G.R. No.

L-19650
September 29, 1966
CALTEX
(PHILIPPINES),
INC., petitioner-appellee,
vs.ENRICO PALOMAR, in his capacity as THE POSTMASTER GENERAL, respondent-appellant.
In the year 1960 the Caltex (Philippines) Inc. (hereinafter referred to as Caltex) conceived and laid the
groundwork for a promotional scheme calculated to drum up patronage for its oil products. Denominated
"Caltex Hooded Pump Contest", it calls for participants therein to estimate the actual number of liters a hooded
gas pump at each Caltex station will dispense during a specified period. Employees of the Caltex (Philippines)
Inc., its dealers and its advertising agency, and their immediate families excepted, participation is to be open
indiscriminately to all "motor vehicle owners and/or licensed drivers". For the privilege to participate, no fee or
consideration is required to be paid, no purchase of Caltex products required to be made. Entry forms are to be
made available upon request at each Caltex station where a sealed can will be provided for the deposit of
accomplished entry stubs.
A three-staged winner selection system is envisioned. At the station level, called "Dealer Contest", the
contestant whose estimate is closest to the actual number of liters dispensed by the hooded pump thereat is to
be awarded the first prize; the next closest, the second; and the next, the third. Prizes at this level consist of a 3burner kerosene stove for first; a thermos bottle and a Ray-O-Vac hunter lantern for second; and an Everready
Magnet-lite flashlight with batteries and a screwdriver set for third. The first-prize winner in each station will
then be qualified to join in the "Regional Contest" in seven different regions. The winning stubs of the qualified
contestants in each region will be deposited in a sealed can from which the first-prize, second-prize and thirdprize winners of that region will be drawn. The regional first-prize winners will be entitled to make a three-day
all-expenses-paid round trip to Manila, accompanied by their respective Caltex dealers, in order to take part in
the "National Contest". The regional second-prize and third-prize winners will receive cash prizes of P500 and
P300, respectively. At the national level, the stubs of the seven regional first-prize winners will be placed inside a
sealed can from which the drawing for the final first-prize, second-prize and third-prize winners will be made.
Cash prizes in store for winners at this final stage are: P3,000 for first; P2,000 for second; Pl,500 for third; and
P650 as consolation prize for each of the remaining four participants.
Foreseeing the extensive use of the mails not only as amongst the media for publicizing the contest but also for
the transmission of communications relative thereto, representations were made by Caltex with the postal
authorities for the contest to be cleared in advance for mailing, having in view sections 1954(a), 1982 and 1983
of the Revised Administrative Code, the pertinent provisions of which read as follows:
SECTION 1954. Absolutely non-mailable matter. No matter belonging to any of the following classes, whether
sealed as first-class matter or not, shall be imported into the Philippines through the mails, or to be deposited in
or carried by the mails of the Philippines, or be delivered to its addressee by any officer or employee of the
Bureau of Posts:Written or printed matter in any form advertising, describing, or in any manner pertaining to, or
conveying or purporting to convey any information concerning any lottery, gift enterprise, or similar scheme
depending in whole or in part upon lot or chance, or any scheme, device, or enterprise for obtaining any money
or property of any kind by means of false or fraudulent pretenses, representations, or promises.
"SECTION 1982. Fraud orders.Upon satisfactory evidence that any person or company is engaged in conducting
any lottery, gift enterprise, or scheme for the distribution of money, or of any real or personal property by lot,
chance, or drawing of any kind, or that any person or company is conducting any scheme, device, or enterprise
for obtaining money or property of any kind through the mails by means of false or fraudulent pretenses,
representations, or promises, the Director of Posts may instruct any postmaster or other officer or employee of
the Bureau to return to the person, depositing the same in the mails, with the word "fraudulent" plainly written
or stamped upon the outside cover thereof, any mail matter of whatever class mailed by or addressed to such
person or company or the representative or agent of such person or company.
SECTION 1983. Deprivation of use of money order system and telegraphic transfer service.The Director of Posts
may, upon evidence satisfactory to him that any person or company is engaged in conducting any lottery, gift
enterprise or scheme for the distribution of money, or of any real or personal property by lot, chance, or drawing
of any kind, or that any person or company is conducting any scheme, device, or enterprise for obtaining money

or property of any kind through the mails by means of false or fraudulent pretenses, representations, or
promise, forbid the issue or payment by any postmaster of any postal money order or telegraphic transfer to
said person or company or to the agent of any such person or company, whether such agent is acting as an
individual or as a firm, bank, corporation, or association of any kind, and may provide by regulation for the
return to the remitters of the sums named in money orders or telegraphic transfers drawn in favor of such
person or company or its agent.
The overtures were later formalized in a letter to the Postmaster General, dated October 31, 1960, in which the
Caltex, thru counsel, enclosed a copy of the contest rules and endeavored to justify its position that the contest
does not violate the anti-lottery provisions of the Postal Law. Unimpressed, the then Acting Postmaster General
opined that the scheme falls within the purview of the provisions aforesaid and declined to grant the requested
clearance. In its counsel's letter of December 7, 1960, Caltex sought a reconsideration of the foregoing stand,
stressing that there being involved no consideration in the part of any contestant, the contest was not, under
controlling authorities, condemnable as a lottery. Relying, however, on an opinion rendered by the Secretary of
Justice on an unrelated case seven years before (Opinion 217, Series of 1953), the Postmaster General
maintained his view that the contest involves consideration, or that, if it does not, it is nevertheless a "gift
enterprise" which is equally banned by the Postal Law, and in his letter of December 10, 1960 not only denied
the use of the mails for purposes of the proposed contest but as well threatened that if the contest was
conducted, "a fraud order will have to be issued against it (Caltex) and all its representatives".
Caltex thereupon invoked judicial intervention by filing the present petition for declaratory relief against
Postmaster General Enrico Palomar, praying "that judgment be rendered declaring its 'Caltex Hooded Pump
Contest' not to be violative of the Postal Law, and ordering respondent to allow petitioner the use of the mails to
bring the contest to the attention of the public". After issues were joined and upon the respective memoranda of
the parties, the trial court rendered judgment as follows:
In view of the foregoing considerations, the Court holds that the proposed 'Caltex Hooded Pump Contest'
announced to be conducted by the petitioner under the rules marked as Annex B of the petitioner does not
violate the Postal Law and the respondent has no right to bar the public distribution of said rules by the mails.
The respondent appealed.
The parties are now before us, arrayed against each other upon two basic issues: first, whether the petition
states a sufficient cause of action for declaratory relief; and second, whether the proposed "Caltex Hooded Pump
Contest" violates the Postal Law. We shall take these up in seriatim.
1. By express mandate of section 1 of Rule 66 of the old Rules of Court, which was the applicable legal basis for
the remedy at the time it was invoked, declaratory relief is available to any person "whose rights are affected by
a statute . . . to determine any question of construction or validity arising under the . . . statute and for a
declaration of his rights thereunder" (now section 1, Rule 64, Revised Rules of Court). In amplification, this Court,
conformably to established jurisprudence on the matter, laid down certain conditions sine qua non therefor, to
wit: (1) there must be a justiciable controversy; (2) the controversy must be between persons whose interests
are adverse; (3) the party seeking declaratory relief must have a legal interest in the controversy; and (4) the
issue involved must be ripe for judicial determination (Tolentino vs. The Board of Accountancy, et al., G.R. No. L3062, September 28, 1951; Delumen, et al. vs. Republic of the Philippines, 50 O.G., No. 2, pp. 576, 578-579;
Edades vs. Edades, et al., G.R. No. L-8964, July 31, 1956). The gravamen of the appellant's stand being that the
petition herein states no sufficient cause of action for declaratory relief, our duty is to assay the factual bases
thereof upon the foregoing crucible.
As we look in retrospect at the incidents that generated the present controversy, a number of significant points
stand out in bold relief. The appellee (Caltex), as a business enterprise of some consequence, concededly has the
unquestioned right to exploit every legitimate means, and to avail of all appropriate media to advertise and
stimulate increased patronage for its products. In contrast, the appellant, as the authority charged with the
enforcement of the Postal Law, admittedly has the power and the duty to suppress transgressions thereof
particularly thru the issuance of fraud orders, under Sections 1982 and 1983 of the Revised Administrative Code,
against legally non-mailable schemes. Obviously pursuing its right aforesaid, the appellee laid out plans for the

