G.R. Nos.
L-18169, L-18262 & L-21434 July 31, 1964 After audit, the petitioner determined a deficiency of P16,116.00, which amount, the
COMMISSIONER OF INTERNAL REVENUES, petitioner,
vs.
V.E. LEDNICKY and MARIA VALERO LEDNICKY, respondents.
Office of the Solicitor General for petitioner.
Ozaeta, Gibbs and Ozaeta for respondents.
REYES, J.B.L., J.:
The above-captioned cases were elevated to this Court under separate petitions by
the Commissioner for review of the corresponding decisions of the Court of Tax
Appeals. Since these cases involve the same parties and issues akin to each case
presented, they are herein decided jointly.
The respondents, V. E. Lednicky and Maria Valero Lednicky, are husband and wife,
respectively, both American citizens residing in the Philippines, and have derived all
their income from Philippine sources for the taxable years in question.
In compliance with local law, the aforesaid respondents, on 27 March 1957, filed their
income tax return for 1956, reporting therein a gross income of P1,017,287. 65 and a
net income of P733,809.44 on which the amount of P317,395.4 was assessed after
deducting P4,805.59 as withholding tax. Pursuant to the petitioner's assessment
notice, the respondents paid the total amount of P326,247.41, inclusive of the withheld
taxes, on 15 April 1957.
On 17 March 1959, the respondents Lednickys filed an amended income tax return for
1956. The amendment consists in a claimed deduction of P205,939.24 paid in 1956 to
the United States government as federal income tax for 1956. Simultaneously with the
filing of the amended return, the respondents requested the refund of P112,437.90.
When the petitioner Commissioner of Internal Revenue failed to answer the claim for
refund, the respondents filed their petition with the Tax Court on 11 April 1959 as CTA
Case No. 646, which is now G. R. No. L-18286 in the Supreme Court.
G. R. No. L-18169 (formerly CTA Case No. 570) is also a claim for refund in the
amount of P150,269.00, as alleged overpaid income tax for 1955, the facts of which
are as follows:
On 28 February 1956, the same respondents-spouses filed their domestic income tax
return for 1955, reporting a gross income of P1,771,124.63 and a net income of
P1,052,550.67. On 19 April 1956, they filed an amended income tax return, the
amendment upon the original being a lesser net income of P1,012,554.51, and, on the
basis of this amended return, they paid P570,252.00, inclusive of withholding taxes.
respondents paid on 5 December 1956.
Back in 1955, however, the Lednickys filed with the U.S. Internal Revenue Agent in
Manila their federal income tax return for the years 1947, 1951, 1952, 1953, and 1954
on income from Philippine sources on a cash basis. Payment of these federal income
taxes, including penalties and delinquency interest in the amount of P264,588.82,
were made in 1955 to the U.S. Director of Internal Revenue, Baltimore, Maryland,
through the National City Bank of New York, Manila Branch. Exchange and bank
charges in remitting payment totaled P4,143.91.
Wherefore, the parties respectfully pray that the foregoing stipulation of facts be
admitted and approved by this Honorable Court, without prejudice to the parties
adducing other evidence to prove their case not covered by this stipulation of
facts. 1äwphï1.ñët
On 11 August 1958, the said respondents amended their Philippine income tax return
for 1955 to include the following deductions:
U.S. Federal income taxes P471,867.32
Interest accrued up to May 15, 1955 40,333.92
Exchange and bank charges 4,143.91
Total P516,345.15
and therewith filed a claim for refund of the sum of P166,384.00, which was later
reduced to P150,269.00.
The respondents Lednicky brought suit in the Tax Court, which was docketed therein
as CTA Case No. 570.
In G. R. No. 21434 (CTA Case No. 783), the facts are similar, but refer to respondents
Lednickys' income tax return for 1957, filed on 28 February 1958, and for which
respondents paid a total sum of P196,799.65. In 1959, they filed an amended return
for 1957, claiming deduction of P190,755.80, representing taxes paid to the U.S.
Government on income derived wholly from Philippine sources. On the strength
thereof, respondents seek refund of P90 520.75 as overpayment. The Tax Court again
decided for respondents.
The common issue in all three cases, and one that is of first impression in this
jurisdiction, is whether a citizen of the United States residing in the Philippines, who
derives income wholly from sources within the Republic of the Philippines, may deduct
from his gross income the income taxes he has paid to the United States government
for the taxable year on the strength of section 30 (C-1) of the Philippine Internal
Revenue Code, reading as follows:
SEC. 30. Deduction from gross income. — In computing net income there
shall be allowed as deductions —
(a) ...
It is well to note that the tax credit so authorized is limited under paragraph
4 (A and B) of the same subsection, in the following terms:
(b) ...
(c) Taxes:
(1) In general. — Taxes paid or accrued within the
taxable year, except —
(A) The income tax provided for under this
Title;
(B) Income, war-profits, and excess profits
taxes imposed by the authority of any foreign
country; but this deduction shall be allowed in
the case of a taxpayer who does not signify in
his return his desire to have to any extent the
benefits of paragraph (3) of this subsection
(relating to credit for foreign countries);
(C) Estate, inheritance and gift taxes; and
(D) Taxes assessed against local benefits of
a kind tending to increase the value of the
property assessed. (Emphasis supplied)
The Tax Court held that they may be deducted because of the undenied fact
that the respondent spouses did not "signify" in their income tax return a
desire to avail themselves of the benefits of paragraph 3 (B) of the
subsection, which reads:
Par. (c) (3) Credits against tax for taxes of foreign countries. — If
the taxpayer signifies in his return his desire to have the benefits
of this paragraph, the tax imposed by this Title shall be credited
with —
(A) ...;
(B) Alien resident of the Philippines. — In the case of
an alien resident of the Philippines, the amount of any
such taxes paid or accrued during the taxable year to
any foreign country, if the foreign country of which such
alien resident is a citizen or subject, in imposing such
taxes, allows a similar credit to citizens of the
Philippines residing in such country;
Par. (c) (4) Limitation on credit. — The amount of the credit taken
under this section shall be subject to each of the following
limitations:
(A) The amount of the credit in respect to the tax paid
or accrued to any country shall not exceed the same
proportion of the tax against which such credit is taken,
which the taxpayer's net income from sources within
such country taxable under this Title bears to his entire
net income for the same taxable year; and
(B) The total amount of the credit shall not exceed the
same proportion of the tax against which such credit is
taken, which the taxpayer's net income from sources
without the Philippines taxable under this Title bears to
his entire net income for the same taxable year.
We agree with appellant Commissioner that the Construction and
wording of Section 30 (c) (1) (B) of the Internal Revenue Act
shows the law's intent that the right to deduct income taxes paid
to foreign government from the taxpayer's gross income is given
only as an alternative or substitute to his right to claim a tax credit
for such foreign income taxes under section 30 (c) (3) and (4); so
that unless the alien resident has a right to claim such tax credit if
he so chooses, he is precluded from deducting the foreign income
taxes from his gross income. For it is obvious that in prescribing
that such deduction shall be allowed in the case of a taxpayer
who does not signify in his return his desire to have to any extent
the benefits of paragraph (3) (relating to credits for taxes paid to
foreign countries), the statute assumes that the taxpayer in
question also may signify his desire to claim a tax credit and
waive the deduction; otherwise, the foreign taxes would always be
deductible, and their mention in the list of non-deductible items in
Section 30(c) might as well have been omitted, or at least
expressly limited to taxes on income from sources outside the
Philippine Islands.
 Had the law intended that foreign income taxes could be
deducted from gross income in any event, regardless of the
taxpayer's right to claim a tax credit, it is the latter right that
should be conditioned upon the taxpayer's waiving the deduction;
in which Case the right to reduction under subsection (c-1-B)
would have been made absolute or unconditional (by omitting
foreign taxes from the enumeration of non-deductions), while the
right to a tax credit under subsection (c-3) would have been
expressly conditioned upon the taxpayer's not claiming any
deduction under subsection (c-1). In other words, if the law had
been intended to operate as contended by the respondent
taxpayers and by the Court of Tax Appeals section 30 (subsection
(c-1) instead of providing as at present:
SEC. 30. Deduction from gross income. — In computing net income there
shall be allowed as deductions —
(a) ...
(b) ...
(c) Taxes:
(1) In general. — Taxes paid or accrued within the
taxable year, except —
(A) The income tax provided for under this
Title;
(B) Income, war-profits, and excess profits
taxes imposed by the authority of any foreign
country; but this deduction shall be allowed in
the case of a taxpayer who does not signify in
his return his desire to have to any extent the
benefits of paragraph (3) of this subsection
(relating to credit for taxes of foreign
countries);
(C) Estate, inheritance and gift taxes; and
(D) Taxes assessed against local benefits of
a kind tending to increase the value of the
property assessed.
would have merely provided:
SEC. 30. Decision from grow income. — In computing net income there
shall be allowed as deductions:
(a) ...
(b) ...
(c) Taxes paid or accrued within the taxable year, EXCEPT —
(A) The income tax provided for in this Title;
(B) Omitted or else worded as follows:
Income, war profits and excess profits taxes imposed by authority
of any foreign country on income earned within the Philippines if
the taxpayer does not claim the benefits under paragraph 3 of this
subsection;
(C) Estate, inheritance or gift taxes;
(D) Taxes assessed against local benefits of a kind tending to
increase the value of the property assessed.
while subsection (c-3) would have been made conditional in the following or equivalent
terms:
(3) Credits against tax for taxes of foreign countries. — If the taxpayer has
not deducted such taxes from his gross income but signifies in his return his
desire to have the benefits of this paragraph, the tax imposed by Title shall
be credited with ... (etc.).
Petitioners admit in their brief that the purpose of the law is to prevent the taxpayer
from claiming twice the benefits of his payment of foreign taxes, by deduction from
gross income (subs. c-1) and by tax credit (subs. c-3). This danger of double credit
certainly can not exist if the taxpayer can not claim benefit under either of these
headings at his option, so that he must be entitled to a tax credit (respondent
taxpayers admittedly are not so entitled because all their income is derived from
Philippine sources), or the option to deduct from gross income disappears altogether.
Much stress is laid on the thesis that if the respondent taxpayers are not allowed to
deduct the income taxes they are required to pay to the government of the United
States in their return for Philippine income tax, they would be subjected to double
taxation. What respondents fail to observe is that double taxation becomes obnoxious
only where the taxpayer is taxed twice for the benefit of the same governmental
entity (cf. Manila vs. Interisland Gas Service, 52 Off. Gaz. 6579; Manuf. Life Ins. Co.
vs. Meer, 89 Phil. 357). In the present case, while the taxpayers would have to pay
two taxes on the same income, the Philippine government only receives the proceeds
of one tax. As between the Philippines, where the income was earned and where the
taxpayer is domiciled, and the United States, where that income was not earned and
where the taxpayer did not reside, it is indisputable that justice and equity demand that
the tax on the income should accrue to the benefit of the Philippines. Any relief from
the alleged double taxation should come from the United States, and not from the
Philippines, since the former's right to burden the taxpayer is solely predicated on his
citizenship, without contributing to the production of the wealth that is being taxed.

Aside from not conforming to the fundamental doctrine of income taxation that the
right of a government to tax income emanates from its partnership in the production of
income, by providing the protection, resources, incentive, and proper climate for such
production, the interpretation given by the respondents to the revenue law provision in
question operates, in its application, to place a resident alien with only domestic
sources of income in an equal, if not in a better, position than one who has both
domestic and foreign sources of income, a situation which is manifestly unfair and
short of logic.

Finally, to allow an alien resident to deduct from his gross income whatever taxes he
pays to his own government amounts to conferring on the latter the power to reduce
the tax income of the Philippine government simply by increasing the tax rates on the
alien resident. Everytime the rate of taxation imposed upon an alien resident is
increased by his own government, his deduction from Philippine taxes would
correspondingly increase, and the proceeds for the Philippines diminished, thereby
subordinating our own taxes to those levied by a foreign government. Such a result is
incompatible with the status of the Philippines as an independent and sovereign state.

IN VIEW OF THE FOREGOING, the decisions of the Court of Tax Appeals are
reversed, and, the disallowance of the refunds claimed by the respondents Lednicky is
affirmed, with costs against said respondents-appellees.

Bengzon, C.J., Padilla, Bautista Angelo, Labrador, Concepcion, Paredes, Regala and
Makalintal, JJ., concur.
G.R. No. 134330 March 1, 2001
SPOUSES ENRIQUE M. BELO and FLORENCIA G. BELO, petitioners,
vs.
PHILIPPINE NATIONAL BANK and SPOUSES MARCOS and ARSENIA
ESLABON, respondents.
DE LEON, JR., J.:
Before us is a petition for review on certiorari of the Decision1 and Resolution2 in CA-
G.R. No. 53865 of the Court of Appeals3 dated May 21, 1998 and June 29, 1998,
respectively, which modified the Decision4 dated April 30, 1996 of the Regional Trial
Court of Roxas City, Branch 19 in a suit5 for Declaration of Nullity of the Contract of
Mortgage.
The facts are as follows:
Eduarda Belo owned an agricultural land with an area of six hundred sixty one
thousand two hundred eighty eight (661,288) square meters located in Timpas,
Panitan, Capiz, covered and described in Transfer Certificate of Title (TCT for brevity)
No. T-7493. She leased a portion of the said tract of land to respondents spouses
Marcos and Arsenia Eslabon in connection with the said spouses' sugar plantation
business. The lease contract was effective for a period of seven (7) years at the rental
rate of Seven Thousand Pesos (P7,000.00) per year.
Before the expiration of the redemption period, petitioners spouses Belo tendered
payment for the redemption of the agricultural land in the amount of Four Hundred
Eighty Four Thousand Four Hundred Eighty Two Pesos and Ninety Six Centavos
(P484,482.96), which includes the bid price of respondent PNB, plus interest and
expenses as provided under Act No. 3135.
However, respondent PNB rejected the tender of payment of petitioners spouses Belo.
It contended that the redemption price should be the total claim of the bank on the
date of the auction sale and custody of property plus charges accrued and
interests amounting to Two Million Seven Hundred Seventy Nine Thousand Nine
Hundred Seventy Eight and Seventy Two Centavos (P2,779,978.72).6 Petitioners
spouses disagreed and refused to pay the said total claim of respondent PNB.
On June 18, 1992, petitioners spouses Belo initiated in the Regional Trial Court of
Roxas City, Civil Case No. V-6182 which is an action for declaration of nullity of
mortgage, with an alternative cause of action, in the event that the accommodation
mortgage be held to be valid, to compel respondent PNB to accept the redemption
price tendered by petitioners spouses Belo which is based on the winning bid price of
respondent PNB in the extrajudicial foreclosure in the amount of Four Hundred Forty
Seven Thousand Six Hundred Thirty Two Pesos (P447,632.00) plus interest and
expenses.
In its Answer, respondent PNB raised, among others, the following defenses, to wit:
xxx xxx xxx

To finance their business venture, respondents spouses Eslabon obtained a loan from
77. In all loan contracts granted and mortgage contracts executed under the
respondent Philippine National Bank (PNB for brevity) secured by a real estate
1975 Revised Charter (PD 694, as amended), the proper rate of interest to
mortgage on their own four (4) residential houses located in Roxas City, as well as on
be charged during the redemption period is the rate specified in the
the agricultural land owned by Eduarda Belo. The assent of Eduarda Belo to the
mortgage contract based on Sec. 25 7 of PD 694 and the mortgage contract
mortgage was acquired through a special power of attorney which she executed in
which incorporates by reference the provisions of the PNB Charters.
favor of respondent Marcos Eslabon on June 15, 1982.
Additionally, under Sec. 78 of the General Banking Act (RA No. 337, as
amended) made applicable to PNB pursuant to Sec. 38 of PD No. 694, the
Inasmuch as the respondents spouses Eslabon failed to pay their loan obligation, rate of interest collectible during the redemption period is the rate specified
extrajudicial foreclosure proceedings against the mortgaged properties were instituted in the mortgage contract.
by respondent PNB. At the auction sale on June 10, 1991, respondent PNB was the
highest bidder of the foreclosed properties at Four Hundred Forty Seven Thousand
78. Since plaintiffs failed to tender and pay the required amount for
Six Hundred Thirty Two Pesos (P447,632.00).
redemption of the property under the provisions of the General Banking Act,
no redemption was validly effected;8
In a letter dated August 28, 1991, respondent PNB appraised Eduarda Belo of the
sale at public auction of her agricultural land on June 10, 1991 as well as the
xxx xxx xxx
registration of the Certificate of Sheriff's Sale in its favor on July 1, 1991, and the one-
year period to redeem the land.
After trial on the merits, the trial court rendered its Decision dated April 30, 1996
granting the alternative cause of action of spouses Belo, the decretal portion of which
Meanwhile, Eduarda Belo sold her right of redemption to petitioners spouses Enrique
reads:
and Florencia Belo under a deed of absolute sale of proprietary and redemption rights.
 WHEREFORE, in view of all the foregoing, judgment is hereby rendered in
favor of plaintiffs Spouses Enrique M. Belo and Florencia G. Belo and
against defendants Philippine National Bank and Spouses Marcos and
Arsenia Eslabon:
1. Making the injunction issued by the court permanent, insofar as
the property of Eduarda Belo covered by Transfer Certificate of
Title No. T-7493 is concerned;
2. Ordering defendant Philippine National Bank to allow plaintiff
Enrique M. Belo to redeem only Eduarda Belo's property situated
in Brgy. Timpas, Panitan, Capiz, and covered by Transfer
Certificate of Title No. T-7493 by paying only its bid price of
P447,632.00, plus interest and other charges provided for in
Section 30, Rule 39 of the Rules of Court, less the loan value, as
originally appraised by said defendant Bank, of the foreclosed
four (4) residential lots of defendants Spouses Marcos and
Arsenia Eslabon; and
3. Dismissing for lack of merit the respective counterclaims of
defendants Philippine National Bank and spouses Marcos and
Arsenia Eslabon.
With costs against defendants.
SO ORDERED.9
Dissatisfied with the foregoing judgment of the trial court, respondent PNB appealed to
the Court of Appeals. In its Decision rendered on May 21, 1998, the appellate court,
while upholding the decision of the trial court on the validity of the real estate
mortgage on Eduarda Belo's property, the extrajudicial foreclosure and the public
auction sale, modified the trial court's finding on the appropriate redemption price by
ruling that the petitioners spouses Belo should pay the entire amount due to PNB
under the mortgage deed at the time of the foreclosure sale plus interest, costs and
expenses.10
11
Petitioners spouses Belo sought reconsideration of the said Decision but the same
was denied by the appellate court in its Resolution promulgated on June 29, 1998,
ratiocinating, thus:
Once more, the Court shies away from declaring the nullity of the mortgage
contract obligating Eduarda Belo as co-mortgagor, considering that it has
not been sufficiently established that Eduarda Belo's assent to the special
power of attorney and to the mortgage contract was tainted by any vitiating
cause. Moreover, in tendering an offer to redeem the property (Exhibit "20",
p. 602 Record) after its extrajudicial foreclosure, she has thereby admitted
the validity of the mortgage, as well as the transactions leading to its
inception. Eduarda Belo, and the appellees as mere assignees of Eduarda's
right to redeem the property, are therefore estopped from questioning the
efficacy of the mortgage and its subsequent foreclosure. 12
The appellate court further declared that petitioners spouses Belo are obligated to pay
the total bank's claim representing the redemption price for the foreclosed properties,
as provided by Section 25 of P.D No. 694, holding that:
On the other hand, the court's ruling that the appellees, being the assignee
of the right of repurchase of Eduarda Belo, were bound by the redemption
price as provided by Section 25 of P.D. 694, stands. The attack on the
constitutionality of Section 25 of P.D. 694 cannot be allowed, as the High
Court, in previous instances, (Dulay v. Carriaga, 123 SCRA 794 [1983];
Philippine National Bank v. Remigio, 231 SCRA 362 [1994]) has regarded
the said provision of law with respect, using the same in determining the
proper redemption price in foreclosure of mortgages involving the PNB as
mortgagee.
The terms of the said provision are quite clear and leave no room for
qualification, as the appellees would have us rule. The said rule, as
amended, makes no specific distinction as to assignees or transferees of
the mortgagor of his redemptive right. In the absence of such distinction by
the law, the Court cannot make a distinction. As admitted assignees of
Eduarda Belo's right of redemption, the appellees succeed to the precise
right of Eduarda including all conditions attendant to such right.
Moreover, the indivisible character of a contract of mortgage (Article 2089,
Civil Code) will extend to apply in the redemption stage of the mortgage.
As we have previously remarked, Section 25 of P.D. 694 is a sanctioned
deviation from the rule embodied in Rule 39, Section 30 of the Rules of
Court, and is a special protection given to government lending institutions,
particularly, the Philippine National Bank. (Dulay v. Carriaga, supra)13
Hence, the instant petition.
During the oral argument, petitioners, through counsel, Atty. Enrique M. Belo, agreed
to limit the assignment of errors to the following:
xxx xxx xxx
II. THE COURT OF APPEALS ERRED IN NOT REVERSING THE TRIAL
COURT ON THE BASIS OF THE ASSIGNMENT OF ERRORS ALLEGED
BY PETITIONERS IN THEIR BRIEF:
 (1) THAT THE SPECIAL POWER OF ATTORNEY EXECUTED
BY EDUARDA BELO IN FAVOR OF RESPONDENT ESLABON
WAS NULL AND VOID:
(2) THAT THE REAL ESTATE MORTGAGE EXECUTED BY
RESPONDENT MARCOS ESLABON UNDER SAID INVALID
SPECIAL POWER OF ATTORNEY IS ALSO NULL AND VOID;
III. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT
RESPONDENT PNB ACTED IN BAD FAITH AND CONNIVED WITH
RESPONDENTS-DEBTORS ESLABONS TO OBTAIN THE CONSENT OF
EDUARDA BELO, PETITIONERS' PREDECESSOR, THROUGH FRAUD.
IV. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT
RESPONDENT PNB WAS NEGLIGENT IN THE PERFORMANCE OF ITS
DUTY AS COMMERCIAL MONEY LENDER.
V. THE COURT OF APPEALS ERRED IN HOLDING THAT EDUARDA
BELO, PETITIONERS' PREDECESSOR, HAD WAIVED THE RIGHT TO
QUESTION THE LEGALITY OF THE ACCOMMODATION MORTGAGE.
VI. THE COURT OF APPEALS ERRED IN REVERSING THE TRIAL
COURT BY HOLDING THAT ON REDEMPTION, PETITIONERS SHOULD
PAY THE ENTIRE CLAIM OF PNB AGAINST RESPONDENTS-DEBTORS
ESLABONS.
VII. THE COURT OF APPEALS ERRED IN NOT ORDERING THAT
SHOULD PETITIONERS DECIDE TO PAY THE ENTIRE CLAIM OF
RESPONDENT PNB AGAINST THE RESPONDENTS-DEBTORS
ESLABONS, PETITIONERS SHALL SUCCEED TO ALL THE RIGHTS OF
RESPONDENT PNB WITH THE RIGHT TO REIMBURSEMENT BY
RESPONDENTS-DEBTORS ESLABONS.
VIII. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT
SHOULD PETITIONERS DECIDE NOT TO EXERCISE THEIR RIGHT OF
REDEMPTION, PETITIONERS SHALL BE ENTITLED TO THE VALUE OF
THEIR IMPROVEMENTS MADE IN GOOD FAITH AND FOR THE REAL
ESTATE TAX DUE PRIOR TO THE FORECLOSURE SALE.14
Petitioners challenge the appreciation of the facts of the appellate court, pointing out
the following facts which the appellate court allegedly failed to fully interpret and
appreciate:
1. That respondent PNB in its Answer admitted that Eduarda Belo was
merely an accommodation mortgagor and that she has no personal liability
to respondent PNB.
xxx xxx xxx
2. That the PNB Special Power of Attorney (SPA) Form No. 74 (Exh. "D")
used to bind Eduarda Belo as accommodation mortgagor authorized the
agent Eslabons to borrow and mortgage her agricultural land for her
(Eduarda Belo) use and benefit. Instead, said PNB SPA Form No. 74 was
used by debtors Eslabons and PNB to bind Eduarda Belo as
accommodation mortgagor for the crop loan extended by PNB to the
Eslabons.
3. That the said PNB SPA Form No. 74 was signed by Eduarda Belo
in blank, without specifying the amount of the loan to be granted by
respondent PNB to the respondents-debtors Eslabons upon assurance by
the PNB manager that the SPA was merely a formality and that the bank will
not lend beyond the value of the four (4) [Roxas City] residential lots located
in Roxas City mortgaged by respondents-debtors Eslabons (see Exhibit "D";
Eduarda Belo's deposition, Exhibit "V", pp. 7 to 24).
4. That PNB did not advise Eduarda Belo of the amount of the loan granted
to the Eslabons, did not make demands upon her for payment, did not
advise her of Eslabons' default. The pre-auction sale notice intended for
Eduarda Belo was addressed and delivered to the address of the debtors
Eslabons residence at Baybay Roxas City, not to the Belo Family House
which is the residence of Eduarda Belo located in the heart of Roxas City.
The trial court stated in its Decision that the PNB witness Miss Ignacio
"admitted that through oversight, no demand letters were sent to Eduarda
Belo, the accommodation mortgagor" (see p. 7, RTC Decision).
xxx xxx xxx
5. As an agreed fact stated in the Pre-Trial Order of the Regional Trial
Court, the loan which was unpaid at the time of the extrajudicial foreclosure
sale was only P789,897.00.
xxx xxx xxx
6. That herein petitioners Spouses Belo in making the tender to redeem
Eduarda Belo's agricultural land expressly reserved the right to question the
legality of the accommodation mortgage in the event that said tender to
redeem was rejected by PNB (Exh. "I").15
Petitioners present basically two (2) issues before this Court. First, whether or not the
Special Power of Attorney (SPA for brevity), the real estate mortgage contract, the
foreclosure proceedings and the subsequent auction sale involving Eduarda Belo's
property are valid. Second, assuming they are valid, whether or not the petitioners are
required to pay, as redemption price, the entire claim of respondent PNB in the
amount of P2,779,978.72 as of the date of the public auction sale on June 10, 1991.
On the first issue, the petitioners contend that the SPA is void for the reason that the
amount for which the spouses Eslabon are authorized to borrow from respondent
bank was unlimited; and that, while the SPA states that the amount loaned is for the
benefit of Eduarda Belo, it was in fact used for the benefit of the respondents spouses
Eslabon. For the said reasons petitioners contend that the mortgage contract lacks
valid consent, object and consideration; that it violates a concept in the law of agency
which provides that the contract entered into by the agent must always be for the
benefit of the principal; and, that it does not express the true intent of the parties.
The subject SPA, the real estate mortgage contract, the foreclosure proceedings and
the subsequent auction sale of Eduarda Belo's property are valid and legal.
First, the validity of the SPA and the mortgage contract cannot anymore be assailed
due to petitioners' failure to appeal the same after the trial court rendered its decision
affirming their validity. After the trial court rendered its decision granting petitioners
their alternative cause of action, i.e., that they can redeem the subject property on the
basis of the winning bid price of respondent PNB, petitioners did not anymore bother
to appeal that decision on their first cause of action. If they felt aggrieved by the trial
court's decision upholding the validity of the said two (2) documents, then they should
have also partially appealed therefrom but they did not. It is an abuse of legal
remedies for petitioners to belatedly pursue a claim that was settled with finality due to
their own shortcoming. As held in Caliguia v. National Labor Relations
Commission,16 where a party did not appeal from the Labor Arbiter's decision denying
claims for actual, moral and exemplary damages and instead moved for immediate
execution, the decision then became final as to him and by asking for its execution, he
was estopped from relitigating his claims for damages.
Second, well-entrenched is the rule that the findings of trial courts which are factual in
nature, especially when affirmed by the Court of Appeals, deserve to be respected
and affirmed by the Supreme Court, provided it is supported by substantial
evidence. 17 The finding of facts of the trial court to the effect that Eduarda Belo was
not induced by the manager of respondent PNB but instead that she freely consented
to the execution of the SPA is given the highest respect as it was affirmed by the
appellate court. In the case at bar, the burden of proof was on the petitioners to prove
or show that there was alleged inducement and misrepresentation by the manager of
respondent PNB and the spouses Eslabon. Their allegation that Eduarda Belo only
agreed to sign the SPA after she was assured that the spouses Eslabon would not
borrow more than the value of their own four (4) residential lots in Roxas City was
properly objected to by respondent PNB.18 Also their contention that Eduarda Belo
signed the SPA in blank was properly objected to by respondent PNB on the ground
that the best evidence was the SPA. There is also no proof to sustain petitioners'
allegation that respondent PNB acted in bad faith and connived with the debtors,
respondents spouses Eslabon, to obtain Eduarda Belo's consent to the mortgage
through fraud. Eduarda Belo very well knew that the respondents spouses Eslabon
would use her property as additional mortgage collateral for loans inasmuch as the
mortgage contract states that "the consideration of this mortgage is
hereby initially fixed at P229,000.00."19 The mortgage contract sufficiently apprises
Eduarda Belo that the respondents spouses Eslabon can apply for more loans with
her property as continuing additional security. If she found the said provision
questionable, she should have complained immediately. Instead, almost ten (10)
years had passed before she and the petitioners sought the annulment of the said
contracts.
Third, after having gone through the records, this Court finds that the courts a quo did
not err in holding that the SPA executed by Eduarda Belo in favor of the respondents
spouses Eslabon and the Real Estate Mortgage executed by the respondents
spouses in favor of respondent PNB are valid. It is stipulated in paragraph three (3) of
the SPA that Eduarda Belo appointed the Eslabon spouses "to make, sign, execute
and deliver any contract of mortgage or any other documents of whatever nature or
kind . . . which may be necessary or proper in connection with the loan herein
mentioned, or with any loan which my attorney-in-fact may contract personally in his
own name . . .20 This portion of the SPA is quite relevant to the case at bar. This was
the main reason why the SPA was executed in the first place inasmuch as Eduarda
Belo consented to have her land mortgaged for the benefit of the respondents
spouses Eslabon. The SPA was not meant to make her a co-obligor to the principal
contract of loan between respondent PNB, as lender, and the spouses Eslabon, as
borrowers. The accommodation real estate mortgage over her property, which was
executed in favor of respondent PNB by the respondents spouses Eslabon, in their
capacity as her attorneys-in-fact by virtue of her SPA, is merely an accessory contract.
Eduarda Belo consented to be an accommodation mortgagor in the sense that she
signed the SPA to authorize respondents spouses Eslabons to execute a mortgage on
her land. Petitioners themselves even acknowledged that the relation created by the
SPA and the mortgage contract was merely that of mortgagor-mortgagee relationship.
The SPA form of the PNB was utilized to authorize the spouses Eslabon to mortgage
Eduarda Belo's land as additional collateral of the Eslabon spouses' loan from
respondent PNB. Thus, the petitioners' contention that the SPA is void is untenable.
Besides, Eduarda Belo benefited, in signing the SPA, in the sense that she was able
to collect the rentals on her leased property from the Eslabons.21
An accommodation mortgage is not necessarily void simply because the
accommodation mortgagor did not benefit from the same. The validity of an
accommodation mortgage is allowed under Article 2085 of the New Civil Code which
provides that "(t)hird persons who are not parties to the principal obligation may
secure the latter by pledging or mortgaging their own property." An accommodation
mortgagor, ordinarily, is not himself a recipient of the loan, otherwise that would be
contrary to his designation as such. It is not always necessary that the
accommodation mortgagor be appraised beforehand of the entire amount of the loan
nor should it first be determined before the execution of the SPA for it has been held
that:
"(real) mortgages given to secure future advancements are valid and legal
contracts; that the amounts named as consideration in said contract do not
 limit the amount for which the mortgage may stand as security if from the amount due under the mortgage deed, as the case may be, with interest
four corners of the instrument the intent to secure future and other thereon at the rate specified in the mortgage, and all the costs, and judicial
indebtedness can be gathered. A mortgage given to secure advancements and other expenses incurred by the bank or institution concerned by reason
is a continuing security and is not discharged by repayment of the amount of the execution and sale and as a result of the custody of said property less
named in the mortgage, until the full amount of the advancements are the income received from the property.24
paid."22
On the other hand, petitioners assert that only the amount of the winning bidder's
Fourth, the courts a quo correctly held that the letter of Eduarda Belo addressed to purchase together with the interest thereon and on all other related expenses should
respondent PNB manifesting her intent to redeem the property is a waiver of her right be paid as redemption price in accordance with Section 6 of Act No. 3135 which
to question the validity of the SPA and the mortgage contract as well as the provides that:
foreclosure and the sale of her subject property. Petitioners claim that her letter was
not an offer to redeem as it was merely a declaration of her intention to redeem.
SECTION 6. In all cases in which an extrajudicial sale is made under the
Respondent PNB's answer to her letter would have carried certain legal effects. Had
special power hereinbefore referred to, the debtor, his successor in interest
respondent PNB accepted her letter-offer, it would have surely bound the bank into
or any judicial creditor or judgment creditor of said debtor, or any person
accepting the redemption price offered by Eduarda Belo. If it was her opinion that her
having a lien on the property subsequent to the mortgage or deed of trust
SPA and the mortgage contract were null and void, she would not have manifested
under which the property is sold, may redeem the same at any time within
her intent to redeem but instead questioned their validity before a court of justice. Her
the term of one year from and after the date of the sale; and such
offer was a recognition on her part that the said contracts are valid and produced legal
redemption shall be governed by the provisions of sections four hundred
effects. Inasmuch as Eduarda Belo is estopped from questioning the validity of the
and sixty-four to four hundred and sixty six, inclusive, of the Code of Civil
contracts, her assignees who are the petitioners in the instant case, are likewise
Procedure25 , in so far as these are not inconsistent with the provisions of
estopped from disputing the validity of her SPA, the accommodation real estate
this Act.
mortgage contract, the foreclosure proceedings, the auction sale and the Sheriff's
Certificate of Sale.
Section 28 of Rule 39 of the 1997 Revised Rules of Civil Procedure states that:
The second issue pertains to the applicable law on redemption to the case at bar.
Respondent PNB maintains that Section 25 of Presidential Decree No. 694 should SECTION 28. Time and manner of, and amounts payable on, successive
apply, thus: redemptions; notice to be given and filed. — The judgment obligor, or
redemptioner, may redeem the property from the purchaser, at any time
within one (1) year from the date of the registration of the certificate of
SECTION 25. Right of redemption of foreclosed property — Right of
sale, by paying the purchaser the amount of his purchase, within one per
possession during redemption period. — Within one year from the
centum per month interest thereon in addition, up to the time of redemption,
registration of the foreclosure sale of real estate, the mortgagor shall have
together with the amount of any assessments or taxes which the purchaser
the right to redeem the property by paying all claims of the Bank against him
may have paid thereon after purchase, and interest on such last named
on the date of the sale including all the costs and other expenses incurred
amount at the same rate; and if the purchaser be also a creditor having a
by reason of the foreclosure sale and custody of the property as well as
prior lien to that of the redemptioner, other than the judgment under which
charges and accrued interests.23
such purchase was made, the amount of such other lien, with interest. (Italic
supplied)
Additionally, respondent bank seeks the application to the case at bar of Section 78 of
the General Banking Act, as amended by P.D. No. 1828, which states that —
xxx xxx xxx

