Cases | World Trade Organization | General Agreement On Tariffs And Trade

B. CONSTRUCTION OF THE CONSTITUTION AND THE BILL OF RIGHTS Cases [G.R. No. 122156.

February 3, 1997]

MANILA PRINCE HOTEL, petitioner, vs. GOVERNMENT SERVICE INSURANCE SYSTEM, MANILA HOTEL CORPORATION, COMMITTEE ON PRIVATIZATION and OFFICE OF THE GOVERNMENT CORPORATE COUNSEL, respondents.

DECISION

BELLOSILLO, J.:

The Filipino First Policy enshrined in the 1987 Constitution, i.e., in the grant of rights, privileges, and concessions covering the national economy and patrimony, the State shall give preference to qualified Filipinos,[1] is invoked by petitioner in its bid to acquire 51% of the shares of the Manila Hotel Corporation (MHC) which owns the historic Manila Hotel. Opposing, respondents maintain that the provision is not self-executing but requires an implementing legislation for its enforcement. Corollarily, they ask whether the 51% shares form part of the national economy and patrimony covered by the protective mantle of the Constitution.

The controversy arose when respondent Government Service Insurance System (GSIS), pursuant to the privatization program of the Philippine Government under Proclamation No. 50 dated 8 December 1986, decided to sell through public bidding 30% to 51% of the issued and outstanding shares of respondent MHC. The winning bidder, or the eventual “strategic partner,” is to provide management expertise and/or an international marketing/reservation system, and financial support to strengthen the profitability and performance of the Manila Hotel.[2] In a close bidding held on 18 September 1995 only two (2) bidders participated: petitioner Manila Prince Hotel Corporation, a Filipino corporation, which offered to buy 51% of the MHC or 15,300,000 shares at P41.58 per share, and Renong Berhad, a Malaysian firm, with ITT-Sheraton as its hotel operator, which bid for the same number of shares at P44.00 per share, or P2.42 more than the bid of petitioner.

Pertinent provisions of the bidding rules prepared by respondent GSIS state -

I. EXECUTION OF THE NECESSARY CONTRACTS WITH GSIS/MHC -

1. The Highest Bidder must comply with the conditions set forth below by October 23, 1995 (reset to November 3, 1995) or the Highest Bidder will lose the right to purchase the Block of Shares and GSIS will instead offer the Block of Shares to the other Qualified Bidders:

a. The Highest Bidder must negotiate and execute with the GSIS/MHC the Management Contract, International Marketing/Reservation System Contract or other type of contract specified by the Highest Bidder in its strategic plan for the Manila Hotel x x x x

b. The Highest Bidder must execute the Stock Purchase and Sale Agreement with GSIS x x x x

K. DECLARATION OF THE WINNING BIDDER/STRATEGIC PARTNER -

The Highest Bidder will be declared the Winning Bidder/Strategic Partner after the following conditions are met:

a. Execution of the necessary contracts with GSIS/MHC not later than October 23, 1995 (reset to November 3, 1995); and

b. Requisite approvals from the GSIS/MHC and COP (Committee on Privatization)/ OGCC (Office of the Government Corporate Counsel) are obtained.”*3+

Pending the declaration of Renong Berhard as the winning bidder/strategic partner and the execution of the necessary contracts,

petitioner in a letter to respondent GSIS dated 28 September 1995 matched the bid price of P44.00 per share tendered by Renong Berhad.[4] In a subsequent letter dated 10 October 1995 petitioner sent a manager’s check issued by Philtrust Bank for Thirty-three Million Pesos (P33,000,000.00) as Bid Security to match the bid of the Malaysian Group, Messrs. Renong Berhad x x x x[5] which respondent GSIS refused to accept.

On 17 October 1995, perhaps apprehensive that respondent GSIS has disregarded the tender of the matching bid and that the sale of 51% of the MHC may be hastened by respondent GSIS and consummated with Renong Berhad, petitioner came to this Court on prohibition and mandamus. On 18 October 1995 the Court issued a temporary restraining order enjoining respondents from perfecting and consummating the sale to the Malaysian firm.

On 10 September 1996 the instant case was accepted by the Court En Banc after it was referred to it by the First Division. The case was then set for oral arguments with former Chief Justice Enrique M. Fernando and Fr. Joaquin G. Bernas, S.J., as amici curiae.

In the main, petitioner invokes Sec. 10, second par., Art. XII, of the 1987 Constitution and submits that the Manila Hotel has been identified with the Filipino nation and has practically become a historical monument which reflects the vibrancy of Philippine heritage and culture. It is a proud legacy of an earlier generation of Filipinos

who believed in the nobility and sacredness of independence and its power and capacity to release the full potential of the Filipino people. To all intents and purposes, it has become a part of the national patrimony.[6] Petitioner also argues that since 51% of the shares of the MHC carries with it the ownership of the business of the hotel which is owned by respondent GSIS, a government-owned and controlled corporation, the hotel business of respondent GSIS being a part of the tourism industry is unquestionably a part of the national economy. Thus, any transaction involving 51% of the shares of stock of the MHC is clearly covered by the term national economy, to which Sec. 10, second par., Art. XII, 1987 Constitution, applies.[7]

It is also the thesis of petitioner that since Manila Hotel is part of the national patrimony and its business also unquestionably part of the national economy petitioner should be preferred after it has matched the bid offer of the Malaysian firm. For the bidding rules mandate that if for any reason, the Highest Bidder cannot be awarded the Block of Shares, GSIS may offer this to the other Qualified Bidders that have validly submitted bids provided that these Qualified Bidders are willing to match the highest bid in terms of price per share.[8]

Respondents except. They maintain that: First, Sec. 10, second par., Art. XII, of the 1987 Constitution is merely a statement of principle and policy since it is not a self-executing provision and requires implementing legislation(s) x x x x Thus, for the said provision to operate, there must be existing laws “to lay down conditions under which business may be done.”*9+

Second, granting that this provision is self-executing, Manila Hotel does not fall under the term national patrimony which only refers to lands of the public domain, waters, minerals, coal, petroleum and other mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna and all marine wealth in its territorial sea, and exclusive marine zone as cited in the first and second paragraphs of Sec. 2, Art. XII, 1987 Constitution. According to respondents, while petitioner speaks of the guests who have slept in the hotel and the events that have transpired therein which make the hotel historic, these alone do not make the hotel fall under the patrimony of the nation. What is more, the mandate of the Constitution is addressed to the State, not to respondent GSIS which possesses a personality of its own separate and distinct from the Philippines as a State.

Third, granting that the Manila Hotel forms part of the national patrimony, the constitutional provision invoked is still inapplicable since what is being sold is only 51% of the outstanding shares of the corporation, not the hotel building nor the land upon which the building stands. Certainly, 51% of the equity of the MHC cannot be considered part of the national patrimony. Moreover, if the disposition of the shares of the MHC is really contrary to the Constitution, petitioner should have questioned it right from the beginning and not after it had lost in the bidding.

Fourth, the reliance by petitioner on par. V., subpar. J. 1., of the bidding rules which provides that if for any reason, the Highest Bidder cannot be awarded the Block of Shares, GSIS may offer this to the other Qualified Bidders that have validly submitted bids provided that these Qualified Bidders are willing to match the highest bid in terms of price per share, is misplaced. Respondents postulate that the privilege of submitting a matching bid has not yet arisen since it only takes place if for any reason, the Highest Bidder cannot be awarded the Block of Shares. Thus the submission by petitioner of a matching bid is premature since Renong Berhad could still very well be awarded the block of shares and the condition giving rise to the exercise of the privilege to submit a matching bid had not yet taken place.

Finally, the prayer for prohibition grounded on grave abuse of discretion should fail since respondent GSIS did not exercise its discretion in a capricious, whimsical manner, and if ever it did abuse its discretion it was not so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law. Similarly, the petition for mandamus should fail as petitioner has no clear legal right to what it demands and respondents do not have an imperative duty to perform the act required of them by petitioner.

We now resolve. A constitution is a system of fundamental laws for the governance and administration of a nation. It is supreme, imperious, absolute and unalterable except by the authority from which it emanates. It has been defined as the fundamental and

paramount law of the nation.[10] It prescribes the permanent framework of a system of government, assigns to the different departments their respective powers and duties, and establishes certain fixed principles on which government is founded. The fundamental conception in other words is that it is a supreme law to which all other laws must conform and in accordance with which all private rights must be determined and all public authority administered.[11] Under the doctrine of constitutional supremacy, if a law or contract violates any norm of the constitution that law or contract whether promulgated by the legislative or by the executive branch or entered into by private persons for private purposes is null and void and without any force and effect. Thus, since the Constitution is the fundamental, paramount and supreme law of the nation, it is deemed written in every statute and contract.

Admittedly, some constitutions are merely declarations of policies and principles. Their provisions command the legislature to enact laws and carry out the purposes of the framers who merely establish an outline of government providing for the different departments of the governmental machinery and securing certain fundamental and inalienable rights of citizens.[12] A provision which lays down a general principle, such as those found in Art. II of the 1987 Constitution, is usually not self-executing. But a provision which is complete in itself and becomes operative without the aid of supplementary or enabling legislation, or that which supplies sufficient rule by means of which the right it grants may be enjoyed or protected, is self-executing. Thus a constitutional provision is selfexecuting if the nature and extent of the right conferred and the

liability imposed are fixed by the constitution itself, so that they can be determined by an examination and construction of its terms, and there is no language indicating that the subject is referred to the legislature for action.[13]

As against constitutions of the past, modern constitutions have been generally drafted upon a different principle and have often become in effect extensive codes of laws intended to operate directly upon the people in a manner similar to that of statutory enactments, and the function of constitutional conventions has evolved into one more like that of a legislative body. Hence, unless it is expressly provided that a legislative act is necessary to enforce a constitutional mandate, the presumption now is that all provisions of the constitution are selfexecuting. If the constitutional provisions are treated as requiring legislation instead of self-executing, the legislature would have the power to ignore and practically nullify the mandate of the fundamental law.[14] This can be cataclysmic. That is why the prevailing view is, as it has always been, that -

x x x x in case of doubt, the Constitution should be considered selfexecuting rather than non-self-executing x x x x Unless the contrary is clearly intended, the provisions of the Constitution should be considered self-executing, as a contrary rule would give the legislature discretion to determine when, or whether, they shall be effective. These provisions would be subordinated to the will of the lawmaking body, which could make them entirely meaningless by simply refusing to pass the needed implementing statute.[15]

Respondents argue that Sec. 10, second par., Art. XII, of the 1987 Constitution is clearly not self-executing, as they quote from discussions on the floor of the 1986 Constitutional Commission -

MR. RODRIGO. Madam President, I am asking this question as the Chairman of the Committee on Style. If the wording of “PREFERENCE” is given to QUALIFIED FILIPINOS,” can it be understood as a preference to qualified Filipinos vis-a-vis Filipinos who are not qualified. So, why do we not make it clear? To qualified Filipinos as against aliens?

THE PRESIDENT. What is the question of Commissioner Rodrigo? Is it to remove the word “QUALIFIED?”

MR. RODRIGO. No, no, but say definitely “TO QUALIFIED FILIPINOS” as against whom? As against aliens or over aliens ?

MR. NOLLEDO. Madam President, I think that is understood. We use the word “QUALIFIED” because the existing laws or prospective laws will always lay down conditions under which business may be done. For example, qualifications on capital, qualifications on the setting up of other financial structures, et cetera (underscoring supplied by respondents).

MR. RODRIGO. It is just a matter of style.

MR. NOLLEDO. Yes.[16]

Quite apparently, Sec. 10, second par., of Art XII is couched in such a way as not to make it appear that it is non-self-executing but simply for purposes of style. But, certainly, the legislature is not precluded from enacting further laws to enforce the constitutional provision so long as the contemplated statute squares with the Constitution. Minor details may be left to the legislature without impairing the selfexecuting nature of constitutional provisions.

In self-executing constitutional provisions, the legislature may still enact legislation to facilitate the exercise of powers directly granted by the constitution, further the operation of such a provision, prescribe a practice to be used for its enforcement, provide a convenient remedy for the protection of the rights secured or the determination thereof, or place reasonable safeguards around the exercise of the right. The mere fact that legislation may supplement and add to or prescribe a penalty for the violation of a self-executing constitutional provision does not render such a provision ineffective in the absence of such legislation. The omission from a constitution of any express provision for a remedy for enforcing a right or liability is not necessarily an indication that it was not intended to be self-executing. The rule is that a self-executing provision of the constitution does not necessarily exhaust legislative power on the subject, but any legislation must be in harmony with the constitution, further the exercise of constitutional right and make it more available.[17] Subsequent legislation however does not necessarily mean that the subject constitutional provision is not, by itself, fully enforceable.

Respondents also argue that the non-self-executing nature of Sec. 10, second par., of Art. XII is implied from the tenor of the first and third

paragraphs of the same section which undoubtedly are not selfexecuting.[18] The argument is flawed. If the first and third paragraphs are not self-executing because Congress is still to enact measures to encourage the formation and operation of enterprises fully owned by Filipinos, as in the first paragraph, and the State still needs legislation to regulate and exercise authority over foreign investments within its national jurisdiction, as in the third paragraph, then a fortiori, by the same logic, the second paragraph can only be self-executing as it does not by its language require any legislation in order to give preference to qualified Filipinos in the grant of rights, privileges and concessions covering the national economy and patrimony. A constitutional provision may be self-executing in one part and non-self-executing in another.[19]

Even the cases cited by respondents holding that certain constitutional provisions are merely statements of principles and policies, which are basically not self-executing and only placed in the Constitution as moral incentives to legislation, not as judicially enforceable rights - are simply not in point. Basco v. Philippine Amusements and Gaming Corporation[20] speaks of constitutional provisions on personal dignity,[21] the sanctity of family life,[22] the vital role of the youth in nation-building,[23] the promotion of social justice,[24] and the values of education.[25] Tolentino v. Secretary of Finance[26] refers to constitutional provisions on social justice and human rights[27] and on education.[28] Lastly, Kilosbayan, Inc. v. Morato[29] cites provisions on the promotion of general welfare,[30] the sanctity of family life,[31] the vital role of the youth in nationbuilding[32] and the promotion of total human liberation and

development.[33] A reading of these provisions indeed clearly shows that they are not judicially enforceable constitutional rights but merely guidelines for legislation. The very terms of the provisions manifest that they are only principles upon which legislations must be based. Res ipsa loquitur.

On the other hand, Sec. 10, second par., Art. XII of the 1987 Constitution is a mandatory, positive command which is complete in itself and which needs no further guidelines or implementing laws or rules for its enforcement. From its very words the provision does not require any legislation to put it in operation. It is per se judicially enforceable. When our Constitution mandates that [i]n the grant of rights, privileges, and concessions covering national economy and patrimony, the State shall give preference to qualified Filipinos, it means just that - qualified Filipinos shall be preferred. And when our Constitution declares that a right exists in certain specified circumstances an action may be maintained to enforce such right notwithstanding the absence of any legislation on the subject; consequently, if there is no statute especially enacted to enforce such constitutional right, such right enforces itself by its own inherent potency and puissance, and from which all legislations must take their bearings. Where there is a right there is a remedy. Ubi jus ibi remedium.

As regards our national patrimony, a member of the 1986 Constitutional Commission[34] explains -

The patrimony of the Nation that should be conserved and developed refers not only to our rich natural resources but also to the cultural heritage of our race. It also refers to our intelligence in arts, sciences and letters. Therefore, we should develop not only our lands, forests, mines and other natural resources but also the mental ability or faculty of our people.

We agree. In its plain and ordinary meaning, the term patrimony pertains to heritage.[35] When the Constitution speaks of national patrimony, it refers not only to the natural resources of the Philippines, as the Constitution could have very well used the term natural resources, but also to the cultural heritage of the Filipinos.

Manila Hotel has become a landmark - a living testimonial of Philippine heritage. While it was restrictively an American hotel when it first opened in 1912, it immediately evolved to be truly Filipino. Formerly a concourse for the elite, it has since then become the venue of various significant events which have shaped Philippine history. It was called the Cultural Center of the 1930’s. It was the site of the festivities during the inauguration of the Philippine Commonwealth. Dubbed as the Official Guest House of the Philippine Government it plays host to dignitaries and official visitors who are accorded the traditional Philippine hospitality.[36]

The history of the hotel has been chronicled in the book The Manila Hotel: The Heart and Memory of a City.[37] During World War II the hotel was converted by the Japanese Military Administration into a military headquarters. When the American forces returned to recapture Manila the hotel was selected by the Japanese together with Intramuros as the two (2) places for their final stand. Thereafter, in the 1950’s and 1960’s, the hotel became the center of political activities, playing host to almost every political convention. In 1970 the hotel reopened after a renovation and reaped numerous international recognitions, an acknowledgment of the Filipino talent and ingenuity. In 1986 the hotel was the site of a failed coup d’ etat where an aspirant for vice-president was “proclaimed” President of the Philippine Republic.

For more than eight (8) decades Manila Hotel has bore mute witness to the triumphs and failures, loves and frustrations of the Filipinos; its existence is impressed with public interest; its own historicity associated with our struggle for sovereignty, independence and nationhood. Verily, Manila Hotel has become part of our national economy and patrimony. For sure, 51% of the equity of the MHC comes within the purview of the constitutional shelter for it comprises the majority and controlling stock, so that anyone who acquires or owns the 51% will have actual control and management of the hotel. In this instance, 51% of the MHC cannot be disassociated from the hotel and the land on which the hotel edifice stands. Consequently, we cannot sustain respondents’ claim that the Filipino First Policy provision is not applicable since what is being sold is only

51% of the outstanding shares of the corporation, not the Hotel building nor the land upon which the building stands.[38]

The argument is pure sophistry. The term qualified Filipinos as used in our Constitution also includes corporations at least 60% of which is owned by Filipinos. This is very clear from the proceedings of the 1986 Constitutional Commission -

THE PRESIDENT. Commissioner Davide is recognized.

MR. DAVIDE. I would like to introduce an amendment to the Nolledo amendment. And the amendment would consist in substituting the words “QUALIFIED FILIPINOS” with the following: “CITIZENS OF THE PHILIPPINES OR CORPORATIONS OR ASSOCIATIONS WHOSE CAPITAL OR CONTROLLING STOCK IS WHOLLY OWNED BY SUCH CITIZENS.”

xxxx

MR. MONSOD. Madam President, apparently the proponent is agreeable, but we have to raise a question. Suppose it is a corporation that is 80-percent Filipino, do we not give it preference?

MR. DAVIDE. The Nolledo amendment would refer to an individual Filipino. What about a corporation wholly owned by Filipino citizens?

MR. MONSOD. At least 60 percent, Madam President.

MR. DAVIDE. Is that the intention?

MR. MONSOD. Yes, because, in fact, we would be limiting it if we say that the preference should only be 100-percent Filipino.

MR. DAVIDE. I want to get that meaning clear because “QUALIFIED FILIPINOS” may refer only to individuals and not to juridical personalities or entities.

MR. MONSOD. We agree, Madam President.[39]

xxxx

MR. RODRIGO. Before we vote, may I request that the amendment be read again.

MR. NOLLEDO. The amendment will read: “IN THE GRANT OF RIGHTS, PRIVILEGES AND CONCESSIONS COVERING THE NATIONAL ECONOMY AND PATRIMONY, THE STATE SHALL GIVE PREFERENCE TO QUALIFIED FILIPINOS.” And the word “Filipinos” here, as intended by the proponents, will include not only individual Filipinos but also Filipino-controlled entities or entities fully-controlled by Filipinos.[40]

The phrase preference to qualified Filipinos was explained thus -

MR. FOZ. Madam President, I would like to request Commissioner Nolledo to please restate his amendment so that I can ask a question.

MR. NOLLEDO. “IN THE GRANT OF RIGHTS, PRIVILEGES AND CONCESSIONS COVERING THE NATIONAL ECONOMY AND PATRIMONY, THE STATE SHALL GIVE PREFERENCE TO QUALIFIED FILIPINOS.”

MR. FOZ. In connection with that amendment, if a foreign enterprise is qualified and a Filipino enterprise is also qualified, will the Filipino enterprise still be given a preference?

MR. NOLLEDO. Obviously.

MR. FOZ. If the foreigner is more qualified in some aspects than the Filipino enterprise, will the Filipino still be preferred?

MR. NOLLEDO. The answer is “yes.”

MR. FOZ. Thank you.[41]

Expounding further on the Filipino First Policy provision Commissioner Nolledo continues –

MR. NOLLEDO. Yes, Madam President. Instead of “MUST,” it will be “SHALL - THE STATE SHALL GIVE PREFERENCE TO QUALIFIED FILIPINOS.” This embodies the so-called “Filipino First” policy. That means that Filipinos should be given preference in the grant of concessions, privileges and rights covering the national patrimony.[42]

The exchange of views in the sessions of the Constitutional Commission regarding the subject provision was still further clarified by Commissioner Nolledo[43] -

Paragraph 2 of Section 10 explicitly mandates the “Pro-Filipino” bias in all economic concerns. It is better known as the FILIPINO FIRST

Policy x x x x This provision was never found in previous Constitutions x x x x

The term “qualified Filipinos” simply means that preference shall be given to those citizens who can make a viable contribution to the common good, because of credible competence and efficiency. It certainly does NOT mandate the pampering and preferential treatment to Filipino citizens or organizations that are incompetent or inefficient, since such an indiscriminate preference would be counterproductive and inimical to the common good.

In the granting of economic rights, privileges, and concessions, when a choice has to be made between a “qualified foreigner” and a “qualified Filipino,” the latter shall be chosen over the former.”

Lastly, the word qualified is also determinable. Petitioner was so considered by respondent GSIS and selected as one of the qualified bidders. It was pre-qualified by respondent GSIS in accordance with its own guidelines so that the sole inference here is that petitioner has been found to be possessed of proven management expertise in the hotel industry, or it has significant equity ownership in another hotel company, or it has an overall management and marketing proficiency to successfully operate the Manila Hotel.[44]

The penchant to try to whittle away the mandate of the Constitution by arguing that the subject provision is not self-executory and requires implementing legislation is quite disturbing. The attempt to violate a clear constitutional provision - by the government itself - is only too distressing. To adopt such a line of reasoning is to renounce the duty to ensure faithfulness to the Constitution. For, even some of the provisions of the Constitution which evidently need implementing legislation have juridical life of their own and can be the source of a judicial remedy. We cannot simply afford the government a defense that arises out of the failure to enact further enabling, implementing or guiding legislation. In fine, the discourse of Fr. Joaquin G. Bernas, S.J., on constitutional government is apt -

The executive department has a constitutional duty to implement laws, including the Constitution, even before Congress acts - provided that there are discoverable legal standards for executive action. When the executive acts, it must be guided by its own understanding of the constitutional command and of applicable laws. The responsibility for reading and understanding the Constitution and the laws is not the sole prerogative of Congress. If it were, the executive would have to ask Congress, or perhaps the Court, for an interpretation every time the executive is confronted by a constitutional command. That is not how constitutional government operates.[45]

Respondents further argue that the constitutional provision is addressed to the State, not to respondent GSIS which by itself

possesses a separate and distinct personality. This argument again is at best specious. It is undisputed that the sale of 51% of the MHC could only be carried out with the prior approval of the State acting through respondent Committee on Privatization. As correctly pointed out by Fr. Joaquin G. Bernas, S.J., this fact alone makes the sale of the assets of respondents GSIS and MHC a “state action.” In constitutional jurisprudence, the acts of persons distinct from the government are considered “state action” covered by the Constitution (1) when the activity it engages in is a “public function;” (2) when the government is so significantly involved with the private actor as to make the government responsible for his action; and, (3) when the government has approved or authorized the action. It is evident that the act of respondent GSIS in selling 51% of its share in respondent MHC comes under the second and third categories of “state action.” Without doubt therefore the transaction, although entered into by respondent GSIS, is in fact a transaction of the State and therefore subject to the constitutional command.[46]

When the Constitution addresses the State it refers not only to the people but also to the government as elements of the State. After all, government is composed of three (3) divisions of power - legislative, executive and judicial. Accordingly, a constitutional mandate directed to the State is correspondingly directed to the three (3) branches of government. It is undeniable that in this case the subject constitutional injunction is addressed among others to the Executive Department and respondent GSIS, a government instrumentality deriving its authority from the State.

It should be stressed that while the Malaysian firm offered the higher bid it is not yet the winning bidder. The bidding rules expressly provide that the highest bidder shall only be declared the winning bidder after it has negotiated and executed the necessary contracts, and secured the requisite approvals. Since the Filipino First Policy provision of the Constitution bestows preference on qualified Filipinos the mere tending of the highest bid is not an assurance that the highest bidder will be declared the winning bidder. Resultantly, respondents are not bound to make the award yet, nor are they under obligation to enter into one with the highest bidder. For in choosing the awardee respondents are mandated to abide by the dictates of the 1987 Constitution the provisions of which are presumed to be known to all the bidders and other interested parties.

Adhering to the doctrine of constitutional supremacy, the subject constitutional provision is, as it should be, impliedly written in the bidding rules issued by respondent GSIS, lest the bidding rules be nullified for being violative of the Constitution. It is a basic principle in constitutional law that all laws and contracts must conform with the fundamental law of the land. Those which violate the Constitution lose their reason for being.

Paragraph V. J. 1 of the bidding rules provides that [i]f for any reason the Highest Bidder cannot be awarded the Block of Shares, GSIS may offer this to other Qualified Bidders that have validly submitted bids

[47] Certainly. there is no question that the Filipino will have to be allowed to match the bid of the foreign entity. And if the Filipino matches the bid of a foreign firm the award should go to the Filipino. thereby exceeding the bid of a Filipino. the constitutional fiat is omnipresent to be simply disregarded. where a foreign firm submits the highest bid in a public bidding concerning the grant of rights. while this may neither be expressly stated nor contemplated in the bidding rules. This Court does not discount the apprehension that this policy may discourage foreign investors. bid. the constitutional mandate itself is reason enough not to award the block of shares immediately to the foreign bidder notwithstanding its submission of a higher. In fact.provided that these Qualified Bidders are willing to match the highest bid in terms of price per share. To ignore it would be to sanction a perilous skirting of the basic law. we cannot conceive of a stronger reason than the constitutional injunction itself. Any person therefore desiring to do business in the Philippines or with any of its agencies or instrumentalities is presumed to know his rights and obligations under the Constitution and the laws of the forum. or even the highest. . But the Constitution and laws of the Philippines are understood to be always open to public scrutiny. It must be so if we are to give life and meaning to the Filipino First Policy provision of the 1987 Constitution. For. These are given factors which investors must consider when venturing into business in a foreign jurisdiction. privileges and concessions covering the national economy and patrimony. In the instant case.

.The argument of respondents that petitioner is now estopped from questioning the sale to Renong Berhad since petitioner was well aware from the beginning that a foreigner could participate in the bidding is meritless. Filipinos and foreigners alike were invited to the bidding. Thus we would rather remedy the indiscretion while there is still an opportunity to do so than let the government develop the habit of forgetting that the Constitution lays down the basic conditions and parameters for its actions. To insist on selling the Manila Hotel to foreigners when there is a Filipino group willing to match the bid of the foreign group is to insist that government be treated as any other ordinary market player. But foreigners may be awarded the sale only if no Filipino qualifies. only after it had matched the bid of the foreign firm and the apparent disregard by respondent GSIS of petitioner’s matching bid did the latter have a cause of action. petitioner had not yet matched the bid offered by Renong Berhad. Undoubtedly. Rightly. while petitioner was already preferred at the inception of the bidding because of the constitutional mandate. The miscomprehension of the Constitution is regrettable. regardless of the consequences to the Filipino people. Besides. and bound by its mistakes or gross errors of judgment. In the case before us. Thus it did not have the right or personality then to compel respondent GSIS to accept its earlier bid. there is no time frame for invoking the constitutional safeguard unless perhaps the award has been finally made. or if the qualified Filipino fails to match the highest bid tendered by the foreign entity.

the Court encourages and welcomes more business opportunities but avowedly sanctions the preference for Filipinos whenever such preference is ordained by the Constitution. This Court as the ultimate guardian of the Constitution will never shun. It is worth emphasizing that it is not the intention of this Court to impede and diminish. respondent GSIS is left with no alternative but to award to petitioner the block of shares of MHC and to execute the necessary agreements and documents to effect the sale in accordance not only with the bidding guidelines and procedures but with the Constitution as well. Far from it. the duty of upholding the majesty of the Constitution which it is tasked to defend. the influx of foreign investments. The Filipino First Policy is a product of Philippine nationalism.Since petitioner has already matched the bid price tendered by Renong Berhad pursuant to the bidding rules. The position of the Court on this matter could have not been more appropriately articulated by Chief Justice Narvasa - . under any reasonable circumstance. so must it be enforced. It is embodied in the 1987 Constitution not merely to be used as a guideline for future legislation but primarily to be enforced. The refusal of respondent GSIS to execute the corresponding documents with petitioner as provided in the bidding rules after the latter has matched the bid of the Malaysian firm clearly constitutes grave abuse of discretion. much less undermine.

objective should not be pursued at the expense of national pride and dignity. it is its bounden duty to make sure that they do not violate the Constitution or the laws. the Supreme Court has not been spared criticism for decisions perceived as obstacles to economic progress and development x x x x in connection with a temporary injunction issued by the Court’s First Division against the sale of the Manila Hotel to a Malaysian Firm and its partner. no matter how buffeted by winds of unfair and illinformed criticism. the Court will always defer to the Constitution in the proper . or are not adopted or implemented with grave abuse of discretion amounting to lack or excess of jurisdiction.” Let it be stated for the record once again that while it is no business of the Court to intervene in contracts of the kind referred to or set itself up as the judge of whether they are viable or attainable. nay even a budgetary. It will never shirk that duty. A commercial. certain statements were published in a major daily to the effect that that injunction “again demonstrates that the Philippine legal system can be a major obstacle to doing business here. regardless of the character of the asset.[48] Privatization of a business asset for purposes of enhancing its business viability and preventing further losses. should not take precedence over non-material values.As scrupulously as it has tried to observe that it is not its function to substitute its judgment for that of the legislature or the executive about the wisdom and feasibility of legislation economic in nature. For the Constitution enshrines higher and nobler non-material values. Indeed.

Any interpretation of any constitutional provision must adhere to such basic concept. is not just any commodity to be sold to the highest bidder solely for the sake of privatization. It cannot override the demands of nationalism. We are talking about a hotel where heads of states would prefer to be housed as a strong manifestation of their desire to cloak the dignity of the highest state function to their official visits to the Philippines. with sovereignty residing in the Filipino people and from whom all government authority emanates.a place with a history of grandeur. In this sense. there is nothing so sacrosanct in any economic policy as to draw itself beyond judicial review when the Constitution is involved. Thus the Manila Hotel has played and continues to play a significant role as an authentic repository of twentieth century Philippine history and culture. In nationalism. We are talking about a historic relic that has hosted many of the most important events in the short history of the Philippines as a nation.[50] The Manila Hotel or. after all. We are not talking about an ordinary piece of property in a commercial district. a most historical setting that has played a part in the shaping of a country.[51] .[49] Nationalism is inherent in the very concept of the Philippines being a democratic and republican state. for that matter. is merely a policy.governance of a free society. it has become truly a reflection of the Filipino soul . while laudible. the happiness and welfare of the people must be the goal. 51% of the MHC. The nation-state can have no higher purpose. Protection of foreign investments.

will continue to respect and protect the sanctity of the Constitution. And so we ask: What advantage. the conveyance of this epic exponent of the Filipino psyche to alien hands cannot be less than mephistophelian for it is.This Court cannot extract rhyme nor reason from the determined efforts of respondents to sell the historical landmark . in whatever manner viewed. For. how much dignity will be preserved and realized if the national patrimony is safekept in the hands of a qualified. COMMITTEE ON PRIVATIZATION and OFFICE OF THE GOVERNMENT CORPORATE COUNSEL are directed to CEASE and DESIST from selling 51% of the shares of the Manila Hotel Corporation to RENONG BERHAD. and to ACCEPT the matching bid of petitioner MANILA PRINCE HOTEL CORPORATION to purchase the subject 51% of the shares of the . WHEREFORE. respondents GOVERNMENT SERVICE INSURANCE SYSTEM.to a total stranger. a veritable alienation of a nation’s soul for some pieces of foreign silver. zealous and well-meaning Filipino? This is the plain and simple meaning of the Filipino First Policy provision of the Philippine Constitution. can be gained by the Filipinos if Manila Hotel . MANILA HOTEL CORPORATION.is sold to a non-Filipino? How much of national pride will vanish if the nation’s cultural heritage is entrusted to a foreign entity? On the other hand.and all that it stands for . And this Court.this Grand Old Dame of hotels in Asia . which cannot be equally drawn from a qualified Filipino. indeed. heeding the clarion call of the Constitution and accepting the duty of being the elderly watchman of the nation.

. ALBERTO ROMULO. to issue the necessary clearances and to do such other acts and deeds as may be necessary for the purpose. NICANOR P. and PHILIPPINE PEASANT INSTITUTE. MORALES. NEPTALI GONZALES.R. RODOLFO BIAZON. DEMOKRATIKONG KILUSAN NG MAGBUBUKID NG PILIPINAS. CENTER FOR ALTERNATIVE DEVELOPMENT INITIATIVES. INC. PERLAS and HORACIO R. 118295. NATIONAL ECONOMIC PROTECTIONISM ASSOCIATION. ERNESTO .. GREGORIO ANDOLANA and JOKER ARROYO as members of the House of Representatives and as taxpayers. both as taxpayers. INC. petitioners. LETICIA RAMOS-SHAHANI. as members of the Philippine Senate and as taxpayers. 1997] WIGBERTO E.00 per share and thereafter to execute the necessary agreements and documents to effect the sale. EDGARDO ANGARA.Manila Hotel Corporation at P44. EN BANC [G. CIVIL LIBERTIES UNION. TAÑADA and ANNA DOMINIQUE COSETENG. vs. HEHERSON ALVAREZ. No. LIKAS-KAYANG KAUNLARAN FOUNDATION. PHILIPPINE RURAL RECONSTRUCTION MOVEMENT. AGAPITO AQUINO. in representation of various taxpayers and as nongovernmental organizations. May 2.

in his capacity as Secretary of Budget and Management. ROBERTO SEBASTIAN. in his capacity as Executive Secretary. CARIDAD VALDEHUESA. RAMON REVILLA. in her capacity as National Treasurer. JOSE LINA. abetted by the membership thereto of the vast majority of countries has revolutionized international business and economic relations amongst states. deregulation and privatization.: The emergence on January 1. SALVADOR ENRIQUEZ.HERRERA. It has irreversibly propelled the world towards trade liberalization and economic globalization. are ushering in a new borderless world of business by . Liberalization. in their respective capacities as members of the Philippine Senate who concurred in the ratification by the President of the Philippines of the Agreement Establishing the World Trade Organization. RAUL ROCO. the third-millennium buzz words. in his capacity as Secretary of Foreign Affairs. SANTANINA RASUL. and TEOFISTO T. DECISION PANGANIBAN. GUINGONA. J. ROBERTO DE OCAMPO. in his capacity as Secretary of Trade and Industry. JOHN OSMEÑA. GLORIA MACAPAGAL-ARROYO. in his capacity as Secretary of Finance. 1995 of the World Trade Organization. ORLANDO MERCADO. RIZALINO NAVARRO. ROBERTO ROMULO. respondents. in his capacity as Secretary of Agriculture. globalization. FRANCISCO TATAD and FREDDIE WEBB. BLAS OPLE.

quantitative restrictions.inspired by that grand political body. the International Monetary Fund (IMF) which was to deal with currency problems.” Brief Historical Background To hasten worldwide recovery from the devastation wrought by the Second World War. tax exemptions and currency controls. and the third. However. What remained was . the International Trade Organization (ITO). import quotas.were discussed at Dumbarton Oaks and Bretton Woods. In the words of Peter Drucker. the well-known management guru. the ITO. export subsidies. from other states. unlike the IMF and WB. plans for the establishment of three multilateral institutions -. “Increased participation in the world economy has become the key to domestic economic growth and prosperity.sweeping away as mere historical relics the heretofore traditional modes of promoting and protecting national economies like tariffs. for a variety of reasons. which was to foster order and predictability in world trade and to minimize unilateral protectionist policies that invite challenge. The first was the World Bank (WB) which was to address the rehabilitation and reconstruction of war-ravaged and later developing countries. including its non-ratification by the United States. even retaliation. the second. Finding market niches and becoming the best in specific industries in a market-driven and export-oriented global scenario are replacing age-old “beggar-thyneighbor” policies that unilaterally protect weak and inefficient domestic producers of goods and services. the United Nations -. never took off.

GATT was a collection of treaties governing access to the economies of treaty adherents with no institutionalized body administering the agreements or dependable system of dispute settlement. (the reduction of) costs and uncertainty associated with exporting x x x.only GATT -. particularly agricultural and industrial products. Ramos in two letters to the Senate (infra). the world finally gave birth to that administering body -. trade disputes were settled mainly through negotiations where .with the signing of the “Final Act” in Marrakesh.” The President also saw in the WTO the opening of “new opportunities for the services sector x x x. Heretofore. the Philippines joined WTO as a founding member with the goal. as articulated by President Fidel V. especially its major trading partners.[1] Like many other developing countries. of improving “Philippine access to foreign markets.and this is of special interest to the legal profession . the Philippines . principally the Kennedy Round. through the reduction of tariffs on its exports.the World Trade Organization -. the Tokyo Round and the Uruguay Round.will benefit from the WTO system of dispute settlement by judicial adjudication through the independent WTO settlement bodies called (1) Dispute Settlement Panels and (2) Appellate Tribunal. After half a century and several dizzying rounds of negotiations..” Although the Chief Executive did not expressly mention it in his letter. and (the attraction of) more investments into the country. Morocco and the ratification of the WTO Agreement by its members.the General Agreement on Tariffs and Trade.

deregulated and privatized? These are the main questions raised in this petition for certiorari. on constitutional grounds. domestic materials and locally produced goods. limits and/or impairs” the constitutional powers of both Congress and the Supreme Court. weak and underdeveloped countries were at a disadvantage.solutions were arrived at frequently on the basis of relative bargaining strengths. and where naturally.” Simply stated. does the Philippine Constitution prohibit Philippine participation in worldwide trade liberalization and economic globalization? Does it prescribe Philippine integration into a global economy that is liberalized. prohibition and mandamus under Rule 65 of the Rules of Court praying (1) for the nullification. of the concurrence of the Philippine Senate in the ratification by the President of the Philippines of the Agreement Establishing the World Trade Organization (WTO . the instant petition before this Court assails the WTO Agreement for violating the mandate of the 1987 Constitution to “develop a self-reliant and independent national economy effectively controlled by Filipinos x x x (to) give preference to qualified Filipinos (and to) promote the preferential use of Filipino labor. The Petition in Brief Arguing mainly (1) that the WTO requires the Philippines “to place nationals and products of member-countries on the same footing as Filipinos and local products” and (2) that the WTO “intrudes.

for brevity). the Final Act Embodying the Results of the Uruguay Round of Multilateral Negotiations (Final Act.Agreement. By signing the Final Act. 1994. signed in Marrakesh. Respondent Rizalino Navarro. This concurrence is embodied in Senate Resolution No. the WTO Agreement for the consideration of their respective competent authorities. for brevity). and . 97.[2] Secretary Navarro on behalf of the Republic of the Philippines. 1994. as well as the use of government properties and resources by respondent-heads of various executive offices concerned therewith. The Facts On April 15. agreed: “(a) to submit. Morocco. representing the Government of the Republic of the Philippines. then Secretary of the Department of Trade and Industry (Secretary Navarro. with a view to seeking approval of the Agreement in accordance with their procedures. dated December 14. for brevity) and (2) for the prohibition of its implementation and enforcement through the release and utilization of public funds. as appropriate. the assignment of public officials and employees.

the members of the Philippine Senate received another letter from the President of the Philippines[4] likewise dated August 11.” On August 13. 1994.(b) to adopt the Ministerial Declarations and Decisions. 1994. 1994. the Ministerial Declarations and Decisions. the President of the Philippines certified the necessity of the immediate adoption of P.[3] stating among others that “the Uruguay Round Final Act is hereby submitted to the Senate for its concurrence pursuant to Section 21.”*5+ . a resolution entitled “Concurring in the Ratification of the Agreement Establishing the World Trade Organization. the members of the Philippine Senate received a letter dated August 11. 1994 from the President of the Philippines.” On August 12.” On December 9.S. the Agreement Establishing the World Trade Organization. and the Understanding on Commitments in Financial Services are hereby submitted to the Senate for its concurrence pursuant to Section 21. which stated among others that “the Uruguay Round Final Act. 1083. 1994. Article VII of the Constitution. Article VII of the Constitution.

”*6+ The text of the WTO Agreement is written on pages 137 et seq. 2 and 3 thereto and collectively referred to as Multilateral Trade Agreements. 1994. the Philippine Senate adopted Resolution No. 97 which “Resolved. of Volume I of the 36-volume Uruguay Round of Multilateral Trade Negotiations and includes various agreements and associated legal instruments (identified in the said Agreement as Annexes 1. that the Senate concur. as it hereby concurs. in the ratification by the President of the Philippines of the Agreement Establishing the World Trade Organization. as it is hereby resolved.On December 14. for brevity) as follows: “ANNEX 1 Annex 1A: Multilateral Agreement on Trade in Goods General Agreement on Tariffs and Trade 1994 Agreement on Agriculture Agreement on the Application of Sanitary and Phytosanitary Measures .

Agreement on Textiles and Clothing Agreement on Technical Barriers to Trade Agreement on Trade-Related Investment Measures Agreement on Implementation of Article VI of the Agreement on Tariffs and Trade 1994 General Agreement on Implementation of Article VII of the General on Tariffs and Trade 1994 Agreement on Pre-Shipment Inspection Agreement on Rules of Origin Agreement on Imports Licensing Procedures Agreement on Subsidies and Coordinating Measures .

be it known that I. President of the Republic of the Philippines. 1994. after having seen and considered the . RAMOS.Agreement on Safeguards Annex 1B: General Agreement on Trade in Services and Annexes Annex 1C: Agreement on Trade-Related Aspects of Intellectual Property Rights ANNEX 2 Understanding on Rules and Procedures Governing the Settlement of Disputes ANNEX 3 Trade Policy Review Mechanism” On December 16. FIDEL V. declaring: “NOW THEREFORE. the President of the Philippines signed[7] the Instrument of Ratification.

In his Memorandum dated May 13. notification procedures. 1996. the WTO Agreement ratified by the President of the Philippines is composed of the Agreement Proper and “the associated legal instruments included in Annexes one (1). . signed at Marrakesh.” To emphasize. two (2) and three (3) of that Agreement which are integral parts thereof. do hereby ratify and confirm the same and every Article and Clause thereof.aforementioned Agreement Establishing the World Trade Organization and the agreements and associated legal instruments included in Annexes one (1). two (2) and three (3) of that Agreement which are integral parts thereof. relationship of WTO with the International Monetary Fund (IMF).” On the other hand. such as measures in favor of least developed countries. the Final Act signed by Secretary Navarro embodies not only the WTO Agreement (and its integral annexes aforementioned) but also (1) the Ministerial Declarations and Decisions and (2) the Understanding on Commitments in Financial Services. Morocco on 15 April 1994.[8] the Solicitor General describes these two latter documents as follows: “The Ministerial Decisions and Declarations are twenty-five declarations and decisions on a wide range of matters. and agreements on technical barriers to trade and on dispute settlement.

” On December 29. The Court also requested the Honorable Lilia R. 1996. 1994. to submit a paper. standstill or limitations and qualifications of commitments to existing non-conforming measures. and . After careful deliberation on respondents’ comment and petitioners’ reply thereto. (1) providing a historical background of and (2) summarizing the said agreements. the Court resolved on December 12. to give due course to the petition. 1995. the present petition was filed. During the Oral Argument held on August 27. national treatment. the Court directed: “(a) the petitioners to submit the (1) Senate Committee Report on the matter in controversy and (2) the transcript of proceedings/hearings in the Senate. commercial presence and new financial service.”*9+ for brevity. Switzerland. Bautista. market access. the Philippine Ambassador to the United Nations stationed in Geneva. among other things. hereafter referred to as “Bautista Paper. and the parties thereafter filed their respective memoranda.The Understanding on Commitments in Financial Services dwell on. and definitions of non-resident supplier of financial services.

. 1996.” Petitioners. on January 30. The Issues In their Memorandum dated March 11.” After receipt of the foregoing documents. petitioners summarized the issues as follows: “A. Whether the petition presents a political question or is otherwise not justiciable. 1996. as counsel for respondents. to file (1) a list of Philippine treaties signed prior to the Philippine adherence to the WTO Agreement. 1997. on the other hand. and in another Compliance dated October 24. he listed the various “bilateral or multilateral treaties or international instruments involving derogation of Philippine sovereignty. as soon as possible. 1997. the Court said it would consider the case submitted for resolution. 1996. the Solicitor General submitted a printed copy of the 36-volume Uruguay Round of Multilateral Trade Negotiations.(b) the Solicitor General. which derogate from Philippine sovereignty and (2) copies of the multi-volume WTO Agreement and other documents mentioned in the Final Act. submitted their Compliance dated January 28. In a Compliance dated September 16.

Article XII. 10 and 12. Article VI. under Sec. Whether provisions of the Agreement Establishing the World Trade Organization interfere with the exercise of judicial power.B. and Secs. 1987 Philippine Constitution is ‘vested in the Congress of the Philippines’. 19. all of the 1987 Philippine Constitution. Article II. 2. E. C. Whether the petitioner members of the Senate who participated in the deliberations and voting leading to the concurrence are estopped from impugning the validity of the Agreement Establishing the World Trade Organization or of the validity of the concurrence. restrict and impair Philippine sovereignty specifically the legislative power which. Whether provisions of the Agreement Establishing the World Trade Organization unduly limit. Whether the provisions of the Agreement Establishing the World Trade Organization contravene the provisions of Sec. D. F. Whether the respondent members of the Senate acted in grave abuse of discretion amounting to lack or excess of jurisdiction when they voted for concurrence in the ratification of the constitutionallyinfirm Agreement Establishing the World Trade Organization. .

2. and the Understanding on Commitments in Financial Services. Article II and Sections 10 and 12. Whether or not certain provisions of the Agreement impair the exercise of judicial power by this Honorable Court in promulgating the rules of evidence. restrict or impair the exercise of legislative power by Congress. Ministerial Declaration and Decisions.G. Article XII of the 1987 Constitution. 3. Whether the respondent members of the Senate acted in grave abuse of discretion amounting to lack or excess of jurisdiction when they concurred only in the ratification of the Agreement Establishing the World Trade Organization. Whether or not the provisions of the ‘Agreement Establishing the World Trade Organization and the Agreements and Associated Legal Instruments included in Annexes one (1). spirit and intent of Section 19. . and not with the Presidential submission which included the Final Act. the Solicitor General as counsel for respondents “synthesized the several issues raised by petitioners into the following”:*10+ “1. two (2) and three (3) of that agreement’ cited by petitioners directly contravene or undermine the letter. Whether or not certain provisions of the Agreement unduly limit.” On the other hand.

” By raising and arguing only four issues against the seven presented by petitioners. Whether or not the concurrence of the Senate ‘in the ratification by the President of the Philippines of the Agreement establishing the World Trade Organization’ implied rejection of the treaty embodied in the Final Act. The foregoing notwithstanding. Tañada and Anna Dominique Coseteng) are estopped from joining this suit. the Solicitor General has effectively ignored three. (2) The matter of estoppel will not be taken up because this defense is waivable and the respondents have effectively waived it by not pursuing it in any of their pleadings. namely: (1) whether the petition presents a political question or is otherwise not justiciable. in any event.was deliberated upon by the Court and will thus be ruled upon as the first issue. even if .being very fundamental and vital. (2) whether petitioner-members of the Senate (Wigberto E. and (3) whether the respondentmembers of the Senate acted in grave abuse of discretion when they voted for concurrence in the ratification of the WTO Agreement.4. and being a matter that probes into the very jurisdiction of this Court to hear and decide this case -. this Court resolved to deal with these three issues thus: (1) The “political question” issue -. this issue.

During its deliberations on the case. They probably realized that grave constitutional issues. DOES THE PETITION INVOLVE A POLITICAL QUESTION OVER WHICH THIS COURT HAS NO JURISDICTION? . rather than skirted or deflected by procedural matters.[11] To recapitulate. and (3) The issue of alleged grave abuse of discretion on the part of the respondent senators will be taken up as an integral part of the disposition of the four issues raised by the Solicitor General.ruled in respondents’ favor. and that transcendental public interest requires that the substantive issues be met head on and decided on the merits. they are also deemed to have waived the benefit of such issue. who are not vulnerable to the defense of estoppel. expenditures of public funds and serious international commitments of the nation are involved here. the Court noted that the respondents did not question the locus standi of petitioners. the issues that will be ruled upon shortly are: (1) DOES THE PETITION PRESENT A JUSTICIABLE CONTROVERSY? OTHERWISE STATED. will not cause the petition’s dismissal as there are petitioners other than the two senators. Hence.

ARTICLE II. MINISTERIAL DECLARATIONS AND DECISIONS. ARTICLE XII. OR IMPAIR THE EXERCISE OF LEGISLATIVE POWER BY CONGRESS? (4) DO SAID PROVISIONS UNDULY IMPAIR OR INTERFERE WITH THE EXERCISE OF JUDICIAL POWER BY THIS COURT IN PROMULGATING RULES ON EVIDENCE? (5) WAS THE CONCURRENCE OF THE SENATE IN THE WTO AGREEMENT AND ITS ANNEXES SUFFICIENT AND/OR VALID. AND THE UNDERSTANDING ON COMMITMENTS IN FINANCIAL SERVICES? The First Issue: Controversy? Does the Court Have Jurisdiction Over the In seeking to nullify an act of the Philippine Senate on the ground that it contravenes the Constitution.(2) DO THE PROVISIONS OF THE WTO AGREEMENT AND ITS THREE ANNEXES CONTRAVENE SEC. OF THE PHILIPPINE CONSTITUTION? (3) DO THE PROVISIONS OF SAID AGREEMENT AND ITS ANNEXES LIMIT. Where an action of the legislative branch is . RESTRICT. 10 AND 12. 19. AND SECS. CONSIDERING THAT IT DID NOT INCLUDE THE FINAL ACT. the petition no doubt raises a justiciable controversy.

”*13+ The jurisdiction of this Court to adjudicate the matters[14] raised in the petition is clearly set out in the 1987 Constitution. it becomes a legal issue which the Court is bound by constitutional mandate to decide.[17] “the judiciary is the final arbiter on the question of whether or not a branch of government or any of its officials has acted without jurisdiction or in excess of jurisdiction or so capriciously as to constitute an abuse of discretion amounting to .” The foregoing text emphasizes the judicial department’s duty and power to strike down grave abuse of discretion on the part of any branch or instrumentality of government including Congress. It is an innovation in our political law. and to determine whether or not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the government.[16] As explained by former Chief Justice Roberto Concepcion.[15] as follows: “Judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are legally demandable and enforceable.seriously alleged to have infringed the Constitution. “The question thus posed is judicial rather than political.”*12+ Once a “controversy as to the application or interpretation of a constitutional provision is raised before this Court (as in the instant case). The duty (to adjudicate) remains to assure that the supremacy of the Constitution is upheld. it becomes not only the right but in fact the duty of the judiciary to settle the dispute.

taxes. agency. committed by any officer. Indeed. in deciding to take jurisdiction over this petition. prohibition and mandamus are appropriate remedies to raise constitutional issues and to review and/or prohibit/nullify. speedy or adequate remedy in the ordinary course of law. we have no hesitation at all in holding that this petition should be given due course and the vital questions raised therein ruled upon under Rule 65 of the Rules of Court. Rather.[18] it will not shirk. certiorari. As the petition alleges grave abuse of discretion and as there is no other plain. digress from or abandon its sacred duty and authority to uphold the Constitution in matters that involve grave abuse of discretion brought before it in appropriate cases. when proper. We should stress that.excess of jurisdiction. On this. or pass upon the merits of trade liberalization as a policy espoused by said international body. acts of legislative and executive officials. and other import/trade barriers. This is not only a judicial power but a duty to pass judgment on matters of this nature. it will only exercise its constitutional duty “to determine . Neither will it rule on the propriety of the government’s economic policy of reducing/removing tariffs. this Court will not review the wisdom of the decision of the President and the Senate in enlisting the country into the WTO. subsidies.” As this Court has repeatedly and firmly emphasized in many cases. we have no equivocation. quantitative restrictions. instrumentality or department of the government.

and Secs. Specifically. Second Issue: The WTO Agreement and Economic Nationalism This is the lis mota. 19. the “flagship” constitutional provisions referred to are Sec. 10 and 12. of the Constitution. the main issue. Petitioners vigorously argue that the “letter. raised by the petition. which are worded as follows: “Article II DECLARATION OF PRINCIPLES AND STATE POLICIES .whether or not there had been a grave abuse of discretion amounting to lack or excess of jurisdiction” on the part of the Senate in ratifying the WTO Agreement and its three annexes. Article II. Article XII. spirit and intent” of the Constitution mandating “economic nationalism” are violated by the so-called “parity provisions” and “national treatment” clauses scattered in various parts not only of the WTO Agreement and its annexes but also in the Ministerial Decisions and Declarations and in the Understanding on Commitments in Financial Services.

10. xx xx xx xx Article XII NATIONAL ECONOMY AND PATRIMONY xx xx xx xx Sec. x x x. . The State shall develop a self-reliant and independent national economy effectively controlled by Filipinos.xx xx xx xx Sec. The Congress shall enact measures that will encourage the formation and operation of enterprises whose capital is wholly owned by Filipinos. 19.

. for brevity): “Article 2 National Treatment and Quantitative Restrictions. 12. the State shall give preference to qualified Filipinos. The State shall promote the preferential use of Filipino labor.” Petitioners aver that these sacred constitutional principles are desecrated by the following WTO provisions quoted in their memorandum:[19] “a) In the area of investment measures related to trade in goods (TRIMS. and adopt measures that help make them competitive. domestic materials and locally produced goods. privileges.In the grant of rights. and concessions covering the national economy and patrimony. xx xx xx xx Sec.

TRIMS that are inconsistent with the obligation of national treatment provided for in paragraph 4 of Article III of GATT 1994 include those which are mandatory or enforceable under domestic law or under administrative rulings.1. and which require: .” (Agreement on Trade-Related Investment Measures. Without prejudice to other rights and obligations under GATT 1994. Vol. 2. The Annex referred to reads as follows: “ANNEX Illustrative List 1. emphasis supplied). An Illustrative list of TRIMS that are inconsistent with the obligations of general elimination of quantitative restrictions provided for in paragraph I of Article XI of GATT 1994 is contained in the Annex to this Agreement. p. Legal Instruments.22121. or compliance with which is necessary to obtain an advantage. 27. no Member shall apply any TRIM that is inconsistent with the provisions of Article III or Article XI of GATT 1994. Uruguay Round.

in terms of volume or value of products. or . TRIMS that are inconsistent with the obligations of general elimination of quantitative restrictions provided for in paragraph 1 of Article XI of GATT 1994 include those which are mandatory or enforceable under domestic laws or under administrative rulings. 2. and which restrict: (a) the importation by an enterprise of products used in or related to the local production that it exports.(a) the purchase or use by an enterprise of products of domestic origin or from any domestic source. or compliance with which is necessary to obtain an advantage. (b) the importation by an enterprise of products used in or related to its local production by restricting its access to foreign exchange inflows attributable to the enterprise. whether specified in terms of particular products. or (b) that an enterprise’s purchases or use of imported products be limited to an amount related to the volume or value of local products that it exports. or in terms of proportion of volume or value of its local production.

14 September 1948.(c) the exportation or sale for export specified in terms of particular products. 1. GATT 1947. transportation. and Article XXVI of GATT. regulations and requirements affecting their internal sale. for brevity): . the provisions of this paragraph shall not prevent the application of differential internal transportation charges which are based exclusively on the economic operation of the means of transport and not on the nationality of the product. Vol. “b) In the area of trade related aspects of intellectual property rights (TRIPS. p. 27. 62 UMTS 82-84 in relation to paragraph 1(a) of the General Agreement on Tariffs and Trade 1994. or in terms of a preparation of volume or value of its local production. in terms of volume or value of products. Uruguay Round. purchase. as amended by the Protocol Modifying Part II. The paragraph 4 of Article III of GATT 1994 referred to is quoted as follows: The products of the territory of any contracting party imported into the territory of any other contracting party shall be accorded treatment no less favorable than that accorded to like products of national origin in respect of laws. Legal Instruments p. Uruguay Round Legal Documents. distribution or use.177. emphasis supplied).22125. emphasis supplied). Vol.” (Article III. offering for sale.” (Annex to the Agreement on Trade-Related Investment Measures.

A Member may meet the requirement of paragraph I by according to services and service suppliers of any other Member. either formally identical treatment or formally different treatment to that it accords to its own like services and service suppliers. 31. in respect of all measures affecting the supply of services. and subject to any conditions and qualifications set out therein. (par. Legal Instruments...25432 (emphasis supplied) “(c) In the area of the General Agreement on Trade in Services: National Treatment 1. . treatment no less favourable than it accords to its own like services and service suppliers. Vol. In the sectors inscribed in its schedule. Article 3. Agreement on Trade-Related Aspect of Intellectual Property rights.Each Member shall accord to the nationals of other Members treatment no less favourable than that it accords to its own nationals with regard to the protection of intellectual property. p. 1. 2. Uruguay Round. each Member shall accord to services and service suppliers of any other Member.

22610 emphasis supplied). particularly . p.” It is petitioners’ position that the foregoing “national treatment” and “parity provisions” of the WTO Agreement “place nationals and products of member countries on the same footing as Filipinos and local products.3. General Agreement on Trade in Services. Formally identical or formally different treatment shall be considered to be less favourable if it modifies the conditions of completion in favour of services or service suppliers of the Member compared to like services or service suppliers of any other Member. Vol.” in contravention of the “Filipino First” policy of the Constitution.[20] Petitioners further argue that these provisions contravene constitutional limitations on the role exports play in national development and negate the preferential treatment accorded to Filipino labor. regulations and administrative procedures with its obligations as provided in the annexed agreements. (Article XVII. They allegedly render meaningless the phrase “effectively controlled by Filipinos.” The constitutional conflict becomes more manifest when viewed in the context of the clear duty imposed on the Philippines as a WTO member to ensure the conformity of its laws. XII. (2) that these nationalistic portions of the Constitution invoked by petitioners should not be read in isolation but should be related to other relevant provisions of Art. 28. Uruguay Round Legal Instruments. domestic materials and locally produced goods. respondents through the Solicitor General counter (1) that such Charter provisions are not self-executing and merely set out general policies. On the other hand.

Incorporated vs.[23] They are used by the judiciary as aids or as guides in the exercise of its power of judicial review. They do not embody judicially enforceable constitutional rights but guidelines for legislation. 1 and 13 thereof. the cited WTO clauses do not conflict with the Constitution.” The counterpart of this article in the 1935 Constitution*21+ is called the “basic political creed of the nation” by Dean Vicente Sinco.[24] the principles and state policies enumerated in Article II and some sections of Article XII are not “self-executing provisions.” . Declaration of Principles Not Self-Executing By its very title. Article II of the Constitution is a “declaration of principles and state policies.Secs. As held in the leading case of Kilosbayan. (3) that read properly. the disregard of which can give rise to a cause of action in the courts. Morato. and by the legislature in its enactment of laws. We shall now discuss and rule on these arguments. and (4) that the WTO Agreement contains sufficient provisions to protect developing countries like the Philippines from the harshness of sudden trade liberalization.[22] These principles in Article II are not intended to be self-executing principles ready for enforcement through the courts.

they are basically not self-executing. Section 13 (Social Justice) of Article XIII and Section 2 (Educational Values) of Article XIV of the 1987 Constitution. As such. therefore. ‘In general. 1869 violates Sections 11 (Personal Dignity) 12 (Family) and 13 (Role of Youth) of Article II. Pagcor[25] that broad constitutional principles need legislative enactments to implement them. thus: “On petitioners’ allegation that P.” The reasons for denying a cause of action to an alleged infringement of broad constitutional principles are sourced from basic considerations of due process and the lack of judicial authority to wade “into the uncharted ocean of social and economic policy . II.In the same light. we held in Basco vs.D. Vol. p. 2). the 1935 provisions were not intended to be self-executing principles ready for enforcement through the courts. The electorate could express their displeasure with the failure of the executive and the legislature through the language of the ballot. meaning a law should be passed by Congress to clearly define and effectuate such principles. the available remedy was not judicial but political. If the executive and the legislature failed to heed the directives of the article. (Bernas. They were rather directives addressed to the executive and to the legislature. suffice it to state also that these are merely statements of principles and policies.

the court should be understood as simply saying that such a more specific legal right or rights may well exist in our corpus of law. rather than a constitutional or statutory policy. defendants may well be unable to defend themselves intelligently and effectively. It seems to me important that the legal right which is an essential component of a cause of action be a specific.a right cast in language of a significantly lower order of generality than Article II (15) of the Constitution -. and that the trial court should have given petitioners an effective opportunity so to demonstrate. To my mind. before the trial court. Jr. operable legal right. instead of aborting the proceedings on a motion to dismiss. there are due process dimensions to this matter. Justice Florentino P. . or failures to act. imputed to the public respondent by petitioners so that the trial court can validly render judgment granting all or part of the relief prayed for.that is or may be violated by the actions. in other words. One is that unless the legal right claimed to have been violated or disregarded is given specification in operational terms. for at least two (2) reasons. Feliciano in his concurring opinion in Oposa vs..making.[26] explained these reasons as follows: “My suggestion is simply that petitioners must.” Mr. show a more specific legal right -. considering the general policy principles found in the Constitution and the existence of the Philippine Environment Code. Factoran.

where a specific violation of law or applicable regulation is not alleged or proved. our courts have no claim to special technical competence and experience and professional qualification.’ the result will be. petitioners can be expected to fall back on the expanded conception of judicial power in the second paragraph of Section 1 of Article VIII of the Constitution which reads: ‘Section 1. Where no specific.the legislative and executive departments -.must be given a real and effective . then the policy making departments -. to propel courts into the uncharted ocean of social and economic policy making. xxx Judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are legally demandable and enforceable. operable norms and standards are shown to exist.The second is a broader-gauge consideration -. At least in respect of the vast area of environmental protection and management. it is respectfully submitted. and to determine whether or not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the Government.’ (Emphases supplied) When substantive standards as general as ‘the right to a balanced and healthy ecology’ and ‘the right to health’ are combined with remedial standards as broad ranging as ‘a grave abuse of discretion amounting to lack or excess of jurisdiction.

opportunity to fashion and promulgate those norms and standards. should be read and understood in relation to the other sections in said article. especially Secs. 10 and 12 of Article XII. . apart from merely laying down general principles relating to the national economy and patrimony. through industries that make full and efficient use of human and natural resources.” Economic Nationalism Should Be Read with Other Constitutional Mandates to Attain Balanced Development of Economy On the other hand. and to implement them before the courts should intervene. and which are competitive in both domestic and foreign markets. Secs. and an expanding productivity as the key to raising the quality of life for all. especially the underprivileged. a sustained increase in the amount of goods and services produced by the nation for the benefit of the people. The State shall promote industrialization and full employment based on sound agricultural development and agrarian reform. income. However. and wealth. the State shall protect Filipino enterprises against unfair foreign competition and trade practices. 1 and 13 thereof which read: “Section 1. The goals of the national economy are a more equitable distribution of opportunities.

as follows: 1. 1 lays down the basic goals of national economic development. The State shall pursue a trade policy that serves the general welfare and utilizes all forms and arrangements of exchange on the basis of equality and reciprocity. Sec. 13. A sustained increase in the amount of goods and services provided by the nation for the benefit of the people. 2. income and wealth. x x x xxx xxx xxx Sec. A more equitable distribution of opportunities. An expanding productivity as the key to raising the quality of life for all especially the underprivileged.” As pointed out by the Solicitor General. .In the pursuit of these goals. and 3. all sectors of the economy and all regions of the country shall be given optimum opportunity to develop.

. It is per se judicially enforceable.” It is true that in the recent case of Manila Prince Hotel vs. (2) by mandating the State to “adopt measures that help make them competitive. From its very words the provision does not require any legislation to put it in operation. Government Service Insurance System.” However. the Constitution takes into account the realities of the outside world as it requires the pursuit of “a trade policy that serves the general welfare and utilizes all forms and arrangements of exchange on the basis of equality and reciprocity”. Art. et al. XII of the 1987 Constitution is a mandatory.*30+ and speaks of industries “which are competitive in both domestic and foreign markets” as well as of the protection of “Filipino enterprises against unfair foreign competition and trade practices. The issue .[31] this Court held that “Sec. privileges and concessions covering the national economy and patrimony”*27+ and in the use of “Filipino labor.. privileges and concessions covering national economy and patrimony” and not to every aspect of trade and commerce. second par. It refers to exceptions rather than the rule.With these goals in context. as the constitutional provision itself states. positive command which is complete in itself and which needs no further guidelines or implementing laws or rules for its enforcement. the Constitution then ordains the ideals of economic nationalism (1) by expressing preference in favor of qualified Filipinos “in the grant of rights. domestic materials and locally-produced goods”.”*29+ In similar language.*28+ and (3) by requiring the State to “develop a selfreliant and independent national economy effectively controlled by Filipinos. it is enforceable only in regard to “the grants of rights. 10.

while the Constitution indeed mandates a bias in favor of Filipino goods. it allows an exchange on the basis of equality and reciprocity. It did not shut out foreign investments. And we hold that there are. it recognizes the need for business exchange with the rest of the world on the bases of equality and reciprocity and limits protection of Filipino enterprises only against foreign competition and trade practices that are unfair. the Constitution did not intend to pursue an isolationist policy. Unlike in the UN where major states have permanent seats and veto powers in the . as a rule. Rather. XII is selfexecuting or not. frowning only on foreign competition that is unfair. services. In fact.[32] In other words. the issue is whether. While the Constitution does not encourage the unlimited entry of foreign goods. labor and enterprises. 10 of Art.here is not whether this paragraph of Sec. it does not prohibit them either. at the same time. respondents maintain that the WTO itself has some built-in advantages to protect weak and developing economies. which comprise the vast majority of its members. services and investments into the country. WTO Recognizes Need to Protect Weak Economies Upon the other hand. goods and services in the development of the Philippine economy. there are enough balancing provisions in the Constitution to allow the Senate to ratify the Philippine concurrence in the WTO Agreement. All told.