sales promotion scheme hereinbefore detailed. To forestall possible difficulties in the dissemination of
information thereon thru the mails, amongst other media, it was found expedient to request the appellant for an
advance clearance therefor. However, likewise by virtue of his jurisdiction in the premises and construing the
pertinent provisions of the Postal Law, the appellant saw a violation thereof in the proposed scheme and
accordingly declined the request. A point of difference as to the correct construction to be given to the
applicable statute was thus reached. Communications in which the parties expounded on their respective
theories were exchanged. The confidence with which the appellee insisted upon its position was matched only
by the obstinacy with which the appellant stood his ground. And this impasse was climaxed by the appellant's
open warning to the appellee that if the proposed contest was "conducted, a fraud order will have to be issued
against it and all its representatives."Against this backdrop, the stage was indeed set for the remedy prayed for.
The appellee's insistent assertion of its claim to the use of the mails for its proposed contest, and the challenge
thereto and consequent denial by the appellant of the privilege demanded, undoubtedly spawned a live
controversy. The justiciability of the dispute cannot be gainsaid. There is an active antagonistic assertion of a
legal right on one side and a denial thereof on the other, concerning a real not a mere theoretical question
or issue. The contenders are as real as their interests are substantial. To the appellee, the uncertainty occasioned
by the divergence of views on the issue of construction hampers or disturbs its freedom to enhance its business.
To the appellant, the suppression of the appellee's proposed contest believed to transgress a law he has sworn
to uphold and enforce is an unavoidable duty. With the appellee's bent to hold the contest and the appellant's
threat to issue a fraud order therefor if carried out, the contenders are confronted by the ominous shadow of an
imminent and inevitable litigation unless their differences are settled and stabilized by a tranquilizing declaration
(Pablo y Sen, et al. vs. Republic of the Philippines, G.R. No. L-6868, April 30, 1955). And, contrary to the
insinuation of the appellant, the time is long past when it can rightly be said that merely the appellee's "desires
are thwarted by its own doubts, or by the fears of others" which admittedly does not confer a cause of action.
Doubt, if any there was, has ripened into a justiciable controversy when, as in the case at bar, it was translated
into a positive claim of right which is actually contested (III Moran, Comments on the Rules of Court, 1963 ed.,
pp. 132-133, citing: Woodward vs. Fox West Coast Theaters, 36 Ariz., 251, 284 Pac. 350).
We cannot hospitably entertain the appellant's pretense that there is here no question of construction because
the said appellant "simply applied the clear provisions of the law to a given set of facts as embodied in the rules
of the contest", hence, there is no room for declaratory relief. The infirmity of this pose lies in the fact that it
proceeds from the assumption that, if the circumstances here presented, the construction of the legal provisions
can be divorced from the matter of their application to the appellee's contest. This is not feasible. Construction,
verily, is the art or process of discovering and expounding the meaning and intention of the authors of the
law with respect to its application to a given case, where that intention is rendered doubtful, amongst others, by
reason of the fact that the given case is not explicitly provided for in the law (Black, Interpretation of Laws, p. 1).
This is precisely the case here. Whether or not the scheme proposed by the appellee is within the coverage of
the prohibitive provisions of the Postal Law inescapably requires an inquiry into the intended meaning of the
words used therein. To our mind, this is as much a question of construction or interpretation as any other.
Nor is it accurate to say, as the appellant intimates, that a pronouncement on the matter at hand can amount to
nothing more than an advisory opinion the handing down of which is anathema to a declaratory relief action. Of
course, no breach of the Postal Law has as yet been committed. Yet, the disagreement over the construction
thereof is no longer nebulous or contingent. It has taken a fixed and final shape, presenting clearly defined legal
issues susceptible of immediate resolution. With the battle lines drawn, in a manner of speaking, the propriety
nay, the necessity of setting the dispute at rest before it accumulates the asperity distemper, animosity,
passion and violence of a full-blown battle which looms ahead (III Moran, Comments on the Rules of Court, 1963
ed., p. 132 and cases cited), cannot but be conceded. Paraphrasing the language in Zeitlin vs. Arnebergh 59 Cal.,
2d., 901, 31 Cal. Rptr., 800, 383 P. 2d., 152, cited in 22 Am. Jur., 2d., p. 869, to deny declaratory relief to the
appellee in the situation into which it has been cast, would be to force it to choose between undesirable
alternatives. If it cannot obtain a final and definitive pronouncement as to whether the anti-lottery provisions of
the Postal Law apply to its proposed contest, it would be faced with these choices: If it launches the contest and

uses the mails for purposes thereof, it not only incurs the risk, but is also actually threatened with the certain
imposition, of a fraud order with its concomitant stigma which may attach even if the appellee will eventually be
vindicated; if it abandons the contest, it becomes a self-appointed censor, or permits the appellant to put into
effect a virtual fiat of previous censorship which is constitutionally unwarranted. As we weigh these
considerations in one equation and in the spirit of liberality with which the Rules of Court are to be interpreted
in order to promote their object (section 1, Rule 1, Revised Rules of Court) which, in the instant case, is to
settle, and afford relief from uncertainty and insecurity with respect to, rights and duties under a law we can
see in the present case any imposition upon our jurisdiction or any futility or prematurity in our intervention.
The appellant, we apprehend, underrates the force and binding effect of the ruling we hand down in this case if
he believes that it will not have the final and pacifying function that a declaratory judgment is calculated to
subserve. At the very least, the appellant will be bound. But more than this, he obviously overlooks that in this
jurisdiction, "Judicial decisions applying or interpreting the law shall form a part of the legal system" (Article 8,
Civil Code of the Philippines). In effect, judicial decisions assume the same authority as the statute itself and,
until authoritatively abandoned, necessarily become, to the extent that they are applicable, the criteria which
must control the actuations not only of those called upon to abide thereby but also of those in duty bound to
enforce obedience thereto. Accordingly, we entertain no misgivings that our resolution of this case will
terminate the controversy at hand.
It is not amiss to point out at this juncture that the conclusion we have herein just reached is not without
precedent. In Liberty Calendar Co. vs. Cohen, 19 N.J., 399, 117 A. 2d., 487, where a corporation engaged in
promotional advertising was advised by the county prosecutor that its proposed sales promotion plan had the
characteristics of a lottery, and that if such sales promotion were conducted, the corporation would be subject
to criminal prosecution, it was held that the corporation was entitled to maintain a declaratory relief action
against the county prosecutor to determine the legality of its sales promotion plan. In pari materia, see
also: Bunis vs. Conway, 17 App. Div. 2d., 207, 234 N.Y.S. 2d., 435; Zeitlin vs. Arnebergh, supra; Thrillo, Inc. vs.
Scott, 15 N.J. Super. 124, 82 A. 2d., 903.
In fine, we hold that the appellee has made out a case for declaratory relief.
2. The Postal Law, chapter 52 of the Revised Administrative Code, using almost identical terminology in sections
1954(a), 1982 and 1983 thereof, supra, condemns as absolutely non-mailable, and empowers the Postmaster
General to issue fraud orders against, or otherwise deny the use of the facilities of the postal service to, any
information concerning "any lottery, gift enterprise, or scheme for the distribution of money, or of any real or
personal property by lot, chance, or drawing of any kind". Upon these words hinges the resolution of the second
issue posed in this appeal.
Happily, this is not an altogether untrodden judicial path. As early as in 1922, in "El Debate", Inc. vs. Topacio, 44
Phil., 278, 283-284, which significantly dwelt on the power of the postal authorities under the abovementioned
provisions of the Postal Law, this Court declared that
While countless definitions of lottery have been attempted, the authoritative one for this jurisdiction is that of
the United States Supreme Court, in analogous cases having to do with the power of the United States
Postmaster General, viz.: The term "lottery" extends to all schemes for the distribution of prizes by chance, such
as policy playing, gift exhibitions, prize concerts, raffles at fairs, etc., and various forms of gambling. The three
essential elements of a lottery are: First, consideration; second, prize; and third, chance. (Horner vs. States
[1892], 147 U.S. 449; Public Clearing House vs. Coyne [1903], 194 U.S., 497; U.S. vs. Filart and Singson [1915], 30
Phil., 80; U.S. vs. Olsen and Marker [1917], 36 Phil., 395; U.S. vs. Baguio [1919], 39 Phil., 962; Valhalla Hotel
Construction Company vs. Carmona, p. 233, ante.)
Unanimity there is in all quarters, and we agree, that the elements of prize and chance are too obvious in the
disputed scheme to be the subject of contention. Consequently as the appellant himself concedes, the field of
inquiry is narrowed down to the existence of the element of consideration therein. Respecting this matter, our
task is considerably lightened inasmuch as in the same case just cited, this Court has laid down a definitive yardstick in the following terms

In respect to the last element of consideration, the law does not condemn the gratuitous distribution of property
by chance, if no consideration is derived directly or indirectly from the party receiving the chance, but does
condemn as criminal schemes in which a valuable consideration of some kind is paid directly or indirectly for the
chance to draw a prize.
Reverting to the rules of the proposed contest, we are struck by the clarity of the language in which the
invitation to participate therein is couched. Thus
No puzzles, no rhymes? You don't need wrappers, labels or boxtops? You don't have to buy anything? Simply
estimate the actual number of liter the Caltex gas pump with the hood at your favorite Caltex dealer will
dispense from to , and win valuable prizes . . . ." .
Nowhere in the said rules is any requirement that any fee be paid, any merchandise be bought, any service be
rendered, or any value whatsoever be given for the privilege to participate. A prospective contestant has but to
go to a Caltex station, request for the entry form which is available on demand, and accomplish and submit the
same for the drawing of the winner. Viewed from all angles or turned inside out, the contest fails to exhibit any
discernible consideration which would brand it as a lottery. Indeed, even as we head the stern injunction, "look
beyond the fair exterior, to the substance, in order to unmask the real element and pernicious tendencies which
the law is seeking to prevent" ("El Debate", Inc. vs. Topacio, supra, p. 291), we find none. In our appraisal, the
scheme does not only appear to be, but actually is, a gratuitous distribution of property by chance.
There is no point to the appellant's insistence that non-Caltex customers who may buy Caltex products simply to
win a prize would actually be indirectly paying a consideration for the privilege to join the contest. Perhaps this
would be tenable if the purchase of any Caltex product or the use of any Caltex service were a pre-requisite to
participation. But it is not. A contestant, it hardly needs reiterating, does not have to buy anything or to give
anything of value.1awphl.ntOff-tangent, too, is the suggestion that the scheme, being admittedly for sales
promotion, would naturally benefit the sponsor in the way of increased patronage by those who will be
encouraged to prefer Caltex products "if only to get the chance to draw a prize by securing entry blanks". The
required element of consideration does not consist of the benefit derived by the proponent of the contest. The
true test, as laid down in People vs. Cardas, 28 P. 2d., 99, 137 Cal. App. (Supp.) 788, is whether the participant
pays a valuable consideration for the chance, and not whether those conducting the enterprise receive
something of value in return for the distribution of the prize. Perspective properly oriented, the standpoint of
the contestant is all that matters, not that of the sponsor. The following, culled from Corpus Juris Secundum,
should set the matter at rest:The fact that the holder of the drawing expects thereby to receive, or in fact does
receive, some benefit in the way of patronage or otherwise, as a result of the drawing; does not supply the
element of consideration.Griffith Amusement Co. vs. Morgan, Tex. Civ. App., 98 S.W., 2d., 844" (54 C.J.S., p. 849).
Thus enlightened, we join the trial court in declaring that the "Caltex Hooded Pump Contest" proposed by the
appellee is not a lottery that may be administratively and adversely dealt with under the Postal Law.
But it may be asked: Is it not at least a "gift enterprise, or scheme for the distribution of money, or of any real or
personal property by lot, chance, or drawing of any kind", which is equally prescribed? Incidentally, while the
appellant's brief appears to have concentrated on the issue of consideration, this aspect of the case cannot be
avoided if the remedy here invoked is to achieve its tranquilizing effect as an instrument of both curative and
preventive justice. Recalling that the appellant's action was predicated, amongst other bases, upon Opinion 217,
Series 1953, of the Secretary of Justice, which opined in effect that a scheme, though not a lottery for want of
consideration, may nevertheless be a gift enterprise in which that element is not essential, the determination of
whether or not the proposed contest wanting in consideration as we have found it to be is a prohibited gift
enterprise, cannot be passed over sub silencio.While an all-embracing concept of the term "gift enterprise" is yet
to be spelled out in explicit words, there appears to be a consensus among lexicographers and standard
authorities that the term is commonly applied to a sporting artifice of under which goods are sold for their
market value but by way of inducement each purchaser is given a chance to win a prize (54 C.J.S., 850; 34 Am.
Jur., 654; Black, Law Dictionary, 4th ed., p. 817; Ballantine, Law Dictionary with Pronunciations, 2nd ed., p. 55;
Retail Section of Chamber of Commerce of Plattsmouth vs. Kieck, 257 N.W., 493, 128 Neb. 13; Barker vs. State,
193 S.E., 605, 56 Ga. App., 705; Bell vs. State, 37 Tenn. 507, 509, 5 Sneed, 507, 509). As thus conceived, the term