. . . In the event of foreclosure, whether judicially or extrajudicially, of any

mortgage on real estate which is security for any loan granted before the
passage of this Act or under the provisions of this Act, the mortgagor or
debtor whose real property has been sold at public auction, judicially or
extrajudicially, for the full or partial payment of an obligation to any bank,
banking or credit institution, within the purview of this Act shall have the
right, within one year after the sale of the real estate as a result of the
foreclosure of the respective mortgage, to redeem the property by
paying the amount fixed by the court in the order of execution, or the
This Court finds the petitioners' position on that issue to be meritorious.
There is no doubt that Eduarda Belo, assignor of the petitioners, is an accommodation
mortgagor. The Pre-trial Order and respondent PNB's brief contain a declaration of
this fact. The dispute between the parties is whether Section 25 of P.D. No. 694
applies to an accommodation mortgagor, or her assignees. The said legal provision
does not make a distinction between a debtor-mortgagor and an accommodation
mortgagor as it uses the broad term "mortgagor". The appellate court thus ruled that
the provision applies even to an accommodation mortgagor inasmuch as the law does
not make any distinction. We disagree. Where a word used in a statute has both a
restricted and a general meaning, the general must prevail over the restricted unless
the nature of the subject matter or the context in which it is employed clearly indicates
that the limited sense is intended.26 It is presumed that the legislature intended
exceptions to its language which would avoid absurd consequences of this
character.27 In the case at bar, the qualification to the general rule applies. The same
provision of Section 25 of P.D. No. 694 provides that "the mortgagor shall have the
right to redeem the property by paying all claims of the Bank against him". From said
provision can be deduced that the mortgagor referred to by that law is one from whom
the bank has a claim in the form of outstanding or unpaid loan; he is also called a
borrower or debtor-mortgagor. On the other hand, respondent PNB has no claim
against accommodation mortgagor Eduarda Belo inasmuch as she only mortgaged
her property to accommodate the Eslabon spouses who are the loan borrowers of the
PNB. The principal contract is the contract of loan between the Eslabon spouses, as
borrowers/debtors, and the PNB as lender. The accommodation real estate mortgage
(which secures the loan) is only an accessory contract. It is our view and we hold that
the term "mortgagor" in Section 25 of P.D. No. 694 pertains only to a debtor-
mortgagor and not to an accommodation mortgagor.
It is well settled that courts are not to give a statute a meaning that would lead to
absurdities. If the words of a statute are susceptible of more than one meaning, the
absurdity of the result of one construction is a strong argument against its adoption,
and in favor of such sensible interpretation.28 We test a law by its result. A law should
not be interpreted so as not to cause an injustice. There are laws which are generally
valid but may seem arbitrary when applied in a particular case because of its peculiar
circumstances. We are not bound to apply them in slavish obedience to their
language.29
The interpretation accorded by respondent PNB to Section 25 of P.D. No. 694 is unfair
and unjust to accommodation mortgagors and their assignees. Forcing an
accommodation mortgagor like Eduarda Belo to pay for what the principal debtors
(Eslabon spouses) owe to respondent bank is to punish her for the accommodation
and generosity she accorded to the Eslabon spouses who were then hard pressed for
additional collateral needed to secure their bank loan. Respondents PNB and spouses
Eslabons very well knew that she merely consented to be a mere accommodation
mortgagor.
The circumstances of the case at bar also provide for ample reason why petitioners
cannot be made to pay the entire liability of the principal debtors, Eslabon spouses, to
respondent PNB.
The trial court found that respondent PNB's application for extrajudicial foreclosure
and public auction sale of Eduarda Belo's mortgaged property30 was filed under Act
No. 3135, as amended by P.D. No. 385. The notice of extrajudicial sale, the Certificate
of Sheriff's Sale, and the letter it sent to Eduarda Belo did not mention P. D. No. 694
as the basis for redemption. As aptly ruled by the trial court —
In fairness to these mortgagors, their successors-in-interest, or innocent
purchasers for value of their redemption rights, PNB should have at least
advised them that redemption would be governed by its Revised Charter or
PD 69, and not by Act 3135 and the Rules of Court, as commonly practiced
. . . This practice of defendant Bank is manifestly unfair and unjust to these
redemptioners who are caught by surprise and usually taken aback by the
enormous claims of the Bank not shown in the Notice of Extrajudicial Sale
or the Certificate of Sheriff's Sale as in this case.31
Moreover, the mortgage contract explicitly provides that ". . . the mortgagee may
immediately foreclose this mortgage judicially in accordance with the Rules of Court or
extrajudicially in accordance with Act No. 3135, as amended and Presidential Decree
No. 385 . . .32 Since the mortgage contract in this case is in the nature of a contract of
adhesion as it was prepared solely by respondent, it has to be interpreted in favor of
petitioners. The respondent bank however tries to renege on this contractual
commitment by seeking refuge in the 1989 case of Sy v. Court of Appeals33 wherein
this Court ruled that the redemption price is equal to the total amount of indebtedness
to the bank's claim inasmuch as Section 78 of the General Banking Act is an
amendment to Section 6 of Act No. 3135, despite the fact that the extrajudicial
foreclosure procedure followed by the PNB was explicitly under or in accordance with
Act No. 3135.
In the 1996 case of China Banking Corporation v. Court of Appeals,34 where the
parties also stipulated that Act No. 3135 is the controlling law in case of foreclosure,
this Court ruled that;
By invoking the said Act, there is no doubt that it must "govern the manner
in which the sale and redemption shall be effected." Clearly, the
fundamental principle that contracts are respected as the law between the
contracting parties finds application in the present case, specially where
they are not contrary to law, morals, good customs and public policy.35
More importantly, the ruling pronounced in Sy v. Court of Appeals and other
cases,36 that the General Banking Act and P.D. No. 694 shall prevail over Act No.
3135 with respect to the redemption price, does not apply here inasmuch as in the
said cases the redemptioners were the debtors themselves or their assignees, and not
an accommodation mortgagor or the latter's assignees such as in the case at bar. In
the said cases, the debtor-mortgagors were required to pay as redemption price their
entire liability to the bank inasmuch as they were obligated to pay their loan which is a
principal obligation in the first place. On the other hand, accommodation mortgagors
as such are not in anyway liable for the payment of the loan or principal obligation of
the debtor/borrower The liability of the accommodation mortgagors extends only up to
the loan value of their mortgaged property and not to the entire loan itself. Hence, it is
only just that they be allowed to redeem their mortgaged property by paying only the
winning bid price thereof (plus interest thereon) at the public auction sale.
One wonders why respondent PNB invokes Act No. 3135 in its contracts without
qualification and yet in the end appears to disregard the same when it finds its
provisions unfavorable to it. This is unfair to the other contracting party who in good
faith believes that respondent PNB would comply with the contractual agreement.
It is therefore our view and we hold that Section 78 of the General Banking Act, as
amended by P.D. No. 1828, is inapplicable to accommodation mortgagors in the
redemption of their mortgaged properties.
While the petitioners, as assignees of Eduarda Belo, are not required to pay the entire
claim of respondent PNB against the principal debtors, spouses Eslabon, they can
only exercise their right of redemption with respect to the parcel of land belonging to
Eduarda Belo, the accommodation mortgagor. Thus, they have to pay the bid price
less the corresponding loan value of the foreclosed four (4) residential lots of the
spouses Eslabon.
The respondent PNB contends that to allow petitioners to redeem only the property
belonging to their assignor, Eduarda Belo, would violate the principle of indivisibility of
mortgage contracts. We disagree.
Article 2089 of the Civil Code of the Philippines, provides that:
A pledge or mortgage is indivisible, even though the debt may be divided
among the successors in interest of the debtor or of the creditor.
Therefore, the debtor's heir who has paid a part of the debt cannot ask for
the proportionate extinguishment of the pledge or mortgage as the debt is
not completely satisfied.
Neither can the creditor's heir who received his share of the debt return the
pledge or cancel the mortgage, to the prejudice of the other heirs who have
not been paid.
From these provisions is excepted the case in which, there being several
things given in mortgage or pledge, each one of them guarantees only a
determinate portion of the credit.
The debtor, in this case, shall have a right to the extinguishment of the
pledge or mortgage as the portion of the debt for which each thing is
specially answerable is satisfied.
There is no dispute that the mortgage on the four (4) parcels of land by the Eslabon
spouses and the other mortgage on the property of Eduarda Belo both secure the loan
obligation of respondents spouses Eslabon to respondent PNB. However, we are not
persuaded by the contention of the respondent PNB that the indivisibility concept
applies to the right of redemption of an accommodation mortgagor and her assignees.
The jurisprudence in Philippine National Bank v. Agudelo37 is enlightening to the case
at bar, to wit:
xxx xxx xxx
However, Paz Agudelo y Gonzaga (the principal) . . . gave her consent to
the lien on lot No. 878 . . . . This acknowledgment, however, does not
extend to lots Nos. 207 and 61 . . . inasmuch as, although it is true that a
mortgage is indivisible as to the contracting parties and as to their
successors in interest (Article 1860, Civil code), it is not so with respect to a
third person who did not take part in the constitution thereof either
personally or through an agent x x x. Therefore, the only liability of the
defendant-appellant Paz Agudelo y Gonzaga is that which arises from the
aforesaid acknowledgment but only with respect to the lien and not to the
principal obligation secured by the mortgage acknowledged by her to have
been constituted on said lot No. 878 . . . . Such liability is not direct but a
subsidiary one.38
xxx xxx xxx
Wherefore, it is hereby held that the liability contracted by the aforesaid
defendant-appellant Paz Agudelo y Gonzaga is merely subsidiary to that of
Mauro A. Garrucho (the agent), limited to lot No. 87.
xxx xxx xxx
From the wording of the law, indivisibility arises only when there is a debt, that is,
there is a debtor-creditor relationship. But, this relationship is wanting in the case at
bar in the sense that petitioners are assignees of an accommodation mortgagor and
not of a debtor-mortgagor. Hence, it is fair and logical to allow the petitioners to
redeem only the property belonging to their assignor, Eduarda Belo.
With respect to the four (4) parcels of residential land belonging to the Eslabon
spouses, petitioners — being total strangers to said lots — lack legal personality to
redeem the same. Fair play and justice demand that the respondent PNB's interest of
recovering its entire bank claim should not be at the expense of petitioners, as
assignees of Eduarda Belo, who is not indebted to it. Besides, the letter39 sent by
respondent PNB to Eduarda Belo states that "your (Belo) mortgaged property/ies with
PNB covered by TCT # T-7493 was/were sold at public auction . . . .". It further states
that "You (Belo) have, therefore, one year from July 1, 1991 within which to redeem
your mortgaged property/ies, should you desire to redeem it." Respondent PNB never
mentioned that she was bound to redeem the entire mortgaged properties including
the four (4) residential properties of the spouses Eslabon. The letter was explicit in
mentioning Eduarda Belo's property only. From the said statement, there is then an
admission on the part of respondent PNB that redemption only extends to the subject
property of Eduarda Belo for the reason that the notice of the sale limited the
redemption to said property.
WHEREFORE, the petition is partially granted in that the petitioners are hereby
allowed to redeem only the property, covered and described in Transfer Certificate of
Title No. T-7493-Capiz registered in the name of Eduarda Belo, by paying only the bid
price less the corresponding loan value of the foreclosed four (4) residential lots of the
respondents spouses Marcos and Arsenia Eslabon, consistent with the Decision of the
Regional Trial Court of Roxas City in Civil Case No. V-6182.

SO ORDERED.

Bellosillo, Mendoza, Quisumbing and Buena, JJ ., concur.

G.R. No. L-2503 December 10, 1948
CRESENCIO RUBEN TOLENTINO, petitioner-appellant,
vs.
CESARIO CATOY, Provincial Warden, Batangas, Batangas, respondent-appellee.
Ramon Diokno and Jose W. Diokno for petitioner-appellant.
Office of the Solicitor General Felix Bautista Angelo, First Assistant Solicitor General
Roberto A. Gianzon, Solicitor Jose G. Bautista, and Assistant Provincial Fiscal
Geminiano G. Beloso for respondent-appellee.
TUASON, J.:
This is an appeal from a decision denying an application for the writ of habeas corpus.
Petitioner was a Hukbalahap and was found by the Court of First Instance of Batangas
guilty of the crime of illegal assembly held in furtherance of the Hukbalahap designs.
The judgment was promulgated on May 11, 1948.
On June 21, the President issued Proclamation No. 76 granting amnesty under certain
conditions to leaders and members of the Hukbalahap and the PKM organizations. On
July 16, within the 20-day period for surrender imposed as a condition by the amnesty,
the petitioner, already serving sentence, sent the President a petition for his release
under the provisions of the proclamation. No action was taken on this petition and the
petitioner came to court with the present application.
Judge Juan Enriquez, who heard and decided the petition in the court below, was of
the opinion that "the petitioner is clearly covered by the amnesty proclamation" but
refused to grant the writ because "he (petitioner) has failed to follow the procedure
outlined by the implementing circulars (of the Secretary of Justice) so that he may
avail of the benefits thereof." He called attention to the fact that circular No. 27-A
"vests the release of such prisoners on the Committee on the Implementation of the
Amnesty Proclamation No. 76 in Manila, instead of the President." He gives to
understand that only this committee is authorized to order the discharge of convicted
Hukbalahaps under the proclamation.
If the petitioner is entitled to the benefits of this proclamation and he is unable to
obtain his release through executive channels, it devolves on the courts to protect his
rights. This is a fundamental right which cannot be left to the decision of executive
officers. This should be especially true where, as an in this case, the implementation
committee was not the creation of the proclamation nor was it even mentioned in this
document. The committee was appointed by the Secretary of Justice as an
instrumentality to facilitate, not to hinder or obstruct, the carrying out of the provisions
of the amnesty.
Let it be said that the Solicitor General does not seem to agree with the lower court's
theory, having passed it up. The law officer of the Government bases his opposition to
the petition under consideration on a different ground — that the petitioner did not
present any arm. He thus raises only a question of fact, and fact was the only question
which the respondent argued at the hearings before this Court.
There is attached to the record of the Court of First Instance a certificate drawn in the
form prescribed in the Secretary of Justice's circulars and signed by the Commanding
Officer of the Constabulary in Batangas, stating that on July 10, petitioner presented
himself with a Remington .45 caliber pistol and ammunition. The Provincial Fiscal who
appeared with Solicitor Bautista of the Solicitor General's office admitted the
authenticity of the Constabulary Commanding Officer's and the petitioner's signatures
affixed to the certificate. In impugning this paper, he said it was not seen by him when
the case was tried and submitted in the lower court. He also said that the firearms
mentioned in the certificate belonged to another man and had been surrendered by
the latter.
That the fiscal did not see the certificate is no authority for the allegation that it was not
there. It is to be kept in mind that no oral evidence was introduced, the case having
been submitted for decision on the pleadings and their annexes. Judge Enriquez's
opinion that the petitioner comes within the terms of the proclamation tends to suggest
that the petitioner had fulfilled all its conditions, including the presentation of firearms
and ammunition. His Honor's emphasis on the need of strict compliance with the
Secretary of Justice's circular, taken in connection with his opinion, gives added
ground for supposing that an arm and ammunition were turned in.
The provincial fiscal's insinuation that the gun was surrendered by another
Hukbalahap has nothing to support it than his belief. Belief, suspicion and conjectures
can not overcome the presumption of regularity and legality which attaches to the
certificate in question. But granting the truth of the fiscal's statement, it nevertheless
may be that the petitioner, who was an officer in the Hukbalahap organization, was the
true and real owner of the weapon and not the man who previously surrendered it.
This is not saying that surrender of firearms was a necessary requirement to stay the
effects of the proclamation. It is not necessary to decide this question, and we do not
attempt to do so.
Some members of the Court question the applicability of Amnesty Proclamation No.
76 to Hukbalahap already undergoing sentence upon the date of its promulgation. The
Secretary of Justice's implementing circulars are predicated on the assumption that
the proclamation is all-inclusive. As a contemporary construction, this opinion of the
Secretary of Justice ought to carry much weight, considering that, as the department
head who advised the Chief Executive and in whose department the proclamation was
drawn, he is in a position to be informed of its scope and meaning.
Quite apart from this consideration, the majority of the Court believe that by its context
and pervading spirit the proclamation extends to all members of the Hukbalahap and
PKM organizations. It makes no exception when it announces that the amnesty is
proclaimed "in favor of the leaders and members of the association known as
Hukbalahap and Pambansang Kaisahan ng Magbubukid." No compelling reason is
apparent for excluding Hukbalahaps of any class or condition from its object, which is
"to forgive, and forego the prosecution of the crimes of rebellion, sedition, etc.," as a
"just and wise measure of the Government." We are to suppose that the President and
the Congress, knowing that a good number of Hukbalahap and PKM affiliates had
been or were being prosecuted, would have, in clear terms, left them out if that had
been the intention, instead of leaving their exclusion to inference.
willingness to abide by the conditions of the grant. It is not intended as, and can not
accomplish the purpose of, a security. As evidence of good faith, surrender by
Hukbalahaps from the field is not more effective than a prisoner's written and more
solemn manifestation of his acceptance. If physical presence be deemed essential,
prisoners not only present themselves but are under the custody of the authorities
subject to their absolute control until released.
The writ will be granted and the petitioner discharged from confinement immediately
without costs. It is so ordered.

As a matter of fact, we can discover neither advantage nor desirableness that could
Moran, C.J., Paras, Pablo, Perfecto and Briones, JJ., concur.
have induced the President and the Congress to adopt a policy of condoning the
Feria, Bengzon and Montemayor, JJ., concur in the result.
offense of Hukbalahaps who persisted in their defiance of the Government and not the
crime of those who had already tasted the bitter pill of retribution for their
transgression. That runs counter to the spirit of generosity and magnanimity which
inspired Proclamation No. 76. It is not in keeping with the proclamation's concept that
forgiveness is more expedient for the Government and the public welfare than
punishment. If total punishment is foregone in favor of Hukbalahaps who succeeded in
evading arrest, it stands to reason that those who fell into the clutches of the law have
better claim to clemency for the remaining portion of a punishment fixed for the same
offense.

The avowed practical objective of the amnesty is to secure pledge of loyalty and
obedience to the constituted authorities and encourage resumption of lawful pursuits
and occupation. This objective can not be expected to meet with full success without
the goodwill and cooperation of the Hukbalahaps who have become more embittered
by their capture, prosecution and incarceration. It was known that those dissidents
who had been arrested and prosecuted were not going to remain in jail forever, and
that discrimination against them might in itself be a driving force for them and their
sympathizers to take up arm again.

We pursue the above line of reasoning as a means of determining the grantor's

intention, not as a means of enlarging the proclamation's meaning. We test an
interpretation by its results.

Fundamentally and in their utmost effect, pardon and amnesty are synonymous. Mr.
Justice Field in Knote vs. United States, 24 Law. ed., 442, 443, said that "the
distinction between them is one rather of philological interest than of legal
importance." It seems to be generally conceded in the United States that the word
"'pardon' includes amnesty." (State vs. Eby, 71 S. W., 61.) This being so, the rules for
interpreting pardon and amnesty ought not to vary. Now then, according to a well-
recognized doctrine, pardon is construed "most strictly against the state." "Where
general words are used, their natural meaning is not to be restricted by other words
unless the intention to do so is clear and manifest." (46 C. J., 1192.)lawphil.net

At best, the contention that the grace and beneficence of the amnesty are denied the
Hukbalahaps who were in prison rests on the idea that being restrained of liberty they
can not surrender. Our answer is that surrender is required merely as a token of
G.R. No. L-30761 July 11, 1973
THE SAN MIGUEL CORPORATION, petitioner,
vs.
THE MUNICIPAL COUNCIL, THE MAYOR, and THE MUNICIPAL TREASURER OF
THE MUNICIPALITY OF MANDAUE, PROVINCE OF CEBU, respondents.
Gadioma and Josue for petitioner.
Acting City Fiscal Lawrence A. Parawan for respondents.
ANTONIO, J.:
Petition for writ of certiorari to review the judgment of the Court of First Instance of
Cebu, in Civil Case No. R-10631, upholding the validity of Ordinance No. 23, series of
1966, as amended by Ordinance No. 25, series of 1967, of the Municipality of
Mandaue, Cebu, imposing "a graduated quarterly fixed tax based on the gross value
of money or actual market value at the time of removal of the manufactured articles
from their factories or other manufacture or processing establishments."
In enacting the said ordinances, the municipal council of Mandaue invoked as basis of
its authority Republic Act No. 2264 (Local Autonomy Act).
The relevant portion of Section 1, Ordinance No. 23 (1966), as amended by
Ordinance No. 25 (1967), provides as follows:
SECTION 1. — Municipal License Tax On Proprietors Or
Operators Of ... Breweries, ... Proprietors or operators of ...
breweries, ... within the territorial limits of this municipality shall
pay a graduated quarterly fixed tax based on the gross value in
money or actual market value at the time of removal, of the
manufactured articles from their factories ... during the preceding
quarter in accordance with the following schedules: ...:
CLASS QUARTERLY LICENSE TAX
P160.00 and P0.30 for
QUARTERLY GROSS VALUE each P1,000.00 or
fraction thereof in excess
1 P37,500.00 or over of P37,500.00 gross value.
2 P31.250.00 to P37,499.99 P158.00 per quarter
3 25,000.00 to 31,249.99 132.00 " "
4 20,000.00 to 24,999.99 105.00 " "
5 15.000.00 to 19,999.99 83.00 " "
6 12.500.00 to 14,999.99 63.00 " "
7 10,000.00 to 12,499.99 50.00 " "
8 8,750.00 to 9,999.99 42.00 " "
9 7,500.00 to 8,749.99 37.00 " "
10 6,500.00 to 7,499.99 31.00 " "
11 5,500.00 to 6,499.99 27.00 " "
12 4,500.00 to 5,499.99 23.00 " "
13 3,750.00 to 4,499.99 19.00 " "
14 3,000.00 to 3,749.99 16.00 " "
15 2,500.00 to 2,999.99 13.00 " "
16 2,000.00 to 2,499.99 11.00 " "
17 1,750.00 to 1,999.99 9.00 " "
18 1,500.00 to 1,749.99 8.00 " "
19 1,250.00 to 1,499.99 7.00 " "
20 Less than P1,250.00 5.00 " "
The pertinent portion of Section 2 of Ordinance No. 23 which was not amended by
Ordinance No. 25 states:
Payment of Municipal License Tax. — A fixed tax imposed on this
ordinance must first be paid before any person can engage in
business and is payable for each taxable business; ...
The graduated fixed tax provided in this ordinance shall be paid at
the Office of the Municipal Treasurer quarterly, on or before the
twentieth of January, April, July and October; ... . Provided further,
That as regards businesses already operating at the time this
ordinance takes effect, the tax for the initial quarter shall be paid
pursuant to the provisions of this ordinance and shall be based on
the gross value in money during the quarter immediately
preceding, ... .
Within the time fixed for the payment of the license taxes herein
imposed, the taxpayers shall prepare and file with the Municipal
Treasurer, a sworn statement of the gross value in money during
the preceding quarter on the basis of which the tax shall be
assessed and collected. ... .
The basic Ordinance was No. 88,1 which took effect on September 25, 1962, but this
was amended by Ordinance No. 23 (January 1, 1967), and by Ordinance No. 25
(January 1, 1968).
Petitioner, a domestic corporation engaged in the business of manufacturing beer and
other products with a subsidiary manufacturing plant in Mandaue, Cebu, since
December, 1967, paid the taxes prescribed in the aforesaid ordinance, protest thus:
P309.40 on January 22, 1968 and P5,171.80 as of July 18, 1968, computed
respectively "on the basis of 70,412 and 2,203.070 cases of beer manufactured and
removed from said Mandaue plant, multiplied by P7.60 which is the prevailing market
price (wholesaler's price) per case of beer at the time of the removal".
Claiming that it is adversely affected by the ordinance, which in its view was beyond
the power and authority of the municipality to enact, petitioner brought and action in
the Court of First Instance of Cebu, Branch VI, for the annulment of said ordinance.
Petitioner contends that (1) the phrase "gross value in money or actual market value"
employed in the questioned ordinance clearly referred to "sales or market price" of the
articles or commodities manufactured thereby indicating a manifest intent to impose a
tax based on sales, and (2) that to impose a tax upon the privilege of manufacturing
beer, when the amount of the tax is measured by the gross receipts from its sales of
beer, is the same as imposing a tax upon the product itself.
Respondents upon the other hand insist that the tax imposed in the questioned
ordinance (1) is not a percentage tax or a tax on the sales of beer but is a tax on the
privilege to engage in the business of manufacturing beer, and the phrase "actual
market value" was merely employed as a basis for the classification and graduation of
the tax sought to be imposed; (2) that it is not a specific tax because it is not a tax on
the beer itself, but on the privilege of manufacturing beer; and (3) that with conversion
of Mandaue into a city on June 21, 1969, the appeal has become moot, because the
prohibition against the imposition of any privilege tax on sales or other taxes in any
form based thereon, is applicable only to municipalities.
While We have heretofore announced the doctrine that the grant of power to tax to
charterred cities and municipalities under Section 2 of the Local Autonomy Act is
sufficiently plenary,2 it is, however, subject to the exceptions and limitations contained
in the two (2) provisos of the same statute. In other words, the municipal corporation
should not transcend the limitations imposed by the statute on the basis of which the
power to tax is sought to be exercised. Thus, We held in the Marinduque case, 3 that
an ordinance providing for a graduated tax based on either "gross output or sales"
violates the prohibition on municipalities against imposing any percentage tax on
sales, or other taxes in any form based thereon, as the only standard provided for
measuring the gross output is its peso value, as determined from true copies of
receipts and/or invoices that the taxpayer is required to submit to the municipal
treasurer.
We are thus confined to the narrow issue of whether or not the challenged ordinance
has transcended the exceptions and limitations imposed by section 2 of Republic Act
2264.
Section 2 of the aforecited statute provides:
Provided, That municipalities and municipal districts shall, in no
case, impose any percentage tax on sales or other taxes in any
form based thereon nor impose taxes on articles subject to
specific tax ... .
Section 1 of Ordinance No. 88 of the Municipality of Mandaue, as amended by
Ordinances Nos. 23 (1967) and 25 (1968), specifically provides that the graduated
quarterly tax shall be "based on the gross value in money or actual market value at
the time of removal, of the manufactured products ... from their factories ... during the
preceding calendar year ... .
Well settled is the rule that in the absence of legislative intent to the contrary, technical
or commercial terms and phrases, when used in tax statutes, are presumed to have
been used in their technical sense or in their trade or commercial meaning. Thus, the
phrase "gross value in money" has a well-defined meaning in our tax statutes. For
instance, the term "gross value in money" of articles sold, bartered, exchanged or
transferred, as used in Sections 184, 185 and 186 of the National Internal Revenue
Code, has been invariably used as equivalent to "gross selling price" and has been
construed as the total amount of money or its equivalent which the purchaser pays to
the vendor to receive or get the goods.4 It must be noted that the ordinance
specifically provides that the basis of the tax is the "gross value in money or actual
market value" of the manufactured article.
The phrase "actual market value" has been construed as the price which an article
"would command in the ordinary course of business, that is to say, when offered for
sale by one willing to sell, but not under compulsion to sell, and purchased by another
who is willing to buy, but under no obligation purchase it,5 or the price which the
property will bring in a fair market after fair and reasonable efforts have been made to
find a purchaser who will give the highest price for it. 6 The "actual market value" of
property, for purposes of taxation, therefore means the selling price of the article in the
course of ordinary business.
Considering that the phrase "gross value in money" is followed by the words "or actual
market value", it is evident that the latter was intended to explain and clarify the
preceding phrase. For the word "or" may be used as the equivalent of "that is to say"
and gives that which precedes it the same significance as that which follows it. It is not
always disjunctive and is sometimes interpretative or expository of the preceding
word.7 Certainly We cannot assume that the phrase "or actual market value" was a
mere surplusage, for it serves to clarify and explain the meaning and import of the
preceding phrase. In any event, it is the duty of the courts, so far reasonably
practicable, to read and interpret a statute as to give life and effect to its provisions, so
as to render it a harmonious whole.
It is also significant to note, that there is a set ratio between the amount of the tax and
the volume of sales. Thus if the "gross value in money or actual market value" of the
beer removed from the factory exceeds P37,500.00 per quarter, the taxpayer is
required to pay a quarterly license tax of P160.00 plus P0.30 for every P1,000.00 or
fraction of the excess. In other words in excess of P37,500.00, the taxpayer will pay to
the municipality a certain amount of tax measured by a percentage of the sales. It is
therefore evident that the challenged ordinance was a transparent attempt on the part curative effect upon the ordinances of the municipality which when enacted were
of the municipality to impose a tax based on sales. beyond its statutory authority.

Although section 2 of the ordinance in question provides in a vague manner that the
tax shall be assessed and collected on the basis of the sworn statement of the
manager of a firm or corporation "of the gross value in money during the preceding
quarter," in actual practice the quarterly tax levied upon the petitioner, was computed
on the basis of the total market of the beer, per quarter, as shown by the shipping
memorandum certified to by the storekeeper of the Bureau Internal Revenue assigned
to the brewery. Thus the amounting to P309.40 and P5,171.80, paid by petition
January 22, 1968 and July 18, 1968, were actually determined respectively on the
basis of 70,412 and 2,203.070 cases manufactured and removed from the Mandaue
plant, multiplied by P7.60 which is the prevailing market price (wholesaler's price) per
case of beer.
IN VIEW WHEREOF, the appealed judgment is hereby reversed and Ordinance No.
23, series of 1966, as amended by Ordinance No. 23, series of 1966, which became
effective January 1, 1968, of the Municipality of Mandaue, Cebu, is hereby declared
null and void. Respondents are also ordered to refund the taxes paid by Petitioners
under the said ordinance, with legal interest thereon. No costs.
Makalintal, Actg. C.J., Zaldivar, Castro, Teehankee Makasiar and Esguerra, JJ.,
concur.
Fernando and Barredo, JJ., took no part.

In Laoag Producers' Cooperative Marketing Association, Inc. vs. Municipality of

Laoag,8 We held that the challenged ordinance imposed a tax based on sales,
although the ordinance merely imposed a "municipal tax or inspection fee of on one-
half (1/2) centavo on every kilo of Virginia leaf tobacco, garlic and onion on all
wholesale dealers and vendors" because, in its application, it does impose a tax
based on sales, as it is based the number of kilos sold and purchased by him and
when the wholesaler or vendor accumulates his stock, he does so for only one
purpose, to sell the same at the appropriate time, and "he cannot by its very nature,
carry on his business unless he sells what he has bought." Similarly, in the case at
bar, the circumstance that the tax is imposed upon petitioner at time of removal from
the factory of the manufactured beer, and not on the date of actual sale, is not of
important consequence since petitioner will, in the end, sell the beer removed from the
factory, because by the nature of its business, it has no alternative but to sell what it
has manufactured.

We therefore hold that the questioned ordinance imposed tax based on sales and
therefore beyond the authority of the municipality to enact.

Having reached this conclusion, it becomes unnecessary to pass upon the additional
question posed, i.e., whether or not the challenged ordinance imposes a tax on a
product subject to specific tax.

Respondents however claim that with the conversion Mandaue into a city pursuant to
Republic Act No. 5519, which was approved on June 21, 1969, the issue has already
become moot, since the prohibition contained in section 2 of Republic Act 2264
applies only to municipalities and not to chartered cities. The same contention has
been rejected in City of Naga v. Court of Appeals,9 and Laoag Producers' Cooperative
Marketing Association, Inc. v. Municipality of Laoag, supra, where We ruled that the
legality of an ordinance depends upon the power of the municipality at the time of the
enactment the challenged ordinance. Since the municipality of Mandaue had no
authority to enact the said ordinance, the subsequent approval of Republic Act No.
5519 which became effective June 21, 1969, did not remove the original infirmity of
the ordinance. Indeed there is no provision in the aforecited statute which invests a
G.R. No. L-12687 August 27, 1918
THE ASIATIC PETROLEUM COMPANY (LTD.), plaintiff-appellant,
vs.
THE INSULAR COLLECTOR OF INTERNAL REVENUE, defendant-appellant.
Crossfield and O'Brien for plaintiff.
Acting Attorney-General Paredes for defendant.
JOHNSON, J.:
For the reason that the facts were analogous, this case was heard and decided with
cause No. 13400 [of the Court of First Instance of Manila], entitled "The Asiatic
Petroleum Company (Ltd.) vs. The Collector of Customs and The Collector of Internal
Revenue."
The only question presented by this appeal is whether or not a dealer is required to
pay the internal revenue tax, provided for under section 17, (paragraph 72a) of Act No.
2342, upon mineral oils, but not delivered, prior to the first day of January, 1915.
The facts in this case are not in dispute. They are:
The defendant, under threat of penalty, compelled the plaintiff to pay the internal
revenue tax provided for under above said section of Act No. 2432 upon all such oils
which the plaintiff had on hand on the first day of January, 1915, whether or not the
same had been sold theretofore or not. The tax was paid under protest.
The plaintiff contends that the tax collected was illegal, for the reason that the law had
expressly relieved him from the necessity of paying the same on all such oils which he
had "disposed of to consumers or persons other then manufacturers or wholesale
dealers, prior to January 1, 1915"; that inasmuch as he had made a valid and legal
sale of such oils before January 1, 1915 even though the same had not been actually
delivered they had been "disposed of" and he was therefore relieved from the
necessity of paying the tax imposed by said Act. No contention is made that the oils
"disposed of" had been disposed of to "manufacturers or wholesale dealers."
Section 17 (paragraph 72a) of Act No. 2432, among other things, provides that "no tax
(imposed by law) shall be collected on such articles have been disposed of to
consumers or persons other than manufacturers or wholesale dealers. Said Act took
effect upon the first day of January, 1915.
Considering the provisions of said quoted section, it is clear that the plaintiff could not
be compelled to pay the tax imposed by said Act upon mineral oils which had
been disposed of to consumers or persons, etc., prior to the first day of January, 1915.
That being true, the question is presented; Were the oils in question which plaintiff had
sold, but which he had not delivered, prior to the first day of January, 1915, disposed
of, so as to relieve him from the necessity of paying tax? No question is raised as to
oils sold and delivered prior to January 1, 1915.
This question involves an interpretation of the phrase "disposed of" as used in the said
section. If, it means that the vendor must "sell and deliver," then the oils in question
were not "disposed of." If, upon the other hand, the phrase means simply that the
vendor has "sold," then the oils in question simply that the vendor has "sold," then the
oils in question were "disposed of." If the Legislature had intended that the phrase
"dispose of" meant "sold and delivered," it is strange that it did not use the latter
phrase. The Legislature evidently took into consideration the custom of merchants in
their use of the phrase "dispose of." That phrase is used in the law evidently in its
commercial sense and not in a technical sense. Words and phrases, which are in
common use among merchants and are found in a law, should not be given a new and
strange interpretation, but should be given that meaning which generally is given and
accepted, in the community where the law applies and where the word or phrase has
been in common use.
If A should step into the store of B and say to B that he desired to purchase 5 sacks of
rice, and should then and there pay for the same, even though they were not then and
there delivered, B would be perfectly justified, in taking an inventory of his business, in
noting that the 5 sacks of rice had been "disposed of." We believe that this is the
signification which the Legislature intended to give the phrase. Of course, subsequent
events, or change of circumstances might alter the situation and give rise to other
questions relating to the rice.
Merchandise may be "disposed of" even though the price has not been paid nor the
same delivered. A sale may be perfected between vendor and vendee and may be
binding on both of them, if they have agreed upon the thing, the object of the contract
and the price, even though the price had not been paid nor the merchandise delivered.
(Art. 1450, Civil Code.)
The Legislature, by Act No. 2445, fully recognized that the phrase "disposed of" meant
nothing more or less than a contract whereby the vendor was bound to furnish an
article, because in said Act (No. 2445) it provided that "whenever any person has prior
to the enactment of this law (2432) entered into a contract whereby he has bound
himself to furnish to another an article subject to the tax or increased rate of tax . . .,"
the purchaser, and not the vendor, was subject to pay such tax in the absence of
stipulations to the contrary.
We are of opinion that the plaintiff had "disposed of" the mineral oils in question before
the first day of January, 1915, and was therefore relieved from the necessity of paying
the internal revenue tax imposed by the defendant.
Therefore, it is hereby ordered and decreed that the judgment of the lower court
should be and is hereby affirmed, with costs. Let a judgment be entered in accordance
herewith. So ordered.
G.R. No. L-630 November 15, 1947
ALEXANDER A. KRIVENKO, petitioner-appellant,
vs.
THE REGISTER OF DEEDS, CITY OF MANILA, respondent and appellee.
Gibbs, Gibbs, Chuidian and Quasha of petitioner-appellant.
First Assistant Solicitor General Reyes and Solicitor Carreon for respondent-appellee.
Marcelino Lontok appeared as amicus curies.
MORAN, C.J.:
Alenxander A. Kriventor alien, bought a residential lot from the Magdalena Estate,
Inc., in December of 1941, the registration of which was interrupted by the war. In
May, 1945, he sought to accomplish said registration but was denied by the register of
deeds of Manila on the ground that, being an alien, he cannot acquire land in this
jurisdiction. Krivenko then brought the case to the fourth branch of the Court of First
Instance of Manila by means of a consulta, and that court rendered judgment
sustaining the refusal of the register of deeds, from which Krivenko appealed to this
Court.
There is no dispute as to these facts. The real point in issue is whether or not an alien
under our Constitution may acquire residential land.
It is said that the decision of the case on the merits is unnecessary, there being a
motion to withdraw the appeal which should have been granted outright, and
reference is made to the ruling laid down by this Court in another case to the effect
that a court should not pass upon a constitutional question if its judgment may be
made to rest upon other grounds. There is, we believe, a confusion of ideas in this
reasoning. It cannot be denied that the constitutional question is unavoidable if we
choose to decide this case upon the merits. Our judgment cannot to be made to rest
upon other grounds if we have to render any judgment at all. And we cannot avoid our
judgment simply because we have to avoid a constitutional question. We cannot, for
instance, grant the motion withdrawing the appeal only because we wish to evade the
constitutional; issue. Whether the motion should be, or should not be, granted, is a
question involving different considerations now to be stated.
According to Rule 52, section 4, of the Rules of Court, it is discretionary upon this
Court to grant a withdrawal of appeal after the briefs have been presented. At the time
the motion for withdrawal was filed in this case, not only had the briefs been
prensented, but the case had already been voted and the majority decision was being
prepared. The motion for withdrawal stated no reason whatsoever, and the Solicitor
General was agreeable to it. While the motion was pending in this Court, came the
new circular of the Department of Justice, instructing all register of deeds to accept for
registration all transfers of residential lots to aliens. The herein respondent-appellee
was naturally one of the registers of deeds to obey the new circular, as against his
own stand in this case which had been maintained by the trial court and firmly
defended in this Court by the Solicitor General. If we grant the withdrawal, the the
result would be that petitioner-appellant Alexander A. Krivenko wins his case, not by a
decision of this Court, but by the decision or circular of the Department of Justice,
issued while this case was pending before this Court. Whether or not this is the reason
why appellant seeks the withdrawal of his appeal and why the Solicitor General readily
agrees to that withdrawal, is now immaterial. What is material and indeed very
important, is whether or not we should allow interference with the regular and
complete exercise by this Court of its constitutional functions, and whether or not after
having held long deliberations and after having reached a clear and positive conviction
as to what the constitutional mandate is, we may still allow our conviction to be
silenced, and the constitutional mandate to be ignored or misconceived, with all the
harmful consequences that might be brought upon the national patromony. For it is but
natural that the new circular be taken full advantage of by many, with the circumstance
that perhaps the constitutional question may never come up again before this court,
because both vendors and vendees will have no interest but to uphold the validity of
their transactions, and very unlikely will the register of deeds venture to disobey the
orders of their superior. Thus, the possibility for this court to voice its conviction in a
future case may be remote, with the result that our indifference of today might signify a
permanent offense to the Constitution.
All thse circumstances were thoroughly considered and weighted by this Court for a
number of days and the legal result of the last vote was a denial of the motion
withdrawing the appeal. We are thus confronted, at this stage of the proceedings, with
our duty, the constitutional question becomes unavoidable. We shall then proceed to
decide that question.
Article XIII, section 1, of the Constitutional is as follows:
Article XIII. — Conservation and utilization of natural resources.
SECTION 1. All agricultural, timber, and mineral lands of the public domain,
water, minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, and other natural resources of the Philippines belong to
the State, and their disposition, exploitation, development, or utilization shall
be limited to citizens of the Philippines, or to corporations or associations at
least sixty per centum of the capital of which is owned by such citizens,
subject to any existing right, grant, lease, or concession at the time of the
inaguration of the Government established uunder this Constitution. Natural
resources, with the exception of public agricultural land, shall not be
alienated, and no licence, concession, or lease for the exploitation,
development, or utilization of any of the natural resources shall be granted
for a period exceeding twenty-five years, renewable for another twenty-five
years, except as to water rights for irrigation, water supply, fisheries, or
industrial uses other than the development of water "power" in which cases
beneficial use may be the measure and the limit of the grant.
The scope of this constitutional provision, according to its heading and its language,
embraces all lands of any kind of the public domain, its purpose being to establish a
permanent and fundamental policy for the conservation and utilization of all natural have used such expressions in accordance with their technical meaning. (11
resources of the Nation. When, therefore, this provision, with reference to lands of the Am. Jur., sec. 66, p. 683.) Also Calder vs. Bull, 3 Dall. [U.S.], 386; 1 Law.
public domain, makes mention of only agricultural, timber and mineral lands, it means ed., 648; Bronson vs. Syverson, 88 Wash., 264; 152 P., 1039.)
that all lands of the public domain are classified into said three groups, namely,
agricultural, timber and mineral. And this classification finds corroboration in the
It is a fundamental rule that, in construing constitutions, terms employed
circumstance that at the time of the adoption of the Constitution, that was the basic
therein shall be given the meaning which had been put upon them, and
classification existing in the public laws and judicial decisions in the Philippines, and
which they possessed, at the time of the framing and adoption of the
the term "public agricultural lands" under said classification had then acquired a
instrument. If a word has acquired a fixed, technical meaning in legal and
technical meaning that was well-known to the members of the Constitutional
constitutional history, it will be presumed to have been employed in that
Convention who were mostly members of the legal profession.
sense in a written Constitution. (McKinney vs. Barker, 180 Ky., 526; 203
S.W., 303; L.R.A., 1918 E, 581.)
As early as 1908, in the case of Mapa vs. Insular Government (10 Phil., 175, 182), this
Court said that the phrase "agricultural public lands" as defined in the Act of Congress
Where words have been long used in a technical sense and have been
of July 1, 1902, which phrase is also to be found in several sections of the Public Land
judicially construed to have a certain meaning, and have been adopted by
Act (No. 926), means "those public lands acquired from Spain which are neither
the legislature as having a certain meaning prior to a particular statute in
mineral for timber lands." This definition has been followed in long line of decisions of
which they are used, the rule of construction requires that the words used in
this Court. (See Montano vs. Insular Government, 12 Phil., 593; Ibañez de Aldecoa vs.
such statute should be construed according to the sense in which they have
Insular Government, 13 Phil., 159; Ramos vs. Director of Lands, 39 Phil., 175;
been so previously used, although the sense may vary from strict literal
Jocson vs. Director of Forestry, 39 Phil., 560; Ankron vs. Government of the
meaning of the words. (II Sutherland, Statutory Construction, p. 758.)
Philippines, 40 Phil., 10.) And with respect to residential lands, it has been held that
since they are neither mineral nor timber lands, of necessity they must be classified as
agricultural. In Ibañez de Aldecoa vs. Insular Government (13 Phil., 159, 163), this Therefore, the phrase "public agricultural lands" appearing in section 1 of Article XIII of
Court said: the Constitution must be construed as including residential lands, and this is in
conformity with a legislative interpretation given after the adoption of the Constitution.
Well known is the rule that "where the Legislature has revised a statute after a
Hence, any parcel of land or building lot is susceptible of cultivation, and
Constitution has been adopted, such a revision is to be regarded as a legislative
may be converted into a field, and planted with all kinds of vegetation; for
construction that the statute so revised conforms to the Constitution." (59 C.J., 1102.)
this reason, where land is not mining or forestal in its nature, it must
Soon after the Constitution was adopted, the National Assembly revised the Public
necessarily be included within the classification of agricultural land, not
Land Law and passed Commonwealth Act No. 141, and sections 58, 59 and 60
because it is actually used for the purposes of agriculture, but because it
thereof permit the sale of residential lots to Filipino citizens or to associations or
was originally agricultural and may again become so under other
corporations controlled by such citizens, which is equivalent to a solemn declaration
circumstances; besides, the Act of Congress contains only three
that residential lots are considered as agricultural lands, for, under the Constitution,
classification, and makes no special provision with respect to building lots or
only agricultural lands may be alienated.
urban lands that have ceased to be agricultural land.

