CALTEX vs.
PALOMAR
FACTS:
 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
 open indiscriminately to all "motor vehicle owners and/or licensed drivers
 no fee or consideration is required to be paid, no purchase of Caltex products
required to be made
 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 1st, 2nd, and 3rd
o Prizes at this level consist of a 3-burner kerosene stove for first; a thermos
bottle and a Ray-O-Vac hunter lantern for second; and an Everready
Magnet-lite flashlight with batteries and a screwdriver set for third
 Regional Contest in seven different regions. The winning stubs of the qualified
contestants in each region will be deposited in a sealed can
 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
 national level, the stubs of the seven regional first-prize winners will be placed inside
a sealed can from which the drawing for final 1st, 2nd and 3rd winner
o Cash prizes in store for winners at this final stage are: P3,000 for first;
P2,000 for second; P1,500 for third; and P650 as consolation prize for each
of the remaining four participants
 Acting Postmaster General opined that scheme falls within the purview of the
provisions aforesaid and declined to grant the requested clearance (violates the anti-
lottery provision in the 1982 and 1983 Revised Administrative Code)
 Caltex says that there is no consideration involved on the part of the contestants
 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
o 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 files a case in court. Court rendered a decision in favor of Caltex
ISSUES:
1. whether the petition states a sufficient cause of action for declaratory relief
2. whether the proposed "Caltex Hooded Pump Contest" violates the Postal Law
RULING:
1. Declatory Relief
 Section 1 of Rule 66 of the old Rules of Court
o Conditions:
o there must be a justiciable Controversy
o the controversy must be between persons whose interests are adverse
o the party seeking declaratory relief must have a legal interest in the
controversy
o the issue involved must be ripe for judicial determination
 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
2. Violation of the Postal Law
 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
 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
 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
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 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
 The true test, as laid down in People vs. Cardas 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
 a gratuitous distribution of property by chance
 The required element of consideration does not consist of the benefit derived by the
proponent of the contest
 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
 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 proscribed
o Gift enterprise sporting artifice under which goods are sold for their market
value but by way of inducement each purchaser is given a chance to win a prize
o 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
o 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
o 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
o 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 nonmailable.
o 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
o "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
PEOPLE vs MAPA
FACTS:
 Mapa was accused of unlawfully have in his possession and under his custody and
control one home-made revolver (Paltik), Cal. 22, without serial number, with six (6)
rounds of ammunition, without first having secured the necessary license or permit
theref or from the corresponding authorities.
 Mapa admitted that he had the gun without license
ISSUES:
 Whether or not the appointment to and holding of the position of a secret agent to
the provincial governor would constitute a sufficient defense to a prosecution for
the crime of illegal possession of firearm and ammunition
RULING:
 The law is explicit that' except as thereafter specifically allowed, "it shall be unlawful
for any person to * * * possess any firearm, detached parts of firearms or
ammunition therefor, or any instrument or implement used or intended to be used
in the “manufacture of firearms, parts of firearms, or ammunition."5 The next
section provides that "firearms and ammunition regularly and lawfully issued to
officers, soldiers, sailors, or marines [of the Armed Forces of the Philippines], the
Philippine Constabulary, guards in the employment of the Bureau of Prisons,
municipal police, provincial governors, lieutenant governors, provincial treasurers,
municipal treasurers, municipal mayors, and guards of provincial prisoners and jails,"
are not covered "when such firearms are in possession of such officials and public
servants for use in the performance of their official duties
 The law cannot be any clearer. No provision is made for a secret agent. As such he is
not exempt. Our task is equally clear. The first and fundamental duty of courts is to
apply the law. "Construction and interpretation come only after it has been
demonstrated that application is impossible or inadequate without them
DAOANG vs. MUNICIPAL JUDGE
FACTS:
 On 23 March 1971, the respondent spouses Antero and Amanda Agonoy filed a
petition with the Municipal Court of San Nicolas, Ilocos Norte, seeking the adoption
of the minors Quirino Bonilla and
 Wilson Marcos
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  The minors Roderick and Rommel Daoang, assisted by their father and guardian, filed
an opposition to the aforementioned petition for adoption, claiming that the spouses
Antero and Amanda Agonoy had a legitimate daughter named Estrella Agonoy,
oppositors’ mother, who died on 1 March 1971, and therefore, said spouses were
disqualified to adopt under Art. 335 of the Civil Code
o Art. 335. The following cannot adopt:
o Those who have legitimate, legitimated, acknowledged natural children, or
children by legal fiction
 the adoption of Quirino Bonilla and Wilson Marcos would not only introduce a
foreign element into the family unit,but would result in the reduction of their
legitimes. It would also produce an indirect, permanent and irrevocable
disinheritance which is contrary to the policy of the law that a subsequent
reconciliation between the offender and the offended person deprives the latter of
the right to disinherit and renders ineffectual any disinheritance that may have been
made
ISSUES:
Whether or not the spouses Agonoy are disqualified to adopt
RULING:
 Well known is the rule of statutory construction to the effect that a statute clear and
unambiguous on its face need not be interpreted; stated otherwise, the rule is that
only statutes with an ambiguous or doubtful meaning may be the subject of statutory
construction
 The present tendency, however, is geared more towards the promotion of the
welfare of the child and the enhancement of his opportunities for a useful and happy
life, and every intendment is sustained to promote that objective
 Under the law now in force, having legitimate, legitimated, acknowledged natural
children, or children by legal fiction, is no longer a ground for disqualification to
adopt
ALONZO vs IAC
FACTS:
 Five brothers and sisters inherited in equal pro indiviso shares a parcel of land
registered in the name of their deceased parents under OCT No. 10977 of the
Registry of Deeds of Tarlac
 On March 15, 1963, one of them, Celestino Padua, transferred his undivided share
of the herein petitioners for the sum of P550.00 by way of absolute sale.2 One year
later, on April 22, 1964, Eustaquia Padua, his sister, sold her own share to the same
vendees, in an instrument denominated "Con Pacto de Retro Sale," for the sum of
 P440.00
 By virtue of such agreements, the petitioners occupied, after the said sales, an area
corresponding to two-fifths of the said lot, representing the portions sold to them.
The vendees subsequently enclosed the same with a fence. In 1975, with their
consent, their son Eduardo Alonzo and his wife built a semi-concrete house on a part
of the enclosed area
 Mariano Padua, one of the five coheirs, sought to redeem the area sold to the
spouses Alonzo, but his complaint was dismissed when it appeared that he was an
American citizen
 Tecla Padua, another co-heir, filed her own complaint invoking the same right of
redemption claimed by her brother
 The trial court also dismiss this complaint, now on the ground that the right had
lapsed, not having been exercised within thirty days from notice of the sales in 1963
and 1964. Although there was no written notice, it was held that actual knowledge
of the sales by the co-heirs satisfied the requirement of the law.
 It is highly improbable that the other co-heirs were unaware of the sales and that
they thought, as they alleged, that the area occupied by the petitioners had merely
been mortgaged by Celestino and Eustaquia
 Especially significant was the erection thereon of the permanent semi-concrete
structure by the petitioners' son, which was done without objection on her part or
of any of the other co-heirs
 Art. 1088. Should any of the heirs sell his hereditary rights to a stranger before the
partition, any or all of the co-heirs may be subrogated to the rights of the purchaser
by reimbursing him for the price of the sale, provided they do so within the period
of one month from the time they were notified in writing of the sale by the vendor
 In reversing the trial court, the respondent court*** declared that the notice
required by the said article was written notice and that actual notice would not
suffice as a substitute
ISSUE:
Whether or not knowledge can be considered as notice
RULING:
 The petition before us appears to be an illustration of the Holmes dictum that "hard
cases make bad laws" as the petitioners obviously cannot argue against the fact that
there was really no written notice given by the vendors to their co-heirs. Strictly
applied and interpreted, Article 1088 can lead to only one conclusion, to wit, that in
view of such deficiency, the 30day period for redemption had not begun to run,
much less expired in 1977
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 Thus, we interpret and apply the law not independently of but in consonance with
justice. Law and justice are inseparable, and we must keep them so. To be sure, there
are some laws that, while generally valid, may seem arbitrary when applied in a
particular case because of its peculiar circumstances. In such a situation, we are not
bound, because only of our nature and functions, to apply them just the same, in
slavish obedience to their language. What we do instead is find a balance between
the word and the will, that justice may be done even as the law is obeyed
 As judges, we are not automatons. We do not and must not unfeelingly apply the
law as it is worded, yielding like robots to the literal command without regard to its
cause and consequence
 we defer not to "the letter that killeth" but to "the spirit that vivifieth," to give effect
to the lawmaker's will
 The spirit rather than the letter of a statute determines its construction; hence, a
statute must be read according to its spirit or intent. For what is within the spirit is
within the statute although it is not within the letter thereof, and that which is within
the letter but not within the spirit is not within the statute. Stated differently, a thing
which is within the intent of the lawmaker is as much within the statute as if within
the letter; and a thing which is within the letter of the statute is not within the statute
unless within the intent of
 In requiring written notice, Article 1088 seeks to ensure that the redemptioner is
properly notified of the sale and to indicate the date of such notice as the starting
time of the 30-day period of Redemption
 Considering the shortness of the period, it is really necessary, as a general rule, to
pinpoint the precise date it is supposed to begin, to obviate any problem of alleged
delays, sometimes consisting of only a day or two
 In the face of the established facts, we cannot accept the private respondents'
pretense that they were unaware of the sales made by their brother and sister in
1963 and 1964. By requiring written proof of such notice, we would be closing our
eyes to the obvious truth in favor of their palpably false claim of ignorance, thus
exalting the letter of the law over its purpose
 While the general rule is, that to charge a party with laches in the assertion of an
alleged right it is essential that he should have knowledge of the facts upon which
he bases his claim, yet if the circumstances were such as should have induced inquiry,
and the means of ascertaining the truth were readily available upon inquiry, but the
party neglects to make it, he will be chargeable with laches, the same as if he had
known the facts
 It was the perfectly natural thing for the co-heirs to wonder why the spouses Alonzo,
who were not among them, should enclose a portion of the inherited lot and build
thereon a house of strong materials
 Thus when the facts warrants, we interpret the law in a way that will render justice,
presuming that it was the intention of the lawmaker, to begin with, that the law be
dispensed with justice. So we have done in this case
ENDENCIA vs DAVID
FACTS:
 Saturnino David as Collector of Internal Revenue to refund to Justice Pastor M.
Endencia the sum of P1,744.45, representing the income tax collected on his salary
as Associate Justice of the Court of Appeals in 1951, and to Justice Fernando Jugo the
amount of P2,345.46, representihg the income tax collected on his salary from
January 1, 1950 to October 19, 1950, as Presiding Justice of the Court of Appeals,
and from October 20, 1950 to December 31
 Because of the similarity of the two cases, involving as they do the same question of
law, they were jointly submitted for determination in the lower court Judge Higinio
B. Ma cadaeg presiding, in a rather exhaustive and well considered decision found
and held that under the doctrine laid down by this Court in the case of Perfecto vs.
Meer the collection of income taxes from the salaries of Justice Jugo and Justice
Endencia was a diminution of their compensation and therefore was in violation of
the Constitution of the Philippines, and so ordered the refund of said taxes
ISSUE:
 Whether or not Republic Act No. 590, particularly section 13, can justify and legalize
the collection of income tax on the salary of judicial officers
RULING:
Art. VII Sec. 9 of the Consti
SEC. 9 The members of the Supreme Court and all judges of inferior courts shall hold office
during good behavior, until they reach the age of seventy years, or become incapacitated to
discharge the duties of their office. They shall receive such compensation as may he fixed by
law, which shall not be diminished during their continuance in office. Until the Congress shall
provide otherwise, the Chief Justice of the Supreme Court shall receive an annual
compensation of sixteen thousand pesos, and each Associate Justice, fifteen thousand pesos
Judicial officers are exempt from the payment of income tax on their salaries, because the
collection thereof by the Government was a decrease or diminution of their salaries ,during
their continuance in office, a thing which is expressly prohibited by the Constitution the
Solicitor General, because Congress did not favorably receive the decision in the Perfecto case,
Congress promulgated Republic Act No. 590, if not to counteract the ruling in that decision, at
4
least now to authorize and legalize the collection of income tax on the salaries of judicial
officers
Section 13 of Republic Act No. 590
SEC. 13. No salary wherever received by any public officer of the Republic of the Philippines
shall be considered as exempt from the income tax, payment of which is hereby declared not
to be a diminution of his compensation fixed by the Constitution or by law
Separation of powers
 Defining and interpreting the law is a judicial function and the legislative branch may
not limit or restrict the power granted to, the courts by the Constitution
 When it is clear that a statute transgresses the authority vested in the legislature by
the Constitution, it is the duty of the courts to declare the act unconstitutional
because they cannot shrink from it without violating their oaths of office
 This is a clear example of interpretation or ascertainment of the meaning of the
phrase "which shall not be diminished during their continuance in office," found in
section 9, Article VIII of the Constitution, referring to the salaries of judicial officers.
This act of interpreting the Constitution or any part thereof by the Legislature is an
invasion of the well-defined and established province and jurisdiction of the Judiciary
 The rule is recognized elsewhere that the legislature cannot pass any declaratory act
or act declaratory of what the law was before its passage, so as to give it any binding
weight with the courts. A egislative definition of a word as used in a statute is not
conclusive of its meaning as used elsewhere; otherwise, the legislature would be
usurping a judicial function in defining a term
 We have already said that the Legislature under our form of government is assigned
the task and the power to make and enact laws, but not to interpret them
Taxing judicial officers
 The reason behind the exemption in the Constitution, as interpreted by the United
States Federal Supreme Court and this Court, is to preserve the independence of the
Judiciary, not only of this High Tribunal but of the other
 The primary purpose of the prohibition against diminution was not to benefit the
judges, but, like the clause in respect of tenure, to attract good and competent men
to the bench and to promote that independence of action and judgment which is
essential to the maintenance of the guaranties, limitations and pervading principles
of the Constitution and to the administration of justice without respect to persons
and with equal concern for the poor and the rich. Such being its purpose, it is to be
construed, not as a private grant, but as a limitation imposed in the public interest;
in other words, not restrictively, but in accord with its spirit and the principle on
which it proceeds
 Having in mind the limited number of judicial officers in the Philippines enjoying this
exemption, especially when the great bulk thereof are justices of the peace, many of
them receiving as low as P200 a month, and considering further the other
exemptions allowed by the income tax law, such as P3,000 for a married person and
P600 for each dependent, the amount of national revenue to be derived from
income tax on the salaries of judicial officers, were if not for the constitutional
exemption, could not be large or substantial. But even if it were otherwise, it should
not affect, much less outweigh the purpose and the considerations that prompted
the establishment of the constitutional exemption. In the same case of Evans vs.
