1

G.R. No. L-30761 July 11, 1973 3 25,000.00 to 31,249.99 132.00 " "
4 20,000.00 to 24,999.99 105.00 " "
THE SAN MIGUEL CORPORATION, petitioner, 5 15.000.00 to 19,999.99 83.00 " "
vs. 6 12.500.00 to 14,999.99 63.00 " "
THE MUNICIPAL COUNCIL, THE MAYOR, and THE MUNICIPAL TREASURER OF THE 7 10,000.00 to 12,499.99 50.00 " "
MUNICIPALITY OF MANDAUE, PROVINCE OF CEBU, respondents. 8 8,750.00 to 9,999.99 42.00 " "
Gadioma and Josue for petitioner. 9 7,500.00 to 8,749.99 37.00 " "
10 6,500.00 to 7,499.99 31.00 " "
Acting City Fiscal Lawrence A. Parawan for respondents. 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 " "
ANTONIO, J.: 14 3,000.00 to 3,749.99 16.00 " "
15 2,500.00 to 2,999.99 13.00 " "
Petition for writ of certiorari to review the judgment of the Court of First Instance of Cebu, 16 2,000.00 to 2,499.99 11.00 " "
in Civil Case No. R-10631, upholding the validity of Ordinance No. 23, series of 1966, as 17 1,750.00 to 1,999.99 9.00 " "
amended by Ordinance No. 25, series of 1967, of the Municipality of Mandaue, Cebu, 18 1,500.00 to 1,749.99 8.00 " "
imposing "a graduated quarterly fixed tax based on the gross value of money or actual 19 1,250.00 to 1,499.99 7.00 " "
market value at the time of removal of the manufactured articles from their factories or 20 Less than P1,250.00 5.00 " "
other manufacture or processing establishments."
The pertinent portion of Section 2 of Ordinance No. 23 which was not amended by
In enacting the said ordinances, the municipal council of Mandaue invoked as basis of its Ordinance No. 25 states:
authority Republic Act No. 2264 (Local Autonomy Act).
Payment of Municipal License Tax. — A fixed tax imposed on this ordinance must first be
The relevant portion of Section 1, Ordinance No. 23 (1966), as amended by Ordinance No. paid before any person can engage in business and is payable for each taxable business; ...
25 (1967), provides as follows:
The graduated fixed tax provided in this ordinance shall be paid at the Office of the
SECTION 1. — Municipal License Tax On Proprietors Or Operators Of ... Breweries, ... Municipal Treasurer quarterly, on or before the twentieth of January, April, July and
Proprietors or operators of ... breweries, ... within the territorial limits of this municipality October; ... . Provided further, That as regards businesses already operating at the time
shall pay a graduated quarterly fixed tax based on the gross value in money or actual this ordinance takes effect, the tax for the initial quarter shall be paid pursuant to the
market value at the time of removal, of the manufactured articles from their factories ... provisions of this ordinance and shall be based on the gross value in money during the
during the preceding quarter in accordance with the following schedules: ...: quarter immediately preceding, ... .

CLASS QUARTERLY LICENSE TAX Within the time fixed for the payment of the license taxes herein imposed, the taxpayers
P160.00 and P0.30 for shall prepare and file with the Municipal Treasurer, a sworn statement of the gross value
QUARTERLY GROSS VALUE each P1,000.00 or in money during the preceding quarter on the basis of which the tax shall be assessed and
fraction thereof in excess collected. ... .

1 P37,500.00 or over of P37,500.00 gross value.

2 P31.250.00 to P37,499.99 P158.00 per quarter
 2

The basic Ordinance was No. 88,1 which took effect on September 25, 1962, but this was providing for a graduated tax based on either "gross output or sales" violates the
amended by Ordinance No. 23 (January 1, 1967), and by Ordinance No. 25 (January 1, prohibition on municipalities against imposing any percentage tax on sales, or other taxes
1968). 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
Petitioner, a domestic corporation engaged in the business of manufacturing beer and taxpayer is required to submit to the municipal treasurer.
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 We are thus confined to the narrow issue of whether or not the challenged ordinance has
January 22, 1968 and P5,171.80 as of July 18, 1968, computed respectively "on the basis transcended the exceptions and limitations imposed by section 2 of Republic Act 2264.
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 Section 2 of the aforecited statute provides:
case of beer at the time of the removal". Provided, That municipalities and municipal districts shall, in no case, impose any
Claiming that it is adversely affected by the ordinance, which in its view was beyond the percentage tax on sales or other taxes in any form based thereon nor impose taxes on
power and authority of the municipality to enact, petitioner brought and action in the articles subject to specific tax ... .
Court of First Instance of Cebu, Branch VI, for the annulment of said ordinance. Section 1 of Ordinance No. 88 of the Municipality of Mandaue, as amended by Ordinances
Petitioner contends that (1) the phrase "gross value in money or actual market value" Nos. 23 (1967) and 25 (1968), specifically provides that the graduated quarterly tax shall
employed in the questioned ordinance clearly referred to "sales or market price" of the be "based on the gross value in money or actual market value at the time of removal, of
articles or commodities manufactured thereby indicating a manifest intent to impose a tax the manufactured products ... from their factories ... during the preceding calendar year ...
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 Well settled is the rule that in the absence of legislative intent to the contrary, technical or
same as imposing a tax upon the product itself. commercial terms and phrases, when used in tax statutes, are presumed to have been
Respondents upon the other hand insist that the tax imposed in the questioned ordinance used in their technical sense or in their trade or commercial meaning. Thus, the phrase
(1) is not a percentage tax or a tax on the sales of beer but is a tax on the privilege to "gross value in money" has a well-defined meaning in our tax statutes. For instance, the
engage in the business of manufacturing beer, and the phrase "actual market value" was term "gross value in money" of articles sold, bartered, exchanged or transferred, as used
merely employed as a basis for the classification and graduation of the tax sought to be in Sections 184, 185 and 186 of the National Internal Revenue Code, has been invariably
imposed; (2) that it is not a specific tax because it is not a tax on the beer itself, but on the used as equivalent to "gross selling price" and has been construed as the total amount of
privilege of manufacturing beer; and (3) that with conversion of Mandaue into a city on money or its equivalent which the purchaser pays to the vendor to receive or get the
June 21, 1969, the appeal has become moot, because the prohibition against the goods.4 It must be noted that the ordinance specifically provides that the basis of the tax
imposition of any privilege tax on sales or other taxes in any form based thereon, is is the "gross value in money or actual market value" of the manufactured article.
applicable only to municipalities. The phrase "actual market value" has been construed as the price which an article "would
While We have heretofore announced the doctrine that the grant of power to tax to command in the ordinary course of business, that is to say, when offered for sale by one
charterred cities and municipalities under Section 2 of the Local Autonomy Act is willing to sell, but not under compulsion to sell, and purchased by another who is willing
sufficiently plenary,2 it is, however, subject to the exceptions and limitations contained in to buy, but under no obligation purchase it,5 or the price which the property will bring in a
the two (2) provisos of the same statute. In other words, the municipal corporation should fair market after fair and reasonable efforts have been made to find a purchaser who will
not transcend the limitations imposed by the statute on the basis of which the power to give the highest price for it.6 The "actual market value" of property, for purposes of
tax is sought to be exercised. Thus, We held in the Marinduque case,3 that an ordinance taxation, therefore means the selling price of the article in the course of ordinary
business.
 3

Considering that the phrase "gross value in money" is followed by the words "or actual Similarly, in the case at bar, the circumstance that the tax is imposed upon petitioner at
market value", it is evident that the latter was intended to explain and clarify the time of removal from the factory of the manufactured beer, and not on the date of actual
preceding phrase. For the word "or" may be used as the equivalent of "that is to say" and sale, is not of important consequence since petitioner will, in the end, sell the beer
gives that which precedes it the same significance as that which follows it. It is not always removed from the factory, because by the nature of its business, it has no alternative but
disjunctive and is sometimes interpretative or expository of the preceding to sell what it has manufactured.
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 We therefore hold that the questioned ordinance imposed tax based on sales and
phrase. In any event, it is the duty of the courts, so far reasonably practicable, to read and therefore beyond the authority of the municipality to enact.
interpret a statute as to give life and effect to its provisions, so as to render it a Having reached this conclusion, it becomes unnecessary to pass upon the additional
harmonious whole. question posed, i.e., whether or not the challenged ordinance imposes a tax on a product
It is also significant to note, that there is a set ratio between the amount of the tax and subject to specific tax.
the volume of sales. Thus if the "gross value in money or actual market value" of the beer Respondents however claim that with the conversion Mandaue into a city pursuant to
removed from the factory exceeds P37,500.00 per quarter, the taxpayer is required to pay Republic Act No. 5519, which was approved on June 21, 1969, the issue has already
a quarterly license tax of P160.00 plus P0.30 for every P1,000.00 or fraction of the excess. become moot, since the prohibition contained in section 2 of Republic Act 2264 applies
In other words in excess of P37,500.00, the taxpayer will pay to the municipality a certain only to municipalities and not to chartered cities. The same contention has been rejected
amount of tax measured by a percentage of the sales. It is therefore evident that the in City of Naga v. Court of Appeals,9 and Laoag Producers' Cooperative Marketing
challenged ordinance was a transparent attempt on the part of the municipality to impose Association, Inc. v. Municipality of Laoag, supra, where We ruled that the legality of an
a tax based on sales. ordinance depends upon the power of the municipality at the time of the enactment the
Although section 2 of the ordinance in question provides in a vague manner that the tax challenged ordinance. Since the municipality of Mandaue had no authority to enact the
shall be assessed and collected on the basis of the sworn statement of the manager of a said ordinance, the subsequent approval of Republic Act No. 5519 which became effective
firm or corporation "of the gross value in money during the preceding quarter," in actual June 21, 1969, did not remove the original infirmity of the ordinance. Indeed there is no
practice the quarterly tax levied upon the petitioner, was computed on the basis of the provision in the aforecited statute which invests a curative effect upon the ordinances of
total market of the beer, per quarter, as shown by the shipping memorandum certified to the municipality which when enacted were beyond its statutory authority.
by the storekeeper of the Bureau Internal Revenue assigned to the brewery. Thus the IN VIEW WHEREOF, the appealed judgment is hereby reversed and Ordinance No. 23,
amounting to P309.40 and P5,171.80, paid by petition January 22, 1968 and July 18, 1968, series of 1966, as amended by Ordinance No. 23, series of 1966, which became effective
were actually determined respectively on the basis of 70,412 and 2,203.070 cases January 1, 1968, of the Municipality of Mandaue, Cebu, is hereby declared null and void.
manufactured and removed from the Mandaue plant, multiplied by P7.60 which is the Respondents are also ordered to refund the taxes paid by Petitioners under the said
prevailing market price (wholesaler's price) per case of beer. ordinance, with legal interest thereon. No costs.
In Laoag Producers' Cooperative Marketing Association, Inc. vs. Municipality of Laoag,8 We Makalintal, Actg. C.J., Zaldivar, Castro, Teehankee Makasiar and Esguerra, JJ., concur.
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 Fernando and Barredo, JJ., took no part.
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."
 4

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
G.R. No. L-12687 August 27, 1918 of to consumers or persons, etc., prior to the first day of January, 1915. That being true,
THE ASIATIC PETROLEUM COMPANY (LTD.), plaintiff-appellant, the question is presented; Were the oils in question which plaintiff had sold, but which he
vs. had not delivered, prior to the first day of January, 1915, disposed of, so as to relieve him
THE INSULAR COLLECTOR OF INTERNAL REVENUE, defendant-appellant. from the necessity of paying tax? No question is raised as to oils sold and delivered prior to
January 1, 1915.
Crossfield and O'Brien for plaintiff.
Acting Attorney-General Paredes for defendant. 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
JOHNSON, J.: 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
For the reason that the facts were analogous, this case was heard and decided with cause were "disposed of." If the Legislature had intended that the phrase "dispose of" meant
No. 13400 [of the Court of First Instance of Manila], entitled "The Asiatic Petroleum "sold and delivered," it is strange that it did not use the latter phrase. The Legislature
Company (Ltd.) vs. The Collector of Customs and The Collector of Internal Revenue." evidently took into consideration the custom of merchants in their use of the phrase
The only question presented by this appeal is whether or not a dealer is required to pay the "dispose of." That phrase is used in the law evidently in its commercial sense and not in a
internal revenue tax, provided for under section 17, (paragraph 72a) of Act No. 2342, upon technical sense. Words and phrases, which are in common use among merchants and are
mineral oils, but not delivered, prior to the first day of January, 1915. 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
The facts in this case are not in dispute. They are: applies and where the word or phrase has been in common use.

The defendant, under threat of penalty, compelled the plaintiff to pay the internal revenue If A should step into the store of B and say to B that he desired to purchase 5 sacks of rice,
tax provided for under above said section of Act No. 2432 upon all such oils which the and should then and there pay for the same, even though they were not then and there
plaintiff had on hand on the first day of January, 1915, whether or not the same had been delivered, B would be perfectly justified, in taking an inventory of his business, in noting
sold theretofore or not. The tax was paid under protest. 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
The plaintiff contends that the tax collected was illegal, for the reason that the law had of circumstances might alter the situation and give rise to other questions relating to the
expressly relieved him from the necessity of paying the same on all such oils which he had rice.
"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 Merchandise may be "disposed of" even though the price has not been paid nor the same
before January 1, 1915 even though the same had not been actually delivered they had delivered. A sale may be perfected between vendor and vendee and may be binding on
been "disposed of" and he was therefore relieved from the necessity of paying the tax both of them, if they have agreed upon the thing, the object of the contract and the price,
imposed by said Act. No contention is made that the oils "disposed of" had been disposed even though the price had not been paid nor the merchandise delivered. (Art. 1450, Civil
of to "manufacturers or wholesale dealers." Code.)

Section 17 (paragraph 72a) of Act No. 2432, among other things, provides that "no tax The Legislature, by Act No. 2445, fully recognized that the phrase "disposed of" meant
(imposed by law) shall be collected on such articles have been disposed of to consumers or nothing more or less than a contract whereby the vendor was bound to furnish an article,
persons other than manufacturers or wholesale dealers. Said Act took effect upon the first because in said Act (No. 2445) it provided that "whenever any person has prior to the
day of January, 1915. enactment of this law (2432) entered into a contract whereby he has bound himself to
 5

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.

Arellano, C.J., Torres, Street, Malcolm and Fisher, JJ., concur.

 6

G.R. No. L-630 November 15, 1947 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
ALEXANDER A. KRIVENKO, petitioner-appellant, lots to aliens. The herein respondent-appellee was naturally one of the registers of deeds
vs. to obey the new circular, as against his own stand in this case which had been maintained
THE REGISTER OF DEEDS, CITY OF MANILA, respondent and appellee. by the trial court and firmly defended in this Court by the Solicitor General. If we grant the
Gibbs, Gibbs, Chuidian and Quasha of petitioner-appellant. withdrawal, the the result would be that petitioner-appellant Alexander A. Krivenko wins
First Assistant Solicitor General Reyes and Solicitor Carreon for respondent-appellee. his case, not by a decision of this Court, but by the decision or circular of the Department
Marcelino Lontok appeared as amicus curies. 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
MORAN, C.J.: 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
Alenxander A. Kriventor alien, bought a residential lot from the Magdalena Estate, Inc., in exercise by this Court of its constitutional functions, and whether or not after having held
December of 1941, the registration of which was interrupted by the war. In May, 1945, he long deliberations and after having reached a clear and positive conviction as to what the
sought to accomplish said registration but was denied by the register of deeds of Manila constitutional mandate is, we may still allow our conviction to be silenced, and the
on the ground that, being an alien, he cannot acquire land in this jurisdiction. Krivenko constitutional mandate to be ignored or misconceived, with all the harmful consequences
then brought the case to the fourth branch of the Court of First Instance of Manila by that might be brought upon the national patromony. For it is but natural that the new
means of a consulta, and that court rendered judgment sustaining the refusal of the circular be taken full advantage of by many, with the circumstance that perhaps the
register of deeds, from which Krivenko appealed to this Court. constitutional question may never come up again before this court, because both vendors
There is no dispute as to these facts. The real point in issue is whether or not an alien and vendees will have no interest but to uphold the validity of their transactions, and very
under our Constitution may acquire residential land. 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
It is said that the decision of the case on the merits is unnecessary, there being a motion to result that our indifference of today might signify a permanent offense to the Constitution.
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 All thse circumstances were thoroughly considered and weighted by this Court for a
upon a constitutional question if its judgment may be made to rest upon other grounds. number of days and the legal result of the last vote was a denial of the motion
There is, we believe, a confusion of ideas in this reasoning. It cannot be denied that the withdrawing the appeal. We are thus confronted, at this stage of the proceedings, with our
constitutional question is unavoidable if we choose to decide this case upon the merits. duty, the constitutional question becomes unavoidable. We shall then proceed to decide
Our judgment cannot to be made to rest upon other grounds if we have to render any that question.
judgment at all. And we cannot avoid our judgment simply because we have to avoid a Article XIII, section 1, of the Constitutional is as follows:
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 Article XIII. — Conservation and utilization of natural resources.
should not be, granted, is a question involving different considerations now to be stated.
SECTION 1. All agricultural, timber, and mineral lands of the public domain, water,
According to Rule 52, section 4, of the Rules of Court, it is discretionary upon this Court to minerals, coal, petroleum, and other mineral oils, all forces of potential energy, and other
grant a withdrawal of appeal after the briefs have been presented. At the time the motion natural resources of the Philippines belong to the State, and their disposition, exploitation,
for withdrawal was filed in this case, not only had the briefs been prensented, but the case development, or utilization shall be limited to citizens of the Philippines, or to corporations
had already been voted and the majority decision was being prepared. The motion for or associations at least sixty per centum of the capital of which is owned by such citizens,
withdrawal stated no reason whatsoever, and the Solicitor General was agreeable to it. subject to any existing right, grant, lease, or concession at the time of the inaguration of
 7

the Government established uunder this Constitution. Natural resources, with the no special provision with respect to building lots or urban lands that have ceased to be
exception of public agricultural land, shall not be alienated, and no licence, concession, or agricultural land.
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 In other words, the Court ruled that in determining whether a parcel of land is agricultural,
years, except as to water rights for irrigation, water supply, fisheries, or industrial uses the test is not only whether it is actually agricultural, but also its susceptibility to
other than the development of water "power" in which cases beneficial use may be the cultivation for agricultural purposes. But whatever the test might be, the fact remains that
measure and the limit of the grant. at the time the Constitution was adopted, lands of the public domain were classified in our
laws and jurisprudence into agricultural, mineral, and timber, and that the term "public
The scope of this constitutional provision, according to its heading and its language, agricultural lands" was construed as referring to those lands that were not timber or
embraces all lands of any kind of the public domain, its purpose being to establish a mineral, and as including residential lands. It may safely be presumed, therefore, that
permanent and fundamental policy for the conservation and utilization of all natural what the members of the Constitutional Convention had in mind when they drafted the
resources of the Nation. When, therefore, this provision, with reference to lands of the Constitution was this well-known classification and its technical meaning then prevailing.
public domain, makes mention of only agricultural, timber and mineral lands, it means
that all lands of the public domain are classified into said three groups, namely, Certain expressions which appear in Constitutions, . . . are obviously technical; and where
agricultural, timber and mineral. And this classification finds corroboration in the such words have been in use prior to the adoption of a Constitution, it is presumed that its
circumstance that at the time of the adoption of the Constitution, that was the basic framers and the people who ratified it have used such expressions in accordance with their
classification existing in the public laws and judicial decisions in the Philippines, and the technical meaning. (11 Am. Jur., sec. 66, p. 683.) Also Calder vs. Bull, 3 Dall. [U.S.], 386; 1
term "public agricultural lands" under said classification had then acquired a technical Law. ed., 648; Bronson vs. Syverson, 88 Wash., 264; 152 P., 1039.)
meaning that was well-known to the members of the Constitutional Convention who were It is a fundamental rule that, in construing constitutions, terms employed therein shall be
mostly members of the legal profession. given the meaning which had been put upon them, and which they possessed, at the time
As early as 1908, in the case of Mapa vs. Insular Government (10 Phil., 175, 182), this of the framing and adoption of the instrument. If a word has acquired a fixed, technical
Court said that the phrase "agricultural public lands" as defined in the Act of Congress of meaning in legal and constitutional history, it will be presumed to have been employed in
July 1, 1902, which phrase is also to be found in several sections of the Public Land Act (No. that sense in a written Constitution. (McKinney vs. Barker, 180 Ky., 526; 203 S.W., 303;
926), means "those public lands acquired from Spain which are neither mineral for timber L.R.A., 1918 E, 581.)
lands." This definition has been followed in long line of decisions of this Court. Where words have been long used in a technical sense and have been judicially construed
(See Montano vs. Insular Government, 12 Phil., 593; Ibañez de Aldecoa vs. Insular to have a certain meaning, and have been adopted by the legislature as having a certain
Government, 13 Phil., 159; Ramos vs. Director of Lands, 39 Phil., 175; Jocson vs. Director of meaning prior to a particular statute in which they are used, the rule of construction
Forestry, 39 Phil., 560; Ankron vs. Government of the Philippines, 40 Phil., 10.) And with requires that the words used in such statute should be construed according to the sense in
respect to residential lands, it has been held that since they are neither mineral nor timber which they have been so previously used, although the sense may vary from strict literal
lands, of necessity they must be classified as agricultural. In Ibañez de Aldecoa vs. Insular meaning of the words. (II Sutherland, Statutory Construction, p. 758.)
Government (13 Phil., 159, 163), this Court said:
Therefore, the phrase "public agricultural lands" appearing in section 1 of Article XIII of the
Hence, any parcel of land or building lot is susceptible of cultivation, and may be converted Constitution must be construed as including residential lands, and this is in conformity with
into a field, and planted with all kinds of vegetation; for this reason, where land is not a legislative interpretation given after the adoption of the Constitution. Well known is the
mining or forestal in its nature, it must necessarily be included within the classification of rule that "where the Legislature has revised a statute after a Constitution has been
agricultural land, not because it is actually used for the purposes of agriculture, but adopted, such a revision is to be regarded as a legislative construction that the statute so
because it was originally agricultural and may again become so under other revised conforms to the Constitution." (59 C.J., 1102.) Soon after the Constitution was
circumstances; besides, the Act of Congress contains only three classification, and makes
 8

adopted, the National Assembly revised the Public Land Law and passed Commonwealth Section 1, Article XII (now XIII) of the Constitution classifies lands of the public domain in
Act No. 141, and sections 58, 59 and 60 thereof permit the sale of residential lots to the Philippines into agricultural, timber and mineral. This is the basic classification adopted
Filipino citizens or to associations or corporations controlled by such citizens, which is since the enactment of the Act of Congress of July 1, 1902, known as the Philippine Bill. At
equivalent to a solemn declaration that residential lots are considered as agricultural the time of the adoption of the Constitution of the Philippines, the term 'agricultural public
lands, for, under the Constitution, only agricultural lands may be alienated. 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
It is true that in section 9 of said Commonwealth Act No. 141, "alienable or disposable that the phrase 'agricultural public lands' means those public lands acquired from
public lands" which are the same "public agriculture lands" under the Constitution, are Spain which are neither timber nor mineral lands. This definition has been followed by our
classified into agricultural, residential, commercial, industrial and for other puposes. This Supreme Court in many subsequent case. . . .
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 Residential commercial, or industrial lots forming part of the public domain must have to
lands that are neither timber nor mineral. This broad meaning is particularized in section 9 be included in one or more of these classes. Clearly, they are neither timber nor mineral, of
of Commonwealth Act No. 141 which classifies "public agricultural lands" for purposes of necessity, therefore, they must be classified as agricultural.
alienation or disposition, into lands that are stricly agricultural or actually devoted to
cultivation for agricultural puposes; lands that are residential; commercial; industrial; or Viewed from another angle, it has been held that in determining whether lands are
lands for other purposes. The fact that these lands are made alienable or disposable under agricultural or not, the character of the land is the test (Odell vs. Durant, 62 N.W., 524;
Commonwealth Act No. 141, in favor of Filipino citizens, is a conclusive indication of their Lorch vs. Missoula Brick and Tile Co., 123 p.25). In other words, it is the susceptibility of the
character as public agricultural lands under said statute and under the Constitution. land to cultivation for agricultural purposes by ordinary farming methods which
determines whether it is agricultural or not (State vs. Stewart, 190 p. 129).
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 Furthermore, as said by the Director of Lands, no reason is seen why a piece of land, which
or residential puposes, but after the Constitution and under section 23 of Commonwealth may be sold to a person if he is to devote it to agricultural, cannot be sold to him if he
Act No. 141, the right of aliens to acquire such kind of lands is completely stricken out, intends to use it as a site for his home.
undoubtedly in pursuance of the constitutional limitation. And, again, prior to the This opinion is important not alone because it comes from a Secratary of Justice who later
Constitution, under section 57 of Public Land Act No. 2874, land of the public domain became the Chief Justice of this Court, but also because it was rendered by a member of
suitable for residence or industrial purposes could be sold or leased to aliens, but after the the cabinet of the late President Quezon who actively participated in the drafting of the
Constitution and under section 60 of Commonwealth Act No. 141, such land may only be constitutional provision under consideration. (2 Aruego, Framing of the Philippine
leased, but not sold, to aliens, and the lease granted shall only be valid while the land is Constitution, p. 598.) And the opinion of the Quezon administration was reiterated by the
used for the purposes referred to. The exclusion of sale in the new Act is undoubtedly in Secretary of Justice under the Osmeña administration, and it was firmly maintained in this
pursuance of the constitutional limitation, and this again is another legislative Court by the Solicitor General of both administrations.
construction that the term "public agricultural land" includes land for residence purposes.
It is thus clear that the three great departments of the Government — judicial, legislative
Such legislative interpretation is also in harmony with the interpretation given by the and executive — have always maintained that lands of the public domain are classified
Executive Department of the Government. Way back in 1939, Secretary of Justice Jose into agricultural, mineral and timber, and that agricultural lands include residential lots.
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 Under section 1 of Article XIII of the Constitution, "natural resources, with the exception of
residential, commercial, and industrial lands for purposes of their disposition," rendered public agricultural land, shall not be aliented," and with respect to public agricultural
the following short, sharp and crystal-clear opinion: 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
 9

the Filipino citizens themselves who may alienate their agricultural lands in favor of aliens. important, for time will come when, in view of the constant disposition of public lands in
It is partly to prevent this result that section 5 is included in Article XIII, and it reads as favor of private individuals, almost all, if not all, the residential lands of the public domain
follows: shall have become private residential lands.

Sec. 5. Save in cases of hereditary succession, no private agricultural land will be It is maintained that in the first draft of section 5, the words "no land of private ownership"
transferred or assigned except to individuals, corporations, or associations qualified to were used and later changed into "no agricultural land of private ownership," and lastly
acquire or hold lands of the public domain in the Philippines. into "no private agricultural land" and from these changes it is argued that the word
"agricultural" introduced in the second and final drafts was intended to limit the meaning
This constitutional provision closes the only remaining avenue through which agricultural of the word "land" to land actually used for agricultural purposes. The implication is not
resources may leak into aliens' hands. It would certainly be futile to prohibit the alienation accurate. The wording of the first draft was amended for no other purpose than to clarify
of public agricultural lands to aliens if, after all, they may be freely so alienated upon their concepts and avoid uncertainties. The words "no land" of the first draft, unqualified by the
becoming private agricultural lands in the hands of Filipino citizens. Undoubtedly, as above word "agricultural," may be mistaken to include timber and mineral lands, and since under
indicated, section 5 is intended to insure the policy of nationalization contained in section section 1, this kind of lands can never be private, the prohibition to transfer the same
1. Both sections must, therefore, be read together for they have the same purpose and the would be superfluous. Upon the other hand, section 5 had to be drafted in harmony with
same subject matter. It must be noticed that the persons against whom the prohibition is section 1 to which it is supplementary, as above indicated. Inasmuch as under section 1,
directed in section 5 are the very same persons who under section 1 are disqualified "to timber and mineral lands can never be private, and the only lands that may become
acquire or hold lands of the public domain in the Philippines." And the subject matter of private are agricultural lands, the words "no land of private ownership" of the first draft
both sections is the same, namely, the non-transferability of "agricultural land" to aliens. can have no other meaning than "private agricultural land." And thus the change in the
Since "agricultural land" under section 1 includes residential lots, the same technical final draft is merely one of words in order to make its subject matter more specific with a
meaning should be attached to "agricultural land under section 5. It is a rule of statutory view to avoiding the possible confusion of ideas that could have arisen from the first draft.
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 If the term "private agricultural lands" is to be construed as not including residential lots or
Construction, p. 758.) The only difference between "agricultural land" under section 5, is lands not strictly agricultural, the result would be that "aliens may freely acquire and
that the former is public and the latter private. But such difference refers to ownership and possess not only residential lots and houses for themselves but entire subdivisions, and
not to the class of land. The lands are the same in both sections, and, for the conservation whole towns and cities," and that "they may validly buy and hold in their names lands of
of the national patrimony, what is important is the nature or class of the property any area for building homes, factories, industrial plants, fisheries, hatcheries, schools,
regardless of whether it is owned by the State or by its citizens. 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." (Solicitor
Reference is made to an opinion rendered on September 19, 1941, by the Hon. Teofilo General's Brief, p. 6.) That this is obnoxious to the conservative spirit of the Constitution is
Sison, then Secretary of Justice, to the effect that residential lands of the public domain beyond question.
may be considered as agricultural lands, whereas residential lands of private ownership
cannot be so considered. No reason whatsoever is given in the opinion for such a One of the fundamental principles underlying the provision of Article XIII of the
distinction, and no valid reason can be adduced for such a discriminatory view, particularly Constitution and which was embodied in the report of the Committee on Nationalization
having in mind that the purpose of the constitutional provision is the conservation of the and Preservation of Lands and other Natural Resources of the Constitutional Convention,
national patrimony, and private residential lands are as much an integral part of the is "that lands, minerals, forests, and other natural resources constitute the exclusive
national patrimony as the residential lands of the public domain. Specially is this so where, heritage of the Filipino nation. They should, therefore, be preserved for those under the
as indicated above, the prohibition as to the alienable of public residential lots would sovereign authority of that nation and for their posterity." (2 Aruego, Framing of the
become superflous if the same prohibition is not equally applied to private residential lots. Filipino Constitution, p. 595.) Delegate Ledesma, Chairman of the Committee on
Indeed, the prohibition as to private residential lands will eventually become more Agricultural Development of the Constitutional Convention, in a speech delivered in
 10

connection with the national policy on agricultural lands, said: "The exclusion of aliens SEC. 121. No land originally acquired in any manner under the provisions of the former
from the privilege of acquiring public agricultural lands and of owning real estate is a Public Land Act or of any other Act, ordinance, royal order, royal decree, or any other
necessary part of the Public Land Laws of the Philippines to keep pace with the idea of provision of law formerly in force in the Philippine Islands with regard to public
preserving the Philippines for the Filipinos." (Emphasis ours.) And, of the same tenor was lands, terrenos baldios y realengos, or lands of any other denomination that were actually
the speech of Delegate Montilla who said: "With the complete nationalization of our lands or presumptively of the public domain or by royal grant or in any other form, nor any
and natural resources it is to be understood that our God-given birthright should be one permanent improvement on such land, shall be encumbered, alienated, or conveyed,
hundred per cent in Filipino hands . . .. Lands and natural resources are immovables and as except to persons, corporations, or associations who may acquire land of the public
such can be compared to the vital organs of a person's body, the lack of possession of domain under this Act; to corporate bodies organized in the Philippine Islands whose
which may cause instant death or the shortening of life. If we do not completely charters may authorize them to do so, and, upon express authorization by the Philippine
antionalize these two of our most important belongings, I am afraid that the time will Legislature, to citizens of the countries the laws of which grant to citizens of the Philippine
come when we shall be sorry for the time we were born. Our independence will be just a Islands the same right to acquire, hold, lease, encumber, dispose of, or alienate land or
mockery, for what kind of independence are we going to have if a part of our country is not pemanent improvements thereon or any interest therein, as to their own citizens, and only
in our hands but in those of foreigners?" (Emphasis ours.) Professor Aruego says that since in the manner and to the extent specified in such laws, and while the same are in force, but
the opening days of the Constitutional Convention one of its fixed and dominating not thereafter: Provided, however, That this prohibition shall not be applicable to the
objectives was the conservation and nationalization of the natural resources of the conveyance or acquisition by reason of hereditary succession duly acknowledged and
country. (2 Aruego, Framing of the Philippine Constitution, p 592.) This is ratified by the legalized by competent courts, nor to lands and improvements acquired or held for
members of the Constitutional Convention who are now members of this Court, namely, industrial or residence purposes, while used for such purposes: Provided, further, That in
Mr. Justice Perfecto, Mr. Justice Briones, and Mr. Justice Hontiveros. And, indeed, if under the event of the ownership of the lands and improvements mentioned in this section and in
Article XIV, section 8, of the Constitution, an alien may not even operate a small jitney for the last preceding section being transferred by judicial decree to persons,corporations or
hire, it is certainly not hard to understand that neither is he allowed to own a pieace of associations not legally capacitated to acquire the same under the provisions of this Act,
land. 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
This constitutional intent is made more patent and is strongly implemented by an act of penalty of such property reverting to the Government in the contrary case." (Public Land
the National Assembly passed soon after the Constitution was approved. We are referring Act, No. 2874.)
again to Commonwealth Act No. 141. Prior to the Constitution, there were in the Public
Land Act No. 2874 sections 120 and 121 which granted aliens the right to acquire private It is to be observed that the pharase "no land" used in these section refers to all private
only by way of reciprocity. Said section reads as follows: 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
SEC. 120. No land originally acquired in any manner under the provisions of this Act, nor sections. Therefore, the prohibition contained in these two provisions was, in effect, that
any permanent improvement on such land, shall be encumbered, alienated, or transferred, no private land could be transferred to aliens except "upon express authorization by the
except to persons, corporations, associations, or partnerships who may acquire lands of Philippine Legislature, to citizens of Philippine Islands the same right to acquire, hold,
the public domain under this Act; to corporations organized in the Philippine Islands lease, encumber, dispose of, or alienate land." In other words, aliens were granted the
authorized therefor by their charters, and, upon express authorization by the Philippine right to acquire private land merely by way of reciprocity. Then came the Constitution and
Legislature, to citizens of countries the laws of which grant to citizens of the Philippine Commonwealth Act No. 141 was passed, sections 122 and 123 of which read as follows:
Islands the same right to acquire, hold, lease, encumber, dispose of, or alienate land, or
permanent improvements thereon, or any interest therein, as to their own citizens, only in SEC. 122. No land originally acquired in any manner under the provisions of this Act, nor
the manner and to the extent specified in such laws, and while the same are in force but any permanent improvement on such land, shall be encumbered, alienated, or transferred,
not thereafter. except to persons, corporations, associations, or partnerships who may acquire lands of
 11

the public domain under this Act or to corporations organized in the Philippines authorized consisting of expressly prohibiting aliens to bid or take part in any sale of such real
thereof by their charters. 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
SEC. 123. No land originally acquired in any manner under the provisions of any previous commercial. The prohibition embraces the sale of private lands of any kind in favor of
Act, ordinance, royal order, royal decree, or any other provision of law formerly in force in aliens, which is again a clear implementation and a legislative interpretation of the
the Philippines with regard to public lands terrenos baldios y realengos, or lands of any constitutional prohibition. Had the Congress been of opinion that private residential lands
other denomination that were actually or presumptively of the public domain, or by royal may be sold to aliens under the Constitution, no legislative measure would have been
grant or in any other form, nor any permanent improvement on such land, shall be found necessary to authorize mortgage which would have been deemed also permissible
encumbered, alienated, or conveyed, except to persons, corporations or associations who under the Constitution. But clearly it was the opinion of the Congress that such sale is
may acquire land of the public domain under this Act or to corporate bodies organized in forbidden by the Constitution and it was such opinion that prompted the legislative
the Philippines whose charters authorize them to do so: Provided, however, That this measure intended to clarify that mortgage is not within the constitutional prohibition.
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 It is well to note at this juncture that in the present case we have no choice. We are
in the event of the ownership of the lands and improvements mentioned in this section and construing the Constitution as it is and not as we may desire it to be. Perhaps the effect of
in the last preceding section being transferred by judicial decree to persons, corporations our construction is to preclude aliens, admitted freely into the Philippines from owning
or associations not legally capacitated to acquire the same under the provisions of this Act, sites where they may build their homes. But if this is the solemn mandate of the
such persons, corporations, or associations shall be obliged to alienate said lands or Constitution, we will not attempt to compromise it even in the name of amity or equity.
improvements to others so capacitated within the precise period of five years; otherwise, We are satisfied, however, that aliens are not completely excluded by the Constitution
such property shall revert to the Government. from the use of lands for residential purposes. Since their residence in the Philippines is
temporary, they may be granted temporary rights such as a lease contract which is not
These two sections are almost literally the same as sections 120 and 121 of Act No. 2874, forbidden by the Constitution. Should they desire to remain here forever and share our
the only difference being that in the new provisions, the right to reciprocity granted to fortunes and misfortunes, Filipino citizenship is not impossible to acquire.
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 For all the foregoing, we hold that under the Constitution aliens may not acquire private or
of private agricultural lands to aliens, grants them no right of reciprocity. This legislative public agricultural lands, including residential lands, and, accordingly, judgment is
construction carries exceptional weight, for prominent members of the National Assembly affirmed, without costs.
who approved the new Act had been members of the Constitutional Convention.
Feria, Pablo, Perfecto, Hilado, and Briones, JJ., concur.
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
 12

[No. 244. May 31, 1904.] 670

KEPNER vs. UNITED STATES,1 670 PHILIPPINE REPORTS ANNOTATED

The expressed declarations of the President in Military Order, No. 58, of April 23, 1900, and KEPNER VS. UNITED STATES.
in the act of July 1, 1902, establishing a civil government in the Philippine Islands, both
adopting with little alteration the provisions of the Bill of Rights, show that it was intended
to carry to the Philippine Islands those principles of our Government which the President
The factrs, which involved the application of the constitutional immunity provision of the
declared to be established as rules of law for the maintenance of individual freedom; and
Constitution of the United States to the Philippine Islands, are stated in the opinion of the
those expressions were used in the sense which has been placed upon them in construing
court.
the instrument from which they were taken.
Mr. Charles H. Aldrich for plaintiff in error.1 The result of De Lima vs. Bidwell and the
It is a well-settled rule of construction that language used in a statute which has a settled
Fourteen Diamond Kings case made these Islands territory of the United States. They
and well-known meaning, sanctioned by judicial decision, is presumed to be used in that
ceased to be foreign in any sense. Hence tariff laws were not applicable until Congress had
sense by the legislative body.
made them so.
It is a well settled principle of construction that specific terms covering the given subject
That the term “United States” in the uniformity clause had a restricted meaning and that
matter will prevail over general language of the same or another statute which might
these possessions were not within ,that clause of the Constitution, was the judgment of a
otherwise prove controlling.
majority of this court.
Although a right of appeal was given to the Government by Military Order, No. 58, in
The status of the Philippine Archipelago is fixed as territory of the United States. (Fourteen
criminal cases in the Philippine Islands, section 5 of the act of July 1, 1902, establishing a
Diamond Rings case, 183 U.S., 176, 179.)
civil government in the Islands, specifically provided that no person should be put twice in
jeopardy for the same offense, thereby repealing the provision in the military order and The question whether any particular provision is applicable depends upon whether
nothing in section 9 of the act of 1902 can be construed as intending to prevail over the Congress has extended that provision to such territory.
specific guaranty contained in section 5.
Considered in connection with the Hawaiian case, even the application of the Bill of Rights,
In ascertaining the meaning of a phrase in the Constitution taken from the Bill of Rights, it so called, becomes a question of relation.
must be construed with reference to the common law from which it was taken.
If we assume that enough has been done in the Philippines to incorporate them into the
At common law protection from second jeopardy for the same offense clearly included United States as required by one section of this court, or to extend the Constitution thereto
immunity from second prosecution where the court having jurisdiction had acquitted the as demanded, by another view here expressed, then clearly the plaintiff in error must
accused of the offense; and it is the settled law of this court that former jeopardy includes succeed.
one who has been acquitted by a verdict duly rendered, although no judgment be entered
on the verdict, and it was found upon a defective indictment. The second jeopardy is not Again, if every agency of the Government is bound by these limitations upon the powers of
against the peril of second judgment, but against being again tried for the same offense. Congress upon the establishment of civil government in the Philippines in dealing with
persons not in the military service of the United States, the plaintiff in error must be
________________ sustained. (See Hawaii vs. Mankichi, 190 U.S., 197, 217; White, J., in same, p. 221; Harlan,
J., in same, p. 237; Downes vs. Bidwell, White, J., concurring opinion, 182 U.S., 244, 288,
1 195 U.S., 100.
 13

_______________ They are all in the Constitution of equal dignity, if we look to that instrument alone. (See
Reynolds vs. United States, 98 U.S., 145, 154, 162; Callan vs. Wilson, 127 U.S., 540, 549;
1 Dorr vs, United States, No. 584, post, and Mendezona vs. United States, No. 583, post, Springville vs. Thomas, 166 U.S., 707; Publishing Co. vs. Fisher, 166 U.S., 464; Bauman vs.
were argued simultaneously with this case.
672
671
672 PHILIPPINE REPORTS ANNOTATED
VOL. 11, MAY 31, 1904 671
KEPNER VS. UNITED STATES.
KEPNER VS. UNITED STATES.

Ross, 167 U.S., 548; Thompson vs. Utah, 170 U.S., 343; Capital Traction Co. vs. Hof, 174
citing McLean, J., in Dred Scott vs. Sanford, 19 How., 393, 542; Curtis, J., in same, p. 614.) U.S., 1, 5, 45; Black vs. Jackson, 177 U.S., 349, 363.)
The Territory being territory of the United States can only be governed by agencies of the The cases relating to the Territories and those relating to the District of Columbia are
United States, and as these agents are limited in their powers by the Constitution, it treated by this court as resting upon the same principle. It is evident that this is so, there
follows that without action by Congress, that is, in the absence of any action by Congress, being no distinction to be drawn between the power to make rules and regulations
unconstitutional acts may not be lawfully done in the Philippines. respecting the territory of the United States, and the power to exercise exclusive
It has been repeatedly stated by this court that while municipal law in force under the legislation, in all cases whatsoever, in the District; none, at least, which would tend to give
former sovereign remained in force as governing private persons and property, until less effect to the constitutional prohibitions in the former case than in the latter. The
changed by Congress, those laws which were in conflict with our Constitution and the spirit decisions in all these cases have been unanimous on the point to which we cite them. Every
of our institutions were by the fact of acquisition abrogated. (Dred Scott vs. Sanford, 19 member of the bench, as it is now constituted, has participated in one or more of them,
How., 398, 450; Fong Yue Ting vs. United States, 149 U.S., 716, 738; Pollard vs. Hagan, 3 and the same is true, with, we believe, a single exception, of every one of its distinguished
How., 212, 225; Leitensdorfer vs. Webb, 20 How., 176; Murphy vs. Ramsey, 114 U.S., 15, occupants since 1878.
44; Chicago, R.I. & P. vs. McGlinn, 114 U.S., 542, 546; Downes vs. Bidwell, White, J., 182 See also Wong Wing vs. United States (163 U.S., 228), citing on p. 238, Yick Wo vs. Hopkins
U.S., 244, 291.) (118 U.S., 300), to effect that the provisions of the Fourteenth Amendment to secure life,
Why appeal to the spirit of our institutions, when we have the spirit embodied in these liberty and property, “are universal in their ,application to all persons within the territorial
amendments constituting a bill of rights, a Magna Charta, as they were frequently called jurisdiction.” And see Webster vs. Reid (11 How., 437, 460).
in the debates upon the adoption of the Constitution? And see the question again considered in Dred Scott vs. Sanford (19 How., 393), as to the
Such a course is to make uncertain the liberties of the people. They rest not in the letter of validity of the Missouri Compromise Act, which prohibited slavery in that part of the
the Constitution, but in judicial interpretation, and the recent cases show that the Louisiana Purchase lying north of 36° 30‘north latitude and not included in the limits of the
members of our highest courts are unable to agree as to what they are or when they are State of Missouri.
available to the protection of the people. See especially dissenting opinions of McLean, J., and Curtis, J., as to when does territory
Why make a difference between these prohibitions upon the power of Congress by stating become so far incorporated, to use the language of the concurring opinion in the Hawaiian
that some protect natural rights and some only methods of procedure? case, as to make these provisions , of the Constitution applicable. It was conceded by all
that the act of April 30, 1900, was effectual for that purpose.
 14

Tried by this test, the acts of the President, of the Commission, and of Congress of July 1, United States, 156 U.S., 51, 87, 175; United States vs. Ball, 163 U.S., 662, 669, 671; Ex
1902, prevented double jeopardy and tried by any of the tests proposed by any parte ‘Lange, 18 Wall., 163; Berkowitz vs. United States, 93 Fed. Rep.,

673 674

VOL. 11, MAY 31, 1904 674 673 PHILIPPINE REPORTS ANNOTATED

KEPNER VS. UNITED STATES. KEPNER VS. UNITED STATES.

of the variant opinions in the cases cited, the contention of the plaintiff in error must be 452, and other cases cited by the Government, distinguished. And see also In re Belt, 159
sustained. U.S., 95, 98; Ex parte Mason, 105 U.S., 696, 699; Murphy vs. Massachusetts, 177 U.S., 155;
Kohlheimer vs. State, 39 Mississippi, 548; State vs. Ward, 48 Arkansas, 36; Black vs. State,
And see also the Spooner resolution of March 2, 1901, which constituted full authority to 36 Georgia, 447; Hilands vs. Commonwealth, 111 Pa. St, 1; State vs. McKee, 1 Bailey Law,
the President to extend the Constitution, and perhaps such portions of it as he might deem 651; S.C., 21 Am. Dec., 499, with notes; Commonwealth vs. Fitzpatrick, 121 Pa. St., 109;
advisable, to the Philippine Islands; and, as we have seen, he did extend the provision McDonald vs. State, 79 Wisconsin, 651; O’Brian vs. Commonwealth, 9 Bush, 333; Durham
forbidding that a person should be twice put in jeopardy for the same offense. The vs. State, 4 Scam., 172; People vs. Miner, 144 111., 308.)
conclusion follows that when the Congress has given a broad letter of attorney to the
President, making him the judge of what is necessary to govern the Philippines, and he These cases show that while there is not a unanimity of decision as to the precise moment
extends the Constitution in whole or in part, it is the act of his principal. when jeopardy attaches, there is substantial unanimity that where the indictment or
information is sufficient, and the defendant is acquitted in a court having jurisdiction, he
All of the acts relating to criminal trial were prior to the commission of the offense for can not be called upon to again answer for the same offense.
which the plaintiff in error was submitted to a double jeopardy, except the act of Congress
and that act was prior to his second trial. Mr. Lebbeus R. Wilfley, Attorney-General for the Philippine Islands, for the United States in
this case and in Nos. 583 and 584.
Have not all these provisions extended this prohibition of the Constitution to the Philippine
Islands? If they have not, what would be effective for that purpose? Plaintiff in error, a member of the Manila bar, was tried by the Court of First Instance of
the city of Manila in November, 1901, on the charge of estafa (embezzlement of the funds
The court will note that the right of appeal by the United States is predicated wholly upon of a client) and acquitted.
General Orders, No. 58, issued by the military commander under date April 23, 1900. It is
submitted that this can not override an order of the President taking effect at a later date Under the law now in force in the Philippine Islands, which gives the Government as well as
and looking to the restoration of the ordinary civil and criminal jurisdiction of the courts of the accused the right of appeal from final judgments of the Courts of First Instance in
this country, and that the language used by the President and Congress must be held to criminal cases, the Government appealed the case and the Supreme Court reversed the
have been used with its accepted meaning in this country. It seems certain, that as against judgment of the lower court, sentencing the plaintiff in error to one year, eight months and
the liberty of the citizen, this court is not authorized to deny to the language thus used by twenty-one days ’imprisonment, together with suspension from the office of attorney at
the executive and legislative branches of the Government its ordinary acceptation. law.

