TITLE: Tanada v Tuvera CITATION: L-63915, April 24, 1985| 136 SCRA 27

FACTS: Petitioners seek a writ of mandamus in compelling respondent public officials to publish and/ or cause the publication in the Official Gazette of various presidential decrees, letter of instructions, general orders, proclamations, executive orders, letter of implementation and administrative orders. The general rule in seeking writ of mandamus is that it would be granted to a private individual only in those cases where he has some private or particular interest to be subserved, or some particular right to be protected, independent of that which he holds with the public at large," and "it is for the public officers exclusively to apply for the writ when public rights are to be subserved. The legal capacity of a private citizen was recognized by court to make the said petition for the reason that the right sought to be enforced by petitioners herein is a public right recognized by no less than the fundamental law of the land. ISSUE: Whether publication in the Official Gazette is still required considering the clause in Article 2 unless otherwise provided. HELD: Unless it is otherwise provided refers to the date of effectivity and not with the publication requirement which cannot be omitted as public needs to be notified for the law to become effective. The necessity for the publication in the Official Gazette of all unpublished presidential issuances which are of general application, was affirmed by the court on April 24, 1985. This is necessary to provide the general public adequate notice of the various laws which regulate actions and conduct as citizens. Without this, there would be no basis for Art 3 of the Civil Code Ignorance of the law excuses no one from compliance therewith. WHEREFORE, the Court hereby orders respondents to publish in the Official Gazette all unpublished presidential issuances which are of general application, and unless so published, they shall have no binding force and effect.

People vs. Que Po Lay | Montemayor Keywords: [publication] FACTS Que Po Lay (Que) was charged of violating Central Bank Circular No. 20 for failing to sell foreign exchange in his possession consisting of U.S. dollars, U.S. checks, and U.S. money orders amounting to $7,000 to the Central Bank within one day from the receipt of such foreign exchange. The trial court found him guilty. Hence, this appeal where Que contends that Circular No. 20 had no force and effect because it was not published in the Official Gazette, prior to the act or omission imputed to him. ISSUES/HELD Should the circular have been published to produce legal effects? YES. JUDGMENT REVERSED. RATIONALE It is true that Circular No. 20 of the Central Bank is not a statute or law but being issued for the implementation of the law authorizing its issuance, it has the force and effect of law according to settled jurisprudence. Thus, it has to comply with the requirements of publication of a statute before it may take effect as mandated by Section 11 of the Revised Administrative Code and Art. 2 of the Civil Code. Moreover, as a rule, circulars and regulations which prescribe a penalty for their violation should be published before becoming effective; this is on the general principle and theory that before the public is bound by its contents, especially its penal provisions, a law, regulation, or circular must first be published and the people officially and specifically informed of said contents and its penalties. It is clear that Circular No. 20 did not have any legal effect and bound no one until its publication in the Official Gazette or after November 1951. Thus, Que could not be held liable for its violation for it was not binding at the time he was found to have failed to sell the foreign exchange in his possession within one day following his taking possession thereof. Although this issue was only raised for the first time on appeal, it may still be considered because the court may be said to have had no jurisdiction when it rendered a judgment finding Que guilty of violating Circular No. 20 which, in the eyes of the law, was not in existence for not having been published.

Republic of the Philippines SUPREME COURT Manila EN BANC Adm. Matter No. 2268-MJ November 7, 1980 RICARDO ESCARDA, complainant, vs. Judge JACINTO MANALO of Coron, Palawan, respondent. FERNANDO, C.J.: This administrative complaint for improper conduct by complainant Ricardo Escarda against respondent Municipal Judge Jacinto Manalo of Coron, Palawan affords this Court an opportunity to set forth the guiding principle as to 1 when the Lupon Tagapayapa under the Katarungan Pambarangay Decree should take cognizance of a case. Respondent Judge refused the referral of a complaint for slight physical injuries to the Lupon Tagapayapa. That was the basis of this charge against him. As the Decree was intended to remedy the clogged state of the dockets through the amicable settlement of minor disputes relying on what was aptly referred to by President Marcos as "the good sense and civic spirit of our citizenry and our community leaders," respondent Judge should be held accountable, if, 2 as alleged, he did not comply with its provisions. His refusal, however, finds support in Circular No. 12 of the late 3 Chief Justice Castro, as amended by Circular No. 22. It reads as follows,. "Effective upon your receipt of the certification by the Minister of Local Government and Community Development that an the barangays within your respective jurisdictions have organized their Lupons provided for in Presidential Decree No. 1508, otherwise known as the Katarungang Pambarangay Law, in implementation of the barangay system of settlement of disputes, you are hereby directed to desist from receiving complaints, petitions, actions or proceedings in cases falling within the authority of said Lupons. Circular No. 12 dated October 30, 1978, issued by the late Chief Justice Fred Ruiz Castro is 4 to that extent modified."

Circular No. 22 was noted in a Letter of Implementation of President Ferdinand E. Marcos, dated November 12, 1979, the first paragraph of which reads as follows: "with a view to easing up the log-jam of cases and solving the problem of backlogs in the case of dockets of an government offices involved in the investigation, trial and adjudication of cases, it is hereby ordered that immediate implementation be made by all government officials and offices concerned of the system of amicably settling disputes at the barangay level as provided for in the 6 Katarungang Pambarangay Law (Presidential Decree No. 1508)." It then ordered "effective compliance" with certain 7 directives one of which is the aforesaid Circular No. 22. Then came this paragraph: "For this purpose, all City and Municipal Development Officers of the Ministry of Local Government and Community Development are hereby ordered to certify the fact of organization of the Lupong Tagapayapa in their respective barangays within five (5) days from the publication of this order, and to send such certification to the Ministry of Justice and the Supreme Court, as 8 well as to the fiscals and judges concerned." Prior to such certification of the organization of the Lupon Tagapayapa then, a municipal judge must comply with the Rules of Court applicable to any complaint or judicial proceeding properly cognizable by him. That is his bounden duty. Since there is no question as to the particular case of physical injuries falling within the jurisdiction of respondent Judge, he acted in accordance with law. As noted in the memorandum of Court Administrator Relova: "In the case at bar, Criminal Case No. 2041 was filed before any such 9 certification. Therefore, respondent need not refer the case to the barangay captain or the Lupon." The complaint for improper judicial conduct is therefore without merit. Accordingly, it should be dismissed. As mentioned at the outset of this opinion, this resolution is intended to provide guidance for the actuation of the judges concerned, more specifically as to the date when in accordance with Presidential Decree No. 1508 the system of conciliation provide ed for therein should be followed before the judiciary could act on the matter. WHEREFORE, this administrative complaint is dismissed for lack of merit. Let a copy of this resolution be spread on the record of respondent Judge Jacinto Manalo. Teehankee, Barredo, Makasiar, Aquino, Concepcion, Jr., Fernandez, Guerrero, Abad Santos, De Castro and Melencio-Herrera, JJ., concur.

PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS, INC. petitioner, vs. HON. RUBEN D. TORRES, as Secretary of the Department of Labor & Employment, and JOSE N. SARMIENTO, as Administrator of the PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION, respondents. [G.R. No. 101279. August 6, 1992.] FACTS: DOLE Secretary Ruben D. Torres issued Department Order No. 16 Series of 1991 temporarily suspending the recruitment by private employment agencies of Filipino domestic helpers going to Hong Kong. As a result of the department order DOLE, through the POEA took over the business of deploying Hong Kong bound workers. The petitioner, PASEI, the largest organization of private employment and recruitment agencies duly licensed and authorized by the POEA to engage in the business of obtaining overseas employment for Filipino land-based workers filed a petition for prohibition to annul the aforementioned order and to prohibit implementation. ISSUES: 1. whether or not respondents acted with grave abuse of discretion and/or in excess of their rulemaking authority in issuing said circulars; 2. whether or not the assailed DOLE and POEA circulars are contrary to the Constitution, are unreasonable, unfair and oppressive; and 3. whether or not the requirements of publication and filing with the Office of the National Administrative Register were not complied with. HELD: FIRST, the respondents acted well within in their authority and did not commit grave abuse of discretion. This is because Article 36 (LC) clearly grants the Labor Secretary to restrict and regulate recruitment and placement activities, to wit: Art. 36. Regulatory Power. The Secretary of Labor shall have the power to restrict and regulate the recruitment and placement activities of all agencies within the coverage of this title [Regulation of Recruitment and Placement Activities] and is hereby authorized to issue orders and promulgate rules and regulations to carry out the objectives and implement the provisions of this title. SECOND, the vesture of quasi-legislative and quasi-judicial powers in administrative bodies is constitutional. It is necessitated by the growing complexities of the modern society. THIRD, the orders and circulars issued are however, invalid and unenforceable. The reason is the lack of proper publication and filing in the Office of the National Administrative Registrar as required in Article 2 of the Civil Code to wit: Art. 2. Laws shall take effect after fifteen (15) days following the completion of their publication in the Official Gazatte, unless it is otherwise provided; Article 5 of the Labor Code to wit: Art. 5. Rules and Regulations. The Department of Labor and other government agencies charged with the administration and enforcement of this Code or any of its parts shall promulgate the necessary implementing rules and regulations. Such rules and regulations shall become effective fifteen (15) days after announcement of their adoption in newspapers of general circulation; and Sections 3(1) and 4, Chapter 2, Book VII of the Administrative Code of 1987 which provide: Sec. 3. Filing. (1) Every agency shall file with the University of the Philippines Law Center, three (3) certified copies of every rule adopted by it. Rules in force on the date of effectivity of this Code which are not filed within three (3) months shall not thereafter be the basis of any sanction against any party or persons. (Chapter 2, Book VII of the Administrative Code of 1987.) Sec. 4. Effectivity. In addition to other rule-making requirements provided by law not inconsistent with this Book, each rule shall become effective fifteen (15) days from the date of filing as above provided unless a different date is fixed by law, or specified in the rule in cases of imminent danger to public health, safety and welfare, the existence of which must be expressed in a statement accompanying the rule. The agency shall take appropriate measures to make emergency rules known to persons who may be affected by them. (Chapter 2, Book VII of the Administrative Code of 1987). Prohibition granted.

PHIL. ASS. OF SERVICE EXPORTERS, INC. vs. RUBEN D. TORRES, ET AL. G.R. No. 101279 August 6, 1992 Prepared by: Arnel D. Mateo Facts: Philippine Association of Service Exporters (PASEI, for short), is the largest national organization of private employment and recruitment agencies duly licensed and authorized by the POEA, to engaged in the business of obtaining overseas employment for Filipino landbased workers, including domestic helpers. On June 1, 1991, as a result of published stories regarding the abuses suffered by Filipino housemaids employed in Hong Kong, DOLE Secretary Ruben D. Torres issued Department Order No. 16, Series of 1991, temporarily suspending the recruitment by private employment agencies of "Filipino domestic helpers going to Hong Kong". Pursuant to the above DOLE circular, the POEA issued Memorandum Circular No. 30, Series of 1991, dated July 10, 1991, providing GUIDELINES on the Government processing and deployment of Filipino domestic helpers to Hong Kong and the accreditation of Hong Kong recruitment agencies intending to hire Filipino domestic helpers. On August 1, 1991, the POEA Administrator also issued Memorandum Circular No. 37, Series of 1991, on the processing of employment contracts of domestic workers for Hong Kong. All Hong Kong recruitment agent/s hiring DHs from the Philippines shall recruit under the new scheme which requires prior accreditation which the POEA.