clearly cannot embrace the scheme at bar. As already noted, there is no sale of anything to which the chance
offered is attached as an inducement to the purchaser. The contest is open to all qualified contestants
irrespective of whether or not they buy the appellee's products.
Going a step farther, however, and assuming that the appellee's contest can be encompassed within the
broadest sweep that the term "gift enterprise" is capable of being extended, we think that the appellant's pose
will gain no added comfort. As stated in the opinion relied upon, rulings there are indeed holding that a gift
enterprise involving an award by chance, even in default of the element of consideration necessary to constitute
a lottery, is prohibited (E.g.: Crimes vs. States, 235 Ala 192, 178 So. 73; Russell vs. Equitable Loan & Sec. Co., 129
Ga. 154, 58 S.E., 88; State ex rel. Stafford vs. Fox-Great Falls Theater Corporation, 132 P. 2d., 689, 694, 698, 114
Mont. 52). But this is only one side of the coin. Equally impressive authorities declare that, like a lottery, a gift
enterprise comes within the prohibitive statutes only if it exhibits the tripartite elements of prize, chance and
consideration (E.g.: Bills vs. People, 157 P. 2d., 139, 142, 113 Colo., 326; D'Orio vs. Jacobs, 275 P. 563, 565, 151
Wash., 297; People vs. Psallis, 12 N.Y.S., 2d., 796; City and County of Denver vs. Frueauff, 88 P., 389, 394, 39
Colo., 20, 7 L.R.A., N.S., 1131, 12 Ann. Cas., 521; 54 C.J.S., 851, citing: Barker vs. State, 193 S.E., 605, 607, 56 Ga.
App., 705; 18 Words and Phrases, perm. ed., pp. 590-594). The apparent conflict of opinions is explained by the
fact that the specific statutory provisions relied upon are not identical. In some cases, as pointed out in 54 C.J.S.,
851, the terms "lottery" and "gift enterprise" are used interchangeably (Bills vs. People, supra); in others, the
necessity for the element of consideration or chance has been specifically eliminated by statute. (54 C.J.S., 351352, citing Barker vs. State, supra; State ex rel. Stafford vs. Fox-Great Falls Theater Corporation, supra). The
lesson that we derive from this state of the pertinent jurisprudence is, therefore, that every case must be
resolved upon the particular phraseology of the applicable statutory provision.
Taking this cue, we note that in the Postal Law, the term in question is used in association with the word
"lottery". With the meaning of lottery settled, and consonant to the well-known principle of legal
hermeneutics noscitur a sociis which Opinion 217 aforesaid also relied upon although only insofar as the
element of chance is concerned it is only logical that the term under a construction should be accorded no
other meaning than that which is consistent with the nature of the word associated therewith. Hence, if lottery
is prohibited only if it involves a consideration, so also must the term "gift enterprise" be so construed.
Significantly, there is not in the law the slightest indicium of any intent to eliminate that element of
consideration from the "gift enterprise" therein included.This conclusion firms up in the light of the mischief
sought to be remedied by the law, resort to the determination thereof being an accepted extrinsic aid in
statutory construction. Mail fraud orders, it is axiomatic, are designed to prevent the use of the mails as a
medium for disseminating printed matters which on grounds of public policy are declared non-mailable. As
applied to lotteries, gift enterprises and similar schemes, justification lies in the recognized necessity to suppress
their tendency to inflame the gambling spirit and to corrupt public morals (Com. vs. Lund, 15 A. 2d., 839, 143 Pa.
Super. 208). Since in gambling it is inherent that something of value be hazarded for a chance to gain a larger
amount, it follows ineluctably that where no consideration is paid by the contestant to participate, the reason
behind the law can hardly be said to obtain. If, as it has been held Gratuitous distribution of property by lot or
chance does not constitute "lottery", if it is not resorted to as a device to evade the law and no consideration is
derived, directly or indirectly, from the party receiving the chance, gambling spirit not being cultivated or
stimulated thereby. City of Roswell vs. Jones, 67 P. 2d., 286, 41 N.M., 258." (25 Words and Phrases, perm. ed., p.
695, emphasis supplied).we find no obstacle in saying the same respecting a gift enterprise. In the end, we are
persuaded to hold that, under the prohibitive provisions of the Postal Law which we have heretofore examined,
gift enterprises and similar schemes therein contemplated are condemnable only if, like lotteries, they involve
the element of consideration. Finding none in the contest here in question, we rule that the appellee may not be
denied the use of the mails for purposes thereof.
Recapitulating, we hold that the petition herein states a sufficient cause of action for declaratory relief, and that
the "Caltex Hooded Pump Contest" as described in the rules submitted by the appellee does not transgress the
provisions of the Postal Law.
ACCORDINGLY, the judgment appealed from is affirmed. No costs.

[G.R. No. 154093. July 8, 2003]

GOVERNMENT SERVICE INSURANCE SYSTEM, petitioner, vs. LEO L. CADIZ, respondent.
Permanent total disability does not mean a state of absolute helplessness, but means disablement of an
employee to earn wages in the same kind of work, or work of similar nature, that he was trained for, or any work
[1]
which a person of similar mentality and attainment could do.
[2]
Assailed in this petition for review is the decision of the Court of Appeals in CA-G.R. SP No. 63521, which set
aside the decision of the Employees Compensation Commission and granted respondents claim for permanent
total disability compensation benefits.
The undisputed facts are as follows: respondent Leo L. Cadiz was appointed as a Provincial Guard of Negros
Oriental on July 1, 1968. On March 16, 1974, he entered the police service and was promoted to several ranks
until he became a Police Major. In 1991, he was absorbed by the Philippine National Police (PNP), with a rank of
Police Chief Inspector. On July 17, 1992, respondents rank was adjusted to Police Chief Superintendent, the
[3]
position he held until his retirement on March 19, 1999 at the age of 55. The medical records of respondent
revealed that on October 11, 1996, he suffered a heart attack and was hospitalized at the San Carlos Planters
Hospital, San Carlos City. He was transferred to the Siliman University Medical Center where he was diagnosed
[4]
to be suffering from AF with CHF Class 1-E T/A Sec. to Cardio embolic Sec. to AF, Chronic CAD, a heart
ailment. Thereafter, respondent was also admitted at the Negros Oriental Provincial Hospital for chest pain,
[5]
palpitation and abnormal beats HP..., AF, CHF Class I; Hypercholesterolemia. Consequently, he applied for
early retirement due to an ailment causing [paralysis of the] left hand and [slurred] speechrendering him unfit
[6]
to discharge further his duties and responsibilities as a police officer. Dr. Silahis Rosario, a cardiologist and
attending physician of respondent, testified before the National Police Commission that the latters ailment is
unstable angina and chronic atriol fibrillation, which means a chronic irregularity of the heart causing a
[7]
congestive heart failure. After its own examination of respondent, the Medical and Dental Service, PNP,
[8]
declared him UNFIT FOR POLICE SERVICE. Hence, on March 19, 1999, he was retired from service and
[9]
granted permanent total disability benefits. Subsequently, respondent filed a disability claim with the GSIS,
attaching to his application his service record and PNP General Order No. 641, stating that respondent retired
[10]
from the PNP due to a permanent total disability. On November 25, 1999, Dr. Gervillana B. Estrada, Medical
Officer of GSIS, Dumaguete City, approved the claim and granted respondent permanent total disability benefits
[11]
starting March 19, 1999, and temporary total disability benefits from October 12, 1996 to November 22, 1996.
The Medical Service Group of GSIS, Pasay City, however, directed Dr. Estrada to revise her recommendation,
thus [k]indly revise your medical recommendation based on our criteria for granting of disability. Based on
your physical examination (8/23/99) done the degree of claimants disability, does not satisfy the criteria for
[12]
PTD. We are returning these claim for re-evaluation under PD 626. On January 29, 2000, Dr. Estrada modified
her recommendation by retaining respondents temporary total disability benefits from October 12, 1996 to
November 22, 1996, but downgrading the permanent total disability benefits to compensation equivalent to 8
[13]
months permanent partial disability benefits from March 19, 1999. Respondent moved for reconsideration of
the evaluation but the same was denied.On appeal by respondent, the Employees Compensation Commission
(ECC) affirmed the findings of the GSIS. Hence, respondent filed a petition with the Court of Appeals which, on
June 21, 2002, rendered a decision setting aside the decision of the ECC and granting respondents claim for
permanent total disability. The dispositive portion thereof reads:
WHEREFORE, the petition for review is GRANTED. The challenged decisions of the ECC and the GSIS are
ANNULLED and SET ASIDE, and another [one is] entered declaring the petitioner to be suffering from permanent
total disability. Respondent ECC is accordingly ordered to award the petitioner the full benefits corresponding to
his permanent total disability. Without costs.
[14]
SO ORDERED. On September 3, 2002, GSIS, as the agency charged with the management and administration of
the trust fund of the ECC, filed the instant petition.Is respondent entitled to permanent total disability benefits?
We rule in the affirmative. In denying respondents claim for permanent total disability benefits, the ECC held:
Based on the ECC Schedule of Compensation, appellant was already awarded the maximum benefits
commensurate to the degree of his disability. Moreover, the primary criterion set for permanent total disability