It is true that in section 9 of said Commonwealth Act No. 141, "alienable or disposable
In other words, the Court ruled that in determining whether a parcel of land is
public lands" which are the same "public agriculture lands" under the Constitution, are
agricultural, the test is not only whether it is actually agricultural, but also its
classified into agricultural, residential, commercial, industrial and for other puposes.
susceptibility to cultivation for agricultural purposes. But whatever the test might be,
This simply means that the term "public agricultural lands" has both a broad and a
the fact remains that at the time the Constitution was adopted, lands of the public
particular meaning. Under its broad or general meaning, as used in the Constitution, it
domain were classified in our laws and jurisprudence into agricultural, mineral, and
embraces all lands that are neither timber nor mineral. This broad meaning is
timber, and that the term "public agricultural lands" was construed as referring to those
particularized in section 9 of Commonwealth Act No. 141 which classifies "public
lands that were not timber or mineral, and as including residential lands. It may safely
agricultural lands" for purposes of alienation or disposition, into lands that are stricly
be presumed, therefore, that what the members of the Constitutional Convention had
agricultural or actually devoted to cultivation for agricultural puposes; lands that are
in mind when they drafted the Constitution was this well-known classification and its
residential; commercial; industrial; or lands for other purposes. The fact that these
technical meaning then prevailing.
lands are made alienable or disposable under Commonwealth Act No. 141, in favor of
Filipino citizens, is a conclusive indication of their character as public agricultural lands
Certain expressions which appear in Constitutions, . . . are obviously under said statute and under the Constitution.
technical; and where such words have been in use prior to the adoption of a
Constitution, it is presumed that its framers and the people who ratified it
It must be observed, in this connection that prior to the Constitution, under section 24
of Public Land Act No. 2874, aliens could acquire public agricultural lands used for
industrial or residential puposes, but after the Constitution and under section 23 of
Commonwealth Act No. 141, the right of aliens to acquire such kind of lands is
completely stricken out, undoubtedly in pursuance of the constitutional limitation. And,
again, prior to the Constitution, under section 57 of Public Land Act No. 2874, land of
the public domain suitable for residence or industrial purposes could be sold or leased
to aliens, but after the Constitution and under section 60 of Commonwealth Act No.
141, such land may only be leased, but not sold, to aliens, and the lease granted shall
only be valid while the land is used for the purposes referred to. The exclusion of sale
in the new Act is undoubtedly in pursuance of the constitutional limitation, and this
again is another legislative construction that the term "public agricultural land" includes
land for residence purposes.
Such legislative interpretation is also in harmony with the interpretation given by the
Executive Department of the Government. Way back in 1939, Secretary of Justice
Jose Abad Santos, in answer to a query as to "whether or not the phrase 'public
agricultural lands' in section 1 of Article XII (now XIII) of the Constitution may be
interpreted to include residential, commercial, and industrial lands for purposes of their
disposition," rendered the following short, sharp and crystal-clear opinion:
Section 1, Article XII (now XIII) of the Constitution classifies lands of the
public domain in the Philippines into agricultural, timber and mineral. This is
the basic classification adopted since the enactment of the Act of Congress
of July 1, 1902, known as the Philippine Bill. At the time of the adoption of
the Constitution of the Philippines, the term 'agricultural public lands' and,
therefore, acquired a technical meaning in our public laws. The Supreme
Court of the Philippines in the leading case of Mapa vs. Insular
Government, 10 Phil., 175, held that the phrase 'agricultural public lands'
means those public lands acquired from Spain which are neither timber nor
mineral lands. This definition has been followed by our Supreme Court in
many subsequent case. . . .
Residential commercial, or industrial lots forming part of the public domain
must have to be included in one or more of these classes. Clearly, they are
neither timber nor mineral, of necessity, therefore, they must be classified
as agricultural.
Viewed from another angle, it has been held that in determining whether
lands are agricultural or not, the character of the land is the test
(Odell vs. Durant, 62 N.W., 524; Lorch vs. Missoula Brick and Tile Co., 123
p.25). In other words, it is the susceptibility of the land to cultivation for
agricultural purposes by ordinary farming methods which determines
whether it is agricultural or not (State vs. Stewart, 190 p. 129).
Furthermore, as said by the Director of Lands, no reason is seen why a
piece of land, which may be sold to a person if he is to devote it to
agricultural, cannot be sold to him if he intends to use it as a site for his
home.
This opinion is important not alone because it comes from a Secratary of Justice who
later became the Chief Justice of this Court, but also because it was rendered by a
member of the cabinet of the late President Quezon who actively participated in the
drafting of the constitutional provision under consideration. (2 Aruego, Framing of the
Philippine Constitution, p. 598.) And the opinion of the Quezon administration was
reiterated by the Secretary of Justice under the Osmeña administration, and it was
firmly maintained in this Court by the Solicitor General of both administrations.
It is thus clear that the three great departments of the Government — judicial,
legislative and executive — have always maintained that lands of the public domain
are classified into agricultural, mineral and timber, and that agricultural lands include
residential lots.
Under section 1 of Article XIII of the Constitution, "natural resources, with the
exception of public agricultural land, shall not be aliented," and with respect to public
agricultural lands, their alienation is limited to Filipino citizens. But this constitutional
purpose conserving agricultural resources in the hands of Filipino citizens may easily
be defeated by the Filipino citizens themselves who may alienate their agricultural
lands in favor of aliens. It is partly to prevent this result that section 5 is included in
Article XIII, and it reads as follows:
Sec. 5. Save in cases of hereditary succession, no private agricultural land
will be transferred or assigned except to individuals, corporations, or
associations qualified to acquire or hold lands of the public domain in the
Philippines.
This constitutional provision closes the only remaining avenue through which
agricultural resources may leak into aliens' hands. It would certainly be futile to
prohibit the alienation of public agricultural lands to aliens if, after all, they may be
freely so alienated upon their becoming private agricultural lands in the hands of
Filipino citizens. Undoubtedly, as above indicated, section 5 is intended to insure the
policy of nationalization contained in section 1. Both sections must, therefore, be read
together for they have the same purpose and the same subject matter. It must be
noticed that the persons against whom the prohibition is directed in section 5 are the
very same persons who under section 1 are disqualified "to acquire or hold lands of
the public domain in the Philippines." And the subject matter of both sections is the
same, namely, the non-transferability of "agricultural land" to aliens. Since "agricultural
land" under section 1 includes residential lots, the same technical meaning should be
attached to "agricultural land under section 5. It is a rule of statutory construction that
"a word or phrase repeated in a statute will bear the same meaning throughout the
statute, unless a different intention appears." (II Sutherland, Statutory Construction, p.
758.) The only difference between "agricultural land" under section 5, is that the
former is public and the latter private. But such difference refers to ownership and not
to the class of land. The lands are the same in both sections, and, for the conservation
of the national patrimony, what is important is the nature or class of the property Nationalization and Preservation of Lands and other Natural Resources of the
regardless of whether it is owned by the State or by its citizens. Constitutional Convention, is "that lands, minerals, forests, and other natural
resources constitute the exclusive heritage of the Filipino nation. They should,
therefore, be preserved for those under the sovereign authority of that nation and for
Reference is made to an opinion rendered on September 19, 1941, by the Hon.
their posterity." (2 Aruego, Framing of the Filipino Constitution, p. 595.) Delegate
Teofilo Sison, then Secretary of Justice, to the effect that residential lands of the public
Ledesma, Chairman of the Committee on Agricultural Development of the
domain may be considered as agricultural lands, whereas residential lands of private
Constitutional Convention, in a speech delivered in connection with the national policy
ownership cannot be so considered. No reason whatsoever is given in the opinion for
on agricultural lands, said: "The exclusion of aliens from the privilege of
such a distinction, and no valid reason can be adduced for such a discriminatory view,
acquiring public agricultural lands and of owning real estate is a necessary part of the
particularly having in mind that the purpose of the constitutional provision is the
Public Land Laws of the Philippines to keep pace with the idea of preserving the
conservation of the national patrimony, and private residential lands are as much an
Philippines for the Filipinos." (Emphasis ours.) And, of the same tenor was the speech
integral part of the national patrimony as the residential lands of the public domain.
of Delegate Montilla who said: "With the complete nationalization of our lands and
Specially is this so where, as indicated above, the prohibition as to the alienable of
natural resources it is to be understood that our God-given birthright should be one
public residential lots would become superflous if the same prohibition is not equally
hundred per cent in Filipino hands . . .. Lands and natural resources are immovables
applied to private residential lots. Indeed, the prohibition as to private residential lands
and as such can be compared to the vital organs of a person's body, the lack of
will eventually become more important, for time will come when, in view of the
possession of which may cause instant death or the shortening of life. If we do not
constant disposition of public lands in favor of private individuals, almost all, if not all,
completely antionalize these two of our most important belongings, I am afraid that the
the residential lands of the public domain shall have become private residential lands.
time will come when we shall be sorry for the time we were born. Our independence
will be just a mockery, for what kind of independence are we going to have if a part of
It is maintained that in the first draft of section 5, the words "no land of private our country is not in our hands but in those of foreigners?" (Emphasis ours.) Professor
ownership" were used and later changed into "no agricultural land of private Aruego says that since the opening days of the Constitutional Convention one of its
ownership," and lastly into "no private agricultural land" and from these changes it is fixed and dominating objectives was the conservation and nationalization of the
argued that the word "agricultural" introduced in the second and final drafts was natural resources of the country. (2 Aruego, Framing of the Philippine Constitution, p
intended to limit the meaning of the word "land" to land actually used for agricultural 592.) This is ratified by the members of the Constitutional Convention who are now
purposes. The implication is not accurate. The wording of the first draft was amended members of this Court, namely, Mr. Justice Perfecto, Mr. Justice Briones, and Mr.
for no other purpose than to clarify concepts and avoid uncertainties. The words "no Justice Hontiveros. And, indeed, if under Article XIV, section 8, of the Constitution, an
land" of the first draft, unqualified by the word "agricultural," may be mistaken to alien may not even operate a small jitney for hire, it is certainly not hard to understand
include timber and mineral lands, and since under section 1, this kind of lands can that neither is he allowed to own a pieace of land.
never be private, the prohibition to transfer the same would be superfluous. Upon the
other hand, section 5 had to be drafted in harmony with section 1 to which it is
This constitutional intent is made more patent and is strongly implemented by an act
supplementary, as above indicated. Inasmuch as under section 1, timber and mineral
of the National Assembly passed soon after the Constitution was approved. We are
lands can never be private, and the only lands that may become private are
referring again to Commonwealth Act No. 141. Prior to the Constitution, there were in
agricultural lands, the words "no land of private ownership" of the first draft can have
the Public Land Act No. 2874 sections 120 and 121 which granted aliens the right to
no other meaning than "private agricultural land." And thus the change in the final draft
acquire private only by way of reciprocity. Said section reads as follows:
is merely one of words in order to make its subject matter more specific with a view to
avoiding the possible confusion of ideas that could have arisen from the first draft.
SEC. 120. No land originally acquired in any manner under the provisions of
this Act, nor any permanent improvement on such land, shall be
If the term "private agricultural lands" is to be construed as not including residential
encumbered, alienated, or transferred, except to persons, corporations,
lots or lands not strictly agricultural, the result would be that "aliens may freely acquire
associations, or partnerships who may acquire lands of the public domain
and possess not only residential lots and houses for themselves but entire
under this Act; to corporations organized in the Philippine Islands authorized
subdivisions, and whole towns and cities," and that "they may validly buy and hold in
therefor by their charters, and, upon express authorization by the Philippine
their names lands of any area for building homes, factories, industrial plants, fisheries,
Legislature, to citizens of countries the laws of which grant to citizens of the
hatcheries, schools, health and vacation resorts, markets, golf courses, playgrounds,
Philippine Islands the same right to acquire, hold, lease, encumber, dispose
airfields, and a host of other uses and purposes that are not, in appellant's words,
of, or alienate land, or permanent improvements thereon, or any interest
strictly agricultural." (Solicitor General's Brief, p. 6.) That this is obnoxious to the
therein, as to their own citizens, only in the manner and to the extent
conservative spirit of the Constitution is beyond question.
specified in such laws, and while the same are in force but not thereafter.

One of the fundamental principles underlying the provision of Article XIII of the
SEC. 121. No land originally acquired in any manner under the provisions of
Constitution and which was embodied in the report of the Committee on
the former Public Land Act or of any other Act, ordinance, royal order, royal
 decree, or any other provision of law formerly in force in the Philippine
Islands with regard to public lands, terrenos baldios y realengos, or lands of
any other denomination that were actually or presumptively of the public
domain or by royal grant or in any other form, nor any permanent
improvement on such land, shall be encumbered, alienated, or conveyed,
except to persons, corporations, or associations who may acquire land of
the public domain under this Act; to corporate bodies organized in the
Philippine Islands whose charters may authorize them to do so, and, upon
express authorization by the Philippine Legislature, to citizens of the
countries the laws of which grant to citizens of the Philippine Islands the
same right to acquire, hold, lease, encumber, dispose of, or alienate land or
pemanent improvements thereon or any interest therein, as to their own
citizens, and only in the manner and to the extent specified in such laws,
and while the same are in force, but not thereafter: Provided, however, That
this prohibition shall not be applicable to the conveyance or acquisition by
reason of hereditary succession duly acknowledged and legalized by
competent courts, nor to lands and improvements acquired or held for
industrial or residence purposes, while used for such purposes: Provided,
further, That in the event of the ownership of the lands and improvements
mentioned in this section and in the last preceding section being transferred
by judicial decree to persons,corporations or associations not legally
capacitated to acquire the same under the provisions of this Act, such
persons, corporations, or associations shall be obliged to alienate said lands
or improvements to others so capacitated within the precise period of five
years, under the penalty of such property reverting to the Government in the
contrary case." (Public Land Act, No. 2874.)
It is to be observed that the pharase "no land" used in these section refers to all
private lands, whether strictly agricultural, residential or otherwise, there being
practically no private land which had not been acquired by any of the means provided
in said two sections. Therefore, the prohibition contained in these two provisions was,
in effect, that no private land could be transferred to aliens except "upon express
authorization by the Philippine Legislature, to citizens of Philippine Islands the same
right to acquire, hold, lease, encumber, dispose of, or alienate land." In other words,
aliens were granted the right to acquire private land merely by way of reciprocity. Then
came the Constitution and Commonwealth Act No. 141 was passed, sections 122 and
123 of which read as follows:
SEC. 122. No land originally acquired in any manner under the provisions of
this Act, nor any permanent improvement on such land, shall be
encumbered, alienated, or transferred, except to persons, corporations,
associations, or partnerships who may acquire lands of the public domain
under this Act or to corporations organized in the Philippines authorized
thereof by their charters.
SEC. 123. No land originally acquired in any manner under the provisions of
any previous Act, ordinance, royal order, royal decree, or any other
provision of law formerly in force in the Philippines with regard to public
lands terrenos baldios y realengos, or lands of any other denomination that
were actually or presumptively of the public domain, or by royal grant or in
any other form, nor any permanent improvement on such land, shall be
encumbered, alienated, or conveyed, except to persons, corporations or
associations who may acquire land of the public domain under this Act or to
corporate bodies organized in the Philippines whose charters authorize
them to do so: Provided, however, That this prohibition shall not be
applicable to the conveyance or acquisition by reason of hereditary
succession duly acknowledged and legalized by competent
courts: Provided, further, That in the event of the ownership of the lands and
improvements mentioned in this section and in the last preceding section
being transferred by judicial decree to persons, corporations or associations
not legally capacitated to acquire the same under the provisions of this Act,
such persons, corporations, or associations shall be obliged to alienate said
lands or improvements to others so capacitated within the precise period of
five years; otherwise, such property shall revert to the Government.
These two sections are almost literally the same as sections 120 and 121 of Act No.
2874, the only difference being that in the new provisions, the right to reciprocity
granted to aliens is completely stricken out. This, undoubtedly, is to conform to the
absolute policy contained in section 5 of Article XIII of the Constitution which, in
prohibiting the alienation of private agricultural lands to aliens, grants them no right of
reciprocity. This legislative construction carries exceptional weight, for prominent
members of the National Assembly who approved the new Act had been members of
the Constitutional Convention.
It is said that the lot question does not come within the purview of sections 122 and
123 of Commonwealth Act No. 141, there being no proof that the same had been
acquired by one of the means provided in said provisions. We are not, however,
diciding the instant case under the provisions of the Public Land Act, which have to
refer to land that had been formerly of the public domain, otherwise their
constitutionality may be doubtful. We are deciding the instant case under section 5 of
Article XIII of the Constitution which is more comprehensive and more absolute in the
sense that it prohibits the transfer to alien of any private agricultural land including
residential land whatever its origin might have been.
And, finally, on June 14, 1947, the Congress approved Republic Act No. 133 which
allows mortgage of "private real property" of any kind in favor of aliens but with a
qualification consisting of expressly prohibiting aliens to bid or take part in any sale of
such real property as a consequence of the mortgage. This prohibition makes no
distinction between private lands that are strictly agricultural and private lands that are
residental or commercial. The prohibition embraces the sale of private lands of any
kind in favor of aliens, which is again a clear implementation and a legislative
interpretation of the constitutional prohibition. Had the Congress been of opinion that
private residential lands may be sold to aliens under the Constitution, no legislative
measure would have been found necessary to authorize mortgage which would have
been deemed also permissible under the Constitution. But clearly it was the opinion of
the Congress that such sale is forbidden by the Constitution and it was such opinion
that prompted the legislative measure intended to clarify that mortgage is not within
the constitutional prohibition.
It is well to note at this juncture that in the present case we have no choice. We are qualified to acquire public or private agricultural lands under the provisions of the
construing the Constitution as it is and not as we may desire it to be. Perhaps the Constitution."
effect of our construction is to preclude aliens, admitted freely into the Philippines from
owning sites where they may build their homes. But if this is the solemn mandate of
On August 15, 1940, Judge P. Magsalin rendered decision granting the application.
the Constitution, we will not attempt to compromise it even in the name of amity or
The Director of Lands appealed. In the brief filed by Solicitor General Roman Ozaeta,
equity. We are satisfied, however, that aliens are not completely excluded by the
afterwards Associate Justice of the Supreme Court and now Secretary of Justice, and
Constitution from the use of lands for residential purposes. Since their residence in the
Assistant Solicitor General Rafael Amparo, appellant made only two assignments of
Philippines is temporary, they may be granted temporary rights such as a lease
error, although both raised but one question, the legal one stated in the first
contract which is not forbidden by the Constitution. Should they desire to remain here
assignment of error as follows:
forever and share our fortunes and misfortunes, Filipino citizenship is not impossible
to acquire.
The lower court erred in declaring the registration of the land in question in
favor of the applicant who, according to his own voluntary admission is a
For all the foregoing, we hold that under the Constitution aliens may not acquire
citizen of the Chinese Republic.
private or public agricultural lands, including residential lands, and, accordingly,
judgment is affirmed, without costs.
The brief was accompanied, as Appendix A, by the opinion of Secretary of Justice
Jose A. Santos — who, while Chief Justice of the Supreme Court, suffered heroic
Feria, Pablo, Perfecto, Hilado, and Briones, JJ., concur.
martyrdom at the hands of the Japanese — addressed to the Secretary of Agriculture
and Commerce on July 15, 1939, supporting the same theory as the one advanced by
Separate Opinion the Director of Lands. The same legal question raised by appellant is discussed, not
only in the brief for the appellee, but also in the briefs of the several amici
curiae allowed by the Supreme Court to appear in the case.
PERFECTO, J., concurring:

Today, which is the day set for the promulgation of this Court's decision might be
remembered by future generations always with joy, with gratitude, with pride. The
failure of the highest tribunal of the land to do its duty in this case would have
amounted to a national disaster. We would have refused to share the responsibility of
causing it by, wittingly or unwittingly, allowing ourselves to act as tools in a conspiracy
to sabotage the most important safeguard of the age-long patrimony of our people, the
land which destiny of Providence has set aside to be the permanent abode of our race
for unending generations. We who have children and grandchildren, and who expect
to leave long and ramifying dendriform lines of descendants, could not bear the
thought of the curse they may fling at us should the day arrive when our people will be
foreigners in their fatherland, because in the crucial moment of our history , when the
vision of judicial statemanship demanded on us the resolution and boldness to affirm
and withhold the letter and spirit of the Constitution, we faltered. We would have
prefered heroic defeat to inglorious desertion. Rather than abandon the sacred folds of
the banner of our convictions for truth, for justice, for racial survival. We are happy to
record that this Supreme Court turned an impending failure to a glorious success,
saving our people from a looming catastrophe.
On July 3, 1946, the case of Oh Cho vs. Director of Lands, (43 Off. Gaz., 866), was
submitted for our decision. The case was initiated in the Court of First Instance of
Tayabas on January 17, 1940, when an alien, Oh Cho, a citizen of China, applied for
title and registration of a parcel of land located in the residential district of
Guinayangan, Tayabas, with a house thereon. The Director of Lands opposed the
application, one of the main grounds being that "the applicant, being a Chinese, is not
As a matter of fact, the case has been submitted for final decision of the Supreme
Court since July of 1941, that is, six years ago. It remained undecided when the
Pacific War broke out in December, 1941. After the Supreme Court was recognized in
the middle of 1945, it was found that the case was among those which were destroyed
in February, 1945, during the battle for the liberation of Manila. The case had to be
reconstituted upon motion of the office of the Solicitor General, filed with this Court on
January 14, 1946, in which it was also prayed that, after being reconstituted, the case
be submitted for final adjudication. The case was for the second time submitted for
decision on July 3, 1946.
After the last submission, it took the Supreme Court many days to deliberate on the
case, especially on the legal question as to whether an alien may, under the
Constitution, acquire private urban lands. An overwhelming majority answered no. But
when the decision was promulgated on August 31, 1946, a majority resolved to ignore
the question, notwithstanding our efforts to have the question, which is vital, pressing
and far-reaching, decided once and for all, to dispel definitely the uncertainty gnawing
the conscience of the people. It has been out lot to be alone in expressing in
unmistakable terms our opinion and decision on the main legal question raised by the
appellant. The constitutional question was by-passed by the majority because they
were of opinion that it was not necessary to be decided, notwithstanding the fact that it
was the main and only legal question upon which appellant Director of Lands relied in
his appeal, and the question has been almost exhaustively argued in four printed
briefs filed by the parties and the amici curiae. Assurance was, nevertheless, given
that in the next case in which the same constitutional question is raised, the majority
shall make known their stand on the question.
The next case came when the present one submitted to us for decision on February 3,
1947. Again, we deliberated on the constitutional question for several days.
On February 24, 1947, the case was submitted for final vote, and the result was that
the constitutional question was decided against petitioner. The majority was also
overwhelming. There were eight of us, more than two-thirds of the Supreme Court.
Only three Justices dissented.
While the decision was being drafted, somehow, the way the majority had voted must
have leaked out. On July 10, 1947, appellant Krivenko filed a motion for withdrawal of
his appeal, for the evident purpose of preventing the rendering of the majority
decision, which would settle once and for all the all-important constitutional question
as to whether aliens may acquire urban lots in the Philippines.
Appellant chose to keep silent as to his reason for filing the motion. The Solicitor
General's office gave its conformity to the withdrawal of the appeal. This surprising
assent was given without expressing any ground at all. Would the Supreme Court
permit itself to be cheated of its decision voted since February 24, 1947?
Discussion immediately ensued as to whether the motion should be granted or denied,
that is, whether this Court should abstain from promulgating the decision in
accordance with the result of the vote taken on February 24, 1947, as if, after more
than six years during which the question has been submitted for the decision of the
highest tribunal of the land, the same has failed to form a definite opinion.
After a two-day deliberation, the Chief Justice, Mr. Justice Paras, Mr. Justice
Hontiveros, Mr. Justice Padilla and and Mr. Justice Tuason voted to grant the motion
for withdrawal. Those who voted to deny the motion were Mr. Justice Feria, Mr.
Justice Pablo, ourselves, Mr. Justice Hilado and Mr. Justice Bengzon. The vote thus
resulted in a tie, 5-5. The deadlock resulting from the tie should have the effect of
denying the motion, as provided by section 2 of Rule 56 to the effect that "where the
Court in banc is equally divided in opinion . . . on all incidental matters, the petition or
motion shall be denied." And we proposed that the rule be complied with, and the
denial be promulgated.
Notwithstanding this, as Mr. Justice Briones was then absent, our brethren resolved to
give him the opportunity of casting his vote on the question, although we insisted that
it was unnecessary. Days later, when all the members of the Court were already
present, a new vote was taken. Mr. Justice Briones voted for the denial of the motion,
and his vote would have resulted, as must be expected, in 6 votes for the denial
against 5 for granting. But the final result was different. Seven votes were cast for
granting the motion and only four were cast for its denial.
But then, by providential design or simply by a happy stroke of luck or fate, on the
occasion of the registration by the register of deeds of Manila of land purchases of two
aliens, a heated public polemic flared up in one section of the press, followed by
controversial speeches, broadcast by radio, and culminating in the issuance on
August 12, 1947, of Circular No. 128 of the Secretary of Justice which reads as
follows:
TO ALL REGISTER OF DEEDS:
Paragraph 5 of Circular No. 14, dated August 25, 1945, is hereby amended so as to
read as follows:
5"(a). Instruments by which private real property is mortgaged in favor of
any individual, corporation, or association for a period not exceeding five
years, renewable for another five years, may be accepted for registration.
(Section 1, Republic Act No. 138.)
"(b). Deeds or documents by which private residential, commercial,
industrial or other classes of urban lands, or any right, title or interest therein
is transferred, assigned or encumbered to an alien, who is not an enemy
national, may be registered. Such classes of land are not deemed included
within the purview of the prohibition contained in section 5, Article XIII of the
Constitution against the acquisition or holding of "private agricultural
land" by those who are not qualified to hold or acquire lands of the public
domain. This is in conformity with Opinion No. 284, series of 1941, of the
Secretary of Justice and with the practice consistently followed for nearly
ten years since the Constitution took effect on November 15, 1935.
"(c). During the effectivity of the Executive Agreement entered into between
the Republic of the Philippines and the Government of the United States on
July 4, 1946, in pursuance of the so-called Parity Amendment to the
Constitution, citizens of the United States and corporations or associations
owned or controlled by such citizens are deemed to have the same rights as
citizens of the Philippines and corporations or associations owned or
controlled by such are deemed to have the same rights as citizens of the
Philippines and corporations or associations owned or controlled by citizens
of the Philippines in the acquisition of all classes of lands in the Philippines,
whether of private ownership or pertaining to the public domain."
ROMAN OZAETA
Secretary of Justice
Paragraph 5 of Circular No. 14 dated August 25, 1945, amended by the above is as
follows:
Deeds or other documents by which a real property, or a right, or title
thereto, or an interest therein, is transferred, assigned or encumbered to an
alien, who is not enemy national, may be entered in the primary entry book;
but, the registration of said deeds or other documents shall be denied —
unless and/or until otherwise specifically directed by a final decision or order
 of a competent court — and the party in interest shall be advised of such denied. Said first vote took place many days before the one alluded to by
denial, so that he could avail himself of the right to appeal therefrom, under Mr. Justice Padilla.
the provisions of section 200 of the Revised Administrative Code. The
denial of registration of shall be predicated upon the prohibition contained in
Mr. Justice Tuason states: The motion to withdraw the appeal was first
section 5, Article XIII (formerly Article XII) of the Constitution of the
voted upon with the result that 5 were granting and 5 for denial. Mr. Justice
Philippines, and sections 122 and 123 of Commonwealth Act No. 141, the
Briones was absent and it was decided to wait for him. Some time later, the
former as amended by the Commonwealth Act No. 615.
same subject was deliberated upon and a new voting was had, on which
occasion all the 11 justices were present. The voting stood 7 for allowing the
The polemic found echo even in the Olympic serenity of a cloistered Supreme Court dismissal of the appeal and 4 against. Mr. Justice Perfecto and Mr. Justice
and the final result of long and tense deliberation which ensued is concisely recorded Briones expressed the intention to put in writing their dissents. Before these
in the following resolution adopted on August 29, 1947: dissents were filed, about one month afterwards, without any previous
notice the matter was brought up again and re-voted upon; the result was 5
to 5. Mr. Justice Hontiveros, who was ill but might have been able to attend
In Krivenko vs. Register of Deeds, City of Manila, L-630, a case already
if advised of the necessity of his presence, was absent. As the voting thus
submitted for decision, the appellant filed a motion to withdraw his appeal
stood, Mr. Justice Hontiveros' vote would have changed its result unless he
with the conformity of the adverse party. After full discussion of the matter
changed his mind, a fact of which no one is aware. My opinion is that since
specially in relation to the Court's discretion (Rule 52, section 4, and Rule
there was no formal motion for reconsideration nor a previous notice that
58), Mr. Justice Paras, Mr. Justice Hilado, Mr. Justice Bengzon, Mr. Justice
this matter would be taken up once more, and since Mr. Justice Hontiveros
Padilla and Mr. Justice Tuazon voted to grant, while the Chief Justice, Mr.
had every reason to believe that the matter was over as far as he was
Justice Feria, Mr,. Justice Pablo, Mr. Justice Perfecto and Mr. Justice
concerned, this Justice's vote in the penultimate voting should, if he was not
Briones voted to deny it. A redeliberation was consequently had, with the
to be given an opportunity to recast his vote, be counted in favor of the vote
same result. Thereupon Mr. Justice Paras proposed that Mr. Justice
for the allowance of the motion to withdraw. Above all, that opportunity
Hontiveros be asked to sit and break the tie; but in view of the latter's
should not have been denied on grounds of pure technicality never invoked
absence due to illness and petition for retirement, the Court by a vote of
before. I counted that the proceeding was arbitrary and illegal.
seven to three did not approve the proposition. Therefore, under Rule 56,
section 2, the motion to withdraw is considered denied.
The resolution does not recite all the reasons why Mr. Justice Hontiveros did not
participate in that last two votings and why it became unnecessary to wait for him any
Mr. Justice Padilla states that in his opinion the tie could not have the effect
further to attend the sessions of the Court and to cast his vote on the question.
of overruling the previous vote of seven against four in favor of the motion to
withdraw.
Appellant Krivenko moved for the reconsideration of the denial of his withdrawal of
appeal, alleging that it became moot in view of the ruling made by the Secretary of
Mr. Justice Paras states: Justice Hontiveros is aware of and conversant with
Justice in circular No. 128, thus giving us a hint that the latter, wittingly or unwittingly,
the controversy. He has voted once on the motion to withdraw the appeal.
had the effect of trying to take away from the Supreme Court the decision of an
He is still a member of the Court and, on a moment's notice, can be present
important constitutional question, submitted to us in a pending litigation. We denied
at any session of the Court. Last month, when all the members were
the motion for reconsideration. We did not want to entertain any obstruction to the
present, the votes on the motion stood 7 to 4. Now, in the absence of one
promulgation of our decision.
member, on reconsideration, another changed his vote resulting in a tie.
Section 2 of Rule 56 requires that all efforts be exerted to break a deadlock
in the votes. I deplore the inability of the majority to agree to my proposition If the processes had in this case had been given the publicity suggested by us for all
that Mr. Justice Hontiveros be asked to participate in the resolution of the the official actuations of this Supreme Court, it should have been known by the whole
motion for withdrawal. I hold it to be fundamental and necessary that the world that since July, 1946, that is, more than a year ago, the opinion of the members
votes of all the members be taken in cases like this. of this Court had already been crystallized to the effect that under the Constitution,
aliens are forbidded from acquiring urban lands in the Philippines, and it must have
known that in this case a great majority had voted in that sense on February 24, 1947.
Mr. Justice Perfecto stated, for purposes of completeness of the narration of
facts, that when the petition to withdraw the appeal was submitted for
resolution of this Court two days after this petition was filed, five justices The constitutional question involved in this case cannot be left undecided without
voted to grant and five others voted to deny, and expressed the opinion that jeopardizing public interest. The uncertainty in the public mind should be dispelled
since then, according to the rules, the petition should have been considered without further delay. While the doubt among the people as to what is the correct
answer to the question remains to be dissipated, there will be uneasiness,
undermining public morale and leading to evils of unpredictable extent. This Supreme enemy attacks in war, said Delegates set the guarantees to ward off open inroads or
Tribunal, by overwhelming majority, already knows what the correct answer is, and devious incursions into the national patrimony as a means of insuring racial safety and
should not withhold and keep it for itself with the same zealousness with which the survival.
ancient families of the Eumolpides and Keryces were keeping the Eleusinian
mysteries. The oracle of Delphus must speak so that the people may know for their
When the ideal of one world should have been translated into reality, those
guidance what destiny has in store for them.
guarantees might not be needed and our people may eliminate them. But in the
meantime, it is our inescapable devoir, as the ultimate guardians of the Constitution,
The great question as to whether the land bequeathed to us by our forefathers should never to neglect the enforcement of its provisions whenever our action is called upon
remain as one of the most cherished treasures of our people and transmitted by in a case, like the one now before us.
inheritance to unending generations of our race, is not a new one. The long chain of
land-grabbing invasions, conquests, depredations, and colonial imperialism recorded
One of the fundamental purposes of the government established by our Constitution
in the darkest and bloodiest pages of history from the bellicose enterprises of the
is, in its very words, that it "shall conserve and develop the patrimony of the nation."
Hittites in the plains of old Assyria, irrigated by the waters of the Tigris and Euphrates,
That mandate is addressed to all departments and branches of our government,
and the invasion of Egypt by the Hyksos, up to the conquests of Hernan Cortes and
without excluding this Supreme Court. To make more specific the mandate, Article XIII
Pizarro, the achievements of Cecil Rhodes, and the formation of the Spanish,
has been inserted so as to avoid all doubt that all the natural resources of the country
Portuguese, Dutch, French and German colonial empires, had many of its iron links
are reserved to Filipino citizens. Our land is the most important of our natural
forged in our soil since Magellan, the greatest navigator of all history, had set foot at
resources. That land should be kept in the hands of our people until, by constitutional
Limasawa and paid, for his daring enterprises, with his life at the hands of Lapulapu's
amendment, they should decide to renounce that age-long patrimony. Save by
men in the battle of Mactan.
hereditary succession — the only exception allowed by the Constitution — no
foreigner may by any means acquire any land, any kind of land, in the Philippines.
Since then, almost four centuries ago, our people have continuously been engaged in That was the overwhelming sentiment prevailing in the Constitutional Convention, that
an unrelentless struggle to defend the national patrimony against the aggressive was the overpowering desire of the great majority of the Delegates, that was the
onslaughts of foreigners bent on grabbing our lands. First came the dominating thought that was intended to be expressed in the great document, that was
Spanish encomenderos and other gratuitous concessioners who were granted by the what the Committee on Style — the drafter of the final text — has written in the
Spanish crown immense areas of land. Immediately came the friars and other Constitution, and that was what was solemnly ratified in the plebiscite by our people,
religious corporations who, notwithstanding their sacred vow of poverty, felt their who then were rankling by the sore spot of illegally Japanized Davao.
greed whetted by the bountiful opportunities for easy and unscrupulous enrichment.
Taking advantage of the uncontrollable religious leadership, on one side, and of the
The urgency of settling once and forever the constitutional question raised
Christian virtues of obedience, resignation, humility, and credulity of a people who,
in this case cannot be overemphasized. If we should decide this question
after conversion to Catholicism, embraced with tacit faith all its tenets and practiced
after many urban lots have been transferred to and registered in the name
them with the loyalty and fidelity of persons still immune from the disappointments and
of alien purchasers, a situation may be created in which it will be hard to
bitterness caused by the vices of modern civilization, the foreign religious orders set
nullify the transfers and the nullification may create complications and
aside all compunction to acquire by foul means many large estates. Through the
problems highly distasteful to solve. The Georgia case is an objective
practice of confession and other means of moral intimidation, mostly based on the
lesson upon which we can mirror ourselves. From pages 22 and 23 of the
eternal tortures of hell, they were able to obtain by donation or by will the lands of
book of Charless P. Curtiss, Jr. entitled "Lions Under the Throne," we quote
many simple and credulous Catholics who, in order to conquer the eternal bliss of
the following:
heaven, renounced all their property in favor of religious orders and priests, many
under the guise of chaplaincies or other apparently religious purposes, leaving in
destitute their decendants and relatives. Thus big religious landed estates were It is of interest that it seems to have happened chiefly in important cases.
formed, and under the system unbearable iniquities were committed. The case of the Fletcher vs. Peck, in 1810, is the stock example. That was the first case in
family of Rizal is just an index of the situation, which, under the moral leadership of the which the Court held a state statute void. It involved a national scandal. The
hero, finally drove our people into a national revolution not only against the Spanish 1795 legislature of Georgia sold its western lands, most of Alabama and
sovereignty under which the social cancer had grown to unlimited proportions. Mississippi, to speculators. Perhaps it was the greatest real estate steal in
our history. The purchase price was only half a million dollars. The next
legislature repealed the statute for fraud, the bribery of legislator, but not
Profiting from the lessons of history, the Delegates to our Constitutional Convention
before the land companies had completed the deal and unloaded. By that
felt it their duty to insert in the fundamental law effective guarantees for conserving the
time, and increasingly soon afterwards, more and more people had bought,
national patrimony, the wisdom of which cannot be disputed in a world divided into
and their title was in issue. Eleven million of the acres had been bought for
nations and nationalities. In the same way that scientists and technicians resorted to
eleven cents an acre by leading citizens of Boston. How could they clear
radar, sonars, thermistors and other long range detection devices to stave off far-away
 their title? Alexander Hamilton gave an opinion, that the repeal of the grant
was void under the Constitution as an impairment of the obligation of a
contract.
But could they not get a decision from the Supreme Court? Robert Fletcher
of Anhirst, New Hampshire, had bought fifteen thousand acres from John
Peck of Boston. He sued Peck, and he won. Fletcher appealed. Plainly it
was a friendly suit. Marshall was nobody's fool. He told Cranch that the
Court was reluctant to decide the case "as it appeared manifestly made up
for the purpose of getting the Court's judgment." John Quincy Adams so
reports in his diary. Yet Marshall decided it, and he held the repeal void, just
as Hamilton said it was. "The fact that Marshall rendered an opinion, under
the circumstances," says Beveridge, "is one of the finest proofs of his
greatness. A weaker man than John Marshall, and one less wise and
courageous, would have dismissed the appeal." That may be, but it was the
act of a stateman, not of a judge. The Court has always been able to
overcome its judicial diffidence on state occasions.
We see from the above how millions of acres of land were stolen from the people of
Georgia and due to legal technicalities the people were unable to recover the stolen
property. But in the case of Georgia, the lands had fallen into American hands and
although the scandal was of gigantic proportions, no national disaster ensued. In our
case if our lands should fall into foreign hands, although there may not be any scandal
at all, the catastrophe sought to be avoided by the Delegates to our Constitutional
Convention will surely be in no remote offing.
We conclude that, under the provisions of the Constitution, aliens are not allowed to
acquire the ownership of urban or residential lands in the Philippines and, as
consequence, all acquisitions made in contravention of the prohibitions since the
fundamental law became effective are null and void per se and ab initio. As all public
officials have sworn, and are duty bound, to obey and defend the Constitution, all
those who, by their functions, are in charge of enforcing the prohibition as laid down
and interpreted in the decision in this case, should spare no efforts so that any and all
violations which may have taken place should be corrected.
We decide, therefore, that, upon the above premises, appellant Alexander A.
Krivenko, not being a Filipino citizen, could not acquire by purchase the urban or
residential lot here in question, the sale made in his favor by the Magdalena Estate,
Inc. being null and void ab initio, and that the lower court acted correctly in rendering
the appealed decision, which we affirm.
HILADO, J., concurring:
Upon appellant's motion to withdraw his appeal herein with the conformity of the
Solicitor General in behalf of appellee, indulging, at that time, all possible intendments
in favor of another department, I ultimately voted to grant the motion after the matter
was finally deliberated and voted upon. But the votes of the ten Justices participating
were evenly divided, and under Rule 52, section 4, in relation, with Rule 56, section 2,
the motion was denied. The resolution to deny was adopted in the exercise of the
court's discretion under Rule 52, section 4, by virtue of which it has discretion to deny
the withdrawal of the appeal even though both appellant and appellee agree upon the
withdrawal, when appellee's brief has been filed. Under the principle that where the
necessary number have concurred in an opinion or resolution, the decision or
determination rendered is the decision or determination of the court (2 C.J.S., 296),
the resolution denying the motion to withdraw the appeal was the resolution of the
court. Pursuant to Rule 56, section 2, where the court in banc is equally divided in
opinion, such a motion "shall be denied." As a necessary consequence, the court as to
decide the case upon the merits.
After all, a consistent advocate and defender of the principle of separation of powers
in a government like ours that I have always been, I think that under the
circumstances it is well for all concerned that the Court should go ahead and decide
the constitutional question presented. The very doctrine that the three coordinate, co-
equal and independent departments should be maintained supreme in their respective
legitimate spheres, makes it at once the right and duty of each to defend and uphold
its own peculiar powers and authority. Public respect for and confidence in each
department must be striven for and kept, for any lowering of the respect and
diminution of that confidence will in the same measure take away from the very
usefulness of the respective department to the people. For this reason, I believe that
we should avert and avoid any tendency in this direction with respect to this Court.
I am one of those who presume that Circular No. 128, dated August 12, 1947, of the
Secretary of Justice, was issued in good faith. But at the same time, that declaration in
sub-paragraph (b) of paragraph 5 of Circular No. 14, which was already amended, to
the effect that private residential, commercial, industrial or other classes of urban
lands "are not deemed included within the purview of the prohibition contained in
section 5, Article XIII, of the Constitution", made at a time when the self-same
question was pending decision of this Court, gives rise to the serious danger that
should this Court refrain from deciding said question and giving its own interpretation
of the constitutional mandate, the people may see in such an attitude an abandonment
by this Court of a bounden duty, peculiarly its own, to decide a question of such a
momentous transcedence, in view of an opinion, given in advance of its own decision,
by an officer of another department. This will naturally detract in no small degree from
public respect and confidence towards the highest Court of land. Of course, none of
us — the other governmental departments included — would desire such a situation to
ensue.
I have distinctively noticed that the decision of the majority is confined to the
constitutional question here presented, namely, "whether or not an alien under our
Constitution may acquire residential land." (Opinion, p. 2) Leases of residential lands,
or acquisition, ownership or lease of a house or building thereon, for example, are not
covered by the decision.
With these preliminary remarks and the statement of my concurrence in the opinion
ably written by the Chief Justice, I have signed said decision.
BRIONES, M., conforme:
Estoy conforme en un todo con la ponencia, a la cual no e puede añadir ni quitar
nada, tal es su acabada y compacta elaboracion. Escribo, sin embargo, esta opinion
separada nada mas que para unas observaciones, particularmente sobre ciertas
fases extraordinarias de este asunto harto singular y extraordinario.
I. Conforme se relata en la concurrencia del Magistrado Sr. Perfecto, despues de
laboriosas deliberaciones este asunto se puso finalmente a votacion el 24 de Febrero
de este año, confirmandose la sentencia apelada por una buena mayoria. En algunos
comentarios adelantados por cierta parte de la prensa — impaciencia que solo puede
hallar explicacion en un nervioso y excesivo celo en la vigilancia de los intereses
publicos, maxime tratandose, como se trata, de la conservacion del patrimonio
nacional — se ha hecho la pregunta de por que se ha demorado la promulgacion de
la sentencia, habiendose votado el asunto todavia desde case comienzos del año.
A simple vista, la pregunta tiene justificacion; pero bien considerados los hechos se
vera que no ha habido demora en el presente caso, mucho menos una demora
desusada, alarmante, que autorice y justifique una critica contra los metodos de
trabajo de esta corte. El curso seguido por el asunto ha sido normal, bajo las
circunstancias. En realidad, no yan en esta Corte ahora, sino aun en el pasado, antes
de la guerra, hubo mas lentitud en casos no tan dificiles ni tan complicados como el
que nos ocupa, en que las cuestiones planteadas y discutidas no tenian la densidad
constitucional y juridica de las que se discuten en el presente caso. Hay que tener en
cuenta que desde el 24 de Febrero en que se voto finalmente el asunto hasta el 1.0
de Abril en que comenzaron las vacaciones judiciales, no habian transcurrido mas
que 34 dias; y cuando se reanudaron formalmente las sesiones de esta Corte en Julio
se suscito un incidente de lo mas extraordinario — incidente que practicamente vino a
impedir, a paralizar la pronta promulgacion de la sentencia. Me refiero a la mocion
que el 10 de Julio persentaron los abogados del apelante pidiendo permiso para
retirar su apelacion. Lo sorpredente de esta mocion es que viene redactada
escuetamente, sin explicar el por que de la retirada, ni expresar ningun fundamento.
Pero lo mas sorpredente todavia es la conformidad dada por el Procurador General,
tambien escueta e inceremoniosamente.
Digo que es sorprendente la retirada de la apelacion porque pocos casos he visto que
hayan sido arguidos con tanta energiaa, tanto interes y tanto celo por la parte
apelante como este que nos ocupa. Los abogados del apelante no solo presentaron
un alegato concienzudo de 34 paginas, sino que cuando se llamo a vista el asunto
informaron verbalmente ante esta Corte argumentando vigorosa y extensamente
sobre el caso. El Procurador General, por su parte, ha presentado un alegato
igualmente denso, de 31 paginas, en que se discuten acabadamente, hasta el punto
maximo de saturacion y agotamiento, todos los angulos de la formidable cuestion
constitutional objeto de este asunto. Tambien informo el Procurador General
verbalmente ante esta Corte, entablando fuerte lid con los abogados del apelante.
Con la mocion de retirada de la apelacion se hubo de retardar necesariamente la
promulgacion de la sentencia, pues trabajosas deliberaciones fueron necesarias para
resolver la cuestion, dividiendose casi por igual los miembros de la Corte sobre si
debia o no permitirse la retirada. Habia unanimidad en que bajo la regla 52, seccion 4,
del Reglamento de los Tribunales teniamos absoluta discrecion para conceder o
denegar la mocion, toda vez que los alegatos estaban sometidos desde hacia tiempo,
el asunto estaba votado y no faltaba mas que la firma y promulgacion de la decision
juntamente con las disidencias. Sin embargo, algunos Magistrados opinaban que la
discrecion debia ejercitarse en favor de la retirada en virtud de la practica de evitar la
aplicacion de la Constitucion a la solucion de un litigio siempre que se puede
sentenciarlo de otra manera. (Entre los Magistrados que pensaban de esta manera se
incluian algunos que en el fundo del asunto estaban a favor de la confirmacion de la
sentencia apelada, es decir, creian que la Constitucion prohibe a los extranjeros la
adquisicion a titulo dominical de todo genero de propiedad inmueble, sin excluir los
solares residenciales, comerciales e industriales.) Pero otros Magistrados opinaban
que en el estado tan avanzado en que se hallaba el asunto los dictados del interes
publico y de la sana discrecion requerian imperiosamente que la cuestion se atacase
y decidiese frontalmente; que si una mayoria de esta Corte estaba convencida, como
al parecer lo estaba, de que existia esa interdiccion constitucional contra la facultad
adquisitiva de los extranjeros, nuestro claro deber era apresurarnos a dar pleno y
positivo cumplimiento a la Constitucion al presentarse la primera oportunidad; que el
meollo del asunto, la lis mota era eso — la interdiccion constitucional — ; por tanto, no
habia otra manera de decidirlo mas que aplicando la Constitucion; obrar de otra
manera seria desercion, abandono de un deber jurado.
Asi estaban las deliberaciones cuando ocurre otro incidente mucho mas
extraordinario y sorprendente todavia que la retirada no explicada de la apelacion con
la insolita conformidad del Procurador General; algo asi como si de un cielo sereno,
sin nubes, cayera de pronto un bolido en medio de nosotros, en medio de la Corte:
me refiero a la circular num. 128 del Secretario de Justicia expedida el 12 de Agosto
proximo pasado, esto es, 32 dias despues de presentada la mocion de retirada de la
apelacion. Esa circular se cita comprensivamente en la ponencia y su texto se copia
integramente en la concurrencia del Magistrado Sr. Perfecto; asi que me creo
excusado de transcibirla in toto. En breves terminos, la circular reforma el parrafo 5 de
la circular num. 14 del mismo Departamento de Justicia de fecha 25 de Agosto, 1945,
y levanta la prohibicion o interdiccion sobre el registro e inscripcion en el registro de la
propiedad de las "escrituras o documentos en virtud de los cuales terrenos privados
residencias, comerciales, industriales u otras clases de terrenos urbanos, o cualquier
derecho, titulo o interes en ellos, se transfieren, ceden o gravan a un extranjero que
no es nacional enemigo." En otras palabras, el Secretario de Justicia, por medio de
esta circular dejaba sin efecto la prohibicion contenida en lacircular num. 14 del
mismo Departamento — la prohibicion que precisamente ataca el apelante Krivenko
en el asunto que tenemos ante Nos — y authorizaba y ordenaba a todoslos
Registradores de Titulos en Filipinas para que inscribiesen las escrituras o
documentos de venta, hipoteca o cualquier otro gravamen a favor de extranjeros,
siempre que no se tratase de terrenos publicos o de "terrenos privados agricolas," es
decir, siempre que los terrenos objeto de la escritura fuesen "residenciales,
comerciales e industriales."
La comparacion de esa circular con un bolido caido subitamenteen medio de la Corte
no es un simple tropo, no esuna mera imagen retorica; refleja una verdadera
realidad.Esa circular, al derogar la prohibicion decretada en elparrafo 5 de la circular
num. 14 — prohibicion que, comoqueda dicho, es precisamente el objeto del presente
asunto — venia practicamente a escamotear la cuestion discutida, lacuestion sub
judice sustrayendola de la jurisdiccion de lostribunales. Dicho crudamente, el
Departamento de Justiciavenia a arrebatar el asunto de nuestras manos, delas manos
de esta Corte, anticipandose a resolverlo por simismo y dando efectividad y vigor
inmediatos a su resolucionmediante la correspondiente autorizacion a los
Registradoresde Titulos.
A la luz de esa circular queda perfectamente explicadala mocion de retirada de la
apelacion consentida insolitamentepor el Procurador General. ¿ Para que esperar
ladecision de la Corte Suprema que acaso podria ser adversa? ¿ No estaba ya esa
circular bajo la cual podian registrarseahora la ventas de terrenos residenciales,
comerciales oindustriales a extranjeros? Por eso no es extraño quelos abogados del
apelante Krivenko, en su mocion de 1.0 de Septiembre, 1947, pidiendo la
reconsideracion de nuestroauto denegando la retirada de la apelacion, dijeran
porprimera vez como fundamento que la cuestion ya era simplemente academica
("question is now moot") en vista deesa circular y de la conformidad del Procurador
Generalcon la retirada de la apelacion. He aqui las propias palabras de la mocion del
apelante Krivenko:
In view of Circular No. 128 of the Department of Justice, dated August 12,
1947, which amends Circular No. 14 by expressly authorizing the
registration of the sale of urban lands to aliens, and in view of the fact that
the Solicitor General has joined in the motion for withdrawal of the appeal,
there is no longer a controversy between the parties and the question is
now moot. For this reason the court no longer has jurisdiction to act on the
case.1
Lo menos que se puede decir de esa accion del Departamentode Justicia
atravesandose en el camino de los tribunalesmientras un asunto esta sub judice, es
que ello no tieneprecedentes, que yo sepa, en los anales de la administracionde
justicia en Filipinas en cerca de medio siglo que llevamosde existencia bajo un
gobierno constitucional y sustancialmente republicano. Ni aun en los llamados dias
del Imperio, cuando la soberania americana era mas propensa a manejar el baston
grueso y afirmar vigorosamente losfueros de su poder y autoridad, se vio jamas a un
departamento de Justicia o a alguna de sus dependencias entrometerseen el ejercicio
ordenado por los tribunales de sujurisdiccion y competencia. Era una tradicion
firmamenteestablecida en las esfersas del Poder Ejecutivo — tradicioninviolada e
inviolable — maxime en el Departamento de Justicia y en la Fiscalia General, el
inhibirse de expresar algunaopinion sobre un asunto ya sometido a los tribunales,
excepto cuando venian llamados a hacerlo, en representaciondel gobierno, en los
tramites de un litigio, civil o criminal,propiamente planteado ante dichos tribunales.
Fuera deestos casos, la inhibicion era tradicionalmente absoluta,observada con la
devocion y la escrupulosidad de un rito.Y la razon era muy sencilla: hamas se queria
estorbar nientorpecer la funcion de los tribunales de justicia, loscuales, bajo la carta
organica y las leyes, tenian absolutoderecho a actuar con maximo desembarazo,
libres de todaingerencia extraña. Esto se hizo bajo la Ley Cooper; estose hizo bajo la
Ley Jones; y esto se hizo bajo la Ley Tydings-McDuffie, la ley organica del
Commonwealth. Creo que el pueblo filipino tiene derecho a que eso mismo se haga
bajo el gobierno de la Republica, que es suyo, que es de su propia hechura. ¡ No
faltaba mas que los hombres de su propia raza le nieguen lo que no le negaron
gobernantesde otra raza!
No se niega la facultad de supervision que tiene el Departamento de Justicia sobre
las oficinas y dependenciasque caen bajo su jurisdiccion, entre ellas las varias
oficinasde registro de la propiedad en Manila y en las provincias.Tampoco se niega la
facultad que tiene dicho Departamentopara expedir circulares, ya de caracter
puramente administrativo,ya de caracter semijudicial, dando instrucciones,vgr., a los
registradores acerca de como deben desempenarsus funciones. De hecho la circular
num. 14 de 25 deAgosto, 1945, es de esta ultima naturaleza: en ella seinstruye y
ordena a los registradores de titulos que noregistren ni inscriban ventas de propiedad
inmueble aextranjeros, asi sean terrenos residenciales, comerciales oindustriales.
Pero la facultad llega solo hasta alli; fuerade esas fronteras el campo ya es pura y
exclusivamentejudicial. Cuando una determinada circular del Departamentoa los
registradores es combatida o puesta en telade juicio ante los tribunales, ora por
fundamentosconstitucionales, ora por razones meramente legales, ya no esel
Departamento el que tiene que determinar o resolverla disputa, sino que eso compete
en absoluto a los tribunalesde justicia. Asi lo dispone terminantemente el articulo200
del Codigo Administrativo. Segun este articulo, elasunto o disputa debe elevarse en
forma de consulta a la Sala Cuarta del Juzgado de Primera Instancia de Manila.La ley
no confiere ninguna facultad al Departamento deJusticia para enjuiciar y decidir el
caso. Y cuando unaparte no estuviere conforme con la decision de la SalaCuarta, ella
puede alzarse de la sentencia para ante laCorte Suprema. He aqui el texto integro del
articulo 200 del Codigo Administrativo:
SEC. 200. Reference of doubtful matter to judge of fourth branch of Court of
First Instance at Manila. — When the register of deeds is in doubt with
regard to the proper step to be taken or memorandum to be made in
pursuance of any deed, mortgage, or other instrument presented for
registration or where any party in interest does not agree with the register of
deeds with reference to any such matter, the question shall be referred to
the judge of the fourth branch of the Court of First Instance of the Ninth
Judicial District either on the certificate of the register of deeds stating the
question upon which he is in doubt or upon the suggestion in writing of the
party in interest; and thereupon said judge, upon consideration of the matter
as shown by the record certified to him, and in case of registered lands,
after notice to the parties and hearing, shall enter an order prescribing the
step to be taken or memorandum to be made.
Tal es lo que ha ocurrido en el presente caso. Krivenkopresento su escritura de
compraventa al Registrador de laPropiedad de Manila. Este denego la inscripcion
solicitadaen virtud de la prohibicion contenida en la circular num.14. ¿ Que hizo
Krivenko entonces? Elevo acaso el asuntoal Departamento de Justicia? No. Lo que
hicieron susabogados entonces fue presentar una demanda el 23 de Noviembre,
1945, contra el Registrador de Titulos ante laSala Cuarta del Juzgado de Primera
Instancia de Manila,numerandose dicha demanda como consulta num. 1289; ycuando
esta Sala decidio el asunto confirmando la acciondel Registrador, Krivenko trajo a
esta Corte la apelacionque estamos considerando. Tan elemental es esto que enla
misma circular num. 14 se dice que la prohibicion quedadecretada hasta que los
tribunales resuelvan lo contrario. He aqui la fraseologia pertinente de dicha
circularnum. 14:
. . . the registration of said deeds or other documents shall be denied, —
unless and /or until otherwise specifically directed by a final decision or
order of a competent court — and the party in interest shall be advised of
such denial, so that he could avail himself of the right to appeal therefrom,
under the provisions of section 200 of the Revised Administrative Code.
La posicion de la Corte Suprema ante este caso claro ypositivo de intromision
(interference) en sus funciones esde lo mas peculiar. Tenemos en el Reglamento de
losTribunales algunas disposiciones que proveen sancion pordesacato para ciertos
actos de intromision en el ejercicio de lasfunciones judiciales. 2 Pero se preguntara
naturalmente;son aplicables estas disposiciones cuando la intromisionprocede de un
ramo del poder ejecutivo, el cual, como sesabe, en la mecanica de los poderes del
Estado, es — usandoun anglicismo-coigual y coordinado con el poder judicial,maxime
si esa intromision se ha realizado so capa de unacto oficial? Cualquiera, pues, puede
imaginarse la situaciontremendamente embarazosa, inclusive angustiosa enque esta
Corte ha quedado colocada con motivo de esa intromision departamental,
exponiendose a chocar con otropoder del Estado. En casos recientes en que estaban
envueltos otros poderes, esta Corte, estimando dudosa suposicion constitucional,
prefirio adoptar una actitud deelegante inhibicion, de "manos fuera" (hands-off), si
bienhay que hacer constar que con la fuerte disidencia dealgunos Magistrados, entre
ellos el opinante.3 Tenemos, portanto, un caso de verdadera intromision en que
siendo, porlo menos, dudosa la facultad de esta Corte para imponeruna sancion por
desacato de acuerdo con el Reglamento delos Tribunales, le queda el unico recurso
decente, ordenado:registrar su excepcion sin ambages ni eufemismos contrala
intromision, y reafirmar con todo vigor, con toda firmezasu independencia.
Se arguye con tenaz persitencia que debiamos de haberconcedido la mocion de
retirada de la apelacion, por dosrazones: (a) porque el Procurador General estaba
conformecon dicha retirada; (b) para evitar la resolucion delpunto constitucional
envuelto, en virtud de la practica,segun se dice, de soslayar toda cuestion
constitucionalsiempre que se pueda. Respecto de la primera razon serasuficiente
decir que el Procurador General es libre de entraren cualquiera transaccion sobre un
asunto en que interviene,pero es evidente que su accion no ata no obliga aesta Corte
en el ejercicio de la discrecion que le confierela regla, 52, seccion 4, del Reglamento
de los Tribunales,que reza como sigue:
Rule 52, SEC. 4 — An appeal may be withdrawn as of right at any time
before the filing of appelle's brief. After that brief is filed the withdrawal may
be allowed by the court in its discretion. . . . (Las cursivas son nuestras.)
Como se ve, nuestra discrecion es absoluta:no estacondicionada por la conformidad o
disconformidad de una delas partes. Y la incondicionalidad de esa discrecion es
masabsoluta e imperativa alli donde el litigio versa sobre unamateria queno afecta
solo a un interes privado, sino quees de interes publico, como el caso presente en
que el Procurador General ha transigido no sobre un asunto suyopersonal o de un
cliente particular, sino de un cliente demucha mayor monta y significacion — el pueblo
filipino — ysiendo materia del litigio la propiedad del suelo, parte, vitalisima del
patrimonio nacional que nuestro pueblo hacolocado bajo la salvaguardia de la
Constitucion.
Respecto del segundo fundamento, o se que debiamospermitir la retirada dela
apelacion para no tener queresolver la cuestion constitucional disputada, bastara
decirque la practica, prinsipio o doctrina que se invoca, llevaconsigo una salvedad o
cualificacion y es que el litigio se pueda resolver de otra mañera. ¿ Podemos soslayar
elpunto constitucional discutido en el pleito que nos ocupa? ¿ Podemos decidirlo bajo
otra ratio decidendi, esto es, queno sea la constitucionalidad o inconstitucionalidad de
laventa del inmueble al apelante Krivenko, en virtud desucondicion de extranjero?
Indudablemente que no: la lis mota, la unica, es la misma constitucionalidad de la
compraventa de que se trata. Para decidir si al recurrido apelado, Registrador de
Titulos de la Ciudad de Manila,le asiste o no razon para denegar la inscripcion
solicitada por el recurrente y apelante, Krivenko, la unica disposicionlegal que se
puede aplicar es el articulo XIII, seccion 5, dela Constitucion de Filipinas, invocado
por el Registrador como defensa e inserto en el parrafo 5 de la circular num.14 como
fundamento de la prohibicion o interdiccion contrael registro de las ventas de terreno
a extranjeros. Nohay otra ley para el caso.
El caso de Oh Cho contra el Director de Terrenos43 Gac. Of., No. 3 pag. 866), que se
cita en unade las disidencias, es completamente diferente. Es verdadque alli se
planteo tambien la cuestion constitucional de quese trata, por cierto que el que lo
planteaba en nombre delGobierno era el actual Secretario de Justicia que
entoncesera Procurador General, y lo pleantaba en un sentido absolumente concorde
con la circular num. 14. Pero esta Corte, con la disidencia de algunos Magistrados,
opto porsoslayar el punot constitucional denegando el registro solicitadopor Oh Cho,
por fundamento de que bajo la LeyNo. 2874 sobre terrenos de dominio publico los
extranjerosestan excluidos de dichos terrenos; es decir, que el terrenosolicitado se
considero como terreno publico. ¿ Podemos hacer la misma evasion en el presente
caso, acogiendonosa la ley No. 2874 o a cualquier otra ley? Indudablemente que no
porque ningun Magistrado de esta Corte, muchomenos los disidentes, consideran el
terreno reclamado por Krivenko como terreno publico. Luego todos los caminosestan
bloqueados para nosotros, menos el camino constitucional.Luego el segundo
fundamento alegado paracubrir la evasiva tambien debe descartarse totalmente.
Se insinua que no debiamos darnos prisa en resolver constitucionalmente el presente
asunto, puesto que puedenpresentarse otros de igual naturaleza en tiempo no
remoto,y en efecto se cita el caso de Rellosa contra Gaw Chee Hun(49 Off. Gaz.,
4345), en que los alegatos de ambas partesya estan sometidos y se halla ahora
pendiente de decision.Es evidente que esto tampoco arguye en favor de la evasiva,en
primer lugar, porque cuando se le somete el deber de iraveriguando en su Escribania
si hay casos de igual naturaleza, sino que los casos se someten por orden de
prelaciony prioridad de tiempo a medida que esten preparados paracaso debe
decidirse por sus propios meritos y conforme ala ley pertinente. La salvedad o
cualificacion de la doctrinao practica que se invoca no dice: "hay qoe soslayar la
cuestionconstitucional siempre que se pueda resolver
de otra manera, reservando dicha cuestion constitucional para otro caso; la salvedad
es dentro del mismo caso. De otro modono seria un simple soslayo legal, sino que
seria unsub terfugio impropio, indebido, ilegal. En el presente caso no ha habido
ninguna prisa, excesivo celo, como se insinua;desde luego no mayor prisa que en
otros asuntos. Elcurso, el ritmo de los tramites ha sido normal; en realidad,si ha
habido algo, ha sido un poco de parsimonia, lentitud.
¿ Habia justificacion para demorar el pronto, rapido pronunciamento de nuestro
veredicto sobre la formidablecuestion constitucional debatida, por lo menos, tan
pronto como fuese posible? ¿ Habia alguna razon de interespublico para justificar una
evasiva? Absolutamenteninguna. Por el contrario, nuestro deber ineludible,
imperioso,era formular y promulgar inmediatamente ese veredicto. Lo debiamos a
nuestras conciencias; lo debiamos, sobretodo, al pais para la tranquilidad y
conveniencia de todos — del pueblo filipino y de los extranjeros residentes o
quetuvieren voluntad de residir o negociar en estas Islas. Asicada cual podria hacer
su composicion de lugar, podriaorientarse sin zozobras ni miedo a la incertidumbre.
Tantonacionales como extranjeros sabrian donde invertir sudinero. Todo lo que
necesitabamos era tener dentro de esta Corte una provee la interdiccion de que se
trata. Tuvimosesa mayoria cunado se voto por primera vez este asuntoen Febrero de
este año (8 contra 3); la tuvimos cuandodespues de laboriosas deliberaciones quedo
denegada lamocion de retirada de la mayoria haya cambiado de opinionsobre el
fondo de la cuestion; la tenemos ahora naturalmente.Por tanto, nada hace falta ya
para que se de lasenal de "luz verde" a la promulgacion de la sentencia.Toda evasiva
seira neglignecia, desidia. Es mas: seriaabandono de un deber jurado, como digo en
otra parte deesta concurrencia; y la Corte Suprema naturalmente npha de permitir
que se la pueda proferir el cargo de queha abandonado su puesto privilegiado de
vigia, de centinela avanzado de la Constitucion.
No es que la Corte Suprema, con esto, pretenda tener"un monopolio de la virtud de
sostener y poner en vigor,o de suplir una deficiencia en la Constitucion," o que
segobierno, como se insinua en una de las disidencias. Nohay tal cosa. El principio de
la supremacia judicial no esuna pretension ni mucho menos un ademan de
inmodestiao arrogancia, sino que es una parte vital de nuestrasinstutuciones, una
condicion peculiarisima de nuestro sistema de gobierno en que la judicatura, como
uno de lostres poderes del Estado, corresponde la facultad exclusivade disponer de
los asuntos judiciales. Con respecto a losasuntos de registro particularmente esa
facultad exclusivano solo se infiere del principio de la supremacia judicial, sino que,
como ya se ha dicho en otra parte de esta concurrencia,se halla especificamente
estutuida en el articulo 200del Codigo Administrativo transcrito arriba. Este
articuloconfiere jurisdiccion exclusiva a los tribunales de justiciapara decidir las
cuestiones sobre registro, y esto lo ha reconocido el mismo Departamento de Justicia
en su circularnum. 14 al referir tales cuestiones a la determinacion oarbitrio judicial en
casos de duda o litigio.
Es injustificada la insinuacion de que, al parecer, la mayoria denego la retirada de la
apelacion no tanto para resolver el asunto en su fondo o por sus meritos, como
paraenrvar los efectos de la circular num. !28 del Departamentode Justicia, pues
Krivenko, el apelante, habriaganado entonces su pleito no en virtud de una
sentenciajudicial, sino pasando por la puerta trasera abierta por esacircular. Tampoco
hay tal cosa. Ya repetidas veces seha dicho que el presente asunto se habia votado
muchoantes de que se expidiese esa circular. Lo que mascorrectamente podria
decirse es que antes de la expedicion deesa desafortunada circular poderosas
razones de interespublico aconsejaban que se denegase la retirada de la apelacion y
se diese fin al asunto mediante una sentencia enel fondo, despues de la expidicion
esas razones quedaroncentuplicadas. La explicacion es sencilla: nuestra
aquiescenciaa la reirada hubiera podico interpretarse entoncescomo que nuestra
jurisdiccion. Es mas: hubiera podidointerpretarse como una abyecta rendicion en la
pugna porsostener los fueros de cada ramo coigual y coordinado del gobierno.
Es todavia mas injustificada la insinuacion de que ladenegacion de la retirada de la
apelacion equivale "a asumir queel solicitante-apelante y el Procurador General
sehan confabulado con el Departamento de Justicia no solopara ingerirse en las
funciones de esta Corte, sino paraenajenar el patrimonio nacional a los extranjeros."
Estoes inconcebible. La corte presume que todos han obradode buena fe, de acuerdo
con los dictados de su conciencia.Se ha denegado la retirada de la apelacion por
razonespuramente juridicas y objectivas, sin consideracion a losmotivos de nadie.
Por ultimo, estimo que debe rectificarse la asercion de queel Magistrado Hontiveros
fue excluido de la votacion queculmino en un emmpate y que determino el
rechazamientode la retirada de la apelacion, a tenor de la regla 56, seccion2,
Reglamento de los Tribunales. El Magistrado Hontiverosno estaba presente en la
sesion por estar enfermo;pero estaban presentes 10 Magistrados, es decir, mas queel
numero necesario para formar quorum y para despacharlos asuntos. La rueda de la
justicia en la Corte Supremajamas ha dejado de rodar por la ausencia de uno o
dosmiembros, siempre que hubiese quorum. A la votacionprecedieron muy laboriosas
y vivas deliberaciones. Ningun Magistrado Ilamo la atencion de la Corte hacia la
ausencia del Sr. Hontiveros. Ningun Magistrado pidio que se leesperase o llamase al
Sr. Hontiveros. Todos se conformaroncon que se efectuase la votacion, no obstante
la ausencia del Sr. Hontiveros. En efecto, se hace la votaciony resulta un empate, es
decir, 5 contra 5. De acuerdo conla regla 56, quedaba naturalmente denegrada la
mocion deretirada. ¿Donde esta, pues, la "ilegalidad", donde la"arbitrariedad"?
Algunos dias despues se presento una mocion de reconsideracion,la misma en que
ya se alegaba como ndamentoel hecho de que la cuestion era simplemente
academica (moot question) por la conformidad del Procurador Generalcon la retirada
y por la circular num. !28 del Departamento de Justicia. Tampoco estaba presente el
Sr. Hontiverosal someterse la mocion, la cual fue de nuevo denegada.Pregunto otra
vez: ¿donde esta la "arbitrariedad"? Queculpa tenia la Corte de que el Sr. Hontiveros
no pudieraestar presente por estar enfermo? ¿Iba a detenerse larueda de la justicia
por eso? Conviene, sin embargo, hacerconstar que sobre el fondo de la cuestion el
Sr. Hontiverosera uno de los 8 que habian votado en favor de la confirmacion de la
sentencia apelada, es decir, en favor delveredicto de que la Contitucion excluye a los
extrajerosde la propiedad de bienes raices en Filipinas.
II. No queda casi nada decir sobre el fondo de lacuestion. Todos los angulos y fases
de la misma estanacabadamente tratados y discutidos en la ponencia. Melimitare, por
tanto, a hacer unas cuantas observaciones,unas sobre hermeneutica legal, y otra
sobre historia nacionalcontemporanea, aprovachando en este ultimo respectomis
reminiscencias y mi experiencia como humilde miembroque fui de la Asamblea
Constituyente que redacto y arobola Constitucion de Filipinas.
Toda la cuestion, a mi juicio, se reduce a determinar einterpretar la palabra "agricola"
(agricultural) usada enel articulo XIII, seccion 5, de la Constitucion. He aqui eltexto
completo de la seccion:
SEC. 5. — Save in cases of hereditary succession, no private agricultural
land shall be transferred or assigned except to individuals, corporations, or
associations qualified to acquire or hold lands of the public domain in the
Philippines.
¿Incluye la palabra "agricultural" aqui empleada los terrenosresidenciales,
comerciales e industriales? Tal es lacuestion: la mayoria de esta Corte que si; los
disidentesdicen que no.
Es indudable que por razones sanas de hermenuetica legalel articulo XIII de que se
trata debe interpretarse como untodo homogeneo, simetrico. En otras palabras, los
cocablosalli empleados deben interpretarse en el sentido de quetienen un mismo
significado. Es absurdo pensar o suponerque en el texto de una ley, sobre todo dentro
del estrechomarco de un articulo, un vocablo tenga dos o mas significadosdistintos, a
menos que la misma ley asi to diga expresamente. Lapresuncion es que el legislador
sigue y seatiene a las reglas literarias elementales.
Ahora bien: el articulo XIII consta de dos partes — laprimera, que trata de los terrenos
agricolas de dominiopublico, y la segunda, que se a los terrenos agricolaprivados o
partuculares.
La primera parte se compone de las secciones 1 y 2que vinculanla propiedad de los
terrenos publicos enel Estado y disponen que solo se pueden enajenar a favorde
ciudadanos filipinos, o de corporaciones o asociacionesen que el 60 por ciento del
cacital, por lo menos, pertenecea tales ciudadanos. En secciones se emplea
literalmentela frase "public agricultural land."
La segunda parte la componen las secciones 3 y 5: laseccion 3 perceptua que "the
Congress may determine bylaw the size of private agricultural land which
individuals,coporations, or associations may acquire and hold, subjectto rights existing
prior to the enactment of such law"4 ;y la seccion 5 es la que queda transcrita mas
arriba y esobjeto del presente litigio. En ambas secciones se emplealiteralmente la
frase "private agricultural land."
No hay ninguna cuestion de que la frase "public agriculturalland" empleada en la
primera parte comprende terrenosresidenciales, comerciales e industriales; lo
admitenlos mismos abogados del apelante y los Sres. Magistradosdisidentes. Y ¿por
que lo admiten? Sera porque en laConstitucion se define la palabra "agricultural"
aplicadaa terrenos publicos, en el sentido de incluir solaresresidenciales, comerciales
e industriales? Indudablementeque no, porque en ninguna parte de la Constitucion se
datal definicion. Lo admiten porque en esta jurisdicciontenemos una serie consistente
de sentencias de esta CorteSuprema en que es jurisprudencia firmamente
establecidala doctrina de que la palabra "agricultural" usada en laLey del Congreso de
los Estados Unidos de 1902 (LeyCooper) y en nuestras leyes de terrenos publicos
comprendey abarca solares residenciales, comerciales, industriales yqualquier otra
clase de terrenos, excepto forestales yminerales.5 Es decir, que se aplica a la actual
Constitucion deFilipinas una interpretacion clasica, tradicional, embebidaen nuestra
jurisprudencia de cerca de medio siglo.
Ahora bien, pregunto: si la palabra "agricultural" empleadaen la primera parte del
articulo XIII tiene talsignificado — y lo tiene porque la Constitucion no da otrodiferente
— ¿por que esa misma palabra empleada en lasegunda parte, unas cuantas lineas
mas adelante, no hade tener el mismo significado? ¿Da acaso la Constitucionuna
definicion de la palabra "agricultural" cuandose refiere a terreno privado? ¿Donde
esta esa definicion? ¿O es que se pretende que la diferenciacion opera no envirtud de
la palabra "agricultural", sino en virtud delvocablo "public" o "private", segun que se
trate de terrenopublico o privado?
Si la intencion de la Asemblea Constituyente fuera eldar a la palabra "agricultural"
aplicada a terreno privadoun significado distinto de cuando se refiere a terreno
publico, lo hubiese hecho constar asi expresamente en elmismo texto de la
Constitucion Si, como se admite, laAsemblea opto por no definir la palabra
"agricultural"aplicada a terreno poblico porque contaba para ello con ladefinicion
clasica establecida en la jurisprudencia, cuandola misma Asemblea tampoco definio
la palabra con relaciona terreno privado, es logico inferir que tuvo la mismaintencion,
esto es, aplicar la definicion de la jurisprudenciaa ambos tipos de terreno — el publico
y el privado. Pensarde otra manera podria ser ofensivo, insultante; podriaequivaler a
decir que aquella Asemblea estaba compuestade miembros ignorantes,
desconocederos de las reglas elementalesen la tecnica de redaccion legislativa.
Tuve el honor de partenecer a aquella Asemblea comouno de los Delegados por
Cebu. Tambien me cupo elhonor de partenecer al llamado Comite de Siete —
elcomite encargado finalmente de redactar la ponencia dela Constitucion. No digo que
aquella Asemblea estabacompuesta de sabios, pero indudablemente no era inferiora
ninguna otra de su tipo en cualquiera otra partedel mundo. Alli habia un plantel de
buenos abogados,algunos versados y especialistas en derecho constitucional.Alli
estaba el Presidente de la Universidad de FilipinasDr. Rafael Palma; alli estaba el
propio Presidentede la Asemblea Constituyente Hon. Claro M. Recto, conlos
prestigios de su reconocida cultura juridica y humanista; alli estaba tambien el Dr.
Jose P. Laurel, considerado comouna de las primeras autoridades en derecho
constitucionaly politico en nuestro pais. En el Comite de Siete o dePonencia figuraban
el actual Presidente de Filipinas Hon.Manuel Roxas; el ex-Senador de Cebu Hon.
Filemon Sotto;el Hon. Vicente Singson Encarnacion, lider de la minoria en la primera
Asemblea Filipina, ex-miembro de la Comisionde FIlipinas, ex-Senador y ex-
Secretario de Gabinete;el ex-Magistrado de la Corte Suprema Hon.
NorbertoRomualdez; el actual Secretario de Hacienda Hon. MiguelCuaderno; y el ex-
Decano del Colegio de Artes Liberalesde la Universidad de Filipinas, Hon. Conrado
Benitez.
No se puede concebir como bajo la inspiracion y guiade estas personas pudiera
redactarse el texto de un articuloenque un vocablo — el vocablo "agricultural" —
tuviera dosacepciones diferentes: una, aplicada a terrenos publicos;y otra, aplicada a
terrenos privados. Menos se concibeque, si fuese esta la intencion, se incurriese en
una comisionimperdonable: la omision de una definicion especifica, diferenciadora,
que evitase caos y confusion en la mente delos abogados y del publico. Teniendo en
cuenta la innegablecompetencia de los Delegados a la Asemblea Constituyentey de
sus liders, lo mas logico pensar es que alno definir la palabra "agricultural" y al no
diferenciarsu aplicacion entre terrenos publicos y privados, lo hicierondeliberamente,
esto es, conla manifiesta intencion dedejar enteramente la interpretacion de la palabra
a la luzde una sola comun definicin — la establecida en la jurisprudenciadel asunto
tipico de Mapa contra Gobierno Insular y otrossimilares (supra); es decir, que la
palabra "agricultural",aplicada a terrenos privados, incluye tambien
solaresresidenciales, comerciales, e industriales.
A word or phrase repeated in a statute will bear the same meaning
throughout the statute, unless a different intention appears. . . . Where
words have been long used in a technical sense and have been judicially
construed to have a certain meaning, and have been adopted by the
legislature as having a certain meaning prior to a particular statute in which
they are used, the rule of construction requires that the words used in such
statute should be construed according to the sense in which they have been
so previously used, although that sense may vary from the strict literal
meaning of the words." (II Sutherland, Stat. Construction, p. 758.)
Pero acaso se diga que la Asemblea Constituyente hadejado sin definir la palabra
"agricultural" referente aterreno particular, dando a entendar con su silencio
queendosaba la definicion al diccionario o a la usanza popular.La suposicion es
igualmente insostenible. ?Por queen un caso se entrega la definicion a la
jurisprudencia,y por que en otro al diccionario, o al habla popular?Aparte de que los
miembros y dirigentes de la AsembleaConstituyente sabian muy bien que esto
causaria unatremenda confusion. Ni los diccionarios, ni mucho menosel lenguaje
popular, ofrecen apoyo seguro para una fiely autorizada interpretacion. Si el texto
mismo de la ley,con definiciones especificas y casuisticas, todavia ofrecedudas a
veces ¿como no el lexico vulgar, con su infinitavariedad de matices e idiotismos?
Ahora mismo ¿no estamos presenciando una confusionn,una perplejidad? ¿Hay
acaso uniformidad en la definicionde lo que es un terreno privado agricola? No;
cadacual lo define a su manera. Uno de los disidentesel Magistrado Sr. Tuason toma
su definicion de la palabra "agricultural " del Diccionario Internacional de Webster que
dice . . . "of or pertaining to agricultural connected with, or engaged in, tillage; as the
agricultural class; agricultural implements, wages etc." Tambien hacereferncia el
mismo Magistrado al concepto popular. Otrodisidente el Magistrado Sr. Padilla dice
que "the termprivate agricultural land means lands privately owneddevoted to
cultivation, to the raising of agriculturalproducts." El Magistrado Sr Paras no da
ninguna definicion;da por definida la palabra "agricultural", al parecer, segunel
concepto popular.
Pero, sobre todo, los abogados del apelante definen elvocablo de una manera
distinta. Segun ellos, "land spoken of as `agricultural' naturally refers to land not only
susceptible of agricultural or cultivation but more valuable for such than for another
purpose, say residential,commercial or educational. . . . The criterion is notmere
susceptibility of conversion into a farm but its greater value when devoted to one or
the other purpose." Demode que, segun esta definicion, lo que determina la
calidaddel terreno es su valor relativo, segun que se dedique alcultivo, o a residencia,
o al comercio, o a la industria.Los autores de esta definicion indudablemente tienen
encuenta el hecho de que en las afueras de las ciudades existenterrenos immensos
que desde tiempo inmemorial se handedicado a la agricultura, pero que se han
convertido ensubdivisiones multiplicandose su valor en mil por cientosi no mas. De
hecho esos terrenos son agricolas; comoque todavia se ven alli los pilapiles y ciertas
partes estancultivadas; pero en virtud de su mayor valor para residencia,comercio e
industria se les aquiere colocar fuera dela prohibicion constitucional. En verdad, el
criterio nopuede ser mas elastico y convencional, y denota cuanincierta y cuan
confusa es la situacion a que da lugar latesis del apelante y de los que le sostienen.
Si hubieramos de hacer depender la definicion de loque es un terreno agricola del
concepto popular y de losdiccionarios, asi sean los mejores y mas cientificamente
elaborados ¿que normas claras, concretas y definitivasde diferenciacion podrian
establecerse? ¿Podrian trazarsefronteras inconfundibles entre lo que es agricola y lo
quees residencial, comercial e industrial? ¿Podria hacerseuna clasificacion que no
fuese arbitraria? Indudablementeque no. El patron mas usual de diferenciacion es
lanaturaleza urbana o rural del terreno; se considera comoresidencial, comercial e
industrial todo lo que esta dentrode una urbe, ciudad o poblacion. Pero ¿resolveria
esto la dificultad? Proporcionaria un patron exacto, cientifico,no arbitrario? Tampoco.
Por que dentro de una ciudado poblacio puede haber y hay terrenos agricolas.
Comodijo muy bien el Magistrado Sr. Willard en el asunto clasico de
Mapa contra Gobierno Insular, "uno de los inconvenientes de la adopcion de este
criterio es que es tanvago e indeterminado, que seria muy dificil aplicarlo enla
practica. ¿Que terrenos son agricolas por naturaleza? l mismo Fiscal General, en su
alegato presentado en este asunto, dice: 'La montaña mas pedregosa y el suelo mas
pobre son susceptible de cultivo mediante la mano del hombre'" (Mapa contra Insular,
10 Jur. Fil.,183). Y Luego el Sr. Willard añade las siguietes observacionessumamente
petinentes e ilustratives para una correctare solucion del asunto que nos ocupa, a
saber:
. . . Tales terrenos (agricolas, quiere decir) se pueden encontrar dentro de
los limites de cualquier ciudad. Hay dentrode la ciudad de Manila, y en la
parte densamente poblada de lamisma, una granja experimental. Esta es
por su naturaleza agricola. Contigua a la Luneta, en la misma ciudad, hay
una gran extension de terreno denominado Camp Wallace, destinada
a sports. El terreno que circuda los muros de la ciudad de Manila, situado
entre estos y el paseo del Malecon por el Sur y Este contiene muchas
hectareas de extension y es de naturaleza agricola. La Luneta misma
podria en cualquier tiempo destinarse al cultivo.
La dificultad es mayor tratanndose de diferenciar unterreno agricola de un terreno
industrial. En este respectoes preciso tener en cuenta que un terreno industiralno
tienee que ser necesariamente urbano; en realidad,la tendencia moderna es a situar
las industrias fuera deas ciudades en vastas zonas rurales. Verbigracia; anpredor de
la famosa cascada de Maria Cristina en Lanao existen grandes extensiones de
terreno agricola, algunasde propiedad particular. Cuando, se industrialice
aquellaformidable fuerza hidraulica bajo el llamado Plan Beyster ¿que normas
segfuras se podrian establecer para poner envigor la prohibicion constitucional fuese
burlada enajenandosetierras agricolas de propiedad privada a favorde extranjeros, ya
sean individuos, ya sean corporacioneso asociaciones, so pretexto de ser
industriales?
Resulta evidence de lo expueto que los redactores denuetra Constitucion no
pudienron haber tenido la idea deque el articulo XIII fuera interpretado a la luz de ese
criterio vago e indeterminado que llama el Sr. Willard. Es mas logico pensar que el
criterio que ellos tenian enla mente era el criterio establicido en la jurisprudencia
sentada en el asunto clasico de Mapa contra Gobierno y otros asuntos concomitantes
citados — criterio mas frime, mas seguro, menos expuesto a confusion y
arbitrariedad, y sobre todo, "que ofrece menos inconvenientes", parafraseando otra
vez al Magistrado Sr. Willard, (supra, p. 185).
Otro serio inconveniente, La seccion 3, articulo XIIIde;la Constitucion, dispone que "el
Congreso puedo determinarpor ley l;a eextension superficial del terrenoprivado
agricola que los individous, corporaciones o asociaciones pueden adquirir y poseer,
sujeto a los derechos existentes antes de la aprobacion de dicha ley." Si
seinterpretase que la frase "private agricultural land" noincluye terrenos residenciales,
comerciales e industriales,entonces estas ultimas clases de yterreno quedarian
excluidas de la facultad reguladora concedida por la Constitucion al Congreso
mediante dicha seccion 3. Entoncesun individuo o una corporacion podrian ser
dueños de todoslos terrenos de una ciudad; no habria limite a las adquisicionesy
posesiones en lo tocante a terrenos residenciales,comerciales e industriles. Esto
parece absurdo, peroseria obligada consecuencia de la tesis sustentada por