On September 2, 1991, the petitioner, PASEI, filed this petition for prohibition to annul the aforementioned DOLE and POEA circulars and to prohibit their implementation Issue: WON the respondents acted with grave abuse of discretion and/or in excess of their rulemaking authority in issuing said circulars. Ruling: No. Article 36 of the Labor Code grants the Labor Secretary the power to restrict and regulate recruitment and placement activities. On the other hand, the scope of the regulatory authority of the POEA, which was created by Executive Order No. 797 on May 1, 1982 to take over the functions of the Overseas Employment Development Board, the National Seamen Board, and the overseas employment functions of the Bureau of Employment Services, is broad and far-ranging. The assailed circulars do not prohibit the petitioner from engaging in the recruitment and deployment of Filipino landbased workers for overseas employment. A careful reading of the challenged administrative issuances discloses that the same fall within the "administrative and policing powers expressly or by necessary implication conferred" upon the respondents. Nevertheless, they are legally invalid, defective and unenforceable for lack of power publication and filing in the Office of the National Administrative Register as required in Article 2 of the Civil Code, Article 5 of the Labor Code and Sections 3(1) and 4, Chapter 2, Book VII of the Administrative Code of 1987. The administrative circulars in question may not be enforced and implemented.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. L-46158 November 28, 1986 TAYUG RURAL BANK, plaintiff-appellee, vs. CENTRAL BANK OF THE PHILIPPINES, defendant-appellant. Bengzon, Bengzon, Villaroman & De Vera Law Office for plaintiff-appellee. Evangelista, Bautista & Valdehuesa Law Office for defendant-appellant.

PARAS, J.:p Submitted on May 20, 1977 for decision by this Court is this appeal from the decision dated January 6, 1971 rendered by the Court of First Instance of Manila, Branch III in Civil Case No. 76920, the decretal portion of which states as follows: WHEREFORE, judgment is rendered for the plaintiff on the complaint and the defendant is ordered to further credit the plaintiff the amounts collected as 10% penalty in the sum of P19,335.88 or up to July 15, 1969 and to refrain from collecting the said 10% penalty on the remaining past due loans of plaintiff with the defendant. With respect to defendant's counterclaim, judgment is hereby rendered against the plaintiff and the defendant is ordered to pay the Central Bank of the Philippines the outstanding balance of its past overdue accounts in the sum of P444,809,45 plus accrued interest at the rate of 1/2 of 1 % per annum with respect to the promissory notes (Annexes 1 to 1-E of defendant's Answer) and 21/2% per annum with respect to the promissory notes (Annexes 1-f to 1-i of the Answer). From this amount shall be deducted the sum of P19,335.88 collected as 10% penalty. The facts of the case based on the parties' stipulation of facts (Record on Appeal p. 67), are as follows: Plaintiff-Appellee, Tayug Rural Bank, Inc., is a banking corporation in Tayug, Pangasinan. During the period from December 28, 1962 to July 30, 1963, it obtained thirteen (13) loans from Defendant-Appellant, Central Bank of the Philippines, by way of rediscounting, at the rate of 1/2 of 1% per annum from 1962 to March 28, 1963 and thereafter at the rate of 2-1/2% per anum. The loans, amounting to P813,000.00 as of July 30, 1963, were all covered by corresponding promissory notes prescribing the terms and conditions of the aforesaid loans (Record on Appea, pp. 15-53). As of July 15, 1969, the outstanding balance was P 444,809.45 (Record on Appeal, p. 56). On December 23, 1964, Appellant, thru the Director of the Department of Loans and Credit, issued Memorandum Circular No. DLC-8, informing all rural banks that an additional penalty interest rate of ten per cent (10%) per annum would be assessed on all past due loans beginning January 4, 1965. Said Memorandum Circular was actually enforced on all rural banks effective July 4, 1965. On June 27, 1969, Appellee Rural Bank sued Appellant in the Court of First Instance of Manila, Branch III, to recover the 10% penalty imposed by Appellant amounting to P16,874.97, as of September 27, 1968 and to restrain Appellant from continuing the imposition of the penalty. Appellant filed a counterclaim for the outstanding balance and overdue accounts of Appellee in the total amount of P444,809.45 plus accrued interest and penalty at 10% per annum on the outstanding balance until full payment. (Record on Appeal, p. 13). Appellant justified the imposition of the penalty by way of affirmative and special defenses, stating that it was legally imposed under the provisions of Section 147 and 148 of the Rules and Regulations Governing Rural Banks promulgated by the Monetary Board on September 5, 1958, under authority of Section 3 of Republic Act No. 720, as amended (Record on Appeal, p. 8, Affirmative and Special Defenses Nos. 2 and 3).

In its answer to the counterclaim, Appellee prayed for the dismissal of the counterclaim, denying Appellant's allegations stating that if Appellee has any unpaid obligations with Appellant, it was due to the latter's fault on account of its flexible and double standard policy in the granting of rediscounting privileges to Appellee and its subsequent arbitrary and illegal imposition of the 10% penalty (Record on Appeal, p. 57). In its Memorandum filed on November 11, 1970, Appellee also asserts that Appellant had no basis to impose the penalty interest inasmuch as the promissory notes covering the loans executed by Appellee in favor of Appellants do not provide for penalty interest rate of 10% per annum on just due loans beginning January 4, 1965 (Record on Appeal p. 96). The lower court, in its Order dated March 3, 1970, stated that "only a legal question has been raised in the pleadings" and upholding the stand of plaintiff Rural Bank, decided the case in its favor. (Rollo, p. 34). Appellant appealed the decision of the trial court to the Court of Appeals, for determination of questions of facts and of law. However, in its decision promulgated April 13, 1977, the Court of Appeals, finding no controverted facts and taking note of the statement of the lower court in its pre-trial Order dated March 3, 1970 that only a legal question has been raised in the pleadings, (Record on Appeal, p. 61), ruled that the resolution of the appeal will solely depend on the legal issue of whether or not the Monetary Board had authority to authorize Appellant Central Bank to impose a penalty rate of 10% per annum on past due loans of rural banks which had failed to pay their accounts on time and ordered the certification of this case to this Court for proper determination (Rollo, pp. 34-35). On April 20, 1977, the entire record of the case was forwarded to this Court (Rollo, p. 36). In the resolution of May 20, 1977, the First Division of this Court, ordered the case docketed and as already stated declared the same submitted for decision (Rollo, p. 38). In its Brief, Appellant assigns the following errors: I. THE LOWER COURT ERRED IN HOLDING THAT IT IS BEYOND THE REACH OF THE MONETARY BOARD TO METE OUT PENALTIES ON PAST DUE LOANS OF RURAL BANKS ESPECIALLY SINCE NO PENAL CLAUSE HAS BEEN INCLUDED IN THE PROMISSORY NOTES. II. THE LOWER COURT ERRED IN HOLDING THAT THE IMPOSITION OF THE PENALTY IS AN IMPAIRMENT OF THE OBLIGATION OF CONTRACT WITHOUT DUE PROCESS. III. THE LOWER COURT ERRED IN NOT FINDING JUDGMENT AGAINST PLAINTIFF FOR 10% COST OF COLLECTION OF THE PROMISSORY NOTE AS PROVIDED THEREIN. It is undisputed that no penal clause has been included in the promissory notes. For this reason, the trial court is of the view that Memorandum Circular DLC-8 issued on December 23, 1964 prescribing retroactive effect on all past due loans, impairs the obligation of contract and deprives the plaintiff of its property without due process of law. (Record on Appel, p. 40). On the other hand appellant without opposing appellee's right against impairment of contracts, contends that when the promissory notes were signed by appellee, it was chargeable with knowledge of Sections 147 and 148 of the rules and regulations authorizing the Central Bank to impose additional reasonable penalties, which became part of the agreement. (ibid). Accordingly, the issue is reduced to the sole question as to whether or not the Central Bank can validly impose the 10% penalty on Appellee's past overdue loans beginning July 4, 1965, by virtue of Memorandum Circular No. DLC-8 dated December 23, 1964. The answer is in the negative. Memorandum Circular No. DLC-8 issued by the Director of Appellant's Department of Loans and Credit on December 23, 1964, reads as follows: Pursuant to Monetary Board Resolution No. 1813 dated December 18, 1964, and in consonance with Section 147 and 148 of the Rules and Regulations Governing Rural Banks concerning the responsibility of a rural bank to remit immediately to the Central Bank payments received on

papers rediscounted with the latter including the loan value of rediscounted papers as they mature, and to liquidate fully its maturing loan obligations with the Central Bank, personal checks, for purposes of repayment, shall considered only after such personal checks shall have been honored at clearing. In addition, rural banks which shall default in their loan obligations, thus incurring past due accounts with the Central Bank, shall be assessed an additional penalty interest rate of ten per cent (10%) per annum on such past due accounts with the Central Bank over and above the customary interest rate(s) at which such loans were originally secured from the Central Bank. (Record on Appeal, p. 135). The above-quoted Memorandum Circular was issued on the basis of Sections 147 and 148 of the Rules and Regulations Governing Rural Banks of the Philippines approved on September 5, 1958, which provide: Section 147. Duty of Rural Bank to turn over payment received for papers discounted or used for collateral. A Rural Bank receiving any payment on account of papers discounted or used for collateral must turn the same over to the creditor bank before the close of the banking day next following the receipt of payment, as long as the aggregate discounting on loan amount is not fully paid, unless the Rural Bank substitutes the same with another eligible paper with at least the same or earlier maturity and the same or greater value. A Rural Bank failing to comply with the provisions of the preceding paragraph shall ipso facto lose its right to the rediscounting or loan period, without prejudice to the Central Bank imposing additional reasonable penalties, including curtailment or withdrawal of financial assistance. Sec. 148. Default and other violations of obligation by Rural Bank, effect. A Rural Bank becomes in default upon the expiration of the maturity period of its note, or that of the papers discounted or used as collateral, without the necessity of demand. A Rural Bank incurring default, or in any other manner, violating any of the stipulations in its note, shall suffer the consequences provided in the second paragraph of the preceding section. (Record on Appeal, p. 136.) The "Rules and Regulations Governing Rural Banks" was published in the Official Gazette, 55 O.G., on June 13, 1959, pp. 5186-5289. It is by virtue of these same Rules that Rural Banks re-discount their loan papers with the Central Bank at 2-1/2% interest per annum and in turn lend the money to the public at 12% interest per annum (Defendant's Reply to Plaintiff's Memorandum, Record on Appeal, p. 130). Appellant maintains that it is pursuant to Section 3 of R.A. No. 720, as amended, that the Monetary Board has adopted the set of Rules and Regulations Governing Rural Banks. It reads: SEC. 3. In furtherance of this policy, the Monetary Board of the Central Bank of the Philippines shall formulate the necessary rules and regulations governing the establishment and operatives of Rural Banks for the purpose of providing adequate credit facilities to small farmers and merchants, or to cooperatives of such farmers or merchants and to supervise the operation of such banks. The specific provision under the law claimed as basis for Sections 147 and 148 of the Rules and Regulations Governing Rural Banks, that is, on Appellant's authority to extend loans to Rural Banks by way of rediscounting is Section 13 of R.A. 720, as amended, which provides: SEC. 13. In an emergency or when a financial crisis is imminent the Central Bank may give a loan to any Rural Bank against assets of the Rural Bank which may be considered acceptable by a concurrent vote of at least, five members of the Monetary Board. In normal times, the Central Bank may re-discount against papers evidencing a loan granted by a Rural Bank to any of its customers which can be liquefied within a period of two hundred and seventy days: PROVIDED, HOWEVER, That for the purpose of implementing a nationwide program of agricultural and industrial development, Rural Banks are hereby authorized under such terms and conditions as the Central Bank shall prescribe to borrow on a medium or long term basis, funds that the Central Bank or any other government financing institutions shall

