Caltex v.

Palomar [GR L-19650, 29 September 1966]

PERTINENT LAWS

SECTION 1954. Absolutely non-mailable matter. — No matter belonging to

any of the following classes, whether sealed as first-class matter or not, shall
be imported into the Philippines through the mails, or to be deposited in or
carried by the mails of the Philippines, or be delivered to its addressee by any
officer or employee of the Bureau of Posts:

Written or printed matter in any form advertising, describing, or in any

manner pertaining to, or conveying or purporting to convey any information
concerning any lottery, gift enterprise, or similar scheme depending in whole
or in part upon lot or chance, or any scheme, device, or enterprise for
obtaining any money or property of any kind by means of false or fraudulent
pretenses, representations, or promises.

"SECTION 1982. Fraud orders.—Upon satisfactory evidence that any

person or company is engaged in conducting any lottery, gift enterprise, or
scheme for the distribution of money, or of any real or personal property by
lot, chance, or drawing of any kind, or that any person or company is
conducting any scheme, device, or enterprise for obtaining money or
property of any kind through the mails by means of false or fraudulent
pretenses, representations, or promises, the Director of Posts may instruct
any postmaster or other officer or employee of the Bureau to return to the
person, depositing the same in the mails, with the word "fraudulent" plainly
written or stamped upon the outside cover thereof, any mail matter of
whatever class mailed by or addressed to such person or company or the
representative or agent of such person or company.

SECTION 1983. Deprivation of use of money order system and

telegraphic transfer service.—The Director of Posts may, upon evidence
satisfactory to him that any person or company is engaged in conducting any
lottery, gift enterprise or scheme for the distribution of money, or of any real
or personal property by lot, chance, or drawing of any kind, or that any
person or company is conducting any scheme, device, or enterprise for
obtaining money or property of any kind through the mails by means of false
or fraudulent pretenses, representations, or promise, forbid the issue or
payment by any postmaster of any postal money order or telegraphic
transfer to said person or company or to the agent of any such person or
company, whether such agent is acting as an individual or as a firm, bank,
corporation, or association of any kind, and may provide by regulation for the
return to the remitters of the sums named in money orders or telegraphic
transfers drawn in favor of such person or company or its agent.

Conditions sine qua non for declaratory relief

Conditions sine qua non: (1) there must be a justiciable controversy; (2) the
controversy must be between persons whose interests are adverse; (3) the party
seeking declaratory relief must have a legal interest in the controversy; and (4) the
issue involved must be ripe for judicial determination. In the case at bar, all the
conditions are present. Caltex’s insistent assertion of its claim to the use of the
mails for its proposed contest, and the challenge thereto and consequent denial by
Palomar of the privilege demanded, undoubtedly spawned a live controversy. There
is an active antagonistic assertion of a legal right on one side and a denial thereof
on the other, concerning a real question or issue. The contenders are as real as
their interest are substantial. To Caltex, the uncertainty occasioned by the
divergence of views on the issue of construction hampers or disturbs its freedom to
enhance its business. To Palomar, the suppression of Caltex’s proposed contest
believed to transgress a law he has sworn to uphold and enforce is an unavoidable
duty. With Caltex’s bent to hold the contest and the Palomar’s threat to issue a
fraud order therefor if carried out, the contenders are confronted by the ominous
shadow of an imminent and inevitable litigation unless their differences are settled
and stabilized by a tranquilizing declaration.

3. Definition of Statutory Construction

Construction is the art or process of discovering and expounding the meaning and
intention of the authors of the law with respect to its application to a given case,
where that intention is rendered doubtful, amongst others, by reason of the fact
that the given case is not explicitly provided for in the law (Black). In the case at
bar, whether or not the scheme proposed by the appellee is within the coverage of
the prohibitive provisions of the Postal Law inescapably requires an inquiry into the
intended meaning of the words used therein.

4, Judicial duty to look into substance of law

The Court is tasked to look beyond the fair exterior, to the substance, in order to
unmask the real element and pernicious tendencies which the law is seeking to
prevent.

5. Case not an advisory opinion nor premature; Rules of Court liberally

construed
Even if there has been no breach of the Postal Law yet, there is propriety or
necessity of setting the dispute at rest before it accumulates the asperity,
distemper, animosity, passion and violence of a full-blown battle which looms
ahead. Denial of declaratory relief would force it to choose between undesirable
alternatives: that of being a self-appointed censor, or that to be at risk of a fraud
order. Considering the alternatives in one equation and in the spirit of liberality with
which the Rules of Court are to be interpreted in order to promote their object
(Section 1, Rule 1, Revised Rules of Court), i.e. to settle, and afford relief from
uncertainty and insecurity with respect to, rights and duties under a law; there is no
imposition upon the Court’s jurisdiction or any futility or prematurity in our
intervention.

