesnt only entail a mental preparation on the subjects but there are other prerequisites
such as documentation and submission of requirements which prospective examinee must meet.

WHEREFORE, the assailed decision of the Court of Appeals is AFFIRMED with MODIFICATION.
Petitioner is ORDERED to PAY respondent the sum of Thirty-five Thousand Four Hundred Seventy
Pesos (P35,470.00), with legal interest of 6% per annum computed from the date of filing of the
complaint until fully paid; the amount of Five Thousand Pesos (P5,000.00) as attorney's fees; and the
costs of the suit. The award of moral damages is DELETED.

Globe Mackay vs.CA 176 SCRA 778

GLOBE MACKAY CABLE AND RADIO CORP., and HERBERT C. HENDRY,
petitioners vs. THE HONORABLE COURT OF APPEALS and RESTITUTO M. TOBIAS,
respondents.

FACTS: Private respondent Restituto M. Tobias was employed by petitioner Globe Mackay in dual
capacity as purchasing agent and administrative assistant to the engineering operations manager. In 1972,
the respondent discovered fraudulent anomalies and transactions in the said corporation for which it lost
several hundred thousands of pesos. The private respondent reported to his superiors including Henry, the
petitioner. However, he was confronted by Hendry stating that Tobias was the number one suspect. He
was ordered to take a one week forced leave. When he returned to work, Hendry called him crook and
swindler, and left a scornful remark to the Filipinos. The petitioners also charged six criminal cases
against the respondentfive cases of estafa and one for violating Article 290 of the RPC (Discovering
Secrets through Seizure of Correspondence). The petitioner also sent a poison letter to RETELCO causing
the respondent to be unemployed.

ISSUE: Whether or not the petitioners are liable for damages to the respondent.

HELD: Petitioners invoked the right of damnun absque injuria or the damage or loss which does not
constitute a violation of legal right or amount to a legal wrong is not actionable. However, this is not
applicable in this case. It bears repeating that even granting that petitioners might have had the right to
dismiss Tobias from work, the abusive manner in which that right was exercised amounted to a legal
wrong for which petitioners must be held liable.

The court awarded Tobias the following: Php 80, 000 as actual damages, Php 200, 000 as moral damages,
Php 20, 0000 as exemplary damages; Php 30, 000 as attorneys fees; and, costs. Petition was denied and
the decision of CA is AFFIRMED.

[G.R. No. 159590. April 25, 2005]

HSBC vs. CATALAN
SECOND DIVISION
Sirs/Mesdames:

Quoted hereunder, for your information, is a resolution of this Court dated APR 25 2005.

G.R. No. 159590 (Hongkong and Shanghai Banking Corporation Limited vs. Cecilia Diez Catalan) and
G.R. No. 159591 (HSBC International Trustee Limited vs. Cecilia Diez Catalan.)

RESOLUTION

Catalan filed a complaint against HSBANK and HSBC Trustee for sum of money and damages for
wanton refusal to pay the value of checks issued in her favor by Thomson. She anchored her cause of
action on Article 19 of the Civil Code, the abuse of rights principle. HSBANK alleged that Catalan has no
cause of action for abuse of rights. HSBC Trustee alleged that the case should be dismissed against it for
improper service of summons.

In a Decision dated October 18, 2004, we held that Catalan has a cause of action against HSBANK and
HSBC Trustee for abuse of rights but dismissed the case against HSBC Trustee for improper service of
summons.

HSBANK and Catalan filed separate motions for partial reconsideration.

HSBANK prays for a fresh second look of the case because the allegations of the complaint and annexes
thereto do not show that HSBANK committed any abuse in refusing to honor the subject checks. It argues
that, as may be deciphered from copies of the checks attached in the complaint, the checks were deposited
after Thomson was already dead. It adds that another reason for HSBANK to be wary in honoring the
checks is that in a previous communication, Thomson admitted having previously issued checks to
Catalan without his full signature and in which correction fluid was used. It insists that HSBANK acted
with prudence and in good faith in returning the checks pending confirmation in view of its failure to
communicate with Thomson by phone to verify if indeed he issued the checks and the signatures are
genuine. It submits that in the absence of any allegations on abuse of right, the complaint against
HSBANK is an ordinary action to compel the bank, as drawee, to honor the checks, which she cannot
pursue because HSBANK did not accept the check. Under Sec. 147 of the Negotiable Instruments Law,
the drawee is not liable unless and until he accepts the check.

On the other hand, Catalan seeks a reversal of the decision insofar as it declared the lower court without
jurisdiction over HSBC Trustee because of improper service of summons. She claims that HSBC Trustee
effectively waived the improper service of summons when on June 9, 2004 and August 11, 2004 it
conducted its cross examination on Catalan.

In compliance with a resolution of the Court dated January 19, 2005, the parties filed their respective
comments to each party's motion for partial reconsideration.