borrow from the International Bank for Reconstruction and Development or other international or foreign lending institutions for the specific purpose of financing the above stated agricultural and industrial program. Repayment of loans obtained by the Central Bank of the Philippines or any other government financing institution from said foreign lending institutions under this section shall be guaranteed by the Republic of the Philippines. As to the supervising authority of the Monetary Board of the Central Bank over Rural Banks, the same is spelledout under Section 10 of R.A. 720, as follows: SEC. 10. The power to supervise the operation of any Rural Bank by the Monetary Board of the Central Bank as herein indicated, shall consist in placing limits to the maximum credit allowed any individual borrower; in prescribing the interest rate; in determining the loan period and loan procedure; in indicating the manner in which technical assistance shall be extended to Rural Banks; in imposing a uniform accounting system and manner of keeping the accounts and records of the Rural Banks; in undertaking regular credit examination of the Rural Banks: in instituting periodic surveys of loan and lending procedures, audits, test check of cash and other transactions of the Rural Banks; in conducting training courses for personnel of Rural Banks; and, in general in supervising the business operation of the Rural Banks. Nowhere in any of the above-quoted pertinent provisions of R.A. 720 nor in any other provision of R.A. 720 for that matter, is the monetary Board authorized to mete out on rural banks an additional penalty rate on their past due accounts with Appellant. As correctly stated by the trial court, while the Monetary Board possesses broad supervisory powers, nonetheless, the retroactive imposition of administrative penalties cannot be taken as a measure supervisory in character. (Record on Appeal, p. 141). Administrative rules and regulations have the force and effect of law (Valerio v. Hon. Secretary of Agriculture and Natural Resources, 7 SCRA 719; Commissioner of Civil Service v. Cruz, 15 SCRA 638; R.B. Industrial Development Company, Ltd. v. Enage, 24 SCRA 365; Director of Forestry v. Munoz, 23 SCRA 1183; Gonzalo Sy v. Central Bank of the Philippines, 70 SCRA 570). There are, however, limitations to the rule-making power of administrative agencies. A rule shaped out by jurisprudence is that when Congress authorizes promulgation of administrative rules and regulations to implement given legislation, all that is required is that the regulation be not in contradiction with it, but conform to the standards that the law prescribes (Director of Forestry v. Munoz, 23 SCRA 1183). The rule delineating the extent of the binding force to be given to administrative rules and regulations was explained by the Court in Teoxon v. Member of the Board of Administrators (33 SCRA 588), thus: "The recognition of the power of administrative officials to promulgate rules in the implementation of the statute, as necessarily limited to what is provided for in the legislative enactment, may be found as early as 1908 in the case of United States v. Barrias (11 Phil. 327) in 1914 U.S. v. Tupasi Molina (29 Phil. 119), in 1936 People v. Santos (63 Phil. 300), in 1951 Chinese Flour Importers Ass. v. Price Stabilization Board (89 Phil. 439), and in 1962 Victorias Milling Co., Inc. v. Social Security Commission (4 SCRA 627). The Court held in the same case that "A rule is binding on the courts so long as the procedure fixed for its promulgation is followed and its scope is within the statute granted by the legislature, even if the courts are not in agreement with the policy stated therein or its innate wisdom ...." On the other hand, "administrative interpretation of the law is at best merely advisory, for it is the courts that finally determine what the law means." Indeed, it cannot be otherwise as the Constitution limits the authority of the President, in whom all executive power resides, to take care that the laws be faithfully executed. No lesser administrative, executive office, or agency then can, contrary to the express language of the Constitution, assert for itself a more extensive prerogative. Necessarily, it is bound to observe the constitutional mandate. There must be strict compliance with the legislative enactment. The rule has prevailed over the years, the latest restatement of which was made by the Court in the case of Bautista v. Junio (L-50908, January 31, 1984, 127 SCRA 342). In case of discrepancy between the basic law and a rule or regulation issued to implement said law, the basic law prevails because said rule or regulation cannot go beyond the terms and provisions of the basic law (People v. Lim, 108 Phil. 1091). Rules that subvert the statute cannot be sanctioned (University of St. Tomas v. Board of Tax Appeals, 93 Phil. 376; Del Mar v. Phil. Veterans Administration, 51 SCRA 340). Except for constitutional officials who can trace their competence to act to the fundamental law itself, a public official must locate in the statute relied upon a grant of power before he can exercise it. Department zeal may not be permitted to outrun the authority conferred by statute (Radio Communications of the Philippines, Inc. v. Santiago, L-29236, August 21, 1974, 58 SCRA 493). When promulgated in pursuance of the procedure or authority conferred upon the administrative agency by law, the rules and regulations partake of the nature of a statute, and compliance therewith may be enforced by a penal sanction provided in the law (Victorias Milling Co., Inc. v. Social Security Commission, 114 Phil. 555; People v.

Maceren, L-32166, October 18, 1977, 79 SCRA 462; Daza v. Republic, L-43276, September 28, 1984, 132 SCRA 267). Conversely, the rule is likewise clear. Hence an administrative agency cannot impose a penalty not so provided in the law authorizing the promulgation of the rules and regulations, much less one that is applied retroactively. The records show that DLC Form No. 11 (Folder of Exhibits, p. 16) was revised December 23, 1964 to include the penal clause, as follows: In the event that this note becomes past due, the undersigned shall pay a penalty at the rate of _____ per cent ( ) per annum on such past due account over and above the interest rate at which such loan was originally secured from the Central Bank. Such clause was not a part of the promissory notes executed by Appellee to secure its loans. Appellant inserted the clause in the revised DLC Form No. 11 to make it a part of the contractual obligation of rural banks securing loans from the Central Bank, after December 23, 1964. Thus, while there is now a basis for the imposition of the 10% penalty rate on overdue accounts of rural banks, there was none during the period that Appellee contracted its loans from Appellant, the last of which loan was on July 30, 1963. Surely, the rule cannot be given retroactive effect. Finally, on March 31, 1970, the Monetary Board in its Resolution No. 475 effective April 1, 1970, revoked its Resolution No. 1813, dated December 18, 1964 imposing the questioned 10% per annum penalty rate on past due loans of rural banks and amended sub-paragraph (a), Section 10 of the existing guidelines governing rural banks' applications for a loan or rediscount, dated May 7, 1969 (Folder of Exhibits, p. 19). As stated by the trial court, this move on the part of the Monetary Board clearly shows an admission that it has no power to impose the 10% penalty interest through its rules and regulations but only through the terms and conditions of the promissory notes executed by the borrowing rural banks. Appellant evidently hoped that the defect could be adequately accomplished by the revision of DLC Form No. 11. The contention that Appellant is entitled to the 10% cost of collection in case of suit and should therefore, have been awarded the same by the court below, is well taken. It is provided in all the promissory notes signed by Appellee that in case of suit for the collection of the amount of the note or any unpaid balance thereof, the Appellee Rural Bank shall pay the Central Bank of the Philippines a sum equivalent to ten (10%) per cent of the amount unpaid not in any case less than five hundred (P500.00) pesos as attorney's fees and costs of suit and collection. Thus, Appellee cannot be allowed to come to Court seeking redress for an wrong done against it and then be allowed to renege on its corresponding obligations. PREMISES CONSIDERED, the decision of the trial court is hereby AFFIRMED with modification that Appellee Rural Bank is ordered to pay a sum equivalent to 10% of the outstanding balance of its past overdue accounts, but not in any case less than P500.00 as attorney's fees and costs of suit and collection. SO ORDERED. Feria (Chairman), Fernan, Alampay and Gutierrez, Jr., JJ., concur.

Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-6339 April 20, 1954

MANUEL LARA, ET AL., plaintiffs-appellants, vs. PETRONILO DEL ROSARIO, JR., defendant-appellee. Manansala and Manansala for appellants. Ramon L. Resurreccion for appellee. MONTEMAYOR, J.: In 1950 defendant Petronilo del Rosario, Jr., owner of twenty-five taxi cabs or cars, operated a taxi business under the name of "Waval Taxi." He employed among others three mechanics and 49 chauffeurs or drivers, the latter having worked for periods ranging from 2 to 37 months. On September 4, 1950, without giving said mechanics and chauffeurs 30 days advance notice, Del Rosario sold his 25 units or cabs to La Mallorca, a transportation company, as a result of which, according to the mechanics and chauffeurs above-mentioned they lost their jobs because the La Mallorca failed to continue them in their employment. They brought this action against Del Rosario to recover compensation for overtime work rendered beyond eight hours and on Sundays and legal holidays, and one month salary (mesada) provided for in article 302 of the Code of Commerce because the failure of their former employer to give them one month notice. Subsequently, the three mechanics unconditionally withdrew their claims. So only the 49 drivers remained as plaintiffs. The defendant filed a motion for dismissal of the complaint on the ground that it stated no cause of action and the trial court for the time being denied the motion saying that it will be considered when the case was heard on the merits. After trial the complaint was dismissed. Plaintiffs appealed from the order of dismissal to the Court of Appeals which Tribunal after finding only questions of law are involved, certified the case to us. The parties are agreed that the plaintiffs as chauffeurs received no fixed compensation based on the hours or the period of time that they worked. Rather, they were paid on the commission basis, that is to say, each driver received 20 per cent of the gross returns or earnings from the operation of his taxi cab. Plaintiffs claim that as a rule, each drive operated a taxi 12 hours a day with gross earnings ranging from P20 to P25, receiving therefrom the corresponding 20 per cent share ranging from P4 to P5, and that in some cases, especially during Saturdays, Sundays, and holidays when a driver worked 24 hours a day he grossed from P40 to P50, thereby receiving a share of from P8 to P10 for the period of twenty-four hours. The reason given by the trial court in dismissing the complaint is that the defendant being engaged in the taxi or transportation business which is a public utility, came under the exception provided by the Eight-Hour Labor Law (Commonwealth Act No. 444); and because plaintiffs did not work on a salary basis, that is to say, they had no fixed or regular salary or remuneration other than the 20 per cent of their gross earnings "their situation was therefore practically similar to piece workers and hence, outside the ambit of article 302 of the Code of Commerce." For purposes of reference we are reproducing the pertinent provisions of the Eight-Hour Labor Law, namely, sections 1 to 4.

SECTION 1. The legal working day for any person employed by another shall not be more than eight hours daily. When the work is not continuous, the time during which the laborer is not working and can leave his working place and can rest completely shall not be counted. SEC. 2. This Act shall apply to all persons employed in any industry or occupation, whether public or private, with the exception of farm laborers, laborers who prefer to be paid on piece work basis, domestic servants and persons in the personal service of another and members of the family of the employer working for him. SEC. 3. Work may be performed beyond eight hours a day in case of actual or impending emergencies, caused by serious accidents, fire flood, typhoon, earthquakes, epidemic, or other disaster or calamity in order to prevent loss of life and property or imminent danger to public safety; or in case of urgent work to be performed on the machines, equipment, or installations in order to avoid a serious loss which the employer would otherwise suffer, or some other just cause of a similar nature; but in all cases the laborers and the employees shall be entitled to receive compensation for the overtime work performed at the same rate as their regular wages or salary, plus at least twenty-five per centum additional. In case of national emergency the Government is empowered to establish rules and regulations for the operation of the plants and factories and to determine the wages to be paid the laborers. SEC. 4. No person, firm, or corporation, business establishment or place or center of work shall compel an employee or laborer to work during Sundays and legal holidays, unless he is paid an additional sum of at least twenty-five per centum of his regular remuneration: Provided however, That this prohibition shall not apply to public utilities performing some public service such as supplying gas, electricity, power, water, or providing means of transportation or communication. Under section 4, as a public utility, the defendant could have his chauffeurs work on Sundays and legal holidays without paying them an additional sum of at least 25 per cent of their regular remuneration: but that with reference only to work performed on Sundays and holidays. If the work done on such days exceeds 8 hours a day, then the Eight-Hour Labor Law would operate, provided of course that plaintiffs came under section 2 of the said law. So that the question to be decided here is whether or not plaintiffs are entitled to extra compensation for work performed in excess of 8 hours a day, Sundays and holidays included. It will be noticed that the last part of section 3 of Commonwealth Act 444 provides for extra compensation for over-time work "at the same rate as their regular wages or salary, plus at least twenty-five per centum additional'" and that section 2 of the same act excludes application thereof laborers who preferred to be on piece work basis. This connotes that a laborer or employee with no fixed salary, wages or remuneration but receiving as compensation from his employer uncertain and variable amount depending upon the work done or the result of said work (piece work) irrespective of the amount of time employed, is not covered by the Eight-Hour Labor Law and is not entitled to extra compensation should he work in excess of 8 hours a day. And this seems to be the condition of employment of the plaintiffs. A driver in the taxi business of the defendant, like the plaintiffs, in one day could operate his taxi cab eight hours, or less than eight hours or in excess of 8 hours, or even 24 hours on Saturdays, Sundays, and holidays, with no limit or restriction other than his desire, inclination and state of health and physical endurance. He could drive continuously or intermittently, systematically or haphazardly, fast or slow, etc. depending upon his exclusive wish or inclination. One day when he feels strong, active and enthusiastic he works long, continuously, with diligence and industry and makes considerable gross returns and receives as much as his 20 per cent