6. Judicial decision interpreting or applying a law forms part of legal

system
Judicial decisions applying or interpreting the law shall form a part of the legal
system”(Article 8, Civil Code of the Philippines). In effect, judicial decision assume
the same authority as the statute itself and, until authoritatively abandoned,
necessarily become, to the extent that they are applicable, the criteria which must
control the actuations not only of those called upon to abide thereby but also of
those in duty bound to enforce obedience thereto. The jurisdiction of the Court, nor
its ruling’s force and binding effect, cannot be underrated not to have the final and
pacifying function that a declaratory judgment is calculated to subserve. At the very
least, the appellant will be bound. Precedent are abundant to support the
conclusion that the Court has reached (Liberty Calendar Co. v. Cohen, 19 NJ 399,
117 A 2d 487; In pari material, also: Bunis v. Conway, 17 App. Div. 2d, 207, 234 NYS
2d, 435; Zeitlin v. Arnebergh, supra.; Thrillo, Inc. v. Scott, 15 NJ Super. 124, 82 A.
2d, 903)

7. Lottery and gift enterprise defined; Caltex contest not a lottery nor
gift enterprise
The term ‘lottery’ extends to all schemes for the distribution of prizes by chance,
such as policy playing, gift exhibitions, prize concerts, raffles at fairs, etc., and
various forms of gambling. The three essential elements of a lottery are: First,
consideration; second, prize; and third, chance (El Debate v. Topacio, 44 Phil 278,
1922; citing various jurisprudence). With respect to the last element of
consideration, the law does not condemn the gratuitous distribution of property by
chance, if no consideration is derived directly or indirectly from the party receiving
the chance, but does condemn as criminal schemes in which a valuable
consideration of some kind is paid directly or indirectly for the chance to draw a
prize.
While an all-embracing concept of the term “gift enterprise” is yet to be spelled out
in explicit words, there appears to be a consensus among lexicographers and
standard authorities that the term is commonly applied to a sporting artifice under
which goods are sold for their market value but by way of inducement each
purchaser is given a chance to win a prize.
In the case at bar, there is no requirement in the rules that any fee be paid, any
merchandise be bought, any service be rendered, or any value whatsoever be given
for the privilege to participate; for the scheme to be deemed a lottery. Neither is
there is a sale of anything to which the chance offered is attached as an
inducement to the purchaser for the scheme to be deemed a gift enterprise. The
scheme is merely a gratuitous distribution of property by chance.

8. Consideration does not consist of benefit derived by sponsor of the

contest
The required element of consideration does not consist of the benefit derived by the
proponent of the contest. The true test is whether the participant pays a valuable
consideration for the chance, and not whether those conducting the enterprise
receive something of value in return for the distribution of the prize. Perspective
properly oriented, the standpoint of the contestant is all that matters, not that of
the sponsor (People vs. Cardas, 28 P. 2d. 99, 137 Cal. App. (Supp). 788)

9. Conflicting viewpoints on gift enterprise warrants resolution on case-

to-case basis
The apparent conflict of opinions (for one: holding that a gift enterprise involving an
award by chance, even in default of the element of consideration necessary to
constitute a lottery, is prohibited; or the other: like a lottery, a gift enterprise comes
within the prohibitive statutes only if it exhibits the tripartite elements of prize,
chance and consideration) is explained by the fact that the specific statutory
provisions relied upon are not identical. In some cases, the terms “lottery” and “gift
enterprise” are used interchangeably; in others, the necessity for the element of
consideration or chance has been specifically eliminated by statute. Every case,
thus, must be resolved upon the particular phraseology of the applicable statutory
provision.

10. Noscitur a sociis

Consonant to the well-known principle of legal hermeneutics noscitur a sociis, the
term under construction should be accorded no other meaning than that which is
consistent with the nature of the word associated therewith. Hence, if lottery is
prohibited only if it involves a consideration, so also must the term “gift enterprise”
be so construed. Significantly, there is not in the law the slightest indicium of any
intent to eliminate that element of consideration from the “gift enterprise” therein
included. This conclusion firms up in the light of the mischief sought to be remedied
by the law, resort to the determination thereof being an accepted extrinsic aid in
statutory construction. Mail fraud orders, it is axiomatic, are designed to prevent
the use of the mails as a medium for disseminating printed matters which on
grounds of public policy are declared non-mailable. As applied to lotteries, gift
enterprises and similar schemes, justification lies in the recognized necessity to
suppress their tendency to inflame the gambling spirit and to corrupt public morals.
Gratuitous distribution of property by lot or chance does not constitute ‘lottery’, if it
is not resorted to as a device to evade the law and no consideration is derived,
directly or indirectly, from the party receiving the chance, gambling spirit not being
cultivated or stimulated thereby. Thus, gift enterprises and similar schemes therein
contemplated are condemnable only if, like lotteries, they involve the element of
consideration.
National Federation of Labor v. Eima [GR L-61236, 31 January 1984]
En Banc, Fernando (p): 9 concur, 1 concur with hope that Article 217 does not
undergo repeated amendments, 1 took no part, 1 on leave

FACTS:
On 5 March 1982, the National Federation of Labor filed with the Ministry of Labor
and Employment, Labor Relations Division, Zamboanga City, a petition for direct
certification as the sole exclusive collective bargaining representative of the
monthly paid employees of the Zamboanga Wood Products, Inc. at its
manufacturing plant in Lumbayao, Zamboanga City. Such employees, on 17 April
1982 charged the firm before the same office of the Ministry of Labor for
underpayment of monthly living allowances. On 3 May 1982, the union issued a
notice of strike against the firm, alleging illegal termination of Dionisio Estioca,
president of the said local union; unfair labor practice; nonpayment of living
allowances; and “employment of oppressive alien management personnel without
proper permit. It was followed by the union submitting the minutes of the
declaration of strike, including the 90 ballots (79, yes, 3 no). The strike began on 23
May 1982.