Anent HSBANK'S motion for partial reconsideration, we adequately addressed and resolved its
arguments in our decision. We reiterate that in determining whether a complaint fails to state a cause of
action, only the allegations therein may be properly considered.[1]cralaw Moreover, a defendant who
moves to dismiss the complaint on this ground hypothetically admits all the averments thereof.[2]cralaw
The test of the sufficiency of the facts alleged in a complaint is whether, admitting the facts alleged, the
court may render a valid judgment upon them in accordance with the prayer of the complaint.[3]cralaw If
the allegations in the complaint furnish sufficient basis on which it can be maintained, it should not be
dismissed regardless of the defense that may be presented by the defendants.[4]cralaw If the trial court
finds the allegations to be sufficient, but doubts their veracity, it must deny the motion to dismiss and then
require the defendant to answer, and proceed to try the case on the merits.[5]cralaw In this case, assuming
the facts to be true, Catalan's complaint sufficiently establishes a cause of action. On the basis of her
allegations, the trial court may render a valid judgment. Thus, the complaint passes the test of sufficiency
of the facts alleged. The other matters raised by HSBANK cannot be determined in a motion to dismiss or
the petition before this Court. Those are purely factual issues that should be the subject of a full-dress trial
in the trial court.

With respect to Catalan's motion for partial reconsideration, we stress that only when a party participated
in the trial without objecting to the court's jurisdiction is he estopped and deemed to have effectively
waived the issue of the trial court's jurisdiction. Stated elsewise, the active participation of a party against
whom the action was brought, coupled with his failure to object to the jurisdiction of the court where the
action is pending, is tantamount to an invocation of that jurisdiction and a willingness to abide by the
resolution of the case and will bar said party from later on impugning the court or body's jurisdiction.
[6]cralaw In this case, since improper service of summons has seasonably been raised, as aptly held in
Signetics Corp. vs. Court of Appeals,[7] "there should be no real cause for what may understandably be
its apprehension, i.e., that by its participation during the trial on the merits, it may, absent an invocation of
separate or independent reliefs of its own, be considered to have voluntarily submitted itself to the court's
jurisdiction."[8]cralaw Thus, HSBC Trustee's cross-examination of Catalan cannot be deemed a waiver of
improper service of summons since it has timely raised said issue before the trial court.

WHEREFORE, the separate motions for partial reconsideration of HSBANK and Catalan are DENIED.
The denial is FINAL. No further pleadings from movants will be entertained.

SO ORDERED.

Nikko Hotel Manila Garden et al vs. Reyes G.R. No. 154259

NIKKO HOTEL MANILA GARDEN and RUBY LIM, petitioners, vs.
ROBERTO REYES a.k.a AMAY BISAYA, respondent. G.R. No. 154259,
February 28, 2005

FACTS:
This is a petition for review on certiorari of the resolution and the decision of the Court of Appeals
whereby making the petitioners liable for moral and exemplary damages.
Amay Bisaya was having a coffee at the lobby of Hotel Nikko when an old friend, Dr. Filart,
asked him to join the party of the former manager of the said hotel, Mr. Tsuruoka. When he was helping
himself at the buffet table, Ms. Lim approached him and said to leave the party for it was intended for a
number of guests. Amay Bisaya claimed that he was humiliated by the manner Ms. Lim asked him to
leave. He alleged that Ms. Lim asked him to leave in a loud voice enough to be heard by the other guests.
He was accompanied by a Makati policeman in leaving the penthouse. He was more embarrassed when
Dr. Filart denied that she invited him on the said party.

ISSUE: Whether or not the act of Ms. Lim constitutes an abuse of right to make the petitioners liable for
damages caused to Amay Bisaya.

HELD:

No. The Supreme Court ruled that any damage which Amay Bisaya might have suffered through Ms.
Lims exercise of a legitimate right done within the bounds of propriety and good faith, must be his to
bear alone.
It is unlikely to happen that Ms. Lim exposed him to ridicule and shame because admittedly,
Amay Bisaya stated that Ms. Lim was very close enough for him to kiss when she asked him to leave the
party. It was intended to be heard only by Amay Bisaya. Nevertheless , his reaction to the request must
have made the other guests aware of what transpired between them. Since Ms. Lim did not abuse her right
to ask Amay Bisaya to leave the party for being a gate-crasher, neither she nor her employer be held liable
for damages under Articles 19 and 21 of the Civil Code.
WHEREFORE, premises considered, the petition filed by Ruby Lim and Nikko Hotel Manila
Garden is GRANTED. The Decision of the Court of Appeals dated 26 November 2001 and its Resolution
dated 09 July 2002 are hereby REVERSED and SET ASIDE. The Decision of the Regional Trial Court of
Quezon City, Branch 104, dated 26 April 1999 is hereby AFFIRMED. No costs.

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 180764 January 19, 2010

TITUS B. VILLANUEVA, Petitioner,

vs.
EMMA M. ROSQUETA, Respondent.

This case is about the right to recover damages for alleged abuse of right committed by a superior public
officer in preventing a subordinate from doing her assigned task and being officially recognized for it.