Gore, supra, the Federal Supreme Court declared "that they (fathers of the
Constitution) regarded the independence of the judges as of far greater importance
than any revenue that could come from taxing their salaries
 When we come to the members of the Supreme Court, this exemption to them is
relatively of short duration. Because of the limited membership in this High Tribunal,
eleven, and due to the high standards of experience, practice and training required,
one generally enters its portals and comes to join its membership quite late in life,
on the average, around his sixtieth year, and being required to retire at seventy,
assuming that he does not die or become incapacitated earlier, naturally he is not in
a position to receive the benefit of exemption for long
 Considering exemption in the abstract, there is nothing unusual or abhorrent in it, as
long as it is based on public policy or public interest. While all other citizens are
subject to arrest when charged with the commission of a crime, members of the
Senate and House of Representatives except in cases of treason, felony and breach
of the peace are exempt from arrest, during their attendance in the session of the
legislature
 And as to tax exemption, there are not a few citizens who enjoy this exemption.
Persons, natural and juridical, are exempt from taxes on their lands, buildings and
improvements thereon when used exclusively for educational purposes, even if they
derive income therefrom
 In conclusion we reiterate the doctrine laid down in the case of Perfecto vs. Meer,
supra, to the effect that the col- lection of income tax on the salary of a judicial officer
is a diminution thereof and so violates the Constitution. We further hold that the
interpretation and application of the Constitution and of statutes is within the
exclusive province and jurisdiction of the Judicial department, and that in enacting a
law, the Legislature may not legally provide therein that it be interpreted in such a
way that it may not violate a Constitutional prohibition, thereby tying the hands of
the courts in their task of later interpreting said statute specially when the
interpretation sought and provided in said statute runs counter to a previous
interpretation already given in a case by the highest court of the land
NITAFAN vs CIR
FACTS:
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 the duly appointed and qualified Judges presiding over Branches 52, 19 and 53,
respectively, of the Regional Trial Court, National Capital Judicial Region, all with
stations in Manila, seek to prohibit and/or perpetually enjoin respondents, the
Commissioner of Internal Revenue and the Financial Officer of the Supreme Court,
from making any deduction of withholding taxes from their salaries
 any tax withheld from their emoluments or compensation as judicial officers
constitutes a decrease or diminution of their salaries, contrary to the provision of
Section 10, Article VIII of the 1987 Constitution mandating that (d)uring their
continuance in office, their salary shall not be decreased,' even as it is anathema to
the ideal of an independent judiciary envisioned in and by said Constitution
ISSUE:
 Whether judicial officers are exempt from paying taxes
RULING:
 The debates, interpellations and opinions expressed regarding the constitutional
provision in question until it was finally approved by the Commission disclosed that
the true intent of the framers of the 1987 Constitution, in adopting it, was to make
the salaries of members of the Judiciary taxable
 The ascertainment of that intent is but in keeping with the fundamental principle of
constitutional construction that the intent of the framers of the organic law and of
the people adopting it should be given effect
 The primary task in constitutional construction is to ascertain and thereafter assure
the realization of the purpose of the framers and of the people in the adoption of
the Constitution
 the Constitution authorizes Congress to pass a law fixing another rate of
compensation of Justices and Judges but such rate must be higher than that which
they are receiving at the time of enactment, or if lower, it would be applicable only
to those appointed after its approval
 FR. BERNAS:
o During their continuance in office, their salary shall not be diminished BUT
MAY BE SUBJECT TO GENERAL INCOME TAX.' In support of this position, I
would say that the argument seems to be that the justice and judges
should not be subjected to income tax because they already gave up the
income from their practice. That is true also of Cabinet members and all
other employees. And I know right now, for instance, there are many
people who have accepted employment in the government involving a
reduction of income and yet are still subject to income tax. So, they are not
the only citizens whose income is reduced by accepting service in
government
PEOPLE vs. CONCEPCION
FACTS:
 Venancio Concepcion, President of the Philippine National Bank, between April 10,
1919, and May 7, 1919, authorized an extension of credit in favor of "Puno y
Concepcion, S. en C." in the amount of P300,00
 On the facts recounted, Venancio Concepcion, as President of the Philippine National
Bank and as member of the board of directors of this bank, was charged in the Court
of First Instance of Cagayan with a violation of section 35 of Act No. 2747. He was
found guilty by the Honorable Enrique V. Filamor, Judge of First Instance, and was
sentenced to imprisonment for one year and six months, to pay a fine of P3,000, with
subsidiary imprisonment in case of insolvency, and the costs.
 Section 35 of Act No. 2747, effective on February 20, 1918, just mentioned, to which
reference must hereafter repeatedly be made, reads as follows: "The National Bank
shall not, directly or indirectly, grant loans to any of the members of the board of
directors of the bank nor to agents of the branch banks
 These two sections were in effect in 1919 when the alleged unlawful acts took place,
but were repealed by Act No. 2938, approved on January 30, 1921
ISSUES:
1. Was the granting of a credit of P300,000 to the copartnership "Puno y Concepcion,
S. en C." by Venancio Con-cepcion, President of the Philippine National Bank, a "loan"
within the meaning of section 35 of Act No. 2747
2. Was the granting of a credit of P300,000 to the copartnership "Puno y Concepcion,
S. en C.," by Venancio Concepcion, President of the Philippine National Bank, a "loan"
or a "discount
3. Was the granting of a credit of P300,000 to the copartnership, "Puno y Concepcion,
S. en C." by Venancio Concepcion, President of the Philippine National Bank, an
"indirect loan" within the meaning of section 35 of Act No. 2747
4. Could Venancio Concepcion, President of the Philippine National Bank, be convicted
'of a violation of section 35 of Act No. 2747 in relation with section 49 of the same
Act, when these portions of Act No. 2747 were repealed by Act No. 2938, prior to
the filing of the information and the rendition of the judgment
5. Was the granting of a credit of P300,000 to the copartnership "Puno y Concepcion,
S. en C." by Venancio Concepcion, President of the Philippine National Bank, in
violation of section 35 of Act No. 2747, penalized by this law
6. Does the alleged good faith of Venancio Concepcion,President of the Philippine
National Bank, in extending the credit of P300,000 to the copartnership "Puno y
Concepcion, S. en C." constitute a legal defense
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RULING:
1. The "credit" of an individual means his ability to borrow money by virtue of the
confidence or trust reposed by a lender that he will pay what he may promise
A "loan" means the delivery by one party and the receipt by the other party of a
given sum of money, upon an agreement, express or implied, to repay the sum
loaned, with or without interest
The concession of a "credit" necessarily involves the granting of "loans" up to the
limit of the amount fixed in the "credit
2. Counsel argue that while section 35 of Act No. 2747 prohibits the granting of a "loan,"
it does not prohibit what is commonly known as a "discount
H. Parker Willis, then President of the National Bank, inquired of the Insular Auditor
whether section 37 of Act No. 2612 was intended to apply to discounts as well as to
loans. The ruling of the Acting Insular Auditor, dated August 11, 1916, was to the
effect that said section referred to loans alone, and placed no restriction upon
discount transactions
Discount vs. Loan
In a discount, interest is deducted in advance, while in a loan, interest is taken at the
expiration of a credit
a discount is always on double-name paper; a loan is generally on single-name paper
demand notes signed by the firm "Puno y Concepcion, S. en C." were not discount
paper but were mere evidences of indebtedness, because (1) interest was not
deducted from the face of the notes, but was paid when the notes fell due; and (2)
they were single-name and not double-name paper
3. In the interpretation and construction of statutes, the primary rule is to ascertain
and give effect to the intention of the Legislature. In this instance, the purpose of the
Legislature is plainly to erect a wall of safety against temptation for a director of the
bank. The prohibition against indirect loans is a recognition of the familiar maxim
that no man may serve two masters—that where personal interest clashes with
fidelity to duty the latter almost always suffers
A loan, therefore, to a partnership of which the wife of a director of a ban is a
member, is an indirect loan to such director
That it was the intention of the Legislature to prohibit exactly such an occurrence is
shown by the acknowledged fact that in this instance the defendant was tempted to
mingle his personal and family affairs with his official duties, and to permit the loan
of P300,000 to a partnership of no established reputation and without asking for
collateral security
4. In other words, it has been the holding, and it must again be the holding, that where
an Act of the Legislature which penalizes an offense repeals a former Act which
penalized the same offense, such repeal does not have the effect of thereafter
depriving the courts of jurisdiction to try, convict, and sentence offenders charged
with violations of the old law
5. The answer is that when the corporation itself is forbidden to do an act, the
prohibition extends to the board of directors, and to each director separately and
individually
6. Under the statute which the defendant has violated, criminal intent is not necessarily
material. The doing of the inhibited act, inhibited on account of public policy and
public interest, constitutes the crime. And, in this instance, as previously
demonstrated, the acts of the President of the Philippine National Bank do not f all
within the purview of the rulings of the Insular Auditor, even conceding that such
rulings have controlling effect
TAÑADA vs YULO
FACTS:
 Juan Tañada, the petitioner, was appointed justice of the peace of Alabat, Tayabas,
by the Governor-General with the advice and consent of the Philippine Commission
on December 4,1911
 He continued in that position until September 8, 1934, when at his own request,
"Pursuant to the provisions of section 206 of the Revised Administrative Code", he
was "transferred from the position of justice of the peace for the municipality of
Alabat, Province of Tayabas, to the same position in the municipality of Perez, same
province", by a communication signed by the Governor-General from which the
foregoing is quoted
Tañada completed the age of sixty-five years on October 5, 1934. Thereupon the Judge of First
Instance of Tayabas, acting in accordance with instructions from the Department of Justice,
directed Tañada to cease to act as justice of the peace of Perez, Tayabas
Tañada protested
The applicable law is found in the last proviso to section 203 of the Administrative Code, as
inserted by Act No. 3899, and in the proviso to section 206 of the same Code as last amended
by Act No. 2768, which read as follows
7
 SEC. 203. Appointment and distribution of justices of the peace.—* * * Provided,
further, That the present justices and auxiliary justices of the peace who shall, at the
time this Act takes effect, have completed sixty-five years of age, shall cease to hold
office on January first, nineteen hundred and thirty-three; and the Governor-
General, with the advice and consent of the Philippine Senate, shall make new
appointments to cover the vacancies
occurring by operation of this Act."
"SEC. 206. Tenure of office—Transfer from one municipality to another. —A justice
of the peace having the requisite legal qualifications shall hold office during good
behavior unless his office be lawfully abolished or merged in the jurisdiction of some
other justice: Provided, that in case the public interest requires it, a justice of the
peace of one municipality may be
transferred to another
ISSUE:
Whether or not Tañada is compelled to retire
RULING:
 Act No. 3899, leaves room for no other deduction than that a justice of the peace
appointed prior to the approval of the Act and who completed sixty-five years of age
on September 13, 1934, subsequent to the approval of the Act, which was on
November 16, 1931, and to the date fixed for cessation from office which was on
January 1, 1933, is not affected by the said Act
 Having done so, all of us are agreed that a justice of the peace like the petitioner who
became sixty-five years of age on October 5, 1934, was not included in a law which
required justices of the peace sixty-five years of age to cease to hold office on
January 1, 1933
 it is equally fundamental that that legislative intent must be determined from the
language of the statute itself
 By liberal construction of statutes, courts from the language used, the subject
matter, and the purposes of those framing them are able to find out their true
meaning. There is a sharp distinction, however, between construction of this nature
and the act of a court in engrafting upon a law something that has been omitted
which someone believes ought to have been embraced. The former is liberal
construction and is a legitimate exercise of judicial power.
 The latter is judicial legislation forbidden by the tripartite division of powers among
the three departments of government, the executive, the legislative, and the judicial
Tañada’s transfer
 the peace by the Governor-General must be consented to by the Philippine Senate.
In consonance with this provision, the method of appointment and distribution of
justices of the peace are outlined in section 203 of the Administrative Code, a portion
of which is hereinbefore quoted. The transfer from one municipality to another,
however, is accomplished by the Governor-General without the advice and consent
of the Philippine Senate, in accordance with codal section 206
 The holding of the higher court, to follow the language of the syllabus, was that in
view of the plenary legislative powers of the Philippine Legislature regarding justices
of the peace, Act No. 2768 of the Philippine Legislature is valid as applied to justices
of the peace whose appointment was made by the Governor-General, and confirmed
by the Senate, after its enactment
FLORESCA vs. PHILEX
FACTS:
 Petitioners are the heirs of the deceased employees of Philex Mining Corporation
(hereinafter referred to as Philex), who, while working at its copper mines
underground operations at Tuba, Benguet on June 28, 1967, died as a result of the
cave-in that buried them in the tunnels of the mine. Specifically, the complaint
alleges that Philex, in violation of government rules and regulations, negligently and
deliberately failed to take the required precautions for the protection of the lives of
its men working underground
 petitioners based on an industrial accident are covered by the provisions of the
Workmen’s Compensation Act (Act 3428, as amended by RA 772) and that the
former Court of First Instance has no jurisdiction over the case. Petitioners filed an
opposition dated May 27, 1968 to the said motion to dismiss claiming that the causes
of action are not based on the provisions of the Workmen’s Compensation Act but
on the provisions of the Civil Code allowing the award of actual, moral and exemplary
damages
 Art. 2176. Whoever by act or omission causes damage to another, there being fault
or negligence, is obliged to pay for the damage done. Such fault or negligence, if
there is no pre-existing contractual relation between the parties, is called a quasi-
delict and is governed by the provisions of this Chapter.
o “Art. 2178. The provisions of articles 1172 to 1174 are also applicable to a
quasi-delict.
o “(b) Art. 1173—The fault or negligence of the obligor consists in the
omission of
 that diligence which is required by the nature of the obligation and corresponds with
 the circumstances of the persons, of the time and of the place. When negligence
shows bad faith, the provisions of Articles 1171 and 2201, paragraph 2 shall apply
o Art. 2201. x x x x x x x x x
8
 o “In case of fraud, bad faith, malice or wanton attitude, the obligor shall be
responsible for all damages which may be reasonably attributed to the non-
performance of the obligation.
