CHAPTER V

GENERAL PRINCIPLES IN THE

CONSTRUCTION OF STATUTES

I. STATUTES MUST BE READ AND CONSTRUED

AS A WHOLE
It is basic that a statute must be read and construed in its en-
tirety. Hence, each provision of the statute should be construed in
relation to the other provisions of the statute.
Parts of a statute are not to be viewed in isolation because a
statute is passed and approved as a whole, and more than this, there
is a precise purpose why it was enacted. It is this purpose of the stat-
ute as a whole that is subject of ascertainment.
In trying to ascertain legislative intent, courts should first be
guided by intrinsic aids, or those found in the law itself. There is
no need to make use of extrinsic aids, or those found outside of the
written language of the law, if the legislative intent could be ascer-
tained by merely making use of intrinsic aids. (Casela v. CA, G.R.
No. L-26754, October 16, 1970)
These intrinsic aids are the title, preamble, the words, phrases
and sentences, context, punctuations, headings and marginal notes,
legislative definition, and interpretation clauses. All these must be
read and construed as a whole, instead of viewing them in isolation.

II. LEGISLATIVE INTENT MUST BE ASCERTAINED

FROM THE STATUTE AS A WHOLE
OPTIMA STATULI INTERPRETATIX EST IPSUM
STATUTUM. The best interpreter of the statute is the statute
itself. Hence, in the construction of statutes, what is of prevailing
importance is to discover the legislative intent why the law is
enacted. This intent is primarily determined from the language of
the statute.

148
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GENERAL PRINCIPLES IN THE CONSTRUCTION OF STATUTES

The court's honest belief that the legislature intended to enact

a law different to what it actually enacted is of no moment. Neither
can the courts determine whether the statute is wise for that is not
its duty. Its duty is to find out the legislative intent, and this can be
done by construing the statute as a whole, by considering one part
of the statute in relation to the other parts, and by harmonizing all
the provisions of the statute whenever possible.
It is to be presumed that the purpose of the legislature is to
make every part of the statute effective.
The basis of this rule is the Latin Maxim - UT R.ES MAGIS
QUAM PEREAT. This means that it is not enough that a statute
should be given effect as a whole but that effect should be given to
each of the provisions in the statute.
This rule applies to amendments because it is presumed that
the legislature, in making changes in the law, finds that there is a
necessity for said amendments. This is a legislative function which
is beyond the domain of the courts.
The cases below illustrate the principles herein discussed.

New Case:
LORENZO T. TANGGA-AN v.
PHILIPPINE TRANSMARINE CARRIERS, INC., et al.,
G.R. No. 180636, March 13, 2013
FACTS:
This is a case for illegal dismissal with a claim for the payment
of salaries corresponding to the unexpired term of the contract,
damages and attorney's fees filed by Lorenzo Tangga-an against the
Philippine Transmarine Carriers, Inc., Universe Tankship Delaware
LLC, and Carlos C. Salinas.
It was alleged that Tangga-an entered into an overseas employ-
ment contract with Philippine Transmarine Carriers, Inc. (PTC) for
and in behalf of its foreign employer, Universe Tankship Delaware,
LLC. Under the contract, he was to be employed for a period of six
months as chief engineer of the vessel S.S. "Kure" with US$5,000 as
basic salary, vacation leave pay of US$2,500 per month, and US$700
tonnage bonus a month.
On February 11, 2002, he was deployed. On or about Mar. 13,
2002, the vessel berthed at a port in Japan to discharge its cargo.
150 STATUTORY CONSTRUCTION