commission. Another day when he feels despondent, run down, weak or lazy and wants to rest between trips and works for less number of hours, his gross returns are less and so is his commission. In other words, his compensation for the day depends upon the result of his work, which in turn depends on the amount of industry, intelligence and experience applied to it, rather than the period of time employed. In short, he has no fixed salary or wages. In this we agree with the learned trial court presided by Judge Felicisimo Ocampo which makes the following findings and observations of this point. . . . As already stated, their earnings were in the form of commission based on the gross receipts of the day. Their participation in most cases depended upon their own industry. So much so that the more hours they stayed on the road, the greater the gross returns and the higher their commissions. They have no fixed hours of labor. They can retire at pleasure, they not being paid a fixed salary on the hourly, daily, weekly or monthly basis. It results that the working hours of the plaintiffs as taxi drivers were entirely characterized by its irregularity, as distinguished from the specific regular remuneration predicated on specific and regular hours of work of factories and commercial employees. In the case of the plaintiffs, it is the result of their labor, not the labor itself, which determines their commissions. They worked under no compulsion of turning a fixed income for each given day. . . .. In an opinion dated June 1, 1939 (Opinion No. 115) modified by Opinion No. 22, series 1940, dated June 11, 1940, the Secretary of Justice held that chauffeurs of the Manila Yellow Taxicab Co. who "observed in a loose way certain working hours daily," and "the time they report for work as well as the time they leave work was left to their discretion.," receiving no fixed salary but only 20 per cent of their gross earnings, may be considered as piece workers and therefore not covered by the provisions of the Eight-Hour Labor Law. The Wage Administration Service of the Department of Labor in its Interpretative Bulletin No. 2 dated May 28, 1953, under "Overtime Compensation," in section 3 thereof entitled Coverage, says: The provisions of this bulletin on overtime compensation shall apply to all persons employed in any industry or occupation, whether public or private, with the exception of farm laborers, non-agricultural laborers or employees who are paid on piece work, contract, pakiao, task or commission basis, domestic servants and persons in the personal service of another and members of the family of the employer working for him. From all this, to us it is clear that the claim of the plaintiffs-appellants for overtime compensation under the Eight-Hour Labor Law has no valid support. As to the month pay (mesada) under article 302 of the Code of Commerce, article 2270 of the new Civil Code (Republic Act 386) appears to have repealed said Article 302 when it repealed the provisions of the Code of Commerce governing Agency. This repeal took place on August 30, 1950, when the new Civil Code went into effect, that is, one year after its publication in the Official Gazette. The alleged termination of services of the plaintiffs by the defendant took place according to the complaint on September 4, 1950, that is to say, after the repeal of Article 302 which they invoke. Moreover, said Article 302 of the Code of Commerce, assuming that it were still in force speaks of "salary corresponding to said month." commonly known as "mesada." If the plaintiffs herein had no fixed salary either by the day, week or month, then computation of the month's salary payable would be impossible. Article 302 refers to employees receiving a fixed salary. Dr. Arturo M. Tolentino in his book entitled "Commentaries and Jurisprudence on the Commercial Laws of the Philippines," Vol. 1,

4th edition, p. 160, says that article 302 is not applicable to employees without fixed salary. We quote Employees not entitled to indemnity. This article refers only to those who are engaged under salary basis, and not to those who only receive compensation equivalent to whatever service they may render. (1 Malagarriga 314, citing decision of Argentina Court of Appeals on Commercial Matters.) In view of the foregoing, the order appealed from is hereby affirmed, with costs against appellants. Pablo, Bengzon, Padilla, Reyes, Jugo, Bautista Angelo, Labrador, Concepcion, and Diokno, JJ., concur. Paras, C.J., concurs in the result

PHILIPPINE COMMERCIAL AND INDUSTRIAL BANK (PCIB) V. ESCOLIN *this is a case discussed in Succession under Fideicommisary Substitution (which Sir Danicon said to have been ruled correctly, i.e. no fideicommisary substitution) Facts: -Charles and Linnie Jane Hodges (husband and wife) provided mutually in their respective will a provision wherein they would give all their estate to the surviving spouse, and upon the death of the surviving spouse, the remainder of what has been inherited by the surviving spouse from the earlier deceased spouse would be bequeathed to the brothers and sisters of the later deceased. -Mrs. Hodges died first. Mr. Hodges was appointed special administrator and later executor of the will. No liquidation was made. -Upon death of Mr. Hodges, Magno was appointed Administratix of Mrs. Hodges estate and was initially also Mr. Hodges' estate but PCIB took over. Probate proceedings for both estate initiated, the two administrators (PCIB and Magno) differed in the alleged share of Mrs. Hodges in their conjugal partnership property that she could have bequeathed to her heirs. PCIB The estate left by Mrs. Hodges < 1/2 of her share in the conjugal estate (Apply Philippine law), notwithstanding Art16 of our Civil code which mandates the application of Texas law, Mr.Hodges being a citizen of Texas Magno Texas law applicable, wherein no system of legitime provided so estate of Mrs. Hodges could not be less than her share or (?) >1/2

-there was also an allegation on the part of Magno (for the brothers and sisters of Mrs. Hodges) that Mr. Hodges made a renunciation of the inheritance in a manifestation to the US inheritance tax authorities (probably to escape inheritance tax liabilities), which was allegedly ratified by the heirs in the Philippines. (court, though, did not rule on alleged renunciation. For purposes of the discussion, Court assumed that renunciation was not upheld) WON Philippine Law, as alleged by PCIB, should be applied and not Texas law? Texas law applies, but because of estoppel (?) and it is yet to be proven *note: in Succession, it was held in this case that there was no fideicommissary substitution so the 1st heir instituted (Mr. Magno) had no obligation to preserve the properties inherited from his wife for the benefit of the latter's other heirs (the siblings) *no proof yet of what Texas law is, but PCIB allegedly averred that under the laws of Texas (although it was arguing that RP laws apply), there is such legitime of 1/4 of the said conjgal estate >>>so PCIB would be estopped to claim that the estate of Mrs. Hodges should be less than as contended by it (which is initially at least 1/2 of the estate), for admissions by a party related to the effects of foreign laws, which have to be proven in our courts like any other controverted fact, create estoppel. ISSUES THAT CAN BE DECIDED BY THE COURT: Regardless what law is applicable and WON Mr. Hodges did renounce his 1. share, it is clear from the inventory submitted by Mr. Hodges himself as

executor of his wife's estate that there are properties which constitute the estate of Mrs. Hodges which should be distributed among her heirs pursuant to her will It is now beyond controversy that whatever be the provisions of Texas 2. Law applicable, the estate of Mrs. Hodges is AT LEAST 1/4 OF THE CONJUGAL ESTATE OF THE SPOUSES -Existence and effects of foreign laws being questions of fact, and it being the position now of PCIB that the estate of Mrs. Hodges, pursuant to the law of Texas, should only be 1/3 of the conjugal estate, such contention constitutes and admission of fact, and consequently, it would be in estoppel in any further proceedings in these cases to claim that said estate could be less, irrespective of what might be proven later to be the actual provisions of Texas law... Special Proceeding for the settlement of testate estate of Mrs. Hodges 3. cannot be closed, should proceed, there having no proper and legal adjudication or distribution yet of the estate Magno remains to be the Administratrix of Mrs. Hodges's estate 4. WHAT CANNOT BE DECIDED: WON Mr. Hodges renounced his share 1. WON estate of Mrs. Hodges is more than 1/4 of the conjugal property 2. >>>case is remanded to trial court to allow the parties to present evidence in relation to these issues RULING THAT MRS. HODGES'S ESTATE CANNOT BE LESS THAN 1/4 OF THE CPP VS. FINDING THAT NO EVIDENCE YET OF TEXAS LAWS? Court said that evidence should still be presented re: what Texas law contains but PCIB now cannot allege that the estate is less than 1/4 *Elementary is the rule that foreign laws may not be taken judicial notice of and have to be proven like any other fact in dispute between the parties in any proceeding, with the rare exceptional n instances when the said laws are already within the actual knowledge of the court, such as when they are well and generally known, or they have been actually ruled upon in other cases before it and none of the parties concerned claim otherwise.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION

G.R. No. L-22374 December 18, 1974 REPUBLIC OF THE PHILIPPINES, plaintiff-appellant, vs. EMILIO G. GUANZON, defendant-appellee. Office of the Solicitor General Arturo A. Alafriz Solicitor Camilo D. Quiason and Special Attorney Maria C. Paraiso for plaintiff-appellant. Romeo C. Gonzaga for defendant-appellee.

FERNANDO, J.:p A lower court decision, which on its face ignores the controlling statute as well as the applicable doctrines of this Court, is appealed by the Republic of the Philippines. It filed an action for the foreclosure of certain real estate and chattel mortgages executed by defendant Emilio G. Guanzon, now appellee, in favor of the former Bank of Taiwan, Ltd., as security for the payment of the loans obtained by him from said bank. The amount involved is P3,722.13, representing the principal and interest as of September 30, 1961, with an additional sum equivalent to ten percent of the total indebtedness as attorney's fees. The loan transaction took place in 1943 during the period of Japanese occupation. Upon the liberation of the Philippines in 1945, the United States, through its Alien Property Custodian, acquired such credit. Thereafter, by virtue of the Philippine Property Act of 1946, it was transferred to our government. With the statute and the controlling judicial decisions, 1 clearly pointing to one direction, the lower court, in a hasty and improvident exercise of judicial power, apparently oblivious of the law, took the other way. It held that the Republic of the Philippines lacked legal interest over such mortgage loan and dismissed the case. We have no choice but to reverse. The facts are undisputed. As set forth in the brief for appellant Republic of the Philippines: "On May and June, 1943, the defendant obtained two (2) loans from the former Bank of Taiwan, Ltd., at its offices in Bacolod City, in the total sum of P1,600.00, with interest at the rate of six per centum (6%) per annum, compounded quarterly, evidenced by two (2) promissory notes ... executed, signed and delivered by him to said bank. To secure prompt and full payment of the loans, the defendant executed a real estate mortgage ... on the two parcels of land covered by Transfer Certificate of Title Nos. 1848 and 1855 of the Register of Deeds of Negros Occidental and a Chattel Mortgage on standing crops ... growing on the same properties ... . By virtue of Vesting Order No. P-4, dated January 21, 1946, and under the authority of the Trading with the Enemy Act, as amended, the United States of America vested in the Government of the United States the assets in the Philippines of the Bank of Taiwan, Ltd. Pursuant to the Philippine Property Act of 1946, these assets were subsequently transferred to the Republic of the Philippines by the Attorney General of the United States under Transfer Agreements dated July 20, 1954 and June 15, 1957, and are now administered by the Board of Liquidators, a government agency created under Executive Order No.