Two trials in a criminal case are not consistent with the prohibition against double The plaintiff in error contends that the right to trial by jury is in the Philippine Islands. The
jeopardy in the Federal Constitution. (United States vs. Sanges, 144 U.S., 310; Sparf vs. court has held in the Insular cases and in the case of Hawaii vs. Mankichi that the
 15

Constitution does not of its own force attach to newly acquired territory immediately upon 676
the date of
676 PHILIPPINE REPORTS ANNOTATED
675
KEPNER VS. UNITED STATES.
VOL. 11, MAY 31, 1904 675

KEPNER VS. UNITED STATES.

Philippine Islands and the laws in force there on thesubject of criminal procedure, and to
have legislated withspecial reference thereto.

acquisition; that power to extend the provisions of the Constitution to the Territories rests The system of trial by jury has been withheld from the Philippines by Congress.
in Congress; that notwithstanding the fact that there are certain prohibitions contained in
the Constitution relating to fundamental rights which go to the very root of the power of Hence Congress can not be presumed, by the use of ’general terms, to have engrafted on
Congress to act, at all times, in all places, and under all circumstances, yet there are other the Roman law system of trial by judges an application of the treaty against double
limitations contained in that instrument, not absolute in their nature, relating to such jeopardy which is connected inseparably with the common law system of trial by jury. This
matters as methods of procedure and forms of judicial trials, which do not restrict could only be done by express, specific provision repealing unmistakably the law of
Congress in the exercise of its power to create local governments and make needful rules procedure in force in the islands at the date of the passage of the act.
and regulations for the Territories of the United States. The adoption by Congress of the Spanish law application of the principle against double
The power of Congress to provide such modes of trial and methods of procedure as in its jeopardy is not in derogation of any fundamental right guaranteed by the Constitution of
judgment are best adapted to the needs of the people of the Territory is clearly recognized the United States, does not violate any principle of natural justice, and is not inconsistent
in the foregoing cases. with the universal principle of jurisprudence which enforces the conclusiveness of a final
and valid judgment.
The sole question raised in this case, in our opinion, is whether the provision of the Code of
Criminal Procedure now in force in the Philippine Islands, which gives the Government, as All rules of statutory construction support the interpretation herein contended for.
well as the accused, the right of appeal from judgments of the trial court in criminal cases, Mr. Solicitor-General Hoyt for the United States in this case and in Nos. 583 and 584:
is repealed by the act of Congress of July 1, 1902, entitled “An Act temporarily to provide
for the administration of the affairs of civil government in the Philippine Islands, and for The first question here is whether the express limitations respecting trial by jury apply of
other purposes,” which provides that no person “for the same offense shall be twice put in their own force in the Philippines as a vital and inherent principle of our free government
jeopardy of punishment.” everywhere, or whether they constitute simply a remedial right and a particular method of
procedure peculiar to our Anglo-Saxon jurisprudence, but not essential to the protection of
General Orders, No. 58, is not repealed by said act of Congress because the clause giving individual liberty.
the Government the right of trial ‘in government cases does not violate the provision
against double jeopardy contained in said act. The principle of law against double jeopardy This question was answered in the Mankichi case (190 U.S., 197). From that decision it
exists in the Spanish as it does in the common law countries. The proceeding before the seems clear that while most of the privileges and immunities of the bill of rights apply to
court of the first instance and the Supreme Court of the Philippine Islands are but parts of Territories from the moment of acquisition, trial by jury does not. That institution is not a
a single continuous trial. Congress in enacting this piece of special legislation, must be necessary and fundamental right, but concerns procedure mainly, and the guarantee does
supposed to have had in view the conditions and circumstances existing in the not apply to newly acquired territory. Trial by jury was entirely unknown to the civil law in
 16

677 678

VOL. 11, MAY 31, 1904 678 677 PHILIPPINE REPORTS ANNOTATED

KEPNER VS. UNITED STATES. KEPNER VS. UNITED STATES.

general and as administered in the Philippines, and the civil law method of trial has always conditions? What was the intention of Congress? The principle is ancient and inherent in
been in vogue there, is familiar to the people and is perfectly adequate to all the demands all just laws, and in some sense is a fundamental limitation on our Government
of justice. everywhere. It is evident, however, that the scope and effect of our rules are essentially
dependent upon the peculiar function and conclusive authority of a jury. The finality of a
The respect which we are bound to feel for the institutions of the civil law, and the idea verdict against the prosecution rules the whole subject.
that the rights of new people coming under our sovereignty should not be unnecessarily
interfered with in respect to their historical institutions and jurisprudence, have been Under the system we found in the Philippines all serious crimes were necessarily reviewed
expressed by the court in opinions of great ability and force. (Hurtado vs. California, 110 by the audiencia, whether acquittal or conviction resulted below, and the case was not
U.S., 516; Holden vs. Hardy, 169 U.S., 366.) final, the trial ended and the jeopardy complete until the audiencia had pronounced
judgment. The American legislation has made no substantial changes in these
Previous cases involving the question as to the right of trial by jury establish these proceedings. Under the present system there is not more than one trial; the original trial is
propositions: that the first eight amendments to the Constitution do not operate upon the a unitary and continuous thing and is not complete until the appellate court has
States; that accordingly, while jury trial is a necessary rule in courts of the United States, pronounced judgment.
including the District of Columbia and the organized Territories, nevertheless the State
may provide for other modes of accusation and trial consistently with due process of law Congress has manifested a clear intention to approve and sustain the established scheme
and the principles of free government. (Webster vs. Reid, 11 How., 437; Hurtado vs. as modified and enlarged under our authority; the Philippine situation was studied with
California, 110 U.S., 516; In re Ross, 140 U.S., 473; American Pub. Co. vs. Fisher, 166 U.S., particular care and great deliberation, and Congress acted upon full information. It is
46; Thompson vs. Utah, 170 U.S., 343; Bolln vs. Nebraska, 176 U.S., 83; Maxwell vs. Dow, incredible that Congress meant to impose the peculiar conception and effect of the rule on
176 U.S., 584; Downes vs. Bidwell, 182 U.S., 244.) The Mankichi case and the present cases jeopardy which is imbedded in our law simply because of its relation to trial by jury. If that
add to this rule Territories not organized. view were sustained, such mischiefs and confusion would follow as those which would be
consequent upon the immediate introduction of grand and petit juries. It was never
The power of Congress here is plenary. Congress has exercised it by maintaining all the intended, by the insertion of the jeopardy clause to wipe out by mere remote implication
guarantees vital and necessary to free government which our war power had imposed the entire established course of state appeals in criminal cases. If Congress had desired to
upon itself at the outset. Congress has not only not extended the Constitution and laws in give to our Government in the Philippines the authority to strike down appeals by the
general of the United States, but has affirmatively withheld them, and intentionally has prosecution in criminal cases, they would have done so in clear and unmistakable
not included trial by jury in the bill of rights conferred. Under these circumstances, and language.
under the decisions as interpreted and applied by the Insular cases, the Iogic is certain and
inevitable that the right of trial by jury does not apply to the Philippine Islands. There is due process of law in the Philippines within our own fundamental guarantees and
by our own tests. The system is sufficient for the full demands of distributive justice. The
What does the provision as to jeopardy in the Philippine civil government act mean as law is equal and operates upon all alike.
applied to Philippine
679
 17

VOL. 11, MAY 31, 1904 680 679 PHILIPPINE REPORTS ANNOTATED

KEPNER VS. UNITED STATES. KEPNER VS. UNITED STATES.

It ‘is as right for this Government to preserve the essential character of the structure as a the jurisdiction of the courts in which the accused was tried was established.
possession and cherished institution of the inhabitants, as it is for a State to adopt just
such institutions upon the desires and demands of its people. See Missouri vs. Lewis (101 The United States acquired the Philippine Islands by cession under the treaty of peace
U.S., 22, 31). executed at Paris, between the United States and Spain, on December 10, 1898, the final
ratifications being exchanged April 11, 1899.
The Philippine laws respecting criminal trials and appeals are entirely harmonious with the
necessary principles of free government, and all the proceedings taken herein were due The islands after American occupation had been under military rule prior to the creation of
and legal and were not forbidden by the Constitution and laws of the United States. Mr. the Philippine Commission.
Justice DAY delivered the opinion of the court: Under the control of the military government, orders had been issued, among others,
Thomas E. Kepner, a practicing lawyer in the city of Manila, Philippine Islands, was Military Order Number 58, dated April 23, 1900, which order was in part as follows:
charged with a violation of the law in the embezzlement of the funds of his client (estafa). “GENERAL ORDERS, No. 58.
Upon trial, in November, 1901, in the Court of First Instance, without a jury, he was
acquitted, it ,being the judgment of the court that he was not guilty of the offense “MANILA, P.I., April 23, 1900.
charged. Upon appellate proceedings by the United States to the Supreme Court of the
Philippine Islands the judgment of the Court of First Instance, finding the accused not “In the interests of justice and to safeguard the civil liberties of the inhabitants of these
guilty, was reversed, and Kepner was found guilty and sentenced to a term of islands, the criminal code of procedure now in force therein is hereby amended in certain
imprisonment of one year, eight months and twenty-one days, suspended from any public of its important provisions as indicated in the following enumerated sections:
office or place of trust and deprived of the right of suffrage. * * * * * * *
Error was assigned in the appellate court upon the ground that the accused had been put “SEC. 3. All public offenses triable in Courts of First Instance or in courts of similar
in jeopardy a second time by the appellate proceedings, in violation of the law against jurisdiction, now established or that hereafter may be established, must be prosecuted by
putting a person twice in jeopardy for the same offense, and contrary to the Constitution complaint or information.
of the United States.
* * * * * * *
The appeal was taken by the United States on December 20, 1901. A motion to dismiss the
appeal was made on January 1, 1902. The motion was finally overruled on October 11, “RIGHTS OF ACCUSED AT THE TRIAL.
1902; the final decision in the case, finding the accused guilty and imposing the sentence,
was rendered on December 3. 1902. “SEC. 15. In all criminal prosecutions the defendant shall be entitled:

A proper consideration of the question herein made renders it necessary to notice some of “To appear and defend in person and by counsel at every stage of the proceedings.
the steps by which
1. “2.
680 To be informed of the nature and cause of the accusation.
 18

2. “3. law. The United States may also appeal from a judgment for the defendant rendered on a
To testify as a witness in his own behalf; but if a defendant offers himself as a demurrer to an information or complaint, and from an order dismissing a complaint or
witness he may be crossexamined as any other witness. His neglect or refusal to information.
be a witness shall not in any manner prejudice or be used against him.
* * * * * *
681
“SEC. 50. It shall not be necessary to forward to the Supreme Court the record, or any part
VOL. 11, MAY 31, 1904 thereof, of681
any case in which there shall have been an acquittal, or in which the sentence
imposed does not exceed confinement in prison for one year, or a fine of 250 pesos,
KEPNER VS. UNITED STATES. exclusive of costs, unless such case shall have been duly appealed. But such sentences shall
be executed upon the order of the court in which the trial was had. The record in cases in
1.
which the death penalty, or imprisonment exceeding one year, or a fine exceeding two
2. “4. hundred fifty pesos, exclusive of costs of trial, shall have been imposed, shall be forwarded
To be exempt from testifying against himself. to the clerk of the criminal branch of the

3. “5. 682
To be confronted at the trial by and to cross-examine the witnesses against him.
682 PHILIPPINE REPORTS ANNOTATED
Where the testimony of a witness for the prosecution has previously been taken
down by question and answers in the presence of the accused or his counsel, the KEPNER VS. UNITED STATES.
defense having had an opportunity to cross-examine the witness, the deposition
of the latter may be read, upon satisfactory proof to the court that he is dead or
insane, or can not with due diligence be found in the islands.
Supreme Court within twenty days, but not earlier than fifteen days after the rendition of
4. “6. the sentence. All cases involving sentence of death, or of imprisonment exceeding six
To have compulsory process issue for obtaining witnesses in his own favor. years, or of fine exceeding one thousand two hundred fifty pesos, or in which an -appeal
shall have been taken, shall be submitted to the criminal branch. of the Supreme Court,
5. “7. and shall thereafter take the same course as is now provided by law. Cases forwarded to
To have a speedy and public trial. the Supreme Court involving sentences less serious than those hereinbefore last
6. “8. mentioned, and not appealed, shall be referred by the clerk to the ministerio fiscal for
To have the right of appeal in all cases. consideration, and if the latter return the same concurring in the sentence imposed, the
record shall immediately be returned to the trial court for execution of sentence. If the
* * * * * * ministerio fiscal shall not concur in the sentence the case shall be submitted to the criminal
branch of the Supreme Court, and shall thereafter take the same course as is now provided
“SEC. 43. From all final judgments of the Courts of First Instance or courts of similar by law when that officer shall recommend a sentence in any respect more severe than that
jurisdiction, and in all cases in which the law now provides for appeals from said courts an imposed by the trial judge, and for the consideration of the court, without the necessity of
appeal may be taken to the Supreme Court as hereinafter prescribed. * * * a further defense or hearing, when that officer recommends a lighter sentence.”
“SEC. 44. Either party may appeal from a final judgment or from an order made after This order was amended by an act of the Commission (No. 194), passed August 10, 1901,
judgment affecting the substantial rights of the appellant or in any case now permitted by and is as follows: "(G) No. 194.—An Act conferring jurisdiction on justices of the peace, etc.
 19

“SEC. 1. Every justice of the peace in the Philippine Islands is hereby invested with 2. “2.
authority to make preliminary investigation of any crime alleged to have been committed Appellate.
within his municipality, jurisdiction to hear and determine which is by law now vested in
the judges of Courts of First Instance. * * * “SEC. 17. The Supreme Court shall have original jurisdiction to issue writs of mandamus,
certiorari, prohibition, habeas corpus and quo warranto in the cases and in the manner
“SEC. 4. So much of section fifty of said General Order Number Fifty-eight as requires prescribed in the Code of Civil Procedure, and to hear and determine the controversies thus
Courts of First Instance, or clerks thereof, to forward to the Supreme Court or the brought before it, and in other cases provided by law.
ministerio fiscal the record of all criminal cases for revision or consideration, except where
the death penalty is imposed as the judgment or part of the judgment of such Court of First “SEC. 18. The Supreme Court shall have appellate jurisdiction of all actions and special
Instance, is hereby repealed, and it shall proceedings properly brought to it from Courts of First Instance, and from other tribunals
from whose judgment the law shall specially provide an appeal to the Supreme Court.
683
“SEC: 19. The Supreme Court shall have power to issue writs of certiorari and all other
VOL. 11, MAY 31, 1904 auxiliary writs
683and process necessary to the complete exercise of its original or appellate
jurisdiction.
KEPNER VS. UNITED STATES.
684

684 PHILIPPINE REPORTS ANNOTATED

not be necessary to forward to the Supreme Court or the ministerio fiscal the record, or
any part thereof, of any case in which there shall have been an acquittal, or in which the KEPNER VS. UNITED STATES.
penalty imposed is not death, unless such case shall have been duly appealed, as provided
in such order. The records of all cases in which the death penalty shall have been imposed
by any Court of First Instance, whether the defendant shall have appealed or not, shall be “SEC. 39. The existing audiencia or Supreme Court is hereby abolished, and the Supreme
forwarded to the Supreme Court for investigation and judgment, as law and justice shall Court provided by this act is substituted in place thereof.
dictate.”
* * * * * * *
Courts were established for the Islands under an act passed by the Commission June 11,
1901: “SEC. 55. The jurisdiction of Courts of First Instance shall be of two kinds:

“SEC. 2. The judicial power of the Government of the Philippine Islands shall be vested in a 1. “1.
Supreme Court, Courts of First Instance, and courts of justices of the peace, together with Original; and
such special jurisdictions of municipal courts, and other special tribunals as now are or
hereafter may be authorized by law. The two courts first named shall be courts of record. 2. “2.
Appellate.
“SEC. 16. The jurisdiction of the Supreme Court shall be of two kinds:
“SEC. 56. Courts of First Instance shall have original jurisdiction. * * * 6. In all criminal
1. “1. cases in which a penalty of more than six months ’imprisonment or a fine exceeding one
Original; and hundred dollars may be imposed.

* * * * * * *
 20

“SEC. 65. The existing Courts of First Instance are hereby abolished, and the Courts of First powers of government to the extent and in the manner and form and subject to the
Instance provided by this act are substituted in place thereof. regulation and control set forth in the instructions of the President to the Philippine
Commission, dated April seventh, nineteen hundred, and in creating the offices of Civil
“SEC. 66. There shall be courts of justice of the peace as in this section provided: Governor and Vice-Governor of the Philippine Islands, and authorizing said Civil Governor
1. “1. and Vice-Governor to exercise the powers of government to the extent and in the manner
The existing courts of justices of the peace, established by military orders since and form set forth in the executive order dated June twenty-first, nineteen hundred and
the thirteenth day of August, eighteen hundred and ninety-eight, are hereby one, and in establishing four executive departments of government in said Islands as set
recognized and continued, and the justices of such courts shall continue to hold forth in the act of the Philippine Commission, entitled ‘An act providing an organization for
office during the pleasure of the Commission. the Departments of the Interior, of Commerce and Police, of Finance and Justice, and of
Public Instruction, ’enacted September sixth, nineteen hundred and one, is hereby
2. “2. approved, ratified, and confirmed, and until otherwise provided by law the said Islands
In every province in which there now is, or shall hereafter be established, a Court shall continue to be governed as thereby and herein provided, and all laws passed
of First Instance, courts of justice of the peace shall be established in every hereafter by the Philippine Commission shall have an enacting clause as follows: ‘By
municipality thereof which shall be organized under the Municipal Code, or authority of the United States be it enacted by the Philippine Commission. ’The provisions
which has been organized and is being conducted as a municipality when this act of section eighteen hundred and ninety-one of the Revised Statutes of eighteen hundred
shall take effect, under and by virtue of the Municipal Code. and seventy-eight shall not apply to the Philippine Islands.

* * * * * * * “Future appointments of Civil Governor, Vice-Governor, members of said Commission, and

heads of executive departments shall be made by the President, by and with the advice
“SEC. 68. A justice of the peace shall have original jurisdiction for the trial of all and consent of the Senate.
misdemeanors and offenses arising within the municipality of which he is a justice, in all
cases where the sentence might not by law ex-ceed six months ’imprisonment or a fine of 686
one hundred dollars; * * *."
686 PHILIPPINE REPORTS ANNOTATED
685
KEPNER VS. UNITED STATES.
VOL. 11, MAY 31, 1904 685

KEPNER VS. UNITED STATES.

“SEC. 5. That no law shall be enacted in said Islands which shall deprive any person of life,
liberty or property without due process of law, or deny to any person therein the equal
protection of the laws.
On July 1, 1902, Congress passed an act, 32 Stat, 091:
“That in all criminal prosecutions the accused shall enjoy the right to be heard by himself
“An Act temporarily to provide for the administration of the affairs of civil government in and counsel, to demand the nature and cause of the accusation against him, to have a
the Philippine Islands, and for other purposes. speedy and public trial, to meet the witnesses face to face, and to have compulsory
“Be it enacted ‘by the Senate and House of Representatives of the United States of process to compel the attendance of witnesses in his behalf.
America in Congress assembled, That the action of the President of the United States in
creating the Philippine Commission and authorizing said Commission to exercise the
 21

“That no person shall be held to answer for a criminal offense without due process of law; “That no law shall be passed abridging the freedom of speech or of the press, or the right
and no person for the same offense shall be twice put in jeopardy or punishment, nor shall of the people peaceably to assemble and petition the Government for redress of
be compelled in any criminal case to be a witness against himself. grievances.

“That all persons shall before conviction be bailable by sufficient sureties, except for “That no law shall be made respecting an establishment of religion or prohibiting the free
capital offenses. exercise thereof, and that the free exercise and enjoyment of religious profession and
worship, without discrimination or preference, shall forever be allowed.
“That no law impairing the obligation of contracts shall be enacted.
“That no money shall be paid out of the treasury except in pursuance of an appropriation
“That no person shall be imprisoned for debt. by law.
“That the privilege of the writ of habeas corpus shall not be suspended, unless when in “That the rule of taxation in said Islands shall be uniform.
cases of rebellion, insurrection or invasion the public safety may require it, in either of
which events the same may be suspended by the President, or by the Governor, with the “That no private or local bill which may be enacted into law shall embrace more than one
approval of the Philippine Commission, whenever during such period the necessity for such subject, and that subject shall be expressed in the title of the bill.
suspension shall exist.
“That no warrant shall issue but upon probable cause, supported by oath or affirmation,
“That no ex post facto law or bill of attainder shall be enacted. and particularly describing the place to be searched and the person or things to be seized.

“That no law granting a title of nobility shall be enacted, and no person holding any office “That all money collected on any tax levied or assessed for a special purpose shall be
of profit or trust in said islands shall, without the consent of the Congress of the United treated as a special fund in the treasury and paid out for such purpose only.
States, accept any present, emolument, office or title of any kind whatever from any king,
queen, prince or foreign State. * * * * * * *

“That excessive bail shall not be required, nor excessive fines imposed, nor cruel and “SEC. 9. That the Supreme Court and the Courts of First Instance of the Philippine Islands
unusual punishment inflicted. shall possess and exercise jurisdiction as heretofore provided, and such additional
jurisdiction as shall hereafter be prescribed by the Government of said Islands, subject to
“That the right to be secure against unreasonable searches and seizures shall not be the power of said Government to change the practice and method of procedure. The
violated. municipal courts of said Islands shall possess and exercise jurisdiction as heretofore
provided by the Philippine Commission, subject in all matters to such. alteration and
“That neither slavery nor involuntary servitude, except amendment as may be hereafter enacted by law; and the chief justice and associate
687 justices of the Supreme Court shall hereafter be appointed by the President, by and with
the advice and consent of the Senate,
VOL. 11, MAY 31, 1904 687
688
KEPNER VS. UNITED STATES.
688 PHILIPPINE REPORTS ANNOTATED

KEPNER VS. UNITED STATES.

as a punishment for crime whereof the party shall have been duly convicted, shall exist in
said Islands.
 22

and shall receive the compensation heretofore prescribed by the Commission until The citations in the brief of the learned counsel for the Government seem to establish that
otherwise provided by Congress. The judges of the Court of First Instance shall be under the Spanish law, as theretofore administered, one who had been convicted by a
appointed by the Civil Governor, by and with the advice and consent of the Philippine judgment of the court of last resort could not again be prosecuted for the same offense.
Commission: Provided, That the admiralty jurisdiction of the Supreme Court and courts of We notice some of these provisions:
First Instance shall not be changed except by act of Congress.
In Spanish law the doctrine found expression in the Fuero Real (A. D. 1255) and the Siete
“SEC. 10. That the Supreme Court of the United States shall have jurisdiction to review, Partidas (A. D. 1263).
revise, reverse, modify or affirm the final judgments and decrees of the Supreme Court of
the Philippine Islands in all actions, cases, causes and proceedings now pending therein or “After a man, accused of any crime, has been acquitted by the court, no one can
hereafter determined thereby in which the Constitution or any statute, treaty, title, right or afterwards accuse him of the same offense (except in certain specified cases). (Fuero Real,
privilege of the United States is involved, or in causes in which the value in controversy lib. iv, tit. xxi, 1, 13.1)
exceeds twenty-five thousand dollars, or in which the title or possession of real estate “If a man is acquitted by a valid judgment of any offense of which he has been accused, no
exceeding in value the sum of twenty-five thousand dollars, to be ascertained by the oath other person can afterwards accuse him of the offense (except in certain cases). (Siete
of either party or of other competent witnesses, is involved or brought in question; and Partidas, Part. VII, tit. i, 1. xii.)"
such final judgments or decrees may and can be reviewed, revised, reversed, modified or
affirmed by said Supreme Court of the United States on appeal or writ of error by the party In the encyclopedia of Spanish law, published by Don Lorenzo Arrazola in 1848, it is said, in
aggrieved, in the same manner, under the same regulations, and by the same procedure, considering the persons who may be accused of crime:
as far as applicable, as the final judgments and decrees of the Circuit Courts of the United
States.” “It is another of the general exceptions that a person can not be accused who has formerly
been accused and adjudged of the same crime, since the most essential effect of all judicial
The Act just quoted became a law before the final conviction of the accused in the decisions upon which execution can issue is to constitute unalterable law. (Tomo I, pag.
Supreme Court of the Islands. It is contended by the Government that that part of the law 511.)"
under immediate consideration, which provides that no person, for the same offense, shall
be twice put in jeopardy, must be construed in view of the system of laws prevailing in the Under that system of law it- seems that a person was not regarded as being in jeopardy in
Islands before the same were ceded to the United States, and that the purpose of Congress the legal sense until there had been a final judgment in the court of last resort. The lower
was to make effectual the jurisprudence of the Islands as known and established before courts were deemed examining courts, having preliminary jurisdiction, and the accused
American occupation, and that the provision against double jeopardy must be read in the was not finally convicted or acquitted until the case had been passed upon in the
audiencia, or Supreme Court, whose judgment was subject to review in the Supreme Court
689 at Madrid for errors of law, with power to grant a new trial. The trial was regarded as one
continuous proceeding, and the protection given was against a second conviction after this
VOL. 11, MAY 31, 1904 689
_______________
KEPNER VS. UNITED STATES.
1 Tit. XX 1. 13.

690
light of the understanding of that expression in the civil law, or rather the Spanish law as it
was then in force. 690 PHILIPPINE REPORTS ANNOTATED
 23

KEPNER VS. UNITED STATES. KEPNER VS. UNITED STATES,

final trial had been concluded in due form of law. The change introduced under Military understand, that there are certain great principles of government which have been made
Order, No. 58, as amended by Act 194 of the Commission, made -the judgment of the the basis of our governmental system, which we deem essential to the rule of law and the
Court of First Instance final, in cases other than capital, whether the accused be convicted maintenance of individual freedom, and of which they have, unfortunately, been denied
or acquitted, unless an appeal was prosecuted by the Government or the accused in the the experience possessed by us; that there are also certain practical rules of government
manner pointed out. which we have found to be essential to the preservation of these great principles of liberty
and law, and that these principles and these rules of government must be established and
In order to determine what Congress meant in the language used in the act under maintained in their Islands for the sake of their liberty and happiness, however much they
consideration, “No person for the same offense shall be twice put in jeopardy of may conflict with the customs or laws of procedure with which they are familiar. It is
punishment,” we must look to the origin and source of the expression and the judicial evident that the most enlightened thought of the Philippine Islands fully appreciates the
construction put upon it before the enactment in question was passed. A consideration of importance of these principles and rules, and they will inevitably within a short time
the events preceding this regulation makes evident the intention of Congress to carry some command universal assent. Upon every division and branch of the Government of the
at least of the essential principles of American constitutional jurisprudence to these Islands Philippines, therefore, must be imposed these inviolable rules:
and to engraft them upon the law of this people, newly subject to our jurisdiction.
“That no person shall be deprived of life, liberty or property without due process of law;
That it was the intention of the President in the instructions to the Philippine Commission that private property shall not be taken for public use without just compensation;. that in
to adopt a wellknown part of the fundamental law of the United States, and to give much all criminal prosecutions the accused shall enjoy the right to a speedy and public trial, to be
of the beneficent protection of the bill of rights to the people of the Philippine Islands, is informed of the nature and cause of the accusation, to be confronted with the witnesses
not left to inference, for in his instructions, dated April 7, 1900 (see Public Laws and against him, to have compulsory process for obtaining witnesses in his favor, and to have
Resolutions of Philippine Com. 6–9), he says: the assistance of counsel for his defense; that excessive bail shall not be required, nor
“In all the forms of government and administrative provisions which they are authorized to excessive fines imposed, nor cruel and unusual punishment inflicted; that no person shall
prescribe, the Commission should bear in mind that the government which they are be put twice in jeopardy for the same offense or be compelled in any criminal case to be a
establishing is designed not for our satisfaction or for the expression of our theoretical witness against himself; that the right to be secure against unreasonable searches and
views, but for the happiness, peace and prosperity of the people of the Philippine Islands, seizures shall not be violated; that neither slavery nor involuntary servitude shall exist
and the measures adopted should be made to conform to their customs, their habits, and except as a punishment for crime; that no bill of attainder or ex post facto law shall be
even their prejudices, to the fullest extent consistent with the accomplishment of the passed; that no law shall be passed abridging the freedom of speech or of the press or of
indispensable requisites of just and effective government;” the of the people to peaceably assemble and petition the government for a redress of
grievances; that
But he was careful to add:
692
“At the same time the Commission should bear in mind, and the people of the Islands
should be made plainly to 692 PHILIPPINE REPORTS ANNOTATED

691 KEPNER VS. UNITED STATES.

VOL. 11, MAY 31, 1904 691

 24

no law shall be made respecting an establishment of religion or prohibiting the free It is a well-settled rule of construction that language used in a statute which has a settled
exercise thereof, and that the free exercise and enjoyment of religious profession and and well-known meaning, sanctioned by judicial decision, is presumed to be used in that
worship without discrimination or preference shall forever be allowed.” sense by the legislative body,. (The Abbotsford, 98 U.S., 440.)

These words are not strange to the American lawyer or student of constitutional history. It is not necessary to determine in this case whether the jeopardy provision in the Bill of
They are the familiar language of the Bill of Rights, slightly changed in form, but not in Rights would have become part of the law of the Islands without Congressional legislation.
substance, as found in the first nine amendments to the Constitution of the United States, The power of Congress to make rules and regulations for territory incorporated in or
with the omission of the provision preserving the right to trial by jury and the right of the owned by the United States is settled by an unbroken line of decisions of this court and is
people to bear arms, and adding the prohibition of the thirteenth amendment against no longer open to question. (American Ins. Co. vs. Canter, 1 Pet, 511; Murphy vs. Ramsey,
slavery or involuntary servitude except as a punishment for crime, and that of article 1, 114 U.S., 15; Mormon Church vs. United States, 136 U.S., 1, 42, 43; Downes vs. Bidwell,
section 9, to the passage of bills of attainder and ex post facto laws. These principles were 182 U.S., 244; Hawaii vs. Mankichi, 190 U.S., 197.) This case does not call for a discussion
not taken from the Spanish law; they were carefully collated from our own Constitution, of the limitations of such power, nor require determination of the question whether the
and embody almost verbatim the safeguards of that instrument for the protection of life jeopardy clause became the law of the Islands after the ratification of the treaty without
and liberty. Congressional action, as the act of Congress made it the law of these possessions when the
accused was tried and convicted.
When Congress came to pass the act of July 1, 1902, it enacted, almost in the language of
the President’s instructions, the Bill of Rights of our Constitution. In view of the expressed It is argued that in the Act of July 1, 1902, Congress recognized the jurisdiction of the
declaration of the President, followed by the action of Congress, both adopting, with little Philippine courts in section 9 as follows:
alteration, the provisions of the Bill of Rights, there would seem to be no room for
argument that in this form it was intended to carry to the Philippine Islands those “SEC. 9. That the Supreme Court and the Courts of First Instance of the Philippine Islands
principles of our Government which the President declared to be established as rules of shall possess and exercise jurisdiction as heretofore provided, and such additional
law for the maintenance of individual freedom, at the same time expressing regret that jurisdiction as shall hereafter be prescribed by the Govermnent of said Islands, subject to
the inhabitants of the Islands had not theretofore enjoyed their benefit. the power of said Government to change the practice and method of procedure.”

How can it be successfully maintained that these expressions of fundamental rights, which The argument is, that Congress intended to leave the right of appeal as provided by
have been the subject of frequent adjudication in the courts of this country, and the Military Order, No. 58, as amended by the Commission, in full force.
maintenance of which has been ever deemed essential to our Government, could be used But Congress, in section 5, had already specifically provided that no person should be put
by Congress in any other sense than that which has been placed upon them in construing twice in jeopardy of punishment for the same offense. While section 9 recognizes the
the instrument from which they were taken? established jurisdiction of the courts of the Islands, it was not intended to repeal the
693 specific

VOL. 11, MAY 31, 1904 694 693

694 PHILIPPINE REPORTS ANNOTATED
KEPNER VS. UNITED STATES.
KEPNER VS. UNITED STATES.
 25

guaranty of section 5, which is direct legislation pertaining to the particular subject. It is a diction of the cause, he may by the common law, in all ’cases, plead such acquittal in bar
well-settled principle of construction that specific terms covering the given subject matter of any subsequent indictment or appeal for the same crime.”
will prevail over general language of the same or another statute which might otherwise
prove controlling. (In re Rouse, Hazard & Co., 91 Fed. Rep., 96, 100, and cases therein In this court it was said by Mr. Justice Miller, in Ex parte Lange (18 Wall., 163) :
cited; Townsend vs. Little, 109 U'. S., 504, 512.) “The common law not only prohibited a second punishment for the same offense, but went
In ascertaining the meaning of the phrase taken from the Bill of Rights it must be further and forbid a second trial for the same offense, whether the accused had suffered
construed with reference to the common law from which it was taken. 1 Kent, Com., 336; punishment or not, and whether in the former trial he had been acquitted or convicted.”
United States vs. Wong Kim Ark, 169 U.S., 649, in which this court said: And in as late a case as Wemyss vs. Hopkins (L. R., 10 Q.B., 378), it was held that a
“In this, as in other respects, it [a constitutional provision] must be interpreted in the light conviction before a court of competent jurisdiction, even without a jury, was a bar to a
of the common law, the principles and history of which were familiarly known to the second prosecution.
framers of the Constitution. (Minor vs. Happersett, 21 Wall., 162; Ex parte Wilson, 144 In that case the appellant had been summarily convicted before a magistrate for
U.S., 417, 422; Boyd vs. United States, 116 U.S., 616, 624, 625; Smith vs. Alabama, 624 1 negligently and by willful misconduct driving a carriage against a horse ridden by the
U.S., 465.) The language of the Constitution, as has been well said, could not be respondent, and was afterwards convicted on the same facts for unlawful assault. It was
understood without reference to the common law. (1 Kent’s Com., 336; Bradley, J., in held that the first conviction was a bar to the second. In the course of the opinion it was
Moore .vs. United States, 91 U.S., 270, 274.)" said by Blackburn, J.:
At the common law, protection from second jeopardy for the same offense clearly included “I think the fact that the appellant had been convicted by justices under one act of
immunity from second prosecution where the court having jurisdiction had acquitted the Parliament for what amounted to an assault is a bar to a conviction under another act of
accused of the offense. The rule is thus stated by Hawkins in his pleas of the Crown, quoted Parliament for the same assault. The defense does not arise on a plea of autrefois convict,
by Mr. Justice Story in United States vs. Gibert et al. (2 Sumner, 19, 39) : but on the wellestablished rule at common law, that where a person has been convicted
“The plea (says he) of autrefois acquit is grounded on this maxim, that a man shall not be and punished for an offense by a court of competent jurisdiction, transit in rem judicatum,
brought into danger of his life for one and the same offense more than once. From whence that is, the conviction shall be a bar to all further proceedings for the same offense, and he
it is generally taken by all our books, as an undoubted consequence, that where a man is shall not be punished again for the same matter; otherwise there might be two different
once found not guilty, on an indictment or appeal, free from error, and well commenced punishments for the same offense. The only point raised is whether a defense in the nature
before any court, which hath juris- of a plea of autrefois convict would extend to a conviction before two justices whose
jurisdiction is created by statute. I think the fact that the jurisdiction of the justices is
_______________ created by statute makes no difference. Where the conviction is by a court of competent
jurisdiction it matters not whether
1 124.
696
695
696 PHILIPPINE REPORTS ANNOTATED
VOL. 11, MAY 31, 1904 695
KEPNER VS. UNITED STATES.
KEPNER VS. UNITED STATES.

the conviction is by a summary proceeding before justices or by trial before a jury.”

 26

In the same case it was said by Lush, J.: “I am also of opinion that the second conviction 657, 747; Stark. Crim. Pl. (2d ed.), 357, 367, 371; Archb. Crim. Pl., (12th Eng. and 6th Am.
should be quashed, upon the ground that it violated a fundamental principle of law, that ed.) 177, 199.)
no person shall be prosecuted twice for the same offense. The act charged against the
appellant on the first occasion was an assault upon the respondent while she was riding a “But whatever may have been, or may be, the law of England upon that question, it is
horse on the highway, and it therefore became an offense for which the appellant might settled by an overwhelming weight of American authority, that the State has no right to
be punished under either of two statutes. The appellant was prosecuted for the assault sue out a writ of error. upon a judgment in favor of the defendant in a criminal case,
and convicted under one of the statutes (3 and 4, Wm. IV, c. 50, sec. 78), and fined, and he except under and in accordance with express statutes, whether that judgment was
therefore can not be afterwards convicted again for the same act under the other statute.” rendered upon a verdict of acquittal, or upon the determination by the court of a question
of law.”
It is true that some of the definitions given by the text-book writers, and found in the
reports, limit jeopardy to a second prosecution after verdict by a jury; but the weight of In the course of the opinion Justice Gray cites, among other cases, Com. vs. Commings and
authority, as well as decisions of this court, have sanctioned the rule that a person has Same vs. McGinnis, opinion by Chief Justice Shaw (3 Cush., 212). In Archbold Cr. Pl. & Pr.,
been in jeopardy when he is regularly charged with a crime before a tribunal properly Pomeroy’s ed., 199, it was said: “There is no instance of error being brought upon a
organized and competent to try him, certainly so after acquittal. (Coleman vs. Tennessee, judgment for a defendant after an acquittal.”
97 U.S., 509.) Undoubtedly in those jurisdictions where a trial of one accused of crime can That the learned justice could not have intended to intimate that a second prosecution
only be to a jury, and a verdict Of acquittal or conviction must be by a jury, no legal could be allowed by statute after an acquittal of the offense is shown by the subsequent
jeopardy can attach until a jury has been called and charged with the deliverance of the decision of ‘this court in United States vs. Ball (163 U.S., 662), in which Mr. Justice Gray
accused. But, protection being against a second trial for the same offense, it is obvious also delivered thev opinion of the court. In that case an attempt was made to prosecute for
that where one has been tried before a competent tribunal having jurisdiction he has been the second time one Millard F. Ball, who had been acquitted upon a defective indictment,
in jeopardy as much as he could have been in those tribunals where a jury is alone which had been held bad upon the proceedings in error prosecuted by others jointly
competent to convict or acquit. (People vs. Miner, 144 Illinois, 308; State vs. Bowen, 45 indicted with Millard F. Ball, who had been convicted at the trial. The court below held
Minnesota, 145; State vs.. Layne, 96 Tennessee, 668.) Ball’s plea of former jeopardy to be bad. But this court reversed the judgment, and. in the
In United States vs. Sanges (144 U.S., 310) it was held that a writ of error did not lie in course of the opinion it was said:
favor of the United States in a criminal case, Mr. Justice Gray said: The Constitution of the United States, in the fifth amendment, declares, ‘nor shall any
“From the time of Lord Hale to that of Chadwick’s person be subject to be twice put in jeopardy of life or limb. ’The prohibition

697 698

VOL. 11, MAY 31, 1904 698 697 PHILIPPINE REPORTS ANNOTATED

KEPNER VS. UNITED STATES. KEPNER VS. UNITED STATES.

case, just cited, the text-books”, with hardly an exception, either assume or assert that the is not against being twice punished, but against being twice put in jeopardy; and the
defendant (or his representative) is the only party who can have either a new trial or a writ accused, whether convicted or acquitted, is equally put in jeopardy at the first trial. An
of error in a criminal case; and that a judgment in his favor is final and conclusive. (See 2 acquittal before a court having no jurisdiction is, of course, like all the proceedings in the
Hawk., c. 47, see. 12; c. 50, secs. 10 et seq.; Bac. Ab. Trial, L. 9; Error, B; 1 Chit. Crim. Law, case, absolutely void, and therefore no bar to subsequent indictment and trial in a court
 27

which has jurisdiction of the offense. (Commonwealth vs. Peters, 12 Met., 387; 2 Hawk., Bishop, in his work upon Criminal Law, sums up the scope and authority of such statutes as
P.C., c. 35, sec. 3; 1 Bishop’s Crim. Law, sec. 1028.) But although the indictment was fatally f follows:
defective, yet, if the court had jurisdiction of the cause and of the party, its judgment is not
void, but only voidable by writ of error; and, until so avoided, can not be collaterally “A legislative provision for the rehearing of criminal causes can not be interpreted—or, at
impeached, If the judgment is upon a verdict of guilty, and unre-versed, it stands good and least, it can not have force—to violate the constitutional rule under consideration,
warrants the punishment of the defendant accordingly, and he could not be discharged by whatever be the words in which the provision is expressed. When, therefore, a defendant
a writ of habeas corpus. (Ex parte Parks, 93 U.S., 18.) If the judgment is upon an acquittal, has been once in jeopardy, the jeopardy can not be repeated without his consent,
the defendant. indeed, will not seek to have it reversed, and the Government can not. whatever statute may exist on the subject. Such a statute will be interpreted with the
(United States vs. Sanges, 144 U.S., 310.) But the fact that the judgment of a court having Constitution, and be held to apply only to cases where it constitutionally may. And if it
jurisdiction of the case is practically final affords no reason for allowing its validity and undertakes to give to the State the right of appeal, to retry the party charged, after
conclusiveness to be impugned in another case. * * * As to the defendant who- had been acquittal, it is invalid. And so the writ of error, or the like, allowed to the State, can
acquitted by the verdict duly returned and received, the court could take no other action authorize the State to procure the reversal of erroneous proceedings and commence anew,
than to order his discharge. The verdict of acquittal was final, and could not be reviewed, only in those cases in which the first proceeding did not create legal jeopardy.” (1 Bishop
on error or otherwise, without putting him twice in jeopardy, and thereby violating the Criminal Law (5th ed.), section 1026.)
Constitution. However it may be in England, in this country a verdict of acquittal, although The author’s conclusion has support in the case of People vs. Miner (144 Illinois, 308,
not followed by any judg,ment, is a bar to a subsequent prosecution for the same offense. supra), wherein a statute giving an appeal when the accused had been acquitted ’before a
(United States vs. Sanges, 144 U.S., 310; Commonwealth vs. Tuck, 20 Pick., 356, 365; West competent tribunal, was held in violation of section 10, article 2, of the constitution of that
vs. State, 2 Zabriskie [22 N.J. Law], 212, 231; 1 Lead. Crim. Cas. 532.)" State, providing that no person shall be put twice in jeopardy for the same offense. So in
It is, then, the settled law of this court that former jeopardy includes one who has been the case of People vs. Webb (38 California, 467), a statute undertaking to give the
acquitted by a verdict duly rendered, although no judgment be entered on the verdict, and 700
it was found upon a defective indictment.
700 PHILIPPINE REPORTS ANNOTATED
699
KEPNER VS. UNITED STATES.
VOL. 11, MAY 31, 1904 699

KEPNER VS. UNITED STATES.

right of appeal to the people in criminal cases was held to be limited to the cases in which
errors in the proceedings may occur before legal jeopardy has attached. In the course of a
The protection is not, as the court below held, against the peril of second punishment, but well-considered opinion it was said:
against being again tried for the same offense. “The question thus presented is of most grave importance, and, so far as we are advised,
We are not here dealing with those statutes which give to the Government a right of has never been directly passed upon by this court; hence we have given it a most patient
review upon the steps merely preliminary to a trial and before the accused is legally put in consideration, and after a careful examination of the authorities as to the construction of
jeopardy, as where a discharge is had upon motion to quash or a demurrer to the similar provisions in the constitutions of other States, and the Constitution of the United
indictment is sustained before jeopardy has attached. Such statutes have been quite States, we are entirely satisfied that this court has no authority in criminal cases, under our
generally sustained in jurisdictions which deny the right of second trial where a competent State constitution, to order a new trial of a defendant at the instance of the prosecution
court has convicted or acquitted the accused. (People vs. Webb, 38 California, 467.) Mr. for mere errors in the ruling of the court during the progress of the trial after the jury have
 28

been charged with the case and have rendered a verdict of not guilty. No case has been “This case, in its view of former jeopardy, stands out in bold relief against the commonly
called to our attention, and after a most diligent examination of authorities, we have not understood meaning of what constitutes once in jeopardy.”
been able to find a single American case where a retrial has been ordered or sanctioned by
an appellate court at the instance of the prosecution, after the defendant had once been And further:
put upon his trial for an alleged felony, upon a valid indictment before a competent court “The law almost universally prevalent is that a verdict of acquittal in a criminal case is final
and jury and acquitted by the verdict of such jury; but we find a vast number of and conclusive, and that there can be no new trial of a criminal prosecution after an
adjudications of the highest judicial tribunals of the different States and many of the acquittal in it.” (People vs. Corning, 2 N.Y., 9; 49 Am. Dec., 364, and note; 48 Am. St. Rep.,
Federal courts to the effect that no such retrial is authorized by the common law, and is 213, 214.)
‘directly interdicted by the Constitution of the United States, and also of most of the
several States. The universal maxim ’of the common law of England, as Sir William The Ball case (163 U.S., supra), establishes that to try a man after a verdict of acquittal is
Blackstone expresses it, ‘that no man is to be brought into jeopardy of his life more than to put him twice in jeopardy, although the verdict was not followed by judgment. That is
once for the same offense/ is embraced in Article V of amendments to the Constitution of practically the case under consideration, viewed in the most favorable aspect for the
the United States, and in the constitutions of several States, in the following language: Government;. The Court of First Instance, having jurisdiction to try the question of the guilt
‘Nor shall any person, be subject for the same offense to be twice put in jeopardy of life or or innocence of the accused, found Kepner not guilty; to try him again upon the merits,
limb; ’and in many other States the same principle is incorporated in the organic law, in even in an appellate court, is to put him a second

701 702

VOL. 11, MAY 31, 1904 702 701 PHILIPPINE REPORTS ANNOTATED

KEPNER VS. UNITED STATES. KEPNER VS. UNITED STATES.

language substantially the same as hereinbefore quoted from the constitution of this time in jeopardy for the same offense, if Congress used the terms as construed by this
State. While the constitutions of some few States are destitute of this or any similar court in passing upon their meaning. We have no doubt that Congress must be held to
provision, other State constitutions, such as of New Hampshire, Rhode Island, New Jersey have intended to have used these words in the wellsettled sense as declared and settled by
and Iowa, merely interdict a second trial for the same offense after acquittal.” the decisions of this court.