o “Art. 2231. In quasi-delicts, exemplary damages may be granted if the defendant
acted with gross negligence
 On December 16, 1968, respondent Judge dismissed the case for lack of jurisdiction
and ruled that in accordance with the established jurisprudence, the Workmen’s
Compensation Commission has exclusive original jurisdiction over damage or
compensation claims for work-connected deaths or injuries of workmen or
employees, irrespective of whether or not the employer was negligent, adding that
if the employer’s negligence results in work-connected deaths or injuries, the
employer shall, pursuant to Section 4-A of the Workmen’s Compensation Act, pay
additional compensation equal to 50% of the compensation fixed in the Act
 In fact, it points out that Philex voluntarily paid the compensation due the petitioners
and all the payments have been accepted in behalf of the deceased miners, except
the heirs of Nazarito Floresca who insisted that they are entitled to a greater amount
of damages under the Civil Code
ISSUES:
 whether they have a right of selection or choice of action between availing of the
worker’s right under the Workmen’s Compensation Act and suing in the regular
courts under the Civil Code for higher damages (actual, moral and/or exemplary)
from the employer by virtue of negligence (or fault) of the employer or of his other
employees or whether they may avail cumulatively of both actions, i.e., collect the
limited compensation under the Workmen’s Compensation Act and sue in addition
for damages in the regular courts
RULING:
 Atty. Bacungan and adds that once the heirs elect the remedy provided for under
the Act, they are no longer entitled to avail themselves of the remedy provided for
under the Civil Code by filing an action for higher damages in the regular court, and
vice versa
 It should be underscored that petitioners’ complaint is not for compensation based
on the Workmen’s Compensation Act but a complaint for damages (actual,
exemplary and moral) in the total amount of eight hundred twenty-five thousand
(P825,000.00) pesos
 In the present case, there exists between Philex and the deceasedemployees a
contractual relationship. The alleged gross and reckless negligence and deliberate
failure that amount to bad faith on the part of Philex, constitute a breach of contract
for which it may be held liable for damages
 The rationale in awarding compensation under the Workmen’s Compensation Act
differs from that in giving damages under the Civil Code. The compensation acts are
based on a theory of
 compensation distinct from the existing theories of damages, payments under the
acts being made as compensation and not as damages
 In other words, under the compensation acts, the employer is liable to pay
compensation benefits for loss of income, as long as the death, sickness or injury is
work-connected or work-aggravated, even if the death or injury is not due to the
fault of the employer
 On the other hand, damages are awarded to one as a vindication of the wrongful
invasion of his rights. It is the indemnity recoverable by a person who has sustained
injury either in his person, property or relative rights, through the act or default of
another
 Had petitioners been aware of said violation of government rules and regulations by
Philex, and of its negligence, they would not have sought redress under the
Workmen’s Compensation Commission which awarded a lesser amount for
compensation. The choice of the first remedy was based on ignorance or a mistake
of fact, which nullifies the choice as it was not an intelligent choice
 Article 10 of the New Civil Code states: “In case of doubt in the interpretation or
application of laws, it is presumed that the lawmaking body intended right and
justice to prevail
 It is patent, therefore, that recovery under the New Civil Code for damages arising
from negligence, is not barred by Article 173 of the New Labor Code
 It is therefore patent that giving effect to the social justice guarantees of the
Constitution, as implemented by the provisions of the New Civil Code, is not an
exercise of the power of law-making, but is rendering obedience to the mandates of
the fundamental law and the implementing legislation aforementioned
 “Idolatrous reverence” for the letter of the law sacrifices the human being. The spirit
of the law insures man’s survival and ennobles him. In the words of Shakespeare,
“the letter of the law killeth; its spirit giveth life
9
EUGENIO vs. DRILON
FACTS:
 Did the failure to develop a subdivision constitute legal justification for the
nonpayment of amortizations by a buyer on installment under land purchase
agreements entered into prior to the enactment of P.D. 957, "The Subdivision and
Condominium Buyers' Protective Decree"?
 On May 10, 1972, private respondent purchased on installment basis from petitioner
and his coowner/developer Fermin Salazar, two lots in the E & S Delta Village in
Quezon City
 Acting on complaints for nondevelopment docketed as NHA Cases Nos. 2619 and
2620 filed by the Delta Village Homeowners' Association, Inc., the National Housing
Authority (NHA) rendered a resolution on January 17 1979 inter alia ordering
petitioner to cease and desist from making further sales of lots in said village or in
any project owned by him
 While cases were still pending, private respondent filed with the Office of Appeals,
Adjudication and Legal Affairs (OAALA) of the Human Settlements Regulatory
Commission (HSRC), a complaint (Case No. 80589) against petitioner and spouses
Rodolfo and Adelina Relevo alleging that, in view of the above NHA resolution, he
suspended payment of his amortizations, but that petitioner resold one of the two
lots to the said spouses Relevo, in whose favor title to the said property was
registered
 alleged that he suspended his payments because of petitioner's failure to develop
the village. Private respondent prayed for the annulment of the sale to the Relevo
spouses and for reconveyance of the lot to him
 OAALA rendered a decision upholding the right of petitioner to cancel the contract
with private respondent and dismissed private respondent's complaint
 the Commission Proper of the HSRC reversed the OAALA and, applying P.D. 957,
ordered petitioner to complete the subdivision development and to reinstate private
respondent's purchase contract over one lot
 E&S village refunded to the Relevo spouses
 Under Revised Administrative Circular No. 195,
 "appeals from judgments or final orders of the . . . Office of the President . . . may be
taken to the Court of Appeals
 in order to hasten the resolution of this case, the Court resolved to make an
exception to the said Circular in the interest of speedy justice
 Petitioner avers that inasmuch as the land purchase agreements were entered into
in 1972, prior to the effectivity of P.D. 957 in 1976, said law cannot govern the
transaction
ISSUE/S:
 Did the Executive Secretary abuse his discretion?
RULING:
 that respondent Executive Secretary did not abuse his discretion, and that P.D. 957
is to be given retroactive effect so as to cover even those contracts executed prior
to its enactment in 1976
 The intention of the legislature in enacting a law is the law itself, and must be
enforced when ascertained, although it may not be consistent with the strict letter of
the statute. Courts will not follow the letter of a statute when it leads away from the
true intent and purpose of the legislature and to conclusions inconsistent with the
general purpose of the act
 P.D. 957 was enacted with no other end in view than to provide a protective mantle
over helpless citizens who may fall prey to the manipulations and machinations of
'unscrupulous subdivision and condominium sellers', (found in its preamble)
 WHEREAS, numerous reports reveal that many real estates, subdivision owners,
developers, operators, and/or sellers have reneged on their representations and
obligations to provide and maintain properly subdivision roads, drainage, sewerage,
water systems, lighting systems, and other similar basic requirements, thus
endangering the health and safety of home and lot buyers;
 "WHEREAS, reports of alarming magnitude also show cases of swindling and
fraudulent manipulations perpetrated by unscrupulous subdivision and
condominium sellers and operators, such as failure to deliver titles to the buyers or
titles free from liens and encumbrances, and to pay real estate taxes, and fraudulent
sales of the same subdivision lots to different innocent purchasers for value;
 strictly prospective application of the statute will effectively emasculate it
 the State will not be able to exercise its regulatory functions and curb fraudulent
schemes and practices with contracts that happened before 1976
 Sections 20, 21 and 23 thereof, which by their very terms have retroactive effect and
will impact upon even those contracts and transactions entered into prior to P.D. 957
o Sec. 20 - Every owner or developer shall construct and provide the facilities,
improvements,
10
 o infrastructures and other forms of development within 1 year from the issuance
of the license for the subdivision or other times authorized by law (Time of
completion)
o Sec. 21 - In cases of subdivision lots or condominium units sold or disposed of
prior to the effectivity of this Decree, it shall be incumbent upon the owner or
developer of must comply with his obligations as provided in the preceding
section within two years from the date of this Decree unless otherwise
extended by the Authority or unless an adequate performance bond is filed in
accordance with Section 6
o Sec. 23 - No installment payment made by a buyer in a subdivision or
condominium project for the lot or unit he contracted to buy shall be forfeited
in favor of the owner or developer when the buyer, after due notice to the
owner or developer, desists from further payment due to the failure of the
owner or developer to develop the subdivision or condominium project
according to the approved plans and within the time limit for complying with
the same. Such buyer may, at his option, be reimbursed the total amount paid
including amortization interests but excluding delinquency interests, with
interest thereon at the legal rate
 The party of the First Part hereby binds himself to subdivide, develop and improve
the entire area covered by Transfer Certificate of Title No. 168119 of which the
parcels of lands subject of this contract is a part in accordance with the provisions of
Quezon City Ordinance No. 6561 as may be presently in force or may hereafter be
required by laws passed by the Congress of the Philippines or required by regulations
of the Bureau of Lands, the General Registration Office and other government
agencies
 Petitioner invoked Sec. 23 of P.D 957 for failure of payments private respondent
started to default on amortization payments beginning May 1975, so that by the end
of July 1975 he had already incurred three consecutive arrearages in payments,
nevertheless, the petitioner, who had the cancellation option available to him under
the contract, did not exercise or utilize the same in timely fashion but delayed until
May 1979 when he finally made up his mind to cancel the contracts. But by that time
the land purchase agreements had already been overtaken by the provisions of P.D.
957, promulgated on July 12, 1976
 there is no merit in petitioner's contention that respondent Secretary exceeded his
jurisdiction in ordering the refund of private respondent's payments on Lot 12
although (according to petitioner) only Lot 13 was the subject of the complaint
 Finally, since petitioner's motion for reconsideration of the (Executive Secretary's)
Decision dated March 10, 1992 was filed only on the 21st day from receipt thereof,
said decision had become final and executory, pursuant to Section 7 of
Administrative Order No. 18 dated February 12, 1987, which provides that
"(d)ecisions/ resolutions/ orders of the Office of the President shall, except as
otherwise provided for by special laws, become final after the lapse of fifteen (15)
days from receipt of a copy thereof . . . , unless a motion for reconsideration thereof
is filed within such period
ANTONIO vs. MIRANDA
FACTS:
 The parties in this case were rival candidates for the Punong Barangay of Barangay
Ilaya, Las Piñas City, Metro Manila. After the board of canvassers proclaimed
protestee-appellant Rustico Antonio, protestant-appellee Vicente T Miranda, Jr. 􀀼led
an election protest docketed as Election Protest Case No. 97- 0017 against Antonio
before the Metropolitan Trial Court of Las Piñas City
 Commission decision:
o In the light of the aforequoted rules, protestee RUSTICO ANTONIO, failed
to perfect his appeal within the 􀀼ve (5) days period prescribed for
perfecting his appeal, as he 􀀼led his Notice of Appeal only on March 27,
1998 or nine (9) days after receipt of the decision sought to be appealed
ISSUE/S:
 Is the period to appeal a decision of a municipal trial court to the Commission on
Elections ("COMELEC") in an election protest involving a barangay position 5 days
per COMELEC Rules of Procedure or 10 days as provided for in Republic Act 6679 and
the Omnibus Election Code?
RULING:
 According to Antonio, quasijudicial bodies, including this Commission, cannot amend
an act of Congress and in case of discrepancy between the basic law and an
interpretative or administrative ruling, the former prevails. Generally, yes. But the
situation herein does not fall within the generic situation contemplated therein
 the perfection of an appeal in the manner and within the period laid down by the
COMELEC Rules of Procedure is not only mandatory but also jurisdictional. As a
consequence, the failure to perfect an appeal within the prescribed period as
required by the Rules has the effect of defeating the right of appeal of a party and
precluding the appellate court from acquiring jurisdiction over the case
 Our Rules of Procedure may be amended, revised or repealed pursuant to the 1987
Constitution (Article VIII Section 5[5]) providing that rules of procedure of . . . quasi-
judicial bodies shall remain effective unless disapproved by the Supreme Court. But
far from being disapproved the COMELEC Rules of Procedure received approbation
and has constantly been cited by the Supreme Court in a number of decisions
 It is beyond cavil that legislative enactments prevail over rules of procedure
promulgated by administrative or quasi-judicial bodies and that rules of procedure
should be consistent with standing legislative enactments
11
 in Flores vs. Commission on Elections 6 , this Court had declared that decisions of the
Metropolitan or Municipal Court in election protest cases involving barangay o􀀼cials
are no longer appealable to the Regional Trial Court but to the COMELEC pursuant
to Section 2(2) of Article IX-C of the 1987 Constitution
 Petitioner submits that the dispositive portion in the Flores case only declared
unconstitutional that portion of Section 9 of Republic Act 6679 providing for appeal
to the Regional Trial Court but not the ten (10) day period of appeal
 According to petitioner, only the portion providing for the appellate jurisdiction of
the Regional Trial Court in said cases should be deemed unconstitutional
 that the period to appeal can be severed from the remedy or the appeal itself which
is provided in Section 9, Republic Act 6679 and survive on its own. The presumption
cannot be sustained because the period to appeal is an essential characteristic and
wholly dependent on the remedy
 The general rule is that where part of a statute is void as repugnant to the
Constitution, while another part is valid, the valid portion, if separable from the
invalid, may stand and be enforced. The presence of a separability clause in a statute
creates the presumption that the legislature intended separability, rather than
complete nullity, of the statute. To justify this result, the valid portion must be so far
independent of the invalid portion that it is fair to presume that the legislature would
have enacted it by itself if it had supposed that it could not constitutionally enact the
other
 The exception to the general rule is that when the parts of a statute are so mutually
dependent and connected, as conditions, considerations, inducements, or
compensations for each other, as to warrant a belief that the legislatureintended
them as a whole the nullity of one part will vitiate the rest.