Thereafter, it sailed to the U.S.A. While the vessel was still at sea,
the master required him and the rest of the Filipino Engineer Offi-
cers to report to his office where they were informed that they would
be repatriated on account of the delay in the cargo discharging in
Japan.
Tangga-an filed a Complaint for illegal dismissal with prayer
for payment of salaries for the unexpired portion of his contract,
leave pay, exemplary and moral damages, attorney's fees and inter-
est.
The Labor Arbiter (LA) rendered a decision finding the peti-
tioner to have been illegally dismissed As regards to the claim for
back salaries, it ruled that he is not entitled to four months which
is equivalent to the unexpired portion of his contract, but only to
three months, inclusive of vacation leave pay, and tonnage bonus
pursuant to Section 10 of RA No. 8042 or The Migrant Workers and
Overseas Filipinos Act of 2005.
The NLRC affirmed the decision of the LA. Respondent's
motion for reconsideration was denied.
The CA modified the NLRC decision, as to monetary awards, it
considered only basic monthly salary and disregarded the monthly
vacation leave pay and tonnage bonus and likewise held that the
"unexpired portion of contract" for which he is entitled to back
salaries should only be three months pursuant to Section 1017 of
RA No. 8042.
Petitioner filed a Motion for (Partial) Reconsideration, but was
denied. Thus, he filed the instant Petition.

ISSUE:
Whether the indemnity awarded by the CA in petitioner's favor
consisting only of three months basic salaries conforms with the
proper interpretation of Section 10 of RA No 8042

RULING:
The Supreme Court held that in resolving petitioner's
monetary claims, the CA utterly misinterpreted the Court's ruling
in Skippers Pacific, Inc v Skippers Maritime Services, Ltd., using it
to support a view which the latter case precisely ventured to strike
down. In that case, the employee was hired as the vessel's Master
on a six-month employment contract, but was able to work for
only two months, as he was later on illegally dismissed. The Labor
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GENERAL PRINCIPLES IN THE CONSTRUCTION OF STATUTES

Arbiter, NLRC, and the CA all took the view that the complaining
employee was entitled to his salary for the unexpired portion of his
contract, but limited to only three months pursuant to Section 1024
of RA No. 8042. The Court did not agree and hence modified the
judgment in said case. It held that, following the wording of Sec. 10
and its ruling in Marsaman Manning Agency, Inc. v. National Labor
Relations Commission, when the illegally dismissed employee's
employment contract has a term of less than one year, he shall be
entitled to recovery of salaries representing the unexpired portion of
his employment contract. Indeed, there was nothing even vaguely
confusing in the Court's citation therein of Marsaman
In Marsaman Manning Agency, Inc. v. NLRC, involving Section
10 of RA No. 8042, it was held:
"[The Court] cannot subscribe to the view that private re-
spondent is entitled to three (3) months salary only. A plain
reading of Section 10 clearly reveals that the choice of which
amount to award an illegally dismissed overseas contract
worker, i.e., whether his salaries for the unexpired portion of
his employment contract or three (3) months salary for every
year of the unexpired term, whichever is less, comes into play
only when the employment contract concerned has a term of
at least one (1) year or more. This is evident from the [word-
ing] "for every year of the unexpired term" which follows the
[wording] "salaries x x x for three months." To follow petition-
ers' thinking that private respondent is entitled to three (3)
months salary only simply because it is the lesser amount is
to completely disregard and overlook some words used in the
statute while giving effect to some. This is contrary to the well-
established rule in legal hermeneutics that in interpreting
a statute, care should be taken that every part or word
thereof be given effect since the law making body is pre-
sumed to know the meaning of the words employed in
the statute and to have used them advisedly. Ut res ma-
gis valeat quam pereat." (Emphasis supplied)
It is not disputed that private respondent's employment
contract in the instant case was for six (6) months Hence, no
reason to disregard the ruling in Marsaman that private re-
spondent should be paid his salaries for the unexpired portion
of his employment contract.
Thus, petitioner must be awarded his salaries corresponding
to the unexpired portion of his six-month employment contract,
152 STATUTORY CONSTRUCTION

or equivalent to four months. This includes all his corresponding

monthly vacation leave pay and tonnage bonuses which are expressly
provided and guaranteed in his employment contract as part of his
monthly salary and benefit package. These benefits were guaranteed
to be paid on a monthly basis, and were not made contingent.