372, dated November 24, 1950, and in accordance with Republic Acts Nos. 477 and 8, and other pertinent laws." 2 According to the brief for appellee Guanzon: "The statement of facts stated in appellant's brief is substantially correct so that this representation finds no necessity in offering counter-statement of facts." 3 It is not easy to explain, and certainly there is no justification, in the light of the above facts and considering the state of the law, why the lower court, in its decision, dismissed the case on the ground that the Republic of the Philippines lacks legal interest. As noted, we have to reverse. 1. In the very able brief for appellant Republic of the Philippines, prepared by the then Solicitor General Arturo A. Alafriz and the former Solicitor, later Assistant Solicitor General Camilo D. Quiason, it was made clear that while the Bank of Taiwan, Ltd. was the original creditor of the loans thus secured, with defendant, now appellee, executing the mortages in question, the United States, pursuant to the Trading with the Enemy Act 4 acquired such account, being among the assets of a bank which was a declared national of an enemy country. This it did through a vesting order, 5 the legal effect of which was to effectuate immediately the transfer of title by operation of law without any necessity for any court action. Thus, title over such credit passed to the United States "as completely as if by conveyance, transfer, or assignment, ... . " 6 The brief for the Republic continues: "In accordance with the Philippine Property Act of 1946, the United States Government transferred, conveyed and assigned to the Government of the Republic of the Philippines under Transfer Agreements, dated July 20, 1954 and June 15, 1957, all its rights, title and interest to the loans in question. As such transferee, the Republic of the Philippines acquired the title and interest thereto ... . It follows, therefore, that plaintiff has a legal interest in the promissory notes and in the real and chattel mortgages and has a cause of action against the debtor-mortgagor, the defendant herein." 7 All that was set forth in the three-page brief of counsel for appellee Guanzon reads as follows: "There is no showing as to how plaintiff-appellant was able to acquire the Real and Chattel Mortgage executed by the defendant-appellee in favor of the Bank of Taiwan Ltd. a private bank of Japan, and therefore has no legal interest in the subject matter. The transfer of obligation in question cannot be taken Judicial Notice by our courts because the vesting order P-4 of the Government of the United States, pursuant to the Trading with the Enemy Act, as amended, of any and all property of any nature whatsoever subject to the Jurisdiction of the United States affecting alien property in the Philippines cannot be taken Judicial Notice in the light of Sec. 1 of Rule 129 of the New Rules of Court, inasmuch as the Trading with the Enemy Act is a foreign law enacted by the U.S. Government which is not enumerated in the aforecited new Rules of Court. Consequently, proof should have been introduced to show how the United States Government was able to acquire the subject matter in litigation which was later transferred to the plaintiff-appellant." 8 It thus appears obvious that counsel for appellee lacks awareness of the controlling doctrine announced in the leading case of Brownell, Jr. v. Sun Life Assurance Company, 9 where Justice Labrador explicitly set forth: "This purpose of conveying enemy properties to the Philippines after all claims against them shall have been settled is expressly embodied in the Philippine Property Act of 1946," 10 A brief history of the Philippine Property Act of 1946 is likewise found in his opinion: "On July 3, 1946, the Congress of the United States passed Public Law 485-79th Congress, known as the Philippine Property Act of 1946. Section 3 thereof provides that "The Trading with the Enemy Act of October 6, 1917 (40 Stat. 411), as amended, shall continue in force in the Philippines after July 4, 1946, ... ." To implement the provisions of the act, the President of the United States on July 3, 1946, promulgated Executive Order No. 9747, "continuing the functions of the Alien Property Custodian and the Department of the Treasury in the Philippines." Prior to and preparatory to the approval of said Philippine Property Act of 1946, and agreement was entered into between President Manuel Roxas of the Commonwealth and U.S. Commissioner Paul V. McNutt whereby title to enemy agricultural lands and other properties was to be conveyed by the United States to the Philippines in

order to help the rehabilitation of the latter, but that in order to avoid complex legal problems in relation to said enemy properties, the Alien Property Custodian of the United States was to continue operations in the Philippines even after the latter's independence, that he may settle all claims that may exist or arise against the above-mentioned enemy properties, in accordance with the Trading with the Enemy Act of the United States."11 Nothing can be clearer, therefore, than that the lower court grievously erred in failing to perceive that precisely the Republic of the Philippines, contrary to its holding, possesses a legal interest over the subject matter of this controversy. 2. Apparently, the lower court, perhaps taken in by the contention of appellee, could not see its way clear to applying the Philippine Property Act of 1946 enacted by the United States Congress as it was a foreign statute not susceptible to judicial notice. Again, if it were cognizant of the leaning of the above Brownell decision, it would have realized how erroneous such a view is. For, as was made clear in the above decision, there was "conformity to the enactment of the Philippine Property Act of 1946 of the United States [as] announced by President Manuel Roxas in a joint statement signed by him and by Commissioner McNutt Ambassador Romulo also formally expressed the conformity of the Philippine Government to the approval of said act to the American Senate prior to its approval."12 It was further stressed by Justice Labrador that after the grant of independence, the Congress of the Philippines approved Republic Act No. 8, which authorized the President of the Philippines to enter into such contract or undertakings as may be necessary to effectuate the transfer to the Republic of the Philippines under the Philippine Property Act of 1946 of any property or property rights or the proceeds thereof authorized to be transferred thereunder. Then his opinion continues: "The Congress of the Philippines also approved Republic Act No. 7, which established a Foreign Funds Control Office. After the approval of the Philippine Property Act of 1946 of the United States, the Philippine Government also formally expressed, through the Secretary of Foreign Affairs conformity thereto. ... The Congress of the Philippines has also approved Republic Act No. 477, which provides for the administration and disposition of properties which have been or may hereafter be transferred to the Republic of the Philippines in accordance with the Philippine Property Act of 1946 of the United States." 13 From which, the above conclusion follows: "It is evident, therefore, that the consent of the Philippine Government to the application of the Philippine Property Act of 1946 to the Philippines after independence was given, not only by the Executive Department of the Philippine Government, but also by the Congress, which enacted the laws that would implement or carry out the benefits accruing from the operation of the United States law." 14 Under the circumstances, there is no question, as was pointed out by the same jurist, "that a foreign law may have extraterritorial effect in a country other than the country of origin, provided the latter, in which it is sought to be made operative, gives its consent thereto." 15 That is a sound legal proposition. It is a juridical norm that has found acceptance in the Philippines at the close of the nineteenth century after its acquisition by the United States. Its origins in American law can be traced back to Chief Justice Marshall's opinion in The Schooner Exchange v. M'Faddon, 16 an 1812 decision. It was cited with approval in the recent case of Reagan v. Commissioner of Internal Revenue. 17 The doctrine is not unknown to European law. So it was noted in Reagan, with a citation from Jellinek: "It is to be admitted that any state may, by its consent, express or implied, submit to a restriction of its sovereign rights. There may thus be a curtailment of what otherwise is a power plenary in character. That is the concept of sovereignty as auto-limitation, which, in the succinct language of Jellinek, "is the property of a state-force due to which it has the exclusive capacity of legal self-determination and self-restriction." A state then, if it chooses to, may refrain from the exercise of what otherwise is illimitable competence." 18 It is thus undoubted that the lower court misapplied the rule on judicial notice. 19 The lower court could not simply have closed its eyes to the plain command of the Philippine Property Act of 1946,

which is a part of Philippine law, as was held so categorically by the above Brownell decision. To repeat, there is no justification for the appealed decision. 3. The tone of certitude with which the lower court summarily dismissed the claim of the Republic on the ground of lack of legal interest is thus uncalled for. It could have been avoided by an acquaintance, even of the slightest, with the doctrines enunciated by this Tribunal. An excerpt from Barrera v. Barrera 20 is of some relevance: "The delicate task of ascertaining the significance that attaches to a constitutional or statutory provision, an executive order, a procedural norm or a municipal ordinance is committed to the judiciary. It thus discharges a role no less crucial than that appertaining to the other two departments in the maintenance of the rule of law. To assure stability in legal relations and avoid confusion, it has to speak with one voice. It does so with finality, logically and rightly , through the highest judicial organ, this Court. What it says then should be definitive and authoritative, binding on those occupying the lower ranks in the judicial hierarchy. They have to defer and to submit." 21 WHEREFORE, the decision of August 29, 1963 dismissing the complaint of the Republic of the Philippines is reversed and set aside. Costs against defendant Guanzon. Barredo, Antonio, Fernandez and Aquino, JJ., concur.

A.M. No. MTJ-90-496 August 18, 1992MARCELO B. ASUNCION, LUCITA ASUNCION, JOSEFINA DEL ROSARIO,MIRIAM ASUNCION, and MARILOU ASUNCION, complainants,vs. HON. K. CASIANO P. ANUNCIANCION, JR., Presiding Judge,Metropolitan Trial Court, Branch XI, Manila, respondent. Issue: Whether or not the respondent, Judge K. Casiano P. Anunciancion, displayed and isguilty of serious misconduct, oppression and ignorance of the law, which furtherresulted to a violation of the complainants human rights. Facts: Respondent Metropolitan Trial Court Judge K. Casiano P. Anunciacion, Jr. of Manila wasbeing charged with 1) ignorance of the law and judicial incompetence, 2) oppressionand arbitrary exercise of power, and 3) violation of human rights in line with his exerciseof judicial decision-making in a previous ejectment case which involved thecomplainants (as respondents) and a Herminio Samson (who filed the ejectment caseand stood as the complainant).During the said ejectment case hearing, the said respondent judge allegedly hastilyadjourned the proceedings after the complainant Marcelo Asuncion gave his statement,which the respondent judge saw as an admission of the contempt being chargedagainst the respondents of the said ejectment case, and issued an Order.Furthermore, during the said ejectment case, Asuncion requested a postponementbecause his lawyer was not available at that time. However, it was denied by therespondent judge and, in a loud voice, declared that he would put Asuncion's wife anddaughters in jail, where he indeed called a branch sheriff to enforce his order to putAsuncion's wife and daughters in jail. Held: The case was raffled to the Regional Trial Court of Manila, Branch 27, for investigation,report and recommendation. On June 8, 1992, Judge Edgardo P. Cruz submitted anInvestigation Report recommending that respondent Judge be fined and given anappropriate warning.After reviewing the records of the proceedings before respondent Judge, the Courtagrees with the investigating Judge that respondent Judge Anunciacion acted arbitrarily,despotically and with complete disregard for the complainants' rights, when he orderedthem to be jailed without even informing them of the charge against them, either byfurnishing them with a copy of the contempt motion or reading it to them. Respondent Judge did not inform the complainants of the nature and cause of the accusation againstthem contrary to the directive in Sec. 3, Rule 71 of the Rules of Court. Neither did hegive the complainants a chance to explain their side.Moreover, respondent Judge denied them the right to be assisted by counsel and theright to defend themselves, even as their father, Marcelo Asuncion, pleaded forpostponement of the proceedings because his lawyer was not available at the time. Byhis oppressive and precipitate action, respondent Judge displayed arrogance and grossignorance of the law and violated the complainants' human rights.

WHEREFORE, the Court finds respondent Judge K. Casiano P. Anunciacion, Jr. guilty of serious misconduct, oppression and ignorance of the law and sentences him to pay afine of P10,000 to the cashier of the Supreme Court. He is warned that a repetition of the offense in the future will be dealt with more severely.

Republic of the Philippines SUPREME COURT Manila EN BANC

A.M. No. MTJ-91-619 January 29, 1993 ATTY. HUGOLINO V. BALAYON, JR., petitioner, vs. JUDGE GAYDIFREDO O. OCAMPO, respondent.