The Facts and the Case

Respondent Emma M. Rosqueta (Rosqueta), formerly Deputy Commissioner of the Revenue Collection
and Monitoring Group of the Bureau of Customs (the Bureau), tendered her courtesy resignation from
that post on January 23, 2001, shortly after President Gloria Macapagal-Arroyo assumed office. But five
months later on June 5, 2001, she withdrew her resignation, claiming that she enjoyed security of tenure
and that she had resigned against her will on orders of her superior.1

Meantime, on July 13, 2001 President Arroyo appointed Gil Valera (Valera) to respondent Rosquetas
position. Challenging such appointment, Rosqueta filed a petition for prohibition, quo warranto, and
injunction against petitioner Titus B. Villanueva (Villanueva), then Commissioner of Customs, the
Secretary of Finance, and Valera with the Regional Trial Court2 (RTC) of Manila in Civil Case 01-
101539. On August 27, 2001 the RTC issued a temporary restraining order (TRO), enjoining Villanueva
and the Finance Secretary3 from implementing Valeras appointment. On August 28, 2001 the trial court
superseded the TRO with a writ of preliminary injunction.4

Petitioner Villanueva, Valera, and the Secretary of Finance challenged the injunction order before the
Court of Appeals (CA) in CA-G.R. SP 66070. On September 14, 2001 the CA issued its own TRO,
enjoining the implementation of the RTCs injunction order. But the TRO lapsed after 60 days and the CA
eventually dismissed the petition before it.
On November 22, 2001 while the preliminary injunction in the quo warranto case was again in force,
petitioner Villanueva issued Customs Memorandum Order 40-2001, authorizing Valera to exercise the
powers and functions of the Deputy Commissioner.

During the Bureaus celebration of its centennial anniversary in February 2002, its special Panorama
magazine edition featured all the customs deputy commissioners, except respondent Rosqueta. The
souvenir program, authorized by the Bureaus Steering Committee headed by petitioner Villanueva to be
issued on the occasion, had a space where Rosquetas picture was supposed to be but it instead stated that
her position was "under litigation." Meanwhile, the commemorative billboard displayed at the Bureaus
main gate included Valeras picture but not Rosquetas.

On February 28, 2002 respondent Rosqueta filed a complaint5 for damages before the RTC of Quezon
City against petitioner Villanueva in Civil Case Q-02-46256, alleging that the latter maliciously excluded
her from the centennial anniversary memorabilia. Further, she claimed that he prevented her from
performing her duties as Deputy Commissioner, withheld her salaries, and refused to act on her leave
applications. Thus, she asked the RTC to award her P1,000,000.00 in moral damages, P500,000.00 in
exemplary damages, and P300,000.00 in attorneys fees and costs of suit.

But the RTC dismissed6 respondent Rosquetas complaint, stating that petitioner Villanueva committed
no wrong and incurred no omission that entitled her to damages. The RTC found that Villanueva had
validly and legally replaced her as Deputy Commissioner seven months before the Bureaus centennial
anniversary.

But the CA reversed the RTCs decision,7 holding instead that petitioner Villanuevas refusal to comply
with the preliminary injunction order issued in the quo warranto case earned for Rosqueta the right to
recover moral damages from him.8 Citing the abuse of right principle, the RTC said that Villanueva acted
maliciously when he prevented Rosqueta from performing her duties, deprived her of salaries and leaves,
and denied her official recognition as Deputy Commissioner by excluding her from the centennial
anniversary memorabilia. Thus, the appellate court ordered Villanueva to pay P500,000.00 in moral
damages, P200,000.00 in exemplary damages and P100,000.00 in attorneys fees and litigation expenses.
With the denial of his motion for reconsideration, Villanueva filed this petition for review on certiorari
under Rule 45.

The Issue Presented

The key issue presented in this case is whether or not the CA erred in holding petitioner Villanueva liable
in damages to respondent Rosqueta for ignoring the preliminary injunction order that the RTC issued in
the quo warranto case (Civil Case 01-101539), thus denying her of the right to do her job as Deputy
Commissioner of the Bureau and to be officially recognized as such public officer.

The Courts Ruling

Under the abuse of right principle found in Article 19 of the Civil Code,9 a person must, in the exercise of
his legal right or duty, act in good faith. He would be liable if he instead acts in bad faith, with intent to
prejudice another. Complementing this principle are Articles 2010 and 2111 of the Civil Code which grant
the latter indemnity for the injury he suffers because of such abuse of right or duty.12

Petitioner Villanueva claims that he merely acted on advice of the Office of the Solicitor General (OSG)
when he allowed Valera to assume the office as Deputy Commissioner since respondent Rosqueta held the
position merely in a temporary capacity and since she lacked the Career Executive Service eligibility
required for the job.

But petitioner Villanueva cannot seek shelter in the alleged advice that the OSG gave him. Surely, a
government official of his rank must know that a preliminary injunction order issued by a court of law
had to be obeyed, especially since the question of Valeras right to replace respondent Rosqueta had not
yet been properly resolved.

That petitioner Villanueva ignored the injunction shows bad faith and intent to spite Rosqueta who
remained in the eyes of the law the Deputy Commissioner. His exclusion of her from the centennial
anniversary memorabilia was not an honest mistake by any reckoning. Indeed, he withheld her salary and
prevented her from assuming the duties of the position. As the Court said in Amonoy v. Spouses
Gutierrez,13 a partys refusal to abide by a court order enjoining him from doing an act, otherwise lawful,
constitutes an abuse and an unlawful exercise of right.1avvphi1

That respondent Rosqueta was later appointed Deputy Commissioner for another division of the Bureau is
immaterial. While such appointment, when accepted, rendered the quo warranto case moot and academic,
it did not have the effect of wiping out the injuries she suffered on account of petitioner Villanuevas
treatment of her. The damage suit is an independent action.
The CA correctly awarded moral damages to respondent Rosqueta. Such damages may be awarded when
the defendants transgression is the immediate cause of the plaintiffs anguish14 in the cases specified in
Article 221915 of the Civil Code.16

Here, respondent Rosquetas colleagues and friends testified that she suffered severe anxiety on account
of the speculation over her employment status.17 She had to endure being referred to as a "squatter" in
her workplace. She had to face inquiries from family and friends about her exclusion from the Bureaus
centennial anniversary memorabilia. She did not have to endure all these affronts and the angst and
depression they produced had Villanueva abided in good faith by the courts order in her favor. Clearly,
she is entitled to moral damages.