Old Case:

MERIDIAN ASSURANCE CORPORATION v. DAYRIT

G.R. No. 1-59154, April 3, 1990
FACTS:
In a suit by the First Western Bank and Trust Company
against Atlas Timber Company, et al., the trial judge rendered
judgment ordering Meridian Assurance Corporation to pay First
Western the sum of $21,933.38 or its equivalent in pesos at the rate
of P3.9390 to a dollar, with interest at the legal rate from the filing
of the complaint.
Thereafter, Meridian wrote First Western offering to pay
the amount of the judgment with 6% interest per annum and
the approved costs of P237. First Western rejected the offer, its
view being that the rate of interest should be 12 % per annum in
accordance with Central Bank Circular No. 416.
Meridian then filed with the trial court a motion manifesting
its deposit with the court of the amount of P170,061.03 representing
the principal indebtedness, the 6% interest on the principal debt
at 6% per annum, and costs of the suit, praying that the deposit be
allowed, that it be considered full satisfaction of the judgment, and
that enforcement of the writ of execution be restrained. The trial
court denied the motion stating that Central Bank Circular No. 416
had changed the legal rate of interest from 6% to 12% per annum.

ISSUE:
The sole issue concerns the rate of interest properly imposable
in relation to a judgment for payment of money: 6%, as provided
by Article 2209 of the Civil Code; or 12% conformably with Central
Bank Circular No. 416.

HELD:
1. The issue has already been passed upon and resolved by the
Court in two earlier cases. In one case, the Court held that
 CHAPTER V 153
GENERAL PRINCIPLES IN THE CONSTRUCTION OF STATUTES

the "judgments spoken of and referred to are (only) judgments

in litigation involving loans or forbearance of any money,
goods or credits." It declared that any other kind of monetary
judgment which has nothing to do with, nor involving loans or
forbearance of any money, goods or credits does not fall within
the coverage of the said law (PD No. 116) for it is not within
the ambit of the authority granted to the Central Bank. The
Monetary Bank may not tread on forbidden grounds. It cannot
rewrite other laws. That function is vested solely with the
legislative authority.
2. Section 1-a of Act No. 2655, as amended, which, as
distinguished from Section 1 of the same law, appears to be the
actual and operative grant of authority to the Monetary Board
of the Central Bank to prescribe maximum rates of interest
where the parties have not stipulated thereon, in excluding
mention of rates allowed in judgments, should, at the least be
considered as limiting the authority thus granted only to loans
or forbearances of money, etc., and to judgments involving such
loans or forbearances.

III. COURTS HAVE THE DUTY TO RECONCILE OR

HARMONIZE THE DIFFERENT PROVISIONS OF
THE STATUTE INCLUDING THE CONFLICTING
PROVISIONS THEREOF
Each provision in a statute is inserted for a definite reason.
The one who drafted the law may have a good reason for inserting
provision, which the reader may not see or appreciate. The courts
therefore have the duty to reconcile or harmonize so far as practi-
cable the various parts and provisions of a statute, including the
conflicting provisions thereof, so as to make them consistent, har-
monious and sensible. It is only through this that the statute will be
given effect as a whole.

IV. AS A RULE, THE STATUTE OF LATER DATE

PREVAILS
Where two statutes of different dates and of contrary tenor are
of equal theoretical application to a particular case, the statute of
later date prevails.
The statute of a later date is presumed to be the latest
expression of legislative will on the subject. Hence, Section 44(c) of
the Judiciary Act of 1948 should give way to the provisions of the
154 STATUTORY CONSTRUCTION

Tariff Customs Code and to HA No. 1937, which took effect on July
1, 1957, much later than the Judiciary Act of 1948. Besides, it is
more reasonable to conclude that the legislators intended to divest
the Court of First Instance of the prerogative to replevin a property
that is subject of seizure and forfeiture proceedings for violation of
the Tariff and Customs Code. (Pacis v. Averia, G.R. No. L-22526,
November 29, 1966)

V. GENERALIA SPECIALIBUS NON DEROGANT

Special provisions prevail over the general provisions. (Black
in Interpretation of Laws, 2nd edition, pp. 328-329) However, if it is
possible to harmonize the general and special provisions, said rule
shall not apply.
Special provisions prevail regardless of the position it occupies
in the statute, and whether it comes earlier or later than the general
one.