The case of State vs. Lee (65 Connecticut, 265), in the reasoning of the court, seems It follows that Military Order No. 58, as amended by act of the Philippine Commission, No.
opposed to this view. But no reference is made in the course of the opinion to any 194, in so far as it undertakes to permit an appeal by the Government after acquittal, was
constitutional requirement in Connecticut as to double jeopardy. An examination of the repealed by the act of Congress of July, 1902, providing immunity from second jeopardy for
constitution of that State and amendments as published in General Statutes of Connecticut the same criminal offense.
Revision of 1902, discloses no provision upon the subject of jeopardy, and We conclude
there is none. This conclusion renders it unnecessary to consider, if the question was presented in this
case, whether the accused was entitled to the right of a trial by jury.
The exceptional character of the decision in State vs. Lee is stated by the learned editor of
American State Reports in a note to the case as reported in 48 Am. St. Rep., 202, in the Judgment reversed and prisoner discharged.
following language:
 29

Mr. JUSTICE HOLMES, with whom concurred Mr. JUSTICE WHITE and Mr. JUSTICE People vs. Olcott (2 Johns. Cas. 301) ; S.C. (2 Day, 507, n.); United States vs. Morris (1
MCKENNA, dissenting: Curtis, 23), and to the well-reasoned decision in State vs. Lee (65 Connecticut, 265).

I regret that I am unable to agree with the decision of the majority of the court. The case is If a statute should give the right to take exceptions to the Government, I believe it would
of great importance, not only in its immediate bearing upon the administration of justice in be impossible to maintain that the prisoner would be protected by the Constitution from
the Philippines, but, since the words used in the act of Congress are also in the being tried again. He no more would be put in jeopardy a second time when retried
Constitution, even more because the decision necessarily will carry with it an because of a mistake of law in his favor, than he would be when retried for a mistake that
interpretation of the latter instrument. If, as is possible, the constitutional prohibition did him harm. It can not matter that the prisoner procures the second trial. In a capital
should be extended to misdemeanors (Ex parte Lange, 18 Wall., 163, 173), we shall have case, like Hopt vs. People, a man can not waive, and certainly will not be taken to waive
fastened upon the country a document covering the whole criminal law, which, it seems to without meaning it, fundamental constitutional rights. (Thompson vs. Utah, 170 U.S., 343,
me, will have serious and evil consequences. At the present time in this country there is 353, 354.) Usually no such waiver is expressed or thought of. Moreover, it can not be
more danger that criminals will escape justice than that they will be subjected to tyranny. imagined that the law would deny to a prisoner the correction of a
But I do not stop to consider or to state the consequences in detail, as such considerations
are not supposed to be entertained by judges, except as inclining them to one of two 704
interpretations, or as a tacit ’last resort in case of doubt. It is more pertinent to observe 704 PHILIPPINE REPORTS ANNOTATED
that it seems to me that logically and rationally
KEPNER VS. UNITED STATES.
703

VOL. 11, MAY 31, 1904 703

fatal error, unless he should waive other rights so important as to be saved by an express
KEPNER VS. UNITED STATES.
clause in the Constitution of the United States.

It might be said that when the prisoner takes exceptions he only is trying to get rid of a
a man can not be said to be more than once in jeopardy in the same cause, however often jeopardy that already exists—that so far as the verdict is in his favor, as when he is found
he may be tried. The jeopardy is one continuing jeopardy from its beginning to the end of guilty of manslaughter upon an indictment for murder, according to same decisions he will
the cause. Everybody agrees that the prin-ciple in its origin was a rule forbidding a trial in a keep it and can be retried only for the less offense, so that the jeopardy only is continued
new and independent case where a man already had been tried once. But there is no rule to the extent that it already has been determined against him, and is continued with a
that a man may not be tried twice in the same case. It has been decided by this court that chance of escape. I believe the decisions referred to to be wrong, but, assuming them to be
he may be tried a second time, even for his life, if the jury disagree (United States vs. Perez, right, we must consider his position at the moment when his exceptions are sustained. The
9 Wheat, 579; see Simmons vs. United States, 142 U.S.,148; Logan vs. United States, 144 first verdict has been set aside. The jeopardy created by that is at an end, and the question
U.S., 263; Thompson vs. United States, 155 U.S., 271), or notwithstanding their agreement is what shall be done with the prisoner. Since at that moment he no longer is in jeopardy
and verdict, if the verdict is set aside on the prisoner’s exceptions for error in the trial from the first verdict, if a second trial in the same case is a second jeopardy even as to the
(Hopt vs. People, 104 U.S., 631, 635; 110 U.S., 574; 114 U.S., 488, 492; 120 U.S., 430, 442; less offense, he has a right to go free. In view of these difficulties it has been argued that
United States vs. Ball, 163 U.S., 662, 672). He even may be tried on a new indictment if the on principle he has that right if a mistake of law is committed at the first trial. (1 Bish.
judgment on the first is arrested upon motion. (Ex parte Lange, 18 Wall., 163, 174; 1 Bish. Crim. Law (5th ed.), secs. 999, 1047.) But even ,Mr. Bishop admits that the decisions are
Crim. Law (5th ed.), sec. 998.) I may refer further to the opinions of Kent and Curtis in otherwise, and the point is settled in this court by the cases cited above. That fetish happily
being destroyed, the necessary alternative is that the Constitution permits a second trial in
the same case. The reason, however, is not the fiction that a man is not in jeopardy in case
 30

of a misdirection, for it must be admitted that he is in jeopardy, even when the error is commander in General Orders, No. 58, and. of the Philippine Commis-sion in the Act of
patent on the face of the record, as when he is tried on a defective indictment, if judgment August 10, 1901 (No. 194), in both of which an appeal to the Supreme Court was
is not arrested. (United States vs. Ball, 163 U.S., 662.) Moreover, if the fiction were true, it contemplated, even after a judgment of acquittal. I think this also must have been the
would be equally true when the misdirection was in favor of the prisoner. The reason, I intention of Congress, particularly in view of sec. 9 of the Philippine Act of July 1, 1902,
submit, is that there can be but one jeopardy in one case. I have seen no other, except the which
suggestion of waiver, and that I think can not stand.
706
If what I have said so far is correct, no additional argu-
706 PHILIPPINE REPORTS ANNOTATED
705
DORR VS. UNITED STATES.
VOL. 11, MAY 31, 1904 705

KEPNER VS. UNITED STATES.

provided that “the Supreme Court and the Courts of First Instance of the Philippine Islands
shall possess and exercise jurisdiction as heretofore provided * * * subject to the power of
.said Government to change the practice and method of procedure.” It seems to me
ment is necessary to show that a statute may authorize an appeal by the Government impossible to suppose that Congress intended to place in the hands of a single judge the
from the decision by a magistrate to a higher court, as well as an appeal by the prisoner. great and dangerous power of finally acquitting the most notorious criminals.
The latter is every day practice, yet there is no doubt that the prisoner is in jeopardy at the
trial before the magistrate, and that a conviction or acquittal not appealed from would be __________
a bar to a second prosecution. That is what was decided, and it is all that was decided or
intimated, relevant to this case, in Wemyss vs. Hopkins (L. R., 10 Q.B., 378). For the © Copyright 2019 Central Book Supply, Inc. All rights reserved.
reasons which I have stated already, a second trial in the same case must be regarded as
only a continuation of the jeopardy which began with the trial below.

Mr. JUSTICE BROWN, dissenting:

Under our Anglo-Saxon system of jurisprudence, I have always supposed that a verdict of
acquittal upon a valid indictment terminated the jeopardy, that no further proceedings for
a review could be taken either in the same or in an appellate court, and that it was
extremely doubtful whether even Congress could constitutionally authorize such review.

Conceding all this, however, I think that in applying the principle to the Philippine Islands,
Congress intended to use the words in the sense in which they had theretofore been
understood in those Islands. By that law, in which trial by jury was unknown, the jeopardy
did not terminate, if appeal were taken to the audiencia or Supreme Court, until that body
had acted upon the case. The proceedings before the Court of First Instance were in all
important cases reviewable by the Supreme Court upon appeal, which acted finally upon
the case and terminated the jeopardy. This was evidently the view of the military
 31

G.R. No. L-14787 January 28, 1961 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
COLGATE-PALMOLIVE PHILIPPINE, INC., petitioner, flavors" mentioned in section 2 of the Exchange Tax Law refers only to those used in the
vs. preparation or manufacture of food or food products. Not satisfied, the petitioner brought
HON. PEDRO M. GIMENEZ as Auditor General and ISMAEL MATHAY as AUDITOR OF THE the case to this Court thru the present petition for review.
CENTRAL BANK OF THE PHILIPPINES, respondents.
The decisive issue to be resolved is whether or not the foreign exchange used by
Ross, Selph and Carrascoso for petitioner. petitioner for the importation of dental cream stabilizers and flavors is exempt from the
Office of the Solicitor General for respondents. 17% special excise tax imposed by the Exchange Tax Law, (Republic Act No. 601) so as to
GUTIERREZ DAVID, J.: entitle it to refund under section 2 thereof, which reads as follows:

The petitioner Colgate-Palmolive Philippines, Inc. is a corporation duly organized and SEC, 2. The tax collected under the preceding section on foreign exchange used for the
existing under Philippine laws engaged in the manufacture of toilet preparations and payment of the cost, transportation and/or other charges incident to importation into the
household remedies. On several occasions, it imported from abroad various materials Philippines of rice, flour, canned milk, cattle and beef, canned fish, soya beans, butterfat,
such as irish moss extract, sodium benzoate, sodium saccharinate precipitated calcium chocolate, malt syrup, tapioca, stabilizer and flavors, vitamin concentrate, fertilizer,
carbonate and dicalcium phosphate, for use as stabilizers and flavoring of the dental poultry feed; textbooks, reference books, and supplementary readers approved by the
cream it manufactures. For every importation made of these materials, the petitioner paid Board of Textbooks and/or established public or private educational institutions;
to the Central Bank of the Philippines the 17% special excise tax on the foreign exchange newsprint imported by or for publishers for use in the publication of books, pamphlets,
used for the payment of the cost, transportation and other charges incident thereto, magazines and newspapers; book paper, book cloth, chip board imported for the printing
pursuant to Republic Act No. 601, as amended, commonly known as the Exchange Tax of supplementary readers (approved by the Board of Textbooks) to be supplied to the
Law. 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,
On March 14, 1956, the petitioner filed with the Central Bank three applications for hormones, x-ray films, laboratory reagents, biologicals, dental supplies, and
refund of the 17% special excise tax it had paid in the aggregate sum of P113,343.99. The pharmaceutical drugs necessary for compounding medicines; medical and hospital
claim for refund was based on section 2 of Republic Act 601, which provides that "foreign supplies listed in the appendix to this Act, in quantities to be certified by the Director of
exchange used for the payment of the cost, transportation and/or other charges incident Hospitals as actually needed by the hospitals applying therefor; drugs and medicines listed
to the importation into the Philippines of . . . stabilizer and flavors . . . shall be refunded to in the said appendix; and such other drugs and medicines as may be certified by the
any importer making application therefor, upon satisfactory proof of actual importation Secretary of Health from time to time to promote and protect the health of the people of
under the rules and regulations to be promulgated pursuant to section seven thereof." the Philippines shall be refunded to any importer making application therefor, upon
After the applications were processed by the officer-in-charge of the Exchange Tax satisfactory proof of actual importation under the rules and regulations to be
Administration of the Central Bank, that official advised, the petitioner that of the total promulgated pursuant to section seven thereof." (Emphasis supplied.)
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 The ruling of the Auditor General that the term "stabilizer and flavors" as used in the law
benzoate and precipitated calcium carbonate had been approved. The auditor of the refers only to those materials actually used in the preparation or manufacture of food and
Central Bank, however, refused to pass in audit its claims for refund even for the reduced food products is based, apparently, on the principle of statutory construction that
amount fixed by the Officer-in-Charge of the Exchange Tax Administration, on the theory "general terms may be restricted by specific words, with the result that the general
that toothpaste stabilizers and flavors are not exempt under section 2 of the Exchange Tax language will be limited by the specific language which indicates the statute's object and
Law. 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
 32

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.
 33

G.R. No. 101976 January 29, 1993 Confirmation Receipt No Date of Payment Amount Paid

THE COMMISSIONER OF INTERNAL REVENUE, petitioner, B6402542 9-10-86 P 2,952,349.23

vs. B12581298 6-30-87 31,003,129.89
THE COMMISSION ON AUDIT, respondent. B12581904 7-31-87 30,000,000.00
B12601251 10-01-87 30,000,000.00
G.R. No. 102258 January 29, 1993 — ——————
TIRSO B. SAVELLANO, petitioner, Total P93,955,479.12
vs. By a letter dated November 28, 1986, then BIR Commissioner Bienvenido Tan, Jr.
THE COMMISSION ON AUDIT, respondent. recommended to the Minister of Finance payment to petitioner Savellano of an informer's
Law Firm of Armando A. Armovit for petitioner in G.R. No. 102258. 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
NARVASA, C.J., J.: the aforesaid amount.
The issues joined in these consolidated petitions focus, as it were, on the general audit The records do not show when the informer's reward in the PNOC case was
jurisdiction of the Commission of Audit vis-a-vis the Bureau of Internal Revenue's power recommended for payment; only that it was approved by then Finance Undersecretary
to determine entitlement to the tax informer's reward under Section 3161 of the Marcelo Fernando.5 Petitioner Savellano was paid his informer's reward in the PNOC case
National Internal Revenue Code. in the total amount of P14,093,321.89 in four (4) installments, the last of them on
On June 25, 1986, petitioner Tirso B. Savellano furnished the Bureau of Internal Revenue December 1, 1987.6
(BIR) with a confidential affidavit of information2 denouncing the National Coal Authority On February 8, 1989, respondent Commission on Audit (COA) rendered COA Decision No.
(NCA) and the Philippine National Oil Company (PNOC) for non-payment of taxes totalling 7407 disallowing in audit the payment of informer's reward to petitioner Savellano in the
P234 Million on interest earnings of their respective money placements with the NCA case on the ground that payment of an informer's reward under Section 281 of the
Philippine National Bank (PNB) since October 15, 1984 to said date. Investigation by the National Internal Revenue Code is conditioned upon the actual recovery or collection of
BIR confirmed the reported tax liabilities, and upon demands thereafter made, NCA and revenues, and no such revenue or income was actually realized or recovered on any
PNOC paid to the BIR the following amounts of taxes corresponding to the period October benefit accrued to the government, since two (2) government agencies were involved.
15, 1984 to August 31, 1986: The income realized by the BIR out of the withholding taxes paid by the NCA was a
NCA Schedule of Payments 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
Confirmation Receipt No. Date of Payment Amount Paid 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
B6402543 9-10-86 P 1,067,682.86 also induce collusion among government offices in order to obtain the informer's reward.
B7373646 10-15-86 14,918,482.19 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
Total P15,986,165.05 held liable to pay informer's reward upon violations committed by government agencies.8
PNOC Schedule of Payments
 34

Petitioner Commissioner of Internal Revenue sought reconsideration of COA Decision No. For his part, petitioner Tirso Savellano questions the COA disallowance on the ground that
740. He was followed by petitioner Tirso Savellano and Mrs. Potenciana Evangelista, the express statutory grant to BIR of the power to allow or disallow claims for payment of
former Chief of the BIR Accounting Division after the COA Resident Auditor issued Revised tax informer's reward is an implied statutory denial of the same power to the COA, which
Certificate of Settlement and Balances (CSB) No. 89-0001-104(c) dated July 20, would otherwise transform said respondent into "a super tax authority" and "undermine
1989,9 directing the withholding of salaries or any amount due them and to the following and dilute the substance and efficacy of the very entity created and empowered by law to
BIR officials/employees/persons who were being held personally liable for the disallowed collect taxes and augment the government's revenue collecting potentials"13 He further
amount of P11,397,924.75:10 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
Atty. Jaime Maza, Chief, Legal Division income from the exercise of corporate/proprietary/private functions, which does not, in
Mrs. Potenciana Evangelista, Chief, Rev. Acctg. Division and by itself, constitute public funds. It is only when such income is taxed that whatever
Mr. Jesus Parado, Chief, Personnel & Adm. Office part thereof corresponds to the amount of the tax becomes part of the national treasury,
Atty. Vicente Y. Puno, Asst. Commissioner, Personnel & Adm. thereby redounding to the benefit of the government.
Mr. Marcelo N. Fernando, Undersecretary of Finance
Mr. Eufracio Santos, Deputy Commissioner, BIR Required to comment on the petition in G.R. No. 101976, and later, on the petition in G. R.
Mr. Jose A. Resurreccion, Asst. Commissioner, Administrative No. 102258, the Solicitor General begged off on the ground that "its position is different
Ms. Marilyn Soledad, Researcher, Legal Division from the stand taken by respondent Commission on Audit (COA) in the present case" and
Atty. Alicia P. Clemeno, Chief, Law Division sought to be excused from further representing respondent COA, in whose behalf he
Mr. Melchor S. Ramos, Chief, Financial & Mgt. prayed for a reasonable period of time to file its own comment.14 In its Resolution of
Mrs. Elena C. Pineda, Special Disbursing Officer. 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
These pleas were denied due course in COA Decision No. 1930,11 denying due course to required the latter to file its own comment within ten (10) days from notice.15 In G.R. No.
the requests for reconsideration. Hence, these separate petitions, which were ordered 102258, however, the Court denied a similar plea. It required the Solicitor General to
consolidated in the Court's Resolution dated March 10, 1992 in G.R. No. 102258.12 explain within ten (10) days from notice why his position was different from COA's, and
In seeking nullification of COA Decisions Nos. 740 and 1930 in G.R. No. 101976, petitioner gave said respondent a period of ten (10) days to file its comment on the petition, if it so
Commissioner of Internal Revenue argues that: the approval by the Department of desired. 16
Finance of the claim for informer's reward of petitioner Savellano is conclusive upon the Briefly put, the Solicitor General's explanation is that he found COA's disallowance of the
executive agencies concerned, respondent COA included, as it constitutes the final informer's reward erroneous because: government corporations are subject to tax under
determination of the proper administrative authority under Section 90 of the Government the NIRC; having personalities distinct from the government, if they evade payment of
Auditing Code of the Philippines; there were actual cash collections of P109,941,644.17 their taxes, the amounts corresponding to such liabilities could be utilized for purposes
from NCA and PNOC for non-payment of withholding taxes on interest earnings, which exclusive to them; contrarily, if they do pay their taxes, the amounts so paid accrue to the
amount had accrued to the General Fund; Section 316 (now 281) of the National Internal General Fund; Section 281 of the NIRC does not make any distinction among taxpayers
Revenue Code (NIRC) entitling an informer to a reward for information leading to the from whom taxes are eventually recovered; it simply prescribes that for an informer to be
collection of internal revenue taxes is clear and needs no interpretation; and assuming entitled to the reward, the information he furnishes should result in the recovery of
that it does, it should be interpreted in favor of the informer; NCA and PNOC have revenues; statutes offering reward must be liberally construed in favor of informers; the
separate personalities from the Bureau of Internal Revenue as well as the Government possibility of collusion is not sufficient basis for disallowance, since collusion cannot be
and the State; and superior and subordinate officers of the government are not civilly assumed, while the official acts of the BIR and the Department of Finance are entitled to a
liable for acts done in the performance of their official duties. presumption of regularity; even if the taxpayers referred to by an informer are private
 35

entities, the possibility of collusion still remains; such a consideration, moreover, goes into the government, or any of its subdivisions, agencies or instrumentalities. . . ."18 To ensure
the wisdom of the law a matter that concerns the legislature and not the courts, much the effective discharge of its functions, it has been empowered, subject to the limitations
less, COA; and there being no evidence of any irregularity, the determination made by the imposed by Article IX (D) of the 1987 Constitution, to define the scope of its audit and
BIR should be binding upon COA pursuant to the Government Auditing Code. examination, establish the techniques and methods required therefor, and promulgate
accounting and auditing rules and regulations, including those for the prevention and
Respondent COA questions the personality of petitioner Commissioner of Internal disallowance of irregular, unnecessary, excessive, extravagant or unconscionable
Revenue to bring the instant suit, arguing that the Commissioner is not an aggrieved party expenditures or uses of government funds and properties.19
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 The final determination made by the Finance Department cannot bind respondent COA or
contends, the statutorily granted power of the Secretary of Finance under Section 90, P.D. foreclose its review thereof in the exercise of its constitutional function and duty to
1445 must yield. It insists that petitioner Savellano is not entitled to the informer's reward ensure that public funds are expended and used in conformity with law. To hold otherwise
because there was no actual collection of revenues under the benefit-to-the-government would be to ignore the clear mandate and the equally clear implications of Section 3,
rule; and Savellano's alleged information did not lead to the discovery of a fraud. It Article IX (D)of the 1987 Constitution providing that:
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 law shall be passed exempting any entity of the government of its subsidiary in any
No. 89-0001-104 (c) held liable for participation in illegal or irregular disbursements of guise whatever, or any investment of public funds, from the jurisdiction of the
public funds by reason of their respective duties. Commission on Audit.

The Commissioner of Internal Revenue, in assailing respondent COA's authority to The exercise by respondent COA of its general audit power is among the constitutional
disallow the payment of informer's reward, relies heavily on Section 90 of P.D. No. 1445, mechanisms that give life to the check-and-balance system inherent in a republican form
otherwise known as the "Government Auditing Code of the Philippines." A reading of said of government such as ours. Taken in this light, such exercise cannot be regarded as an
provision, which is quoted hereunder, shows that such reliance is misplaced: 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
Sec. 90. Payment of rewards. — When a reward becomes payable by authority of law for provided by law and the amount thereof. As held in Dingcong vs. Guingona, Jr., et al:
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 Constitutional Law; Administrative Law; Power and authority of COA. — Not only is the
paid in such manner as shall be prescribed by executive order. The final determination by Commission on Audit (COA) vested with the power and authority, but it is also charged
the proper administrative authority pursuant to law or any such order, as to whether or with the duty, to examine, audit and settle all accounts pertaining to . . . the expenditures
not the persons concerned are entitled to any reward and the amount thereof, shall be or uses of funds . . . owned by, or pertaining to, the Government or any of its subdivisions,
conclusive upon the executive agencies concerned as regards the liability of the agencies, or instrumentalities (Article IX [D], Section 2[1], 1987 Constitution). That
government. 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
The final determination by the Department of Finance, through the recommendation of jurisdiction, it determines whether or not the fiscal responsibility that rests directly with
the BIR, of petitioner Savellano's entitlement to the informer's reward is, under Section the head of the government agency has been properly and effectively discharged (Section
90, conclusive only upon the executive agencies concerned. Respondent COA is not an 25[l], ibid.), and whether or not there has been loss or wastage of government resources.
executive agency. It is one of the three (3) independent constitutional It is also empowered to review and evaluate contracts (Section 18[4], ibid.). And, after an
commissions.17 Specifically, it is the constitutional agency vested with the "power, audit has been made, its auditors issue a certificate of settlement to each officer whose
authority and duty to examine, audit and settle all accounts pertaining to the revenue and account has been audited and settled in whole or in part, stating the balances found due
receipts of, and expenditures or uses of funds and property owned or held in trust by . . .
 36

thereon and certified, and the charges or differences arising from the settlement by functions. Their revenues do not automatically devolve to the general coffers of the
reason of disallowances, charges or suspensions (Section 82, ibid.). 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
This is not to say, however, that the disallowance in audit by respondent COA is in itself expenditure in government projects; such revenues remain said agencies' in their entirety,
final. The same may be set aside and nullified by this Court, if done with grave abuse of to be applied to and expended for their own exclusive purpose. Clearly, then, when said
discretion. revenues are subjected to tax, the portion thereof corresponding to such tax becomes, in
The informer's reward granted to petitioner Savellano is based on Section 316 (now 281) its own, revenue for the government accruing to the General Fund.
of the National Internal Revenue Code.20 It reads: That the informer's reward was sought and given in relation to tax delinquencies of
Sec. 281. Informers reward to persons instrumental in the discovery of violation of the government agencies provides no reason for disallowance. The law on the matter makes
National Internal Revenue Code and in the discovery and seizure of smuggled goods. 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
(1) For violation of the National Internal Revenue Code. Any person except an internal operation that the person or entity concerned is subject to, and violated, revenue laws,
revenue official or employee, or other public official, or his relative within the sixth grade and the informer's report thereof resulted in the recovery of revenues. It is elementary
of consanguinity, who voluntarily gives definite and sworn information, not yet in the that where the law does not distinguish, none must be made. Ubi lex non distinguit nec
possession of the Bureau of Internal Revenue, leading to the discovery of frauds upon nos distinguere debemos.21
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 The Solicitor General correctly dismisses the mere possibility of collusion to obtain the
imposition of any fine or penalty, shall be rewarded in the sum equivalent to fifteen per informer's reward as sufficient ground for disallowance. Collusion cannot be presumed. It
centum of the revenues, surcharges or fees recovered and/or fine or penalty imposed and must be proved by clear and convincing evidence. In the case at bar, there is no showing
collected. The same amount of reward shall also be given to an informer where the of collusion between petitioner Savellano as informer and any official or employee of the
offender has offered to compromise the violation of law committed by him and his offer BIR or the Department of Finance. Neither is there any evidence to overcome the
has been accepted by the Commissioner and in such a case, the fifteen per centum reward presumption of regularity22 enjoyed by the official acts of the BIR and the Department of
fixed herein shall be based on the amount agreed upon in the compromise and collected Finance in approving the claim of petitioner Savellano for informer's reward.
from the offender; Provided, That should no revenues, surcharges or fees be actually Respondent COA considers the payment of informer's reward in this case as placing a
recovered or collected, such person shall not be entitled to a reward: Provided, further, premium upon violations committed by government agencies and therefore, improper. At
That the information mentioned herein shall not refer to a case already pending or first blush, it would appear that by paying the informer's reward, the government
previously investigated or examined by the Commissioner or any of his deputies, agents or punishes itself for violations committed by its own agencies. This, however, is more
examiners, or the Secretary of Finance or any of his deputies or agents: Provided, finally, apparent than real. The delinquencies of these agencies are not condoned, much less
That the reward provided herein shall be paid under the regulations issued by the rewarded. It is the person whose information led to the discovery of their transgressions
Commissioner of Internal Revenue with the approval of the Secretary of Finance. who is being rewarded. Although this results in a reduction in the amount of revenues
One of the reasons for respondent COA's disallowance of the informer's reward under actually received, the net effect is that the government still gains from the remaining
consideration is that there was actually no revenue realized or recovered as two (2) amount paid, which otherwise would have been lost to it.
government agencies were involved. This view is simplistic and merits no concurrence. It WHEREFORE, the consolidated petitions are hereby GRANTED. The assailed decisions of
overlooks the fact that the two (2) government agencies involved, NCA and PNOC, possess respondent Commission on Audit are set aside. No pronouncement as to costs.
legal personalities separate and distinct from the Philippine government. Although both
are government-owned and controlled corporations, NCA and PNOC perform proprietary SO ORDERED.
 37

G.R. No. 137004 July 26, 2000 On May 10, 1998, the Second Division of the COMELEC decided Case No. SPA 98-227,
disposing as follows:
ARNOLD V. GUERRERO, petitioner,
vs. "WHEREFORE, premises considered, the Commission (Second Division) RESOLVES to
THE COMMISSION ON ELECTIONS, HON. MANUEL B. VILLAR, JR., as the Speaker of the DISMISS the instant petition for utter lack of merit.
House of Representatives, 11th Congress, HON. ROBERTO P. NAZARENO, as the
Secretary General of the House of Representatives, 11th Congress, RODOLFO C. FARIÑAS "SO ORDERED."4
and GUILLERMO R. RUIZ, respondents. In dismissing Ruiz’s petition, the Second Division of the COMELEC stated, "[T]here is none
DECISION (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,
QUISUMBING, J.: consequently, no candidate to be disqualified."5

Before the Court is a petition for certiorari, prohibition, and mandamus, with prayer for a On May 11, 1998, the elections pushed through as scheduled. The post-election tally of
temporary restraining order and/or preliminary injunction, under Rule 65 of the Rules of votes in Ilocos Norte showed that Fariñas got a total of 56,369 votes representing the
Court. It assails the Order of the Commission on Elections, Second Division, dated May 10, highest number of votes received in the first district. Fariñas was duly proclaimed winner.
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 On May 16, 1998, Ruiz filed a motion for reconsideration, contending that Fariñas could
for the elective office of Congressman in the first district of Ilocos Norte during the May not validly substitute for Chevylle V. Fariñas, since the latter was not the official candidate
11, 1998 elections. It also assails the Resolution dated May 16, 1998, of the COMELEC En of the Lakas ng Makabayan Masang Pilipino (LAMMP), but was an independent
Banc, denying the motion for reconsideration filed by respondent Ruiz and dismissing the candidate. Another person cannot substitute for an independent candidate. Thus, Fariñas’
petition-in-intervention filed by herein petitioner Arnold V. Guerrero. certificate of candidacy claiming to be the official candidate of LAMMP in lieu of Chevylle
V. Fariñas was fatally defective, according to Ruiz.
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 On June 3, 1998, Fariñas took his oath of office as a member of the House of
been campaigning as a candidate for Congressman in the May 11, 1998 polls, despite his Representatives.
failure to file a Certificate of Candidacy for said office. Ruiz averred that Fariñas’ failure to On June 10, 1998, petitioner herein filed his "Petition-In-Intervention" in COMELEC Case
file said Certificate violated Section 73 of the Omnibus Election Code2 in relation to No. SPA 98-227. Petitioner averred that he was the official candidate of the Liberal Party
COMELEC Resolution No. 2577, dated January 15, 1998. Ruiz asked the COMELEC to (LP) in said elections for Congressman, and stood to be adversely affected by Case No. SPA
declare Fariñas as a "nuisance candidate" pursuant to Section 69 of the Omnibus Election 98-227. Guerrero contended that Fariñas, having failed to file his Certificate of Candidacy
Code3 and to disqualify him from running in the May 11, 1998 elections, as well as in all on or before the last day therefor, being midnight of March 27, 1998, Fariñas illegally
future polls. resorted to the remedy of substitution provided for under Section 77 of the Omnibus
On May 8, 1998, Fariñas filed his Certificate of Candidacy with the COMELEC, substituting Election Code6 and thus, Fariñas’ disqualification was in order. Guerrero then asked that
candidate Chevylle V. Fariñas who withdrew on April 3, 1998. 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 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 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:
 38

"PRESCINDING FROM THE FOREGOING PREMISES, this Commission (En Banc) RESOLVED, Did the COMELEC commit grave abuse of discretion in holding that the determination of
as it hereby RESOLVES, to AFFIRM the Order of the Commission (Second Division) and the validity of the certificate of candidacy of respondent Fariñas is already within the
thereafter, DISMISS this instant motion for reconsideration for lack of jurisdiction (italics in exclusive jurisdiction of the Electoral Tribunal of the House of Representatives?
the original) without prejudice to the filing of a quo warranto case, if he so desires.
In its assailed resolution, the COMELEC had noted that respondent Fariñas had taken his
"SO ORDERED."7 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.
Hence, the instant petition, anchored on the following grounds:
Petitioner Guerrero argues that the refusal of the COMELEC to rule on the validity or
A.....THE RESPONDENT COMELEC GRAVELY ABUSED ITS DISCRETION AND ACTED IN EXCESS invalidity of the certificate of candidacy of Fariñas amounted to grave abuse of discretion
AND/OR WITHOUT JURISDICTION IN REFUSING TO RULE ON THE VALIDITY OR INVALIDITY on its part. He claims that COMELEC failed in its Constitutional duty to uphold and enforce
OF THE CANDIDACY OR PURPORTED CERTIFICATE OF CANDIDACY OF PRIVATE all laws relative to elections.9 He relies on Gallardo v. Judge Tabamo, Jr., 218 SCRA 253
RESPONDENT FARIÑAS. (1993), which reiterated the doctrine laid down in Zaldivar v. Estenzo, 23 SCRA 533 (1968),
B.....THE RESPONDENT COMELEC GRAVELY ABUSED ITS DISCRETION AND ACTED IN EXCESS that the COMELEC has exclusive charge of the enforcement and administration of all laws
AND/OR WITHOUT JURISDICTION IN TOSSING THE DUTY TO RULE ON THE VALIDITY OR relative to the conduct of an electoral exercise.
INVALIDITY OF THE CANDIDACY OR PURPORTED CERTIFICATE OF CANDIDACY OF PRIVATE A special civil action for certiorari may be availed of when the tribunal, board, or officer
RESPONDENT FARIÑAS TO THE HOUSE OF REPRESENTATIVES ELECTORAL TRIBUNAL exercising judicial or quasi-judicial functions has acted without or in excess of jurisdiction
(HRET) CONSIDERING THAT THE LATTER (HRET) OBVIOUSLY LACKS JURISDICTION TO RULE and there is no appeal or any plain, speedy, and adequate remedy in the ordinary course
ON THE ISSUE THEREBY UNDULY CREATING A VACUUM AND RENDERING PETITIONER of law for the purpose of annulling the proceeding.10 It is the proper remedy to question
WITHOUT A REMEDY. any final order, ruling and decision of the COMELEC rendered in the exercise of its
C.....THE RESPONDENT COMELEC GRAVELY ABUSED ITS DISCRETION AND ACTED IN EXCESS adjudicatory or quasi-judicial powers.11 But for an action for certiorari to prosper, there
AND/OR WITHOUT JURISDICTION IN NOT RENDERING A RULING, BASED ON THE FACTS AS must be a showing that the COMELEC acted with grave abuse of discretion. This means
STATED IN ITS ASSAILED RESOLUTION DATED JANUARY 6, 1999 (Annex "B" hereof) such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction
DISQUALIFYING PRIVATE RESPONDENT FARIÑAS AS A CANDIDATE FOR CONGRESSMAN OF or excess thereof, as where the power is exercised in an arbitrary and despotic manner by
THE FIRST LEGISLATIVE DISTRICT OF ILOCOS NORTE DURING THE MAY 11, 1998 reason of passion or personal hostility, and it must be so patent as to amount to an
ELECTIONS, PREMISED ON ITS FINDINGS THAT "THERE IS NONE IN THE RECORDS TO evasion of positive duty or a virtual refusal to perform the duty enjoined by law.12
CONSIDER RESPONDENT (FARIÑAS) AN OFFICIAL CANDIDATE TO SPEAK OF WITHOUT THE In the present case, we find no grave abuse of discretion on the part of the COMELEC
FILING OF SAID CERTIFICATE, HENCE, THERE IS NO CERTIFICATE OF CANDIDACY TO BE when it held that its jurisdiction over Case No. SPA 98-277 had ceased with the
CANCELLED, CONSEQUENTLY, NO CANDIDATE TO BE DISQUALIFIED." assumption of office of respondent Fariñas as Representative for the first district of Ilocos
D.....THE RESPONDENT COMELEC GRAVELY ABUSED ITS DISCRETION AND ACTED IN Norte. While the COMELEC is vested with the power to declare valid or invalid a certificate
EXCESS AND/OR WITHOUT JURISDICTION IN NOT CALLING A SPECIAL ELECTION TO FILL-UP of candidacy, its refusal to exercise that power following the proclamation and
THE VACANT POSITION OF CONGRESSMAN OF THE FIRST LEGISLATIVE DISTRICT OF ILOCOS assumption of the position by Fariñas is a recognition of the jurisdictional boundaries
NORTE DUE TO THE DISQUALIFICATION OF RESPONDENT FARIÑAS AS A CANDIDATE separating the COMELEC and the Electoral Tribunal of the House of Representatives
THERETO AND WHO APPEARS TO HAVE OBTAINED THE HIGHEST NUMBER OF VOTES CAST (HRET). Under Article VI, Section 17 of the Constitution, the HRET has sole and exclusive
IN THE MAY 11, 1998 ELECTIONS. 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
We find pertinent for our resolution this issue: proclaimed, taken his oath, and assumed office as a member of the House of
 39

Representatives, COMELEC’s jurisdiction over election contests relating to his election, "sole judge of all contests relating to the election, returns, and qualifications of their
returns, and qualifications ends, and the HRET’s own jurisdiction begins.13 Thus, the respective members".18
COMELEC’s decision to discontinue exercising jurisdiction over the case is justifiable, in
deference to the HRET’s own jurisdiction and functions. WHEREFORE, the petition is hereby DISMISSED for lack of merit. Costs against petitioner.

However, petitioner contends that the jurisdiction of the HRET as defined under Article VI, SO ORDERED.
Section 17 of the Constitution is limited only to the qualifications prescribed under Article Davide, Jr., C.J., Bellosillo, Melo, Puno, Vitug, Kapunan, Mendoza, Panganiban, Purisima,
VI, Section 6 of the Constitution.14 Consequently, he claims that any issue which does not Pardo, Buena, Gonzaga-Reyes, Ynares-Santiago, and De Leon, Jr., JJ., concur.
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
 40

G.R. No. 95832 August 10, 1992 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
MAYNARD R. PERALTA, petitioner, shall also be without pay (CSC, 2nd Ind., February 12, 1965)."
vs.
CIVIL SERVICE COMMISSION, respondent. Petitioner then sent a latter dated 20 February 1990 addressed to Civil Service
Commission (CSC) Chairman Patricia A. Sto. Tomas raising the following question:
Tranquilino F. Meris Law Office for petitioner.
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
PADILLA, J.: absence without pay on such Saturday, Sunday or Holiday?1

Petitioner was appointed Trade-Specialist II on 25 September 1989 in the Department of Petitioner in his said letter to the CSC Chairman argued that a reading of the General
Trade and Industry (DTI). His appointment was classified as "Reinstatement/Permanent". Leave Law as contained in the Revised Administrative Code, as well as the old Civil Service
Before said appointment, he was working at the Philippine Cotton Corporation, a Law (Republic Act No. 2260), the Civil Service Decree (Presidential Decree No. 807), and
government-owned and controlled corporation under the Department of Agriculture. 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
On 8 December 1989, petitioner received his initial salary, covering the period from 25 deprived of his pay or salary corresponding to the intervening Saturdays, Sundays or
September to 31 October 1989. Since he had no accumulated leave credits, DTI deducted Holidays (in the factual situation posed), and that the withholding (or deduction) of the
from his salary the amount corresponding to his absences during the covered period, same is tantamount to a deprivation of property without due process of law.
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 On 25 May 1990, respondent Commission promulgated Resolution No. 90-497, ruling that
made, are as follows: 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
1. 29 September 1989 — Friday order. 2 The CSC stated that:

2. 30 September 1989 — Saturday 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:
3. 01 October 1989 — Sunday
Mrs. Rosalinda Gonzales is not entitled to payment of salary corresponding to January 23
4. 20 October 1989 — Friday and 24, 1965, Saturday and Sunday, respectively, it appearing that she was present on
5. 21 October 1989 — Saturday 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
6. 22 October 1989 — Sunday 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.
Petitioner sent a memorandum to Amando T. Alvis (Chief, General Administrative Service) (Emphasis supplied)
on 15 December 1989 inquiring as to the law on salary deductions, if the employee has no
leave credits. 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
Amando T. Alvis answered petitioner's query in a memorandum dated 30 January 1990 or Friday, one who has no leave credits, could not be favorably credited with intervening
citing Chapter 5.49 of the Handbook of Information on the Philippine Civil Service which days had the same been working days. Hence, the above policy that for an employee on
 41

leave without pay to be entitled to salary on Saturdays, Sundays or holidays, the same During the pendency of this petition, the respondent Commission promulgated Resolution
must occur between the dates where the said employee actually renders service. To rule No. 91-540 dated 23 April 1991 amending the questioned policy, considering that
otherwise would allow an employee who is on leave of absent (sic) without pay for a long employees paid on a monthly basis are not required to work on Saturdays, Sunday or
period of time to be entitled to payment of his salary corresponding to Saturdays, Sundays Holidays. In said amendatory Resolution, the respondent Commission resolved "to adopt
or holidays. It also discourages the employees who have exhausted their leave credits the policy that when an employee, regardless of whether he has leave credits or not, is
from absenting themselves on a Friday or Monday in order to have a prolonged weekend, absent without pay on day immediately preceding or succeeding Saturday, Sunday or
resulting in the prejudice of the government and the public in general. 3 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
Petitioner filed a motion for reconsideration and in Resolution No. 90-797, the respondent and promulgating the new policy and directing the Heads of Departments, Bureaus and
Commission denied said motion for lack of merit. The respondent Commission in Agencies in the national and local governments, including government-owned or
explaining its action held: controlled corporations with original charters, to oversee the strict implementation of the
The Primer on the Civil Service dated February 21, 1978, embodies the Civil Service circular.
Commission rulings to be observed whenever an employee of the government who has no Because of these developments, it would seem at first blush that this petition has become
more leave credits, is absent on a Friday and/or a Monday is enough basis for the moot and academic since the very CSC policy being questioned has already been amended
deduction of his salaries corresponding to the intervening Saturdays and Sundays. What and, in effect, Resolutions No. 90-497 and 90-797, subject of this petition for certiorari,
the Commission perceived to be without basis is the demand of Peralta for the payment have already been set aside and superseded. But the issue of whether or not the policy
of his salaries corresponding to Saturdays and Sundays when he was in fact on leave of that had been adopted and in force since 1965 is valid or not, remains unresolved. Thus,
absence without pay on a Friday prior to the said days. A reading of Republic Act No. 2260 for reasons of public interest and public policy, it is the duty of the Court to make a formal
(sic) does not show that a government employee who is on leave of absence without pay ruling on the validity or invalidity of such questioned policy.
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 The Civil Service Act of 1959 (R.A. No. 2260) conferred upon the Commissioner of Civil
4, 1960 of House Bill No. 41 (Republic Act No. 2625) reveals that while the law excludes Service the following powers and duties:
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 Sec. 16 (e) with the approval by the President to prescribe, amend and enforce suitable
of inclusio unius est exclusio alterius, the claim of Peralta has no merit. Moreover, to take rules and regulations for carrying into effect the provisions of this Civil Service Law, and
a different posture would be in effect giving more premium to employees who are the rules prescribed pursuant to the provisions of this law shall become effective thirty
frequently on leave of absence without pay, instead of discouraging them from incurring days after publication in the Official Gazette;
further absence without xxx xxx xxx
pay. 4
(k) To perform other functions that properly belong to a central personnel agency. 5
Petitioner's motion for reconsideration having been denied, petitioner filed the present
petition. 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
What is primarily questioned by the petitioner is the validity of the respondent respondent Commission involving the case of a Mrs. Rosalinda Gonzales. The respondent
Commission's policy mandating salary deductions corresponding to the intervening Commission ruled that an employee who has no leave credits in his favor is not entitled to
Saturdays, Sundays or Holidays where an employee without leave credits was absent on the payment of salary on Saturdays, Sundays or Holidays unless such non-working days
the immediately preceding working day. occur within the period of service actually rendered. The same policy is reiterated in the
 42

Handbook of Information on the Philippine Civil Service. 6 Chapter Five on leave of controlled corporations other than those mentioned in Section two hundred sixty-eight,
absence provides that: 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
5.51. When intervening Saturday, Sunday or holiday considered as leave without pay — calendar year of service.
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 Sec. 285-A. In addition to the vacation leave provided in the two preceding sections each
without pay. (CSC, 2nd Ind., Feb. 12, 1965). 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
It is likewise illustrated in the Primer on the Civil Service 7 in the section referring to district in any regularly and specially organized province, other than those mentioned in
Questions and Answers on Leave of Absences, which states the following: Section two hundred sixty-eight, two hundred seventy-one and two hundred seventy-four
27. How is leave of an employee who has no more leave credits computed if: 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
(1) he is absent on a Friday and the following Monday? 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
(2) if he is absent on Friday but reports to work the following Monday? the employee or laborer concerned or of any member of his immediate family.
(3) if he is absent on a Monday but present the preceding Friday? The Civil Service Commission in its here questioned Resolution No. 90-797 construed R.A.
- (1) He is considered on leave without pay for 4 days covering Friday to Monday; 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
- (2) He is considered on leave without pay for 3 days from Friday to Sunday; 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
- (3) He is considered on leave without pay for 3 days from Saturday to Monday. before or immediately preceding a Saturday, Sunday or legal holiday is entitled to
payment of his salary for said days.
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 Administrative construction, if we may repeat, is not necessarily binding upon the courts.
law is at best advisory, for it is the courts that finally determine what the law means. 8 It Action of an administrative agency may be disturbed or set aside by the judicial
has also been held that interpretative regulations need not be published. 9 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
In promulgating as early as 12 February 1965 the questioned policy, the Civil Service
enactment. 10
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: We find this petition to be impressed with merit.
Sec. 1. Sections two hundred eighty-four and two hundred eighty-five-A of the As held in Hidalgo vs. Hidalgo: 11
Administrative Code, as amended, are further amended to read as follows:
. . . . where the true intent of the law is clear that calls for the application of the cardinal
Sec. 284. After at least six months' continues (sic) faithful, and satisfactory service, the rule of statutory construction that such intent or spirit must prevail over the letter
President or proper head of department, or the chief of office in the case of municipal thereof, for whatever is within the spirit of a statute is within the statute, since adherence
employees may, in his discretion, grant to an employee or laborer, whether permanent or to the letter would result in absurdity, injustice and contradictions and would defeat the
temporary, of the national government, the provincial government, the government of a plain and vital purpose of the statute.
chartered city, of a municipality, of a municipal district or of government-owned or
 43

The intention of the legislature in the enactment of R.A. 2625 may be gleaned from, monthly salary basis, deprived of their salaries corresponding to Saturdays, Sundays or
among others, the sponsorship speech of Senator Arturo M. Tolentino during the second legal holidays (as herein petitioner was so deprived) since 12 February 1965, be entitled to
reading of House Bill No. 41 (which became R.A. 2625). He said: recover the amounts corresponding to such non-working days?