Amendments would require two thirds vote in general. Any member may withdraw from the Agreement upon the expiration of six months from the date of notice of withdrawals. developing countries can form powerful blocs to push their economic agenda more decisively than outside the Organization. Amendments to MFN provisions and the Amendments provision will require assent of all members.”*33+ Hence. poor countries can protect their common interests more effectively through the WTO than through one-on-one negotiations with developed countries. except in cases of interpretation of the Agreement or waiver of the obligation of a member which would require three fourths vote. decisions are made on the basis of sovereign equality. decisions of the Ministerial Conference and the General Council shall be taken by the majority of the votes cast. “WTO decides by consensus whenever possible. otherwise. There is no WTO equivalent of the UN Security Council. This is not merely a matter of practical alliances but a negotiating strategy rooted in law. the basic principles underlying the WTO Agreement recognize the need of developing countries like the Philippines to “share in the growth in international trade commensurate with the needs of their economic development. Within the WTO. with each member’s vote equal in weight to that of any other.Security Council.” These basic principles are found in the preamble*34+ of the WTO Agreement as follows: . Thus. in the WTO.

and expanding the production of and trade in goods and services. ensuring full employment and a large and steadily growing volume of real income and effective demand. Being desirous of contributing to these objectives by entering into reciprocal and mutually advantageous arrangements directed to the substantial reduction of tariffs and other barriers to trade and to the elimination of discriminatory treatment in international trade relations. while allowing for the optimal use of the world’s resources in accordance with the objective of sustainable development. secure a share in the growth in international trade commensurate with the needs of their economic development. . Recognizing that their relations in the field of trade and economic endeavour should be conducted with a view to raising standards of living. Recognizing further that there is need for positive efforts designed to ensure that developing countries. and especially the least developed among them.“The Parties to this Agreement. seeking both to protect and preserve the environment and to enhance the means for doing so in a manner consistent with their respective needs and concerns at different levels of economic development.

x x x. therefore. GATT requires an average tariff reduction rate of 36% for developed countries to be effected within a period of six (6) years while developing countries -. Specifically. preferential treatment is given to developing countries in terms of the amount of tariff reduction and the period within which the reduction is to be spread out. the WTO Agreement grants developing countries a more lenient treatment. the results of past trade liberalization efforts. more viable and durable multilateral trading system encompassing the General Agreement on Tariffs and Trade. with respect to tariffs in general. Determined to preserve the basic principles and to further the objectives underlying this multilateral trading system. the Solicitor General points out that pursuant to and consistent with the foregoing basic principles.Resolved. Thus. and all of the results of the Uruguay Round of Multilateral Trade Negotiations. . giving their domestic industries some protection from the rush of foreign competition.including the Philippines -are required to effect an average tariff reduction of only 24% within ten (10) years. to develop an integrated.) Specific WTO Provisos Protect Developing Countries So too.” (underscoring supplied.

the Philippines can avail of these measures. GATT itself has provided built-in protection from unfair foreign competition and trade practices including anti-dumping measures. Where local businesses are jeopardized by unfair foreign competition. the weaker situations of developing nations like the Philippines have been taken into account. as compared to only 13% for developing countries to be effected within ten (10) years. countervailing measures and safeguards against import surges. local industries and enterprises will all be wiped out and that Filipinos will be deprived of control of the economy. however. Moreover. GATT requires developed countries to reduce domestic support to agricultural products by 20% over six (6) years. they have made a bold decision to steer the ship of state into the yet uncharted sea of economic liberalization. GATT requires developed countries to reduce their budgetary outlays for export subsidy by 36% and export volumes receiving export subsidy by 21% within a period of six (6) years. the respondents have gravely abused their discretion. True. Quite the contrary. But such decision cannot be set aside on the ground of grave abuse of . the reduction rate is only two-thirds of that prescribed for developed countries and a longer period of ten (10) years within which to effect such reduction. there would be no basis to say that in joining the WTO. thus.In respect to domestic subsidy. There is hardly therefore any basis for the statement that under the WTO. In regard to export subsidy for agricultural products. For developing countries.

the constitutional policy of a “self-reliant and independent national economy”*35+ does not necessarily rule out the entry of foreign investments. It does not mean autarky or economic seclusion. especially in such strategic industries as in the development of natural resources and public utilities. sponsor of this constitutional policy: “Economic self-reliance is a primary objective of a developing country that is keenly aware of overdependence on external assistance for even its most basic needs. As earlier stated.discretion. It will only perform its constitutional duty of determining whether the Senate committed grave abuse of discretion. it means avoiding mendicancy in the international community.”*36+ .” As explained by Constitutional Commissioner Bernardo Villegas. It contemplates neither “economic seclusion” nor “mendicancy in the international community. simply because we disagree with it or simply because we believe only in other economic policies. Independence refers to the freedom from undue foreign control of the national economy. Constitution Does Not Rule Out Foreign Competition Furthermore. the Court in taking jurisdiction of this case will not pass upon the advantages and disadvantages of trade liberalization as an economic policy. goods and services. rather.

respondents claim that WTO/GATT aims to make available to the Filipino consumer the best goods and services obtainable anywhere in the world at the most reasonable prices. Constitution Favors Consumers.The WTO reliance on “most favored nation. Indeed. Filipino entrepreneurs and managers in Hongkong have demonstrated the Filipino capacity to grow and to prosper against the best offered under a policy of laissez faire. And given a free trade environment. Not Industries or Enterprises The Constitution has not really shown any unbalanced bias in favor of any business or enterprise.” thereby demonstrating a clear policy against a sheltered domestic trade environment.”*37+ the fundamental law encourages industries that are “competitive in both domestic and foreign markets. but one in favor of the gradual development of robust industries that can compete with the best in the foreign markets. Filipino managers and Filipino enterprises have shown capability and tenacity to compete internationally. Aside from envisioning a trade policy based on “equality and reciprocity. On the other hand.” and “trade without discrimination” cannot be struck down as unconstitutional as in fact they are rules of equality and reciprocity that apply to all WTO members.” “national treatment. . Consequently. the question boils down to whether WTO/GATT will favor the general welfare of the public at large. nor does it contain any specific pronouncement that Filipino companies should be pampered with a total proscription of foreign competition.

By the same token. employment. That does not mean however that the Charter is necessarily flawed in the sense that its framers might not have anticipated the advent of a borderless world of business. purchasing power and quality products at the most reasonable rates to the Filipino public? The responses to these questions involve “judgment calls” by our policy makers. the United Nations was not yet in .as promised by its promoters -. Such questions and the answers thereto are not subject to judicial pronouncements based on grave abuse of discretion. for which they are answerable to our people during appropriate electoral exercises.Will adherence to the WTO treaty bring this ideal (of favoring the general welfare) to reality? Will WTO/GATT succeed in promoting the Filipinos’ general welfare because it will -. Constitution Designed to Meet Future Events and Contingencies No doubt.expand the country’s exports and generate more employment? Will it bring more prosperity. the WTO Agreement was not yet in existence when the Constitution was drafted and ratified in 1987.

existence when the 1935 Constitution became effective. thereby effectively surrendering part of its control over its foreign relations to the decisions of various UN organs like the Security Council? It is not difficult to answer this question. It must grow with the society it seeks to re-structure and march apace with the progress of the race. It is but the core of the dream that must take shape. As one eminent political law writer and respected jurist[38] explains: “The Constitution must be quintessential rather than superficial. not in a twinkling by mandate of our delegates. but slowly ‘in the crucible of Filipino minds and hearts. like the goddess Athena. the Constitution cannot.’ where it will in time develop its sinews and gradually gather its strength and finally achieve its substance. Constitutions are designed to meet not only the vagaries of contemporary events. the base and framework only of the edifice that is yet to rise. drawing from the vicissitudes of history the . Did that necessarily mean that the then Constitution might not have contemplated a diminution of the absoluteness of sovereignty when the Philippines signed the UN Charter. It is to the credit of its drafters that a Constitution can withstand the assaults of bigots and infidels but at the same time bend with the refreshing winds of change necessitated by unfolding events. In fine. They should be interpreted to cover even future and unknown circumstances. rise full-grown from the brow of the Constitutional Convention. nor can it conjure by mere fiat an instant Utopia. the root and not the blossom.

regulations and administrative procedures with its obligations as provided in the annexed Agreements.”*39+ Petitioners maintain that this undertaking “unduly limits. import and export quotas. which not only relates to the trade in goods x x x but also to the flow of investments and money x x x as well as to a whole slew of agreements on socio-cultural matters x x x. It is an assault on the sovereign powers of the Philippines because this means that Congress could not pass legislation that will be good for our national interest and general welfare if such legislation will not conform with the WTO Agreement. which is lodged in the Congress.[41] And while the Constitution allows Congress to authorize the President to fix tariff rates. tonnage and wharfage dues. and other duties or imposts. 2. Article VI of the 1987 Philippine Constitution is vested in the Congress of the Philippines. restricts and impairs Philippine sovereignty.” Third Issue: The WTO Agreement and Legislative Power The WTO Agreement provides that “(e)ach Member shall ensure the conformity of its laws. a pulsing. petitioners claim that said WTO proviso derogates from the power to tax.”*40+ More specifically. such authority is subject to “specified limits and x x x such limitations and restrictions” as Congress may . specifically the legislative power which under Sec. far from becoming a petrified rule.dynamism and vitality that will keep it. living law attuned to the heartbeat of the nation.

justice. which are considered to be automatically part of our own laws. the Constitution “adopts the generally accepted principles of international law as part of the law of the land.international agreements must be performed in good faith. the country is bound by generally accepted principles of international law. and adheres to the policy of peace. Sovereignty Limited by International Law and Treaties This Court notes and appreciates the ferocity and passion by which petitioners stressed their arguments on this issue. A state which has contracted valid international obligations is bound to make in its legislations such modifications as may be necessary to ensure the fulfillment of the obligations undertaken."[43] By the doctrine of incorporation. In its Declaration of Principles and State Policies. it is however subject to restrictions and limitations voluntarily agreed to by the Philippines. freedom. “A treaty engagement is not a mere moral obligation but creates a legally binding obligation on the parties x x x. However. the Constitution did not envision a hermit-type isolation of the country from the rest of the world.”*45+ . while sovereignty has traditionally been deemed absolute and allencompassing on the domestic level. cooperation and amity. expressly or impliedly.[42] as in fact it did under Sec.[44] One of the oldest and most fundamental rules in international law is pacta sunt servanda -. with all nations.provide. as a member of the family of nations. Unquestionably. 401 of the Tariff and Customs Code. equality.

Thus.By their inherent nature. like individuals. The age of self-sufficient nationalism is over. the sale or cession of territory.”*47+ UN Charter and Other Treaties Limit Sovereignty Thus. the formation of alliances. the lease of naval bases. the termination of war. states. treaties have been used to record agreements between States concerning such widely diverse matters as.[46] The sovereignty of a state therefore cannot in fact and in reality be considered absolute. nations may surrender some aspects of their state power in exchange for greater benefits granted by or derived from a convention or pact. the settling of claims. After all. they also commonly agree to limit the exercise of their otherwise absolute rights. no nation can build its destiny alone. By their voluntary act. Certain restrictions enter into the picture: (1) limitations imposed by the very nature of membership in the family of nations and (2) limitations imposed by treaty stipulations. “Today. the regulation of commercial relations. treaties really limit or restrict the absoluteness of sovereignty. live with coequals. the regulation of conduct of hostilities. when the Philippines joined the United Nations as one of its 51 charter members. the laying down of rules governing conduct in peace and the establishment of international organizations. it consented to restrict its sovereign rights under . for example. and in pursuit of mutually covenanted objectives and benefits. The age of interdependence is here. As aptly put by John F. Kennedy.

under Article 105 of the said Charter. A final example: under Article 103. So too. the International Court of Justice held that money used by the United Nations Emergency Force in the Middle East and in the Congo were “expenses of the United Nations” under Article 17. In this sense. It is compelled to appropriate funds whether it agrees with such peacekeeping expenses or not. “(i)n the event of a conflict between the obligations of the Members of the United Nations under the present Charter and their obligations under any other international agreement.” Such assistance includes payment of its corresponding share not merely in administrative expenses but also in expenditures for the peace-keeping operations of the organization. paragraph 2. such provisos are however subject to enforcement measures decided by the Security Council for the maintenance of international peace and security under Chapter VII of the Charter. the UN and its representatives enjoy diplomatic privileges and immunities. In its advisory opinion of July 20. of the UN Charter. Hence. Another example: although “sovereign equality” and “domestic jurisdiction” of all members are set forth as underlying principles in the UN Charter. 1961.the “concept of sovereignty as auto-limitation. thereby limiting again the exercise of sovereignty of members within their own territory.” thus unquestionably denying the Philippines -- . all its members must bear their corresponding share in such expenses. and shall refrain from giving assistance to any state against which the United Nations is taking preventive or enforcement action. “(a)ll members shall give the United Nations every assistance in any action it takes in accordance with the present Charter. their obligation under the present charter shall prevail. the Philippine Congress is restricted in its power to appropriate.”47-A Under Article 2 of the UN Charter.

that involve limitations on Philippine sovereignty. Likewise. Apart from the UN Treaty. providing. in said convention. the Export/Import Bank of the United States. to exempt from tax. . where the Philippines agreed. for the avoidance of double taxation with respect to taxes on income. wages. the Philippines has entered into many other international pacts -. These are enumerated by the Solicitor General in his Compliance dated October 24.the sovereign power to make a choice as to which of conflicting obligations.both bilateral and multilateral -. the Overseas Private Investment Corporation of the United States. to honor. (b) Bilateral agreement with Belgium. among others. salaries and similar remunerations paid by the United States to its citizens for labor and personal services performed by them as employees or officials of the United States are exempt from income tax by the Philippines. as follows: “(a) Bilateral convention with the United States regarding taxes on income. the Federal Reserve Bank of the United States. among others. income received in the Philippines by. among others. (c) Bilateral convention with the Kingdom of Sweden for the avoidance of double taxation. 1996.as a member -. if any.

stores on board Japanese aircrafts while on Philippine soil. excise taxes. (h) Bilateral notes with Israel for the abolition of transit and visitor visas where the Philippines exempted Israeli nationals from the requirement of obtaining transit or visitor visas for a sojourn in the Philippines not exceeding 59 days. inspection fees and other duties or taxes aircrafts of South Korea and the regular equipment. (g) Bilateral air service agreement with Belgium where the Philippines granted Belgian air carriers the same privileges as those granted to Japanese and Korean air carriers under separate air service agreements. spare parts. inspection fees and other similar duties. where the Philippines agreed to exempt from customs duties. spare parts and supplies arriving with said aircrafts. taxes or charges fuel. . regular equipment.(d) Bilateral convention with the French Republic for the avoidance of double taxation. (f) Bilateral air service agreement with Japan. (e) Bilateral air transport agreement with Korea where the Philippines agreed to exempt from all customs duties. lubricating oils.

(I) Bilateral agreement with France exempting French nationals from the requirement of obtaining transit and visitor visa for a sojourn not exceeding 59 days. the Philippines has effectively agreed to limit the exercise of its sovereign powers of taxation. eminent domain . Special Missions are also exempted from customs duties. would constitute a breach of international obligation. taxes and related charges. if established. any question of international law. where the Philippines agreed that premises of Special Missions in the Philippines are inviolable and its agents can not enter said premises without consent of the Head of Mission concerned. (j) Multilateral Convention on Special Missions. (k) Multilateral Convention on the Law of Treaties. (l) Declaration of the President of the Philippines accepting compulsory jurisdiction of the International Court of Justice. In this convention. The International Court of Justice has jurisdiction in all legal disputes concerning the interpretation of a treaty.” In the foregoing treaties. the Philippines agreed to be governed by the Vienna Convention on the Law of Treaties. the existence of any fact which.

constrain domestic political sovereignty through the assumption of external obligations. smaller countries typically stand to gain disproportionately from trade liberalization. whether relating to nuclear disarmament. based on the rationale that the Philippines “adopts the generally accepted . a portion of sovereignty may be waived without violating the Constitution. the law of the sea.and police power. as shown by the foregoing treaties. But unless anarchy in international relations is preferred as an alternative. human rights. The underlying consideration in this partial surrender of sovereignty is the reciprocal commitment of the other contracting states in granting the same privilege and immunities to the Philippines.”*48+ The point is that. in most cases we accept that the benefits of the reciprocal obligations involved outweigh the costs associated with any loss of political sovereignty. In addition. by subjecting power relations to some form of legal ordering. well-defined substantive norms and objective dispute resolution procedures reduce the risks of larger countries exploiting raw economic power to bully smaller countries. (T)rade treaties that structure relations by reference to durable. the environment. The same reciprocity characterizes the Philippine commitments under WTO-GATT. “International treaties. its officials and its citizens. This is due to the simple fact that liberalization will provide access to a larger set of potential new trading relationship than in case of the larger country gaining enhanced success to the smaller country’s market. or trade.

Article 34 of the General Provisions and Basic Principles of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)[49] intrudes on the power of the Supreme Court to promulgate rules concerning pleading. practice and procedures.[50] To understand the scope and meaning of Article 34.[51] it will be fruitful to restate its full text as follows: “Article 34 Process Patents: Burden of Proof 1. For the purposes of civil proceedings in respect of the infringement of the rights of the owner referred to in paragraph 1(b) of Article 28.” Fourth Issue: The WTO Agreement and Judicial Power Petitioners aver that paragraph 1.principles of international law as part of the law of the land and adheres to the policy of x x x cooperation and amity with all nations. if the subject matter of a patent is a process for obtaining a product. the judicial authorities shall have the authority to order the defendant to prove that the process to obtain an identical product is different from . TRIPS.

that any identical product when produced without the consent of the patent owner shall.the patented process. Any Member shall be free to provide that the burden of proof indicated in paragraph 1 shall be on the alleged infringer only if the condition referred to in subparagraph (a) is fulfilled or only if the condition referred to in subparagraph (b) is fulfilled. (b) if there is a substantial likelihood that the identical product was made by the process and the owner of the patent has been unable through reasonable efforts to determine the process actually used. in at least one of the following circumstances. In the adduction of proof to the contrary. 2. Therefore.” From the above. 3. Members shall provide. in the absence of proof to the contrary. a WTO Member is required to provide a rule of disputable (note the words “in the absence of proof to the contrary”) presumption that a product shown to be identical to one produced . be deemed to have been obtained by the patented process: (a) if the product obtained by the patented process is new. the legitimate interests of defendants in protecting their manufacturing and business secrets shall be taken into account.

actually refers to the “burden of evidence” (burden of going forward) placed on the producer of the identical (or fake) product to show that his product was produced without the use of the patented process. The foregoing notwithstanding. Hence. regardless of the presumption provided under paragraph 1 of Article 34. the patent owner still has the “burden of proof” since. Such burden. the fact that it is “identical” to the genuine one produced by the patented process and the fact of “newness” of the genuine product or the fact of “substantial likelihood” that the identical product was made by the patented process. provides a similar . (1) where such product obtained by the patented product is new. otherwise known as the Patent Law. Republic Act No. such owner still has to introduce evidence of the existence of the alleged identical product. as amended. 165. or (2) where there is “substantial likelihood” that the identical product was made with the use of the said patented process but the owner of the patent could not determine the exact process used in obtaining such identical product. The foregoing should really present no problem in changing the rules of evidence as the present law on the subject.with the use of a patented process shall be deemed to have been obtained by the (illegal) use of the said patented process. properly understood. the “burden of proof” contemplated by Article 34 should actually be understood as the duty of the alleged patent infringer to overthrow such presumption.

60.Infringement of a design patent or of a patent for utility model shall consist in unauthorized copying of the patented design or utility model for the purpose of trade or industry in the article or product and in the making. thus: “SEC. Where either of these two provisos does not obtain.will apply to this fourth issue also. if any actually exists. Identity or substantial identity with the patented design or utility model shall constitute evidence of copying. using or selling of the article or product copying the patented design or utility model. By and large. it should be noted that the requirement of Article 34 to provide a disputable presumption applies only if (1) the product obtained by the patented process is NEW or (2) there is a substantial likelihood that the identical product was made by the process and the process owner has not been able through reasonable effort to determine the process used.presumption in cases of infringement of patented design or utility model. Besides. Infringement.derogation of legislative power . the arguments adduced in connection with our disposition of the third issue -. members shall be free to determine the appropriate method of implementing the provisions of TRIPS within their own internal systems and processes. . .” (underscoring supplied) Moreover. Article 34 does not contain an unreasonable burden. Suffice it to say that the reciprocity clause more than justifies such intrusion.

is an instrument which records the winding up of the proceedings of a diplomatic . the adjustment in legislation and rules of procedure will not be substantial. since the Philippine is a signatory to most international conventions on patents.but not in the other documents referred to in the Final Act. namely the Ministerial Declaration and Decisions and the Understanding on Commitments in Financial Services -. trademarks and copyrights. So too. in representation of the Republic upon authority of the President.is defective and insufficient and thus constitutes abuse of discretion. sometimes called protocol de clôture. They contend that the second letter of the President to the Senate[53] which enumerated what constitutes the Final Act should have been the subject of concurrence of the Senate. “A final act. They submit that such concurrence in the WTO Agreement alone is flawed because it is in effect a rejection of the Final Act. which in turn was the document signed by Secretary Navarro.consistent as it is with due process and the concept of adversarial dispute settlement inherent in our judicial system.[52] Fifth Issue: Concurrence Only in the WTO Agreement and Not in Other Documents Contained in the Final Act Petitioners allege that the Senate concurrence in the WTO Agreement and its annexes -.

Secretary Navarro as representative of the Republic of the Philippines undertook: "(a) to submit. The text of the “Final Act Embodying the Results of the Uruguay Round of Multilateral Trade Negotiations” is contained in just one page[55] in Vol. conventions.”*54+ It is not the treaty itself. It is rather a summary of the proceedings of a protracted conference which may have taken place over several years. namely. 97 expressed concurrence in exactly what the Final Act required from its signatories. The Ministerial Declarations and Decisions were deemed adopted without need for ratification. the WTO Agreement for the consideration of their respective competent authorities with a view to seeking approval of the Agreement in accordance with their procedures. I of the 36-volume Uruguay Round of Multilateral Trade Negotiations. By signing said Final Act. and (b) to adopt the Ministerial Declarations and Decisions. as appropriate." The assailed Senate Resolution No.conference and usually includes a reproduction of the texts of treaties. recommendations and other acts agreed upon and signed by the plenipotentiaries attending the conference. concurrence of the Senate in the WTO Agreement. They were approved by the ministers .

by virtue of Article XXV: 1 of GATT which provides that representatives of the members can meet “to give effect to those provisions of this Agreement which invoke joint action. free transfer and processing of information. the WTO Agreement itself expresses what multilateral agreements are deemed included as its integral parts. expansion of operation of existing financial service suppliers. and national treatment with respect to access to payment. clearing systems and refinancing available in the normal course of business. elimination of monopoly. It applies only to those 27 Members which “have indicated in their respective schedules of commitments on standstill. temporary entry of personnel.”*56+ The Understanding on Commitments in Financial Services also approved in Marrakesh does not apply to the Philippines.”*57+ On the other hand. and generally with a view to facilitating the operation and furthering the objectives of this Agreement.[58] as follows: “Article II Scope of the WTO .

2. The Plurilateral Trade Agreements do not create either obligation or rights for Members that have not accepted them. The WTO shall provide the common institutional framework for the conduct of trade relations among its Members in matters to the agreements and associated legal instruments included in the Annexes to this Agreement. dated 30 October 1947.1. amended or modified (hereinafter referred to as “GATT 1947”). and are binding on those Members. The Agreements and associated legal instruments included in Annexes 1. 3. 4. 2. The General Agreement on Tariffs and Trade 1994 as specified in annex 1A (hereinafter referred to as “GATT 1994”) is legally distinct from the General Agreement on Tariffs and Trade. . annexed to the Final Act adopted at the conclusion of the Second Session of the Preparatory Committee of the United Nations Conference on Trade and Employment. The Agreements and associated legal instruments included in Annex 4 (hereinafter referred to as “Plurilateral Trade Agreements”) are also part of this Agreement for those Members that have accepted them. and 3 (hereinafter referred to as “Multilateral Agreements”) are integral parts of this Agreement. binding on all Members. as subsequently rectified.

That suggestion was to treat the proceedings of the Committee as being in the nature of briefings for Senators until the question of the submission could be clarified. . 1994. Chairman. as follows: [60] “THE CHAIRMAN: Yes. ROMULO: Mr. Secretary Romulo. And so. 1994. After reading the letter of President Ramos dated August 11. is the President submitting a new. the question of the validity of the submission came up in the first day hearing of this Committee yesterday.It should be added that the Senate was well-aware of what it was concurring in as shown by the members’ deliberation on August 25. it was his intention to clarify all matters by giving this letter. Was the observation made by Senator Tañada that what was submitted to the Senate was not the agreement on establishing the World Trade Organization by the final act of the Uruguay Round which is not the same as the agreement establishing the World Trade Organization? And on that basis. is he making a new submission which improves on the clarity of the first submission? MR. Senator Tolentino raised a point of order which. to make sure that it is clear cut and there should be no misunderstanding. he agreed to withdraw upon understanding that his suggestion for an alternative solution at that time was acceptable. however.[59] the senators of the Republic minutely dissected what the Senate was concurring in.. in effect.. Now.

Mr. Chairman. Chairman. Can this Committee hear from Senator Tañada and later on Senator Tolentino since they were the ones that raised this question yesterday? Senator Tañada. please. . SEN. Based on what Secretary Romulo has read. . . Mr. SEN. I am now satisfied with the wording of the new submission of President Ramos. but rather the Agreement on the World Trade Organization as well as the Ministerial Declarations and Decisions.THE CHAIRMAN: Thank you. TAÑADA: Thank you. of President Ramos. it would now clearly appear that what is being submitted to the Senate for ratification is not the Final Act of the Uruguay Round. TAÑADA. . and the Understanding and Commitments in Financial Services.

The Constitution does not require us to ratify the Final Act. Mr. and I think it now complies with the provisions of the Constitution. In paragraph 2 of the Final Act. And if that is the one that is being . SEN TOLENTINO. Thank you. it is not the Final Act that was agreed to be submitted to the governments for ratification or acceptance as whatever their constitutional procedures may provide but it is the World Trade Organization Agreement.THE CHAIRMAN. Chairman. The Final Act itself specifies what is going to be submitted to with the governments of the participants. Senator Tañada. It requires us to ratify the Agreement which is now being submitted. we read and I quote: ‘By signing the present Final Act. the representatives agree: (a) to submit as appropriate the WTO Agreement for the consideration of the respective competent authorities with a view to seeking approval of the Agreement in accordance with their procedures.’ In other words. I have not seen the new submission actually transmitted to us but I saw the draft of his earlier. Can we hear from Senator Tolentino? And after him Senator Neptali Gonzales and Senator Lina. and with the Final Act itself.

I would consider the new submission as an act ex abudante cautela. do you want to make any comment on this? SEN. I think it satisfies both the Constitution and the Final Act itself.” . THE CHAIRMAN. Mr. THE CHAIRMAN. SEN. Chairman. LINA. Mr. And they had been adequately reflected in the journal of yesterday’s session and I don’t see any need for repeating the same. Senator Tolentino. I believe.submitted now. Then the new submission is. my views on this matter are already a matter of record. Thank you. stating the obvious and therefore I have no further comment to make. Senator Lina. Now. Mr. Chairman. Senator Gonzales. GONZALES. Thank you. I agree with the observation just made by Senator Gonzales out of the abundance of question. May I call on Senator Gonzales. President. Thank you.

petitioners are invoking this Court’s constitutionally imposed duty “to determine whether or not there has been grave abuse of discretion amounting to lack or excess of jurisdiction” on the part of the Senate in giving its concurrence therein via Senate Resolution No. By grave abuse of discretion is meant such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. It must be grave abuse of discretion as when the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility.[61] Mere abuse of discretion is not enough. a writ of certiorari grounded on grave abuse of discretion may be issued by the Court under Rule 65 of the Rules of Court when it is amply shown that petitioners have no other plain. and must be so patent and so gross as to amount to an evasion of a positive duty or to a virtual refusal to perform the duty enjoined or to act at all in contemplation of law.[62] Failure on the part of the petitioner to show grave abuse of discretion will result in the dismissal of the petition.Epilogue In praying for the nullification of the Philippine ratification of the WTO Agreement. Procedurally. speedy and adequate remedy in the ordinary course of law.[63] . 97.

It is itself a constitutional body independent and coordinate.while serving as judicial and legislative guides -. this Court cannot find any cogent reason to impute grave abuse of discretion to the Senate’s exercise of its power of concurrence in the WTO Agreement granted it by Sec. is one of two sovereign houses of Congress and is thus entitled to great respect in its actions. Unless convincing proof and persuasive arguments are presented to overthrow such presumptions. the alleged impairment of sovereignty in the exercise of legislative and judicial powers is . that broad constitutional principles require the State to develop an independent national economy effectively controlled by Filipinos. and to protect and/or prefer Filipino labor. as alleged by petitioners. this Court will resolve every doubt in its favor. But it is equally true that such principles -. So too.are not in themselves sources of causes of action. whose act is under review. Using the foregoing well-accepted definition of grave abuse of discretion and the presumption of regularity in the Senate’s processes. domestic materials and locally produced goods. 21 of Article VII of the Constitution. and thus its actions are presumed regular and done in good faith.[64] It is true. products.In rendering this Decision. this Court never forgets that the Senate.” thereby justifying its acceptance of said treaty. there are other equally fundamental constitutional principles relied upon by the Senate which mandate the pursuit of a “trade policy that serves the general welfare and utilizes all forms and arrangements of exchange on the basis of equality and reciprocity” and the promotion of industries “which are competitive in both domestic and foreign markets. Moreover.

But that is not a legal reason to attribute grave abuse of discretion to the Senate and to nullify its decision. . After all. may even agree with petitioners that it is more advantageous to the national interest to strike down Senate Resolution No. should this be the political desire of a member. Ineludably. To do so would constitute grave abuse in the exercise of our own judicial power and duty. the WTO Agreement allows withdrawal of membership. or at least some of its members. We find no “patent and gross” arbitrariness or despotism “by reason of passion or personal hostility” in such exercise. That the Senate. It is not impossible to surmise that this Court. That is a matter between the elected policy makers and the people. 97.balanced by the adoption of the generally accepted principles of international law as part of the law of the land and the adherence of the Constitution to the policy of cooperation and amity with all nations. As to whether such exercise was wise. voluntarily and overwhelmingly gave its consent to the WTO Agreement thereby making it “a part of the law of the land” is a legitimate exercise of its sovereign duty and power. what the Senate did was a valid exercise of its authority. beneficial or viable is outside the realm of judicial inquiry and review. As to whether the nation should join the worldwide march toward trade liberalization and economic globalization is a matter that our people should determine in electing their policy makers. after deliberation and voting.

The alternative to WTO is isolation. There are at present about 31 countries including China. lawphil Today is Saturday. make their free choice. politically and culturally in the next century. the Philippines now straddles the crossroads of an international strategy for economic prosperity and stability in the new millennium. the WTO remains as the only viable structure for multilateral trading and the veritable forum for the development of international trade law. 2012 . Notwithstanding objections against possible limitations on national sovereignty. through their duly authorized elected officers. Let the people. Russia and Saudi Arabia negotiating for membership in the WTO. if not economic self-destruction.” He refers to the “free market” espoused by WTO as the “catalyst” in this coming Asian ascendancy. predicts an Asian Renaissance*65+ where “the East will become the dominant region of the world economically. author of the best seller Megatrends. Duly enriched with original membership. the petition is DISMISSED for lack of merit. stagnation. November 17. keenly aware of the advantages and disadvantages of globalization with its on-line experience. and endowed with a vision of the future.The eminent futurist John Naisbitt. WHEREFORE.

PADRIGANO RUFINO. respondents. petitioners. Castillo and J.S. and COURT OF INDUSTRIAL RELATIONS.Republic of the Philippines SUPREME COURT Manila EN BANC G. Espinas & Associates for petitioners. BENJAMIN PAGCU and RODULFO MUNSOD. vs. BONIFACIO VACUNA. L-31195 June 5. .R. FLORENCIO.. 1973 PHILIPPINE BLOOMING MILLS EMPLOYMENT ORGANIZATION. ROXAS MARIANO DE LEON. Osorio & P. ASENCION PACIENTE. No. INC. L. PHILIPPINE BLOOMING MILLS CO.B.C. NICANOR TOLENTINO.

Florencio Padrigano.M.. to 2 P.. and from 8 A. Rufino Roxas.Demetrio B.. Benjamin Pagcu and Rodulfo Munsod are officers and members of the petitioner Union. Mariano de Leon. in protest against alleged abuses of the Pasig police. they decided to stage a mass demonstration at Malacañang on March 4. Asencion Paciente. Bonifacio Vacuna. . to 4 P.M.) as well as those in the regular second and third shifts (from 7 A.M.: The petitioner Philippine Blooming Mills Employees Organization (hereinafter referred to as PBMEO) is a legitimate labor union composed of the employees of the respondent Philippine Blooming Mills Co. to be participated in by the workers in the first shift (from 6 A. 1969. Salem & Associates for private respondent. J. Inc.M. and petitioners Nicanor Tolentino. MAKASIAR.M. 1969.M. to 5 P. and that they informed the respondent Company of their proposed demonstration. respectively). Petitioners claim that on March 1.

. 5. That the Company asked the union panel to confirm or deny said projected mass demonstration at Malacañang on March 4. at the Company's canteen. Jr. (2) Rufino Roxas. Pagcu explained further that the demonstration has nothing to do with the Company because the union has no quarrel or dispute with Management. confirmed the planned demonstration and stated that the demonstration or rally cannot be cancelled because it has already been agreed upon in the meeting. (3) Mariano de Leon.M.M. Arthur L. of Associate Judge Joaquin M. 1969. PBMEO thru Benjamin Pagcu who acted as spokesman of the union panel. 1969. For the PBMEO (1) Florencio Padrigano. and those present were: for the Company: (1) Mr. . de Leon. Salvador of the respondent Court reproduced the following stipulation of facts of the parties — parties — 3. (3) and all department and section heads. Ang (2) Atty. S. 1969 complainant company learned of the projected mass demonstration at Malacañang in protest against alleged abuses of the Pasig Police Department to be participated by the first shift (6:00 AM-2:00 PM) workers as well as those working in the regular shifts (7:00 A. 1969 at about 11:00 A. That on March 2. 4. to 4:00 PM and 8:00 AM to 5:00 PM) in the morning of March 4. (5) Bonifacio Vacuna and (6) Benjamin Pagcu. 1969. (4) Asencion Paciente. That a meeting was called by the Company on March 3.The questioned order dated September 15.

and thus utilize the workers in the 2nd and 3rd shifts in order not to violate the provisions of the CBA. particularly Article XXIV: NO LOCKOUT — NO STRIKE'. All those who will not follow this warning of the Company shall be dismiss.S. C. the officers present who are the organizers of the demonstration. that any demonstration for that matter should not unduly prejudice the normal operation of the Company. another meeting was convoked Company represented by Atty.M. That at about 5:00 P. Company reiterated and appealed to the PBMEO representatives that while all workers may join the Malacañang demonstration. In this afternoon meeting of March 3. C. Jr. C. the Company.6. would be amounting to an illegal strike. 1969. on March 3. however. who without previous leave of absence approved by the Company. Benjamin Pagcu and Florencio Padrigano. That Management. Rodolfo Munsod. Company personnel manager. 1969. the workers for the first and regular shift of March 4. De Leon reiterated the . thru Atty. 1969) shall be dismissed. The Union panel was composed of: Nicanor Tolentino. de Leon. who shall fail to report for work the following morning (March 4. particularly . thru Atty.S. informed PBMEO that the demonstration is an inalienable right of the union guaranteed by the Constitution but emphasized.S. For which reason. therefore. 7. 1969 should be excused from joining the demonstration and should report for work. de Leon. because such failure is a violation of the existing CBA and. de Leon warned the PBMEO representatives that workers who belong to the first and regular shifts.

all of Republic Act No. with the respondent Court.M. respondent Company prior notice of the mass demonstration on March 4. rec.M. pp. The charge was accompanied by the joint affidavit of Arthur L.). a charge against petitioners and other employees who composed the first shift.). Annex "F". pp.) Because the petitioners and their members numbering about 400 proceeded with the demonstration despite the pleas of the respondent Company that the first shift workers should not be required to participate in the demonstration and that the workers in the second and third shifts should be utilized for the demonstration from 6 A. 1969. Jr. 1969. and 8. (Annex "B". The union panel countered that it was rather too late to change their plans inasmuch as the Malacañang demonstration will be held the following morning. 19-20. That a certain Mr. 1969. to 2 P. 21-24. and of the CBA providing for 'No Strike and No Lockout. the contents of which are as follows: 'REITERATING REQUEST EXCUSE DAY SHIFT EMPLOYEES JOINING DEMONSTRATION MARCH 4. March 4. 3-8. rec. adviser of PBMEO sent a cablegram to the Company which was received 9:50 A.Company's warning that the officers shall be primarily liable being the organizers of the mass demonstration. Thereafter.' (Pars. 42-43. on March 4. Ang and Cesareo de Leon. rec. by Acting Chief Prosecutor . 1969.' " (Annex "A". dated April 18. Wilfredo Ariston. charging them with a "violation of Section 4(a)-6 in relation to Sections 13 and 14. pp. 875. 1969. as well as Section 15. a corresponding complaint was filed..M.

rec. 31-34. as a consequence. 1969. Judge Joaquin M. Bonifacio Vacuna. 42-56. 1969. 11. pp. Benjamin Pagcu. Tirona and Acting Prosecutor Linda P.) After considering the aforementioned stipulation of facts submitted by the parties. 1969. rec. 1969 fell on Sunday (p. Nicanor Tolentino and Rodulfo Munsod as directly responsible for perpetrating the said unfair labor practice and were. herein petitioners claim that they did not violate the existing CBA because they gave the respondent Company prior notice of the mass demonstration on March 4. Rufino Roxas. that the said mass demonstration was a valid exercise of their constitutional freedom of speech against the alleged abuses of some Pasig policemen.). . Asencion Paciente.). the aforesaid order (p. in an order dated September 15. a motion for reconsideration of said order dated September 15. and that they filed on September 29. and that their mass demonstration was not a declaration of strike because it was not directed against the respondent firm (Annex "D".) In their answer.Antonio T. 1969. 59. dated May 9. Ilagan (Annex "C". pp. Mariano de Leon. Salvador. 1969. 1969. considered to have lost their status as employees of the respondent Company (Annex "F". because September 28. rec. found herein petitioner PBMEO guilty of bargaining in bad faith and herein petitioners Florencio Padrigano. 25-30. rec. pp.) Herein petitioners claim that they received on September 23. rec.

1969. it should be accordingly dismissed. rec. 1969. pp. and that because their motion for reconsideration was two (2) days late. as well as asked for ten (10) days within which to file their arguments pursuant to Sections 15. rec. Castillo. respondent Company averred that herein petitioners received on September 22. 1 which held among others. 1969.). within which to file their motion for reconsideration.). rec. 1969 or until September 27. ) In its opposition dated October 7. 61-64. rec. pp. herein petitioners filed on October 14. 16 and 17 of the Rules of the CIR. 1969 (p. that under Section 15 of the amended Rules of the Court of Industrial Relations. the order dated September 17 (should be September 15). that a motion for extension of the five-day period for the filing of a motion for reconsideration should be filed before the said five-day period elapses (Annex "M". the respondent en banc dismissed the motion for reconsideration of herein petitioners for being pro forma as it was filed beyond the reglementary period . 1969. filed on October 11. In a resolution dated October 9. 1969 their written arguments dated October 11. 65-73. herein petitioners had five (5) days from September 22. pp. 63.on the ground that it is contrary to law and the evidence. 1969. 1969. 57-60. Subsequently. as amended (Annex "G". in support of their motion for reconsideration (Annex "I". invoking Bien vs.).

attaching thereto the affidavits of the said president and clerk (Annexes "K". that a motion for reconsideration shall be filed within five (5) days from receipt of its decision or order and that an appeal from the decision.. rec. 1969. On October 31. as amended. rec.). rec. with the Supreme Court. on the ground that their failure to file their motion for reconsideration on time was due to excusable negligence and honest mistake committed by the president of the petitioner Union and of the office clerk of their counsel. 74-75.I. rec. 12 & 76. 1969. rec.). 1969. 1969. a notice of appeal (Annex "L". 76. resolution or order of the C. herein petitioners filed on November 3. which herein petitioners received on October 28.). 88-89. shall be perfected within ten (10) days from receipt thereof (p. "K-1" and "K-2". pp. 1969. appear the requirements of Sections 15. 16 and 17. herein petitioners filed with the respondent court a petition for relief from the order dated October 9. . sitting en banc. of the Rules of the Court of Industrial Relations.). 196 (pp. which was released on October 24. rec. 1969 and addressed to the counsels of the parties (pp. pp.R. Without waiting for any resolution on their petition for relief from the order dated October 9.). At the bottom of the notice of the order dated October 9.prescribed by its Rules (Annex "J".). 75-76.

to free speech. or ." 2 (2) The Bill of Rights is designed to preserve the ideals of liberty. equality and security "against the assaults of opportunism. the preservation and enhancement of the dignity and worth of the human personality is the central core as well as the cardinal article of faith of our civilization. and to establish them as legal principles to be applied by the courts. Justice Robert Jackson. the expediency of the passing hour. (1) In a democracy.I There is need of briefly restating basic concepts and principles which underlie the issues posed by the case at bar." 3 In the pithy language of Mr. the purpose of the Bill of Rights is to withdraw "certain subjects from the vicissitudes of political controversy. The inviolable character of man as an individual must be "protected to the largest possible extent in his thoughts and in his beliefs as the citadel of his person. One's rights to life. to place them beyond the reach of majorities and officials. and the scorn and derision of those who have no patience with general principles. liberty and property. the erosion of small encroachments.

. or as Socrates insinuated. free assembly and petition. not the well-being of the State. was the criterion by which its behaviour was to be judged. but also to benefit the majority who refuse to listen. freedom of worship and assembly. His interests.free press. and the liberties of one are not safe unless the liberties of all are protected. 6 And as Justice Douglas cogently stresses it. the liberties of one are the liberties of all. Thru these freedoms the citizens can participate not merely in the periodic establishment of the government through their suffrage but also in the administration of public affairs as well as in the discipline of abusive public officers. to his happiness and to his full and complete fulfillment. they depend on the outcome of no elections. not its power. to protect the ideas that we abhor or hate more than the ideas we cherish. and other fundamental rights may not be submitted to a vote." 5 (3) The freedoms of expression and of assembly as well as the right to petition are included among the immunities reserved by the sovereign people. The citizen is accorded these rights so that he can appeal to the appropriate governmental officers or agencies for redress and protection as well as for the imposition of the lawful sanctions on erring public officers and employees." 4 Laski proclaimed that "the happiness of the individual. are not only civil rights but also political rights essential to man's enjoyment of his life. in the rhetorical aphorism of Justice Holmes. set the limits to the authority it was entitled to exercise. 7 (4) The rights of free expression. not only to protect the minority who want to talk.

10 and such priority "gives these liberties the sanctity and the sanction not permitting dubious intrusions." permitting government regulation only "with narrow specificity.(5) While the Bill of Rights also protects property rights. In the hierarchy of civil liberties. the primacy of human rights over property rights is recognized. of the influential and powerful. If human rights are extinguished by the passage of time. as well as supremely precious in our society" and the "threat of sanctions may deter their exercise almost as potently as the actual application of sanctions. but human rights are imprescriptible." 11 The superiority of these freedoms over property rights is underscored by the fact that a mere reasonable or rational relation between the means employed by the law and its object or purpose — . and of oligarchs — political." 9 Property and property rights can be lost thru prescription. the rights of free expression and of assembly occupy a preferred position as they are essential to the preservation and vitality of our civil and political institutions. economic or otherwise. 8 Because these freedoms are "delicate and vulnerable. of majorities." they "need breathing space to survive. then the Bill of Rights is a useless attempt to limit the power of government and ceases to be an efficacious shield against the tyranny of officials.

Justice Castro relies on the balancing-of-interests test. vs. viz." 15 even as Mr. Times Co. 13 It should be added that Mr. discounted by its improbability." herein petitioners are guilty bargaining in bad faith and hence violated the collective bargaining agreement with private respondent . 12 On the other hand. namely existence of a grave and immediate danger of a substantive evil which the State has the right to prevent. supra. concluded that by their "concerted act and the occurrence temporary stoppage of work. 16 Chief Justice Vinson is partial to the improbable danger rule formulated by Chief Judge Learned Hand. 17 II The respondent Court of Industrial Relations. Comelec and reiterated by the writer of the opinion in Imbong vs. after opining that the mass demonstration was not a declaration of strike. like Justices Douglas. Comelec. 14 believes that the freedoms of speech and of the press as well as of peaceful assembly and of petition for redress of grievances are absolute when directed against public officials or "when exercised in relation to our right to choose the men and women by whom we shall be governed. — whether the gravity of the evil.Y. Sullivan. justifies such invasion of free expression as is necessary to avoid the danger.that the law is neither arbitrary nor discriminatory nor oppressive — would suffice to validate a law which restricts or impairs property rights. Justice Fernando in Gonzales vs. Justice Barredo in Gonzales vs. Black and Goldberg in N. Ferrer. a constitutional or valid infringement of human rights requires a more stringent criterion. So it has been stressed in the main opinion of Mr.

herein private respondent firm. Set against and tested by foregoing principles governing a democratic society. Herein respondent employer did not even offer to intercede for its employees with the local police. inc. such conclusion cannot be sustained. Was it securing peace for itself at the expenses of its workers? Was it also intimidated by the local police or did it encourage the local police to terrorize or vex its workers? Its failure to defend its own employees all the more weakened the position of its laborers the alleged oppressive police who might have been all the more emboldened thereby subject its lowly employees to further indignities. It was to the interest herein private respondent firm to rally to the defense of. 1969 before Malacañang was against alleged abuses of some Pasig policemen. The demonstration held petitioners on March 4. As matter of fact. not against their employer. vexation or peril and as consequence perform more efficiently their respective tasks enhance its productivity as well as profits. and take up the cudgels for.Philippine Blooming Mills Co. again the police officers of the municipality of Pasig. . said demonstrate was purely and completely an exercise of their freedom expression in general and of their right of assembly and petition for redress of grievances in particular before appropriate governmental agency. They exercise their civil and political rights for their mutual aid protection from what they believe were police excesses. so that they can report to work free from harassment. the Chief Executive. it was the duty of herein private respondent firm to protect herein petitioner Union and its members fro the harassment of local police officers.. its employees..

As above intimated. The pretension of their employer that it would suffer loss or damage by reason of the absence of its employees from 6 o'clock in the morning to 2 o'clock in the afternoon. the employees and laborers of herein private respondent firm were fighting for their very survival. Material loss can be repaired or adequately compensated. utilizing only the weapons afforded them by the Constitution — the untrammelled enjoyment of their basic human rights. harassment and persecuted as they believed they were by the peace officers of the municipality. 18 Emphatic reiteration of this basic tenet as a coveted boon — at once the shield and armor of the dignity and worth of the human personality. denial of which is like rubbing salt on bruised tissues. the condition in which the employees found themselves vis-a-vis the local police of Pasig.In seeking sanctuary behind their freedom of expression well as their right of assembly and of petition against alleged persecution of local officialdom. the primacy of human rights — freedom of expression. of peaceful assembly and of petition for redress of grievances — over property rights has been sustained. The employees' pathetic situation was a stark reality — abused. The wounds fester and the scars remain to humiliate him to his dying day. As heretofore stated. even as he cries in anguish for retribution. is a plea for the preservation merely of their property rights. The debasement of the human being broken in morale and brutalized in spirit-can never be fully evaluated in monetary terms. the all- . Such apprehended loss or damage would not spell the difference between the life and death of the firm or its owners or its management. was a matter that vitally affected their right to individual existence as well as that of their families.

even if it legally appears to be illegal picketing or strike. To regard the demonstration against police officers. according to the respondent Court Industrial Relations. if freedom and social justice have any meaning at all for him who toils so that capital can produce economic goods that can generate happiness for all. Renunciation of the freedom should not be predicated on such a slender ground. 20 The . such an injunction would be trenching upon the freedom expression of the workers. stretches unduly the compass of the collective bargaining agreement. of peaceful assembly and of petition. 19 The collective bargaining agreement which fixes the working shifts of the employees.. 1969 could not have been legally enjoined by any court. as evidence of bad faith in collective bargaining and hence a violation of the collective bargaining agreement and a cause for the dismissal from employment of the demonstrating employees." The strain construction of the Court of Industrial Relations that a stipulated working shifts deny the workers the right to stage mass demonstration against police abuses during working hours..consuming ideal of our enlightened civilization — becomes Our duty. is "a potent means of inhibiting speech" and therefore inflicts a moral as well as mortal wound on the constitutional guarantees of free expression. The mass demonstration staged by the employees on March 4. to observe regular working hours. not against the employer. in effect imposes on the workers the "duty . constitutes a virtual tyranny over the mind and life the workers and deserves severe condemnation.

rec.M.). should report for work in order that loss or damage to the firm will be averted. The more the participants. the absence of one-third of their members will be regarded as a substantial indication of disunity in their ranks which will enervate their position and abet continued alleged police persecution. then by that much the circulation of the issues raised by the demonstration is diminished. Moreover. This stand failed appreciate the sine qua non of an effective demonstration especially by a labor union. p. The respondent firm claims that there was no need for all its employees to participate in the demonstration and that they suggested to the Union that only the first and regular shift from 6 A. 45. 21 If demonstrators are reduced by one-third. the more persons can be apprised of the purpose of the rally. to 2 P." (Annex "F".M.respondent Court of Industrial Relations in the case at bar concedes that the mass demonstration was not a declaration of a strike "as the same not rooted in any industrial dispute although there is concerted act and the occurrence of a temporary stoppage work. At any rate. Circulation is one of the aspects of freedom of expression. namely the complete unity of the Union members as well as their total presence at the demonstration site in order to generate the maximum sympathy for the validity of their cause but also immediately action on the part of the corresponding government agencies with jurisdiction over the issues they raised against the local police. the Union notified the company two days in advance of their projected demonstration and the company could have made arrangements to counteract or prevent whatever losses it might sustain by reason of the absence of its .

not against the company.. 875. mutual aid or protection". while Section 4(a-1) regards as an unfair labor practice for an employer . 1969 which request the Union reiterated in their telegram received by the company at 9:50 in the morning of March 4.workers for one day. Section 3 of Republic Act No. rec. the respondent firm committed an unfair labor practice defined in Section 4(a-1) in relation to Section 3 of Republic Act No. freedom of assembly and freedom petition for redress of grievances. 8 guarantees to the employees the right "to engage in concert activities for . III The respondent company is the one guilty of unfair labor practice. 42-43.). the day of the mass demonstration (pp. is gross vindictiveness on the part of the employer. especially in this case when the Union requested it to excuse only the day-shift employees who will join the demonstration on March 4. There was a lack of human understanding or compassion on the part of the firm in rejecting the request of the Union for excuse from work for the day shifts in order to carry out its mass demonstration.. Because the refusal on the part of the respondent firm to permit all its employees and workers to join the mass demonstration against alleged police abuses and the subsequent separation of the eight (8) petitioners from the service constituted an unconstitutional restraint on the freedom of expression. which is as unchristian as it is unconstitutional. 1969. otherwise known as the Industrial Peace Act. And to regard as a ground for dismissal the mass demonstration held against the Pasig police.

" We repeat that the obvious purpose of the mass demonstration staged by the workers of the respondent firm on March 4. "it is not necessary that union activity be involved or that collective bargaining be contemplated. restrain or coerce employees in the exercise their rights guaranteed in Section Three.interfere with." as long as the concerted activity is for the furtherance of their interests." 22 Such a concerted action for their mutual help and protection deserves at least equal protection as the concerted action of employees in giving publicity to a letter complaint charging bank president with immorality. 1969. 875. that for the employees to come within the protective mantle of Section 3 in relation to Section 4(a-1) on Republic Act No. 23 We further ruled in the Republic Savings Bank case. was for their mutual aid and protection against alleged police abuses. nepotism. was as heretofore stated. 24 . supra. denial of which was interference with or restraint on the right of the employees to engage in such common action to better shield themselves against such alleged police indignities. under pain of dismissal. "a potent means of inhibiting speech. favoritism an discrimination in the appointment and promotion of ban employees. The insistence on the part of the respondent firm that the workers for the morning and regular shift should not participate in the mass demonstration.

despite such threat of dismissal. III. the issues that the employees raised against the local police. 1969) shall be dismissed." nonetheless emphasized that "any demonstration for that matter should not unduly prejudice the normal operation of the company" and "warned the PBMEO representatives that workers who belong to the first and regular shifts. the company. free assembly and the right to petition for redress. Such threat of dismissal tended to coerce the employees from joining the mass demonstration. particularly the officers present who are the organizers of the demonstration. that the demonstration is an inalienable right of the Union guaranteed by the Constitution. more especially if he has a family to support. However.As stated clearly in the stipulation of facts embodied in the questioned order of respondent Court dated September 15. would be amounting to an illegal strike (. petitioner's brief). were more important to them because they had the courage to proceed with the demonstration. they were willing to forego their one-day salary hoping that their demonstration would bring about the desired relief from police abuses. who without previous leave of absence approved by the Company. But management was adamant in refusing to recognize the superior legitimacy of their right of free speech. because such failure is a violation of the existing CBA and. The most that could happen to them was to lose a day's wage by reason of their absence from work on the day of the demonstration.)" (p. 1969. who shall fail to report for work the following morning (March 4. One day's pay means much to a laborer. "while expressly acknowledging. therefore. Yet. .

" the respondent Court of Industrial Relations did not make any finding as to the fact of loss actually sustained by the firm. cost of fuel. while the respondent Court of Industrial Relations found that the demonstration "paralyzed to a large extent the operations of the complainant company. Such savings could have amply compensated for unrealized profits or damages it might have sustained by reason of the absence of its workers for only one day. . On the contrary. It did not present evidence as to whether it lost expected profits for failure to comply with purchase orders on that day.Because the respondent company ostensibly did not find it necessary to demand from the workers proof of the truth of the alleged abuses inflicted on them by the local police. This significant circumstance can only mean that the firm did not sustain any loss or damage. or that purchase orders were cancelled by the customers by reason of its failure to deliver the materials ordered. 1969. or that its own equipment or materials or products were damaged due to absence of its workers on March 4. it thereby concedes that the evidence of such abuses should properly be submitted to the corresponding authorities having jurisdiction over their complaint and to whom such complaint may be referred by the President of the Philippines for proper investigation and action with a view to disciplining the local police officers involved. or that penalties were exacted from it by customers whose orders could not be filled that day of the demonstration. water and electric consumption that day. On the other hand. the company saved a sizable amount in the form of wages for its hundreds of workers.

constitutes a denial of social justice likewise assured by the fundamental law to these lowly employees.". the very governmental agency designed therefor. failed to .." It is most unfortunate in the case at bar that respondent Court of Industrial Relations." which guarantee is emphasized by the other directive in Section 6 of Article XIV of the Constitution that "the State shall afford protection to labor . Section 5 of Article II of the Constitution imposes upon the State "the promotion of social justice to insure the well-being and economic security of all of the people. social and economic well-being." Under the Industrial Peace Act. the Court of Industrial Relations is enjoined to effect the policy of the law "to eliminate the causes of industrial unrest by encouraging and protecting the exercise by employees of their right to selforganization for the purpose of collective bargaining and for the promotion of their moral. Respondent Court of Industrial Relations as an agency of the State is under obligation at all times to give meaning and substance to these constitutional guarantees in favor of the working man. the dismissal of the eight (8) leaders of the workers for proceeding with the demonstration and consequently being absent from work..IV Apart from violating the constitutional guarantees of free speech and assembly as well as the right to petition for redress of grievances of the employees. for otherwise these constitutional safeguards would be merely a lot of "meaningless constitutional patter.

and as a consequence its judgment is null and void and confers no rights. may be obtained through habeas corpus proceedings even long after the finality of the judgment.implement this policy and failed to keep faith with its avowed mission — its raison d'etre — as ordained and directed by the Constitution. which violated his constitutional right against self-incrimination. Thus. 25 or who is denied the right to present evidence in his defense as a deprivation of his liberty without due process of law. who is convicted by final judgment through a forced confession. the Court of Industrial Relations ousted itself of jurisdiction and the questioned orders it issued in the instant case are a nullity. 26 even after the accused has already served sentence for twenty-two years. Having violated these basic human rights of the laborers. V It has been likewise established that a violation of a constitutional right divests the court of jurisdiction. 27 Both the respondents Court of Industrial Relations and private firm trenched upon these constitutional immunities of petitioners. Both failed to accord preference to such rights and aggravated the inhumanity to which the aggrieved workers claimed they had been subjected by the municipal police. habeas corpus is the remedy to obtain the release of an individual. Recognition and protection of such freedoms are imperative . Relief from a criminal conviction secured at the sacrifice of constitutional liberties.

The battle then would be reduced to a race for time. 28a VI The Court of Industrial Relations rule prescribes that motion for reconsideration of its order or writ should filed within five (5) days from notice thereof and that the arguments in support of said motion shall be filed within ten (10) days from the date of filing of such motion for reconsideration (Sec. It is a continuing immunity to be invoked and exercised when exigent and expedient whenever there are errors to be rectified.on all public offices including the courts 28 as well as private citizens and corporations. when even a law enacted by Congress must yield to the untrammelled enjoyment of these human rights. the printing of one article or the staging of one demonstration. The right to enjoy them is not exhausted by the delivery of one speech. abuses to be denounced. inhumanities to be condemned. And in such a contest between an employer and its laborer. As above intimated. the exercise and enjoyment of which must not be nullified by mere procedural rule promulgated by the Court Industrial Relations exercising a purely delegate legislative power. 16). the latter eventually loses because he cannot employ the best an dedicated counsel who can defend his interest with the required diligence and zeal. Otherwise these guarantees in the Bill of Rights would be vitiated by rule on procedure prescribing the period for appeal. There is no time limit to the exercise of the freedoms. bereft as he is of the financial resources with which to pay for competent legal services. these rules .

Such a Court of Industrial Relations rule as applied in this case does not implement or reinforce or strengthen the constitutional rights affected. does the inadvertent omission to comply with a mere Court of Industrial Relations procedural rule governing the period for filing a motion for reconsideration or appeal in labor cases. but also does violence to natural reason and logic. Said Court of . 1969. To accord supremacy to the foregoing rules of the Court of Industrial Relations over basic human rights sheltered by the Constitution. The dominance and superiority of the constitutional right over the aforesaid Court of Industrial Relations procedural rule of necessity should be affirmed.' but instead constrict the same to the point of nullifying the enjoyment thereof by the petitioning employees. 1969. is not only incompatible with the basic tenet of constitutional government that the Constitution is superior to any statute or subordinate rules and regulations. 29 The motion for reconsideration was filed on September 29. 1969 or two (2) days late.of procedure were promulgated by the Court of Industrial Relations pursuant to a legislative delegation. but it was a Sunday. promulgated pursuant to a legislative delegation. or seven (7) days from notice on September 22. 1969 of the order dated September 15. prevail over constitutional rights? The answer should be obvious in the light of the aforecited cases. Petitioners claim that they could have filed it on September 28. Does the mere fact that the motion for reconsideration was filed two (2) days late defeat the rights of the petitioning employees? Or more directly and concretely.

especially for the aggrieved workers. Sec. 7073. Sec. It should be stressed here that the motion for reconsideration dated September 27." and likewise prays for an extension of ten (10) days within which to file arguments pursuant to Sections 15. 16 and 17 of the Rules of the Court of Industrial Relations (Annex "G". rec. Rule 52. is unreasonable and therefore is beyond the authority granted by the Constitution and the law. evidence and facts adduced during the hearing. long after the 10-day period required for the filing of such supporting arguments counted from the filing of the motion for reconsideration. The delay in the filing of the motion for reconsideration could have been only one day if September 28. although the arguments were actually filed by the herein petitioners on October 14. 10. In case of the Court of Appeals and the Supreme Court. 1969 was not a Sunday. is based on the ground that the order sought to be reconsidered "is not in accordance with law. This fact accentuates the unreasonableness of the Court of Industrial are concerned. 1969 (Annex "I". pp. Rule 56. a period of fifteen (15) days has been fixed for the filing of the motion for re hearing or reconsideration (See. 1. 1969. promulgated as it was pursuant to a mere legislative delegation. 1969 the resolution dated October 9.). A period of five (5) days within which to file a motion for reconsideration is too short. Rule 51. Herein petitioners received only on October 28. 1969 dismissing the motion for reconsideration for being pro forma since it was filed beyond the reglementary period (Annex "J". pp.Industrial Relations rule. Revised Rules of Court). pp. 74-75. 1. who usually do not have the ready funds to meet the necessary expenses therefor. rec.). rec. 57-60.) .

the constitutional rights of free expression. is deemed waived. so that any cause of action or defense not raised in such pleadings. a constitutional issue can be raised any time. However. must likewise yield to the constitutional rights invoked by herein petitioners even before the institution of the unfair labor practice charged against them and in their defense to the said charge. the very lis mota of the case without the resolution of which no final and complete determination of the dispute can be made. . the procedural rule of the Court of Industrial Relations. even for the first time on appeal. free assembly and petition were not involved. It is a procedural rule that generally all causes of action and defenses presently available must be specifically raised in the complaint or answer. the order or decision subject of 29-a reconsideration becomes final and unappealable. if it appears that the determination of the constitutional issue is necessary to a decision of the case. In the instant case. 30 It is thus seen that a procedural rule of Congress or of the Supreme Court gives way to a constitutional right.It is true that We ruled in several cases that where a motion to reconsider is filed out of time. a creature of Congress. But in all these cases. or where the arguments in suppf such motion are filed beyond the 10 day reglementary period provided for by the Court of Industrial Relations rules.

provided that the right of the parties to a full day in court is not substantially impaired. it matters little that the error of the court a quo is of judgment or of jurisdiction. and all the parties have been duly heard. In other words. Justice Barredo in his concurring opinion in Estrada vs. this Court may treat an appeal as a certiorari and vice-versa. 30-c reiterated this principle and added that Under this authority. in any case. enforcement of the basic human freedoms sheltered no less by the organic law. when all the material facts are spread in the records before Us. Sto. whenever the purposes of justice require. Thus. 30-a It is an accepted principle that the Supreme Court has the inherent power to "suspend its own rules or to except a particular case from its operation. in appropriate cases. it cannot be beyond the admit of its authority. Is within the contemplation of this doctrine that as it is perfectly legal and within the power of this Court to strike down in an appeal acts without or in excess of jurisdiction or committed with grave abuse of discretion. We can then and there render the appropriate judgment. Domingo. without further loss of time. to reverse in a certain proceed in any error of judgment of a court a quo which cannot be exactly categorized as a flaw of jurisdiction. If there can be any doubt. is a most compelling reason to deny application of a Court of Industrial Relations rule which impinges on such human rights. this Court is enabled to cove with all situations without concerning itself about procedural niceties that do not square with the need to do justice." 30-b Mr. which I .In the case at bar.

must be according supremacy over the property rights of their employer firm which has been given a full hearing on this case. If We can disregard our own rules when justice requires it. obedience to the Constitution renders more imperative the suspension of a Court of Industrial Relations rule that clash with the human rights sanctioned and shielded with resolution concern by the specific guarantees outlined in the organic law. whose basic human freedoms. 30-d Insistence on the application of the questioned Court industrial Relations rule in this particular case at bar would an unreasoning adherence to "Procedural niceties" which denies justice to the herein laborers. so as to avoid the unnecessary return of this case to the lower court for the sole purpose of pursuing the ordinary course of an appeal. as in the case at bar. on whether or not the errors this Court has found in the decision of the Court of Appeals are short of being jurisdiction nullities or excesses. especially when. It should be stressed that the application in the instant case Section 15 of the Court of Industrial Relations rules relied upon by herein respondent firm is unreasonable and therefore such application becomes unconstitutional as it subverts the human rights of petitioning labor . (Emphasis supplied).do not entertain. including the right to survive. no actual material damage has be demonstrated as having been inflicted on its property rights. this Court would still be on firm legal grounds should it choose to reverse said decision here and now even if such errors can be considered as mere mistakes of judgment or only as faults in the exercise of jurisdiction.

etc.. the C. We emphasized this doctrine which was restated by Mr. the Court shall act according to justice and equity and substantial merits of the case. Under Section 20 of Commonwealth Act No.. etc. Hamilton." On several occasions. vs. We hold that such criterion is not binding upon the Court of Industrial Relations. Justice Barredo. 30-e thus: As to the point that the evidence being offered by the petitioners in the motion for new trial is not "newly discovered. however. 'The Court of Industrial Relations shall adopt its. without regard to technicalities or legal forms and shall not be bound by any . investigation and determination of any question or controversy and in exercising any duties and power under this Act. which enjoins the Court of Industrial Relations to "act according to justice and equity and substantial merits of the case. That in the hearing. al. et. rules or procedure and shall have such other powers as generally pertain to a court of justice: Provided.R." as such term is understood in the rules of procedure for the ordinary courts.union and workers in the light of the peculiar facts and circumstances revealed by the record. charter.I. The suspension of the application of Section 15 of the Court of Industrial Relations rules with reference to the case at is also authorized by Section 20 of Commonwealth Act No.. 103. in the 1970 case of Kapisanan. speaking for the Court. without regard to technicalities or legal forms .. 103.

I. Villamor.R. 46496. Whitaker. 1940. (Alonso v.) For these reasons. v. 1969 was a Sunday. No. who can ill-afford an alert competent lawyer. Manila Trading & Supply Co. instead of September 22.R. C... 1969. . Chua Kiong v. Phil. simply because their counsel — erroneously believing that he received a copy of the decision on September 23. We believe that this provision is ample enough to have enabled the respondent court to consider whether or not its previous ruling that petitioners constitute a minority was founded on fact. 578). 16 Phil. 315. which practically is only one day late considering that September 28. 17. Feb. . (emphasis supplied. without regard to the technical meaning of newly discovered evidence. 1969 .filed his motion for reconsideration September 29. Labor.' By this provision the industrial court is disengaged from the rigidity of the technicalities applicable to ordinary courts. 71 Phil. Said court is not even restricted to the specific relief demanded by the parties but may issue such orders as may be deemed necessary or expedient for the purpose of settling the dispute or dispelling any doubts that may give rise to future disputes.) To apply Section 15 of the Court of Industrial Relations rules with "pedantic rigor" in the instant case is to rule in effect that the poor workers.. (Ang Tibay v. can no longer seek the sanctuary of human freedoms secured to them by the fundamental law. 124.technical rules of legal evidence but may inform its mind in such manner as it may deem just and equitable. 46 Phil. G. 1969.

161 [1958]). speaking for a unanimous Court in Palma vs. 14243.Many a time. to "a sacrifice of substantial rights of a litigant in altar of sophisticated technicalities with impairment of the sacred principles of justice. 315 [1910]. Court of Appeals. 84 Phil." (Potenciano v.). when it deserts its proper-office as an aid to justice and becomes its great hindrance and chief enemy. 30-f Stated: As was so aptly expressed by Justice Moreland in Alonso v. The Villamor decision was cited with approval in Register of Deeds v. 2 SCRA 675. 600 [1949]. deserves scant consideration from courts. Caltex. Phil. . Bernabe. decided as far back as 1910. p. 104 Phil." (Ibid. 322. "technicality. for the attainment of which such rules have been devised. Mr.128). For him the interpretation of procedural rule should never "sacrifice the ends justice. Aug. The late Justice Recto in Blanco v. 'they were adopted not as ends themselves for the compliance with which courts have organized and function.. p. Justice Fernando. 5 SCRA 1016. Court of Appeals. in the highly rhetorical language Justice Felix.. As succinctly put by Justice Makalintal. L-15379.. they "should give way to the realities of the situation. 1961. 124 [1936]) was of a similar mind. Summarizing the jurisprudence on this score. Oreta. We have remained steadfastly opposed. this Court deviated from procedure technicalities when they ceased to be instruments of justice. but as means conducive to the realization the administration of the law and of justice (Ibid. (63 Phil. this Court has remained committed. Nat." While "procedural laws are no other than technicalities" view them in their entirety. 156. Bank.) To that norm." (Urbayan v. 1962. June 30. 156 [1958] and Uy v. 31. Potenciano v. Uy. 104 Phil. Villamor (16 Phil.