 In other words, with the elimination of the forum, the period cannot stand on its
own. Moreover, when this Court stated that "Section 9 of Rep. Act No. 6679 is
declared unconstitutional insofar as it provides that barangay election contests
decided by the municipal or metropolitan trial court shall be appealable to the
regional trial court", it meant to preserve the 􀀼rst two sentences on the original
jurisdiction of municipal and metropolitan trial courts to try barangay election
protests cases
 we cannot indulge in the assumption that Congress still intended, by the said laws,
to maintain the ten (10) day period to appeal despite the declaration of
 unconstitutionality of the appellate jurisdiction of the regional trial court, Republic
Act No. 7166 13 amending the Omnibus Election Code, evinces the intent of our
lawmakers to expedite the remedial aspect of election controversies
 SECTION 22. Election Contests for Municipal O􀀼cers . — All election contests
involving municipal o􀀼ces 􀀼led with the Regional Trial Court shall be decided
expeditiously. The decision may be appealed to the Commission within (5) days from
promulgation or receipt of a copy thereof by the aggrieved party. The Commission
shall decide the appeal within sixty (60) days after it is submitted for decision, but
not later than six (6) months after the 􀀼ling of the
 appeal, which decision shall be final, unappealable and executory
 since the whole remedy was invalidated, a void was created. Thus, the COMELEC had
to come in and provide for a new appeal in accordance with the mandate of the
Constitution
 The 1993 COMELEC Rules of Procedure have provided a uniform 􀀼ve (5) day period
for taking an appeal consistent with the expeditious resolution of election-related
cases
 Hence, Section 3, Rule 22 of the COMELEC Rules of Procedure is not in con􀀼ict with
any existing law. To adopt a contrary view would defeat the laudable objective of
providing a uniform period of appeal and defy the COMELEC's constitutional
mandate to enact rules of procedure to expedite disposition of election cases
 The Court en banc has held in Rodillas vs. COMELEC 17 that "the procedure for
perfecting an appeal from the decision of the Municipal Trial Court in a barangay
election protest case is set forth in the COMELEC Rules of Procedure
 Su􀀼ce it to state that the period for 􀀼ling an appeal is by no means a mere technicality
of law or procedure. It is an essential requirement without which the decision
appealed from would become 􀀼nal and executory as if no appeal was 􀀼led at all. The
right of appeal is merely a statutory privilege and may be exercised only in the
manner prescribed by, and in accordance with, the provisions of the law
 the economic policy of deregulation but vitiated its aspects which offended the
constitutional mandate on fair competition
We hold that the power and obligation of this Court to pass upon the constitutionality of laws
cannot be defeated by the fact that the challenged law carries serious economic implications.
This Court has struck down laws abridging the political and civil rights of our people even if it
has to offend the other more powerful branches of the government. There is no reason why
the Court cannot strike down R.A. No. 8180 that violates the economic rights of our people
even if it has to bridle the liberty of big business within reasonable bounds
ISSUE/S:
whether the Court should only declare as unconstitutional the
provisions of R.A. No. 8180 on 4% tariff differential, minimum inventory and predatory pricing
RULING:
12
TAÑADA vs. TUVERA
FACTS:
 Invoking the people's right to be informed on matters of public concern, a right
recognized in Section 6, Article IV of the 1973 Philippine Constitution, 1 as well as
the principle that laws to be valid and enforceable must be published in the Of􀀼cial
Gazette or otherwise effectively promulgated, petitioners seek a writ of mandamus
to compel respondent public of􀀼cials to publish, and or cause the publication in the
Of􀀼cial Gazette of various presidential decrees, letters of instructions, general
orders, proclamations, executive orders, letter of implementation and
administrative orders
 The view is submitted that in the absence of any showing that petitioners are
personally and directly affected or prejudiced by the alleged non-publication of the
presidential issuances in question 2 said petitioners are without the requisite legal
personality to institute this mandamus proceeding, they are not being "aggrieved
parties" within the meaning of Section 3, Rule 65 of the Rules of Court,
 Upon the other hand, petitioners maintain that since the subject of the petition
concerns a public right and its object is to compel the performance of a public duty,
they need not show any specific interest for their petition to be given due course
 when the question is one of public right and the object of the mandamus is to
procure the enforcement of a public duty, the people are regarded as the real party
in interest and the relator at whose instigation the proceedings are instituted need
not show that he has any legal or special interest in the result, it being suf􀀼cient to
show that he is a citizen and as such interested in the execution of the laws
 Respondents further contend that publication in the Of􀀼cial Gazette is not a sine qua
non requirement for the effectivity of laws where the laws themselves provide for
their own effectivity dates. It is thus submitted that since the presidential issuances
in question contain special provisions as to the date they are to take effect,
publication in the Of􀀼cial Gazette is not indispensable for their effectivity
 this Court has ruled that publication in the Of􀀼cial Gazette is necessary in those cases
where the legislation itself does not provide for its effectivity date — for then the
date of publication is material for determining its date of effectivity, which is the
􀀼fteenth day following its publication — but not when the law itself provides for the
date when it goes into effect
 Considered in the light of other statutes applicable to the issue at hand, the
conclusion is easily reached that said Article 2 does not preclude the requirement of
publication in the Of􀀼cial Gazette, even if the law itself provides for the date of its
effectivity
 Section 1 of Commonwealth Act 638
o Section 1. There shall be published in the Official Gazette all important
legislative acts and resolutions of a public nature of the Congress of the
Philippines; all executive and administrative orders and proclamations,
except such as have no general applicability; decisions or abstracts of
decisions of the Supreme Court and the Court of Appeals as may be
deemed by said courts of sufficient importance to be so published; such
documents or classes of documents as may be required so to be published
by law; and such documents or classes of documents as the President of
the Philippines shall determine from time to time to have general
applicability and legal effect, or which he may authorize so to be published
ISSUE/S:
RULING:
 The word "shall" used therein imposes upon respondent officials an imperative duty.
That duty must be enforced if the Constitutional right of the people to be informed
on matters of public concern is to be given substance and reality
 The word "shall" used therein imposes upon respondent of􀀼cials an imperative duty.
That duty must be enforced if the Constitutional right of the people to be informed
on matters of public concern is to be given substance and reality
 The publication of all presidential issuances "of a public nature" or "of general
applicability" is mandated by law. Obviously, presidential decrees that provide for
􀀼nes, forfeitures or penalties for their violation or otherwise impose a burden on the
people, such as tax and revenue measures fall within this category. Other
presidential issuances which apply only to particular persons or class of persons such
as administrative and executive orders need not be published on the assumption
that they have been circularized to all concerned
 The Court therefore declares that presidential issuances of general application,
which have not been published, shall have no force and effect
 Similarly, the implementation/enforcement of presidential decrees prior to their
publication in the Of􀀼cial Gazette is "an operative fact which may have consequences
which cannot be justly ignored. The past cannot always be erased by a new judicial
declaration . . . that an all-inclusive statement of a principle of absolute retroactive
invalidity cannot be justified
 From the report submitted to the Court by the Clerk of Court, it appears that of the
presidential decrees sought by petitioners to be published in the Of􀀼cial Gazette,
only Presidential Decrees Nos. 1019 to 1030, inclusive, 1278, and 1937 to 1939,
inclusive, have not been so published
TAÑADA part 2
13

 The government argued that while publication was necessary as a rule, it was not so
when it was "otherwise provided," as when the decrees themselves declared that
they were to become effective immediately upon their approval
 Resolving their own doubts, the petitioners suggest that there should be no
distinction between laws of general applicability and those which are not; that
publication means complete publication; and that the publication must be made
forthwith in the Official Gazette
 Rule 3, Section 18, of the Rules of Court. Responding, he submitted that issuances
intended only for the interval administration of a government agency or for
particular persons did not have to be published; that publication when necessary
must be in full and in the Official Gazette; and that, however, the decision under
reconsideration was not binding because it was not supported by eight members of
this Court
 The subject of contention is Article 2 of the Civil Code providing as follows:
 ART. 2. Laws shall take effect after fifteen days following the completion of their
publication in the Official Gazette, unless it is otherwise provided. This Code shall
take effect one year after such publication
 "unless it is otherwise provided" refers to the date of effectivity and not to the
requirement of publication itself, which cannot in any event be omitted. This clause
does not mean that the legislature may make the law effective immediately upon
approval or on any other date, without its previous publication
 Publication is indispensable in every case, but the legislature may in its discretion
provide that the usual fifteen-day period shall be shortened or extended
 The term "laws" should refer to all laws and not only to those of general application,
for strictly speaking all laws relate to the people in general albeit there are some that
do not apply to them directly. An example is a law granting citizenship to a particular
individual, like a relative of President Marcos who was decreed instant naturalization
 The subject of such law is a matter of public interest which any member of the body
politic may question in the political forums or, if he is a proper party, even in the
courts of justice
 We hold therefore that all statutes, including those of local application and private
laws, shall be published as a condition for their effectivity, which shall begin fifteen
days after publication unless a different effectivity date is fixed by the legislature
 Interpretative regulations and those merely internal in nature, that is, regulating only
the personnel of the administrative agency and not the public, need not be
published. Neither is publication required of the so-called letters of instructions
issued by administrative superiors concerning the rules or guidelines to be followed
by their subordinates in the performance of their duties
 Accordingly, even the charter of a city must be published notwithstanding that it
applies to only a portion of the national territory and directly affects only the
inhabitants of that place. All presidential decrees must be published, including even,
say, those naming a public place after a favored individual or exempting him from
certain prohibitions or requirements. The circulars issued by the Monetary Board
must be published if they are meant not merely to interpret but to "􀀼ll in the details"
of the Central Bank Act which that body is supposed to enforce
 no publication is required of the instructions issued by, say, the Minister of Social
Welfare on the case studies to be made in petitions for adoption or the rules laid
down by the head of a government agency on the assignments or workload of his
personnel or the wearing of of􀀼ce uniforms. Parenthetically, municipal ordinances
are not covered by this rule but by the Local Government Code
 We agree that the publication must be in full or it is no publication at all since its
purpose is to inform the public of the contents of the laws. As correctly pointed out
by the petitioners, the mere mention of the number of the presidential decree, the
title of such decree, its whereabouts (e.g., "with Secretary Tuvera"), the supposed
date of effectivity, and in a mere
 supplement of the Of􀀼cial Gazette cannot satisfy the publication requirement. This
is not even substantial compliance
 Consequently, we have no choice but to pronounce that under Article 2 of the Civil
Code, the publication of laws must be made in the Of􀀼cial Gazette, and not
elsewhere, as a requirement for their effectivity after 􀀼fteen days from such
publication or after a different period provided by the legislature
14
GLOBE-MACKAY vs NLRC
(VERBA LEGIS)
FACTS:
In May 1982, private respondent was employed by Globe-Mackay Cable and Radi Corporation
(GMCR) as general systems analyst. Also employed by petitioner as manager for technical
operations' support was Delfin Saldivar with whom private respondent was allegedly very close
Sometime in 1984, petitioner GMCR, prompted by reports that company equipment and spare
parts worth thousands of dollars under the custody of Saldivar were missing, caused the
investigation of the latter's activities
The report indicated that Saldivar had entered into a partnership styled Concave Commercial
and Industrial Company with Richard A. Yambao, owner and manager of Elecon Engineering
Services (Elecon), a supplier of petitioner often recommended by Saldivar.
The report also disclosed that Saldivar had taken petitioner's missing Fedders airconditioning
unit for his own personal use without authorization and also connived with Yambao to defraud
petitioner of its property. The airconditioner was recovered only after petitioner GMCR 􀀼led
an action for replevin against Saldivar
Report also indicated that Imelda Salazar violated company regulations by involving herself in
transactions con􀀼icting with the company's interests. Evidence showed that she signed as a
witness to the articles of partnership between Yambao and Saldivar. It also appeared that she
had full knowledge of the loss and whereabouts of the Fedders airc onditioner but failed to
inform her employer
petitioner company placed private respondent Salazar under preventive suspension for one
(1) month, effective October 9, 1984, thus giving her thirty (30) days within which to explain
her side. But instead of submitting an explanation, three (3) days later or on October 12, 1984,
private respondent filed a complaint against petitioner for illegal suspension, which she
subsequently amended to include illegal dismissal, vacation and sick leave benefits, 13th
month pay and damages
the Labor Arbiter in a decision, ordered petitioner company to reinstate private respondent to
her former or equivalent position and to pay her full backwages and other benefits she would
have received were it not for the illegal dismissal
public respondent National Labor Relations Commission in the questioned resolution dated
December 29, 1987 af􀀼rmed the aforesaid decision with respect to the reinstatement of
private respondent but limited the backwages to a period of two (2) years and deleted the
award for moral damages
ISSUE/S & RULING:
Whether or not Labor Tribunal for having committed grave abuse of discretion in holding
that the suspension and subsequent dismissal of private respondent were illegal and in
ordering her reinstatement with two (2) years' backwages - NO
The investigative findings of Mr. Maramara necessitated immediate and decisive action on any
employee closely associated with Saldivar.
The suspension of Salazar was further impelled by the discovery of the missing Fedders
airconditioning unit inside the apartment private respondent shared with Saldivar. Under such
circumstances, preventive suspension was the proper remedial recourse available to the
company pending Salazar's investigation.
Preventive suspension does not signify that the company has adjudged the employee guilty of
the charges she was asked to answer and explain. Such disciplinary measure is resorted to for
the protection of the company's property pending investigation of any alleged malfeasance or
misfeasance committed by the employee
it is not correct to conclude that petitioner GMCR had violated Salazar's right to due process
when she was promptly suspended. If at all, the fault lay with private respondent when she
ignored petitioner's memorandum of October 8, 1984 "giving her ample opportunity to
present (her) side to the Management." Instead, she went directly to the Labor Department
and filed her complaint
while we agree with the propriety of Salazar's preventive suspension, we hold that her
eventual separation from employment was not for cause
Art. 279 of the Labor Code, as amended, provides:
"Security of Tenure. — In cases of regular employment, the employer shall not
terminate the services of an employee except for a just cause or when authorized
by this Title. An employee who is unjustly dismissed from work shall be entitled to
reinstatement without loss of seniority rights and other privileges and to his full
backwages, inclusive of allowances, and to his other bene􀀼ts or their monetary
equivalent computed from the time his compensation was withheld from him up
to the time of his actual reinstatement
Implementing Rules and Regulations
of the Labor Code:
"Sec. 2. Security of Tenure. — In cases of regular employment, the employer shall
not terminate the services of an employee except for a just cause as provided in
the Labor Code or when authorized by existing laws.
Sec. 3. Reinstatement. — An employee who is unjustly dismissed from work shall
be entitled to reinstatement without loss of seniority rights and to backwages
Social justice provision in the Consti
To be sure, both Charters recognize "security of tenure" as one of the rights of labor which
the State is mandated to protect. But there is no gainsaying the fact that the intent of the
framers of the present Constitution was to give primacy to the rights of labor and afford
the sector "full protection," at least greater protection than heretofore accorded them,
regardless of the geographical location of the workers and whether they are organized or
15
not
To go back to the instant case, there being no evidence to show an authorized, much less a
legal, cause for the dismissal of private respondent, she had every right, not only to be entitled
to reinstatement, but as well, to full backwages
The intendment of the law in prescribing the twin remedies of reinstatement and payment of
backwages is, in the former, to restore the dismissed employee to her status before she lost
her job, for the dictionary meaning of the word "reinstate" is "to restore to a state, condition,
position, etc. from which one had been removed" and in the latter, to give her back the income
lost during the period of unemployment. Both remedies, looking to the past, would perforce
make her "whole
the following reasons have been advanced by the Court for denying reinstatement under the
facts of the case and the law applicable thereto; that reinstatement can no longer be effected
in view of the long passage of time (22 years of litigation) or because of the realities of the
situation; or that it would be "inimical to the employer's interest;" or that reinstatement may
no longer be feasible; or, that it will not serve the best interests of the parties involved; or
that the company would be prejudiced by the workers' continued employment; or that it will
not serve any prudent purpose as when supervening facts have transpired which make
execution on that score unjust or inequitable or, to an increasing extent, due to the resultant
atmosphere of "antipathy and antagonism" or "strained relations" or "irretrievable
estrangement" between the employer and the employee
the wording of the Labor Code is clear and unambiguous: "An employee who is 'unjustly
dismissed from work shall be entitled to reinstatement . . . and to his full backwages . . . "
Under the principles of statutory construction, if a statute is clear, plain and free from
ambiguity, it must be given its literal meaning and applied without attempted interpretation.