The Court, however, finds the award of P500,000.00 excessive. As it held in Philippine Commercial
International Bank v. Alejandro,18 moral damages are not a bonanza. They are given to ease the
defendants grief and suffering. Moral damages should reasonably approximate the extent of hurt caused
and the gravity of the wrong done. Here, that would be P200,000.00.

The Court affirms the grant of exemplary damages by way of example or correction for the public good
but, in line with the same reasoning, reduces it to P50,000.00. Finally, the Court affirms the award of
attorneys fees and litigation expenses but reduces it to P50,000.00.

WHEREFORE, the Court DENIES the petition and AFFIRMS the decision of the Court of Appeals dated
April 30, 2007 in CA-G.R. CV 85931 with MODIFICATION in that petitioner Titus B. Villanueva is
ORDERED to pay respondent Emma M. Rosqueta the sum of P200,000.00 in moral damages, P50,000.00
in exemplary damages, and P50,000.00 in attorneys fees and litigation expenses.

SO ORDERED.

UYPITCHING V. QUIAMCO 510 SCRA 172 (2007)

FACTS:
In 1982, respondent Quiamco was approached by Davalan, Gabutero and Generoso to settle the
civil aspect of a criminal case for robbery filed by Quiamco against them.
They surrendered to him a red Honda motorcycle and a photocopy of its certificate of registration.
Respondent asked for the original certificate of registration but the three accused never came to see him
again.
Meanwhile, the motorcycle was parked in an open space inside respondents business
establishment, where it was visible and accessible to the public.
It turned out that, in October 1981, the motorcycle had been sold on installment basis to Gabutero
by Uypitching Sons, Inc. And to secure its payment, the motorcycle was mortgaged to petitioner
corporation.
When Gabutero could no longer pay the installments, Davalan assumed the obligation and
continued the payments.
In September 1982, however, Davalan stopped paying the remaining installments.
Nine years later, petitioner Uypitching, accompanied by policemen, went to Avesco-AVNE
Enterprises to recover the motorcycle.
The leader of the police team talked to the clerk in charge and asked for respondent. While P/Lt.
Vendiola and the clerk were talking, petitioner Uypitching paced back and forth inside the establishment
uttering "Quiamco is a thief of a motorcycle."
Unable to find respondent, the policemen on petitioner Uypitchings instructionand over the
clerks objection, took the motorcycle.
Petitioner Uypitching filed a criminal complaint for qualified theft and/or violation of the Anti-
Fencing Law against respondent but was dismissed.
Respondent filed an action for damages against petitioners in the RTC
The trial court rendered a decision finding that petitioner Uypitching was motivated with malice
and ill will when he called respondent a thief, took the motorcycle in an abusive manner and filed a
baseless complaint for qualified theft and/or violation of the Anti-Fencing Law
Petitioners appealed the RTC decision but the CA affirmed the trial courts decision.

ISSUE:

WON the filing of a complaint for qualified theft and/or violation of the Anti-Fencing Law warranted the
award of moral damages, exemplary damages, attorneys fees and costs in favor of respondent.

HELD:
YES.
They were held liable for damages not only for instituting a groundless complaint against respondent but
also for making a slanderous remark and for taking the motorcycle from respondents establishment in an
abusive manner .Petitioners Abused Their Right of Recovery as Mortgagee(s)
A mortgagee may take steps to recover the mortgaged property to enable it to enforce or protect its
foreclosure right there on. There is, however, a well-defined procedure for the recovery of possession of
mortgaged property: if a mortgagee is unable to obtain possession of a mortgaged property for its sale on
foreclosure, he must bring a civil action either to recover such possession as a preliminary step to the sale,
or to obtain judicial foreclosure .Petitioner corporation failed to bring the proper civil action necessary to
acquire legal possession of the motorcycle. Instead, petitioner Uypitching descended on respondents
establishment with his policemen and ordered the seizure of the motorcycle without a search warrant or
court order. Worse, in the course of the illegal seizure of the motorcycle, petitioner Uypitching even
mouthed a slanderous statement.
Petitioners acts violated the law as well as public morals, and transgressed the proper norms of human
relations.
The basic principle of human relations, embodied in Article 19 of the Civil Code .Article 19, also known
as the "principle of abuse of right," prescribes that a person should not use his right unjustly or contrary to
honesty and good faith ,otherwise he opens himself to liability. There is an abuse of right when it is
exercised solely to prejudice or injure another.
The exercise of a right must be in accordance with the purpose for which it was established and must not
be excessive or unduly harsh; there must be nointention to harm another.
In this case, the manner by which the motorcycle was taken at petitioners instance was not only attended
by bad faith but also contrary to the procedure laid down by law. Considered in conjunction with the
defamatory statement, petitioners exercise of the right to recover the mortgaged vehicle was utterly
prejudicial and injurious to respondent.

Petitioners acted in an excessively harsh fashion to the prejudice of respondent.