" (Ibid. (1968. technical sense". the Union members who are not officers. the dismissal or termination of the employment of the petitioning eight (8) leaders of the Union is harsh for a one-day absence from work. if not all. (Udan v. 1961. then many. 27. 20. upon the intercession of the Secretary of Labor. Annexes "A". rec. Manotok.). p. 20-30. Amon. 3 SCRA 272.. 843) . If that were so. of the morning and regular shifts reported for work on March 4. L-14968. Counsel for respondent firm insinuates that not all the 400 or so employee participated in the demonstration. were not dismissed and only the Union itself and its thirteen (13) officers were specifically named as respondents in the unfair labor practice charge filed against them by the firm (pp. In the latest decision in point promulgated in 1968. . "B" and "C". Oct. 30-g Even if the questioned Court of Industrial Relations orders and rule were to be given effect. 16-20. as a consequence. respondent's Brief. 1969 and that. The respondent Court itself recognized the severity of such a sanction when it did not include the dismissal of the other 393 employees who are members of the same Union and who participated in the demonstration against the Pasig police. As a matter of fact. 23 SCRA citing McEntee v.. but are intended "to help secure substantial justice. respondent's brief). pp..1019). for which reason only the Union and its thirteen (13) officers were specifically named in the unfair labor practice charge (p. the firm continued in operation that day and did not sustain any damage.) Justice Zaldivar was partial to an earlier formulation of Justice Labrador that rules of procedure "are not to be applied in a very rigid.

while at the same time strengthening the oppressive hand of the petty tyrants in the localities.The appropriate penalty — if it deserves any penalty at all — should have been simply to charge said one-day absence against their vacation or sick leave. A suppression of liberty has the same effect whether the suppress or be a reformer or an outlaw. The Motives of these men are often commendable. but from men of goodwill — good men who allow their proper concerns to blind them to the fact that what they propose to accomplish involves an impairment of liberty.. .. Each surrender of liberty to the demands of the moment makes easier . What we must remember. Justice Douglas articulated this pointed reminder: The challenge to our liberties comes frequently not from those who consciously seek to destroy our system of Government. however. is that preservation of liberties does not depend on motives. But to dismiss the eight (8) leaders of the petitioner Union is a most cruel penalty. since as aforestated the Union leaders depend on their wages for their daily sustenance as well as that of their respective families aside from the fact that it is a lethal blow to unionism. The only protection against misguided zeal is a constant alertness of the infractions of the guarantees of liberty contained in our Constitution. Mr.

. but a complete lack of sympathetic understanding of the plight of its laborers who claim that they are being subjected to indignities by the local police. Such opportunism and expediency resorted to by the respondent company assaulted the . In short. .. larger surrender.. we must recognize that our Bill of Rights is a code of fair play for the less fortunate that we in all honor and good conscience must be observe.another. The battle over the Bill of Rights is a never ending one. But even if we should sense no danger to our own liberties. . even if we feel secure because we belong to a group that is important and respected. The liberties of any person are the liberties of all of us... 31 The case at bar is worse. Management has shown not only lack of good-will or good intention.. the Liberties of none are safe unless the liberties of all are protected. It was more expedient for the firm to conserve its income or profits than to assist its employees in their fight for their freedoms and security against alleged petty tyrannies of local police officers.. This is sheer opportunism.

R. (Annot. 6 A. We ruled: It will avail the Bank none to gloat over this admission of the respondents.I.R. the joining in protests or demands. nepotism in the appointment and favoritism as well as discrimination in the promotion of bank employees. It is not necessary that union activity be involved or that collective bargaining be contemplated. thru Mr. Justice Castro. 2d 416 [1949]). is a concerted activity protected by the Industrial Peace Act. if in furtherance of their interests as such. Assuming that the latter acted in their individual capacities when they wrote the letter-charge they were nonetheless protected for they were engaged in concerted activity.) This is the view of some members of this Court. 32 where the petitioner Bank dismissed eight (8) employees for having written and published "a patently libelous letter . in the exercise of their right of self organization that includes concerted activity for mutual aid and protection. as has been aptly stated..L. C.. if not greed.. It was pure and implement selfishness. For.immunities and welfare of its employees.." Therein. xxx xxx xxx .. Of happy relevance is the 1967 case of Republic Savings Bank vs. even by a small group of employees.. to the Bank president demanding his resignation on the grounds of immorality. (Section 3 of the Industrial Peace Act .

To be sure. v. this Court is in unanimity that the Bank's conduct. xxx xxx xxx In the final sum and substance.S. constituted an unfair labor practice within the . April 29. NLRB 313 U.S. Educ. 177 [1941]). L-13773.. NLRB 324 U. xxx xxx xxx The Bank defends its action by invoking its right to discipline for what it calls the respondents' libel in giving undue publicity to their letter-charge. the right of self-organization of employees is not unlimited (Republic Aviation Corp. the Bank should have allowed the respondents to air their grievances. 1960) is undenied. v. identified as an interference with the employees' right of self-organization or as a retaliatory action. and/or as a refusal to bargain collectively. 793 [1945]).Instead of stifling criticism. as the right of the employer to discharge for cause (Philippine Education Co. Employees. vs. It is directed solely against the abuse of that right by interfering with the countervailing right of self organization (Phelps Dodge Corp. Union of Phil. The Industrial Peace Act does not touch the normal exercise of the right of the employer to select his employees or to discharge them..

. supra. and (2) directing the re instatement of the herein eight (8) petitioners. (Emphasis supplied. where the mass demonstration was not against the company nor any of its officers. minus one day's pay and whatever earnings they might have realized from other sources during their separation from the service. such recognition and protection for free speech. with full back pay from the date of their separation from the service until re instated. judgement is hereby rendered: (1) setting aside as null and void the orders of the respondent Court of Industrial Relations dated September 15 and October 9. With costs against private respondent Philippine Blooming Company. free assembly and right to petition are rendered all the more justifiable and more imperative in the case at bar.meaning and intendment of section 4(a) of the Industrial Peace Act.) 33 If free expression was accorded recognition and protection to fortify labor unionism in the Republic Savings case. Inc. where the complaint assailed the morality and integrity of the bank president no less. 1969. WHEREFORE.

Ermita. Article IV in relation to Section 4. Article 1 of Republic Act 6425. otherwise known as the Dangerous Drugs Act. accused-appellant.. Manila. Branch XLIX) convicting accusedappellant of violation of Section 21 (b). Shirley Reyes.G. ANDRE MARTI. as amended. The facts as summarized in the brief of the prosecution are as follows: On August 14.m. carrying with them four (4) gift wrapped packages. between 10:00 and 11:00 a. No. Article 11 and Section 2 (e) (i). This is an appeal from a decision * rendered by the Special Criminal Court of Manila (Regional Trial Court. 1991 PEOPLE OF THE PHILIPPINES.R. 81561 January 18. plaintiff-appellee vs. 1987. went to the booth of the "Manila Packing and Export Forwarders" in the Pistang Pilipino Complex. The appellant informed Anita Reyes that he . the appellant and his common-law wife. Anita Reyes (the proprietress and no relation to Shirley Reyes) attended to them.

Emphasis supplied). "WALTER FIERZ. p. Styro-foam was placed at the bottom and on top of the packages before the box was sealed with masking tape. however. Appellant. The four (4) packages were then placed inside a brown corrugated box one by two feet in size (1' x 2'). the date of shipment and the name and address of the consignee. p. . When he opened appellant's box. thus making the box ready for shipment (Decision. pp. he squeezed one of the bundles allegedly containing gloves and felt dried leaves inside. passport number.was sending the packages to a friend in Zurich. namely. He made an opening on one of the cellophane wrappers and took several grams of the contents thereof (tsn. Switzerland" (Decision. His curiousity aroused. opened the boxes for final inspection. Switzerland. cigars. 8052 Zurich. and gloves and were gifts to his friend in Zurich. Job Reyes (proprietor) and husband of Anita (Reyes). refused. he pulled out a cellophane wrapper protruding from the opening of one of the gloves. Opening one of the bundles. Mattacketr II. 29-30. 8). Appellant filled up the contract necessary for the transaction. assuring her that the packages simply contained books. a peculiar odor emitted therefrom. writing therein his name. Mr. 6) Anita Reyes then asked the appellant if she could examine and inspect the packages. 1987. In view of appellant's representation. October 6. Before delivery of appellant's box to the Bureau of Customs and/or Bureau of Posts. Anita Reyes no longer insisted on inspecting the packages. following standard operating procedure.

October 6. 38. 30. Therefore. October 6. It turned out that dried . opened the top flaps. Job Reyes and three (3) NBI agents. Job Reyes informed the NBI that the rest of the shipment was still in his office.Job Reyes forthwith prepared a letter reporting the shipment to the NBI and requesting a laboratory examination of the samples he extracted from the cellophane wrapper (tsn. went to the Reyes' office at Ermita. removed the styro-foam and took out the cellophane wrappers from inside the gloves. p. He discovered that the package contained bricks or cake-like dried marijuana leaves. 1987. pp. 1987. 5-6. Manila (tsn. He was interviewed by the Chief of Narcotics Section. The package which allegedly contained books was likewise opened by Job Reyes. i. and a photographer. 1987). Job Reyes brought out the box in which appellant's packages were placed and. August 14. p. He brought the letter and a sample of appellant's shipment to the Narcotics Section of the National Bureau of Investigation (NBI). The package which allegedly contained tabacalera cigars was also opened. in the presence of the NBI agents. at about 1:30 o'clock in the afternoon of that date. Emphasis supplied). October 6..e. Dried marijuana leaves were found to have been contained inside the cellophane wrappers (tsn. 1987).

On the same day the Narcotics Section of the NBI submitted the dried leaves to the Forensic Chemistry Section for laboratory examination. 1987). . pp. Thereafter. The NBI agents made an inventory and took charge of the box and of the contents thereof. 2-3. the NBI agents tried to locate appellant but to no avail. 132-134). otherwise known as the Dangerous Drugs Act. pp. Thereupon. It turned out that the dried leaves were marijuana flowering tops as certified by the forensic chemist. was invited by the NBI to shed light on the attempted shipment of the seized dried leaves. after signing a "Receipt" acknowledging custody of the said effects (tsn. while claiming his mail at the Central Post Office. 1987). 1987. On August 27. October 6. pp. Rollo.marijuana leaves were neatly stocked underneath the cigars (tsn. 39. appellant. After trial. the court a quo rendered the assailed decision. an Information was filed against appellant for violation of RA 6425. Appellant's stated address in his passport being the Manila Central Post Office. October 7. the agents requested assistance from the latter's Chief Security. p. 9-11. (Appellee's Brief.

3 (2).In this appeal. Art. 1. 2 and 3. 55) 1. Appellant contends that the evidence subject of the imputed offense had been obtained in violation of his constitutional rights against unreasonable search and seizure and privacy of communication (Sec. III). THE LOWER COURT ERRED IN NOT GIVING CREDENCE TO THE EXPLANATION OF THE APPELLANT ON HOW THE FOUR PARCELS CAME INTO HIS POSSESSION (Appellant's Brief. Sections 2 and 3. to wit: THE LOWER COURT ERRED IN ADMITTING IN EVIDENCE THE ILLEGALLY SEARCHED AND SEIZED OBJECTS CONTAINED IN THE FOUR PARCELS. Rollo. Art. p. Article III of the Constitution provide: . THE LOWER COURT ERRED IN CONVICTING APPELLANT DESPITE THE UNDISPUTED FACT THAT HIS RIGHTS UNDER THE CONSTITUTION WHILE UNDER CUSTODIAL PROCEEDINGS WERE NOT OBSERVED. p. Constitution) and therefore argues that the same should be held inadmissible in evidence (Sec. III. accused/appellant assigns the following errors.

The right of the people to be secure in their persons. and .Sec. Our present constitutional provision on the guarantee against unreasonable search and seizure had its origin in the 1935 Charter which. houses. 2. 3. houses. or when public safety or order requires otherwise as prescribed by law. papers and effects against unreasonable searches and seizures shall not be violated. (2) Any evidence obtained in violation of this or the preceding section shall be inadmissible for any purpose in any proceeding. papers and effects against unreasonable searches and seizures of whatever nature and for any purpose shall be inviolable. and particularly describing the place to be searched and the persons or things to be seized. (1) The privacy of communication and correspondence shall be inviolable except upon lawful order of the court. to be determined by the judge after examination under oath or affirmation of the complainant and the witnesses he may produce. Sec. and no warrants shall issue but upon probable cause. and no search warrant or warrant of arrest shall issue except upon probable cause to be determined personally by the judge after examination under oath or affirmation of the complainant and the witnesses he may produce. worded as follows: The right of the people to be secure in their persons.

4 [2]. The 1973 Charter (Sec. IV) constitutionalized the Stonehill ruling and is carried over up to the present with the advent of the 1987 Constitution. . Art. People's Court (80 Phil. Ponce de Leon. 1081 [1961]). v. 81 S. (Bache & Co. (Phil. People v. Lim v. 37 SCRA 823 [1971]. 1 [3]. declared as inadmissible any evidence obtained by virtue of a defective search and seizure warrant.. the Court strictly adhered to the exclusionary rule and has struck down the admissibility of evidence obtained in violation of the constitutional safeguard against unreasonable searches and seizures. Thus. Burgos. (Sec.). following the exclusionary rule laid down in Mapp v.particularly describing the place to be searched.Ct. Ruiz. in Stonehill v. 1684. Ohio by the US Federal Supreme Court (367 US 643. 66 SCRA 299 [1975]. Diokno (20 SCRA 383 [1967]).. the Court may turn to the pronouncements of the United States Federal Supreme Court and State Appellate Courts which are considered doctrinal in this jurisdiction. this Court. In a number of cases. As such.Ed. and the persons or things to be seized. 1 [1948]) wherein the admissibility of evidence was not affected by the illegality of its seizure. Inc. abandoning in the process the ruling earlier adopted in Moncado v. Article III) was in turn derived almost verbatim from the Fourth Amendment ** to the United States Constitution. 6 L.

be invoked against the State? We hold in the negative. the evidence so obtained were invariably procured by the State acting through the medium of its law enforcers or other authorized government agencies. It must be noted. allegedly in violation of appellant's constitutional rights. however. may an act of a private individual. In the absence of governmental interference.144 SCRA 1 [1986]. Gonzales. that in all those cases adverted to. GR No. Achacoso. Hon. On the other hand. acting in a private capacity and without the intervention and participation of State authorities. Querubin (48 SCRA 345 [1972]: . 81510. See also Salazar v. Roan v. the liberties guaranteed by the Constitution cannot be invoked against the State. 145 SCRA 687 [1987]. the case at bar assumes a peculiar character since the evidence sought to be excluded was primarily discovered and obtained by a private person. As this Court held in Villanueva v. 1990). March 14. can accused/appellant validly claim that his constitutional right against unreasonable searches and seizure has been violated? Stated otherwise.. Under the circumstances. et al.

United States. . the Court there in construing the right against unreasonable searches and seizures declared that: (t)he Fourth Amendment gives protection against unlawful searches and seizures. California. Schermerber v.Ed.1. There the state. which is called upon to refrain from any invasion of his dwelling and to respect the privacies of his life. as against such authority it was the purpose of the Fourth Amendment to secure the citizen in the right of unmolested . . Its origin and history clearly show that it was intended as a restraint upon the activities of sovereign authority. This constitutional right (against unreasonable search and seizure) refers to the immunity of one's person. Emphasis supplied). from interference by government. 41 S Ct. and as shown in previous cases. . however humble. . 547. McDowell (256 US 465 (1921). . In Burdeau v. and was not intended to be a limitation upon other than governmental agencies. however powerful. whether citizen or alien. . . for in the traditional formulation. his papers. and other possessions. Thus is outlawed any unwarranted intrusion by government. . 1048). (Cf. 65 L. included in which is his residence. does not as such have the access except under the circumstances above noted. is his castle. . its protection applies to governmental action. 384 US 757 [1966] and Boyd v. his house. 116 US 616 [1886].

Or. The Court there said: The search of which appellant complains. not upon private individuals (citing People v. he became suspicious. The search was made on the motel owner's own initiative.. Mo.2d 121). US (373 F. Bryan (457 P. State v. 391 S.2d 938 (1957). 49 Cap. 240 Cal.2d 621. App. subject to the right of seizure by process duly served. was declared admissible in prosecution for illegal possession of narcotics. Brown.W. 317 P. Because of it. was made by a private citizen — the owner of a motel in which appellant stayed overnight and in which he left behind a travel case containing the evidence*** complained of.2d 661 [1968]) where a parking attendant who searched the automobile to ascertain the owner thereof found marijuana instead. called the . The above ruling was reiterated in State v.occupation of his dwelling and the possession of his property. State (429 S. And again in the 1969 case of Walker v.W.2d 903 (1965).2d 517 (1967). 892 (1966). State v. Olsen. Rptr. without the knowledge and participation of police authorities. Potter. however. Likewise appropos is the case of Bernas v. it was held that the search and seizure clauses are restraints upon the government and its agents..

or the lack of it. Records of the case clearly . the factual considerations of the case at bar readily foreclose the proposition that NBI agents conducted an illegal search and seizure of the prohibited merchandise. First. The postulate advanced by accused/appellant needs to be clarified in two days. The fourth amendment and the case law applying it do not require exclusion of evidence obtained through a search by a private citizen. the Court sees no cogent reason why the same should not be admitted against him in the prosecution of the offense charged. the amendment only proscribes governmental action. informed them of the bag's contents. and made it available to the authorities. the argument stands to fall on its own weight.local police. In both instances. Appellant." The contraband in the case at bar having come into possession of the Government without the latter transgressing appellant's rights against unreasonable search and seizure. however. would like this court to believe that NBI agents made an illegal search and seizure of the evidence later on used in prosecuting the case which resulted in his conviction. Rather.

726 [1963]. there is not the search that is prohibited by the constitution (US v. much less an illegal one. contrary to the postulate of accused/appellant. Ker v. 71 L. . Having observed that which is open. 1987. Said inspection was reasonable and a standard operating procedure on the part of Mr. State of California 374 US 23. 429 SW2d 135). he took samples of the same to the NBI and later summoned the agents to his place of business. 15-18. the proprietor of the forwarding agency. 119-122. Lee 274 US 559. 1202 [1927]. is not search (Chadwick v. Original Records. pp. Clearly.Ed. 429 SW2d 122 [1968]). pp. Second.indicate that it was Mr. Moore v. October 6 & 7. Merely to observe and look at that which is in plain sight is not a search. the NBI agents made no search and seizure.Ed. It will be recalled that after Reyes opened the box containing the illicit cargo. who made search/inspection of the packages. Job Reyes. Thereafter. 167-168). pp. Where the contraband articles are identified without a trespass on the part of the arresting officer. the mere presence of the NBI agents did not convert the reasonable search effected by Reyes into a warrantless search and seizure proscribed by the Constitution. State. 10 L. 7-8. Reyes as a precautionary measure before delivery of packages to the Bureau of Customs or the Bureau of Posts (TSN.2d. where no trespass has been committed in aid thereof. State. he opened the parcel containing the rest of the shipment and entrusted the care and custody thereof to the NBI agents.

The Bill of Rights governs the relationship between the individual and the state. But protection against whom? Commissioner Bernas in his sponsorship speech in the Bill of Rights answers the query which he himself posed. Its concern is not the relation between individuals. July 17. Protection against whom? Protection against the state. 1. True. the liberties guaranteed by the fundamental law of the land must always be subject to protection. the general reflections. What the Bill of Rights does is to declare some forbidden zones in the private sphere inaccessible to any power holder. it was likewise held that where the property was taken into custody of the police at the specific request of the manager and where the search was initially made by the owner there is no unreasonable search and seizure within the constitutional meaning of the term. That the Bill of Rights embodied in the Constitution is not meant to be invoked against acts of private individuals finds support in the deliberations of the Constitutional Commission. Watkins (237 F. as follows: First. Record of the Constitutional Commission.In Gandy v. p. Supp. Vol. 266 [1964]). (Sponsorship Speech of Commissioner Bernas . between a private individual and other individuals. 1986. The protection of fundamental liberties in the essence of constitutional democracy. Emphasis supplied) . 674.

62). expressly declaring as inadmissible any evidence obtained in violation of the constitutional prohibition against illegal search and seizure.The constitutional proscription against unlawful searches and seizures therefore applies as a restraint directed only against the government and its agencies tasked with the enforcement of the law. it matters not whether the evidence was procured by police authorities or private individuals (Appellant's Brief. . p. if the search is made at the behest or initiative of the proprietor of a private establishment for its own and private purposes. and without the intervention of police authorities. However. not the law enforcers. a warrant must generally be first secured if it is to pass the test of constitutionality. Rollo. that since the provisions of the 1935 Constitution has been modified by the present phraseology found in the 1987 Charter. In sum. however. the right against unreasonable search and seizure cannot be invoked for only the act of private individual. 8. as in the case at bar. is involved. the protection against unreasonable searches and seizures cannot be extended to acts committed by private individuals so as to bring it within the ambit of alleged unlawful intrusion by the government. Thus. Appellant argues. p. If the search is made upon the request of law enforcers. it could only be invoked against the State to whom the restraint against arbitrary and unreasonable exercise of power is imposed.

Art.The argument is untenable. 167 SCRA 393 [1988]. it must be emphasized that the modifications introduced in the 1987 Constitution (re: Sec. 13 [October 1. The restraint stayed with the State and did not shift to anyone else. the admissibility of the evidence procured by an individual effected through private seizure equally applies. Moreover. 12 [June 30. the constitution. III) relate to the issuance of either a search warrant or warrant of arrest vis-a-vis the responsibility of the judge in the issuance thereof (See Soliven v. For one thing. in pari passu. alleged violations against unreasonable search and seizure may only be invoked against the State by an individual unjustly traduced by the exercise of sovereign authority. To agree with appellant that an act of a private individual in violation of the Bill of Rights should also be construed as an act of the State would result in serious legal complications and an absurd interpretation of the constitution. 1985] and Circular No. to the alleged violation. 2. 1987]. Circular No. . of appellant's constitutional rights to privacy and communication. The modifications introduced deviate in no manner as to whom the restriction or inhibition against unreasonable search and seizure is directed against. does not govern relationships between individuals. Makasiar. Similarly. Corolarilly. in laying down the principles of the government and fundamental liberties of the people. non-governmental as it is.

5(m). We have carefully examined the records of the case and found nothing to indicate. It is presumed that they have regularly performed their duties (See. that appellant was not informed of his constitutional rights or that he gave statements without the assistance of counsel. In his second assignment of error. appellant contends that the lower court erred in convicting him despite the undisputed fact that his rights under the constitution while under custodial investigation were not observed. on the other hand. Again. and Mrs. The law enforcers testified that accused/appellant was informed of his constitutional rights. did you investigate the accused together with the girl? WITNESS: . Job Reyes. as an "undisputed fact". Lastimoso of the NBI. Thus: Fiscal Formoso: You said that you investigated Mr. there being no evidence to the contrary. What is clear from the records.2. What about the accused here. Rule 131) and their testimonies should be given full faith and credence. the contention is without merit. is that appellant refused to give any written statement while under investigation as testified by Atty.

2-10). whom appellant met in a pub along Ermita. What is more. . Michael requested him to ship the packages and gave him P2. 1987.00 for the cost of the shipment since the German national was about to leave the country the next day (October 15.000.Yes. Appellant's second assignment of error is therefore misplaced. p. Original Records. 240) The above testimony of the witness for the prosecution was not contradicted by the defense on cross-examination. appellant would like us to believe that he was not the owner of the packages which contained prohibited drugs but rather a certain Michael. we have examined the assailed judgment of the trial court and nowhere is there any reference made to the testimony of appellant while under custodial investigation which was utilized in the finding of conviction. Manila: that in the course of their 30-minute conversation. Coming now to appellant's third assignment of error. a German national. 1987. we have interviewed the accused together with the girl but the accused availed of his constitutional right not to give any written statement. pp. p. October 8. neither was there any proof by the defense that appellant gave uncounselled confession while being investigated. (TSN. As borne out by the records. TSN. sir. 62. 3.

p. As stated by the trial court.00 for the purpose and for appellant to readily accede to comply with the undertaking without first ascertaining its contents. p. would not simply accept such undertaking to take custody of the packages and ship the same from a complete stranger on his mere say-so" (Decision. p. 21. An acquaintance with a complete stranger struck in half an hour could not have pushed a man to entrust the shipment of four (4) parcels and shell out P2. 171 SCRA 571 [1989]. we find appellant's disclaimer as incredulous. 174 SCRA 237 [1989]). As to why he readily agreed to do the errand. . self-serving and contrary to human experience. p. p. 19. Original Records. It can easily be fabricated. 1987. Decision. Denials. p. 244. Sariol. Appellant's bare denial is even made more suspect considering that. "(a) person would not simply entrust contraband and of considerable value at that as the marijuana flowering tops. 66. 91).000. Walter Fierz. also a Swiss national. as per records of the Interpol. was likewise convicted for drug abuse and is just about an hour's drive from appellant's residence in Zurich. appellant failed to explain. if unsubstantiated by clear and convincing evidence. Rollo.Rather than give the appearance of veracity. Rollo.000. are negative self-serving evidence which deserve no weight in law and cannot be given greater evidentiary weight than the testimony of credible witnesses who testify on affirmative matters (People v. October 8. The Accused. he was previously convicted of possession of hashish by the Kleve Court in the Federal Republic of Germany on January 1. 1982 and that the consignee of the frustrated shipment. Esquillo. Switzerland (TSN. People vs. on the other hand. 93).00 to a complete stranger like the Accused. and the cash amount of P2.

172 SCRA 651 [1989]. must not only proceed from the mouth of a credible witness. appellant should have so indicated in the contract of shipment (Exh.Evidence to be believed. the judgment of conviction finding appellant guilty beyond reasonable doubt of the crime charged is hereby AFFIRMED. his complete address or passport number. see also People v. On the contrary. appellant is therefore estopped to claim otherwise. we see no error committed by the trial court in rendering the assailed judgment. At this point. 26 SCRA 342 [1968]. Premises considered. Sarda. or exercises acts of ownership over. 130. p. 40). Sunga. are owned by him (Sec. Original Records. 5 [j]. CA. 37 N. No costs.J. . WHEREFORE. As records further show. "B". People v. citing Daggers v. 123 SCRA 327 [1983]). Castañares v. Eg. Rule 131). Van Dyke. the German national was the owner of the merchandise. appellant signed the contract as the owner and shipper thereof giving more weight to the presumption that things which a person possesses. Furthermore. appellant did not even bother to ask Michael's full name. if indeed. 92 SCRA 567 [1979]). Alto. but it must be credible in itself such as the common experience and observation of mankind can approve as probable under the circumstances (People v.

NATIONAL LABOR RELATIONS COMMISSION and ANTONIA MELODIA CATOLICO. petitioners. 1997] WATEROUS DRUG CORPORATION and MS. No. J. DECISION DAVIDE. 113271. respondents.”*1+ This petition for certiorari under Rule 65 of the Rules of Court seeks to declare private respondent Antonia Melodia Catolico (hereafter Catolico) not a “true Servant. . EMMA CO.” thereby assailing the 30 September 1993 decision[2] and 2 December 1993 Resolution[3] of the National Labor Relations Commission (NLRC) in NLRC-NCR CA No. 005160-93.R.: “Nor is he a true Servant *who+ buys dear to share in the Profit with the Seller. October 16. JR. vs.FIRST DIVISION [G.

Catolico did not deny her responsibility but explained that her act was “due to negligence. Catolico received a memorandum[6] from WATEROUS Vice President-General Manager Emma R.” since fellow employee Irene Soliven “obtained the medicines in bad faith and through misrepresentation when she claimed that she was given a charge slip by the Admitting Dept. Co warning her not to dispense medicine to employees chargeable to the latter’s accounts because the same was a prohibited practice. Co issued another memorandum[7] to Catolico warning her not to negotiate with suppliers of medicine without consulting the Purchasing Department. besides she was not authorized to deal directly with the suppliers.[5] The facts are as follows: Catolico was hired as a pharmacist by petitioner Waterous Drug Corporation (hereafter WATEROUS) on 15 August 1988.[8] . as this would impair the company’s control of purchases and. As regards the first memorandum.” Catolico then asked the company to look into the fraudulent activities of Soliven.which sustained the reinstatement and monetary awards in favor of private respondent*4+ and denied the petitioners’ motion for reconsideration. On 31 July 1989. On the same date.

. WATEROUS Control Clerk Eugenio Valdez informed Co that he noticed an irregularity involving Catolico and Yung Shin Pharmaceuticals.840. YSP.O. 266 representing purchase of ten (10) bottles of Voren tablets at P384. WDRC paid the amount of P3. Accounting Department (Ms. 19045 is priced at P384. Inc. Catolico through China Bank check no. which was paid to Ms.00). Inc. 222832 dated December 15.O. No.In a memorandum[9] dated 21 November 1989.s issued to YSP.00 or an over price of P64.) No. WATEROUS Supervisor Luzviminda E.00 thru MBTC Check No. . Verification was made to YSP. Estelita Reyes) confirmed that the difference represents refund of jack-up price of ten bottles of Voren tablets per sales invoice no.00 while P. 266 as per their check voucher no. 19045 with YSP Sales Invoice No. Inc. 1989. 892068 dated November 9. Bautro warned Catolico against the “rush delivery of medicines without the proper documents. 629552 (shown to the undersigned). showed that the price per bottle is P320.” On 29 January 1990. Previous P.00 per bottle (or total of P640. 1988. Inc. (hereafter YSP)..O. to determine the discrepancy and it was found that the cost per bottle was indeed overpriced.. which he described as follows: … A case in point is medicine purchased under our Purchase Order (P.00 per unit.

Ms. bukas. Catolico even asked Ms. Catolico. she confirmed that the check amounting to P640. However. she was informed that effective 6 February 1990 to 7 March 1990. on 2 February 1990. Saldana if she opened the envelope containing the check but Ms.00) had been pocketed by Ms.[10] Forthwith. Catolico. upon conversation with Ms.[12] and she was granted a 48-hour extension from 1 to 3 February 1990. Catolico asked for additional time to give her explanation.[14] In a letter[15] to Co dated 10 February 1990. explained that the check she received from YSP was a . EDRC Espana Pharmacy Clerk. Catolico requested access to the file containing Sales Invoice No. 266 for her to be able to make a satisfactory explanation.” It appears that the amount in question (P640. Saldana. Co asked Catolico to explain.00 was actually received by Ms. As a matter of fact. Saldana answered her “talagang ganyan. In said letter she protested Saldaña’s invasion of her privacy when Saldaña opened an envelope addressed to Catolico. However.The undersigned talked to Ms. her side of the reported irregularity. in her memorandum[11] dated 31 January 1990. Catolico. through her counsel. she would be placed on preventive suspension to protect the interests of the company. within twenty-four hours. Catolico regarding the check but she denied having received it and that she is unaware of the overprice.[13] In a letter dated 2 February 1990.

Christmas gift and not a “refund of overprice. WATEROUS Supervisor Luzviminda Bautro. you are hereby terminated effective March 8.00 actually represents the refund of over price of said medicines and this was confirmed by Ms. 2. Inc. YSP Phils.” She also averred that the preventive suspension was ill-motivated. for 10 bottles of Voren tablets at P384.. Your actuation constitutes an act of dishonesty detrimental to the interest of the company. A check which you received in the amount of P640. 1990 and Feb. However. Accordingly. 10. 1990 respectively regarding our imposition of preventive suspension on you for acts of dishonesty. issued a memorandum[16] notifying Catolico of her termination. Estelita Reyes. as it sprang from an earlier incident between her and Co’s secretary.00/bottle with previous price of P320. said letters failed to rebut the evidences [sic] in our possession which clearly shows that as a Pharmacist stationed at Espana Branch. thus: We received your letter of explanation and your lawyer's letter dated Feb. .00/bottle only. 1990. Accounting Department. you actually made Purchase Orders at YSP Phils.. On 5 March 1990. Inc. Irene Soliven.

On 5 May 1990.50 1/12 of P26. Hence. Labor Arbiter Alex Arcadio Lopez found no proof of unfair labor practice against petitioners. and illegal suspension. and the additional sum of P2. He thus declared the dismissal and suspension illegal but disallowed reinstatement. illegal dismissal.858.00 Backwages 26.50 2.[17] In his decision[18] of 10 May 1993. Accordingly.” Arbiter Lopez computed the award in favor of Catolico as follows: 30 days Preventive Suspension P 2.238.21 .858. back wages for one year. Catolico filed before the Office of the Labor Arbiter a complaint for unfair labor practice. Nevertheless. as it would not be to the best interest of the parties.” and to show that any investigation was conducted. he awarded separation pay to Catolico computed at one-half month’s pay for every year of service. he decided in favor of Catolico because petitioners failed to “prove what *they+ alleged as complainant’s dishonesty.000. the dismissal was without just cause and due process.000.00 for illegal suspension “representing 30 days work.

.86 Petitioners seasonably appealed from the decision and urged the NLRC to set it aside because the Labor Arbiter erred in finding that Catolico was denied due process and that there was no just cause to terminate her services. it declared that the check was inadmissible in evidence pursuant to Sections 2 and 3(1 and 2) of Article III of the Constitution. respondents’ case falls apart as it is bereft of evidence which cannot be used as a legal basis for complainant’s dismissal. In its decision[19] of 30 September 1993.401.15 TOTAL AWARD: P35. It found that petitioner’s evidence consisted only of the check of P640. which her coemployee saw when the latter opened the envelope.305.Separation pay (3 years) 4. But. by virtue of the constitutional right invoked by complainants. the NLRC affirmed the findings of the Labor Arbiter on the ground that petitioners were not able to prove a just cause for Catolico’s dismissal from her employment.00 drawn by YSP in favor of complainant.[20] It concluded: With the smoking gun evidence of respondents being rendered inadmissible.

petitioners insist that Catolico had been receiving “commissions” from YSP.” constituted . Article III of the 1987 Constitution. or probably from other suppliers. II. petitioners filed this special civil action for certiorari. Due process was duly accorded to private respondent.86. Public respondent gravely erred in applying Section 3. and that the check issued to her on 9 November 1989 was not the first or the last. but modified the dispositive portion of the appealed decision by deleting the award for illegal suspension as the same was already included in the computation of the aggregate of the awards in the amount of P35. Public respondent committed grave abuse of discretion in its findings of facts. III.401. Their motion for reconsideration having been denied. which is anchored on the following grounds: I. aggravated by her “propensity to violate company rules. As to the first and second grounds. They also maintained that Catolico occupied a confidential position and that Catolico’s receipt of YSP’s check.The NLRC then dismissed the appeal for lack of merit.

Catolico was given ample opportunity to explain her side of the controversy. and concluded that the opportunities granted her and her subsequent explanation “satisfy the requirements of just cause and due process.breach of confidence.[21] the constitutional protection against unreasonable searches and seizures refers to the immunity of one’s person from interference by government and cannot be extended to acts committed by private individuals so as to bring it within the ambit of alleged unlawful intrusion by the government. the OSG echoed petitioners’ argument that there was no violation of the right of privacy of communication in this case. It observed that Catolico was given “several opportunities” to explain her side of the check controversy. and (b) the incident involving the opening of envelope addressed to private respondent does not warrant the application of the constitutional provisions. in light of the decision in the People v. Marti. And contrary to the findings of NLRC. as it was of the persuasion that (a) the conclusions reached by public respondent are inconsistent with its findings of fact.[22] adding that petitioner WATEROUS was justified in opening . constituted substantial evidence of dishonesty. petitioners submit that.” The OSG was also convinced that Catolico’s dismissal was based on just cause and that Catolico’s admission of the existence of the check. as well as her “lame excuse” that it was a Christmas gift from YSP. Finally. Anent the third ground. In its Manifestation in Lieu of Comment. the Office of the Solicitor General (OSG) disagreed with the NLRC's decision.

the NLRC contends that petitioners miserably failed to prove their claim that it committed grave abuse of discretion in its findings of fact. she meant that she did not receive any refund of overprice. Catolico asserts that petitioners’ evidence is too “flimsy” to justify her dismissal. and there is no indication in the contentious check that it was meant as a refund for overpriced medicines. with no basis to conclude that Catolico . It then prays that we dismiss this petition. and she had no duty to turn it over to her employer. hence. Besides. Catolico likewise disputes petitioners’ claim that the audit report and her initial response that she never received a check were sufficient to justify her dismissal. consistent with her position that what she received was a token gift. Company rules do not prohibit an employee from accepting gifts from clients. In its Comment which we required to be filed in view of the adverse stand of the OSG. as correctly held by the NLRC.an envelope from one of its regular suppliers as it could assume that the letter was a business communication in which it had an interest. it was inadmissible in evidence. In her Comment. The check in issue was given to her. All that can be gathered from the audit report is that there was apparently an overcharge. When she denied having received a check from YSP. the check was discovered in violation of the constitutional provision on the right to privacy and communication.

Procedural due process requires that an employee be apprised of the charge against him. allowed ample opportunity to be heard and defend himself.” She was doing the task of a saleslady: selling drugs and making requisitions when supplies were low.pocketed the amount in collusion with YSP. She thus concluded that her dismissal was based on a mere suspicion. she was dismissed from the service in the memorandum of 5 March 1990 issued by her Supervisor after receipt of her letter and that of her counsel. No hearing was ever conducted . the instant petition must fail. she did not handle “confidential information or sensitive properties.[24] In the case at bar. including legal representation. Concededly. Finally. and assisted by a representative if the employee so desires. although Catolico was given an opportunity to explain her side. being merely a pharmacist. except as to the third ground. Catolico was denied due process. A thorough review of the record leads us to no other conclusion than that. Catolico insists that she could not have breached the trust and confidence of WATEROUS because.[23] Ample opportunity connotes every kind of assistance that management must accord the employee to enable him to prepare adequately for his defense. given reasonable time to answer the charge.

however.” which were not. Catolico in violation of the [company] procedure. .[25] Here.00 per bottle of 50 mg. submitted. which has a previous price of only P320. their evidence does not establish that there was an overcharge. only the Supervisor knew. Ms.00. What the “evidences” *sic+ other than the sales invoice and the check were.after the issues were joined through said letters. Control Clerk Eugenio C. WATEROUS proved unequal to the task. Unfortunately for petitioners. stated in his affidavit:[26] 4. My findings revealed that on or before the month of July 31. made an under the table deal with YSP Phils. Valdez. who claims to have discovered Catolico’s inappropriate transaction. and its failure to discharge that burden would result in a finding that the dismissal is unjustified. The Supervisor’s memorandum spoke of “evidences *sic+ in *WATEROUS+ possession. 1989. Catolico was also unjustly dismissed. It is evident from the Supervisor’s memorandum that Catolico was dismissed because of an alleged anomalous transaction with YSP. It is settled that the burden is on the employer to prove just and valid cause for dismissing an employee. to supply WDRC needed medicines like Voren tablets at a jack-up price of P384.

it was never shown that petitioners paid for the Voren tablets.00 “thru MBTC Check No. to determine the discrepancy and I found out that the cost per bottle was indeed overpriced. The Accounting Department of YSP Phils. the two purchase orders for Voren tablets presented by petitioners do not indicate an overcharge. nor was any receipt from YSP offered by petitioners.” the said check was never presented in evidence. that WATEROUS paid YSP P3.5. The purchase order dated 16 August 1989[29] stated that the Voren tablets cost P320. I verified the matter to YSP Phils. 222832. we have to reject the statements attributed to her by Valdez. Moreover. Estelita Reyes confirmed that there was really an overprice and she said that the difference was refunded through their check voucher no. 629552 which was shown to me and the payee is Melodia Catolico.840. While Valdez informed Co. Estelita Reyes never testified nor executed an affidavit relative to this case. It clearly appears then that Catolico’s dismissal was based on hearsay information. through the former’s memorandum[28] of 29 January 1990.00 per box. The difference in price may then be attributed to the different packaging used in each purchase order.00 per bottle. thus.[27] Besides. through Ms. 1989. while the purchase order dated 5 October 1989[30] priced the Voren tablets at P384. 892068 dated November 9. Hearsay evidence carries no probative value. . through a China Bank Check No.

Despite the memorandum warning Catolico not to negotiate with suppliers of medicine. petitioners had no one to blame for their predicament but themselves. whims. Panuncio. to which class of employees the term “trust and confidence” is restricted. Catolico’s dismissal then was obviously grounded on mere suspicion. If the price increase was objectionable to petitioners. There was no occasion for Catolico to initiate. with the said suppliers.[32] Besides. they or their officers should have disapproved the transaction. as the purchase orders indicate. or suspicion. The purchase orders were silent as to Catolico’s participation in the purchase. the two purchase orders for the Voren tablets were recommended by Director-MMG Mario R.[31] and even the dismissal of an employee for loss of trust and confidence must rest on substantial grounds and not on the employer’s arbitrariness. Again. Co.*33+ . Consequently. which in no case can justify an employee’s dismissal. what Valdez called an “under the table deal” with YSP. Catolico was not at all involved in the sale of the Voren tablets. Catolico was not shown to be a managerial employee. Suspicion is not among the valid causes provided by the Labor Code for the termination of employment. caprices. verified by AVP-MNG Noli M. much less benefit from. or that she had the opportunity to transact.Assuming that there was an overcharge. Lopez and approved by Vice President-General Manager Emma R. This set of facts emphasizes the exceedingly incredible situation proposed by petitioners. there was no proof that she ever transacted.

. in NLRC-NCR CA No. that the citizens have no recourse against such assaults. that the evidence against private respondent was inadmissible for having been . as counsel for Catolico claims. It is not true. Labor Arbiter Lopez computed the separation pay at one-half month’s salary for every year of service. WHEREFORE. viz. Catolico did not oppose or raise an objection. except as to its reason for upholding the Labor Arbiter’s decision. respectively. however. we find no reason to revise the doctrine laid down in People vs.As regards the constitutional violation upon which the NLRC anchored its decision. and as said counsel admits. On the contrary. 005160-93 are AFFIRMED. he correctly awarded separation pay to Catolico.[35] In this case. Finally. since it has been determined by the Labor Arbiter that Catolico’s reinstatement would not be to the best interest of the parties. the instant petition is hereby DISMISSED and the challenged decision and resolution of the National Labor Relations Commission dated 30 September 1993 and 2 December 1993. such an invasion gives rise to both criminal and civil liabilities. Marti[34] that the Bill of Rights does not protect citizens from unreasonable searches and seizures perpetrated by private individuals. we will uphold the award of separation pay as fixed by the Labor Arbiter. Separation pay in lieu of reinstatement is computed at one month’s salary for every year of service. As such.

No. [G. INC.: THIS case portrays the peculiar story of an international flight steward who was dismissed because of his failure to adhere to the weight standards of the airline company. PETITIONER. He is now before this Court via a petition for review on certiorari claiming that he was illegally dismissed. Costs against petitioners. R.T. 168081.obtained in violation of her constitutional rights of privacy of communication and against unreasonable searches and seizures which is hereby set aside. VS. PHILIPPINE AIRLINES. To buttress his stance.R. October 17. DECISION REYES.. RESPONDENT.. YRASUEGUI. 2008] ARMANDO G. he argues that (1) his dismissal does not fall under 282(e) of the Labor . J.

1985 to address his weight concerns. Apparently. The weight problem of petitioner dates back to 1984. Yrasuegui was a former international flight steward of Philippine Airlines. Inc. The Facts Petitioner Armando G. He stands five feet and eight inches (5'8") with a large body frame. the ideal weight being 166 pounds. The proper weight for a man of his height and body structure is from 147 to 166 pounds. (PAL). (2) continuing adherence to the weight standards of the company is not a bona fide occupational qualification. Neither is it reflective of his moral character. . however. We uphold the legality of dismissal. Back then. should be awarded in favor of the employee as an act of social justice or based on equity. Separation pay. 1984 to March 4. PAL advised him to go on an extended vacation leave from December 29. and (3) he was discriminated against because other overweight employees were promoted instead of being disciplined. After a meticulous consideration of all arguments pro and con. This is so because his dismissal is not for serious misconduct.Code. as mandated by the Cabin and Crew Administration Manual[1] of PAL.

gaining 2 pounds from his previous weight. 1989. petitioner underwent weight check. he was removed from flight duty effective May 6.petitioner failed to meet the company's weight standards. 1985 to November 1985. 1989. petitioner made a . In line with company policy. petitioner weighed 209 pounds. He was also told that he may avail of the services of the company physician should he wish to do so. 1988 to February 1989. On October 17. Petitioner weighed 217 pounds. After the visit. which is 49 pounds beyond the limit. prompting another leave without pay from March 5. weight.[2] On February 25. Consequently. He was advised that his case will be evaluated on July 3. his off-duty status was retained. 43 pounds over his ideal weight. 1989 to July 3. 1989. petitioner was allowed to return to work. It was discovered that he gained. On April 26. He was overweight at 215 pounds. He was formally requested to trim down to his ideal weight and report for weight checks on several dates. He again went on leave without pay from October 17. PAL Line Administrator Gloria Dizon personally visited petitioner at his residence to check on the progress of his effort to lose weight. 1989. After meeting the required weight. 1989. instead of losing. But petitioner's weight problem recurred.

in full. F/S Armando Yrasuegui[4] Despite the lapse of a ninety-day period given him to reach his ideal weight. he was informed of the PAL decision for him to remain grounded until such . Likewise. petitioner remained overweight. reads: Dear Sir: I would like to guaranty my commitment towards a weight loss from 217 pounds to 200 pounds from today until 31 Dec. The letter. On January 3. I promise to continue reducing at a reasonable percentage until such time that my ideal weight is achieved.commitment[3] to reduce weight in a letter addressed to Cabin Crew Group Manager Augusto Barrios. 1989. 1990. I promise to personally report to your office at the designated time schedule you will set for my weight check. From thereon. Respectfully Yours.

1990. 1990. petitioner was formally warned that a repeated refusal to report for weight check would be dealt with accordingly. petitioner was required to explain his refusal to undergo weight checks. he was still way over his ideal weight of 166 pounds. On June 26. 1990. Clearly.time that he satisfactorily complies with the weight standards. he was given one more month to comply with the weight requirement. On April 17. petitioner failed to report for weight checks. He was reminded that his grounding would continue pending satisfactory compliance with the weight standards.[6] Again. Again. petitioner ignored the directive and did not report for weight checks. although he was seen submitting his passport for processing at the PAL Staff Service Division. he was directed to report every two weeks for weight checks. Despite that. . He was given another set of weight check dates. he weighed at 212 pounds. Petitioner failed to report for weight checks. he was asked to report for weight check on different dates.[7] When petitioner tipped the scale on July 30.[5] Again. As usual.

PAL finally served petitioner a Notice of Administrative Charge for violation of company standards on weight requirements. 1992. if any. What he claimed.[9] Notably. a clarificatory hearing was held where petitioner manifested that he was undergoing a weight reduction program to lose at least two (2) pounds per week so as to attain his ideal weight. petitioner was formally informed by PAL that due to his inability to attain his ideal weight. "and considering the utmost . 1992. 1992. 1992 and 205 pounds on November 5.[10] On June 15. 1993. He was given ten (10) days from receipt of the charge within which to file his answer and submit controverting evidence. 1992. he did not deny being overweight." He also claimed that PAL discriminated against him because "the company has not been fair in treating the cabin crew members who are similarly situated. petitioner submitted his Answer. He weighed at 219 pounds on August 20. On November 13. had already been condoned by PAL since "no action has been taken by the company" regarding his case "since 1988.[8] On December 7. is that his violation.From then on." On December 8. nothing was heard from petitioner until he followed up his case requesting for leniency on the latter part of 1992. instead.

Attorney's fees of five percent (5%) of the total award.000. Labor Arbiter Valentin C. NLRC and CA Dispositions On November 18. 1998. declaring the complainant's dismissal illegal. Labor Arbiter.00 per month from his dismissal on June 15. 1993 up to August 15.leniency" extended to him "which spanned a period covering a total of almost five (5) years. 1993 until reinstated."[11] His motion for reconsideration having been denied." his services were considered terminated "effective immediately. Reyes ruled[13] that petitioner was illegally dismissed.500. 1998 at P651. in view of the foregoing.00. . and to pay him: Backwages of Php10. and ordering the respondent to reinstate him to his former position or substantially equivalent one. which for purposes of appeal is hereby set from June 15.[12] petitioner filed a complaint for illegal dismissal against PAL. judgment is hereby rendered. The dispositive part of the Arbiter ruling runs as follows: WHEREFORE.

[14] The Labor Arbiter held that the weight standards of PAL are reasonable in view of the nature of the job of petitioner.[16] Assuming that it did.[17] Notably. and Mr.[15] However.e.[20] On February 1. PAL appealed the denial of its motion to quash to the NLRC.[23] . the weight standards need not be complied with under pain of dismissal since his weight did not hamper the performance of his duties. Cui. 1999. petitioner could be transferred to other positions where his weight would not be a negative factor. Mr.. were promoted instead of being disciplined. On March 6. 2000. other overweight employees. i. Palacios. the Labor Arbiter denied[21] the Motion to Quash Writ of Execution[22] of PAL.SO ORDERED. Mr.[18] Both parties appealed to the National Labor Relations Commission (NLRC). the Labor Arbiter issued a writ of execution directing the reinstatement of petitioner without loss of seniority rights and other benefits.[19] On October 8. 2000. Barrios.

"[26] As a consequence. Both appeals of respondent thus. there can be no intentional defiance or serious misconduct by petitioner to the lawful order of PAL for him to lose weight.[25] According to the NLRC. 2000. are DISMISSED for utter lack of merit. whether physical or through payroll within ten (10) days from notice failing which.On June 23.[27] . from date of dismissal until his actual reinstatement or finality hereof. Respondent is enjoined to manifests (sic) its choice of the form of the reinstatement of complainant. "obesity. is a disease in itself.] the Decision of the Arbiter dated 18 November 1998 as modified by our findings herein. the same shall be deemed as complainant's reinstatement through payroll and execution in case of non-payment shall accordingly be issued by the Arbiter. inclusive of allowances and to his other benefits or their monetary equivalent instead of simply backwages. is hereby AFFIRMED and that part of the dispositive portion of said decision concerning complainant's entitlement to backwages shall be deemed to refer to complainant's entitlement to his full backwages. the NLRC rendered judgment[24] in the following tenor: WHEREFORE. or the tendency to gain weight uncontrollably regardless of the amount of food intake. premises considered[.

According to the NLRC.[28] PAL moved for reconsideration to no avail. No costs. the NLRC found the weight standards of PAL to be reasonable. premises considered. However. SO ORDERED.[30] By Decision dated August 31.[32] The CA opined that there was grave abuse of discretion on the part of the NLRC because it "looked at wrong and irrelevant considerations"[33] in evaluating the evidence of the parties. it found as unnecessary the Labor Arbiter holding that petitioner was not remiss in the performance of his duties as flight steward despite being overweight. . The private respondent's complaint is hereby DISMISSED.[29] Thus. PAL elevated the matter to the Court of Appeals (CA) via a petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure. we hereby GRANT the petition. the Labor Arbiter should have limited himself to the issue of whether the failure of petitioner to attain his ideal weight constituted willful defiance of the weight standards of PAL.Like the Labor Arbiter. The assailed NLRC decision is declared NULL and VOID and is hereby SET ASIDE. 2004. the CA reversed[31] the NLRC: WHEREFORE.

the weight standards of PAL are meant to be a continuing qualification for an employee's position. petitioner was legally dismissed because he repeatedly failed to meet the prescribed weight standards.[39] It is obvious that the issue of discrimination was only invoked by petitioner for purposes of escaping the result of his dismissal for being overweight. "justifies an employee's separation from the service.[40] On May 10. the CA held that the weight standards of PAL are a bona fide occupational qualification which. the CA denied petitioner's motion for reconsideration."[42] Issues .[34] The failure to adhere to the weight standards is an analogous cause for the dismissal of an employee under Article 282(e) of the Labor Code in relation to Article 282(a).[35] Said the CA."[36] In other words."[37] Just like the Labor Arbiter and the NLRC.[38] Thus.Contrary to the NLRC ruling. 2005. "the relevant question to ask is not one of willfulness but one of reasonableness of the standard and whether or not the employee qualifies or continues to qualify under this standard. in case of violation. It is not willful disobedience as the NLRC seemed to suggest. the CA held that the weight standards of PAL are reasonable. "the element of willfulness that the NLRC decision cites is an irrelevant consideration in arriving at a conclusion on whether the dismissal is legally proper.[41] Elaborating on its earlier ruling.

WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT PETITIONER WAS NOT UNDULY DISCRIMINATED AGAINST WHEN HE WAS DISMISSED WHILE OTHER OVERWEIGHT . WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT PETITIONER'S OBESITY CAN BE A GROUND FOR DISMISSAL UNDER PARAGRAPH (e) OF ARTICLE 282 OF THE LABOR CODE OF THE PHILIPPINES. II. the following issues are posed for resolution: I. III.In this Rule 45 petition for review. WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT PETITIONER'S DISMISSAL FOR OBESITY CAN BE PREDICATED ON THE "BONA FIDE OCCUPATIONAL QUALIFICATION (BFOQ) DEFENSE".

IV. The dismissal of the employee would thus fall under Article 282(e) of the Labor Code. The obesity of petitioner is a ground for dismissal under Article 282(e) [44] of the Labor Code. WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED WHEN IT BRUSHED ASIDE PETITIONER'S CLAIMS FOR REINSTATEMENT [AND] WAGES ALLEGEDLY FOR BEING MOOT AND ACADEMIC.[43] (Underscoring supplied) Our Ruling I. A reading of the weight standards of PAL would lead to no other conclusion than that they constitute a continuing qualification of an employee in order to keep the job. As explained by the CA: .CABIN ATTENDANTS WERE EITHER GIVEN FLYING DUTIES OR PROMOTED. an employee may be dismissed the moment he is unable to comply with his ideal weight as prescribed by the weight standards. Tersely put.

x x x[45] Petitioner. a violation is not one of the faults for which an employee can be dismissed pursuant to pars. the failure to maintain these standards does not fall under Article 282(a) whose express terms require the element of willfulness in order to be a ground for dismissal. advances a very interesting argument. the employee can be dismissed simply because he no longer "qualifies" for his job irrespective of whether or not the failure to qualify was willful or intentional. (a) to (d) of Article 282. They apply prior to employment because these are the standards a job applicant must initially meet in order to be hired.. Benguet Consolidated. they were the "prescribed weights" that a cabin crew must maintain in order to qualify for and keep his or her position in the company. these "qualifying standards" are norms that apply prior to and after an employee is hired.the "other causes analogous to the foregoing. He claims that obesity is a "physical abnormality and/or illness. In other words.[47] he says his dismissal is illegal: . though." By its nature. Inc. Under this perspective. In this sense."[46] Relying on Nadura v.x x x [T]he standards violated in this case were not mere "orders" of the employer. they were standards that establish continuing qualifications for an employee's position. The failure to meet the employer's qualifying standards is in fact a ground that does not squarely fall under grounds (a) to (d) and is therefore one that falls under Article 282(e) . They apply after hiring because an employee must continue to meet these standards while on the job in order to keep his job.

in Nadura. Third. the rationale there cannot apply here. except the just cause mentioned in sub-paragraph 1(a). 1787.occasional attacks of asthma . Benguet invokes the provisions of subparagraph 1(f) and says that Nadura's illness . How Nadura's illness could be considered as "analogous" to any of them is beyond our understanding. First. the employee who was a miner. the issue of flight safety is absent in Nadura." It is clear that. was laid off from work . as the trial court said.Conscious of the fact that Nadura's case cannot be made to fall squarely within the specific causes enumerated in subparagraphs 1(a) to (e). thus. "illness cannot be included as an analogous cause by any stretch of imagination. Nadura was not decided under the Labor Code. The law applied in that case was Republic Act (RA) No. there being no claim or pretense that the same was contracted through his own voluntary act. The factual milieu in Nadura is substantially different from the case at bar. Even a cursory reading of the legal provision under consideration is sufficient to convince anyone that.[48] The reliance on Nadura is off-tangent. all the others expressly enumerated in the law are due to the voluntary and/or willful act of the employee. Second.is a cause analogous to them.

the evidence on record militates against petitioner's claims that obesity is a disease. Indeed. i. the issue centers on the propriety of the dismissal of petitioner for his failure to meet the weight standards of PAL. In the case at bar. during the clarificatory hearing on December 8. then the answer is yes. petitioner was dismissed for his failure to meet the weight standards of PAL. Fifth. He was not dismissed due to illness. Fourth.. .e.because of illness. the issue in Nadura is whether or not the dismissed employee is entitled to separation pay and damages. Thus. He could have easily availed the assistance of the company physician. in Nadura. and self-discipline. petitioner was accorded utmost leniency.[51] He chose to ignore the suggestion. determination. he repeatedly failed to report when required to undergo weight checks. petitioner himself claimed that "[t]he issue is could I bring my weight down to ideal weight which is 172. He was given more than four (4) years to comply with the weight standards of PAL. Here. asthma. the employee was not accorded due process. Here. Here. petitioner has only himself to blame. petitioner claims that reducing weight is costing him "a lot of expenses. per the advice of PAL. 1992. That he was able to reduce his weight from 1984 to 1992 clearly shows that it is possible for him to lose weight given the proper attitude. his fluctuating weight indicates absence of willpower rather than an illness."[50] However. without offering a valid explanation. In fact. I can do it now."[49] True.

Department of Mental Health. Retardation and Hospitals. At that time. Cook re-applied for a similar position. State of Rhode Island. In that case. In 1988. Even respondent admitted that her performance met the Center's legitimate expectations. thus plaintiff could simply lose weight and rid herself of concomitant disability. "she stood 5'2" tall and weighed over 320 pounds.[52] decided by the United States Court of Appeals (First Circuit). The appellate Court disagreed and held that morbid obesity is a disability under the Rehabilitation Act and that respondent discriminated against Cook based on "perceived" disability. She twice resigned voluntarily with an unblemished record. Respondent claimed. however. that morbid obesity could never constitute a handicap within the purview of the Rehabilitation Act. Cook worked from 1978 to 1980 and from 1981 to 1986 as an institutional attendant for the mentally retarded at the Ladd Center that was being operated by respondent. obesity is a mutable condition. The ." Respondent claimed that the morbid obesity of plaintiff compromised her ability to evacuate patients in case of emergency and it also put her at greater risk of serious diseases. Cook contended that the action of respondent amounted to discrimination on the basis of a handicap. This was in direct violation of Section 504(a) of the Rehabilitation Act of 1973.[53] which incorporates the remedies contained in Title VI of the Civil Rights Act of 1964.Petitioner cites Bonnie Cook v. Among others.

whether they be in the nature of a wrongful action or omission. His obesity may not be unintended. Gross and habitual neglect. We hold that the obesity of petitioner." Unlike Cook." thus "mutability only precludes those conditions that an individual can easily and quickly reverse by behavioral alteration.evidence included expert testimony that morbid obesity is a physiological disorder. In the words of the District Court for the District of Rhode Island. It involves a dysfunction of both the metabolic system and the neurological appetite . but is nonetheless voluntary. the Court stated that "mutability is relevant only in determining the substantiality of the limitation flowing from a given impairment. Clearly. that is not the case here.suppressing signal system. Notably. however. and cardiovascular systems." According to the Circuit Judge. respiratory. This element runs through all just causes under Article 282. petitioner is not morbidly obese. which is capable of causing adverse effects within the musculoskeletal. At his heaviest. Cook was sometime before 1978 "at least one hundred pounds more than what is considered appropriate of her height. "[v]oluntariness basically means that the just cause is solely attributable to the employee without any external force influencing or controlling his actions. In fine. a . petitioner was only less than 50 pounds over his ideal weight. As the CA correctly puts it. when placed in the context of his work as flight attendant. Cook weighed "over 320 pounds" in 1988. becomes an analogous cause under Article 282(e) of the Labor Code that justifies his dismissal from the service.

Employment in particular jobs may not be limited to persons of a particular sex. It does not exist if there is no statute providing for it. The qualification is called a bona fide occupational qualification (BFOQ).[55] In the United States.[56] Petitioner contends that BFOQ is a statutory defense. is considered voluntary although it lacks the element of intent found in Article 282(a).[57] Further. (c). religion."[54] II. or national origin unless the employer can show that sex. and (d). or national origin is an actual qualification for performing the job. there is no existing BFOQ statute that could justify his dismissal.recognized just cause. . The dismissal of petitioner can be predicated on the bona fide occupational qualification defense. there are a few federal and many state job discrimination laws that contain an exception allowing an employer to engage in an otherwise unlawful form of prohibited discrimination when the action is based on a BFOQ necessary to the normal operation of a business or enterprise.[58] Both arguments must fail. religion.

[67] In short. and (2) that there is factual basis for believing that all or substantially all persons meeting the qualification would be unable to properly perform the duties of the job. The British Columbia Government and Service Employee's Union (BCGSEU).[64] (2) the employer must establish that the standard is reasonably necessary[65] to the accomplishment of that work-related purpose."[69] . (1) the employer must show that it adopted the standard for a purpose rationally connected to the performance of the job. in Star Paper Corporation v.[59] the Labor Code. the test of reasonableness of the company policy is used because it is parallel to BFOQ. Second.First.[63] the Supreme Court of Canada adopted the so-called "Meiorin Test" in determining whether an employment policy is justified. the Constitution. in British Columbia Public Service Employee Commission (BSPSERC) v.[66] this Court held that in order to justify a BFOQ.[68] BFOQ is valid "provided it reflects an inherent quality reasonably necessary for satisfactory job performance. and (3) the employer must establish that the standard is reasonably necessary in order to accomplish the legitimate work-related purpose. Under this test. Simbol. 7277[61] or the Magna Carta for Disabled Persons[62] contain provisions similar to BFOQ. Similarly.[60] and RA No. the employer must prove that (1) the employment qualification is reasonably related to the essential operation of the job involved.

Glaxo Wellcome Philippines.[72] and CA[73] are one in holding that the weight standards of PAL are reasonable. from the nature of its business and for reasons of public policy.[74] It is bound to carry its passengers safely as far as human care and foresight can provide. Inc. It was held that the company policy is reasonable considering that its purpose is the protection of the interests of the company against possible competitor infiltration on its trade secrets and procedures. using the utmost diligence of very cautious persons. it is standards of PAL show its obligations imposed upon it carrier.[70] the Court did not hesitate to pass upon the validity of a company policy which prohibits its employees from marrying employees of a rival company. A common carrier.[75] The law leaves no room for common carrier. the Labor Arbiter. Thus. mistake or oversight on the part of a only logical to hold that the weight effort to comply with the exacting by law by virtue of being a common . there is no merit to the argument that BFOQ cannot be applied if it has no supporting statute. Verily.[71] NLRC.. with due regard for all the circumstances. Too.In Duncan Association of Detailman-PTGWTO v. is bound to observe extraordinary diligence for the safety of the passengers it transports.

thrive due to public confidence on their safety records. expect no less than that airline companies transport their passengers to their respective destinations safely and soundly. Passenger safety goes to the core of the job of a cabin attendant. The weight standards of PAL should be viewed as imposing strict norms of discipline upon its employees. It is not farfetched to say that airline companies. the primary objective of PAL in the imposition of the weight standards for cabin crew is flight safety. and the stamina to withstand grueling flight schedules. In other words. . Truly. The most important activity of the cabin crew is to care for the safety of passengers and the evacuation of the aircraft when an emergency occurs.The business of PAL is air transportation. especially the riding public. People. it has committed itself to safely transport its passengers. The task of a cabin crew or flight attendant is not limited to serving meals or attending to the whims and caprices of the passengers. just like all common carriers. most particularly the cabin flight deck crew who are on board the aircraft. it must necessarily rely on its employees. As such. It cannot be gainsaid that cabin attendants must maintain agility at all times in order to inspire passenger confidence on their ability to care for the passengers when something goes wrong. the agility to attend to passengers in cramped working conditions. airlines need cabin attendants who have the necessary strength to open emergency doors. A lesser performance is unacceptable. In order to achieve this.

Given the cramped cabin space and narrow aisles and emergency exit doors of the airplane. The rationale in Western Air Lines v. the arguments of respondent that "[w]hether the airline's flight attendants are overweight or not has no direct relation to its mission of transporting passengers to their destination". That an obese cabin attendant occupies more space than a slim one is an unquestionable fact which courts can . Criswell[76] relied upon by petitioner cannot apply to his case. any overweight cabin attendant would certainly have difficulty navigating the cramped cabin area. Thus. What was involved there were two (2) airline pilots who were denied reassignment as flight engineers upon reaching the age of 60. The case of overweight cabin attendants is another matter. the body weight and size of a cabin attendant are important factors to consider in case of emergency." must fail. and narrow aisles and exit doors. In short. alleging that the age-60 retirement for flight engineers violated the Age Discrimination in Employment Act of 1967. Aircrafts have constricted cabin space.On board an aircraft. Age-based BFOQ and being overweight are not the same. They sued the airline company. and that the weight standards "has nothing to do with airworthiness of respondent's airlines. and a flight engineer who was forced to retire at age 60. there is no need to individually evaluate their ability to perform their task.

never did he question the authority of PAL when he was repeatedly asked to trim down his weight.judicially recognize without introduction of evidence. He does not dispute that the weight standards of PAL were made known to him prior to his employment.[78] In fact. not minutes. Bona fides exigit ut quod convenit fiat. Being overweight necessarily impedes mobility. Three lost seconds can translate into three lost lives. The job of a cabin attendant during emergencies is to speedily get the passengers out of the aircraft safely. Indeed. seconds are what cabin attendants are dealing with. Good faith demands that what is agreed upon shall be done. Evacuation might slow down just because a wide-bodied cabin attendant is blocking the narrow aisles. He is presumed to know the weight limit that he must maintain at all times. Petitioner is also in estoppel. These possibilities are not remote. The biggest problem with an overweight cabin attendant is the possibility of impeding passengers from evacuating the aircraft. in an emergency situation. Kung ang tao ay tapat kanyang tutuparin ang napagkasunduan. .[77] It would also be absurd to require airline companies to reconfigure the aircraft in order to widen the aisles and exit doors just to accommodate overweight cabin attendants like petitioner. should the occasion call for it.

Thus. the clear-cut rules obviate any possibility for the commission of abuse or arbitrary action on the part of PAL. It is a confession-and-avoidance position that impliedly admitted the cause of dismissal. including the reasonableness of the applicable standard and the private respondent's failure to comply."[80] It is a basic rule in evidence that each party must prove his affirmative allegation. III. petitioner has to prove his allegation with particularity. however. We agree with the CA that "[t]he element of discrimination came into play in this case as a secondary position for the private respondent in order to escape the consequence of dismissal that being overweight entailed. to hold otherwise. the weight standards of PAL provide for separate weight limitations based on height and body frame for both male and female cabin attendants.Too.[81] Since the burden of evidence lies with the party who asserts an affirmative allegation. There is nothing on the records which could support the finding of discriminatory treatment. Petitioner next claims that PAL is using passenger safety as a convenient excuse to discriminate against him.[79] We are constrained. Petitioner failed to substantiate his claim that he was discriminated against by PAL. Petitioner cannot establish discrimination by simply naming the supposed cabin attendants who . A progressive discipline is imposed to allow noncompliant cabin attendants sufficient opportunity to meet the weight standards.

the discriminating treatment they got from PAL. petitioner miserably failed to indicate their respective ideal weights. and other relevant data that could have adequately established a case of discriminatory treatment by PAL. are accorded respect. If it can be shown that administrative bodies grossly misappreciated evidence of such nature so as to compel a conclusion to the contrary. the periods they were allowed to fly despite their being overweight.are allegedly similarly situated with him. even finality. the particular flights assigned to them. except for pointing out the names of the supposed overweight cabin attendants.[83] The reason is simple: administrative agencies are experts in matters within their specific and specialized jurisdiction."[82] We are not unmindful that findings of facts of administrative agencies.[84] But the principle is not a hard and fast rule.[85] . their findings of facts must necessarily be reversed. Substantial proof must be shown as to how and why they are similarly situated and the differential treatment petitioner got from PAL despite the similarity of his situation with other employees. In the words of the CA. "PAL really had no substantial case of discrimination to meet. like the Labor Arbiter and the NLRC. Indeed. It only applies if the findings of facts are duly supported by substantial evidence. Factual findings of administrative agencies do not have infallibility and must be set aside when they fail the test of arbitrariness. weights over their ideal weights.

the liberties guaranteed by the Constitution cannot be invoked. the United States Supreme Court. no matter how egregious.Here. cannot violate the equal protection guarantee.[91] IV. We thus annul their findings.[87] Put differently. petitioner invokes the equal protection clause guaranty[86] of the Constitution. Article 223 of the Labor Code finds relevance: . However. the Labor Arbiter and the NLRC inexplicably misappreciated evidence. "from the time he was illegally dismissed" up to the time that the NLRC was reversed by the CA. To make his claim more believable. petitioner avers that his claims for reinstatement and wages have not been mooted.[89] which is the source of our equal protection guarantee. As his last contention. the Bill of Rights is not meant to be invoked against acts of private individuals.[90] Private actions. in interpreting the Fourteenth Amendment. He is entitled to reinstatement and his full backwages. in the absence of governmental interference.[92] At this point. The claims of petitioner for reinstatement and wages are moot. is consistent in saying that the equal protection erects no shield against private conduct.[88] Indeed. however discriminatory or wrongful.

even pending appeal. merely reinstated in the payroll. at the option of the employer.In any event.[93] the option to exercise actual reinstatement or payroll reinstatement belongs to the employer. to the labor tribunals."[94] there is evidence that PAL opted to physically reinstate him to a substantially equivalent position in accordance with the order of the Labor Arbiter. the decision of the Labor Arbiter reinstating a dismissed or separated employee. insofar as the reinstatement aspect is concerned. Although an award or order of reinstatement is self-executory and does not require a writ of execution. or even to the courts. The law is very clear. Contrary to the allegation of petitioner that PAL "did everything under the sun" to frustrate his "immediate return to his previous position. petitioner duly received the return to work notice on February 23. It does not belong to the employee. The employee shall either be admitted back to work under the same terms and conditions prevailing prior to his dismissal or separation or. shall immediately be executory. The posting of a bond by the employer shall not stay the execution for reinstatement provided herein.[95] In fact. 2001. as shown by his signature.[96] .