This plain-meaning rule or verba legis derived from the maxim index animi sermo est (speech
is the index of intention) rests on the valid presumption that the words employed by the
legislature in a statute correctly express its intent or will and preclude the court from
construing it differently
Verba legis non est recedendum, or from the words of a statute there should be no departure.
Neither does the provision admit of any qualification. If in the wisdom of the Court, there may
be a ground or grounds for nonapplication of the above-cited provision, this should be by way
of exception, such as when the reinstatement may be inadmissible due to ensuing strained
relations between the employer and the employee
it should be proved that the employee concerned occupies a position where
he enjoys the trust and con􀀼dence of his employer; and that it is likely that if reinstated, an
atmosphere of antipathy and antagonism may be generated as to adversely affect the
efficiency and productivity of the employee concerned
it has not been proved that the position of private respondent as systems analyst is
one that may be characterized as a position of trust and con􀀼dence such that if reinstated,
it may well lead to strained relations between employer and employee. Hence, this does
not constitute an exception to the general rule mandating reinstatement for an employee
who has been unlawfully dismissed
has she betrayed any confidence reposed in her by engaging in transactions that may have
created conflict of interest situations? Petitioner GMCR points out that as a matter of company
policy, it prohibits its employees from involving themselves with any company that has
business dealings with GMCR. Consequently, when private respondent Salazar signed as a
witness to the partnership papers of Concave (a supplier of Ultra which in turn is also a supplier
of GMCR), she was deemed to have placed herself in an untenable position as far as petitioner
was concerned
However, on close scrutiny, we agree with public respondent that such a circumstance did
not create a conflict of interest situation. As a system analyst, Salazar was very far removed
from operations involving the procurement of supplies. Salazar's duties revolved around the
development of systems and analysis of designs on a continuing basis. In other words, Salazar
did not occupy a position of trust relative to the approval and purchase of supplies and
company assets
petitioner has predicated its dismissal of Salazar on loss of confidence. As we have held
countless times, while loss of confidence or breach of trust is a valid ground for termination, it
must rest on some basis which must be convincingly established. An employee may not be
dismissed on mere presumptions and suppositions
It is also worth emphasizing that the Maramara report came out after Saldivar had already
resigned from GMCR on May 31, 1984. Since Saldivar did not have the opportunity to refute
management's findings, the report remained obviously one-sided
SAGUISAG vs. OCHOA
(VERBA LEGIS)
FACTS:
 The petitions1 before this Court question the constitutionality of the Enhanced
Defense Cooperation Agreement (EDCA) between the Republic of the Philippines
and the United States of America (U.S.)
Executive Power
 the President of the Philippines, as the sole repository of executive power, is the
guardian of the Philippine archipelago, including all the islands and waters embraced
therein and all other territories over which it has sovereignty or jurisdiction
 To carry out this important duty, the President is equipped with authority over the
Armed Forces of the Philippines (AFP),
 In specific provisions, the President’s power is also limited, or at least shared, as in
Section 2 of Article II on theconduct of war; Sections 20 and 21 of Article VII on
foreign loans, treaties, and international agreements; Sections 4(2) and 5(2)(a) of
16
 Article VIII on the judicial review of executive acts; Sections 4 and 25 of Article XVIII
on treaties and international agreements entered into prior to the Constitution and
on the presence of foreign military troops, bases, or facilities
Relationship between executive power and the senate
 Clearly, the power to defend the State and to act as its representative in the
international sphere inheres in the person of the President. This power, however,
does not crystallize into absolute discretion to craft whatever instrument the Chief
Executive so desires
 Previously, treaties under the 1973 Constitution required ratification by a majority
of the Batasang Pambansa,19 except in instances wherein the President “may enter
into international treaties or agreements as the national welfare and interest may
require.
 This was a departure from the 1935 Constitution, which explicitly gave the President
the power to enter into treaties only with the concurrence of two-thirds of all the
Members of the Senate.21 The 1987 Constitution returned the Senate’s power
US Military in the PH
 The presence of the U.S. military forces in the country can be traced to their pivotal
victory in the 1898 Battle of Manila Bay during the Spanish-American War
 The U.S. Congress later enacted the Hare-Hawes-Cutting Act of 1933, which required
that the proposed constitution of an independent Philippines recognize the right of
the U.S. to maintain the latter’s armed forces and military bases
 The U.S. Legislature subsequently crafted another law called the Tydings-McDuffie
Act or the Philippine Independence Act of 1934.
 Compared to the old Hare-Hawes-Cutting Act, the new law provided for the
surrender to the Commonwealth Government of “all military and other
reservations” of the U.S. government in the Philippines, except “naval reservations
and refueling stations
 Under the Tydings- McDuffie Act, the U.S. President would proclaim the American
withdrawal and surrender of sovereignty over the islands 10 years after the
inauguration of the new government in the Philippines.36 This law eventually led to
the promulgation of the 1935 Philippine Constitution
After PH Independence
Treaty of General Relations — the 1947 MBA
 The Senate concurred on the premise of “mutuality of security interest,” which
provided for the presence and operation of 23 U.S. military bases in the Philippines
for 99 years or until the year 2046.
 the parties entered into the Ramos-Rusk Agreement of 1966, which reduced the
term of the treaty from 99 years to a total of 44 years or until 1991.
 The Bohlen-Serrano Memorandum of Agreement provided for the return to the
Philippines of 17 U.S. military bases covering a total area of 117,075 hectares
 Through the Romulo-Murphy Exchange of Notes of 1979, the parties agreed to the
recognition of Philippine sovereignty over Clark and Subic Bases and the reduction
of the areas that could be used by the U.S
 the parties revised the 1947 MBA through the Romualdez-Armacost Agreement.51
The revision pertained to the operational use of the military bases by the U.S.
government within the context of Philippine sovereignty,52 including the need for
prior consultation with the Philippine government on the former’s use of the bases
for military combat operations or the establishment of long-range missiles
 the Philippines and the U.S. next entered into the MDT in 1951. Concurred in by both
the Philippine60 and the U.S.61 Senates, the treaty has two main features: first, it
allowed for mutual assistance in maintaining and developing their individual and
collective capacities to resist an armed attack;62 and second, it provided for their
mutual self-defense in the event of an armed attack against the territory of either
party
Current status of US bases in the PH
 Termed as the Treaty of Friendship, Cooperation and Security, the countries sought
to recast
 their military ties by providing a new framework for their defense cooperation and
the use of Philippine installations.66 One of the proposed provisions included an
arrangement in which U.S. forces would be granted the use of certain installations
within the Philippine naval base in Subic (rejected by the Senate)
 The consequent expiration of the 194 7 MBA and the resulting paucity of any formal
agreement dealing with the treatment of U.S. personnel in the Philippines led to the
suspension in 1995 of largescale joint military exercises
 The military arrangements between them were revived in 1999 when they
concluded the first Visiting Forces Agreement (VFA).72 As a “reaffirm[ation] [of the]
obligations under the MDT,”73 the VFA has laid down the regulatory mechanism for
the treatment of U.S. military and civilian personnel visiting the country.74
 It contains provisions on the entry and departure of U.S. personnel; the purpose,
extent, and limitations of their activities; criminal and disciplinary jurisdiction; the
waiver of certain claims; the importation and exportation of equipment, materials,
supplies, and other pieces of property owned by the U.S. government; and the
movement of U.S. military vehicles, vessels, and aircraft into and within the country
17
  In the same year, the Philippines and the U.S. entered into the Mutual Logistics
Support Agreement to “further the interoperability, readiness, and effectiveness of
their respective military forces.
 The new agreement outlined the basic terms, conditions, and procedures for
facilitating the reciprocal provision of logistics support, supplies, and services
between the military forces of the two countries
EDCA
 EDCA authorizes the U.S. military forces to have access to and conduct activities
within certain “Agreed Locations” in the country
 President Benigno S. Aquino III ratified EDCA on 6 June 2014
 Two petitions for certiorari were thereafter filed before us assailing the
constitutionality of EDCA. They primarily argue that it should have been in the form
of a treaty concurred in by the Senate, not an executive agreement
ISSUES:
 Whether the President may enter into an executive agreement on foreign military
bases, troops, or facilities
 Whether the provisions under EDCA are consistent with the Constitution, as well as
with existing laws and treaties
RULING:
 It is evident that the constitutional restriction refers solely to the initial entry of the
foreign military bases, troops, or facilities. Once entry is authorized, the subsequent
acts are thereafter subject only to the limitations provided by the rest of the
Constitution and Philippine law, and not to the Section 25 requirement of validity
through a treaty
 The VFA has already allowed the entry of troops in the Philippines
The President may generally enter into executive agreements subject to limitations defined
by the Constitution and may be in furtherance of a treaty already concurred in by the Senate
Executive agreements
 International agreements embodying adjustments of detail carrying out well-
established national policies and traditions and those involving arrangements of a
more or less temporary nature
 One of the distinguishing features of executive agreements is that their validity and
effectivity are not affected by a lack of Senate concurrence
 The right of the Executive to enter into binding agreements without the necessity of
subsequent Congressional approval has been confirmed by long usage
 Joaquin Bernas quoted
o the Court’s ruling in Eastern Sea Trading, the Constitutional Commission
members ultimately decided that the term “international agreements” as
contemplated in Section 21, Article VII, does not include executive
agreements, and that a proviso is no longer needed
 Two very important features that distinguish treaties from executive agreements
o executive agreements must remain traceable to an express or implied
authorization under the Constitution, statutes, or treaties.
o The absence of these precedents puts the validity and effectivity of
executive agreements under serious question for the main function of the
Executive is to enforce the Constitution and the laws enacted by the
Legislature, not to defeat or interfere in the performance of these rules
o treaties are, by their very nature, considered superior to executive
agreements. Treaties are products of the acts of the Executive and the
Senate215 unlike executive agreements, which are solely executive
actions.216 Because of legislative participation through the Senate, a
treaty is regarded as being on the same level as a statute.217 If there is a
irreconcilable conflict, a later law or treaty takes precedence over one that
is prior
The President had the choice to enter into EDCA by way of an executive agreement or a
treaty
No court can tell the President to desist from choosing an executive agreement over a treaty
to embody an international agreement, unless the case falls squarely within Article VIII, Section
25
1. Treaties, international agreements, and executive agreements are all constitutional
manifestations of the conduct of foreign affairs with their distinct legal characteristics.
a. Treaties are formal contracts between the Philippines and other States-parties,
which are in the nature of international agreements, and also of municipal laws in
the sense of their binding nature.226
b. International agreements are similar instruments, the provisions of which may
require the ratification of a designated number of parties thereto. These agreements
involving political issues or changes in national policy, as well as those involving
international agreements of a permanent character, usually take the form of
treaties. They may also include commercial agreements, which are executive
agreements essentially, but which proceed from previous authorization by Congress,
thus dispensing with the requirement of concurrence by the Senate.227
18
 c. Executive agreements are generally intended to implement a treaty already
enforced or to determine the details of the implementation thereof that do not
affect the sovereignty of the State.228
2. Treaties and international agreements that cannot be mere executive agreements must, by
constitutional decree, be concurred in by at least two-thirds of the Senate.
3. However, an agreement - the subject of which is the entry of foreign military troops, bases,
or facilities - is particularly restricted. The requirements are that it be in the form of a treaty
concurred in by the Senate; that when Congress so requires, it be ratified by a majority of the
votes cast by the people in a national referendum held for that purpose; and that it be
recognized as a treaty by the other contracting State.
4. Thus, executive agreements can continue to exist as a species of international agreements
 the Constitutional Commission, they were aware that legally binding international
agreements were being entered into by countries in forms other than a treaty
 Executive agreements may cover the matter of foreign military forces if it merely
involves detail adjustments impliedly affirmed the use of an executive agreement in
an attempt to adjust the details of a provision of the VFA was eventually ruled that
the Romulo-Kenney Agreement was "not in accord" with the VFA, since the former
was squarely inconsistent with a provision in the treaty requiring that the detention
be "by Philippine authorities." Consequently, the Court ordered the Secretary of
Foreign Affairs to comply with the VFA and "forthwith negotiate with the United
States representatives for the appropriate agreement on detention facilities under
Philippine authorities as provided in Art. V, Sec. 10 of the VFA
1. Section 25, Article XVIII of the Constitution, contains stringent requirements that must be
fulfilled by the international agreement allowing the presence of foreign military bases, troops,
or facilities in the Philippines: (a) the agreement must be in the form of a treaty, and (b) it must
be duly concurred in by the Senate.
2. If the agreement is not covered by the above situation, then the President may choose the
form of the agreement (i.e., either an executive agreement or a treaty), provided that the
agreement dealing with foreign military bases, troops, or facilities is not the principal
agreement that first allows their entry or presence in the Philippines.
3. The executive agreement must not go beyond the parameters, limitations, and standards
set by the law and/or treaty that the former purports to implement; and must not unduly
expand the international obligation expressly mentioned or necessarily implied in the law or
treaty.
4. The executive agreement must be consistent with the Constitution, as well as with existing
laws and treaties.
EDCA is consistent with the content, purpose, and framework of the MDT and the VFA
Differences
 The first difference emphasized is that EDCA does not only regulate visits as the VFA
does, but allows temporary stationing on a rotational basis of U.S. military personnel
and their contractors in physical locations with permanent facilities and pre-
positioned military materiel
 This argument does not take into account that these permanent facilities, while built
by U.S. forces, are to be owned by the Philippines once constructed.243 Even the VFA
allowed construction for the benefit of U.S. forces during their temporary visits.
 the second difference stated by the dissent is that EDCA allows the prepositioning of
military materiel, which can include various types of warships, fighter planes,
bombers, and vessels, as well as land and amphibious vehicles and their
corresponding ammunition
 However, the VFA clearly allows the same kind of equipment, vehicles, vessels, and
aircraft to be brought into the country
 Moreover, both the VFA and EDCA are silent on what these activities actually are.