On 9 July 1982, Zambowood filed a complaint with the trial court against the officers
and members of the union, for damages for obstruction of private property with
prayer for preliminary injunction and/or restraining order. 6 days later, there was a
motion for the dismissal and for the dissolution of the restraining order and
opposition to the issuance of the writ of preliminary injunction filed by petitioners.
The motion to dismiss was denied. Hence the petition for certiorari.

The Supreme Court granted the writ of certiorari, and nullified and set aside the 20
July 1982 order issued by the respondent Judge. It granted the writ of prohibition,
and enjoined the Judge, or whoever acts in his behalf in the RTC to which this case
is assigned, from taking any further action on Civil Case 716 (2751), except for the
purpose of dismissing it. It also made permanent the TRO issued on 5 August 1982.

PERTINENT LAWS

Article 217. Jurisdiction of Labor Arbiters and the Commission. — (a) The Labor
Arbiters shall have the original and exclusive jurisdiction to hear and decide the
following cases involving all workers, whether agricultural or non-agricultural: ... 3.
All money claims of workers, including those based on nonpayment or
underpayment of wages, overtime compensation, separation pay and other benefits
provided by law or appropriate agreement, except claims for employees'
compensation, social security, medicare and maternity benefits; 4. Cases involving
household services; and 5. All other claims arising from employer-employee
relations, unless expressly excluded by this Code."

1. Jurisdiction of case belong to labor arbiters and not CFI; History of

amendments to Art. 217
(1) The original wording of Article 217 of the Labor Code vested the labor arbiters
with jurisdiction (applied in Garcia v. Martinez and in Bengzon v. Inciong). (2) On 1
May 1978, however, PD 1367 was issued, amending Article 217, and provided that
the Regional Directors shall not indorse and Labor Arbiters shall not entertain claims
for moral and other forms of damages. The ordinary courts were thus vested with
jurisdiction to award actual and moral damages in the case of illegal dismissal of
employees. (3) On 1 May 1980, PD 1691 was issued, further amending Article 217,
returning the original jurisdiction to the labor arbiters, enabling them to decide all
money claims of workers, including those based on nonpayment or underpayment
of wages, overtime compensation, separation pay and other benefits provided by
law or appropriate agreement, except claims for employees compensation, social
security, medicare and maternity benefits; all other claims arising from employer-
employee relations unless expressly excluded by the Code. (4) On 21 August 1981
BP 130, amending Article 217. Subparagraph 2, paragraph (a) was worded as “(2)
those that involve wages, hours of work and other terms and conditions of
employment,” replacing the former phraseology: “(2) unresolved issue in collective
bargaining, including those that involve wages, hours of work and other terms and
conditions of employment.” BP 130 made no change with respect to the original
and exclusive jurisdiction of Labor Arbiters with respect to money claims of workers
or claims for damages arising from employer-employee relations.

Article 217 is to be applied the way it is worded. The exclusive original jurisdiction
of a labor arbiter is therein provided for explicitly. It means, it can only mean, that a
court of first instance judge then, a regional trial court judge now, certainly acts
beyond the scope of the authority conferred on him by law when he entertained the
suit for damages, arising from picketing that accompanied a strike. The plain
command of the law that it is a labor arbiter, not a court, that possesses original
and exclusive jurisdiction to decide a claim for damages arising from picketing or a
strike (Pepsi-Cola Bottling Co. v. Martinez; Ebon v. De Guzman; and Aguda v.
Vallejos). Further, unless the law speaks clearly and unequivocally, trend shows that
the choice should fall on an administrative agency (Philippine American
Management & Financing Co., Inc. v. Management & Supervisors Association of the
Philippine-American Management & Financing Co., Inc.).

2. Statutory Construction, when applied

The first and fundamental duty of courts, in our judgment, is to apply the law.
Construction and interpretation come only after it has been demonstrated that
application is impossible or inadequate without them (Lizarraga Hermanos v. Yap
Tico, 1913). Any deviation from the express terms of the law cannot therefore be
tolerated.

3. Jurisdiction of exercise of compulsory arbitration and claims for

damages under Article 217 belong to the Ministry of Labor
No valid distinction can be made between the exercise of compulsory arbitration
vested in the Ministry of Labor and the jurisdiction of a labor arbiter to pass over
claims for damages in the light of the express provision of the Labor Code as set
forth in Article 217. In both cases, it is the Ministry, not a court of justice, that is
vested by law with competence to act on the matter.
Haystack: Paat v. CA [GR 111107, 10 January 1997]
Paat v. CA [GR 111107, 10 January 1997]
Second Division, Torres Jr. (p): 4 concur.