in this case was not met, that is: permanent paralysis of two limbs; complete loss of sight of both eyes; brain
injury resulting in incurable imbecility; and loss of two limbs at or above the ankle or wrist.
Since appellant was already awarded the maximum benefits prevailing at the time of his compulsory retirement,
[15]
he is no longer entitled to additional benefits under PD 626, as amended.
Clearly, the ECC did not state its reason for declaring that the benefits awarded by the GSIS to respondent are
those that are commensurate to the degree of his disability. The fact that the latter did not lose the use of any
part of his body does not justify the denial of his claim for permanent total disability. In Government Service
[16]
Insurance System v. Court of Appeals, it was held that while permanent total disability invariably results in an
employees loss of work or inability to perform his usual work, permanent partial disability occurs when an
employee loses the use of any particular anatomical part of his body which disables him to continue with his
former work. Stated otherwise, the test of whether or not an employee suffers from permanent total disability
is the capacity of the employee to continue performing his work notwithstanding the disability he incurred. If by
reason of the injury or sickness he sustained, the employee is unable to perform his customary job for more than
120 days and he does not come within the coverage of Rule X of the Amended Rules on Employees
Compensability (which, in a more detailed manner, describes what constitutes temporary total disability), then
the said employee undoubtedly suffers from a permanent total disability regardless of whether or not he loses
the use of any part of his body. Permanent total disability does not mean a state of absolute helplessness, but
means disablement of an employee to earn wages in the same kind of work, or work of similar nature, that he
[17]
was trained for, or any work which a person of similar mentality and attainment could do.
In the case at bar, respondents entitlement to permanent total disability was established by his medical records
and by the investigation of the very agency he worked for, the PNP, which found him UNFIT FOR POLICE
[18]
SERVICE. Even the initial findings of Dr. Gervillana B. Estrada, Medical Officer of the GSIS, Dumaguete City
evinced that respondent is really qualified for permanent total disability benefits. Most of all, the decision of the
PNP to retire him at the age of 55 for being unfit for police service is a clear indication that his heart ailment
rendered him incapable of effectively and competently performing his job as a Police Chief Superintendent
[19]
[20]
without serious discomfort or pain and without material injury or danger to his life. In a number of cases, it
was ruled that the early retirement of an employee due to a work-related ailment, as in the case at bar, proves
that he was really disabled totally to further perform his assigned task, and to deny permanent total disability
benefits when he was forced to retire would render inutile and meaningless the social justice precept
[21]
guaranteed by the Constitution.The case of Tria v. Employees Compensation Commission, where we denied a
claim for conversion of disability benefits, is not applicable to the instant case. The claim therein, which was
filed 4 years after the employees retirement, refers to a claim for conversion of a previously granted disability
benefit from permanent partial to permanent total on the ground of an alleged recurring illness. The case at bar,
however, neither concerns a recurring illness previously compensated, nor a claim for additional/conversion of
disability benefits, but involves a review of the ECC decision which classified respondents early-retirement[22]
causing disability as permanent partial instead of permanent total. As to the decisions of the Court of Appeals
cited by petitioner as authorities, it must be stressed that judicial decisions which form part of our legal system
are only the decisions of the Supreme Court. While rulings of the Court of Appeals may serve as precedents for
[23]
lower courts, they only apply to points of law not covered by any Supreme Court decision. This is not,
however, the case here, considering that the legal issue presented is already laid to rest by settled
jurisprudence. Significantly, one of the Court of Appeals cases cited by petitioner Ijares v. Employees
Compensation Commission (CA-G.R. SP No. 26910, April 13, 1992) was reversed by this Court on August 26, 1999,
in G.R. No. 105854. There, we held that the early retirement of an employee at the age of 60 by reason of a
work-related illness justifies the award of permanent total disability benefits.
WHEREFORE, in view of all the foregoing, the Decision of the Court of Appeals in CA-G.R. SP No. 63521, declaring
respondent Leo L. Cadiz to be suffering from a permanent total disability and ordering the Employees
Compensation Commission to award him the full benefits corresponding to his disability, is AFFIRMED in toto.
SO ORDERED.

G.R. NO. 159422

March 28, 2008
CHINESE YOUNG MEN'S CHRISTIAN ASSOCIATION OF THE PHILIPPINE ISLANDS, doing business under the name
of
MANILA
DOWNTOWN
YMCA, Petitioner,
vs.
REMINGTON STEEL CORPORATION, Respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
Before the Court is a Petition for Review on Certiorari under Rule 45 of the Rules of Court assailing the
1
Resolution dated January 16, 2003 of the Court of Appeals (CA) in CA-G.R. SP No. 74292 which dismissed
outright petitioner's Petition for Review for failure to show proof of authority of the signatory to the Verification
and Certification of Non-Forum Shopping, and
2
the CA Resolution dated July 29, 2003 which denied petitioner's Motion for Reconsideration thereof.
The antecedent facts of the petition are as follows:
3
Remington Steel Corporation (Remington) leased ground floor units 964 and 966 and second floor unit 963 of a
building owned by the Manila Downtown YMCA (YMCA) in Benavidez St., Binondo, Manila. Remington used the
combined areas of ground floor units 964 and 966 as hardware store, offices, and display shops for its steel
products, as well as a passageway to second floor unit 963 which was used as staff room for its Manila sales
force.
On February 27, 1997, YMCA formally terminated the lease over second floor unit 963 and gave Remington until
March 31, 1997 to vacate the premises. On March 24, 1997, Remington filed with the Metropolitan Trial Court
(MeTC) , Manila a case for the Fixing of Lease Period over unit 963, docketed as Civil Case No. 154969-CV. On
April 8, 1997, YMCA filed in the same court an action for Unlawful Detainer involving the same unit 963 against
Remington, docketed as Civil Case No. 155083-CV. The two cases were consolidated before Branch 26 of MeTCManila (MeTC-Branch 26).
During the pendency of Civil Case Nos. 154969-CV and 155083-CV, Remington filed a Petition for Consignation of
Rentals on the ground that YMCA refused to receive rentals for ground floor units 964 and 966, docketed as Civil
Case No. 155897 and assigned to Branch 24 of MeTC-Manila (MeTC-Branch 24). On June 23, 1998, Remington
4
filed a Formal Surrender of the Leased Premises, opting to surrender possession of units 964 and 966 effective
July 1, 1998 and tendering two checks to cover all past rentals due on the two units. On June 25, 1998, YMCA
5
filed a No Objection to the Turn Over of the Leased Premises at #964 and 966 Benavidez St., Binondo, Manila. On
6
July 9, 1998, MeTC- Branch 24 issued an Order declaring the consignation case closed.
Remington, however, continued to use ground floor units 964 and 966 as passageway to second floor unit 963. It
kept the premises padlocked and failed to give YMCA the keys to the premises.
On August 11, 1998, MeTC-Branch 26 rendered a Decision in Civil Case Nos. 154969-CV and 155083-CV
extending for three years from finality of the decision the lease period on second floor unit 963 and dismissed
YMCA's complaint for ejectment.
On August 21, 1998, Remington filed in MeTC-Branch 26 a Motion to Constitute Passageway alleging that it had
no means of ingress or egress to second floor unit 963. MeTC-Branch 26 assigned a Commissioner to conduct an
ocular inspection. He reported that Remington was still in possession of the keys to ground floor units 964 and
966 because YMCA failed to provide an adequate passageway to second floor unit 963. The issue on the
passageway, however, was not resolved by MeTC-Branch 26, for it had to forward the records of the case to
Branch 30, Regional Trial Court, Manila (RTC-Branch 30) in connection with the appeals taken by the parties from
its decision, docketed as Civil Case Nos. 99-93836 and 99-93837.
7
On March 15, 2000, RTC-Branch 30, acting as an appellate court, rendered a Decision in Civil Case Nos. 99-93836
and 99-93837 granting Remington a longer extension period of five years for second floor unit 963 and ordering
YMCA to provide a two-meter passageway between units 964 and 966.
Dissatisfied, YMCA filed an appeal with the CA, docketed as CA-G.R. SP No. 58957. On September 19, 2003, the
CA held that the lower courts had authority to fix an extension of the lease period. It found that although the
lease contract had expired, Remington's continued occupation of unit 963 resulted in a new lease on a month-to-