Both the VFA and EDCA deal with the presence of U.S. forces within the Philippines,
but make no mention of being platforms for activity beyond Philippine territory.
 we cannot invalidate EDCA on the basis of the potentially abusive use of its provisions
 The fourth difference is that EDCA supposedly introduces a new concept not
contemplated in the VFA or the MDT: Agreed Locations, Contractors, Pre-
positioning, and Operational Control
 it must already be clarified that the terms and details used by an implementing
agreement need not be found in the mother treaty. They must be sourced from the
authority derived from the treaty, but are not necessarily expressed word-for-word
in the mother treaty
 The fifth difference highlighted by the Dissenting Opinion is that the VFA does not
have provisions that may be construed as a restriction on or modification of
obligations found in existing statues, including the jurisdiction of courts, local
autonomy, and taxation. Implied in this argument is that EDCA contains such
restrictions or modifications
 Both the VFA and EDCA ensure Philippine jurisdiction in all instances contemplated
by both agreements, with the exception of those outlined by the VFA in Articles III-
VI. In the VFA, taxes are clearly waived whereas in EDCA, taxes are assumed by the
government as will be discussed later on. This fact does not, therefore, produce a
diminution of jurisdiction on the part of the Philippines, but rather a recognition of
19
 sovereignty and the rights that attend it, some of which may be waived as in the
cases under Articles III-VI of the VFA
Authorized presence" under the VFA versus "authorized activities" under EDCA: (1) U.S.
personnel and (2) U.S. contractors
 By virtue of Articles I and III of the VFA, the Philippines already allows U.S. military
and civilian personnel to be "temporarily in the Philippines," so long as their presence
is "in connection with activities approved by the Philippine Government."
 Petitioners also challenge the argument that EDCA simply implements the VFA. They
assert that the agreement covers only short-term or temporary visits of U.S. troops
"from time to time" for the specific purpose of combined military exercises with their
Filipino counterparts. They stress that, in contrast, U.S. troops are allowed under
EDCA to perform activities beyond combined military exercises, such as those
enumerated in Articles 111(1) and IV(4) thereof. Furthermore, there is some degree
of permanence in the presence of U.S. troops in the country, since the effectivity of
EDCA is continuous until terminated
 As used in this Agreement, "United States personnel" means United States military
and civilian personnel temporarily in the Philippines in connection with activities
approved by the Philippine Government. Within this definition:
1. The term "military personnel" refers to military members of the United States
Army, Navy, Marine Corps, Air Force, and Coast Guard.
2. The term "civilian personnel" refers to individuals who are neither nationals of
nor ordinarily resident in the Philippines and who are employed by the United
States armed forces or who are accompanying the United States armed forces, such
as employees of the American Red Cross and the United Services Organization
 The Court has already settled in Lim v. Executive Secretary that the phrase "activities
approved by the Philippine Government" under Article I of the VFA was intended to
be ambiguous in order to afford the parties flexibility to adjust the details of the
purpose of the visit of U.S. personnel
 What can be gleaned from the provisions of the VFA, the joint report of the Senate
committees on foreign relations and on national defense and security, and the
ruling of this Court in Lim is that the "activities" referred to in the treaty are meant
to be specified and identified infurther agreements. EDCA is one such agreement.
 We note that these planned activities are very similar to those under the Terms of
Reference285 mentioned in Lim. Both EDCA and the Terms of Reference authorize the
U.S. to perform the following: (a) participate in training exercises; (b) retain
command over their forces; (c) establish temporary structures in the country; (d)
share in the use of their respective resources, equipment and other assets; and (e)
exercise their right to self-defense. We quote the relevant portion of the Terms and
Conditions as follows
 Justice Brion's dissent argues that the presence of U.S. forces under EDCA is "more
permanent" in nature.289However, this argument has not taken root by virtue of a
simple glance at its provisions on the effectivity period. EDCA does not grant
permanent bases, but rather temporary rotational access to facilities for efficiency.
 EDCA is far from being permanent in nature compared to the practice of states as
shown in other defense cooperation agreements
 if after a geopolitical prognosis of situations affecting the country, a belief is
engendered that a much longer period of military training is needed, the President
must be given ample discretion to adopt necessary measures including the flexibility
to set an extended timetable
 Nevertheless, we emphasize that U.S. contractors are explicitly excluded from the
coverage of the VFA. As visiting aliens, their entry, presence, and activities are
subject to all laws and treaties applicable within the Philippine territory
 Therefore, this "unimpeded access" to the Agreed Locations is a necessary adjunct
to the ownership, use, and control of the U.S. over its own equipment, supplies, and
materiel and must have first been allowed by the joint mechanisms in play between
the two states since the time of the MDT and the VFA. It is not the use of the Agreed
Locations that is exclusive
 The similar activities cited by petitioners321 simply show that under the MBA, the U.S.
had the right to construct, operate, maintain, utilize, occupy, garrison, and control
the bases. The so-called parallel provisions of EDCA allow only operational control
over the Agreed Locations specifically for construction activities
PEOPLE vs. PURISIMA
(RATIO LEGIS)
FACTS:
Information were filed charging the respective accused with "illegal possession of deadly
weapon" in violation of Presidential Decree No. 9. The three Judges issued an Order quashing
or dismissing the information, on a common ground, viz, that the Information did not allege
facts which constitute the offense penalized by Presidential Decree No. 9 because it failed to
state one essential element of the crime
"That on or about the 14th day of December, 1974, in the City of Manila, Philippines, the said
accused did then and there wilfully, unlawfully, feloniously and knowingly have in his
possession and under his custody and control one (1) carving knife with a blade of 6-1/2 inches
and a wooden handle of 5-1/4 inches, or an overall length of 11-3/4 inches, which the said
20
accused carried outside of his residence, the said weapon not being used as a tool or
implement necessary to earn his livelihood nor being used in connection therewith
In dismissing or quashing the Informations the trial courts concurred with the submittal of the
defense that one essential element of the offense charged is missing from the Information, viz:
that the carrying outside of the accused's residence of a bladed, pointed or blunt weapon is in
furtherance or on the occasion of, connected with or related to subversion, insurrection, or
rebellion, organized lawlessness or public disorder
In most if not all of the cases, the orders of dismissal were given before arraignment of the
accused. In the criminal case before the Court of (First Instance of Samar the accused was
arraigned but at the same time moved to quash the Information. In all the cases where the
accused were under arrest, the three Judges ordered their immediate release unless held on
other charges
P.D No. 9:
"3. It is unlawful to carry outside of residence any bladed, pointed or blunt weapon such as
'fan knife,' 'spear,' 'dagger,' 'bolo,' 'balisong,' 'barong,' 'kris,' or club, except where such articles
are being used as necessary tools or implements to earn a livelihood and while being used in
connection therewith; and any person found guilty thereof shall suffer the penalty of
imprisonment ranging from five to ten years as a Military Court/Tribunal/Commission may
direct
Arguments of the people:
Malum prohibitum – no need to show subversive activities
ISSUE/S & RULING:
Whether or not the accused should be charged under P.D No. 9 –
the carrying of so-called "deadly weapons" is the subject of another penal statute and a Manila
city ordinance. Thus, Section 26 of Act No. 1780 provides: cdrep
"SECTION 26. It should be unlawful for any person to carry concealed about his person any
bowie knife, dirk, dagger, kris, or other deadly weapon: . . . Any person violating the provisions
of this section shall, upon conviction in a court of competent jurisdiction, be punished by a fine
not exceeding five hundred pesos, or by imprisonment for a period not exceeding six months,
or both such 􀀼ne and imprisonment, in the discretion of the court
P. D. 9(3) does not contain any repealing clause or provision, and repeal by implication is not
favored. This principle holds true with greater force with regards to penal statutes which as a
rule are to be construed strictly against the state and liberally in favor of the accused. In fact,
Article 7 of the New Civil Code provides that laws are repealed only by subsequent ones and
their violation or non-observance shall not be excused by disuse, or custom or practice to the
contrary
We hold that the offense carries two elements: first, the carrying outside one's residence of
any bladed, blunt, or pointed weapon, etc. not used as a necessary tool or implement for a
livelihood; and second, that the act of carrying the weapon was either in furtherance of, or
to abet, or in connection with subversion, rebellion, insurrection, lawless violence, criminality,
chaos, or public disorder
a simple act of carrying any of the weapons described in the presidential decree is not a
criminal offense in itself. What makes the act criminal or punishable under the decree is the
motivation behind it. Without that motivation, the act falls within the purview of the city
ordinance or some statute when the circumstances so warrant
When ambiguity exists, it becomes a judicial task to construe and interpret the true meaning
and scope of the measure, guided by the basic principle that penal statutes are to be construed
and applied liberally in favor of the accused and strictly against the state
events which led to or precipitated the enactment of P.D. 9. These events are clearly spelled
out in the "Whereas" clauses of the presidential decree, thus: (1) the state of martial law in the
country pursuant to Proclamation 1081 dated September 21, 1972; (2) the desired result of
Proclamation 1081 as well as General Orders Nos. 6 and 7 which are particularly mentioned in
P.D. 9; and (3) the alleged fact that subversion, rebellion, insurrection, lawless violence,
criminality, chaos, and public disorder mentioned in Proclamation 1081 are committed and
abetted by the use of firearms and explosives and other deadly weapons
The Solicitor General however contends that a preamble of a statute usually introduced by
the word "whereas", is not an essential part of an act and cannot enlarge or confer powers,
or cure inherent defects in the statute (p. 120, rollo of L-42050-66); that the explanatory
note or enacting clause of the decree, if it indeed limits the violation of the decree, cannot
prevail over the text itself inasmuch as such explanatory note merely states or explains the
reason which prompted the issuance of the decree
the problem of determining what acts fall within the purview of P.D. 9, it becomes necessary
to inquire into the intent and spirit of the decree and this can be found among others in the
preamble or "whereas" clauses which enumerate the facts or events which justify the
promulgation of the decree and the stiff sanctions stated therein.
"A 'preamble' is the key of the statute, to open the minds of the makers as to the mischiefs
which are to be remedied, and objects which are to be accomplished, by the provisions of the
statute." (West Norman Timber v. State, 224 P. 2d 635, 639, cited in Words and Phrases,
"Preamble"; emphasis supplied).
"While the preamble of a statute is not strictly a part thereof, it may, when the statute is in
itself ambiguous and dif􀀼cult of interpretation, be resorted to, but not to create a doubt or
uncertainty which otherwise does not exist."
"(L)egislative intent must be ascertained from a consideration of the statute as a whole, and
not of an isolated part or a particular provision alone. This is a cardinal rule of statutory
construction. For taken in the abstract, a word or phrase might easily convey a meaning quite
21
different from the one actually intended and evident when the word or phrase is considered
with those with which it is associated. Thus, an apparently general provision may have a limited
application if read together with other provisions

Penal statutes are to be construed strictly against the state and liberally in favor of an
accused.

American jurisprudence sets down the reason for this rule to be "the tenderness of the lawof
the rights of individuals; the object is to establish a certain rule by conformity to which mankind
would be safe, and the discretion of the court limited." 11 The purpose is not to enable a guilty
person to escape punishment through a technicality but to provide a precise definition of
forbidden acts

22
MATABUENA vs. CERVANTES
(RATIO LEGIS; SPIRIT OF THE LAW)
FACTS:
Cornelia Matabuena, a sister to the deceased Felix Matabuena, maintains that a donation
made while he was living maritally without benefit of marriage to defendant, now appellee
Petronila Cervantes, was void.
The lower court, after noting that it was made at a time before defendant was married to the
donor, sustained the latter's stand. Hence this appeal
A 1954 decision of the Court of Appeals, Buenaventura v. Bautista, 2 by the then Justice J. B.
L. Reyes, who was appointed to this Court later that year, is indicative of the appropriate
response that should be given. The conclusion reached therein is that a donation between
common-law spouses falls within the prohibition and is "null and void as contrary to public
policy." 3 Such a view merits fully the acceptance of this Court. The decision must be reversed.
, the lower court, after stating that in plaintiff's complaint alleging absolute ownership of the
parcel of land in question, she specifically raised the question that the donation made by Felix
Matabuena to defendant Petronila Cervantes was null and void under the aforesaid article of
the Civil Code and that defendant on the other hand did assert ownership precisely because
such a donation was made in 1956 and her marriage to the deceased did not take place until
1962, noted that when the case was called for trial on November 19, 1965, there was
stipulation of facts which it quoted
The plaintiff and the defendant assisted by their respective counsels, jointly agree and
stipulate: (1) That the deceased Felix Matabuena owned the property in question; (2) That said
Felix Matabuena executed a Deed of Donation inter vivos in favor of Defendant, Petronila
Cervantes over the parcel of land in question on February 20, 1956, which same donation was
accepted by defendant; (3) That the donation of the land to the defendant which took effect
immediately was made during the common law relationship as husband and wife between the
defendant-done and the now deceased donor and later said donor and done were married on
March 28, 1962; (4) That the deceased Felix Matabuena died intestate on September 13, 1962;
(5) That the plaintiff claims the property by reason of being the only sister and nearest
collateral relative of the deceased by virtue of an affidavit of self-adjudication executed by her
in 1962 and had the land declared in her name and paid the estate and inheritance taxes
thereon
The judgment of the lower court on the above facts was adverse to plaintiff. It reasoned out
thus: "A donation under the terms of Article 133 of the Civil Code is void if made between the
spouses during the marriage. When the donation was made by Felix Matabuena in favor of the
defendant on February 20, 1956, Petronila Cervantes and Felix Matabuena were not yet
married. At that time they were not spouses. They became spouses only when they married
on March 28, 1962, six years after the deed of donation had been executed
ISSUE/S & RULING:
Whether the donation was valid – NO
While Art. 133 of the Civil Code considers as void a "donation between the spouses during the
marriage," policy considerations of the most exigent character as well as the dictates of
morality require that the same prohibition should apply to a common-law relationship
If the policy of the law is, in the language of the opinion of the then Justice J.B.L. Reyes of that
Court, "to prohibit donations in favor of the other consort and his descendants because of fear
of undue and improper pressure and influence upon the donor, a prejudice deeply rooted in
our ancient law
then there is every reason to apply the same prohibitive policy to persons living together as
husband and wife without the benefit of nuptials. For it is not to be doubted that assent to
such irregular connection for thirty years bespeaks greater influence of one party over the
other, so that the danger that the law seeks to avoid is correspondingly increased.