FACTS:
On 19 May 1989, Victoria de Guzman’s truck was seized by DENR personnel in
Aritao, Nueva Vizcaya while on its ways to Bulacan from san Jose, Baggao, Cagayan
because the driver could not produce the required documents for the forest
products found concealed in the truck. On 23 May 1989, Aritao CENRO’s Jovito
Layugan issued an order of confiscation of the truck and gave the owner 15 days
within which to submit an explanation why the truck should not be forfeited. De
Guzman failed to submit the required explanation. On 22 June 1989, Regional
Executive Director Rogelio Baggayan of DENR sustained Layugan’s action of
confiscation and ordered the forfeiture of the truck invoking Section 68-A of PD 705
as amended by EO 277. De Guzman filed a letter of reconsideration dated 28 June
1989, which was denied in a subsequent order of 12 July 1989.

The case was brought by the petitioners to the Secretary of DENR. Pending
resolution however of the appeal, a suit for replevin, docketed as Civil Case 4031,
was filed by the private respondents against petitioner Layugan and Executive
Director Baggayan with the RTC Cagayan (Branch 2), which issued a writ ordering
the return of the truck to private respondents. The trial court denied the motion to
dismiss by the petititoners in an order dated 28 December 1989. Their motion for
reconsideration having been likewise denied.

A petition for certiorari was filed by the petitioners with the CA which sustained the
trial court’s order ruling that the question involved is purely a legal question. Hence,
the petition, with prayer for TRO and/or preliminary injunction was filed by the
petitioners on 9 September 1993. By virtue of the Resolution dated 27 September
1993, the prayer for the issuance of TRO of petitioners was granted by the
Supreme Court.

The Supreme Court granted the petition, reversed and set aside the 16 October
decision and 14 July 1992 resolution of the CA, made permanent the restraining
order promulgated on 27 September 1993, and directed the DENR secretary to
resolve the controversy with utmost dispatch.

PERTINENT LAWS:

Sec. 8. REVIEW — All actions and decisions of the Director are subject to
review, motu propio or upon appeal of any person aggrieved thereby, by the
Department Head whose decision shall be final and executory after the lapse of
thirty (30) days from the receipt of the aggrieved party of said decision, unless
appealed to the President in accordance with Executive Order No. 19, Series of
1966. The Decision of the Department Head may not be reviewed by the courts
except through a special civil action for certiorari or prohibition.

1. Doctrine of exhaustion of administrative remedies

Before a party is allowed to seek the intervention of the court, it is a pre-condition
that he should have availed of all the means of administrative processes afforded
him. If a remedy within the administrative machinery can still be resorted to by
giving the administrative officer concerned every opportunity to decide on a matter
that comes within his jurisdiction then such remedy should be exhausted first
before court’s judicial power can be sought. The premature invocation of court’s
intervention is fatal to one’s cause of action. Thus, in the case at bar, the
respondents cannot, without violating the principle of exhaustion of administrative
remedies, seek court’s intervention by filing an action for replevin for the grant of
their relief during the pendency of an administrative proceedings.

2. Principle of exhaustion of administrative remedies not absolute

The doctrine is relative and its flexibility is called upon by the peculiarity and
uniqueness of the factual and circumstantial settings of a case. It is disregarded (1)
when there is a violation of due process, (2) when the issue involved is purely a
legal question, (3) when the administrative action is patently illegal amounting to
lack or excess of jurisdiction, (4) when there is estoppel on the part of the
administrative agency concerned, (5) when there is irreparable injury, (6) when the
respondent is a department secretary whose acts as an alter ego of the President
bears the implied and assumed approval of the latter, (7) when to require
exhaustion of administrative remedies would be unreasonable, (8) when it would
amount to a nullification of a claim, (9) when the subject matter is a private land in
land case proceedings, (10) when the rule does not provide a plain, speedy and
adequate remedy, and (11) when there are circumstances indicating the urgency of
judicial intervention.

3. Doctrine of primary jurisdiction

The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself
the authority to resolve a controversy the jurisdiction over which is initially lodged
with an administrative body of special competence. In the case at bar, the
enforcement of forestry laws, rules and regulations and the protection,
development and management of forest lands fall within the primary and special
responsibilities of the Department of Environment and Natural Resources. By the
very nature of its function, the DENR should be given a free hand unperturbed by
judicial intrusion to determine a controversy which is well within its jurisdiction. The
assumption by the trial court of the replevin suit constitutes an unjustified
encroachment into the domain of the administrative agency’s prerogative.