[100] V. petitioner in effect wants to render the issues in the present case moot. a legally dismissed employee is not entitled to separation pay. the Court ruled that the law does not exact compliance with the impossible. all is not lost for petitioner. in order to insist on the payment of his full backwages. Neither does it appear on record that he actually rendered services for PAL from the moment he was dismissed. He asks PAL to comply with the impossible. In insisting that he be reinstated to his actual position despite being overweight."[99] He failed to prove that he complied with the return to work order of PAL.Petitioner cannot take refuge in the pronouncements of the Court in a case[97] that "[t]he unjustified refusal of the employer to reinstate the dismissed employee entitles him to payment of his salaries effective from the time the employer failed to reinstate him despite the issuance of a writ of execution"[98] and ""even if the order of reinstatement of the Labor Arbiter is reversed on appeal. Normally. Petitioner is entitled to separation pay. This may be deduced from the language of Article 279 of the . it is obligatory on the part of the employer to reinstate and pay the wages of the employee during the period of appeal until reversal by the higher court. Be that as it may. Time and again.

"[102] In both instances.Labor Code that "[a]n employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages. the appealed Decision of the Court of Appeals is AFFIRMED but MODIFIED in that petitioner Armando G. Yrasuegui is entitled to separation pay in an amount equivalent to one-half (1/2) . Exceptionally. inclusive of allowances. and (2) does not reflect on the moral character of the employee. this is not an ironclad rule. We also recognize that his employment with PAL lasted for more or less a decade. it is required that the dismissal (1) was not for serious misconduct. We grant petitioner separation pay equivalent to one-half (1/2) month's pay for every year of service. separation pay is granted to a legally dismissed employee as an act "social justice."[101] or based on "equity.[103] Here.[105] We are not blind to the fact that he was not dismissed for any serious misconduct or to any act which would reflect on his moral character. and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement.[104] It should include regular allowances which he might have been receiving." Luckily for petitioner. WHEREFORE.

which should include his regular allowances. petitioner. FILOTEO. SANDIGANBAYAN and THE PEOPLE OF THE PHILIPPINES. [Syllabus] EN BANC [G. JR. J. DECISION PANGANIBAN.: A person under investigation for the commission of an offense is constitutionally guaranteed certain rights. October 16. vs. respondents. One of the most cherished of these is the right “to have competent and independent counsel .month's pay for every year of service..R. 1996] JOSE D. 79543. No.

unlike its predecessors. Jr. The Facts Petitioner Jose D. In the present case. 1987 denying his motion for reconsideration. A recipient of various awards and commendations attesting to his competence and performance as a police officer. that his extrajudicial confession was extracted through torture. 8496 promulgated on June 19. expressly covenants that such guarantee “cannot be waived except in writing and in the presence of counsel”. he could not . though not raised by petitioner.long before the effectivity of the new Constitution. Challenged in the instant amended petition is the Decision[1] of respondent Sandiganbayan[2] in Criminal Case No. petitioner claims that such proscription against an uncounselled waiver of the right to counsel is applicable to him retroactively. and that the prosecution’s evidence was insufficient to convict him. even though his custodial investigation took place in 1983 -.brigandage or robbery -. the question of what crime -. an old hand at dealing with suspected criminals. Finally. The 1987 Constitution. He also alleges that his arrest was illegal.was committed is likewise motu propio addressed by the Court in this Decision.preferably of his choice”. Filoteo. was a police investigator of the Western Police District in Metro Manila. and the Resolution[3] promulgated on July 27. 1987 convicting petitioner of brigandage.

the said accused. Along with his co-accused Martin Mateo. CIC Ed Saguindel y Pabinguit. Reynaldo Frias. threat and intimidation. conspiring. Raul Mendoza. and within the jurisdiction of this Honorable Court. rob and carry away with them the following. y Mijares. Philippines.therefore imagine that one day he would be sitting on the other side of the investigation table as the suspected mastermind of the armed hijacking of a postal delivery van. 1982. Jr. did then and there wilfully. Angel Liwanag. Danilo Miravalles y Marcelo and civilians Ricardo Perez. at the point of their guns. province of Bulacan. two of whom were armed with guns. and then take. y Retino. to wit: 1) Postal Delivery Truck 2) Social Security System Medicare Checks and Vouchers . confederating together and helping one another. Severino Castro and Gerardo Escalada. Bernardo Relator. stop the Postal Delivery Truck of the Bureau of Postal while it was travelling along the MacArthur Highway of said municipality. in the municipality of Meycauyan. PC/Sgt. Ex-PC/Sgt. Jr. petitioner Filoteo was charged in the following Information:[4] “That on or about the 3rd day of May. unlawfully and feloniously with intent of gain and by means of violence.

Castro and Escalada were never arrested and remained at large. Relator and Miravalles. Section 19 of the 1973 Constitution. Like in the case of Mateo. belonging to US Government Pensionados.29 more or less. Bataan.3) Social Security System Pension Checks and Vouchers 4) Treasury Warrants 5) Several Mail Matters from abroad in the total amount of P253. SSS Pensionados. 1986. respectively. Zambales and Olongapo City. Mateo. SSS Medicare Beneficiaries and Private Individuals from Bulacan. Accused Saguindel and Relator failed to appear during the trial on February 21.” On separate dates. to the damage and prejudice of the owners in the aforementioned amount.728. 1985 and on March 31. accused Filoteo. pleaded not guilty. Pampanga. Accused Mateo escaped from police custody and was tried in absentia in accordance with Article IV. Saguindel. and were thus ordered arrested but remained at large since then. Contrary to law. Their co-accused Perez. proceedings . assisted by their respective counsel. Liwanag. Frias. Mendoza.

PC. accused Relator was issued a service revolver.[5] Only Filoteo filed this petition. after the respondent Court rendered its assailed Decision and Resolution. in 1982 or thereabouts. 11707 (Exhibit B) and holster (Exhibit B-1) with six (6) live ammo (Exhibit B-2). 1982. and the three availed of their right to remain silent and to have counsel of their choice. with Serial No. on May 30. accused Eddie Saguindel was a PC Constable First Class. 32 (sic).” . Before trial commenced and upon the instance of the prosecution for a stipulation of facts. accused Saguindel. the defense admitted the following:[6] “The existence of the bound record of Criminal Case No. as shown by their Joint Affidavit (Exhibit A-20). accused Bernardo Relator was a PC Sergeant at Camp Bagond Diwa. together with accused Relator and Danilo Miravalles. Metro Manila. 50737-B-82. subject to the qualification that said document was made under duress. a former PC Sergeant.against them were held in absentia. in 1982 or thereabouts. was invited for investigation in connection with the hijacking of a delivery van by the elements of the Special Operations Group. 1982. Bicutan. as such PC Sergeant. consisting of 343 pages from the Bulacan CFI (Exhibit A). Smith & Wesson Revolver. and the existence of the sworn statement executed by accused Martin Mateo (Exhibit A-11) as well as the Certification dated May 30.

Filoteo also submitted his Exhibits 1-14Filoteo. accused Filoteo and Miravalles presented their respective testimonies plus those of Gary Gallardo and Manolo Almogera. Noel Alcazar and Capt. Evidence for the Prosecution At about 6:30 in the morning of May 3. Bureau of Post mail van no. but Miravalles filed no written evidence. Capt. As they had to deliver mail matters to several towns of Bulacan. Pampanga to pick up and deliver mail matters to and from Manila. Thereafter. Rosendo Ferrer.6-a and the submission of Exhibits A to K.The prosecution sought to prove its case with the testimonies of Bernardo Bautista. They arrived at around 9:40 that morning at the Airmail Distribution Center of the Manila International Airport where they were issued waybills[7] for the sacks of mail they collected. When . 1982. the prosecution proffered rebuttal evidence and rested with the admission of Exhibits A-16-a. In their defense. They then proceeded to the Central Post Office where they likewise gathered mail matters including 737 check letters[8] sent by the United States Embassy. Rodolfo Miranda. they took the MacArthur Highway on the return trip to Pampanga. Jr. Samuel Pagdilao. All the mail matters were placed inside the delivery van. MVD 02 left San Fernando. A-31 and L. and its door padlocked. and two couriers named Bernardo Bautista and Eminiano Tagudar who were seated beside the driver. On board the vehicle were Nerito Miranda. M/Sgt. the driver.

Meycauayan. the three delivery employees were ordered to lower their heads. “Are you not going to stop this truck?”*11+ Frightened. Nerito Miranda asked permission to straighten up as he was feeling dizzy for lack of air. The car had five (5) passengers -. He also recognized the driver who had glanced back.[10] Two of the car passengers aimed an armalite and a hand gun at driver Nerito Miranda as someone uttered. As he was about to enter the car. Inside the car. They sat between two of their captors at the back of the car while two others were in front. who turned out to be Reynaldo Frias. the third man in front and the person immediately behind him were both clad in fatigue uniforms. . he caught a glimpse of the pimply face of the man to his left.[13] The three postal employees were then ordered to board the Benz. while the fifth man in the back had on a long-sleeved shirt.they reached Kalvario. The car’s driver and the passenger beside him were in white shirts. Miranda pulled over and stopped the van’s engine. going up the van. As he stretched. Bulacan at about 4:30 in the afternoon. an old blue Mercedes Benz sedan[9] overtook their van and cut across its path. he surrendered it to one of the car passengers. Later. the armed group identified themselves as policemen.[12] They ordered the postal employees to disembark from the van.three seated in front and two at the back. Bautista looked back and saw one of the malefactors. Miranda took the ignition key with him. As he stepped out of the van. Alighting from the car. but when threatened.

respectively. Quezon City on May 4. along with the van’s battery.[16] including checks and warrants. The Security and Intelligence Unit of the Bureau of Posts recovered the postal van at the corner of Malindang and Angelo Streets. Liwanag. They were made to remove their pants and shoes and then told to run towards the shrubs with their heads lowered. The man in uniform on the front seat was Eddie Saguindel. Bautista complained about feeling “densely confined”. Saguindel and Frias in the line-up of suspects at Camp Crame later on. However.[15] These incidents yielded the pieces of information critical to the subsequent identification of Mendoza. Earlier. Discovered missing were several mail matters. La Loma. he sneaked a look and recognized the driver of the car as Raul Mendoza and the fellow beside him who poked a “balisong” at him as Angel Liwanag. He was allowed to raise his head but with eyes closed. the captured men discovered that they were along Kaimito Road in Kalookan City.[17] .These men turned out to be Angel Liwanag and Reynaldo Frias. as he was about to enter the car. When it finally came to a stop.[14] As the car started moving. they put on their pants and reported the incident to the Kalookan Police Station. The car seemed to move around in circles. Upon realizing that the hijackers had left. Bautista looked back and recognized Frias. tools and fuel. 1982.

Ferrer introduced himself and his companions as lawmen investigating the hijacking incident. Ferrer requested the informer to arrange a meeting with them. One group was led by Capt. With cash on hand. investigate and “neutralize” criminal syndicates in Metro Manila and adjacent provinces. Tondo. Shocked and distressed. then Postmaster General Roilo S. Quezon City. which was tasked to detect. After some negotiations. Then as they boarded a car.[18] Responding to the request. Frias . Frias in turn showed Capt. the SOG received a tip from a civilian informer that two persons were looking for buyers of stolen checks. they agreed to proceed to Tondo. 1982. On May 28. Capt. The informer introduced him to Rey Frias and Rafael Alcantara. the SOG. Manila. Capt. The meeting materialized at about 9:00 P. Ferrer posed as the buyer. Samuel Pagdilao.In a letter-request dated May 6. 1982 at the Bughaw Restaurant in Cubao. Golez sought the assistance of the Special Operations Group (SOG) of the Philippine Constabulary in the investigation of the hijacking incident. of May 29.M. Initially. they conducted a “massive intelligence build-up” to monitor the drop points where the stolen checks could be sold or negotiated. Ramon Montaño. Frias calmed down only when assured that his penalty would be mitigated should he cooperate with the authorities. organized two investigative teams. Ferrer a sample Social Security System (SSS) pension check and told him that the bulk of the checks were in the possession of their companions in Obrero. Capt. 1982 to then Col. Rosendo Ferrer and the other by 1st Lt.

Capt. Capt. Alcantara was turned over to the investigation section of the SOG for further questioning. Pagdilao’s custody. Perez admitted participation therein and expressed disappointment over his inability to dispose of the checks even after a month from the hijacking. Ferrer received information over their two-way radio that Ricardo Perez and Raul Mendoza were in Lt. Pagdilao and his companions should meet him in Quirino. On the way to the headquarters. Lt. 1982. Pagdilao’s group was able to corner Ricardo Perez in his house in Tondo. Lt. He surrendered the checks in his possession to Lt. Ferrer ordered that. Pagdilao. his assistant operations officer who was in another car during the mission. Ferrer instructed Lt. instead of returning to headquarters. Alcantara denied participation in the hijacking although he admitted living with Martin Mateo who allegedly was in possession of several checks. Tondo while he escorted Alcantara to their headquarters at Camp Crame. to accompany Frias to Obrero. Confronted with the hijacking incident.M. Capt. Meanwhile. . Novaliches to apprehend Martin Mateo.thus volunteered to help crack the case and lead the SOG team to Ricardo Perez and Raul Mendoza.[19] An hour and a half later. of May 29. Pagdilao. Novaliches arriving there at about 10:30 P. They met at the designated place and proceeded to Gulod.

Ferrer directed Lt. On the way to the SOG headquarters in Camp Crame. Jose D. At a confrontation with Perez and Mendoza. Manila. Pursuant to standard operating procedure in arrests. However. Upon being invited to Camp Crame to shed light on his participation in the hijacking.[22] whereupon they proceeded to Camp Crame. Mateo said. talo na kami. when retrieved. Capt. returned to the latter’s place to recover the loot..[20] As the two were about to board the SOG teams's car. petitioner was dumbfounded (“parang nagulat”). Consequently. including petitioner. Pagdilao to accompany Mateo to the house of petitioner in Tondo. Marami pa akong tseke doon sa bahay ko. The latter threw something into the ricefield which. sir.”*21+ Capt. kunin na natin para di na natin babalikan. The lawmen found petitioner at home. petitioner was informed of his constitutional rights. . Filoteo. as the mastermind of the crime. Perez identified them as Martin Mateo and Angel Liwanag. all four of them pointed to petitioner. Ferrer accompanied Mateo to his house where they retrieved several other checks in another plastic bag. the group. “Sir.Walking atop a ricefield dike to the house of Mateo. kung baga sa basketball. Jr. Mateo and Liwanag admitted participation in the postal hijacking. Ibibigay ko yong para sa panalo. they noticed two men heading in their direction. turned out to be bundles of checks wrapped in cellophane inside a plastic bag.

Espero which. . 1982. Thereupon. Patrolman Filoteo.[23] The authorities confronted Filoteo about his participation in the hijacking. Bernardo Relator and Jack Miravalles (who turned out to be a discharged soldier). Filoteo admitted involvement in the crime and pointed to three other soldiers. na ang dahilan ng pagsisiyasat na ito ay tungkol sa isang kasong Robbery-inBand/Hi-Jacking na naganap noong ika-3 ng Mayo 1982 doon sa Meycauyan. Bulacan. quoted in full. Arsenio C. Nais ko ring ibigay sa iyo ang babala alinsunod sa mga isinasaad ng Section 20. Na ikaw ay may karapatang tumahimik. as his confederates. At 1:45 in the afternoon of May 30. mga bandang alas-4:00 ng hapon. tseke ng BIR at iba pang mga personal na tseke ang nabawi mula sa iyo. humigitkumulang. telling him that Frias.It was “in the neighborhood. kung saang maraming tsekeng US. Article IV ng Bagong Saligang Batas ng Republika ng Pilipinas. reads as follows: “BABALA: -. Carlos and Sgt. petitioner executed a sworn statement in Tagalog before M/Sgt.Nais kong ipaalam sa iyo.” not in petitioner’s house. namely. Eddie Saguindel. Mendoza and Perez had earlier volunteered the information that petitioner furnished the Benz used in the hijacking. Romeo P. where the authorities located the checks. kagaya ng mga sumusunod: a.

c. 1. d. ako mismo ang makipag-ugnayan sa CLAO-IBP upang ikaw ay magkaroon ng isang abugadong walang bayad. 2. Na ikaw ay may karapatang huwag sumagot sa mga katanungang maaring makasira sa iyo sa dahilang anumang iyong isalaysay ay maaaring gamitin pabor or laban sa iyo sa kinauukulang hukuman. T:. TANONG:.b.Handa mo bang lagdaan ang ilalim ng katanungan at sagot na ito bilang katibayan na iyo ngang naiintindihan ang iyong mga karapatan at gayun na rin sa dahilan ng pagsisiyasat na ito.Ang mga bagay-bagay bang akin nang naipaliwanag sa iyo ay iyong lubos na naiintindihan at nauunawaan? SAGOT:. at ikaw din ay nakahanda ngang magbigay ng isang malaya at kusang-loob na salaysay. Na ikaw ay walang maibabayad sa isang abugado. sumagot sa mga katanungan at sumusumpang lahat ng iyong isasalaysay ay pawang mga katotohanan lamang? .Opo. Na ikaw ay may karapatang kumuha ng isang abugadong sarili mong pili upang may magpapayo sa iyo habang ikaw ay sinisiyasat.

ESPERO THERESA L.. FILOTEO (Affiant) MGA SAKSI: (Sgd. pipirma ako Ser. TOLENTINO Ssg.) JOSE D. PC C1C WAC (PC)" 3.) (Sgd. (Sgd. edad at iba pang bagay-bagay na maaring mapagkakikilalanan sa iyo? . T:.) ROMEO P.Maari bang sabihin mong muli ang iyong buong pangalan.Opo.S:.

.Pagkakaalam ko sa tatay ko ay Bulacan samantalang ang aking ina naman ay Bisaya. hindi ko maalaala ang exactong petsa. MPF? S:.Kailan ka pa na-appoint sa service bilang isang Kabatas? S:. T:. noong ako ay mapasok sa serbisyo. 4. Dagupan. 810 Cabesas St. T:. 5. 30-anyos. Investigation Division ng naturang Distrito ng Pulisya at kasalukuyang nakatira sa No. isang Patrolman ng Western Police District. Tondo. 6. WPD. .Kailan ka pa naman na-assign sa GAS. T:.Noon pong October 1978. pero ako ay ipinanganak na sa Maynila noon July 17. may asawa. ikaw ba ay tubong saang bayan.Jose Filoteo y Diendo. 1951. Metropolitan Police Force na kasalukuyang nakatalaga sa General Assignment Section. Manila. lungsod or lalawigan? S:.Patrolman Filoteo.Noon lamang pong January 1982.S:.

At bilang miyembro ng follow-up unit ng GAS.Ano naman ang natapos mong kurso sa pag-aaral? S:.Noong ika-3 ng Mayo 1982. 8. WPDMPF? S:. T:. 9. eh. T:. saan ka naroroon at ano ang iyong ginagawa? S:.Nasa Plaza Lawton ho kami.7. . dahil hindi ko natapos ang second semester ng 4th year ko. at inaantay na namin iyong hinayjack namin na Philippine Mail delivery van. T:.Kami po ang magsasagawa ng follow-up kung may mga at large sa mga suspects namin sa mga kasong hawak ng investigation. ID. mga bandang alas-4:00 ng hapon humigit kumulang. ano naman ang iyong mga specific duties? S:. 10.Ano naman ang iyong specific designation sa GAS. T:.Undergraduate ako ng BS Criminology sa PCCr.Sa Follow-Up Unit ako.

si Rey Frias. Sgt. Dan Miravales at isa pang Sergeant na ang alam ko lang sa kanya ay JUN ang tawag namin. Jun na parehong taga-LRP (affiant added and initialled this additional fact: ‘AT RAUL MENDOZA’). Walo (8) (corrected and initialled by affiant to read as ‘SIYAM *9+’) kaming lahat doon noon at ang mga gamit naman naming kotse noon ay ang kotse ng kumpare kong si Rudy Miranda na isang Mercedes Benz na may plakang NMJ659 kung saang ang driver namin noon ay si Raul Mendoza (corrected and initialled by affiant to read as ‘AKO’) at ang mga kasama naman naming sakay ay sina Angelo Liwanag.). Ed Saguindel at Sgt. Angelo Liwanag at ang mga taga LRP ng PC Brigade na sina Sgt. Rey Frias at Sgt. Jr. T:. dahil ang mastermind dito sa trabahong ito ay si Carding PEREZ at kami naman ng mga sundalong taga-LRP ay kanila lamang inimporta upang umeskort sa kanila sa pag-hijack ng delivery van. Sgt. Ed Saguindel. Dan Miravalles ng LRP rin. Pero may kasama pa kaming contact ni Carding Perez na taga-loob ng Post Office na sina Alias NINOY na isang dispatcher at Alias JERRY. si Junior ho (Affiant pointed to Martin Mateo. . Jr. sinu-sino ang tinutukoy mong mga kasamahan? S:.Si Carding Perez. ho.11. who was seated in the investigation room and asked the name and was duly answered: Martin Mateo. Raul Mendoza.Wika mo’y kami. Ang isang kotse namang gamit namin ay pagaari daw ng pinsan ni Carding Perez na kanya na rin mismong minamaneho na isang Lancer na dirty-white ang kulay at ang mga sakay naman ni Carding Perez ay sina Junior Mateo.

Nag-Utturn (sic) kami ngayon at ibinalik na namin sa Manila ang van. Bulacan ay kumuha na kami ng tiyempo at noon makatiyempo kami ay kinat namin ang delivery van. Iyong . Ako naman ay bumaba na sa aming kotse at sumakay ng delivery van at ako na mismo ang nagmaneho at sinamahan naman ako nina Junior Mateo at si Rey Frias. 13.Noon pong lumakad na ang delivery van ng Central Post Office. T:. Noong makapasok na kami ng boundary ng Meycauyan.Isalaysay mo nga ng buong-buo kung ano ang mga naganap noong hapon na iyon? S:.12. sinundan na namin. Ed Saguindel at Sgt. sumunod ang Lancer at huli ang Mercedes Benz namin. van naman ngayon. Pinababa nila ang tatlong maydala ng delivery van at pinasakay sa Mercedes Benz. tatlo (3) rin kaming pumalit sa puwesto noong tatlong (3) taga-Post Office na maydala ng delivery van. Pagdating namin sa Malinta. sunod ang Mercedes Benz at huli na ang Lancer. una ang van. Jun ng LRP dahil sila noon ang may hawak ng kanilang Armalite Rifle pero may service pa silang maiksing baril.Anong oras naman noong umalis ang delivery van ng Post Office patungong norte? S:. T:. Tumigil naman ito at bumaba kaagad sina Sgt.Kung hindi ako nagkakamali ay nasa pagitan na noon ng alas-4:00 hanggang alas-5:00 ng hapon. Valenzuela Metro Manila ay nagpalit kami ng puwesto sa pagsunod. habang nakatutok ang kanilang mga baril sa kanila.

T:. Tondo. dahil ang Lancer ay isinoli na raw nila sa may-ari.Mercedes Benz na minamaneho pa rin ni Raul Mendoza ay dumeretso pa norte samantalang ang Lancer naman ay nag-U-turn din at sumunod sa amin. at noong nakarating ng kami roon ay iniyatras ko na ang van sa kanilang garahe at doon ay ibinaba namin lahat ang mga duffle bag. . na siyang laman ng delivery van at pagkatapos ay umalis kaming muli ng mga kasama ko rin sa van papuntang Quezon City kung saan namin inabandon ang delivery van. Manila at inabutan na namin sila na nagkakarga na noong mga duffle bag sa (sic). 14. parang follow the leader na dahil siya na noon ang aming guide. hindi ko na po alam kung ilan lahat iyon. kung hindi ako nagkakamali. Sa Retiro ho yata iyong lugar na iyon.Sumakay kami ngayon ng taksi at bumalik na kami kina Carding Perez sa may bahay nila sa Obrero.Ano ang mga sumunod na nangyari? S:. sa bahay mismo nina Carding Perez. sa isang kotseng mamula-mula o orange na Camaro at isa pang Mercedes Benz na brown. Noong makarating na kami sa Malinta. 15. T:. Dinala nila ngayon ang mga duffle bag sa Bocaue. Metro Manila ay inunahan na kami ng Lancer at iyon na nga.Dumeretso kami ngayon sa may Obrero. Valenzuela. madilim na ho noon.Ipagpatuloy mo ang iyong pagsasalaysay? S:.

Iyon na nga. maliban sa mga dalawang sundalong naihatid na namin sa may Manila. pagkatapos ay nagbukasan na ng mga duffle bag. Kumain kami. Naiwan na noon ang Mercedes Benz namin doon kina Rudy Miranda at iniwan na rin ang susi doon sa kamag-anak. Si JACK o Sgt. Bulacan.Bulacan. pero wala na ang crew ng delivery van dahil ibinaba at iniwanan daw nila sa Caloocan City. Kami naman ngayong apat. Saguindel at Sgt. Jun doon sa tinitirhan nitong huling nabanggit na sundalo doon sa malapit sa Del Pan Bridge sa may Recto Avenue sa San Nicolas yata iyon sa Manila. Ed Saguindel at si Sgt. si Sgt. si Raul Mendoza. Angelo Liwanag at si Raul Mendoza ay tumuloy na sa Bocaue. hindi ko alam ang lugar pero alam kong puntahan. Manila na sakay ng isang Toyota Corona na brown na si Carding Perez ang nagmaneho. (Affiant pointed to the checks he voluntarily surrendered) at aming inihiwalay ngayon sa mga sulat na naroon na sinunog lahat pagkatapos doon sa . dahil hindi nila alam ang trabahong ito. Ang naroroon na lamang noon ay sina Angelo Liwanag. Dumaan kami sa North Diversion Road at paglabas namin sa exit papuntang Bocaue. Malate. Dan Miravalles ay naroon din noon. Bahay daw yata ng kamag-anak ni Carding Perez iyon pero hindi ko alam ang pangalan.nakita na namin ang mga tsekeng ito. Sumakay na iyong apat naming kasama sa Toyota Corona na sakay namin at inihatid namin sina Sgt. sina Carding Perez. Jun na parehong taga-LRP. Pagdating namin doon sa kina Rudy Miranda ay naroon na rin noon ang Mercedes Benz na ginamit namin. Bulacan ay hindi na kalayuan doon. iyon kasi ang usapan namin noon dahil sumilip lamang ako noon at kasama ko si Carding Perez. at may mga nadagdag pang ibang mukha pero hindi ko ito mga kakilala. Naroon na ngayon ang buong tropa. kami naman ngayon ay pumunta sa bahay nina Rudy Miranda sa San Marcelino.

Ito ngayon ay parte namin nina Sgt.Wala po akong baril. Di magdamag ngayon ang trabaho namin. sabihin mo nga kung anong uring baril iyon? S:. Ser. inilipat na namin doon sa bahay ni Junior Mateo ang mga tsekeng ito (Affiant again referred to said checks). Dan Miravalles Alias JACK at ni Sgt. gabi. T:. Ed Saguindel. na mahirap mahalata. dahil iyong partehan sana namin ay puro pangako ang nangyari. habang tumatagal ay umiinit ang situwasyon sa aming grupo.bahay ni Junior Mateo sa Novaliches. Pero habang tumatagal ay umiinit at nalaman namin pati na may alarma na. T: Ikaw ba naman ay mayroong dalang baril noon at kung ganoon.Paano naman napunta ang mga tsekeng ito (the checks recovered from the Affiant was referred to) sa iyo? S:.E. Sgt. Kaya napagpasiyahan namin na hatiin na lamang iyong mga tseke upang walang onsehan sa amin. dahil noong una ay doon muna sa amin ito nakatago (The checks recovered from the Affiant was referred to). Iyong mga tsekeng iyan ngayon ay nakalagay noon doon sa isang sikretong compartment sa gitna ng truck. di ganoon na nga ho. Kinabukasan muli. Sikretong compartment iyon. 17. Jun. Isinakay namin noon sa isang cargo truck na pag-aari din daw nina Carding. 16. doon ba sa may chassis. kinabukasan ay kanya-kanyang uwian na. pagkatapos ay pahinga. kaya’t .

Iyong araw na lamang na iyon ko sila nakita. at hanggang sa kinuha na namin ang supot na ito (the checks placed in a plastic bag was again referred to) ay wala pa rin kamalay-malay ang kumare ko. Makikilala ko itong si Alias NINOY kung makita ko siyang muli. dahil maghapon ko noon silang nakikita. itong si Alias NINOY lamang ang dispatcher. dahil palabas-labas siya noon at nakikipag-usap kina Carding Perez.Iyong sinasabi mong mga kontak nina Carding Perez sa Central Post Office. T:. 19. T:. pero hindi alam nitong kumare ko ang laman noon dahil mahigpit kong ipinagbilin na huwag nilang bubuksan.Si Junior Mateo po.Sino naman ang kumontak sa iyo upang sumama sa trabahong ito? S:. pansamantala. .inilipat namin doon sa may Raxa Bago sa may likod ng Alhambra Cigar & Cigarette Factory sa Tondo. Doon na rin namin kinuha iyon noong isurender ko ang mga tsekeng ito kagabi. ipinakilala niya ako kina Carding at sa buong tropa na namin. Raul Mendoza at saka si Rey Frias. 18. Manila at akin munang ipinatago sa isang kumare ko doon. mga kakilala mo rin ba ang mga ito? S:.

Handa mo bang lagdaan ang iyong salaysay na ito bilang patotoo sa katotohanan nito nang hindi ka pinilit. . . /ac (Sgd. T:. .) JOSE D. 21.Opo. sinaktan or pinangakuan kaya ng anuman upang lumagda lamang? S:. bawasin o palitan kaya sa salaysay na ito? S:.) . FILOTEO MGA SAKSI SA LAGDA: (Sgd.Wala na po. WAKAS NG SALAYSAY: . T:.Pansamantala ay wala na muna akong itatanong pa sa iyo. .20. mayroon ka bang nais na idagdag.

” that because of the “large number of pieces” of checks. One was a certification stating that he voluntarily surrendered “voluminous assorted US checks and vouchers.SSG ROMEO P. he affixed his signature upon the middle portion of the back of each check “to serve as identification in the future. and that the investigators offered him counsel from the CLAO-IBP but he refused to avail of the privilege. 1982. and that he “guided the elements of SOG” to the residence of Rodolfo C.) CIC THERESA TOLENTINO WAC (PC)”*24+ Petitioner executed two other documents on the same day.m. Miranda. Article IV of the (1973) Constitution. 1982 “sa dahilang ako ay kasangkot sa pagnanakaw ng mga US . of May 29.[25] The other document was a sworn statement wherein petitioner attested to his waiver of the provisions of Article 125 of the Revised Penal Code and the following facts: (a) that he was apprised of his constitutional rights under Section 20. that he understood all his rights thereunder. ESPERO PC (Sgd. May 30. (b) that he was arrested by SOG men in his house at around 11:00 p. prior to the completion of its proper inventory and listing conducted by elements of SOG” in his presence. the owner of the sky-blue Mercedes Benz car which was surrendered to the SOG Headquarters.

They met Miravalles along the way to his house.Treasury Warrants. SSS Pension Checks and Vouchers at SSS Medicare Checks and Vouchers mula sa delivery van ng Philippine Mail. having knowledge that his car was used in the hijacking until the authorities came to his house. Eddie Saguindel and Bernardo Relator.[27] After the trip to Miranda’s house.[26] As certified to by petitioner (in the above described document). and (d) that he was not hurt or maltreated nor was anything taken from him which was not duly receipted for. however.[28] Upon learning of the whereabouts of Miravalles. Metro Manila in the afternoon of May 30. The car was not returned until the evening following that when it was borrowed. He denied. Ferrer proceeded to Taguig.” (c) that the SOG men confiscated from him numerous checks and a Mercedes Benz 200 colored sky-blue. 1992 at the SOG. the team of Capt. petitioner informed the investigators that some more checks could be recovered from his kumare. he led the SOG operatives to the house of Rodolfo Miranda on Singalong where the latter admitted that petitioner was his friend. Ferrer that six of his companions were already under custody and that they implicated him . he was made to believe that his car would be used for surveillance purposes because petitioner’s jeep was not available. According to Miranda. Said checks were retrieved and turned over to headquarters along with the car surrendered by Miranda who later executed a sworn statement dated May 31. Informed by Capt. 1982.

Perez. Liwanag. Saguindel was heard saying. they waived their right to counsel. Liwanag and Mateo admitted their participation and implicated petitioner in the crime. Ferrer submitted an after-operations report about their mission and executed jointly with Lt. ito yong baril na nagamit. on the other hand. Pagdilao on affidavit on the same matter. “Hindi na kami interesado.”*32+ The three suspects were brought to Camp Crame for further investigation.”*30+ With Miravalles and Saguindel. Saguindel voluntarily accepted the invitation to proceed to the SOG headquarters. returned with a .32 caliber revolver with six bullets[31] and said. “Sir. Capt.[33] Aside from petitioner. they had a heated altercation. Metro Manila. Mateo and Perez executed sworn statements. Liwanag and Mendoza certified that they voluntarily surrendered vouchers and checks which were . Relator excused himself.as one of their confederates. Ferrer later asked Miravalles to bring him to Eddie Saguindel. When they found him at home.”*29+ Capt. Like petitioner. Capt. Thereafter. went upstairs. ang hihina kasi ng mga loob niyan. Miravalles reacted by saying.[34] Prior to doing so. Mateo and one alias “Buro” during that month of May. Manila to look for Bernardo Relator. Ferrer and his team moved on to Binondo. sir. after Miravalles initially informed him of the facts obtained during the investigation. At the barracks of the Long Range Patrol in Bicutan. denied having driven a Lancer car in the hijacking and stated that he was implicated in the crime only because in one drinking spree with petitioner. eh. sa mga tsekeng iyan kasi isang buwan na hindi pa nabebenta. “Sir.

. For their part.[37] On May 31. During the taking of his statement. petitioner was visited by Jimmy Victorino and another comrade from the General Assignment Section of the WPD. The three recognized and pointed to the suspects in a line-up.[38] Miranda pointed at Frias and Liwanag[39] while Bautista identified Frias. the postal employee implicated.[36] Severino Castro. they also executed waivers under Article 125 of the Revised Penal Code. Saguindel and Miravalles executed a joint affidavit[35] manifesting their option to avail of their right to remain silent until such time as they would have retained a counsel of their choice. when told to identify his alleged cohorts. Bautista and Tagudar and directed them to proceed to Camp Crame. Relator executed a certification to the effect that he voluntarily surrendered his . Relator. 1982. However.[40] Petitioner himself. a former clerk of the Central Post Office and son of a director of the Bureau of Posts in Region I.part of their loot in the hijacking. At the office of the SOG. then Postmaster General Golez summoned postal employees Miranda.32 caliber Smith & Wesson service revolver used in the commission of the crime. petitioner did not manifest that he needed the assistance of counsel. also chose to remain silent as he wanted to testify in court. he linked to the crime a certain Gerardo Escalada. For his part. In spite of the fact that his father-in-law was a lawyer. Tagudar identified Saguindel and Liwanag. they were told to go over some pictures for identification of the culprits. Mendoza and Liwanag . Frias and Mendoza executed a similar joint affidavit.

Sandiganbayan Associate Justice Romeo M. Relator.pointed to Severino Castro as their contact at the post office. Mendoza. Liwanag. Bulacan against petitioner and ten (10) others. Frias. namely.000.[42] On August 8. Perez. SOG Chief Investigator Jorge C.D. Mercado filed a complaint for robberyin-band (hijacking) before the Municipal Court of Meycauyan.[44] The Sandiganbayan denied the motion on January 3. Escareal issued orders for the arrest of the accused[43] and fixed bail at P13. 1983. Castro and Escalada (Criminal Case No. 7885). Saguindel and Relator filed a motion to quash the Information asserting that under the Articles of War and Section 1 of P. they should be tried by a court martial. the Information previously referred to and aforequoted was filed with the Sandiganbayan and docketed as Criminal Case No. 1984[45] on the ground that courts martial could no longer exercise jurisdiction over them by virtue of their separation from military service.00 each. 1983. 8496. Miravalles. Saguindel. Evidence for the Defense . On September 20. Mateo.[41] Five of the suspects who were not identified in the line-up were however implicated by Liwanag. Mateo and petitioner. 1850.

1980 at the Shemberg Marketing Corporation. Mateo visited petitioner at the police headquarters seeking assistance in his bid to lead a new life.[46] He also claimed to have received a loyalty medal for meritorious service above the call of duty[47] and several commendations[48] for the distinguished performance of his duties.000 qualified theft case on May 16.[49] Although a suspect. On that fateful date of May 3. at the Likha Antique and . Mateo proved to be an effective informer. he was the recipient of several awards and recognitions starting with ranking fifth in the Final Order of Merit in the basic course for police officers. he allegedly supplied vital information on the identities and whereabouts of suspects in robbery cases at the La Elegancia Jewelry Store. 1982. 1978 assigned to the Investigation Division or the Detective Bureau of the WPD to which the General Assignment Section belonged. In fact. Mateo was not charged in the information subsequently filed in that case. he was a member of the Special Task Force Unit covering the tourist belt area. petitioner admitted knowing only Martin Mateo whose name appeared in the initial follow-up operation he allegedly participated in regarding a P250.Testifying in his own defense. Of the ten other accused in this case. petitioner readily made him an informer who was paid from time to time out of the police intelligence fund. Considering Mateo’s familiarity with underworld characters. petitioner alleged that as a patrolman since August 21. Sometime in March 1981.

On May 2. Mateo urged petitioner to lend him his jeep in order that he could follow-up a bank robbery case. accused Rodolfo Miranda. petitioner met Mateo and requested the latter to give him a good project as he was working for his transfer to the Metrocom Intelligence Security Group (MISG). petitioner approached his kumpare. About a month prior to May 3. That same evening. to borrow the latter’s old Mercedes Benz since. 1982. In one instance however. Manila where petitioner was to meet his friend Manolo Almoguera who would be celebrating his . Mateo became accustomed to borrowing petitioner’s owner-type jeep whenever he was given an assignment. petitioner from then on refused to lend his jeep to Mateo.[50] and in an alleged racket in Aranque Market in Manila involving jewelries. Cruz. if the jeep was used. petitioner saw Mateo using his jeep with some male companions.Crafts. As such informer. Petitioner advised him to return the car between the hours of two and three in the afternoon at the Lakan Beer House at the corner of Rizal Avenue and Zurbaran Streets in Sta. Instead. Mateo could be identified as an informer. Because Mateo denied the occurrence of the incident.”*51+ Mateo took the Benz in the morning of May 3. 1982. 1982. Mateo was given an allowance to cover his travelling expenses. Petitioner left his jeep with Miranda and “went around boasting of the Mercedes Benz.

birthday there. Manila. Pagdilao to the residence of Miranda to get the Benz. He waited for Mateo until shortly before 5:00 in the afternoon when he was constrained to leave without seeing Mateo because he had to attend a mandatory regular troop formation at 5:00 P. Petitioner then returned the car to Miranda. He returned to the beer house at about 6:00 in the evening hoping to find Mateo and the automobile. petitioner was made to board a car where he was handcuffed. escorted by a group of military men. Tondo. the latter apologized and said that his surveillance bore good results. went to petitioner’s house at 810 Cabezas St. through the latter’s cousin. at the police headquarters. petitioner proceeded to his area of responsibility in the tourist belt. From there. Petitioner went out and scolded Mateo for being late. Wearing only short pants. someone informed him that Mateo had finally arrived. Mateo. At around 11:00 in the evening of May 29.. 1982.[52] Petitioner was then instructed to accompany Lt. When petitioner noticed that they were not heading for Miranda’s . The men asked him about the Benz and the identities of his companions in an alleged hijacking incident.M. Petitioner admitted having knowledge of the exact location of the car but denied participation in the crime. Petitioner met Almoguera and company at around 3:30 in the afternoon. They were on board two cars. The group refused to give any reason for their visit but arrested him. Nobody apprised him of his constitutional rights to remain silent and to be assisted by counsel. A little before 8:00 o’clock.

A check with the CIS yielded . someone blindfolded him from behind. but his request was denied. petitioner repeatedly coaxed to admit participation in the hijacking. As he vehemently denied the accusation against him. Pagdilao however informed him that they would be dropping by petitioner’s house first per the investigator’s information that more checks could be recovered thereat. He sought permission to get in touch with his father-in-law. Atty. Pagdilao. led him outside and loaded him in a car. they proceeded to the house of Miranda who was also invited for questioning. At the SOG headquarters in Camp Crame. An object was tied to his small finger to electrocute him. pleading for pity and thinking that he was about to be “salvaged”. petitioner’s wife reported to the WPD General Assignment Section her husband’s forcible abduction by armed men whom she mistook for CIS agents. He was taken to an unidentified place and made to lie flat on his back. someone from the other car came out of a nearby house owned by Mateo and reported that they had recovered some checks. A warrantless search was then allegedly conducted in petitioner’s house but nothing was found.place. Felix Rosacia. he clutched the hand of Lt. someone mounted his chest and applied the “water cure” (“tinutubig”) through his nose. Suddenly. Because these ordeals were simultaneously carried out. Thereafter. The latter surrendered his Benz to the group. While a wet handkerchief was stuffed in his mouth. petitioner felt unbearable pain. They urged him to cooperate otherwise something terrible would happen to him. Meanwhile. Lt.

Petitioner was therefore constrained to sign the statement because of his excruciating experience (“hirap na hirap”). a prepared statement was shown and read to petitioner. Lagman told petitioner that he thought they had an understanding already. Serrano of the WPD. Later. petitioner refused to sign it. would be liquidated by the SOG. Petitioner revealed to Victorino the maltreatment done him but the latter expressed helplessness about it. He however admitted having read the document before affiixing his signature . After Mateo left. only Jimmy Victorino.[56] should he refused to cooperate.negative results. and a member of the “Contreras gang”. Placing his arm around petitioner. like Pat. Reynaldo Dator went to the SOG where he was informed that petitioner was being investigated but no details were given thereon pending clearance with superior officers.*55+ The advice came after petitioner was warned that he. a newspaper carried an item on the SOG’s refusal to allow petitioner’s co-police officers to see him in his detention cell.[53] Consequently. Victorino advised him to just cooperate so that the SOG would not incriminate him (“para hindi ka pag-initan dito”). Thereafter. In fact. Petitioner later discovered that Lagman was not member of the military but an “agent” of the SOG. Mateo came to petitioner’s cell and confided that he had been similarly maltreated and forced to implicate petitioner. was able to visit him. a certain Capt. formerly of the WPD who was transferred to the SOG. Lt. Because its contents were false.[54] Among his comrades.

On August 4. The waiver under Article 125 of the Revised Penal Code and the certification he executed were allegedly also obtained by duress. Petitioner’s alibi was supported by Manolo Almoguera whose birthday on May 3. Petitioner filed a complaint for grave coercion and maltreatment against Lt. City Fiscal Emelita H. 1995 was the reason for the celebration at the Lakan Beer House. 1956. he did not even know Castro. He implicated Castro because he was threatened by a certain Boy Zapanta. While his baptismal certificate indicated that he was born on May 4. the owner of the beer house.[58] a joint affidavit[59] also attested that his birth date was actually May 3. corroborated Almoguera’s testimony as to petitioner’s alleged presence during the birthday celebration. 1956.[57] However.thereto and initialing the corrections therein. petitioner swore that he never received the subpoenas. The Respondent Court’s Decision . Although he picked out one Severino Castro in a police line-up. Rosendo Ferrer and several John Does. Garayblas recommended its dismissal for petitioner’s failure to appear despite subpoenas and to answer clarificatory questions as well as to authenticate his statement. Asst. 1982. Gary Gallardo.

which are the . the dispositive portion of which reads: “WHEREFORE. for insufficiency of evidence. 532. Consequently. Revolver. ONE (1) MONTH and ELEVEN (11) DAYS as maximum. Jr. the Sandiganbayan rendered the herein questioned 51-page Decision. Jr. Martin Mateo. Jr. it is hereby ordered that Exhibits B. its . to THIRTEEN (13) YEARS. No civil indemnity is hereby awarded due to the complete dearth of any proof as to the actual damages suffered by the Bureau of Posts or the owners of the pilfered mail matters.32 Cal. with costs de oficio. Serial No. 11707. judgment is hereby rendered finding accused Jose Filoteo. as well as most of the checks and warrants which were surrendered by some of the accused. Accused Danilo Miravalles y Marcelo is hereby acquitted. Smith and Wesson. Bernardo Relator. 1987.On June 18. y Mijares. and it further appearing that the mail van which was hijacked had been recovered. both of reclusion temporal. B-1 and B-2. and to pay their proportionate share of the costs of the action. y Diendo. otherwise known as the Anti-Piracy and Anti-Highway Robbery Law of 1974 and hereby sentences each of said accused to suffer the indeterminate penalty ranging from TWELVE (12) YEARS and ONE (1) DAY as minimum. in relation to Section 3 (b) of Presidential Decree No. without prejudice to the institution of the proper civil action to recover damages should proof thereof be available. y Retino and Eddie Saguindel y Pabinguit GUILTY as co-principals beyond reasonable doubt of the violation of Section 2 (e).

1987. respectively. The Issues . Metro Manila and the Commanding General and Chief.” Petitioner’s motion for reconsideration of said Decision was denied by the Sandiganbayan in its challenged Resolution of July 27. Central Post Office. which were surrendered by accused Relator. Quezon City for their information and guidance with respect to the other accused who are still at-large. Quezon City and the Social Security System. 194 and 22 pieces. J-1 to J-5. of Social Security System and Medicare checks and vouchers. be returned to the Firearm and Explosive Unit (FEU). the instant alternative petition for certiorari and/or review on certiorari charging the Sandiganbayan with having gravely abused its discretion amounting to lack or excess of jurisdiction and with reversible error in arriving at said Decision. PC. SO ORDERED. and Exhibits J. PC-INP. 222. Let copies of this decision be furnished the Postmaster-General. Liwasang Bonifacio. 215. respectively. 197. Camp Crame. Hence. consisting of 187. Camp Crame.holster and six (6) live ammunition respectively. upon proper receipts.

Second The respondent court erred and gravely abused its discretion as well as exceeded its jurisdiction in finding that petitioner’s having .The amended petition raises the following: “Assignments of Error and / or Excess of Jurisdiction / Grave Abuse of Discretion xxx xxx xxx First The respondent court erred and gravely abused its discretion as well as exceeded its jurisdiction when it made its determination of the alleged guilt of petitioner on the basis of mere preponderance of evidence and not proof beyond reasonable doubt.

borrowed the Mercedes Benz car utilized by the other accused in the hijacking of the mail van idubitably established his direct participation and/or indispensable cooperation in the said hijacking. absolutely without any basis in the evidence and in fact contrary to the prosecution’s only evidence that has some measure of competency and admissibility. Third The respondent court erred and gravely abused its discretion as well as exceeded its jurisdiction in finding that the voluminous SSS Medicare and Pension Checks were confiscated from and surrendered by petitioner and three of the other accused and in finding the testimonies and investigation reports relative thereto. said findings being absolutely without any support in the evidence. the same being in gross disregard of basic Rules of Law. said findings being. insofar as petitioner is concerned. Fourth The respondent court erred and gravely abused its discretion in finding that dorsal portions of the checks and warrants allegedly taken from petitioner were signed by him to indicate his admission of accountability therefor and that his signatures thereon confirm the confiscation from and/or surrender by him of said checks. ‘credible and unrefuted’. .

maltreatment. his request for which was refused. in gross violation of Constitutional Provisions and the prevailing jurisprudence. .Fifth The respondent court erred and gravely abused its discretion as well as exceeded its jurisdiction in admitting and considering against petitioner his alleged extra judical confession. Sixth The respondent court erred and gravely abused its discretion as well as exceeded its jurisdiction in finding that petitioner’s participation in the hijacking of the mail van is indubitably established ‘by the manner by which the SOG operatives succeeded in ferreting out the members of the hijacking syndicate one by one through patient sleuthing’ and in finding that they did so ‘without resorting to extra-legal measures’ and that ‘no evidence having been adduced to show that they were actuated by improper motives to testify falsely against the herein accused. physical compulsion. despite petitioner’s uncontradicted testimony and documentary proof that he was made to give or sign the same through torture. then their testimonies should be accorded full credence’. threats and intimidation and without the presence and assistance of counsel.

x x x substantial and sufficient evidence exist which indubitably prove the guilt of Filoteo’ (Petitioner). The truth of the matter being that they should have been sustained . the respondent court erred and gravely abused its discretion as well as exceeded its jurisdiction in finding that ‘accused Filoteo’s (petitioner’s) and Mateo’s *alleged+ unexplained possession of the stolen checks raised the presumption that ‘they were responsible for the robbery in question’. Mateo and Liwanag.Seventh The respondent court erred and gravely abused its discretion as well as exceeded its jurisdiction in finding that ‘even setting aside the inter-locking confessional statements of Filoteo. Eight Insofar as petitioner is concerned. Ninth The respondent court erred and gravely abused its discretion as well as exceeded its jurisdiction in finding that ‘accused Filoteo’s denials and alibi cannot be entertained for being quite weak and implausible’. petitioner’s alleged possession not being borne out but disputed by the prosecution’s own evidence.

Eleventh The respondent Court erred and gravely abused its discretion as well as exceeded its jurisdiction in cavalierly rejecting.” . through the use of pejorative words. in gross violation of the express mandate of the 1987 Constitution. the various vital factual points raised by petitioner. during and after the commission of the offense. and without stating the legal basis of such rejection. Tenth The respondent court erred and gravely abused its discretion as well as exceeded its jurisdiction in finding that the participation of petitioner in the criminal conspiracy has been proven beyond reasonable doubt by the evidence of record and that said evidence ‘not only confirms the conspiracy between *him and the other accused] as easily discernible from their conduct before. but also their participation therein as co-principals by direct participation and/or indispensable cooperation’.since petitioner was not identified by the direct victims-eyewitnesses as among those who participated in or were present at the hijack and none of the checks and treasury warrants were found in his possession or retrieved from him.

The Court believes that the above “errors” may be condensed into four: (1) Are the written statements. particularly the extra-judicial confession executed by the accused without the presence of his lawyer. duress. maltreatment and intimidation and therefore illegal and inadmissible? (3) Was petitioner’s warrantless arrest valid and proper? (4) Is the evidence of the prosecution sufficient to find the petitioner guilty beyond reasonable doubt? The Court’s Ruling Preliminary Issue: Rule 45 or Rule 65? . admissible in evidence against him? (2) Were said statements obtained through torture.

findings of fact of the Sandiganbayan are not to be reviewed by this Court in a petition for review on certiorari. Petitioner. . which created the Sandiganbayan. Sandiganbayan.” However. In Jariol. of course. opted to file an (amended) “alternative petition” for certiorari under Rule 65 and for review on certiorari under Rule 45 of the Rules of Court. in exceptional cases. a “segurista”. No.D. in Section 2. reading petitioner’s Petition for Review and Memorandum in the most favorable possible light. 1606 expressly provides that “(d)ecisions and final orders of the Sandiganbayan shall be appealable to the Supreme Court by petition for review on certiorari raising pure questions of law in accordance with Rule 45 of the Rules of Court.” As amended by Republic Act No. as amended by P.D. Thus. Section 7 of P. 1606. And Rule 45 of the Revised Rules of Court provides. We however hold that the instant petition must be considered as one for review on certiorari under Rule 45. Here. it is necessary to dwell on the procedural aspects of the case.Before ruling on the foregoing issues. 1486. vs. No. certain exceptions to this general principle. petitioner may be seen to be in effect asserting that the Sandiganbayan misapprehended certain (f)acts in arriving at its factual conclusions. specified that decisions and final orders of the Sandiganbayan shall be subject to review on certiorari by this Court in accordance with Rule 45 of the Rules of Court.[60] this Court clearly ruled: “Presidential Decree No. Jr. in principle. 7975. There are. that only questions of law may be raised in the Petition for Review and these must be distinctly set forth.

In all criminal cases.this Court has taken cognizance of questions of fact in order to resolve legal issues. as where there was palpable error or grave misapprehension of facts by the lower court. petitioner could have lost this battle through a summary dismissal of his “alternative” petition. threats and intimidation and without the . First Issue: Uncounselled Waiver On the merits of the petition. a person’s life and liberty are at stake. Petitioner contends that respondent Court erred in admitting his extrajudicial confession notwithstanding uncontradicted testimony and documentary proof that he was made to sign the same through torture. For waffling on procedural matters. physical compulsion. Criminal cases elevated by convicted public officials from the Sandiganbayan deserve the same thorough treatment by this Court as criminal cases involving ordinary citizens simply because the constitutional presumption of innocence must be overcome by proof beyond reasonable doubt. a petition for certiorari under Rule 65 would not prosper. Basic it is that certiorari is invocable only where there is no other plain. we find that the pivotal issue here is the admissibility of petitioner’s extrajudicial confession which lays out in detail his complicity in the crime. maltreatment. the Court decided to take cognizance of the matter. But in view of the importance of the issues raised.*61+ As a petition for review under Rule 45 is the available remedy. speedy or adequate remedy.

He also claims that in executing the extrajudicial confession. Section 12 of the 1987 Constitution are.” In comparison. as follows: . or any other means which vitiates the free will shall be used against him. Any confession obtained in violation of this section shall be inadmissible in evidence. The pertinent provision of Article IV. he was denied the right to counsel in the same way that his waiver of the said right was likewise without the benefit of counsel. inter alia. Any person under investigation for the commission of an offense shall have the right to remain silent and to counsel and to be informed of such rights.” We shall first tackle the issue of his uncounselled waiver of his right to counsel.presence and assistance of counsel. violence. threat. intimidation. Petitioner therefore questions the respondent Court’s admission in evidence of his extrajudicial confession on the strength of cases[62] upholding the admissibility of extrajudicial confessions notwithstanding the absence of counsel “especially where the statements are replete with details and circumstances which are indicative of voluntariness. Section 20 of the 1973 Constitution reads as follows: “No person shall be compelled to be a witness against himself. the relevant rights of an accused under Article III. No force.

[63] the Court categorically held that the aforequoted provisions of the 1973 . These rights cannot be waived except in writing and in the presence of counsel. Article III of the 1987 Constitution. the 1973 Constitution did not contain the right against an uncounselled waiver of the right to counsel which is provided under paragraph 1.) In the landmark case of Magtoto vs. (4) The law shall provide for penal and civil sanctions for violations of this section as well as compensation to and rehabilitation of victims of torture or similar practices and their families. If the person cannot afford the services of counsel. Secret detention places. threat. Manguera.“(1) Any person under investigation for the commission of an offense shall have the right to be informed of his right to remain silent and to have competent and independent counsel preferably of his own choice. (2) No torture. force. he must be provided with one. violence. Section 12. (3) Any confession or admission obtained in violation of this or Section 17 hereof shall be inadmissible in evidence against him. incommunicado. or other similar forms of detention are prohibited. or any other means which vitiate the free will shall be used against him. solitary. above underscored. Obviously.” (underscoring supplied. intimidation.

Consequently.” By parity of reasoning.[64] the definitive ruling was . This Court said: “We hold that this specific portion of this constitutional mandate has and should be given a prospective and not a retrospective effect. and even if he had not been informed of his right to counsel. Accordingly. 1973. Although a number of cases held that extrajudicial confessions made while the 1973 Constitution was in force and effect. if the same had been obtained before the effectivity of the New Constitution. be admissible. is inadmissible in evidence if the same had been obtained after the effectivity of the New Constitution on January 17. Conversely. the specific provision of the 1987 Constitution requiring that a waiver by an accused of his right to counsel during custodial investigation must be made with the assistance of counsel may not be applied retroactively or in cases where the extrajudicial confession was made prior to the effectivity of said Constitution. since no law gave the accused the right to be so informed before that date. by such argumentation. 1973. a confession obtained from a person under investigation for the commission of an offense. such confession is admissible in evidence against the accused.Constitution (which were not included in the 1935 Charter) must be prospectively applied. even if presented after January 17. who has not been informed of his right (to silence and) to counsel. waivers of the right to counsel during custodial investigation without the benefit of counsel during the effectivity of the 1973 Constitution should. should have been made with the assistance of counsel.

Jr. The court specifically ruled that “(t)he right to counsel may be waived but the waiver shall not be valid unless made with the assistance of counsel. petitioner may not claim the benefits of the Morales and Galit rulings because he executed his extrajudicial confession and his waiver to the right to counsel on May 30. 1983. While the Morales-Galit doctrine eventually became part of Section 12(1) of the 1987 Constitution. in People vs. 1982. Feliciano vigorously taught: “x x x. that doctrine affords no comfort to appellant Luvendino for the requirements and restrictions outlined in Morales and Galit have no retroactive effect and do not reach waivers made prior to 26 April 1983 the date of promulgation of Morales. Justice Florentino P. or before April 26. Enrile and reiterated on 20 March 1985 in People vs. Luvendino. Court of Appeals[68] where the Court ruled thru Chief Justice Andres R.. The prospective application of “judge-made” laws was underscored in Co vs. 1983 when this Court. Galit. Narvasa that in accordance with Article 8 of the Civil Code which provides that “(j)udicial decisions . x x x.enunciated only on April 26.” Pursuant to the above doctrine. through Morales.[65] issued the guidelines to be observed by law enforcers during custodial investigation. The doctrine that an uncounseled waiver of the right to counsel is not to be given legal effect was initially a judge-made one and was first announced on 26 April 1983 in Morales vs.[67] the Court through Mr.”*66+ Thereafter. vs. Enrile.

” what is being construed here is a constitutional provision specifically contained in the Bill of Rights which is obviously not a penal statute. a penal law denotes punishment imposed and enforced by the state for a crime or offense against its law. original or amendatory.” the principle of prospectivity of statutes. cannot be sustained. Section 12 of the 1987 Constitution should be given retroactive effect for being favorable to him as an accused. A bill of rights is a declaration and enumeration of the individual rights and privileges which the Constitution is designed to protect against violations by the government. shall apply to judicial decisions. are nevertheless evidence of what the law means. While Article 22 of the Revised Penal Code provides that “(p)enal laws shall have a retroactive effect insofar as they favor the person guilty of a felony who is not a habitual criminal.[70] Penal laws.applying or interpreting the laws or the Constitution shall form part of the legal system of the Philippines. It is a charter of liberties for the individual and a limitation upon the power of the state. although in themselves are not laws.[71] .[69] Petitioner’s contention that Article III.” and Article 4 of the same Code which states that “(l)aws shall have no retroactive effect unless the contrary is provided. or by individuals or groups of individual. on the other hand. In other words. strictly and properly are those imposing punishment for an offense committed against the state which the executive of the state has the power to pardon. which.

bagama’t ako ay inalok ng mga imbestigador na ikuha ng isang abugadong walang bayad mula sa CLAO-IBP na akin namang tinanggihan: . petitioner’s vigorous reliance on People vs. Camp Crame. the Court has still to determine whether such waiver was made voluntarily and intelligently. 1983. 1982 waiving the provisions of Article 125 of the Revised Penal Code. 1983. Sison*72+ to make his extrajudicial confession inadmissible is misplaced. PC/INP Central Anti-Organized Crime Task Force.[76] petitioner stated that: “x x x matapos akong mapagpaliwanagan ng mga imbestigador ng Special Operations Group. The admissibility of petitioner’s uncounselled waiver of the right to counsel notwithstanding. the extrajudicial confession was executed on May 19.[75] In his affidavit of May 30.[73] The waiver must also be categorical and definitive. Article IV ng Bagong Saligang Batas ng Republika ng Pilipinas ay malaya at kusang-loob na nagsasalaysay ng mga sumusunod kahit na walang abugadong magpapayo sa akin sa pagsasagawa nito sa dahilang alam at nauunawaan ko ang aking ginagawa at wala naman akong isasalaysay kung hindi mga katotohanan lamang.Hence.[74] and must rest on clear evidence. clearly after the promulgation of Morales on April 26. In that case. Quezon City ng aking mga karapatan alinsunod sa mga isinasaad ng Section 20.

testified that he apprised petitioner of his right to counsel even in waiving the same right[77] but petitioner did not even inform him that his father-in-law was a lawyer. petitioner did not invoke his right to counsel. Arsenio Carlos.[80] in other words.” Sgt. Although allowed to talk for thirty minutes with Jimmy Victorino. with stints at the investigation division or the detective bureau.xxx xxx x x x. Na ako ay hindi sinaktan o minaltrato gayunding walang kinuha mula sa akin na hindi niresibohan. He was a fourth year criminology student and a topnotch student in the police basic course.[79] Having been in the police force since 1978. xxx xxx x x x. he knew the tactics used by investigators to incriminate criminal suspects. he was knowledgeable on the matter of extrajudicial confessions. It should be emphasized that petitioner could not have been ignorant of his rights as an accused. who was his comrade at the WPD General Assignment Section. investigating officer. The Second Issue: Confession Extracted Through Torture? .[78] still.

there is no reason to maltreat him in particular when the record shows that the investigating team respected the right of the other suspects to remain silent. extrajudicial confession and waiver of detention. As correctly observed by the Solicitor General. In view of the foregoing. The allegation of torture was negated by the medical report[81] showing no evidence of physical injuries upon his person. no handwriting expert is needed to declare that petitioner’s signatures were written voluntarily and not under compulsion of fear immediately after he had been subjected to maltreatment. Furthermore. When he was presented before Judge Mariano Mendieta of the municipal court in Meycauayan. his extrajudicial confession is presumed to have been voluntarily made. petitioner even waived his right to present evidence[82] instead of impugning his confession on account of the torture allegedly inflicted upon him. or at least susceptible to serious doubts. in the absence of conclusive . In the present case. he would have revived the case he filed against his alleged torturers upon learning of its dismissal.Petitioner’s claim that he was tortured into signing the confession appears incredible. Human experience has proven that the lines and strokes of a person’s handwriting reflect his disposition at a certain given time. an examination of his signatures in the different documents on record bearing the same discloses an evenness of lines and strokes in his penmanship which is markedly consistent in his certification. If indeed he had been tortured.

the findings of which are binding on this Court whose function. we have pored over the assailed Decision and we are satisfied that respondent Court performed its duty in evaluating the evidence.:[85] “Finally.evidence showing that petitioner’s consent in executing the same had been vitiated. this Court explained in People vs. Lopez. as afore-discussed. he pleaded not guilty upon arraignment. Moreover. On this point. stating that the arresting officers “invited” him without a warrant of arrest and brought him to Camp Crame where he was allegedly subjected to torture almost a month after the commission of the crime. When accused-appellant was arrested and a case was filed against him. The Third Issue: Illegal Arrest? Petitioner questions the manner of his arrest. is principally to review only of questions of law. the question of whether petitioner was indeed subjected to torture or maltreatment is a factual question addressed primarily to trial courts. Jr. participated in the trial and presented his evidence. He should have questioned the validity of his arrest before he entered his plea in the trial court. More on this later. Appellant is thus .[84] Petitioner’s claim is belatedly made. it is much too late for appellant to raise the question of his arrest without a warrant.[83] Besides.

otherwise the objection is deemed waived. He . he did not lift a finger to revive it upon its dismissal. He borrowed a car to use in the hijacking knowing fully well that his owner-type jeep would give away his identity. his culpability has been proven beyond reasonable doubt. The Fourth Issue: Sufficiency of the Prosecution’s Evidence Contrary to petitioner’s claim. However. the illegal arrest of an accused is not sufficient cause for setting aside a valid judgment rendered upon a sufficient complaint after trial free from error. 82-12684 before the Fiscal’s Office of Quezon City.S. No. as stated above. this issue is being raised for the first time by appellant. It is well-settled that any objection involving a warrant of arrest or procedure in the acquisition by the court of jurisdiction over the person of an accused must be made before he enters his plea. Moreover.” The only move petitioner made in regard to his arrest was to file a complaint for “grave coercion. Consequently. was cured when he voluntarily submitted himself to the jurisdiction of the trial court by entering a plea of not guilty and by participating in the trial.estopped from questioning the legality of his arrest.[86] The complaint was an offshoot of his alleged maltreatment in the hands of the SOG upon his arrest. if any. Besides. any irregularity attendant to his arrest. He did not move for the quashal of the information before the trial court on this ground. grave threat & maltreatment” which was docketed as I.

could be negotiated during that time in approximately thirty (30) minutes. he gave up driving the Mercedes Benz where the postal employees were made to ride. he had entrusted them to his “kumare”. Bulacan and downtown Manila where petitioner claimed to have been at the crucial time was between fifteen (15) to twenty (20) kilometers. which. Arsenio Carlos that his share of the checks were in the possession of his “kumare” in the neighborhood. this Court holds that the full force of the totality of the prosecution’s evidence proves his guilt well beyond reasonable doubt. it is beyond dispute that petitioner was a direct participant in the commission of the crime. and commandeered the van. That the checks were not found in his own home is of no moment. It was petitioner himself who led the team of Lt. Pagdilao back to his place after he had admitted to Sgt. through first-class roads.[87] In view of these facts. It could not therefore have been physically impossible for him to be at the crime scene or its immediate vicinity when the crime was committed.could not be identified by the postal employees in the postal van simply because after overtaking said vehicle and forcing its driver to pull over. The distance between Kalvario.[88] Having already ruled on the admissibility of petitioner’s confession. Before the arrest and upon learning that the authorities had begun to nail down the identities of the malefactors. Weighing heavily against the defense is the well-settled doctrine that findings of . His alibi has been correctly considered by the Sandiganbayan to be weak and implausible. Meycauayan.

facts of the trial courts -. unless there appears in the record some fact or circumstance of weight and influence which has been overlooked or the significance of which has been misapprehended or misinterpreted. Dominguez. “x x x It is well-settled that this Court will not interfere with the judgment of the trial court in passing on the credibility of the witnesses. the Sandiganbayan itself -particularly in the assessment of the credibility of witnesses. The reason for this is that the trial court is in a better position to decide the question. is binding upon this Court.”*90+ So overwhelming is the prosecution’s evidence that respondent Court opined that even without the “inter-locking confessions of Filoteo. They heard the witnesses themselves and observed their deportment and manner of testifying.in this case. 217 SCRA 170). x x x.”*89+ “The doctrine is firmly settled that the trial court’s conclusion on issues of credibility is accorded with highest respect by the appellate courts (People vs. Appellate courts will generally respect the findings of trial courts on the credibility of witnesses since trial courts are in a better position to weigh conflicting testimonies. having heard the witnesses themselves and observed their deportment and manner of testifying during the trial. . abuse or palpable error. absent any arbitrariness.

without a satisfactory explanation of his . which firearm was identified by prosecution witnesses Miranda and Bautista. namely. All three (3) accused. Saguindel was identified in line-ups at the SOG office as the suspect clad in fatigue uniform and carrying an Armalite rifle by prosecution witnesses Tagudar and Bautista.Mateo and Liwanag” the remaining evidence would still be sufficient for conviction. Liwanag and Mendoza. Relator. Relator and Saguindel also jumped bail during the trial and did not offer any evidence to refute the evidence presented by the prosecution against them. even setting aside the inter-locking confessional statements of Filoteo. Moreover. not the owner. Filoteo was responsible for securing the use of the Mercedes Benz car used by the co-conspirators in the hi-jacking. Such flight to evade prosecution constitutes an implied admission of guilt. he surrendered voluminous assorted checks which were part of the loot. Relator admitted that his service firearm was used by him in the hi-jacking. Mateo. As above-stated. Together with Mateo. It is a rule established by an abundance of jurisprudence that when stolen property is found in the possession of one. Mateo and Liwanag.[91] Said the respondent tribunal: “However. we are of the considered opinion that substantial and sufficient evidence exist which indubitably prove the guilt of Filoteo. Mateo and Saguindel who had submitted themselves to the jurisdiction of this Court. accused Filoteo’s and Mateo’s unexplained possession of the stolen checks raises the presumption that they were responsible for the robbery in question.

he tried to show through his witnesses Gary Gallardo and Manolo Almogera that he was with them between 3:00 o’clock to 4:45 o’clock p.possession. to 11:00 o’clock of the same date. This rule is in accordance with the disputable presumption “that a person found in possession of a thing taken in the doing of a recent wrongful act is the taker and doer of the whole act. the period from the time the mail van was hi-jacked up to when postal employees Bautista. and Avenida Rizal between 2-3:00 o’clock p. appears to be incredible and fantastic. 1982. Carlos and by accused’s own signatures at the back of said checks. Ferrer and Sgt. His claim that he merely borrowed the Mercedes Benz car from Rodolfo Miranda to help out his co-accused Mateo.m. he will be presumed the thief. then from 6:00 o’clock to 8:30 o’clock p. said accused has not given such satisfactory explanation.m.m.. finally.m. It was through said witnesses that he tried to establish his whereabouts between 4:30 o’clock to 7:30 o’clock p. from 10:45 o’clock p.m. Miranda and Tagudar were brought to . and. when Mateo failed to show up. he waited at the corner of Zurbaran St. 1982. much more so when their possession had been positively established by the testimonies of prosecution witnesses Capt.” In the instant case. Furthermore. of May 2. Thereafter. accused Filoteo’s denials and alibi cannot be entertained for being quite weak and implausible. of the same day and then went to the WPD headquarters to attend the police formation at around 5:00 o’clock p. He also claimed that he could not have participated in the hi-jack because after giving the car to Mateo in the morning of May 2.m. who had been utilized by the police as an “informer” and was following up tips in certain unsolved cases.