VI. A SPECIAL LAW PREVAILS OVER

A GENERAL LAW
In Fiestan v. Court of Appeals, G.R. No. 81552, May 28,
1990, the mortgagor sought the nullity of the extrajudicial foreclo-
sure sale on the ground that the mortgagee (DBP) cannot acquire
by purchase the mortgaged property at the public auction sale by
virtue of paragraph 2 Article 1491 and paragraph 7 of Article 1409
of the Civil Code which prohibits agents from acquiring by purchase,
even at a public or judicial auction, either in person or through the
mediation of another, the property whose administration or sale
may have been entrusted to them, unless the consent of the princi-
pal has been given.
The Supreme Court ruled that the prohibition mandated by
paragraph 2 of Article 1491 in relation to Article 1409 of the Civil
Code does not apply where the sale of the property was made under
a special power inserted in or attached to the real estate mortgage
pursuant to Act No 3135, as amended
As between a specific statute and a general statute, the former
must prevail since it evinces the legislative intent more clearly than
a general statute does. The Civil Code (RA No. 386) is of general
character, while Act No. 3135, as amended, is a special enactment
and therefore the latter must prevail.
 CHAPTER V 155
GENERAL PRINCIPLES IN THE CONSTRUCTION OF STATUTES

UnderAct No. 3135, as amended, a mortgagee creditor is allowed

to take part in the bidding and purchase under the same conditions
as any other bidder. Section 5 of Act No. 3135, as amended, creates
and is designed to create an exception to the general rule that a
mortgagee or trustee in a mortgage or deed of trust which contains
a power of sale on default may not become the purchaser, either
directly or through the agency of a third person, at a sale which he
himself makes under the power. Under such exception, the title of
the mortgagee creditor over the property cannot be impeached or
defeated on the ground that the mortgagee cannot be a purchaser
at his own sale.

EXCEPTIONS TO THIS RULE

The said rule is subject to the following exceptions:
(1) The general law prevails over the special law when it
treats the subject in particular and the special law refers
to it in general; (Bagatsing v. Ramirez, G.R. No. 41631,
December 17, 1976)
(2) The general law prevails over the special law when the
legislature intended the general enactment to cover the
whole subject and to repeal all prior laws inconsistent
therewith. (Lechoco v. Civil Aeronautics Board, 43 SCRA
670)

VII. PARI MATERIA RULE

Under this rule, all statutes relating to the same subject, or
having the same general purpose, should be read and construed
together as if they constituted one law. (C.J.S. pp. 803-806) They
shall then be construed and harmonized with the existing law.
This rule is founded on the assumption that in enacting a law,
the legislature has in mind the previous statutes relating to the
same subject matter, and in the absence of any express repeal or
amendment the new statute is deemed enacted in accordance with
the legislative policy embodied in the previous statutes that it en-
acted.
This rule is subject to two qualifications:
If two or more statutes on the same subject were enacted
at different times and under different conditions and cir-
156 STATUTORY CONSTRUCTION

cumstances, THEIR INTERPRETATION SHOULD BE

IN ACCORDANCE WITH THE CIRCUMSTANCES OR
CONDITIONS PECULIAR TO EACH. (This rule is based
on the Latin Maxim DISTINGUE TEMPRA ET CON-
CORDABIS JURA)
2. A statute will not be construed as repealing prior act or
acts on the same subject unless the new law is evidently
intended to all prior laws on the matter.
In case of doubt, the doubt will be resolved against implied
amendment or repeal and in favor of harmonization of all laws on
the subject.