4. Due process is opportunity or right to be heard, not necessarily

requiring a hearing
Due process does not necessarily mean or require a hearing, but simply an
opportunity or right to be heard. One may be heard, not solely by verbal
presentation but also, and perhaps many times more creditably and practicable
than oral argument, through pleadings. Further, deprivation of due process cannot
be successfully invoked where a party was given the chance to be heard on his
motion for reconsideration.
The essence of due process is simply an opportunity to be heard, or as applied to
administrative proceedings, an opportunity to explain one’s side or an opportunity
to seek a reconsideration of the action or ruling complained of. A formal or trial type
hearing is not at all times and in all instances essential. The requirements are
satisfied when the parties are afforded fair and reasonable opportunity to explain
their side of the controversy at hand. What is frowned upon is the absolute lack of
notice or hearing. (Navarro v. Damasco)

5. Rules liberal in administrative proceedings

In administrative proceedings, technical rules of procedure and evidence are not
strictly applied; administrative process cannot be fully equated with due process in
its strict judicial sense.

6. Statutes construed to give effect to purposes projected in statute;

“To dispose of the same” includes conveyance
In the construction of statutes, it must be read in such a way as to give effect to the
purpose projected in the statute. Statutes should be construed in the light of the
object to be achieved and the evil or mischief to be suppressed, and they should be
given such construction as will advance the object, suppress the mischief, and
secure the benefits intended. In the case at bar, the phrase “to dispose of the
same” is broad enough to cover the act of forfeiting conveyances in favor of the
government. The only limitation is that it should be made “in accordance with
pertinent laws, regulations or policies on the matter.”

7. When statute is clear, court cannot rationalize the law

When the statute is clear and explicit, there is hardly room for any extended court
ratiocination or rationalization of the law. In the case at bar, the language of EO277
when it eliminated the phrase “shall be guilty of qualified theft as defined and
punished under Articles 309 and 310 of the Revised Penal Code ” and inserted the
words ” shall be punished with the penalties imposed under Article 309 and 310 of
the Revised Penal Code,” meant that the act of cutting, gathering, collecting,
removing, or possessing forest products without authority constitutes a distinct
offense independent now from the crime of theft under Articles 309 and 310 of the
Revised Penal Code, but the penalty to be imposed is that provided for under Article
309 and 310 of the Revised Penal Code.

8. Suit of replevin as relief

A suit for replevin is founded solely on the claim that the defendant wrongfully
withholds the property sought to be recovered. It lies to recover possession of
personal chattels that are unlawfully detained. Under the Rules of Court, it is
indispensable in replevin proceeding that the plaintiff must show by his own
affidavit that he is entitled to the possession of property, that the property is
wrongfully detained by the defendant, alleging the cause of detention, that the
same has not been taken for tax assessment, or seized under execution, or
attachment, or if so seized, that it is exempt from such seizure, and the actual value
of the property. In the case at bar, the suit for replevin is never intended as a
procedural tool to question the orders of confiscation and forfeiture issued by the
DENR in pursuance to the authority given under PD 705, as actions taken by the
Director of the Bureau of Forest Development concerning the enforcement of the
provisions of the said law are subject to review by the Secretary of DENR and that
courts may not review the decisions of the Secretary except through a special civil
action for certiorari or prohibition.
9. “To detain” defined
“To detain” is defined as to mean “to hold or keep in custody,” and it has been held
that there is tortious taking whenever there is an unlawful meddling with the
property, or an exercise or claim of dominion over it, without any pretense of
authority or right; this, without manual seizing of the property is sufficient.

People v. Mapa
GR L-22301, 30 August 1967 (20 SCRA 1164)
En Banc, Fernando (p): 9 concur

FACTS:

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

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

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

Reliance in the decision in People v. Macarandang is misplaced, and the case no

longer speaks with authority to the extent that the present decision conflicts with. It
may be note that in People v. Macarandang, a secret agent was acquitted on appeal
on the assumption that the appointment of the accused as a secret agent to assist
in the maintenance of peace and order campaigns and detection of crimes
sufficiently put him within the category of a ‘peace officer’ equivalent even to a
member of the municipal police expressly covered by section 879, Thus, in the
present case, therefore, the conviction must stand.
The Supreme Court affirmed the appealed judgment.

Daoang v. Municipal Judge of San Nicolas (GR L-34568, 28 March 1988)

On 23 March 1971, the respondent spouses Antero and Amanda Agonoy filed a
petition with the Municipal Court of San Nicolas, Ilocos Norte, seeking the adoption
of the minors Quirino Bonilla and Wilson Marcos. The case, entitled: "In re Adoption
of the Minors Quirino Bonilla and Wilson Marcos, Antero Agonoy and Amanda
Ramos-Agonoy, petitioners", was docketed therein as Spec. Proc. No. 37.

The petition was set for hearing on 24 April 1971 and notices thereof were caused
to be served upon the office of the Solicitor General and ordered published in the
ILOCOS TIMES, a weekly newspaper of general circulation in the province of Ilocos
Norte, with editorial offices in Laoag City. 3

On 22 April 1971, the minors Roderick and Rommel Daoang, assisted by their father
and guardian ad litem, the petitioners herein, filed an opposition to the
aforementioned petition for adoption, claiming that the spouses Antero and Amanda
Agonoy had a legitimate daughter named Estrella Agonoy, oppositors' mother, who
died on 1 March 1971, and therefore, said spouses were disqualified to adopt under
Art. 335 of the Civil Code. 4

The sole issue for consideration is one of law and it is whether or not the respondent
spouses Antero Agonoy and Amanda Ramos-Agonoy are disqualified to adopt under
paragraph (1), Art. 335 of the Civil Code.