Banal vs. Tadeo

Facts:
Petitioner herein is one of the complainants in the criminal cases filed againstRosario Claudio. Claudio is
charged with 15 separate information for violation of BP22. Claudio pleaded not guilty, thus trial ensued.
Petitioner moved to intervenethrough private prosecutor but it was rejected by respondent judge on the
groundthat the charge is for the violation of Batas Pambansa Blg. 22 which does notprovide for any civil
liability or indemnity and hence, it is not a crime againstproperty but public order. Petitioner filed a
motion for reconsideration but wasdenied by the respondent judge. Hence this appeal.

Issue:
Whether or not a private prosecutor may intervene in the prosecution forviolation of BP 22 which does
not provide for civil liability.

Held:

Yes. Under Art. 100 of the RPC, every person criminally liable for a felony isalso civilly liable. Thus a
person committing a felony offends namely (1) the societyin which he lives in or the political entity called
the State whose law he had violated;and (2) the individual member of that society whose person, right,
honor, chastityor property was actually or directly injured or damaged by the same punishable actor
omission.While an act or omission is felonious because it is punishable by law, it givesrise to civil
liability not so much because it is a crime but because it caused damageto another. Viewing things
pragmatically, we can readily see that what gives rise tothe civil liability is really the obligation and the
moral duty of everyone to repair ormake whole the damage caused to another by reason of his own act or
omission,done intentionally or negligently, whether or not the same be punishable by law. Inother words,
criminal liability will give rise to civil liability only if the same feloniousact or omission results in
damage or injury to another and is the direct andproximate cause thereof. Damage or injury to another is
evidently the foundation of the civil action. Such is not the case in criminal actions for, to be criminally
liable, itis enough that the act or omission complained of is punishable, regardless of whether or not it
also causes material damage to another.Article 20 of the New Civil Code provides:Every person who,
contrary to law, wilfully or negligently causes damage toanother, shall indemnify the latter for the
same.Regardless, therefore, of whether or not a special law so provides,indemnification of the offended
party may be had on account of the damage, loss orinjury directly suffered as a consequence of the
wrongful act of another.

ADALIA FRANCISCO vs. COURT OF APPEALS, ET AL.

 G.R. No. 116320 November 29, 1999
--agents

FACTS:
A. Francisco Realty & Development Corporation (AFRDC), of which petitioner Francisco is the
president, entered into a Land Development and Construction Contract with private respondent Herby
Commercial & Construction Corporation (HCCC), represented by its President and General Manager
private respondent Ong. Under the contract, HCCC was to be paid on the basis of the completed houses
and developed lands delivered to and accepted by AFRDC and the GSIS. Sometime in 1979, Ong
discovered that Diaz and Francisco, the Vice-President of GSIS, had executed and signed seven checks of
various dates and amounts payable to HCCC for completed and delivered work under the contract. Ong,
however, claims that these checks were never delivered to HCCC. It turned out that Francisco forged the
indorsement of Ong on the checks and indorsed the checks for a second time by signing her name at the
back of the checks, petitioner then deposited said checks in her savings account. A case was brought by
private respondents against petitioner to recover the value of said checks. Petitioner however claims that
she was authorized to sign Ong's name on the checks by virtue of the Certification executed by Ong in her
favor giving her the authority to collect all the receivables of HCCC from the GSIS, including the
questioned checks.

ISSUE:

Whether petitioner cannot be held liable on the questioned checks by virtue of the Certification executed
by Ong giving her the authority to collect such checks from the GSIS.

RULING:

Petitioner is liable. The Negotiable Instruments Law provides that where any person is under obligation
to indorse in a representative capacity, he may indorse in such terms as to negative personal liability. An
agent, when so signing, should indicate that he is merely signing in behalf of the principal and must
disclose the name of his principal; otherwise he shall be held personally liable. Even assuming that
Francisco was authorized by HCCC to sign Ong's name, still, Francisco did not indorse the instrument in
accordance with law. Instead of signing Ong's name, Francisco should have signed her own name and
expressly indicated that she was signing as an agent of HCCC. Thus, the Certification cannot be used by
Francisco to validate her act of forgery.

TITLE: Gasheem Shookat Baksh vs. CA

CITATION: 219 SCRA 115

FACTS:

Private respondent, Marilou Gonzales, filed a complaint dated October 27, 1987 for damages against the
petitioner for the alleged breach of their agreement to get married. She met the petitioner in Dagupan
where the latter was an Iranian medical exchange student who later courted her and proposed marriage.
The petitioner even went to Marilous house to secure approval of her parents. The petitioner then forced
the respondent to leave with him in his apartment. Marilou was a virgin before she lived with him. After
a week, she filed a complaint because the petitioner started maltreating and threatening her. He even tied
the respondent in the apartment while he was in school and drugged her. Marilou at one time became
pregnant but the petitioner administered a drug to abort the baby.

Petitioner repudiated the marriage agreement and told Marilou to not live with him since he is already
married to someone in Bacolod. He claimed that he never proposed marriage or agreed to be married
neither sought consent and approval of Marlious parents. He claimed that he asked Marilou to stay out
of his apartment since the latter deceived him by stealing money and his passport. The private respondent
prayed for damages and reimbursements of actual expenses.

ISSUE: Whether breach of promise to marry can give rise to cause for damages.