month basis, which subsisted for over a year; thus, while YMCA had the right to seek its termination, Remington
was entitled to a judicial lengthening of its period based on equity. Nonetheless, the CA ordered Remington to
vacate the premises, as the continuation of the lease was no longer tenable after the lapse of six years, since the
parties' formal contract had expired. It also noted that since Remington had already transferred to its own
building, there was no more reason to continue the lease. Remington filed a Motion for Reconsideration, which
the CA considered as moot, for Remington had vacated the premises.
In the meantime that CA-G.R. SP No. 58957 was pending, YMCA filed in MeTC-Manila two separate complaints
8
for unlawful detainer to evict Remington from ground floor units 964 and 966, docketed as Civil Case Nos.
168629-CV and 168628-CV, respectively. Civil Case No. 168629-CV was raffled to Branch 20, while Civil Case No.
168628-CV was raffled to Branch 17. Upon Remington's motion, the two cases were consolidated. However,
when YMCA filed a motion for reconsideration, the consolidation of cases was reversed and canceled. Thus, the
cases were tried separately.
YMCA contended in both cases that Remington did not surrender the ground floor units but padlocked the
doors, refused to surrender the keys, and failed to pay rent therefor demand.
Remington countered that it vacated and surrendered ground floor units 964 and 966 on July 1, 1998; that
although it had the doors of the units locked, it did so only as an act of self-preservation, since it had a valid lease
on second floor unit 963, and YMCA refused to heed the order of the court to provide a passageway to the
second floor; that, if it were true that no turnover of ground floor units 964 and 966 was made, YMCA had the
remedy of filing the appropriate motion in the consignation case, where the parties agreed on such turnover;
9
and that the fact that it did not complain shows completion of such turnover.
Both branches of MeTC-Manila separately ordered Remington to vacate the premises and to pay reasonable rent
10
and attorney's fees to YMCA.
Remington separately appealed both decisions to the Regional Trial Court, Manila (RTC-Manila). Its appeal from
MeTC-Manila, Branch 20 was docketed as Civil Case No. 01-102435 and assigned to Branch 40, while the appeal
from MeTC-Manila Branch 17 was docketed as Civil Case No. 03-107655 and assigned to Branch 25. Branches 40
and 25 of RTC-Manila separately reversed the respective decisions of MeTC-Manila and dismissed the two
11
complaints for unlawful detainer. YMCA filed separate motions for
12
13
reconsideration which were denied.
14
YMCA then filed separate petitions for review in the CA, docketed as CA-G.R SP Nos. 74292 and 88599.
15
On January 16, 2003, the CA issued a Resolution dismissing outright the petition for review in CA-G.R. SP No.
74292 involving unit 964 on the ground that William Golangco, the signatory to the Verification and Certification
on Non-Forum Shopping, failed to show his proof of authority to file the petition for review.
16
On February 10, 2003, YMCA filed a Motion for Reconsideration therein, appending thereto a Secretary's
17
Certificate dated December 26, 2002 executed by YMCA's Corporate Secretary attesting to a December 13,
2002 Resolution of the Board of Directors authorizing William Golangco to prepare and file the petition for
review.
18
On July 29, 2003, the CA issued a Resolution denying YMCA's motion for reconsideration. Citing Spouses Melo
19
v. Court of Appeals, the CA underscored the mandatory nature of the requirement that the Certification of
Non-Forum Shopping should be annexed to, or simultaneously filed with the petition and that subsequent
compliance therewith cannot excuse a party's failure to comply in the first instance.
Hence, the present petition involving only unit 964 anchored on the following ground:
THE HONORABLE COURT OF APPEALS ERRED IN DISMISSING THE PETITION RAISED BEFORE IT WHEN IT FOUND
THAT THE PETITIONER FAILED TO SUBMIT THE AUTHORITY OF THE AFFIANT WHO SIGNED FOR THE PETITIONER
CORPORATION AND THE SUBSEQUENT SUBMISSION OF THE SECRETARY'S CERTIFICATE DID NOT CURE SAID
20
DEFECT IN THE CERTIFICATION AGAINST FORUM SHOPPING.
YMCA argues that the rules do not require that the filing of the Verification and Certification of Non-Forum
Shopping should include therewith the authorization of the person signing the same; that Melo does not apply,
since it involves the total failure to append to the petition a Verification and Certification of Non-Forum
Shopping; that recent cases of this Court, while upholding the need to present the authority of the person

signing the Verification and Certification of Non-Forum Shopping in case the party litigant is not a natural person,
emphasize that its late submission is not fatal.
Remington, on the other hand, contends that YMCA is required at the time of the filing of its petition to show
that the person signing the Verification and Certification of Non-Forum Shopping on its behalf had proper
authority to do so; that subsequent compliance would encourage parties to make light of the requirements of
petitions for review.
Sections 1 and 2, Rule 42 of the Rules of Court require that a petition for review filed with the CA should be
verified and should contain a certificate of non-forum shopping, to wit:
SEC. 1. How appeal taken; time for filing. - A party desiring to appeal from a decision of the Regional Trial Court
rendered in the exercise of its appellate jurisdiction may file a verified petition for review with the Court of
Appeals x x x.
SEC. 2. Form and contents. - The petition shall be filed in seven (7) legible copies, with the original copy intended
for the court being indicated as such by the petitioner, x x x.
The petitioner shall also submit together with the petition a certification under oath that he has not theretofore
commenced any other action involving the same issues in the Supreme Court, the Court of Appeals or different
divisions thereof, or any other tribunal or agency; if there is such other action or proceeding, he must state the
status of the same; and if he should thereafter learn that a similar action or proceeding has been filed or is
pending before the Supreme Court, the Court of Appeals, or different divisions thereof, or any other tribunal or
agency, he undertakes to promptly inform the aforesaid courts and other tribunal or agency thereof within five
(5) days therefrom. (Emphasis supplied)
These requirements are mandatory, and failure to comply therewith is sufficient ground for the dismissal of the
21
petition. The requirement that the petitioner should sign the Verification and Certification of Non-Forum
Shopping applies even to corporations, considering that the mandatory directives of the Rules of Court make no
22
distinction between natural and juridical persons.
Except for the powers which are expressly conferred on it by the Corporation Code and those that are implied by
or are incidental to its existence, a corporation has no powers. It exercises its powers through its board of
23
directors and/or its duly authorized officers and agents. Thus, its power to sue and be sued in any court is
24
lodged with the board of directors that exercises its corporate powers. Physical acts, like the signing of
documents, can be performed only by natural persons duly authorized for the purpose by corporate by-laws or
25
by a specific act of the board of directors.
The purpose of requiring a verification is to secure an assurance that the allegations of the petition have been
26
made in good faith, or are true and correct, not merely speculative. On the other hand, the rule against forum
shopping is rooted in the principle that a party-litigant shall not be allowed to pursue simultaneous remedies in
27
different fora, as this practice is detrimental to orderly judicial procedure.
A distinction must be made between non-compliance with the requirements for Verification and Certification of
Non-Forum Shopping. As to Verification, non-compliance therewith does not necessarily render the pleading
fatally defective; hence, the court may order its correction if verification is lacking, or act on the pleading
although it is not verified, if the attending circumstances are such that strict compliance with the Rules may be
28
dispensed with in order that the ends of justice may thereby be served. On the other hand, the lack of
certification of non-forum shopping is generally not curable by the submission thereof after the filing of the
29
petition. The submission of a certificate against forum shopping is thus deemed obligatory, albeit not
30
jurisdictional. However, jurisprudence instructs that the rule on certification against forum shopping may be
31
relaxed on grounds of "substantial compliance" or "special circumstance or compelling reasons."
32
In Shipside Incorporated v. Court of Appeals, the petitioner had not attached any proof that its resident
manager was authorized to sign the Verification and Certification of Non-Forum Shopping, as a consequence of
which, the petition was dismissed by the CA. Subsequent to the dismissal, however, the petitioner filed a motion
for reconsideration, to which was attached a Certificate issued by its board secretary who stated that, prior to
the filing of the petition, the resident manager had been authorized by the board of directors to file the petition.
The Court recognized therein the abundance of cases excusing non-compliance with the requirement of a

certification of non-forum shopping and held that with more reason should a petition be given due course when
it incorporates a certification of non-forum shopping without evidence that the person signing the certification
was an authorized signatory and the petitioner subsequently submits a secretarys certificate attesting to the
signatorys authority in its motion for reconsideration.
33
Similarly, in Havtor Management Philippines Inc. v. National Labor Relations Commission, the Court
acknowledged substantial compliance when the lacking secretarys certificate was submitted by the petitioners
as an attachment to the motion for reconsideration seeking reversal of the original decision dismissing the
petition for its earlier failure to submit such requirement.
34
Likewise, in General Milling Corporation v. National Labor Relations Commission, the CA dismissed the petition,
which was not accompanied by any board resolution or certification by the corporate secretary that the person
who signed the Certification of Non-Forum Shopping was duly authorized to represent the petitioner
corporation. In the Motion for Reconsideration, however, the petitioner attached a board resolution stating that
the signatory of the Certification had been duly authorized to do so. The Court deemed as substantial
compliance the belated attachment to the motion for reconsideration the board resolution or the secretarys
certificate, stating that there was no attempt on the part of the petitioner to ignore the prescribed procedural
requirements.
The ruling in these cases has been repeatedly reiterated in subsequent cases: Pascual and Santos, Inc. v. The
35
Members of the Tramo Wakas Neighborhood Association, Wack Wack Golf and Country Club v. National Labor
36
37
Relations Commission, Vicar International Construction, Inc. v. FEB Leasing and Finance Corporation, Ateneo
38
39
De Naga University v. Manalo, China Banking Corporation v. Mondragon International Philippines, Inc., LDP
40
41
Marketing, Inc. v. Monter, Varorient Shipping Co., Inc. v. National Labor Relations Commission, and most
42
recently in Cana v. Evangelical Free Church of the Philippines, and continues to be the controlling doctrine.
As in the aforementioned cases, YMCA rectified its failure to submit proof of Golangco's authority to sign the
Verification and Certification on Non-Forum Shopping on its behalf when it attached in its Motion for
Reconsideration a Secretary's Certificate issued by its Corporate Secretary stating that on December 13, 2002, or
prior to the filing of the petition on December 27, 2002, Golangco had been authorized by YMCA's Board of
Directors to file the petition before the CA.
Thus, the CA's reliance on Melo was misplaced. That case involved a total failure to append to the petition a
verification and certification of non-forum shopping, unlike the present case in which YMCA timely filed a
Verification and Certification of Non-Forum Shopping, but merely failed to submit proof of authority of the
signatory to sign the same.
While the requirement of the certificate of non-forum shopping is mandatory, nonetheless the requirement
must not be interpreted too literally as to defeat the objective of preventing the undesirable practice of forum
43
shopping.
Accordingly, the CA committed an error in dismissing outright YMCA's petition for review for failure to attach a
proof of authority of the signatory to the Verification and Certification of Non-Forum Shopping.
44
Ordinarily, the Court would remand the case to the CA for proper disposition of the petition on the merits. The
particular surrounding facts and circumstances in the present case, however, prevent the Court from doing so. In
the meantime that the present petition was pending, the CA rendered a Decision dated October 17, 2005 in CAG.R SP No. 88599, involving ground floor unit 966 reversing the Decision of RTC-Branch 25 and reinstating the
Decision of MeTC-Branch 17 on YMCA's complaint for unlawful detainer. When Remington's motion for
reconsideration was denied, it filed a petition for review on certiorari with this Court, entitiled "Remington
IndustrialSales Corporation v. Chinese Young Mens Christian Association of the Philippine Islands, doing business
45
under the name Manila Downtown YMCA," docketed as G.R. No. 171858. On January 22, 2007, the Court
46
rendered a Decision granting the petition and dismissing the unlawful detainer case involving ground floor unit
966. However, upon YMCA's motion for reconsideration, the Court issued a Resolution dated August 31, 2007
setting aside its January 22, 2007 Decision and reinstating the Decision of MeTC-Branch 17 with the modification
that Remington was ordered to pay YMCA P11,000.00 a month from July 1, 1998 until March 12, 2004 as
47
reasonable compensation for the use of the premises. The Court held therein:

The filing of the Formal Surrender of Leased Premises and the actual emptying of the premises constitute
constructive delivery of possession. Hence, the contract of lease was terminated on July 1, 1998 and it is
incumbent upon petitioner, as lessee, to comply with its obligation to return the thing leased to the lessor and
vacate the premises.
However, [Remington] failed to comply with its obligation to return the premises to [YMCA]. In order to return
the thing leased to the lessor, it is not enough that the lessee vacates it. It is necessary that he places the thing at
the disposal of the lessor, so that the latter can receive it without any obstacle. He must return the keys and
leave no sub-lessees or other persons in the property; otherwise he shall continue to be liable for rents.
[Remingtons] constructive delivery of the premises did not produce the effect of actual delivery to the
[YMCA]. To be effective, it is necessary that the person to whom the delivery is made must be able to take
control of it without impediment especially from the person who supposedly made such delivery. In the case at
bar, records show that despite the termination of the lease, [YMCA] was never in possession of the premises
because it was padlocked. [YMCA] was not given the key to the premises hence it was deprived to use the same
as it pleases.
Although the use of the premises as passageway was justified, [Remington] cannot deprive [YMCA] the use of
the said premises by having it padlocked. Other than simply repudiating the demand for back rentals,
[Remington] should have given [YMCA] a set of keys so it can enter the premises without exposing the property
to security risks. Prudence dictates the delivery of the keys to [YMCA] to dispel any doubt that [Remington] is
using the premises other than as a mere passageway and that it has never withheld possession of the same to
the [YMCA]. [Remington] had several opportunities to give [YMCA] access to the premises starting from the time
it sent its first demand to pay back rentals until the complaint for ejectment was filed but it never availed of
these opportunities.1avvphi1
From the foregoing, it is apparent that [Remingtons] constructive delivery did not effectively transfer
possession of the leased premises to [YMCA]. From the time the lease was terminated, [Remington]
unlawfully withheld possession of the leased premises from [YMCA]. However, it appears that [Remington] had
moved out from [YMCAs] building on March 12, 2004, as stated in its Manifestation before Branch 25 of the
RTC-Manila. [YMCA] is entitled to a reasonable compensation for [Remingtons] continued occupancy of the
premises despite termination of the lease from July 1, 1998 to March 12, 2004.
Under Section 17, Rule 70 of the Rules of Court, the trial court may award reasonable compensation for the use
and occupation of the leased premises after the same is duly proved. In Asian Transmission Corporation v.
Canlubang Sugar Estates, the Court ruled that the reasonable compensation contemplated under said Rule
partakes of the nature of actual damages based on the evidence adduced by the parties. The Court also ruled
that "fair rental value is defined as the amount at which a willing lessee would pay and a willing lessor would
receive for the use of a certain property, neither being under compulsion and both parties having a reasonable
knowledge of all facts, such as the extent, character and utility of the property, sales and holding prices of similar
land and the highest and best use of the property."
The reasonable compensation for the leased premises fixed by the trial court based on the stipulated rent under
the lease contract which is P22,531.00, must be equitably reduced in view of the circumstances attendant in the
case at bar. First, it should be noted that the premises was used only as a means of passageway caused by
[YMCAs] failure to provide sufficient passageway towards the second floor unit it also occupies. Second, [YMCA]
was negligent because it waited for more than a year before it actually demanded payment for back rentals as
reflected in its Statement of Accounts dated September 7, 1999. When both parties to a transaction are mutually
negligent in the performance of their obligations, the fault of one cancels the negligence of the other and, as in
this case, their rights and obligations may be determined equitably under the law proscribing unjust enrichment.
From the foregoing, we find the amount of P11,000.00 a month equitable and reasonable compensation for
48
petitioners continued use of the premises. (Emphasis supplied)
Remington filed a Motion for Reconsideration therein but it was denied with finality in a Resolution dated
November 12, 2007. Remington subsequently filed a Motion for Leave to File Second Motion for Reconsideration

but it was denied for lack of merit in a Resolution dated February 6, 2008, ordering entry of judgment. Thus, the
resolution in that case has become final and executory.
The final Resolution dated August 31, 2007 in G.R. No. 171858 is binding and applicable to the present case
following the salutary doctrine of stare decisis et non quieta movere which means "to adhere to precedents, and
49
not to unsettle things which are established." Under the doctrine, when the Supreme Court has once laid down
a principle of law as applicable to a certain state of facts, it will adhere to that principle, and apply it to all future
50
cases, where facts are substantially the same. The doctrine of stare decisis is based upon the legal principle or
rule involved and not upon judgment which results therefrom. In this particular sense stare decisis differs
51
from res judicata which is based upon the judgment.
The doctrine of stare decisis is one of policy grounded on the necessity for securing certainty and stability of
judicial decisions, thus:
Time and again, the court has held that it is a very desirable and necessary judicial practice that when a court has
laid down a principle of law as applicable to a certain state of facts, it will adhere to that principle and apply it to
all future cases in which the facts are substantially the same. Stare decisis et non quieta movere. Stand by the
decisions and disturb not what is settled. Stare decisis simply means that for the sake of certainty, a conclusion
reached in one case should be applied to those that follow if the facts are substantially the same, even though
the parties may be different. It proceeds from the first principle of justice that, absent any powerful
countervailing considerations, like cases ought to be decided alike. Thus, where the same questions relating to
the same event have been put forward by the parties similarly situated as in a previous case litigated and
52
decided by a competent court, the rule of stare decisis is a bar to any attempt to relitigate the same issue.
It bears stressing that the facts of the present case and those of G.R. No. 171858 are substantially the same. The
only difference is the unit involved; G.R. No. 171858 involves unit 966 while the present case involves unit 964.
The opposing parties are likewise the same. Clearly, in the light of the final Resolution dated August 31, 2007 in
G.R. No. 171858, which the Court follows as precedent, Remington unlawfully withheld possession of the leased
premises because its constructive delivery did not amount to an effective transfer of possession to YMCA. It is
the Courts duty to apply the previous ruling in the final Resolution dated August 31, 2007 in G.R. No. 171858 to
the instant case. Once a case has been decided one way, any other case involving exactly the same point at issue,
53
as in the present case, should be decided in the same manner.
WHEREFORE, the Court GRANTS herein petition insofar as the outright dismissal of CA-G.R. SP No. 74292 is
concerned. The Resolutions dated January 16, 2003 and July 29, 2003 of the Court of Appeals
are REVERSEDand SET ASIDE. The final Resolution dated August 31, 2007 of the Court in G.R. No. 171858 shall
likewise govern the rights of the parties insofar as unit 964 is concerned.
SO ORDERED.