The pertinent provision of law reads, as follows:

Art. 335. The following cannot adopt:

(1) Those who have legitimate, legitimated, acknowledged natural

children, or children by legal fiction;

We find, however, that the words used in paragraph (1) of Art. 335 of the Civil Code,
in enumerating the persons who cannot adopt, are clear and unambiguous. The
children mentioned therein have a clearly defined meaning in law and, as pointed
out by the respondent judge, do not include grandchildren.

Well known is the rule of statutory construction to the effect that a

statute clear and unambiguous on its face need not be interpreted; stated
otherwise, the rule is that only statutes with an ambiguous or doubtful
meaning may be the subject of statutory construction. 7

Besides, it appears that the legislator, in enacting the Civil Code of the Philippines,
obviously intended that only those persons who have certain classes of children, are
disqualified to adopt. The Civil Code of Spain, which was once in force in the
Philippines, and which served as the pattern for the Civil Code of the Philippines, in
its Article 174, disqualified persons who have legitimate or
legitimated descendants from adopting. Under this article, the spouses Antero and
Amanda Agonoy would have been disqualified to adopt as they have legitimate
grandchildren, the petitioners herein. But, when the Civil Code of the Philippines
was adopted, the word "descendants" was changed to "children", in paragraph (1)
of Article 335.

Adoption used to be for the benefit of the adoptor. It was intended to afford to
persons who have no child of their own the consolation of having one, by creating
through legal fiction, the relation of paternity and filiation where none exists by
blood relationship. (In re Adoption of Resaba, 95 Phil. 244.) The present tendency,
however, is geared more towards the promotion of the welfare of the child and the
enhancement of his opportunities for a useful and happy life, and every intendment
is sustained to promote that objective.(Santos vs. Aranzanso, 123 Phil. 160) Under
the law now in force, having legitimate, legitimated, acknowledged natural children,
or children by legal fiction, is no longer a ground for disqualification to adopt.( Child
and Welfare Code, Art. 28.)

WHEREFORE, the petition is DENIED.

Paras v. Comelec [GR 123169, 4 November 1996]

Paras v. Comelec [GR 123169, 4 November 1996]; Resolution
En Banc, Francisco (p): 14 concur

FACTS:
Danilo E. Paras is the incumbent Punong Barangay of Pula, Cabanatuan City who
won during the 1994 barangay election. A petition for his recall as Punong Barangay
was filed by the registered voters of the barangay. Acting on the petition for recall,
Comelec resolved to approve the petition, scheduled the petition signing on 14
October 1995, and set the recall election on 13 November 1995. At least 29.30% of
the registered voters signed the petition, well above the 25% requirement provided
by law. The Comelec, however, deferred the recall election in view of petitioner’s
opposition. On 6 December 1995, the Comelec set anew the recall election, this
time on 16 December 1995. To prevent the holding of the recall election, petitioner
filed before the RTC Cabanatuan City a petition for injunction (SP Civil Action 2254-
AF), with the trial court issuing a TRO. After conducting a summary hearing, the trial
court lifted the restraining order, dismissed the petition and required petitioner and
his counsel to explain why they should not be cited for contempt for
misrepresenting that the barangay recall election was without Comelec approval.

In a resolution dated 5 January 1996, the Comelec, for the third time, re-scheduled
the recall election on 13 January 1996; hence, the instant petition for certiorari with
urgent prayer for injunction. On 12 January 1996, the Court issued a TRO and
required the OSG, in behalf of Comelec, to comment on the petition. In view of the
OSG’s manifestation maintaining an opinion adverse to that of the Comelec, the
latter through its law department filed the required comment. Paras thereafter filed
a reply.
The Supreme Court dismissed the petition for having become moot and academic,
as the next regular elections are 7 months away. The TRO issued on 12 January
1996, enjoining the recall election, was made permanent.

PERTINENT LAW:

The subject provision of the Local Government Code provides:

Sec. 74. Limitations on Recall. — (a) Any elective local official may be the subject of
a recall election only once during his term of office for loss of confidence.

(b) No recall shall take place within one (1) year from the date of the official's
assumption to office or one (1) year immediately preceding a regular local election.

1. Every part of statute must be interpreted with reference to the context

of the whole enactment
It is a rule in statutory construction that every part of the statute must be
interpreted with reference to the context, i.e., that every part of the statute must be
considered together with the other parts, and kept subservient to the general intent
of the whole enactment. In the case at bar, Paragraph (b) of Section 74 construed
together with paragraph (a) merely designates the period when such elective local
official may be subject of a recall election, i.e. during the second year of his term of
office. SK elections cannot be considered a regular election as this would render
inutile the recall provision of the LGC.