HELD:

The existing rule is that breach of promise to marry per se is not an actionable wrong. The court held that
when a man uses his promise of marriage to deceive a woman to consent to his malicious desires, he
commits fraud and willfully injures the woman. In that instance, the court found that petitioners
deceptive promise to marry led Marilou to surrender her virtue and womanhood.

Moral damages can be claimed when such promise to marry was a deceptive ploy to have carnal
knowledge with the woman and actual damages should be paid for the wedding preparation expenses.
Petitioner even committed deplorable acts in disregard of the laws of the country.
Therefore, SC set aside the decision of CA awarding damages to the respondent.

Wassmer vs. Velez 12 SCRA 648

BEATRIZ P. WASSMER, plaintiff-appellee, vs. FRANCISCO X. VELEZ, defendant-
appellant.

FACTS:

In 1954, Beatriz Wassmer and Francisco Velez arranged their marriage to be held on September 4 of the
same year. The bride-to-be has been devoted with all the preparations for their wedding. However, two
days before their marriage, Paking left a note that they must postpone the marriage for his mother was
against it. A day before their wedding, Paking wrote again that the wedding shall push through. Worse,
Paking did not show up on their wedding day causing Wassmer to be publicly humiliated.

The breach of promise to marry made by Velez prompted Wassmer to file a civil suit against the former.
Velez never filed an answer, thus, awarding moral and exemplary damages to Wassmer.

Velez appealed on the court and stated that he failed to attend the wedding day because of fortuitous
events. He also insisted that he cannot be civilly liable for there is no law that acts upon the breach of
promise to marry. He also contested the award of moral and exemplary damages.

ISSUE: Whether or not moral or exemplary damages may be awarded in a breach of promise to marry
suit.

HELD: A mere breach of promise to marry is not an actionable wrong. However, Wassmer has already
made preparations for the wedding. Velezs failure to appear on the wedding day is contrary to morals,
good customs and public policy which is embodied on Article 21 of the Civil Code. Under the law, the
injured party is entitled to moral damages as well as to exemplary damages because Velezs acted in
wanton, reckless and oppressive manner (Article 2232) in breaching his promise to marry Wassmer.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 174364 July 30, 2009

NORTHWEST AIRLINES, Petitioner,

vs.
DELFIN S. CATAPANG, Respondent.

Delfin S. Catapang (respondent), a lawyer and, at the time material to the case at bar, Assistant Vice
President and Head of the Special Projects Department, Corporate Services Division of the United
Coconut Planters Bank (UCPB), was directed by UCPB to go to Paris on a business trip. As he intended
to proceed, after his trip to Paris, to the United States to visit his siblings, he requested First United
Travel, Inc. (FUT) to issue him a ticket that would allow rebooking or rerouting of flights within the
United States.

Complying with respondents requirement, FUT informed him, via telephone, that Northwest Airlines,
Inc. (petitioner) was willing to accommodate his request provided he would pay an additional US$50 for
every rebooking or rerouting of flight. Respondent agreed with the condition, hence, FUT, as petitioners
authorized agent, issued respondent a ticket covering the New York to Los Angeles via Detroit and the
Los Angeles to Manila segments of his travel, indicating thereon the following details of his itinerary:

xxxx

12MAR LV NYC/LAGUARDIA 0935 NORTHWEST

AR LOS ANGELES 1433
VIA DETROIT MI
xxxx
The rebooking/rerouting scheme was annotated on the restriction portion of the ticket issued to
respondent bearing No. 012 6832392670 5 as follows:

No end./7 days adv. Purchase

US$50 rebooking/re-routing/cancellation fee (Underscoring supplied)

On respondents arrival in New York, he called up by telephone petitioners office which informed him
that his ticket was not "rebookable or reroutable." He was, nevertheless, advised to go to petitioners
nearest branch office.

Respondent thus proceeded on March 10, 1992 to petitioners ticket office at the World Trade Center
where he was treated in a rude manner by an employee who informed him that his ticket was not
rebookable or reroutable since it was of a "restricted type," and that unless he upgraded it by paying
US$644.00, he could not rebook. Left with no choice, respondent paid that amount for rebooking.

Upon his return to the Philippines, respondent, by letter of March 24, 1992, wrote petitioner:

At about 9:30 in the morning of March 11, 1992, I went to the sales office in the World Trade Center
where I explained to your black woman representative my predicament. Your representative rudely told
me that my ticket is the restrictive type and that my flight can not be rebooked or rerouted. I explained
that the only restriction on my ticket is that I should pay US$50.00 if I have to rebook or reroute my flight
and asked your representative to read the restriction. Your representative rudely and impolitely retorted
that I could not understand English and that unless I pay the amount of US$644.00, I cannot get a
rebooking and rerouting. Despite my appeal and protestation, she did not reconsider her decision. As I
was badly needed in Detroit on the evening of the same day and had to be back in Manila on the 14th of
March, I was compelled to pay, under protest, the amount of US$644.00 using my American Express
Card as my cash was insufficient to cover the amount. It was only then that I was issued ticket no.
012:4488:504:099.

Considering that my ticket was cleared with you prior to its issuance and that FUT is your duly accredited
agent, you are bound by the terms of the ticket issued by FUT in your behalf. You have no right to
unilaterally change the tenor of your contract during its effectivity without my consent.