The law actually provides for sick leave and vacation leave of 15 days each year of service The general rule vis-a-vis legislation is that an unconstitutional act is not a law; it confers
to be with full pay. But under the present law, in computing these periods of leaves, no rights; it imposes no duties; it affords no protection; it creates no office; it is in legal
Saturday, Sunday and holidays are included in the computation so that if an employee contemplation as inoperative as though it had never been passed. 13
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 But, as held in Chicot County Drainage District vs. Baxter State
that he will be considered as having had a leave of Friday, Saturday, Sunday and Monday, Bank:14
or four days. . . . . It is quite clear, however, that such broad statements as to the effect of a
The purpose of the present bill is to exclude from the computation of the leave those determination of unconstitutionality must be taken with qualifications. The actual
days, Saturdays and Sundays, as well as holidays, because actually the employee is existence of a statute, prior to such determination is an operative fact and may have
entitled not to go to office during those days. And it is unfair and unjust to him that those consequences which cannot always be ignored. The past cannot always be erased by a
days should be counted in the computation of leaves. 12 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
With this in mind, the construction by the respondent Commission of R.A. 2625 is not in corporate; and particular conduct, private and official.
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 To allow all the affected government employees, similarly situated as petitioner herein, to
fifteen (15) days sick leave with full pay, exclusive of Saturdays, Sundays and Holidays in claim their deducted salaries resulting from the past enforcement of the herein
both cases. Thus, the law speaks of the granting of a right and the law does not provide for invalidated CSC policy, would cause quite a heavy financial burden on the national and
a distinction between those who have accumulated leave credits and those who have local governments considering the length of time that such policy has been effective. Also,
exhausted their leave credits in order to enjoy such right. Ubi lex non distinguit nec nos administrative and practical considerations must be taken into account if this ruling will
distinguere debemus. The fact remains that government employees, whether or not they have a strict restrospective application. The Court, in this connection, calls upon the
have accumulated leave credits, are not required by law to work on Saturdays, Sundays respondent Commission and the Congress of the Philippines, if necessary, to handle this
and Holidays and thus they can not be declared absent on such non-working days. They problem with justice and equity to all affected government employees.
cannot be or are not considered absent on non-working days; they cannot and should not It must be pointed out, however, that after CSC Memorandum Circular No. 16 Series of
be deprived of their salary corresponding to said non-working days just because they were 1991 — amending the herein invalidated policy — was promulgated on 26 April 1991,
absent without pay on the day immediately prior to, or after said non-working days. A deductions from salaries made after said date in contravention of the new CSC policy must
different rule would constitute a deprivation of property without due process. be restored to the government employees concerned.
Furthermore, before their amendment by R.A. 2625, Sections 284 and 285-A of the WHEREFORE, the petition is GRANTED, CSC Resolutions No. 90-497 and 90-797 are
Revised Administrative Code applied to all government employee without any distinction. declared NULL and VOID. The respondent Commission is directed to take the appropriate
It follows that the effect of the amendment similarly applies to all employees enumerated action so that petitioner shall be paid the amounts previously but unlawfully deducted
in Sections 284 and 285-A, whether or not they have accumulated leave credits. from his monthly salary as above indicated. No costs.
As the questioned CSC policy is here declared invalid, we are next confronted with the SO ORDERED.
question of what effect such invalidity will have. Will all government employees on a
 44

G.R. No. L-33487 May 31, 1971 Philippines, and from the Chinese vessel "Chungking," accused took delivery, loaded, and
ferried the Chinese aliens in the vessel "MARU XI" owned, operated, under the charge and
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellant, piloted by all the herein accused from outside into the Philippines, sureptitiously landing
vs. the said aliens at Barrio Damortis, Sto. Tomas, La Union, Philippines which place of landing
MAXIMO MARTIN, CANDIDO MARTIN and RODOLPO HIGASHI, defendants-appellees. is not a duly authorized port of entry in the Philippines.
Office of the Solicitor General Felix V. Makasiar, Assistant Solicitor General Isidro C. After the thirty-nine (39) illegal entrants were landed in barrio Damortis, as charged in the
Borromeo and Solicitor Dominador L. Quiroz for plaintiff-appellant. indictment, they were loaded in a car and two jeepneys for transport to Manila. They did
Marianito Licudan for defendants-appellees. not however reach their destination because they were intercepted by Philippine
Constabulary agents in Malolos, Bulacan.

For concealing and harboring these thirty-nine aliens, Jose Pascual, Filipinas Domingo,
CASTRO, J.: Jose Regino, Alberto Bunyi, Emerdoro Santiago and Ibarra Domingo were charged before
the Court of First Instance of Bulacan in criminal case 6258-M. The amended information
This appeal by the People of the Philippines from the order dated August 2, 1968 of the in the said criminal case reads as follows:
Court of First Instance of La Union dismissing criminal case A-392 on the ground of lack of
jurisdiction, was certified by the Court of Appeals to this Court, the issues raised being The undersigned Provincial Fiscal accuses Jose Pascual, Filipinas Domingo, Jose Regino,
purely of law. Alberto Bunyi, Emerdoro Santiago and Ibarra Domingo of the violation of Section 46 of
Commonwealth Act No. 613, otherwise known as the Philippine Immigration Act of 1940,
The central issue is the proper interpretation of the provisions Section 46 of as amended by Republic Act No. 827, committed as follows:
Commonwealth Act 613, as amended by Rep. Act 144 and Rep. Act 327, otherwise known
as the Philippine Immigration Act. That on or about the 22nd day of September, 1966, in the municipality of Malolos,
Province of Bulacan, Philippines, and within the jurisdiction of this Honorable Court, the
The defendants Maximo Martin, Candido Martin and Rodolfo Higashi were charged in above named accused and several others whose identities are still unknown, conspiring
criminal case A-392 of the CFI of La Union with a violation of section 46 of Com. Act 613, and confederating and aiding one another, did then and there wilfully, unlawfully and,
as amended. The information dated January 12, 1968 recites as follows: feloniously, bring conceal and harbor 39 Chinese aliens not duly admitted by any
The undersigned Acting State Prosecutor, and Asst. Provincial Fiscal accuse MAXIMO immigration officer or not lawfully entitled to enter or reside within the Philippines under
MARTIN, CANDIDO MARTIN and RODOLFO HIGASHI of Sec. 46 of Commonwealth Act NO. the terms of the Immigration Laws, whose names are as follows: Hung Chang Cheong,
613 otherwise known as Philippine Immigration Act of 1940, as amended by Republic Act Hung Ling Choo, Sze Lin Chuk, Chian Giok Eng, Mung Bun Bung, Lee Chin Kuo, Gan Kee
No. 827, committed as follows: Chiong, See Sei Hong Chun, Go Kian Sim, Kho Ming Jiat, See Lee Giok, Uy Chin Chu, Go Su
Kim, Go Chu, Chiang Tian, Chua Tuy Tee, Sy Jee Chi, Sy Sick Bian, Sy Kang Liu, Ang Chi Hun,
That on or about the 22nd day of September, 1966, in the Municipality of Sto. Tomas, Kho Chu, Chua Hong, Lim Chin Chin, Ang Lu Him, William Ang, Sy Siu Cho, Ang Puy Hua, Sy
Province of La Union, Philippines, and within the jurisdiction of this Honorable court, the Chi Tek, Lao Sing Tee, Cua Tiong Bio, Kho Lee Fun, Kho Lee Fong, Ang Giok, Sy Si Him, Sy
above-named accused, conspiring and confederating together and mutually helping one Lin Su, Lee Hun, Sy SiongGo and Sy Cho Lung, who previously earlier on the same day, thru
another and in active aid with Filipino nationals who are presently charged before the the aid, help and manipulation of the abovenamed accused, were loaded and ferried to
Court of First Instance of Bulacan in Crim. Case No. 6252-M, did then and there wilfully, the shore from the Chinese vessel "CHIUNG HING" in a fishing vessel known as the "MARU
unlawfully and feloniously bring in and carry into the Philippines thirty nine (39) Chinese Xl" and landed at barrio Damortis, Sto. Tomas, La Union, and immediately upon landing
aliens who traveled by the Chinese vessel "Chungking" from the port of Hongkong and were loaded in 3 vehicles an automobile bearing plate No. H-3812-Manila driven and
who are not duly admitted by any immigration officer or not lawfully entitled to enter the operated by Emerdoro Santiago and 2 jeepneys with plates Nos. S-27151- Philippines,
 45

1966 and S-26327-Philippines, 1966 driven and operated by Jose Regino and Alberto material fact, shall be guilty of an offense and upon conviction thereof, shall be fined not
Bunyi, respectively, and brought southwards along the MacArthur highway and upon more than ten thousand pesos, imprisoned for not more than ten years, and deported if
reaching Malolos, Bulacan, were apprehended by the agents of the Philippine he is an alien.
Constabulary, the latter confiscating and impounding the vehicles used in carrying and
transporting the aid aliens and including the sum of P15,750.00 found in the possession of If the individual who brings into or lands in the Philippines or conceals or harbors any alien
the accused Jose Pascual which was used and/or to be used in connection with the not duly admitted by any immigration officer or not lawfully entitled to enter or reside
commission of the crime charged. herein, or who attempts, conspires with or aids another to commit any such act, is the
pilot, master, agent, owner, consignee, or any person in charge of the vessel or aircraft
On July 1, 1968 the three accused in criminal case A-392 filed a "motion to dismiss" which brought the alien into the Philippines from any place outside thereof, the fine
[quash] on the ground that the CFI of La Union has no jurisdiction over the offense imposed under the first paragraph hereof shall constitute a lien against the vessel or
charged in the said indictment as the court had been pre-empted from taking cognizance aircraft and may be enforced in the same manner as fines are collected and enforced
of the case by the dependency in the CFI of Bulacan of criminal case 6258-M. This motion against vessels under the customs laws: Provided, however, That if the court shall in its
was opposed by the prosecution. discretion consider forfeiture to be justified by the circumstances of the case, it shall
order, in lieu of the fine imposed, the forfeiture of the vessel or aircraft in favor of the
On August 2, 1968 the Court of First Instance of La Union dismissed the case, with costs de Government, without prejudice to the imposition to the penalty of imprisonment
oficio. The Government's motion for reconsideration was denied; hence the present provided in the preceding paragraph.
recourse.
To be stressed at the outset is the significant repetition, in the second paragraph above-
In this appeal the Government contends that the lower court erred (1) "in declaring that quoted, of basic words and concepts set forth in the first paragraph. Thus, the first
the information in the instant case [A-392] alleges conspiracy between the accused herein paragraph begins with: "Any individual who shall bring into or land in the Philippines or
and the persons accused in criminal case 6258-M of the Court of First Instance of conceal or harbor any alien ...;" the second paragraph starts with "If the individual who
Bulacan;" (2) "in holding that by reason of said allegation of conspiracy in the information brings into or lands in the Philippines or conceals or harbors any alien ..." (emphasis
in this case [A-3921], the act of one of the accused in both criminal cases is deemed the supplied) Scanning section 46 in its entire context, it is at once apparent, there being no
act of all the accused and that as a consequence all those accused in the two cases are indication to the contrary, that the act of bringing into, the act of landing, the act
liable and punishable for one offense or violation of section 46 of Commonwealth Act 613, of concealing, the act of harboring, are four separate acts, each act possessing its own
as amended, although committed by and through the different means specified in said distinctive, different and disparate meaning. "Bring into" has reference to the act of
section;" (3) "in holding that the violation of section 46 of Commonwealth Act 613, as placing an alien within the territorial waters of the Philippines. "Land" refers to the act of
amended, committed by the accused in both criminal cases partakes of the nature of a putting ashore an alien. "Conceal" refers to the act of hiding an alien. "Harbor" refers to
transitory or continuing offense;" and (4) "in declaring that it lacks jurisdiction and is now the act of giving shelter and aid to an alien. It is of course understood that the alien
excluded from taking cognizance of this case [A-392] and in dismissing it." brought into or landed in the Philippines, or concealed or harbored, is an "alien not duly
Section 46 of Commonwealth Act 613, as amended, reads as follows: admitted by any immigration officer or not lawfully entitled to enter or reside within the
Philippines under the terms of the immigration laws."1
Any individual who shall bring into or land in the Philippines or conceal or harbor any alien
not duly admitted by any immigration officer or not lawfully entitled to enter or reside The rule is too well-settled to require any citation of authorities that the word "or" is a
within the Philippines under the terms of the immigration laws, or attempts, conspires disjunctive term signifying dissociation and independence of one thing from each of the
with, or aids another to commit any such act, and any alien who enters the Philippines other things enumerated unless the context requires a different interpretation. While in
without inspection of admission by the immigration officials, or obtains entry into the the interpretation of statutes, 'or' may read 'and' and vice versa, it is so only when the
Philippines by wilful, false, or misleading representation or wilful concealment of a context so requires.2
 46

A reading of section 46 above-quoted does not justify giving the word "or" a non- persons accused in this case, namely Maximo Martin, Candido Martin and Rodolfo
disjunctive meaning. Higashi. While the unfortunate insertion in the information of the clause reading, "and in
active aid with Filipino nationals who are presently charged before the CFI of Bulacan in
Bringing into and landing in the Philippines of the 39 aliens were completed when they Criminal Case No. 6258-M," may yield the implication that the three defendants-appellees
were placed ashore in the barrio of Damortis on September 22, 1966. The act of the six and the six accused in criminal case 6258-M before the CFI of Bulacan may have agreed on
accused in criminal case 6258-M before the CFI of Bulacan of transporting the aliens the sequence of the precise steps to be taken in the smuggling of the Chinese aliens and
constitutes the offenses of "concealing" and "harboring," as the terms are used in section on the identities of the persons charged with consummating each step, still there seems
46 of our Immigration Laws. The court a quo in point of fact accepted this interpretation to be no question that the three defendants-appellees are charged only with bringing in
when it observed that "it could happen that different individuals, acting separately from, and landing on Philippine soil the thirty-nine aliens, whereas the six accused in criminal
and independently of each other could violate and be criminally liable for violation of the case 6258-M are charged only with concealing and harboring the said aliens. It is
immigration Act, if each individual independently commits any of the means specified technically absurd to draw a conclusion of conspiracy among the three defendants-
under said section 46 of Commonwealth Act 613, as amended by Republic Act 827. For appellees and the six accused in the criminal case 6258-M before the CFI of Bulacan who
example, an individual act independently, with the use of a motor boat, brings into the are not named defendants in this case.
country and lands several Chinese aliens and after doing so he goes away. There is no
question that said individual violated said section 46 of the Immigration Act, for bringing At all events, the words, "and in active aid with Filipino nationals who are presently
into and landing in the Philippines some alien. Now, after the said landing of the said charged before the CFI of Bulacan in Crim. Case No. 6258-M," can and should be
aliens another individual also acting independently, without connection whatsoever with considered as a surplusage, and may be omitted from the information without doing
the one who brought and landed the said aliens, and knowing that the Chinese aliens have violence to or detracting from the intendment of the said indictment. These words should
no right to enter the country or unlawfully conceals or harbors the said aliens. There is no therefore be disregarded.
doubt that this is also liable and punishable for another separate violation of said section
46 of Commonwealth Act 613." Finally, the court a quo erred in maintaining the view that the acts of bringing into and
landing aliens in the Philippines illegally and the acts of concealing and harboring them
This notwithstanding, the court dismissed this case on the ground that there is an express constitute one "transitory and continuing violation". We here repeat and emphasize that
allegation in the information of connivance between the three defendant-appellees the acts of bringing into and landing an alien in the Philippines are completed once the
herein and the six accused in criminal case 6258-M of the CFI of Bulacan. In our view the alien is brought ashore on Philippine territory, and are separate and distinct from the acts
court a quo incurred in error in reading this conclusion. This error, which is one of of concealing and harboring such alien. If the aliens in this case were apprehended
misinterpretation of the phraseology of the information, was induced by a reading of the immediately after landing, there would be no occasion for concealing and harboring them.
first of the said information which states as follows: Upon the other hand, one set of persons may actually accomplish the act of bringing in
and/or landing aliens in the Philippines, and another completely different set of persons
That on or about the 22nd day of September, 1966, in the Municipality of Sto. Tomas, may conceal and/or harbor them. The general concept of a continuing offense is that the
Province of La Union, Philippines, and within the jurisdiction of this Honorable Court, the essential ingredients of the crime are committed in different provinces. An example is the
abovenamed accused, conspiring and confederating together and mutually helping one complex offense of kidnapping with murder if the victim is transported through different
another and in active aid with Filipino nationals who are presently charged before the CFI provinces before he is actually killed. In such case the CFI of any province in which any one
of Bulacan in Crim. Case No. 6258-M, did then and there wilfully, unlawfully and of the essential elements of said complex offense has been committed, has jurisdiction to
feloniously bring in and ferry into the Philippines thirty-nine (39) Chinese aliens who take cognizance of the offense.3
traveled by the Chinese vessel 'Chungking' from the port of Hongkong ... (Emphasis ours)
The conclusion thus become ineluctable that the court a quo erred in refusing to take
It is crystal-clear that the words, "the above-named accused, conspiring and confederating cognizance of the case at bar.
together and mutually helping one another," can refer only and exclusively to the three
 47

ACCORDINGLY, the order of the Court of First Instance of La Union of August 2, 1968,
dismissing this case and cancelling the bail bond posted by the three defendants-
appellees, is set aside, and this case is remanded for further proceedings in accordance
with law.
 48

G.R. No. L-28196 November 9, 1967 1. R. B. H. (Resolution of Both Houses) No. 1, proposing that Section 5, Article VI, of the
Constitution of the Philippines, be amended so as to increase the membership of the
RAMON A. GONZALES, petitioner, House of Representatives from a maximum of 120, as provided in the present
vs. Constitution, to a maximum of 180, to be apportioned among the several provinces as
COMMISSION ON ELECTIONS, DIRECTOR OF PRINTING and AUDITOR nearly as may be according to the number of their respective inhabitants, although each
GENERAL, respondents. province shall have, at least, one (1) member;
G.R. No. L-28224 November 9, 1967 2. R. B. H. No. 2, calling a convention to propose amendments to said Constitution, the
PHILIPPINE CONSTITUTION ASSOCIATION (PHILCONSA), petitioner, convention to be composed of two (2) elective delegates from each representative
vs. district, to be "elected in the general elections to be held on the second Tuesday of
COMMISSION ON ELECTIONS, respondent. November, 1971;" and

No. 28196: 3. R. B. H. No. 3, proposing that Section 16, Article VI, of the same Constitution, be
Ramon A. Gonzales for and in his own behalf as petitioner. amended so as to authorize Senators and members of the House of Representatives to
Juan T. David as amicus curiae become delegates to the aforementioned constitutional convention, without forfeiting
Office of the Solicitor General for respondents. their respective seats in Congress.

No. 28224: Subsequently, Congress passed a bill, which, upon approval by the President, on June 17,
Salvador Araneta for petitioner. 1967, became Republic Act No. 4913, providing that the amendments to the Constitution
Office of the Solicitor General for respondent. proposed in the aforementioned Resolutions No. 1 and 3 be submitted, for approval by
the people, at the general elections which shall be held on November 14, 1967.
CONCEPCION, C.J.:
The petition in L-28196 was filed on October 21, 1967. At the hearing thereof, on October
G. R. No. L-28196 is an original action for prohibition, with preliminary injunction. 28, 1967, the Solicitor General appeared on behalf of respondents. Moreover, Atty. Juan
T. David and counsel for the Philippine Constitution Association — hereinafter referred to
Petitioner therein prays for judgment: as the PHILCONSA — were allowed to argue as amici curiae. Said counsel for the
1) Restraining: (a) the Commission on Elections from enforcing Republic Act No. 4913, or PHILCONSA, Dr. Salvador Araneta, likewise prayed that the decision in this case be
from performing any act that will result in the holding of the plebiscite for the ratification deferred until after a substantially identical case brought by said organization before the
of the constitutional amendments proposed in Joint Resolutions Nos. 1 and 3 of the two Commission on Elections,1 which was expected to decide it any time, and whose decision
Houses of Congress of the Philippines, approved on March 16, 1967; (b) the Director of would, in all probability, be appealed to this Court — had been submitted thereto for final
Printing from printing ballots, pursuant to said Act and Resolutions; and (c) the Auditor determination, for a joint decision on the identical issues raised in both cases. In fact, on
General from passing in audit any disbursement from the appropriation of funds made in October 31, 1967, the PHILCONSA filed with this Court the petition in G. R. No. L-28224,
said Republic Act No. 4913; and for review by certiorari of the resolution of the Commission on Elections2 dismissing the
petition therein. The two (2) cases were deemed submitted for decision on November 8,
2) declaring said Act unconstitutional and void. 1967, upon the filing of the answer of respondent, the memorandum of the petitioner and
the reply memorandum of respondent in L-28224.
The main facts are not disputed. On March 16, 1967, the Senate and the House of
Representatives passed the following resolutions: Ramon A. Gonzales, the petitioner in L-28196, is admittedly a Filipino citizen, a taxpayer,
and a voter. He claims to have instituted case L-28196 as a class unit, for and in behalf of
 49

all citizens, taxpayers, and voters similarly situated. Although respondents and the the second, this Court proceeded to determine the number of Senators necessary for
Solicitor General have filed an answer denying the truth of this allegation, upon the a quorum in the Senate; in the third, we nullified the election, by Senators belonging to
ground that they have no knowledge or information to form a belief as to the truth the party having the largest number of votes in said chamber, purporting to act on behalf
thereof, such denial would appear to be a perfunctory one. In fact, at the hearing of case of the party having the second largest number of votes therein, of two (2) Senators
L-28196, the Solicitor General expressed himself in favor of a judicial determination of the belonging to the first party, as members, for the second party, of the, Senate Electoral
merits of the issued raised in said case. Tribunal; and in the fourth, we declared unconstitutional an act of Congress purporting to
apportion the representative districts for the House of Representatives, upon the ground
The PHILCONSA, petitioner in L-28224, is admittedly a corporation duly organized and that the apportionment had not been made as may be possible according to the number
existing under the laws of the Philippines, and a civic, non-profit and non-partisan of inhabitants of each province. Thus we rejected the theory, advanced in these four (4)
organization the objective of which is to uphold the rule of law in the Philippines and to cases, that the issues therein raised were political questions the determination of which is
defend its Constitution against erosions or onslaughts from whatever source. Despite his beyond judicial review.
aforementioned statement in L-28196, in his answer in L-28224 the Solicitor General
maintains that this Court has no jurisdiction over the subject-matter of L-28224, upon the Indeed, the power to amend the Constitution or to propose amendments thereto is not
ground that the same is "merely political" as held in Mabanag vs. Lopez Vito.3 Senator included in the general grant of legislative powers to Congress.10 It is part of the inherent
Arturo M. Tolentino, who appeared before the Commission on Elections and filed an powers of the people — as the repository of sovereignty in a republican state, such as
opposition to the PHILCONSA petition therein, was allowed to appear before this Court ours11 — to make, and, hence, to amend their own Fundamental Law. Congress may
and objected to said petition upon the ground: a) that the Court has no jurisdiction either propose amendments to the Constitution merely because the same explicitly grants such
to grant the relief sought in the petition, or to pass upon the legality of the composition of power.12 Hence, when exercising the same, it is said that Senators and Members of the
the House of Representatives; b) that the petition, if granted, would, in effect, render in House of Representatives act, not as members of Congress, but as component elements of
operational the legislative department; and c) that "the failure of Congress to enact a valid a constituent assembly. When acting as such, the members of Congress derive their
reapportionment law . . . does not have the legal effect of rendering illegal the House of authority from the Constitution, unlike the people, when performing the same
Representatives elected thereafter, nor of rendering its acts null and void." function,13 for their authority does not emanate from the Constitution — they are the very
source of all powers of government, including the Constitution itself .
JURISDICTION
Since, when proposing, as a constituent assembly, amendments to the Constitution, the
As early as Angara vs. Electoral Commission,4 this Court — speaking through one of the members of Congress derive their authority from the Fundamental Law, it follows,
leading members of the Constitutional Convention and a respected professor of necessarily, that they do not have the final say on whether or not their acts are within or
Constitutional Law, Dr. Jose P. Laurel — declared that "the judicial department is the only beyond constitutional limits. Otherwise, they could brush aside and set the same at
constitutional organ which can be called upon to determine the proper allocation of naught, contrary to the basic tenet that ours is a government of laws, not of men, and to
powers between the several departments and among the integral or constituent units the rigid nature of our Constitution. Such rigidity is stressed by the fact that, the
thereof." It is true that in Mabanag vs. Lopez Vito,5 this Court characterizing the issue Constitution expressly confers upon the Supreme Court,14 the power to declare a treaty
submitted thereto as a political one, declined to pass upon the question whether or not a unconstitutional,15 despite the eminently political character of treaty-making power.
given number of votes cast in Congress in favor of a proposed amendment to the
Constitution — which was being submitted to the people for ratification — satisfied the In short, the issue whether or not a Resolution of Congress — acting as a constituent
three-fourths vote requirement of the fundamental law. The force of this precedent has assembly — violates the Constitution essentially justiciable, not political, and, hence,
been weakened, however, by Suanes vs. Chief Accountant of the Senate,6 Avelino vs. subject to judicial review, and, to the extent that this view may be inconsistent with the
Cuenco,7 Tañada vs. Cuenco,8 and Macias vs. Commission on Elections.9 In the first, we stand taken in Mabanag vs. Lopez Vito,16 the latter should be deemed modified
held that the officers and employees of the Senate Electoral Tribunal are under its accordingly. The Members of the Court are unanimous on this point.
supervision and control, not of that of the Senate President, as claimed by the latter; in
 50

THE MERITS The first objection is based upon Section 5, Article VI, of the Constitution, which provides:

Section 1 of Article XV of the Constitution, as amended, reads: The House of Representatives shall be composed of not more than one hundred and
twenty Members who shall be apportioned among the several provinces as nearly as may
The Congress in joint session assembled by a vote of three-fourths of all the Members of be according to the number of their respective inhabitants, but each province shall have
the Senate and of the House of Representatives voting separately, may propose at least one Member. The Congress shall by law make an apportionment within three
amendments to this Constitution or call a convention for that purpose. Such amendments years after the return of every enumeration, and not otherwise. Until such apportionment
shall be valid as part of this Constitution when approved by a majority of the votes cast at shall have been made, the House of Representatives shall have the same number of
an election at which the amendments are submitted to the people for their ratification. Members as that fixed by law for the National Assembly, who shall be elected by the
Pursuant to this provision, amendments to the Constitution may be proposed, either by qualified electors from the present Assembly districts. Each representative district shall
Congress, or by a convention called by Congress for that purpose. In either case, the vote comprise, as far as practicable, contiguous and compact territory.
of "three-fourths of all the members of the Senate and of the House of Representatives It is urged that the last enumeration or census took place in 1960; that, no apportionment
voting separately" is necessary. And, "such amendments shall be valid as part of" the having been made within three (3) years thereafter, the Congress of the Philippines
"Constitution when approved by a majority of the votes cast at an election at which the and/or the election of its Members became illegal; that Congress and its Members,
amendments are submitted to the people for their ratification." likewise, became a de facto Congress and/or de facto congressmen, respectively; and that,
In the cases at bar, it is conceded that the R. B. H. Nos. 1 and 3 have been approved by a consequently, the disputed Resolutions, proposing amendments to the Constitution, as
vote of three-fourths of all the members of the Senate and of the House of well as Republic Act No. 4913, are null and void.
Representatives voting separately. This, notwithstanding, it is urged that said resolutions It is not true, however, that Congress has not made an apportionment within three years
are null and void because: after the enumeration or census made in 1960. It did actually pass a bill, which became
1. The Members of Congress, which approved the proposed amendments, as well as the Republic Act No. 3040,17 purporting to make said apportionment. This Act was, however,
resolution calling a convention to propose amendments, are, at best, de declared unconstitutional, upon the ground that the apportionment therein undertaken
facto Congressmen; had not been made according to the number of inhabitants of the different provinces of
the Philippines.18
2. Congress may adopt either one of two alternatives propose — amendments or call a
convention therefore but may not avail of both — that is to say, propose Moreover, we are unable to agree with the theory that, in view of the failure of Congress
amendment and call a convention — at the same time; to make a valid apportionment within the period stated in the Constitution, Congress
became an "unconstitutional Congress" and that, in consequence thereof, the Members
3. The election, in which proposals for amendment to the Constitution shall be submitted of its House of Representatives are de facto officers. The major premise of this process of
for ratification, must be a special election, not a general election, in which officers of the reasoning is that the constitutional provision on "apportionment within three years after
national and local governments — such as the elections scheduled to be held on the return of every enumeration, and not otherwise," is mandatory. The fact that
November 14, 1967 — will be chosen; and Congress is under legal obligation to make said apportionment does not justify, however,
the conclusion that failure to comply with such obligation rendered Congress illegal or
4. The spirit of the Constitution demands that the election, in which proposals for unconstitutional, or that its Members have become de facto officers.
amendment shall be submitted to the people for ratification, must be held under such
conditions — which, allegedly, do not exist — as to give the people a reasonable It is conceded that, since the adoption of the Constitution in 1935, Congress has not made
opportunity to have a fair grasp of the nature and implications of said amendments. a valid apportionment as required in said fundamental law. The effect of this omission has
been envisioned in the Constitution, pursuant to which:
Legality of Congress and Legal Status of the Congressmen
 51

. . . Until such apportionment shall have been made, the House of Representatives shall Petitioners do not allege that the expiration of said three-year period without a
have the same number of Members as that fixed by law for the National Assembly, who reapportionment, had the effect of abrogating or repealing the legal provision creating
shall be elected by the qualified electors from the present Assembly districts. . . . . Congress, or, at least, the House of Representatives, and are not aware of any rule or
principle of law that would warrant such conclusion. Neither do they allege that the term
The provision does not support the view that, upon the expiration of the period to make of office of the members of said House automatically expired or that they ipso
the apportionment, a Congress which fails to make it is dissolved or becomes illegal. On facto forfeited their seats in Congress, upon the lapse of said period for reapportionment.
the contrary, it implies necessarily that Congress shall continue to function with the In fact, neither our political law, nor our law on public officers, in particular, supports the
representative districts existing at the time of the expiration of said period. view that failure to discharge a mandatory duty, whatever it may be, would automatically
It is argued that the above-quoted provision refers only to the elections held in 1935. This result in the forfeiture of an office, in the absence of a statute to this effect.
theory assumes that an apportionment had to be made necessarily before the first Similarly, it would seem obvious that the provision of our Election Law relative to the
elections to be held after the inauguration of the Commonwealth of the Philippines, or in election of Members of Congress in 1965 were not repealed in consequence of the failure
1938.19 The assumption, is, however, unwarranted, for there had been no enumeration in of said body to make an apportionment within three (3) years after the census of 1960.
1935, and nobody could foretell when it would be made. Those who drafted and adopted Inasmuch as the general elections in 1965 were presumably held in conformity with said
the Constitution in 1935 could be certain, therefore, that the three-year period, after the Election Law, and the legal provisions creating Congress — with a House of
earliest possible enumeration, would expire after the elections in 1938. Representatives composed of members elected by qualified voters of representative
What is more, considering that several provisions of the Constitution, particularly those on districts as they existed at the time of said elections — remained in force, we can not see
the legislative department, were amended in 1940, by establishing a bicameral Congress, how said Members of the House of Representatives can be regarded as de facto officers
those who drafted and adopted said amendment, incorporating therein the provision of owing to the failure of their predecessors in office to make a reapportionment within the
the original Constitution regarding the apportionment of the districts for representatives, period aforementioned.
must have known that the three-year period therefor would expire after the elections Upon the other hand, the Constitution authorizes the impeachment of the President, the
scheduled to be held and actually held in 1941. Vice-President, the Justices of the Supreme Court and the Auditor General for, inter alia,
Thus, the events contemporaneous with the framing and ratification of the original culpable violation of the Constitution,20 the enforcement of which is, not only their
Constitution in 1935 and of the amendment thereof in 1940 strongly indicate that the mandatory duty, but also, their main function. This provision indicates that, despite the
provision concerning said apportionment and the effect of the failure to make it were violation of such mandatory duty, the title to their respective offices remains unimpaired,
expected to be applied to conditions obtaining after the elections in 1935 and 1938, and until dismissal or ouster pursuant to a judgment of conviction rendered in accordance
even after subsequent elections. with Article IX of the Constitution. In short, the loss of office or the extinction of title
thereto is not automatic.
Then again, since the report of the Director of the Census on the last enumeration was
submitted to the President on November 30, 1960, it follows that the three-year period to Even if we assumed, however, that the present Members of Congress are merely de
make the apportionment did not expire until 1963, or after the Presidential elections in facto officers, it would not follow that the contested resolutions and Republic Act No.
1961. There can be no question, therefore, that the Senate and the House of 4913 are null and void. In fact, the main reasons for the existence of the de facto doctrine
Representatives organized or constituted on December 30, 1961, were de jure bodies, and is that public interest demands that acts of persons holding, under color of title, an office
that the Members thereof were de jure officers. Pursuant to the theory of petitioners created by a valid statute be, likewise, deemed valid insofar as the public — as
herein, upon expiration of said period of three years, or late in 1963, Congress became distinguished from the officer in question — is concerned.21 Indeed, otherwise, those
illegal and its Members, or at least, those of the House of Representatives, became illegal dealing with officers and employees of the Government would be entitled to demand
holder of their respective offices, and were de facto officers. from them satisfactory proof of their title to the positions they hold, before dealing with
them, or before recognizing their authority or obeying their commands, even if they
 52

should act within the limits of the authority vested in their respective offices, positions or It is, also, noteworthy that R. B. H. Nos. 1 and 3 propose amendments to the constitutional
employments.22 One can imagine this great inconvenience, hardships and evils that would provision on Congress, to be submitted to the people for ratification on November 14,
result in the absence of the de facto doctrine. 1967, whereas R. B. H. No. 2 calls for a convention in 1971, to consider proposals for
amendment to the Constitution, in general. In other words, the subject-matter of R. B. H.
As a consequence, the title of a de facto officer cannot be assailed collaterally.23 It may No. 2 is different from that of R B. H. Nos. 1 and 3. Moreover, the amendments proposed
not be contested except directly, by quo warranto proceedings. Neither may the validity under R. B. H. Nos. 1 and 3, will be submitted for ratification several years before those
of his acts be questioned upon the ground that he is merely a de facto officer.24 And the that may be proposed by the constitutional convention called in R. B. H. No. 2. Again,
reasons are obvious: (1) it would be an indirect inquiry into the title to the office; and (2) although the three (3) resolutions were passed on the same date, they were taken up and
the acts of a de facto officer, if within the competence of his office, are valid, insofar as put to a vote separately, or one after the other. In other words, they were not passed at
the public is concerned. the same time.
It is argued that the foregoing rules do not apply to the cases at bar because the acts In any event, we do not find, either in the Constitution, or in the history thereof anything
therein involved have not been completed and petitioners herein are not third parties. that would negate the authority of different Congresses to approve the contested
This pretense is untenable. It is inconsistent with Tayko vs. Capistrano.25 In that case, one Resolutions, or of the same Congress to pass the same in, different sessions or different
of the parties to a suit being heard before Judge Capistrano objected to his continuing to days of the same congressional session. And, neither has any plausible reason been
hear the case, for the reason that, meanwhile, he had reached the age of retirement. This advanced to justify the denial of authority to adopt said resolutions on the same day.
Court held that the objection could not be entertained, because the Judge was at least,
a de facto Judge, whose title can not be assailed collaterally. It should be noted that Tayko Counsel ask: Since Congress has decided to call a constitutional convention to propose
was not a third party insofar as the Judge was concerned. Tayko was one of the parties in amendments, why not let the whole thing be submitted to said convention, instead of,
the aforementioned suit. Moreover, Judge Capistrano had not, as yet, finished hearing the likewise, proposing some specific amendments, to be submitted for ratification before
case, much less rendered decision therein. No rights had vested in favor of the parties, in said convention is held? The force of this argument must be conceded. but the same
consequence of the acts of said Judge. Yet, Tayko's objection was overruled. Needless to impugns the wisdom of the action taken by Congress, not its authority to take it. One
say, insofar as Congress is concerned, its acts, as regards the Resolutions herein contested seeming purpose thereof to permit Members of Congress to run for election as delegates
and Republic Act No. 4913, are complete. Congress has nothing else to do in connection to the constitutional convention and participate in the proceedings therein, without
therewith. forfeiting their seats in Congress. Whether or not this should be done is a political
question, not subject to review by the courts of justice.
The Court is, also, unanimous in holding that the objection under consideration is
untenable. On this question there is no disagreement among the members of the Court.

Available Alternatives to Congress May Constitutional Amendments Be Submitted for Ratification in a General Election?

Atty. Juan T. David, as amicus curiae, maintains that Congress may either propose Article XV of the Constitution provides:
amendments to the Constitution or call a convention for that purpose, but it can not
do both, at the same time. This theory is based upon the fact that the two (2) alternatives . . . The Congress in joint session assembled, by a vote of three-fourths of all the Members
are connected in the Constitution by the disjunctive "or." Such basis is, however, a weak of the Senate and of the House of Representatives voting separately, may propose
one, in the absence of other circumstances — and none has brought to our attention — amendments to this Constitution or call a contention for that purpose. Such amendments
supporting the conclusion drawn by the amicus curiae. In fact, the term "or" has, shall be valid as part of this Constitution when approved by a majority of the votes cast at
oftentimes, been held to mean "and," or vice-versa, when the spirit or context of the law an election at which the amendments are submitted to the people for their ratification.
warrants it.26
 53

There is in this provision nothing to indicate that the "election" therein referred to is a and can not fairly be deduced from the letter thereof, since the spirit of the law should
"special," not a general, election. The circumstance that three previous amendments to not be a matter of sheer speculation.
the Constitution had been submitted to the people for ratification in special elections
merely shows that Congress deemed it best to do so under the circumstances then The majority view — although the votes in favor thereof are insufficient to declare
obtaining. It does not negate its authority to submit proposed amendments for ratification Republic Act No. 4913 unconstitutional — as ably set forth in the opinion penned by Mr.
in general elections. Justice Sanchez, is, however, otherwise.

It would be better, from the viewpoint of a thorough discussion of the proposed Would the Submission now of the Contested Amendments to the People Violate the Spirit
amendments, that the same be submitted to the people's approval independently of the of the Constitution?
election of public officials. And there is no denying the fact that an adequate appraisal of It should be noted that the contested Resolutions were approved on March 16, 1967, so
the merits and demerits proposed amendments is likely to be overshadowed by the great that, by November 14, 1967, our citizenry shall have had practically eight (8) months to be
attention usually commanded by the choice of personalities involved in general elections, informed on the amendments in question. Then again, Section 2 of Republic Act No. 4913
particularly when provincial and municipal officials are to be chosen. But, then, these provides:
considerations are addressed to the wisdom of holding a plebiscite simultaneously with
the election of public officer. They do not deny the authority of Congress to choose either (1) that "the amendments shall be published in three consecutive issues of the Official
alternative, as implied in the term "election" used, without qualification, in the Gazette, at least twenty days prior to the election;"
abovequoted provision of the Constitution. Such authority becomes even more patent
when we consider: (1) that the term "election," normally refers to the choice or selection (2) that "a printed copy of the proposed amendments shall be posted in a conspicuous
of candidates to public office by popular vote; and (2) that the word used in Article V of place in every municipality, city and provincial office building and in every polling place
the Constitution, concerning the grant of suffrage to women is, not "election," but not later than October 14, 1967," and that said copy "shall remain posted therein until
"plebiscite." after the election;"

Petitioners maintain that the term "election," as used in Section 1 of Art. XV of the (3) that "at least five copies of said amendment shall be kept in each polling place, to be
Constitution, should be construed as meaning a special election. Some members of the made available for examination by the qualified electors during election day;"
Court even feel that said term ("election") refers to a "plebiscite," without any "election," (4) that "when practicable, copies in the principal native languages, as may be determined
general or special, of public officers. They opine that constitutional amendments are, in by the Commission on Elections, shall be kept in each polling place;"
general, if not always, of such important, if not transcendental and vital nature as to
demand that the attention of the people be focused exclusively on the subject-matter (5) that "the Commission on Elections shall make available copies of said amendments in
thereof, so that their votes thereon may reflect no more than their intelligent, impartial English, Spanish and, whenever practicable, in the principal native languages, for free
and considered view on the merits of the proposed amendments, unimpaired, or, at least, distributing:" and
undiluted by extraneous, if not insidious factors, let alone the partisan political
considerations that are likely to affect the selection of elective officials. (6) that the contested Resolutions "shall be printed in full" on the back of the ballots
which shall be used on November 14, 1967.
This, certainly, is a situation to be hoped for. It is a goal the attainment of which should be
promoted. The ideal conditions are, however, one thing. The question whether the We are not prepared to say that the foregoing measures are palpably inadequate to
Constitution forbids the submission of proposals for amendment to the people except comply with the constitutional requirement that proposals for amendment be "submitted
under such conditions, is another thing. Much as the writer and those who concur in this to the people for their ratification," and that said measures are manifestly insufficient,
opinion admire the contrary view, they find themselves unable to subscribe thereto from a constitutional viewpoint, to inform the people of the amendment sought to be
without, in effect, reading into the Constitution what they believe is not written thereon made.
 54

These were substantially the same means availed of to inform the people of the subject said amendments shall be kept in each polling place to be made available for examination
submitted to them for ratification, from the original Constitution down to the Parity by the qualified electors during election day. When practicable, copies in the principal
Amendment. Thus, referring to the original Constitution, Section 1 of Act No. 4200, native languages, as may be determined by the Secretary of the Interior, shall also be kept
provides: therein.

Said Constitution, with the Ordinance appended thereto, shall be published in the Official As regards the Parity Amendment, Section 2 of Republic Act No. 73 is to the effect that:
Gazette, in English and in Spanish, for three consecutive issues at least fifteen days prior
to said election, and a printed copy of said Constitution, with the Ordinance appended The said amendment shall be published in English and Spanish in three consecutive issues
thereto, shall be posted in a conspicuous place in each municipal and provincial of the Official Gazette at least twenty days prior to the election. A printed copy thereof
government office building and in each polling place not later than the twenty-second day shall be posted in a conspicuous place in every municipal, city, and provincial government
of April, nineteen hundred and thirty-five, and shall remain posted therein continually office building and in every polling place not later than February eleven, nineteen hundred
until after the termination of the election. At least ten copies of the Constitution with the and forty-seven, and shall remain posted therein until after the election. At least, ten
Ordinance appended thereto, in English and in Spanish, shall be kept at each polling place copies of the said amendment shall be kept in each polling place to be made available for
available for examination by the qualified electors during election day. Whenever examination by the qualified electors during election day. When practicable, copies in the
practicable, copies in the principal local dialects as may be determined by the Secretary of principal native languages, as may be determined by the Commission on Elections, shall
the Interior shall also be kept in each polling place. also be kept in each polling place.