2. Assumption that Legislature intended to enact an effective law

In the interpretation of a statute, the Court should start with the assumption that
the legislature intended to enact an effective law, and the legislature is not
presumed to have done a vain thing in the enactment of a statute. An interpretation
should, if possible, be avoided under which a statute or provision being construed is
defeated, or as otherwise expressed, nullified, destroyed, emasculated, repealed,
explained away, or rendered insignificant, meaningless, inoperative or nugatory.

3. Statute interpreted in harmony with the Constitution

It is a basic precept in statutory construction that a statute should be interpreted in
harmony with the Constitution. In the case at bar, the interpretation of Section 74 of
the LGC, specifically paragraph (b) thereof, should not be in conflict with the
Constitutional mandate of Section 3 of Article X of the Constitution to enact a local
government code which shall provide for a more responsive and accountable local
government structure instituted through a system of decentralization with effective
mechanisms of recall, initiative, and referendum.

4. Intent of law paramount; too literal interpretation discouraged

The spirit, rather than the letter of a law determines its construction; hence, a
statute must be read according to its spirit and intent. The too literal interpretation
of the law leads to absurdity which the Court cannot countenance. A too-literal
reading of the law constrict rather than fulfill its purpose and defeat the intention of
its authors. That intention is usually found not in ‘the letter that killeth but in the
spirit that vivifieth’.
5. Intent of the law in prohibiting recall elections for one year immediately
preceding a regular election
Recall election is potentially disruptive of the normal working of the local
government unit necessitating additional expenses, hence the prohibition against
the conduct of recall election one year immediately preceding the regular local
election. The proscription is due to the proximity of the next regular election for the
office of the local elective official concerned. The electorate could choose the
official’s replacement in the said election who certainly has a longer tenure in office
than a successor elected through a recall election. It would, therefore, be more in
keeping with the intent of the recall provision of the Code to construe regular local
election as one referring to an election where the office held by the local elective
official sought to be recalled will be contested and be filled by the electorate.

Digest: Floresca v. Philex Mining (GR L-30642, 30 April 1985)

FACTS:

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

Amici curiae submitted their respective memoranda, pursuant to the resolution of

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

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

ISSUE:
Whether the Supreme Court, in determining the action to be selective, is guilty of
judicial legislation.

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

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

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

ISSUE:
Whether opposing or conflicting personalities should be construed as psychological
incapacity

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

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

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

The Supreme Court granted the petition, and reversed and set aside the assailed
decision; concluding that the marriage of Roridel Olaviano to Reynaldo Molina
subsists and remains valid.
Digest: Aisporna v. CA (GR L-39419, 12 April 1982)

Posted by Berne Guerrero under (a) oas , digests

Aisporna v. CA
GR L-39419, 12 April 1982 (113 SCRA 459)
First Division, de Castro (p): 5 concur, 1 took no part

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

For reason unexplained, an information was filed against Mapalad Aisporna,

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

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

Held: Legislative intent must be ascertained from a consideration of the statute as

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

The Supreme Court reversed the appealed judgment and acquitted the accused of
the crime charged, with costs de oficio.
Haystack: Aisporna v. CA [GR L-39419, 12 April 1982]

Posted by Berne Guerrero under (a) oas , haystacks

Aisporna v. CA [GR L-39419, 12 April 1982]

First Division, de Castro (p): 5 concur, 1 took no part

Facts: Since 7 March and on 21 June 1969, a Personal Accident Policy was issued
by Perla Compania de Seguros, through its authorized agent Rodolfo Aisporna, for a
period of 12 months with the beneficiary designated as Ana M. Isidro. The insured
died by violence during lifetime of policy. Mapalad Aisporna participated actively
with the aforementioned policy. For reason unexplained, an information was filed
against Mapalad Aisporna, Rodolfo’s wife, with the City Court of Cabanatuan for
violation of Section 189 of the Insurance Act on 21 November 1970, or acting as an
agent in the soliciting insurance without securing the certificate of authority from
the office of the Insurance Commissioner. Mapalad contends that being the wife of
true agent, Rodolfo, she naturally helped him in his work, as clerk, and that policy
was merely a renewal and was issued because Isidro had called by telephone to
renew, and at that time, her husband, Rodolfo, was absent and so she left a note on
top of her husband’s desk to renew. On 2 August 1971, the trial court found
Mapalad guilty and sentenced here to pay a fine of P500.00 with subsidiary
imprisonment in case of insolvency and to pay the costs.

On appeal and on 14 August 1974, the trial court’s decision was affirmed by the
appellate court (CA-GR 13243-CR) finding the Aisporna guilty of a violation of the
first paragraph of Section 189 of the Insurance Act. Hence, the present recourse
was filed on 22 October 1974. In its 28 October 1974 resolution the Court resolved,
without giving due course to this instant petition, to require the respondent to
comment on the aforesaid petition. In the comment filed on 20 December 1974,
the OSG, representing the CA, submitted that Aisporna may not be considered as
having violated Section 189 of the Insurance Act. On 3 April 1975, Aisporna
submitted his Brief while the Solicitor General filed a manifestation in lieu of a Brief
on 3 May 1975 reiterating his stand that Aisporna has not violated Section 189 of
the Insurance Act.