elapelante.
Se hace hincapie en el argumento de que el el procesode tamizacion del articulo XIII
durante las deliberacionesde la Asamblea Constituyente y de los Comites de
Ponnnnenciay de estilo al principio no figuraba el adjetivo "agricola"en la seccion 5,
diciendose solo "terreno privado" y quesolo mas trade se añadio la palabra calificativa
agricola—"private agricultural land" De este se quiere inferir quela adicion de la
palabra "agricultural" debio de ser poralgun motivo y este no podia ser mas que el de
que sequiso excluir los terrenos residenciales comerciales e industriales, limitandose
el precepto a los propia o estrictamenteagricolas.
La deduccion es incorrecta y sin fundamento. No cabedecir que la adicion de la plabra
"agricultural" en estecaso equivale a excuir los terrenos residenciales, comercialese
industriales, por la sencilla razon de que la Constitucion no solo no define lo que
es residencial comercial e industrial, comercial e industrial. En cambio ya hemosvisto
que la palabra "agricultral" tiene una significaciontradicionalmente bien establecida en
nuestra jurisprudenciay en nuestro vocabulario juridico: incluye no solo
terrenoscultivados o susceptibles fe cultivo, sino tambien residencialescomerciales e
industriales. Se admite por todo elmundo que la palabra tiene tal significacion en el
articuloXIII, seccion 5, de la Constitucion, en cuanto se refierea terreno publico. Ahora
bien; ¿que diferencia hay, despuesde todo, entire un terreno publico agricolo y uno
sea a la calidad de agricola, absolutamente ninguna.Uno no es mas menois agricola
que el otro. La unicadiferencia se refiere a la propiedad, al titulo dominical — en que
el uno es del Estado y el otro es de un particular.
En realidad, creo que la diferencia es mas bien psicologica,subjetiva — en que
vulgarmente hablando pareceque los conceptos de "agricola" y "residencial" se
repelen.No se debe menospreciar la influencia del vulgo en algunascosas; en la
misma literatura el vulgo juega su papel; digasi no la formacion popular del
romancero. Pero es indudable que cietas cosas estan por encima del conceptovulgar
— una de estae la interpretacion de la leyes, lahermeneutica legal. Esto no es
exagerar la importancia de la tecnica sino que es simplemente colocar las cosasensu
verdadero lugar. La interpretacion de la ley es unafuncion de minoria — los abogados.
Si no fuera asi paraque los abogados? ¿Y para que las escuelas de dercho,y para
que los exmenes, cada vez mas rigidos, para de purar el alma de la toga, que dijo un
gran abogado español?6 Asi que cuando decimos que el precepto constitucional en
cuestion debe interpretatarse tecnicamente, a la luz de la jurisprudencia, por ser ello
el metodo mas seguro para hallar la verdad judicial, no importa que ello repugne al
concepto vulgar a simple vista, no ponemos,en realidad, nionguna pica en Flandes,
sino que propugnamos una cosa harto elememntal por lo sabida.
Por tanto no es necesario especular o devanarse lossesos tratando de inquirir por que
en la tamizacion delprecepto se añadio el adjetivo 'agricultural" a las palabras"private
land" en vez de dejarlas solas sin cualificacion.Algunos diran que fue por razon de
simentria para hacer"pendant diran que fue por razon de simetria para
hacer"pendant" con la frase "public agricultural land" puestamas arriba. Pero esto np
tiene ninguna importancia. Loimportante es saber que la añadidura, tal como esta
jurisdiccion, de la palbra "agricultural" empleada en dicho texto. Eso es todo; lo demas
creo que es puro bizantinis mo.
III. Cero que una examen de los documentos y debatesde la Asamblea Constituyente
para ver de inquirir la motivacion y finalidad del precepto constitucional que nos
ocupapuede ayudar grandemente y arrojar no poca luz en lainterpretacion de la letra
y espiritu de dicho precepto.Este genero de inquisicion es perfectamente propio y
permisible en hermeneutica constitucional, y se ha hechosiempre, segun las majores
autoridades sobre la materia. Cooley, en su authorizado tratado sobre Limitaciones
Constitucionales (Constitutional Limitations) dice a este efectolo sigiuente:
When the inquiry is directedto ascertaining the mischief designed to be
remedied, or the purpose sought to be accomplished by a particular
provision, it may be proper to examine the proceedings of the convention
which framed the instrument. Where the proceedings clearly point out the
purpose of the provision, the aid will be valuable and satisfactory; but where
the question is one of abstract meaning, it will be difficult to derive from this
 source much reliable assistance in interpretation. (1 Cooley on
Constitutional Limitations [8th ed.], p. 142.)
¿Que atmosfera prevalecia en la Asamblea sobre elproblema de la tierra en general
sobre el problema capitalismo de los terrenos naturales? ¿Cual era la
tendenciapredominante entre los Delegados? Y ¿como era tambienel giro de la
opinion, del sentimiento publico es decir comoera el pulso del pueblo mismo del cual
la Asamblea despuesde todo no era mas que organo e interprete?
Varios discursos sobre el particular se pronounciaronen la Asamblea Constituyente.
El tono predomionante entodos ellos era un fuerte, profundo nacionalismo. Tanto
dentro como fuera de la Asamblea Constituyente era evidente, acusado, el afan
unanime y decidido de conservar el patrimonio nacional no solo para las presentes
generaciones filipinas, sino tambien para la posteridad. Y patrimonio nacional tenia,
en la mente de todos un significadocategorio e indubitable; significion de si es
dedominio publico o privado. Muestras tipicas y representativas de este tono pecular y
dominantes de la ideologiaconstituyente son ciertas m,anifestaciones que constanen
el diario de serines has en el curso de los debateso en el proceso de la redaccion del
proyecto constitucionalpor Delegados de palabra autorizadam bien por su
significacion personal bein por el papel particula que desempeñaban en las treas
constituyentes. Por ejemplo el Delegado Montilla por Negros Occidental, conspicuo
representante del agro, usando del privilegio de madia horaparlamentaria dijo en
parte lo siguinte:
. . . Con la completa nacionnalization de nuestras tierras y recursos natural
debe entenderse que nuetro patrimonio nacional debe estar vinculado 100
por 100 en manos filipinas. Tierras y recursos naturales son inm,uebles y
como tales pueden compararse con los organos vitales del cuerpo de una
persona: la falta de posesion de los mismo puede caussar la muete
instantannea o el abreviamiento de la vida (Diario de Sesiones Asamblea
Constituyente, inedita, "Framing of the Constitution," tit. 2 0 pag. 592 Libro
del Profesor Aruego).
Como se ve el Delegado Montilla habla de tierras sin adjetivacion, es decir sin
difenciar entre propiedad publica y privada.
El Delgado Ledesma, por Iloilo, otro conspicuo representante del agro presidente del
comte de agricultura de la Asamblea que los extramnjeros no podian ser mismas
palabras:
La exclusion de los extranjeros del privilegio de adquirir terrenos publicos
agricolas y de poder se dueños de propiedades inmuebles (real estate) es
una parte necesaria de las leyes de terrenos publicos de Filipinas para
mantener firme la idea de conservar Filipinaspara los filipos' (Diario de
Sesiones, id.; Libro de Aruego, supra, pag. 593.)
Es harto significtativo que en el informe del Colite de Nacionalizacion y Conservacion
de Recursos Naturales de la Asamblea Constituyente la plabra tierra (land) se usa
generricamente sin cualificacion de publica o privada. Dice el Comite:
Que la tierra, los minerales los bosques y otros recursos
naturalesconstituyen la herencia exclusiva de la nacion filipina. Deben,por
tanto, ser conservados para aquellos que se halian bajo la autoridad
soberana de esa nacion y para su posteridad. (Libro de Aruego, supra, pag.
595.)
La conservacion y fomento del patrimonio nacional fue una verdadera obsesion en la
Asamblea Constituyente. Sus mienbros que todavia viven recordaran l;a infinita
paciencia, el esmero de orfe breria con que se trabajo el preambulo de la
Constitucion. Cada frase, cada concepto se sometio a un rigido proceso de seleccion
y las gemas resultans es la labor benedictina una de las gemas redel patrimonio
nacional. He aqui el preambulo:
The Filipino people, imploring the aid of Divene Providence,in order to
establish a government that shall enbody their ideals, conserve and develop
the patrimony of the nation, promote the general welfare, and secure to
themslves and their posterity the blessings of independence under a regime
of justice, liberty, and democracy, do ordain and promulgate this
Constitution.
El espiritu fuertemente nacionalista que saturaba la Asamblea Constituyente con
respecto a la tierre y recursosnaturales es de facil explicacion. Estabamos
escribiendouna Constitucion no solo para el Commonwealth, sino tambien para la
republica que advendria despues de10 años. Querianos, puesd asegurar firmemente
las basesde nuestra nacionalidad. ¿Que cosa major para ello quebildar por los cuatro
costrados el cuerpo dela mnacion delcual — parodiando al Delegado Montilla — la
tierra y losresoursos naturales son como organos vitales cuya perdidapuede causar la
muerte instantanea o el abreviamiento dela vida?
Para aprociar el pulso de la nacion en aquel memontohistorico es preciso tener en
cuenta las cirucmstancias.Nos debamos perfecta cuenta de nuetra posicion
geografica,asi como tambien de nuestras limitaciones demograficas.Se trataba, por
ciento de una conciencia agudamenteatormentadora y alarmante. Estabamos
roodeadosde enormes mesas humanas — centenares de milliones — economica y
biologicamente agresivas, avidad de desbordarsepor tadas partes, poir las areas del
Pafico particularmente,en busca de espacio vitales. China, Japon-Japon, sobretodo
que estaba entonces en el apogeo de su delirio deengrandecimiento economico y
militarista. Teniamos apantadoal mismo corazon, como espada rutilante de
Samurrai,el pavoroso problema de Davao, donde, por errores incialesdel Gobierno,
Japon tenia el control de la tierra, instituyendos alli una especie de Japon en
miniatura, con todaslas amenasas y peligros que ello implicaba para la integridadde
nuestra existancia nacional. Como que Davaoya se llamaba popular y
sarcasticamente Davaoko, entragica rima con Manchuko.
Tambien nos obsesionaban otras lecciones dolorosas dehistoria contemporanea.
Texas, Mejico, Cuba y otraspaises del Mar Caribe y de la America Latina que
todaviaexpiaban, como una terrible maldicion el error de susgobernantes al permitir la
enajenacion del suelo a extranjeros.
Con el commercio y la industria principalmente en manosno-filipinas, los Delegados a
la Constituyente se haciancargo tambien de la vitalisima necesidad de, por lo
menos,vincular el apatrimonio nacional, entre otras cosas la tierra, en manos de los
filipinos.
Que de extraño habia, pues, que en semejante atmosfera y tales circumstancias se
aprobase un articulo rigidamentenacionalismta como es el Article XIII? La motivacion
y finalidad, como ya se ha dicho, era triple: (a)consetvar el patrimonio nacional para
las presentes yfuturas generaciones filipinas; (b) vincular, por lo menos,la propiedad
de la tierra y de los recursos naturales en manos filipinas como la mejor manera de
mantener elequilibrio de un sistema economico dominado principalmente por
extranjeros en virtud de su tecnica (know-how) superior y de su abudancia de
capitales: (c) prefictos y complicaciones internacionales.
No se concibe que los Delegados tuvieran la intercionde excluir del precepto los
terrenos residenciales comercialese industrial, pues sabian muy bien que los finesque
se trataban de conseguir y los peligros quie se trataban de evitar con la politica de
nacionalizacion y conservacionrezaban tanto para una clase de terrenos como para
otra. ¿Por que se iba a temer, verbigracia, el dominio extranjero sobre un terreno
estrictamente, agricola, sujeto a cultivo, y no sobre el terreno en que estuviera
instalada unaformidable industria o fabrica?
Otro detalle significativo. Era tan vigoroso el sentimiento nacionalista en la Asamblea
Constituyente que, noobstante el natural sentimiento de gratitud que nos obligabaa
favor de los americanos., a estos no se les concedioningun privilegio en relacion con
la tierra y demas recusosnaturales, sino que se les coloco en el mismo plano que alos
otros extranjeros. Como que ha habido necesidad deuna reforma constitucional — la
llmada reforma sobre laparidad — para equipararlos a los filipinos.
The mere literal construction of a section in a statute ought not to prevail if it
is opposed to the intention of the legislature apparent by the statute; and if
the words are sufficiently flexible to admit of some other construction it is to
be adopted to effectuate that intention. The intent prevails over the letter,
and the latter will, if possible, be so read as to conform to the spirit of the
act. While the intention of the legislature must be ascertained from the
words used to express it, the manifest reason and the obvious purpose of
the law should not be sacrificed to a literal interpretation of such words. (II
Sutherland, Stat. Construction, pp. 721, 722.)
IV. — Se insinua que no debieramos declarar que laConstitucion excluye a loc
extranjeros de la propiedadsobre terrenos residenciales e industriales,porque ello
imposibilitaria toda accion legislativa en sentidocontrario para el caso de que el
Congreso Ilegagealguna vez a pensar que semejante interdiccio debialevantarse. Se
dice que es majes y mas conveniente dejaresta cuestion en manos del Congreso para
que haya maselasticidad en las soluciones de los diferentes problemassobre la tierra.
Cometeriamos un grave error si esto hicieramos. Estaes una cuestion constitucional
por excelencia. Solamenteel pueblo puede disponer del patrimonio nacional. Ni el
Congreso, ni mucho menos los tribunales, pueden disponerde ese patrimonio. Lo mas
que puede hecer el Congreso es proponer una reforma constitucional mediante los
votosde tres cuartas (3/4) de sus miembros; y el pueblo tienela ultima palabra que se
expresara en una eleccion oplebiscito convocado al efecto.
El argumento de que esto costaria dinero es insostenible. Seria una economia mal
entendida. Si no se escatiman gastos para celebrar elctiones ordinarias
periodicamente ¿como ha del pueblo en un asunto tan vital como es la disposicion del
patrimonio nacional, base de su mismaexistencia? para reformar la Constitucion,
apoyado portres cuartas (3/4) del Congreso, por lo menos.
En el entretanto el articulo XIII de la Constitucion debequedar tal como es, e
interpretarse en la forma como lo interpretamos en nuestra decision.
Se confirma la sentencia.
PARAS, J., dissenting:
Section 5 of Article XIII of the Constitution provides that "save in cases of hereditary
succession, no private agricultural land shall be transferred or assigned except to
individuals, corporations, or associations qualified to acquire or hold lands of the
public domain in the Philippines." The important question that arises is whether private
residential land is included in the terms "private agricultural land."
There is no doubt that under section 1 of Article XIII of the Constitution, quoted in the
majority opinion, lands of the public domain are classified into agricultural, timber,or
mineral. There can be no doubt, also, that public lands suitable or actually used for
residential purposes, must of necessity come under any of the three classes.
But may it be reasonably supposed that lands already of private ownership at the time
of the approval of the Constitution, have the same classification? An affirmative
answer will lead to the conclusion — which is at once absurd and anomalous — that
private timber and mineral lands may be transferred or assigned to aliens by a mode
other than hereditary succession. It is, however, contended that timber and mineral
lands can never be private, and reliance is placed on section 1, Article XIII, of the
Constitution providing that "all agricultural, timber and mineral lands of the public
domain . . . belong to the State," and limiting the alienation of natural resources only to
public agricultural land. The contention is obviously untenable. This constitutional
provision, far from stating that all timber and mineral lands existing at the time of its
approval belong to the State, merely proclaims ownership by the Government of all
such lands as are then of the public domain; and although, after the approval of the
Constitution, no public timber or mineral land may be alienated, it does not follow that
timber or mineral lands theretofore already of private ownership also became part of
the public domain. We have held, quite recently, that lands in the possession of
occupants and their predecessors in interest since time immemorial do not belong to
the Government, for such possession justifies the presumption that said lands had
been private properties even before the Spanish conquest. (Oh Cho vs. Director of
Lands, 43 Off. Gaz., 866.) This gives effect to the pronouncement in Cariño vs. Insular
Government (212 U.S., 446; 53 Law. ed., 594), that it could not be supposed that
"every native who had not a paper title is a trespasser." It is easy to imagine that some
of such lands may be timber or mineral. However, if there are absolutely no private
timber or mineral. However, if there are absolutely no private timber or mineral lands,
why did the framers of the Constitution bother about speaking of "private agricultural
land" in sections 3 and 5 of Article XIII, and merely of "lands" in section 4?
SEC. 3. The Congress may determine by law the size of private agricultural
land which individuals, corporations, or associations may acquire and hold,
subject to rights existing prior to the enactmentof such law.
SEC. 4. The Congress may authorize, upon payment of just compensation,
the expropriation of lands to be subdivided into small lots and conveyed at
cost to individuals.
SEC. 5. Save in cases of hereditary succession, no private agricultural
land shall be transferred or assigned except to individuals, corporations, or
associations qualified to acquire or hold lands of the public domain in the
Philippines.
Under section 3, the Congress may determine by law the size of private agricultural
land which individuals, corporations, or associations may acquire and hold, subbject to
rights existing prior to the enactment of such law, and under section 4 it may
authorize, upon payment of just compensation, the expropriation of lands to be
subdivided into small lots and conveyed at cost to individuals. The latter section
clearly negatives the idea that private lands can only be agricultural. If the exclusive
classification of public lands contained in section 1 is held applicable to private lands,
and , as we have shown, there may be private timber and mineral lands, there would
be neither sense nor justification in authorizing the Congress to determine the size of
private agricultural land only, and in not extending the prohibition of section 5 to timber
and mineral lands.
In may opinion, private lands are not contemplated or controlled by the classification of
public lands, and the term "agricultural" appearing in section 5 was used as it is
commonly understood, namely, as denoting lands devoted to agricultural. In other
words, residential or urban lots are not embraced within the inhibition established in
said provision. It is noteworthy that the original draft referred merely to "private land."
This certainty would have been comprehensive enough to included any kind of land.
The insertion of the adjective "agricultural " is therefore significant. If the Constitution
prohibits the alienation to foreigners of private lands of and kind, no legislation can
ever be enacted with a view to permitting limited areas of land for residential,
commercial, or industrial use, and said prohibition may readily affect any effort
towards the attainment of rapid progress in Philippine economy. On the other hand,
should any danger arise from the absence of such constitutional prohibition, a law may
be passed to remedy the situation, thereby enabling the Government to adopt such
elastic policy as may from time to time be necessary, unhampered by any
inconveniences or difficulties in amending the Constitution. The power of expropriation
is, furthermore, a handy safeguard against undersirable effects of unrestricted
alienation to, or ownership by, aliens of urban properties. The majority argue that the
original draft in which the more general terms "private land" was used, was amended
in the same that the adjective "agricultural" was inserted in order merely "to clarify
concepts and avoid uncertainties" and because, as under section 1, timber and
mineral lands can never be private, "the prohibition to transfer the same, would be
superfluous." In answer, it may be stated that section 4 of Article XIII, referring to the
right of expropriation, uses "lands" without any qualification, and it is logical to believe
that the use was made knowingly in contradistinctions with the limited term "private
agricultural land" in section 3 and 5. Following the line of reasoning of the majority,
"lands" in section 4 necessarily implies that what may be expropriated is not only
private agricultural land but also private timber and mineral lands, as well, of course,
as private residential lands. This of course tears apart the majority's contention that
there cannot be any private timber or mineral land.
Any doubt in the matter will be removed when it is, borne in mind that no less than
Honorable Filemon Sotto, Chairman of the Sponsorship Committee of the
Constitutional Convention, in supporting section 3 of the Article XIII, explained that the
same refers to agricultural land, and not to urban properties, and such explanation is
somewhat confirmed by the statement of another member of the Convention (delegate
Sevilla) to the effect that said section "is discriminatory and unjust with regard to the
agriculturists."
Sr. SOTTO (F) Señor Presidente: "Que hay caballeros de laConvencion en
el fondo de esta cuestion al parecer inocente yordinaria para que tanto
revuelo haya metido tanto en la sesion de ayer como en la de hoy? Que
hay de misterios en el fondo de este problem, para que politicos del
volumen del caballero por Iloilo y del caballero por Batangas, tomen con
gran interes una macion para reconsiderar lo acordado ayer? Voy a ser frio,
señores. Parece que es meyor tratar estas cuestiones con calma y no
apasionamiento. He prestado atencion, como siempre suelo hacer a todos
los argumentos aqui en contra del precepto contenido en el draft y a favor
ahora de la reconsideracion y siento decir lo siguiente; todos son
argumentos muy buenos a posteriori. Cuando la Asamble Nacional se haya
reunido, sera la ocasion de ver si procede o no expropiar terrenos o
latifundios existentes ahorao existentes despues. En el presente, yo me
limito a invitar la atencion de la Convencion al hecho de que el procepto no
tome las medidas necesarias en tiempo oportuno, cuando el problema del
latifundismo se haya presentado con caracterres tales que el beinestar,
interes y orden publico lo requieran. Permitame la Convencion que lo
discuta en globo las dos pates del articulo 9. Hay tal engranaje en los dos
mandatos que tiene dicho precepto, hay tral eslabon en una u otra parte
que es imposible, que es dificil que quitaramos deslindes si nos limitasemos
a considerar una sola parte. La primera parte autoriza a la legislatura para
fijar el limite maximo de propiedad agricola que los ciudadanos particulares
puede tener. Parece que es un punto que ha pasado desapercibido. No se
trata aqui ahora de propiedades urbanas, sino de propiedades agricolas, y
es por la razon de que con mucha especialidad en las regiones agricolas,
en las zones rusticas es donde el latifundismo se extiende con facilidad, y
desde alli los pequeños propietariou precisamente para ahogarles y para
intilizarles. Esta pues, a salvo completamente la cuestion de las
propiedades urbans. Cietos grandes soleres de nuestras ciudaes que con
pretexto de tener cietos eficios, que en realidad no necesitan de tales
extensos solares para su existencia ni para su mantenimineto, puedan
dormir transquilos. No Vamos contra esas propiedades. Por una causa o
por otra el pasado nos legardo ese lastre doloroso. Pero la region agricola,
la region menos explotada por nuetro pueblo, la region que necesitamos si
queremos vivir cuenta propia la region que es el mayor incentivo no para
solo para los grandes capitalistas de fuera merece todos los ciudados del
gobierno.
Voy a pasar ahora a la relacion que tiene la seggunda parte de la
enmiendad con la primera. Una vez demostrado ante la Lehgislatura, una
vez convencida la Asamblea Nacional de que existe un latifundismo y que
este laitifundismo puede producir males e esta produciendo daños a la
comunidad, es cuando entonces la Legislatura puede acordar la
expropiacion de los latifundios. Donde esta el mal que los opositores a este
es un postulado que todos conocen. Bien, voy a admitir para los propositos
del argumento que hoy no existen laifundios, y si los opostores al precepto
quieren mas vamos a convenir en que no existrian en el futuro. Pues,
entonces, donde este el temor de que el hijo de tal no pueda recibir la
herencia de cual? Por lo demas el ejemplo repetidas veces presentado ayer
yhoy en cuanto al herdero y al causahabiente no es completamente exacto.
Vamos a suponer que efectivamente un padre de familia posee un numero
tal de hectareas de terreno, superior o exedente a lo que fija la ley. Creen
los Caballeros, creen los opositorees al precepto que la Legislatura, la
Asamblea Nacional va a ser tan imprudente, tan loca que inmediatemente
disponga por ley que aquella porcion excedente del terreno que ha de
recibir un hijo de su padre no podra poseerlo, no podra tenerlo o recibirlo el
heredero.
Esa es una materia para la Asamblea Nacional. La asamblea Nacional sabe
que no puede dictar leyes o medidas imposibles de cumplir. Fijara el plazo,
fijara la proporcion de acuedo con las circunstancias del tiempo entonces
en que vivamos. Es posible que ahora un numero determinado de
hectereas sea excesivo; es posible que por desenvolvimientos economics
del paius ese numero de hectareas puede ser elevado o reducido. Es por
esto porque el Comite precisamente no ha querido fijar desde ahora el
numero de hectareas presamente no ha querido fijar desde ahora el
numero de hectareas, prefireindo dejar a la sabiduria, a la prudencia, al
patriotismo y a la justicia de la Asambela Nacional el fijar ese numero.
Lomismo digo de la expropiacion. Se habla de que el gobierno no tendra
dinero; se hablqa de que no podra revender las propieedades. Pero,
Caballeros de la Convencion, caballeros opositores del precepto; si la
Legislatura, si la AsambleaNacional estuviera convencida de que el
gobierno no puede hecer una exporpiacion, va a hecerlo? La Asamblea
Nacional dictara una ley autorizando la expropiacion de tal a cual latifundio
cuando este convencida, primero, de que la existencia de ese latifundio es
amenazante para el publico; y segundo, cuando la asamblea Nacional este
convencida de que el gobierno esta disposicion para disponer la
expropiacion.
Visto, pues, desde este punto el asunto, no es malo autorizar,fijar los
limites, ni macho menos es malo autorizar a la Legislatura para dictar leyes
de expropiacion.
Pero voy a molestaros por un minuto mas. Se ha mentado aquicon algun
exito esta mañana — y digo con exito porque he oidoalgunos aplausos —
se ha mentado la posibilidad de que los comunistas hagan un issue de esta
disposicion que existe en el draft; podran los comunistas pedir los votos del
electorado para ser elloslos que dicten las leyes fijando el limite del terreno
y ordenen la expropriacion? ¡Que argumento mas bonito si tuviera base! Lo
mas natural, creo yo, es que el pueblo, el electorado, al ver queno es una
Asamblea Constituyente comunista la que ha puestoesta disposicion,
otorgue sus votors a esta misma Asamblea Nacional, o a esos condidatos
no comunistas. ¿Quien esta en disposicion de terminar mejor una obra
aquel que trazado y puesto los primeros pilares, o aquel que viene de gorra
al final de la obra para decir: "Aqui estoy poner el tejado?"
Es sensible, sin embargo, que una cuetion de importancia tannacional
como este, pretendamos ligarla a los votos de los comulites de terreno; no
ha de venir porque nosotros fijemos loslimites de terreno; no ha de venir
porque prohibamos los latifundiosmediante expropiacion forzosa, no; ha de
venir precisamentepor causa de los grandes propietarios de terreno, y ha
de venir,queramoslo o no, porque el mundo esta evolucionando y se va
aconvencer de que la vida no es solamente para unos cuantos sinopara
todos , porque Dios no la dio, con la libertad, el aire, la luz,la tierra para vivir
(Grandes Aplausosz), y por algo se ha dichoque en los comienzos de la
vida himana debio haber sido fusilado,matado, a aquel primero que puso un
cerco a un pedazo de tierrareclamando ser suya a propiedad.
Por estas razones, señor Presidente, y sintiendo que mi tiempoesta para
terminar, voy a dar fin a mi discurso agradeciendo a la Convencion.
(Speech of Delegate Sotto.)
I would further add, Mr. President, that this precept by limiting private
individuals to holding and acquiring lands, private agricultural lands . . . is
discriminatory and unjust with regard to the agriculturists. Why not, Mr.
President, extend this provision also to those who are engaged in
 commerce and industries? Both elements amass wealth. If the purpose of
the Committee, Mr. President, is to distribute the wealth in such a manner
that it will no breed discontent, I see no reason for the discrimination against
the agricultural. In view of these reasons, Mr. President, I do not want to
speak further and I submit this amendment because many reasons have
been given already yesterday and this morning. (Speech of Delegate
Sevilla.)
Delegate Sotto was not interpellated, much less contradicted, on the observation that
section 3 of Article XIII does not embrace private urban lands. There is of course
every reason to believe that the sense in which the terms "private agricultural lands"
were employed in section 3 must be the same as that in section 5, if consistency is to
be attributed to the framers of the Constitution.
We should not be concluded by te remarks, cited in the majority opinion, made by
Delegate Ledesma to the effect that "the exclusion of aleins from the private of
acquiring public agricultural lands and of owning real estate is a necessary part of the
Public Land Laws," and of the statement of Delegate Montilla regarding "the complete
nationalization of our lands and natural resources," because (1) the remarks of
Delegate Ledesma expressly mentions "public agricultural lands" and the terms "real
estate" must undoubtedly carry the same meaning as the preceding words "public
agricultural lands", under the principle of "ejusdem generis"; (2) Delegate Ledesma
must have in mind purely "agricultural" lands, sicne he was the Chairman of the
Committee on Agricultural Development and his speech was made in connection with
the national policy on agricultural lands; (3) the general nature of the explanations of
both Delegate Ledesma and Delegate Montilla, cannot control the more specific
clarification of Delegate Sotto that agricultural lands in section 3 do not include urban
propeties. Neither are we bound to give reater force to the view (apparently based on
mere mental recollections) of the Justices who were members of the Constitutional
Convention than tot he specific recorded manifestation of Delegate Sotto.
The decision in the case of Mapa vs. Insular Government (10 Phil., 175), invoked by
the majority, is surely not controlling, because, first, it dealt with "agricultural public
lands" and, secondly, in that case it was expressly held that the phrase "agricultural
land" as used in Act No. 926 "means those public lands acquired from Spain which
are not timber or mineral lands," — the definition held to be found in section 13 of the
Act of Congress of July 1, 1902.
We hold that there is to found in the act of Congress a definition of the
phrase "agricultural public lands," and after a carefully consideration of the
question we are satisfied that the only definition which exists in said act is
the definition adopted by the court below. Section 13 says that the
Government shall "make rules and regulations for the lease, sale or other
disposition of the public lands other than timber or mineral lands." To our
minds that is the only definition that can be said to be given to agricultural
lands. In other words, that the phrase "agricultural land" as used in Act No.
926 means those public lands accquired from Spain which are not timber or
mineral lands. (Mapa vs. Insular Government, 10 Phil., 182.)
The majority, in support of their construction, invoke Commonwealth Act No. 141,
enected after the approval of the Constitution, which prohibits the alienation to
foreigners of "land originally acquired in any manner under the provisions of this Act,"
(section 122) or "land originally acquired in any manner under the provisions of any
previous Act, ordinance, royal order, royal decree, or any other provision of law
formerly in force in the Philippines with regard to public lands, terrenos baldios
realengos, or lands of any other denomination that were actually or presumptively of
the public domain." (Section 123.) They hold that the constitutional intent "is made
more patent and is strongly implemented by said Act." The majority have evidently
overlooked the fact that the prohibition contained in said sections refer to lands
originally acquired under said sections referto land originally acqured under said Act or
otherlegal provisions lands, which of course do not include lands not originally of the
public domain. The lands that may be acquired under Act No. 141 necessarily have to
be public agricultural lands, since they are the only kinds that are subject to alienation
or disposition under the Constitution. Hence, even if they become private, said lands
retained their original agricultural character and may not therefore be alienated to
foreigners. It is only in this sense, I think, that act No. 141 seeks to carry out and
implement the constitutional objective. In the case before us, however, there is no
pretense that the land bought by the appellant was originally acquired under said Act
or other legal provisions contemplated therein.
The majority is also mistaken in arguing that "prior to the Constitution, under section
24 of the Public Land Act No. 2874 aliens could acquire public agricultural lands used
for industrial or residential purposes, but after the Constitution and under section 23 of
Commonwealth Act No. 141, the right of aliens to acquire such kind of lands is
completely stricken out, undoubtedly in pursuanceof the Constitutional limitation," and
that "prior to the Constitution, under section 57 of the Public Land Act No.2874, land of
the public domain suitable for residence or industrial purposes could
be sold or leased to aliens, but after the Constitution and under section 60 of
Commonwealth Act No. 141, such land may only be leased, but not sold, to aliens,
and the lease granted shall only be valid while the land is used for the purpose
referred to." Section 1 of article XIII of the Constitution speaks of "public agricultural
lands" and quite logically, Commonwealth Act No. 141, enacted after the approval of
the Constitution, has to limit the alienation of its subject matter (public agricultural
land, which includes public residential or industrial land) to Filipino citizens. But it is
not correct to consider said Act as a legislation on, or a limitation against, the right of
aliens to acquire residential land that was already of private ownership prior to the
approval of the Constitution.
The sweeping assertion of the majority that "the three great departments of the
Government — Judicial, Legislative and Executive — have always maintained that
lands of the public domain are classified into agricultural, mineral and timber, and that
agricultural lands include residential lots," is rather misleading and not inconsistent,
with our position. While the construction mistakenly invoked by the majority refers
exclusively to lands of the public domain, our view is that private residential lands are
not embraced within the terms "private agricultural land" in section 5 of Article XIII. Let
us particularize in somewhat chronological order. We have already pointed out that
the leading case of Mapa vs. Insular Government, supra, only held that agricultural
public lands are those public lands acquired from Spain which are neither timber nor
mineral lands. The opinion of the Secretary of Justice dated July 15, 1939, quoted in
the majority opinion, limited itself in affirming that "residential, commercial or industrial
lots forming part of the public domain . . . must be classified as agricultural." Indeed,
the limited scope of said opinion is clearly pointed out in the following subsequent
opinion of the Secretary of Justice dated September 25, 1941, expressly hoding that
"in cases involving the prohibition in section 5 of Article XIII (formerly Article XII)
regarding transfer or assignment of private agricultural lands to foreigners, the opinion
that residential lots are not agricultural lands is applicable."
This is with reference to your first indorsement dated July 30, 1941,
forwarding the request of the Register of Deeds of Oriental Misamis for an
opinion as to whether Opinion No. 130, dated July 15, 1939, of this
Department quoted in its Circular No. 28, dated May 13, 1941, holding
among others, that the phrase "public agricultural land" in section 1, Article
XIII (formerly article XII) of the Constitution of the Philippines, includes
residential, commercial or industrial lots for purposes of their disposition,
amends or supersedeas a decision or order of the fourth branch of the Court
of First Instance of the City of Manila rendered pursuant to section 200 of
the Administrative Code which holds that a residential lot is not an
agricultural land, and therefore, the prohibition in section 5, Article XIII
(formerly Article XII) of the Constitution of the Philippines does not apply.
There is no conflict between the two opinions.
Section 1, Artcile XIII (formerly article XII of the Constitution of the
Philippines, speaks of public agricultural lands while section 5 of the same
article treats of private agricultural lands. A holding, therefore, that a
residential lot is not private agricultural land within the meaning of that
phrase as found in section 5 of Article XIII (formerly Article XII) does not
conflict with an opinion that residential, commercial or industrial lots forming
part of the public domain are included within the phrase "public agricultural
land" found in section 1, Article XIII (formerly Article XII) of the Constitution
of the Philippines. In cases involving the prohibition in section 5 of Article
XIII (formerly Article XII) regarding transfer or assignment of private
agricultural lands to foreigners, the opinion that residential lots are not
agricultural lands is applicable. In cases involving the prohibition in section 1
of Article XIII (formerly Article XII) regarding disposition in favor of, and
exploitation, development or utilization by foreigners of public agricultural
lands, the opinion that residential, commercial or industrial lots forming part
of the public domain are included within the phrase "public agricultural land"
found in said section 1 of the Article XIII (formerly Article XII) governs.
Commonwealth Act No. 141, passed after the approval of the Constitution limited its
restriction against transfers in favor of alien to public agricultural lands or to lands
originally acquired under said Act or other legal provisions formerly in force in the
Philippines with regard to public lands. On November 29, 1943, the Court of Appeals
rendered a decision affirming that of the Court of First rendered a decision affirming
that of the Court of First Instance of Tarlac in a case in which it was held that private
residential lots are not included in the prohibition in section 5 of Article XIII. (CA-G. R.
No. 29.) During theJapanese occupation, the Constitution of the then Republic of the
Philippines contained an almost verbatim reproduction of said section 5 of Article XIII;
and the then National Assembly passed an Act providing that "no natural or juridical
person who is not a Filipino citizen shall acquire directly or indirectly any title to private
lands (which are not agricultural lands) including buildings and other improvements
thereon or leasehold rights on said lands, except by legal succession of proper cases,
unless authorized by the President of the Republic of the Philippines." (Off. Gaz., Vol.
I, p. 497, February,1944.) It is true that the Secretary of Justice in 1945 appears to
have rendered an opinion on the matter, but it cannot have any persuasive force
because it merely suspended the effect of the previous opinion of his Department
pending judicial determination of the question. Very recently, the Secretary of Justice
issued a circular adopting in effect the opinion of his Department rendered in1941.
Last but not least, since the approval of the Constitution, numerous transactions
involving transfers of private residential lots to aliens had been allowed to be
registered without any opposition on the part of the Government. It will thus be seen
that, contrary to what the majority believe, our Government has constantly adopted the
view that private residential lands do not fall under the limitation contained in section 5
of Article XIII of the Constitution.
I do not question or doubt the nationalistic spirit permeating the Constitution, but I will
not permit myself to be blinded by any sentimental feeling or conjectural
considerations to such a degree as to attribute to any of its provisions a construction
not justified by or beyond what the plain written words purport to convey. We need not
express any unnecessary concern over the possibility that entire towns and cities may
come to the hands of aliens, as long as we have faith in our independence and in our
power to supply any deficiency in the Constitution either by its amendment or by
Congressional action.
There should really have been no occasion for writing this dissent, because the
appellant, with the conformity of the appellee, had filed a motion for the withdrawal of
the appeal and the same should have been granted outright. In Co Chiong vs.
Dinglasan (p. 122, ante),decided only a few days ago, we reiterated the well-settled
rule that "a court should not pass upon a constitutional question and decide a law to
be unconstitutional or invalid unless such question is raised by the the parties, and
that when it is raised, if the record also presents some other ground upon which the
court may rest its judgment, that course will be adopted and the constitutional question
will be left for consideration until a case arises in which a decision upon such question
will be unavoidable." In other words, a court will always avoid a constitutional
question, if possible. In the present case, that course of action was not only possible
but absolutely imperative. If appellant's motion for withdrawal had been opposed by
the appellee, there might be some reasons for its denial, in view of section 4 of Rule
52 which provides that after the filing of appellee's brief, "the withdrawal may be
allowed by the court in its discretion." At any rate, this discretion should always be
exercised in favor of a withdrawal where a constitutional question will thereby be
avoided.
In this connection, let us describe the proceedings (called "arbitrary and illegal" by Mr.
Justice Tuason) that led to teh denial of the motion for withdrawal. During the
deliberation in which all the eleven members were present, seven voted to allow and
four to deny. Subsequently, without any previous notice and when Mr. Justice
Hontiveros was absent, the matter was again submitted to a vote, and one Justice
(who previously was in favor of the withdrawal) reversed his stand, with the result that
the votes were five to five. This result was officially released and the motion denied
under the technicality provided in Rule of Court No. 56, section 2. It is very interesting
to observe that Mr. Justice Hontiveros, who was still a member of the Court and could
have attended the later deliberation, if notified and requested, previously voted for the
granting of the motion. The real explanation for excluding Mr. Justice Hontiveros,
against my objection, and for the reversal of the vote of one Justice who originally was
in favor of the withdrawal is found in the confession made in the majority opinion to the
effect that the circular of the Department of Justice instructing all registers of deeds to
accept for registration transfers of residential lots to aliens, was an "interference with
the regular and complete exercise by this Court of its constitutional functions," and
that "if we grant the withdrawal, the result is that petitioner-appellant Alexander A.
Krivenko wins his case, not by a decision of this Court, but by the decision or circular
of the Department of Justice issued while this case was pending before this Court."
The zealousness thus shown in denying the motion for wuthdrawal is open to
question. The denial of course is another way of assuming that the petitioner-appellant
and the Solicitor General had connived with the Department of Justice in a scheme
not only to interfere with the functions of this Court but to dispose of the national
patrimony in favor of aliens.
In the absence of any injunction from this Court, we should recognize tha right of the
Department of Justice to issue any circular it may deem legal and proper on any
subject, and the corollary right of the appellant to take advantage thereof. What is
most regrettable is the implication that the Department of Justice, as a part of the
Executive Department, cannot be as patriotic and able as this Court in defending the
Constitution. If the circular in question is objectionable, the same can be said of the
opinion of the Secretary of Justice in 1945 in effect prohibiting the registration of
transfers of private residential lots in favor of aliens, notwithstanding the pendency in
this Court of the case of Oh Cho vs. Director of Lands (43 Off. Gaz., 866), wherin
according to the appellant, the only question raised was whether, or not "an alien can
acquire a residential lot and register it in his name," and notwithstanding the fact that
in said case the appealed decision was in favor of the alien applicant and that, as
hereinbefore stated, the Court of Appeals in another case (CA-G.R. No. 29) had
renderd in 1943 a decision holding that private residential lots are not included in the
prohibition in section 5 of Article XIII of the Constitution. And yet this Court, failing to
consider said opinion as an "interference," chose to evade the only issue raised by the
appellant and squarely met by the appellee in the Oh Cho case which already required
a decision on the constitutional question resolved in the case at bar against, so to say,
the will of the parties litigant. In other words, the majority did not allow the withdrawal
of the present appeal not so much as to dispose of it on the merits, but to annul the
circular of the Department of Justice which is, needless to say, not involved in this
case. I cannot accept the shallow excuse of the majority that the denial of the motion
for withdrawal was promted by the fear that "our indifference of today might signify a
permanent offense to the Constitution," because it carries the rather immodest
implication that this Court has a monopoly of the virtue of upholding and enforcing, or
supplying any deficiency in, the Constitution. Indeed, the fallacy of the impliation is
made glaring when Senator Franscisco lost no time in introducing a bill that would
clarify the constitutional provision in question in the sense desired by the majority.
Upon the other hand, the majority should not worry about the remoteness of the
opportunity that will enable this Court to pass upon this constitutional question,
because we can take advance notice of the fact that in Rellosa vs. Gaw Chee Hun (49
Off. Gaz., 4345), in which the parties have already presented. But even disregarding
said case, I am sure that, in view of the recent newspaper discussion which naturally
reached the length and breadth of the country, there will be those who will dispute
their sales of residential lots in favor of aliens and invoke the constitutional prohibition.
BENGZON, J., dissenting:
It is unnecessary to deliver at this time any opinion about the extent of the
constitutional prohibition. Both parties having agreed to writer finis to the litigation,
there is no obligation to hold forth on the issue. It is not our mission to give advice to
other person who might be interested to give advice to other persons who might be
interested to know the validity or invalidity of their sales or purchases. That is the work
of lawyers and juriscounsults.
There is much to what Mr. Justice Padilla explains regarding any eagerness to solve
the constitutional problem. It must be remembered that the other departments of the
Government are not prevented from passing on constitutional question arising in the
exercise of their official powers. (Cooley, Constitutional Limitations, 8th ed., p. 101.)
This Tribunal was not established, nor is it expected to play the role of an overseer to
supervise the other Government departments, with the obligation to seize any
opportunity to correct what we may believe to be erroneous application of the
constitutional mandate. I cannot agree to the suggestion that the way the incumbent
Secretary of Justice has interpreted the fundamental law, no case will ever arise
before the court, because the registers of deeds under his command, will transfer on
thier books all sales to aliens. It is easy to perceive several probabilities: (1) a new
secretary may entertain opposite views; (2) parties legally affected — like heirs or or
creditors of the seller — may wish to avoid the conveyance to aliens, invoking the
constitutional inhibition. Then, in a truly contested case, with opposing litigants actively
arguing their sides we shall be in a position to do full justice. It is not enough that
briefs — as in this case — have been filed; it is desirable, perhaps essential, to make
sure that in a motion for reconsideration, or in a re-hearing in case of tie, our attention
shall be invited to points inadequately touched or improperly considered.
It is stated that sales to aliens of residential lots are currently being effected. No
matter. Those sales will be subject to the final decision we shall reach in a properly
submitted litigation. To spell necessity out of the existence of such conveyances,
might amount to begging the issue with the assumption that such transfers are
obviously barred by the Organic Law. And yet sales to foreigners of residential lots
have taken place since our Constitution was approved in 1935, and no one questioned
their validity in Court until nine years later in 1945, after the Japanese authorities had
shown distaste for such transfers.
The Court should have, I submit, ample time to discuss this all-important point, and
reflect upon the conflicting politico-economic philosophies of those who advocate
national isolation against international cooperation, and vice-versa. We could also
delve into several aspects necessarily involved, to wit:
(a) Whether the prohibition in the Constitution operated to curtail the freedom to
dispose of landowners at the time of its adoption; or whether it merely affected the
rights of those who should become landowners after the approval of the Constitution; 7
(b) What consequences would a ruling adverse to aliens have upon our position and
commitments in the United Nations Organization, and upon our treaty-making
negotiations with other nations of the worlds; and
(c) When in 1941 Krivenko acquired this land he was a Russian citizen. Under the
treaties between the United States and Russia, were Russian nationals allowed to
acquire residential lots in places under the jurisdiction of the United States? If so, did
our Constitution have the effect of modifying such treaty during the existence of the
Commonwealth Government?
The foregoing view and doubts induced me to vote for dismissal of the appeal as
requested by the parties, and for withholding of any ruling on the constitutional
prohibition. However, I am now ready to cast my vote. I am convinced that the organic
law bans the sales of agricultural lands as they are popularly understood — not
including residential, commercial, industrial or urban lots. This belief is founded on the
reasons ably expounded by Mr. Justice Paras, Mr. Justice Padilla and Mr. Justice
Tuason. I am particularly moved by the consideration that a restricted interpretation of
the prohibition, if erroneous or contrary to the poeple's desire, may be remedied by
legislation amplifying it; whereas a liberal and wide application, if erroneous, would
need the cumbersome and highly expensive process of a constitutional amendment.
PADILLA, J., dissenting:
The question submitted for decision is whether a parcel of land of private ownership
suitable or intended for residence may be alienated or sold to an alien.
Section 5, Article XIII, of the Constitution provides:
Save in cases of hereditary succession, no private agricultural land shall be
transferred or assigned except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain in the Philippines.
The majority holds that a parcel of land of privateownership suitable or intended or
used for residence is included in the term "private agricultural land" and comes within
the prohibition of the Constitution. In support of the opinion that lands of private
ownership suitable for residence are included in the term "private agricultural land"
and cannot be alienated or sold to aliens, the majority invokes the decision of this
Court in Mapa vs. Insular Government (10 Phil., 175), which holds that urban lands of
the public domain are included in the term "public agricultural land." But the opinion of
the majority overlooks the fact that the inclusion by this Court of public lands suitable
for residence in the term "public agricultural land" was due to the classification made
by the Congress of the United States in the Act of 1 July 1902, commonly known as
the Philippine Bill. In said Act, lands of the public domain were classified into
agricultural, timber and mineral. The only alienable or disposable lands of the public
domain were those belonging to the first class. Hence a parcel of land of the public
domain suitable for residence, which was neither timber nor mineral, could not be
disposed of or alienated unless classified as public agricultural land. The susceptibility
of a residential lot of the public domain of being cultivated is not the real reason for the
inclusion of such lot in the classification of public agricultural land, for there are lands,
such as foreshore lands, which would hardly be susceptible of cultivation (Ibañez de
Aldecoa vs. Insular Government, 13 Phil., 159, 167-168), and yet the same come
under the classification of public agricultural land. The fact, therefore, that parcels of
land of the public domain suitable for residence are included in the classification of
public agricultural land, is not a safe guide or index of what the framers of the
Constitution intended to mean by the term "private agricultural land." It is contrary to
the rules of statutory construction to attach technical meaning to terms or phrases that
have a common or ordinary meaning as understood by he average citizen.
At the time of the adoption of the Constitution (8 February 1935), the Public Land Act
in force was Act No. 2874. Under this Act, only citizens of the Philippine Islands or of
the United States and corporations or associations described in section 23 thereof,
and citizens of countries the laws of which grant to citizens of the Philippine Islands
the same right to acquire the public land as to their own citizens, could acquire by
purchase agricultural land of the public domain (section 23, Act No. 2874). This was
the general rule. There was an exception. Section 24of the Act provides:
No person, corporation, association or partnership other than those
mentioned in the last preceding section may acquire or own agricultural
public land or land of any other denomination or classification, not used for
industrial or residence purposes, that is at the time or was originally, really
or presumptively, of the public domain, or any permanent improvement
thereon, or any real right on such land and improvement: Provided,
however, That persons, corporations, associations, or partnerships which at
the date upon which this Act shall take effect, hold agricultural public lands
or land of any other denomination not used for industrial or residence
purposes, that belonged originally, really or presumptively, to the public
domain, or permanent improvements on such lands, or a real right upon
such lands and improvements, having acquired the same under the laws
and regulations in force at the date of such acquisition, shall be authorized
to continue holding the same as if such persons, corporations, associations,
or partnerships were qualified under the last preceding section; but they
shall not encumber, convey, or alienate the same to persons, corporations,
associations or partnerships not included in section twenty-three of this Act,
except by reason of hereditary succession, duly legalized and
acknowledged by competent Courts. (Emphasis supplied.)
Section 57 of the Act, dealing with lands of the public domain suitable for residential,
commercial, industrial, or other productive purposes other than agricultural, provides:
 Any tract of land comprised under this title may be leased or sold, as the
case may be, to any person, corporation, or association authorized to
purchase or lease public lands for agricultural purposes. . . . Provided
further, That any person, corporation, association, or
partnership disqualified from purchasing public land for agricultural
purposes under the provisions of this Act, may purchase or lease land
included under this title suitable for industrial or residence purposes, but the
title or lease granted shall only be valid while such land issued for the
purposes referred to. (Emphasis supplied.)
Section 121 of the Act provides:
No land originally acquired in any manner under the provisions of the former
Public Land Act or of any other Act, ordinance, royal order, royal decree, or
any other provision of law formerly in force in the Philippine Islands with
regard to public lands, terrenos baldios y realengos, or lands of any other
denomination that were actually or presumptively of the public domain, or by
royal grant or in any other form, nor any permanent improvement on such
land, shall be encumbered, alienated, or conveyed, except to persons,
corporations, or associations who may acquire land of the public domain
under this Act; . . . Provided, however, That this prohibition shall not be
applicable to the conveyance or acquisition by reason of hereditary
succession duly acknowledged and legalized by competent Courts, nor to
lands and improvements acquired or held for industrial or residence
purposes, while used for such purposes: . . . (Emphasis supplied.)
Under and pursuant to the above quoted provisions of Act No. 2874, lands of the
public domain, that were neither timber nor mineral, held for industrial or residence
purposes, could be acquired by aliens disqualified from acquiring by purchase or lease
public agricultural lands (sections 24, 57, 121, Act No. 2874). The delegates to the
Constituent Assembly were familiar with the provisions of the Public Land Act referred
to. The prohibition to alienate public agricultural lands to disqualified persons,
corporations or associations did not apply to "lands and improvements acquired or
held for industrial or residence purposes, while used for such purposes." Even under
the provisions of Act No. 926, the first Public Land Act, lots for townsites could be
acquired by any person irrespective of citizenship, pursuant to section 47 of the said
Act. In spite of the nationalistic spirit that pervades all the provisions of Act No. 2874,
the Philippine Legislature did not deem it necessary to exclude aliens from acquiring
and owning lands of the public domain suitable for industrial or residence purposes. It
adopted the policy of excluding aliens from acquiring agricultural lands of the public
domain not "suitable for residential, commercial, industrial, or other productive
purposes," which, together with timber, mineral and private agricultural lands,
constitute the mainstay of the nation. Act No. 2874 was in force for nearly sixteen
years — from 1919 to 1935. There is nothing recorded in the journals of proceedings
of the Constituent Assembly regarding the matter which would have justified a
departure from the policy theretofore adopted.
If under the law in force at the time of the adoption of the Constitution, aliens could
acquire by purchase or lease lands of the public domain, that were neither timber nor
mineral, held for industrial or residence purposes, how can it be presumed that the
framers of the Constitution intended to exclude such aliens from acquiring by
purchase private lands suitable for industrial or residence purposes? If pursuant to the
law in force at the time of the adoption of the Constitution, lands of the public domain
and improvements thereon acquired or held for industrial or residence purposes were
not included in the prohibition found in section 121 of ActNo. 2874, there is every
reason for believing that the framers of the Constitution, who were familiar with the law
then in force, did not have the intention of applying the prohibition contained in section
5, Article XIII, of the Constitution to lands of private ownership suitable or intended or
used for residence, there being nothing recorded in the journals of proceedings of the
Constituent Assembly regarding the matter which, as above stated, would have
justified a departure from the policy then existing. If the term "private agricultural land"
comprehends lands of private ownership suitable or intended or used for residence, as
held by the majority, there was no need of implementing a self-executory prohibition
found in the Constitution. The prohibition to alienate such lands found in section 123 of
Commonwealth Act No. 141 is a clear indication and proof that section 5, Article XIII,
of the Constitution does not apply to lands of private ownership suitable or intended or
used for residence. The term "private agricultural land" means privately owned lands
devoted to cultivation, to the raising of agricultural products, and does not include
urban lands of private ownership suitable for industrial or residence purposes. The use
of the adjective "agricultural" has the effect of excluding all other private lands that are
not agricultural. Timber and mineral ands are not, however, included among the
excluded, because these lands could not and can never become private lands. From
the land grants known as caballerias and peonias under the Laws of Indies down to
those under the Royal Decrees of 25 June 1880 and 13 February 1894, the Philippine
Bill, Act No. 926, the Jones Law, Act No. 2874, the Constitution, and Commonwealth
Act No. 141, timber and mineral lands have always been excluded from alienation.
The repeal by sections 23, 60, 123 of Commonwealth Act No. 141 of the exception
provided for in sections 24, 57, 121 of Act No. 2874, did not change the meaning of
the term "private agricultural land," as intended by the framers of the Constitution and
understood by the people that adopted it.
The next question is whether the court below was justified under the in confirming the
refusal of the Register of Deeds of Manila to record the sale of the private land for
residence purposes to the appellant who is an alien.
There is no evidence to show the kind of land, the deed of sale of which is sought to
be recorded by the appellant — whether it is one of those described in section 123 of
Commonwealth Act No. 141; or a private land that had never been a part of the public
domain (Carino vs. Insular Government, 212 U.S., 449; Oh Cho vs. Director of Lands,
43 Off. Gaz., 866). If it is the latter, the prohibition of section 123 of Commonwealth
Act No. 141 does not apply. If it is the former, section 123 of Commonwealth Act No.
141, which providesthat —
No land originally acquired in any manner under the provisions of any
previous Act, ordinance, royal order, royal decree, or any other provision of
law formerly in force in the Philippines with regard to public lands, terrenos
 baldios y realengos, or lands of any other denomination that were actually
or presumptively of the public domain, or by royal grant or in any other form,
nor any permanent improvement on such land, shall be encumbered,
alienated, or conveyed, except to persons, corporations or associations who
may acquire land of the public domain under this Act or to corporate bodies
organized in the Philippines whose charters authorize them to do so: . . .
is similar in nature to section 121 of Act No. 2874. This Court held the last mentioned
section unconstitutional, for it violates section 3 of the Act of Congress of 29 August
1916, commonly known as the Jones Law (Central Capiz vs. Ramirez, 40 Phil., 883).
Section 123 of Commonwealth Act No. 141, following the rule laid down in the
aforecited case, must also be declared unconstitutional, for it violates section 21 (1),
Article VI, of the Constitution, which is exactly the same as the one infringed upon by
section 121 of Act No. 2874. This does not mean that a law may not be passed by
Congress to prohibit alienation to foreigners of urban lands of private ownership; but in
so doing, it must avoid offending against the constitutional provision referred to above.
Before closing, I cannot help but comment on the action taken by the Court in
considering the merits of the case, despite the withdrawal of the appeal by the
appellants, consented to by the appellee. If discretion was to be exercised, this Court
did not exercise it wisely. Courts of last resort generally avoid passing upon
constitutional questions if the case where such questions are raised may be decided
on other grounds. Courts of last resort do not express their opinion on a consitutional
question except when it is the very lis mota (Yangco vs. Board of Public Utility
Commissioners, 36 Phil., 116, 120; Co Chiong vs. Dinglasan, p. 122, ante). Moreover,
the interpretation of the provisions of the Constitution is no exclusive of the courts. The
other coordinate branches of the government may interpret such provisions acting on
matters coming within their jurisdiction. And although such interpretation is only
persuasive and not binding upon the courts, nevertheless they cannot be deprived of
such power. Of course, the final say on what is the correct interpretation of a
constitutional provision must come from and be made by this Court in an appropriate
action submitted to it for decision. The correct interpretation of a constitutional
provision is that which gives effect to the intent of its framers and primarily to the
understanding of such provision by the poeple that adopted it. This Court is only an
interpreter of the instrument which embodies what its framers had in mind and
especially what the people understood it to be when they adopted it. The eagerness of
this Court to express its opinion on the constitutional provision involved in this case,
notwithstanding of the withdrawal of the appeal, is unusualf or a Court of last resort. It
seems as if it were afraid to be deprived by the other coordinate branches of the
government of its prerogative to pass upon the constitutional question herein involved.
If all the members of the Court were unanimous in the interpretation of the
constitutional provision under scrutiny, that eagerness might be justified, but when
some members of the Court do not agree to the interpretation placed upon such
provision, that eagerness becomes recklessness. The interpretation thus placed by
the majority of the Court upon the constitutional provision referred to will be binding
upon the other coordinate branches of the government. If, in the course of time, such
opinion should turn out to be erroneous and against the welfare of the country,an
amendment to the Constitution — a costly process — would have to be proposed and
adopted. But, if the Court had granted the motion for the withdrawal of the appeal, it
would not have to express its opinion upon the constitutional provision in question. It
would let the other coordinate branches of the Government act according to their
wisdom, foresight and patriotism. They, too, possess those qualities and virtues.
These are not of the exclusive possession of the members of this Court. The end
sought to be accomplished by the decision of this Court may be carried out by the
enactment of a law. And if the law should turn out to be against the well-being of the
people, its amendment or repeal would not be as costly a process as a constitutional
amendment.
In view of the denial by this Court of the motion to dismiss the appeal, as prayed for by
the appellant and consented to by the appellee, I am constrained to record my
opinion, that, for the reasons hereinbefore set forth, the judgment under review should
be reversed.
TUASON, J., dissenting:
The decision concludes with the assertion that there is no choice. "We are construing"
it says, "the Constitution as we see it and not as we may wish it to be. If this is the
solemn mandate of the Constitution, we cannot compromise it even in the name of
equity." We wish deep in our heart that we were given the light to see as the majority
do and could share their opinion. As it is, we perceive things the other way around. As
we see it, the decision by-passed what according to our humble understanding is the
plain intent of the Constitution and groped out of its way in search of the ideal result.
The denial by this Court of the motion to withdraw the appeal to which the Solicitor
General gave his conformity collides with the professed sorrow that the decision
cannot be helped.
Section 5, Article XIII, of the Constitution reads:
5. Save in cases of hereditary succession, no private agricultural land shall
be transferred or assigned except to individuals, corporations, or
associations qualified to acquire or hold lands of the public domain in the
Philippines.
The sole and simple question at issue is, what is the meaning of the term "agricultural
land" as used in this section? Before answering the question, it is convenient to
refresh our memory of the pertinent rule in the interpretation of constitutions as
expounded in decisions of courts of last resort and by law authors.
It is a cardinal rule in the interpretation of constitutions that the instrument
must be a construed so to give effect to the intention of the people who
adopted it. This intention is to be sought in the constitution itself, and the
apparent meaning of the words employed is to be taken as expressing it,
except in cases where the assumption would lead to absurdity, ambiguity, or
contradiction. Black on Interpretation of Laws, 2nd ed., p. 20.)
Every word employed in the constitution is to be expounded in its plain,
obvious, and common sense, unless the context furnishes some ground to
 control, qualify, or enlarge it. Constitutions are not designed for
metaphysical or logical subtleties, for niceties of expression, for critical
propriety, for elaborate shades of meaning, or for the exercise of
philosophical acuteness or judicial research. They are instruments of a
practical nature founded on the common business of human life adapted to
common wants, designed for common use, and fitted for common
understandings. The people make them, the people adopt them, the people
must be supposed to read them with the help of common sense, and cannot
be presumed to admit in them any recondite meaningor any extraordinary
gloss. (1 Story, Const. sec. 451.)
They are either residential, commercial, or industrial lands. In all city plannings,
communities are divided into residential, commercial and industrial sections. It would
be extremely out of the ordinary, not to say ridiculous, to imagine that the
Constitutional Convention considered a lot on the Escolta with its improvement as
agricultural land.
If extrinsic evidence is needed, a reference to the history of the constitutional provision
under consideration will dispel all doubts that urban lands were in the minds of the
framers of the Constitution as properties that may be assigned to foreigners.