Relator and Saguindel in the criminal conspiracy have (sic) been proved beyond reasonable doubt by the evidence on record and which evidence not only confirms the existence of the conspiracy between them as easily discernible from their conduct before. We take judicial notice that the distance between the crime scene and downtown Manila is some 15-20 kilometers and negotiable over first-class roads in some thirty (30) minutes. and each of the participants are responsible for what the others did in all the stages of execution of the offense.” We are likewise convinced that there is sufficient evidence of conspiracy as convincing as the evidence of the participation of each of the accused. Hence. Mateo. Such alibi.” Final Question: Brigandage or Robbery? . however. the act of one is the act of all.Caloocan City and freed by their captors. but also their participation therein as coprincipals by direct participation and/or indispensable cooperation. Their concerted efforts were performed with closeness and coordination indicating their common purpose. during and after the commission of the offense. As ratiocinated in the assailed Decision:[92] “The participation of accused Filoteo. fails to show that it was physically impossible for him to be present at the scene of the hi-jacking. there being collective criminal responsibility.

articles or property or both”. In fact. highway and bridges or any part thereof. petitioner should have brought up such question as it may benefit him with a reduced penalty. or railway or railroad within the Philippines.The Court believes that. the question of which law was violated by the accused should be discussed and passed upon. the offense is committed on a “Philippine Highway” which under Section 2 (c) thereof has been defined as “any road. The respondent Court convicted the accused of brigandage punishable under Presidential Decree No. used by persons or vehicles. or locomotives or trains for the movement or circulation of persons or transportation of goods. street. passage. 532. though not raised as an issue and though not argued by the parties in their pleadings. 532. extortion or other unlawful purposes or the taking away of property of another by means of violence against or intimidation of persons nor force upon . while under Section 2 (e) thereof “Highway Robbery/Brigandage” has been defined as the “the seizure of any person for ransom. otherwise known as the Anti-Piracy and Anti-Highway Robbery Law of 1974. with respect to the highway robbery aspect. the assailed Decision ratiocinates: “Accused herein are charged with the violation of Presidential Decree No.[93] Justifying the above disposition. Under said decree.

” (Underscoring in the original text. with the attendant use of force.things or other unlawful means. was hi-jacked along the national highway in Bulacan by the accused. violence and intimidation against the three (3) postal employees who were occupants thereof. Accordingly.[94] where it was ruled in unmistakable language that it takes more than the situs of . ergo. Therein. must have been the statute violated. it was conclusively proven that a postal van containing mail matters. otherwise known as the Anti-Piracy and Anti-Highway Robbery Law of 1974.) Obviously. all the essential requisites to constitute a consummated offense under the law in point are present. Presidential Decree No. (Underscoring supplied) The offense described in the information and established by the evidence presented by the prosecution properly falls within the ambit of the aforesaid special law. Such reasoning has already been debunked by this Court in the case of People vs. including checks and warrants. committed by any person on any Philippine Highway”. 532. Isabelo Puno. policeman (sic) and private individuals in conspiracy with their coaccused Castro and Escalada who were postal employees and who participated in the planning of the crime. resulting in the unlawful taking and asportation of the entire van and its contents consisting of mail matters. Also the evidence further showed that the crime was committed by the accused who were PC soldiers. the Court a quo labored under the belief that because the taking or robbery was perpetrated on a national highway (McArthur Highway).

306. but only robbery. Simply because robbery was committed by a band of more than three armed persons. Justice Florenz D. Regalado: “The following salient distinctions between brigandage and robbery are succinctly explained in a treatise on the subject and are of continuing validity: ‘The main object of the Brigandage Law is to prevent the formation of bands of robbers.’ (Italics ours. etc. 306. It would not be necessary to show. 306.the robbery to bring it within the ambit of PD 532. if robbery is committed by a band. the crime would not be brigandage. Said the Court through Mr. whose members were not primarily organized for the purpose of committing robbery or kidnapping.. Such formation is sufficient to constitute a violation of art. 306. it is required that the band ‘sala a los campos para dedicarse a robar. The heart of the offense consists in the formation of a band by more than three armed persons for the purpose indicated in art.) . In the Spanish text of art. it would not follow that it was committed by a band of brigands. that a member or members of the band actually committed robbery or kidnapping or any other purpose attainable by violent means. On the other hand. in a prosecution under it. The crime is proven when the organization and purpose of the band are shown to be such as are contemplated by art.

in creating and promulgating Presidential Decree No. indiscriminate highway robbery. order and tranquility of the nation and stunting the economic and social progress of the people: . If the purpose is only a particular robbery. The martial law legislator. there being no indication to the contrary.In fine. the crime is only robbery. that Presidential Decree No. This conclusion is buttressed by the rule on contemporaneous construction. Further. is evident from the preambular clauses thereof. could not have been unaware of that distinction and is presumed to have adopted the same. 532 for the objectives announced therein. to wit: “WHEREAS. Contemporaneous exposition or construction is the best and strongest in the law. is inter alia. or robbery in band if there are at least four armed participants. thereby disturbing the peace. reports from law-enforcement agencies reveal that lawless are still committing acts of depredation upon the persons and properties of innocent and defenseless inhabitants who travel from one place to another. 532 punishes as highway robbery or brigandage only acts of robbery perpetrated by outlaws indiscriminately against any person or persons on Philippine highways as defined therein. the purpose of brigandage. since it is one drawn from the time when and the circumstances under which the decree to be construed originated. and not acts of robbery committed against only a predetermined or particular victim.

such acts of depredations constitute x x x highway robbery/brigandage which are among the highest forms of lawlessness condemned by the penal statutes of all countries: ‘WHEREAS.” and which single act of depredation would be capable of “stunting the economic and social progress of the people” as to be considered “among the highest forms of lawlessness condemned by the penal statutes of all countries. it is imperative that said lawless elements be discouraged from perpetrating such acts of depredations by imposing heavy penalty on the offenders. social. educational and community progress of the people.” .” and would accordingly constitute an obstacle “to the economic.) Indeed.“WHEREAS. social. (Emphasis supplied. This would be an exaggeration bordering on the ridiculous. with the end in view of eliminating all obstacles to the economic. it is hard to conceive of how a single act of robbery against a particular person chosen by the accused as their specific victim could be considered as committed on the “innocent and defenseless inhabitants who travel from one place to another.” such that said isolated act would constitute the highway robbery or brigandage contemplated and punished is said decree. educational and community progress of the people.

There was also no evidence of any previous attempts at similar robberies by the accused to show the “indiscriminate” commission thereof.[96] The facts alleged therein and proven by the evidence constitute the offense of robbery defined in Art.) * belonging to another were * unlawfully taken by the accused . par. the Information did not specifically mention P. mail. there had been no evidence presented that the accused were a band of outlaws organized for the purpose of “depredation upon the persons and properties of innocent and defenseless inhabitants who travel from one place to another. 294. checks. 295 and punished by Art.[97] From the facts.*95+ Upon the other hand. it is clear that a finding of brigandage or highway robbery involves not just the locus of the crime or the fact that more than three (3) persons perpetrated it.” What was duly proven in the present case is one isolated hijacking of a postal van. etc. It is essential to prove that the outlaws were purposely organized not just for one act of robbery but for several indiscriminate commissions thereof. tools.D. 5. it was duly proven that: * personal property (treasury warrants. all of the Revised Penal Code. 532. In the present case. van. 293 in relation to Art.From the above.

which is. or * by attacking a moving motor vehicle * on a highway. 293) * in an uninhabited place. . 294. or * by an band. the offender shall be punished by the maximum period of the penalty provided under paragraph 5 of Art.* with intent to gain (animo lucrandi) * with intimidation against three persons (Art. “prision correctional in its maximum period to prision mayor in its medium period”. 295) Hence. and * the intimidation was made with the use of firearms (Art.

However. WHEREFORE.Effectively. 293 and 295 and penalized under Art. and GO CHIU.. paragraph 5. the petition is DENIED.R. judgment is hereby rendered finding accused Jose Filoteo. y Diendo GUILTY beyond reasonable doubt as co-principal in the crime of robbery as defined in Arts. Jr. . POLICE POWER CASES G. INC. HOTEL DEL MAR INC. 294. as minimum. 1967 ERMITA-MALATE HOTEL AND MOTEL OPERATORS ASSOCIATION. but the first paragraph of the dispositive portion of the assailed Decision is partially MODIFIED to read as follows: “WHEREFORE. L-24693 July 31. such lighter penalty shall benefit only herein petitioner and not his co-accused who did not contest or appeal the Sandiganbayan’s Decision. the penalty imposed by the Court a quo should be lightened. to ten (10) years of prision mayor as maximum. of the Revised Penal Code Code IMPOSING on him an indeterminate sentence of four (4) years and two (2) months of prision correctional.” All other parts of the disposition are hereby AFFIRMED. No. and to pay his proportionate share of the costs of the action. petitioners-appellees.

1963 by the petitioners.: The principal question in this appeal from a judgment of the lower court in an action for prohibition is whether Ordinance No. FERNANDO. Tenchavez and Associates for intervenor-appellee. one of its members. Panganiban.vs. The lower court held that it is and adjudged it "unconstitutional. The petition for prohibition against Ordinance No. VICTOR ALABANZA. 4760 was filed on July 5. Aruego. J. therefore. there being a failure of the requisite showing to sustain an attack against its validity. and. and a certain Go Chiu. M. THE HONORABLE CITY MAYOR OF MANILA. J. intervenor-appellee. respondent-appellant.. such judgment must be reversed. who is "the president and general manager of the second petitioner" against the respondent Mayor of the City of Manila who was sued in his capacity as such "charged with the . 4760 of the City of Manila is violative of the due process clause. null and void. Abad and Associates Law Office for respondentappellant. Hotel del Mar Inc." For reasons to be more specifically set forth. Ermita-Malate Hotel and Motel Operators Association.

" (par. (par. that Section 1 of the challenged ordinance is unconstitutional and void for being unreasonable and violative of due process insofar as it would impose P6. motel.500.000. employing and giving livelihood to not less than 2. manager. 1963.00 for second class motels. 2). regularly paying taxes. It was then alleged that on June 13. keeper or duly authorized representative of a hotel. After which the alleged grievances against the ordinance were set forth in detail.500 person and representing an investment of more than P3 million. 1). the Municipal Board of the City of Manila enacted Ordinance No. characterized as legitimate businesses duly licensed by both national and city authorities. approved on June 14. It was alleged that the petitioner non-stock corporation is dedicated to the promotion and protection of the interest of its eighteen (18) members "operating hotels and motels. 3). 4760. There was the assertion of its being beyond the powers of the Municipal Board of the City of Manila to enact insofar as it would regulate motels. or lodging house to refrain from entertaining or accepting any guest or customer or letting any room or other quarter to any person or persons without his filling up the prescribed form in a lobby open to public view at all times and . on the ground that in the revised charter of the City of Manila or in any other law. no reference is made to motels.00 fee per annum for first class motels and P4. 1963 by the then Vice-Mayor Herminio Astorga. who was at the time acting as Mayor of the City of Manila."1 (par.general power and duty to enforce ordinances of the City of Manila and to give the necessary orders for the faithful execution and enforcement of such ordinances. that the provision in the same section which would require the owner.

a dining room or. the sex. not only for being arbitrary. motels. unreasonable and oppressive. or the Chief of Police. tavern or common inn unless accompanied by parents or a lawful guardian and making it unlawful for the owner. the length of stay and the number of companions in the room. wherein the surname. or their duly authorized representatives is unconstitutional and void again on due process grounds. that the provision of Section 2 of the challenged ordinance prohibiting a person less than 18 years old from being accepted in such hotels. age and sex would be specified. with data furnished as to his residence certificate as well as his passport number. motels and lodging houses would be open for inspection either by the City Mayor. keeper or duly authorized . given name and middle name. unreasonable or oppressive but also for being vague. coupled with a certification that a person signing such form has personally filled it up and affixed his signature in the presence of such owner.in his presence. relationship. if any. the date of birth. that Section 2 of the challenged ordinance classifying motels into two classes and requiring the maintenance of certain minimum facilities in first class motels such as a telephone in each room. indefinite and uncertain. the nationality. keeper or duly authorized representative. restaurant and laundry similarly offends against the due process clause for being arbitrary. the address. with the name. it also being provided that the premises and facilities of such hotels. the occupation. manager. a conclusion which applies to the portion of the ordinance requiring second class motels to have a dining room. manager. with such registration forms and records kept and bound together. if any. lodging houses. and likewise for the alleged invasion of the right to privacy and the guaranty against self-incrimination.

cause the automatic cancellation of the license of the offended party. runs counter to the due process guaranty for lack of certainty and for its unreasonable. 1963. The lower court on July 6. a valid and proper exercise of the police power and that only the guests or customers not before the court could complain of the alleged invasion of the right to privacy and the guaranty against self . After setting forth that the petition did fail to state a cause of action and that the challenged ordinance bears a reasonable relation. In the a answer filed on August 3. there is once again a transgression of the due process clause. whether on statutory or constitutional grounds. 1963. 1963 issued a writ of preliminary injunction ordering respondent Mayor to refrain from enforcing said Ordinance No. There was a plea for the issuance of preliminary injunction and for a final judgment declaring the above ordinance null and void and unenforceable. 4760 from and after July 8. there was an admission of the personal circumstances regarding the respondent Mayor and of the fact that petitioners are licensed to engage in the hotel or motel business in the City of Manila. and that insofar as the penalty provided for in Section 4 of the challenged ordinance for a subsequent conviction would.representative of such establishments to lease any room or portion thereof more than twice every 24 hours. of the provisions of the cited Ordinance but a denial of its alleged nullity. to a proper purpose. in effect causing the destruction of the business and loss of its investments. arbitrary and oppressive character. which is to curb immorality.

1964. Instead of evidence being offered by both parties.incrimination. respondent Mayor prayed for. 2. That the petitioners are duly licensed to engage in the business of operating hotels and motels in Malate and Ermita districts in Manila. . That the petitioners Ermita-Malate Hotel and Motel Operators Association. all having the capacity to sue and be sued.. both with offices in the City of Manila. That the respondent Mayor is the duly elected and incumbent City Mayor and chief executive of the City of Manila charged with the general power and duty to enforce ordinances of the City of Manila and to give the necessary orders for the faithful execution and enforcement of such ordinances. while the petitioner Go Chin is the president and general manager of Hotel del Mar Inc. there was submitted a stipulation of facts dated September 28. its dissolution and the dismissal of the petition. with the assertion that the issuance of the preliminary injunction ex parte was contrary to law. which reads: 1. are duly organized and existing under the laws of the Philippines. and the intervenor Victor Alabanza is a resident of Baguio City. Inc. and Hotel del Mar Inc. 3.

5. 1963. in the absence of the respondent regular City Mayor. That the explanatory note signed by then Councilor Herminio Astorga was submitted with the proposed ordinance (now Ordinance 4760) to the Municipal Board. v.1äwphï1.05 from license fees paid by the 105 hotels and motels (including herein petitioners) operating in the City of Manila. which was approved on June 14. copy of which is attached hereto as Annex C. then the acting City Mayor of Manila. Such a memorandum likewise refuted point by point the . citing not only U. That the City of Manila derived in 1963 an annual income of P101. 662.4. 6.904. 1963. 1963 (Annex B). 668-b and 669 of the compilation of the ordinances of the City of Manila besides inserting therein three new sections. amending sections 661.S. by Vice-Mayor Herminio Astorga.ñët Thereafter came a memorandum for respondent on January 22. This ordinance is similar to the one vetoed by the respondent Mayor (Annex A) for the reasons stated in its 4th Indorsement dated February 15. the burden of showing its lack of conformity to the Constitution resting on the party who assails it. 4760. wherein stress was laid on the presumption of the validity of the challenged ordinance. 668-a. but likewise applicable American authorities. Salaveria. That on June 13. 1965. the Municipal Board of the City of Manila enacted Ordinance No.

4760 of the City of Manila. the memorandum for petitioners was filed reiterating in detail what was set forth in the petition. and came to the conclusion that "the challenged Ordinance No.arguments advanced by petitioners against its validity. would be unconstitutional and. with the nod of the Court. 1965. agreed to file memoranda and thereafter. the lower court observed: "The only remaining issue here being purely a question of law." Hence this appeal. on February 4. null and void. As noted at the outset. the parties." It does appear obvious then that without any evidence submitted by the parties. therefore. Then barely two weeks later. with citations of what they considered to be applicable American authorities and praying for a judgment declaring the challenged ordinance "null and void and unenforceable" and making permanent the writ of preliminary injunction issued. which are members of the petitioners association. the judgment must be reversed. dismissing as is undoubtedly right and proper the untenable objection on the alleged lack of authority of the City of Manila to regulate motels. After referring to the motels and hotels. A decent regard for constitutional doctrines of a fundamental character ought . to submit the case for decision of the Court." It made permanent the preliminary injunction issued against respondent Mayor and his agents "to restrain him from enforcing the ordinance in question. the decision passed upon the alleged infirmity on constitutional grounds of the challenged ordinance. and referring to the alleged constitutional questions raised by the party.

Its decision cannot be allowed to stand. consistently with what has hitherto been the accepted standards of constitutional adjudication.to have admonished the lower court against such a sweeping condemnation of the challenged ordinance. Primarily what calls for a reversal of such a decision is the absence of any evidence to offset the presumption of validity that attaches to a challenged statute or ordinance. The principle has been nowhere better expressed than in the leading case of O'Gorman & Young v. has in effect given notice that the regulations are essential to the well being of the people x x x . The councilors must. As was expressed categorically by Justice Malcolm: "The presumption is all in favor of validity x x x . by enacting the ordinance. be familiar with the necessities of their particular municipality and with all the facts and circumstances which surround the subject and necessitate action. unless the statute or ordinance is void on its face which is not the case here. the necessity for evidence to rebut it is unavoidable. The local legislative body. Hartford Fire Insurance Co. The Judiciary should not lightly set aside legislative action when there is not a clear invasion of personal or property rights under the guise of police regulation. in the very nature of things.2 It admits of no doubt therefore that there being a presumption of validity.3 where the American Supreme Court through Justice Brandeis tersely and succinctly summed up the matter thus: The statute here questioned . in both procedural and substantive aspects. The action of the elected representatives of the people cannot be lightly set aside..

We are asked to declare it void on the ground that the specific method of regulation prescribed is unreasonable and hence deprives the plaintiff of due process of law."5 It would be. to paraphrase another leading decision. to destroy the very purpose of the state if it could be deprived or allowed itself to be deprived of its competence to promote public health. This particular manifestation of a police power measure being specifically aimed to safeguard public morals is immune from such imputation of nullity resting purely on conjecture and unsupported by anything of substance.deals with a subject clearly within the scope of the police power.6 Negatively put. Nor may petitioners assert with plausibility that on its face the ordinance is fatally defective as being repugnant to the due process clause of the Constitution. insistent and the least limitable of powers. police power is "that . To hold otherwise would be to unduly restrict and narrow the scope of police power which has been properly characterized as the most essential. The mantle of protection associated with the due process guaranty does not cover petitioners." No such factual foundation being laid in the present case. public morals. As underlying questions of fact may condition the constitutionality of legislation of this character.4 extending as it does "to all the great public needs. public safety and the genera welfare. the resumption of constitutionality must prevail in the absence of some factual foundation of record for overthrowing the statute. the presumption of validity must prevail and the judgment against the ordinance set aside. the lower court deciding the matter on the pleadings and the stipulation of facts.

inherent and plenary power in the State which enables it to prohibit all that is hurt full to the comfort, safety, and welfare of society.7

There is no question but that the challenged ordinance was precisely enacted to minimize certain practices hurtful to public morals. The explanatory note of the Councilor Herminio Astorga included as annex to the stipulation of facts, speaks of the alarming increase in the rate of prostitution, adultery and fornication in Manila traceable in great part to the existence of motels, which "provide a necessary atmosphere for clandestine entry, presence and exit" and thus become the "ideal haven for prostitutes and thrill-seekers." The challenged ordinance then proposes to check the clandestine harboring of transients and guests of these establishments by requiring these transients and guests to fill up a registration form, prepared for the purpose, in a lobby open to public view at all times, and by introducing several other amendatory provisions calculated to shatter the privacy that characterizes the registration of transients and guests." Moreover, the increase in the licensed fees was intended to discourage "establishments of the kind from operating for purpose other than legal" and at the same time, to increase "the income of the city government." It would appear therefore that the stipulation of facts, far from sustaining any attack against the validity of the ordinance, argues eloquently for it.

It is a fact worth noting that this Court has invariably stamped with the seal of its approval, ordinances punishing vagrancy and classifying a pimp or procurer as a vagrant;8 provide a license tax for and

regulating the maintenance or operation of public dance halls;9 prohibiting gambling;10 prohibiting jueteng;11 and monte;12 prohibiting playing of panguingui on days other than Sundays or legal holidays;13 prohibiting the operation of pinball machines;14 and prohibiting any person from keeping, conducting or maintaining an opium joint or visiting a place where opium is smoked or otherwise used,15 all of which are intended to protect public morals.

On the legislative organs of the government, whether national or local, primarily rest the exercise of the police power, which, it cannot be too often emphasized, is the power to prescribe regulations to promote the health, morals, peace, good order, safety and general welfare of the people. In view of the requirements of due process, equal protection and other applicable constitutional guaranties however, the exercise of such police power insofar as it may affect the life, liberty or property of any person is subject to judicial inquiry. Where such exercise of police power may be considered as either capricious, whimsical, unjust or unreasonable, a denial of due process or a violation of any other applicable constitutional guaranty may call for correction by the courts.

We are thus led to considering the insistent, almost shrill tone, in which the objection is raised to the question of due process.16 There is no controlling and precise definition of due process. It furnishes though a standard to which the governmental action should conform in order that deprivation of life, liberty or property, in each appropriate case, be valid. What then is the standard of due process

which must exist both as a procedural and a substantive requisite to free the challenged ordinance, or any governmental action for that matter, from the imputation of legal infirmity sufficient to spell its doom? It is responsiveness to the supremacy of reason, obedience to the dictates of justice. Negatively put, arbitrariness is ruled out and unfairness avoided. To satisfy the due process requirement, official action, to paraphrase Cardozo, must not outrun the bounds of reason and result in sheer oppression. Due process is thus hostile to any official action marred by lack of reasonableness. Correctly it has been identified as freedom from arbitrariness. It is the embodiment of the sporting idea of fair play.17 It exacts fealty "to those strivings for justice" and judges the act of officialdom of whatever branch "in the light of reason drawn from considerations of fairness that reflect [democratic] traditions of legal and political thought."18 It is not a narrow or "technical conception with fixed content unrelated to time, place and circumstances,"19 decisions based on such a clause requiring a "close and perceptive inquiry into fundamental principles of our society."20 Questions of due process are not to be treated narrowly or pedantically in slavery to form or phrases.21

It would thus be an affront to reason to stigmatize an ordinance enacted precisely to meet what a municipal lawmaking body considers an evil of rather serious proportion an arbitrary and capricious exercise of authority. It would seem that what should be deemed unreasonable and what would amount to an abdication of the power to govern is inaction in the face of an admitted deterioration of the state of public morals. To be more specific, the Municipal Board of the City of Manila felt the need for a remedial

measure. It provided it with the enactment of the challenged ordinance. A strong case must be found in the records, and, as has been set forth, none is even attempted here to attach to an ordinance of such character the taint of nullity for an alleged failure to meet the due process requirement. Nor does it lend any semblance even of deceptive plausibility to petitioners' indictment of Ordinance No. 4760 on due process grounds to single out such features as the increased fees for motels and hotels, the curtailment of the area of freedom to contract, and, in certain particulars, its alleged vagueness.

Admittedly there was a decided increase of the annual license fees provided for by the challenged ordinance for hotels and motels, 150% for the former and over 200% for the latter, first-class motels being required to pay a P6,000 annual fee and second-class motels, P4,500 yearly. It has been the settled law however, as far back as 1922 that municipal license fees could be classified into those imposed for regulating occupations or regular enterprises, for the regulation or restriction of non-useful occupations or enterprises and for revenue purposes only.22 As was explained more in detail in the above Cu Unjieng case: (2) Licenses for non-useful occupations are also incidental to the police power and the right to exact a fee may be implied from the power to license and regulate, but in fixing amount of the license fees the municipal corporations are allowed a much wider discretion in this class of cases than in the former, and aside from applying the well-known legal principle that municipal ordinances must not be unreasonable, oppressive, or tyrannical, courts have, as a general rule, declined to interfere with such discretion. The desirability of imposing restraint upon the number of

persons who might otherwise engage in non-useful enterprises is, of course, generally an important factor in the determination of the amount of this kind of license fee. Hence license fees clearly in the nature of privilege taxes for revenue have frequently been upheld, especially in of licenses for the sale of liquors. In fact, in the latter cases the fees have rarely been declared unreasonable.23

Moreover in the equally leading case of Lutz v. Araneta24 this Court affirmed the doctrine earlier announced by the American Supreme Court that taxation may be made to implement the state's police power. Only the other day, this Court had occasion to affirm that the broad taxing authority conferred by the Local Autonomy Act of 1959 to cities and municipalities is sufficiently plenary to cover a wide range of subjects with the only limitation that the tax so levied is for public purposes, just and uniform.25

As a matter of fact, even without reference to the wide latitude enjoyed by the City of Manila in imposing licenses for revenue, it has been explicitly held in one case that "much discretion is given to municipal corporations in determining the amount," here the license fee of the operator of a massage clinic, even if it were viewed purely as a police power measure.26 The discussion of this particular matter may fitly close with this pertinent citation from another decision of significance: "It is urged on behalf of the plaintiffs-appellees that the enforcement of the ordinance could deprive them of their lawful occupation and means of livelihood because they can not rent stalls in the public markets. But it appears that plaintiffs are also dealers in

refrigerated or cold storage meat, the sale of which outside the city markets under certain conditions is permitted x x x . And surely, the mere fact, that some individuals in the community may be deprived of their present business or a particular mode of earning a living cannot prevent the exercise of the police power. As was said in a case, persons licensed to pursue occupations which may in the public need and interest be affected by the exercise of the police power embark in these occupations subject to the disadvantages which may result from the legal exercise of that power."27

Nor does the restriction on the freedom to contract, insofar as the challenged ordinance makes it unlawful for the owner, manager, keeper or duly authorized representative of any hotel, motel, lodging house, tavern, common inn or the like, to lease or rent room or portion thereof more than twice every 24 hours, with a proviso that in all cases full payment shall be charged, call for a different conclusion. Again, such a limitation cannot be viewed as a transgression against the command of due process. It is neither unreasonable nor arbitrary. Precisely it was intended to curb the opportunity for the immoral or illegitimate use to which such premises could be, and, according to the explanatory note, are being devoted. How could it then be arbitrary or oppressive when there appears a correspondence between the undeniable existence of an undesirable situation and the legislative attempt at correction. Moreover, petitioners cannot be unaware that every regulation of conduct amounts to curtailment of liberty which as pointed out by Justice Malcolm cannot be absolute. Thus: "One thought which runs through all these different conceptions of liberty is plainly apparent. It is this: 'Liberty' as

understood in democracies, is not license; it is 'liberty regulated by law.' Implied in the term is restraint by law for the good of the individual and for the greater good of the peace and order of society and the general well-being. No man can do exactly as he pleases. Every man must renounce unbridled license. The right of the individual is necessarily subject to reasonable restraint by general law for the common good x x x The liberty of the citizen may be restrained in the interest of the public health, or of the public order and safety, or otherwise within the proper scope of the police power."28

A similar observation was made by Justice Laurel: "Public welfare, then, lies at the bottom of the enactment of said law, and the state in order to promote the general welfare may interfere with personal liberty, with property, and with business and occupations. Persons and property may be subjected to all kinds of restraints and burdens, in order to secure the general comfort, health, and prosperity of the state x x x To this fundamental aim of our Government the rights of the individual are subordinated. Liberty is a blessing without which life is a misery, but liberty should not be made to prevail over authority because then society will fall into anarchy. Neither should authority be made to prevail over liberty because then the individual will fall into slavery. The citizen should achieve the required balance of liberty and authority in his mind through education and personal discipline, so that there may be established the resultant equilibrium, which means peace and order and happiness for all.29

It is noteworthy that the only decision of this Court nullifying legislation because of undue deprivation of freedom to contract, People v. Pomar,30 no longer "retains its virtuality as a living principle. The policy of laissez faire has to some extent given way to the assumption by the government of the right of intervention even in contractual relations affected with public interest.31 What may be stressed sufficiently is that if the liberty involved were freedom of the mind or the person, the standard for the validity of governmental acts is much more rigorous and exacting, but where the liberty curtailed affects at the most rights of property, the permissible scope of regulatory measure is wider.32 How justify then the allegation of a denial of due process?

Lastly, there is the attempt to impugn the ordinance on another due process ground by invoking the principles of vagueness or uncertainty. It would appear from a recital in the petition itself that what seems to be the gravamen of the alleged grievance is that the provisions are too detailed and specific rather than vague or uncertain. Petitioners, however, point to the requirement that a guest should give the name, relationship, age and sex of the companion or companions as indefinite and uncertain in view of the necessity for determining whether the companion or companions referred to are those arriving with the customer or guest at the time of the registry or entering the room With him at about the same time or coming at any indefinite time later to join him; a proviso in one of its sections which cast doubt as to whether the maintenance of a restaurant in a motel is dependent upon the discretion of its owners or operators; another proviso which from their standpoint would require a guess as to

whether the "full rate of payment" to be charged for every such lease thereof means a full day's or merely a half-day's rate. It may be asked, do these allegations suffice to render the ordinance void on its face for alleged vagueness or uncertainty? To ask the question is to answer it. From Connally v. General Construction Co.33 to Adderley v. Florida,34 the principle has been consistently upheld that what makes a statute susceptible to such a charge is an enactment either forbidding or requiring the doing of an act that men of common intelligence must necessarily guess at its meaning and differ as to its application. Is this the situation before us? A citation from Justice Holmes would prove illuminating: "We agree to all the generalities about not supplying criminal laws with what they omit but there is no canon against using common sense in construing laws as saying what they obviously mean."35

That is all then that this case presents. As it stands, with all due allowance for the arguments pressed with such vigor and determination, the attack against the validity of the challenged ordinance cannot be considered a success. Far from it. Respect for constitutional law principles so uniformly held and so uninterruptedly adhered to by this Court compels a reversal of the appealed decision.

Wherefore, the judgment of the lower court is reversed and the injunction issued lifted forthwith. With costs.

lawphil

Today is Saturday, November 17, 2012

Republic of the Philippines SUPREME COURT Manila

EN BANC

G.R. No. L-59234 September 30, 1982

TAXICAB OPERATORS OF METRO MANILA, INC., FELICISIMO CABIGAO and ACE TRANSPORTATION CORPORATION, petitioners, vs. THE BOARD OF TRANSPORTATION and THE DIRECTOR OF THE BUREAU OF LAND TRANSPORTATION, respondents.

MELENCIO-HERRERA, J.:

This Petition for "Certiorari, Prohibition and mandamus with Preliminary Injunction and Temporary Restraining Order" filed by the Taxicab Operators of Metro Manila, Inc., Felicisimo Cabigao and Ace Transportation, seeks to declare the nullity of Memorandum Circular No. 77-42, dated October 10, 1977, of the Board of Transportation, and Memorandum Circular No. 52, dated August 15, 1980, of the Bureau of Land Transportation.

Petitioner Taxicab Operators of Metro Manila, Inc. (TOMMI) is a domestic corporation composed of taxicab operators, who are grantees of Certificates of Public Convenience to operate taxicabs within the City of Manila and to any other place in Luzon accessible to vehicular traffic. Petitioners Ace Transportation Corporation and Felicisimo Cabigao are two of the members of TOMMI, each being an operator and grantee of such certificate of public convenience.

On October 10, 1977, respondent Board of Transportation (BOT) issued Memorandum Circular No. 77-42 which reads:

SUBJECT: Phasing out and Replacement of

Old and Dilapidated Taxis

WHEREAS, it is the policy of the government to insure that only safe and comfortable units are used as public conveyances;

WHEREAS, the riding public, particularly in Metro-Manila, has, time and again, complained against, and condemned, the continued operation of old and dilapidated taxis;

WHEREAS, in order that the commuting public may be assured of comfort, convenience, and safety, a program of phasing out of old and dilapidated taxis should be adopted;

WHEREAS, after studies and inquiries made by the Board of Transportation, the latter believes that in six years of operation, a taxi operator has not only covered the cost of his taxis, but has made reasonable profit for his investments;

NOW, THEREFORE, pursuant to this policy, the Board hereby declares that no car beyond six years shall be operated as taxi, and in implementation of the same hereby promulgates the following rules and regulations:

1. As of December 31, 1977, all taxis of Model 1971 and earlier are ordered withdrawn from public service and thereafter may no longer

be registered and operated as taxis. In the registration of cards for 1978, only taxis of Model 1972 and later shall be accepted for registration and allowed for operation;

2. As of December 31, 1978, all taxis of Model 1972 are ordered withdrawn from public service and thereafter may no longer be registered and operated as taxis. In the registration of cars for 1979, only taxis of Model 1973 and later shall be accepted for registration and allowed for operation; and every year thereafter, there shall be a six-year lifetime of taxi, to wit:

1980 — Model 1974

1981 — Model 1975, etc.

All taxis of earlier models than those provided above are hereby ordered withdrawn from public service as of the last day of registration of each particular year and their respective plates shall be surrendered directly to the Board of Transportation for subsequent turnover to the Land Transportation Commission.

For an orderly implementation of this Memorandum Circular, the rules herein shall immediately be effective in Metro-Manila. Its implementation outside Metro- Manila shall be carried out only after

the project has been implemented in Metro-Manila and only after the date has been determined by the Board. 1

Pursuant to the above BOT circular, respondent Director of the Bureau of Land Transportation (BLT) issued Implementing Circular No. 52, dated August 15, 1980, instructing the Regional Director, the MV Registrars and other personnel of BLT, all within the National Capitol Region, to implement said Circular, and formulating a schedule of phase-out of vehicles to be allowed and accepted for registration as public conveyances. To quote said Circular:

Pursuant to BOT Memo-Circular No. 77-42, taxi units with year models over six (6) years old are now banned from operating as public utilities in Metro Manila. As such the units involved should be considered as automatically dropped as public utilities and, therefore, do not require any further dropping order from the BOT.

Henceforth, taxi units within the National Capitol Region having year models over 6 years old shall be refused registration. The following schedule of phase-out is herewith prescribed for the guidance of all concerned:

Year Model

Automatic Phase-Out Year

1980

1974

1981

1975

1982

1976

1983

1977

etc.

etc.

Strict compliance here is desired. 2

In accordance therewith, cabs of model 1971 were phase-out in registration year 1978; those of model 1972, in 1979; those of model 1973, in 1980; and those of model 1974, in 1981.

On January 27, 1981, petitioners filed a Petition with the BOT, docketed as Case No. 80-7553, seeking to nullify MC No. 77-42 or to

stop its implementation; to allow the registration and operation in 1981 and subsequent years of taxicabs of model 1974, as well as those of earlier models which were phased-out, provided that, at the time of registration, they are roadworthy and fit for operation.

On February 16, 1981, petitioners filed before the BOT a "Manifestation and Urgent Motion", praying for an early hearing of their petition. The case was heard on February 20, 1981. Petitioners presented testimonial and documentary evidence, offered the same, and manifested that they would submit additional documentary proofs. Said proofs were submitted on March 27, 1981 attached to petitioners' pleading entitled, "Manifestation, Presentation of Additional Evidence and Submission of the Case for Resolution." 3

On November 28, 1981, petitioners filed before the same Board a "Manifestation and Urgent Motion to Resolve or Decide Main Petition" praying that the case be resolved or decided not later than December 10, 1981 to enable them, in case of denial, to avail of whatever remedy they may have under the law for the protection of their interests before their 1975 model cabs are phased-out on January 1, 1982.

Petitioners, through its President, allegedly made personal followups of the case, but was later informed that the records of the case could not be located.

On December 29, 1981, the present Petition was instituted wherein the following queries were posed for consideration by this Court:

A. Did BOT and BLT promulgate the questioned memorandum circulars in accord with the manner required by Presidential Decree No. 101, thereby safeguarding the petitioners' constitutional right to procedural due process?

B. Granting, arguendo, that respondents did comply with the procedural requirements imposed by Presidential Decree No. 101, would the implementation and enforcement of the assailed memorandum circulars violate the petitioners' constitutional rights to.

(1) Equal protection of the law;

(2) Substantive due process; and

(3) Protection against arbitrary and unreasonable classification and standard?

On Procedural and Substantive Due Process:

Presidential Decree No. 101 grants to the Board of Transportation the power

4. To fix just and reasonable standards, classification, regulations, practices, measurements, or service to be furnished, imposed, observed, and followed by operators of public utility motor vehicles.

Section 2 of said Decree provides procedural guidelines for said agency to follow in the exercise of its powers:

Sec. 2. Exercise of powers. — In the exercise of the powers granted in the preceding section, the Board shag proceed promptly along the method of legislative inquiry.

Apart from its own investigation and studies, the Board, in its discretion, may require the cooperation and assistance of the Bureau of Transportation, the Philippine Constabulary, particularly the Highway Patrol Group, the support agencies within the Department of Public Works, Transportation and Communications, or any other government office or agency that may be able to furnish useful information or data in the formulation of the Board of any policy, plan or program in the implementation of this Decree.

The Board may also can conferences, require the submission of position papers or other documents, information, or data by operators or other persons that may be affected by the implementation of this Decree, or employ any other suitable means of inquiry.

In support of their submission that they were denied procedural due process, petitioners contend that they were not caged upon to submit their position papers, nor were they ever summoned to attend any conference prior to the issuance of the questioned BOT Circular.

It is clear from the provision aforequoted, however, that the leeway accorded the Board gives it a wide range of choice in gathering necessary information or data in the formulation of any policy, plan or program. It is not mandatory that it should first call a conference or require the submission of position papers or other documents from operators or persons who may be affected, this being only one of the options open to the Board, which is given wide discretionary authority. Petitioners cannot justifiably claim, therefore, that they were deprived of procedural due process. Neither can they state with certainty that public respondents had not availed of other sources of inquiry prior to issuing the challenged Circulars. operators of public conveyances are not the only primary sources of the data and information that may be desired by the BOT.

Dispensing with a public hearing prior to the issuance of the Circulars is neither violative of procedural due process. As held in Central Bank vs. Hon. Cloribel and Banco Filipino, 44 SCRA 307 (1972):

Pevious notice and hearing as elements of due process, are constitutionally required for the protection of life or vested property rights, as well as of liberty, when its limitation or loss takes place in consequence of a judicial or quasi-judicial proceeding, generally dependent upon a past act or event which has to be established or ascertained. It is not essential to the validity of general rules or regulations promulgated to govern future conduct of a class or persons or enterprises, unless the law provides otherwise. (Emphasis supplied)

Petitioners further take the position that fixing the ceiling at six (6) years is arbitrary and oppressive because the roadworthiness of taxicabs depends upon their kind of maintenance and the use to which they are subjected, and, therefore, their actual physical condition should be taken into consideration at the time of registration. As public contend, however, it is impractical to subject every taxicab to constant and recurring evaluation, not to speak of the fact that it can open the door to the adoption of multiple standards, possible collusion, and even graft and corruption. A reasonable standard must be adopted to apply to an vehicles affected uniformly, fairly, and justly. The span of six years supplies that reasonable standard. The product of experience shows that by that time taxis have fully depreciated, their cost recovered, and a fair

return on investment obtained. They are also generally dilapidated and no longer fit for safe and comfortable service to the public specially considering that they are in continuous operation practically 24 hours everyday in three shifts of eight hours per shift. With that standard of reasonableness and absence of arbitrariness, the requirement of due process has been met.

On Equal Protection of the Law:

Petitioners alleged that the Circular in question violates their right to equal protection of the law because the same is being enforced in Metro Manila only and is directed solely towards the taxi industry. At the outset it should be pointed out that implementation outside Metro Manila is also envisioned in Memorandum Circular No. 77-42. To repeat the pertinent portion:

For an orderly implementation of this Memorandum Circular, the rules herein shall immediately be effective in Metro Manila. Its implementation outside Metro Manila shall be carried out only after the project has been implemented in Metro Manila and only after the date has been determined by the Board. 4

In fact, it is the understanding of the Court that implementation of the Circulars in Cebu City is already being effected, with the BOT in

the process of conducting studies regarding the operation of taxicabs in other cities.

The Board's reason for enforcing the Circular initially in Metro Manila is that taxicabs in this city, compared to those of other places, are subjected to heavier traffic pressure and more constant use. This is of common knowledge. Considering that traffic conditions are not the same in every city, a substantial distinction exists so that infringement of the equal protection clause can hardly be successfully claimed.

As enunciated in the preambular clauses of the challenged BOT Circular, the overriding consideration is the safety and comfort of the riding public from the dangers posed by old and dilapidated taxis. The State, in the exercise, of its police power, can prescribe regulations to promote the health, morals, peace, good order, safety and general welfare of the people. It can prohibit all things hurtful to comfort, safety and welfare of society.5 It may also regulate property rights. 6 In the language of Chief Justice Enrique M. Fernando "the necessities imposed by public welfare may justify the exercise of governmental authority to regulate even if thereby certain groups may plausibly assert that their interests are disregarded". 7

In so far as the non-application of the assailed Circulars to other transportation services is concerned, it need only be recalled that the equal protection clause does not imply that the same treatment be

lawphil Today is Saturday. which make for real differences. and that it must apply equally to each member of the class. 2012 Republic of the Philippines . It permits of classification of the object or subject of the law provided classification is reasonable or based on substantial distinction. the Writs prayed for are denied and this Petition is hereby dismissed. It applies to things or persons Identically or similarly situated. Evident then is the conclusion that the questioned Circulars do not suffer from any constitutional infirmity. 9 The challenged Circulars satisfy the foregoing criteria. 10 WHEREFORE.accorded all and sundry. November 17. categorical and undeniable. 8 What is required under the equal protection clause is the uniform operation by legal means so that all persons under Identical or similar circumstance would be accorded the same treatment both in privilege conferred and the liabilities imposed. the infringement of constitutional right must be clear. No costs. To declare a law unconstitutional.

JAIME HERNANDEZ. ICHONG. respondents. Quisumbing. Ozaeta. . Marcial G. Salazar and Associates for petitioner. and MARCELINO SARMIENTO. Office of the Solicitor General Ambrosio Padilla and Solicitor Pacifico P. Serrano for respondent City Treasurer. de Castro for respondent Secretary of Finance. 1957 LAO H. Lichauco and Picazo and Sycip. by Republic Act No. Mendiola as Amicus Curiae. City Fiscal Eugenio Angeles and Assistant City Fiscal Eulogio S. No. vs. L-7995 May 31. Secretary of Finance. Dionisio Reyes as Amicus Curiae. 1180.SUPREME COURT Manila EN BANC G. City Treasurer of Manila. in his own behalf and in behalf of other alien residents. corporations and partnerships adversely affected.R. petitioner.

The case and issue. in general This Court has before it the delicate task of passing upon the validity and constitutionality of a legislative enactment. Admittedly springing from a deep. 1180 . It also poses an important issue of fact. and within the field of economy it regulates. police power and equal protection of the laws. and positive nationalistic impulse. rooted in the drive and urge for national survival and welfare. the law purports to protect citizen and country from the alien retailer. militant. fundamental and far-reaching in significance. Pertinent provisions of Republic Act No. that is whether the conditions which the disputed law purports to remedy really or actually exist. Through it. Navarro as Amicus Curiae. The enactment poses questions of due process. LABRADOR. so that the country and the nation may be free from a supposed economic dependence and bondage. into a concrete and tangible measures designed to free the national retailer from the competing dominance of the alien. Congress attempts to translate national aspirations for economic independence and national security.Emiliano R. J. Do the facts and circumstances justify the enactment? II.: I.

(5) a prohibition against the establishment or opening by aliens actually engaged in the retail business of additional stores or branches of retail business. giving. The main provisions of the Act are: (1) a prohibition against persons. not citizens of the Philippines. among other matters. (4) a provision for the forfeiture of licenses (to engage in the retail business) for violation of the laws on nationalization. their assets and liabilities and their offices and principal offices of judicial entities. (6) a provision requiring aliens actually engaged in the retail business to present for registration with the proper authorities a verified statement concerning their businesses. until their death or voluntary retirement in case of natural persons. who are allowed to continue to engaged therein. unless their licenses are forfeited in accordance with the law. (2) an exception from the above prohibition in favor of aliens actually engaged in said business on May 15. to continue such business for a period of six months for purposes of liquidation." In effect it nationalizes the retail trade business. and (7) a provision allowing the heirs of aliens now engaged in the retail business who die.Republic Act No. from engaging directly or indirectly in the retail trade. partnerships. the nature of the business. and against associations. 1954. (3) an exception therefrom in favor of citizens and juridical entities of the United States. control weights and measures and labor and other laws relating to trade. commerce and industry. 1180 is entitled "An Act to Regulate the Retail Business. or corporations the capital of which are not wholly owned by citizens of the Philippines. . and for ten years after the approval of the Act or until the expiration of term in case of juridical persons.

(2) the subject of the Act is not expressed or comprehended in the title thereof. Grounds upon which petition is based-Answer thereto Petitioner. (2) the Act has only one subject embraced in the title. No. In answer. and to enjoin the Secretary of Finance and all other persons acting under him. Petitioner attacks the constitutionality of the Act. 1180. (4) the provisions of the Act against the transmission by aliens of their retail business thru hereditary succession. contending that: (1) it denies to alien residents the equal protection of the laws and deprives of their liberty and property without due process of law . for and in his own behalf and on behalf of other alien residents corporations and partnerships adversely affected by the provisions of Republic Act. (3) no treaty or international obligations .III. the Solicitor-General and the Fiscal of the City of Manila contend that: (1) the Act was passed in the valid exercise of the police power of the State. brought this action to obtain a judicial declaration that said Act is unconstitutional. (3) the Act violates international and treaty obligations of the Republic of the Philippines. particularly city and municipal treasurers. Article XIII and Section 8 of Article XIV of the Constitution. violate the spirit of Sections 1 and 5. from enforcing its provisions. which exercise is authorized in the Constitution in the interest of national economic survival. and those requiring 100% Filipino capitalization for a corporation or entity to entitle it to engage in the retail business.

and what is the function and duty of the courts? These consideration must be clearly and correctly understood that their application to the facts of the case may be brought forth with clarity and the issue accordingly resolved. What is the scope of police power. considerations in the determination of the ever recurrent conflict between police power and the guarantees of due process and equal protection of the laws. only the form is affected but the value of the property is not impaired. Preliminary consideration of legal principles involved a. — There is no question that the Act was approved in the exercise of the police power. (4) as regards hereditary succession. albeit preliminary. but petitioner claims that its exercise in this instance is attended by a violation of the constitutional requirements of due process and equal protection of the laws. IV. The police power. But before proceeding to the consideration and resolution of the ultimate issue involved. . and the institution of inheritance is only of statutory origin. it would be well to bear in mind certain basic and fundamental.are infringed. and how are the due process and equal protection clauses related to it? What is the province and power of the legislature.

and as such it is the most positive and active of all governmental processes. it is said to be co-extensive with self-protection and survival.It has been said the police power is so far . Limitations on police power. just as the fields of public interest and public welfare have become almost all-embracing and have transcended human foresight. what they do is to set forth the limitations thereof. b. Especially is it so under a modern democratic framework where the demands of society and of nations have multiplied to almost unimaginable proportions. insistent and illimitable. Otherwise stated. so we cannot delimit beforehand the extent or scope of police power by which and through which the State seeks to attain or achieve interest or welfare. As it derives its existence from the very existence of the State itself. as we cannot foresee the needs and demands of public interest and welfare in this constantly changing and progressive world. it does not need to be expressed or defined in its scope. the most essential. So it is that Constitutions do not define the scope or extent of the police power of the State.reaching in scope. the field and scope of police power has become almost boundless. — The basic limitations of due process and equal protection are found in the following provisions of our Constitution: . that it has become almost impossible to limit its sweep. The most important of these are the due process clause and the equal protection clause.

The equal protection clause is not infringed by legislation which applies only to those persons falling within a specified class. Phil. 30. as well as hostile discrimination or the oppression of inequality. ed.) . or of nationality. 824-825.(1) No person shall be deprived of life. — The equal protection of the law clause is against undue favor and individual or class privilege. which is limited either in the object to which it is directed or by territory within which is to operate.SECTION 1. Constitutional Limitations. equal protection clause. it merely requires that all persons shall be treated alike. are not limited to citizens alone but are admittedly universal in their application.) c. and reasonable grounds exists for making a distinction between those who fall within such class and those who do not. 226. under like circumstances and conditions both as to privileges conferred and liabilities enforced. without regard to any differences of race. It does not demand absolute equality among residents. Hopkins. (Yick Wo vs. 220. L. The. liberty or property without due process of law. (2 Cooley. Constitution) These constitutional guarantees which embody the essence of individual liberty and freedom in democracies. of color. nor any person be denied the equal protection of the laws. if it applies alike to all persons within such class. (Article III. It is not intended to prohibit legislation.

the indispensable means for the attainment of legitimate aspirations of any democratic society. the power and the guarantees are supposed to coexist. — The due process clause has to do with the reasonableness of legislation enacted in pursuance of the police power. is reason. for that would mean license and anarchy. provided there is due process of law. whoever exercise it. a public purpose. shall it be said. for that would be tyranny. liberty and property. The test or standard.d. So the State can deprive persons of life. There can be no absolute power. is public welfare involved? Is the Act reasonably necessary for the accomplishment of the legislature's purpose. arbitrary or oppressive? Is there sufficient foundation or reason in connection with the matter involved. Is there public interest. therefore. and persons may be classified into classes and groups. between police power and the guarantees of due process and equal protection of the laws is more apparent than real. as always. The balancing is the essence or. or is it not merely an unjustified interference with private interest? These are the questions that we ask when the due process test is applied. The due process clause. provided everyone is given the equal protection of the law. Properly related. The conflict. or has there not been a capricious use of the legislative power? Can the aims conceived be achieved by the means used. The police power legislation . Yet there can neither be absolute liberty. is it not unreasonable.

is by force of circumstances primarily the judge of necessity. V. On the other hand. of any law promulgated in the exercise of the police power. in the first place. have nevertheless evinced a reluctance to interfere with the exercise of the legislative prerogative. e. And if distinction and classification has been made. Moreover. that the legislature. and courts never inquire into the wisdom of the law.must be firmly grounded on public interest and welfare. and a reasonable relation must exist between purposes and means. or of the measures adopted to implement the public policy or to achieve public interest. Legislative discretion not subject to judicial review. in this matter of equitable balancing. adequacy or reasonableness and wisdom. courts. there must be a reasonable basis for said distinction. which is the constitutional repository of police power and exercises the prerogative of determining the policy of the State. courts are not supposed to override legitimate policy. — Now. although zealous guardians of individual liberty and right. what is the proper place and role of the courts? It must not be overlooked. They have done so early where there has been a clear. Economic problems sought to be remedied . patent or palpable arbitrary and unreasonable abuse of the legislative prerogative.

there would be no question that it falls within the legitimate scope of legislative power. the dealer. color or citizenship. irrespective of race. Retail dealers perform the functions of capillaries in the human body. a. thru which all the needed food and supplies are ministered to members of the communities comprising the nation. as its title indicates. of course. the aliens.With the above considerations in mind. But it goes further and prohibits a group of residents. in which man's needs have multiplied and diversified to unlimited extents and proportions. the retailer comes as essential as the producer. trade or occupation. As villages develop into big communities and specialization in production begins. — In a primitive economy where families produce all that they consume and consume all that they produce. Importance of retail trade in the economy of the nation. the dealer's importance is enhanced. Under modern conditions and standards of living. . goods and needed for daily life are placed within the easy reach of consumers. because thru him the infinite variety of articles. the dealer comes into existence. which from the immemorial has always been open to residents. we will now proceed to delve directly into the issue involved. from engaging therein. If the disputed legislation were merely a regulation. The problem becomes more complex because its subject is a common. is unknown. But as group life develops and families begin to live in communities producing more than what they consume and needing an infinite number of things they do not produce. as old as society itself.

therefore. now he predominates in the cities and big centers of population. He has cloths to sell. even the needle and the thread to sew them or darn the clothes that wear out. Slowly but gradually be invaded towns and villages. in far away nooks where the beginnings of community life appear. from the lowly peddler. and the patience and forbearance of a slave. He has shown in this trade. the spices needed for the daily cooking. food in all its increasing forms. The alien retailer's trait. — The alien retailer must have started plying his trades in this country in the bigger centers of population (Time there was when he was unknown in provincial towns and villages). the salt. . the vinegar. It is an undeniable fact that in many communities the alien has replaced the native retailer. He provides his customers around his store with the rice or corn. the fish. industry without limit. ministering to the daily needs of the residents and purchasing their agricultural produce for sale in the towns. and the various little gadgets and things needed for home and daily life. a supermarket is so much a part of day-to-day existence. He even pioneers. b.There cannot be any question about the importance of the retailer in the life of the community. the owner of a small sari-sari store. The retailer. to the operator of a department store or. He ministers to the resident's daily needs.

about the controlling and dominant position that the alien retailer holds in the nation's economy. in another. sugar. also so many unmanageable factors in the retail business make control virtually . drugs. hardware. Alienage. Food and other essentials. c. flour. and scores of other goods and articles. but he heeds them not. which appears to be true to fact. In big cities and centers of population he has acquired not only predominance. Petitioner denies that there is alien predominance and control in the retail trade. The community takes note of him. it is charged that the law is merely the result of radicalism and pure and unabashed nationalism. and he forgets and forgives. such as lumber. it is said. Alleged alien control and dominance. clothing. groceries. but apparent control over distribution of almost all kinds of goods. In one breath it is said that the fear is unfounded and the threat is imagined. the Namarco. almost all articles of daily life reach the residents mostly through him. textiles. his control over principal foods and products would easily become full and complete. is not an element of control. insults of ill-bred and insolent neighbors and customers are made in his face. but he laughs these off without murmur. as he appears to be harmless and extremely useful. — There is a general feeling on the part of the public. And were it not for some national corporations like the Naric.Derogatory epithets are hurled at him. garlic. the Facomas and the Acefa.

as witness the following tables: Assets Gross Sales Year and Retailers Nationality .impossible. The first argument which brings up an issue of fact merits serious consideration. when the fear of alien domination and control of the retail trade already filled the minds of our leaders with fears and misgivings. Between the constitutional convention year (1935). and the year of the enactment of the nationalization of the retail trade act (1954). The others are matters of opinion within the exclusive competence of the legislature and beyond our prerogative to pass upon and decide. which put down the figures in black and white. official statistics unmistakably point out to the ever-increasing dominance and control by the alien of the retail trade. The best evidence are the statistics on the retail trade.

No.-Establishments Pesos Per cent Distribution Pesos Per cent Distribution 1941: .

.Filipino .. 106....138 ....323.671 200..

692 32.55.181.348...82 174.924 51..356 118.......98 .74 Chinese . 15..

239 44.20 .187..148.. 1.646 40...813.090 11...21 Others ......

630.239 4.13.05 1947: .

333 57..658.583..Filipino .946 65....05 279...107 208.03 ... 111.

...........218 33.56 205...134 41..701.774 106.96 Others .Chinese . . 13.....156...

49 4.761.01 1948: (Census) .168 1.260 .354 8.927.

..631 213.264 ..Filipino ..342.. 113.....

...51 Chinese .459 .30 467..161..67.155....667 60. 12.087 93..

.32 .38 294.29....514.20 Others .. 422 10...227 38.894.675 3...

995.29 1949: .9.402 1.

..47 ...901 53.Filipino .89 462..... 113.532.451.602 60.659 213..

72 392..36 ....223.248 125.414...875 45.. 16.Chinese ..336 35..

..Others ......364 1.078.365 3.056.39 10..17 1951: . 486 12..

...053...620 ..Filipino .. 119..352 224.

.07 Chinese .429 134.09 466.......052 53.61. 17.325.058..303 ..

...60 404.025 2.481.384 46...31 ...36.06 Others . 347 8..614..

7.645.327 87 AVERAGE ASSETS AND GROSS SALES PER ESTABLISHMENT Year and Retailer's Nationality Item Assets (Pesos) Gross Sales .

.......878 1........ 1...................633 .......(Pesos) 1941: Filipino .......

................................281 1947: . 24........415 8....707 9...................Chinese .............691 Others ............... 7......

................. 1..................516 Chinese ..............Filipino .................... ...................878 2...

......... 24........749 13.707 14...934 Others .....7.......................919 1948: (Census) ..

.........111 Chinese .Filipino .................................878 4.. 1............. 7..............................707 ......

916 23...........686 1949: ............24.......398 Others ........ 24............

069 Chinese ...................878 4.......... 7...........Filipino ....152 ............... 1..............707 24.......................

807 20........ 24....................737 1951: ..Others ...................

..........707 33.............877 3.....207 .......................................... 1...Filipino .... 7......905 Chinese ............

...... It is true.. By Year and Nationality of Owners.. that Filipinos have the edge in the number of retailers.824 22.... The above figures reveal that in percentage distribution of assests and gross sales........ Benchmark: 1948 Census... while the figures on Filipino establishments already include mere market vendors........ of course... Numbers in . pp.. issued by the Bureau of Census and Statistics.. 24... but aliens more than make up for the numerical gap through their assests and gross sales which average between six and seven times those of the very many Filipino retailers.) The above statistics do not include corporations and partnerships..... Department of Commerce and Industry...033 (Estimated Assets and Gross Sales of Retail Establishments.. alien participation has steadily increased during the years... 18-19 of Answer......Others . whose capital is necessarily small.

and the Filipino retailer is practically helpless in matters of capital. remarks that the Filipino retailers were largely engaged in minor retailer enterprises. here. — It is this domination and control. pointing out to the known predominance of foreign elements in the retail trade.) That was twenty-two years ago. . The Framing of the Philippine Constitution. the alien invests more capital. . Alien control and threat. The same official report. buys and sells six to seven times more. credit. the native investment is thinly spread. that "it is the sense of the Convention that the public interest requires the nationalization of the retail trade. which we believe has been sufficiently shown to exist. As observed by respondents. d. 662-663. subject of apprehension in Constitutional convention. commenting on the patrimony clause of the Preamble opines that the fathers of our Constitution were merely translating the general preoccupation of Filipinos "of the dangers from alien interests that had already brought under their . . price and supply.retailers. and the events since then have not been either pleasant or comforting." (II Aruego. that is the legislature's target in the enactment of the disputed nationalization would never have been adopted. do not imply superiority. and gains much more. Dean Sinco of the University of the Philippines College of Law. . quoted on page 67 of Petitioner. The framers of our Constitution also believed in the existence of this alien dominance and control when they approved a resolution categorically declaring among other things.

political independence alone is no guarantee to national stability and strength. approved on July 18. it (the Constitution) envisages an organized movement for the protection of the nation not only against the possibilities of armed invasion but also against its economic subjugation by alien interests in the economic field. 476. he says: But there has been a general feeling that alien dominance over the economic life of the country is not desirable and that if such a situation should remain. Moreover. has to step in and assume the initiative. it is but of recent formation and hence. largely inexperienced.control the commercial and other economic activities of the country" (Sinco. they fear the dangers coming from alien control. 1. if not the leadership. 10th ed. p. and analyzing the concern of the members of the constitutional convention for the economic life of the citizens. manufacturers and producers believe so. p.. 10th ed. (Phil. Political Law. Thus . of the Fifth National . Witness thereto is Resolution No. Political Law by Sinco. . 1953.. the government as the instrumentality of the national will. . Under such conditions.) Belief in the existence of alien control and predominance is felt in other quarters. and they express sentiments of economic independence. Phil. timid and hesitant. in connection with the nationalistic provisions of the Constitution. Filipino businessmen. Filipino private capital is not big enough to wrest from alien hands the control of the national economy. in the struggle for the economic freedom of the nation in somewhat the same way that it did in the crusade for political freedom. 114).

or because a new competing article offers bigger profits for its . e. With ample capital. a reality proved by official statistics. the determination of the amount of goods or articles to be made available in the market. alien predominance and control.convention of Filipino Businessmen. and a similar resolution. Nationals. unity of purpose and action and thorough organization. therefore. because the producer or importer does not offer them sufficient profits. and even the choice of the goods or articles they would or would not patronize or distribute. producers and consumers alike can be placed completely at their mercy. Dangers of alien control and dominance in retail. so our newspapers. Suppose an article of daily use is desired to be prescribed by the aliens. which have editorially pointed out not only to control but to alien stranglehold. This is easily illustrated. there is a prevailing feeling that such predominance may truly endanger the national interest. — But the dangers arising from alien participation in the retail trade does not seem to lie in the predominance alone. and felt by all the sections and groups that compose the Filipino community. The man in the street also believes. and fears. find alien domination and control to be a fact. 1954. alien retailers and merchants can act in such complete unison and concert on such vital matters as the fixing of prices. that fears of dislocation of the national economy and of the complete subservience of national economy and of the consuming public are not entirely unfounded. approved on March 20. of the Second National Convention of Manufacturers and Producers. We.

We can even go farther than theoretical illustrations to show the pernicious influences of alien domination. so much so that the Government has had to establish the National Rice and Corn Corporation to save the public from their continuous hoarding practices and tendencies. like corn and rice. Republic Act No.introduction. or its consumers. It is a fact within judicial notice. that they have secret combinations among themselves to control prices. creating artificial scarcities to justify and enhance profits to unreasonable proportions. Hence. eliminating it from their stocks. that they have hoarded essential foods to the inconvenience and prejudice of the consuming public. find the article suddenly out of circulation. especially on foods and essential commodities. that at some time or other they have cornered the market of essential commodities. that there exists a general feeling on the part of the public that alien participation in the retail trade has been attended by a pernicious and intolerable practices. All that aliens would do is to agree to refuse to sell the first article. 1168). such that the legislature had to enact a law (Sec. which courts of justice may not properly overlook or ignore in the interests of truth and justice. or its consumers. find the article suddenly out of the prescribed article. offering the new one as a substitute. cheating the . that they have violated price control laws. authorizing their immediate and automatic deportation for price control convictions. Grave abuses have characterized the exercise of the retail trade by aliens. Freedom of trade is thus curtailed and free enterprise correspondingly suppressed. the producers or importers of the prescribed article. the mention of a few of which would suffice for our purposes. 9.

It is also believed that they have engaged in corrupting public officials with fabulous bribes. and the State cannot rely upon them in times of crisis or emergency. The present dominance of the alien retailer. As a matter of fact appeals to unscrupulous aliens have been made both by the Government and by their own lawful diplomatic representatives. violated import and export prohibitions. . We do not have here in this country isolated groups of harmless aliens retailing goods among nationals. what we have are well organized and powerful groups that dominate the distribution of goods and commodities in the communities and big centers of population. especially in the big centers of population. action which impliedly admits a prevailing feeling about the existence of many of the above practices. control laws and the like. While the national holds his life. his person and his property subject to the needs of his country. indirectly causing the prevalence of graft and corruption in the Government. They owe no allegiance or loyalty to the State. therefore. the alien may even become the potential enemy of the State. in derision and contempt of lawful authority. smuggled goods and money into and out of the land.operation of the law of supply and demand. The circumstances above set forth create well founded fears that worse things may come in the future. in unlawful restraint of freedom of trade and enterprise. becomes a potential source of danger on occasions of war or other calamity. that they have connived to boycott honest merchants and traders who would not cater or yield to their demands. They are believed by the public to have evaded tax laws.

Objections to alien participation in retail trade. and indisputably falls within the scope of police power. — We are fully satisfied upon a consideration of all the facts and circumstances that the disputed law is not the product of racial hostility. prejudice or discrimination. Law enacted in interest of national economic survival and security. he is attracted by the lure of gain and profit. — The next question that now poses solution is. thru which and by which the State insures its existence and security and the supreme welfare of its citizens. The law is clearly in the interest of the public. we admit. VI. His aim or purpose of stay. to free the nation from the economic situation that has unfortunately been saddled upon it rightly or wrongly. is neither illegitimate nor . his stay here is for personal convenience. The Equal Protection Limitation a. to its disadvantage. nay of the national security itself. thru their authorized representatives. the mere fact of alienage is the root and cause of the distinction between the alien and the national as a trader. The alien resident owes allegiance to the country of his birth or his adopted country. Does the law deny the equal protection of the laws? As pointed out above. but the expression of the legitimate desire and determination of the people.f.