CAMPOS, JR., J.: For our consideration is a letter-complaint of Atty. Hugolino V. Balayon, Jr., dated October 9, 1991, charging Judge Gaydifredo O. Ocampo of the Metropolitan, Trial Court, Tupi, South Cotabato with gross ignorance of the law and grave misconduct. The charge is grounded on eight complaints, separately discussed as follows: FIRST COMPLAINT: The first complaint charges respondent Judge with gross ignorance of the law and grave misconduct. The charge arose when one Ronilo Hijastro complained to respondent Judge about a certain Romeo Panes (complainant's client) who allegedly was withholding possession of some sacks of copra from Ronilo Hijastro. Hijastro sought the help of respondent Judge for protection while his dispute with Romeo Panes was ongoing. Ronilo Hijastro was not interested in the services of a lawyer. What respondent Judge did was to write one Lt. Sulam, the Police Station Commander of Tupi, South Cotabato, to wit:

Dear Lt. Sulam,

Bearer went to me for legal advice affecting the sacks of copras and other produce of the land in possession by Mr. Ronilo Hijastro but who appears to be an illegitimate son of the late Mr. Juan Panes. Mr. Romeo Panes is allegedly claiming the land and its produce as brother of Mr. Juan Panes. Romeo has no right on it as he has no papers on the land notwithstanding being a brother of Juan Panes. So, if Romeo shall force Ronilo or his tenant on the land to give the produce and possession of the land, your Office can lend assistance to Mr. Ronilo Hijastro. Thanks. (SGD.) JUDGE GAYDIFREDO OCAMPO 1 Complainant contends that what respondent Judge did amounts to private practice which is in conflict with his position of being a municipal judge. Complainant further accuses respondent Judge of using his influence as incumbent Judge to pressure the Police Station Commander as a result of which the sacks of copra were sold with respondent Judge reportedly having been given a share in the proceeds. In his Comment, respondent Judge admits having written the aforequoted letter, but vehemently denies the express insinuations by complainant of any ulterior motive on his part. He does not personally know said Ronilo Hijastro as that was the first time respondent Judge met him in his sala. He advised him to see a counsel who could lend him legal assistance on any proper case that may be filed, if he so desired, but Hijastro, according to him, just wanted police assistance. While he might have fallen short of using his discretion in writing the letter, he contends that he did the same in full and absolute good faith. He denies having gotten a share of the sale of the sacks of copra. We do not find respondent Judge guilty of grave misconduct: In the case of Babatio vs. Tan, 2 this Court ruled that "(f)or serious misconduct to exist, there must be reliable evidence showing that the judicial acts complained of were corrupt or inspired by an intention to violate the law, or were in persistent disregard of all well-known legal rules". In the case at bar, although respondent Judge admitted having written the letter dated December 7, 1989, there is no showing that he did so with the intention to violate the law. Neither is the charge that he was reportedly given a share of the sale substantiated. Mere suspicion without proof cannot be a basis for conviction. It should be pointed out, however, that under Cannon 2 of the Code of Judicial Conduct, a judge should avoid impropriety and the appearance of impropriety in all activities. Hence, respondent Judge is advised to conduct himself accordingly. SECOND COMPLAINT: On January 4, 1990, a Criminal Complaint for Qualified Theft as Principals and Accessories Afterthe-Fact, docketed as Criminal Case No. 5016 entitled, "People vs. Mario Sanso, Fernando Manggubat and Tony Joven", was filed by Lt. Sulam before respondent Judge's sala. Tony Joven was charged as an accessory after-the-fact for allegedly having bought two (2) piglets which were the proceeds of the crime.

On the same date, Lt. Sulam filed an application for search warrant attaching thereto the affidavit of one Mario Lim as witness. Respondent Judge took the sworn statements of Lt. Sulam and Mario Lim and on the basis thereof issued the search warrant. The implementation of the search warrant resulted in the seizure of two piglets found at Tony Joven's backyard. Thereafter, respondent Judge issued a warrant of arrest against Tony Joven who was later arrested and imprisoned but was released after posting the necessary bail. It was only after his release that Tony Joven engaged the legal services of complainant. On January 29, 1990, complainant filed an Urgent Motion to Quash Search Warrant and Warrant of Arrest alleging that the same were illegally issued on the ground that the applicant and his witness have no personal knowledge of the facts and circumstances which formed the basis for the issuance of said warrants. Hence, in violation of his client's constitutional rights. On February 16, 1990, respondent Judge issued a resolution annulling the subject search warrant and the proceedings held thereon after finding that the applicant and his witness did not have the personal knowledge as required by law. With respect to the warrant of arrest, the same stood. Respondent Judge scheduled the arraignment and trial of complainant's client. Complainant charges respondent Judge for alleged illegal issuance of a search warrant and warrant of arrest. In his Comment, respondent Judge contends that: "Notwithstanding the fact that the respondent in the resolution . . . quashed the said search warrant, it does not mean that the (same was) at the outset illegally and improvidently issued as it found a basis for its issuance as aforestated. The said resolution was accomplished not solely on the basis of the said motion of complainant . . . but on the inherent power of the Court to amend its orders and processes to conform to law and justice. Besides, the resolution of respondent speaks for itself. Affecting the warrant of arrest which the complainant argued should have been cancelled also together with the search warrant, respondent does not find basis in his judicial discretion to do so. Complainant's allegation of gross ignorance of law on the part of respondent is therefore only his self-serving assertions of his personal view". 3 Respondent Judge further states that after complainant filed his said Urgent Motion, he inhibited himself from continuing with the further proceedings of this case in the exercise of his sound discretion. He added that the subject case had long been terminated by the Judge designated by Executive Judge Rodolfo Soledad, RTC, Marbel, South Cotabato. Complainant failed to show that there was malice or bad faith on the part of respondent Judge in issuing the subject warrants. Every court has the power and indeed the duty to review and amend or reverse its findings and conclusions when its attention is timely called to any error or defect therein. 4 In the case at bar, the motion to quash the search warrant and warrant of arrest filed by complainant was favorably considered by respondent Judge which resulted in the quashal of the search warrant. The non-quashal of the warrant of arrest was due to the fact that complainant's client has already posted bail. Absent any showing that respondent judge acted with malice or bad faith in the issuance of the subject warrants, the presumption is that official duty has been regularly performed by him. THIRD COMPLAINT:

On December 4, 1990, a Criminal Complaint for Theft, docketed as Criminal Case No. 5123, entitled, "People vs. Norberto Solis and Jose Catapang", was filed by Lt. Sulam on the basis of the sworn statements of two prosecution witnesses, namely, Antonio Dacayo and Buenaventura Condova, against Jose Catapang and Norberto Solis accusing them of stealing pineapples belonging to DOLEFIL plantation before the respondent Judge's court. Although respondent Judge was satisfied that there existed probable cause based on the sworn statements of the prosecution witnesses, on December 20, 1990, respondent Judge conducted a summary clarificatory examination of Romulo Severino, a jeepney driver, and one of the accused, Jose Catapang. Thereafter, respondent Judge issued a warrant of arrest against Jose Catapang and Norberto Solis. On January 15, 1991, as shown in the return of the warrant of arrest, Jose Catapang was arrested and detained at the municipal jail of Tupi. Norberto Solis was at large. On January 23, 1991, the case was called for arraignment but was postponed since the accused had no counsel. Complainant was appointed as his counsel-de-oficio. On February 11, 1991, complainant filed an Urgent Motion for Postponement of the arraignment. On February 12, 1991, accused posted bail and was released. On February 21, 1991, Jose Catapang, with the assistance of complainant, was arraigned and pleaded not guilty. After the arraignment, complainant manifested that he was filing a Motion to Dismiss. On March 5, 1991, complainant filed an Urgent Motion to Dismiss on the ground that the arrest of complainant's client was unlawful. On March 6, 1991, respondent Judge issued an Order dismissing the case. On March 19, 1991, private prosecutor filed a Motion for Reconsideration of the Order of Dismissal. Per Order of the same date, respondent Judge reconsidered his Order of dismissal. On April 2, 1991, respondent Judge reiterated his previous Order of dismissal. Private prosecutor filed with the RTC a petition for certiorari which was pending resolution at the time this complaint was filed. Complainant comes to this Court charging respondent Judge with gross ignorance of the law in ordering the arrest of accused Jose Catapang on mere suspicion, hence, resulting in the illegal arrest and arbitrary detention of the accused because the sworn statements of the two prosecution witnesses were not based on their personal knowledge of facts and circumstances. Neither did the clarificatory examinations conducted by respondent Judge on Romulo Severino and Jose Catapang point to the accused as the persons who stole the pineapples. Again, there is no showing that malice or bad faith attended the issuance of the warrant of arrest by the respondent Judge.

As earlier mentioned, every court has the power and indeed the duty to amend or reverse its findings and conclusions when its attention is timely called to any error or defect therein. 5 Let it be noted, though, that this is the second complaint charging respondent Judge of issuing a search warrant and/or warrant of arrest in violation of the requirement of personal knowledge of the facts and circumstances by the applicant and his witnesses. This does not speak well of respondent Judge's appreciation and application of the law. It would be beneficial for both respondent Judge and those whose cases would fall within his jurisdiction, if respondent updated himself with the law and latest jurisprudence. Respondent Judge is admonished to exercise more prudence and circumspection in the issuance of the aforementioned warrants so as not to trample on the rights as guaranteed by the Constitution. FOURTH COMPLAINT: The complaint states that respondent Judge, with gross ignorance of the law, allowed a witness to testify during the trial without previously submitting his affidavit as required under Section 14 of the Rules on Summary Procedure. 6 In People vs. Esther Ante, Criminal Case No. 5226 for Slight Physical Injuries, a prosecution witness who had not previously submitted his affidavit was allowed by respondent Judge to testify during the trial, over and above the objection of complainant. Complainant alleged that Section 14 of the Rules on Summary Procedure expressly prohibits any witness, without exception, from testifying during the trial without previously submitting his affidavit, citing the case of Gonzales v. Presiding Judge of Branch 1, RTC of Bohol. 7 In Orino vs. Judge Gervasio, 8 the Supreme Court ruled in a Minute Resolution that even if a witness has not properly submitted his/her affidavit, he may be called to testify in connection with a specific factual matter relevant to the issue. Thus, a medical doctor whose medical certificate is among the evidence on record may be called to testify. This also applies to a Register of Deeds or Provincial Assessor in connection with official documents issued by his office. Respondent Judge may not therefore be held guilty of ignorance of the law. FIFTH COMPLAINT: The complaint alleges that respondent Judge continuously notarized documents not connected with the exercise of his official functions and thus earning extra money out of the same, even if there were two duly commissioned notaries public in the municipality, contrary to the Resolution of the Court En Banc dated December 19, 1989. In his Comment, respondent Judge contends that the power of the MTC and MCTC judges to act as notaries public ex-officio, contained in Circular No. 1-90 dated February 26, 1990, was received by him on March 30, 1990. Respondent Judge vehemently denies the alleged continuous notarization. He admits that he had notarized six documents in 1990 and three documents in 1991. The aforesaid documents were notarized by respondent Judge by reason of the unavailability of notaries public and the urgent need by the parties therein. The fees thereon were paid to the Government as certified to by the Clerk of Court. 9 Respondent Judge admits that there are two lawyers and notaries public in his station at Tupi. They are Atty. Neptali Solilapsi and the herein complainant. Although Atty. Solilapsi is a resident of Tupi and with a law office thereat, he is rarely present by reason of almost daily appearances in the