Dean Aruego, himself a member of the Constitutional Convention, is authority for the
Marshall , Ch. J., says:
statement that the committee on nationalization and preservation of lands and other
natural resources in its report recommended the incorporation into the Constitution of
The framers of the Constitution, and the people who adopted it, "must be the following provision:
understood to have employed words in their natural sense, and to have
intended what they have said." (Gibbons vs. Ogdon, 9 Wheat, 1, 188; 6
SEC. 4. Save in cases of hereditary succession, no land of private
Law. ed., 23).
ownership shall be transferred or assigned by the owner thereof except to
individuals, corporations, or associations qualified to acquire or hold lands of
Questions as to the wisdom, expediency, or justice of constitutional the public domain in the Philippine Islands; and the Government shall
provisions afford no basis for construction where the intent to adopt such regulate the transfer or assignment of land now owned by persons, or
provisions is expressed in clear and unmistakable terms. Nor can corporations,or associations not qualified under the provisions of this
construction read into the provisions of a constitution some unexpressed Constitution to acquire or hold lands in the Philippine Islands.
general policy or spirit, supposed to underline and pervade the instrument
and to render it consonant to the genius of the institutions of the state. The
In Article XIII, entitled "General Provisions," of the first draft of the Constitution, the
courts are not at liberty to declare an act void because they deem it
sub-committee of seven embodied the following provision which had been
opposed to the spirit of the Constitution. (12 C.J., 702-703.)
recommended in the reports of the committee on agricultural development, national
defense, industry, and nationalization and preservation of lands and other natural
There is no obscurity or ambiguity in the section of the Constitution above quoted, nor resources:
does a literal interpretation of the words "agricultural land" lead to any un-the majority
opinion, the phrase has no technical meaning, and the same could not have been
SEC. 16. Save in cases of hereditary succession, no land of private
used in any sense other than that in which it is understood by the men in the street.
ownership shall be transferred or assigned by the owner thereof except to
individuals, corporations, or associations qualified to acquire or hold lands of
That there are lands of private ownership will not be denied, inspite of the fiction tha all the public domain in the Philippines.
lands proceed from the sovereign. And, that lands of private ownership are known as
agricultural, residential, commercial and industrial, is another truth which no one can
But on January 22, 1935, the sub-committee of seven submitted to the Convention a
successfully dispute. In prohibiting the alienation of private agricultural land to aliens,
revised draft of the articleo n General Provisions of the first draft, which revised draft
the Constitution, by necessary implication, authorizes the alienation of other kinds of
had been prepared by the committee in consultation with President Quezon. The
private property. The express mention of one thing excludes all others of the same
revised draft as it touches private lands provides as follows:
kind.