G.R. No. 147097

June 5, 2009
CARMELO F. LAZATIN, MARINO A. MORALES, TEODORO L. DAVID and ANGELITO A. PELAYO, Petitioner,
vs.HON. ANIANO A. DESIERTO as OMBUDSMAN, and SANDIGANBAYAN, THIRD DIVISION, Respondents.
This resolves the petition for certiorari under Rule 65 of the Rules of Court, praying that the Ombudsman's
1
disapproval of the Office of the Special Prosecutor's (OSP) Resolution dated September 18, 2000,
recommending dismissal of the criminal cases filed against herein petitioners, be reversed and set aside.
The antecedent facts are as follows.On July 22, 1998, the Fact-Finding and Intelligence Bureau of the Office of
the Ombudsman filed a Complaint-Affidavit docketed as OMB-0-98-1500, charging herein petitioners with Illegal
Use of Public Funds as defined and penalized under Article 220 of the Revised Penal Code and violation of
Section 3, paragraphs (a) and (e) of Republic Act (R.A.) No. 3019, as amended.
The complaint alleged that there were irregularities in the use by then Congressman Carmello F. Lazatin of his
Countrywide Development Fund (CDF) for the calendar year 1996, i.e., he was both proponent and implementer
of the projects funded from his CDF; he signed vouchers and supporting papers pertinent to the disbursement as
Disbursing Officer; and he received, as claimant, eighteen (18) checks amounting to P4,868,277.08. Thus,
petitioner Lazatin, with the help of petitioners Marino A. Morales, Angelito A. Pelayo and Teodoro L. David, was
allegedly able to convert his CDF into cash.A preliminary investigation was conducted and, thereafter, the
2
Evaluation and Preliminary Investigation Bureau (EPIB) issued a Resolution dated May 29, 2000 recommending
the filing against herein petitioners of fourteen (14) counts each of Malversation of Public Funds and violation of
Section 3 (e) of R.A. No. 3019. Said Resolution was approved by the Ombudsman; hence, twenty-eight (28)
Informations docketed as Criminal Case Nos. 26087 to 26114 were filed against herein petitioners before the
Sandiganbayan.Petitioner Lazatin and his co-petitioners then filed their respective Motions for
Reconsideration/Reinvestigation, which motions were granted by the Sandiganbayan (Third Division). The
Sandiganbayan also ordered the prosecution to re-evaluate the cases against petitioners.
3
Subsequently, the OSP submitted to the Ombudsman its Resolution dated September 18, 2000. It
recommended the dismissal of the cases against petitioners for lack or insufficiency of evidence.
The Ombudsman, however, ordered the Office of the Legal Affairs (OLA) to review the OSP Resolution. In a
4
Memorandum dated October 24, 2000, the OLA recommended that the OSP Resolution be disapproved and the
OSP be directed to proceed with the trial of the cases against petitioners. On October 27, 2000, the Ombudsman
adopted the OLA Memorandum, thereby disapproving the OSP Resolution dated September 18, 2000 and
ordering the aggressive prosecution of the subject cases. The cases were then returned to the Sandiganbayan for
continuation of criminal proceedings.
Thus, petitioners filed the instant petition.
Petitioners allege that:
I.THE OMBUDSMAN ACTED WITH GRAVE ABUSE OF DISCRETION OR ACTED WITHOUT OR IN EXCESS OF HIS
JURISDICTION.
II.THE QUESTIONED RESOLUTION WAS BASED ON MISAPPREHENSION OF FACTS, SPECULATIONS, SURMISES AND
5
CONJECTURES. Amplifying their arguments, petitioners asseverate that the Ombudsman had no authority to
overturn the OSP's Resolution dismissing the cases against petitioners because, under Section 13, Article XI of
the 1987 Constitution, the Ombudsman is clothed only with the power to watch, investigate and recommend the
filing of proper cases against erring officials, but it was not granted the power to prosecute. They point out that
under the Constitution, the power to prosecute belongs to the OSP (formerly the Tanodbayan), which was
intended by the framers to be a separate and distinct entity from the Office of the Ombudsman. Petitioners
conclude that, as provided by the Constitution, the OSP being a separate and distinct entity, the Ombudsman
should have no power and authority over the OSP. Thus, petitioners maintain that R.A. No. 6770 (The
Ombudsman Act of 1989), which made the OSP an organic component of the Office of the Ombudsman, should
be struck down for being unconstitutional.
Next, petitioners insist that they should be absolved from any liability because the checks were issued to
petitioner Lazatin allegedly as reimbursement for the advances he made from his personal funds for expenses
incurred to ensure the immediate implementation of projects that are badly needed by the Pinatubo victims.

The Court finds the petition unmeritorious.

Petitioners' attack against the constitutionality of R.A. No. 6770 is stale. It has long been settled that the
provisions of R.A. No. 6770 granting the Office of the Ombudsman prosecutorial powers and placing the OSP
under said office have no constitutional infirmity. The issue of whether said provisions of R.A. No. 6770 violated
6
the Constitution had been fully dissected as far back as 1995 in Acop v. Office of the Ombudsman.
Therein, the Court held that giving prosecutorial powers to the Ombudsman is in accordance with the
Constitution as paragraph 8, Section 13, Article XI provides that the Ombudsman shall "exercise such other
functions or duties as may be provided by law." Elucidating on this matter, the Court stated:
x x x While the intention to withhold prosecutorial powers from the Ombudsman was indeed present, the
Commission [referring to the Constitutional Commission of 1986] did not hesitate to recommend that the
Legislature could, through statute, prescribe such other powers, functions, and duties to the Ombudsman. x x x
As finally approved by the Commission after several amendments, this is now embodied in paragraph 8, Section
13, Article XI (Accountability of Public Officers) of the Constitution, which provides:
Sec.13. The Office of the Ombudsman shall have the following powers, functions, and duties:
x x x xPromulgate its rules and procedure and exercise such other functions or duties as may be provided by law.
Expounding on this power of Congress to prescribe other powers, functions, and duties to the Ombudsman, we
quote Commissioners Colayco and Monsod during interpellation by Commissioner Rodrigo:
x x x xMR. RODRIGO:
Precisely, I am coming to that. The last of the enumerated functions of the Ombudsman is: "to exercise such
powers or perform such functions or duties as may be provided by law." So, the legislature may vest him with
powers taken away from the Tanodbayan, may it not?
MR. COLAYCO:Yes.MR. MONSOD:
Yes.x x x xMR. RODRIGO:
Madam President. Section 5 reads: "The Tanodbayan shall continue to function and exercise its powers as
provided by law."MR. COLAYCO:
That is correct, because it is under P.D. No. 1630.
MR. RODRIGO:So, if it is provided by law, it can be taken away by law, I suppose.MR. COLAYCO:That is correct.
MR. RODRIGO:And precisely, Section 12(6) says that among the functions that can be performed by the
Ombudsman are "such functions or duties as may be provided by law." The sponsors admitted that the
legislature later on might remove some powers from the Tanodbayan and transfer these to the Ombudsman.
MR. COLAYCO:Madam President, that is correct.
x x x xMR. RODRIGO:
Madam President, what I am worried about is, if we create a constitutional body which has neither punitive nor
prosecutory powers but only persuasive powers, we might be raising the hopes of our people too much and then
disappoint them.MR. MONSOD:I agree with the Commissioner.
MR. RODRIGO:Anyway, since we state that the powers of the Ombudsman can later on be implemented by the
legislature, why not leave this to the legislature?x x x xMR. MONSOD: (reacting to statements of Commissioner
Blas Ople):x x x xWith respect to the argument that he is a toothless animal, we would like to say that we are
promoting the concept in its form at the present, but we are also saying that he can exercise such powers and
functions as may be provided by law in accordance with the direction of the thinking of Commissioner Rodrigo.
We do not think that at this time we should prescribe this, but we leave it up to Congress at some future time if
it feels that it may need to designate what powers the Ombudsman need in order that he be more
effective.1awphi1 This is not foreclosed.So, this is a reversible disability, unlike that of a eunuch; it is not an
7
irreversible disability. The constitutionality of Section 3 of R.A. No. 6770, which subsumed the OSP under the
Office of the Ombudsman, was likewise upheld by the Court in Acop. It was explained, thus:
x x x the petitioners conclude that the inclusion of the Office of the Special Prosecutor as among the offices
under the Office of the Ombudsman in Section 3 of R.A. No. 6770 ("An Act Providing for the Functional and
Structural Organization of the Office of the Ombudsman and for Other Purposes") is unconstitutional and void.
The contention is not impressed with merit. x x x

x x x xx x x Section 7 of Article XI expressly provides that the then existing Tanodbayan, to be henceforth known
as the Office of the Special Prosecutor, "shall continue to function and exercise its powers as now or hereafter
may be provided by law, except those conferred on the Office of the Ombudsman created under this
Constitution." The underscored phrase evidently refers to the Tanodbayan's powers under P.D. No. 1630 or
subsequent amendatory legislation. It follows then that Congress may remove any of the Tanodbayan's/Special
Prosecutor's powers under P.D. No. 1630 or grant it other powers, except those powers conferred by the
Constitution on the Office of the Ombudsman.
Pursuing the present line of reasoning, when one considers that by express mandate of paragraph 8, Section 13,
Article XI of the Constitution, the Ombudsman may "exercise such other powers or perform functions or duties
as may be provided by law," it is indubitable then that Congress has the power to place the Office of the Special
Prosecutor under the Office of the Ombudsman. In the same vein, Congress may remove some of the powers
granted to the Tanodbayan by P.D. No. 1630 and transfer them to the Ombudsman; or grant the Office of the
Special Prosecutor such other powers and functions and duties as Congress may deem fit and wise. This Congress
8
did through the passage of R.A. No. 6770. The foregoing ruling of the Court has been reiterated in Camanag v.
9
10
Guerrero. More recently, in Office of the Ombudsman v. Valera, the Court, basing its ratio decidendi on its
ruling in Acop and Camanag, declared that the OSP is "merely a component of the Office of the Ombudsman and
may only act under the supervision and control, and upon authority of the Ombudsman" and ruled that under
R.A. No. 6770, the power to preventively suspend is lodged only with the Ombudsman and Deputy
11
Ombudsman. The Court's ruling in Acop that the authority of the Ombudsman to prosecute based on R.A. No.
6770 was authorized by the Constitution was also made the foundation for the decision in Perez v.
12
Sandiganbayan, where it was held that the power to prosecute carries with it the power to authorize the filing
of informations, which power had not been delegated to the OSP. It is, therefore, beyond cavil that under the
Constitution, Congress was not proscribed from legislating the grant of additional powers to the Ombudsman or
placing the OSP under the Office of the Ombudsman.Petitioners now assert that the Court's ruling on the
constitutionality of the provisions of R.A. No. 6770 should be revisited and the principle of stare decisis set aside.
Again, this contention deserves scant consideration.The doctrine of stare decisis et non quieta movere (to
adhere to precedents and not to unsettle things which are established) is embodied in Article 8 of the Civil Code
of the Philippines which provides, thus:ART. 8. Judicial decisions applying or interpreting the laws or the
Constitution shall form a part of the legal system of the Philippines.It was further explained in Fermin v.
13
People as follows:The doctrine of stare decisis enjoins adherence to judicial precedents. It requires courts in a
country to follow the rule established in a decision of the Supreme Court thereof. That decision becomes a
judicial precedent to be followed in subsequent cases by all courts in the land. The doctrine of stare decisis is
based on the principle that once a question of law has been examined and decided, it should be deemed settled
14
and closed to further argument. 1avvphi1In Chinese Young Men's Christian Association of the Philippine Islands
15
v. Remington Steel Corporation, the Court expounded on the importance of the foregoing doctrine, stating
that:The doctrine of stare decisis is one of policy grounded on the necessity for securing certainty and stability of
judicial decisions, thus:Time and again, the court has held that it is a very desirable and necessary judicial
practice that when a court has laid down a principle of law as applicable to a certain state of facts, it will adhere
to that principle and apply it to all future cases in which the facts are substantially the same. Stare decisis et non
quieta movere. Stand by the decisions and disturb not what is settled. Stare decisis simply means that for the
sake of certainty, a conclusion reached in one case should be applied to those that follow if the facts are
substantially the same, even though the parties may be different. It proceeds from the first principle of justice
that, absent any powerful countervailing considerations, like cases ought to be decided alike. Thus, where the
same questions relating to the same event have been put forward by the parties similarly situated as in a
previous case litigated and decided by a competent court, the rule of stare decisis is a bar to any attempt to
16
relitigate the same issue. The doctrine has assumed such value in our judicial system that the Court has ruled
that "[a]bandonment thereof must be based only on strong and compelling reasons, otherwise, the becoming
virtue of predictability which is expected from this Court would be immeasurably affected and the public's
17
confidence in the stability of the solemn pronouncements diminished." Verily, only upon showing that