courts of the province of South Cotabato and General Santos City, not to mention his occasional trips to Manila. On the other hand, herein complainant, although residing in Tupi holds a law office at Marbel, South Cotabato and goes home late in the afternoon or evening. They are therefore not in a position to render regular legal services that may be asked of them in Tupi. The 1989 Code of Judicial Conduct not only enjoins judges to regulate their extra-judicial activities in order to minimize the risk of conflict with their judicial duties, but also prohibits them from engaging in the private practice of law. 10 It is well settled that municipal judges may not engage in notarial work except as notaries public exofficio. As notaries public ex-officio, they may engage only in the notarization of documents connected with the exercise of their official functions. They may not, as such notaries public exofficio, undertake the preparation and acknowledgment of private documents, contracts and other acts of conveyance, which bear no relation to the performance of their functions as judges. However, taking judicial notice of the fact that there are still municipalities which have neither lawyers nor notaries public, the Supreme Court ruled that MTC and MCTC judges assigned to municipalities or circuits with no lawyers or notaries public may, in their capacity as notaries public ex-officio, perform any act within the competency of a regular notary public, provided that: (1) all notarial fees charged be for the account of the Government and turned-over to the municipal treasurer and (2) certification be made in the notarized documents attesting to the lack of any lawyer or notary public in such municipality or circuit. 11 In the case at bar, there are two notaries public in respondent's station at Tupi. That these two notaries public do not appear to be stationed regularly at Tupi, as respondent Judge claims, does not suffice to qualify under the exception. It is only when there are no lawyers or notaries public that the exception applies. For the unauthorized notarization of nine private documents, respondent Judge is hereby ordered to pay the fine of TEN THOUSAND PESOS (P10,000.00) with a warning that the commission of similar acts in the future will warrant a more severe sanction. 12 SIXTH COMPLAINT: On May 15, 1989, a Criminal Complaint for grave threats against Joe Maliang was filed with the respondent Judge's sala. After the submission of the affidavits and counter-affidavits, respondent Judge rendered a decision dated October 4, 1989 convicting the accused of light threats as defined and penalized under Article 285, paragraph 2 of the Revised Penal Code. On October 16, 1989, accused appealed to the Regional Trial Court, 11th Judicial Region, Branch 25, Koronadal, South Cotabato. The Regional Trial Court rendered its decision dated July 19, 1990 reversing the respondent Judge and acquitting the accused on reasonable doubt. Complainant now contends that with the acquittal of his client in the grave threats case, respondent Judge had shown his utter lack of correct appreciation of evidence. It is also a manifestation of respondent Judge's habit of deciding cases on his own personal view and not based on the evidence adduced. There is no showing that respondent Judge decided the case in bad faith. It will be noted that complainant's client was acquitted on reasonable doubt. Hence, there was evidence indicating that he committed the crime but that the evidence presented by the prosecution was not enough to convict complainant's client beyond reasonable doubt.

In the case of Vda. de Zabal vs. Pamaran, 13 this Court had the occasion to pronounce that mere errors in the appreciation of evidence, unless so gross and patent as to produce an inference of ignorance or bad faith, or that the judge knowingly rendered an unjust decision are irrelevant and immaterial in an administrative proceeding against him. SEVENTH COMPLAINT: A letter-complaint 14 for theft, dated July 2, 1991, was filed by Rodolfo L. Lizada, in his capacity as Tupi Municipal Agrarian Reform Officer, against Feliciano Angeles, et. al . This was based on the alleged illegal taking by the accused of the galvanized iron roofing sheets of a government warehouse. Attached to the letter-complaint were the affidavits and sworn statements of witnesses. 15 On July 17, 1991, respondent Judge conducted an ocular inspection and found the following: 1. The galvanized iron roofings of the government warehouse were indeed missing. 2. A total of eighty-eight used galvanized iron sheets were found in the premises of accused Feliciano Angeles. He was not around when the inspection team arrived. 3. Feliciano Angeles' wife was present during the inspection. She informed the members of the inspection team that five of the used galvanized iron sheets were used in roofing their house. However, when Feliciano Angeles arrived, he corrected his wife's statement, saying that a total of eight was instead used by them. On August 6, 1991, respondent Judge issued a resolution dismissing the case and remanded the records thereof to the Office of the Provincial Prosecutor at Marbel, South Cotabato. In dismissing the case, the respondent Judge ruled as follows:
For all these acts of the accused, the Court does not find a prima facie case for Theft. The elements of Theft are clear and firm. All must be present. Intent to gain as one of its basic elements was not satisfactorily established as the subject GI sheets were not taken away from the premises but rather found and kept therein by the accused for cogent reason of prevailing thievery (sic) at the place which the prosecution did not dispute. The Court neither finds a case for malicious mischief as assuming a damage was caused by the accused, there is no evidence that he deliberately and maliciously removed the GI sheet roofings of the subject bodega but rather he did it with cogent reason as herein before stated. The liability of the accused, if any, is civil in nature. The private complainant has other provisional remedies to protect its interest. 16

In this seventh complaint, respondent Judge is being charged with gross ignorance of the law and grave abuse of discretion. Complainant alleges that respondent Judge abused his discretion in dismissing the case for theft and had no jurisdiction in ruling that no malicious mischief was committed considering that the case at bar was for theft and that another one for malicious mischief was pending in his sala. Complainant further accuses respondent Judge of having dismissed the case on the ground that one of the accused, Normita Cornejo, is the daughter-in-law of respondent Judge's good friend. A reading of the ocular inspection report shows that all the elements of theft are present in the case. Contrary to respondent Judge's basis for dismissal, the element of intent to gain was present therein. The wife of the accused admitted having used five galvanized iron sheets for their house. This was

reiterated by the accused Feliciano Angeles that not only five, but eight galvanized iron sheets, were appropriated for their house. Hence, the dismissal of the case was not proper. However, complainant still has the remedy of review by the provincial fiscal. Although a judge may not always be subjected to disciplinary action for an error of judgment or lack of awareness of the appropriate legal rules, that does not mean that he should not exercise due care in performing his adjudicatory prerogatives. He should study the principles of law and be diligent in endeavoring to ascertain the facts. 17 Respondent Judge is therefore admonished to exercise more prudence and circumspection in the performance of his duties as municipal judge. EIGHTH COMPLAINT: A Criminal Complaint for Theft docketed, as Criminal Case No. 5180, entitled, "People vs. Julio Relative and Miller Estigoy", was filed before respondent Judge's sala charging accused of stealing coconut trees. After the prosecution had rested its case, complainant, as defense counsel, instead of presenting his evidence, filed a Demurrer to the Evidence on June 4, 1991 alleging that the private complainant in said case had no legal personality to sue because he was no longer the owner of the land where the coconut trees were stolen, having failed to redeem the land from the Development Bank of the Philippines. An Opposition to Demurrer to the Evidence, dated June 4, 1991, was filed by the prosecution. On June 18, 1991, respondent Judge issued an Order denying the said Demurrer to the Evidence. On June 29, 1991, complainant filed an Urgent Motion for Reconsideration. On July 1, 1991, the prosecution was ordered to file its Comment on the Urgent Motion for Reconsideration. On July 11, 1991, the prosecution filed its Comment and Opposition to the Urgent Motion for Reconsideration. On July 17, 1991, the Motion for Reconsideration was denied by respondent Judge. On August 12, 1991, complainant filed a Special Action for Certiorari with the Regional Trial Court contending that respondent Judge committed grave abuse of discretion amounting to lack or excess of jurisdiction in denying complainant's Demurrer to the Evidence. Complainant now charges respondent Judge with gross ignorance of the law and/or grave misconduct in denying his Demurrer to the Evidence. The charge of gross ignorance of the law and/or grave misconduct has no factual basis. Not every error of judgment can be attributable to a judge's ignorance of the law. Until the alleged error shall have been properly raised on appeal and resolved by the proper appellate court, it is generally premature to say that the error was due to the Judge's ignorance of the law. 18

Judicial action on a motion to dismiss or demurrer to the evidence is left to the exercise of sound judicial discretion. Unless there is a grave abuse thereof, amounting to lack of jurisdiction, the trial court's denial of a motion to dismiss may not be disturbed. 19 It will be noted that complainant had already filed a petition for certiorari with the Regional Trial Court. IN SUMMARY, We resolved the eight complaints filed against respondent Judge as follows: FIRST COMPLAINT: Under Cannon 2 of the 1989 Code of Judicial Conduct, respondent Judge should avoid impropriety and the appearance of impropriety in all his activities. While respondent Judge was found to have written the police station Commander of Tupi, South Cotabato, in good faith, he should refrain from engaging in such activity, and other similar ones, so as not to tarnish the integrity and impartiality of the judiciary. SECOND COMPLAINT: There is no basis for the charge against respondent Judge of improperly issuing a search warrant and a warrant of arrest in relation to Criminal Case No. 5016. The issuance was not attended with malice or bad faith. The complaint is therefore hereby dismissed. THIRD COMPLAINT: This being the second complaint against respondent Judge for alleged issuance of a search warrant and/or a warrant of arrest in Criminal Case No. 5123 in violation of the requirement of personal knowledge, respondent Judge is hereby admonished to exercise more circumspection and prudence in the issuance of the said warrants so as not to unwittingly trample on the constitutionally guaranteed rights of the accused. FOURTH COMPLAINT: This complaint is dismissed. We hold respondent Judge not guilty of ignorance of the law when he allowed a witness to testify despite his non-submission of an affidavit. This is well within the Rules on Summary Procedure. FIFTH COMPLAINT: For the unauthorized notarization of nine private documents, respondent Judge is fined TEN THOUSAND PESOS (P10,000.00) with warning that the commission of similar acts in the future will warrant a more severe sanction. SIXTH COMPLAINT: This complaint is dismissed. That respondent Judge's decision of convicting accused in a criminal complaint for light threats was reversed on appeal on reasonable doubt is not an indication of respondent Judge's lack of correct appreciation of facts. A mere error in judgment is immaterial in an administrative complaint against a judge absent any showing of bad faith. SEVENTH COMPLAINT: There is enough evidence to hold respondent Judge remiss in the performance of his duties as municipal judge when he dismissed a criminal case for theft filed with his sala for preliminary investigation despite his own finding that there was intent to gain on the part of the accused when they appropriated the galvanized iron sheets. Thus, respondent Judge is again admonished to exercise more prudence and circumspection in the performance of his duties as municipal judge. EIGHTH COMPLAINT: The denial of a demurrer to the evidence is left to the sound discretion of the Court, rather than an indication of ignorance of the law. It was well within the respondent Judge's discretion, absent any showing of bad faith or excess of jurisdiction, for him to have denied complainant's Demurrer to the Evidence in Criminal Case No. 5180. The complaint is therefore dismissed. SO ORDERED.

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION

A.M. No. P-88-255 March 3, 1992 MANUEL U. DEL ROSIRIO, ESPERANZA DEL ROSARIO NICOLAS KALUBIRAN, ADELAIDA KALUBIRAN,complainants vs. JOSE T. BASCAR, JR., TRIAL COURT IN CITIES (MTCC), CEBU CITY, respondent. Manuel S. Paradela for complainant.