The Supreme Court reversed the appealed judgment and acquitted the accused of
the crime charged, with costs de oficio.

1. Scope of the law; Definition of Insurance Agent

The first paragraph of Section 189 prohibits a person from acting as agent,
subagent or broker in the solicitation or procurement of applications for insurance
without first procuring a certificate of authority so to act from the Insurance
Commissioner; second paragraph defines who is an insurance agent within the
intent of this section; and, third paragraph prescribes the penalty to be imposed for
its violation. In the case at bar, the appellate court ruled that the petitioner is
prosecuted not under the second paragraph of Section 189 but under its first
paragraph. This was a reversible error as the definition of insurance agent in
paragraph 2 applies to the paragraph 1 and 2 of Section 189, to wit “Any person
who for compensation shall be an insurance agent within the intent of this section.”

2. Legislative intent must be ascertained from a consideration of the

statute as a whole; Doctrine of Noscitur a Sociis
Legislative intent must be ascertained from a consideration of the statute as a
whole. The particular words, clauses and phrases should not be studied as detached
and isolated expressions, but the whole and every part of the statute must be
considered in fixing the meaning of any of its parts and in order to produce
harmonious whole. A statute must be so construed as to harmonize and give effect
to all its provisions whenever possible. The meaning of the law, it must be borne in
mind, is not to be extracted from any single part, portion or section or from isolated
words and phrases, clauses or sentences but from a general consideration or view
of the act as a whole. Every part of the statute must be interpreted with reference
to the context. This means that every part of the statute must be considered
together with the other parts, and kept subservient to the general intent of the
whole enactment, not separately and independently.
The doctrine of associated words (Noscitur a Sociis) provides that where a particular
word or phrase in a statement is ambiguous in itself or is equally susceptible of
various meanings, its true meaning may be made clear and specific by considering
the company in which it is found or with which it is associated.

3. Every element of the crime must be alleged and proved to warrant

conviction
A law making it a misdemeanor for any person for direct or indirect compensation to
solicit insurance without a certificate of authority to act as an insurance agent, an
information, failing to allege that the solicitor was to receive compensation either
directly or indirectly, charges no offense. In the case at bar, the information does
not allege that the negotiation of an insurance contract by the accused with
Eugenio Isidro was one for compensation. This allegation is essential, and having
been omitted, a conviction of the accused could not be sustained. To warrant
conviction, every element of the crime must be alleged and proved.

Digest: China Bank v. Ortega (GR L-34964, 31 January 1973)

Posted by Berne Guerrero under (a) oas , digests

China Bank v. Ortega (J)

GR L-34964, 31 January 1973 (49 SCRA 355)
Second Division, Makalintal (p): 7 concur, 2 took no part

Facts: On 17 December 1968, Vicente Acaban filed a complaint against B & B

Forest Development Corporation and Mariano Bautista for the collection of sum of
money. The trial court declared the defendants in default for failure to answer
within the reglementary period, and rendered its decision on 20 January 1970.
To satisfy the judgment, Acaban sought the garnishment of the bank deposit of B &
B Forest Development Corporation with the China Bank. However, Tan Kim Liong,
the bank’s cashier, disallowed the same invoking the provisions of Republic Act
1405, which prohibit the disclosure of any information relative to bank deposits. On
4 March 1972, Tan Kim Lion was ordered to inform the Court if there is a deposit by
B & B Forest Development in the China Bank, and if there is, to hold the same intact
and not allow any withdrawal until further order from the Court. Tan Kim Liong
moved to reconsider but was turned down. In the same order he was directed to
comply with the order of the Court, otherwise his arrest and confinement will be
ordered. Resisting the 2 orders, the China Bank and Tan Kim Liong instituted the
petition. Petitioners argue that the disclosure of the information required by the
court does not fall within any of the four (4) exceptions enumerated in Section 2 ([1]
upon written permission of the depositor, [2] or in cases of impeachment, [3] or
upon order of a competent court in cases of bribery or dereliction of duty of public
officials, [4] or in cases where the money deposited or invested is the subject
matter of the litigation), and that if the questioned orders are complied with Tan
Kim Liong may be criminally liable under Section 5 and the bank exposed to a
possible damage suit by B & B Forest Development Corporation. Specifically
referring to the case, the position of the petitioners is that bank deposit of judgment
debtor B and B Forest Development Corporation cannot be subject to garnishment
to satisfy a final judgment against it in view of the aforementioned provisions of
law.

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

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

The Supreme Court affirmed the orders of the lower court dated 4 and 27 March
1972, with costs against the petitioners.
Digest: Board of Administrators of the PVA v. Bautista (GR L-37867, 22
February 1982)

Posted by Berne Guerrero under digests

Board of Administrators of the PVA v. Bautista

GR L-37867, 22 February 1982 (112 SRCA 59)
First Division, Guerrero (p): 5 concurring

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

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

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

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

Held: As it is generally known, the purpose of Congress in granting veteran

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

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