'it would not be just that such donations should subsist, lest the condition of those who
incurred guilt should turn out to be better.' So long as marriage remains the cornerstone of
our family law, reason and morality alike demand that the disabilities attached to marriage
should likewise attach to concubinage
It is hardly necessary to add that even in the absence of the above pronouncement, any other
conclusion cannot stand the test of scrutiny. It would be to indict the framers of the Civil Code
for a failure to apply a laudable rule to a situation which in its essentials cannot be
distinguished. Moreover, if it is at all to be differentiated, the policy of the law which embodies
a deeply-rooted notion of what is just and what is right would be nullified if such irregular
relationship instead of being visited with disabilities would be attended with benefits. Certainly
a legal norm should not be susceptible to such a reproach. If there is ever any occasion where
the principle of statutory construction that what is within the spirit of the law is as much a part
of it as what is written, this is it. Otherwise the basic purpose discernible in such codal provision
would not be attained. Whatever omission may be apparent in an interpretation purely literal
of the language used must be remedied by an adherence to its avowed objective
The lack of validity of the donation made by the deceased to defendant Petronila Cervantes
does not necessarily result in plaintiff having exclusive right to the disputed property. Prior to
the death of Felix Matabuena, the relationship between him and the defendant was
legitimated by their marriage on March 28, 1962. She is therefore his widow. As provided for
in the Civil Code, she is entitled to one-half of the inheritance and the plaintiff, as the surviving
sister, to the other half.
23
DEL MAR vs. PAGCOR
(WHEN IS CONSTRUCTION NECESSARY)
FACTS:
The Philippine Amusement and Gaming Corporation is a government-owned and controlled
corporation
Pursuant to Sections 1 and 10 of P.D. No. 1869, respondent PAGCOR requested for legal advice
from the Secretary of Justice as to whether or not it is authorized by its Charter to operate and
manage jai-alai frontons in the country.
the Secretary of Justice opined that "the authority of PAGCOR to operate and maintain games
of chance or gambling extends to jai-alai which is a form of sport or game played for bets and
that the Charter of PAGCOR amounts to a legislative franchise for the purpose.
petitioner Raoul B. del Mar initially @led in G.R. No. 138298 a Petition for Prohibition to
prevent respondent PAGCOR from managing and/or operating the jai-alai or Basque pelota
games, by itself or in agreement with Belle Corporation, on the ground that the controverted
act is patently illegal and devoid of any basis either from the Constitution or PAGCOR's own
Charter
respondent PAGCOR entered into an Agreement with private respondents Belle Jai-Alai
Corporation (BELLE) and Filipinas Gaming Entertainment Totalizator Corporation (FILGAME)
wherein it was agreed that BELLE will make available to PAGCOR the required infrastructure
facilities including the main fronton, as well as provide the needed funding for jai-alai
operations with no @nancial outlay from PAGCOR, while PAGCOR handles the actual
management and operation of jai-alai
Federico S. Sandoval II and Michael T. Defensor @led a Petition for Injunction, docketed as
G.R. No. 138982, which seeks to enjoin respondent PAGCOR from operating or otherwise
managing the jai-alai or Basque pelota games by itself or in joint venture with Belle
Corporation, for being patently illegal, having no basis in the law or the Constitution, and in
usurpation of the authority that properly pertains to the legislative branch of the government.
In this case, a Petition in Intervention was @led by Juan Miguel Zubiri alleging that the
operation by PAGCOR of jai-alai is illegal because it is not included in the scope of PAGCOR's
franchise which covers only games of chance
The Solicitor General claims that the petition, which is actually an action for quo warranto
under Rule 66 of the Rules of Court, against an alleged usurpation by PAGCOR of a franchise to
operate jai alai, should be dismissed outright because only the Solicitor General or public
prosecutor can @le the same; that P.D. No. 1869, the Charter of PAGCOR, authorizes PAGCOR
to regulate and operate games of chance and skill which include jai-alai; and that P.D. No. 1602
did not outlaw jai-alai but merely provided for stiffer penalties to illegal or unauthorized
activities related to jai-alai and other forms of gambling
ISSUE/S & RULING:
Whether PAGCOR legislative franchise includes the right to manage and operate jai-alai - NO
A "franchise" is a special privilege conferred upon a corporation or individual by a government
duly empowered legally to grant it. 15 It is a privilege of public concern which cannot be
exercised at will and pleasure, but should be reserved for public control and administration,
either by the government directly, or by public agents, under such conditions and regulations
as the government may impose on them in the interest of the public. 16 A franchise thus
emanates from a sovereign power 17 and the grant is inherently a legislative power. It may,
however, be derived indirectly from the state through an agency to which the power has been
clearly and validly delegated. 1
A historical study of the creation, growth and development of PAGCOR will readily show
Marcos created PAGCOR on January 1, 1977 by issuing P.D. No. 1067-A . The decree is entitled
"Creating the Philippine Amusements and Gaming Corporation, De@ning Its Powers and
Functions, Providing Funds therefor and for Other Purposes." Its Declaration of Policy 20
trumpeted the intent that PAGCOR was created to implement "the policy of the State to
centralize and integrate all games of chance not heretofore authorized by existing franchises
or permitted by law . . . ." One of its whereas clauses referred to the need to prevent "the
proliferation of illegal casinos or clubs conducting games of chance . . . ." 21 To achieve this
objective, PAGCOR was empowered "to establish and maintain clubs, casinos, branches,
agencies or subsidiaries, or other units anywhere in the Philippines
Section 1 of P.D. No. 1067- B provides the nature and term of PAGCOR'S franchise to maintain
gambling casinos (not a franchise to operate jai-alai), viz
Section 2 of the same decree spells out the scope of the PAGCOR franchise to maintain
gambling casinos (not a franchise to operate jai-alai)
Then came the 1986 EDSA revolution and the end of the Marcos regime. On May 8, 1987,
President Corazon Aquino issued Executive Order No. 169 repealing P.D. Nos. 810, 1124 and
1966 thus revoking the franchise of the Philippine Jai-Alai and Amusement Corporation
controlled by the Romualdezes to operate jai-alai in Manila. PAGCOR's franchise to operate
gambling casinos was not revoked. Neither was it given a franchise to operate jai-alai
PAGCOR's stance becomes more sterile when we consider the law's CD Technologies Asia, Inc.
2018 cdasiaonline.com intent. It cannot be the intent of President Marcos to grant PAGCOR a
franchise to operate jai-alai because a year and a half before it was chartered, he issued P.D.
No. 810 granting Philippine Jai-Alai and Amusement Corporation a 25-year franchise to operate
jai-alai in Manila. This corporation is controlled by his in-laws, the Romualdezes. 29 To assure
that this Romualdez corporation would have no competition, President Marcos earlier revoked
the power of local governments to grant jai-alai franchises. Thus, PAGCOR's stance that P.D.
No. 1067-B is its franchise to operate jai-alai, which would have competed with the
Romualdezes' franchise, extends credulity to the limit. Indeed, P.D. No. 1067-A which created
PAGCOR made it crystal clear that it was to implement "the policy of the State to centralize
and integrate all games of chance not heretofore authorized by existing franchises or
24
permitted by law," which included the Philippine Jai-Alai and Amusement Corporation. (3.d)
There can be no sliver of doubt that under P.D. No. 1869, PAGCOR's franchise is only to operate
gambling casinos and not jai-alai. This conclusion is compelled by a plain reading of its various
provisions
From its creation in 1977 and until 1999, PAGCOR never alleged that it has a franchise to
operate jai-alai. Twenty-two years is a long stretch of silence. It is inexplicable why it never
claimed its alleged franchise for so long a time which could have allowed it to earn billions of
pesos as additional income
To be sure, we need not resort to intellectual jujitsu to determine whether PAGCOR has a
franchise to operate jai-alai. It is easy to tell whether there is a legislative grant or not. Known
as the game of a thousand thrills, jai-alai is a different game, hence, the terms and conditions
imposed on a franchisee are spelled out in standard form. A review of some laws and executive
orders granting a franchise to operate jai-alai will demonstrate these standard terms and
conditions
In @ne, P.D. No. 1869 does not have the standard marks of a law granting a franchise to
operate jai-alai as those found under P.D. No. 810 or E.O. 135 . We cannot blink away from the
stubborn reality that P.D. No. 1869 deals with details pertinent alone to the operation of
gambling casinos. It prescribes the rules and regulations concerning the operation of gambling
casinos such as the place, time, persons who are and are not entitled to play, tax exemptions,
use of foreign exchange, and the exemption of casino employees from the coverage of the Civil
Service Law and the Labor Code
The short point is that P.D. No. 1869 does not have the usual provisions with regards to jai-
alai. The logical inference is that PAGCOR was not given a franchise to operate jaialai frontons.
There is no reason to resist the beguiling rule that acts of incorporation, and statutes granting
other franchises or special bene@ts or privileges to corporations, are to be construed strictly
against the corporations; and whatever is not given in unequivocal terms is understood to be
withheld
he tax treatment between jai-alai operations and gambling casinos are distinct from each
other. Letters of Instruction No. 1439 issued on November 2, 1984 directed the suspension of
the imposition of the increased tax on winnings in horse races and jai-alai under the old
revenue code,
Similarly, under Republic Act No. 8424, or the Tax Reform Act of 1997, there is an amusement
tax imposed on operators of jai-alai (Section 125) and a stamp tax on jaialai tickets (Section
190). There is no corresponding imposition on gambling casinos. Well to note, Section 13 of
P.D. No. 1869 grants to the franchise holder and casino operators tax exemptions from the
payment of customs duties and income tax, except a franchise tax of @ve (5%) percent which
shall be in lieu of all kinds of taxes, levies, fees or assessments of any kind, nature or
description, levied, established or collected by any municipal, provincial, or national
government authority. No similar exemptions have been extended to operators of jai-alai
frontons
P.D. No. 1869, the present Charter of PAGCOR, is a consolidation of P.D. Nos. 1067-A, 1067-B
and 1067-C all issued on January 1, 1977. P.D. No. 1067-A created the PAGCOR and de@ned
its powers and functions; P.D. No. 1067-B granted to PAGCOR a franchise to establish, operate,
and maintain gambling casinos on land or water within the territorial jurisdiction of the
Republic of the Philippines; and P.D. No. 1067-C granted PAGCOR the exclusive right, privilege
and authority to operate and maintain gambling casinos, subject only to the exception of
existing franchises and games of chance permitted by law
Lest the idea gets lost in the shoals of our subconsciousness, let us not forget that PAGCOR is
engaged in business affected with public interest. The phrase "affected with public interest"
means that an industry is subject to control for the public good; 31 it has been considered as
the equivalent of "subject to the exercise of the police power." 32 Perforce, a legislative
franchise to operate jai-alai is imbued with public interest and involves an exercise of police
power. The familiar rule is that laws which grant the right to exercise a part of the police power
of the state are to be construed strictly and any doubt must be resolved against the grant. 33
The legislature is regarded as the guardian of society, and therefore is not presumed to disable
itself or abandon the discharge of its duty. Thus, courts do not assume that the legislature
intended to part away with its power to regulate public morals. 34 The presumption is
inJuenced by constitutional considerations. Constitutions are widely understood to withhold
from legislatures any authority to bargain away their police power 35 for the power to protect
the public interest is beyond abnegation
The dissent also insists that the legislative intent must be sought @rst of all in the language of
the statute itself. In applying a literal interpretation of the provision under Section 11 of P.D.
1869 that ". . . the Corporation is hereby granted . . . the rights, privileges, and authority to
operate and maintain gambling casinos, clubs, and other recreation or amusement places,
sports, gaming pools, i.e., basketball, football, lotteries, etc. . . .," it contends that the extent
and nature of PAGCOR's franchise is so broad that literally all kinds of sports and gaming pools,
including jai-alai, are covered therein. It concluded that since under Section 11 of P.D. No.
1869, games of skill like basketball and football have been lumped together with the word
"lotteries" just before the word "etc." and after the words "gaming pools," it may be deduced
from the wording of the law that when bets or stakes are made in connection with the games
of skill, they may be classi@ed as games of chance under the coverage of PAGCOR's franchise
We reject this simplistic reading of the law considering the social, moral and public policy
implications embedded in the cases at bar. The plain meaning rule used in the dissent rests on
the assumption that there is no ambiguity or obscurity in the language of the law. The fact,
however, that the statute admits of different interpretations is the best evidence that the
statute is vague and ambiguous. 39 It is widely acknowledged that a statute is ambiguous when
it is capable of being understood by reasonably well-informed persons in either of two or more
senses. 40 In the cases at bar, it is diIcult to see how a literal reading of the statutory text would
unerringly reveal the legislative intent. To be sure, the term "jai-alai" was never used and is
nowhere to be found in the law. The conclusion that it is included in the franchise granted to
PAGCOR cannot be based on a mere cursory perusal of and a blind reliance on the ordinary
and plain meaning of the statutory terms used such as "gaming pools" and "lotteries."
Sutherland tells us that a statute is "ambiguous," and so open to explanation by extrinsic aids,
25
not only when its abstract meaning or the connotation of its terms is uncertain, but also when
it is uncertain in its application to, or effect upon, the fact-situation of the case at ba
We reject this simplistic reading of the law considering the social, moral and public policy
implications embedded in the cases at bar. The plain meaning rule used in the dissent rests on
the assumption that there is no ambiguity or obscurity in the language of the law. The fact,
however, that the statute admits of different interpretations is the best evidence that the
statute is vague and ambiguous. 39 It is widely acknowledged that a statute is ambiguous when
it is capable of being understood by reasonably well-informed persons in either of two or more
senses. 40 In the cases at bar, it is diIcult to see how a literal reading of the statutory text would
unerringly reveal the legislative intent. To be sure, the term "jai-alai" was never used and is
nowhere to be found in the law. The conclusion that it is included in the franchise granted to
PAGCOR cannot be based on a mere cursory perusal of and a blind reliance on the ordinary
and plain meaning of the statutory terms used such as "gaming pools" and "lotteries."
Sutherland tells us that a statute is "ambiguous," and so open to explanation by extrinsic aids,
not only when its abstract meaning or the connotation of its terms is uncertain, but also when
it is uncertain in its application to, or effect upon, the fact-situation of the case at ba
It is self-evident that there is a need to be extra cautious in treating this alleged grant of a
franchise as a grant by the legislature, as a grant by the representatives of our people, for
plainly it is not. We now have a real Congress and it is best to let Congress resolve this issue
considering its policy rami@cations on public order and morals.