VIII. IN INTERPRETING REENACTED STATUTES,

THE COURT WILL FOLLOW THE
CONSTRUCTION WHICH SUCH STATUTE
RECEIVED WHEN PREVIOUSLY IN FORCE
A reenacted statute is a statute, which reenacts a previous
statute. In reenacting the provisions of a previous statute, it is
presumed that the legislature has the intention of adopting the
construction and the language of the previous act. Hence, when a
provision in the City Charter of Manila regarding prosecution of
crimes by the City Fiscal was incorporated in the charter of the
City of Bacolod, it was ruled that the framers of the charter of the
City of Bacolod has reproduced the provision of the City Charter of
Manila with the intention of adopting also its settled interpretation.
Accordingly, the Supreme Court ruled that Section 3 of the City
Charter of Manila to the effect that ("the prosecuting attorney of
the City of Manila shall have charge of the prosecution of all crimes,
misdemeanors and violations of city ordinances, in the Court of
First Instance and municipal courts of the City of Manila. He shall
investigate all charges of crimes, misdemeanors and violations of
ordinances and prepare the necessary information or make the
necessary complaints against the persons accused, and discharge
all other duties in respect to criminal prosecutions enjoined
upon provincial fiscals"), means that criminal complaints filed by
offended parties directly with the courts without the intervention
of the City Fiscal of Manila cannot legally be done. This is the same
interpretation that was applied with respect to a criminal complaint
filed by an offended party directly in the City Court of Bacolod City.
(Montelibano v. Ferrer, 97 Phil. 228)
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GENERAL PRINCIPLES IN THE CONSTRUCTION OF STATUTES

IX. IN THE CASE OF ADOPTED STATUTE,

THE INTERPRETATION OF THE COURTS
OF THE STATE FROM WHICH IT IS ADOPTED
SHOULD BE CONSIDERED
Adopted statutes are those which are patterned after, or copied
from the statute of another country. For purposes of construing
an adopted statute, our courts will necessarily be guided by the
interpretation and construction of the courts of the country from
which such statute is taken.
The due process clause and the equal protection clause, which
are still found in our Constitution, are of American origin. It is not
strange that in numerous cases, our courts were guided by Amer-
ican doctrines and principles, which are applicable, and by inter-
pretations that were made in classic decisions of the United States
Supreme Court.
The case of Rubi v. Provincial Board of Mindoro (39 Phil. 660),
is an example. In this case, the Supreme Court made reference to
decisions of the United States Supreme Court when it pronounced
that the guarantee in the fourteenth amendment of the United
States Constitution protects liberty. The pertinent portion of the
decision is as follows:

"Civil liberty may be said to mean that measure of

freedom which may be enjoyed in a civilized community,
consistently with the peaceful enjoyment of like freedom in
others. The right to liberty guaranteed by the Constitution
includes that right to exist and the right to be free from
arbitrary personal restraint or servitude. The term cannot
be drawned into mere freedom from physical restraint of
the person of the citizen, but is deemed to embrace the
right of man to enjoy the faculties to which he has been
endowed by his Creator, subject only to such restraints as
are necessary for the common welfare. As enunciated in a
long array of authorities including epoch-making decisions
of the United States Supreme Court, liberty includes the
right of the citizen to be free to use his faculties in all
lawful ways; to live and work where he will; to earn his
livelihood by any lawful calling; to pursue any vocation,
and for that purpose, to enter into all contracts which
may be proper, necessary, and essential to his carrying
out these purposes to a successful conclusion. The chief
158 STATUTORY CONSTRUCTION

elements of the guaranty are the right to contract, the

right to choose one's employment, the right to labor, and
the right to locomotion."

Our law on corporation and insolvency is of American origin.

Hence, American decisions may, if applicable, be cited in cases
brought to our courts for decision.

X. IN CASE OF CONFLICT BETWEEN A

COMMON LAW PRINCIPLE AND A STATUTORY
PROVISION, THE LATTER PREVAILS
In Alvendia v. Intermediate Court, G.R. No. L-72138 and
Bonamy v. Justice Paras, G.R. No. 72138, January 20, 1990, the
Supreme Court ruled that equity applies only in the absence of
and never against statutory law or judicial rules of procedure. The
Supreme Court denied the plea of Alvendia that equity be applied in
his favor and ruled that:
"The Alvendias cannot invoke equity as a ground
for reopening the case and making the payment of
the judgment in cash possible, where they had all the
opportunity to make such payments on four occasions but
failed. These are: (1) from the time they got the building
and construction materials worth P107,461.50 from the
petitioner (from June 26 to August 12, 1975) up to the
time they agreed to a compromise agreement on January
6, 1978; (2) from the compromise judgment to the time
execution was ordered by the respondent court (Order
dated December 6, 1979); (3) from the Execution Order
to the Execution Sale (on January 15, 1981); and (4) from
the execution sale up to the end of the redemption period,
finally ending in the final deed of sale. There may be a
moral obligation but if there is no enforceable legal duty,
the action for reconveyance must fail."