Your airlines willful breach of the terms and conditions of my ticket and the shabby treatment that I
received from your personnel hurt my feeling, humiliated and embarrassed me in the presence of my
brother-in-law and other people nearby who witnessed the incident. The fact that your employee did that
to a bank officer and a lawyer like me only shows that your airline can also do the same to others, not to
mention the poor and hapless persons.

Because I could not bear my wounded feeling, the shabby treatment, the humiliation and the
embarrassment that I received from your employee, I asked for the cancellation and refund of my ticket
covering my trip from Los Angeles to the Philippines for which I was given a refund application slip no.
012 0230189256 3 by your ticket counter at the Los Angeles airport on March 12, 1992.

To compensate me for the expenses that I incurred, and the wounded feeling, humiliation and
embarrassment that were caused by your airlines willful breach of contract with me, I demand that you
pay me damages in the amount of P1,000,000.00 within a period of five (5) days from your receipt
hereof. Otherwise, I shall have no alternative but to seek redress from our court of justice and to hold you
liable for all other expenses attendant thereto.1 (Underscoring supplied)

Respondents letter of demand remained unanswered, unheeded, drawing him to file on July 1, 1992 with
the Regional Trial Court (RTC) of Makati a complaint for damages against petitioner.

Petitioner claimed in its Answer that respondents ticket was a discounted one, subject to the rules which
petitioners agents have to abide by. Thus, with respect to the annotation on respondents ticket of the
US$50.00 rebooking charge, petitioner explained that the same was subject to the "rules of applicability,"
which rules could not be reflected on the ticket.

By Decision of October 5, 2000,2 Branch 56 of the RTC Makati faulted petitioner for breach of contract
of carriage, disposing as follows:

WHEREFORE, all the foregoing considered, this Court declares defendant liable to pay plaintiff and
orders the latter to pay him the following sums:

1. US$ 823.00 or its Peso equivalent at the time of the payment with legal interest and Php7,372.50 for
filing fees as actual damages;
2. P800,000.00 as moral damages;
3. P100,000.00 as exemplary damages;
4. P200,000.00 as and for attorneys fees; and
5. Cost of suit.

SO ORDERED.3
On appeal, the Court of Appeals, by Decision of June 30, 20064 affirmed the trial courts Decision with
modification, thus:
WHEREFORE, except for the reduction of the award of moral damages from P800,000.00 to
P400,000.00, the appealed Decision dated October 5, 2000 is affirmed in all other respects.

SO ORDERED."5 (Underscoring supplied)

Hence, the present petition which assails the award to respondent of moral damages, petitioner positing
that it was not guilty of breach of contract. In any event, it assails the award to respondent of exemplary
damages, it positing that the same is not recoverable in cases of breach of contract of carriage unless the
carrier is guilty of wanton, fraudulent, reckless, oppressive or malevolent conduct of which it is not, so it
claims.

Additionally, petitioner assails 1) the award of attorneys fees, positing that under Article 2208 of the
Civil Code, attorneys fees and expenses of litigation cannot, as a general rule, be recovered, and of actual
damages for respondent did not suffer any pecuniary loss; 2) the order for reimbursement of filing fees
there being no basis; and 3) the award of a total of P700,000.00 in damages for being excessive and
unprecedented.

The petition is bereft of merit.

When respondent inquired from petitioners agent FUT if he would be allowed to rebook/reroute his
flight, FUT advised him that he could, on the condition that he would pay $50 for every rebooking. He
was not told by FUT and the ticket did not reflect it that the ticket being issued to him was a "restricted
type" to call for its upgrading before a rebooking/rerouting.lawph!l

Petitioners reservation supervisor, Amelia Merris, in fact admitted that, as the above-quoted entry on the
restriction portion of the ticket reads, the only restriction on respondents ticket pertains only to non-
endorsement.

ATTY. CATAPANG

Q. x x x Is it a fact that the only restriction on the first line is that no end./7days advance purchase, is that
correct? And what does that phrase no.end/7days purchase means?
A. "No end," means non endorsable, sir.
Q. When you say non endorsable you cannot transfer it to another airline?
A. That is right, sir.
xxxx
Q. Based on the restriction, there is no such restriction?
A. Yes, sir.6 (Underscoring supplied)

Petitioners breach in this case was aggravated by the undenied treatment received by respondent when he
tried to rebook his ticket. Instead of civilly informing respondent that his ticket could not be rebooked,
petitioners agent in New York exhibited rudeness in the presence of respondents brother-in-law and
other customers, insulting respondent by telling him that he could not understand English.

Passengers have the right to be treated by a carriers employees with kindness, respect, courtesy and due
consideration. They are entitled to be protected against personal misconduct, injurious language,
indignities and abuses from such employees. So it is that any discourteous conduct on the part of these
employees toward a passenger gives the latter an action for damages against the carrier.7

The award of moral and exemplary damages to respondent is thus justified.