The provision concerning woman's suffrage is Section 1 of Commonwealth Act No. 34, The main difference between the present situation and that obtaining in connection with
reading: the former proposals does not arise from the law enacted therefor. The difference springs
from the circumstance that the major political parties had taken sides on previous
Said Article V of the Constitution shall be published in the Official Gazette, in English and amendments to the Constitution — except, perhaps, the woman's suffrage — and,
in Spanish, for three consecutive issues at least fifteen days prior to said election, and the consequently, debated thereon at some length before the plebiscite took place. Upon the
said Article V shall be posted in a conspicuous place in each municipal and provincial office other hand, said political parties have not seemingly made an issue on the amendments
building and in each polling place not later than the twenty-second day of April, nineteen now being contested and have, accordingly, refrained from discussing the same in the
and thirty-seven, and shall remain posted therein continually until after the termination of current political campaign. Such debates or polemics as may have taken place — on a
the plebiscite. At least ten copies of said Article V of the Constitution, in English and in rather limited scale — on the latest proposals for amendment, have been due principally
Spanish, shall be kept at each polling place available for examination by the qualified to the initiative of a few civic organizations and some militant members of our citizenry
electors during the plebiscite. Whenever practicable, copies in the principal native who have voiced their opinion thereon. A legislation cannot, however, be nullified by
languages, as may be determined by the Secretary of the Interior, shall also be kept in reason of the failure of certain sectors of the community to discuss it sufficiently. Its
each polling place. constitutionality or unconstitutionality depends upon no other factors than those existing
at the time of the enactment thereof, unaffected by the acts or omissions of law enforcing
Similarly, Section 2, Commonwealth Act No. 517, referring to the 1940 amendments, is of agencies, particularly those that take place subsequently to the passage or approval of the
the following tenor: law.
The said amendments shall be published in English and Spanish in three consecutive issues Referring particularly to the contested proposals for amendment, the sufficiency or
of the Official Gazette at least twenty days prior to the election. A printed copy thereof insufficiency, from a constitutional angle, of the submission thereof for ratification to the
shall be posted in a conspicuous place in every municipal, city, and provincial government people on November 14, 1967, depends — in the view of those who concur in this
office building and in every polling place not later than May eighteen, nineteen hundred opinion, and who, insofar as this phase of the case, constitute the minority — upon
and forty, and shall remain posted therein until after the election. At least ten copies of whether the provisions of Republic Act No. 4913 are such as to fairly apprise the people of
 55

the gist, the main idea or the substance of said proposals, which is — under R. B. H. No. 1 Members of this Court believe, however, said Act and R. B. H. Nos. 1 and 3 violate the
— the increase of the maximum number of seats in the House of Representatives, from spirit of the Constitution.
120 to 180, and — under R. B. H. No. 3 — the authority given to the members of Congress
to run for delegates to the Constitutional Convention and, if elected thereto, to discharge Inasmuch as there are less than eight (8) votes in favor of declaring Republic Act 4913 and
the duties of such delegates, without forfeiting their seats in Congress. We — who R. B. H. Nos. 1 and 3 unconstitutional and invalid, the petitions in these two (2) cases must
constitute the minority — believe that Republic Act No. 4913 satisfies such requirement be, as they are hereby, dismiss and the writs therein prayed for denied, without special
and that said Act is, accordingly, constitutional. pronouncement as to costs. It is so ordered.

A considerable portion of the people may not know how over 160 of the proposed Makalintal and Bengzon, J.P., JJ., concur.
maximum of representative districts are actually apportioned by R. B. H. No. 1 among the Fernando, J., concurs fully with the above opinion, adding a few words on the question of
provinces in the Philippines. It is not improbable, however, that they are not interested in jurisdiction.
the details of the apportionment, or that a careful reading thereof may tend in their
simple minds, to impair a clear vision thereof. Upon the other hand, those who are more
sophisticated, may enlighten themselves sufficiently by reading the copies of the
proposed amendments posted in public places, the copies kept in the polling places and
the text of contested resolutions, as printed in full on the back of the ballots they will use.

It is, likewise, conceivable that as many people, if not more, may fail to realize or envisage
the effect of R. B. H. No. 3 upon the work of the Constitutional Convention or upon the
future of our Republic. But, then, nobody can foretell such effect with certainty. From our
viewpoint, the provisions of Article XV of the Constitution are satisfied so long as the
electorate knows that R. B. H. No. 3 permits Congressmen to retain their seats as
legislators, even if they should run for and assume the functions of delegates to the
Convention.

We are impressed by the factors considered by our distinguished and esteemed brethren,
who opine otherwise, but, we feel that such factors affect the wisdom of Republic Act No.
4913 and that of R. B. H. Nos. 1 and 3, not the authority of Congress to approve the same.

The system of checks and balances underlying the judicial power to strike down acts of
the Executive or of Congress transcending the confines set forth in the fundamental laws
is not in derogation of the principle of separation of powers, pursuant to which each
department is supreme within its own sphere. The determination of the conditions under
which the proposed amendments shall be submitted to the people is concededly a matter
which falls within the legislative sphere. We do not believe it has been satisfactorily
shown that Congress has exceeded the limits thereof in enacting Republic Act No. 4913.
Presumably, it could have done something better to enlighten the people on the subject-
matter thereof. But, then, no law is perfect. No product of human endeavor is beyond
improvement. Otherwise, no legislation would be constitutional and valid. Six (6)
 56

G.R. No. L-30761 July 11, 1973 3 25,000.00 to 31,249.99 132.00 " "
4 20,000.00 to 24,999.99 105.00 " "
THE SAN MIGUEL CORPORATION, petitioner, 5 15.000.00 to 19,999.99 83.00 " "
vs. 6 12.500.00 to 14,999.99 63.00 " "
THE MUNICIPAL COUNCIL, THE MAYOR, and THE MUNICIPAL TREASURER OF THE 7 10,000.00 to 12,499.99 50.00 " "
MUNICIPALITY OF MANDAUE, PROVINCE OF CEBU, respondents. 8 8,750.00 to 9,999.99 42.00 " "
Gadioma and Josue for petitioner. 9 7,500.00 to 8,749.99 37.00 " "
10 6,500.00 to 7,499.99 31.00 " "
Acting City Fiscal Lawrence A. Parawan for respondents. 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 " "
ANTONIO, J.: 14 3,000.00 to 3,749.99 16.00 " "
15 2,500.00 to 2,999.99 13.00 " "
Petition for writ of certiorari to review the judgment of the Court of First Instance of Cebu, 16 2,000.00 to 2,499.99 11.00 " "
in Civil Case No. R-10631, upholding the validity of Ordinance No. 23, series of 1966, as 17 1,750.00 to 1,999.99 9.00 " "
amended by Ordinance No. 25, series of 1967, of the Municipality of Mandaue, Cebu, 18 1,500.00 to 1,749.99 8.00 " "
imposing "a graduated quarterly fixed tax based on the gross value of money or actual 19 1,250.00 to 1,499.99 7.00 " "
market value at the time of removal of the manufactured articles from their factories or 20 Less than P1,250.00 5.00 " "
other manufacture or processing establishments."
The pertinent portion of Section 2 of Ordinance No. 23 which was not amended by
In enacting the said ordinances, the municipal council of Mandaue invoked as basis of its Ordinance No. 25 states:
authority Republic Act No. 2264 (Local Autonomy Act).
Payment of Municipal License Tax. — A fixed tax imposed on this ordinance must first be
The relevant portion of Section 1, Ordinance No. 23 (1966), as amended by Ordinance No. paid before any person can engage in business and is payable for each taxable business; ...
25 (1967), provides as follows:
The graduated fixed tax provided in this ordinance shall be paid at the Office of the
SECTION 1. — Municipal License Tax On Proprietors Or Operators Of ... Breweries, ... Municipal Treasurer quarterly, on or before the twentieth of January, April, July and
Proprietors or operators of ... breweries, ... within the territorial limits of this municipality October; ... . Provided further, That as regards businesses already operating at the time
shall pay a graduated quarterly fixed tax based on the gross value in money or actual this ordinance takes effect, the tax for the initial quarter shall be paid pursuant to the
market value at the time of removal, of the manufactured articles from their factories ... provisions of this ordinance and shall be based on the gross value in money during the
during the preceding quarter in accordance with the following schedules: ...: quarter immediately preceding, ... .

CLASS QUARTERLY LICENSE TAX Within the time fixed for the payment of the license taxes herein imposed, the taxpayers
P160.00 and P0.30 for shall prepare and file with the Municipal Treasurer, a sworn statement of the gross value
QUARTERLY GROSS VALUE each P1,000.00 or in money during the preceding quarter on the basis of which the tax shall be assessed and
fraction thereof in excess collected. ... .

1 P37,500.00 or over of P37,500.00 gross value.

2 P31.250.00 to P37,499.99 P158.00 per quarter
 57

The basic Ordinance was No. 88,1 which took effect on September 25, 1962, but this was providing for a graduated tax based on either "gross output or sales" violates the
amended by Ordinance No. 23 (January 1, 1967), and by Ordinance No. 25 (January 1, prohibition on municipalities against imposing any percentage tax on sales, or other taxes
1968). 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
Petitioner, a domestic corporation engaged in the business of manufacturing beer and taxpayer is required to submit to the municipal treasurer.
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 We are thus confined to the narrow issue of whether or not the challenged ordinance has
January 22, 1968 and P5,171.80 as of July 18, 1968, computed respectively "on the basis transcended the exceptions and limitations imposed by section 2 of Republic Act 2264.
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 Section 2 of the aforecited statute provides:
case of beer at the time of the removal". Provided, That municipalities and municipal districts shall, in no case, impose any
Claiming that it is adversely affected by the ordinance, which in its view was beyond the percentage tax on sales or other taxes in any form based thereon nor impose taxes on
power and authority of the municipality to enact, petitioner brought and action in the articles subject to specific tax ... .
Court of First Instance of Cebu, Branch VI, for the annulment of said ordinance. Section 1 of Ordinance No. 88 of the Municipality of Mandaue, as amended by Ordinances
Petitioner contends that (1) the phrase "gross value in money or actual market value" Nos. 23 (1967) and 25 (1968), specifically provides that the graduated quarterly tax shall
employed in the questioned ordinance clearly referred to "sales or market price" of the be "based on the gross value in money or actual market value at the time of removal, of
articles or commodities manufactured thereby indicating a manifest intent to impose a tax the manufactured products ... from their factories ... during the preceding calendar year ...
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 Well settled is the rule that in the absence of legislative intent to the contrary, technical or
same as imposing a tax upon the product itself. commercial terms and phrases, when used in tax statutes, are presumed to have been
Respondents upon the other hand insist that the tax imposed in the questioned ordinance used in their technical sense or in their trade or commercial meaning. Thus, the phrase
(1) is not a percentage tax or a tax on the sales of beer but is a tax on the privilege to "gross value in money" has a well-defined meaning in our tax statutes. For instance, the
engage in the business of manufacturing beer, and the phrase "actual market value" was term "gross value in money" of articles sold, bartered, exchanged or transferred, as used
merely employed as a basis for the classification and graduation of the tax sought to be in Sections 184, 185 and 186 of the National Internal Revenue Code, has been invariably
imposed; (2) that it is not a specific tax because it is not a tax on the beer itself, but on the used as equivalent to "gross selling price" and has been construed as the total amount of
privilege of manufacturing beer; and (3) that with conversion of Mandaue into a city on money or its equivalent which the purchaser pays to the vendor to receive or get the
June 21, 1969, the appeal has become moot, because the prohibition against the goods.4 It must be noted that the ordinance specifically provides that the basis of the tax
imposition of any privilege tax on sales or other taxes in any form based thereon, is is the "gross value in money or actual market value" of the manufactured article.
applicable only to municipalities. The phrase "actual market value" has been construed as the price which an article "would
While We have heretofore announced the doctrine that the grant of power to tax to command in the ordinary course of business, that is to say, when offered for sale by one
charterred cities and municipalities under Section 2 of the Local Autonomy Act is willing to sell, but not under compulsion to sell, and purchased by another who is willing
sufficiently plenary,2 it is, however, subject to the exceptions and limitations contained in to buy, but under no obligation purchase it,5 or the price which the property will bring in a
the two (2) provisos of the same statute. In other words, the municipal corporation should fair market after fair and reasonable efforts have been made to find a purchaser who will
not transcend the limitations imposed by the statute on the basis of which the power to give the highest price for it.6 The "actual market value" of property, for purposes of
tax is sought to be exercised. Thus, We held in the Marinduque case,3 that an ordinance taxation, therefore means the selling price of the article in the course of ordinary
business.
 58

Considering that the phrase "gross value in money" is followed by the words "or actual Similarly, in the case at bar, the circumstance that the tax is imposed upon petitioner at
market value", it is evident that the latter was intended to explain and clarify the time of removal from the factory of the manufactured beer, and not on the date of actual
preceding phrase. For the word "or" may be used as the equivalent of "that is to say" and sale, is not of important consequence since petitioner will, in the end, sell the beer
gives that which precedes it the same significance as that which follows it. It is not always removed from the factory, because by the nature of its business, it has no alternative but
disjunctive and is sometimes interpretative or expository of the preceding to sell what it has manufactured.
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 We therefore hold that the questioned ordinance imposed tax based on sales and
phrase. In any event, it is the duty of the courts, so far reasonably practicable, to read and therefore beyond the authority of the municipality to enact.
interpret a statute as to give life and effect to its provisions, so as to render it a Having reached this conclusion, it becomes unnecessary to pass upon the additional
harmonious whole. question posed, i.e., whether or not the challenged ordinance imposes a tax on a product
It is also significant to note, that there is a set ratio between the amount of the tax and subject to specific tax.
the volume of sales. Thus if the "gross value in money or actual market value" of the beer Respondents however claim that with the conversion Mandaue into a city pursuant to
removed from the factory exceeds P37,500.00 per quarter, the taxpayer is required to pay Republic Act No. 5519, which was approved on June 21, 1969, the issue has already
a quarterly license tax of P160.00 plus P0.30 for every P1,000.00 or fraction of the excess. become moot, since the prohibition contained in section 2 of Republic Act 2264 applies
In other words in excess of P37,500.00, the taxpayer will pay to the municipality a certain only to municipalities and not to chartered cities. The same contention has been rejected
amount of tax measured by a percentage of the sales. It is therefore evident that the in City of Naga v. Court of Appeals,9 and Laoag Producers' Cooperative Marketing
challenged ordinance was a transparent attempt on the part of the municipality to impose Association, Inc. v. Municipality of Laoag, supra, where We ruled that the legality of an
a tax based on sales. ordinance depends upon the power of the municipality at the time of the enactment the
Although section 2 of the ordinance in question provides in a vague manner that the tax challenged ordinance. Since the municipality of Mandaue had no authority to enact the
shall be assessed and collected on the basis of the sworn statement of the manager of a said ordinance, the subsequent approval of Republic Act No. 5519 which became effective
firm or corporation "of the gross value in money during the preceding quarter," in actual June 21, 1969, did not remove the original infirmity of the ordinance. Indeed there is no
practice the quarterly tax levied upon the petitioner, was computed on the basis of the provision in the aforecited statute which invests a curative effect upon the ordinances of
total market of the beer, per quarter, as shown by the shipping memorandum certified to the municipality which when enacted were beyond its statutory authority.
by the storekeeper of the Bureau Internal Revenue assigned to the brewery. Thus the IN VIEW WHEREOF, the appealed judgment is hereby reversed and Ordinance No. 23,
amounting to P309.40 and P5,171.80, paid by petition January 22, 1968 and July 18, 1968, series of 1966, as amended by Ordinance No. 23, series of 1966, which became effective
were actually determined respectively on the basis of 70,412 and 2,203.070 cases January 1, 1968, of the Municipality of Mandaue, Cebu, is hereby declared null and void.
manufactured and removed from the Mandaue plant, multiplied by P7.60 which is the Respondents are also ordered to refund the taxes paid by Petitioners under the said
prevailing market price (wholesaler's price) per case of beer. ordinance, with legal interest thereon. No costs.
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."
 59

G.R. No. 230249, April 24, 2018 During the preliminary conference on May 5, 2016, the counsels for the parties marked
their respective pieces of evidence. Thereafter, an Order was issued giving them ten (10)
ATTY. PABLO B. FRANCISCO, Petitioner, v. COMMISSION ON ELECTIONS AND ATTY. days to file their respective memoranda. The COMELEC would receive copies of the
JOHNIELLE KEITH P. NIETO, Respondents. memoranda on May 16, 2016 and, thereafter, the case was deemed submitted for
DECISION resolution. In the interim, Nieto would be re-elected as municipal mayor of Cainta, Rizal,
having garnered the plurality of votes upon the conclusion of the 2016 polls.
VELASCO JR., J.:
Ruling of the COMELEC
Nature of the Case

On August 16, 2016, the COMELEC Second Division promulgated a Resolution4 dismissing
This treats of the petition for certiorari under Rule 64, in relation to Rule 65, of the Rules the Petition for Disqualification against Nieto, and ruled in the following wise:
of Court filed by Atty. Pablo B. Francisco (Francisco), which seeks to nullify the February 2,
2017 Resolution1 of the public respondent Commission on Elections (COMELEC) En Banc. From the foregoing, it is clear that a candidate cannot be disqualified without a prior
The assailed ruling dismissed Francisco's Petition for Disqualification against private finding that he or she is suffering from a disqualification provided by law or the
respondent Atty. Johnielle Keith P. Nieto (Nieto). Constitution. To be sure, in order to disqualify a candidate there must be a declaration by
a final judgment of a competent court that the candidate sought to be disqualified is guilty
The Facts of or found by the Commission to be suffering from any disqualification provided by law
or the Constitution.

Francisco is a registered voter in Cainta, Rizal, while Nieto was elected as mayor of the In the instant case, this Commission (Second Division) finds no such prior declaration by a
same municipality in 2013. Nieto filed a certificate of candidacy (COC) to signify his bid for final judgment of a competent court or of a finding of the Commission that Respondent is
re-election for the 2016 National and Local Elections. guilty of the acts complained of Whether or not the Respondent is guilty of the alleged
acts is a prejudicial question which should be determined first in a proper proceedings
On April 8, 2016, Francisco filed before the COMELEC a Petition for Disqualification against (sic) before a tribunal with competent jurisdiction. In the absence of such prior finding of a
Nieto, docketed as SPA 16-062(DC), alleging that on April 1-2, 2016, respondent made competent tribunal, the Commission has no basis to disqualify Respondent. That said, the
financial contributions out of the government coffers for the asphalt-paving of the road case must be dismissed.
entrance along Imelda Avenue of Cainta Green Park Village. This, according to petitioner,
amounted to the expending of public funds within forty-five (45) days before the 2016 WHEREFORE, premises considered, the instant Petition is DISMISSED.
polls and to illegal contributions for road repairs, respectively punishable under Sees.
261(v)2 and 1043 of Batas Pambansa Blg. 881, otherwise known as the Omnibus Election SO ORDERED.5
Code (OEC). Petitioner further claimed that the said asphalt paving was one of the
accomplishments that respondent reported on his Facebook page. The COMELEC Second Division anchored its ruling on the Court's landmark decision in Poe-
Llamanzares v. COMELEC6 (Poe) wherein the Court enunciated thusly:
In his Answer filed on April 22, 2016, Nieto countered that the questioned asphalting
project was subjected to public bidding on March 15, 2016, with a Notice of Award issued Clearly, the amendment done in 2012 is an acceptance of the reality of absence of an
on March 21, 2016. Thus, the asphalting project falls within the excepted public works authorized proceeding for determining before election the qualifications of candidate.
mentioned in Sec. 261(v)(l)(b) of the OEC. Such that, as presently required, to disqualify a candidate there must be a declaration by
a final judgment of a competent court that the candidate sought to be disqualified "is
 60

guilty of or found by the Commission to be suffering from any disqualification provided xxxx
by law or the Constitution."
Consequently, having no leg to stand on, the instant Motion for Reconsideration is
Insofar as the qualification of a candidate is concerned, Rule 25 and Rule 23 are flipsides DENIED and the Resolution of the Commission (Second Division) is hereby AFFIRMED.7
of one to the other. Both do not allow, are not authorizations, are not vestment of
jurisdiction, for the COMELEC to determine the qualification of a candidate. The facts of Hence, the instant recourse.
qualification must beforehand be established in a prior proceeding before an authority The Issues
properly vested with jurisdiction. The prior determination of qualification may be by
statute, by executive order or by a judgment of a competent court or tribunal. (emphasis
added) The issues to be resolved by this Court can be condensed to the following:

On September 8, 2016, petitioner moved for reconsideration from the COMELEC Second I. Whether or not the COMELEC acted in grave abuse of discretion in ruling that a
Division's Resolution before the COMELEC En Banc, arguing in the main that there need petition for disqualification under Sec. 68 of the OEC cannot prosper without a
not be a final judgment by a competent court that the candidate sought to be disqualified prior judgment finding the respondent guilty of an election offense.
is guilty of or is suffering from any disqualification. He also stressed that since the act
complained of can only be committed within forty-five (45) days before the election, it II. Whether or not petitioner sufficiently established by substantial evidence that
would be impossible to secure a conviction prior to initiating the disqualification respondent violated Secs. 261(v) and 104 of the OEC.
proceedings. Petitioner bewails that the COMELEC abruptly dismissed the disqualification case.
According to petitioner, the situation ushered in by the COMELEC ruling would render
Despite these strong asseverations, however, the COMELEC En Banc found no reason to toothless Section 68 of the OEC against election irregularities because of the virtual
disturb the ruling of the Second Division. Instead, the seven-person Commission echoed impossibility of compliance with the prior ruling requirement. He also asserts
the pronouncement that for a petition for disqualification to prosper, there must be "a that Poe does not apply to candidates for local posts.
declaration by a final judgment of a competent court that the candidate sought to be
disqualified is guilty of or found by the Commission to be suffering from any In his Comment, respondent Nieto cited the Poe ruling and averred that since there was
disqualification provided by law or the Constitution." The COMELEC En Banc then deemed no prior declaration by a final judgment of a competent court or of a finding of the
that the denial of the petition is the only course of action it could take under the Commission that he is guilty of the acts complained of, the COMELEC Second Division had
premises. Thus, in its assailed February 2, 2017 Resolution, the electoral tribunal held: no basis to disqualify him. Nieto likens the requirement of a prior ruling to a prejudicial
Although the ruling enunciated by the Supreme Court in [Poe] has effectively emasculated question that must first be determined in a proper proceeding before a tribunal with
the Commission's power under COMELEC Resolution No. 9523 to disqualify a candidate, it competent jurisdiction.
cannot decline to apply such ruling in view of the principle that "judicial decisions applying
or interpreting the laws or the Constitution shall form a part of the legal system of the Moreover, Nieto reiterated the defense that the asphalting project is outside the ambit of
Philippines." the ban against the expenditure of public funds since it was contracted prior to the 45-day
period before the scheduled elections. It was, thus, an infrastructure activity lawfully
As such, Petitioner's reliance on the cases cited in the Motion for Reconsideration is entered into by the local government unit of Cainta. In addition, no public funds were
misplaced, considering that the Poe case is now the controlling doctrine on the matter disbursed for the project during the ban since all expenses were for the account of the
having been decided in 2016 and thus supersedes any previous ruling on the matter. winning bidder, Franzcor Trading and Construction.

The Office of the Solicitor General (OSG), representing the government, in its Comment
 61

took a stance different from that of the COMELEC. The OSG argued that Article IX-C, election controversies. Filing a motion for reconsideration before the COMELEC then
Section 2(2) and (3) of the Constitution granted the COMELEC the quasi-judicial power to almost guarantees that the full 30-day period could not be availed of.
decide all questions affecting elections, except those involving the right to vote. This
power further finds legal mooring in the dual aspect of the prohibited acts constituting the In the case at bar, petitioner failed to indicate when he received a copy of the August 16,
grounds for disqualification under Section 68 of the OEC. Lastly, the OSG posited that the 2016 Resolution of the COMELEC Second Division, from which he moved for
context of the Poe ruling bars its application to local elective officials since the discussions reconsideration on September 8, 2016. The Court is then unable to determine how many
were aptly made within the confines of a national candidate for the presidency. days should be deducted from his period for filing a Rule 64 petition and, consequently, if
the instant recourse had been filed on time. The particular date of receipt is of utmost
The Court's Ruling significance in this case since petitioner cannot deny that he availed of the full 30-day
period from February 20, 2017 to March 22, 2017. This means that unless petitioner filed
Petitioner is correct in his contention that a prior judgment is not a precondition to filing a his motion for reconsideration on the very same day he received the COMELEC's August
Petition for Disqualification. Nevertheless, the petition must necessarily fail for lack of 16, 2016 Resolution, the instant petition had been filed out of time. In any case, non-
substantial evidence to establish that private respondent committed an election offense. compliance with the material date rule, in itself, is already a ground for dismissal.11

Petitioner failed to comply with the material date rule Revisiting Poe and strengthening the jurisdiction of the COMELEC

Before We discuss the merits of the case, the Court observes that petitioner failed to state Public respondent COMELEC relied heavily on the Court's pronouncement in Poe when it
the material dates to establish that the instant recourse was timely interposed. The dismissed the election controversy. The Court, however, takes this opportunity to rectify
petitioner merely stated that he received a copy of the COMELEC's Resolution denying his Our position in Poe and to uphold the jurisdiction of the COMELEC as strengthened under
motion for reconsideration on February 20, 2017, and that he was filing this petition the present Constitution.
within thirty (30) days from the said date on March 22, 2017.8
For perspective, the COMELEC was never part of the original version of the 1935
The allegation is not sufficient. Rule 64, Section 3 of the Rules of Court prescribes the Constitution. Prior to its creation, it was the then Department of Interior, through an
period for elevating the COMELEC's ruling to this Court thusly: Executive Bureau then directly, that superintended the conduct of elections.12 The Courts
were charged with resolving questions affecting the right to vote as well as contested
Section 3. Time to file petition. - The petition shall be filed within thirty (30) days from elections of local elective officials, while the Secretary of Interior was vested with the
notice of the judgment or final order or resolution sought to be reviewed. The filing of a authority to enforce the election laws and assign local authorities to perform ministerial
motion for new trial or reconsideration of said judgment or final order or resolution, if duties relative thereto.
allowed under the procedural rules of the Commission concerned, shall interrupt the
period herein fixed. If the motion is denied, the aggrieved party may file the petition The close official relationship between the President and the Secretary of Interior,
within the remaining period, but which shall not be less than five (5) days in any event, however, aroused suspicion that the latter had been administering election statutes not
reckoned from notice of denial. for the purpose of securing honest and free elections, but to serve the political interest of
the party in power to which they belonged. They were never entirely free from suspicion
Clear from the provision is that the intervening period petitioner utilized in moving for of acting with partisan bias. And this general dissatisfaction and distrust over the manner
reconsideration before the COMELEC must be deducted from the thirty (30)-day period the elections were conducted at that time impelled the National Assembly to propose the
for resorting to a Rule 64 petition. As held in Pates v. COMELEC,9 the fresh period rule creation of the COMELEC by constitutional amendment.13
in Neypes v. Court of Appeals10 that resets the period of the fi1ing of an appeal from the
date of receipt of the ruling on reconsideration is applicable only in civil cases, not in Through a plebiscite held on June 17, 1940, several amendments were introduced to the
 62

1935 Constitution: modifying the term of office of the President and the Vice-President
from six (6) years to four (4) years, but with re-election for another term establishing a (2) Be the sole judge of all contests relating to the elections, returns, and qualifications
bicameral Congress composed of the Senate as the upper house and the House of of all Members of the Batasang Pambansa and elective provincial and city officials.
Representatives as the lower house; and creating an independent COMELEC.
(3) Decide, save those involving the right to vote, administrative questions affecting
Since its creation, the COMELEC's power had been increased in each incarnation of the elections, including the determination of the number and location of polling places, the
Constitution to reflect the country's awareness of the need to provide greater regulation appointment of election officials and inspectors, and the registration of voters.
and protection to our electoral processes and to ensure their integrity.14 To demonstrate,
Article X, Section 2 of the 1935 Constitution, as amended, declares the power of the (4) Deputize, with the consent or at the instance of the President, law enforcement
electoral commission thusly: agencies and instrumentalities of the Government, including the armed forces of the
Philippines, for the purpose of ensuring free, orderly, and honest elections.
Section 2. The Commission on Elections shall have exclusive charge of the enforcement
and administration of all laws relative to the conduct of elections and shall exercise all (5) Register and accredit political parties subject to the provisions of Section eight hereof
other functions which may be conferred upon it by law. It shall decide, save those
involving the right to vote, all administrative questions affecting elections, including the (6) Recommend to the Batasang Pambansa effective measures to minimize election
determination of the number and location of polling places, and the appointment of expenses and prohibit all forms of election frauds and malpractices, political opportunism,
election inspectors and of other election officials. All law enforcement agencies and guest or nuisance candidacy, or other similar acts.
instrumentalities of the Government, when so required by the Commission, shall act as its
deputies for the purpose of insuring free, orderly, and honest election. The decisions, (7) Submit to the President, the Prime Minister, and the Batasang Pambansa a report on
orders, and rulings of the Commission shall be subject to review by the Supreme Court. the conduct and manner of each election.

No pardon, parole. or suspension of sentence for the violation of any election law may be (8) Perform such other functions as may be provided by law. (emphasis added)
granted without the favorable recommendation of the Commission. (emphasis added)
As aptly observed in Mendoza v. COMELEC (Mendoza),15 these powers of the COMELEC
Thus, the administrative control over the conduct of elections erstwhile exercised by the have been enhanced in scope and details under the 1987 Constitution. Article X (C),
Secretary of Interior was shifted to the COMELEC. Under its constitutional mandate, it was Section 2 of the Constitution embodies the myriad of powers bestowed upon the polling
tasked with "the enforcement and administration of all laws relative to the conduct of body, viz:
elections" and bestowed the power to "decide save those involving the right to vole, all
administrative questions affecting elections." But since its authority to decide was SECTION 2. The Commission on Elections shall exercise the following powers and
circumscribed to administrative questions, the courts retained their original powers over functions:
local election contests.
(1) Enforce and administer all laws and regulations relative to the conduct of an election,
It was not until the enactment of the 1973 Constitution when the power of the COMELEC plebiscite, initiative, referendum, and recall.
to resolve election controversies was institutionalized. Through Article XII (C), Section 2 of
the 1973 Constitution. the powers of the COMELEC were expanded to the following: (2) Exercise exclusive original jurisdiction over all contests relating to the elections,
returns, and qualifications of all elective regional, provincial, and city officials, and
SEC. 2. The Commission on Elections shall have the following powers and functions: appellate jurisdiction over all contests involving elective municipal officials decided by trial
courts of general jurisdiction, or involving elective barangay officials decided by trial
(1) Enforce and administer all laws relative to the conduct of elections.
 63

courts of limited jurisdiction. disobedience to its directive, order, or decision.

Decisions, final orders, or rulings of the Commission on election contests involving elective (9) Submit to the President and the Congress a com prehensive report on the conduct of
municipal and barangay offices shall be final, executory, and not appealable. each election, plebiscite, initiative, referendum, or recall. (emphasis added)

(3) Decide, except those involving the right to vote, all questions affecting elections, Significantly, the present Constitution clarifies that the COMELEC retains its character as
including determination of the number and location of polling places, appointment of an administrative agency notwithstanding its authority to resolve election contests. As
election officials and inspectors, and registration of voters. held in Mendoza:

As will be seen on close examination, the 1973 Constitution used the unique wording that
(4) Deputize, with the concurrence of the President, law enforcement agencies and the COMELEC shall be the sole judge of all contests, thus giving the appearance that
instrumentalities of the Government, including the Armed Forces of the Philippines, for judicial power had been conferred. This phraseology, however, was changed in the 1987
the exclusive purpose of ensuring free, orderly, honest, peaceful, and credible elections. Constitution to give the COMELEC exclusive jurisdiction over all contests, thus removing
any vestige of exercising its adjudicatory power as a court and correctly aligning it with
(5) Register, after sufficient publication, political parties, organizations, or coalitions what it is a quasi-judicial body.16
which, in addition to other requirements, must present their platform or program of
government and accredit citizens' arms of the Commission on Elections. Religious As enunciated, the COMELEC's adjudicative function over election contests is quasi-judicial
denominations and sects shall not be registered. Those which seek to achieve their goals in character since the COMELEC is a governmental body, other than a court, that is vested
through violence or unlawful means, or refuse to uphold and adhere to this Constitution, with jurisdiction to decide the specific class of controversies it Is charged with resolving. In
or which are supported by any foreign government shall likewise be refused registration. adjudicating the rights of persons before it, the COMELEC is not just empowered but is in
fact required to investigate facts or ascertain the existence of facts, hold hearings, weigh
Financial contributions from foreign governments and their agencies to political parties, evidence, and draw conclusions from them as basis for their official action and exercise of
organizations, coalitions, or candidates related to elections constitute interference in discretion in a judicial nature.17 This is simply in congruence with the concept of due
national affairs, and, when accepted, shall be an additional ground for the cancellation of process that all administrative adjudicatory bodies are enjoined to observe.
their registration with the Commission, in addition to other penalties that may be
prescribed by law. The COMELEC is, thus, fully-clothed with authority to make factual determinations in
relation to the election contests before it. This has been the thrust of the decades worth
(6) File, upon a verified complaint, or on its own initiative, petitions in court for inclusion of constitutional revisions that transformed the COMELEC from a purely administrative
or exclusion of voters; investigate and, where appropriate, prosecute cases of violations of body, whose scope of decision making is limited to those incidental to its duty to enforce
election laws, including acts or omissions constituting election frauds, offenses, and election laws, to a polling commission that also exercises original and exclusive, as well as
malpractices. appellate, jurisdiction over election contests.

(7) Recommend to the Congress effective measures to minimize election spending, Considering the historical evolution of the COMELEC, the Court now declares that the
including limitation of places where propaganda materials shall be posted, and to prevent polling body has full adjudicatory powers to resolve election contests outside the
and penalize all forms of election frauds, offenses, malpractices, and nuisance jurisdiction of the electoral tribunals. To rule otherwise would be an act of regression,
candidacies. contrary to the intent behind the constitutional innovations creating and further
strengthening the Commission. There is no novelty in this pronouncement, but merely a
(8) Recommend to the President the removal of any officer or employee it has deputized, reinstatement of Our consistent jurisprudence prior to Poe.
or the imposition of any other disciplinary action, for violation or disregard of, or
 64

In the landmark case of Aratea v. COMELEC,18 for instance, the COC of Romeo D. COC can be measured. But lest it be misunderstood, these disquisitions will not by any
Lonzanida was cancelled and declared void ab initio because of his misrepresentation as means alter the outcome of Poe, for even if We dispense the requirement of a predicate
to his eligibility. He knew fully well that he had been elected, and had served, as mayor of judgment therein and uphold the jurisdiction of the COMELEC, the Court's conclusion
San Antonio, Zambales for more than three consecutive terms yet he still certified that he would still find mooring on the factual findings on Poe's Filipino blood relation and
was eligible to run for mayor for the next succeeding term, thus constituting false material residency.22
representation. No prior judgment recognizing Lonzanida's service for three terms was
necessary to effect the cancellation of his COC. A predicate judgment is not required in Petitions for Disqualification

In Maquiling v. COMELEC,19 Linog G. Balua, through a petitiOn treated as one for Moreover, the Commission gravely abused its discretion when it failed to appreciate the
cancellation and/or denial of due course of COC, contended that Rommel Arnado is not a characteristics that distinguish Poe from the case at bar. It must be stressed that there is a
resident of Kauswagan, Lanao del Norte and that the latter is a foreigner based on a world of difference between the remedies availed of in Poe and in the instant case. What
certification by the Bureau of Immigration indicating that Amado is American. The Court is involved herein is a Petition for Disqualification under Sec. 68 of the OEC,
did not find issue in the COMELEC's authority to make a factual determination as to whereas Poe was initiated by multiple Petitions to Deny Due Course or Cancel COC under
Amado's citizenship and residence, though We eventually reversed the COMELEC En Sec. 78 of the OEC.23
Banc's ruling and reinstated that of its First Division based on Our own appreciation of the
evidence on record. The statutory bases for the two distinct remedies read:

And in Cerafica v. COMELEC (Cerafica),20 the Court reversed the COMELEC's mling not Sec. 68. Disqualifications. - Any candidate who, in an action or protest in which he is a
because of any alleged lack of authority to make factual determinations as to the eligibility party is declared by final decision of a competent court guilty of, or found by the
of a candidate, but, quite the contrary, because it did not make use of the same authority. Commission of having

To reiterate, the COMELEC, as an adjunct to its adjudicatory power. may investigate facts xxxx
or ascertain the existence of facts, hold hearings. weigh evidence, and draw conclusions
from them as basis for their official action. As held in Cerafica:21 d. solicited, received or made any contribution prohibited under Sections 89, 95,
96, 97 and 104; or
The determination of whether a candidate is eligible for the position he is seeking involves
a determination of fact where parties must be allowed to adduce evidence in support of
their contentions. We thus caution the Comelec against its practice of impetuous
cancellation of COCs via minute resolutions adopting the recommendations of its Law
Department when the situation properly calls for the case's referral to a Division for
e. violated any of Sections 80, 83, 85, 86 and 261, paragraphs d, e, k, v, and cc,
summary hearing.
subparagraph 6, shall be disqualified from continuing as a candidate, or if he has
It may be true that the sole ground for Petitions to Deny Due Course or to Cancel COC is been elected, from holding the office. x x x
false material representation compounded by intent to deceive on the part of the
candidate and that the intent to deceive or mislead will be difficult, if not impossible, to
ascertain absent an established fact that the candidate deviated from. Contrary to Poe, xxxx
the Court categorical1y rules herein that the COMELEC can be the proper body to make
the pronouncement against which the truth or falsity of a material representation in a Sec. 78. Petition to deny due course to or cancel a certificate of candidacy. - A verified
 65

petition seeking to deny due course or to cancel a certificate of candidacy may be filed by cases, substantial evidence. This is defined as such relevant evidence as a reasonable mind
the person exclusively on the ground that any material representation contained therein will accept as adequate to support a conclusion.29 To impose prior conviction of an
as required under Section 74 hereof is false. The petition may be filed at any time not election offense as a condition sine qua non before a Petition for Disqualification can be
later than twenty-five days from the time of the filing of the certificate of candidacy and launched would be tantamount to requiring proof beyond reasonable doubt, which is
shall be decided, after due notice and hearing, not later than fifteen days before the significantly beyond what our laws require.
election. (emphasis added)
Jurisprudence is rife with teachings on the separability of the criminal prosecution for
The essence of a disqualification proceeding that invokes Sec. 68 of the OEC is to bar an election offenses or even t he determination for probable cause to criminally charge a
individual from becoming a candidate or from continuing as a candidate for public office candidate for any election violation, from the administrative proceeding for
based not on the candidate's lack of qualification, but on his possession of a disqualification. The Court even elucidated on the concept of this twin aspect in the case
disqualification as declared by a final decision of a competent court, or as found by the of Ejercito v. COMELEC,30 viz:
Commission.24 The jurisdiction of the COMELEC to disqualify candidates is limited to those
enumerated in Section 68 of the OEC. All other election offenses are beyond the ambit of x x x It has been repeatedly underscored that an election offense has its criminal and
COMELEC jurisdiction.25 electoral aspects. While its criminal aspect to determine the guilt or innocence of the
accused cannot be the subject of summary hearing, its electoral aspect to ascertain
Meanwhile, for a Petition to Deny Due Course or to Cancel COC under Sec. 78 of the OEC whether the offender should be disqualified from office can be determined in an
to prosper, the candidate must have made a material misrepresentation involving his administrative proceeding that is summary in character. This Court said in Sunga [v.
eligibility or qualification for the office to which he seeks election, such as the requisite COMELEC]:
residency, age, citizenship or any other legal qualification necessary to run for elective
office26 enumerated under Sec. 74 of the OEC.27 Moreover, the false representation under It is worth to note that an election offense has criminal as well as electoral aspects. Its
Sec. 78 must consist of a deliberate attempt to mislead, misinform, or hide a fact which criminal aspect involves the ascertainment of the guilt or innocence of the accused
would otherwise render a candidate ineligible.28 The relief is granted not because of the candidate. Like in any other criminal case, it usually entails a full-blown hearing and the
candidate's lack of eligibility per se, but because of his or her false misrepresentation of quantum of proof required to secure a conviction is beyond reasonable doubt. Its
possessing the statutory qualifications. electoral aspect, on the other hand, is a determination of whether the offender should be
disqualified from office. This is done through an administrative proceeding which is
The doctrine in Poe was never meant to apply to Petitions for Disqualification. A prior summary in character and requires only a clear preponderance of evidence. Thus, under
court judgment is not required before the remedy under Sec. 68 of the OEC can prosper. Sec. 4 of the COMELEC Rules of Procedure, petitions for disqualification "shall be heard
This is highlighted by the provision itself, which contemplates of two scenarios: first, summarily after due notice." It is the electoral aspect that we are more concerned with,
there is a final decision by a competent court that the candidate is guilty of an election under which an erring candidate may be disqualified even without prior criminal
offense and second, it is the Commission itself that found that the candidate committed conviction.
any of the enumerated prohibited acts. Noteworthy is that in the second scenario, it is
not required that there be a prior final judgment; it is sufficient that the Commission and equally in Lanot [v. COMELEC]:
itself made the determination. The conjunction "or" separating "competent court" and
"the Commission" could only mean that the legislative intent was for bot/1 bodies to be x x x The electoral aspect of a disqualification case determines whether the offender
clothed with authority to ascertain whether or not there is evidence that the should be disqualified from being a candidate or from holding office. Proceedings are
respondent candidate ought to be disqualified. summary in character and require only clear preponderance of evidence. An erring
candidate may be disqualified even without prior determination of probable cause in a
Furthermore, the quantum of proof necessary in election cases is, as in all administrative preliminary investigation. The electoral aspect may proceed independently of the
 66

criminal aspect, and vice-versa. with preliminary investigation. Lanot highlighted the inconsistency by citing the teaching
in Sunga that:
The criminal aspect of a disqualification case determines whether there is probable cause
to charge a candidate for an election offense. The prosecutor is the COMELEC, through its A candidate guilty of election offenses would be undeservedly rewarded, instead of
Law Department, which determines whether probable cause exists. If there is probable punished, by the dismissal of the disqualification case against him simply because the
cause, the COMELEC, through its Law Department, files the criminal information before investigating body was unable, for any reason caused upon it, to determine before the
the proper court. Proceedings before the proper court demand a full-blown hearing and election if the offenses were indeed committed by the candidate sought to be
require proof beyond reasonable doubt to convict. A criminal conviction shall result in the disqualified. All that the erring aspirant would need to do is to employ delaying tactics so
disqualification of the offender, which may even include disqualification from holding a that the disqualification case based on the commission of election offenses would not be
future public office. decided before the election. This scenario is productive of more fraud which certainly is
not the main intent and purpose of the law.33
The Court's disquisitions in Sunga v. COMELEC31 and Lanot v. COMELEC32 centered on
whether or not the polling body has the discretion to proceed with disqualification cases To then avoid the above-illustrated deleterious scenario, the Court instructed that the
even after the elections had been concluded. COMELEC should continue the trial and hearing of the disqualification case until judgment
is rendered thereon, and to treat the criminal aspect of the case as a separate issue
In Sunga, petitioner Manuel C. Sunga was a mayoralty candidate in the Municipality of altogether.
Iguig, Cagayan in the May 1995 Elections. He filed a complaint accusing respondent, then
incumbent mayor Ferdinand B. Trinidad, of using threats, intimidation, terrorism or other The distinction between the electoral aspect from the criminal one was further amplified
forms of coercion, in violation of the OEC. The COMELEC denied the complaint, ruling that in Ejercito. There, the Court rebuked therein petitioner's assertion that the conduct of
petitions for disqualification filed after the conduct of the elections ought to be dismissed. preliminary investigation to determine whether the acts enumerated under Section 68 of
In reversing the ruling of the tribunal, the Court held that neither the conclusion of the the OEC were indeed committed is a requirement prior to actual disqualification.
elections nor Trinidad's proclamation and assumption of office divested the COMELEC of Resultantly, the Court upheld the COMELEC's disqualification of petitioner Emilio Ramon
authority and jurisdiction to decide the disqualification case. Ejercito even though there has yet to be any finding of probable cause, let alone guilt, that
he spent more than the threshold amount prescribed under Sections I00-103 of the OEC,
Meanwhile, in Lanot, therein petitioners led by Henry P. Lanot filed a Petition for an election offense under Section 262 of the same code.
Disqualification against then incumbent Pasig City Mayor Vicente P. Eusebio for allegedly
violating Section 261(a) of the OEC on the prohibition against vote-buying. The COMELEC Neither a prior conviction nor even a determination of probable cause is then a
First Division granted the petition, prompting Eusebio to move for reconsideration. At the requirement before a Petition for Disqualification can be lodged. Credit must be given to
time of the elections, the disqualification case was not yet resolved with finality. Thus, petitioner for his apt observation that to rule otherwise would render inutile the remedy
Eusebio's votes were still counted and canvassed, and he was proclaimed city mayor of under Section 68 of the OEC insofar as the specific ground raised herein is concerned.
Pasig. Thereafter, the COMELEC En Banc annulled the COMELEC First Division's Pertinently, Section 261(v) of the OEC and Rule 25, Section 3 of the COMELEC Rules of
disqualification order and referred the case to the COMELEC Law Department for Procedure read:
preliminary investigation. Section 261. Prohibited Acts. - The following shall be guilty of an election offense:

The Court agreed with Lanot that the COMELEC En Banc gravely abused its discretion xxxx
when it ordered the dismissal of the disqualification case because of Eusebio's
proclamation as city mayor and at the same time allowed the criminal aspect to proceed (v) Prohibition against release, disbursement or expenditure of public funds. - Any public
official or employee including barangay officials and those of government-owned or
 67

controlled corporations and their subsidiaries, who, during forty-five days before a government funds during the election ban, a burden that Francisco failed to discharge.
regular election and thirty days before a special election, releases, disburses or expends
any public funds x x x (emphasis added) There is simply a dearth of evidence to support petitioner's claim that respondent violated
Sec. 261(v) of the OEC. To be sure, petitioner merely submitted the following to support
Rule 25 - Disqualification of Candidates his allegations:

1. Pictures of the asphalt-paving along Imelda Avenue of Cainta Green Park Village,
xxxx Barangay San Isidro, Cainta, Rizal;

Section 3. Period to File Petition. - The Petition shall be filed any day after the last day for 2. Picture of the Facebook page of the respondent acknowledging the project as
filing of certificates of candidacy, but not later than the date of proclamation. (emphasis one of the accomplishments of his administration; and
added)
3. Picture of a tarpaulin banner expressing gratitude for the asphalt-paving.
Clearly, the particular election offense and ground for disqualification imputed on
respondent must necessarily be committed within forty-five (45) days before a regular The photographs36 petitioner presented depicting the construction and works done on the
election and within thirty (30) days before a special election. Meanwhile, the window for asphalting project would only prove the fact of paving, which is not even contested. They
filing a Petition for Disqualification raising the same ground is between the day after the do not, however, establish that respondent expended public funds or made financial
filing of a certificate of candidacy until the date of proclamation, which in the advent of contributions during the election prohibition.
automated elections could only take less than a week for local posts. Through its ruling,
the COMELEC then effectively required petitioner to secure against Nieto a final judgment On the other hand, respondent Nieto sufficiently parried the alleged commission of the
of guilt within the very limited timeframe, an almost impossible feat under the normal election offenses by proving that the asphalting project squarely falls under the exception
course of legal procedure. in Sec. 261 (v)(l)(b). The provision states:

We are, therefore, constrained to rule that the COMELEC erred when, relying on Poe, it v. Prohibition against release, disbursement or expenditure of public funds.
imposed the requirement of a prior court judgment before resolving the current - Any public official or employee including barangay officials and those of
controversy. government-owned or controlled corporations and their subsidiaries,
who, during forty-five days before a regular election and thirty days before a
The records are bereft of evidence to hold that respondent violated Secs. 261(v) and 104 special election, releases, disburses or expends any public funds for:
of the Omnibus Election Code

Notwithstanding the COMELEC's error in applying Poe, the petition must nevertheless fail.
Though the COMELEC can properly take cognizance of the Petition for Disqualification
without issue, petitioner miserably failed to tender evidence that respondent committed 1. Any and all kinds of public works, except the following:
the election offenses imputed.