The faster he makes his pile. The alien's interest in this country being merely transient and temporary. The practices resorted to by aliens in the control of distribution. Another objection to the alien retailer in this country is that he never really makes a genuine contribution to national income and wealth. show the existence of real and actual. the earlier can the alien go back to his beloved country and his beloved kin and countrymen. their secret manipulations of stocks of commodities and prices. that it has been found necessary to adopt the legislation. but he is naturally lacking in that spirit of loyalty and enthusiasm for this country where he temporarily stays and makes his living. manipulations and disregard do not attend the exercise of the trade by the nationals.immoral. He undoubtedly contributes to general distribution. radical as it may seem. sympathy and consideration for his Filipino customers as would prevent him from taking advantage of their weakness and exploiting them. or of that spirit of regard. but the gains and profits he makes are not invested in industries that would help the country's economy and increase national wealth. their utter disregard of the welfare of their customers and of the ultimate happiness of the people of the nation of which they are mere guests. which practices. as already pointed out above. positive and fundamental . The experience of the country is that the alien retailer has shown such utter disregard for his customers and the people on whom he makes his profit. it would indeed be ill-advised to continue entrusting the very important function of retail distribution to his hands.

— The above objectionable characteristics of the exercise of the retail trade by the aliens. and all persons of one class are treated alike. The legislative power admits of a . Since the Court finds that the classification is actual. Broadly speaking. Difference in alien aims and purposes sufficient basis for distinction. We would be doing violence to fact and reality were we to hold that no reason or ground for a legitimate distinction can be found between one and the other. the power of the legislature to make distinctions and classifications among persons is not curtailed or denied by the equal protection of the laws clause. To this we answer. furnish sufficient grounds for legislative classification of retail traders into nationals and aliens. Some may disagree with the wisdom of the legislature's classification. which are actual and real. real and reasonable. that this is the prerogative of the law-making power. b. These differences are certainly a valid reason for the State to prefer the national over the alien in the retail trade. it is in duty bound to declare that the legislature acted within its legitimate prerogative and it can not declare that the act transcends the limit of equal protection established by the Constitution. and as it cannot be said that the classification is patently unreasonable and unfounded.differences between an alien and a national which fully justify the legislative classification adopted in the retail trade measure.

and a law can be violative of the constitutional limitation only when the classification is without reasonable basis. — The question as to whether or not citizenship is a legal and valid ground for classification has already been affirmatively decided in this .. A classification having some reasonable basis does not offend against that clause merely because it is not made with mathematical nicety. The equal protection clause of the Fourteenth Amendment does not take from the state the power to classify in the adoption of police laws. In addition to the authorities we have earlier cited. . Authorities recognizing citizenship as basis for classification. Natural Carbonic Fas Co. One who assails the classification in such a law must carry the burden of showing that it does not rest upon any reasonable basis but is essentially arbitrary. 3. but admits of the exercise of the wide scope of discretion in that regard. we can also refer to the case of Linsey vs." c. . 55 L. . the existence of that state of facts at the time the law was enacted must be assumed. and therefore is purely arbitrary. ed. 4. 2. or because in practice it results in some inequality. "1. and avoids what is done only when it is without any reasonable basis.wide scope of discretion. if any state of facts reasonably can be conceived that would sustain it. 369. which clearly and succinctly defined the application of equal protection clause to a law sought to be voided as contrary thereto: . When the classification in such a law is called in question. (1911).

because of a condition therein limiting the ownership of vessels engaged in coastwise trade to corporations formed by citizens of the Philippine Islands or the United States. as follows: "Licensing acts. in this instance. 2761 of the Philippine Legislature was in issue. in fact.jurisdiction as well as in various courts in the United States. it was held that the Philippine Legislature did not violate the equal protection clause of the Philippine Bill of Rights. and all presumptions are in favor of its constitutionality. and a countervailing privilege in favor of American shipping is contemplated. and place them on an equal footing with the shipping of other nations. we held that the limitation of domestic ownership of vessels engaged in coastwise trade to citizens of the Philippines does not violate the equal protection of the law and due process or law clauses of the Philippine Bill of Rights. and forms part of an extensive system. In the case of Smith Bell & Co. retailers of spirituous liquors. the object of which is to encourage American shipping. vs. The act. 9 Wheat. Ogden. Natividad. We held that this was a valid exercise of the police power. for example. In substance. In rendering said decision we quoted with approval the concurring opinion of Justice Johnson in the case of Gibbons vs. acts licensing gaming houses. in legislation. are universally restraining acts. as. etc. The legislature in enacting the law had as ultimate purpose the encouragement of Philippine shipbuilding and the safety for these Islands from foreign interlopers. in the whole legislation of the United States on this . thus denying the right to aliens.. Almost every commercial nation reserves to its own subjects a monopoly of its coasting trade. 40 Phil. 136. I. is distinctly of that character. where the validity of Act No.

in surreptitiously intruding themselves into the American commercial marine. Broadly speaking. 81 N. E. the difference in status between citizens and aliens constitutes a basis for reasonable classification in the exercise of police power. a statute on the licensing of hawkers and peddlers.) In Commonwealth vs. as contra distinguished from foreign." The rule in general is as follows: Aliens are under no special constitutional protection which forbids a classification otherwise justified simply because the limitation of the class falls along the lines of nationality. and to preserve the Government from fraud by foreigners. for the following reason: It may seem wise to the legislature to limit the business of those who are supposed to have regard for the welfare. that this whole system is projected. and the court cannot .subject. 1907). But it is to confer on her American privileges. was held valid. which provided that no one can obtain a license unless he is. 468-469. or has declared his intention. to become a citizen of the United States. that the license is granted. that effect has been correctly attributed to the act of her enrollment. good order and happiness of the community. as well as frauds upon the revenue in the trade coastwise. That would be requiring a higher degree of protection for aliens as a class than for similar classes than for similar classes of American citizens.. It is not to give the vessel an American character. Jur. (2 Am. Hana. 149 (Massachusetts.

151 (Minnesota.S. hence the prohibitions of issuance of . ed. 129 (Ohio.. In Asakura vs. 1912). In Ohio ex rel. the business of pawn brooking was considered as having tendencies injuring public interest. S. 71 L. and limiting it to citizens is within the scope of police power. the court said that aliens are judicially known to have different interests. Van Winkle. invalid. from engaging in the traffic of liquors. 1922). psychology and loyalty. 274 U. 1915 P. 115 (1926). therefore. So also in Anton vs. among them aliens. Clarke vs. A similar statute denying aliens the right to engage in auctioneering was also sustained in Wright vs. May. 392. L. E. Deckebach. was found not to be the result of race hatred. but was based on the belief that an alien cannot be sufficiently acquainted with "our institutions and our life as to enable him to appreciate the relation of this particular business to our entire social fabric". a statute which prevented certain persons. E. Supreme Court had under consideration an ordinance of the city of Cincinnati prohibiting the issuance of licenses (pools and billiard rooms) to aliens. 30 (Washington. City of Seattle. Carrol. State. 340 (Oregon. It held that plainly irrational discrimination against aliens is prohibited. 210 P. The case of State vs. attitude. or in hospitality. or a deliberate purpose to discriminate. but it does not follow that alien race and allegiance may not bear in some instances such a relation to a legitimate object of legislation as to be made the basis of permitted classification. 1924).R. and that latitude must be allowed for the legislative appraisement of local conditions and for the legislative choice of methods for controlling an apprehended evil.A. In Bloomfield vs. 1914). 297 F. knowledge. 99 N. the U. and was not. 124 N. and that it could not state that the legislation is clearly wrong. 1919) is a parallel case to the one at bar. 309 (Ohio.question this judgment and conclusion.

card room. a state law which imposed a tax on every employer of foreign-born unnaturalized male persons over 21 years of age. dance hall. However. 92 L. Michigan State Board of Examiners. so there was no adequate justification for the discrimination. 1897). ed. — . and because there is no public interest in the mere claim of ownership of the waters and the fish in them. 1479 (1947). 1902). Authorities contra explained. In Takahashi vs. two Justices dissented on the theory that fishing rights have been treated traditionally as natural resources. McConway & Tarley Co. a California statute banning the issuance of commercial fishing licenses to person ineligible to citizenship was held void. d. was declared void because the court found that there was no reason for the classification and the tax was an arbitrary deduction from the daily wage of an employee. In Templar vs. 1058 (Michigan. is not an infringement of constitutional rights.licenses to them for the business of pawnbroker. Fish and Game Commission. 82 Fed. 257 (Pennsylvania. or even the convenience of the community. It further added that the law was the outgrowth of antagonism toward the persons of Japanese ancestry. 90 N. pool. the health. a law prohibiting the licensing of aliens as barbers was held void. billiard. In Fraser vs. because the law conflicts with Federal power over immigration.W. but the reason for the decision was the court's findings that the exercise of the business by the aliens does not in any way affect the morals..

. unreasonable or capricious. or were the result or product of racial antagonism and hostility. because the discrimination bore no reasonable and just relation to the act in respect to which the classification was proposed. 70 L. 30 L. but the main reasons for the decisions are: (1) that if Chinese were driven out of business there would be no other system of distribution. therefore. ed. The real reason for the decision. Trinidad. In State vs. Spanish or any other local dialect. 47 A. is the court's belief that no public benefit would be derived from the operations of the law and on the other hand it would deprive Chinese of something indispensable for carrying on their business. 1059 (1925). a law prohibiting aliens to engage as hawkers and peddlers was declared void. because they would be deprived of their right to be advised of their business and to direct its conduct. ed 220 (1885) an ordinance conferring powers on officials to withhold consent in the operation of laundries both as to persons and place. and there was no question of public interest involved or pursued. 1900). Hopkins. But in this decision the laws declared invalid were found to be either arbitrary. In Yu Cong Eng vs. In Yick Wo vs. 165 (Maine. and (2) that the Chinese would fall prey to all kinds of fraud.It is true that some decisions of the Federal court and of the State courts in the United States hold that the distinction between aliens and citizens is not a valid ground for classification. Montgomery. was declared invalid. but the court said that the power granted was arbitrary. that there was no reason for the discrimination which attended the administration and implementation of the law. and that the motive thereof was mere racial hostility. the United States Supreme Court declared invalid a Philippine law making unlawful the keeping of books of account in any language other than English.

. We can do no better than borrow the language of Anton vs. Further enlargement. to drive home the reality and significance of the distinction between the alien and the national. 340. is unnecessary. It may be judicially known. So it is likewise known that certain classes of aliens are of different psychology from our fellow countrymen. . and the facts make them so. as those who by citizenship. Furthermore. are a part of the government itself. .The case at bar is radically different. that alien coming into this country are without the intimate knowledge of our laws. whose allegiance is first to their own country. especially in times of crisis and emergency. 342. however. Van Winkle. it is natural and reasonable to suppose that the foreign born. aliens do not naturally possess the sympathetic consideration and regard for the customers with whom they come in daily contact. I have said enough so that obviously it cannot be affirmed with absolute confidence that the Legislature was without plausible reason for making the classification. and whose ideals of governmental environment and control have been engendered and formed under entirely different regimes and political systems. except in so far as it enhances their profit. These limitations on the qualifications of the aliens have been shown on many occasions and instances. customs. have not the same inspiration for the public weal. nor are they as well disposed toward the United States. 297 F. As we already have said. and therefore . nor the loyalty and allegiance which the national owes to the land. thus: . and usages that our own people have. nor the patriotic desire to help bolster the nation's economy.

The Due Process of Law Limitation.appropriate discriminations against aliens as it relates to the subject of legislation. as has often been held. . demands only that the law shall not be unreasonable. It has been stated by the highest authority in the United States that: . . And the guaranty of due process. arbitrary or capricious. the test of the limitation. VII. . and that the means selected shall have a real and substantial relation to the subject sought to be attained. . . and to enforce that policy by legislation adapted to its . . Reasonability. . . a. . xxx xxx xxx So far as the requirement of due process is concerned and in the absence of other constitutional restriction a state is free to adopt whatever economic policy may reasonably be deemed to promote public welfare. — We now come to due process as a limitation on the exercise of the police power. determination by legislature decisive. . .

for the test used to determine the constitutionality of the means employed by the legislature is to inquire whether the restriction it imposes on rights secured to individuals by the Bill of Rights are unreasonable. ed. . 78 L. If the laws passed are seen to have a reasonable relation to a proper legislative purpose. A statute to be within this power must also be reasonable in its operation upon the persons whom it affects. . 1:1).1074-1075. . New York.) . (Nebbia vs. (11 Am. . 302.) Another authority states the principle thus: . 957. . xxx xxx xxx . . and are neither arbitrary nor discriminatory. . and not whether it imposes any restrictions on such rights.purpose. when it is declared by the legislature. or. . The courts are without authority either to declare such policy. 950. must not be for the annoyance of a particular class. . Jur. .. . to override it. and must not be unduly oppressive. and judicial determination to that effect renders a court functus officio. . 940. Sec. the requirements of due process are satisfied. Too much significance cannot be given to the word "reasonable" in considering the scope of the police power in a constitutional sense.

To justify the state in thus interposing its authority in behalf of the public. Prata Undertaking Co. that the interests of the public generally. 389. State Board of Embalming. as distinguished from those of a particular class. 104 ALR. vs. Steele. and general welfare of the public. b. . without substantial relation to the health. . fixes this test of constitutionality: In determining whether a given act of the Legislature. is or is not constitutional. require such interference. oppressive. — . Petitioner's argument considered. . it was also held: . passed in the exercise of the police power to regulate the operation of a business. 385. safety. or is an arbitrary. and second. first. ed. and capricious use of that power. and not unduly oppressive upon individuals. . comfort. it must appear. one of the first questions to be considered by the court is whether the power as exercised has a sufficient foundation in reason in connection with the matter involved. 395.In the case of Lawton vs. . 38 L. that the means are reasonably necessary for the accomplishment of the purpose. . morals. 388.

that he now enjoys a monopolistic control of the occupation and threatens a deadly stranglehold on the nation's economy endangering the national security in times of crisis and emergency. as we have also found and indicated. by the alien in an honest creditable and unimpeachable manner.Petitioner's main argument is that retail is a common. that in this country where the occupation is engaged in by petitioner.. is not that posed by petitioner. to free national economy from alien control and dominance. Is the exclusion in the future of aliens from the retail trade unreasonable. therefore. it has been so engaged by him. taking into account the illegitimate and pernicious form and manner in which the aliens have heretofore engaged therein? As thus correctly stated the answer is clear. one of those privileges long ago recognized as essential to the orderly pursuant of happiness by free men. tranquility and welfare. that it is a gainful and honest occupation and therefore beyond the power of the legislature to prohibit and penalized.e. But the Legislature has found. which overlooks and ignores the facts and circumstances. Arbitrary capricious. i.e.. but this. The law in question is deemed absolutely necessary to bring about the desired legislative objective. This arguments overlooks fact and reality and rests on an incorrect assumption and premise.) The test of reasonableness of a law is the appropriateness or . ordinary occupation. Jur. pp. i. It is not necessarily unreasonable because it affects private rights and privileges (11 Am. that the privilege has been so grossly abused by the alien. without harm or injury to the citizens and without ultimate danger to their economic peace. thru the illegitimate use of pernicious designs and practices. The real question at issue. 10801081.

adequacy under all circumstances of the means adopted to carry out its purpose into effect (Id. we do not propose to deprive persons who are not citizens of the Philippines of their means of livelihood. and who have no permanent stake in our people's welfare. which later was enacted into law: This bill proposes to regulate the retail business. disputed legislation. must be considered not to have infringed the constitutional limitation of reasonableness. The necessity of the law in question is explained in the explanatory note that accompanied the bill. who have no profound devotion to our free institutions. we are not really the masters of our destiny. which is not merely reasonable but actually necessary. In seeking to accomplish the foregoing purpose. . Its purpose is to prevent persons who are not citizens of the Philippines from having a strangle hold upon our economic life. even our national security. While this bill seeks to take away from the hands of persons who are not citizens of the Philippines a power that can be wielded to paralyze all aspects of our national life and endanger our national security it respects existing rights.) Judged by this test. will be at the mercy of other people. If the persons who control this vital artery of our economic life are the ones who owe no allegiance to this Republic. All aspects of our life.

— The framers of the Constitution could not have intended to impose the constitutional restrictions of due process on the attainment of such a noble motive as freedom from economic control and domination. especially if not of their own race or country. If political independence is a legitimate aspiration of a people. is one of the noblest motives that a national legislature may pursue. their freedom and liberty. It is impossible to conceive that legislation that seeks to bring it about can infringe the constitutional limitation of due process. The fathers of the Constitution must have given to the legislature full authority and power to enact legislation that would promote the supreme happiness of the people. The removal and eradication of the shackles of foreign economic control and domination. thru the exercise of the police power. Freedom and liberty are not real and positive if the people are subject to the economic control and domination of others.The approval of this bill is necessary for our national survival. then economic independence is none the less legitimate. On the precise . The attainment of a legitimate aspiration of a people can never be beyond the limits of legislative authority. Law expressly held by Constitutional Convention to be within the sphere of legislative action. c.

and others on this matter because it is convinced that the National Assembly is authorized to promulgate a law which limits to Filipino and American citizens the privilege to engage in the retail trade. Mr. quoted on pages 66 and 67 of the Memorandum for the Petitioner. but it abstain from approving the amendment introduced by the Delegate for Manila. or any other form of authorization for the operation of the public utility shall be granted except to citizens of the Philippines. they expressly made their voice clear. they adopted a resolution expressing their belief that the legislation in question is within the scope of the legislative power. certificate. The Framing of the Philippine Constitution. (11 Aruego. a principle objective is the conservation of the patrimony of the nation and as corollary the provision limiting to citizens of the Philippines the exploitation. Araneta. Thus in the preamble. invalid and unconstitutional? . Can it be said that a law imbued with the same purpose and spirit underlying many of the provisions of the Constitution is unreasonable. Thus they declared the their Resolution: That it is the sense of the Convention that the public interest requires the nationalization of retail trade. And in Section 8 of Article XIV. it is provided that "no franchise.issue now before us.) It would do well to refer to the nationalistic tendency manifested in various provisions of the Constitution. development and utilization of its natural resources." The nationalization of the retail trade is only a continuance of the nationalistic protective policy laid down as a primary objective of the Constitution.

Beside. the Legislature was in duty bound to face the problem and meet. Provisions of law not unreasonable. It would have been recreant to its duties towards the country and its people would it view the sorry plight of the nationals with the complacency and refuse or neglect to adopt a remedy commensurate with the demands of public interest and national survival. the exercise of legislative discretion is not subject to judicial review. its aims and purposes. Such provision would defeat the law itself. In the deliberations of the Court on this case. through adequate measures. As the repository of the sovereign power of legislation. — A cursory study of the provisions of the law immediately reveals how tolerant.The seriousness of the Legislature's concern for the plight of the nationals as manifested in the approval of the radical measures is. The law is made prospective and recognizes the right and privilege of those already engaged in the occupation to continue therein during the rest of their lives. and similar recognition of the right to continue is accorded associations of aliens. the danger and threat that alien domination of retail trade poses to national economy. It is well settled that the . fully justified. how reasonable the Legislature has been. The right or privilege is denied to those only upon conviction of certain offenses. d. attention was called to the fact that the privilege should not have been denied to children and heirs of aliens now engaged in the retail trade. therefore.

Court will not inquire into the motives of the Legislature. VIII. These principles also answer various other arguments raised against the law. and every presumption is in favor of its validity. that prices will increase because of the elimination of competition. that there would be repercussions from foreigners. as it conceals the real purpose of the bill which is to nationalize the retail business and prohibit aliens from engaging therein. that adequate replacement is problematical. and we find the provisions are not unreasonable. the test of the validity of a law attacked as a violation of due process. they do not import invalidity. that thousands of aliens would be thrown out of employment. is not its reasonableness. and though the Court may hold views inconsistent with the wisdom of the law. The constitutional . etc. some of which are: that the law does not promote general welfare. that there may be general breakdown. Many of these arguments are directed against the supposed wisdom of the law which lies solely within the legislative prerogative. that there is no need for the legislation. but its unreasonableness. it may not annul the legislation if not palpably in excess of the legislative power. nor pass upon general matters of legislative judgment. Alleged defect in the title of the law A subordinate ground or reason for the alleged invalidity of the law is the claim that the title thereof is misleading or deceptive. Furthermore. The Legislature is primarily the judge of the necessity of an enactment or of any of its provisions.

City of Wabash. (Sweet vs. quoted in page 41 of Answer." sufficiently expresses .. which reads: No bill which may be enacted in the law shall embrace more than one subject which shall be expressed in the title of the bill.provision which is claimed to be violated in Section 21 (1) of Article VI. which terms express the two main purposes and objectives of the law. Sec. 297. that is. p. Under the title of an act to "regulate". scope and consequences of the law or its operation (I Sutherland. the Legislature may prohibit the sale of intoxicating liquors. the title to regulate the sale of intoxicating liquors. the sale of intoxicating liquors. What the above provision prohibits is duplicity.) Within the meaning of the Constitution requiring that the subject of every act of the Legislature shall be stated in the tale. 1707. Statutory Construction. But "regulate" is a broader term than either prohibition or nationalization.) A cursory consideration of the title and the provisions of the bill fails to show the presence of duplicity. if its title completely fails to appraise the legislators or the public of the nature. It is true that the term "regulate" does not and may not readily and at first glance convey the idea of "nationalization" and "prohibition". Both of these have always been included within the term regulation. etc. 7. 41 Ind.

See. so were the title changed from "regulate" to "nationalize" or "prohibit". there is no absolute reason why it should not have such meaning when used in delegating police power in connection with a thing the best or only efficacious regulation of which involves suppression. (State vs. p.the subject of an act prohibiting the sale of such liquors to minors and to persons in the habit of getting intoxicated.) The general rule is for the use of general terms in the title of a bill. quoted in p. quoted in p. 306. 4803. 42 of Answer. State. is in accord with the principle governing the drafting of statutes. 718. 345. 887. therefore. and necessarily implies some degree of restraint and prohibition of acts usually done in connection with the thing to be regulated. the law also contains other rules for the regulation of the retail trade which may not be included in the terms "nationalization" or "prohibition". 48 Ind. Statutory Construction. 162 So. such matters being properly included within the subject of regulating the sale. . there would have been many provisions not falling within the scope of the title which would have made the Act invalid. The use of the term "regulate".) The above rule was followed the title of the Act in question adopted the more general term "regulate" instead of "nationalize" or "prohibit". it has also been said that the title need not be an index to the entire contents of the law (I Sutherland. (Williams vs. 182 La. 42 of Answer. 308. Morton. While word regulate does not ordinarily convey meaning of prohibit. Furthermore.) The word "regulate" is of broad import.

Alleged violation of international treaties and obligations Another subordinate argument against the validity of the law is the supposed violation thereby of the Charter of the United Nations and of the Declaration of the Human Rights adopted by the United Nations General Assembly. In the case at bar it cannot be claimed that the legislators have been appraised of the nature of the law. It cannot be claimed. IX. and a great many of the persons affected by the prohibitions in the law conducted a campaign against its approval. 29-32). and prevent the enactment into law of matters which have received the notice. especially the nationalization and the prohibition provisions. which would include all other provisions found in the body of the Act. The legislators took active interest in the discussion of the law. and the Declaration of Human Rights contains nothing more than a mere recommendation or a common standard of . be overruled. The objection must therefore. the nature and scope of its provisions. We find no merit in the Nations Charter imposes no strict or legal obligations regarding the rights and freedom of their subjects (Hans Kelsen. action and study of the legislators or of the public. One purpose of the constitutional directive that the subject of a bill should be embraced in its title is to apprise the legislators of the purposes. pp. 1951 ed. that the reasons for declaring the law invalid ever existed. therefore. The Law of the United Nations.under which a simple or general term should be adopted in the title.

258. are all prohibited from engaging in the retail trade.achievement for all peoples and all nations (Id. All that the treaty guarantees is equality of treatment to the Chinese nationals "upon the same terms as the nationals of any other country. Pennsylvania. and in most nations of the world laws against foreigners engaged in domestic trade are adopted. S. Thompson. such as Norway and Denmark.) X. the treaty is always subject to qualification or amendment by a subsequent law (U. 39. 58 L. But even supposing that the law infringes upon the said treaty. The Treaty of Amity between the Republic of the Philippines and the Republic of China of April 18. 257. except those of the United States. prohibit foreigners from engaging in retail trade. 539. 260). 1947 is also claimed to be violated by the law in question. who are granted special rights by the Constitution.) That such is the import of the United Nations Charter aid of the Declaration of Human Rights can be inferred the fact that members of the United Nations Organizations. ed. p." But the nationals of China are not discriminating against because nationals of all other countries. Fed. vs. Conclusion Resuming what we have set forth above we hold that the disputed law was enacted to remedy a real actual threat and danger to national economy posed by alien dominance and control of the retail business . and the same may never curtail or restrict the scope of the police power of the State (plaston vs.

that the provisions of the law are clearly embraced in the title. nor the due process of law clause. and that it cannot be said to be void for supposed conflict with treaty obligations because no treaty has actually been entered into on the subject and the police power may not be curtailed or surrendered by any treaty or any other conventional agreement. is merely to determine if the law falls within the scope of legislative authority and . and this suffers from no duplicity and has not misled the legislators or the segment of the population affected. that the wisdom and efficacy of the law to carry out its objectives appear to us to be plainly evident — as a matter of fact it seems not only appropriate but actually necessary — and that in any case such matter falls within the prerogative of the Legislature. because the law is prospective in operation and recognizes the privilege of aliens already engaged in the occupation and reasonably protects their privilege. with whose power and discretion the Judicial department of the Government may not interfere. that the enactment clearly falls within the scope of the police power of the State. Thus it is stated that the more time should have been given in the law for the liquidation of existing businesses when the time comes for them to close. thru which and by which it protects its own personality and insures its security and future. however. Our legal duty. Some members of the Court are of the opinion that the radical effects of the law could have been made less harsh in its impact on the aliens. that the law does not violate the equal protection clause of the Constitution because sufficient grounds exist for the distinction between alien and citizen in the exercise of the occupation regulated.and free citizens and country from dominance and control.

with costs against petitioner. lawphil Today is Saturday. 2012 Republic of the Philippines SUPREME COURT Manila EN BANC G.R. November 17. 1957 .does not transcend the limitations of due process and equal protection guaranteed in the Constitution. L-7995 May 31. Remedies against the harshness of the law should be addressed to the Legislature. The petition is hereby denied. No. they are beyond our power and jurisdiction.

Dionisio Reyes as Amicus Curiae. respondents. Quisumbing. J. petitioner. corporations and partnerships adversely affected. in general . in his own behalf and in behalf of other alien residents. Mendiola as Amicus Curiae.: I. Secretary of Finance. LABRADOR. Salazar and Associates for petitioner. Serrano for respondent City Treasurer. de Castro for respondent Secretary of Finance. Lichauco and Picazo and Sycip. JAIME HERNANDEZ. 1180. and MARCELINO SARMIENTO. ICHONG. Marcial G. Ozaeta. Emiliano R. vs. Navarro as Amicus Curiae. City Fiscal Eugenio Angeles and Assistant City Fiscal Eulogio S. by Republic Act No. City Treasurer of Manila.LAO H. Office of the Solicitor General Ambrosio Padilla and Solicitor Pacifico P. The case and issue.

into a concrete and tangible measures designed to free the national retailer from the competing dominance of the alien. (2) an exception from the above prohibition in favor of aliens actually engaged in said business on May 15. that is whether the conditions which the disputed law purports to remedy really or actually exist. who are allowed to . It also poses an important issue of fact. Pertinent provisions of Republic Act No. 1180 is entitled "An Act to Regulate the Retail Business." In effect it nationalizes the retail trade business. 1180 Republic Act No. rooted in the drive and urge for national survival and welfare. The enactment poses questions of due process.This Court has before it the delicate task of passing upon the validity and constitutionality of a legislative enactment. partnerships. and within the field of economy it regulates. not citizens of the Philippines. police power and equal protection of the laws. and positive nationalistic impulse. so that the country and the nation may be free from a supposed economic dependence and bondage. The main provisions of the Act are: (1) a prohibition against persons. Admittedly springing from a deep. 1954. the law purports to protect citizen and country from the alien retailer. Do the facts and circumstances justify the enactment? II. fundamental and far-reaching in significance. and against associations. Congress attempts to translate national aspirations for economic independence and national security. militant. Through it. or corporations the capital of which are not wholly owned by citizens of the Philippines. from engaging directly or indirectly in the retail trade.

No. and (7) a provision allowing the heirs of aliens now engaged in the retail business who die. commerce and industry. giving. the nature of the business. their assets and liabilities and their offices and principal offices of judicial entities. (3) an exception therefrom in favor of citizens and juridical entities of the United States. Grounds upon which petition is based-Answer thereto Petitioner. to continue such business for a period of six months for purposes of liquidation. (6) a provision requiring aliens actually engaged in the retail business to present for registration with the proper authorities a verified statement concerning their businesses. . 1180. unless their licenses are forfeited in accordance with the law. for and in his own behalf and on behalf of other alien residents corporations and partnerships adversely affected by the provisions of Republic Act. and to enjoin the Secretary of Finance and all other persons acting under him.continue to engaged therein. (5) a prohibition against the establishment or opening by aliens actually engaged in the retail business of additional stores or branches of retail business. and for ten years after the approval of the Act or until the expiration of term in case of juridical persons. III. brought this action to obtain a judicial declaration that said Act is unconstitutional. among other matters. (4) a provision for the forfeiture of licenses (to engage in the retail business) for violation of the laws on nationalization. control weights and measures and labor and other laws relating to trade. until their death or voluntary retirement in case of natural persons.

the Solicitor-General and the Fiscal of the City of Manila contend that: (1) the Act was passed in the valid exercise of the police power of the State. — . (3) the Act violates international and treaty obligations of the Republic of the Philippines. Petitioner attacks the constitutionality of the Act. The police power. which exercise is authorized in the Constitution in the interest of national economic survival. Preliminary consideration of legal principles involved a. violate the spirit of Sections 1 and 5. (2) the subject of the Act is not expressed or comprehended in the title thereof. and the institution of inheritance is only of statutory origin. (4) the provisions of the Act against the transmission by aliens of their retail business thru hereditary succession. IV. from enforcing its provisions. (2) the Act has only one subject embraced in the title. In answer. only the form is affected but the value of the property is not impaired.particularly city and municipal treasurers. (4) as regards hereditary succession. Article XIII and Section 8 of Article XIV of the Constitution. and those requiring 100% Filipino capitalization for a corporation or entity to entitle it to engage in the retail business. contending that: (1) it denies to alien residents the equal protection of the laws and deprives of their liberty and property without due process of law . (3) no treaty or international obligations are infringed.

reaching in scope. and how are the due process and equal protection clauses related to it? What is the province and power of the legislature. the most essential. just as the fields of public . What is the scope of police power. It has been said the police power is so far . that it has become almost impossible to limit its sweep. As it derives its existence from the very existence of the State itself. Especially is it so under a modern democratic framework where the demands of society and of nations have multiplied to almost unimaginable proportions. it would be well to bear in mind certain basic and fundamental. But before proceeding to the consideration and resolution of the ultimate issue involved. and what is the function and duty of the courts? These consideration must be clearly and correctly understood that their application to the facts of the case may be brought forth with clarity and the issue accordingly resolved. it is said to be co-extensive with self-protection and survival. the field and scope of police power has become almost boundless. and as such it is the most positive and active of all governmental processes. insistent and illimitable. considerations in the determination of the ever recurrent conflict between police power and the guarantees of due process and equal protection of the laws. it does not need to be expressed or defined in its scope. but petitioner claims that its exercise in this instance is attended by a violation of the constitutional requirements of due process and equal protection of the laws. albeit preliminary.There is no question that the Act was approved in the exercise of the police power.

as we cannot foresee the needs and demands of public interest and welfare in this constantly changing and progressive world. — The basic limitations of due process and equal protection are found in the following provisions of our Constitution: SECTION 1. ed. liberty or property without due process of law. 220. L. Limitations on police power. Phil. Constitution) These constitutional guarantees which embody the essence of individual liberty and freedom in democracies. nor any person be denied the equal protection of the laws. of color.interest and public welfare have become almost all-embracing and have transcended human foresight. Otherwise stated. (Article III. Hopkins. (Yick Wo vs. 30. what they do is to set forth the limitations thereof. b. are not limited to citizens alone but are admittedly universal in their application. 226. So it is that Constitutions do not define the scope or extent of the police power of the State.(1) No person shall be deprived of life.) . without regard to any differences of race. so we cannot delimit beforehand the extent or scope of police power by which and through which the State seeks to attain or achieve interest or welfare. or of nationality. The most important of these are the due process clause and the equal protection clause.

if it applies alike to all persons within such class. The.c. and reasonable grounds exists for making a distinction between those who fall within such class and those who do not. is it not unreasonable. 824-825. Is there public interest. Constitutional Limitations. as well as hostile discrimination or the oppression of inequality. — The due process clause has to do with the reasonableness of legislation enacted in pursuance of the police power. The equal protection clause is not infringed by legislation which applies only to those persons falling within a specified class. — The equal protection of the law clause is against undue favor and individual or class privilege. it merely requires that all persons shall be treated alike. (2 Cooley. under like circumstances and conditions both as to privileges conferred and liabilities enforced. It does not demand absolute equality among residents. a public purpose. It is not intended to prohibit legislation. equal protection clause. is public welfare involved? Is the Act reasonably necessary for the accomplishment of the legislature's purpose.) d. The due process clause. arbitrary or oppressive? Is there sufficient foundation or reason in connection with the matter . which is limited either in the object to which it is directed or by territory within which is to operate.

whoever exercise it. or has there not been a capricious use of the legislative power? Can the aims conceived be achieved by the means used. the power and the guarantees are supposed to coexist. what is the proper place and role of the courts? It must not be overlooked. therefore. for that would be tyranny. Yet there can neither be absolute liberty. shall it be said. for that would mean license and anarchy. The conflict. in this matter of equitable balancing. provided there is due process of law. And if distinction and classification has been made. the indispensable means for the attainment of legitimate aspirations of any democratic society. and a reasonable relation must exist between purposes and means. as always. The balancing is the essence or. between police power and the guarantees of due process and equal protection of the laws is more apparent than real. There can be no absolute power. or is it not merely an unjustified interference with private interest? These are the questions that we ask when the due process test is applied. and persons may be classified into classes and groups. Legislative discretion not subject to judicial review. provided everyone is given the equal protection of the law. in the first place. The test or standard. — Now.involved. . liberty and property. e. The police power legislation must be firmly grounded on public interest and welfare. there must be a reasonable basis for said distinction. So the State can deprive persons of life. is reason. Properly related.

adequacy or reasonableness and wisdom. color or citizenship. Economic problems sought to be remedied With the above considerations in mind. the aliens. of any law promulgated in the exercise of the police power. Moreover. On the other hand. which is the constitutional repository of police power and exercises the prerogative of determining the policy of the State. there would be no question that it falls within the legitimate scope of legislative power. . courts are not supposed to override legitimate policy. They have done so early where there has been a clear. or of the measures adopted to implement the public policy or to achieve public interest. irrespective of race. But it goes further and prohibits a group of residents. If the disputed legislation were merely a regulation. is by force of circumstances primarily the judge of necessity. which from the immemorial has always been open to residents.that the legislature. patent or palpable arbitrary and unreasonable abuse of the legislative prerogative. as old as society itself. from engaging therein. although zealous guardians of individual liberty and right. V. as its title indicates. and courts never inquire into the wisdom of the law. have nevertheless evinced a reluctance to interfere with the exercise of the legislative prerogative. we will now proceed to delve directly into the issue involved. The problem becomes more complex because its subject is a common. courts. trade or occupation.

But as group life develops and families begin to live in communities producing more than what they consume and needing an infinite number of things they do not produce. the dealer's importance is enhanced. Retail dealers perform the functions of capillaries in the human body. the salt.a. in which man's needs have multiplied and diversified to unlimited extents and proportions. Under modern conditions and standards of living. even the needle and the thread to sew them or darn the clothes that wear out. the dealer comes into existence. the retailer comes as essential as the producer. the fish. the vinegar. — In a primitive economy where families produce all that they consume and consume all that they produce. because thru him the infinite variety of articles. He has cloths to sell. He provides his customers around his store with the rice or corn. food in all its increasing forms. goods and needed for daily life are placed within the easy reach of consumers. He ministers to the resident's daily needs. The retailer. and the various little gadgets and things needed for home and daily life. is unknown. There cannot be any question about the importance of the retailer in the life of the community. Importance of retail trade in the economy of the nation. therefore. from the lowly peddler. the owner of a small . the spices needed for the daily cooking. As villages develop into big communities and specialization in production begins. of course. thru which all the needed food and supplies are ministered to members of the communities comprising the nation. the dealer.

He has shown in this trade. and the patience and forbearance of a slave. The alien retailer's trait. Alleged alien control and dominance. Slowly but gradually be invaded towns and villages. and he forgets and forgives. — The alien retailer must have started plying his trades in this country in the bigger centers of population (Time there was when he was unknown in provincial towns and villages). — .sari-sari store. He even pioneers. b. Derogatory epithets are hurled at him. c. industry without limit. as he appears to be harmless and extremely useful. insults of ill-bred and insolent neighbors and customers are made in his face. The community takes note of him. but he laughs these off without murmur. ministering to the daily needs of the residents and purchasing their agricultural produce for sale in the towns. in far away nooks where the beginnings of community life appear. but he heeds them not. It is an undeniable fact that in many communities the alien has replaced the native retailer. now he predominates in the cities and big centers of population. a supermarket is so much a part of day-to-day existence. to the operator of a department store or.

sugar. garlic. Food and other essentials. Between the constitutional convention year (1935). in another. which put down the figures in black and white.There is a general feeling on the part of the public. his control over principal foods and products would easily become full and complete. Petitioner denies that there is alien predominance and control in the retail trade. the Namarco. but apparent control over distribution of almost all kinds of goods. groceries. hardware. flour. such as lumber. In one breath it is said that the fear is unfounded and the threat is imagined. The first argument which brings up an issue of fact merits serious consideration. Alienage. The others are matters of opinion within the exclusive competence of the legislature and beyond our prerogative to pass upon and decide. almost all articles of daily life reach the residents mostly through him. textiles. the Facomas and the Acefa. about the controlling and dominant position that the alien retailer holds in the nation's economy. also so many unmanageable factors in the retail business make control virtually impossible. The best evidence are the statistics on the retail trade. In big cities and centers of population he has acquired not only predominance. clothing. drugs. it is charged that the law is merely the result of radicalism and pure and unabashed nationalism. and scores of other goods and articles. when the fear of alien domination and control of the retail trade already filled the minds of our leaders with . And were it not for some national corporations like the Naric. is not an element of control. which appears to be true to fact. it is said.

official statistics unmistakably point out to the ever-increasing dominance and control by the alien of the retail trade.fears and misgivings. and the year of the enactment of the nationalization of the retail trade act (1954). as witness the following tables: Assets Gross Sales Year and Retailers Nationality No.-Establishments Pesos .

Per cent Distribution Pesos Per cent Distribution 1941: .

74 ......323.Filipino .. 106.138 55..82 174.671 200..181..924 51.

.Chinese ...21 ..813.356 118.98 148..692 32....239 44... 15.348.

. 1.20 13...630.239 4...090 11..05 1947: .187......Others .646 40.

111......107 ..Filipino ....

.208..658...05 279... 13.333 57..03 Chinese ...218 .946 65..774 106.583.156.

.761. 354 8...701...56 205.260 ..33.96 Others ..134 41....

927.168 1.49 4.01 1948: (Census) ..

113....161.Filipino .667 .30 467.631 213....264 67....342.

20 ....38 294.227 38..155.087 93...51 Chinese .60.894.459 29.. 12...

402 1..29 .Others .675 3.995.... 422 10.32 9..514.....

... 113.659 ..1949: Filipino ......

.89 462.451.213.602 60...532... 16.248 .47 Chinese ..901 53....

.36 Others .414.72 392.....875 45..223.336 35... 486 12..056.365 .125.

3.078.364 1.17 1951: .39 10.

...Filipino ..058.09 466.352 224....053. 119.620 61..052 .

429 134..53.384 46...481...303 36.325.07 Chinese .. 17..60 404...06 .

614.025 2....645... 347 8.31 7..Others ..327 87 ...

AVERAGE ASSETS AND GROSS SALES PER ESTABLISHMENT Year and Retailer's Nationality Item Assets (Pesos) Gross Sales (Pesos) 1941: .

..............................Filipino ..................707 ...... 7.....878 1...........633 Chinese .... 1.....................

.415 8............9................. 24.....281 1947: ......691 Others ..........

.....................Filipino ..............934 .... 1......................................516 Chinese .707 14. 7.............878 2.

..............Others ............ .... 24...............................919 1948: (Census) Filipino .........................749 13........

111 Chinese .... 7.........................707 24....................398 Others ..................... ...................1......878 4.

.916 23..24..............686 1949: Filipino ........... 1...878 ..................

..................... 7..........4............069 Chinese ........152 Others ..807 ...707 24............. 24............................

........877 3............. 1....737 1951: Filipino ..........905 ........20......

......... 7...........Chinese ................707 33.......................824 22...............207 Others .........033 ............. 24.

18-19 of Answer. It is true. of course. the native investment is thinly spread. As observed by respondents. The above figures reveal that in percentage distribution of assests and gross sales. . Numbers in retailers.) The above statistics do not include corporations and partnerships. but aliens more than make up for the numerical gap through their assests and gross sales which average between six and seven times those of the very many Filipino retailers. do not imply superiority. buys and sells six to seven times more.(Estimated Assets and Gross Sales of Retail Establishments. pp. The same official report. credit. Department of Commerce and Industry. and gains much more. and the Filipino retailer is practically helpless in matters of capital.. the alien invests more capital. here. Benchmark: 1948 Census. By Year and Nationality of Owners. issued by the Bureau of Census and Statistics. whose capital is necessarily small. price and supply. remarks that the Filipino retailers were largely engaged in minor retailer enterprises. pointing out to the known predominance of foreign elements in the retail trade. alien participation has steadily increased during the years. that Filipinos have the edge in the number of retailers. while the figures on Filipino establishments already include mere market vendors.

. he says: But there has been a general feeling that alien dominance over the economic life of the country is not desirable and that if such a situation should remain. . 10th ed.. and the events since then have not been either pleasant or comforting. and analyzing the concern of the members of the constitutional convention for the economic life of the citizens. — It is this domination and control. ." (II Aruego. The Framing of the Philippine Constitution. subject of apprehension in Constitutional convention. that is the legislature's target in the enactment of the disputed nationalization would never have been adopted. Alien control and threat. Political Law. that "it is the sense of the Convention that the public interest requires the nationalization of the retail trade. 114). political independence alone is no guarantee . commenting on the patrimony clause of the Preamble opines that the fathers of our Constitution were merely translating the general preoccupation of Filipinos "of the dangers from alien interests that had already brought under their control the commercial and other economic activities of the country" (Sinco. quoted on page 67 of Petitioner.d. in connection with the nationalistic provisions of the Constitution. Dean Sinco of the University of the Philippines College of Law. p. .) That was twenty-two years ago. The framers of our Constitution also believed in the existence of this alien dominance and control when they approved a resolution categorically declaring among other things. which we believe has been sufficiently shown to exist. 662-663. Phil.

) Belief in the existence of alien control and predominance is felt in other quarters. . timid and hesitant. and they express sentiments of economic independence. p. and felt by all the sections and groups that compose the Filipino community. find alien domination and control to be a fact. . so our newspapers.to national stability and strength. Filipino private capital is not big enough to wrest from alien hands the control of the national economy. (Phil. We. Thus . which have editorially pointed out not only to control but to alien stranglehold. the government as the instrumentality of the national will. approved on March 20. largely inexperienced. Political Law by Sinco. 10th ed. in the struggle for the economic freedom of the nation in somewhat the same way that it did in the crusade for political freedom. and fears. it is but of recent formation and hence. . 1953. alien predominance and control. 1. 476. approved on July 18. and a similar resolution. 1954. they fear the dangers coming from alien control. of the Second National Convention of Manufacturers and Producers. of the Fifth National convention of Filipino Businessmen. if not the leadership. Under such conditions. it (the Constitution) envisages an organized movement for the protection of the nation not only against the possibilities of armed invasion but also against its economic subjugation by alien interests in the economic field. has to step in and assume the initiative. Moreover.. Witness thereto is Resolution No. The man in the street also believes. Filipino businessmen. manufacturers and producers believe so. a reality proved by official statistics. therefore.

that fears of dislocation of the national economy and of the complete subservience of national economy and of the consuming public are not entirely unfounded. eliminating it from their stocks. offering the new one as a substitute. This is easily illustrated. Hence. or its consumers. alien retailers and merchants can act in such complete unison and concert on such vital matters as the fixing of prices. producers and consumers alike can be placed completely at their mercy. Freedom of trade is thus curtailed and free enterprise correspondingly suppressed. there is a prevailing feeling that such predominance may truly endanger the national interest. because the producer or importer does not offer them sufficient profits. or because a new competing article offers bigger profits for its introduction. Dangers of alien control and dominance in retail. With ample capital. or its consumers. Suppose an article of daily use is desired to be prescribed by the aliens. Nationals. the determination of the amount of goods or articles to be made available in the market. find the article suddenly out of circulation. the producers or importers of the prescribed article.e. and even the choice of the goods or articles they would or would not patronize or distribute. All that aliens would do is to agree to refuse to sell the first article. — But the dangers arising from alien participation in the retail trade does not seem to lie in the predominance alone. . unity of purpose and action and thorough organization. find the article suddenly out of the prescribed article.

that they have connived to boycott honest merchants and traders who would not cater or yield to their demands. that they have hoarded essential foods to the inconvenience and prejudice of the consuming public. They are believed by the public to have evaded tax laws. that they have violated price control laws. in unlawful restraint of freedom of trade and enterprise. that at some time or other they have cornered the market of essential commodities. that there exists a general feeling on the part of the public that alien participation in the retail trade has been attended by a pernicious and intolerable practices. control laws and the like. authorizing their immediate and automatic deportation for price control convictions. especially on foods and essential commodities. like corn and rice. indirectly . such that the legislature had to enact a law (Sec. 9. 1168). which courts of justice may not properly overlook or ignore in the interests of truth and justice. It is a fact within judicial notice. so much so that the Government has had to establish the National Rice and Corn Corporation to save the public from their continuous hoarding practices and tendencies. cheating the operation of the law of supply and demand. creating artificial scarcities to justify and enhance profits to unreasonable proportions. violated import and export prohibitions.We can even go farther than theoretical illustrations to show the pernicious influences of alien domination. in derision and contempt of lawful authority. that they have secret combinations among themselves to control prices. the mention of a few of which would suffice for our purposes. It is also believed that they have engaged in corrupting public officials with fabulous bribes. Republic Act No. Grave abuses have characterized the exercise of the retail trade by aliens. smuggled goods and money into and out of the land.

The present dominance of the alien retailer. The circumstances above set forth create well founded fears that worse things may come in the future. We do not have here in this country isolated groups of harmless aliens retailing goods among nationals. As a matter of fact appeals to unscrupulous aliens have been made both by the Government and by their own lawful diplomatic representatives. therefore. his person and his property subject to the needs of his country. but the expression of the . especially in the big centers of population. While the national holds his life. — We are fully satisfied upon a consideration of all the facts and circumstances that the disputed law is not the product of racial hostility. and the State cannot rely upon them in times of crisis or emergency. prejudice or discrimination. Law enacted in interest of national economic survival and security. They owe no allegiance or loyalty to the State. action which impliedly admits a prevailing feeling about the existence of many of the above practices. what we have are well organized and powerful groups that dominate the distribution of goods and commodities in the communities and big centers of population. the alien may even become the potential enemy of the State. f. becomes a potential source of danger on occasions of war or other calamity.causing the prevalence of graft and corruption in the Government.

The Equal Protection Limitation a. The law is clearly in the interest of the public. his stay here is for personal convenience. thru which and by which the State insures its existence and security and the supreme welfare of its citizens. we admit. is neither illegitimate nor immoral. The faster he makes his pile. to free the nation from the economic situation that has unfortunately been saddled upon it rightly or wrongly. His aim or purpose of stay. but he is naturally lacking in that spirit of loyalty and enthusiasm for this country where he temporarily stays and makes his living. or of that spirit of regard. sympathy and consideration for his Filipino customers as would prevent him from taking advantage of their weakness and exploiting them. The alien resident owes allegiance to the country of his birth or his adopted country. the mere fact of alienage is the root and cause of the distinction between the alien and the national as a trader. he is attracted by the lure of gain and profit. Does the law deny the equal protection of the laws? As pointed out above. Objections to alien participation in retail trade. VI. nay of the national security itself. the earlier can the alien go back to his beloved country and his beloved kin and countrymen. and indisputably falls within the scope of police power. — The next question that now poses solution is. thru their authorized representatives. The experience of the country is that the alien retailer has shown such utter disregard for his customers and the . to its disadvantage.legitimate desire and determination of the people.

people on whom he makes his profit. their utter disregard of the welfare of their customers and of the ultimate happiness of the people of the nation of which they are mere guests. positive and fundamental differences between an alien and a national which fully justify the legislative classification adopted in the retail trade measure. These differences are certainly a valid reason for the State to prefer the national over the alien in the retail trade. radical as it may seem. . We would be doing violence to fact and reality were we to hold that no reason or ground for a legitimate distinction can be found between one and the other. it would indeed be ill-advised to continue entrusting the very important function of retail distribution to his hands. show the existence of real and actual. The practices resorted to by aliens in the control of distribution. as already pointed out above. that it has been found necessary to adopt the legislation. The alien's interest in this country being merely transient and temporary. Another objection to the alien retailer in this country is that he never really makes a genuine contribution to national income and wealth. He undoubtedly contributes to general distribution. their secret manipulations of stocks of commodities and prices. but the gains and profits he makes are not invested in industries that would help the country's economy and increase national wealth. which practices. manipulations and disregard do not attend the exercise of the trade by the nationals.

and a law can be violative of the constitutional limitation only when the classification is without reasonable basis. 369. that this is the prerogative of the law-making power. To this we answer. we can also refer to the case of Linsey vs. the power of the legislature to make distinctions and classifications among persons is not curtailed or denied by the equal protection of the laws clause. real and reasonable. which clearly and succinctly defined the application of equal protection clause to a law sought to be voided as contrary thereto: . Difference in alien aims and purposes sufficient basis for distinction. The legislative power admits of a wide scope of discretion. it is in duty bound to declare that the legislature acted within its legitimate prerogative and it can not declare that the act transcends the limit of equal protection established by the Constitution. and all persons of one class are treated alike. In addition to the authorities we have earlier cited. — The above objectionable characteristics of the exercise of the retail trade by the aliens. ed. 55 L.. furnish sufficient grounds for legislative classification of retail traders into nationals and aliens. (1911).b. which are actual and real. Broadly speaking. Some may disagree with the wisdom of the legislature's classification. Since the Court finds that the classification is actual. Natural Carbonic Fas Co. and as it cannot be said that the classification is patently unreasonable and unfounded.

it was held that the Philippine Legislature did not violate the equal . the existence of that state of facts at the time the law was enacted must be assumed. — The question as to whether or not citizenship is a legal and valid ground for classification has already been affirmatively decided in this jurisdiction as well as in various courts in the United States. A classification having some reasonable basis does not offend against that clause merely because it is not made with mathematical nicety. 136. . where the validity of Act No. because of a condition therein limiting the ownership of vessels engaged in coastwise trade to corporations formed by citizens of the Philippine Islands or the United States. 3. 2761 of the Philippine Legislature was in issue. In the case of Smith Bell & Co. The equal protection clause of the Fourteenth Amendment does not take from the state the power to classify in the adoption of police laws. Authorities recognizing citizenship as basis for classification. One who assails the classification in such a law must carry the burden of showing that it does not rest upon any reasonable basis but is essentially arbitrary. if any state of facts reasonably can be conceived that would sustain it. and avoids what is done only when it is without any reasonable basis. "1. ." c. thus denying the right to aliens.. but admits of the exercise of the wide scope of discretion in that regard. 4. When the classification in such a law is called in question. 40 Phil. 2. Natividad. vs. and therefore is purely arbitrary. or because in practice it results in some inequality. .

. that the license is granted. that effect has been correctly attributed to the act of her enrollment. that this whole system is projected. 9 Wheat. and to preserve the Government from fraud by foreigners. in fact. retailers of spirituous liquors. and place them on an equal footing with the shipping of other nations. and a countervailing privilege in favor of American shipping is contemplated. It is not to give the vessel an American character. the object of which is to encourage American shipping. is distinctly of that character. and all presumptions are in favor of its constitutionality. The legislature in enacting the law had as ultimate purpose the encouragement of Philippine shipbuilding and the safety for these Islands from foreign interlopers.protection clause of the Philippine Bill of Rights. In substance." . for example. acts licensing gaming houses. as follows: "Licensing acts. are universally restraining acts. The act. I. in legislation. as. in this instance. we held that the limitation of domestic ownership of vessels engaged in coastwise trade to citizens of the Philippines does not violate the equal protection of the law and due process or law clauses of the Philippine Bill of Rights. as well as frauds upon the revenue in the trade coastwise. and forms part of an extensive system. Ogden. in the whole legislation of the United States on this subject. etc. But it is to confer on her American privileges. Almost every commercial nation reserves to its own subjects a monopoly of its coasting trade. in surreptitiously intruding themselves into the American commercial marine. We held that this was a valid exercise of the police power. In rendering said decision we quoted with approval the concurring opinion of Justice Johnson in the case of Gibbons vs. as contra distinguished from foreign.

the difference in status between citizens and aliens constitutes a basis for reasonable classification in the exercise of police power.. (2 Am. which provided that no one can obtain a license unless he is. State. a statute on the licensing of hawkers and peddlers. 1907). 468-469. In Bloomfield vs. E. 99 N. among them aliens. Broadly speaking. to become a citizen of the United States.The rule in general is as follows: Aliens are under no special constitutional protection which forbids a classification otherwise justified simply because the limitation of the class falls along the lines of nationality. or a deliberate purpose to discriminate. good order and happiness of the community. Jur. was found not to be the result of race hatred. 309 (Ohio. 81 N.) In Commonwealth vs. E. That would be requiring a higher degree of protection for aliens as a class than for similar classes than for similar classes of American citizens. Hana. or in hospitality. or has declared his intention. but was based on the belief that an alien cannot be sufficiently acquainted with "our institutions and our life as to enable him to appreciate the relation of this particular business to our entire . and the court cannot question this judgment and conclusion. 149 (Massachusetts. from engaging in the traffic of liquors. a statute which prevented certain persons. for the following reason: It may seem wise to the legislature to limit the business of those who are supposed to have regard for the welfare. was held valid. 1912).

pool. and was not.social fabric".R. 1058 (Michigan. In Asakura vs. but it does not follow that alien race and allegiance may not bear in some instances such a relation to a legitimate object of legislation as to be made the basis of permitted classification. and that it could not state that the legislation is clearly wrong.. Supreme Court had under consideration an ordinance of the city of Cincinnati prohibiting the issuance of licenses (pools and billiard rooms) to aliens. billiard. card room. 1915 P. invalid. 1919) is a parallel case to the one at bar. hence the prohibitions of issuance of licenses to them for the business of pawnbroker. 90 N. 340 (Oregon. In Ohio ex rel. A similar statute denying aliens the right to engage in auctioneering was also sustained in Wright vs. the U. Van Winkle. Clarke vs. The case of State vs. 71 L. dance hall. In Templar vs. or even the convenience of the .S. 129 (Ohio.W. Carrol. therefore. Deckebach. May. It held that plainly irrational discrimination against aliens is prohibited. 1922). and limiting it to citizens is within the scope of police power. City of Seattle. is not an infringement of constitutional rights. 210 P. but the reason for the decision was the court's findings that the exercise of the business by the aliens does not in any way affect the morals. ed. knowledge. 1924). L. So also in Anton vs. E. S. 115 (1926). the court said that aliens are judicially known to have different interests. 1914). 274 U. 30 (Washington. 392. the health. the business of pawn brooking was considered as having tendencies injuring public interest. 151 (Minnesota. Michigan State Board of Examiners. and that latitude must be allowed for the legislative appraisement of local conditions and for the legislative choice of methods for controlling an apprehended evil.A. a law prohibiting the licensing of aliens as barbers was held void. 297 F. 124 N. attitude. 1902). psychology and loyalty.

McConway & Tarley Co. 70 L. In Yu Cong Eng vs.. two Justices dissented on the theory that fishing rights have been treated traditionally as natural resources. 1479 (1947). 1897). was declared void because the court found that there was no reason for the classification and the tax was an arbitrary deduction from the daily wage of an employee. a California statute banning the issuance of commercial fishing licenses to person ineligible to citizenship was held void. It further added that the law was the outgrowth of antagonism toward the persons of Japanese ancestry. the United States Supreme Court declared invalid a Philippine . because the law conflicts with Federal power over immigration. d. ed. — It is true that some decisions of the Federal court and of the State courts in the United States hold that the distinction between aliens and citizens is not a valid ground for classification. ed. In Takahashi vs. 257 (Pennsylvania. Fish and Game Commission. a state law which imposed a tax on every employer of foreign-born unnaturalized male persons over 21 years of age. Trinidad. so there was no adequate justification for the discrimination. 92 L. But in this decision the laws declared invalid were found to be either arbitrary. Authorities contra explained. or were the result or product of racial antagonism and hostility. 1059 (1925). and there was no question of public interest involved or pursued. In Fraser vs. 82 Fed. unreasonable or capricious. and because there is no public interest in the mere claim of ownership of the waters and the fish in them.community. However.

aliens do not naturally possess the sympathetic consideration and regard for the customers with whom they come in daily contact. was declared invalid. but the main reasons for the decisions are: (1) that if Chinese were driven out of business there would be no other system of distribution. In Yick Wo vs. 30 L. nor the loyalty and allegiance which the national owes to the land. 47 A. 1900). Montgomery. nor the patriotic desire to help bolster the nation's economy. that there was no reason for the discrimination which attended the administration and implementation of the law. The case at bar is radically different. because the discrimination bore no reasonable and just relation to the act in respect to which the classification was proposed. a law prohibiting aliens to engage as hawkers and peddlers was declared void. In State vs. 165 (Maine. ed 220 (1885) an ordinance conferring powers on officials to withhold consent in the operation of laundries both as to persons and place.law making unlawful the keeping of books of account in any language other than English. except in so far as it enhances their profit. As we already have said. Spanish or any other local dialect. because they would be deprived of their right to be advised of their business and to direct its conduct. and that the motive thereof was mere racial hostility. The real reason for the decision. is the court's belief that no public benefit would be derived from the operations of the law and on the other hand it would deprive Chinese of something indispensable for carrying on their business. and the facts make them so. These limitations on the qualifications of the aliens have been shown on many . and (2) that the Chinese would fall prey to all kinds of fraud. Hopkins. therefore. but the court said that the power granted was arbitrary.

. The Due Process of Law Limitation. are a part of the government itself. — . 340. . and therefore appropriate discriminations against aliens as it relates to the subject of legislation. a. that alien coming into this country are without the intimate knowledge of our laws. is unnecessary. to drive home the reality and significance of the distinction between the alien and the national. It may be judicially known. it is natural and reasonable to suppose that the foreign born. . . Reasonability. especially in times of crisis and emergency. determination by legislature decisive. . Furthermore.occasions and instances. . So it is likewise known that certain classes of aliens are of different psychology from our fellow countrymen. . as those who by citizenship. whose allegiance is first to their own country. however. the test of the limitation. VII. thus: . We can do no better than borrow the language of Anton vs. Van Winkle. have not the same inspiration for the public weal. and usages that our own people have. nor are they as well disposed toward the United States. 297 F. and whose ideals of governmental environment and control have been engendered and formed under entirely different regimes and political systems. Further enlargement. I have said enough so that obviously it cannot be affirmed with absolute confidence that the Legislature was without plausible reason for making the classification. 342. customs.

957. . ed. And the guaranty of due process. The courts are without authority either to declare such policy. . xxx xxx xxx So far as the requirement of due process is concerned and in the absence of other constitutional restriction a state is free to adopt whatever economic policy may reasonably be deemed to promote public welfare. (Nebbia vs. . to override it. the requirements of due process are satisfied.We now come to due process as a limitation on the exercise of the police power. . and to enforce that policy by legislation adapted to its purpose. 950. New York. . demands only that the law shall not be unreasonable. . . arbitrary or capricious. . and that the means selected shall have a real and substantial relation to the subject sought to be attained. when it is declared by the legislature. 78 L. . as has often been held. 940. It has been stated by the highest authority in the United States that: .) . and judicial determination to that effect renders a court functus officio. and are neither arbitrary nor discriminatory. If the laws passed are seen to have a reasonable relation to a proper legislative purpose. or. .

388. . xxx xxx xxx . . . . as distinguished from those of a particular class. that the means are reasonably . first. and must not be unduly oppressive. A statute to be within this power must also be reasonable in its operation upon the persons whom it affects. . . Sec. (11 Am. . Jur. Too much significance cannot be given to the word "reasonable" in considering the scope of the police power in a constitutional sense. ed.) In the case of Lawton vs. 1:1). it must appear. must not be for the annoyance of a particular class. require such interference. . that the interests of the public generally.. 38 L. and not whether it imposes any restrictions on such rights.Another authority states the principle thus: . . and second. . . Steele. To justify the state in thus interposing its authority in behalf of the public. it was also held: . 302. 385. for the test used to determine the constitutionality of the means employed by the legislature is to inquire whether the restriction it imposes on rights secured to individuals by the Bill of Rights are unreasonable.1074-1075. .

104 ALR. State Board of Embalming.necessary for the accomplishment of the purpose. — Petitioner's main argument is that retail is a common. . one of those privileges long ago recognized as essential to the orderly pursuant of happiness by free men. passed in the exercise of the police power to regulate the operation of a business. ordinary occupation. one of the first questions to be considered by the court is whether the power as exercised has a sufficient foundation in reason in connection with the matter involved. Petitioner's argument considered. 389. oppressive. comfort. . b.. and general welfare of the public. is or is not constitutional.e. Prata Undertaking Co. safety. it has been so engaged by him. 395. fixes this test of constitutionality: In determining whether a given act of the Legislature. and capricious use of that power. without substantial relation to the health. that in this country where the occupation is engaged in by petitioner. or is an arbitrary. and not unduly oppressive upon individuals. i. . vs. that it is a gainful and honest occupation and therefore beyond the power of the legislature to prohibit and penalized. morals. This arguments overlooks fact and reality and rests on an incorrect assumption and premise. by the alien in an honest creditable and .

that he now enjoys a monopolistic control of the occupation and threatens a deadly stranglehold on the nation's economy endangering the national security in times of crisis and emergency. But the Legislature has found.) Judged by this test. therefore.unimpeachable manner. must be considered not to have infringed the constitutional limitation of reasonableness. disputed legislation. Arbitrary capricious. as we have also found and indicated. taking into account the illegitimate and pernicious form and manner in which the aliens have heretofore engaged therein? As thus correctly stated the answer is clear.) The test of reasonableness of a law is the appropriateness or adequacy under all circumstances of the means adopted to carry out its purpose into effect (Id. pp. Jur. It is not necessarily unreasonable because it affects private rights and privileges (11 Am. The law in question is deemed absolutely necessary to bring about the desired legislative objective. i. but this.e. is not that posed by petitioner. thru the illegitimate use of pernicious designs and practices. to free national economy from alien control and dominance. . that the privilege has been so grossly abused by the alien. The real question at issue. 10801081.. Is the exclusion in the future of aliens from the retail trade unreasonable. tranquility and welfare. which overlooks and ignores the facts and circumstances. without harm or injury to the citizens and without ultimate danger to their economic peace. which is not merely reasonable but actually necessary.

even our national security. The approval of this bill is necessary for our national survival. Its purpose is to prevent persons who are not citizens of the Philippines from having a strangle hold upon our economic life. If political independence is a legitimate aspiration of a people. then economic independence is none the less legitimate. we are not really the masters of our destiny. and who have no permanent stake in our people's welfare. All aspects of our life. we do not propose to deprive persons who are not citizens of the Philippines of their means of livelihood. While this bill seeks to take away from the hands of persons who are not citizens of the Philippines a power that can be wielded to paralyze all aspects of our national life and endanger our national security it respects existing rights. In seeking to accomplish the foregoing purpose. If the persons who control this vital artery of our economic life are the ones who owe no allegiance to this Republic. which later was enacted into law: This bill proposes to regulate the retail business.The necessity of the law in question is explained in the explanatory note that accompanied the bill. who have no profound devotion to our free institutions. will be at the mercy of other people. Freedom and liberty are not real and positive if the people are subject to the .

their freedom and liberty. they adopted a resolution expressing their belief that the legislation in question is within the scope of the legislative power. — The framers of the Constitution could not have intended to impose the constitutional restrictions of due process on the attainment of such a noble motive as freedom from economic control and domination. is one of the noblest motives that a national legislature may pursue. The attainment of a legitimate aspiration of a people can never be beyond the limits of legislative authority. c. Law expressly held by Constitutional Convention to be within the sphere of legislative action. thru the exercise of the police power. It is impossible to conceive that legislation that seeks to bring it about can infringe the constitutional limitation of due process.economic control and domination of others. but it abstain from . Thus they declared the their Resolution: That it is the sense of the Convention that the public interest requires the nationalization of retail trade. The removal and eradication of the shackles of foreign economic control and domination. On the precise issue now before us. especially if not of their own race or country. The fathers of the Constitution must have given to the legislature full authority and power to enact legislation that would promote the supreme happiness of the people. they expressly made their voice clear.

invalid and unconstitutional? The seriousness of the Legislature's concern for the plight of the nationals as manifested in the approval of the radical measures is. a principle objective is the conservation of the patrimony of the nation and as corollary the provision limiting to citizens of the Philippines the exploitation. it is provided that "no franchise. and others on this matter because it is convinced that the National Assembly is authorized to promulgate a law which limits to Filipino and American citizens the privilege to engage in the retail trade. Araneta. Thus in the preamble. fully justified. Mr. It would have been recreant to its duties towards the country and its people would it view the sorry plight of the nationals with the complacency and refuse or neglect to adopt a remedy commensurate with the demands of public interest and . or any other form of authorization for the operation of the public utility shall be granted except to citizens of the Philippines. The Framing of the Philippine Constitution.) It would do well to refer to the nationalistic tendency manifested in various provisions of the Constitution. certificate. therefore. development and utilization of its natural resources." The nationalization of the retail trade is only a continuance of the nationalistic protective policy laid down as a primary objective of the Constitution. quoted on pages 66 and 67 of the Memorandum for the Petitioner. And in Section 8 of Article XIV.approving the amendment introduced by the Delegate for Manila. (11 Aruego. Can it be said that a law imbued with the same purpose and spirit underlying many of the provisions of the Constitution is unreasonable.

and every presumption is in favor of its validity. the exercise of legislative discretion is not subject to judicial review. Furthermore. but . the danger and threat that alien domination of retail trade poses to national economy. the test of the validity of a law attacked as a violation of due process. and similar recognition of the right to continue is accorded associations of aliens. The law is made prospective and recognizes the right and privilege of those already engaged in the occupation to continue therein during the rest of their lives. it may not annul the legislation if not palpably in excess of the legislative power. nor pass upon general matters of legislative judgment. Such provision would defeat the law itself. As the repository of the sovereign power of legislation. and though the Court may hold views inconsistent with the wisdom of the law.national survival. the Legislature was in duty bound to face the problem and meet. through adequate measures. Provisions of law not unreasonable. — A cursory study of the provisions of the law immediately reveals how tolerant. In the deliberations of the Court on this case. attention was called to the fact that the privilege should not have been denied to children and heirs of aliens now engaged in the retail trade. It is well settled that the Court will not inquire into the motives of the Legislature. d. The right or privilege is denied to those only upon conviction of certain offenses. Beside. is not its reasonableness. its aims and purposes. The Legislature is primarily the judge of the necessity of an enactment or of any of its provisions. how reasonable the Legislature has been.

as it conceals the real purpose of the bill which is to nationalize the retail business and prohibit aliens from engaging therein. that prices will increase because of the elimination of competition. etc. Alleged defect in the title of the law A subordinate ground or reason for the alleged invalidity of the law is the claim that the title thereof is misleading or deceptive. some of which are: that the law does not promote general welfare. and we find the provisions are not unreasonable. that there may be general breakdown. that thousands of aliens would be thrown out of employment. which reads: No bill which may be enacted in the law shall embrace more than one subject which shall be expressed in the title of the bill.its unreasonableness. that there would be repercussions from foreigners. The constitutional provision which is claimed to be violated in Section 21 (1) of Article VI. that there is no need for the legislation. Many of these arguments are directed against the supposed wisdom of the law which lies solely within the legislative prerogative. they do not import invalidity. that adequate replacement is problematical. These principles also answer various other arguments raised against the law. . VIII.