MEDIALDEA, J.: In a verified letter-complaint Manuel U. del Rosario, et al. charged Deputy Sheriff Jose Bascar, Jr. of the Municipal Trial Court in Cities (MTCC), Branch 4. Cebu City for "Gross Ignorance of the Law, Levying Properties Unreasonably and Unnecessarily Levying Properties with Malice and Abuse of Authority and Gross/Wilful Violation of Law." This case originated from a complaint filed with the then Human Settlements Regulatory Commission, Region VII, Cebu City in HSRC Case No. REM-0006-210685, entitled "Angel Veloso, et al. vs. Esperanza del Rosario, et al." for violation of P.D. No. 957, otherwise known as the Subdivision and Condominium Buyer's Protective Decree. A decision was rendered of the Aforesaid case on June 10, 1986. the dispositive portion of which reads: WHEREFORE, in view of the foregoing considerations respondents Esperanza Del Rosario, Manuel del Rosario, Adelaida Kalubiran and Nicolas Kalubiran are hereby ORDERED, jointly and severally 1. to apply for and secure a Certificate of Registration from this Commission within two (2) months from receipt hereof; 2. to accept installment payments from complainants with interest at the legal rate of twelve per cent (12%) per annum and to execute a Deed of Sale over subject lots once full payment of the Unpaid balance of the purchase price is effected; 3. to register the Contract of Sale executed on March 1. 1974 (Annex "A") with the Office of the Register of Deeds of Cebu City within one (1) month from receipt hereof; 4. to pay a fine of P2,000.00 for failure to secure a certificate of registration and a license to sell from this Commission within one (1) month from receipt hereof;

5. to develop the subdivision open space, parks and playgrounds as advertised within six (6) months from receipt hereof; and 6. to complete development of subdivision roads and underground drainage facilities up to lot lines within six (6) months from receipt hereof. (pp. 24-25, Records) Complainants alleged that respondent, Deputy Sheriff is grossly ignorant of the law in implementing the writ of execution of the dispositive portion of the aforecited cost which orders specific performance and hence, is governed by Section 9 of Rule 39 of the Rules of Court. They said that under this Section, no levy of personal or real properties is required but through gross ignorance, respondent executed the writ pursuant to Section 15 of Rule 39 and proceeded to levy on execution three (3) parcels of land having a total market value of P1,236,600.00 of, Miradel Development Corporation wherein Esperanza del Rosario has alleged shares, interests and participation, in order to satisfy the judgment involving specific performance. Complainants alleged further that the levy on execution involved registered lands and hence, must be in accordance with Section 71, R.A. 496 which requires that levy on execution of registered lands must contain a reference to the number of the Certificate of Title of the land to be affected and the volume and page in the registry book where the certificate is registered. It is contended by the complainants that respondent is grossly ignorant of the law considering that the dispositive portion of the decision is for specific performance and the fine of P2,000.00 is not payable to the prevailing parties but to the Commission. Complainants asserted that the levy on the three (3) parcels of land belonging to the Miradel Corporation with a value of more than 1 million pesos is excessive considering that, apparently, the levy is for the payment of the fine of P2,000.00 and the implementation of the writ was tainted with malice and abuse of authority because he could have just levied on the personal properties of the herein complainants which could satisfy the alleged judgment and costs. Pursuant of a Resolution of this Court dated November 23, 1988 respondent filed his comment an the complaint (pp. 31-37, Rollo). Respondent contended that the levy was not made to satisfy the fine of two thousand pesos (P2,000.00) but to protect the rights of the prevailing parties considering that complainants refused to comply with the decretal portion of the decision. He stated that the lots he levied upon which are portions of the lots in controversy covered by TCT Nos. 55606 and 55607 are vacant and there was malice and bad faith in the transfer of the lots in question to Miradel Development Corporation wherein complainant Esperanza del Rosario is the treasurer. In the resolution of this Court dated December 5, 1990, this case was referred to Executive Judge; Regional Trial Court, Cebu City for investigation, report and recommendation. Executive Judge Godardo A. Jacinto in his report dated October 16, 1991, came up with the, following findings and recommendation. It was on 8 September, 1988 that respondent Bascar, accompanied by Angel Veloso's lawyer, went to herein complainant [Manuel del Rosario's residence and office in order to serve the writs.] Manuel del Rosario is one of the respondents in the HSRC case and the attorney-in-fact of therein co-respondent Esperanza del Rosario. Upon being requested to comply with the dispositive portion of the judgment, complainant Manuel del Rosario informed respondent Bascar that the lots subject of the HSRC case were no longer available. Thereupon, respondent Bascar went to the Office of the HSRC to check on the titles of the lots, after which he went to the Register of Deeds to look into the status of the lots and their titles. There he discovered that the lots subject of the HSRC case which were previously covered by TCT Nos. 55606 and 55607 had already beenconsolidated and then subdivided into

sublots. Respondent Bascar then made a levy on three (3) of the derivative lots whose combined area would more or less approximate the area of the lots subject of the HSRC judgment. These lots happen to be registered in the name of Miradel Development Corporation. On 12 September ,1988 respondent Bascar made a Return of the writ (Exh. 8-1), in which he gave an account of the steps he took in implementing the writ. He further explained why he levied an the three (3) lots that were registered in the name of the Corporation. His act of levying on the .Corporation's lots led to the present administrative case filed by Manuel del Rosario and his co-respondents in the HSRC case. . . . Findings and Recommendations: Respondent Bascar admitted in his testimony that he erred in levying on the lots of Miradel Development Corporation, but as soon as his attention was invited to such mistake, he filed a Notice of Withdrawal of said levy with the Register of Deeds (Exh. 11). When he was asked why he chose to levy on the three (3) lots that were registered in the name of the Miradel Development Corporation, respondent Bascar explained that it was his honest belief that the said entity was a family corporation of the del Rosarios who were the judgment obligors in the HSRC case. He further stated that his purpose was to preserve the lots subject, of the HSRC case so that they could not be disposed of in avoidance of the judgment in favor of the Velosos. Respondent Bascar also testified that his purpose in levying on the lots was not to satisfy the line of P2,000.00 but only to protect the interests of the prevailing parties in the HSRC case by securing the lots against possibly disposition to other persons. In the perception of the undersigned; respondent Bascar acted in good faith and further, the alleged malice and abuse of authority which the complainants claimed to have visited his acts have not been established. It is important to note that Miradel Development Corporation whose lots were erroneously levied had not complained against respondent Bascar. And there is no showing, that the Corporation suffered any damage or prejudice by reason of respondent's act of levying on its lots which was later on rectified by hip withdrawal or lifting of the notice of levy (Exh. 11). The allegation in the complaint that respondent Bascar did not observe the prescribed procedure for execution and that his act of levying on Miradel Development Corporation's lots worth over a million pesos to satisfy a fine of only P2,000.00 was unnecessary, unreasonable and abusive is not quite tenable. As amply explained by respondent Bascar, his purpose in levying on the three (3) lots was to keep them from being disposed of. He felt it was important to do it since the judgment ordered therein respondents to accept installment payments from the Veloso spouses and to execute the corresponding document of sale as soon as the lots were paid in full. Certainly, the favorable judgment for the Veloso spouses would be frustrated if in the meantime subject lots were transferred to others. According to respondent the lots subject of the contract of sale between the Veloso spouses and the del Rosarios were covered by TCT Nos. 55606 and 55607 and in the Register of Deeds he was informed that the lots had been consolidated and then subdivided and sold to other persons. In levying on the throe (3) lots of the Corporation, respondent Bascar honestly believed that said lots were derived from those that bad been sold on installment in favor of Angel Veloso and unless these were secured from further disposition the judgment in favor of the latter could no longer be executed. Respondent Bascar might have been wrong in. his belief and conclusion, but he cannot be faulted for having done so under the circumstances of the case. It is

noteworthy that complainant Manuel del Rosario exhibited an uncooperative if not antagonistic attitude as he made no attempt to conceal his intention not to abide by the HSRC judgment. In fact, as admitted by complainant Manuel del Rosario he filed a petition for certiorari against the HSRC, et al. praying to have its judgment Annulled (Exh. 1), which action was dismissed by Branch 10 of the RTC of Cebu (Exh. 2). Not satisfied, he filed a complaint for the same purpose, before Branch 12 of the same Court (Exh. 3 ), which also dismissed it (Exh. 4). From there, complainants went up to the Court of Appeals in a Petition for certiorari that was dismissed by said Court (Exh. 5). A similar complaint filed by complainants' questioning the HSRC judgment was filed before Branch 24 of the RTC of Cebu but it was likewise dismissed (Exh. 6). Finally, even as the herein complainants were ordered under the final judgment of the HSRC to accept installment payments for the lots from Angel Veloso (par. 2. Exh. 9), complainant Manuel del Rosario refused to receive such payment, and in his letter of refusal (Exh. 9) he made it clear that he did not recognize the HSRC judgment (tsn, pp. 8-9, July 12, 1991). And not only that. Complainants also did not pay the fine as ordered by the HSRC. As hinted earlier, respondent Bascar's unsolicited act of digging into the papers of incorporation of the Miradel Development Corporation and in proceeding to levy on its lots may have been in reaction to complainant Manuel del Rosario's seeming disregard for the final judgment of the HSRC which it his his (Bascar's), duty to enforce. Certainly, such an act does not amount to gross ignorance of the law, negligence and abuse of authority. It is then respectfully recommended that respondent Jose T. Bascar be merely admonished and warned to be more prudent or discreet in the performance of his duties. Cebu City, Philippines, October, 1991. (pp. 2-4, report). We disagree. The Court does not subscribe to more admonition of respondent deputy sheriff as recommended by the investigating Judge His unjustifiable acts demand sanction. Respondent acted with gross ignorance of the law in making an unreasonable and unnecessary levy in the process of enforcing the writ of execution of a decision ordering specific performance and payment of a fine of P2,000.00. He deviated from what was decreed in the writ by making an unnecessary levy on execution of three lots allegedly forming part of the lots in controversy which were already sold to the Miradel Development Corporation by the complainants. The manner in which respondent conducted the levy leaves no room for doubt that he was unmindful of the rule that in the exercise of his ministerial duty of enforcing writs, it was incumbent upon him to ensure that only that portion of a decision decreed in the dispositive part should be the subject of execution, no more, no less. He made no effort to limit the levy to the amount called for in the writ. Respondent had no reason to make a levy of three parcels of land belonging to Miradel Development Corporation after having found that Esperanza del Rosario, one of the respondents in the HSRC case, was treasurer thereof on the pretext of protecting the prevailing parties whom he claims could eventually lose the lots by reason of the sale thereof by complainants to the said corporation. "It should be recalled that a purely ministerial act or duty is one which an officer or tribunal performs in a given state of facts, on a prescribed manner-in obedience to the mandate of legal authority, without regard to, the exercise of his own judgments, upon the propriety or impropriety of the act done (Lamb v. Phipps, 22 Phils. 456). Discretion, on the other hand, is a faculty conferred upon court or official by which he may decide the question either way and still be right (Asuncion v. De Yriarte, 28, Phil. 67)." 1There is no doubt that respondent acted beyond the bounds of his duty by allocating unto himself the power of the Court to pierce the "veil of corporate"

entity and improvidently assuming that since complainant Esperanza del Rosario is the treasurer of the Miradel Development Corporation, they are one and the same. It is well-settled doctrine both in law and equity that as a legal entity, a corporation has a personality distinct and separate from its individual stockholders or members. The mere fact that one is president of a corporation does not render the property he owns or possesses the property of the corporation, since the president, as individual, and the corporation are separate entities (Cruz v. Dalisay, 152 SCRA 483). More importantly, it was not incumbent upon him as sheriff to determine for himself the means how to safeguard the rights of the prevailing party in a case for specific performance. All that he was called upon to do in such instance his to serve the writ of execution with a certified copy of the judgment requiring specific performance upon the party/parties against whom the same was rendered and in case of failure to abide, it is at the prevailing party's instance not the sheriff's that the aid of' the court may be sought. There was failure, however, to establish with certainty that the actuation of respondent deputy sheriff was attended with malice and was done so as to prejudice a third party. As the respondent explained, he wanted to protect the interest of the prevailing parties over the lots in controversy. Though he erroneously made the levy, the same cannot be looked upon with malicious intent although effected unreasonably. The withdrawal of notice of levy on execution dated, June 9, 1989, filed by the respondent sheriff to rectify his error shows his lack of malice and serves to mitigate his liability. This Court had said before, and reiterates it here, as it has done in other cases, that the conduct and behavior of every one connected with, an office charged with the dispensation of justice, from the presiding justice to the lowest clerk, should be circumscribed with the heavy burden of responsibility. His conduct, at all times, must not only be characterized by propriety and decorum but above all else be above suspicion. 2 Respondent's actuations in enforcing the Writ of Execution in HSRC Case No. REM-0006-210685 did not live up to this strict standard. ACCORDINGLY, a fine of P5,000.00 is hereby imposed on respondent Deputy Sheriff Jose Bascar, Jr., Municipal Trial Court in Cities, Branch 4, Cebu City, for conduct prejudicial to the best interest of the service, payable within thirty (30) days from notice. Respondent s hereby warned that a repetition of the same or of any act calling for disciplinary action, will be dealt with more severely. SO ORDERED. Narvasa, C.J., Cruz and Grio-Aquino, JJ., concur.