The quantum of proof necessary in election cases is substantial evidence, or such relevant
evidence as a reasonable mind will accept as adequate to support a
conclusion.34 Corollarily, the rule is that he who alleges must prove.35 Thus, the burden is
on Francisco to establish through substantial evidence that Nieto unlawfully disbursed
 68

4. A letter40 dated March 21, 2016 filed by respondent Nieto with the Acting
xxxx
Regional Election Director of COMELEC in Region IV-A submitting to the
Commission the list of the infrastructure projects bid out, including the
asphalting project, which were awarded before March 25, 2016, the reckoning
date of the forty-five day prohibition period and

b. Work undertaken by contract through public 5. A certification41 from the Election Officer of the COMELEC Region IV-A office
bidding held, or by negotiated contract acknowledging receipt of the letter.
awarded, before the forty-five day period
before election: Provided, That work for the To cast doubt on the sufficiency of respondent Nieto's evidence, petitioner Francisco
purpose of this section undertaken under the points out that the followin g were never offered in evidence: (a) an ordinance enacted by
so-called "takay" or "paquiao" system shall the Sangguniang Bayan of Cainta authorizing the P6,000,000.00 expenditure for the
not be considered as work by contract; project, (b) a certification from the proper accounting official that there is an
(emphasis added) appropriation by law of such am ou nt and that the fund is available, and (c) an affidavit
from the editor or publisher of a newspaper of general circulation that the Invitation to
Bid had been published. However, petitioner is not excused from shifting the burden of
The Court is in concurrence with the observations of Commissioners Luie Tito F. Guia and proof to private respondent, especially since the latter has the presumption of regularity
Ma. Rowena Amelia V. Guanzon that the evidence on record sufficiently proved that the in his favor.42 bolstered by evidence proving that the project was contracted outside the
expenditure for the road repair is exempted from the prohibition under Sec. 261(v) of the period of prohibition.
OEC. Private respondent Nieto was able to show with competent evidence that the
bidding for and the award of the subject project were regular and done consistent with There being substantial evidence to support Nieto's defense that the construction
existing laws. The charge for illegal contribution under Sec. 104 of the OEC has even less procurement for t he project was aboveboard, there is then no reason to disturb public
leg to stand on. There was no contribution to speak of since it was established that the respondent's rulings. No abuse of discretion, let alone one that is grave, can be attributed
asphalting work was a government project and not a contribution. to the COMELEC Second Division in dismissing the Petition for Disqualification, nor to the
COMELEC En Banc in denying petitioner's motion for reconsideration.
Notably, private respondent adduced the following pieces of evidence to support his
contention: WHEREFORE, premises considered, the instant petition is DISMISSED for lack of
1. A copy of the posting of the project in the Philippine Government Electronic merit. The Court declares that in a Petition for Disqualification under Section 68 of the
Procurement System (PHILGEPS) website.37 This indicates that the Bid Notice Omnibus Election Code, a prior judgment by a competent court that the candidate is
Abstract and Invitation to Bid for the subject project were posted on the website guilty of an election offense is not required before the said petition can be entertained
on February 25, 2016; or given due course by the Commission on Elections.

2. A certified true copy of the Abstract of Bids38 attested by the members of the SO ORDERED.
Bids and Awards Committee, indicating that the bidding for the asphalting
project was held on March 15, 2016;

3. A certified true copy of the Notice of Award39 stating that, on March 21, 2016,
the project was awarded in favor of the winning bidder, contractor Franzcor
Trading and Construction;
 69

question is submitted for settlement through arbitration. GC-61 also provided that
disputes arising out of the execution of the work should first be submitted to LICOMCEN
for resolution, whose decision shall be final and binding, if not contested within thirty (30)
G.R. No. 167022 August 31, 2007 days from receipt. Otherwise, the dispute shall be submitted to the Construction Industry
Arbitration Commission (CIAC) for arbitration.
LICOMCEN INCORPORATED, Petitioner,
vs. Upon receipt of the notice to proceed, FSI commenced work and undertook to complete it
FOUNDATION SPECIALISTS, INC., Respondent. within ninety (90) days, all in accordance with the approved drawing, plans, and
specifications.
x - - - - - - - - - - - - - - - - - - - - - - -x
In the course of the construction, LICOMCEN revised the design for the CITIMALL involving
G.R. No. 169678 changes in the bored piles and substantial reduction in number and length of the piles.
ESCA, thus, informed FSI of the major revision on December 16, 19976 and ordered the
FOUNDATION SPECIALISTS, INC., Petitioner, non-delivery of the steel bars, pending approval of the new design. FSI, however,
vs. responded that the steel bars had already been loaded and shipped out of Manila. ESCA
LICOMCEN INCORPORATED and COURT OF APPEALS, Respondents. then suggested the delivery of 50% of the steel bars to the jobsite and the return of the
D E C I S I ON other 50% to Manila, where storage and security were better.7

NACHURA, J.: On January 15, 1998, LICOMCEN sent another letter to FSI ordering all the construction
activities suspended, because Albay Accredited Constructions Association (AACA) had
For review in these consolidated petitions is the November 23, 2004 Decision1 of the contested the award of the Contract of Lease to LICOMCEN and filed criminal complaints
Court of Appeals (CA) in CA-G.R. SP. No. 78218, as well as the Resolutions dated February with the Office of the Ombudsman for violation of the Anti-Graft and Corrupt Practices
4, 20052 and September 13, 2005,3 denying the motions for its reconsideration. Act against LICOMCEN and the City Government of Legaspi. Thus, pending a clear
resolution of the case, LICOMCEN decided to suspend all construction activities. It also
Liberty Commercial Center, Inc. (LICOMCEN) is a corporation engaged in the business of requested FSI not to unload the steel bars.8
operating shopping malls. In March 1997, the City Government of Legaspi leased its lot in
the Central District of Legaspi to LICOMCEN. The Lease Contract was based on the Build- On January 17, 1998, the steel bars for the CITIMALL arrived at the Legaspi port, and
Operate-Transfer Scheme under which LICOMCEN will finance, develop and construct the despite LICOMCEN’s previous request, these were unloaded and delivered to the jobsite
LCC City Mall (CITIMALL). LICOMCEN engaged E.S. De Castro and Associates (ESCA) as its and some to Tuanzon compound,9 FSI’s batching site. Then, on January 19, 1998,
engineering consultant for the project. LICOMCEN reiterated its decision to suspend construction, and ordered demobilization of
the materials and equipment for the project.10 Finally, on February 17, 1998, LICOMCEN
On September 1, 1997, LICOMCEN and Foundation Specialist, Inc. (FSI) signed a indefinitely suspended the project, due to the pending cases in the Ombudsman. 11
Construction Agreement for the bored pile foundation of CITIMALL.4 Forming part of the
agreement were the Bid Documents and the General Conditions of Contract FSI demanded payment for its work accomplishments, material costs, and standby off
(GCC)5 prepared by ESCA. A salient provision of the GCC is the authority granted the equipment, as well as other expenses amounting to ₱22,667,026.97,12 but LICOMCEN
engineering consultant to suspend the work, wholly or partly. LICOMCEN was also given took no heed.
the right to suspend the work or terminate the contract. Among other caveats, GC-05
provided that questions arising out or in connection with the contract or its breach should On October 12, 1998, the Ombudsman dismissed the cases filed against the City
be litigated in the courts of Legaspi, except where otherwise stated, or when such Government and LICOMCEN. The dismissal was affirmed by this Court13 and attained
finality on September 20, 2000.14 This notwithstanding, LICOMCEN did not lift the
 70

suspension of the construction that it previously ordered. It then hired Designtech 1. ₱14,643,638. 51 representing material costs at site;
Consultants and Management System (Designtech) as its new project consultant, which, in
turn, invited contractors, including FSI, to bid for the bored piling works for CITIMALL. 15 2. ₱2,957,989.94 representing payment for equipment and labor standby costs;

FSI reiterated its demand for payment from LICOMCEN, but the latter failed and refused 3. ₱5,120,000.00 representing unrealized profit; and
to pay, prompting FSI to file a petition for arbitration with the CIAC, docketed as CIAC Case 4. ₱1,264,404.12 representing the unpaid balance of FSI's billing.
No. 37-2002.
FURTHER, the said Respondent is ordered to solely and exclusively bear the entire cost of
LICOMCEN denied the claim of FSI, arguing that it lacks factual and legal basis. It also arbitration proceedings in the total amount of ₱474,407.95 as indicated in the TOR, and to
assailed the jurisdiction of the CIAC to take cognizance of the suit, claiming that reimburse the herein Claimant of any amount thereof which it had advanced and paid
jurisdiction over the controversy was vested in the regular courts, and that arbitration pursuant to TOR.
under the GC-61 of the GCC may only be resorted to if the dispute concerns the execution
of works, not if it concerns breach of contract. All the above-awarded amounts shall bear interest of 6% per annum from the date of the
formal demand on February 3, 1998 (Par. 10, Admitted Facts, TOR) until the date this
During the preliminary conference, the parties agreed to submit the controversy to the Decision/Award becomes final and executory and 12% per annum from the date this
Arbitral Tribunal and signed the Terms of Reference (TOR).16 But on February 4, 2003, Decision/Award becomes final and executory until fully paid.
LICOMCEN, through a collaborating counsel, filed an Ex Abundati Ad Cautela Omnibus
Motion.17 It reiterated the claim that the arbitration clause in the contract does not cover SO ORDERED.20
claims for payment of unrealized profits and damages, and FSI did not comply with the
condition precedent for the filing of the suit, thus, the CIAC cannot take cognizance of the LICOMCEN elevated the CIAC Decision to the CA. It faulted the CIAC for taking cognizance
suit. LICOMCEN further averred that FSI has no cause of action against it because the of the case, arguing that it has no jurisdiction over the suit. It also assailed the award and
claim for material costs has no factual basis and because the contract is clear that FSI the ruling that the contract had been terminated, allegedly for lack of factual and legal
cannot claim damages beyond the actual work accomplishments, but only reasonable basis.
expenses for the suspension or termination of the contract. LICOMCEN also alleged that On November 23, 2004, the CA rendered the assailed Decision, modifying the CIAC
the expenses incurred by FSI, if there be any, cannot be considered reasonable, because Decision, viz.:
there was no showing that the materials were ordered and actually delivered to the job
site. Finally, it prayed for the suspension of the proceedings, pending the resolution of its WHEREFORE, the foregoing considered, the assailed Decision is hereby MODIFIED to the
omnibus motion. extent that paragraph 1 of the dispositive portion is amended and accordingly, petitioner
is ordered to pay only the amount of ₱5,694,939.865 representing the material costs at
On February 20, 2003, the CIAC issued an Order18 denying LICOMCEN’s omnibus motion site; and paragraphs 2 and 3 on equipment and labor standby costs and unrealized profit
on the ground that it runs counter to the stipulations in the TOR. Trial, thereafter, ensued. of the same dispositive portion are deleted. The rest is AFFIRMED in all respects. No costs.
FSI and LICOMCEN presented witnesses in support of their respective claims.
SO ORDERED.21
After due proceedings, the CIAC rendered a Decision19 in favor of FSI, the dispositive
portion of which reads: Both LICOMCEN and FSI filed motions for partial reconsideration, but these were denied
by the CA in its Resolutions dated February 4, 200522 and September 13, 2005.23
WHEREFORE, premises considered, judgment is hereby rendered in favor of
Claimant FOUNDATION SPECIALIST, INC. and against Respondent LICOMCEN, LICOMCEN and FSI reacted with the instant petitions. Considering that the cases involve
INCORPORATED, ordering the latter to pay to the former the following amounts: the same parties, issues and assailed decision, this Court ordered the consolidation of G.R.
No. 167022 and G.R. No. 169678 in its Resolution dated November 20, 2006.
 71

LICOMCEN raised the following issues: the latter is acquired by virtue of the party's voluntary submission to the authority of the
court through the exercise of its coercive process.26
1.
Section 4 of Executive Order (E.O.) No. 1008, or the Construction Industry Arbitration Law,
WHETHER OR NOT THE PROJECT WAS MERELY SUSPENDED AND NOT TERMINATED. provides:
2. SECTION 4. Jurisdiction. — The CIAC shall have original and exclusive jurisdiction over
WHETHER OR NOT THE TRIBUNAL HAD JURISDICTION OVER THE DISPUTE. disputes arising from, or connected with, contracts entered into by parties involved in
construction in the Philippines, whether the dispute arises before or after the completion
3. of the contract, or after the abandonment or breach thereof. These disputes may involve
government or private contracts. For the Board to acquire jurisdiction, the parties to a
WHETHER OR NOT FSI IS ENTITLED TO CLAIM ANY AMOUNT OF DAMAGES. dispute must agree to submit the same to voluntary arbitration.
4. The jurisdiction of the CIAC may include but is not limited to violation of specifications for
WHETHER OR NOT LICOMCEN IS THE PARTY AT FAULT. 24 materials and workmanship; violation of the terms of agreement; interpretation and/or
application of contractual provisions; amount of damages and penalties; commencement
FSI, on the other hand, interposes the following: time and delays; maintenance and defects; payment default of employer or contractor
and changes in contract cost.
1. THE COURT OF APPEALS ERRED IN NOT AWARDING TO PETITIONER THE FULL AMOUNT
OF MATERIAL COSTS AT THE SITE. Excluded from the coverage of this law are disputes arising from employer-employee
relationships which shall continue to be covered by the Labor Code of the Philippines.
2. THE COURT OF APPEALS ERRED IN DENYING PETITIONER'S CLAIM FOR EQUIPMENT AND (Emphasis supplied)
LABOR STANDBY COSTS.
Corollarily, Section 1, Article III of the Rules of Procedure Governing Construction
3. THE COURT OF APPEALS ERRED IN DENYING PETITIONER'S CLAIM FOR UNREALIZED Arbitration provides that recourse to the CIAC may be availed of whenever a contract
PROFIT. contains a clause for the submission of a future controversy to arbitration, thus:
4. THE COURT OF APPEALS ERRED IN RENDERING A MERE MINUTE RESOLUTION IN SECTION 1. Submission to CIAC Jurisdiction. — An arbitration clause in a construction
RESOLVING PETITIONER'S MOTION FOR PARTIAL RECONSIDERATION. 25 contract or a submission to arbitration of a construction dispute shall be deemed an
agreement to submit an existing or future controversy to CIAC jurisdiction,
First, we resolve the issue of the CIAC’s jurisdiction.
notwithstanding the reference to a different arbitration institution or arbitral body in such
LICOMCEN insists that the CIAC had no jurisdiction over the suit. Citing GC-05 and GC-61 contract or submission. When a contract contains a clause for the submission of a future
of the GCC, it posits that jurisdiction over the dispute rests with the regular courts of controversy to arbitration, it is not necessary for the parties to enter into a submission
Legaspi City. agreement before the claimant may invoke the jurisdiction of CIAC.

The argument is misplaced. Clearly then, the CIAC has original and exclusive jurisdiction over disputes arising from or
connected with construction contracts entered into by parties that have agreed to submit
The power and authority of a court to hear, try, and decide a case is defined as their dispute to voluntary arbitration.27
jurisdiction. Elementary is the distinction between jurisdiction over the subject matter and
jurisdiction over the person. The former is conferred by the Constitution or by law, while The GCC signed by LICOMCEN and FSI had the following arbitral clause:
 72

GC-61 DISPUTES AND ARBITRATION Contrary to what LICOMCEN wants to portray, the CIAC validly acquired jurisdiction over
the dispute. Firstly, LICOMCEN submitted itself to the jurisdiction of the CIAC when its
Should any dispute of any kind arise between the LICOMCEN, INCORPORATED and the president Antonio S. Tan signed the TOR30 during the preliminary conference. The TOR
Contractor or the Engineer and the Contractor in connection with, or arising out of the states:
execution of the Works, such dispute shall first be referred to and settled by the
LICOMCEN, INCORPORATED who shall within a period of thirty (30) days after being V. MODE OF ARBITRATION
formally requested by either party to resolve the dispute, issue a written decision to the
Engineer and Contractor. The parties agree that their differences be settled by an Arbitral Tribunal who were
appointed in accordance with the provision of Article V, Section 2 of the CIAC Rules of
Such decision shall be final and binding upon the parties and the Contractor shall proceed Procedure Governing Construction Arbitration, as follows:
with the execution of the Works with due diligence notwithstanding any Contractor’s
objection to the decision of the Engineer. If within a period of thirty (30) days from receipt SALVADOR C. CEGUERA
of the LICOMCEN, INCORPORATED’s decision on the dispute, either party does not Chairman
officially give notice to contest such decision through arbitration, the said decision shall FELISBERTO G.L. REYES
remain final and binding. However, should any party within thirty (30) days from receipt of Member
the LICOMCEN, INCORPORATED’s decision contest said decision, the dispute shall be
submitted for arbitration under the Construction Industry Arbitration Law, Executive SALVADOR P. CASTRO, JR.
Order 1008. The arbitrators appointed under said rules and regulations shall have full Member
power to open up, revise and review any decision, opinion, direction, certificate or
valuation of the LICOMCEN, INCORPORATED. Neither party shall be limited to the The case shall be decided in accordance with the Contract of the parties and the
evidence or arguments put before the LICOMCEN, INCORPORATED for the purpose of Construction Industry Arbitration Law (Executive Order No. 1008) and on the basis of
obtaining his said decision. No decision given by the LICOMCEN, INCORPORATED shall evidence submitted, applicable laws, and industry practices where applicable under the
disqualify him from being called as a witness and giving evidence in the arbitration. It is law.31
understood that the obligations of the LICOMCEN, INCORPORATED, the Engineer and the Secondly, we agree with the CA that the suit arose from the execution of works defined in
Contractor shall not be altered by reason of the arbitration being conducted during the the contract. As it aptly ratiocinated:
progress of the Works.28
[T]he dispute between [FSI] and [LICOMCEN] arose out of or in connection with the
LICOMCEN theorizes that this arbitration clause cannot vest jurisdiction in the CIAC, execution of works. [LICOMCEN] has gone quite far in interpreting "disputes arising out of
because it covers only disputes arising out of or in connection with the execution of or in connection with the execution of work" as separate and distinct from "disputes
works, whether permanent or temporary. It argues that since the claim of FSI was not arising out of or in connection with the contract" citing the various provisions of the
connected to or did not arise out of the execution of the works as contemplated in GC-61, Construction Agreement and Bid Documents to preclude CIAC from taking cognizance of
but is based the case. To the mind of this Court, such differentiation is immaterial. Article 1374 of the
on alleged breach of contract, under GC-0529 of the GCC, the dispute can only be taken Civil Code on the interpretation of contracts ordains that "the various stipulations of a
cognizance of by the regular courts. Furthermore, FSI failed to comply with the condition contract shall be interpreted together, attributing to the doubtful ones that sense which
precedent for arbitration. Thus, according to LICOMCEN, the CIAC erred in assuming may result from all of them taken jointly." Essentially, while we agree that [FSI’s] money
jurisdiction over the case. claims against [LICOMCEN] arose out of or in connection with the contract, the same
necessarily arose from the work it accomplished or sought to accomplish pursuant
 73

thereto. Thus, said monetary claims can be categorized as a dispute arising out of or in 2. For Convenience of LICOMCEN, INCORPORATED
connection with the execution of work.32
If any time before completion of work under the Contract it shall be found by the
Thirdly, FSI complied with the condition precedent provided in GC-61. Record shows that LICOMCEN, INCORPORATED that reasons beyond the control of the parties render it
FSI referred the claim to ESCA on February 3, 1998, and then to LICOMCEN on March 3, impossible or against the interest of LICOMCEN, INCORPORATED to complete the work,
1998,33 but it was disallowed on March 24, 1998.34 Then, on April 15, 1998, FSI rejected the LICOMCEN, INCORPORATED at any time, by written notice to the Contractor, may
the evaluation of the billings made by ESCA and LICOMCEN and further informed the discontinue the work and terminate the Contract in whole or in part. Upon issuance of
latter of its intention to turn over the project.35 FSI exerted efforts to have the claim such notice of termination, the Contractor shall discontinue the work in such manner,
settled amicably, but no settlement was arrived at. Hence, on March 14, 2001, FSI through sequence and at such time as the LICOMCEN, INCORPORATED/Engineer may direct,
counsel made a final demand to pay.36 LICOMCEN, however, adamantly refused to pay, continuing and doing after said notice only such work and only until such time or times as
prompting FSI to file suit with the CIAC. Clearly, FSI substantially complied with the the LICOMCEN, INCORPORATED/Engineer may direct. x x x41 (Emphasis supplied)
condition precedent laid down in GC-61. Finally, the arbitral clause in the agreement,
considering that the requisites for its application are present, is a commitment by the Unfortunately for LICOMCEN, this provision does not support but enervates its theory of
parties to submit to arbitration the disputes covered therein. Because that clause is indefinite suspension. The cited provision may be invoked only in cases of termination of
binding, they are expected to abide by it in good faith.37 contract, as clearly inferred from the phrase "discontinue the work and terminate the
contract." And in statutory construction implies conjunction, joinder or union.42 Thus, by
Just as meaningful, the issue of jurisdiction was rendered moot by LICOMCEN's active invoking GC-41, LICOMCEN, in effect, admitted that the contract had already been
participation in the proceedings before the CIAC. It is true that LICOMCEN initially assailed terminated.
the jurisdiction of the CIAC. But when the CIAC asserted its jurisdiction in its February 20,
2003 Order,38 LICOMCEN did not seek relief from the CIAC ruling. Instead, LICOMCEN took The termination of the contract was made obvious and unmistakable when LICOMCEN’s
part in the discussion on the merits of the case, even going to the extent of seeking new project consultant rebidded the contract for the bored piling works for the
affirmative relief. The active involvement of a party in the proceedings is tantamount to CITIMALL.43 The claim that the rebidding was conducted for purposes of getting cost
an invocation of, or at least an acquiescence to, the court's jurisdiction. Such participation estimates for a possible new design44 taxes our credulity. It impresses us as nothing more
indicates a willingness to abide by the resolution of the case, and will bar said party from than a lame attempt of LICOMCEN to avoid liability under the contract. As the CIAC had
later on impugning the court or body's jurisdiction.39 The Court will not countenance the taken pains to demonstrate:
effort of any party to subvert or defeat the objective of voluntary arbitration for its own Suspension of work is ordinarily understood to mean a temporary work stoppage or a
private motives.40 After submitting itself to arbitration proceedings and actively cessation of work for the time being. It may be assumed that, at least initially, LCC had a
participating therein, LICOMCEN is estopped from assailing the jurisdiction of the CIAC, valid reason to suspend the Works on December 16, 1997 pursuant to GC-38 above-
merely because the latter rendered an adverse decision. quoted. The evidence show, however, that it has not ordered a resumption of work up to
Having resolved the issue of jurisdiction, we proceed to the merits of the case. the present despite the lapse of more than four years, and despite the dismissal of the
case filed with the Office of the Ombudsman which it gave as reason for the suspension in
LICOMCEN faults the CIAC and the CA for ruling that the contract had been terminated, the first place. As such, LCC’s suspension of the Works had already lost its essential
insisting that it was merely indefinitely suspended. To bolster its position, LICOMCEN cited characteristic of being merely temporary or only for the time being. To still consider it a
GC-41 of the GCC which reads: "suspension" at this point is to do violence to reason and logic.

GC-41 LICOMCEN, INCORPORATED’S RIGHT TO SUSPEND WORK OR TERMINATE THE Perhaps because of this LCC came up with the assertion that what we have is an
CONTRACT "indefinite suspension." There is no such term in the Construction Agreement or the
Contract Documents. In fact, it is unknown in the construction industry. Construction work
xxxx
 74

may either be suspended or terminated, but never indefinitely suspended. Since it is not We now come to the monetary awards granted to FSI. LICOMCEN avers that the award
sanctioned by practice and not mentioned in the herein Construction Agreement and the lacked factual and legal basis. FSI, on the other hand, posits otherwise, and cries foul on
Contract Documents, "indefinite suspension" is irregular and invalid. Due to the apparent the modification made by the CA. It asserts that the CA erred in disregarding the pieces of
incongruity of an "indefinite suspension," LCC changed the term to "continued evidence that it submitted in support of the claim despite the lack of objection and
suspension" in its Memorandum. Unfortunately for it, the factual situation remains opposition from LICOMCEN. It insists entitlement to the full amount of material costs at
unchanged. The Works stay suspended for an indefinite period of time.45 site, for equipment and labor standard costs, as well as unrealized profits.

Accordingly, the CA did not err in affirming the CIAC ruling that the contract had already In this connection, we must emphasize the distinction between admissibility of evidence
been terminated. and its probative value. Just because a piece of evidence is not objected to does not ipso
facto mean that it conclusively proves the fact in dispute. The admissibility of evidence
Neither can LICOMCEN find refuge in the principle of laches to steer clear of liability. It is should not be confused with its probative value. Admissibility refers to the question of
not just the lapse of time or delay that constitutes laches. The essence of laches is the whether certain pieces of evidence are to be considered at all, while probative value
failure or neglect, for an unreasonable and unexplained length of time, to do that which, refers to the question of whether the admitted evidence proves an issue. Thus, a
through due diligence, could or should have been done earlier, thus giving rise to a particular item of evidence may be admissible, but its evidentiary weight depends on
presumption that the party entitled to assert it had either abandoned or declined to judicial evaluation within the guidelines provided by the rules of evidence. 50
assert it. 46
We have carefully gone over the records and are satisfied that the findings of the CA are
Indeed, FSI filed its petition for arbitration only on October 8, 2002, or after the lapse of well supported by evidence. As mentioned above, the contract between LICOMCEN and
more than four years since the project was "indefinitely suspended." But we agree with FSI had already been terminated and, in such case, the GCC expressly provides that:
the CIAC and the CA that such delay can hardly be considered unreasonable to give rise to
the conclusion that FSI already abandoned its claim. On the contrary, the delay was due to GC-42 PAYMENT FOR TERMINATED CONTRACT
the fact that FSI exerted efforts to have the claim settled extra-judicially which LICOMCEN
rebuffed. Besides, except for LICOMCEN’s allegation that the filing of the suit is already If the Contract is terminated as aforesaid, the Contractor will be paid for all items of work
barred by laches, no proof was offered to show that the filing of the suit was iniquitous or executed, and satisfactorily completed and accepted by the LICOMCEN, INCORPORATED
unfair to LICOMCEN. We reiterate that, unless reasons of inequitable proportions are up to the date of termination, at the rates and prices provided for in the contract and in
adduced, a delay within the prescriptive period is sanctioned by law and is not to be addition:
considered delay that would bar relief.47 In the instant case, FSI filed its claim well within 1. The cost of partially accomplished items of additional or extra work agreed upon by the
the ten-year prescriptive period provided for in Article 1144 of the Civil Code.48 Therefore, LICOMCEN, INCORPORATED and the Contractor.
laches cannot be invoked to bar FSI from instituting this suit.
2. The cost of materials or goods reasonably ordered for the Permanent or Temporary
The doctrine of laches is based upon grounds of public policy which require, for the peace Works which have been delivered to the Contractor but not yet used and which delivery
of society, discouraging stale claims. It is principally a question of the inequity or has been certified by the Engineer.
unfairness of permitting a right or claim to be enforced or asserted. There is no absolute
rule as to what constitutes laches; each case is to be determined according to its particular 3. The reasonable cost of demobilization
circumstances. The question of laches is addressed to the sound discretion of the court,
and since it is an equitable doctrine, its application is controlled by equitable For any payment due the Contractor under the above conditions, the LICOMCEN,
considerations. It cannot be worked to defeat justice or to perpetrate fraud and INCORPORATED, however, shall deduct any outstanding balance due from the Contractor
injustice. 49 for advances in respect to mobilization and materials, and any other sum the LICOMCEN,
INCORPORATED is entitled to be credited.51
 75

We agree with the Court of Appeals that the liability of LICOMCEN for the cost of x x x The Contractor shall have no claim for anticipated profits on the work thus
materials on site is only ₱5,694,939.85. The said award represents the materials terminated, nor any other claim, except for work actually performed at the time of
reasonably ordered for the project and which were delivered to the job site. FSI cannot complete discontinuance, including any variations authorized by the LICOMCEN,
demand full payment of the steel bars under Purchase Order No. 6035.52 As shown by the INCORPORATED/Engineer to be done under the section dealing with variation, after the
records, the steel bars were loaded at M/V Alberto only on January 12, 199853 and date of said order, and for any claims for variations accruing up to the date of said notice
reached Legaspi City on January 16, 1998.54 But as early as December 16, 1997, LICOMCEN of termination.61 (Emphasis supplied)
already informed FSI of the major revision of the design and ordered the non-delivery to
the jobsite of the 50% of the steel bars. Inexplicably, FSI continued the delivery. Worse, it The provision was agreed upon by the parties freely, and significantly, FSI did not question
unloaded all the steel bars and delivered them to the jobsite and some to the Tuanzon this. It is not for the Court to change the stipulations in the contract when they are not
batching plant on January 17, 1998,55 despite LICOMCEN’s order not to do so. FSI cannot illegal. Article 1306 of the Civil Code provides that the contracting parties may establish
now claim payment of the cost of all these materials. such stipulations, clauses, terms and conditions as they may deem convenient, provided
they are not contrary to law, morals, good customs, public order, or public
LICOMCEN, however, cannot deny liability for 50% of the steel bars because, as policy.62 Besides, no convincing proof was offered to prove the claim. In light of the
mentioned, it ordered their delivery to the jobsite. The steel bars had in fact been foregoing, the CA, therefore, correctly denied the claim for unrealized profit.1awph!l
delivered to the jobsite and inventoried by Cesar Cortez of ESCA,56 contrary to
LICOMCEN’s claim. The payment of these materials is, therefore, in order, pursuant to GC- Similarly, we agree with the CIAC and the CA that LICOMCEN should bear the cost of
41: arbitration as it adamantly refused to pay FSI’s just and valid claim, prompting the latter to
institute a petition for arbitration.
The Contractor shall receive compensation for reasonable expenses incurred in good faith
for the performance of the Contract and for reasonable expenses associated with the In sum, we find no reason to disturb the decision of the CA. It cannot be faulted for
termination of the Contract. x x x.57 denying FSI’s motion for reconsideration through a mere Minute Resolution, for as we
held in Ortigas and Company Limited Partnership v. Velasco:63
We also uphold the denial of FSI’s claim for equipment and labor standard costs, as no
convincing evidence was presented to prove it. The list of rented equipment 58 and the list The filing of a motion for reconsideration, authorized by Rule 52 of the Rules of Court,
of workers59 offered by FSI and which were admitted by CIAC, are far from being clear and does not impose on the Court the obligation to deal individually and specifically with the
convincing proof that FSI actually incurred the expenses stated therein. grounds relied upon therefor, in much the same way that the Court does in its judgment
or final order as regards the issues raised and submitted for decision. This would be a
As aptly said by the CA, FSI should have presented convincing pieces of documentary useless formality or ritual invariably involving merely a reiteration of the reasons already
evidence, such as the lease contract or the receipts of payment issued by the owners of set forth in the judgment or final order for rejecting the arguments advanced by the
the rented equipment, to establish the claim. As to its claimed labor expenses, the list of movant; and it would be a needless act, too, with respect to issues raised for the first
employees does not categorically prove that these listed employees were actually time, these being, x x x deemed waived because not asserted at the first opportunity. It
employed at the construction site during the suspension. Hence, even assuming that suffices for the Court to deal generally and summarily with the motion for
LICOMCEN failed to submit evidence to rebut these lists, they do not ipso facto translate reconsideration, and merely state a legal ground for its denial (Sec. 14, Art. VIII,
into duly proven facts. FSI still had the burden of proving its cause of action, because it is Constitution); i.e., the motion contains merely a reiteration or rehash of arguments
the one asserting entitlement to an affirmative relief.60 On this score, FSI failed. The CA, already submitted to and pronounced without merit by the Court in its judgment, or the
therefore, committed no reversible error in denying the claim. basic issues have already been passed upon, or the motion discloses no substantial
argument or cogent reason to warrant reconsideration or modification of the judgment or
FSI’s claim for unrealized profit has to be rejected too. GC-41 specifically provided that: final order; or the arguments in the motion are too unsubstantial to require consideration,
etc.
 76

WHEREFORE, the herein petitions for review are DENIED, and the assailed Decision and Communications Co., Inc. and International Communications Corporation, among others,
Resolutions of the Court of Appeals are AFFIRMED. were beneficiaries of formal awards of service area assignments in April and May, 1994.

G.R. No. 126496 April 30, 1997 On March 25, 1994, Republic Act No. 7692 was enacted granting private respondent
BellTel a congressional franchise which gave private respondent BellTel the right, privilege
GMCR, INC.; SMART COMMUNICATIONS, INC.; INTERNATIONAL COMMUNICATIONS and authority to
CORP.; ISLA COMMUNICATIONS CO., INC., petitioners,
vs. carry on the business of providing telecommunications services in and between provinces,
BELL TELECOMMUNICATION PHILIPPINES, INC.; THE NATIONAL TELECOMMUNICATIONS cities, and municipalities in the Philippines and for this purpose, to establish, operate,
COMMISSION and HON. SIMEON L. KINTANAR in his official capacity as Commissioner of manage, lease, maintain and purchase telecommunications systems, including mobile,
the National Telecommunications, respondents. cellular and wired or wireless telecommunications systems, fiber optics, satellite transmit
and receive systems, and other telecommunications systems and their value-added
COMMISSIONER SIMEON L. KINTANAR, NATIONAL TELECOMMUNICATIONS services such as, but not limited to, transmission of voice, data, facsimile, control signals,
COMMISSION, petitioner, audio and video, information service bureau, and all other telecommunications systems
vs. technologies as are at present available or be made available through technical advances
BELL TELECOMMUNICATION PHILIPPINES, INC., respondent. or innovations in the future, or construct, acquire, lease and operate or manage
transmitting and receiving stations and switching stations, both for local and international
services, lines, cables or systems, as is, or are convenient or essential to efficiently carry
HERMOSISIMA, JR., J.: out the purposes of this franchise.5

Before us are consolidated petitions seeking the review and reversal of the decision1 of On July 12, 1994, private respondent BellTel filed with the NTC a second
the respondent Court of Appeals2 declaring the National Telecommunications Commission Application6 praying for the issuance of a Certificate of Public Convenience and Necessity
(hereafter, NTC) to be a collegial body under Executive Order No. 5463 and ordering the for the installation, operation and maintenance of a combined nationwide local toll
NTC to heretofore sit and act en banc, i.e., with the concurrence of at least two (domestic and international) and tandem telephone exchanges and facilities using wire,
commissioners, for a valid dispensation of its quasi-judicial functions. wireless, microwave radio, satellites and fiber optic cable with Public Calling Offices
(PCOs) and very small aperture antennas (VSATs) under an integrated system. This second
Established by evidence are the following facts: application was docketed as NTC Case No. 94-229. In this second application, BellTel
On October 19, 1993, private respondent Bell Telecommunication Philippines, Inc. proposed to install 2,600,000 telephone lines in ten (10) years using the most modern and
(hereafter, BellTel) filed with the NTC an Application for a Certificate of Public latest state-of-the-art facilities and equipment and to provide a 100% digital local
Convenience and Necessity to Procure, Install, Operate and Maintain Nationwide exchange telephone network
Integrated Telecommunications Services and to Charge Rates Therefor and with Further Private respondent BellTel moved to withdraw its earlier application docketed as NTC
Request for the Issuance of Provisional Authority. This application was docketed as NTC Case No. 93-481. In an Order dated July 11, 1994, this earlier application was ordered
Case No. 93-481. At the time of the filing of this application, private respondent BellTel withdrawn, without prejudice.
had not been granted a legislative franchise to engage in the business of
telecommunications service. The second application of private respondent BellTel which was docketed as NTC Case No.
94-229 was assigned to a Hearing Officer for reception of private respondent BellTel's
Since private respondent BellTel was, at that time, an unenfranchised applicant, it was evidence. Written opposition and other pertinent pleadings were filed by petitioners
excluded in the deliberations for service area assignments for local exchange carrier GMCR, Inc., Smart Communications, Inc., Isla Communications Co., Inc. and International
service 4 . Thus, only petitioners GMCR, Inc., Smart Communications, Inc., Isla
 77

Communications Corporation as oppositors. Other oppositors to private respondent Deputy Commissioners Fidelo Q. Dumlao and Consuelo Perez but was not signed by
BellTel's application were Capitol Wireless, Inc., Eastern Misamis Oriental Telephone Commissioner Simeon Kintanar.
Cooperative, Liberty Broadcasting Network, Inc., Midsayap Communication, Northern
Telephone, PAPTELCO, Pilipino Telephone Corporation, Philippine Global While ordinarily, a decision that is concurred in by two of the three members composing a
Communications, Inc., Philippine Long Distance Telephone Company, Philippine Telegraph quasi-judicial body is entitled to promulgation, petitioners claim that pursuant to the
and Telephone Corporation, Radio Communications of the Philippines, Inc. and Extelcom prevailing policy and the corresponding procedure and practice in the NTC, the exclusive
and Telecommunications Office. authority to sign, validate and promulgate any and all orders, resolutions and decisions of
the NTC is lodged in the Chairman, in this case, Commissioner Simeon Kintanar, and, thus,
On December 20, 1994, private respondent BellTel completed the presentation of its since only Commissioner Simeon Kintanar is recognized by the NTC Secretariat as the sole
evidence-in-chief. In the course of the proceedings, the witnesses of BellTel were cross- authority to sign any and all orders, resolutions and decisions of the NTC, only his vote
examined by the aforementioned oppositors. On December 21, 1994, BellTel filed its counts; Deputy Commissioners Dumlao and Perez have allegedly no voting power and
Formal Offer of Evidence together with all the technical, financial and legal documents in both their concurrence which actually constitutes the majority is inutile without the
support of its application. Pursuant to its rules, the application was referred to the assent of Commissioner Kintanar.
Common Carriers Authorization Department (CCAD) for study and recommendation.
Anxious over the inaction of the NTC in the matter of its petition praying for the issuance
On February 6, 1995, the CCAD, through Engr. Marle Rabena, submitted to Deputy of a provisional authority, private respondent BellTel filed on May 5, 1995 an Urgent Ex-
Commissioner Fidelo Q. Dumlao, a Memorandum dated February 6, 19957 manifesting his Parte Motion to Resolve Application and for the Issuance of a Provisional Authority 11.
findings and recommending that "based on technical documents submitted, BellTel's Reference was explicitly made to the findings of the CCAD and recommendations of
proposal is technically feasible."8 Deputy Commissioners Dumlao and Perez that were all favorable to private respondent
BellTel. Mention was also made of the aforementioned working draft of the order
Subsequently, Mr. Raulito Suarez, the chief of the Rates and Regulatory Division of CCAD, granting a provisional authority to BellTel, which draft was made by the Legal Department
conducted a financial evaluation of the project proposal of private respondent BellTel. On of the NTC and initialed by the said deputy commissioners.
March 29, 1995, Mr. Suarez made the finding that BellTel has the financial capability to
support its proposed project at least for the initial two (2) years. No action was taken by the NTC on the aforecited motion. Thus, on May 12, 1995, private
respondent BellTel filed a Second Urgent Ex-Parte Motion 12 reiterating its earlier prayer.
Agreeing with the findings and recommendations of the CCAD, NTC Deputy
Commissioners Fidelo Dumlao and Consuelo Perez adopted the same and expressly Petitioners-oppositors filed an Opposition 13 to the aforestated two motions of private
signified their approval thereto by making the following notation on the aforestated respondent BellTel.
Memorandum of the CCAD dated February 6, 1995:
In an Order dated May 16, 1995, signed solely by Commissioner Simeon Kintanar, the NTC,
With the finding of financial capability and technical feasibility, the application merits instead of resolving the two pending motions of private respondent BellTel, set the said
due/favorable consideration.9 motions for a hearing on May 29, 1995. On May 29, 1995, however, no hearing was
conducted as the same was reset on June 13, 1995.
Below this notation, Deputy Commissioners Fidelo Dumlao and Consuelo Perez affixed
their signatures and the date, "4/6/95." On June 13, 1995, the day of the hearing, private respondent BellTel filed a Motion to
Promulgate (Amending the Motion to Resolve) 14. In said motion, private respondent
In view of these favorable recommendations by the CCAD and two members of the NTC, prayed for the promulgation of the working draft of the order granting a provisional
the Legal Department thereof prepared a working draft 10 of the order granting authority to private respondent BellTel, on the ground that the said working draft had
provisional authority to private respondent BellTel. The said working draft was initialed by already been signed or initialed by Deputy Commissioners Dumlao and Perez who,
together, constitute a majority out of the three commissioners composing the NTC. To
 78

support its prayer, private respondent BellTel asserted that the NTC was a collegial body IN THE LIGHT OF ALL THE FOREGOING, judgment is hereby rendered as follows:
and that as such, two favorable votes out of a maximum three votes by the members of
the commission, are enough to validly promulgate an NTC decision. 1. Petitioner's petition for a writ of Certiorari and Prohibition is hereby granted.
Accordingly, NTC Memorandum Circular No. 1-1-93, Annex "J" of the
On June 23, 1995, petitioners-oppositors filed their Joint Opposition 15 to the aforecited Petition, Memorandum Circular No. 3-1-93, Annex "K" of the Petition and the Order of
motion. Kintanar, Annex "L" of the Petition, are hereby SET ASIDE for being contrary to law. The
Respondents and all those acting for and in their behalf are hereby enjoined and
On July 4, 1995, the NTC denied the said motion in an Order solely signed by prohibited from implementing or enforcing the same; [and]
Commissioner Simeon Kintanar.
2. Petitioner's petition for mandamus is hereby GRANTED in that the Respondent NTC,
On July 17, 1995, private respondent BellTel filed with this court a Petition composed of Kintanar and deputy commissioners Perez and Dumlao, are hereby directed
for Certiorari, Mandamus and Prohibition seeking the nullification of the aforestated to meet en banc and to consider and act on the draft Order, Annex "B" of the
Order dated July 4, 1995 denying the Motion to Promulgate. Petition, within fifteen (15) days from the finality of this Decision. Without
On July 26, 1995, we issued a Resolution referring said petition to the respondent Court of pronouncement as to costs.
Appeals for proper determination and resolution pursuant to Section 9, par. 1 of B.P. Blg. SO ORDERED. 18
129.
The herein assailed decision being unacceptable to petitioner Simeon Kintanar and
In the interim, the Solicitor General filed with the respondent appellate court a petitioners GMCR, Inc., Smart Communications, Inc., Isla Communications Co., Inc. and
Manifestation In Lieu of Comment 16 in which the Solicitor General took a legal position International Communications Corporation as oppositors in the application of private
adverse to that of the NTC. The Solicitor General, after a close examination of the laws respondent BellTel for a provisional authority, they filed with this court separate petitions
creating the NTC and its predecessors and a studious analysis of certain Department of for review.
Transportation and Communications (DOTC) orders, NTC circulars, and Department of
Justice (DOJ) legal opinions pertinent to the issue of collegiality of the NTC, made the Commissioner Kintanar's petition, docketed as G.R No. 126526, ascribes to the respondent
following recommendations: appellate court the following assignment of errors:

WHEREFORE, the Solicitor General respectfully prays that this Honorable Court: 1. The Court of Appeals in setting aside NTC MC 1-1-93 and MC 3-1-93 and the Order of
the Commission dated July 4, 1995, made a collateral attack on a law which was nowhere
(a) declare respondent National Telecommunications Commission as a collegial body; called for in the pleadings of the parties nor is authorized by the Rules of Court.
(b) restrain respondent Commissioner Simeon Kintanar from arrogating unto himself 2. The Court of Appeals erred in assuming and imposing that the Commission is a collegial
alone the powers of the said agency; body simply by reason of the fact that other bodies which were a spin off from the
(c) order NTC, acting as a collegial body, to resolve petitioner Bell Telecom's application defunct Public Service Commission were created as a collegial body. The law that created
under NTC-94-229; EO 546 erased the collegial character of the proceeding before the NTC.