42 of Answer. quoted in page 41 of Answer. and necessarily implies some degree of restraint and prohibition of acts usually done in . City of Wabash. which terms express the two main purposes and objectives of the law. 7. quoted in p. 48 Ind. Sec. scope and consequences of the law or its operation (I Sutherland. Statutory Construction.What the above provision prohibits is duplicity.) The word "regulate" is of broad import. Both of these have always been included within the term regulation. (Sweet vs. Under the title of an act to "regulate". such matters being properly included within the subject of regulating the sale. 306. 1707." sufficiently expresses the subject of an act prohibiting the sale of such liquors to minors and to persons in the habit of getting intoxicated. State. the Legislature may prohibit the sale of intoxicating liquors. (Williams vs. But "regulate" is a broader term than either prohibition or nationalization. 308. p.) A cursory consideration of the title and the provisions of the bill fails to show the presence of duplicity. 41 Ind. the title to regulate the sale of intoxicating liquors. if its title completely fails to appraise the legislators or the public of the nature. the sale of intoxicating liquors.) Within the meaning of the Constitution requiring that the subject of every act of the Legislature shall be stated in the tale. 297.. etc. that is. It is true that the term "regulate" does not and may not readily and at first glance convey the idea of "nationalization" and "prohibition".

therefore. 42 of Answer. so were the title changed from "regulate" to "nationalize" or "prohibit". quoted in p. In the case at bar it . under which a simple or general term should be adopted in the title.) The general rule is for the use of general terms in the title of a bill. 887. which would include all other provisions found in the body of the Act. Statutory Construction. See. it has also been said that the title need not be an index to the entire contents of the law (I Sutherland. 162 So. the law also contains other rules for the regulation of the retail trade which may not be included in the terms "nationalization" or "prohibition". and prevent the enactment into law of matters which have received the notice. Morton. (State vs. 345. the nature and scope of its provisions. is in accord with the principle governing the drafting of statutes. The use of the term "regulate".) The above rule was followed the title of the Act in question adopted the more general term "regulate" instead of "nationalize" or "prohibit". 4803. One purpose of the constitutional directive that the subject of a bill should be embraced in its title is to apprise the legislators of the purposes. action and study of the legislators or of the public. 718. p. While word regulate does not ordinarily convey meaning of prohibit.connection with the thing to be regulated. there would have been many provisions not falling within the scope of the title which would have made the Act invalid. 182 La. there is no absolute reason why it should not have such meaning when used in delegating police power in connection with a thing the best or only efficacious regulation of which involves suppression. Furthermore.

pp. The objection must therefore. IX. The Law of the United Nations. prohibit foreigners from engaging in retail trade. p.) That such is the import of the United Nations Charter aid of the Declaration of Human Rights can be inferred the fact that members of the United Nations Organizations. . be overruled. Alleged violation of international treaties and obligations Another subordinate argument against the validity of the law is the supposed violation thereby of the Charter of the United Nations and of the Declaration of the Human Rights adopted by the United Nations General Assembly. We find no merit in the Nations Charter imposes no strict or legal obligations regarding the rights and freedom of their subjects (Hans Kelsen.cannot be claimed that the legislators have been appraised of the nature of the law. 1951 ed. It cannot be claimed. and the Declaration of Human Rights contains nothing more than a mere recommendation or a common standard of achievement for all peoples and all nations (Id. that the reasons for declaring the law invalid ever existed. therefore. especially the nationalization and the prohibition provisions. and in most nations of the world laws against foreigners engaged in domestic trade are adopted. and a great many of the persons affected by the prohibitions in the law conducted a campaign against its approval. 39. The legislators took active interest in the discussion of the law. 29-32). such as Norway and Denmark.

that the enactment clearly falls within the scope of the police power of the State. 539. S. All that the treaty guarantees is equality of treatment to the Chinese nationals "upon the same terms as the nationals of any other country. are all prohibited from engaging in the retail trade. who are granted special rights by the Constitution. and the same may never curtail or restrict the scope of the police power of the State (plaston vs." But the nationals of China are not discriminating against because nationals of all other countries. nor the due process of law clause. the treaty is always subject to qualification or amendment by a subsequent law (U. ed. thru which and by which it protects its own personality and insures its security and future. 257. vs. 258. except those of the United States. But even supposing that the law infringes upon the said treaty. Pennsylvania. 1947 is also claimed to be violated by the law in question. because the law is prospective in operation and recognizes the privilege of aliens . Conclusion Resuming what we have set forth above we hold that the disputed law was enacted to remedy a real actual threat and danger to national economy posed by alien dominance and control of the retail business and free citizens and country from dominance and control. Fed. that the law does not violate the equal protection clause of the Constitution because sufficient grounds exist for the distinction between alien and citizen in the exercise of the occupation regulated.) X. 260).The Treaty of Amity between the Republic of the Philippines and the Republic of China of April 18. 58 L. Thompson.

that the wisdom and efficacy of the law to carry out its objectives appear to us to be plainly evident — as a matter of fact it seems not only appropriate but actually necessary — and that in any case such matter falls within the prerogative of the Legislature. however. The petition is hereby denied. Our legal duty. . with costs against petitioner. Thus it is stated that the more time should have been given in the law for the liquidation of existing businesses when the time comes for them to close. and that it cannot be said to be void for supposed conflict with treaty obligations because no treaty has actually been entered into on the subject and the police power may not be curtailed or surrendered by any treaty or any other conventional agreement. Remedies against the harshness of the law should be addressed to the Legislature. with whose power and discretion the Judicial department of the Government may not interfere. Some members of the Court are of the opinion that the radical effects of the law could have been made less harsh in its impact on the aliens. and this suffers from no duplicity and has not misled the legislators or the segment of the population affected. they are beyond our power and jurisdiction.already engaged in the occupation and reasonably protects their privilege. that the provisions of the law are clearly embraced in the title. is merely to determine if the law falls within the scope of legislative authority and does not transcend the limitations of due process and equal protection guaranteed in the Constitution.

1989 DEPARTMENT OF EDUCATION. 2012 Republic of the Philippines SUPREME COURT Manila EN BANC G. . in her capacity as Presiding Judge of the Regional Trial Court of Valenzuela. No. Metro Manila.R. CULTURE AND SPORTS (DECS) and DIRECTOR OF CENTER FOR EDUCATIONAL MEASUREMENT. vs. November 17. petitioners. Branch 172. 89572 December 21. SAN DIEGO and JUDGE TERESITA DIZONCAPULONG. respondents.lawphil Today is Saturday. ROBERTO REY C.

The private respondent insists he can. on constitutional grounds. The petitioner contends he may not. The question is whether a person who has thrice failed the National Medical Admission Test (NMAT) is entitled to take it again.Ramon M. a student shall not be allowed to take the NMAT for the fourth time. J. CRUZ. . under its rule that- h) A student shall be allowed only three (3) chances to take the NMAT. After three (3) successive failures.: The issue before us is mediocrity. But first the facts. Guevara for private respondent.

Metro Manila.The private respondent is a graduate of the University of the East with a degree of Bachelor of Science in Zoology. In his original petition for mandamus. 1 When he applied to take it again. 2 In an amended petition filed with leave of court. he first invoked his constitutional rights to academic freedom and quality education. By agreement of the parties. he squarely challenged the constitutionality of MECS Order No. 1989. to compel his admission to the test. 12. the private respondent was allowed to take the NMAT scheduled on April 16. After hearing. Series of 1972. containing the above-cited rule. The petitioner claims that he took the NMAT three times and flunked it as many times. . Judge Teresita Dizon-Capulong held that the petitioner had been deprived of his right to pursue a medical education through an arbitrary exercise of the police power. the petitioner rejected his application on the basis of the aforesaid rule. 1989. The additional grounds raised were due process and equal protection. He then went to the Regional Trial Court of Valenzuela. 3 We cannot sustain the respondent judge. Her decision must be reversed. subject to the outcome of his petition. the respondent judge rendered a decision on July 4. declaring the challenged order invalid and granting the petition.

. legislation and administrative regulations requiring those who wish to practice medicine first to take and pass medical board examinations have long ago been recognized as valid exercises of governmental power. 1985. is also well recognized. on the other hand. s. the establishment of minimum medical educational requirements-i. This question is perhaps most usefully approached by recalling that the regulation of the pratice of medicine in all its branches has long been recognized as a reasonable method of protecting the health and safety of the public. 4 this Court upheld the constitutionality of the NMAT as a measure intended to limit the admission to medical schools only to those who have initially proved their competence and preparation for a medical education.In Tablarin v. Justice Florentino P. What we have before us in the instant case is closely related: the regulation of access to medical schools. . Gutierrez. Similarly. 52. MECS Order No. Feliciano declared for a unanimous Court: Perhaps the only issue that needs some consideration is whether there is some reasonable relation between the prescribing of passing the NMAT as a condition for admission to medical school on the one hand. the completion of prescribed courses in a recognized medical school-for admission to the medical profession. Thus. and the securing of the health and safety of the general community. has also been sustained as a legitimate exercise of the regulatory authority of the state.e. as noted earlier. That the power to regulate and control the practice of medicine includes the power to regulate admission to the ranks of those authorized to practice medicine.

we are entitled to hold that the NMAT is reasonably related to the securing of the ultimate end of legislation and regulation in this area. The need to maintain. for instance. and the difficulties of maintaining. . and taking into account the failure or inability of the petitioners to even attempt to prove otherwise. it is useful to recall. among other things. medical schools in the United States of America (the Medical College Admission Test [MCAT] and quite probably. That upgrading is sought by selectivity in the process of admission. in other countries with far more developed educational resources than our own. are widely known. in the current state of our social and economic development. That end. is the protection of the public from the potentially deadly effects of incompetence and ignorance in those who would undertake to treat our bodies and minds for disease or trauma. selectivity consisting. high standards in our professional schools in general. We believe that the government is entitled to prescribe an admission test like the NMAT as a means of achieving its stated objective of "upgrading the selection of applicants into [our] medical schools" and of "improv[ing] the quality of medical education in the country. by upgrading the quality of those admitted to the student body of the medical schools." Given the widespread use today of such admission tests in.articulates the rationale of regulation of this type: the improvement of the professional and technical quality of the graduates of medical schools. of limiting admission to those who exhibit in the required degree the aptitude for medical studies and eventually for medical practice. and medical schools in particular.

the proper exercise of the police power requires the concurrence of a lawful subject and a lawful method. indeed with more reliability. This may be gauged at least initially by the admission test and. 5 In other words." We see no reason why the rationale in the Tablarin case cannot apply to the case at bar. as distinguished from those of a particular class. There is no need to redefine here the police power of the State. and (b) the means employed are reasonably necessary to the attainment of the object sought to be accomplished and not unduly oppressive upon individuals. The latter cannot be regarded any less valid than the former in the regulation of the medical profession. . Her reason was that it upheld only the requirement for the admission test and said nothing about the socalled "three-flunk rule. The issue raised in both cases is the academic preparation of the applicant. require the interference of the State. by the threeflunk rule.However. the respondent judge agreed with the petitioner that the said case was not applicable. Suffice it to repeat that the power is validly exercised if (a) the interests of the public generally.

The method employed by the challenged regulation is not irrelevant to the purpose of the law nor is it arbitrary or oppressive. These resources must be applied in a manner that will best promote the common good while also giving the individual a sense of satisfaction. and the closer the link. the longer the bridge to one's ambition. Of course. If one who wants to be a lawyer may prove better as a plumber. he may not be forced to be a plumber. This is true of any other calling in which the public interest is involved. no less worse.The subject of the challenged regulation is certainly within the ambit of the police power. a student who has . The State has the responsibility to harness its human resources and to see to it that they are not dissipated or. he does not have a constitutional right to be a doctor. By the same token. The threeflunk rule is intended to insulate the medical schools and ultimately the medical profession from the intrusion of those not qualified to be doctors. A person cannot insist on being a physician if he will be a menace to his patients. he should be so advised and adviced. It is the right and indeed the responsibility of the State to insure that the medical profession is not infiltrated by incompetents to whom patients may unwarily entrust their lives and health. While every person is entitled to aspire to be a doctor. but on the other hand he may not force his entry into the bar. not used at all.

There can be no question that a substantial distinction exists between medical students and other students who are not subjected to the NMAT and the three-flunk rule. The right to quality education invoked by the private respondent is not absolute. while belonging to an equally respectable profession. The medical profession directly affects the very lives of the people. however appropriate this career may be for others. do not require more vigilant regulation. The accountant. for this reason. Where even those who have qualified may still not be accommodated in our already crowded medical schools. like him. The Constitution also provides that "every citizen has the right to choose a profession or course of study. Section 1 of the Constitution. 6 The private respondent must yield to the challenged rule and give way to those better prepared. subject to fair. . unlike other careers which. A law does not have to operate with equal force on all persons or things to be conformable to Article III. reasonable and equitable admission and academic requirements. there is all the more reason to bar those who. for example. have been tested and found wanting. The contention that the challenged rule violates the equal protection clause is not well-taken.demonstrated promise as a pianist cannot be shunted aside to take a course in nursing.

There would be unequal protection if some applicants who have passed the tests are admitted and others who have also qualified are denied entrance. 7 While his persistence is noteworthy. he may be a bungler or at least lackluster. not for the medical profession. The Court feels that it is not enough to simply invoke the right to quality education as a guarantee of the Constitution: one must show that he is entitled to it because of his preparation and promise. The private respondent has failed the NMAT five times. In the former. to say the least. In other words. what the equal protection requires is equality among equals. It is stressed that a person who does not qualify in the NMAT is not an absolute incompetent unfit for any work or occupation. it is certainly misplaced. The only inference is that he is a probably better. he is more likely to succeed and may even be outstanding. in the latter. No depreciation is intended or made against the private respondent. It is for the appropriate calling that he is entitled to quality education for . like a hopeless love. but for another calling that has not excited his interest.does not hold the same delicate responsibility as that of the physician and so need not be similarly treated.

Paras. Fernan. Gancayco. the petition is GRANTED. of dentists who should never have left the farm and engineers who should have studied banking and teachers who could be better as merchants. concur. We cannot have a society of square pegs in round holes. Griño-Aquino. Otherwise. Feliciano. The decision of the respondent court dated January 13. Medialdea and Regalado. Narvasa Melencio-Herrera..J. It is so ordered.. with costs against the private respondent. . JJ. Padilla." in the words of Justice Holmes. Gutierrez. is REVERSED. we may be "swamped with mediocrity. Bidin. Jr. Sarmiento. WHEREFORE.. 1989. It is time indeed that the State took decisive steps to regulate and enrich our system of education by directing the student to the course for which he is best suited as determined by initial tests and evaluations.the full harnessing of his potentials and the sharpening of his latent talents toward what may even be a brilliant future. C. not because we are lacking in intelligence but because we are a nation of misfits. Cortes.

City of Manila. 26-34. 486. Toribio.Footnotes 1 A check with the Department of Education showed that the private respondent had actually taken and flunked four tests already and was applying to take a fifth examination. 2 Rollo. Intermediate Appellate Court. 15 Phil. Section 5(3). 6 Footnote Nos. 85. 2 He also failed this fifth test. The Lawphil Project . Fabie v. Ynot v. 5 Article XIV. 21 Phil. pp. 1 & 2. 4 US vs.Arellano Law Foundation . 148 SCRA 659. 3 152 SCRA 730.

. QUISUMBING. CANO. Drug. G.. C. No. YAP. JR.EN BANC CARLOS SUPERDRUG CORP.. doing business under the name and style “Advance PUNO.” Present: ELSIE M. 166494 doing business under the name and style “Carlos Superdrug.R.* doing business under the name and YNARES-SANTIAGO. SIMPLICIO L.” Dr. .J.

doing business under the name and CARPIO MORALES. TINGA. style “Leyte Serv-Well Drugstore. the name and style “Botica dela Serna.” AUSTRIA-MARTINEZ.** SANDOVAL- DELA SERNA. doing business under CARPIO. CHICO-NAZARIO.” AZCUNA.style “City Pharmacy..versus - GARCIA.” MELVIN S. and LEYTE SERV-WELL CORP. . GUTIERREZ. CORONA. . Petitioners.

DEPARTMENT June 29. JR. 2007 OF JUSTICE (DOJ). and DEPARTMENT OF INTERIOR and LOCAL GOVERNMENT (DILG). . Respondents.. DEPARTMENT OF FINANCE (DOF). JJ. WELFARE and DEVELOPMENT (DSWD). DEPARTMENT OF Promulgated: HEALTH (DOH). and DEPARTMENT OF SOCIAL NACHURA.VELASCO.

x ---------------------------------------------------------------------------------------.A. 9257. J.x DECISION AZCUNA.*2+ otherwise known as the “Expanded Senior Citizens Act of 2003.” .) No.: This is a petition[1] for Prohibition with Prayer for Preliminary Injunction assailing the constitutionality of Section 4(a) of Republic Act (R.

and prosecute and revoke the licenses of erring drugstore establishments. 2004.[3] was signed into law by President Gloria Macapagal-Arroyo and it became effective on March 21. on the other hand.A.Petitioners are domestic corporations and proprietors operating drugstores in the Philippines. 7432. The antecedents are as follows: On February 26. amending R. include the Department of Social Welfare and Development (DSWD). Section 4(a) of the Act states: . No. No. and the Department of Interior and Local Government (DILG) which have been specifically tasked to monitor the drugstores’ compliance with the law. the Department of Finance (DOF). promulgate the implementing rules and regulations for the effective implementation of the law. Public respondents. the Department of Justice (DOJ). the Department of Health (DOH).A. 2004. 9257. R.

and purchase of medicines in all establishments for the exclusive use or enjoyment of senior citizens. Privileges for the Senior Citizens. .. . including funeral and burial services for the death of senior citizens. – The senior citizens shall be entitled to the following: (a) the grant of twenty percent (20%) discount from all establishments relative to the utilization of services in hotels and similar lodging establishments. 4. restaurants and recreation centers..SEC.

[4] On May 28.[5] Section 9. No. That the cost of the discount shall be allowed as deduction from gross income for the same taxable year that the discount is granted. Provided. Medical and Dental Services in Private Facilities[.A. (f). Section 4 – Discounts for Establishments. (g) and (h) as tax deduction based on the net cost of the goods sold or services rendered: Provided. shall be included in their gross sales receipts for tax purposes and shall be subject to proper documentation and to the provisions of the National Internal Revenue Code. Article 8 of which states: Article 8.The establishment may claim the discounts granted under (a). – The establishment may claim the discounts granted under Rule V. 2004. Rule VI. 9257. the DSWD approved and adopted the Implementing Rules and Regulations of R. further. as amended. Sea and Land . Tax Deduction of Establishments. That the total amount of the claimed tax deduction net of value added tax if applicable.][6] and Sections 10[7] and 11[8] – Air.

finally. shall be included in their gross sales receipts for tax purposes and shall be subject to proper documentation and to the provisions of the National Internal Revenue Code.Transportation as tax deduction based on the net cost of the goods sold or services rendered. That the total amount of the claimed tax deduction net of value added tax if applicable. the DOF. in reference to the query of the Drug Stores Association of the Philippines (DSAP) concerning the meaning of a tax deduction under the Expanded Senior Citizens Act. Recente. clarified as follows: 1) The difference between the Tax Credit (under the Old Senior Citizens Act) and Tax Deduction (under the Expanded Senior Citizens Act). 2004. Provided. That the cost of the discount shall be allowed as deduction from gross income for the same taxable year that the discount is granted. through Director IV Ma. that the implementation of the tax deduction shall be subject to the Revenue Regulations to be issued by the Bureau of Internal Revenue (BIR) and approved by the Department of Finance (DOF).[9] On July 10. further. Provided. Provided. Lourdes B. as amended. .

the costs of which may be claimed by the private establishments concerned as tax credit. restaurants and recreation centers and purchase of medicines anywhere in the country.1. the government shoulders 100% of the discounts granted. a tax credit is a peso-for-peso deduction from a taxpayer’s tax liability due to the government of the amount of discounts such establishment has granted to a senior citizen. The provision of Section 4 of R. The tax credit scheme . No.A. 7432 (the old Senior Citizens Act) grants twenty percent (20%) discount from all establishments relative to the utilization of transportation services. a tax credit scheme under the Philippine tax system.1. Effectively. hotels and similar lodging establishment. It must be noted. necessitates that prior payments of taxes have been made and the taxpayer is attempting to recover this tax payment from his/her income tax due. however. The establishment recovers the full amount of discount given to a senior citizen and hence. that conceptually.

(f). in computing for its tax liability. No. No.2. (g) and (h) as tax deduction from gross income. therefore.A. This will be an amount equivalent to 32% of the twenty percent (20%) discounts so granted. Under this scheme. 7432 is. 1. The provision under R. 9257.under R. the establishment concerned is allowed to deduct from gross income. on the other hand. The establishment shoulders the remaining portion of the granted discounts. . inapplicable since no tax payments have previously occurred. Effectively. the amount of discounts granted to senior citizens. based on the net cost of goods sold or services rendered. the government loses in terms of foregone revenues an amount equivalent to the marginal tax rate the said establishment is liable to pay the government.A. provides that the establishment concerned may claim the discounts under Section 4(a).

the number of potential establishments that may claim tax deductions. diagnostic and laboratory services.It may be necessary to note that while the burden on [the] government is slightly diminished in terms of its percentage share on the discounts granted to senior citizens. operators of domestic air and sea transport services. have however. including professional fees of attending doctors in all private hospitals and medical facilities. Aside from the establishments that may claim tax credits under the old law. been broadened. public railways and skyways and bus transport services. more establishments were added under the new law such as: establishments providing medical and dental services. as follows: Tax Deduction Tax Credit . A simple illustration might help amplify the points discussed above.

Gross Sales xxxxxx xxxxxx Less : Cost of goods sold xxxxx xxxxx Net Sales xxxxx x xxxxxx Less: Operating Expenses: Tax Deduction on Discounts x x x x -- Other deductions: xxxx xxxx Net Taxable Income xxxxx xxxxx Tax Due xxx xxx Less: Tax Credit -- ______x x Net Tax Due -- xx .

O. No. 171. under a tax deduction scheme. providing the grant of twenty percent (20%) discount in the purchase of unbranded generic medicines from all establishments dispensing medicines for the exclusive use of the senior citizens. Under A. On November 12. 171 or the Policies and Guidelines to Implement the Relevant Provisions of Republic Act 9257. on October 1. On the other hand. under a tax credit scheme. the twenty . Administrative Order (A. No.As shown above.O.O. 2004. the DOH issued Administrative Order No 177[12] amending A. otherwise known as the “Expanded Senior Citizens Act of 2003”*11+ was issued by the DOH.[10] Meanwhile.) No. the amount of discounts which is the tax credit item. 177. was deducted directly from the tax due amount. the tax deduction on discounts was subtracted from Net Sales together with other deductions which are considered as operating expenses before the Tax Due was computed based on the Net Taxable Income. 2004.

Thus.” Petitioners assail the constitutionality of Section 4(a) of the Expanded Senior Citizens Act based on the following grounds:[13] 1) The law is confiscatory because it infringes Art. III. 2) It violates the equal protection clause (Art.percent discount shall not be limited to the purchase of unbranded generic medicines only. but shall extend to both prescription and nonprescription medicines whether branded or generic. Sec. 1) enshrined in our Constitution which states that “no person shall be . Sec. III. it stated that “*t+he grant of twenty percent (20%) discount shall be provided in the purchase of medicines from all establishments dispensing medicines for the exclusive use of the senior citizens. 9 of the Constitution which provides that private property shall not be taken for public use without just compensation.

health and other social services available to all people at affordable cost. and 2) the law failed to provide a scheme whereby drugstores will be justly compensated for the discount.” and 3) The 20% discount on medicines violates the constitutional guarantee in Article XIII. Compelling drugstore owners and establishments to grant the discount will result in a loss of profit and capital because 1) drugstores impose a mark-up of only 5% to 10% on branded medicines. . liberty or property without due process of law.”*14+ Petitioners assert that Section 4(a) of the law is unconstitutional because it constitutes deprivation of private property. nor shall any person be denied of the equal protection of the laws. Section 11 that makes “essential goods.deprived of life.

Examining petitioners’ arguments.[16] Being a tax deduction. it is an amount that is allowed by law[15] to reduce the income prior to the application of the tax rate to compute the amount of tax which is due. Theoretically. it is apparent that what petitioners are ultimately questioning is the validity of the tax deduction scheme as a reimbursement mechanism for the twenty percent (20%) discount that they extend to senior citizens. This is because the discount is treated as a deduction. the discount does not reduce taxes owed on a peso for peso basis but merely offers a fractional reduction in taxes owed. a tax-deductible expense that is subtracted from the gross income and results in a lower taxable income. Stated otherwise. the tax deduction scheme does not fully reimburse petitioners for the discount privilege accorded to senior citizens. The . Based on the afore-stated DOF Opinion. the treatment of the discount as a deduction reduces the net income of the private establishments concerned.

9257. The permanent reduction in their total revenues is a forced subsidy corresponding to the taking of private property for public use or benefit.[19] .[17] This constitutes compensable taking for which petitioners would ordinarily become entitled to a just compensation. and to convey the idea that the equivalent to be rendered for the property to be taken shall be real. The word just is used to intensify the meaning of the word compensation.[18] A tax deduction does not offer full reimbursement of the senior citizen discount. No.A. it would not meet the definition of just compensation. full and ample. As such. were it not for R.discounts given would have entered the coffers and formed part of the gross sales of the private establishments. substantial. Just compensation is defined as the full and fair equivalent of the property taken from its owner by the expropriator. The measure is not the taker’s gain but the owner’s loss.

the Act provides: .[20] The priority given to senior citizens finds its basis in the Constitution as set forth in the law itself. in promoting the health and welfare of a special group of citizens. The Senior Citizens Act was enacted primarily to maximize the contribution of senior citizens to nation-building. can impose upon private establishments the burden of partly subsidizing a government program. this raises the question of whether the State. The Court believes so.Having said that. Thus. and to grant benefits and privileges to them for their improvement and well-being as the State considers them an integral part of our society.

women and children. Section 11.” Consonant with these constitutional principles the following are the declared policies of this Act: . disabled. There shall be priority for the needs of the underprivileged sick.SEC. In addition to this. provides: “The State shall adopt an integrated and comprehensive approach to health development which shall endeavor to make essential goods. Article XIII. health and other social services available to all the people at affordable cost. – Pursuant to Article XV. Section 4 of the Constitution. Republic Act No. Section 10 in the Declaration of Principles and State Policies provides: “The State shall provide social justice in all phases of national development.” Further. . elderly.. Declaration of Policies and Objectives. it is the duty of the family to take care of its elderly members while the State may design programs of social security for them. 7432 is hereby amended to read as follows: SECTION 1.. 2.

the law provides that business establishments extending the twenty percent discount to senior citizens may claim the discount as a tax deduction. restaurants and recreation centers. utilization of services in hotels and similar lodging establishments. fares for domestic land. circuses. and other similar places of culture. As a form of reimbursement.[21] To implement the above policy. air and sea travel. and purchases of medicines for the exclusive use or enjoyment of senior citizens. the law grants a twenty percent discount to senior citizens for medical and dental services.(f) To recognize the important role of the private sector in the improvement of the welfare of senior citizens and to actively seek their partnership. concert halls. leisure and amusement. carnivals. . and diagnostic and laboratory fees. admission fees charged by theaters.

must yield to general welfare. either with penalties or without.The law is a legitimate exercise of police power which. thus assuring the greatest benefits. when the conditions so demand as determined by the legislature. statutes. and ordinances. Police power is not capable of an exact definition. it has been described as “the most essential.[25] . as they shall judge to be for the good and welfare of the commonwealth. though sheltered by due process. extending as it does to all the great public needs. property rights must bow to the primacy of police power because property rights. similar to the power of eminent domain. has general welfare for its object. insistent and the least limitable of powers. *22+ Accordingly. and of the subjects of the same.”*24+ For this reason. not repugnant to the constitution.”*23+ It is “*t+he power vested in the legislature by the constitution to make. but has been purposely veiled in general terms to underscore its comprehensiveness to meet all exigencies and provide enough room for an efficient and flexible response to conditions and circumstances. and establish all manner of wholesome and reasonable laws. ordain.

referring to the DOF Opinion.[27] In treating the discount as a tax deduction.00 senior citizen discount that petitioners would give.68 will be shouldered by them as only P0. Moreover. in the absence of evidence demonstrating the alleged confiscatory effect of the provision in question.[26] Given these. it is incorrect for petitioners to insist that the grant of the senior citizen discount is unduly oppressive to their business. for every P1.Police power as an attribute to promote the common good would be diluted considerably if on the mere plea of petitioners that they will suffer loss of earnings and capital. the questioned provision is invalidated. because petitioners have not taken time to calculate correctly and come up with a financial report. P0. . there is no basis for its nullification in view of the presumption of validity which every law has in its favor. so that they have not been able to show properly whether or not the tax deduction scheme really works greatly to their disadvantage.32 will be refunded by the government by way of a tax deduction. petitioners insist that they will incur losses because.

68 which translates to a loss from capital of P5. Here.53 per tablet will be refunded and not the full amount of the discount which is P7. which should not be the case. only 32% of the 20% discount will be reimbursed to the drugstores.92. An income statement. expenses.92.57 per tablet. it acquires Norvasc from the distributors at P37. petitioner Carlos Super Drug cited the antihypertensive maintenance drug Norvasc as an example.89 per tablet.60 (or at a margin of 5%). and net profit (or loss) for a given period could have accurately reflected the effect of the discount on their income. and retails it at P39. If it grants a 20% discount to senior citizens or an amount equivalent to P7. only P2. petitioners tried to show a loss on a per transaction basis.To illustrate this point. then it would have to sell Norvasc at P31.[29] the amount of income derived from all sources before deducting allowable expenses. petitioners cannot . For purposes of reimbursement. Absent any financial statement. the law states that the cost of the discount shall be deducted from gross income. According to the latter. Even if the government will allow a tax deduction. which will result in net income. showing an accounting of petitioners’ sales.[28] Petitioners’ computation is flawed. In short.

substantiate their claim that they will be operating at a loss should they give the discount. The Court is not oblivious of the retail side of the pharmaceutical industry and the competitive pricing component of the business. the computation was erroneously based on the assumption that their customers consisted wholly of senior citizens. in the exercise of police . petitioners must accept the realities of business and the State. Inasmuch as pricing is a property right. Furthermore. the 32% tax rate is to be imposed on income. Lastly. petitioners cannot reproach the law for being oppressive. is merely a result of this decision. simply because they cannot afford to raise their prices for fear of losing their customers to competition. not on the amount of the discount. It is a business decision on the part of petitioners to peg the mark-up at 5%. Selling the medicines below acquisition cost. In addition. as alleged by petitioners. While the Constitution protects property rights. it is unfair for petitioners to criticize the law because they cannot raise the prices of their medicines given the cutthroat nature of the players in the industry.

9257 is arbitrary. continuously serve as a reminder that the right to property can be relinquished upon the command of the State for the promotion of public good. in order to achieve the purpose or objective of the law. the Court will refrain from quashing a legislative act. While Article XIII of the Constitution provides the precept for the protection of property. and that the continued implementation of the same would be unconscionably detrimental to petitioners. the success of the senior citizens program rests largely on the support imparted by petitioners and the other private establishments concerned. various laws and jurisprudence. This being the case. No. Without sufficient proof that Section 4(a) of R. the means employed in invoking the active participation of the private sector.A.[31] .[30] Undeniably. Moreover. particularly on agrarian reform and the regulation of contracts and public utilities. can intervene in the operations of a business which may result in an impairment of property rights in the process.power. the right to property has a social dimension. is reasonably and directly related.

INC. respondent.. the petition is DISMISSED for lack of merit. March 27. 2000] METROPOLITAN MANILA DEVELOPMENT AUTHORITY. 135962.R. No. BEL-AIR VILLAGE ASSOCIATION.WHEREFORE.: . FIRST DIVISION [G. vs. DECISION PUNO. J. petitioner.

(BAVA) is a non-stock. 1995 requesting respondent to open Neptune Street to public vehicular traffic starting January 2. 1996. the government is tempted to take legal shortcuts to solve urgent problems of the people. Inc. On December 30. Respondent Bel-Air Village Association. 1995. non-profit corporation whose members are homeowners in Bel-Air Village. respondent received from petitioner.Not infrequently. a road inside Bel-Air Village. . a private subdivision in Makati City. we let the hammer fall and fall hard on the illegal attempt of the MMDA to open for public use a private road in a private subdivision. While we hold that the general welfare should be promoted. The notice reads: Court "SUBJECT: NOTICE of the Opening of Neptune Street to Traffic "Dear President Lindo. Â h Y Petitioner MMDA is a government agency tasked with the delivery of basic services in Metro Manila. we stress that it should not be achieved at the expense of the rule of law. But even when government is armed with the best of intention. Again. Respondent BAVA is the registered owner of Neptune Street. we cannot allow it to run roughshod over the rule of law. a notice dated December 22. through its Chairman.

"Finally. PROSPERO I. ORETA Chairman"[1] . "Very truly yours. the undersigned requests you to voluntarily open the points of entry and exit on said street. "Thank you for your cooperation and whatever assistance that may be extended by your association to the MMDA personnel who will be directing traffic in the area. 1996. "In view whereof. 7924 which requires the Authority to rationalize the use of roads and/or thoroughfares for the safe and convenient movement of persons."Please be informed that pursuant to the mandate of the MMDA law or Republic Act No. Neptune Street shall be opened to vehicular traffic effective January 2. we are furnishing you with a copy of the handwritten instruction of the President on the matter.

Makati City. Branch 136. The decision disposed of as follows: Jurissc . Sppedsc On January 2. 1996.R. respondent instituted against petitioner before the Regional Trial Court. 96001 for injunction. 1996. 1996. it issued a writ of preliminary injunction enjoining the implementation of the MMDA’s proposed action. 39549. SP No. Respondent prayed for the issuance of a temporary restraining order and preliminary injunction enjoining the opening of Neptune Street and prohibiting the demolition of the perimeter wall. respondent was apprised that the perimeter wall separating the subdivision from the adjacent Kalayaan Avenue would be demolished.On the same day. the trial court denied issuance of a preliminary injunction. 1997.*4+ On January 28.[2] Respondent questioned the denial before the Court of Appeals in CA-G. Civil Case No. the appellate court rendered a Decision on the merits of the case finding that the MMDA has no authority to order the opening of Neptune Street. On January 23. It held that the authority is lodged in the City Council of Makati by ordinance. a private subdivision road and cause the demolition of its perimeter walls. The appellate court conducted an ocular inspection of Neptune Street[3] and on February 13. The trial court issued a temporary restraining order the following day. after due hearing.

del Rosario in contempt is denied. the Motion to Cite Roberto L. Hence. "SO ORDERED. 1995. the challenged Order dated January 23. this recourse. is SET ASIDE and the Writ of Preliminary Injunction issued on February 13. the Petition is GRANTED. in Civil Case No. 96-001.[5] "No pronouncement as to costs. 1996 is hereby made permanent. 1998."[6] The Motion for Reconsideration of the decision was denied on September 28. Jksm Petitioner MMDA raises the following questions: "I . "For want of sustainable substantiation."WHEREFORE.

INC. ESTOPPED FROM DENYING OR ASSAILING THE AUTHORITY OF THE MMDA TO OPEN THE SUBJECT STREET? Jlexj V WAS RESPONDENT DEPRIVED OF DUE PROCESS DESPITE THE SEVERAL MEETINGS HELD BETWEEN MMDA AND THE AFFECTED BEL-AIR RESIDENTS AND BAVA OFFICERS? .HAS THE METROPOLITAN MANILA DEVELOPMENT AUTHORITY (MMDA) THE MANDATE TO OPEN NEPTUNE STREET TO PUBLIC TRAFFIC PURSUANT TO ITS REGULATORY AND POLICE POWERS? II IS THE PASSAGE OF AN ORDINANCE A CONDITION PRECEDENT BEFORE THE MMDA MAY ORDER THE OPENING OF SUBDIVISION ROADS TO PUBLIC TRAFFIC? III IS RESPONDENT BEL-AIR VILLAGE ASSOCIATION.

a private residential subdivision in the heart of the financial and commercial district of Makati City.V HAS RESPONDENT COME TO COURT WITH UNCLEAN HANDS?"[7] Neptune Street is owned by respondent BAVA. Dividing the two (2) streets is a concrete perimeter wall approximately fifteen (15) feet high. formerly Reposo Street. it is now urged that there is no need for the City of Makati to enact an ordinance opening Neptune street to the public. Intermediate Appellate Court. convenience and welfare of the general public. a national road. It runs parallel to Kalayaan Avenue. The western end of Neptune Street intersects Nicanor Garcia. Edpâ mis Petitioner MMDA claims that it has the authority to open Neptune Street to public traffic because it is an agent of the state endowed with police power in the delivery of basic services in Metro Manila. a subdivision road open to public vehicular traffic. It is a private road inside Bel-Air Village.[8] From the premise that it has police power. It is alleged that the police power of MMDA was affirmed by this Court in the consolidated cases of Sangalang v. Both ends of Neptune Street are guarded by iron gates. while its eastern end intersects Makati Avenue. One of these basic services is traffic management which involves the regulation of the use of thoroughfares to insure the safety.[9] . a national road open to the general public.

[11] It bears stressing that police power is lodged primarily in the National Legislature. and establish all manner of wholesome and reasonable laws. either with penalties or without.[18] . public safety.[10] The power is plenary and its scope is vast and pervasive. It has been defined as the power vested by the Constitution in the legislature to make. however.one endowed with powers as a political subdivision of the National Government and as a corporate entity representing the inhabitants of its territory.[12] It cannot be exercised by any group or body of individuals not possessing legislative power.[13] The National Legislature. as they shall judge to be for the good and welfare of the commonwealth.[15] A local government is a "political subdivision of a nation or state which is constituted by law and has substantial control of local affairs. statutes and ordinances. reaching and justifying measures for public health. may delegate this power to the President and administrative boards as well as the lawmaking bodies of municipal corporations or local government units. and the general welfare.Police power is an inherent attribute of sovereignty. ordain. not repugnant to the Constitution. and for the subjects of the same."[16] The Local Government Code of 1991 defines a local government unit as a "body politic and corporate"[17]-.[14] Once delegated. the agents can exercise only such legislative powers as are conferred on them by the national lawmaking body. public morals.

cities. enhance economic prosperity and social justice. those necessarily implied therefrom. viz: Chief "Sec. Within their respective territorial jurisdictions. enhance the right of the people to a balanced ecology.[20] Our Congress delegated police power to the local government units in the Local Government Code of 1991. promote health and safety.[19] They are also the territorial and political subdivisions of the state. local government units shall ensure and support. appropriate. known as the general welfare clause. maintain peace and order. improve public morals. promote full employment among their residents. This delegation is found in Section 16 of the same Code. General Welfare. 16. among other things. municipalities and barangays. the preservation and enrichment of culture.Local government units are the provinces. and those which are essential to the promotion of the general welfare. or incidental for its efficient and effective governance. as well as powers necessary."[21] Local government units exercise police power through their respective legislative bodies. encourage and support the development of appropriate and self-reliant scientific and technological capabilities. The legislative body of the provincial government is .—Every local government unit shall exercise the powers expressly granted. and preserve the comfort and convenience of their inhabitants.

twelve (12) cities and five (5) municipalities.[25] .the sangguniang panlalawigan.) No. A. With the passage of Republic Act (R. Paranaque and Valenzuela. Las Pinas. city or municipality. Quezon. Pateros."[22] The same Code gives the sangguniang barangay the power to "enact ordinances as may be necessary to discharge the responsibilities conferred upon it by law or ordinance and to promote the general welfare of the inhabitants thereon. and its inhabitants pursuant to Section 16 of the Code and in the proper exercise of the corporate powers of the [province. and the municipalities of Malabon. the cities of Caloocan. Pasig. Manila. . Makati. that of the city government is the sangguniang panlungsod. Metropolitan Manila was declared as a "special development and administrative region" and the Administration of "metro-wide" basic services affecting the region placed under "a development authority" referred to as the MMDA. Marikina. approve resolutions and appropriate funds for the general welfare of the [province. San Juan and Taguig. sangguniang panlungsod and sangguniang bayan to "enact ordinances. city municipality] provided under the Code x x x. Navotas. 7924[24] in 1995. that of the municipal government is the sangguniang bayan. . and that of the barangay is the sangguniang barangay. Mandaluyong. as the case may be].. Muntinlupa. namely."[23] Metropolitan or Metro Manila is a body composed of several local government units .e. The Local Government Code of 1991 empowers the sangguniang panlalawigan. Pasay.i.

(5) urban renewal. zoning and land use planning. and shelter services. infrastructure requirements. coordination. The basic service of transport and traffic management includes the following: Lexjuris "(b) Transport and traffic management which include the formulation. (6) health and sanitation. including the institution of a single ticketing system in Metropolitan Manila. the use of thoroughfares."[26] There are seven (7) basic metro-wide services and the scope of these services cover the following: (1) development planning. administration and implementation of all traffic enforcement operations. the MMDA has the following powers and functions: Esm . (3) solid waste disposal and management."[27] In the delivery of the seven (7) basic services. programs and projects to rationalize the existing transport operations. and monitoring of policies. urban protection and pollution control. standards. and (7) public safety. provision for the mass transport system and the institution of a system to regulate road users."Metro-wide services" are those "services which have metro-wide impact and transcend local political boundaries or entail huge expenditures such that it would not be viable for said services to be provided by the individual local government units comprising Metro Manila. (2) transport and traffic management. (4) flood control and sewerage management. traffic engineering services and traffic education programs. and promotion of safe and convenient movement of persons and goods.

coordinate and regulate the implementation of mediumterm investment programs for metro-wide services which shall indicate sources and uses of funds for priority programs and projects. MMDA can create appropriate project management offices. land use and physical development within Metropolitan Manila. subject to the approval of the Council. identify bottlenecks and adopt solutions to problems of implementation. coordinate and regulate the implementation of medium and long-term plans and programs for the delivery of metrowide services. For this purpose. (b) Prepare. and which shall include the packaging of projects and presentation to funding institutions. consistent with national development objectives and priorities."Sec. Esmsc (c) Undertake and manage on its own metro-wide programs and projects for the delivery of specific services under its jurisdiction. programs and projects in Metro Manila. (d) Coordinate and monitor the implementation of such plans.—The MMDA shall: (a) Formulate. . Functions and powers of the Metro Manila Development Authority. 5.

and may deputize members of the PNP. impose and collect fines and penalties for all kinds of violations of traffic rules and regulations. subject to such conditions and requirements as the Authority may impose. when deemed necessary subject to . Upon request. and shall coordinate and regulate the implementation of all programs and projects concerning traffic management. by all other government agencies and offices concerned.(e) The MMDA shall set the policies concerning traffic in Metro Manila. and confiscate and suspend or revoke drivers’ licenses in the enforcement of such traffic laws and regulations. engineering and education. the provisions of RA 4136 and PD 1605 to the contrary notwithstanding. (f) Install and administer a single ticketing system. or members of non-governmental organizations to whom may be delegated certain authority. traffic enforcers of local government units. it shall be extended assistance and cooperation. whether moving or non-moving in nature. including but not limited to. specifically pertaining to enforcement. the Authority shall impose all traffic laws and regulations in Metro Manila. For this purpose. including the undertaking of delivery of basic services to the local government units. duly licensed security guards. fix. and (g) Perform other related functions required to achieve the objectives of the MMDA. through its traffic operation center. assignment of personnel.

the Metro Manila Council approves metro-wide plans. programs and projects is undertaken by the local government units. These functions are particularly enumerated as follows: LEX ." Jurismis The implementation of the MMDA’s plans. programs and projects. collection of service and regulatory fees. The Council is composed of the mayors of the component 12 cities and 5 municipalities. national government agencies. the president of the Metro Manila Vice-Mayors’ League and the president of the Metro Manila Councilors’ League. As the policymaking body of the MMDA.prior coordination with and consent of the local government unit concerned. non-governmental organizations. and the private sector as well as by the MMDA itself.*29+ The Council is headed by a Chairman who is appointed by the President and vested with the rank of cabinet member.[28] The governing board of the MMDA is the Metro Manila Council. memoranda of agreement and other cooperative arrangements with these bodies for the delivery of the required services within Metro Manila. and issues the necessary rules and regulations for the implementation of said plans. fines and penalties. For this purpose. the MMDA has the power to enter into contracts. accredited people’s organizations. it approves the annual budget of the MMDA and promulgates the rules and regulations for the delivery of basic services.

6. and impose and collect fines and penalties. infrastructure requirements. - (a) The Council shall be the policy-making body of the MMDA. One of these is transport and traffic management which includes the formulation and monitoring of policies. It shall fix the compensation of the officers and personnel of the MMDA. prescribe and collect service and regulatory fees. the scope of the MMDA’s function is limited to the delivery of the seven (7) basic services. Functions of the Metro Manila Council. (c) It may increase the rate of allowances and per diems of the members of the Council to be effective during the term of the succeeding Council. (b) It shall approve metro-wide plans. (d) It shall promulgate rules and regulations and set policies and standards for metro-wide application governing the delivery of basic services. standards and projects to rationalize the existing transport operations."Sec. programs and projects and issue rules and regulations deemed necessary by the MMDA to carry out the purposes of this Act. and approve the annual budget thereof for submission to the Department of Budget and Management (DBM)." Jjä sc Clearly. the use of thoroughfares and .

Ca-lrsc It will be noted that the powers of the MMDA are limited to the following acts: formulation. No. A. There is no syllable in R." In addition. including the institution of a single ticketing system in Metro Manila for traffic violations. No."[30] It is an agency created for the purpose of laying down policies and coordinating with the various national government agencies. monitoring.promotion of the safe movement of persons and goods. It also covers the mass transport system and the institution of a system of road regulation. regulation. The MMDA is." fix. nongovernmental organizations and the private sector for the efficient and expeditious delivery of basic services in the vast metropolitan . coordination. traffic engineering services and traffic education programs. a "development authority. Under this service. approve resolutions and appropriate funds for the general welfare" of the inhabitants of Metro Manila. installation of a system and administration. Unlike the legislative bodies of the local government units. Even the Metro Manila Council has not been delegated any legislative power. A. the administration of all traffic enforcement operations. setting of policies. let alone legislative power. as termed in the charter itself. there is no provision in R. implementation. 7924 that empowers the MMDA or its Council to "enact ordinances. 7924 that grants the MMDA police power. people’s organizations. the MMDA is expressly authorized "to set the policies concerning traffic" and "coordinate and regulate the implementation of all traffic management programs. preparation. impose and collect fines and penalties for all traffic violations. the MMDA may "install and administer a single ticketing system. management.

viz: "Sec. All its functions are administrative in nature and these are actually summed up in the charter itself. monitoring and coordinative functions. Intermediate Appellate Court[32] where we upheld a zoning ordinance issued by the Metro Manila Commission (MMC).area. The first Sangalang decision was on the merits of the petition. 2. as the developer of the subdivision. and in the process exercise regulatory and supervisory authority over the delivery of metro-wide services within Metro Manila.[33] while the second decision denied reconsideration of the first case and in addition discussed the case of Yabut v. The petitioners sought to enforce certain restrictive .[34] Sangalang v."[31] Petitioner cannot seek refuge in the cases of Sangalang v. without diminution of the autonomy of the local government units concerning purely local matters. Court of Appeals. The MMDA shall perform planning. as an exercise of police power. the predecessor of the MMDA. -. formerly the Makati Development Corporation.–x x x. IAC involved five (5) consolidated petitions filed by respondent BAVA and three residents of Bel-Air Village against other residents of the Village and the Ayala Corporation. Creation of the Metropolitan Manila Development Authority.

81-01 of the Metro Manila Commission (MMC).[35] The petitions were dismissed based on Ordinance No. converted their residences into commercial establishments in violation of the "deed restrictions. 81 classified Bel-Air Village as a Class A Residential Zone. 81-01. with its boundary in the south extending to the center line of Jupiter Street. Jupiter Street was not for the exclusive benefit of Bel-Air residents.[36] We ruled that since both Ordinances recognized Jupiter Street as the boundary between Bel-Air Village and the commercial district. Municipal Ordinance No. Petitioners alleged that respondents. Bel-Air Village was indicated therein as bounded by Jupiter Street and the block adjacent thereto was classified as a High Intensity Commercial Zone." and that respondent Ayala Corporation ushered in the full commercialization" of Jupiter Street by tearing down the perimeter wall that separated the commercial from the residential section of the village. We also held that the perimeter wall on said street was constructed not to separate the residential from the commercial blocks but simply for . and the condition that the lots be used only for residential purposes. The Municipal Ordinance was adopted by the MMC under the Comprehensive Zoning Ordinance for the National Capital Region and promulgated as MMC Ordinance No. who were residents along Jupiter Street of the subdivision. These were the prohibition on the setting up of commercial and advertising signs on the lots. 81 of the Municipal Council of Makati and Ordinance No.easements in the deeds of sale over their respective lots in the subdivision.

a road inside the same village. in tearing down said wall.[39] Contrary to petitioner’s claim. Scc-alr We upheld the ordinances. The notice does not cite any ordinance or law. 1995 sent by petitioner to respondent BAVA. hence. we held that the opening of Jupiter Street was warranted by the demands of the common good in terms of "traffic decongestion and public convenience.[37] The power of the MMC and the Makati Municipal Council to enact zoning ordinances for the general welfare prevailed over the "deed restrictions". hence." Jupiter was opened by the Municipal Mayor to alleviate traffic congestion along the public streets adjacent to the Village. In the instant case. Ayala Corporation did not violate the "deed restrictions" in the deeds of sale. the basis for the proposed opening of Neptune Street is contained in the notice of December 22. was a public nuisance because it hindered and impaired the use of property. its summary abatement by the mayor was proper and legal. The destruction of the gate in Orbit Street was also made under the police power of the municipal government. the two Sangalang cases do not apply to the case at bar. specifically MMC Ordinance No. through its president. . In the second Sangalang/Yabut decision. like the perimeter wall along Jupiter.[38] The same reason was given for the opening to public vehicular traffic of Orbit Street. both involved zoning ordinances passed by the municipal council of Makati and the MMC. The gate. 81-01.security reasons. Firstly. as a legitimate exercise of police power.

much less police power. It comprised the Greater Manila Area composed of the contiguous four (4) cities of Manila. By no stretch of the imagination. Although the MMC is the forerunner of the present MMDA. that the public services rendered by the respective local governments could be .either by the Sangguniang Panlungsod of Makati City or by the MMDA. and Valenzuela in the province of Bulacan." Rationalizing the use of roads and thoroughfares is one of the acts that fall within the scope of transport and traffic management. Navotas. Misjuris Secondly. Malabon. Pasig. Pateros. D. San Juan.[40] Metropolitan Manila was created as a response to the finding that the rapid growth of population and the increase of social and economic requirements in these areas demand a call for simultaneous and unified development. Mandaluyong. as the legal basis for the proposed opening of Neptune Street. 824. can this be interpreted as an express or implied grant of ordinancemaking power. Pasay and Caloocan. Muntinlupa and Taguig in the province of Rizal. 824. however. Paranaque.) No. and the thirteen (13) municipalities of Makati. the MMDA is not the same entity as the MMC in Sangalang. shows that the latter possessed greater powers which were not bestowed on the present MMDA. an examination of Presidential Decree (P. Las Pinas. the charter of the MMC. Jjlex Metropolitan Manila was first created in 1975 by Presidential Decree (P.) No. Quezon. Marikina.D. Petitioner MMDA simply relied on its authority under its charter "to rationalize the use of roads and/or thoroughfares for the safe and convenient movement of persons.

4.The Commission shall have the following powers and functions: . vested with powers and attributes of a corporation including the power to make contracts. expropriate. . transfer and dispose of property and such other powers as are necessary to carry out its purposes. to be known as the Metropolitan Manila. sue and be sued."[42] The administration of Metropolitan Manila was placed under the Metro Manila Commission (MMC) vested with the following powers: "Sec.—There is hereby created a public corporation. Powers and Functions of the Commission. purchase. Creation of the Metropolitan Manila. and this coordination. The Corporation shall be administered by a Commission created under this Decree. hold.administered more efficiently and economically if integrated under a system of central planning. acquire. "especially in the maintenance of peace and order and the eradication of social and economic ills that fanned the flames of rebellion and discontent [were] part of reform measures under Martial Law essential to the safety and security of the State."[41] Metropolitan Manila was established as a "public corporation" with the following powers: Calrs-pped "Section 1.

. borrow and expend money and issue bonds. revenue certificates.1. To charge and collect fees for the use of public service facilities. Existing tax measures should. To appropriate money for the operation of the metropolitan government and review appropriations for the city and municipal units within its jurisdiction with authority to disapprove the same if found to be not in accordance with the established policies of the Commission. revise or repeal all ordinances. 5. To review. however. without prejudice to any contractual obligation of the local government units involved existing at the time of approval of this Decree. To act as a central government to establish and administer programs and provide services common to the area. 2. 3. amend. resolutions and acts of cities and municipalities within Metropolitan Manila. 4. To levy and collect taxes and special assessments. continue to be operative until otherwise modified or repealed by the Commission. and other obligations of indebtedness.

To enact or approve ordinances. flood control and drainage.000. 10. executive and policy-making functions. To perform general administrative. health and environmental services. which shall direct garbage collection and disposal in the metropolitan area. housing. which shall direct traffic activities. To establish and operate a transport and traffic center. To establish a garbage disposal operation center. which shall direct the fire services of the city and municipal governments in the metropolitan area. To establish a fire control operation center. Jjjuris 11. resolutions and to fix penalties for any violation thereof which shall not exceed a fine of P10. To coordinate and monitor governmental and private activities pertaining to essential services such as transportation. . social.6. park development. 8.00 or imprisonment of six years or both such fine and imprisonment for a single offense. water supply and sewerage. 7. and others. 9.

amend. revise or repeal all ordinances. To perform such other tasks as may be assigned or directed by the President of the Philippines. the power to charge and collect fees. As a "central government" it had the power to levy and collect taxes and special assessments. resolutions and fix penalties for violation of such ordinances and resolutions." ScÓ jj The MMC was the "central government" of Metro Manila for the purpose of establishing and administering programs providing services common to the area. review appropriations for the city and municipal units within its jurisdiction. the power to appropriate money for its operation. To study the feasibility of increasing barangay participation in the affairs of their respective local governments and to propose to the President of the Philippines definite programs and policies for implementation. and at the same time. resolutions and acts of . economic and physical planning and development of the area. To insure and monitor the undertaking of a comprehensive social. To submit within thirty (30) days after the close of each fiscal year an annual report to the President of the Philippines and to submit a periodic report whenever deemed necessary. 13. It also had the power to review.12. It was bestowed the power to enact or approve ordinances. 14. and 15.

and until December 31. the Sangguniang Bayan shall be composed of as many barangay captains as may be determined and chosen by the Commission. upon promulgation of this Decree. In addition. Provided. D. P. resolutions or such measures as it may adopt.any of the four (4) cities and thirteen (13) municipalities comprising Metro Manila. Until otherwise provided. the governments of the four cities and thirteen municipalities in the Metropolitan Manila shall continue to exist in their present form except as may be inconsistent with this Decree. No. The Sangguniang Bayan may recommend to the Commission ordinances. . 9. The members of the existing city and municipal councils in Metropolitan Manila shall. 1975. and such number of representatives from other sectors of the society as may be appointed by the President upon recommendation of the Commission. x x x. become members of the Sangguniang Bayan which is hereby created for every city and municipality of Metropolitan Manila. 824 further provided: "Sec.

Sce-dp Thus. and Provided further. resolutions and measures recommended by the Sangguniang Bayan were subject to the MMC’s approval. the MMC which fully possessed legislative and police powers. until after its approval by the Commission. however. Whatever legislative powers the component cities and municipalities had were all subject to review and approval by the MMC. The Sangguniang Bayan had the power to recommend to the MMC the adoption of ordinances. that possessed legislative powers. the power to impose taxes and other levies. Metropolitan Manila had a "central government." The creation of the MMC also carried with it the creation of the Sangguniang Bayan. the power to appropriate money and the power to pass ordinances or resolutions with penal sanctions shall be vested exclusively in the Commission. resolutions or measures. barangay captains chosen by the MMC and sectoral representatives appointed by the President. there was a clamor to restore the autonomy of the local government units in Metro ." i.e. that the power to impose taxes and other levies. After President Corazon Aquino assumed power. resolution or measure shall become effective.. All ordinances.that no such ordinance. and the power to pass ordinances or resolutions with penal sanctions were vested exclusively in the MMC. This was composed of the members of the component city and municipal councils. Moreover. the power to appropriate money. It was the MMC itself.

however. subject to a plebiscite as set forth in Section 10 hereof. Section 2. cities. The territorial and political subdivisions of the Republic of the Philippines are the provinces. The component cities and municipalities shall retain their basic autonomy and shall be entitled to their own local executives and legislative assemblies. recognized the necessity of creating metropolitan regions not only in the existing National Capital Region but also in potential equivalents in the Visayas and Mindanao. There shall be autonomous regions in Muslim Mindanao and the Cordilleras as herein provided. The jurisdiction of the metropolitan authority that will thereby be created shall be limited to basic services requiring coordination. Hence.Manila. The territorial and political subdivisions shall enjoy local autonomy. by law. municipalities and barangays. create special metropolitan political subdivisions." . Sections 1 and 2 of Article X of the 1987 Constitution provided: Sjä cj "Section 1." The Constitution.[43] Section 11 of the same Article X thus provided: "Section 11. The Congress may.

by law. the Transitory Provisions of the Constitution gave the President of the Philippines the power to constitute the Metropolitan Authority. the jurisdiction of this subdivision shall be limited to basic services requiring coordination."[45] In 1990. although composed of the mayors of the component cities and municipalities. create "special metropolitan political subdivisions" which shall be subject to approval by a majority of the votes cast in a plebiscite in the political units directly affected. and (2) promulgation of . Until otherwise provided by Congress. 392 and constituted the Metropolitan Manila Authority (MMA). however."*47+ The MMA’s governing body.[46] It ought to be stressed. was merely given the power of: (1) formulation of policies on the delivery of basic services requiring coordination and consolidation. and the cities and municipalities comprising this subdivision shall retain their basic autonomy and their own local executive and legislative assemblies.) No. O.[44] Pending enactment of this law. President Aquino issued Executive Order (E.The Constitution itself expressly provides that Congress may. the President may constitute the Metropolitan Authority to be composed of the heads of all local government units comprising the Metropolitan Manila area. The powers and functions of the MMC were devolved to the MMA. the Metropolitan Manila Council. The MMA’s power was limited to the "delivery of basic urban services requiring coordination in Metropolitan Manila. viz: "Section 8. that not all powers and functions of the MMC were passed to the MMA.

It did not have legislative power. 7924 originated as House Bill No." and to "advise the local governments accordingly. the local government units became primarily responsible for the governance of their respective political subdivisions.[48] Under the 1987 Constitution. Any semblance of legislative power it had was confined to a "review [of] legislation proposed by the local legislative assemblies to ensure consistency among local governments and with the comprehensive development plan of Metro Manila. It was presented to the House of Representatives ."[49] When R. Its power was merely to provide the local government units technical assistance in the preparation of local development plans. The MMA’s jurisdiction was limited to addressing common problems involving basic services that transcended local boundaries. 14170/ 11116 and was introduced by several legislators led by Dante Tinga.resolutions and other issuances. A." The character of the MMDA was clearly defined in the legislative debates enacting its charter. No. Metropolitan Manila became a "special development and administrative region" and the MMDA a "special development authority" whose functions were "without prejudice to the autonomy of the affected local government units. 7924 took effect. approval of a code of basic services and the exercise of its rule-making power. Roilo Golez and Feliciano Belmonte. R. No.A.

But it is considered to be a political subdivision. HON. In the case of the Autonomous Region. Mr. The bill was a product of Committee consultations with the local government units in the National Capital Region (NCR). Authority is different. When the bill was first taken up by the Committee on Local Governments. it has the power to tax. and all governmental powers: police power and everything. Let me explain. Now…. province. there are only six (6) political subdivisions provided for in the Constitution: barangay. Ciriaco Alfelor]: Okay.by the Committee on Local Governments chaired by Congressman Ciriaco R. you know. the following debate took place: "THE CHAIRMAN [Hon. Supremeä Actually. because . This has been debated a long time ago. and we have the Autonomous Region of Mindanao and we have the Cordillera. it has its own political personality. with former Chairmen of the MMC and MMA. THE CHAIRMAN: That’s correct. that is also specifically mandated by the Constitution. municipality. It’s a special… we can create a special metropolitan political subdivision. Chairman. So we have 6.[50] and career officials of said agencies. [Elias] LOPEZ: May I interrupt. All right. city. that it has its own government. What is the meaning of a political subdivision? Meaning to say. Alfelor.

it might be deleterious and disadvantageous to other local government units. it is purely coordinative. ‘no. in the exercise of that power. the exercise. All right. Each local government unit is given its respective… as a political subdivision. I was trying to intimate to the author that it . But it does not possess any political power. powers. we cannot deny that the MMDA has to survive. Under the Constitution is a Metropolitan Authority with coordinative power. We do not have the power to tax. justice Of course. However. Kalookan has its powers. resources. Esmmis If you go over Section 6. All right. All right. we are forming an authority where all of these will be members and then set up a policy in order that the basic services can be effectively coordinated. as provided for and protected and guaranteed by the Constitution. Meaning to say. We have to provide some funds. It is only a council. where the powers and functions of the Metro Manila Development Authority. which is not imbued with any political power. So. As a matter of fact. it coordinates all of the different basic services which have to be delivered to the constituency. it is an organization of political subdivision. All right. We do not elect the Governor. And it provides here that the council is policy-making.it does not have its own government. There is now a problem.

I think this was already approved before."[51] Clearly.must have the power to sue and be sued because it coordinates. Sewerage. It coordinates practically all these basic services so that the flow and the distribution of the basic services will be continuous. Like traffic. set-up. we envision that there should be a coordinating agency and it is called an authority. Thus: Ed-p "THE CHAIRMAN: Yeah. Okay. x x x. It’s right on our face. it’s alright. to make the MMDA stronger. This was explicitly stated in the last Committee deliberations prior to the bill’s presentation to Congress. but we have to go over the suggested revision. There is no grant of authority to enact ordinances and regulations for the general welfare of the inhabitants of the metropolis. we cannot deny these. if you do not want to call it an authority. All right. we cannot deny that. The power delegated to the MMDA is that given to the Metro Manila Council to promulgate administrative rules and regulations in the implementation of the MMDA’s functions. but it was reconsidered in view of the proposals. It’s before our eyes. so if there is no objection to paragraph "f"… And then . We may call it a council or maybe a management agency. We have to look for a solution. peace and order. flood control. the MMDA is not a political unit of government. water system. What would be the right solution? All right. All right.

You’ve got the power to set a policy. your honor. and I think here is Chairman Bunye. The creation of the MMDA would be subject to a plebiscite. your Honor. once it is created it has to be subject to a . I’ve been trying to avoid this kind of predicament. there is a constitutional impediment. Otherwise. THE CHAIRMAN: That’s very nice. "It shall approve metro-wide plans. the policies may be in the form of a resolution or it may be in the form of a ordinance." Do you have the powers? Does the MMDA … because that takes the form of a local government unit." under Section 6. Under the Constitution it states: if it is a political subdivision. we are going to see a situation where you have the power to adopt the policy but you cannot really make it stick as in the case now. [Feliciano] BELMONTE: Yes. then we say let’s call it an ordinance and see if they will not follow it. I like that.next is paragraph "b. what’s the use of empowering it to come out with policies. When we say that it has the policies. HON. I believe so. it’s very clear that those policies must be followed. a political subdivision. The term "ordinance" in this case really gives it more teeth. I think he will agree that that is the case now. Now. You are making this MMDA a political subdivision. Otherwise. That is what I’m trying to avoid. However. programs and projects and issue ordinances or resolutions deemed necessary by the MMDA to carry out the purposes of this Act. the body wants to follow your policy.

it is a political exercise. your Honor. Believe me. you impose a sanction. ordinance has a different legal connotation. HON. LOPEZ: And you can also say that violation of such rule. Jksmä âÓ HON. THE CHAIRMAN: In setting up ordinances. say rules and regulations. Chairman. I’m trying to make this as administrative. BELMONTE: All right. what you are saying there is …. I will ….plebiscite. HON. [Elias] LOPEZ: Mr. That would be … it shall also be enforced. I defer to that opinion. sc THE CHAIRMAN: So instead of ordinances. BELMONTE: All right. Mr. But you know. okay. it can be changed into issuances of rules and regulations. BELMONTE: Okay. That’s why we place the Chairman as a cabinet rank. HON. Chairman. . HON.

several amendments were made. These amendments. did not affect the nature of the MMDA as originally conceived in the House of Representatives.HON. BELMONTE: Or resolutions. regulations and resolutions. It is not even . THE CHAIRMAN: Rules and resolutions. The explanatory note to the bill stated that the proposed MMDA is a "development authority" which is a "national agency. HON.[54] When the bill was forwarded to the Senate. No.[55] It is thus beyond doubt that the MMDA is not a local government unit or a public corporation endowed with legislative power. not a political government unit. No interpellations or debates were made on the floor and no amendments introduced."[52] The draft of H. 14170/ 11116 was presented by the Committee to the House of Representatives. Actually. however. they are actually considering resolutions now. B. BELMONTE: Rules."[53] The explanatory note was adopted as the sponsorship speech of the Committee on Local Governments. The bill was approved on second reading on the same day it was presented.

but appointed by the President with the rank and privileges of a cabinet member. It is the local government units.a "special metropolitan political subdivision" as contemplated in Section 11. the President merely exercises supervisory authority. the MMC under P. Unlike the MMC. A. No. A. This emphasizes the administrative character of the MMDA. its proposed opening by petitioner MMDA is illegal and the respondent Court of Appeals did not err in so ruling. . In fact. 824 is not the same entity as the MMDA under R. Everyday. D. hence.[56] R. Esmso We stress that this decision does not make light of the MMDA’s noble efforts to solve the chaotic traffic condition in Metro Manila. traffic jams and traffic bottlenecks plague the metropolis. No. the MMDA has no power to enact ordinances for the welfare of the community. The creation of a "special metropolitan political subdivision" requires the approval by a majority of the votes cast in a plebiscite in the political units directly affected. part of his function is to perform such other duties as may be assigned to him by the President. No. In the case at bar. that possess legislative power and police power. the Sangguniang Panlungsod of Makati City did not pass any ordinance or resolution ordering the opening of Neptune Street. Newmiso Clearly then. Article X of the Constitution. 7924. The Chairman of the MMDA is not an official elected by the people.[57] whereas in local government units. 7924 was not submitted to the inhabitants of Metro Manila in a plebiscite. We desist from ruling on the other issues as they are unnecessary. acting through their respective legislative councils.