Save in cases of hereditary succession, no agricultural land of private

Let us then ascertain the meaning of the word "agricultural" so that by process of
ownership shall be transferred or assigned by the owner thereof except to
elimination we can see what lands do not fall within the purview of the constitutional
individuals, corporations, or associations qualified to acquire or hold lands,
inhibition. Webster's New international Dictionary defines this word as "of or pertaining
of the public domain in the Philippine Islands. (2 The Framing of the
to agriculture connected with, or engaged in, tillage; as, the agricultural class;
Philippine Constitution, Aruego, 595-599.)
agricultural implements, wages, etc." According to this definition and according to the
popular conception of the word, lands in cities and towns intended or used for
buildings or other kinds of structure are never understood to mean agricultural lands.
The last-quoted proposal became section 5 of Article XIII of the Constitution in its final
form with sligh alteration in the phraseology.
It will thus be seen that two committees in their reports and the sub-committee of
seven in its first draft of the Constitution all proposed to prescribe the transfer to non-
Filipino citizens of any land of private ownership without regard to its nature or use,
but that the last mentioned sub-committee later amended that proposal by putting the
word "agricultural" before the word "land." What are we to conclude from this
modification? Its self-evident purpose was to confine the prohibition to agricultural
lands, allowing the ownership by foreigners of private lands that do not partake of
agricultural character. The insertion of the word "agricultural" was studied and
deliberated, thereby eliminating any possibility that its implication was not
comprehended.
In the following paragraphs we shall, in our inadequate way, attempt to show that the
conclusions in this Court's decision are erroneous either because the premises are
wrong or because the conclusions do not follow the premises.
According to the decision, the insertion of the word "agricultural" was not intended to
change the scope of the provision. It says that "the wording of the first draft was
amended for no other purpose than to clarify concepts and avoid uncertainties."
If this was the intention of the Constitutional Assembly, that could not have devised a
better way of messing up and obscuring the meaning of the provision than what it did.
If the purpose was "to clarify concepts and avoid uncertainties," the insertion of the
word "agricultural" before the word "land" produced the exact opposite of the result
which the change was expected to accomplish — as witness the present sharp and
bitter controversy which would not have arisen had they let well enough alone.
But the assumption is untenable. To brush aside the introduction of the word
"agricultural" into the final draft as "merely one of words" is utterly unsupported by
evidence, by the text of the Constitution, or by sound principles of construction. There
is absolutely no warrant or the statement that the Constitutional Convention, which
was guided by wise men, men of ability and experience in different fields of endeavor,
used the termafter mature deliberation and reflection and after consultation with the
President, without intending to give it its natural signification and connotation. "We are
not at liberty to presume that the framers of the Constitution, or the people who
adopted it, did not understand the force of language." (People vs. Rathbone, 32
N.Y.S., 108.) The Constitution will be scanned in vain for any reasonable indication
that its authors made the change with intention that it should not operate according to
the rules of grammar and the ordinary process of drawing logical inferences. The
theory is against the presumption, based on human experience, that the framers of a
constitution "have expressed themselves in careful and measured terms,
corresponding with the immense importance of the powers delegated, leaving as little
as possible to implication." (1 Cooley's Constitutional Limitations, 8th ed., 128, 129.)
"As men, whose intention require no concealment, generally employ the words which
most directly and aptly express the ideas they intend to convey, the enlightened
patriots who framed our constitution, and the people who adopted it, must be
understood to have employed words in their natural sense and to have intended what
they have said." (Gibbons vs. Ogden, ante.)
When instead of prohibiting the acquisition of private land of any kind by foreigners, as
originally proposed, the prohibition was changed to private agricultural lands, the
average man's faculty of reasoning tells him that other lands may be acquired. The
elementary rules of speech with which men of average intelligence, and, above all, the
members of the Constitutional Assembly were familiar, inform us that the object of a
descriptive adjective is to specify a thing as distinct from another. It is from this
process of reasoning that the maxim expressio unius est exclusio alterius stems; a
familiar rule of interpretation often quoted, and admitted as agreeable to natural
reason.
If then a foreigner may acquire private lands that are not agricultural, what lands are
they? Timber land or mineral land, or both? As the decision itself says these lands are
not susceptible of private ownership, the answer can only be residential, commercial,
industrial or other lands that are not agricultural. Whether a property is more suitable
and profitable to the owners as residential, commercial or industrial than if he devotes
it to the cultivation of crops is a matter that has to be decided according to the value of
the property, its size, and other attending circumstances.
The main burden of this Court's argument is that, as lands of the public domain which
are suitable for home building are considered agricultural land, the Constitution
intended that private residential, commercial or industrial lands should be considered
also agricultural lands. The Court says that "what the members of the Constitutional
Convention had in mind when they drafted the Constitution was this well-known
classification (timber, mineral and agricultural) and its technical meaning then
prevailing."
As far as private lands are concerned, there is no factual or legal basis for this
assumption. The classification of public lands was used for one purpose not
contemplated in the classification of private lands. At the outset, it should be
distinctively made clear that it was this Court's previous decisions and not an Act of
Congress which declared that public lands which were not forest or mineral were
agricultural lands. Little reflection on the background of this Court's decisions and the
nature of the question presented in relation to the peculia rprovisions of the
enactments which came up for construction, will bring into relief the error of applying
to private lands the classification of public lands.
In the first place, we cannot classify private lands in the same manner as public lands
for the very simple and manifest reason that only lands pertaining to one of the three
groups of public lands — agricultural — can find their way into the hands of private
persons. Forest lands and mineral lands are preserved by the State for itself and for
posterity. Granting what is possible, that there are here and there forest lands and
mineral lands to which private persons have obtained patents or titles, it would be
pointless to suppose that such properties are the ones which section 5 of Article XIII of
the Constitution wants to distinguish from private agricultural lands as lienable. The
majority themselves will not admit that the Constitution which forbids the alienation or
private agricultural lands allows the conveyance of private forests and mines.
In the second place, public lands are classified under special conditions and with a
different object in view. Classification of public lands was and is made for purposes of
administration; for the purpose principally of segregating lands that may be sold from
lands that should be conserved. The Act of July 1, 1902, of the United States
Congress designated what lands of the public domain might be alienated and what
should be kept by the State. Public lands are divided into three classes to the end that
natural resources may be used without waste. Subject to some exceptions and
limitation, agricultural lands may be disposed of by the Government. Preservation of
forest and mineral lands was and is a dominant preoccupation. These are important
parts of the country's natural resources. Private non-agricultural land does not come
within the category of natural resources. Natural resources are defined in Webster's
Standard Dictionary as materials supplied or produced by nature. The United States
Congress evinced very little if any concern with private lands.
It should also be distinctively kept in mind that the Act of Congress of the United
States above mentioned was an organic law and dealt with vast tracts of untouched
public lands. It was enacted by a Congress whose members were not closely familiar
with local conditions affecting lands. Under the circumstances, it was natural that the
Congress employed "words in a comprehensive sense as expressive of general ideas
rather than of finer shades of thought or of narrow distinctions. "The United States
Congress was content with laying down a broad outline governing the administration,
exploitation, and disposition of the public wealth, leaving the details to be worked out
by the local authorities and courts entrusted with the enforcement and interpretation of
the law.
It was a result of this broad classification that questions crept for a definition of the
status of scattered small parcels of public lands that were neither forest, mineral, nor
agricultural, and with which the Congress had not bothered itself to mention separately
or specifically. This Court, forced by nature of its duty to decide legal controversies,
ruled that public lands that were fit for residential purposes, public swamps and other
public lands that were neither forest nor mineral, were to be regarded as agricultural
lands. In other words, there was an apparent void, often inevitable in a law or
constitution, and this Court merely filled that void. It should be noted that this Court did
not say that agricultural lands and residential lands are the same or alike in their
character and use. It merely said that for the purpose of judging their alienability,
residential, commercial or industrial lands should be brought under the class of
agricultural lands.
On the other hand, section 5 of Article XIII of the Constitution treats of private lands
with a different aim. This Court is not now confronted with any problem for which there
is no specific provision, such as faced it when the question of determining the
character of public residential land came up for decision. This Court is not called to
rule whether a private residential land is forest, mineral or agricultural. This Court is
not, in regard to private lands, in the position where it found itself with reference to
public lands, compelled by the limited field of its choice for a name to call public
residential lands, agricultural lands. When it comes to determining the character of
private non-agricultural lands, the Court's task is not to compare it with forests, mines
and agricultural lands, to see which of these bears the closest resembrance to the
land in question. Since there are no private timber nor mineral lands, and if there
were, they could not be transferred to foreigners, and since the object of section 5 of
Article XIII of the Constitution is radically at variance withthat of the laws covering
public lands, we have to have different standards of comparison and have to look of
the intent of this constitutional provision from a different angle and perspective. When
a private non-agricultural land demands to know where it stands, we do not acquire, is
it mineral, forest or agricultural? We only ask, is it agricultural? To ascertain whether it
is within the inhibition of section 5 of Article XIII.
The last question in turn resolves itself into what is understood by agricultural land.
Stripped of the special considerations which dictated the classification of public lands
into three general groups, there is no alternative but to take the term "agricultural land"
in its natural and popular signification; and thus regarded, it imports a distinct
connotation which involves no absurdity and no contradiction between different parts
of the organic law. Its meaning is that agricultural land is specified in section 5 of
Article XIII to differentiate it from lands that are used or are more suitable for purposes
other than agriculture.
It would profit us to take notice of the admonition of two of the most revered writers on
constitutional law, Justice Story and Professor Cooley:
"As a general thing, it is to be supposed that the same word is used in the same sense
wherever it occurs in a constitution. Here again, however, great caution must be
observed in applying an arbitrary rule; for, as Mr. Justice Story has well observed; `It
does not follow, either logically or grammatically, that because a word is found in one
connection in the Constitution with a definite sense, therefore the same is to be
adopted in every other connection in which it occurs. This would be to suppose that
the framers weighed only the force of single words, as philologists or critics, and not
whole clauses and objects, as statesmen and practical reasoners. And yet nothing has
been more common than to subject the Constitution to this narrow and mischievous
criticism. Men of ingenious and subtle minds, who seek for symmetry and harmony in
language, having found in the Constitution a word used in some sense which falls in
with their favorite theory of interpreting it, have made that the standard by which to
measure its use in every other part of the instrument. They have thus stretched it, as it
were, on the bed of Procrustes, lopping off its meaning when it seemed too large for
their purposes, and extending it, when it seemed too short. They have thus distorted it
to the most unnatural shapes, and crippled where they have sought only to adjust its
proportions according to their own opinions? And he gives many instances where, in
the National Constitution, it is very manifest the same word is employed in different
meanings. So that, while the rule may be sound as one of presumption merely, its
force is but slight, and it must readily give way to a different intent appearing in the
instrument." (1 Cooley's Constitutional Limitations, 8th ed., 135.)
As to the proposition that the words "agricultural lands" have been given a technical
meaning and that the Constitution has employed them in that sense, it can only be
accepted in reference to public lands. If a technical import has been affixed to the
term, it can not be extended to private lands if we are not to be led to an absurdity and
if we are avoid the charge that we are resorting to subtle and ingenious refinement to
force from the Constitution a meaning which its framers never held. While in the
construction of a constitution words must be given the technical meaning which they
have acquired, the rule is limited to the "well-understood meaning" "which the people
must be supposed to have had in view in adopting them." To give an example. "When
the constitution speaks of an ex post facto law, it means a law technically known by
that designation; the meaning of the phrase having become definite in the history of
constitutional law, and being so familiar to the people that it is not necessary to
employ language of a more popular character to designate it." In reality, this is not a
departure from the general rule that the language used is to be taken in the sense it
conveys to the popular mind, "for the technical sense in these cases is the sense
popularly understood, because that is the sense fixed upon the words in legal and
constitutional history where they have been employed for the protection of popular
rights." (1 Cooley's Constitutional Limitations, 8th ed., 132-133.) Viewed from this
angle, "agricultural land" does not possess the quality of a technical term. Even as
applied to public lands, and even among lawyers and judges, how many are familiar
with the decisions of this Court which hold that public swamps and public lands more
appropriate for buildings and other structures than for agriculture are agricultural
lands? The same can be truthfully said of members of the Constitutional Assembly.
The speeches of delegates Montilla and Ledesma cannot serve as a means of
interpretation. The sentiments expressed in those speeches, like the first drafts of
section 5 of Article XIII, may have reflected the sentiments of the Convention in the
first stages of the deliberation or down to its close. If they were, those sentiments were
relaxed and not given full sway for reasons on which we need not speculate.
Speeches in support of a project can be a valuable criterion for judging the intention of
a law or constitution only if no changes were afterward affected. If anything, the
change in section 5 of Article XIII wrought in the face of a strong advocacy for
complete and absolute nationalization of all lands, without exception, offers itself as
the best proof that to the framers of the Constitution the change was not "merely one
of words" but represented something real and substantial. Firm and resolute
convictions are expressed in a document in strong, unequivocal and unqualified
language. This is specially true when the instrument is a constitution, "the most
solemn and deliberate of human writings, always carefully drawn, and calculated for
permanent endurance."
The decision quotes from the Framing of the Constitution by Dean Aruego a sentence
which says that one of the principles underlying the provision of Article XIII of the
Constitution is "that lands, minerals, forests and other natural resources constitute the
exclusive heritage of the Filipino Nation." In underlying the word lands the Court wants
to insinuate that all lands without exceptions are included. This is nothing to be
enthusiastic over. It is hyperbole, "a figure of speech in which the statement expresses
more than the truth" but "is accepted as a legal form of expression." It is an expression
that "lies but does not deceive." When we say men must fight we do not mean all men,
and every one knows we don't.
The decision says:
It is true that in section 9 of said Commonwealth Act No. 141,"alienable or
disposable public lands" which are the same as "public agricultural lands"
under the Constitution, are classified into agricultural, residential,
commercial, industrial and for other purposes. This simply means that the
term "public agricultural lands" has both a broad and a particular meaning.
Under its broad or general meaning, as used in the Constitution, it
embraces all lands that are neither timber nor mineral. This broad meaning
is particularized in section 9 of Commonwealth Act No. 141 which classifies
"public agricultural lands" for purposes of alienation or disposition, into lands
that are strictly agricultural or actually devoted to cultivation for agricultural
purposes; lands that are residential; commercial; industrial; or lands for
other purposes. The fact that these lands are made alienable or disposable
under Commonwealth Act No. 141, in favor of Filipino Citizen, is a
conclusive indication of their character as public agricultural lands under
said statute and under the Constitution."
If I am not mistaken in my understanding of the line of reasoning in the foregoing
passage, my humble opinion is that there is no logical connection between the
premise and the conclusion. What to me seems clearly to emerge from it is that
Commonwealth Act No. 141, so far from sustaining that Court's theory, actually pulls
down its case which it has built upon the foundation of parallel classification of public
and private lands into forest, mineral and agricultural lands, and the inexistence of
such things as residential, industrial or commercial lands. It is to be noted that Act No.
141, section 9, classifies disposable lands into agricultural, industrial, residential,
commercial, etc. And these are lands of the public domain.
The fact that the provisions regarding alienation of private lands happens to be
included in Article XIII, which is entitled "Conservation and Utilization of Natural
Resources," is no ground for treating public lands and private lands on the same
footing. The inference should rather be the exact reverse. Agricultural lands, whether
public or private, are natural resources. But residential, commercial, and industrial
lands, as we have seen, are not natural resources either in the sense these words
convey to the popular mind or as defined in the dictionary. This fact may have been
one factor which prompted the elimination of private non-agricultural lands from the
range of the prohibition, along with reasons, of foreign policy, economics and politics.
From the opinion of Secretary of Justice Jose A. Santos in 1939, the majority can not
derive any comfort unless we cling to the serious argument that as public lands go so
go private lands. In that opinion the question propounded was whether a piece of
public land which was more profitable as a homesite might not be sold and considered
as agricultural. The illustrious Secretary answered yes, which was correct. But the
classification of private lands was not directly or indirectly involved. It is the opinion of
the present Secretary of Justice that is to the point. If the construction placed by the
law-officer of the government on a constitutional provision may properly be invoked,
as the majority say but which I doubt, as representing the true intent of the instrument,
this Court, if it is to be consistent, should adopt Secretary Ozaeta's view. If the
Solicitor General's attitude as interested counsel for the government in a judicial action
is — as the decision also suggests but which, I think, is still more incorrect both in
theory and in practice — then this Court should have given heed to the motion for
withdrawal of the present appeal, which had been concurred in by the Solicitor
General in line presumably with the opinion of the head of his department.
The Court fears that "this constitutional purpose of conserving agricultural resources in
the hands of Filipino citizens may easily be defeated by the Filipino citizens
themselves who may alienate their agricultural lands in favor of aliens." It reasons that
"it would certainly be futile to prohibit the alienation of public agricultural lands to
aliens if, after all, they may be freely so alienated upon their becoming private
agricultural lands in the hands of Filipino citizens." Sections122 and 123 of Act No.
141 should banish this fear. These sections, quoted and relied upon in the majority
opinion, prevent private lands that have been acquired under any of the public land
laws from falling into alien possession in fee simple. Without this law, the fear would
be well-founded if we adopt the majority's theory, which we precisely reject, that
agricultural and residential lands are synonymous, be they public or private. The fear
would not materialize under our theory, that only lands which are not agricultural may
be owned by persons other than FIlipino citizens.
Act No. 141, by the way, supplies the best argument against the majority's
interpretation of section 5 of Article XIII. Prohibiting the acquisition by foreigners of any
lands originally acquired in any manner under its provisions or under the provisions of
any previous law, ordinace, royal order, royal decree, or any other law formerly
enforced in the Philippines with regard to public lands, etc., it is a mute eloquent
testimony that in the minds of the legislature, whose interpretation the majority
correctly say should be looked to as authoritative, the Constitution did not carry such
prohibition. For if the Constitution already barred the alienation of lands of any kind in
favor of aliens, the provisions of sections 122 and 123 of Commonwealth Act No. 141
would have been superfluous.
The decision says that "if under Article XIV section 8, of the Constitution, an alien may
not even operate a small jeepney for hire, it is certainly not hard to understand that
neither is he allowed to own a piece of land." There is no similitude between owning a
lot for a home or a factory or a store and operating a jeepney for hire. It is not the
ownership of a jeepney that is forbidden; it is the use of it for public service that is not
allowed. A foreigner is not barred from owning the costliest motor cars, steamships or
airplanes in any number, for his private use or that of his friends and relatives. He can
not use a jeepney for hire because the operation of public utilities is reserved to
Filipino nationals, and the operation of a jeepney happens to be within this policy. The
use of a jeepney for hire maybe insignificant in itself but it falls within a class of
industry that performs a vital function in the country's economic life, closely associated
with its advancing civilization, supplying needs so fundamental for communal living
and for the development of the country's economy, that the government finds need of
subjecting them to some measure of control and the Constitution deems it necessary
to limit their operation by Filipino citizens. The importance of using a jeepney for hire
cannot be sneered at or minimized just as a vote for public office by a single foreign
citizen can not be looked at with a shrug of the shoulder on the theory that it would not
cause a ripple in the political complexion or scene of the nation.
This Court quotes with approval from the Solicitor General's brief this passage: "If the
term `private agricultural lands' is to be construed as not including residential lots or
lands of similar nature, the result will be that aliens may freely acquire and possess
not only residential lots and houses for themselves but entire subdivisions and whole
towns and cities, and that they may validly buy and hold in their names lands of any
area for building homes, factories, industrial plants, fisheries, hatcheries, schools,
health and vacation resorts, markets, golf — courses, playgrounds, airfields and a
host of other uses and purposes that are not, in appellant's words, strictly agricultural."
Arguments like this have no place where there is no ambiguity in the constitution or
law. The courts are not at liberty to disregard a provision that is clear and certain
simply because its enforcement would work inconvenience or hardship or lead to what
they believe pernicious results. Courts have nothing to do with inconvenience or
consequences. This role is founded on sound principles of constitutional government
and is so well known as to make citations of authorities presumptuous.
Granting the possibility or probability of the consequences which this Court and the Solicitor
General dread, we should not overlook the fact that there is the Congress standing guard to curtail
or stop such excesses or abuses if and when the menace should show its head. The fact that the
Constitution has not prohibited, as we contend, the transfer of private non-agricultural lands to
aliens does not prevent the Congress from passing legislation to regulate or prohibit such transfer,
to define the size of private lands a foreigner may possess in fee simple, or to specify the uses for
which lands may be dedicated, in order to prevent aliens from conducting fisheries, hatcheries,
vacation resorts, markets, golf-courses, cemeteries. The Congress could, if it wants, go so far as
to exclude foreigners from entering the country or settling here. If I may be permitted to guess, the
alteration in the original draft of section 5 of Article XIII may have been prompted precisely by the
thought that it is the better policy to leave to the political departments of the Government the
regulation or absolute prohibition of all land ownership by foreigners, as the changed, changing
and ever-changing conditions demand. The Commonwealth Legislature did that with respect to
lands that were originally public lands, through Commonwealth Act No. 141, and the Legislative
Assembly during the Japanese occupation extended the prohibition to all private lands, as Mr.
Justice Paras has pointed out. In the present Congress, at least two bills have been introduced
proposing Congressional legislation in the same direction. All of which is an infallible sign that the
Constitution does not carry such prohibition, in the opinion of three legislatures, an opinion which,
we entirely agree with the majority, should be given serious consideration by the courts (if needed
there were any doubt), both as a matter of policy, and also because it may be presumed to
represent the true intent of the instrument. (12 C.J., 714.) In truth, the decision lays special
emphasis on the fact that "many members of the National Assembly who approved the new Act
(No. 141) had been members of the Constitutional Convention." May I add that Senator Francisco,
who is the author of one of the bills I have referred to, in the Senate, was a leading, active and
influential member of the Constitutional Convention?
G.R. No. L-14787 January 28, 1961
COLGATE-PALMOLIVE PHILIPPINE, INC., petitioner,
vs.
HON. PEDRO M. GIMENEZ as Auditor General and ISMAEL MATHAY as
AUDITOR OF THE CENTRAL BANK OF THE PHILIPPINES, respondents.
Ross, Selph and Carrascoso for petitioner.
Office of the Solicitor General for respondents.
GUTIERREZ DAVID, J.:
The petitioner Colgate-Palmolive Philippines, Inc. is a corporation duly organized and
existing under Philippine laws engaged in the manufacture of toilet preparations and
household remedies. On several occasions, it imported from abroad various materials
such as irish moss extract, sodium benzoate, sodium saccharinate precipitated
calcium carbonate and dicalcium phosphate, for use as stabilizers and flavoring of the
dental cream it manufactures. For every importation made of these materials, the
petitioner paid to the Central Bank of the Philippines the 17% special excise tax on the
foreign exchange used for the payment of the cost, transportation and other charges
incident thereto, pursuant to Republic Act No. 601, as amended, commonly known as
the Exchange Tax Law.
On March 14, 1956, the petitioner filed with the Central Bank three applications for
refund of the 17% special excise tax it had paid in the aggregate sum of P113,343.99.
The claim for refund was based on section 2 of Republic Act 601, which provides that
"foreign exchange used for the payment of the cost, transportation and/or other
charges incident to the importation into the Philippines of . . . stabilizer and flavors . . .
shall be refunded to any importer making application therefor, upon satisfactory proof
of actual importation under the rules and regulations to be promulgated pursuant to
section seven thereof." After the applications were processed by the officer-in-charge
of the Exchange Tax Administration of the Central Bank, that official advised, the
petitioner that of the total sum of P113,343.99 claimed by it for refund, the amount of
P23,958.13 representing the 17% special excise tax on the foreign exchange used to
import irish moss extract, sodium benzoate and precipitated calcium carbonate had
been approved. The auditor of the Central Bank, however, refused to pass in audit its
claims for refund even for the reduced amount fixed by the Officer-in-Charge of the
Exchange Tax Administration, on the theory that toothpaste stabilizers and flavors are
not exempt under section 2 of the Exchange Tax Law.
Petitioner appealed to the Auditor General, but the latter or, December 4, 1958
affirmed the ruling of the auditor of the Central Bank, maintaining that the term
"stabilizer and flavors" mentioned in section 2 of the Exchange Tax Law refers only to
those used in the preparation or manufacture of food or food products. Not satisfied,
the petitioner brought the case to this Court thru the present petition for review.
The decisive issue to be resolved is whether or not the foreign exchange used by
petitioner for the importation of dental cream stabilizers and flavors is exempt from the
17% special excise tax imposed by the Exchange Tax Law, (Republic Act No. 601) so
as to entitle it to refund under section 2 thereof, which reads as follows:
SEC, 2. The tax collected under the preceding section on foreign exchange
used for the payment of the cost, transportation and/or other charges
incident to importation into the Philippines of rice, flour, canned milk, cattle
and beef, canned fish, soya beans, butterfat, chocolate, malt syrup, tapioca,
stabilizer and flavors, vitamin concentrate, fertilizer, poultry feed; textbooks,
reference books, and supplementary readers approved by the Board of
Textbooks and/or established public or private educational institutions;
newsprint imported by or for publishers for use in the publication of books,
pamphlets, magazines and newspapers; book paper, book cloth, chip board
imported for the printing of supplementary readers (approved by the Board
of Textbooks) to be supplied to the Government under contracts perfected
before the approval of this Act, the quantity thereof to be certified by the
Director of Printing; anesthetics, anti-biotics, vitamins, hormones, x-ray
films, laboratory reagents, biologicals, dental supplies, and pharmaceutical
drugs necessary for compounding medicines; medical and hospital supplies
listed in the appendix to this Act, in quantities to be certified by the Director
of Hospitals as actually needed by the hospitals applying therefor; drugs
and medicines listed in the said appendix; and such other drugs and
medicines as may be certified by the Secretary of Health from time to time
to promote and protect the health of the people of the Philippines shall be
refunded to any importer making application therefor, upon satisfactory
proof of actual importation under the rules and regulations to be
promulgated pursuant to section seven thereof." (Emphasis supplied.)
The ruling of the Auditor General that the term "stabilizer and flavors" as used in the
law refers only to those materials actually used in the preparation or manufacture of
food and food products is based, apparently, on the principle of statutory construction
that "general terms may be restricted by specific words, with the result that the general
language will be limited by the specific language which indicates the statute's object
and purpose." (Statutory Construction by Crawford, 1940 ed. p. 324-325.) The rule,
however, is, in our opinion, applicable only to cases where, except for one general
term, all the items in an enumeration belong to or fall under one specific class. In the
case at bar, it is true that the term "stabilizer and flavors" is preceded by a number of
articles that may be classified as food or food products, but it is likewise true that the
other items immediately following it do not belong to the same classification. Thus
"fertilizer" and "poultry feed" do not fall under the category of food or food products
because they are used in the farming and poultry industries, respectively. "Vitamin
concentrate" appears to be more of a medicine than food or food product, for, as
matter of fact, vitamins are among those enumerated in the list of medicines and
drugs appearing in the appendix to the law. It should also here be stated that "cattle",
which is among those listed preceding the term in question, includes not only those
intended for slaughter but also those for breeding purposes. Again, it is noteworthy
that under, Republic Act No. 814 amending the above-quoted section of Republic Act
No. 601, "industrial starch", which does not always refer to food for human
consumption, was added among the items grouped with "stabilizer and flavors". Thus,
on the basis of the grouping of the articles alone, it cannot validly be maintained that
the term "stabilizer and flavors" as used in the above-quoted provision of the
Exchange Tax Law refers only to those used in the manufacture of food and food
products. This view is supported by the principle "Ubi lex non distinguish nec nos
distinguire debemos", or "where the law does not distinguish, neither do we
distinguish". (Ligget & Myers Tobacco Company vs. Collector of Internal Revenue, 53
Off. Gaz. No. 15, page 4831). Since the law does not distinguish between "stabilizer
and flavors" used in the preparation of food and those used in the manufacture of
toothpaste or dental cream, we are not authorized to make any distinction and must
construe the words in their general sense. The rule of construction that general and
unlimited terms are restrained and limited by particular recitals when used in
connection with them, does not require the rejection of general terms entirely. It is
intended merely as an aid in ascertaining the intention of the legislature and is to be
taken in connection with other rules of construction. (See Handbook of the
Construction and Interpretation of Laws by Black, p. 215.216, 2nd ed.)

Having arrived at the above conclusion, we deem it now idle to pass upon the other
questions raised by the parties.

WHEREFORE, the decision under review is reversed and the respondents are hereby
ordered to audit petitioners applications for refund which were approved by the
Officer-in-Charge of the Exchange Tax Administration in the total amount of
P23,958.13.

Bengzon, Bautista Angelo, Concepcion, Reyes, J.B.L., Barrera, Paredes and Dizon,
JJ., concur.
Labrador, J., reserves his vote.
G.R. No. 101976 January 29, 1993
THE COMMISSIONER OF INTERNAL REVENUE, petitioner,
vs.
THE COMMISSION ON AUDIT, respondent.
G.R. No. 102258 January 29, 1993
TIRSO B. SAVELLANO, petitioner,
vs.
THE COMMISSION ON AUDIT, respondent.
Law Firm of Armando A. Armovit for petitioner in G.R. No. 102258.
NARVASA, C.J., J.:
The issues joined in these consolidated petitions focus, as it were, on the
general audit jurisdiction of the Commission of Audit vis-a-vis the Bureau of
Internal Revenue's power to determine entitlement to the tax informer's reward
under Section 3161 of the National Internal Revenue Code.
On June 25, 1986, petitioner Tirso B. Savellano furnished the Bureau of Internal
Revenue (BIR) with a confidential affidavit of information2 denouncing the
National Coal Authority (NCA) and the Philippine National Oil Company (PNOC) for
non-payment of taxes totalling P234 Million on interest earnings of their respective
money placements with the Philippine National Bank (PNB) since October 15, 1984 to
said date. Investigation by the BIR confirmed the reported tax liabilities, and upon
demands thereafter made, NCA and PNOC paid to the BIR the following amounts of
taxes corresponding to the period October 15, 1984 to August 31, 1986:
NCA Schedule of Payments
Confirmation Receipt No. Date of Payment Amount Paid
B6402543 9-10-86 P 1,067,682.86
B7373646 10-15-86 14,918,482.19
——————
Total P15,986,165.05
PNOC Schedule of Payments
Confirmation Receipt No Date of Payment Amount Paid
B6402542 9-10-86 P 2,952,349.23
B12581298 6-30-87 31,003,129.89
B12581904 7-31-87 30,000,000.00
B12601251 10-01-87 30,000,000.00
— ——————
Total P93,955,479.12
By a letter dated November 28, 1986, then BIR Commissioner Bienvenido Tan, Jr.
recommended to the Minister of Finance payment to petitioner Savellano of an
informer's reward equivalent to 15% of the amount of P15,986,165.00 paid by NCA, or
P2,397,924.75.3 Said recommendation having been favorably passed upon by the
Committee on Rewards of the Department of Finance, the same was approved by
then Deputy Minister of Finance Alfredo Pio de Roda, Jr.;4 and Savellano was in due
time paid the aforesaid amount.
The records do not show when the informer's reward in the PNOC case was
recommended for payment; only that it was approved by then Finance Undersecretary
Marcelo Fernando.5 Petitioner Savellano was paid his informer's reward in the PNOC
case in the total amount of P14,093,321.89 in four (4) installments, the last of them on
December 1, 1987.6
On February 8, 1989, respondent Commission on Audit (COA) rendered COA
Decision No. 7407 disallowing in audit the payment of informer's reward to petitioner
Savellano in the NCA case on the ground that payment of an informer's reward under
Section 281 of the National Internal Revenue Code is conditioned upon the actual
recovery or collection of revenues, and no such revenue or income was actually
realized or recovered on any benefit accrued to the government, since two (2)
government agencies were involved. The income realized by the BIR out of the
withholding taxes paid by the NCA was a reduction of the income of the latter,
resulting in a zero effect in revenues realized or recovered. Respondent COA also
impugned the propriety of the claim for informer's reward based on inter-governmental
violations. In its view, allowance of claims of the kind would not only place a premium
upon violations committed by government agencies but also induce collusion among
government offices in order to obtain the informer's reward. It reasoned that if the
State cannot be held responsible for the tortious acts of its employees unless the latter
acted as special agents, with more reason it should not be held liable to pay informer's
reward upon violations committed by government agencies.8
Petitioner Commissioner of Internal Revenue sought reconsideration of COA Decision
No. 740. He was followed by petitioner Tirso Savellano and Mrs. Potenciana
Evangelista, former Chief of the BIR Accounting Division after the COA Resident
Auditor issued Revised Certificate of Settlement and Balances (CSB) No. 89-0001-
104(c) dated July 20, 1989,9 directing the withholding of salaries or any amount due
them and to the following BIR officials/employees/persons who were being held
personally liable for the disallowed amount of P11,397,924.75:10
Atty. Jaime Maza, Chief, Legal Division
Mrs. Potenciana Evangelista, Chief, Rev. Acctg. Division
Mr. Jesus Parado, Chief, Personnel & Adm. Office
Atty. Vicente Y. Puno, Asst. Commissioner, Personnel & Adm.
Mr. Marcelo N. Fernando, Undersecretary of Finance
Mr. Eufracio Santos, Deputy Commissioner, BIR
Mr. Jose A. Resurreccion, Asst. Commissioner, Administrative
Ms. Marilyn Soledad, Researcher, Legal Division
Atty. Alicia P. Clemeno, Chief, Law Division
Mr. Melchor S. Ramos, Chief, Financial & Mgt.
Mrs. Elena C. Pineda, Special Disbursing Officer.
These pleas were denied due course in COA Decision No. 1930, 11 denying due
course to the requests for reconsideration. Hence, these separate petitions, which
were ordered consolidated in the Court's Resolution dated March 10, 1992 in G.R. No.
102258.12
In seeking nullification of COA Decisions Nos. 740 and 1930 in G.R. No. 101976,
petitioner Commissioner of Internal Revenue argues that: the approval by the
Department of Finance of the claim for informer's reward of petitioner Savellano is
conclusive upon the executive agencies concerned, respondent COA included, as it
constitutes the final determination of the proper administrative authority under Section
90 of the Government Auditing Code of the Philippines; there were actual cash
collections of P109,941,644.17 from NCA and PNOC for non-payment of withholding
taxes on interest earnings, which amount had accrued to the General Fund; Section
316 (now 281) of the National Internal Revenue Code (NIRC) entitling an informer to a
reward for information leading to the collection of internal revenue taxes is clear and
needs no interpretation; and assuming that it does, it should be interpreted in favor of
the informer; NCA and PNOC have separate personalities from the Bureau of Internal
Revenue as well as the Government and the State; and superior and subordinate
officers of the government are not civilly liable for acts done in the performance of their
official duties.
For his part, petitioner Tirso Savellano questions the COA disallowance on the ground
that the express statutory grant to BIR of the power to allow or disallow claims for
payment of tax informer's reward is an implied statutory denial of the same power to
the COA, which would otherwise transform said respondent into "a super tax authority"
and "undermine and dilute the substance and efficacy of the very entity created and
empowered by law to collect taxes and augment the government's revenue collecting
potentials"13 He further maintains that there was "actual" collection of tax by the BIR
from the NCA and PNOC because while said agencies are government-owned
corporations, they derive their income from the exercise of
corporate/proprietary/private functions, which does not, in and by itself, constitute
public funds. It is only when such income is taxed that whatever part thereof
corresponds to the amount of the tax becomes part of the national treasury, thereby
redounding to the benefit of the government.
Required to comment on the petition in G.R. No. 101976, and later, on the petition in
G. R. No. 102258, the Solicitor General begged off on the ground that "its position is
different from the stand taken by respondent Commission on Audit (COA) in the
present case" and sought to be excused from further representing respondent COA, in
whose behalf he prayed for a reasonable period of time to file its own comment. 14 In
its Resolution of January 16, 1992 in G.R. No. 101976, this Court noted the Solicitor
General's manifestation, excused him from further representing respondent COA in
the case and required the latter to file its own comment within ten (10) days from
notice.15 In G.R. No. 102258, however, the Court denied a similar plea. It required the
Solicitor General to explain within ten (10) days from notice why his position was
different from COA's, and gave said respondent a period of ten (10) days to file its
comment on the petition, if it so desired. 16
Briefly put, the Solicitor General's explanation is that he found COA's disallowance of
the informer's reward erroneous because: government corporations are subject to tax
under the NIRC; having personalities distinct from the government, if they evade
payment of their taxes, the amounts corresponding to such liabilities could be utilized
for purposes exclusive to them; contrarily, if they do pay their taxes, the amounts so
paid accrue to the General Fund; Section 281 of the NIRC does not make any
distinction among taxpayers from whom taxes are eventually recovered; it simply
prescribes that for an informer to be entitled to the reward, the information he
furnishes should result in the recovery of revenues; statutes offering reward must be
liberally construed in favor of informers; the possibility of collusion is not sufficient
basis for disallowance, since collusion cannot be assumed, while the official acts of
the BIR and the Department of Finance are entitled to a presumption of regularity;
even if the taxpayers referred to by an informer are private entities, the possibility of
collusion still remains; such a consideration, moreover, goes into the wisdom of the
law a matter that concerns the legislature and not the courts, much less, COA; and
there being no evidence of any irregularity, the determination made by the BIR should
be binding upon COA pursuant to the Government Auditing Code.
Respondent COA questions the personality of petitioner Commissioner of Internal
Revenue to bring the instant suit, arguing that the Commissioner is not an aggrieved
party adversely affected by the assailed decisions. In justification of its actions, COA
invokes its constitutionally-vested audit jurisdiction over all government agencies, to
which, it contends, the statutorily granted power of the Secretary of Finance under
Section 90, P.D. 1445 must yield. It insists that petitioner Savellano is not entitled to
the informer's reward because there was no actual collection of revenues under the
benefit-to-the-government rule; and Savellano's alleged information did not lead to the
discovery of a fraud. It characterizes the payment of informer's reward as irregular,
being predicated upon violations committed by government agencies, and would have
the persons named in CSB No. 89-0001-104 (c) held liable for participation in illegal or
irregular disbursements of public funds by reason of their respective duties.
The Commissioner of Internal Revenue, in assailing respondent COA's authority to
disallow the payment of informer's reward, relies heavily on Section 90 of P.D. No.
1445, otherwise known as the "Government Auditing Code of the Philippines." A
reading of said provision, which is quoted hereunder, shows that such reliance is
misplaced:
 Sec. 90. Payment of rewards. — When a reward becomes
payable by authority of law for information given relative to any
offense or for any act done in connection with the apprehension of
the offender, the reward shall, in the absence of special
provisions, be paid in such manner as shall be prescribed by
executive order. The final determination by the proper
administrative authority pursuant to law or any such order, as to
whether or not the persons concerned are entitled to any reward
and the amount thereof, shall be conclusive upon the executive
agencies concerned as regards the liability of the government.
The final determination by the Department of Finance, through the recommendation of
the BIR, of petitioner Savellano's entitlement to the informer's reward is, under Section
90, conclusive only upon the executive agencies concerned. Respondent COA is not
an executive agency. It is one of the three (3) independent constitutional
commissions.17 Specifically, it is the constitutional agency vested with the "power,
authority and duty to examine, audit and settle all accounts pertaining to the revenue
and receipts of, and expenditures or uses of funds and property owned or held in trust
by . . . the government, or any of its subdivisions, agencies or instrumentalities. . .
."18 To ensure the effective discharge of its functions, it has been empowered, subject
to the limitations imposed by Article IX (D) of the 1987 Constitution, to define the
scope of its audit and examination, establish the techniques and methods required
therefor, and promulgate accounting and auditing rules and regulations, including
those for the prevention and disallowance of irregular, unnecessary, excessive,
extravagant or unconscionable expenditures or uses of government funds and
properties.19
The final determination made by the Finance Department cannot bind respondent
COA or foreclose its review thereof in the exercise of its constitutional function and
duty to ensure that public funds are expended and used in conformity with law. To
hold otherwise would be to ignore the clear mandate and the equally clear implications
of Section 3, Article IX (D)of the 1987 Constitution providing that:
No law shall be passed exempting any entity of the government of
its subsidiary in any guise whatever, or any investment of public
funds, from the jurisdiction of the Commission on Audit.
The exercise by respondent COA of its general audit power is among the
constitutional mechanisms that give life to the check-and-balance system inherent in a
republican form of government such as ours. Taken in this light, such exercise cannot
be regarded as an unlawful or unwarranted invasion of, or interference with, the
authority and power of the executive agency concerned to determine whether or not a
person is entitled to a reward provided by law and the amount thereof. As held
in Dingcong vs. Guingona, Jr., et al:
Constitutional Law; Administrative Law; Power and authority of
COA. — Not only is the Commission on Audit (COA) vested with
the power and authority, but it is also charged with the duty, to
examine, audit and settle all accounts pertaining to . . . the
expenditures or uses of funds . . . owned by, or pertaining to, the
Government or any of its subdivisions, agencies, or
instrumentalities (Article IX [D], Section 2[1], 1987 Constitution).
That authority extends to the accounts of all persons respecting
funds or properties received or held by them in an accountable
capacity (Section 26, P.D. No. 1445). In, the exercise of its
jurisdiction, it determines whether or not the fiscal responsibility
that rests directly with the head of the government agency has
been properly and effectively discharged (Section 25[l], ibid.), and
whether or not there has been loss or wastage of government
resources. It is also empowered to review and evaluate contracts
(Section 18[4], ibid.). And, after an audit has been made, its
auditors issue a certificate of settlement to each officer whose
account has been audited and settled in whole or in part, stating
the balances found due thereon and certified, and the charges or
differences arising from the settlement by reason of
disallowances, charges or suspensions (Section 82, ibid.).
This is not to say, however, that the disallowance in audit by respondent COA is in
itself final. The same may be set aside and nullified by this Court, if done with grave
abuse of discretion.
The informer's reward granted to petitioner Savellano is based on Section 316 (now
281) of the National Internal Revenue Code.20 It reads:
Sec. 281. Informers reward to persons instrumental in the
discovery of violation of the National Internal Revenue Code and
in the discovery and seizure of smuggled goods.
(1) For violation of the National Internal Revenue Code. Any
person except an internal revenue official or employee, or other
public official, or his relative within the sixth grade of
consanguinity, who voluntarily gives definite and sworn
information, not yet in the possession of the Bureau of Internal
Revenue, leading to the discovery of frauds upon internal revenue
laws or violation of any of the provisions thereof, thereby resulting
in the recovery of revenues, surcharges and fees and/or the
conviction of the guilty party and/or imposition of any fine or
penalty, shall be rewarded in the sum equivalent to fifteen per
centum of the revenues, surcharges or fees recovered and/or fine
or penalty imposed and collected. The same amount of reward
shall also be given to an informer where the offender has offered
to compromise the violation of law committed by him and his offer
has been accepted by the Commissioner and in such a case, the
fifteen per centum reward fixed herein shall be based on the
amount agreed upon in the compromise and collected from the
offender; Provided, That should no revenues, surcharges or fees
 be actually recovered or collected, such person shall not be
entitled to a reward: Provided, further, That the information
mentioned herein shall not refer to a case already pending or
previously investigated or examined by the Commissioner or any
of his deputies, agents or examiners, or the Secretary of Finance
or any of his deputies or agents: Provided, finally, That the reward
provided herein shall be paid under the regulations issued by the
Commissioner of Internal Revenue with the approval of the
Secretary of Finance.
One of the reasons for respondent COA's disallowance of the informer's reward under
consideration is that there was actually no revenue realized or recovered as two (2)
government agencies were involved. This view is simplistic and merits no
concurrence. It overlooks the fact that the two (2) government agencies involved, NCA
and PNOC, possess legal personalities separate and distinct from the Philippine
government. Although both are government-owned and controlled corporations, NCA
and PNOC perform proprietary functions. Their revenues do not automatically devolve
to the general coffers of the government. Unless transferred to the Philippine
government through the vehicle of taxation, no part of their revenues is available for
appropriation by the Legislature for expenditure in government projects; such
revenues remain said agencies' in their entirety, to be applied to and expended for
their own exclusive purpose. Clearly, then, when said revenues are subjected to tax,
the portion thereof corresponding to such tax becomes, in its own, revenue for the
government accruing to the General Fund.
That the informer's reward was sought and given in relation to tax delinquencies of
government agencies provides no reason for disallowance. The law on the matter
makes no distinction whatsoever between delinquent taxpayers in this regard, whether
private persons or corporations, or public or quasi-public agencies, it being sufficient
for its operation that the person or entity concerned is subject to, and violated,
revenue laws, and the informer's report thereof resulted in the recovery of revenues. It
is elementary that where the law does not distinguish, none must be made. Ubi lex
non distinguit nec nos distinguere debemos.21
The Solicitor General correctly dismisses the mere possibility of collusion to obtain the
informer's reward as sufficient ground for disallowance. Collusion cannot be
presumed. It must be proved by clear and convincing evidence. In the case at bar,
there is no showing of collusion between petitioner Savellano as informer and any
official or employee of the BIR or the Department of Finance. Neither is there any
evidence to overcome the presumption of regularity22 enjoyed by the official acts of the
BIR and the Department of Finance in approving the claim of petitioner Savellano for
informer's reward.
Respondent COA considers the payment of informer's reward in this case as placing a
premium upon violations committed by government agencies and therefore, improper.
At first blush, it would appear that by paying the informer's reward, the government
punishes itself for violations committed by its own agencies. This, however, is more
apparent than real. The delinquencies of these agencies are not condoned, much less
rewarded. It is the person whose information led to the discovery of their
transgressions who is being rewarded. Although this results in a reduction in the
amount of revenues actually received, the net effect is that the government still gains
from the remaining amount paid, which otherwise would have been lost to it.
WHEREFORE, the consolidated petitions are hereby GRANTED. The assailed
decisions of respondent Commission on Audit are set aside. No pronouncement as to
costs.
SO ORDERED.
Gutierrez, Jr., Cruz, Feliciano, Bidin, Griño-Aquino, Regalado, Davide, Jr., Romero,
Nocon, Bellosillo, Melo and Campos, Jr., JJ., concur.
Separate Opinions
PADILLA, J., dissenting:
I regret that I cannot join in the majority opinion. It is unfortunate that the literal and, if I
may add, quite hasty application of a rule of statutory construction should result in loss
of revenue to the government in an amount of SIXTEEN MILLION PESOS
(P16,000,000.00), more or less, by way of a tax informer's reward.
The majority, while conceding that "Although this (the informer's reward) results in a
reduction in the amounts of revenues actually received," in the same sentence,
justifies the informer's reward in favor of petitioner Tirso B. Savellano by stating that
"the net effect is that the government still gains from the remaining amount paid, which
otherwise would have been lost to it."
I really fail to perceive how the government stands to gain from this operation. To me,
it is merely a case of transferring government funds from government-owned
corporations (the NCA and the PNOC) to the BIR, in the form of taxes, which in turn
diminishes the funds of said government corporations, whether intended for
operations or dividends. Actually, therefore, it is a transfer of government funds from
one pocket to another, and in the process, an informer is paid a reward of P16 million
pesos. This situation would, of course, not exist were the NCA and
PNOC private individuals or entities. Their payment of taxes to the government would
constitute a definite gain to the government since, in the exercise, no reduction of
government funds (but of private funds) results. An informer's reward in such a case
would be in order. I am really apprehensive that the exercise or process which this
Court, in effect now sanctions, would be, as the saying goes, "to fry one (the
government) in its own lard."
Moreover, the resulting loss (or reduction) of revenue to the government referred to (in
the tax informer's reward) appears to be the result of the application of Section 316
(now 281) of the National Internal Revenue Code in isolation, without considering the
Constitution, to which all laws are subordinate and to which every law must
harmonize.
The 1987 Constitution provides that:
The Commission on Audit shall have the power, authority, and
duty to examine, audit, and settle all accounts pertaining to the
revenue and receipts of, and expenditures or uses of funds and
property, owned or held in trust by, or pertaining to, the
Government, or any of its subdivisions, agencies or
instrumentalities, including government-owned or controlled
corporations with original charters, and on a post-audit basis: . . .
c) other government-owned or controlled corporations and their
subsidiaries.1
It cannot be denied that under the aforequoted Constitutional provision, the NCA and
PNOC are both subject to audit by the COA. The intent of the Constitution is clear.
The Commission on Audit is the office which possesses the mechanism by which the
accounts of all government bodies and agencies are evaluated and examined. The
mechanism necessarily includes the determination of whether or not the correct taxes
have been paid by them to the Bureau of Internal Revenue. The two (2) government
agencies involved, the COA and BIR, can readily and regularly determine the correct
taxes due from such government entities. The situation in the case of purely private
taxpayers is quite different, since there is no regular audit done on them by the
government, through the COA. It is from this perspective that we should begin to
determine whether or not the informer's reward should be awarded in the cases at bar.
Presidential Decree No. 1773 which increased the informer's reward, in its preamble,
states:
WHEREAS, it is necessary to amend further certain provisions of
the National Internal Revenue Code in order to strengthen the
enforcement powers of the Bureau of Internal Revenue;
It would appear logical to conclude that the "enforcement powers" sought to be
strengthened by increasing the informer's reward refers to cases involving purely
private taxpayers since no less than the Constitution has provided for its own
"informer" in the case of government entity-taxpayers. This "informer" is, of course, the
Commission on Audit not to mention the officials of the very government entity-
taxpayers concerned who are all presumed to be regularly performing their duties.
The need for an informer not being present in the case at bar, the provision
concerning the informer's reward should not apply. It would, in my view, be absurd to
presume that the law-making body intended the statutory provision to apply to a
situation where its application would not serve any purpose. This is specially true
when the disbursement of public funds is involved and the Court, in the case
of Alliance of Government Workers, et al. v. The Honorable Minister of Labor, et
al.2 had occasion to emphasize that:
It is an old rule of statutory construction that restrictive statutes
and acts which impose burdens on the public treasury or which
diminish rights and interests, no matter how broad their terms do
not embrace the Sovereign, unless the sovereign is specifically
mentioned.
While Petitioner, Tirso B. Savellano should be commended for his concern for the
public interest, the informer's reward does not apply under the circumstances and
should not be awarded for the reasons discussed above.
I therefore vote to DENY the consolidated petitions and further vote for the non-
payment of the informer's reward in both cases, such award being contrary to law and
jurisprudence.
# Separate Opinions
PADILLA, J., dissenting:
I regret that I cannot join in the majority opinion. It is unfortunate that the literal and, if I
may add, quite hasty application of a rule of statutory construction should result in loss
of revenue to the government in an amount of SIXTEEN MILLION PESOS
(P16,000,000.00), more or less, by way of a tax informer's reward.
The majority, while conceding that "Although this (the informer's reward) results in a
reduction in the amounts of revenues actually received," in the same sentence,
justifies the informer's reward in favor of Petitioner Tirso B. Savellano by stating that
"the net effect is that the government still gains from the remaining amount paid, which
otherwise would have been lost to it."
I really fail to perceive how the government stands to gain from this operation. To me,
it is mere a case of transferring government funds from government-owned
corporations (the NCA and the PNOC) to the BIR, in the form of taxes, which in turn
diminishes the funds of said government corporations, whether intended for
operations or dividends. Actually, therefore, it is a transfer of government funds from
one pocket to another, and in the process, an informer is paid a reward of P16 million
pesos. This situation would, of course, not exist were the NCA and
PNOC private individuals or entities. Their payment of taxes to the government would
constitute a definite gain to the government since, in the exercise, no reduction of
government funds (but of private funds) results. An informer's reward in such a case
would be in order. I am really apprehensive that the exercise or process which this
Court, in effect now sanctions, would be, as the saying goes, "to fry one (the
government) in its own lard."
Moreover, the resulting loss (or reduction) of revenue to the government referred to (in situation where its application would not serve any purpose. This is specially true
the tax informer's reward) appears to be the result of the application of Section 316 when the disbursement of public funds is involved and the Court, in the case
(now 281) of the National Internal Revenue Code in isolation, without considering the of Alliance of Government Workers, et al. v. The Honorable Minister of Labor, et
Constitution, to which all laws are subordinate and to which every law must al.2 had occasion to emphasize that:
harmonize.
It is an old rule of statutory construction that restrictive statutes
The 1987 Constitution provides that: and acts which impose burdens on the public treasury or which
diminish rights and interests, no matter how broad their terms do
not embrace the Sovereign, unless the sovereign is specifically
The Commission on Audit shall have the power, authority, and
mentioned.
duty to examine, audit, and settle all accounts pertaining to the
revenue and receipts of, and expenditures or uses of funds and
property, owned or held in trust by, or pertaining to, the While Petitioner, Tirso B. Savellano should be commended for his concern for the
Government, or any of its subdivisions, agencies or public interest, the informer's reward does not apply under the circumstances and
instrumentalities, including government-owned or controlled should not be awarded for the reasons discussed above.
corporations with original charters, and on a post-audit basis: . . .
c) other government-owned or controlled corporations and their
I therefore vote to DENY the consolidated petitions and further vote for the non-
subsidiaries.1
payment of the informer's reward in both cases, such award being contrary to law and
jurisprudence.
It cannot be denied that under the aforequoted Constitutional provision, the NCA and
PNOC are both subject to audit by the COA. The intent of the Constitution is clear.
The Commission on Audit is the office which possesses the mechanism by which the
accounts of all government bodies and agencies are evaluated and examined. The
mechanism necessarily includes the determination of whether or not the correct taxes
have been paid by them to the Bureau of Internal Revenue. The two (2) government
agencies involved, the COA and BIR, can readily and regularly determine the correct
taxes due from such government entities. The situation in the case of purely private
taxpayers is quite different, since there is no regular audit done on them by the
government, through the COA. It is from this perspective that we should begin to
determine whether or not the informer's reward should be awarded in the cases at bar.