PEOPLE vs NAZARIO
(WHEN IS CONSTRUCTION NECESSARY)
FACTS:
The petitioner was charged with violation of certain municipal ordinances of the municipal
council of Pagbilao, in Quezon province. By way of confession and avoidance, the petitioner
would admit having committed the acts charged but would claim that the ordinances are
unconstitutional, or, assuming their constitutionality, that they do not apply to him in any
event
the above-named accused, being then the owner and operator of a fishpond situated in the
barrio of Pinagbayanan, of said municipality, did then and there willfully, unlawfully and
feloniously refuse and fail to pay the municipal taxes in the total amount of THREE HUNDRED
SIXTY TWO PESOS AND SIXTY TWO CENTAVOS (P362.62)
From their evidence the prosecution would want to show to the court that the accused, as
lessee or operator of a fishpond in the municipality of Pagbilao, refused, and still refuses, to
pay the municipal taxes for the years 1964, 1965 and 1966, in violation of Municipal Ordinance
No. 4, series of 1955, as amended by Municipal Ordinance No. 15, series of 1965, and finally
amended by Municipal Ordinance No. 12, series of 1966
the accused, by his evidence, tends to show to the court that the taxes sought to be collected
have already lapsed and that there is no law empowering municipalities to pass ordinances
taxing fishpond operators. The defense, by their evidence, tried to show further that, as lessee
of a forest land to be converted into a fishpond, he is not covered by said municipal ordinances;
and finally that the accused should not be taxed as fishpond operator because there is no
fishpond yet being operated by him, considering that the supposed fishpond was under
construction during the period covered by the taxes sought to be collected. Finally, the
defendant claims that the ordinance in question is ultra vires as it is outside of the power of
the municipal council of Pagbilao, Quezon, to enact; and that the defendant claims that the
ordinance in question is ambiguous and uncertain.
There is no question from the evidences presented that the accused is a lessee of a parcel of
forest land, with an area of 27.1998 hectares, for fishpond purposes, under Fishpond Lease
Agreement No. 1066, entered into by the accused and the government, through the Secretary
of Agriculture and Natural Resources on August 21, 1959
There is no question from the evidences presented that the 27.1998 hectares of land leased
by the defendant from the government for fishpond purposes was actually converted into
fishpond and used as such
The ordinances in question are Ordinance No. 4, series of 1955, Ordinance No. 15, series of
1965, and Ordinance No. 12, series of 1966, of the Municipal Council of Pagbilao
ISSUE/S & RULING:
As a rule, a statute or act may be said to be vague when it lacks comprehensible standards that
men "of common intelligence must necessarily guess at its meaning and differ as to its
application." 11 It is repugnant to the Constitution in two respects: (1) it violates due process
for failure to accord persons, especially the parties targetted by it, fair notice of the conduct
to avoid; and (2) it leaves law enforcers unbridled discretion in carrying out its provisions and
becomes an arbitrary flexing of the Government muscle
It must further be distinguished from statutes that are apparently ambiguous yet fairly
applicable to certain types of activities. In that event, such statutes may not be challenged
whenever directed against such activities
In no way may the ordinances at bar be said to be tainted with the vice of vagueness. It is
unmistakable from their very provisions that the appellant falls within its coverage. As the
actual operator of the fishponds, he comes within the term "manager." He does not deny the
fact that he financed the construction of the fishponds, introduced fish fries into the fishponds,
and had employed laborers to maintain them. 31 While it appears that it is the National
Government which owns them, 32 the Government never shared in the profits they had
generated. It is therefore only logical that he shoulders the burden of tax under the said
ordinances
We agree with the trial court that the ordinances are in the character of revenue measures 33
designed to assist the coffers of the municipality of Pagbilao. And obviously, it cannot be the
26
owner, the Government, on whom liability should attach, for one thing, upon the ancient
principle that the Government is immune from taxes and for another, since it is not the
Government that had been making money from the venture
Suffice it to say that as the actual operator of the fishponds in question, and as the recipient
of profits brought about by the business, the appellant is clearly liable for the municipal taxes
in question. He cannot say that he did not have a fair notice of such a liability to make such
ordinances vague
The next inquiry is whether or not they can be said to be ex post facto measures. The appellant
argues that they are "Amendment No. 12 passed on September 19, 1966, clearly provides that
the payment of the imposed tax shall 'beginning and taking effect from the year 1964, if the
fishpond started operating before the year 1964.' In other words, it penalizes acts or events
occurring before its passage, that is to say, 1964 and even prior thereto
"Municipal Ordinance No. 4 was passed on May 14, 1955. 38 Hence, it cannot be said that the
amendment (under Ordinance No. 12) is being made to apply retroactively (to 1964) since the
reckoning period is 1955 (date of enactment). Essentially, Ordinances Nos. 12 and 15 are in the
nature of curative measures intended to facilitate and enhance the collection of revenues the
original act, Ordinance No. 4, had prescribed. 39 Moreover, the act (of nonpayment of the tax),
had been, since 1955, made punishable, and it cannot be said that Ordinance No. 12 imposes
a retroactive penalty. As we have noted, it operates to grant amnesty to operators who had
been delinquent between 1955 and 1964
"Municipal Ordinance No. 4 was passed on May 14, 1955. 38 Hence, it cannot be said that the
amendment (under Ordinance No. 12) is being made to apply retroactively (to 1964) since the
reckoning period is 1955 (date of enactment). Essentially, Ordinances Nos. 12 and 15 are in the
nature of curative measures intended to facilitate and enhance the collection of revenues the
original act, Ordinance No. 4, had prescribed. 39 Moreover, the act (of nonpayment of the tax),
had been, since 1955, made punishable, and it cannot be said that Ordinance No. 12 imposes
a retroactive penalty. As we have noted, it operates to grant amnesty to operators who had
been delinquent between 1955 and 1964
(three years after the 'approval of the fishpond' by the Bureau of Fisheries, and upon an
uncertain event (if the fishpond started operating before 1964), also to be determined by an
uncertain individual or individuals." 34 Ordinance No. 15, in making the tax payable "after the
lapse of three (3) years starting from the date said fishpond is approved by the Bureau of
Fisheries," 35 is unequivocal about the date of payment, and its amendment by Ordinance No.
12, reckoning liability thereunder "beginning and taking effect from the year 1964 if the
fishpond started operating before the year 1964," 36 does not give rise to any ambiguity. In
either case, the dates of payment have been definitely established.
As it stands, then, liability for the tax accrues on January 1, 1964 for fishponds in operation
prior thereto (Ordinance No. 12), and for new fishponds, three years after their approval by
the Bureau of Fisheries (Ordinance No. 15). This is so since the amendatory act (Ordinance No.
12) merely granted amnesty unto old, delinquent fishpond operators. It did not repeal its
mother ordinances (Nos. 4 and 15). With respect to new operators, Ordinance No. 15 should
still prevail
IN RE: ALLEN
FACTS:
Frank Stanley Allen, who is an alien, claims that he is unlawfully detained and restrained of his
liberty in Manila, P. I., by W. Morgan Shuster, as Collector of Customs for the Philippine
Archipelago, who threatens to deport the petitioner from the Islands for the reason that said
Collector claims that the petitioner is a prohibited alien contract laborer whose importation is
forbidden by the act of Congress approved March 3, 1903, entitled "An act to regulate the
immigration of aliens into the United States
Attention is also called by the petitioner to section 24 of said act of Congress, which provides
for the appointment of immigration inspectors by the Secretary of the Treasury upon the
recommendation of the Commissioner-General of Immigration, in accordance with the civil-
service rules and regulations in the act of June 16, 1883
The petitioner insists that, inasmuch as by said act of Congress it is provided that for the
"purpose of this act the words 'United States,' as used in the title as well as in the various
sections of this act," shall be construed to mean the United States and any waters, territory,
or other place now subject to the jurisdiction thereof; and that, as by section 22 of the act the
Commissioner-General of Immigration, under the supervision and direction of the Secretary of
the Treasury of the United States, is charged with the administration of all laws relating to the
immigration of aliens into the United States, and is required to establish rules and regulations
relating thereto, the said Collector of Customs is without jurisdiction to act in the premises, as
he has not been authorized to execute the provisions of the law by the Secretary of the
Treasury, or by the Commissioner-General of Immigration, or by act of Congress
Attention is also called by the petitioner to section 24 of said act of Congress, which provides
for the appointment of immigration inspectors by the Secretary of the Treasury upon the
recommendation of the Commissioner-General of Immigration, in accordance with the civil-
service rules and regulations in the act of June 16, 1883
ISSUE/S & RULING:
Has the Collector of Customs for the Philippine Archipelago lawful authority to execute, or
cause to be executed, so much of said act of Congress as provides for the detention and
deportation of prohibited aliens
On the 6th day of June, 1899, the Acting Secretary of War issued an order in which he stated
that, in accordance with the provisions of circular No. 13, he proclaimed, published, and
applied to the Philippine Islands immigration regulations for the information and guidance of
all concerned. These regulations briefly required the enforcement of all the acts of Congress
relating to immigration, passed prior to June 6, 1899, and the collectors of customs of the
Islands were charged with the execution of the immigration and labor laws; with the removal
and examination of immigrants; with the keeping of a record of the prohibited classes;
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provision was made for private examinations and for the presence of counsel; for appeals from
the decisions of inspectors or collectors of customs to the Collector of Customs for the
Archipelago; for the expense of keeping prohibited persons; for the deportation of rejected
immigrants; for the listing of immigrants by ship's masters, and for penalties for failure to
deliver lists to the Collector. Article III of these regulations is as follows:
"Collectors of customs are charged, within their respective districts, with the execution of the
laws pertaining to immigration, and all importation of laborers under contract or agreement
to perform labor in the Philippine Islands. They will employ all customs, immigration, and other
officers assigned to them for duty in the enforcement of the immigration acts; and all such
officers are hereby designated and authorized to act as immigration officers.
Among the laws enumerated and sent by him which were to be enforced in these Islands by
the collectors of customs, he specified the following: the acts approved March 3, 1875; August
3, 1882; June 26, 1884; February 26, 1885; chapter 551 of Laws of 1891; chapters 114 and 206,
Laws of 1893; and the act approved June 30, 1896, which changed the title of the
Superintendent of Immigration to that of Commissioner-General of Immigration, and vested
in him, under the Secretary of the Treasury, the administration of the alien contractlabor laws,
and the Chinese exclusion act approved June 6, 1900. So that, at the very time Congress passed
the immigration law, on March 3, 1903, all these existing laws were enforced here, not under
the supervision and direction of the Secretary of the Treasury and the Commissioner-General
of Immigration, but by the collectors of customs, their inspectors and immigration officers,
with the right of appeal to the Insular Collector, under the supervision and direction of the
Secretary of War and the Commissioners of the Philippine Islands
In promulgating this act of Congress in these Islands, Governor Taft stated that it had been
decided by the legal adviser of the Secretary of War that while this law, in its CD Technologies
Asia, Inc. © 2016 cdasiaonline.com restrictions upon the admission of aliens into the United
States, applies to the Philippines, the provisions therein made for-the enforcement of the law
by the Secretary of the Treasury Department of the United States and the Commissioner-
General of Immigration do not apply here, and that the new immigration law should be
enforced in the same manner in these Islands as the previous law on the same subject was
enforced — that is, though the Collector of Customs and his subordinate officers. The Secretary
of the Treasury must also have given a similar construction of this law, otherwise he would,
without doubt, have appointed immigration inspectors and established immigration stations
in the Islands long ago — in fact, as far back as April 29, 1902, when the Chinese exclusion act
was made applicable to the Philippines, he being then charged with its enforcement. It follows
that these two Departments of the Government, the two Departments concerned in the
enforcement of the immigration and exclusion laws, have held that the duty of administering
these laws in the Philippines was to be continued in the customs department of the Islands,
and by its immigration inspectors
RUFINO SONS vs CTA
FACTS:
Petitioner appellant Rufino Lopez & Sons, Inc. is appealing from a resolution of the Court of
Tax Appeals dismissing its appeal from a decision of the Collector of Customs for the Port of
Manila, assessing additional fees on petitioner for a certain importation of wire netting
Lopez & Sons imported hexagonal wire netting from Hamburg, Germany. The Manila Collector
of Customs assessed the corresponding customs duties on the importation on the basis of
consular and supplier invoices. Said customs duties were paid and the shipments were
released. Subsequently, however, the Collector reassessed the dollar value of the cost and
freight of said wire netting and as a result of the reassessment, additional customs duties in
the amount of P1,966.59 were levied and imposed upon petitioner. Failing to secure a
reconsideration of the reassessment and levy of additional customs duties, Lopez & Sons
appealed to the COurt of Tax Appeals. Acting upon a motion to dismiss the appeal, filed by the
Solicitor General on the ground of lack of jurisdiction, the Tax Court, by its resolution of May
23, 1955, dismissed the appeal on the ground that it had no jurisdiction to review decisions of
the Collector of Customs of Manila, citing section 7 of Republic No. 1125, creating said tax
court.
There is really a discrepancy between Sections 7 and 11 above reproduced. Section 7 provides
that the Court of Tax Appeals has exclusive appellate jurisdiction to review by appeal decisions
of the Collector of Internal Revenue, decisions of the Commissioner of Customs and decisions
of provincial or city Board of Assessment Appeals on cases mentioned in said section. On the
other hand, section 11 of the same Republic Act in listing and enumerating the persons and
entities who may appeal as well as the effect of said appeal, mentions those affected by a
decision or ruling of the Collector of Internal Revenue, the Collector of Customs or any
provincial or City Board of Assessment Appeals, and fails to mention the Commissioner of
Customs
However, section 7 of the Act above reproduced specifically provides that the Court of Tax
Appeals has appellate jurisdiction to review decisions of the Commissioner of Customs. That
legal provision conferring appellate jurisdiction on the Court of Tax Appeals to review
decisions of the Commissioner of Customs would be empty, meaningless, and unenforceable
because under Section 11, no person affected by the decision of the Commissioner of
Customs may appeal to the Tax Court.
We are in entire accord with the Tax Court and the Solicitor General that a clerical error was
committed in section 11, mentioning therein the Collector of Customs. It should be, as it was
meant to be, the Commissioner of Customs. There are several reasons in support of this
view. Under the Customs Law, found in sections 1137 to 1419 of the Revised Administrative
Code, the Commissioner of Customs (Insular Collector of Customs) is the Chief of the Bureau
of Customs and has jurisdiction over the whole country as regards the enforcement of the
Customs Law, whereas, there are about sixteen Collectors of Customs for the sixteen
collection districts and principal ports of entry into which the Philippines has been divided.
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These Collectors of Customs are subordinates of the Commissioner of Customs over whom
he has supervision and contro

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