(d) declare NTC Memorandum Circulars 1-1-93 and 3-1-93 as void; [and] 3. The Court of Appeals' decision contains serious contradiction; worse, it considered
evidence not formally offered or incorporated into the records of the case; yet failed to
(e) uphold the legality of DOTC Department Order 92-614. 17 consider evidence submitted by petitioner- appellant nor on the prejudicial issue on non-
joinder of indispensable parties.
On September 23, 1996, respondent Court of Appeals promulgated the herein assailed
decision the dispositive portion of which reads as follows:
 79

3.1 CA erred in assuming that the NTC is collegial by the fact that Charters of other 5. Even assuming that the Court of Appeals correctly defined the prime issues as being
regulatory agencies expressly made them collegial while this express provision was absent that of collegiality, nonetheless the Court of Appeals committed a serious error of law in
in NTC's charter. declaring the NTC as a collegial body despite the clear intent of E.O. No. 546 and the
provisions of DOTC MC 95-640, and the obvious implications of pending bills in Congress
3.2 CA contradicts itself by holding that DOTC MC 92-614 prevails and [requires] on the reorganization of the NTC;
collegiality.
6. The Decision, in mandating that the NTC Commissioner and Deputy Commissioners sit
3.3 The decisions by Undersecretary Lichauco signed by her and her 2 deputies are in no to consider the draft-and only the draft-in rendering its Decision in BellTel's application
way indicative of collegiality and should not be considered as having any persuasive effect constitutes an unwarranted, unauthorized and unlawful interference in and canalization
... of the discretionary functions of the Commission as a quasi-judicial entity; and
3.4 The Court of Appeals erred in applying the Board of Communications Rules of Practice 7. The Decision condones the illegal and unethical act of BellTel of surreptitiously securing
and Procedures. a draft decision, and encourages and places premium on future similar illegal acts-all in
4. The Court of Appeals erred when it granted mandamus, directing and in effect violation of the ruling and the mandate of the Supreme Court in In Re Jurado: Adm.
controlling Commissioner Kintanar and deputy Commissioners Dumlao and Perez, to Matter No. 90-5-383 (July 12, 1990). 20
meet en banc to consider and act on a "draft Order" only which the Court itself recognized On December 16, 1996, private respondent BellTel filed an Omnibus Motion 21 praying for,
no longer had the approval of two (2) Commissioners while in the same token the Court of among others, the consolidation of G.R Nos. 126496 and 126526.
Appeals had set aside a duly promulgated Order of July 4, 1995 allegedly because it did
not carry the approval of 2 commissioners. 19 On December 18, 1996, respondent BellTel filed its Comment. 22 On the same day, the
NTC and Commissioner Kintanar filed a Manifestation/Motion 23 echoing the prayer for
On the other hand, petitioners-oppositors, in their petition docketed as G.R No. 126496, the consolidation of the G.R Nos. 126496 and 126526.
assail the decision of respondent appellate court on the following grounds:
On December 19, 1996, the Office of the Solicitor General filed a
1. The Court of Appeals erred in not dismissing the instant Petition outright for its failure Manifestation/Motion 24 reiterating that its legal stance in this case is adverse to that of
to implead indispensable parties, in violation of Section 5, Rule 65 and Sec. 3, Rule 7 of the the NTC and praying that it be excluded from filing any comment in behalf of the NTC.
Revised Rules of Court;
In a Resolution dated February 5, 1997, we resolved, among others, to excuse the Solicitor
2. The Court of Appeals seriously erred in taking cognizance of and passing upon BellTel's General from filing any comment in behalf of the NTC, require the NTC to file its own
Petition, which on its face is premature since the Order of July 4, 1996 assailed was not a comment in G.R No. 126496 and to consolidate G.R Nos. 126496 and 126526.
find decision of the Commission;
On March 6, 1997, the NTC and Commissioner Kintanar filed a
3. Even assuming arguendo that the Court of Appeals can take cognizance of the Petition, Manifestation/Motion 25 praying that the latter's petition in G.R No. 126526 be adopted as
the disposition in Decision therein which nullifies NTC Memorandum Circulars 1-1-93 and their comment in the consolidated cases.
3-1-93 itself constitutes a collateral attack on the said laws, the validity of which were
never put in issue by any of the parties, contrary to the clear legal requirement that the Upon the joinder of issues in these consolidated cases, we perceive the fundamental issue
validity of laws can be attacked only in direct proceedings instituted for that purpose; to be that of the collegiality of the NTC as a quasi-judicial agency.

4. It was in fact improper for the Court of Appeals to pass on the validity of NTC Circular We find the consolidated petitions wanting of merit.
No. 1-1-93 and Memorandum Circular No 3-1-93 since the same was absolutely
unnecessary for the resolution of the Petition;
 80

First. We hereby declare that the NTC is a collegial body requiring a majority vote out of employment; two full-time members who shall be competent on all aspects of
the three members of the commission in order to validly decide a case or any incident communications, preferably one of whom shall be a lawyer and the other an economist . .
therein. Corollarily, the vote alone of the chairman of the commission, as in this case, the .
vote of Commissioner Kintanar, absent the required concurring vote coming from the rest
of the membership of the commission to at least arrive at a majority decision, is not On January 25, 1978, the BOC promulgated its "Rules of Procedure and Practice" in
sufficient to legally render an NTC order, resolution or decision. connection with applications and proceedings before it.

Simply put, Commissioner Kintanar is not the National Telecommunications Commission. On July 23, 1979, President Marcos issued Executive Order No. 546, creating the Ministries
He alone does not speak for and in behalf of the NTC. The NTC acts through a three-man of Public Works, and of Transportation and Communications, merged the defunct Board of
body, and the three members of the commission each has one vote to cast in every Communications and the Telecommunications Control Bureau into a single entity, the
deliberation concerning a case or any incident therein that is subject to the jurisdiction of National Telecommunications Commission (NTC). The said law was issued by then
the NTC. When we consider the historical milieu in which the NTC evolved into the quasi- President Marcos in the exercise of his legislative powers. Sec. 16 of E.O. 546 provides
judicial agency it is now under Executive Order No. 146 which organized the NTC as a that —
three-man commission and expose the illegality of all memorandum circulars negating the . . . The Commission shall be composed of a Commissioner and two Deputy
collegial nature of the NTC under Executive Order No. 146, we are left with only one Commissioners, preferably one of whom shall be a lawyer and another an economist. . . .
logical conclusion: the NTC is a collegial body and was a collegial body even during the
time when it was acting as a one-man regime. The aforementioned Executive Order took effect on September 24, 1979 . . . However, the
NTC did not promulgate any Rules of Procedure and Practice. Consequently, the then
We thus quote with approval the encompassing legal ruminations of the respondent Court existing Rules of Procedure and Practice promulgated by the BOC was applied to
of Appeals in disposing of the issue of the collegiality of the NTC: proceedings in the NTC. In the meantime, the Decisions of the NTC were signed by the
In resolving the issue, We recall that, on November 17, 1936, the National Assembly Chairman alone of the NTC which rendered the two (2) deputy Commissioners "non-
passed Commonwealth Act No. 146 which created the Public Service Commission (PSC). participative" in the task of decision-making. This prompted the then Minister of
While providing that the PSC shall consist of a Public Service Commissioner and a Deputy Transportation and Communication Jose P. Dans, Jr. to seek the legal opinion of the then
Commissioner, the law made it clear that the PSC was not a collegial body by stating that Minister of Justice Ricardo C. Puno, as to whether the NTC was a collegial body or not. On
the Deputy Commissioner could act only on matters delegated to him by the Public January 11, 1984, Minister Puno sent a letter-opinion . . . to the effect that the NTC was
Service Commissioner. As amended by RA 2677, the Public Service Commission was not a collegial body but a single entity and thus the then practice of only the Chairman of
transformed into and emerged as a collegial body, composed of one Public Service the NTC signing the Decisions of the NTC was authorized by law. . . .
Commissioner and five (5) Associate Commissioners. The amendment provided that Admittedly, the opinion of the Secretary of Justice is entitled to great weight . . . .
contested cases and all cases involving the fixing of rates shall be decided by the However, the same is not controlling or conclusive on the courts . . . . We find and declare,
Commission en banc. in the present recourse, that the Puno Opinion is not correct. Admittedly, EO 546 does not
On September 24, 1972, then President Ferdinand E. Marcos signed, into law, Presidential specifically state that the NTC was a collegial body. Neither does it provide that the NTC
Decree No. 1 adopting and approving the Integrated Reorganization Plan which, in turn, should meet En Banc in deciding a case or in exercising its adjudicatory or quasi-judicial
created the Board of Communications (BOC) in place of the PSC. This time, the new functions. But the absence of such provisions does not militate against the collegial nature
regulatory board was composed of three (3) officers exercising quasi-judicial functions: of the NTC under the context of Section 16 of EO 546 and under the Rules of Procedure
and Practice applied by the NTC in its proceedings. Under [Rule 15] of said Rules, the BOC
. . . The Board of Communications shall be composed of a full time Chairman who shall be (now the NTC) sits En Banc.
of unquestioned integrity and recognized prominence in previous public and/or private
 81

. . . In every case heard by the Board en banc, the orders, rulings, decisions and resolutions [a] body composed of several persons acting under lawful authority to perform some
disposing of the merits of the matter within its jurisdiction shall be reached with the public senica (City of Louisville Municipal Housing Commission versus Public Housing
concurrence of at least two regular members after deliberation and consultation and Administration, 261 Southwestern Reporter, 2nd, page 286).
thereafter assigned to a member for the writing of the opinion. Any member dissenting
from the order, ruling, decision or resolution shall state in writing the reason for his A Commission is also defined as a board or committee of officials appointed and
dissent. empowered to perform certain acts or exercise certain jurisdiction of a public nature or
service . . . (Black, Law Dictionary, page 246). There is persuasive authority that a
In all other cases, a duly assigned Member shall issue all orders, rulings, decisions and "commission" is synonymous with "board" (State Ex. Rel. Johnson versus Independent
resolutions pertinent to the case assigned to him. Copy of the decision on the merit of the School District No. 810, Wabash County, 109 Northwestern Reporter 2nd, page 596).
case so assigned shall be furnished the Chairman of the Board. Indeed, as can be easily discerned from the context of Section 16 of Executive Order No.
546, the Commission is composed of a Commissioner and two (2) deputy commissioners .
xxx xxx xxx . . not the commissioner, alone, as pontificated by Kintanar. The conjunctive word "and" is
Inscrutably, a case before the BOC may be assigned to and heard by only a member not without any legal significance. It is not, by any chance, a surplusage in the law. It
thereof who is tasked to prepare and promulgate his Decision thereon, or heard, En Banc, means "in addition to" (McCaull Webster Elevator Company versus Adams, 167
by the full membership of the BOC in which case the concurrence of at least two (2) of the Northwestern Reporter, 330, page 332). The word "and", whether it is used to connect
membership of the BOC is necessary for a valid Decision . . . . While it may be true that the words, phrases or full sentence[s], must be accepted as binding together and as relating to
aforesaid Rules of Procedure was promulgated before the effectivity of Executive Order one another . . . .
No. 546, however, the Rules of Procedure of BOC governed the rules of practice and In interpreting a statute, every part thereof should be given effect on the theory that it
procedure before the NTC when it was established under Executive Order No. 546. This was enacted as an integrated law and not as a combination of dissonant provisions. As the
was enunciated by the Supreme Court in the case of "Philippine Consumers Foundation, aphorism goes, "that the thing may rather have effect than be destroyed" . . . If it was the
Inc. versus National Telecommunications Commission, 131 SCRA 200" when it declared intention of President Marcos to constitute merely a single entity, a "one-man"
that: governmental body, instead of a commission or a three-man collegial body, he would not
The Rules of Practice and Procedure promulgated on January 25, 1978 by the Board of have constituted a commission and would not have specifically decreed that the
Communications, the immediate predecessor of respondent NTC . . . govern the rules of Commission is composed of, not the commissioner alone, but of the commissioner and
practice and procedure before the BOC then, now respondent NTC. . . . the two (2) deputy commissioners. Irrefragably, then, the NTC is a commission composed
not only of Kintanar, but Perez and Dumlao as well, acting together in the performance of
In the case of "Philippine Long Distance Telephone Company versus National their adjudicatory or quasi-judicial functions, conformably with the Rules of Procedure
Telecommunications, et al., 190 SCRA 717", the Supreme Court applied and cited Rule 15 and Practice promulgated by the BOC and applicable to the NTC.
of the Rules of Procedure and Practice of BOC . . . .
The barefaced fact that . . . of Executive Order 546 used the word "deputy" to designate
Hence, under its Rules of Procedure and Practice, the Respondent NTC, as its predecessor, the two (2) other members of the Commission does not militate against the collegiality of
the BOC, had consistently been and remains a collegial body. the NTC. . . . The collegiality of the NTC cannot be disparaged by the mere nominal
designation of the membership thereof. Indeed, We are convinced that such nominal
Respondents Kintanar's and NTC's pose that Respondent Kintanar, alone, is vested with designations are without functional implications and are designed merely for the purpose
authority to sign and promulgate a Decision of the NTC is antithetical to the nature of a of administrative structure or hierarchy of the personnel of the NTC. . . .
commission as envisaged in Executive Order No. 546. It must be borne in mind that a
Commission is defined as: In hindsight, even Secretary Garcia was in accord with the collegiality of the NTC when he
promulgated and issued Department Order No. 92-614 . . . Even then Commissioner
 82

Mariano Benedicto openly expressed his vehement opposition to the Department Order are attempts to validate the one-man rule in the NTC as executed by persons with the
of Secretary Garcia and opted to seek refuge in the opinion of the then Minister of Justice selfish interest of maintaining their illusory hold of power.
Puno . . . . It was only when Commissioner Benedicto resigned and Respondent Kintanar
was designated to replace Commissioner Benedicto that Secretary Garcia flip-flapped [sic], Since the questioned memorandum circulars are inherently and patently null and void for
and suddenly found it expedient to recall his Department Order No. 92-614 and authorize being totally violative of the spirit and letter of E.O. No. 546 that constitutes the NTC as a
Kintanar to decide, all by himself, all cases pending with the NTC in frontal violation of the collegial body, no court may shirk from its duty of striking down such illegal regulations.
Rules of Procedure and Practice before the NTC, more specifically Rule 15 thereof . . . . Third. In its certiorari action before the respondent Court of Appeals, private respondent
xxx xxx xxx BellTel was proceeding against the NTC and Commissioner Kintanar for the former's
adherence and defense of its one-man rule as enforced by the latter. Thus, only the NTC
The Respondents cannot find solace in House Bill No. 10558 to buttress their argument . . . and Commissioner Kintanar may be considered as indispensable parties. After all, it is they
because under the House Bill, the NTC is transformed into a collegial body. Indeed, We whom private respondent BellTel seek to be chastised and corrected by the court for
find Respondents' pose tenuous. For, it can likewise be argued, with justification, that having acted in grave abuse of their discretion amounting to lack or excess of jurisdiction.
House Bill No. 10558 indeed confirms the existing collegial nature of the NTC by so
expressly reaffirming the same. The oppositors in NTC Case No. 94-229 are not absolutely necessary for the final
determination of the issue of grave abuse of discretion on the part of the NTC and of
xxx xxx xxx Commissioner Kintanar in his capacity as chairman of NTC because the task of defending
them primarily lies in the Office of the Solicitor General. Furthermore, were the court to
In sum, then, We find and so declare that NTC Circular No. 1-1-93 . . . Memorandum find that certiorari lies against the NTC and Commissioner Kintanar, the oppositors' cause
Circular No. 3-1-93 . . . and the Order of Kintanar . . . declaring the NTC as a single entity or could not be significantly affected by such ruling because the issue of grave abuse of
non-collegial entity, are contrary to law and thus null and void and should be, as they are discretion goes not into the merits of the case in which the oppositors are interested but
hereby, set aside. 26 into the issue of collegiality that requires, regardless of the merits of a case, that the same
Second. Petitioners take us to task with their vigorous contention that respondent be decided on the basis of a majority vote of at least two members of the commission.
appellate court's act of nullifying NTC Memorandum Circular No. 1-1-93 issued by then The issue in this case is, it bears repeating, not the merits of the application of private
Commissioner Mariano Benedicto, Jr. and NTC Memorandum Circular No. 3-1-93 issued respondent BellTel for a provisional authority to operate what promises to be the most
also by then Commissioner Benedicto on January 6, 1993, was a collateral attack against technologically advanced telephone service in the country. This court is not in any way
the aforecited circulars and an unnecessary and abusive exercise of the court's power to concerned with whether or not private respondent BellTel's project proposal is technically
nullify administrative regulations. feasible or financially viable, and this court should not, in fact, delve into these matters
It must be remembered by petitioners, however, that administrative regulations derive which are patently outside of its review jurisdiction. All that respondent Court of Appeals
their validity from the statute that they were, in the first place, intended to implement. passed upon was the question of whether or not the NTC and Commissioner Kintanar
Memorandum Circulars 1-1-93 and 3-1-93 are on their face null and void ab initio for committed grave abuse of discretion, and so we must review and ascertain the
being unabashedly contrary to law. They were nullified by respondent Court of Appeals correctness of the findings of the respondent appellate court on this score, and this score
because they are absolutely illegal and, as such, are without any force and effect. The fact alone.
that implementation of these illegal regulations has resulted in the institutionalization of Thus, the claim of petitioners that there is here a case of non-joinder of indispensable
the one-man rule in the NTC, is not and can never be a ratification of such an illegal parties in the persons of all of the oppositors in NTC Case No. 94-229, is untenable.
practice. At the least, these illegal regulations are an erroneous interpretation of E.O. No.
546 and in the context of and its predecessor laws. At the most, these illegal regulations Fourth. Petitioners, in apparent paranoia, argue that what the respondent appellate court
has actually ordered, was that the NTC sit and meet en banc and forthwith grant private
 83

respondent BellTel's application for a provisional authority. Petitioners, however, have initialed by the CCAD Head, Engr. Edgardo Cabarios and by Deputy Commissioners Dumlao
obviously over-read the second part of the dispositive portion of the herein assailed and Perez. 28 The working draft is attached to the records of NTC Case No. 94-229 which
decision rendered by respondent Court of Appeals. may be borrowed by any person for any stated purpose. 29

There is no dispute that jurisprudence is settled as to the propriety of mandamus in Significantly, no one among the aforementioned persons has renounced the working draft
causing a quasi-judicial agency to exercise its discretion in a case already ripe for or declared it to be spurious. More importantly, petitioners have utterly failed to offer
adjudication and long-awaiting the proper disposition. As to how this discretion is to be proof of any illegality in the preparation or procurement of said working draft.
exercised, however, is a realm outside the office of the special civil action of mandamus. It
is elementary legal knowledge, after all, that mandamus does not lie to control discretion. The more critical point that matters most, however, is that we cannot be diverted from
the principal issue in this case concerning the collegiality of the NTC. In the ultimate, the
When the respondent Court of Appeals directed Commissioners Kintanar, Dumlao and issue of the procurement of the working draft is more apropos for a criminal or
Perez to meet en banc and to consider and act on the working draft of the order granting administrative investigation than in the instant proceedings largely addressed to the
provisional authority to BellTel, said court was simply ordering the NTC to sit and meet en resolution of a purely legal question.
banc as a collegial body, and the subject of the deliberation of the three-man commission
would be the said working draft which embodies one course of action that may be taken WHEREFORE, premises considered, the instant consolidated petitions are hereby
on private respondent BellTel's application for a provisional authority. The respondent DISMISSED for lack of merit.
Court of Appeals, however, did not order the NTC to forthwith grant said application. This Costs against petitioners.
is understandable since every commissioner of the three-man NTC has a vote each to cast
in disposing of private respondent BellTel's application and the respondent appellate SO ORDERED.
court would not pre-empt the exercise by the members of the commission of their
individual discretion in private respondent BellTel's case.

Respondent appellate court intends, however, for the NTC to promptly proceed with the
consideration of private respondent BellTel's application for provisional authority, for the
same has been ripe for decision since December, 1994. With the marked propensity of
Commissioner Kintanar to delay action on the said application and his insistent arrogation
of sole power to promulgate any and all NTC decisions, respondent Court of Appeals'
order for the NTC to sit and meet en banc to consider private respondent BellTel's
application for a provisional authority, attains deep significance.

Fifth. The accusation of petitioners that the working draft of the order granting provisional
authority to private respondent BellTel, was obtained by the latter through illegal means,
is a serious charge. However, not a single piece of evidence has been proffered by
petitioners to prove this charge.

Private respondent BellTel makes no secret of the source of the said working draft. In
private respondent BellTel's Urgent Ex-Parte Motion to Resolve Application and For
Issuance of Provisional Authority, it is alleged that said working draft was prepared by
Atty. Basilio Bolante of the Legal Department of the NTC. 27 Said working draft was
 84

G.R. No. 139303 August 25, 2005 A copy of the Decision was received by counsel for petitioners on June 22, 1998. On July 3,
1998, they filed a Notice of Appeal with the RTC. It was approved on July 7, 1998.
Cipriano Enriquez, Raymundo Enriquez, Concepcion Enriquez, assisted by her husband
Matias Quitanes, Tomas Enriquez, Luis Diaz, Cesar Diaz, Manuel Diaz, Domingo Enriquez, On February 3, 1999, the Court of Appeals dismissed the appeal of petitioners for their
Elpidio Enriquez, Filipina Enriquez, Casimira Dizon, Saturnino Dizon, Jose Ramos, Amado failure to pay the appellate court docket fee, thus:
Mislang, Antonio Quitaneg, Villamor Quitaneg, Jimmy Clavo, Oscar Laborce, Sevilla
Pizarro, Angelita Pizzaro, Isidro Rico, Pio Famisan, Pantaleon Abille, Beinvenido Corum, "For failure to pay docket fee, the appeal is deemed ABANDONED and DISMISSED,
Martina Hisole, Erna D. Enriquez, assisted by her husband Ritchie Flauta, and Ignacio pursuant to Section 1(c), Rule 50, Revised Rules of Court."
Enriquez, Jr., Petitioners, Petitioners filed a motion for reconsideration but it was denied by the Appellate Court in a
vs. Resolution dated July 7, 1999, thus:
MAXIMO ENRIQUEZ (now deceased), substituted by CARMEN AGANA, IGMIDIO
ENRIQUEZ, CONCEPCION ENRIQUEZ, CIPRIANO ENRIQUEZ, DIONISIONENRIQUEZ, "Per copy of the official receipt attached to appellants’ motion for reconsideration, the
MAXIMO ENRIQUEZ, CLEOFE ENRIQUEZ, TOMAS ENRIQUEZ, RAYMUNDO ENRIQUEZ and docket fee was paid on November 4, 1998 or 4 months after the notice of appeal was filed
NICOLAS ENRIQUEZ, Respondents. on July 3, 1998.

DECISION Consequently, appellants’ motion for reconsideration is hereby denied."

SANDOVAL-GUTIERREZ, J.: In the instant petition for review, petitioners raise the following errors allegedly
committed by the Appellate Court:
Assailed in the instant petition for review on certiorari are the Resolutions dated February
3, 1999 and July 7, 1999 issued by the Court of Appeals in CA-G.R. CV UDK-7011 dismissing "I. The respondent Court of Appeals seriously erred in considering petitioners’ appeal as
the appeal of petitioners for their failure to pay the appellate court docket fee. deemed abandoned and dismissed for alleged failure of petitioners to pay docket fee.

On November 17, 1988, Maximo Enriquez, later substituted by his heirs (now II. the respondent Court of Appeals gravely erred in denying petitioners’ motion for
respondents), filed with the Regional Trial Court (RTC), Branch 71 of Iba, Zambales a reconsideration of the resolution considering petitioners’ appeal as deemed abandoned
complaint for partition against petitioners, docketed as Civil Case No. RTC-568-1. The and dismissed on the ground that the docket fee was paid on November 4, 1998, or four
complaint involves a parcel of land situated at Amungan, Iba, same province, covered by (4) months after the notice of appeal was filed on July 3, 1998.
TCT No. T-28593, with an area of 44,984 square meters. He alleged that he owns 10/18
undivided portion of the property, 9/18 by purchase and 1/18 by inheritance; and that III. the respondent Court of Appeals in issuing the aforesaid resolutions gave premium on
petitioners have been residing in the premises without his knowledge and consent, technicalities rather on substance and substantial justice and disregarded the merits of
thereby depriving him of his undivided share of the property. petitioners’ case."

Petitioners, in their answer, averred that Cipriano Enriquez, one of the petitioners, owns ½ In sum, the issue is whether the Court of Appeals correctly dismissed the petition for
of the property, while the others are in possession of the other areas with his knowledge failure of the petitioners to pay appellate court docket fee.
and consent. In dismissing petitioners’ appeal, the Court of Appeals cited Section 1(c), Rule 50 of the
On June 4, 1998, the RTC rendered a Decision ordering the petitioners to vacate the Revised Rules of Court which provides:
property and to surrender possession thereof to respondents. "Section 1. Grounds for dismissal of appeal. – An appeal may be dismissed by the Court of
Appeals, on its own motion or on that of the appellee, on the following grounds:
 85

xxx The use of the word "shall" underscores the mandatory character of the Rule. The term
"shall" is a word of command, and one which has always or which must be given a
(c) Failure of the appellant to pay the docket and other lawful fees as provided in Section 4 compulsory meaning, and it is generally imperative or mandatory.4 Petitioners cannot give
of Rule 41." a different interpretation to the Rule and insist that payment of docket fee shall be made
Petitioners admit that the governing Rule on their payment of appellate court docket fee only upon their receipt of a notice from the trial court to pay. For it is a rule in statutory
is Section 4, Rule 41 of the 1997 Rules of Civil Procedure, as amended, which provides: construction that every part of the statute must be interpreted with reference to the
context, i.e., that every part of the statute must be interpreted together with the other
"Section 4. Appellate court docket and other lawful fees. – Within the period for taking an parts, and kept subservient to the general intent of the whole enactment.5 Indeed,
appeal, the appellant shall pay to the clerk of the court which rendered the judgment or petitioners cannot deviate from the Rule.
final order appealed from, the full amount of the appellate court docket and other lawful
fees. Proof of payment of said fees shall be transmitted to the appellate court together Also under Rule 41 of the same Rules, an appeal to the Court of Appeals from a case
with the original record of the record or the record on appeal." decided by the RTC in the exercise of the latter’s original jurisdiction, shall be taken within
fifteen (15) days from the notice of judgment or final order appealed from. Such appeal is
Underscoring the sentence "Proof of payment of said fees shall be transmitted to the made by filing a notice thereof with the court that rendered the judgment or final order
appellate court together with the original record or the record on appeal," petitioners and by serving a copy of that notice upon the adverse party. Furthermore, within this
maintain that the trial court must first send them a notice to pay the appellate court same period, appellant shall pay to the clerk of court which rendered the judgment or
docket fee and other lawful fees within the period for taking an appeal. Hence, they final order appealed from, the full amount of the appellate court docket and other lawful
waited for the notice for them to pay the appellate court docket fee. When they did not fees. The payment of docket fee within this period is mandatory for the perfection of
receive any, they paid the docket fee to the trial court. Consequently, they cannot be appeal. Otherwise, the appellate court would not be able to act on the subject matter of
faulted if they paid the appellate court docket fee four (4) months after their Notice of the action, and the decision sought to be appealed from becomes final and executory.6
Appeal was approved on July 7, 1998.
Time and again, this Court has consistently held that payment of docket fee within the
Prior to the effectivity of the 1997 Rules of Civil Procedure, as amended, payment of prescribed period is mandatory for the perfection of an appeal. Without such payment,
appellate court docket fee is not a prerequisite for the perfection of an appeal. In Santos the appellate court does not acquire jurisdiction over the subject matter of the action and
vs. Court of Appeals,1 this Court held that although an appeal fee is required to be paid in the decision sought to be appealed from becomes final and executory.7
case of an appeal taken from the Municipal Trial Court to the Regional Trial Court, it is not
a prerequisite for the perfection of an appeal under Sections 202 and 233 of the Interim Petitioners argue that the Appellate Court, in issuing the assailed Resolutions, gave
Rules and Guidelines issued by this Court on January 11, 1983 implementing the Judiciary premium to technicalities rather than substance and disregarded the merits of the
Reorganization Act of 1981 (B.P. Blg. 129). Under these sections, there are only two petition. They ask for a liberal construction of the Rules.
requirements for the perfection of an appeal, to wit: (a) the filing with the trial court of a Appeal is not a right but a statutory privilege, thus, appeal must be made strictly in
notice of appeal within the reglementary period; and (b) the expiration of the last day to accordance with the provision set by law.
appeal by any party. The requirement of the law under Section 4, Rule 41 is clear. The payment of appellate
However, the 1997 Rules of Civil Procedure, as amended, which took effect on July 1, docket fee is not a mere technicality of law or procedure but an essential requirement for
1997, now require that appellate docket and other lawful fees must be paid within the the perfection of an appeal.8
same period for taking an appeal. This is clear from the opening sentence of Section 4, The payment of the docket fee within the period is a condition sine qua non for the
Rule 41 of the same Rules that, "(W)ithin the period for taking an appeal, the perfection of an appeal. Contrary to petitioners’ submission, the payment of the appellate
appellant shall pay to the clerk of the court which rendered the judgment or final order court docket and other lawful fees is not a mere technicality of law or procedure. It is an
appealed from, the full amount of the appellate court docket and other lawful fees."
 86

essential requirement, without which the decision or final order appealed from would
become final and executory as if no appeal was filed at all. 9

This Court has consistently ruled that litigation is not a game of technicalities and that
every case must be prosecuted in accordance with the prescribed procedure so that issues
may be properly presented and justly resolved. The rules of procedure must be faithfully
followed except only when, for persuasive and weighting reasons, they may be relaxed to
relieve a litigant of an injustice commensurate with his failure to comply within the
prescribed procedure. Concomitant to a liberal interpretation of the rules of procedure
should be an effort on the part of the party invoking liberality to adequately explain his
failure to abide by the rules.10 Anyone seeking exemption from the application of the Rule
has the burden of proving that exceptionally meritorious instances exist which warrant
such departure.11

In the present case, petitioners failed to establish any sufficient and satisfactory reason to
warrant a relaxation of the mandatory rule on the payment of appellate court docket fee.
Actually, the payment of the required docket fee was late because of the erroneous
interpretation of the Rule by petitioners’ counsel. Verily, to grant their petition would be
putting a premium on his ignorance or lack of knowledge of existing Rules. He should be
reminded that it is his duty to keep abreast of legal developments and prevailing laws,
rules and legal principles,12 otherwise his clients will be prejudiced, as in this case.

In fine, the Court of Appeals did not err in dismissing petitioners’ appeal.

WHEREFORE, the instant petition for review on certiorari is DENIED. Costs against
petitioners.

SO ORDERED.
 87

G.R. No. L-18615 December 24, 1963 thereof:Provided, furthermore, That the court where the criminal action or civil action for
damages is first filed, shall acquire jurisdiction to the exclusion of other courts; And
AMANDO M. DIZON, plaintiff-appellant, provided, finally, That this ammendmentshall not apply to cases of written defamations,
vs. the civil and/or criminalactions to have been filed in court at the time of the effectivity of
DEMETRIO ENCARNACION, defendant-appellee. hislaw..
A.M. Dizon and Associates for plaintiff-appellant. which, as contendent by the defendant, was constuend by the lower court to mean: .
A.J. Fransisco and A.J. Fransisco for defendant-appellee.
... that when any of the accused or any of the offended of the parties resides in a province
CONCEPCION, J.: or city where a written defamation is published,circulated, displayed or exhibited, the
Plaintiff Amando M. Dizon seeks the review of an order of the Court of FirstInstance of action, civil or criminal, shall be filed simultaneously or separately with the court of first
Pampanga dismissing the complaint herein, without costs, upon the ground that venue instance of said province or but when the offender or any of the offenders or the
had been improperly laid.. offended party or any of the offended parties does not reside in a province or city, where
the publication, circulation, display or exhibition were made, such action must be
In a complaint filed with said court, plaintiff, a resident of Pampanga, seeks to recover interposed therein..
from defendant Demetrio B. Encarnacion the aggregate sum of P50,000.00, by way of
damages allegedly suffered by the former in consequenceof the filing by the latter, in We find ourselves unable to concur in this view. The language of the above quoted
Special Proceeding No. 2025 of the Court of First Instance of Zambales, entitled "Inestate provision is, to our mind, plain and clear. It establishes a general rule and an exception
Estate of the Deceased AgustinN. Medina," of a pleading captioned "Manifestation and thereto. Civil actions for damages in cases of written defamation "shall" be filed with the
Refutation," containingstatements which are said to be libelous and deragatory to dignity, court of first instance of the province or city in which "any of the accused or "any of the
integrity,reputation and standing of the former, as well as irrelevant to the issues in said offended paries resides."In other words, the plaintiff is limited in his choice of venue to
special proceeding.. the court of first instance of his residence or to that of any of the accused. Plaintiffmay not
file the action elsewhere, unless the libel is published, circulated,displayed, or exhibited in
In due course, the defendant moved to dismiss the case upon the theory that, pursuant to a province or city wherein neither the offender northe offended party resides, in which
Art. 360 of the revised Penal Code, as ammended by Republic ActNo. 1289, plaintiff's case "the civil criminal actions may be brought in the court of first instance thereof." The
action should be instituted in the Court of First Instance of Zambales, in which said verb "may" is permissive.Hence, it does not necessarily imply a complete abrogation of
"Manifestation and Refutation", had been filed. The motion was granted by the Court of the general rule laid down in the preceeding sentence, except in sofar as it broadens
First Instance of Pampanga,which accordingly dismissed the present case, without thetwo (2) alternatives therein set forth, by giving the plaintiff a third choiceof venue.
prejudice to its renewalin the "proper court." A reconsideration of the order to this effect .lawphil.net
havingbeen denied, plaintiff has brought the case to us by record on appeal..
Although the term "may" should be taken as "must" or "shall" when the intention of the
The appeal hinges on said provision of the Revised Penal Code, as ammended by Republic law maker to give thereto a mandatory or compolsary meaningis patent or manifest, no
Act. No. 1289, the pertinent part of which reads: ... The criminal and civil action for such intent appears insofar as the above provisionis concerned. On the contrary, the use
damages in cases of written defamation as provided for in this chapter, shall be filed of the word "may" in the first, clearlysuggest that Congress meant the second sentence to
simultaneously or separately with the court of First instance of the province or city where be merely permissive, notmandatory. Indeed, when the libelous imputation has not been
any of the accused or any of the offended parties resides at the time of the commission of published or circulated in the locality wherein either of the parties resides, the
the offense: Provided, however, That where the libel is published, circulated, displayed, or offendedparty may not wish to initiate the action therein, for the same would have the
exhibited in a province or a citywherein neither the offender or nor the offended the party the effect of giving the additional publicity to the derogatory, and of increasing the harm
resides the civil and criminal actions may be brought in the court of first Instance already caused to the complainant. As a consequence, he "may" prefer to file suit where
 88

the libel had actually been published or circulated. Hence, the provision of this effect has
been established, in our opinion, for his benefit, which he may waive..

Otherwise, if the complainant were a resident of Jolo and the defendant,residing in Cebu,
had defamed him in Batanes, it would be necessary to bringthe action in the latter
province, thereby imposing upon the average memberof the community a serious
hindrance to the vindication of his most preciouspossession - his good name and
reputation. In fact, if the theory advanced by the appellee were upheld, the defendants
could purposely choose to publish and circulate their defamatory imputations in a place
far away from where they and the offended parties resides in order to make it convenient,
if not well-nigh impossible for the letter to sue the former for redress of the
wrongcommitted them. Neither the language of the law nor the adduced by herein
appellee warrant the belief that Congress intended to create such obstacles to the
prosecution of those guilty of the crime of libel..

WHEREFORE, the order appealed from is set aside and the case hereby remanded to the
lower court further proceedings, with the costs of this instance against the appellee. It is
so ordered..
 89

G.R. No. 116695 June 20, 1997 later, petitioners filed another motion pleading for the admission of an amended answer.
On September 23, 1993, the MTCC denied the motions and considered the case submitted
VICTORIA G. GACHON and ALEX GUEVARA, petitioners, for resolution.7 On October 27, 1993, the MTCC also denied the petitioners' motion for
vs. reconsideration.8 Thereafter, on November 26, 1993, the MTCC9 issued a
HON. NORBERTO C. DEVERA, JR., Presiding Judge, Branch XXIV, RTC, Iloilo City; HON. decision 10 resolving the complaint for forcible entry in favor of herein private
JOSE R. ASTORGA, Presiding Judge, Branch I, Municipal Trial Court in Cities, Iloilo City; respondents.
and SUSANA GUEVARA, represented by her attorney-in-fact, ROSALIE
GUEVARA, respondents. Instead of filing an appeal, petitioners filed a petition for certiorari and injunction before
the Regional Trial Court (RTC) of Iloilo City, 11 Branch 24, praying mainly that the MTCC be
ordered to admit the amended answer and to conduct further proceedings in the civil
PANGANIBAN, J.: case for forcible entry. As prayed for, a temporary restraining order was issued by the
RTC.
May the Rule on Summary Procedure be interpreted liberally to allow the admission of an
answer filed out of time due to alleged "oversight"? Thereafter, the RTC issued the assailed Decision 12 dismissing the petition. Respondent
Judge Norberto E. Devera, Jr. ratiocinated: 13
This is the main legal question raised in this petition for review assailing the Decision of
the Regional Trial Court of Iloilo City, Branch 24,1 which dismissed a special civil action Section 36 of Batas Pambansa Blg. 129, otherwise known as The Judiciary Reorganization
for certiorari and injunction filed by herein petitioners. The dispositive portion of the Act of 1980 provides, among others, as follows:
assailed RTC Decision reads:2 Sec. 36 — Summary Procedures in Special Cases . . . The Supreme Court shall adopt special
WHEREFORE premises considered, the prayer for the issuance of a writ of preliminary rules or procedures applicable to such cases in order to achieve an expeditions (sic) and
injunction is denied and, with respect to the merits, the instant case is hereby ordered inexpensive determination thereof without regard to technical rules. Such simplified
dismissed. procedures may provide that affidavits and counter-affidavits may be admitted in lieu of
oral testimony and that the periods for filing pleadings shall be non-extendible.
Double costs against petitioners.
Pursuant to the aforequoted legislative mandate, the Supreme Court promulgated the
Facts Rule on Summary Procedure, the pertinent provisions of which, as related to the issues
raised in this case, are hereunder set forth —
The factual antecedents of this case as found by the Regional Trial Court are undisputed
and admitted as correct by the parties. A complaint for forcible entry3 was filed by Private II — Civil Cases
Respondent Susana Guevara against Patricio Guevara and Petitioners Victoria Gachon and
Alex Guevara before the Municipal Trial Court for Cities (MTCC) of Iloilo City. Summons Sec. 3. Pleadings
was served on and received by petitioners on August 25, 1993, directing them to file an A. (P)leadings allowed — The only pleadings allowed to be filed are the complaints,
answer within the reglementary period of ten (10) days. Patricio Guevara was abroad at compulsory counter-claims and cross-claims pleaded in the answer, and the answers
that time; hence, the MTCC did not acquire jurisdiction over him. On September 4, 1993, thereto
petitioners filed with the MTCC an urgent motion for extension of time to file an
answer.4 On September 7, 1993, the MTCC denied the motion on the ground that it was a xxx xxx xxx
prohibited pleading under the Rule on Summary Procedure.5 On September 8, 1993, or
more than ten days from their receipt of the summons, petitioner submitted an urgent Sec. 5. Answer — Within ten (10) days from service of summons, the defendant shall file
motion praying for the admission of their answer,6 which was attached thereto. Two days his answer to the complaint and serve a copy thereof on the plaintiff . . .
 90

Sec. 6. Effect of Failure to answer — Should the defendant fail to answer the complaint prejudice to private respondent has been claimed or alleged by reason of the delay" in
within the period above provided, the Court, motu proprio, or on motion of the plaintiff, filing an answer. 16 Petitioners also argue that their defense in the action for forcible entry
shall render judgment as may be warranted by the facts alleged in the complaint and is based on substantial grounds, because they "were in prior physical possession of the
limited to what is prayed for therein: . . . premises subject of the action and that their houses have long been standing on the land
in question because the land on which said houses are standing are (sic) the common
xxx xxx xxx properties of the parties."
Sec. 19. Prohibited Pleadings and Motions — The following pleadings, motions, or Citing Section 2, Rule 1 17 of the Rules of Court, petitioners pray that the provisions in the
petitions shall not be allowed in the cases covered by this Rule: Rule on Summary Procedure regarding prohibited pleadings and the period for filing an
(a) Motion for extension of time to file pleadings, affidavits or any other paper. answer be given liberal interpretation. Petitioners concede that said provisions appear to
be couched in mandatory language. They contend, however, that other similarly worded
xxx xxx xxx provisions in the Rules of Court have nonetheless been liberally applied by this Court to
promote substantial justice. 18
The foregoing should underscore quite clearly the reality that the ten-day-period to file an
answer reckoned from the date of the receipt of the summons is mandatory and no Private respondent, on the other hand, submits that the provisions in question have to be
reason of any kind is acceptable to operate as an excuse. The rule is explicit. It is strictly construed in order to avoid delay, considering that the Rule on Summary
addressed more, being one of procedure, to counsels than to litigants. Counsels, therefore Procedure is aimed at inexpensive, expeditious and summary determination of
cannot assert the validity of their client's cause to evade the mandate of the law. cases. 19 Private respondent adds that the petition can also be dismissed on the ground of
violation of Revised Circular 28-91 on forum shopping, because three (3) months after the
Accordingly, the Court cannot fault the respondent judge [referring to Judge Jose R. rendition of the assailed Decision, a "petition for quieting of title and partition, and
Astorga] in acting the way he did in Civil Case No. 130 (93) taking into account the damages, involving the same parcel of residential land (Cadastral Lot No. 709 . . . ), was
admitted facts and circumstances. filed . . . docketed as Civil Case No. 21618, by (Petitioner) Victoria Guevara-Gachon
Hence, this petition directly filed before this Court. (. . .), Patricio Guevara (father of Petitioner Alex Guevara), Lilia Guevara-Doreza and Fe
Guevara-Burgos against herein private respondent." Private respondent contends that the
The Issues subsequent case is the appropriate forum where ownership of the property in question
may be threshed out. 20
Petitioners submit for resolution the following questions of law: 14
As observed at the outset, the issue to be resolved is whether, under the undisputed facts
I. Are the provisions of the Rules on Summary Procedure on the period of pleadings to be of this case, the Rule on Summary Procedure may be liberally construed in order to allow
applied STRICTLY or LIBERALLY. the admission of petitioners' answer which unquestionably was filed beyond the
reglementary period.
II. What is the legal effect of a belated answer under the Rules on Summary Procedure.
Preliminary Matter
Petitioners argue that the "technical rules of procedure must yield to the higher interest
of justice." Petitioners explain that they filed the motion for extension of time to file an It bears noting that petitioners filed directly before this Court a petition for review
answer, a prohibited pleading under the Rule on Summary Procedure, because of assailing the RTC Decision. This remedy is allowed under paragraph 2 of Circular 2-
"oversight. That was why immediately upon receipt of the denial of that motion, 90 21 which provides:
petitioners filed their motion to admit answer which was later verified and had to be
amended. All these (actions) were done in a period of five (5) days from the lapse of the Sec. 2. Appeals from Regional Trial Courts to the Supreme Court. — Except in criminal
reglementary period to file an answer." 15 Furthermore, petitioners contend that "no cases where the penalty imposed is life imprisonment or reclusion perpetua, judgments of
 91

regional trial courts may be appealed to the Supreme Court only by petition for review As a general principle, rules prescribing the time within which certain acts must be done,
on certiorari in accordance with Rule 45 of the Rules of Court in relation to Section 17 of or certain proceedings taken, are considered absolutely indispensable to the prevention of
the Judiciary Act of 1948, as amended, 22 this being the clear intendment of the provision needless delays and to the orderly and speedy discharge of judicial business. By their very
of the Interim Rules that "(a)ppeals to the Supreme Court shall be taken by petition nature, these rules are regarded as mandatory. 25
for certiorari which shall be governed by Rule 45 of the Rules of Court.
The Rule on Summary Procedure, in particular, was promulgated for
Petitioners ask the Court to interpret a provision of the Rule on Summary Procedure. This the purpose of achieving "an expeditious and inexpensive determination of cases." 26 For
is a pure question of law that may be properly raised in this petition for review. this reason, the Rule frowns upon delays and prohibits altogether the filing of motions for
extension of time. Consistent with this reasoning is Section 6 of the Rule which allows the
The Court's Ruling trial court to render judgment, even motu proprio, upon the failure of a defendant to file
The petition has no merit. an answer within the reglementary period.