On the point that statutory law prevails as against equity, the

Supreme Court said:

"Equity is justice outside legality. It applies only in

the absence of and never against statutory law or judicial
rules of procedure. "Equity follows the law" but where
the law gives a particular remedy and that remedy is
bounded and circumscribed by particular rules, it would
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GENERAL PRINCIPLES IN THE CONSTRUCTION OF STATUTES

be improper for the court to take it up where the law

leaves it and to extend it further than the law allows.
Courts exercising equity jurisdiction are bound by rules
of law and have no arbitrary discretion to disregard them.
Equitable reasons will not control against any well-settled
rule of law or public policy."

In Andres v. Manufacturers Hanover & Trust Corporation

(G.R. No. L-82670, September 15, 1989), the Supreme Court laid
down this ruling: "Principles of equity cannot be applied if there
is a provision of law specifically applicable to a case. The common
law principle that were one of two innocent persons must suffer by
a fraud perpetrated by another, the law imposes the loss upon the
party who, by his misplaced confidence, has enabled the fraud to
be committed, cannot be applied in a case which is covered by an
express provision of the New Civil Code, specifically Article 559
Between a common law principle and a statutory provision, the
latter must prevail in this jurisdiction"

XI. IMPLIED REPEALS ARE NOT LEGALLY PRESUMED

IN THE ABSENCE OF A CLEAR AND UNMISTAKABLE
SHOWING OF SUCH INTENTIONS

BATANGAS CATV, INC v THE COURT OF

APPEALS, et at.,
G R No 138810, September 29, 2004
In the resolution of this case, the Supreme Court cited the
historical background regarding NTC's regulatory power over the
CATV industry.

FACTS:
On July 28, 1986, respondent Sangguniang Panlungsod enacted
Resolution No. 210 granting petitioner a permit to construct, install,
and operate a Community Antenna Television (CATV) system in
Batangas City, which provides that petitioner is authorized to charge
its subscribers the maximum rates specified therein, "provided,
however, that any increase of rates shall be subject to the approval
of the Sangguniang Panlungsod."
Sometime in November 1993, petitioner increased its subscrib-
er rates from P88.00 to P180.00 per month. As a result, respondent
Mayor wrote petitioner a letter threatening to cancel its permit un-
less it secures the approval of respondent Sanggumang Panlungsod.
160 STATUTORY CONSTRUCTION

Petitioner then filed with the RTC, Branch 7, Batangas City,

a petition for injunction. It alleged that respondent Sangguniang
Panlungsod has no authority to regulate the subscriber rates
charged by CATV operators because under Executive Order No. 205,
the National Telecommunications Commission (NTC) has the sole
authority to regulate the CATV operation in the Philippines.
After trial, the trial court enjoined the respondents from
canceling petitioner's permit to operate a Cable CATV system in the
City of Batangas.
Upon respondents' appeal, the Court of Appeals reversed and
set aside the trial court's decision; hence, this petition.

ISSUE:
Is Executive Order No. 205 impliedly repealed by RA No. 7160?

HELD:
At any rate, [the Court] find[s] no basis to conclude that RA
No. 7160 repealed Executive Order No. 205, either expressly or
impliedly. It is noteworthy that RA No. 7160 repealing clause, which
painstakingly mentions the specific laws or the parts thereof which
are repealed, does not include Executive Order No. 205.
Neither is there an indication that Executive Order No. 205
was impliedily repealed by RA No. 7160. It is a settled rule that
implied repeals are not lightly presumed in the absence of a clear
and unmistakable showing of such intentions.