circumstances attendant in a particular case override the great benefits derived by our judicial system from the
doctrine of stare decisis, can the courts be justified in setting aside the same.
In this case, petitioners have not shown any strong, compelling reason to convince the Court that the doctrine
ofstare decisis should not be applied to this case. They have not successfully demonstrated how or why it would
be grave abuse of discretion for the Ombudsman, who has been validly conferred by law with the power of
control and supervision over the OSP, to disapprove or overturn any resolution issued by the latter.
The second issue advanced by petitioners is that the Ombudsman's disapproval of the OSP Resolution
recommending dismissal of the cases is based on misapprehension of facts, speculations, surmises and
conjectures. The question is really whether the Ombudsman correctly ruled that there was enough evidence to
support a finding of probable cause. That issue, however, pertains to a mere error of judgment. It must be
stressed that certiorari is a remedy meant to correct only errors of jurisdiction, not errors of judgment. This has
18
been emphasized in First Corporation v. Former Sixth Division of the Court of Appeals, to wit:
It is a fundamental aphorism in law that a review of facts and evidence is not the province of the extraordinary
remedy of certiorari, which is extra ordinem - beyond the ambit of appeal. In certiorari proceedings, judicial
review does not go as far as to examine and assess the evidence of the parties and to weigh the probative
value thereof. It does not include an inquiry as to the correctness of the evaluation of evidence. Any error
committed in the evaluation of evidence is merely an error of judgment that cannot be remedied by
certiorari. An error of judgment is one which the court may commit in the exercise of its jurisdiction. An error of
jurisdiction is one where the act complained of was issued by the court without or in excess of jurisdiction, or
with grave abuse of discretion, which is tantamount to lack or in excess of jurisdiction and which error is
correctible only by the extraordinary writ of certiorari. Certiorari will not be issued to cure errors of the trial
court in its appreciation of the evidence of the parties, or its conclusions anchored on the said findings and its
conclusions of law. It is not for this Court to re-examine conflicting evidence, re-evaluate the credibility of the
19
witnesses or substitute the findings of fact of the court a quo. Evidently, the issue of whether the evidence
indeed supports a finding of probable cause would necessitate an examination and re-evaluation of the evidence
upon which the Ombudsman based its disapproval of the OSP Resolution. Hence, the Petition
for Certiorari should not be given due course.Likewise noteworthy is the holding of the Court in Presidential Ad
20
Hoc Fact-Finding Committee on Behest Loans v. Desierto, imparting the value of the Ombudsman's
independence, stating thus:Under Sections 12 and 13, Article XI of the 1987 Constitution and RA 6770 (The
Ombudsman Act of 1989), the Ombudsman has the power to investigate and prosecute any act or omission of a
public officer or employee when such act or omission appears to be illegal, unjust, improper or inefficient. It has
been the consistent ruling of the Court not to interfere with the Ombudsman's exercise of his investigatory
and prosecutory powers as long as his rulings are supported by substantial evidence. Envisioned as the
champion of the people and preserver of the integrity of public service, he has wide latitude in exercising his
powers and is free from intervention from the three branches of government. This is to ensure that his Office
21
is insulated from any outside pressure and improper influence. Indeed, for the Court to overturn the
Ombudsman's finding of probable cause, it is imperative for petitioners to clearly prove that said public official
22
acted with grave abuse of discretion. In Presidential Commission on Good Government v. Desierto, the Court
elaborated on what constitutes such abuse, to wit:Grave abuse of discretion implies a capricious and whimsical
exercise of judgment tantamount to lack of jurisdiction. The Ombudsman's exercise of power must have been
done in an arbitrary or despotic manner which must be so patent and gross as to amount to an evasion of a
23
positive duty or a virtual refusal to perform the duty enjoined or to act at all in contemplation of law. x x x
In this case, petitioners failed to demonstrate that the Ombudsman acted in a manner described above. Clearly,
the Ombudsman was acting in accordance with R.A. No. 6770 and properly exercised its power of control and
supervision over the OSP when it disapproved the Resolution dated September 18, 2000.
It should also be noted that the petition does not question any order or action of the Sandiganbayan Third
Division; hence, it should not have been included as a respondent in this petition.
IN VIEW OF THE FOREGOING, the petition is DISMISSED for lack of merit. No costs.
SO ORDERED.

A.M.
No.
RTJ-89-425
April
17,
1990OSCAR
PALMA
PAGASIAN, complainant,
vs.JUDGE CESAR P. AZURA, respondent.
In the administrative proceedings at bar, Judge Cesar P. Azura is charged with having knowingly rendered an
unjust judgment against Oscar Palma Pagasian. The latter's sworn complaint draws attention to a decision
rendered on September 21, 1989 by His Honor in a criminal prosecution for theft of large cattle (Crim. Case No.
922-M [87]) entitled "People v. Vicente Dumo Sr. and Vicente Dumo Jr.," in which the complainant, the barangay
captain in the locality, was one of the witnesses for the prosecution. The complaint alleges that although the
complainant, Pagasian, was "not in any manner, shape or form an accused in said . . case," respondent Judge
in his decision acquitting both accused "for utter lack of evidence" nevertheless declared him guilty of "clear
violations of the provisions of the fundamental law of the land and against human rights," and sentenced him to
pay a fine of P200.00.The decision in question recites inter alia the acts supposed to have been done by
Barangay Captain Pagasian after receiving a report from Luciana Degala that she had lost a male carabao, to wit:
he and his "vigilante" had found the bull, dead, early in the morning of July 20, 1986, near the house of the
accused Vicente Dumo Sr. accompanied by a policeman, he had later gone to see Dumo Sr.; and asked him "if the
cart under his house was his," and on receiving an affirmative answer, "he borrowed the cart and issued a
receipt therefor (Exh. "E");" he used the cart to haul the bull away and then deposited the cart at the municipal
building of Talisayan "for safe-keeping." After pronouncing the government evidence insufficient to prove the
defendants' guilt, the decision went on to characterize the taking of the cart as a "confiscation," as "a seizure . .
made without any search or seizure warrant issued by any judge," and its use in evidence as violative of the
Constitution. The decision ended with the following disposition:WHEREFORE, for utter lack of evidence, the
accused Vicente Dumo Sr. and Vicente Dumo Jr., are hereby acquitted.xxx xxx xxxFor clear violation of the
provision of the fundamental law of the land and against human rights so sacred in a democracy, Barangay
Captain Oscar Pagasian is hereby fined in the sum of TWO HUNDRED PESOS (P200.00) payable in a period of
fifteen (15) days from the date of the promulgation of this judgment and failure to pay within the said period, he
shall be imprisoned for a period of two (2) days.
Respondent Judge, in his comment dated January 18, 1990, concedes that Pagasian was not an accused in the
case, but insists that his search of the house of Vicente Dumo, Sr., his seizure of the latter's cart and deposit
thereof in the municipal building, "without being armed with any warrant issued by any judge," was a "violation
of Sec. 2 of Art. III of the Constitution." He asserts that while there was no "law in implementation of any
violation of the provisions of the constitution," he felt it to be "his solemn duty to defend and protect the
constitution," and not to "decline to render judgment by reason of the silence, obscurity or insufficiency of the
laws" (Art. 9, Civil Code), and adopt "any suitable process or mode of proceeding . . which appears most
conformable to the spirit" of the Rules of Court (Sec. 6, Rule 135, Rules of Court). He finally declares that as a
judge, he "cannot be held to account or answer, criminally, civilly, or administratively for an erroneous decision
rendered by him in good faith." (In Re Judge Baltazar R. Dizon, Adm. Case No. 3086, promulgated 31 May 89)."
Respondent Judge appears to have regrettably lost sight of an even more fundamental and familiar
constitutional precept: "No person shall be deprived of life, liberty or property without due process of law" (Sec.
1, Art. III, Constitution). This safeguard, the first listed in the Bill of Rights, includes what is known as procedural
due process that guarantees a procedure which, according to Daniel Webster, "hears before it condemns, which
proceeds upon inquiry and renders judgment only after trial." It is made more particular in a subsequent section:
"No person shall be held to answer for a criminal offense without due process of law" (Sec. 14 [a]). In said
Criminal Case No. 922-M (87), the complaining witness had absolutely no Idea that he himself was on trial, like
the very persons he was accusing, for the commission of some offense (or perhaps for constructive contempt);
he consequently had no opportunity whatsoever to present any evidence in his behalf to exculpate him from the
offense which was known to nobody except the Judge. What is worse, the complainant was punished for acts
not declared by any law to constitute a penal offense and prescribing a specific penalty therefor, in violation of
another equally familiar precept, which also appears to have escaped respondent Judge's attention, that no act
may be deemed to be, and punished as, a crime unless so declared by law. Under the circumstances, the Court
must hold that the complainant was clearly denied due process by respondent Judge. He was subjected to no

small injustice. He was, by a process of specious, sophistical reasoning on the part of the respondent Judge,
sentenced to a penalty without justification whatever, in infringement of basic principles of which all judges are
charged with knowledge.
WHEREFORE, the Court finds respondent Judge guilty of gross ignorance and hereby sentences him to pay a fine
of Two Thousand Pesos (P2,000.00). The Court further directs that a copy of this judgment be entered in the
Judge's record.
SO ORDERED.