First Issue: Interpretation of the Period Indeed, the Judiciary Reorganization Act of 1980, mandating the promulgation of the Rule
on Summary Procedure, authorizes the Court to stipulate that the period for filing
The pertinent provisions of the Rule on Summary Procedure are as follows: pleadings in cases covered by the Rule on Summary Procedure shall be "non-
extendible." 27
Sec. 5. Answer. — Within ten (10) days from service of summons, the defendant shall file
his answer to the complaint and serve a copy thereof on the plaintiff . . . Furthermore, speedy resolution of unlawful detainer cases is a matter of public
policy, 28 and this rule should equally apply with full force in forcible entry cases where the
Sec. 6. Effect of failure to answer. — Should the defendant fail to answer the complaint possession of the premises at the start is already illegal.
within the period above provided, the Court, motu proprio, or on motion of the
plaintiff, shall render judgment as may be warranted by the facts alleged in the complaint From the foregoing, it is clear that the use of the word "shall" in the Rule on Summary
and limited to what is prayed for therein: . . . Procedure underscores the mandatory character of the challenged provisions. Giving the
provisions a directory application would subvert the nature of the Rule on Summary
xxx xxx xxx Procedure and defeat its objective of expediting the adjudication of suits. Indeed, to admit
Sec. 19. Prohibited pleadings and motions. — The following pleadings, motions, or a late answer, as petitioners suggest, is to put premium on dilatory maneuvers — the very
petitions shall not be allowed in the cases covered by this Rule: mischief that the Rule seeks to redress. In this light, petitioners' invocation of the general
principle in Rule 1, Section 2 of the Rules of Court is misplaced.
(a) Motion for extension of time to file pleadings, affidavits or any other paper.
Other than a plea for the liberal interpretation of the Rule on Summary Procedure,
xxx xxx xxx petitioners do not provide an adequate justification for the admission of their late answer.
"Oversight," which they candidly cite as the reason for their filing a motion for extension
(Emphasis supplied.) of time to file an answer, is not a justification. Oversight, at best, implies negligence; at
worst, ignorance. The negligence displayed by petitioners is clearly inexcusable; ignorance
The word "shall" ordinarily connotes an imperative and indicates the mandatory character
of so basic a rule, on the other hand, can never be condoned. In either case, the directory
of a statute. 23 This, however, is not an absolute rule in statutory construction. The import
application of the questioned provision is not warranted.
of the word ultimately depends upon a consideration of the entire provision, its nature,
object and the consequences that would follow from construing it one way or the other. 24 Petitioners also cite Rosales vs. Court of Appeals 29 and Co Keng Kian vs. Intermediate
Appellate Court, 30 but these cases do not support their position.
 92

In Rosales vs. Court of Appeals, 31 this Court applied the Rule on Summary Procedure by petitioner, this could only be due to petitioner's blatant attempts at evasion which
liberally when the defendant, instead of filing an answer, filed within the reglementary compelled the new landlord to resort to registered mail. The Court cannot countenance
period a pleading labeled as a motion to dismiss. In treating the motion to dismiss as an an unfair situation where the plaintiff in an eviction case suffers further injustice by the
answer, the Court ruled: 32 unwarranted delay resulting from the obstinate refusal of the defendant to acknowledge
the existence of a valid demand.
Parenthetically, petitioner argues in the present petition that, notwithstanding its being
labeled as a motion to dismiss, said pleading should have been considered as his answer In both cases, there was substantial compliance with the law, something that cannot be
pursuant to the liberal interpretation accorded the rules and inasmuch as the grounds said of herein petitioners.
involved therein also qualify as defenses proper in an answer. In this instance the Court
agrees. Indeed, the rule on summary procedure was conceptualized to facilitate the Second Issue: Forum-Shopping
immediate resolution of cases such as the present one. Well-settled is the rule that Private respondent assails petitioners for engaging in forum-shopping by pursuing the
forcible entry and detainer cases being summary in nature and involving disturbance of present ejectment suit, notwithstanding the pendency of an action for quieting of title
social order, procedural technicalities should be carefully avoided and should not be involving the same property and parties. We are unable to find basis for this charge.
allowed to override substantial justice. With this premise in mind and having insisted,
however erroneously, on its jurisdiction over the case, it certainly would have been more For forum-shopping to exist, both actions must involve the same transactions, essential
prudent for the lower court to have treated the motion to dismiss as the answer of facts and circumstances; and the actions must raise identical causes of action, subject
petitioner and examined the case on its merits. As will be shown shortly, the long drawn matter, and issues. 35 Suffice it to say that an action for quieting of title and partition has a
out proceedings that took place would have been avoided. different cause of action than that in an ejectment suit. As private respondent herself
contended, ownership of a certain portion of the property which is determined in a case
Furthermore, the said case did not involve the question of extension in the period for of partition does not necessarily mean that the successful litigant has the right to possess
filing pleadings under the Rule on Summary Procedure. the property adjudged in his favor. In ejectment cases, the only issue for resolution is
In Co Keng Kian vs. Intermediate Appellate Court, 33 this Court allowed the notice to physical or material possession of the property involved, independent of any claim of
vacate, served upon the tenant, by registered mail instead of personal service as required ownership set forth by any of the party litigants. Anyone of them who can prove prior
by the Rules of Court. We thus ruled: 34 possession de facto may recover such possession even from the owner himself. This rule
holds true regardless of the character of a party's possession, provided that he has in his
At this juncture it bears repeating that actions for forcible entry and unlawful detainer are favor priority of time which entitles him to stay on the property until he is lawfully ejected
summary in nature because they involve a disturbance a social order which must be by a person having a better right by either accion publiciana or accion reivindicatoria. 36 It
abated as promptly as possible without any undue reliance on technical and procedural has even been ruled that the institution of a separate action for quieting of title is not a
rules which only cause delays. In the ultimate analysis, it matters not how the notice to valid reason for defeating the execution of the summary remedy of ejectment. 37
vacate was conveyed, so long as the lessee or his agent has personally received the
written demand, whether handed to him by the lessor, his attorney, a messenger or even WHEREFORE, in view of the foregoing, the petition is DENIED and the assailed Decision is
a postman. The undisputed facts in the instant case show that the Manila Times AFFIRMED in toto. Double costs against petitioners.
Publishing Company, through its manager, had informed petitioner that Plaza Arcade Inc. SO ORDERED.
was the new owner of the subject building; that on October 18, 1979, a demand letter
was sent to petitioner advising him to leave the premises but petitioner refused to receive
the letter; that a second demand on January 12, 1981 elicited the same reaction; that a
final demand dated November 16, 1981 was sent to petitioner by registered mail which he
again refused. And even on the supposition that there was no personal service as claimed
 93

G.R. No. L-24583 October 29, 1966 shift responsibility for irregularities to the protestant and his followers, impugning in view
thereof the results in some thirteen precincts.
MAGDALENA SIBULO VDA. DE MESA, widow of the late Francisco de Mesa, JUAN
GILBUENA, DR. PEDRO MOLERA, DEMETRIO PRESNEDI and LUCIO VICTA, as Officers and On March 18, 1964, however, an assassin's bullet felled De Mesa, and, forthwith, vice-
in representation of the Local Chapter of the Liberal Party in Muntinlupa, Rizal, and mayor Loresca was, by operation of law, duly installed as his successor. Notice of De
DEMETRIO R. LORESCA, petitioners, Mesa's demise was given on April 22, 1964 to the court a quo thru a "Constancia" filed by
vs. the decedent's counsel of record, in which they also indicated their belief that, by reason
HON. EULOGIO MENCIAS and/or Judge of the Court of First Instance of Rizal, MAXIMINO of said death, their authority as such counsel was terminated.
A. ARGANA, the CHIEF OF POLICE, and the MUNICIPAL TREASURER, both of Muntinlupa,
Rizal, respondents. In the election case, meanwhile, the protestant Argana moved for the constitution of
committees on revision of ballots. Expressly to hear protestee's view thereon and to
Jovito R. Salonga and Neptali A. Gonzales for petitioners. afford him a chance to propose his commissioners, this motion was set for hearing but,
Jose W. Diokno for respondents. quite understandably, no appearance was entered for the deceased protestee.
Accordingly, on May 6, 1964, the court a quo required the protestee's widow and children
CASTRO, J.: to appear within fifteen days from notice in order to be substituted for said protestee, if
In this petition for certiorari with preliminary injunction, the petitioners ask this Court to they so desired. They did not, however, comply. Taking no further action in the premises,
review a three-to-two decision rendered by a special division of the Court of Appeals on the trial court left the matter at that.
March 26, 1965 in C.A. 35019-R, sustaining the validity of the proceedings had and taken Then proceeding ex parte, on June 11, 1964, the protestant Argana reiterated his move
by the Court of First Instance of Rizal in election case 7924 before it (Maximino A. Argana, for the appointment of commissioners on revision of ballots, but this time without
protestant vs. Francisco De Mesa, protestee). The issue of nullity of the judgment proposing any provision for representation for the protestee whose widow and children
promulgated in the said election case was elevated to the Court of Appeals on a petition he sought to be declared "non-suited." On June 23, 1964, without notice to the protestee
for certiorari and mandamus, upon the contention that the said court of first instance and/or his legal representative — as indeed none had thus far been named — the trial
illegally and incorrectly did not allow the substitution of the present petitioners as parties court granted the motion aforesaid.
for De Mesa, after the latter's death, and thereafter denied due course to their appeal
from the said judgment. With the constitution of the committee on revision of ballots in which, incidentally,
Ramon Antilon Jr. was motu proprio named and then served as commissioner for the
The antecedent facts are not complicated. deceased protestee, the completion of the proceedings on revision, and the submission of
Opponents for the mayoralty of Muntinlupa, Rizal in the 1963 elections were Francisco De the report thereon, the trial court, in its decision of August 10, 1964, adjudged the
Mesa and Maximino A. Argana. The electorate's choice, as tallied by the local board of protestant Maximino A. Argana as the duly elected mayor of Muntinlupa, Rizal in the 1963
canvassers, was De Mesa. Elected vice-mayor with him was Demetrio R. Loresca. Duly, elections, and taxed the costs and expenses of the protest against the estate of the
proclaimed elected, these two qualified and assumed their respective positions upon the deceased protestee Francisco De Mesa.
commencement of their term of office. On August 17, 1964, within the reglementary period for the finality of the decision
Meanwhile and in due season, defeated candidate Argana, charging the perpetration of aforesaid, a three-pronged move was taken by De Mesa's widow, Magdalena Sibulo Vda.
frauds, terrorism and other irregularities in certain precincts, protested the election of De de De Mesa, and the local chapter of the Liberal Party of which the deceased protestee
Mesa, which protest was docketed as election case 7924, supra, in the Court of First was a member, thru its president and secretary. First, they sought leave to represent the
Instance of Rizal, the Honorable Eulogio Mencias presiding. In his return to the protest, De deceased protestee, invoking specifically said protestee's interest to keep his political
Mesa traversed the charges, and, in a counter-protest incorporated therein, sought to opponent out of the contested office in order to maintain his successor therein, which
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interest was not abated by his death; second, they moved for the reconsideration of the the petitioners' appeal from the decision in said case. Upon bond duly filed and approved,
August 10, 1964 decision and/or for new trial based, inter alia, upon the ground that, for the Court of Appeals issued the writ of preliminary injunction prayed for. However, upon
failure to order the protestant to procure the appointment of a legal representative of the respondents' motion and over the opposition of the petitioners, the effect of said writ was
deceased protestee after his widow and children had failed to appear, pursuant to the temporarily suspended until the case was finally decided by the Court of Appeals.
applicable provisions of the Rules of Court, it was legally improper for the trial court to
have proceeded ex parte with the election case; and third, they filed a "Cautionary Notice Appropriate proceedings having been had in the case, the latter court, besides finding the
of Appeal" in anticipation of the possible denial of their said motion for reconsideration inapplicability to election cases of the provisions of Section 17, Rule 3 of the Rules of Court
and new trial. on substitution of parties in case of death, opined that the petitioners likewise lacked the
legal standing and/or capacity to appear in election case 7924 aforesaid and/or to appeal
Pleading lack of personality both of De Mesa's widow and the local Liberal Party Chapter from the decision rendered therein, and that furthermore while the petitioner Loresca
to intervene in the case, as well as the absence of any ground for a new trial, the may have had such personality he nevertheless failed to timely invoke the same to protect
protestant opposed the foregoing moves. To the opposition, the movant below filed their his interests. Accordingly, it denied the petition for certiorari and mandamus and
reply. consequently permanently dissolved the writ of preliminary injunction theretofore issued.

On September 25, 1964 the court a quo, subscribing to the position taken by the Hence, the present recourse.
protestant, denied the movants' petition for leave to represent the deceased protestee,
and order stricken from the record their motion for reconsideration and new trial and The vital issue, to which all other issues appear to be subsidiary, is the determination of
their cautionary notice of appeal. the legal effect of the proceedings taken by the trial court in the election contest before it
subsequent to the demise of the protestee De Mesa.
On October 6, 1964 Argana qualified as mayor and assumed office.
As we approach this question, certain postulates project themselves to the fore. It is
Forthwith, on October 7, 1964 the movants aforesaid gave notice of their intention to take axiomatic that an election contest, involving as it does not only the adjudication and
the matter on appeal to the Court of Appeals. This was met with the protestant's motion settlement of the private interests of the rival candidates but also the paramount need of
to strike out their notice of appeal, grounded on the trial court's finding of movants' want dispelling once and for all the uncertainty that beclouds the real choice of the electorate
of personality to appear in the case, and consequently to appeal the decision a quo. with respect to who shall discharge the prerogatives of the offices within their gift, is a
proceeding imbued with public interest which raises it onto a plane over and above
In the meantime, Demetrio R. Loresca made common cause with De Mesa's widow and ordinary civil actions. For this reason, broad perspectives of public policy impose upon
the local Liberal Party Chapter, and moved for leave to be added to and/or substituted as courts the imperative duty to ascertain by all means within their command who is the real
party-protestee, claiming a legal and continuing interest in the outcome of the election candidate elected in as expeditious a manner as possible, without being fettered by
protest as successor to De Mesa. technicalities and procedural barriers to the end that the will of the people may not be
On November 10, 1964 the trial court dictated twin order (1) granting the protestant's frustrated (Ibasco vs. Ilao, et al., G.R. L-17512, December 29, 1960; Reforma vs. De Luna,
motion to strike out the notice of appeal heretofore adverted to; and (2) denying G.R. L-13242, July 31, 1958). So inextricably intertwined are the interests of the
Loresca's motion to be substituted a party-protestee. contestants and those of the public that there can be no gainsaying the logic of the
proposition that even the voluntary cessation in office of the protestee not only does
This development sent the herein petitioners to the Court of Appeals on a petition not ipso facto divest him of the character of an adversary in the contest inasmuch as he
for certiorari and mandamus, with preliminary injunction (CA 35019-R), to nullify for lack retains a party interest to keep his political opponent out of the office and maintain
of jurisdiction the proceedings taken by the trial court in the election case aforesaid therein his successor, but also does not in any manner impair or detract from the
without allowing the intervention and/or the inclusion of a legal representative of the jurisdiction of the court to pursue the proceeding to its final conclusion (De Los Angeles
deceased protestee; or, in the alternative, to compel the trial court to give due course to
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vs. Rodriguez, 46 Phil. 595, 597; Salcedo vs. Hernandez, 62 Phil. 584, 587; Galves vs. unerringly tend to the contrary. All the very least, nothing extant in the Revised Election
Maramba, G.R. L-13206). Code either expressly or by implication renders inappropriate the application of said
principle of substitution in case of death to proceedings thereunder. On the contrary,
Upon the same principle, the death of the protestee De Mesa did not abate the because of its clear failure to meet the contingency in question, the need to supplement
proceedings in the election protest filed against him, and it may be stated as a rule that an the deficiency becomes imperative. Then the exertion of judicial power to hear and
election contest survives and must be prosecuted to final judgment despite the death of determine a cause implicitly presupposes in the trial court, amongst other essentials,
the protestee. jurisdiction over the persons of the parties. That jurisdiction was inevitably impaired upon
With the death of De Mesa, however, a contingency not expressly provided for by the the death of the protestee pending the proceedings below such that unless and until a
Revised Election Code was ushered in. Nevertheless, the, hiatus in the special law posed legal representative is for him duly named and within the jurisdiction of the trial court, no
no impediment to the course of the proceedings because, precisely by express mandate of adjudication in the cause could have been accorded any validity or binding effect upon
Rule 134 of the Rules of Court, said rules, though not generally applicable to election any party, in representation of the deceased, without trenching upon the fundamental
cases, may however be applied "by analogy or in a suppletory character and whenever right to a day in court which is the very essence of the constitutionally enshrined
practicable and convenient." For the eventuality here involved, the Rules specifically plot guarantee of due process. As cogently synthesized in Cupples vs. Castro, 137 P. 2d., 755 —
the course of action to be taken, in the following language: Where contestant was declared elected and contestee appealed after which contestant
SEC. 17. Death of party.—After a party dies and the claim is not thereby extinguished, the died, rights of parties could not be determined in absence of contestant and his legal
court shall order, upon proper notice, the legal representative of the deceased to appear representative and submission would be set aside and cause taken from calendar to be
and to be substituted for the deceased, within a period of thirty (30) days, or within such heard only after representative for contestant should have been substituted. (Francisco,
time as may be granted. If the legal representative fails to appear within said time, the The Revised Election Code, 1957 ed., p. 583).
court may order the opposing party to procure the appointment of a legal representative If this be the case with the contestant, a fortiori no less can be said of the contestee
of the deceased within a time to be specified by the court, and the representative shall whose rights as well as those of his successor by operation of law would be at hazard in an
immediately appear for and on behalf of the interest of the deceased. . . . (Rule 3.) ex parte proceeding. Further still, the fundamental purpose of the Revised Election Code,
That the applicability of the foregoing precept to the election contest below was initially it has been recognized, is to protect the integrity of elections and suppress all evils that
conceded is borne out by the proceedings on record. The trial court, it will be recalled in may vitiate their purity and defeat the popular will. Judicial experience teaches that more
its order of May 6, 1964, required the widow and children of the deceased protestee to often than not frauds and irregularities committed during the voting come to light only
appear and be substituted for and on his behalf and to protect his interest in the case. But when the ballot boxes are opened and their contents examined. At no time then in the
when they failed to comply — mainly because of the shock and agony that followed in the course of an election contest is the need for vigilance more to be insisted upon than
wake of the violent death of the protestee — the trial court took no further steps in the during that critical stage when the ballot boxes are opened and the ballots themselves are
premises and, instead, at the instance of the protestant, declared said widow and children revised. To deny a party to the contest the representation that the law allows him at this
non-suited, proceeded with the case ex parte, and effectively blocked all attempts at juncture is virtually to take away one of the most effective measures designed for the
intervention and/or substitution in behalf of the deceased protestee. In these moves, the approximation of the primordial objective election laws are intended to achieve.
trial court did not only merit the unqualified sanction of the Court of Appeals but the In the light of the foregoing, it is our considered view that Section 17, Rule 3 of the Rules
latter, taking an even more radical of the matter, actually held that the rule relied upon of Court applies to election contests to the same extent and with the same force and
has no application to election cases. effect as it does in ordinary civil actions. And we declare that unless and until the
We cannot give our imprimatur to the foregoing view. All reasonable intendments procedure therein detailed is strictly adhered to, proceedings taken by a court in the
deducible from the law and the essential nature of the case involved, to our mind, absence of a duly appointed legal representative of the deceased protestee must be
stricken down as null and void. Considering that, in the case at bar, the trial court failed to
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order the protestant to procure the appointment of a legal representative of the deceased by the Rules to be substituted for the deceased protestee. Said commissioner was not
protestee after the latter's widow and children had failed to comply with the court order supposed to represent the protestee as a party litigant. His appointment as such was
requiring their appearance to be substituted in lieu of their predecessor, but instead — in made exclusively upon the initiative of the trial court and is authorized by the law. Section
derogation of the precepts of the Rule in question and in the total absence of a legal 175, Revised Election Code, merely as a time-saving device for the convenience of the
representative of the deceased protestee — proceeded ex parte with the election case, court and the parties in the purely mechanical operation of opening the ballots and
said court not only acted with grave abuse of discretion but actually committed a clear tabulating the count and in the interest of a speedy and expeditious revision and recount
extra-limitation of its lawful jurisdiction which, perforce, tainted all its proceedings with of the contested ballots (Hontiveros vs. Altavas, 24 Phil. 632, 649-650; Raymundo vs.
the indelible stigma of nullity (Barrameda, et al. vs. Barbara, 90 Phil. 718, 722, 723; Gonzales, 80 Phil. 719, 721). For all legal intents and purposes, while said commissioner's
Ferreria vs. Ibarra Vda. de Gonzales, et al., 55 O.G. No. 8, 1358, 136263; Sarmiento, etc., et appointment may be proposed by the contestants themselves, he is nevertheless
al. vs. Ortiz, et al., G.R. L-18583, January 31, 1964; Caisip vs. Cabangon, G.R. L-14684- exclusively an officer or an agent of the court under its direct control and supervision.
14686, August 26, 1960).
Equally unacceptable is the proposition that, because time is of the essence in an election
It is no argument against this conclusion to contend that the requirement for the contest, recourse to the appointment of a legal representative of a deceased protestee
procurement of a legal representative of a deceased litigant is couched in the permissive which can only protract and delay the progress of the case is but a finical matter of
term "may" instead of the mandatory word "shall." While the ordinary acceptations of procedure which can justifiably be dispensed with. The validity of the injunction for the
these terms may indeed be resorted to as guides in the ascertainment of the mandatory prompt disposal of election controversies as repeatedly postulated in a consistent array of
or directory character of statutory provisions, they are in no wise absolute and inflexible jurisprudence is not open to debate. The terms of office of elective officials are relatively
criteria in the vast areas of law and equity. Depending upon a consideration of the entire brief. To dissipate within the shortest time possible any aura of doubt upon the true result
provision, its nature, its object and the consequences that would follow from construing it of elections is a much sought-after desideratum. But, salutary though the precept may be,
one way or the other, the convertibility of said terms either as mandatory or permissive is it is no justification for cutting procedural corners or taking legal short cuts not warranted
a standard recourse in statutory construction. Thus, Black is authority for the rule that in a system of procedure where the rule of law is still held paramount over and above all
"Where the statute provides for the doing of some act which is required by justice or considerations of mere convenience and expediency. We would be the last to advocate a
public duty, or where it invests a public body, municipality or public officer with power departure from the policy of early settlement of electoral disputes, but we are not
and authority to take some action which concerns the public interest or rights of prepared to lend our approval to a course of action which would tend to achieve one
individuals, the permissive language will be construed as mandatory and the execution of object of desire at the expense of the orderly administration of justice and with the
the power may be insisted upon as a duty" (Black, Interpretation of Laws, pp. 540-543). sacrifice of the fundamental right of litigants to due process of law. Otherwise, the speedy
The matter here involved not only concerns public interest but also goes into the trial required by the law would be converted into a denial of justice (Querubin vs. Court of
jurisdiction of the trial court and is of the essence of the proceedings taken thereon. On Appeals, 82 Phil. 226, 230). In law — as in any other sphere of human relations — the end
this point, there is authority to the effect that in statutes relating to procedure, as is the very seldom, if at all, justifies the means. And, in the case at bar, the admittedly
one now under consideration, every act which is jurisdictional, or of the essence of the imperative demand for a speedy disposition of the controversy cannot deter our hand
proceedings, or is prescribed for the protection or benefit of the party affected, is from striking down illegality in the proceedings therein and remanding the case for new
mandatory (Gonzaga, Statutes and their Construction, p. 98, citing: Estate of Naval, G.R. trial, despite the concomitant delay that may be occasioned thereby, since that is the only
No. L-6736, May 4, 1954). The present case is well within the purview of this doctrine. course open if the ends of justice are to be subserved (Salcedo vs. Hernandez, 62 Phil.
584, 587).
Nor may the motu proprio appointment by the trial court of Ramon Antilon Jr. as
commissioner for the deceased protestee in the revision proceedings be decreed a Consequent to the conclusion we have just reached, we confront the issue of who is the
substantial compliance with the legal requirement. As aptly observed in the dissent to the legal representative of the deceased protestee entitled to be substituted in his stead.
decision under review, said commissioner was not the legal representative contemplated
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As the record of the case reveals, three different aspirants vied for that legal Liberal Party Chapter any claim to substitution. Not being duly incorporated as a juridical
representation: Demetrio R. Loresca, the vice-mayor who succeeded to the position of person, it can have no personality to sue or be sued as such. And while it conceivably may
mayor upon the protestee's demise; Magdalena Sibulo Vda. de De Mesa, the protestee's derive some indirect benefit consequent to the resolution of the contest in favor of the
widow; and the local chapter of the Liberal Party at Muntinlupa, Rizal, to which the deceased protestee, neither the chapter itself nor the officers thereof would become
deceased protestee belonged, as represented by its officers who are co-petitioners entitled thereby to any right to the contested office in case of a favorable judgment, nor,
herein. An examination of the countervailing interests of these parties seems in order. for that matter, do they stand to sustain any direct prejudice in case of an adverse one. No
basis therefore exists upon which to predicate their claim to substitution.
By virtue of Section 7 of the Local Autonomy Act, Republic Act 2264, the vice-mayor
stands next in line of succession to the mayor in case of a permanent vacancy in the The foregoing views render academic the alternative issue raised by the petitioners
latter's position. Upon the death of the protestee mayor in the case at bar, Loresca as regarding the propriety of their appeal from the trial court's decision in the main case.
then incumbent vice-mayor succeeded by operation of law to the vacated office and, as a
matter of right, is entitled to occupy the same for the unexpired term thereof or until the ACCORDINGLY, the judgment under review is reversed and in lieu thereof, another is
protest against his predecessor is decided adversely against the latter. The outcome of rendered —
that contest thus bears directly upon his right to his present position and, amongst all, he (1) Declaring null and void the judgment of the Court of First Instance of Rizal in election
is the person most keenly concerned and interested in the fair and regular conduct case 7924 thereof, dated August 10, 1964, which proclaimed the protestant Maximino A.
thereof in order that the true will of the electorate will be upheld. His status as a real Argana the duly elected mayor of Muntinlupa, Rizal in the 1963 elections, for having been
party in interest in the continuation of the proceedings — a fact conceded by the decision rendered without jurisdiction over the person of the legal representative of the deceased
under review itself — cannot thus be disputed. protestee Francisco de Mesa and all other proceedings taken by said court in said election
It is not correct to subject Loresca, as the Court of Appeals did, respecting his interest in case subsequent to the death of the said protestee;
the controversy to the operation of the equitable principle of laches. The initiative to (2) Ordering the protestant Maximino A. Argana, without delay, to vacate the office of the
cause his substitution in lieu of the deceased protestee was not Loresca's. It was the trial mayor of Muntinlupa, Rizal and to relinquish the same in favor of Demetrio R. Loresca;
court's as well as the protestant's duty, upon being apprised of the protestee's death, to and
cause the appointment of his legal representative according to the procedure delineated
in the Rules. Failing in this duty, it never became the obligation of Loresca to take it upon (3) Ordering the Court of First Instance of Rizal to forthwith appoint the petitioner
himself to be appointed as such legal representative, as in fact, he was not even duly and Demetrio R. Loresca as the legal representative of the deceased protestee Francisco de
seasonably notified, much less ordered, to appear and be so substituted. In this posture, Mesa and allow his appearance as such in substitution of the said deceased for purposes
and particularly because, as above held, the trial court did not even acquire jurisdiction of said election case 7924 of said court, to conduct a new trial in said election case, and
over him, no room exists for the operation of the rule on laches against him. His thereafter to render judgment therein as the evidence may warrant.
intervention should not have been denied.
No pronouncement as to costs.
The same cannot, however, be said of the protestee's widow or of the local Liberal Party
chapter of Muntinlupa. The protestee's claim to the contested office is not in any sense a
right transmissible to this widow or heirs. Said widow's only remaining interest in the
outcome of the case is limited to no more than the possible award of costs against the
deceased protestee. Besides not being such an interest as would justify her substitution
for her deceased husband as an indispensable legal representative, the right to such an
award if eventually made has already been waived by the protestant Argana. This
effectively withdraws the widow from the picture altogether. Much less has the local
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G.R. No. L-4712 July 11, 1952 It is first contended by the appellant that the above provision is mandatory, not only
because it employs the word "shall", which in its ordinary signification is mandatory, not
RAMON DIOKNO, plaintiff-appellant, permissive, but also because the provision is applicable to institutions of credit under the
vs. control of the Government, and because otherwise the phrases "subject to availability of
REHABILITATION FINANCE CORPORATION, defendant-appellee. loanable funds" and "any provisions of this charter, . . . and regulations to the contrary
Sixto de la Costa for appellee. notwithstanding" would be superfluous.

LABRADOR, J.: It is true that its ordinary signification the word "shall" is imperative.

Plaintiff is the holder of a backpay certificate of indebtedness issued by the Treasurer of In common or ordinary parlance, and in its ordinary signification, the term "shall" is a
the Philippines under the provisions of Republic Act No. 304 of a face value of P75,857.14 word of command, and one which has always or which must be given compulsory
dated August 30, 1948. On or about November 10, 1050, when the action was brought, he meaning; as denoting obligation. It has a preemptory meaning, and it is generally
had an outstanding loan with the Rehabilitation Finance Corporation, contracted imperative or mandatory. It has the invariable significance of operating to impose a duty
therewith on January 27, 1950, in the total sum of P50,000, covered by a mortgage on his which may be enforced, particularly if public policy is in favor of this meaning or when
property situated at 44 Alhambra, Ermita, Manila, with interest at 4 per cent per annum, addressed to public officials, or where a public interest is involved, or where the public or
of which P47,355.28 was still unpaid. In this action he seeks to compel the defendant persons have rights which ought to be exercised or enforced, unless a contrary intent
corporation to accept payment of the balance of his indebted with his backpay certificate. appears. People vs. O'Rourke, 13 P. 2d. 989, 992, 124 Cal. App. 752. (39 Words and
The defendant resists the suit on the ground that plaintiffs' demand is not only not Phrases, Permanent Ed., p. 90.)
authorized by section 2 of Republic Act No. 304 but contrary to the provisions thereof, The presumption is that the word "shall" in a statute is used is an imperative, and not in a
and furthermore because plaintiff's loan was obtain on January 27, 1950, much after the directory, sense. If a different interpretation is sought, it must rest upon something in the
passage of Republic Act No. 304, and because the law permits only "acceptance or character of the legislation or in the context which will justify a different
discount of backpay certificates," not the repayment of loans. The court a quo held that meaning. Haythorn vs. Van Keuren & Son, 74 A. 502, 504, 79 N. J. L. 101; Board of Finance
section 2 of Republic Act No. 304 is permissive merely, and that even if where mandatory, of School City of Aurora vs. People's Nat. Bank of Lawrenceburg, 89 N. E. 904, 905 44 Ind.
plaintiff's case can not fall thereunder because he is not acquiring property for a home or App. 578. (39 Words and Phrases, Permanent Ed., p. 93.)
construing a residential house, but compelling the acceptance of his backpay certificate to
pay a debt he contracted after the enactment of Republic Act No. 304. It, therefore, However, the rule is not absolute; it may be construed as "many", when so required by
dismissed the complaint with costs. the context or by the intention of the statute.

The appeal involves the interpretation of section 2 of Republic Act No. 302, which In the ordinary signification, "shall" is imperative, and not permissive, though it may have
provides: the latter meaning when required by the context. Town of Milton vs. Cook, 138 N.E. 589,
590, 244 Mass. 93. (39 Words and Phrases, Permanent Ed., p. 89.)
. . . And provided, also, That investment funds or banks or other financial institutions
owned or controlled by the Government shall, subject to the availability of loanable funds, "Must" or "shall" in a statute is not always imperative, but may be consistent with an
and any provision of the their charters, articles of incorporation's, by-laws, or rules and exercise of discretion. In re O'Hara, 82 N.Y.S. 293, 296, 40 Misc. 355, citing In re Thurber's
regulations to the contrary notwithstanding, accept or discount at not more than two per Estate, 162 N.Y. 244, 252, 56 N.E. 638, 639. (Ibid. p. 92.)
centum per annum for ten years such certificate for the following purposes only: (1) the
acquisition of real property for use as the applicant's home, or (2) the building or The word "shall" is generally regarded as imperative, but in some context it is given a
construction of the residential house of the payee of said certificate: . . . permissive meaning, the intended meaning being determined by what is intended by the
statute. National Transit Corporation Co. vs. Boardman, 197 A. 239, 241, 328, Pa. 450.
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The word "shall" is to be construed as merely permissive, where no public benefit or condition that there are "available loanable funds." In other words, acceptance or
private right requires it to be given an imperative meaning Sheldon vs. Sheldon, 134 A. discount is to be permitted only if there are loanable funds.
904, 905, 100 N.J. Ex. 24.
Let us now consider the meaning of the condition imposed for accepting or discounting
Presumption is that word "shall" in ordinance, is mandatory; but, where it is necessary to certificates, the "availability of loanable funds." On this issue the appellant contends that
give effect to legislative intent, the word will be construed as "may." City of Colorado the mere fact that P50,000 was loaned to him and that the Rehabilitation Finance
Springs vs. Street, 254 p. 440, 441, 81 Colo. 181. Corporation has been granting loans up to the time plaintiff offered to pay the loan with
his certificate — these prove that there are "available loanable funds". As the court a
The word "shall" does not necessarily indicate a mandatory behest. Grimsrud vs. quo did not pass on such availability, he also contends that this is a question of fact to be
Johnson, 202 N. W. 72, 73, 162 Minn. 98. determined by the courts. The defendant denies the existence of "available loanable
Words like "may," "must," "shall" etc., are constantly used in statutes without intending funds." The gist of plaintiffs' contention is that any and all funds of the Rehabilitation
that they shall be taken literally, and in their construction the object evidently designed to Finance Corporation are subject to the provision of the discount or acceptance of the
be reached limits and controls the literal import of the terms and phrases employed. certificates; that of defendant-appellee is that only funds made available for the purpose
Fields vs. United States, 27 App. D. C. 433, 440. (39 Words and Phrases, Permanent Ed., of discounting backpay certificates may be used for such purpose and that at the time the
89, 92). action was filed there was no such funds.

In this jurisdiction the tendency has been to interpret the word "shall" as the context or a The Rehabilitation Finance Corporation was created by Republic Act No. 85, which was
reasonable construction of the statute in which it is used demands or requires. Thus the approved on October 29, 1946. The corporation was created "to provide credit facilities
provision of section 11 of Rule 4 of the Rules requiring a municipal judge or a justice of the for the rehabilitation and development of agriculture, commerce, and industry, the
peace to render judgment of the conclusion of the trial has been held in the directory. reconstruction of property damaged by war, and the broadening and diversification of the
(Alejandro vs. Judge of First Instance1 40 Off. Gaz., 9th Supp., 261). In like manner section national economy" (section 1), and to achieve the above aims it was granted the following
178 of the Election Law, in so far a it requires that appeals shall be decided in three powers:
months, has been to the directory for the Court of Appeals. (Querubin vs. The Court of SEC. 2. Corporate powers. — The Rehabilitation Finance Corporation shall have the power:
Appeals,2 46 Off. Gaz., 155).
(a) To grant loans for home building and for the rehabilitation, establishment or
In the provision subject controversy, it is to be noted that the verb-phrase "shall accept or development of any agricultural, commercial or industrial enterprise, including public
discount" has two modifiers, namely, "subject to availability of loanable funds" and "at utilities;
not more that two per centum per annum for ten years." As to the second modifier, the
interest to be charged, there seems to be no question that the verb phrase is mandatory, (b) To grant loans to provincial, city and municipal governments for the rehabilitation,
because not only does the law use "at not more" but the legislative purpose and intent, to construction or reconstruction of public markets, waterworks, toll bridges,
conserve the value of the backpay certificate for the benefit of the holders, for whose slaughterhouses, and other self-liquidating or income-producing services;
benefit the same have been issued, can be carried out by fixing a maximum limit for
discounts. But as to when the discounting or acceptance shall be made, the context and (c) To grant loans to agencies and corporations owned or controlled by the Government of
the sense demand a contrary interpretation. The phrase "subject" means "being under the the Republic of the Philippines for the production and distribution of electrical power, for
contingency of" (Webster's Int. Dict.) a condition. If the acceptance or discount of the the purchase and subdivision of rural and urban estates, for housing projects, for irrigation
certificates to be "subject" to the condition of the availability of a loanable funds, it is and waterworks systems, and for other essential industrial and agricultural enterprises;
evident that the Legislature intended that the acceptance shall be allowed on the (d) To grant loans to cooperative associations to facilitate production, the marketing of
crops, and the acquisition of essential commodities;
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(e) To underwrite, purchase, own, sell, mortgage or otherwise dispose of stocks, bonds, Funds made available:
debentures, securities and other evidences of indebtedness issued for or in connection
with any project or enterprise referred to in the proceeding paragraphs; Initial cash capital ................................................................ P50,000,000,00
(f) To issue bonds, debentures, securities, collaterals, and other obligations with the
approval of the President, but in no case to exceed at any one time an aggregate amount Cash Transferred from Financial Rehabilitation Funds .... 2,423,079.94
equivalent to one hundred per centum of its subscribed capital and surplus. . . .
Cash received from Surplus Property Commission ....... 26,350,000.00
If the Rehabilitation Finance Corporation is to carry out the aims and purposes for which it
was created, It must evolve a definite plan of the industries or activities which it should be Cash received from Phil. Shipping Adm. ........................... 3,700,000.00
rehabilitate, establish, or develop, and apportion its available funds and resources among
these, consistent with the policies outlined in its charter. Cash payment of capital .................................................. 82,473,079.74

As of May 31, 1948, immediately prior to the passage of the Backpay Law, it had granted
Proceeds of bond issues .................................................. 58,909,148.18
the following classes of loans:

Agricultural loans ........................................................ P23,610,350.74 Advances from the Central Bank ....................................... 10,000,000.00

There was also collectible from the loans the total amount of P28,659,442.12, so that the
Industrial loans ............................................................ 22,717,565.87
total cash available to the corporation from January 2, 1947, to November 30, 1949, was
P180,041,670.04. But the Total amount of loans already approved as of the last date was
Real Estate Loans ........................................................ 34,601,258.29
P203,667,403.78 and the total of approved loans pending release was P25,342,020.78,
and the only cash balance available in November, 1949, to meet these approved loans was
Loans for purchase, Subdivision and Resale of Landed
P1,716,286.71.
Estates ......................................................... 7,271,258.78
It may readily be seen from the above data that were we to follow appellant's theory and
Loans to Provinces, Cities, and Municipalities for Self- contention that the law is mandatory, the loan he had applied for, as well as that of any
liquidating Projects .............................................. 1,889,763.00 holder of a backpay certificate, would have to be paid out of this available cash, pursuant
to the alleged mandate of section 2 of the Backpay Law. The compulsory acceptance and
Total Loans .................................................. P90,090,77.68 discount of certificates will bring about, as a direct and necessary consequence, the
(Exhibit 2) suspension of all, if not of most, of the activities of the Rehabilitation Finance Corporation;
and no agricultural or industrial loans, or loans to financial institutions and local
As of February 2, 1951, the corporation had accepted in payment of loans granted before governments for their markets, waterworks, etc., would be granted until all the backpay
June 18, 1948, the total amount of P8,225,229.96, as required by section 2 of the Backpay certificates (amounting to some hundred millions of pesos) shall heave been accepted or
Law. (See Exhibit 11, p.4.). discounted. And as the defendant-appellant forcefully argues, even funds obtained by the
Rehabilitation Finance Corporation by the issue of the bonds, at rates of interest of more
The third anniversary report of the Rehabilitation Finance Corporation dated January 2,
than 2 per cent, the rate fixed for the discount of the backpay certificates, will have to be
1950 (Exhibit 1,), shows that the funds originally available to the corporation came from
loaned to holders of backpay certificates at a loss, to the prejudice of the corporation.
the following sources:
There would be loans for holders of backpay certificates, but none for rehabilitation or
reconstruction, or development of industries, or of the national economy; there would be
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funds for employees' loans, but none for the improvements of public services, etc., as all certificates, from time to time and in its sound discretion, as circumstances and its
Rehabilitation Finance Corporation funds will be necessary to meet the demands of resources may warrant.
holders of backpay certificates. And if it be remembered that the provision is intended for
all financial institutions controlled by the Government, the consequences would be felt by Having come to the conclusion that section 2 of the Backpay Law is directly merely, we
all industries and activities, and the whole scheme of national financial organization and now address ourselves to the propriety of the action, which the plaintiff and appellant
development disrupted. It seems evident that the legislature never could have intended labels specific performance. As the action is not based on any contractual relation
such absurd consequences, even with all the sympathy that it is showing for holders of between the plaintiff and appellant and the defendant and appellee, it may be one for
backpay certificates. specific performance; it is in effect predicated on a supposed legal duty imposed by law
and is properly the designated as a special civil action of mandamus because the appellant
But while we agree with the appellee that it could not have been the intention of seeks to compel the appellee to accept his backpay certificate in payment of his
Congress to disrupt the whole scheme of rehabilitation, reconstruction, and development outstanding obligation. We are not impressed by the defense technical in a sense, that the
envisioned in the Rehabilitation Act, by its passage of section 2 of the Backpay Law, Rehabilitation Finance Corporation is not expressly authorized to accept certificates in
neither we are prepared to follow appellee's insinuation that the section is impracticable payment of outstanding loans. There is no provision expressly authorizing this procedure
or impossible of execution by the Rehabilitation Finance Corporation in the situation in or system; but neither is there one prohibiting it. The legislature has once ordered it; the
which its funds and resources were at the time of the trial. In our opinion, what the Rehabilitation Finance Corporation has once authorized it. We believe the legislature
Legislature intended by the provision in dispute is that the Rehabilitation Finance could not have intended to discriminate against those who have already built their
Corporation, through its Board of Directors, should from time to time set aside some houses, who have contracted obligations in so doing. We prefer to predicate court ruling
reasonable amount for the discount of backpay certificates, when this can be done that this special action does not lie on the ground that the duty imposed by the Backpay
without unduly taxing its resources, or unduly prejudicing the plan of rehabilitation and Law upon the appellee as to the acceptance or discount of backpay certificates is neither
development that it has mapped out, or that which the corresponding authority has laid clear nor ministerial, but discretionary merely and that mandamus does not issue to
down as a policy. This legislative intention can be inferred from the fact that Congress control the exercise of discretion of public officer. (Viuda e hijos de Crispulo
itself expressly ordered that all financial institutions accept or discount backpay Zamora vs. Wright and Segado, 53 Phil., 613, 621; Blanco vs. Board of Medical Examiners,
certificates in payment of those loans, evidently laying down an example to be followed 46 Phil., 190 192, citing Lamb vs. Phipps, 22 Phil., 456; Gonzales vs. Board of Pharmacy, 20
by financial institutions under its control. The loans granted under section 2 of the law by Phil., 367, etc.) It is, however, argued on behalf of the appellant that inasmuch as the
the Rehabilitation Finance Corporation amounted to P8,225,229.96. It is shown or even Board of Directors of the Rehabilitation Finance Corporation has seen fit to approve a
presented that the payment of this considerable amount has impaired or disrupted the resolution accepting backpay certificates amounting to P151,000 (Exhibit H), law and
activities of the Rehabilitation Finance Corporation. It is not claimed, either, that at the equity demand that the same privilege should be accorded him. The trial court held that
time of the filing of appellant's action the Rehabilitation Finance Corporation was in no the above resolution was illegal and that its unauthorized enactment (which he called a
position to set aside a modest sum, in a manner similar to the creation of a sinking fund, "wrong") does not justify its repetition for the benefit of appellant. As we have indicated
for the discount of backpay certificates to help the Government comply with its financial above, we believe that its approval (not any supposed discrimination on behalf of some
commitments. We are convinced that the Rehabilitation Finance Corporation may, special holders) can be defended under the law, but that the passage of a similar
without impairment of its activities, set aside from time to time, say, half a million pesos resolution can not be enjoined by an action of mandamus.
or a considerable part thereof, for the payment of backpay certificates. But these
circumstances notwithstanding, we are of the opinion that the law in question (section 2 We must admit, however, that appellant's case is not entirely without any merit or
of the Backpay Law), in so far as the discount and acceptance of backpay certificates are justification; similar situations have already been favorably acted upon by the Congress,
concerned, should be interpreted to be directory merely, not mandatory, as claimed by when it ordered that certificates be accepted in payment of outstanding obligations, and
plaintiff-appellant, the same to be construed as a directive for the Rehabilitation Finance by the Rehabilitation Finance Corporation in its above-mentioned resolution. But we feel
Corporation to invest a reasonable portion of its funds for the discount of backpay we are powerless to enforce his claim, as the acceptance and discount to backpay
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certificates has been placed within the sound discretion of the rehabilitation Finance
Corporation, and subject to the availability of loanable funds, and said discretion may not
be reviewed or controlled by us. It is clear that this remedy must be available in other
quarters, not in the courts of justice.

For all the foregoing considerations, we are constrained to dismiss the appeal, with coasts
against the appellant.
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