Presidential Decree No. 1773 which increased the informer's reward, in its preamble,
states:

WHEREAS, it is necessary to amend further certain provisions of

the National Internal Revenue Code in order to strengthen the
enforcement powers of the Bureau of Internal Revenue;

It would appear logical to conclude that the "enforcement powers" sought to be

strengthened by increasing the informer's reward refers to cases involving purely
private taxpayers since no less than the Constitution has provided for its own
"informer" in the case of government entity-taxpayers. This "informer" is, of course, the
Commission on Audit not to mention the officials of the very government entity-
taxpayers concerned who are all presumed to be regularly performing their duties.

The need for an informer not being present in the case at bar, the provision
concerning the informer's reward should not apply. It would, in my view, be absurd to
presume that the law-making body intended the statutory provision to apply to a
 [G.R. No. 137004. July 26, 2000.]
ARNOLD V. GUERRERO, Petitioner, v. THE COMMISSION ON
ELECTIONS, HON. MANUEL B. VILLAR, JR., as the Speaker of the
House of Representatives, 11th Congress, HON. ROBERTO P.
NAZARENO, as the Secretary General of the House of
Representatives, 11th Congress, RODOLFO C. FARIÑAS and
GUILLERMO R. RUIZ, Respondents.
DECISION
QUISUMBING, J.:
Before the Court is a petition for certiorari, prohibition, and mandamus,
with prayer for a temporary restraining order and/or preliminary injunction,
under Rule 65 of the Rules of Court. It assails the Order of the Commission
on Elections, Second Division, dated May 10, 1998, in COMELEC Case No.
SPA 98-227, which dismissed the petition filed by herein respondent
Guillermo C. Ruiz to disqualify respondent Rodolfo C. Fariñas as a
candidate for the elective office of Congressman in the first district of
Ilocos Norte during the May 11, 1998 elections. It also assails the
Resolution dated May 16, 1998, of the COMELEC En Banc, denying the
motion for reconsideration filed by respondent Ruiz and dismissing the
petition-in-intervention filed by herein petitioner Arnold V.
Guerrero.chanrob1es virtua1 1aw 1ibrary
In the Second Division of the COMELEC, Ruiz sought to perpetually
disqualify respondent Fariñas as a candidate for the position of
Congressman. 1 Ruiz alleged that Fariñas had been campaigning as a
candidate for Congressman in the May 11, 1998 polls, despite his failure to
file a Certificate of Candidacy for said office. Ruiz averred that Fariñas’
failure to file said Certificate violated Section 73 of the Omnibus Election
Code 2 in relation to COMELEC Resolution No. 2577, dated January 15,
1998. Ruiz asked the COMELEC to declare Fariñas as a "nuisance
candidate" pursuant to Section 69 of the Omnibus Election Code 3 and to
disqualify him from running in the May 11, 1998 elections, as well as in all
future polls.
On May 8, 1998, Fariñas filed his Certificate of Candidacy with the
COMELEC, substituting candidate Chevylle V. Fariñas who withdrew on
April 3, 1998.
On May 9, 1998, Ruiz filed an "Urgent Ex-Parte Motion To Resolve Petition"
with the COMELEC, attaching thereto a copy of the Certificate of Candidacy
of Fariñas.
On May 10, 1998, the Second Division of the COMELEC decided Case No.
SPA 98-227, disposing as follows:jgc:chanrobles.com.ph
"WHEREFORE, premises considered, the Commission (Second Division)
RESOLVES to DISMISS the instant petition for utter lack of
merit.chanrob1es virtua1 1aw 1ibrary
"SO ORDERED." 4
In dismissing Ruiz’s petition, the Second Division of the COMELEC stated,"
[T]here is none (sic) in the records to consider respondent an official
candidate to speak of without the filing of said certificate. Hence, there is
no certificate of candidacy to be cancelled, consequently, no candidate to
be disqualified." 5
On May 11, 1998, the elections pushed through as scheduled. The post-
election tally of votes in Ilocos Norte showed that Fariñas got a total of
56,369 votes representing the highest number of votes received in the first
district. Fariñas was duly proclaimed winner.
On May 16, 1998, Ruiz filed a motion for reconsideration, contending that
Fariñas could not validly substitute for Chevylle V. Fariñas, since the latter
was not the official candidate of the Lakas ng Makabayan Masang Pilipino
(LAMMP), but was an independent candidate. Another person cannot
substitute for an independent candidate. Thus, Fariñas’ certificate of
candidacy claiming to be the official candidate of LAMMP in lieu of Chevylle
V. Fariñas was fatally defective, according to Ruiz.
On June 3, 1998, Fariñas took his oath of office as a member of the House
of Representatives.
On June 10, 1998, petitioner herein filed his "Petition-In-Intervention" in
COMELEC Case No. SPA 98-227. Petitioner averred that he was the official
candidate of the Liberal Party (LP) in said elections for Congressman, and
stood to be adversely affected by Case No. SPA 98-227. Guerrero
contended that Fariñas, having failed to file his Certificate of Candidacy on
or before the last day therefor, being midnight of March 27, 1998, Fariñas
illegally resorted to the remedy of substitution provided for under Section
77 of the Omnibus Election Code 6 and thus, Fariñas’ disqualification was in
order. Guerrero then asked that the position of Representative of the first
district of Ilocos Norte be declared vacant and special elections called for,
but disallowing the candidacy of Fariñas.
On January 6, 1999, the COMELEC En Banc dismissed Ruiz’s motion for
reconsideration and Guerrero’s petition-in-intervention in Case No. SPA 98-
227. The decretal portion of its Resolution reads:jgc:chanrobles.com.ph
"PRESCINDING FROM THE FOREGOING PREMISES, this Commission (En
Banc) RESOLVED, as it hereby RESOLVES, to AFFIRM the Order of the
Commission (Second Division) and thereafter, DISMISS this instant motion
for reconsideration for lack of jurisdiction (italics in the original) without
prejudice to the filing of a quo warranto case, if he so desires.
"SO ORDERED." 7
Hence, the instant petition, anchored on the following grounds:chanrob1es
virtual 1aw library
A. THE RESPONDENT COMELEC GRAVELY ABUSED ITS DISCRETION AND
ACTED IN EXCESS AND/OR WITHOUT JURISDICTION IN REFUSING TO
RULE ON THE VALIDITY OR INVALIDITY OF THE CANDIDACY OR
PURPORTED CERTIFICATE OF CANDIDACY OF PRIVATE RESPONDENT
FARIÑAS.
B. THE RESPONDENT COMELEC GRAVELY ABUSED ITS DISCRETION AND
ACTED IN EXCESS AND/OR WITHOUT JURISDICTION IN TOSSING THE
DUTY TO RULE ON THE VALIDITY OR INVALIDITY OF THE CANDIDACY OR
PURPORTED CERTIFICATE OF CANDIDACY OF PRIVATE RESPONDENT
FARIÑAS TO THE HOUSE OF REPRESENTATIVES ELECTORAL TRIBUNAL
(HRET) CONSIDERING THAT THE LATTER (HRET) OBVIOUSLY LACKS
JURISDICTION TO RULE ON THE ISSUE THEREBY UNDULY CREATING A
VACUUM AND RENDERING PETITIONER WITHOUT A REMEDY.
C. THE RESPONDENT COMELEC GRAVELY ABUSED ITS DISCRETION AND
ACTED IN EXCESS AND/OR WITHOUT JURISDICTION IN NOT RENDERING
A RULING, BASED ON THE FACTS AS STATED IN ITS ASSAILED
RESOLUTION DATED JANUARY 6, 1999 (Annex "B" hereof) DISQUALIFYING
PRIVATE RESPONDENT FARIÑAS AS A CANDIDATE FOR CONGRESSMAN OF
THE FIRST LEGISLATIVE DISTRICT OF ILOCOS NORTE DURING THE MAY
11, 1998 ELECTIONS, PREMISED ON ITS FINDINGS THAT "THERE IS NONE
IN THE RECORDS TO CONSIDER RESPONDENT (FARIÑAS) AN OFFICIAL
CANDIDATE TO SPEAK OF WITHOUT THE FILING OF SAID CERTIFICATE,
HENCE, THERE IS NO CERTIFICATE OF CANDIDACY TO BE CANCELLED,
CONSEQUENTLY, NO CANDIDATE TO BE DISQUALIFIED." chanrob1es
virtua1 1aw 1ibrary
D. THE RESPONDENT COMELEC GRAVELY ABUSED ITS DISCRETION AND
ACTED IN EXCESS AND/OR WITHOUT JURISDICTION IN NOT CALLING A
SPECIAL ELECTION TO FILL-UP THE VACANT POSITION OF CONGRESSMAN
OF THE FIRST LEGISLATIVE DISTRICT OF ILOCOS NORTE DUE TO THE
DISQUALIFICATION OF RESPONDENT FARIÑAS AS A CANDIDATE THERETO
AND WHO APPEARS TO HAVE OBTAINED THE HIGHEST NUMBER OF VOTES
CAST IN THE MAY 11, 1998 ELECTIONS.
We find pertinent for our resolution this issue:chanrob1es virtual 1aw
library
Did the COMELEC commit grave abuse of discretion in holding that the
determination of the validity of the certificate of candidacy of respondent
Fariñas is already within the exclusive jurisdiction of the Electoral Tribunal
of the House of Representatives?
In its assailed resolution, the COMELEC had noted that respondent Fariñas
had taken his oath and assumed office as a Member of the 11th Congress
and by express mandate of the Constitution, 8 it had lost jurisdiction over
the case.
Petitioner Guerrero argues that the refusal of the COMELEC to rule on the
validity or invalidity of the certificate of candidacy of Fariñas amounted to
grave abuse of discretion on its part. He claims that COMELEC failed in its
Constitutional duty to uphold and enforce all laws relative to elections. 9
He relies on Gallardo v. Judge Tabamo, Jr., 218 SCRA 253 (1993), which
reiterated the doctrine laid down in Zaldivar v. Estenzo, 23 SCRA 533
(1968), that the COMELEC has exclusive charge of the enforcement and
administration of all laws relative to the conduct of an electoral exercise.
A special civil action for certiorari may be availed of when the tribunal,
board, or officer exercising judicial or quasi-judicial functions has acted
without or in excess of jurisdiction and there is no appeal or any plain,
speedy, and adequate remedy in the ordinary course of law for the purpose
of annulling the proceeding. 10 It is the proper remedy to question any
final order, ruling and decision of the COMELEC rendered in the exercise of
its adjudicatory or quasi-judicial powers. 11 But for an action
for certiorari to prosper, there must be a showing that the COMELEC acted
with grave abuse of discretion. This means such capricious and whimsical
exercise of judgment as is equivalent to lack of jurisdiction or excess
thereof, as where the power is exercised in an arbitrary and despotic
manner by reason of passion or personal hostility, and it must be so patent
as to amount to an evasion of positive duty or a virtual refusal to perform
the duty enjoined by law. 12
In the present case, we find no grave abuse of discretion on the part of the
COMELEC when it held that its jurisdiction over Case No. SPA 98-277 had
ceased with the assumption of office of respondent Fariñas as
Representative for the first district of Ilocos Norte. While the COMELEC is
vested with the power to declare valid or invalid a certificate of candidacy,
its refusal to exercise that power following the proclamation and
assumption of the position by Fariñas is a recognition of the jurisdictional
boundaries separating the COMELEC and the Electoral Tribunal of the
House of Representatives (HRET). Under Article VI, Section 17 of the
Constitution, the HRET has sole and exclusive jurisdiction over all contests
relative to the election, returns, and qualifications of members of the
House of Representatives. Thus, once a winning candidate has been
proclaimed, taken his oath, and assumed office as a member of the House
of Representatives, COMELEC’s jurisdiction over election contests relating
to his election, returns, and qualifications ends, and the HRET’s own
jurisdiction begins. 13 Thus, the COMELEC’s decision to discontinue
exercising jurisdiction over the case is justifiable, in deference to the
HRET’s own jurisdiction and functions.chanrob1es virtua1 1aw 1ibrary
WHEREFORE, the petition is hereby DISMISSED for lack of merit. Costs
against petitioner.
SO ORDERED.chanrob1es virtua1 1aw 1ibrary

However, petitioner contends that the jurisdiction of the HRET as defined Davide, Jr., C.J., Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza,
under Article VI, Section 17 of the Constitution is limited only to the Panganiban, Purisima, Pardo, Buena, Gonzaga-Reyes, Ynares-Santiago and
qualifications prescribed under Article VI, Section 6 of the Constitution. 14 De Leon, Jr., JJ., concur.
Consequently, he claims that any issue which does not involve these
constitutional qualifications is beyond the realm of the HRET. The filing of a
certificate of candidacy being a statutory qualification under the Omnibus
Election Code is outside the pale of the HRET, according to him.

This contention lacks cogency and is far from persuasive. Article VI,
Section 17 of the Constitution cannot be circumscribed lexically. The word
"qualifications" cannot be read as qualified by the term "constitutional." Ubi
lex non distinguit noc nos distinguire debemos. Basic is the rule in
statutory construction that where the law does not distinguish, the courts
should not distinguish. 15 There should be no distinction in the application
of a law where none is indicated. For firstly, the drafters of the
fundamental law, in making no qualification in the use of a general word or
expression, must have intended no distinction at all. Secondly, the courts
could only distinguish where there are facts or circumstances showing that
the lawgiver intended a distinction or qualification. In such a case, the
courts would merely give effect to the lawgiver’s intent. 16

Petitioner further argues that the HRET assumes jurisdiction only if there is
a valid proclamation of the winning candidate. He contends that if a
candidate fails to satisfy the statutory requirements to qualify him as a
candidate, his subsequent proclamation is void ab initio. Where the
proclamation is null and void, there is no proclamation at all and the mere
assumption of office by the proclaimed candidate does not deprive the
COMELEC at all of its power to declare such nullity, according to petitioner.
But as we already held, in an electoral contest where the validity of the
proclamation of a winning candidate who has taken his oath of office and
assumed his post as Congressman is raised, that issue is best addressed to
the HRET. 17 The reason for this ruling is self-evident, for it avoids
duplicity of proceedings and a clash of jurisdiction between constitutional
bodies, with due regard to the people’s mandate.

Whether respondent Fariñas validly substituted Chevylle V. Fariñas and

whether respondent became a legitimate candidate, in our view, must
likewise be addressed to the sound judgment of the Electoral Tribunal.
Only thus can we demonstrate fealty to the Constitutional provision that
the Electoral Tribunal of each House of Congress shall be the "sole judge of
all contests relating to the election, returns, and qualifications of their
respective members." 18
G.R. No. 95832 August 10, 1992
MAYNARD R. PERALTA, petitioner,
vs.
CIVIL SERVICE COMMISSION, respondent.
Tranquilino F. Meris Law Office for petitioner.
PADILLA, J.:
Petitioner was appointed Trade-Specialist II on 25 September 1989 in the Department
of Trade and Industry (DTI). His appointment was classified as
"Reinstatement/Permanent". Before said appointment, he was working at the
Philippine Cotton Corporation, a government-owned and controlled corporation under
the Department of Agriculture.
On 8 December 1989, petitioner received his initial salary, covering the period from 25
September to 31 October 1989. Since he had no accumulated leave credits, DTI
deducted from his salary the amount corresponding to his absences during the
covered period, namely, 29 September 1989 and 20 October 1989, inclusive of
Saturdays and Sundays. More specifically, the dates of said absences for which salary
deductions were made, are as follows:
1. 29 September 1989 — Friday
2. 30 September 1989 — Saturday
3. 01 October 1989 — Sunday
4. 20 October 1989 — Friday
5. 21 October 1989 — Saturday
6. 22 October 1989 — Sunday
Petitioner sent a memorandum to Amando T. Alvis (Chief, General Administrative
Service) on 15 December 1989 inquiring as to the law on salary deductions, if the
employee has no leave credits.
Amando T. Alvis answered petitioner's query in a memorandum dated 30 January
1990 citing Chapter 5.49 of the Handbook of Information on the Philippine Civil
Service which states that "when an employee is on leave without pay on a day before
or on a day immediately preceding a Saturday, Sunday or Holiday, such Saturday,
Sunday, or Holiday shall also be without pay (CSC, 2nd Ind., February 12, 1965)."
Petitioner then sent a latter dated 20 February 1990 addressed to Civil Service
Commission (CSC) Chairman Patricia A. Sto. Tomas raising the following question:
Is an employee who was on leave of absence without pay on a
day before or on a day time immediately preceding a Saturday,
Sunday or Holiday, also considered on leave of absence without
pay on such Saturday, Sunday or Holiday?1
Petitioner in his said letter to the CSC Chairman argued that a reading of the General
Leave Law as contained in the Revised Administrative Code, as well as the old Civil
Service Law (Republic Act No. 2260), the Civil Service Decree (Presidential Decree
No. 807), and the Civil Service Rules and Regulation fails to disclose a specific
provision which supports the CSC rule at issue. That being the case, the petitioner
contented that he cannot be deprived of his pay or salary corresponding to the
intervening Saturdays, Sundays or Holidays (in the factual situation posed), and that
the withholding (or deduction) of the same is tantamount to a deprivation of property
without due process of law.
On 25 May 1990, respondent Commission promulgated Resolution No. 90-497, ruling
that the action of the DTI in deducting from the salary of petitioner, a part thereof
corresponding to six (6) days (September 29, 30, October 1, 20, 21, 22, 1989) is in
order. 2 The CSC stated that:
In a 2nd Indorsement dated February 12, 1965 of this
Commission, which embodies the policy on leave of absence
without pay incurred on a Friday and Monday, reads:
Mrs. Rosalinda Gonzales is not entitled to
payment of salary corresponding to January
23 and 24, 1965, Saturday and Sunday,
respectively, it appearing that she was
present on Friday, January 22, 1965 but was
on leave without pay beginning January 25,
the succeeding Monday. It is the view of this
Office that an employee who has no more
leave credit in his favor is not entitled to the
payment of salary on Saturdays, Sundays or
holidays unless such non-working days occur
within the period of service actually rendered.
(Emphasis supplied)
The rationale for the above ruling which applies only to those
employees who are being paid on monthly basis, rests on the
assumption that having been absent on either Monday or Friday,
one who has no leave credits, could not be favorably credited with
intervening days had the same been working days. Hence, the
above policy that for an employee on leave without pay to be
 entitled to salary on Saturdays, Sundays or holidays, the same
must occur between the dates where the said employee actually
renders service. To rule otherwise would allow an employee who
is on leave of absent (sic) without pay for a long period of time to
be entitled to payment of his salary corresponding to Saturdays,
Sundays or holidays. It also discourages the employees who have
exhausted their leave credits from absenting themselves on a
Friday or Monday in order to have a prolonged weekend, resulting
in the prejudice of the government and the public in general. 3
Petitioner filed a motion for reconsideration and in Resolution No. 90-797, the
respondent Commission denied said motion for lack of merit. The respondent
Commission in explaining its action held:
The Primer on the Civil Service dated February 21, 1978,
embodies the Civil Service Commission rulings to be observed
whenever an employee of the government who has no more
leave credits, is absent on a Friday and/or a Monday is enough
basis for the deduction of his salaries corresponding to the
intervening Saturdays and Sundays. What the Commission
perceived to be without basis is the demand of Peralta for the
payment of his salaries corresponding to Saturdays and Sundays
when he was in fact on leave of absence without pay on a
Friday prior to the said days. A reading of Republic Act No. 2260
(sic) does not show that a government employee who is on leave
of absence without pay on a day before or immediately preceding
Saturdays, Sunday or legal holiday is entitled to payment of his
salary for said days. Further, a reading of Senate Journal No. 67
dated May 4, 1960 of House Bill No. 41 (Republic Act No. 2625)
reveals that while the law excludes Saturdays, Sundays and
holidays in the computation of leave credits, it does not, however,
include a case where the leave of absence is without pay. Hence,
applying the principle of inclusio unius est exclusio alterius, the
claim of Peralta has no merit. Moreover, to take a different
posture would be in effect giving more premium to employees
who are frequently on leave of absence without pay, instead of
discouraging them from incurring further absence without
pay. 4
Petitioner's motion for reconsideration having been denied, petitioner filed the present
petition.
What is primarily questioned by the petitioner is the validity of the respondent
Commission's policy mandating salary deductions corresponding to the intervening
Saturdays, Sundays or Holidays where an employee without leave credits was absent
on the immediately preceding working day.
During the pendency of this petition, the respondent Commission promulgated
Resolution No. 91-540 dated 23 April 1991 amending the questioned policy,
considering that employees paid on a monthly basis are not required to work on
Saturdays, Sunday or Holidays. In said amendatory Resolution, the respondent
Commission resolved "to adopt the policy that when an employee, regardless of
whether he has leave credits or not, is absent without pay on day immediately
preceding or succeeding Saturday, Sunday or holiday, he shall not be considered
absent on those days." Memorandum Circular No. 16 Series of 1991 dated 26 April
1991, was also issued by CSC Chairman Sto. Tomas adopting and promulgating the
new policy and directing the Heads of Departments, Bureaus and Agencies in the
national and local governments, including government-owned or controlled
corporations with original charters, to oversee the strict implementation of the circular.
Because of these developments, it would seem at first blush that this petition has
become moot and academic since the very CSC policy being questioned has already
been amended and, in effect, Resolutions No. 90-497 and 90-797, subject of this
petition for certiorari, have already been set aside and superseded. But the issue of
whether or not the policy that had been adopted and in force since 1965 is valid or not,
remains unresolved. Thus, for reasons of public interest and public policy, it is the duty
of the Court to make a formal ruling on the validity or invalidity of such questioned
policy.
The Civil Service Act of 1959 (R.A. No. 2260) conferred upon the Commissioner of
Civil Service the following powers and duties:
Sec. 16 (e) with the approval by the President to prescribe,
amend and enforce suitable rules and regulations for carrying into
effect the provisions of this Civil Service Law, and the rules
prescribed pursuant to the provisions of this law shall become
effective thirty days after publication in the Official Gazette;
xxx xxx xxx
(k) To perform other functions that properly belong to a central
personnel agency. 5
Pursuant to the foregoing provisions, the Commission promulgated the herein
challenged policy. Said policy was embodied in a 2nd Indorsement dated 12 February
1965 of the respondent Commission involving the case of a Mrs. Rosalinda Gonzales.
The respondent Commission ruled that an employee who has no leave credits in his
favor is not entitled to the payment of salary on Saturdays, Sundays or Holidays
unless such non-working days occur within the period of service actually rendered.
The same policy is reiterated in the Handbook of Information on the Philippine Civil
Service. 6 Chapter Five on leave of absence provides that:
5.51. When intervening Saturday, Sunday or holiday considered
as leave without pay — when an employee is on leave without
 pay on a day before or on a day immediately preceding a
Saturday, Sunday or holiday, such Saturday, Sunday or holiday
shall also be without pay. (CSC, 2nd Ind., Feb. 12, 1965).
It is likewise illustrated in the Primer on the Civil Service 7 in the section referring to
Questions and Answers on Leave of Absences, which states the following:
27. How is leave of an employee who has no more leave credits
computed if:
(1) he is absent on a Friday and the following Monday?
(2) if he is absent on Friday but reports to work the following Monday?
(3) if he is absent on a Monday but present the preceding Friday?
- (1) He is considered on leave without pay for 4 days covering Friday to Monday;
- (2) He is considered on leave without pay for 3 days from Friday to Sunday;
- (3) He is considered on leave without pay for 3 days from Saturday to Monday.
When an administrative or executive agency renders an opinion or issues a statement
of policy, it merely interprets a pre-existing law; and the administrative interpretation of
the law is at best advisory, for it is the courts that finally determine what the law
means. 8 It has also been held that interpretative regulations need not be published. 9
In promulgating as early as 12 February 1965 the questioned policy, the Civil Service
Commission interpreted the provisions of Republic Act No. 2625 (which took effect on
17 June 1960) amending the Revised Administrative Code, and which stated as
follows:
Sec. 1. Sections two hundred eighty-four and two hundred eighty-
five-A of the Administrative Code, as amended, are further
amended to read as follows:
Sec. 284. After at least six months' continues (sic) faithful, and satisfactory service,
the President or proper head of department, or the chief of office in the case of
municipal employees may, in his discretion, grant to an employee or laborer, whether
permanent or temporary, of the national government, the provincial government, the
government of a chartered city, of a municipality, of a municipal district or of
government-owned or controlled corporations other than those mentioned in Section
two hundred sixty-eight, two hundred seventy-one and two hundred seventy-four
hereof, fifteen days vacation leave of absence with full pay, exclusive of Saturdays,
Sundays and holidays, for each calendar year of service.
Sec. 285-A. In addition to the vacation leave provided in the two preceding sections
each employee or laborer, whether permanent or temporary, of the national
government, the provincial government, the government of a chartered city, of a
municipality or municipal district in any regularly and specially organized province,
other than those mentioned in Section two hundred sixty-eight, two hundred seventy-
one and two hundred seventy-four hereof, shall be entitled to fifteen days of sick leave
for each year of service with full pay, exclusive of Saturdays, Sundays and
holidays: Provided, That such sick leave will be granted by the President, Head of
Department or independent office concerned, or the chief of office in case of municipal
employees, only on account of sickness on the part of the employee or laborer
concerned or of any member of his immediate family.
The Civil Service Commission in its here questioned Resolution No. 90-797 construed
R.A. 2625 as referring only to government employees who have earned leave credits
against which their absences may be charged with pay, as its letters speak only
of leaves of absence with full pay. The respondent Commission ruled that a reading of
R.A. 2625 does not show that a government employee who is on leave of
absence without pay on a day before or immediately preceding a Saturday, Sunday or
legal holiday is entitled to payment of his salary for said days.
Administrative construction, if we may repeat, is not necessarily binding upon the
courts. Action of an administrative agency may be disturbed or set aside by the judicial
department if there is an error of law, or abuse of power or lack of jurisdiction or grave
abuse of discretion clearly conflicting with either the letter or the spirit of a legislative
enactment. 10
We find this petition to be impressed with merit.
As held in Hidalgo vs. Hidalgo: 11
. . . . where the true intent of the law is clear that calls for the
application of the cardinal rule of statutory construction that such
intent or spirit must prevail over the letter thereof, for whatever is
within the spirit of a statute is within the statute, since adherence
to the letter would result in absurdity, injustice and contradictions
and would defeat the plain and vital purpose of the statute.
The intention of the legislature in the enactment of R.A. 2625 may be gleaned from,
among others, the sponsorship speech of Senator Arturo M. Tolentino during the
second reading of House Bill No. 41 (which became R.A. 2625). He said:
The law actually provides for sick leave and vacation leave of 15
days each year of service to be with full pay. But under the
 present law, in computing these periods of leaves, Saturday,
Sunday and holidays are included in the computation so that if an
employee should become sick and absent himself on a Friday
and then he reports for work on a Tuesday, in the computation of
the leave the Saturday and Sunday will be included, so that he
will be considered as having had a leave of Friday, Saturday,
Sunday and Monday, or four days.
The purpose of the present bill is to exclude from the computation
of the leave those days, Saturdays and Sundays, as well as
holidays, because actually the employee is entitled not to go to
office during those days. And it is unfair and unjust to him that
those days should be counted in the computation of leaves. 12
With this in mind, the construction by the respondent Commission of R.A. 2625 is not
in accordance with the legislative intent. R.A. 2625 specifically provides that
government employees are entitled to fifteen (15) days vacation leave of absence with
full pay and fifteen (15) days sick leave with full pay, exclusive of Saturdays, Sundays
and Holidays in both cases. Thus, the law speaks of the granting of a right and the law
does not provide for a distinction between those who have accumulated leave credits
and those who have exhausted their leave credits in order to enjoy such right. Ubi lex
non distinguit nec nos distinguere debemus. The fact remains that government
employees, whether or not they have accumulated leave credits, are not required by
law to work on Saturdays, Sundays and Holidays and thus they can not be declared
absent on such non-working days. They cannot be or are not considered absent on
non-working days; they cannot and should not be deprived of their salary
corresponding to said non-working days just because they were absent without pay on
the day immediately prior to, or after said non-working days. A different rule would
constitute a deprivation of property without due process.
Furthermore, before their amendment by R.A. 2625, Sections 284 and 285-A of the
Revised Administrative Code applied to all government employee without any
distinction. It follows that the effect of the amendment similarly applies to all
employees enumerated in Sections 284 and 285-A, whether or not they have
accumulated leave credits.
But, as held in Chicot County Drainage District vs. Baxter State
Bank:14
. . . . It is quite clear, however, that such broad statements as to
the effect of a determination of unconstitutionality must be taken
with qualifications. The actual existence of a statute, prior to such
determination is an operative fact and may have consequences
which cannot always be ignored. The past cannot always be
erased by a new judicial declaration. The effect of the subsequent
ruling as to invalidity may have to be considered in various
aspects — with respect to particular relations, individual and
corporate; and particular conduct, private and official.
To allow all the affected government employees, similarly situated as petitioner herein,
to claim their deducted salaries resulting from the past enforcement of the herein
invalidated CSC policy, would cause quite a heavy financial burden on the national
and local governments considering the length of time that such policy has been
effective. Also, administrative and practical considerations must be taken into account
if this ruling will have a strict restrospective application. The Court, in this connection,
calls upon the respondent Commission and the Congress of the Philippines, if
necessary, to handle this problem with justice and equity to all affected government
employees.
It must be pointed out, however, that after CSC Memorandum Circular No. 16 Series
of 1991 — amending the herein invalidated policy — was promulgated on 26 April
1991, deductions from salaries made after said date in contravention of the new CSC
policy must be restored to the government employees concerned.
WHEREFORE, the petition is GRANTED, CSC Resolutions No. 90-497 and 90-797
are declared NULL and VOID. The respondent Commission is directed to take the
appropriate action so that petitioner shall be paid the amounts previously but
unlawfully deducted from his monthly salary as above indicated. No costs.
SO ORDERED.

As the questioned CSC policy is here declared invalid, we are next confronted with the Narvasa, C.J., Gutierrez, Jr., Cruz, Feliciano, Bidin, Griño-Aquino, Medialdea,
question of what effect such invalidity will have. Will all government employees on a Regalado, Davide, Jr., Romero, Nocon and Bellosillo, JJ., concur.
monthly salary basis, deprived of their salaries corresponding to Saturdays, Sundays
or legal holidays (as herein petitioner was so deprived) since 12 February 1965, be
entitled to recover the amounts corresponding to such non-working days?

The general rule vis-a-vis legislation is that an unconstitutional act is not a law; it
confers no rights; it imposes no duties; it affords no protection; it creates no office; it is
in legal contemplation as inoperative as though it had never been passed. 13