The inclusion of filing fees as part of the actual damages is superfluous, if not erroneous, the same being
chargeable to the "cost of suit" awarded by the trial court and affirmed by the appellate court. Sections 8
and 10, Rule 142 of the Rules of Court enlighten:

SEC. 8. Costs, how taxed. In inferior courts, the costs shall be taxed by the justice of the peace or
municipal judge and included in the judgment. In superior courts, costs shall be taxed by the clerk of the
corresponding court on five days' written notice given by the prevailing party to the adverse party. With
this notice shall be served a statement of the items of costs claimed by the prevailing party, verified by his
oath or that of his attorney. Objections to the taxation shall be made in writing, specifying the items
objected to. Either party may appeal to the court from the clerk's taxation. The costs shall be inserted in
the judgment if taxed before its entry, and payment thereof shall be enforced by execution.
xxxx
SEC. 10. Costs in Courts of First Instance. In an action or proceeding pending in a Court of First
Instance, the prevailing party may recover the following costs, and no other:

a) For the complaint or answer, fifteen pesos;

b) For his own attendance, and that of his attorney, down to and including final judgment, twenty pesos;
c) For each witness necessarily produced by him, for each day's necessary attendance of such witness at
the trial, two pesos, and his lawful traveling fees;
d) For each deposition lawfully taken by him, and produced in evidence, five pesos;
e) For original documents, deeds, or papers of any kind produced by him, nothing;
f) For official copies of such documents, deeds, or papers, the lawful fees necessarily paid for obtaining
such copies;
g) The lawful fees paid by him in entering and docketing the action or recording the proceedings, for the
service of any process in action, and all lawful clerk's fees paid by him." (Emphasis and underscoring
supplied)

As for the award of attorneys fees, the trial court did not state the factual and legal basis thereof.8 The
transcript of stenographic notes of the lower courts proceedings do not show that respondent adduced
proof to sustain his general averment of a retainer agreement in the amount of P200,000.00. The award
must thus be deleted.

WHEREFORE, the Court of Appeals Decision of June 30, 2006 is AFFIRMED with MODIFICATION in
that the award of attorneys fees is deleted for lack of basis. And the award of actual damages of
P7,372.50 representing filing fees is deleted.

SO ORDERED.

Equitable PCI Bank V. Ong (2006)

G.R. No. 156207 September 15, 2006

FACTS:

Warliza Sarande deposited in her account at Philippine Commercial International (PCI) Bank a PCI Bank
TCBT Check of P225K.

December 5 1991: Upon inquiry by Serande at PCI Bank on whether the TCBT Check had been cleared,
she received an affirmative answer.

Relying on this assurance, she issued 2 checks drawn against the proceeds of TCBT Check.

PCI Bank Check No. 073661 dated 5 December 1991 for P132K which Sarande issued to respondent
Rowena Ong owing to a business transaction.

On the same day, Ong presented to PCI Bank requesting PCI Bank to convert the proceeds into a
manager's check, which the PCI Bank obliged.

December 6 1991: Ong deposited PCI Bank Manager's Check in her account with Equitable Banking
Corporation

December 9 1991: she received a check return-slip informing her that PCI Bank had stopped the payment
of the check on the ground of irregular issuance.

Despite several demands made, it was refused

Ong was constrained to file a Complaint for sum of money, damages and attorney's fees against PCI Bank

CA affirmed RTC: favored Ong

ISSUE: W/N Ong can hold PCI liable

HELD: YES. Petition is DENIED. CA affirmed.

By admitting it committed an error, clearing the check of Sarande and issuing in favor of Ong not just any
check but a manager's check for that matter, PCI Bank's liability is fixed
certification = acceptance,

Equitable PCI as drawee bank is bound on the instrument upon certification and it is immaterial to such
liability in favor of Ong who is a holder in due course whether the drawer (Warliza Sarande) had funds or
not with the Equitable PCI Bank

No unjust enrichment

SECTION 52.
What constitutes a holder in due course. A holder in due course is a holder who has taken the instrument
under the following conditions:
(a) That it is complete and regular upon its face;
(b) That he became the holder of it before it was overdue, and without notice it had been previously
dishonored, if such was the fact;
(c) That he took it in good faith and for value;
(d) That at the time it was negotiated to him, he had no notice of any infirmity in the instrument or defect
in the title of the person negotiating it.
The same law provides further:

Sec. 24. Presumption of consideration. Every negotiable instrument is deemed prima facie to have been
issued for a valuable consideration; and every person whose signature appears thereon to have become a
party thereto for value.

Sec. 26. What constitutes holder for value. Where value has at any time been given for the instrument,
the holder is deemed a holder for value in respect to all parties who become such prior to that time.

Sec. 28. Effect of want of consideration. Absence or failure of consideration is a matter of defense as
against any person not a holder in due course; and partial failure of consideration is a defense pro tanto,
whether the failure is an ascertained and liquidated amount or otherwise.
manager's check an order of the bank to pay, drawn upon itself, committing in effect its total resources,
integrity and honor behind its issuance regarded substantially to be as good as the money it represents
same footing as a certified check

The object of certifying a check, as regards both parties, is to enable the holder to use it as money.
check operates as an assignment of a part of the funds to the creditors

Sec. 187. Certification of check; effect of. Where a check is certified by the bank on which it is drawn,
the certification is equivalent to an acceptance

Section 63 of the Central Bank Act to the effect "that a check which has been cleared and credited to the
account of the creditor shall be equivalent to a delivery to the creditor in cash in an amount equal to the
amount credited to his account

Sec. 62. Liability of acceptor. The acceptor by accepting the instruments engages that he will pay it
according to the tenor of his acceptance; and admits
(a) The existence of the drawer, the genuineness of his signature, and his capacity and authority to draw
the instrument; and
(b) The existence of the payee and his then capacity to indorse.

Villalva vs rcbc