Traffic has become a social malaise affecting our people’s productivity and the efficient delivery of goods and services in the country. 76-78. SP No. the petition is denied. The MMDA was created to put some order in the metropolitan transportation system but unfortunately the powers granted by its charter are limited.. Kapunan. Court of Appeals (CA) Rollo.R. Davide. The promotion of the general welfare is not antithetical to the preservation of the rule of law. concur. Rollo. Pardo. .Even our once sprawling boulevards and avenues are now crammed with cars while city streets are clogged with motorists and pedestrians. 39549 are affirmed.J. and Ynares-Santiago. (Chairman). Sdjad IN VIEW WHEREOF.. 27. Jr. Sppedsc SO ORDERED.. [1] Annex "D" to the CA petition. C. JJ. Its good intentions cannot justify the opening for public use of a private street in a private subdivision without any legal warrant. The Decision and Resolution of the Court of Appeals in CA-G. pp. [2] Annex "J" to Petition. p.

p. 24. 61. 603 [1915]. [9] Petition. 332.[3] Minutes of the Ocular Inspection. [6] CA decision. 46 Phil. Court of Appeals Rollo. Rollo. p. 32 Phil. [7] Petition. Rollo. . 447 [1924]. pp. p. p. [5] Roberto L. People v. [4] CA Rollo. 580. 24. 440. Rafferty. p. CA Rollo. pp. 193194. [8] 168 SCRA 634 (1988). 15. Rollo. 253-254 [1915]. del Rosario is a resident of Neptune Street who allegedly spearheaded a campaign to open Neptune Street to the public-. 412-415. 245. 10.Motion to Cite in Contempt. Pomar. p. Pompeya. [10] United States v. 31 Phil. Churchill v. p. 33.

Book I. Part II.J. 513-514 [1991]. Constitutional Law. Sec. [16] Bernas. The 1987 Constitution of the Philippines.. at 959. supra.]. 272 [1994]. p. Constitutional Law. 95-98 [1996]. Binay v. . [13] Id. citing UP Law Center Revision Project. pp. Local Government Code of 1991 [18] Id. 712 [1970] citing Sady..[11] Bernas. 201 SCRA 508. [15] Magtajas v. see also 16 C.S. 44 [1995]. at 44. "Improvement of Local Government Administration for Development Purpose. 234 SCRA 255. Pryce Properties. 177 [1956 ed. [17] Section 15. [14] Cruz. [12] Cruz." Journal of Local Administration Overseas 135 [July 1962]. supra. A Commentary. Domingo.

A. Pryce Properties Corp. [22] Sections 468 (a). IV. Book III. [26] Section 3. 458 (a). Providing Funds Therefor and for Other Purposes. 1. Local Government Code of 1991. [24] Entitled "An Act Creating the Metropolitan Manila Development Authority. II. [20] Section 1. Local Government Code of 1991. [23] Section 391 (a)." [25] Section 1.. 7924. emphasis supplied. and 447 (a). [21] Section 16. 1987 Constitution. par. . Defining its Powers and Functions. [27] Section 3 (b). at 264-265. Book I. supra. III. Book III. 7924. Local Government Code of 1991. Book III. R. supra.[19] Titles I.A. Local Government Code of 1991. also cited in Magtajas v. Inc. R. Article X.

[28] Section 9. paragraph 5. Housing and Urban Development Coordinating Committee (HUDCC). [31] Section 2. [30] Section 1. supra. R. 7924.A. [33] 168 SCRA 634 [1988]. Non-voting members of the Council are the heads of the Department of Transportation and Communications (DOTC). Department of Budget and Management (DBM). [29] Section 4. [34] 176 SCRA 719 [1989]. [32] Op cit. supra. [35] 168 SCRA 634. Department of Public Works and Highways (DPWH). supra. 654-655. . and the Philippine National Police (PNP) or their duly authorized representatives. Department of Tourism (DOT).

[38] Id.D. The Intent of the 1986 Constitution Writers. 824. 1987 Constitution.[36] Id. . at 730. Article X. P. [44] Section 11. P. [41] Whereas Clauses. [39] Like the perimeter wall along Jupiter Street—Id. P. see Bernas. at 734.D. 706-707 [1995]. emphasis supplied. at 643. [42] Section 1. 824. pp.D. 824. at 723. [43] Speech of then Constitutional Commissioner Blas Ople. [37] Id. [40] Section 2.

[46] Section 3. E. . Congress of the Philippines. 392. 68-70. supra. House of Representatives.[45] Section 8. November 9. [48] Section 2. supra. pp. [51] Deliberations of the Committee on Local Government. 1994. 1987 Constitution. supra. Jr. pp. House of Representatives. [52] Deliberations of the Committee on Local Governments. and Ignacio Bunye. 46-48.O. Article XVIII. [50] Chairmen Ismael Mathay. 1993. [47] Section 1. November 10. [49] Section 6. Congress of the Philippines.

divided. EN BANC . B. Sponsorship and Debates. R. abolished. city. 10. 7924. [54] H. 7924. see Senate Amendments.[53] Explanatory Note to H. or its boundary substantially altered except in accordance with the criteria established in the local government code and subject to approval by a majority of the votes cast in a plebiscite in the political units directly affected. Article X of the 1987 Constitution reads: Sec. December 20. [56] Section 10.A. merged. [55] Compare H. 14170/ 11116 with R. 1994.B. February 21.B. No province. 3." [57] Section 7 (g). p. 14170/ 11116. or barangay may be created. 1995. 11116. A. municipality.

REVIEW CENTER ASSOCIATION OF THE PHILIPPINES,

Petitioner,

- versus -

EXECUTIVE SECRETARY

EDUARDO ERMITA and

COMMISSION ON HIGHER

EDUCATION represented by its

Chairman ROMULO L. NERI,

Respondents.

CPA REVIEW SCHOOL OF THE

PHILIPPINES, INC. (CPAR),

PROFESSIONAL REVIEW AND

TRAINING CENTER, INC. (PRTC), ReSA REVIEW SCHOOL, INC.

(ReSA), CRC-ACE REVIEW

SCHOOL, INC. (CRC-ACE),

Petitioners-Intervenors.

PIMSAT COLLEGES,

Respondent-Intervenor.

G.R. No. 180046

Present:

PUNO, C.J.,

QUISUMBING,

YNARES-SANTIAGO,

CARPIO,

AUSTRIA-MARTINEZ,

CORONA,

CARPIO MORALES,

TINGA,

CHICO-NAZARIO,

VELASCO, JR.,

NACHURA,

LEONARDO-DE CASTRO,

BRION, and

PERALTA, JJ.

Promulgated:

April 2, 2009

x--------------------------------------------------x

DECISION

CARPIO, J.:

The Case

Before the Court is a petition for prohibition and mandamus assailing Executive Order No. 566 (EO 566)[1] and Commission on

Higher Education (CHED) Memorandum Order No. 30, series of 2007 (RIRR).[2]

The Antecedent Facts

On 11 and 12 June 2006, the Professional Regulation Commission (PRC) conducted the Nursing Board Examinations nationwide. In June 2006, licensure applicants wrote the PRC to report that handwritten copies of two sets of examinations were circulated during the examination period among the examinees reviewing at the R.A. Gapuz Review Center and Inress Review Center. George Cordero, Inress Review Center’s President, was then the incumbent President of the Philippine Nurses Association. The examinees were provided with a list of 500 questions and answers in two of the examinations’ five subjects, particularly Tests III (Psychiatric Nursing) and V (Medical-Surgical Nursing). The PRC later admitted the leakage and traced it to two Board of Nursing members.[3] On 19 June 2006, the PRC released the results of the Nursing Board Examinations. On 18 August 2006, the Court of Appeals restrained the PRC from proceeding with the oath-taking of the successful examinees set on 22 August 2006.

Consequently, President Gloria Macapagal-Arroyo (President Arroyo) replaced all the members of the PRC’s Board of Nursing. President Arroyo also ordered the examinees to re-take the Nursing Board Examinations.

On 8 September 2006, President Arroyo issued EO 566 which authorized the CHED to supervise the establishment and operation of all review centers and similar entities in the Philippines.

On 3 November 2006, the CHED, through its then Chairman Carlito S. Puno (Chairman Puno), approved CHED Memorandum Order No. 49, series of 2006 (IRR).[4]

In a letter dated 24 November 2006,[5] the Review Center Association of the Philippines (petitioner), an organization of independent review centers, asked the CHED to “amend, if not withdraw” the IRR arguing, among other things, that giving permits to operate a review center to Higher Education Institutions (HEIs) or consortia of HEIs and professional organizations will effectively abolish independent review centers.

In a letter dated 3 January 2007,[6] Chairman Puno wrote petitioner, through its President Jose Antonio Fudolig (Fudolig), that to suspend the implementation of the IRR would be inconsistent with the mandate of EO 566. Chairman Puno wrote that the IRR was presented to the stakeholders during a consultation process prior to its finalization and publication on 13 November 2006. Chairman Puno also wrote that petitioner’s comments and suggestions would be considered in the event of revisions to the IRR.

In view of petitioner’s continuing request to suspend and reevaluate the IRR, Chairman Puno, in a letter dated 9 February 2007,[7] invited petitioner’s representatives to a dialogue on 14 March 2007. In accordance with what was agreed upon during the dialogue,

petitioner submitted to the CHED its position paper on the IRR. Petitioner also requested the CHED to confirm in writing Chairman Puno’s statements during the dialogue, particularly on lowering of the registration fee from P400,000 to P20,000 and the requirement for reviewers to have five years’ teaching experience instead of five years’ administrative experience. Petitioner likewise requested for a categorical answer to their request for the suspension of the IRR. The CHED did not reply to the letter.

On 7 May 2007, the CHED approved the RIRR. On 22 August 2007, petitioner filed before the CHED a Petition to Clarify/Amend Revised Implementing Rules and Regulations[8] praying for a ruling:

1. Amending the RIRR by excluding independent review centers from the coverage of the CHED;

2. Clarifying the meaning of the requirement for existing review centers to tie-up or be integrated with HEIs, consortium or HEIs and PRC-recognized professional associations with recognized programs, or in the alternative, to convert into schools; and

3. Revising the rules to make it conform with Republic Act No. 7722 (RA 7722)*9+ limiting the CHED’s coverage to public and private institutions of higher education as well as degree-granting programs in post-secondary educational institutions.

On 8 October 2007, the CHED issued Resolution No. 718-2007[10] referring petitioner’s request to exclude independent review centers from CHED’s supervision and regulation to the Office of the President as the matter requires the amendment of EO 566. In a letter dated 17 October 2007,[11] then CHED Chairman Romulo L. Neri (Chairman Neri) wrote petitioner regarding its petition to be excluded from the coverage of the CHED in the RIRR. Chairman Neri stated:

While it may be true that regulation of review centers is not one of the mandates of CHED under Republic Act 7722, however, on September 8, 2006, Her Excellency, President Gloria MacapagalArroyo, issued Executive Order No. 566 directing the Commission on Higher Education to regulate the establishment and operation of review centers and similar entities in the entire country.

With the issuance of the aforesaid Executive Order, the CHED now is the agency that is mandated to regulate the establishment and operation of all review centers as provided for under Section 4 of the Executive Order which provides that “No review center or similar entities shall be established and/or operate review classes without the favorable expressed indorsement of the CHED and without the issuance of the necessary permits or authorizations to conduct review classes. x x x”

To exclude the operation of independent review centers from the coverage of CHED would clearly contradict the intention of the said Executive Order No. 566.

Considering that the requests requires the amendment of Executive Order No. 566, the Commission, during its 305th Commission Meeting, resolved that the said request be directly referred to the Office of the President for appropriate action.

As to the request to clarify what is meant by tie-up/be integrated with an HEI, as required under the Revised Implementing Rules and Regulations, tie-up/be integrated simply means, to be in partner with an HEI.[12] (Boldfacing and underscoring in the original)

On 26 October 2007, petitioner filed a petition for Prohibition and Mandamus before this Court praying for the annulment of the RIRR, the declaration of EO 566 as invalid and unconstitutional, and the prohibition against CHED from implementing the RIRR.

Dr. Freddie T. Bernal, Director III, Officer-In-Charge, Office of the Director IV of CHED, sent a letter[13] to the President of Northcap Review Center, Inc., a member of petitioner, that it had until 27 November 2007 to comply with the RIRR.

On 15 February 2008,[14] PIMSAT Colleges (respondentintervenor) filed a Motion For Leave to Intervene and To Admit Comment-in-Intervention and a Comment-in-Intervention praying for the dismissal of the petition. Respondent-intervenor alleges that the Office of the President and the CHED did not commit any act of grave abuse of discretion in issuing EO 566 and the RIRR. Respondentintervenor alleges that the requirements of the RIRR are reasonable, doable, and are not designed to deprive existing review centers of their review business. The Court granted the Motion for Leave to Intervene and to Admit Comment-in-Intervention in its 11 March 2008 Resolution.[15]

On 23 April 2008, a Motion for Leave of Court for Intervention In Support of the Petition and a Petition In Intervention were filed by CPA Review School of the Philippines, Inc. (CPAR), Professional Review and Training Center, Inc. (PRTC), ReSA Review School, Inc.

(ReSA), CRC-ACE Review School, Inc. (CRC-ACE), all independent CPA review centers operating in Manila (collectively, petitionersintervenors). Petitioners-intervenors pray for the declaration of EO 566 and the RIRR as invalid on the ground that both constitute an unconstitutional exercise of legislative power. The Court granted the intervention in its 29 April 2008 Resolution.[16]

On 21 May 2008, the CHED issued CHED Memorandum Order No. 21, Series of 2008 (CMO 21, s. 2008)[17] extending the deadline for six months from 27 May 2008 for all existing independent review centers to tie-up or be integrated with HEIs in accordance with the RIRR.

In its 25 November 2008 Resolution, this Court resolved to require the parties to observe the status quo prevailing before the issuance of EO 566, the RIRR, and CMO 21, s. 2008.

The Assailed Executive Order and the RIRR

Executive Order No. 566 states in full:

EXECUTIVE ORDER NO. 566

DIRECTING THE COMMISSION ON HIGHER EDUCATION TO REGULATE THE ESTABLISHMENT AND OPERATION OF REVIEW CENTERS AND SIMILAR ENTITIES

WHEREAS, the State is mandated to protect the right of all citizens to quality education at all levels and shall take appropriate steps to make education accessible to all, pursuant to Section 1, Article XIV of the 1987 Constitution;

WHEREAS, the State has the obligation to ensure and promote quality education through the proper supervision and regulation of the licensure examinations given through the various Boards of Examiners under the Professional Regulation Commission;

WHEREAS, the lack of regulatory framework for the establishment and operation of review centers and similar entities, as shown in recent events, have adverse consequences and affect public interest and welfare;

WHEREAS, the overriding necessity to protect the public against substandard review centers and unethical practices committed by

some review centers demand that a regulatory framework for the establishment and operation of review centers and similar entities be immediately instituted;

WHEREAS, Republic Act No. 7722, otherwise known as the Higher Education Act of 1994, created the Commission on Higher Education, which is best equipped to carry out the provisions pertaining to the regulation of the establishment and operation of review centers and similar entities.

NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, the President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order:

SECTION 1. Establishment of a System of Regulation for Review Centers and Similar Entities. The Commission on Higher Education (CHED), in consultation with other concerned government agencies, is

hereby directed to formulate a framework for the regulation of review centers and similar entities, including but not limited to the development and institutionalization of policies, standards, guidelines for the establishment, operation and accreditation of review centers and similar entities; maintenance of a mechanism to monitor the adequacy, transparency and propriety of their operations; and reporting mechanisms to review performance and ethical practice.

SEC. 2. Coordination and Support. The Professional Regulation Commission (PRC), Technical Skills Development Authority (TESDA), Securities and Exchange Commission (SEC), the various Boards of Examiners under the PRC, as well as other concerned non-government organizations life professional societies, and various government agencies, such as the Department of Justice (DOJ), National Bureau of Investigation (NBI), Office of the Solicitor General (OSG), and others that may be tapped later, shall provide the necessary assistance and technical support to the CHED in the successful operationalization of the System of Regulation envisioned by this Executive Order.

SEC. 3. Permanent Office and Staff. To ensure the effective implementation of the System of Regulation, the CHED shall organize

a permanent office under its supervision to be headed by an official with the rank of Director and to be composed of highly competent individuals with expertise in educational assessment, evaluation and testing; policies and standards development, monitoring, legal and enforcement; and statistics as well as curriculum and instructional materials development. The CHED shall submit the staffing pattern and budgetary requirements to the Department of Budget and Management (DBM) for approval.

SEC. 4. Indorsement Requirement. No review center or similar entities shall be established and/or operate review classes without the favorable expressed indorsement of the CHED and without the issuance of the necessary permits or authorizations to conduct review classes. After due consultation with the stakeholders, the concerned review centers and similar entities shall be given a reasonable period, at the discretion of the CHED, to comply with the policies and standards, within a period not exceeding three (3) years, after due publication of this Executive Order. The CHED shall see to it that the System of Regulation including the implementing mechanisms, policies, guidelines and other necessary procedures and documentation for the effective implementation of the System, are completed within sixty days (60) upon effectivity of this Executive Order.

SEC. 5. Funding. The initial amount necessary for the development and implementation of the System of Regulation shall be sourced from the CHED Higher Education Development Fund (HEDF), subject to the usual government accounting and auditing practices, or from any applicable funding source identified by the DBM. For the succeeding fiscal year, such amounts as may be necessary for the budgetary requirement of implementing the System of Regulation and the provisions of this Executive Order shall be provided for in the annual General Appropriations Act in the budget of the CHED. Whenever necessary, the CHED may tap its Development Funds as supplemental source of funding for the effective implementation of the regulatory system. In this connection, the CHED is hereby authorized to create special accounts in the HEDF exclusively for the purpose of implementing the provisions of this Executive Order.

SEC. 6. Review and Reporting. The CHED shall provide for the periodic review performance of review centers and similar entities and shall make a report to the Office of the President of the results of

such review, evaluation and monitoring.

SEC. 7. Separability. Any portion or provision of this Executive Order that may be declared unconstitutional shall not have the effect of nullifying other provisions hereof, as long as such remaining provisions can still subsist and be given effect in their entirely.

SEC. 8. Repeal. All rules and regulations, other issuances or parts thereof, which are inconsistent with this Executive Order, are hereby repealed or modified accordingly.

SEC. 9. Effectivity. This Executive Order shall take effect immediately upon its publication in a national newspaper of general circulation.

DONE in the City of Manila, this 8th day of September, in the year of Our Lord, Two Thousand and Six.

(Sgd.) Gloria Macapagal-Arroyo

By the President:

(Sgd.) Eduardo R. Ermita

Executive Secretary

rules and regulations.The pertinent provisions of the RIRR affecting independent review centers are as follows: Rule VII IMPLEMENTING GUIDELINES AND PROCEDURES Section 1. In addition. accredited and reputable HEIs may be authorized to establish and operate review center/course by the CHED upon full compliance with the conditions and requirements provided herein and in other pertinent laws. Authority to Establish and Operate – Only CHED recognized. a consortium or consortia of qualified schools and/or entities may establish and operate review centers or conduct review classes upon compliance with the provisions of these Rules. .

Rule XIV TRANSITORY PROVISIONS .

Section 1. Section 3. Failure of existing review centers to fully comply with the above shall bar them from existing as review centers and they shall be . to tie-up/be integrated with existing HEIs[. Section 2. they may convert as a school and apply for the course covered by the review subject to rules and regulations of the CHED and the SEC with respect to the establishment of schools. In the meantime. Review centers that are existing upon the approval of Executive Order No.] consortium of HEIs and PRC recognized Professional Associations with recognized programs under the conditions set forth in this Order and upon mutually acceptable covenants by the contracting parties. 566 shall be given a grace period of up to one (1) year. In the alternative. Only after full compliance with the requirements shall a Permit be given by the CHED to review centers contemplated under this Rule. no permit shall be issued if there is non-compliance with these conditions or non-compliance with the requirements set forth in these rules.

In addition. and .deemed as operating illegally as such. The Issues The issues raised in this case are the following: 1. Whether EO 566 is an unconstitutional exercise by the Executive of legislative power as it expands the CHED’s jurisdiction. appropriate administrative and legal proceedings shall be commence[d] against the erring entities that continue to operate and appropriate sanctions shall be imposed after due process.

Violation of Judicial Hierarchy . Whether the RIRR is an invalid exercise of the Executive’s rulemaking power. The Ruling of this Court The petition has merit.2.

There is after all a hierarchy of courts. mandamus. That hierarchy is determinative of the venue of appeals. however. quo warranto. This Court’s original jurisdiction to issue a writ of certiorari. to be taken as according to parties seeking any of the writs an absolute. and injunction is not exclusive but is concurrent with the Regional Trial Courts and the Court of Appeals in certain cases. and also serves as a general determinant of the appropriate forum for petitions for the extraordinary writs. A becoming regard of that judicial hierarchy most certainly indicates that petitions for the issuance of .The Office of the Solicitor General (OSG) prays for the dismissal of the petition. Among other grounds. habeas corpus. the OSG alleges that petitioner violated the rule on judicial hierarchy in filing the petition directly with this Court. prohibition. unrestrained freedom of choice of the court to which application therefor will be directed.[18] The Court has explained: This concurrence of jurisdiction is not.

extraordinary writs against first level (“inferior”) courts should be filed with the Regional Trial Court. which in some instances had to be remanded or referred to the lower court as the proper forum under the rules of . A direct invocation of the Supreme Court’s original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor. clearly and specifically set out in the petition. and those against the latter.*19+ The Court has further explained: The propensity of litigants and lawyers to disregard the hierarchy of courts in our judicial system by seeking relief directly from this Court must be put to a halt for two reasons: (1) it would be an imposition upon the precious time of this Court. and to prevent further over-crowding of the Court’s docket. and (2) it would cause an inevitable and resultant delay. with the Court of Appeals. This is [an] established policy. It is a policy necessary to prevent inordinate demands upon the Court’s time and attention which are better devoted to those matters within its exclusive jurisdiction. in the adjudication of cases. intended or otherwise.

Otherwise.procedure. is not absolute. In this case. The Court is not precluded from brushing aside technicalities and taking cognizance of an action due to its importance to the public and in keeping with its duty to determine whether the other branches of the Government have kept themselves within the limits of the Constitution.[21] The alleged violation of the Constitution by the Executive Department when it issued EO 566 justifies the exercise by the Court of its primary jurisdiction over the case. petitioner alleges that EO 566 expands the coverage of RA 7722 and in doing so. however.[20] The rule. or as better equipped to resolve the issues because this Court is not a trier of facts. the proper remedy of petitioner and petitioners-intervenors would have been an ordinary action for the nullification of the RIRR before the Regional Trial Court.[22] . the Executive Department usurps the legislative powers of Congress. The issue in this case is not only the validity of the RIRR. as when exceptional and compelling circumstances justify the exercise of this Court of its primary jurisdiction.

OSG’s Technical Objections The OSG alleges that the petition should be dismissed because the verification and certification of non-forum shopping were signed only by Fudolig without the express authority of any board resolution or power of attorney. the records show that Fudolig was authorized under Board Resolution No. The Court would have required Fudolig to comply with the 2004 Rules on Notarial Practice except that Fudolig already presented his Philippine passport before the notary public when petitioner submitted its reply to the OSG’s comment. series of 2007[23] to file a petition before this Court on behalf of petitioner and to execute any and all documents necessary to implement the resolution. However. . 3. The OSG also alleges that the petition should be dismissed for violation of the 2004 Rules on Notarial Practice because Fudolig only presented his community tax certificate as competent proof of identity before the notary public.

(n) promulgate such rules and regulations and exercise such other powers and functions as may be necessary to carry out effectively the purpose and objectives of this Act[. enumerating the CHED’s powers and functions. but not limited to. diminution or withdrawal of subsidy.EO 566 Expands the Coverage of RA 7722 The OSG alleges that Section 3 of RA 7722 should be read in conjunction with Section 8. the OSG alleges that the CHED has the power under paragraphs (e) and (n) of Section 8 to: (e) monitor and evaluate the performance of programs and institutions of higher learning for appropriate incentives as well as the imposition of sanctions such as. In particular. program termination or school closure. recommendation on the downgrading or withdrawal of accreditation.] .

We do not agree.The OSG justifies its stand by claiming that the term “programs x x x of higher learning” is broad enough to include programs offered by review centers. Section 3 of RA 7722 provides: .

Its coverage shall be both public and private institutions of higher education as well as degree-granting programs in all post-secondary educational institutions.In pursuance of the abovementioned policies. The Commission shall be independent and separate from the Department of Education. (Emphasis supplied) . Culture and Sports (DECS). 3. hereinafter referred to as the Commission. and attached to the Office of the President for administrative purposes only. the Commission on Higher Education is hereby created. Creation of Commission on Higher Education. public and private.Sec. .

. 3. the term “higher education” should be taken in its ordinary sense and should be read and interpreted together with the phrase “degreegranting programs in all post-secondary educational institutions.” Higher education should be taken to mean tertiary education or that which grants a degree after its completion. if the statute is clear. public and private. is defined as “education beyond the secondary level”*25+ or “education provided by a college or university. series of 1994 (Implementing Rules of RA 7722)[24] defines an institution of higher learning or a program of higher learning.[28] Hence. “Higher education. it must be given its literal meaning and applied without interpretation.[27] The legislature is presumed to know the meaning of the words.Neither RA 7722 nor CHED Order No.” however. to have used words advisedly. and to have expressed its intent by use of such words as are found in the statute.”*26+ Under the “plain meaning” or verba legis rule in statutory construction. plain. and free from ambiguity.

.The coverage of the Commission shall be both public and private institutions of higher education as well as degree granting programs in all post-secondary educational institutions. Scope of Application. public and private.Further. conversion. . The establishment. These Rules shall apply to all public and private educational institutions offering tertiary degree programs. or elevation of degree-granting institutions shall be within the responsibility of the Commission. Articles 6 and 7 of the Implementing Rules provide: Article 6.

Republic Act No. HEIs refer to degree-granting institutions. In fact. 8292 or the Higher Education Modernization Act of 1997 covers chartered state universities and colleges. . or those offering tertiary degree or post-secondary programs. Jurisdiction. State universities and colleges primarily offer degree courses and programs.Article 7. Sections 1 and 8. (Emphasis supplied) Clearly.Jurisdiction over institutions of higher learning primarily offering tertiary degree programs shall belong to the Commission. Rule IV of the RIRR define a review center and similar entities as follows: .

xxx . REVIEW CENTER. The term review center as understood in these rules shall also embrace the operation or conduct of review classes or courses provided by individuals whether for a fee or not in preparation for the licensure examinations given by the Professional Regulations Commission. .Section 1.refers to a center operated and owned by a duly authorized entity pursuant to these Rules intending to offer to the public and/or to specialized groups whether for a fee or for free a program or course of study that is intended to refresh and enhance the knowledge and competencies and skills of reviewees obtained in the formal school setting in preparation for the licensure examinations given by the Professional Regulations Commission (PRC).

REVIEW COURSE – refers to the set of non-degree instructional program of study and/or instructional materials/module. The same Rule defines a review course as follows: Section 3. Mathematics and the like. that are intended merely to refresh and enhance the knowledge or competencies and skills of reviewees. SIMILAR ENTITIES – the term refer to other review centers providing review or tutorial services in areas not covered by licensure examinations given by the Professional Regulations Commission including but not limited to college entrance examinations. tutorial services in specific fields like English.Section 8. Civil Service examinations. . offered by a school with a recognized course/program requiring licensure examination.

EO 566 directed the CHED to formulate a framework for the regulation of review centers and similar entities. It also covers the operation or conduct of review classes or courses provided by individuals whether for a fee or not in preparation for the licensure examinations given by the PRC.The scopes of EO 566 and the RIRR clearly expand the CHED’s coverage under RA 7722. The definition of a review center under EO 566 shows that it refers to one which offers “a program or course of study that is intended to refresh and enhance the knowledge or competencies and skills of reviewees obtained in the formal school setting in preparation for the licensure examinations” given by the PRC. . The CHED’s coverage under RA 7722 is limited to public and private institutions of higher education and degree-granting programs in all public and private post-secondary educational institutions.

The reviewee is not required to attend each review class. college entrance examinations. and neither is he given a grade. Even if a reviewee enrolls in a review center. Thus. although not limited to.” A reviewee is not even required to enroll in a review center or to take a review course prior to taking an examination given by the PRC. He is also not required to submit any thesis or dissertation. and tutorial services. which include. the “similar entities” in EO 566 cover centers providing “review or tutorial services” in areas not covered by licensure examinations given by the PRC. . A review course is only intended to “refresh and enhance the knowledge or competencies and skills of reviewees. attendance in a review course is not mandatory. These review and tutorial services hardly qualify as programs of higher learning. programs given by review centers could not be considered “programs x x x of higher learning” that would put them under the jurisdiction of the CHED.A review center is not an institution of higher learning as contemplated by RA 7722. Further. It does not offer a degree-granting program that would put it under the jurisdiction of the CHED. Civil Services examinations. He is not required to take or pass an examination.

(Emphasis supplied) .[29] particularly Section 20.Unless Congress provides otherwise. The OSG further argues that President Arroyo was exercising her residual powers under Executive Order No. thus: Section 20. 292 (EO 292). Title I of Book III. or which are not delegated by the President in accordance with law. Residual Powers.Usurpation of Legislative Power The OSG argues that President Arroyo was merely exercising her executive power to ensure that the laws are faithfully executed. the President shall exercise such other powers and functions vested in the President which are provided for under the laws and which are not specifically enumerated above. .

[32] and this power is vested with the Congress under Section 1. Article VI of the 1987 Constitution which states: .[31] as the provision clearly states that the exercise of the President’s other powers and functions has to be “provided for under the law. Title I of Book III of EO 292 speaks of other powers vested in the President under the law. The President has no inherent or delegated legislative power to amend the functions of the CHED under RA 7722. The President may not amend RA 7722 through an Executive Order without a prior legislation granting her such power.[30] The exercise of the President’s residual powers under this provision requires legislation. Legislative power is the authority to make laws and to alter or repeal them.” There is no law granting the President the power to amend the functions of the CHED.Section 20.

has vested this power in the Congress of the Philippines. In Ople v.Section 1. AO 308 mandates the adoption of a national identification system even in the absence of an enabling legislation. as a usurpation of legislative power. except to the extent reserved to the people by the provision on initiative and referendum. sovereign and unlimited capacity.[33] the Court declared void. to make laws. The legislative power shall be vested in the Congress of the Philippines which shall consist of a Senate and a House of Representatives. under the Constitution. as the will of the people in their original. Legislative power is “the authority. and to alter and repeal them. Torres. as follows: The line that delineates Legislative and Executive power is not indistinct.” The Constitution. Administrative Order No. The grant of . 308 (AO 308) issued by the President to create a national identification system. The Court distinguished between Legislative and Executive powers.

general and comprehensive. except as limited by the Constitution. deemed to be legislative by usage and tradition. In fine. This means that he has the authority to assume directly the functions of the executive department. the President executes the laws. As head of the Executive Department. either expressly or impliedly. unless the Constitution has lodged it elsewhere. It is the power of carrying the laws into practical operation and enforcing their due observance. The executive power is vested in the President. The legislative body possesses plenary power for all purposes of civil government. While Congress is vested with the power to enact laws. It is generally defined as the power to enforce and administer laws. the President is the Chief Executive. bureau and office. He represents the government as a whole and sees to it that all laws are enforced by the officials and employees of his department. is necessarily possessed by Congress. or . legislative power embraces all subjects and extends to matters of general concern or common interest.legislative power to Congress is broad. Any power. bureaus and offices. He has control over the executive department.

Administrative Orders. the President also has the duty of supervising the enforcement of laws for the maintenance of general peace and public order.interfere with the discretion of its officials. he can issue administrative orders. To this end. x x x. Thus. rules and regulations. Administrative power is concerned with the work of applying policies and enforcing orders as determined by proper governmental organs. 3. he is granted administrative power over bureaus and offices under his control to enable him to discharge his duties effectively. It enables the President to fix a uniform standard of administrative efficiency and check the official conduct of his agents.Acts of the President which relate to particular aspects of governmental operation in pursuance of . Corollary to the power of control. . An administrative order is: “Sec.

Torres. bear directly on the public.his duties as administrative head shall be promulgated in administrative orders.[34] Just like AO 308 in Ople v. As well stated by Fisher: “x x x Many regulations however.” An administrative order is an ordinance issued by the President which relates to specific aspects in the administrative operation of government. x x x. It must be in harmony with the law and should be for the sole purpose of implementing the law and carrying out the legislative policy. Regulations are not supposed to be a substitute for the general policy-making that Congress enacts in the form of a public law. It is here that administrative legislation must be restricted in its scope and application. The Court further stated in Ople: x x x. Although administrative . EO 566 in this case is not supported by any enabling law.

”*35+ Since EO 566 is an invalid exercise of legislative power. The RIRR covers review centers and similar entities which are neither institutions of higher education nor institutions offering degree-granting programs. . the RIRR is also an invalid exercise of the CHED’s quasi-legislative power.regulations are entitled to respect.[36] The CHED may only exercise its rule-making power within the confines of its jurisdiction under RA 7722. Administrative agencies exercise their quasi-legislative or rulemaking power through the promulgation of rules and regulations. the authority to prescribe rules and regulations is not an independent source of power to make laws.

education. morals.[37] Police power primarily rests with the legislature although it may be exercised by the President and administrative boards by virtue of a valid delegation.[38] Here. 8981 is Not the Appropriate Law . no delegation of police power exists under RA 7722 authorizing the President to regulate the operations of nondegree granting review centers. good order or safety. and the general welfare of the people flows from the recognition that salus populi est suprema lex – the welfare of the people is the supreme law. Republic Act No.Exercise of Police Power Police power to prescribe regulations to promote the health.

” There is no doubt that a principal mandate of the PRC is to preserve the integrity of licensure examinations. the PRC is mandated to “establish and maintain a high standard of admission to the practice of all professions and at all times ensure and safeguard the integrity of all licensure examinations. These powers of the PRC have nothing to do at all with the regulation of review centers. The PRC has the power to adopt measures to preserve the integrity and inviolability of licensure examinations.It is argued that the President of the Philippines has adequate powers under the law to regulate review centers and this could have been done under an existing validly delegated authority. 8981[39] (RA 8981). The power to preserve the integrity and inviolability of licensure examinations should be read together with these functions.” Section 7 of RA 8981 further states that the PRC shall adopt “measures to preserve the integrity and inviolability of licensure examinations. . The enumeration of PRC’s powers under Section 7(e) includes among others. and that the appropriate law is Republic Act No. the fixing of dates and places of the examinations and the appointment of supervisors and watchers. Under Section 5 of RA 8981. However. this power should properly be interpreted to refer to the conduct of the examinations.

such power does not extend to the regulation of review centers.”*40+ This is an administrative power which the PRC exercises over members of the PRB. The PRC has the power to bar PRB members from conducting review classes in review centers. to interpret this power to extend to the power to regulate review centers is clearly an unwarranted interpretation of RA 8981. There is absolutely nothing in RA 8981 that mentions regulation by the PRC of review centers. this power has nothing to do with the regulation of review centers. However. Section 7(y) of RA 8981 giving the PRC the power to perform “such other functions and duties as may be necessary to carry out the provisions” of RA 8981 does not extend to the regulation of review centers.The PRC has the power to investigate any of the members of the Professional Regulatory Boards (PRB) for “commission of any irregularities in the licensure examinations which taint or impugn the integrity and authenticity of the results of the said examinations. However. The PRC may prohibit the members of the PRB from conducting review classes at review centers because the PRC has administrative supervision over the members of the PRB. However. .

” The questioned CHED RIRR defines “similar entities” as referring to “other review centers providing review or tutorial services in areas not covered by licensure examinations given by the PRC including but not limited to college entrance examinations. . Mathematics and the like. the PRC has no mandate to regulate similar entities whose reviewees will not even take any licensure examination given by the PRC. Civil Service examinations. tutorial services in specific fields like English.The Court cannot likewise interpret the fact that RA 8981 penalizes “any person who manipulates or rigs licensure examination results. The assailed EO 566 seeks to regulate not only review centers but also “similar entities.”*42+ The PRC has no mandate to supervise review centers that give courses or lectures intended to prepare examinees for licensure examinations given by the PRC. It is like the Court regulating bar review centers just because the Court conducts the bar examinations. Similarly. The provision simply provides for the penalties for manipulation and other corrupt practices in the conduct of the professional examinations. secretly informs or makes known licensure examination questions prior to the conduct of the examination or tampers with the grades in the professional licensure examinations”*41+ as a grant of power to regulate review centers.

series of 2007 VOID for being unconstitutional. we GRANT the petition and the petition-inintervention. ANTONIO T. CARPIO Associate Justice .WHEREFORE. We DECLARE Executive Order No. 30. SO ORDERED. 566 and Commission on Higher Education Memorandum Order No.

PUNO Chief Justice .WE CONCUR: REYNATO S.

QUISUMBING Associate Justice .LEONARDO A.

ALICIA AUSTRIA-MARTINEZ Associate Justice .CONSUELO YNARES-SANTIAGO Associate Justice MA.

RENATO C. CORONA Associate Justice .

TINGA Associate Justice .CONCHITA CARPIO MORALES Associate Justice DANTE O.

JR.MINITA V. . CHICO-NAZARIO Associate Justice PRESBITERO J. VELASCO.

BRION . NACHURA Associate Justice ARTURO D.Associate Justice ANTONIO EDUARDO B.

LEONARDO-DE CASTRO Associate Justice .Associate Justice TERESITA J.

PERALTA Associate Justice .DIOSDADO M.

REYNATO S. I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court. Article VIII of the Constitution.CERTIFICATION Pursuant to Section 13. PUNO Chief Justice .

35-37. Directing the Commission on Higher Education to Regulate the Establishment and Operation of Review Centers and Similar Entities. pp.[1] Rollo. Signed on 8 September 2006. .

at 75-77. 2006 is otherwise known as the Implementing Rules and Regulations Governing the Establishment and Operation of Review Centers and Similar Entities in the Philippines. [4] Rollo. [6] Id. CMO 49. [8] Id. at 79. pp. [3] Virginia Madeja and Anesia Dionisio were eventually charged with violation of Republic Act No. [5] Id. at 80. Approved on 7 May 2007. 105-121. s. 3019 (The Anti-Graft and Corrupt Practices Act). 566. 8981 (An Act Modernizing the Professional Regulation Commission) and Republic Act No. at 38-55.[2] Id. [7] Id. . Revised Implementing Rules and Regulations Governing The Establishment and Operation of Review Centers And Similar Entities In The Philippines Pursuant To Executive Order No. at 58-69.

[12] Id. at 181-182.[9] An Act Creating the Commission on Higher Education. [11] Id. p. at 181-182. . Appropriating Funds Therefor and For Other Purposes. 180. p. [14] Resolution. Not 14 February 2008 as stated in the 11 March 2008 [15] Rollo. [10] Rollo. 184. at 257. at 92. [13] Id. [17] Id. at 230. [16] Id.

[23] Rollo. G. [22] Executive Secretary v. 3 August 2006. Nos. 18 April 1989. [20] LPBS Commercial. 20 February 2006. p. 163980. G. 147443. 217 SCRA 633. 529. Amila.R. G. City Mayor of Manila. .R. [21] Holy Spirit Homeowners Association. Vasquez. 11 February 2008. Inc. Inc. Inc. 172 SCRA 415. 482 SCRA 673. [24] Rules and Regulations Implementing RA 7722. 544 SCRA 199. G. 104. 27 January 1993. No. No. 465 Phil.R. 164171. citing Santiago v. as amended.. v. Defensor. v.R. 497 SCRA 581. citing People v.R. G. 99289-90. Amila. Southwing Heavy Industries. v. 67787. No. Cuaresma. Inc.[18] LPBS Commercial. No. supra note 18 at 205. [19] Liga ng mga Barangay National v. 542-543 (2004).

Republic v. [30] See Larin v. 962 (1997). [29] The Administrative Code of 1987. . [33] 354 Phil. [26] Id. [31] See Kilusang Mayo Uno v. No.R. G. 2 March 2007. 1986 ed. p.R. 487 SCRA 623. Lacap. Executive Secretary. G. National Economic Development Authority. [27] SCRA 255. 158253. 1068.. 19 April 2006.*25+ WEBSTER’S THIRD NEW INTERNATIONAL DICTIONARY. [32] Id. 948 (1998). 345 Phil. Director-General. No. 167798. 517 [28] Id.

G. Inc. [38] Id. at 966-968. 530 SCRA 341. [35] Id. 6 February 2007. 15 August 2007.R. at 970.[34] Id. 170656.R. National Wages and Productivity Commission. No. No. 144322. Viron Transportation Co. [39] Otherwise known as the Philippine Regulation Commission Modernization Act of 2000. [41] Section 15. . v. [36] Metropolitan Bank and Trust Company. [40] Section 7(s). Inc. [37] Metropolitan Manila Development Authority v. 514 SCRA 346. G...

POWER OF EMINENT DOMAIN CASES A. November 17. When is the power exercised? Cases lawphil Today is Saturday. 2012 Republic of the Philippines SUPREME COURT Manila EN BANC .[42] Section 8. RIRR.

L-119694 May 22. Jr. Amado P.R.. RESOLUTION FELICIANO. INC. non-profit organization of newspaper and magazine publishers. through a Petition for Certiorari and Prohibition. ("PPI") is before this Court assailing the constitutional validity of Resolution No. petitioner..: The Philippine Press Institute. . Garcia. Inc. COMMISSION ON ELECTIONS. J. for and in behalf of 139 members. 2772 issued by respondent Commission on Elections ("Comelec") and its corresponding Comelec directive dated 22 March 1995. represented by its President. respondent.G. Petitioner PPI is a non-stock. No. vs. Macasaet and its Executive Director Ermin F. 1995 PHILIPPINE PRESS INSTITUTE.

3. free of charge. 2772. 1995 in the case of candidates for senator and from March 21. magazine or periodical is circulated to enable the candidates to make known their qualifications. — "Comelec Space" shall be allocated by the Commission. In the absence of said newspaper. 1995 until May 12. . among all candidates within the area in which the newspaper.On 2 March 1995. "Comelec Space" shall be obtained from any magazine or periodical of said province or city. Uses of Comelec Space. — The Commission shall procure free print space of not less than one half (1/2) page in at least one newspaper of general circulation in every province or city for use as "Comelec Space" from March 6. Comelec Space. which reads in part: xxx xxx xxx Sec. Sec. Comelec promulgated Resolution No. 2. "Comelec Space" shall also be used by the Commission for dissemination of vital election information. 1995. their stand on public issues and their platforms and programs of government.

All candidates concerned shall be furnished a copy of the allocation of "Comelec Space" for their information. — (a) "Comelec Space" shall also be available to all candidates during the periods stated in Section 2 hereof. . guidance and compliance. Any party objecting to the result of the lottery may appeal to the Commission. in writing. to the Committee on Mass Media of the Commission. Allocation of Comelec Space. 4. Its allocation shall be equal and impartial among all candidates for the same office. to the Provincial Election Supervisor concerned. to be present personally or by representative to witness the lottery at the date. (b) Any candidate desiring to avail himself of "Comelec Space" from newspapers or publications based in the Metropolitan Manila Area shall submit an application therefor. in writing. time and place specified in the notice. in writing. Applications for availment of "Comelec Space" maybe filed at any time from the date of effectivity of this Resolution.Sec. Any candidate desiring to avail himself of "Comelec Space" in newspapers or publications based in the provinces shall submit his application therefor. (c) The Committee on Mass Media and the Provincial Election Supervisors shall allocate available "Comelec Space" among the candidates concerned by lottery of which said candidates shall be notified in advance.

opinion. dated 22 March 1995. Undue Reference to Candidates/Political Parties in Newspapers. (Emphasis supplied) Apparently in implementation of this Resolution. sufficiently in advance and in writing of the date of issue and the newspaper or publication allocated to him. the Philippine Star. However. — No newspaper or publication shall allow to be printed or published in the news. as the case maybe. the Malaya and the . 8. to various publishers of newspapers like the Business World. xxx xxx xxx Sec.(d) The candidates concerned shall be notified by the Committee on Mass Media or the Provincial Election Supervisor. and the time within which he must submit the written material for publication in the "Comelec Space". features. Maambong sent identical letters. the Commission will respect the determination by the publisher and/or editors of the newspapers or publications that the accounts or views published are significant. or other sections of the newspaper or publication accounts or comments which manifestly favor or oppose any candidate or political party by unduly or repeatedly referring to or including therein said candidate or political party. Comelec through Commissioner Regalado E. unless the facts and circumstances clearly indicate otherwise. newsworthy and of public interest.

all members of PPI. from March 6. We trust you to extend your full support and cooperation in this regard. biographical data.Philippine Times Journal. Please be reminded that the political parties/candidates may be accommodated in your publication any day upon receipt of their materials until May 6. These letters read as follows: This is to advise you that pursuant to Resolution No. 1995. you are directed to provide free print space of not less than one half (1/2) page for use as "Comelec Space" or similar to the print support which you have extended during the May 11. their stand on public issues and their platforms and programs of government. 1995 to May 6. (Emphasis supplied) . 1995 which is the last day for campaigning. 1992 synchronized elections which was 2 full pages for each political party fielding senatorial candidates. stand on key public issues and platforms of government either as raw data or in the form of positives or camera-ready materials. We shall be informing the political parties and candidates to submit directly to you their pictures. to make known their qualifications. 2772 of the Commission on Elections.

PPI asks us to declare Comelec Resolution No. this Court issued a Temporary Restraining Order enjoining Comelec from enforcing and implementing Section 2 of Resolution No. Article III of the 1987 Constitution. and any of its agencies. as well as the Comelec directives addressed to various print media enterprises all dated 22 March 1995. constitute impositions of involuntary servitude. The Office of the Solicitor General filed its Comment on behalf of respondent Comelec alleging that Comelec Resolution No. against the taking of private property for public use without just compensation. 2772. 2772 is violative of the constitutionally guaranteed freedom of speech. of the press and of expression. 1 On 20 April 1995. PPI argues that Section 8 of Comelec Resolution No. contrary to the provisions of Section 18 (2). 2772 does not impose upon the publishers any obligation to provide free .In this Petition for Certiorari and Prohibition with prayer for the issuance of a Temporary Restraining Order. Petitioner also contends that the 22 March 1995 letter directives of Comelec requiring publishers to give free "Comelec Space" and at the same time process raw data to make it camera-ready. The Court also required the respondent to file a Comment on the Petition. 2772 unconstitutional and void on the ground that it violates the prohibition imposed by the Constitution upon the government. Finally.

the Solicitor General argues that even if the questioned Resolution and its implementing letter directives are viewed as mandatory. Hon. however. Bernardo Pardo. At the same time. The Solicitor General also maintains that Section 8 of Resolution No. respondent Comelec through its Chairman.print space in the newspapers as it does not provide any criminal or administrative sanction for non-compliance with that Resolution. According to the Solicitor General. were not intended to compel those members to supply Comelec with free print space. in response to inquiries from the Chief Justice and other Members of the Court." the procedure for and mode of allocation of such space to candidates and the conditions or requirements for the candidate's utilization of the "Comelec space" procured. impartial and credible election. 2772. the questioned Resolution merely established guidelines to be followed in connection with the procurement of "Comelec space. Chairman Pardo represented to the Court that Resolution and the related letter-directives were merely designed to solicit from the publishers the same free print space which many publishers had voluntarily given to Comelec . 2772 is a permissible exercise of the power of supervision or regulation of the Comelec over the communication and information operations of print media enterprises during the election period to safeguard and ensure a fair. the same would nevertheless be valid as an exercise of the police power of the State. 2 At the oral hearing of this case held on 28 April 1995. particularly Section 2 thereof and the 22 March 1995 letters dispatched to various members of petitioner PPI. stated that Resolution No.

No. the Commission on Elections RESOLVED to clarify Sections 2 and 8 of Res." . civil or criminal. otherwise known as the Omnibus Election Code. that very afternoon. No. meet and adopt an appropriate amending or clarifying resolution. the Court received from the Office of the Solicitor General a manifestation which attached a copy of Comelec Resolution No. Indeed. On 5 May 1995. 2772 shall not be construed to mean as requiring publishers of the different mass media print publications to provide print space under pain of prosecution. the Chairman stated that the Comelec would. 881. there being no sanction or penalty for violation of said Section provided for either in said Resolution or in Section 90 of Batas Pambansa Blg.during the election period relating to the 11 May 1992 elections. the Omnibus Election Code. 2772 as follows: 1. a certified true copy of which would forthwith be filed with the Court. The operative portion of this Resolution follows: NOW THEREFORE. 2772-A dated 4 May 1995. pursuant to the powers vested in it by the Constitution. Section 2 of Res. Republic Acts No. whether administrative. 6646 and 7166 and other election laws. on the grant of "Comelec space.

Section 1 of Resolution No. Section 2 of Resolution No. at this point. the Court could perhaps simply dismiss the Petition for Certiorari and Prohibition as having become moot and academic. (Emphasis in the original) While. Thus. Section 2 of Resolution No. No. as presently worded. opinion. . 2772 persists in its original form. features or other sections of their respective publications or other accounts or comments. . it being clear from the last sentence of said Section 8 that the Commission shall. we consider it not inappropriate to pass upon the first constitutional issue raised in this case." This Resolution shall take effect upon approval. Our hope is to put this issue to rest and prevent its resurrection. respect the determination by the publisher and/or editors of the newspapers or publications that the accounts or views published are significant.2. we must point out that. newsworthy and of public interest. 2772 is not a model of clarity in expression. "unless the facts and circumstances clearly indicate otherwise . 2772-A did not try to redraft Section 2. accordingly. Section 8 of Res. 2772 shall not be construed to mean as constituting prior restraint on the part of publishers with respect to the printing or publication of materials in the news. and in particular as interpreted and applied by the Comelec itself in its 22 March 1995 letter-directives to .

That the agency may not be legally authorized to impose. Section 2 of Resolution No. The enactment or addition of such sanctions by the legislative authority itself would be open to serious constitutional objection. To compel print media companies to donate "Comelec-space" of the dimensions specified in Section 2 of Resolution No.newspaper publishers. in express terms. A written communication officially directing a print media company to supply free print space. only aggravates the constitutional difficulties inhearing in the present situation. amounts to "taking" of private personal property for public use or purposes. 2772 is clearly susceptible of the reading that petitioner PPI has given it. 2772 does not. 2772 (not less than one-half page). criminal or other sanctions for disregard of such directions. Section 2 failed to specify the intended frequency of such compulsory "donation:" only once during the period from 6 March 1995 (or 21 March 1995) until 12 May 1995? or everyday or once a week? or as often as Comelec may direct during the same period? The extent of the taking or deprivation is not insubstantial. or cause the imposition of. this is not a case of a de minimis . threaten publishers who would disregard it or its implementing letters with some criminal or other sanction. That Resolution No. does not by itself demonstrate that the Comelec's original intention was simply to solicit or request voluntary donations of print space from publishers. dispatched by a government (here a constitutional) agency and signed by a member of the Commission presumably legally authorized to do so. is bound to produce a coercive effect upon the company so addressed.

Indeed." measured by the advertising rates ordinarily charged by newspaper publishers whether in cities or in non-urban areas. The taking of print space here sought to be effected may first be appraised under the rubric of expropriation of private personal property for public use. it is not casually to be assumed. it has not been suggested. let alone demonstrated. The monetary value of the compulsory "donation. That the taking is designed to subserve "public use" is not contested by petitioner PPI. another is the legal authority to effect the taking. may be very substantial indeed. The element of necessity for the taking has not been shown by respondent Comelec. We note only that. that Comelec has been granted the power of eminent domain either by the Constitution or by the legislative authority. 2772. the unwillingness or reluctance of Comelec to buy print space lies at the heart of the problem. under Section 3 of Resolution No. the free "Comelec space" sought by the . A reasonable relationship between that power and the enforcement and administration of election laws by Comelec must be shown. It has not been suggested that the members of PPI are unwilling to sell print space at their normal rates to Comelec for election purposes. The threshold requisites for a lawful taking of private property for public use need to be examined here: one is the necessity for the taking. 3 Similarly.temporary limitation or restraint upon the use of private property.

to provide free print space for Comelec . or as an exhortation. or perhaps an appeal. It seems to the Court a matter of judicial notice that government offices and agencies (including the Supreme Court) simply purchase print space. 2772 is read as petitioner PPI reads it.respondent Commission would be used not only for informing the public about the identities. however. whether Section 2 of Resolution No. against their will. There is nothing at all to prevent newspaper and magazine publishers from voluntarily giving free print space to Comelec for the purposes contemplated in Resolution No. 2772 does not. etc. as Section 1 of Resolution No. circulars. when their rules and regulations. as an assertion of authority to require newspaper publishers to "donate" free print space for Comelec purposes. in the kind of factual context here present. notices. 2772. directives. Section 9). circulars. qualifications and programs of government of candidates for elective office but also for "dissemination of vital election information" (including. authorized by the Constitution. provide a constitutional basis for compelling publishers. to publishers to donate free print space. The taking of private property for public use is. And apparently the necessity of paying compensation for "Comelec space" is precisely what is sought to be avoided by respondent Commission. in the ordinary course of events. Section 2 of Resolution No. 2772-A attempts to suggest. of course. regulations. issued by Comelec). but not without payment of "just compensation" (Article III. presumably. notices and so forth need officially to be brought to the attention of the general public.

there was no effort (and apparently no inclination on the part of Comelec) to show that the police power — essentially a power of legislation — has been constitutionally delegated to respondent Commission. however. Section 2 does not constitute a valid exercise of the power of eminent domain. rather than cast solely on one small sector of society. even if read as compelling publishers to "donate" "Comelec space. Firstly. The benefits which flow from a heightened level of information on and the awareness of the electoral process are commonly thought to be communitywide. " may be sustained as a valid exercise of the police power of the state. i. The economic costs of informing the general public about the qualifications and programs of those seeking elective office are most appropriately distributed as widely as possible throughout our society by the utilization of public funds. print media enterprises. As earlier noted. while private property may indeed be validly taken in the legitimate exercise of the police power of the state. made too casually to require prolonged consideration on our part. 4 Secondly. This argument was. there was no attempt to show . We would note that the ruling here laid down by the Court is entirely in line with the theory of democratic representative government.purposes.. 2772. especially funds raised by taxation. the burdens should be allocated on the same basis.e. the Solicitor General also contended that Section 2 of Resolution No.

— No newspaper or publication shall allow to be printed or published in the news. However. without a showing of existence of a national emergency or other imperious public necessity. 5 Section 2 of Resolution No. to take private property of newspaper or magazine publishers. No attempt was made to demonstrate that a real and palpable or urgent necessity for the taking of print space confronted the Comelec and that Section 2 of Resolution No. 2772. We turn to Section 8 of Resolution No. opinion. 2772 was itself the only reasonable and calibrated response to such necessity available to the Comelec. unless the facts and .compliance in the instant case with the requisites of a lawful taking under the police power. features. which needs to be quoted in full again: Sec. 2772 is a blunt and heavy instrument that purports. indiscriminately and without regard to the individual business condition of particular newspapers or magazines located in differing parts of the country. or other sections of the newspaper or publication accounts or comments which manifestly favor or oppose any candidate or political party by unduly or repeatedly referring to or including therein said candidate or political party. Undue Reference to Candidates/Political Parties in Newspapers. Section 2 does not constitute a valid exercise of the police power of the State. 8.

the Court carefully distinguished (a) paid political advertisements which are reached by the prohibition of Section 11 (b). 6646. Section 11 (b) does not purport in any way to restrict the reporting by newspapers or radio or television stations of news or news-worthy events relating to . which prohibits the sale or donation of print space and airtime for campaign or other political purposes. from (b) the reporting of news. In doing so. Section 11 (b) is limited in its scope of application. of print space and air time for campaign or other political purposes. 6 There the Court sustained the constitutionality of Section 11 (b) of R. Analysis of Section 11 (b) shows that it purports to apply only to the purchase and sale. editors. known as the Electoral Reforms Law of 1987.A. Commission on Elections. commentators or columnists which fall outside the scope of Section 11 (b) and which are protected by the constitutional guarantees of freedom of speech and of the press: Secondly. including purchase and sale disguised as a donation. commentaries and expressions of belief or opinion by reporters. newsworthy and of public interest.circumstances clearly indicate otherwise. broadcasters. 2772. In any case. Section 8 should be viewed in the context of our decision in National Press Club v. No. except to the Comelec. and more importantly. the Commission will respect the determination by the publisher and/or editors of the newspapers or publications that the accounts or views published are significant. It is not easy to understand why Section 8 was included at all in Resolution No.

is not paid for by candidates for political office. does not add substantially to the utility of Section 8 of Resolution No. . . Section 11 (b) is not to be read as reaching any report or commentary or other coverage that. their qualifications.candidates. Commission on Elections. We read Section 11 (b) as designed to cover only paid political advertisements of particular candidates. emphasis supplied) Section 8 of Resolution No. The above limitation in scope of application of Section 11 (b) — that it does not restrict either the reporting of or the expression of belief or opinion or comment upon the qualifications and programs and activities of any and all candidates for office — constitutes the critical distinction which must be made between the instant case and that of Sanidad v. 2772-A while possibly helpful. In sum. Section 11 (b) does not reach commentaries and expressions of belief or opinion by reporters or broadcaster or editors or commentators or columnists in respect of candidates. Section 2 of Resolution No. so long at least as such comments. 2772 appears to represent the effort of the Comelec to establish a guideline for implementation of the above-quoted distinction and doctrine in National Press Club an effort not blessed with evident success. in responsible media. . their qualifications. Moreover. and programs and so forth. opinions and beliefs are not in fact advertisements for particular candidates covertly paid for. 2772. 7 (Citations omitted. The distinction between . political parties and programs of government.

broadcasters. time and space. on a case-to-case basis. for public information campaigns and forums among candidates in connection with the objective of holding free. Put a little differently. At all events. editors. commentaries and expressions of belief or opinion by reporters. peaceful and credible elections — . in terms of very specific sets of facts. PPI has not claimed that it or any of its members has sustained actual or imminent injury by reason of Comelec action under Section 8. can realistically be given operative meaning only in actual cases or controversies. the Court is bound to note that PPI has failed to allege any specific affirmative action on the part of Comelec designed to enforce or implement Section 8.paid political advertisements on the one hand and news reports. 2772 constitutes a permissible exercise of the Comelec's power under Article IX. Section 4 of the Constitution to supervise or regulate the enjoyment or utilization of all franchise or permits for the operation of — media of communication or information — [for the purpose of ensuring] equal opportunity. including reasonable. the Court considers that the precise constitutional issue here sought to be raised — whether or not Section 8 of Resolution No. orderly honest. etc. and the right of reply. equal rates therefore. on the other hand.

Section 2 of Resolution No. 2772. No pronouncement as to costs. and the Temporary Restraining Order is hereby MADE PERMANENT. The Petition is DISMISSED in part. Summarizing our conclusions: 1. 2. to the extent it relates to Section 8 of Resolution No. in its present form and as interpreted by Comelec in its 22 March 1995 letter directives. 2772 in its present form and the related letter-directives dated 22 March 1995 are hereby SET ASIDE as null and void. . As such. the Petition for Certiorari and Prohibition is GRANTED in part and Section 2 of Resolution No. the constitutionality of Section 8. Section 2 suffers from a fatal constitutional vice and must be set aside and nullified. purports to require print media enterprises to "donate" free print space to Comelec. To the extent it pertains to Section 8 of Resolution No. WHEREFORE. justiciable case or controversy. 2772.is not ripe for judicial review for lack of an actual case or controversy involving. the Petition for Certiorari and Prohibition must be dismissed for lack of an actual. as the very lis mota thereof. 2772. for all the foregoing.

Jr. 59 (1991 ed. Mendoza and Francisco. 7-12. Puno. Melo.. pp. Rollo.. 70-80. Bellosillo. pp. Footnotes 1 Petition. is on leave..Narvasa. 67 Phil. 1 (1938). Quiason.. Romero. Cruz. J. Vitug. 2 Comment. Constitutional Law. stressed: [w]here private properties needed for conversion to some public use. C. pp.).J. . Kapunan. citing Noble v. Davide. 3 As I. Rollo. JJ. Regalado. concur. a voluntary transaction can then be concluded and the transfer effected without the necessity of judicial action. Padilla. City of Manila.A. p. pp. the first thing obviously that the government should do is to offer to buy it. 5-15. If the owner is willing to sell and the parties can agree on the price and the other conditions of the sale. 6-11.

Inc. 192 SCRA 257 (1990). surpra note 3 at pp. or. 6 207 SCRA 1 (1992). Philippine Veterans Bank. 143 SCRA 480 (1986).But if the owner of the private property is unwilling to part with it.A. By its power of eminent domain. . Cruz. v. Bernardo. 201 SCRA 508 (1991). See also Binay v. cannot agree to the conditions of the transfer. being willing. then it will be necessary for the government to use its coercive authority. upon payment of just compensation. No. Association of Small Landowners in the Philippines. in this connection. Secretary of Agrarian Reform. 44-45. Villacosta v. Inc. 5 See National Development Company v. it can then. Drilon. (Emphases supplied) 4 See. 7160. 175 SCRA 343 (1989). to the President and administrative agencies. 163 SCRA 386 (1988). "Local Government Code of 1991"). R. Domingo. v. The police power may be delegated by the legislative authority to local governments under the general welfare clause (Section 16. forcibly acquire the needed property in order to devote it to the intended public use. Philippine Association of Service Exporters.

.R. except to the Commission on Elections under §90. petitioners.[1] we upheld the validity of §11(b) of R.A. 1998] TELECOMMUNICATIONS AND BROADCAST ATTORNEYS OF THE PHILIPPINES. 132231. respondent. No. decided March 31. INC. THE COMMISSION ON ELECTIONS. with respect to print media.R. INC.Arellano Law Foundation EN BANC [G. April 21. and GMA NETWORK. vs. the Omnibus Election Code. and .P. The Lawphil Project . 6646 which prohibits the sale or donation of print space or air time for political ads.: In Osmeña v. No. J. 1998. 132922. No. G. 881. DECISION MENDOZA. No. COMELEC. of B.7 207 SCRA at 10-11.

Petitioners challenge the validity of §92 on the ground (1) that it takes property without due process of law and without just compensation. it violates the terms of the franchise of petitioner GMA Network. Inc. and (3) that it is in excess of the power given to the COMELEC to supervise or regulate the operation of media of communication or information during the period of election. Inc. taxpayers.P. The Question of Standing . we consider the validity of §92 of B. and that. In the present case. 881 against claims that the requirement that radio and television time be given free takes property without due process of law. Blg. Petitioner Telecommunications and Broadcast Attorneys of the Philippines. that it denies broadcast media the equal protection of the laws.§92. operates radio and television broadcasting stations throughout the Philippines under a franchise granted by Congress. Inc. (2) that it denies radio and television broadcast companies the equal protection of the laws. is an organization of lawyers of radio and television broadcasting companies. that it violates the eminent domain clause of the Constitution which provides for the payment of just compensation. in any event. with respect to broadcast media. No.. GMA Network. The other petitioner. They are suing as citizens. and registered voters.

and the injury is likely to be redressed by a favorable action. 881. To the extent. In contrast. Inc. Nor do members of petitioner TELEBAP have an interest as registered voters since this case does not concern their right of . In those cases[2] in which citizens were authorized to sue. that a party’s standing is determined by the substantive merit of his case or a preliminary estimate thereof. and registered voters. as will presently be shown.P.[3] Members of petitioner have not shown that they have suffered harm as a result of the operation of §92 of B. petitioner TELEBAP must be held to be without standing. As already noted. this Court upheld their standing in view of the “transcendental importance” of the constitutional question raised which justified the granting of relief. its members assert an interest as lawyers of radio and television broadcasting companies and as citizens. (TELEBAP). Indeed. petitioners’ substantive claim is without merit. taxpayers.At the threshold of this suit is the question of standing of petitioner Telecommunications and Broadcast Attorneys of the Philippines. the injury is fairly traceable to the challenged action. therefore. in the case at bar. a citizen will be allowed to raise a constitutional question only when he can show that he has personally suffered some actual or threatened injury as a result of the allegedly illegal conduct of the government. Blg.

or that the third party cannot assert his constitutional right.[4] A party suing as a taxpayer must specifically show that he has a sufficient interest in preventing the illegal expenditure of money raised by taxation and that he will sustain a direct injury as a result of the enforcement of the questioned statute. Inc. appears to have the requisite standing to bring this constitutional challenge. Nor indeed as a corporate entity does TELEBAP have standing to assert the rights of radio and television broadcasting companies. Their interest in §92 of B. Much less do they have an interest as taxpayers since this case does not involve the exercise by Congress of its taxing or spending power. GMA Network.. Petitioner operates radio and television broadcast stations in the Philippines affected . None of these circumstances is here present. 881 should be precisely in upholding its validity. Standing jus tertii will be recognized only if it can be shown that the party suing has some substantial relation to the third party. or that the right of the third party will be diluted unless the party in court is allowed to espouse the third party’s constitutional claim.suffrage. we have decided to take this case since the other petitioner. Nevertheless.P. The mere fact that TELEBAP is composed of lawyers in the broadcast industry does not entitle them to bring this suit in their name as representatives of the affected companies. Blg.

881 are part and parcel . Petitioner’s allegation that it will suffer losses again because it is required to provide free air time is sufficient to give it standing to question the validity of §92. a Reasonable Condition for Grant of Petitioner’s Franchise As pointed out in our decision in Osmeña v. Blg. 6646 and §90 and §92 of B. Petitioner claims that it suffered losses running to several million pesos in providing COMELEC Time in connection with the 1992 presidential election and the 1995 senatorial election and that it stands to suffer even more should it be required to do so again this year.by the enforcement of §92 of B. COMELEC.P. 881 requiring radio and television broadcast companies to provide free air time to the COMELEC for the use of candidates for campaign and other political purposes.A.P. §11(b) of R. Blg. No.[5] Airing of COMELEC Time.

No. announcer or personality who is a candidate for any elective public office shall take a leave of absence from his work as such during the campaign period. or other mass media..P.of a regulatory scheme designed to equalize the opportunity of candidates in an election in regard to the use of mass media for political campaigns. These statutory provisions state in relevant parts: R. 6646 SEC. . B. Blg. 881. 881. Any mass media columnist.. radio broadcasting or television station. (Omnibus Election Code) . or any person making use of the mass media to sell or to give free of charge print space or air time for campaign or other political purposes except to the Commission as provided under Section 90 and 92 of Batas Pambansa Blg. it shall be unlawful: . commentator.. 11. Prohibited Forms of Election Propaganda. (b) for any newspapers.In addition to the forms of election propaganda prohibited under Section 85 of Batas Pambansa Blg.A. 881.

46. §92 states that air time shall be procured by the COMELEC free of charge. Comelec time. the law prohibits mass media from selling or donating print space and air time to the candidates and requires the COMELEC instead to procure print space and air time for allocation to the candidates.The Commission shall procure radio and television time to be known as “Comelec Time” which shall be allocated equally and impartially among the candidates within the area of coverage of all radio and television stations. free of charge. 90. . Said space shall be allocated. as we have held. publication shall be done in any other magazine or periodical in said province or city. 45. 92. . free of charge. equally and impartially by the Commission among all candidates within the area in which the newspaper is circulated. (Sec. during the period of the campaign. For this purpose. however. 881 requires the COMELEC to procure print space which.SEC. the franchise of all radio broadcasting and television stations are hereby amended so as to provide radio or television time.The Commission shall procure space in at least one newspaper of general circulation in every province or city: Provided. SEC. That in the absence of said newspaper. 1978 EC) Thus. Blg.P. which shall be known as “Comelec Space” wherein candidates can announce their candidacy. . 1978 EC). (Sec. should be paid for. Comelec space. It will be noted that while §90 of B.

(prime time) and. among other things. whether by radio or by television stations.[8] Petitioners’ argument is without merit.[9] A franchise is thus a privilege subject. Inc. shall be subject to amendment.850. . 881 violates the due process clause[6] and the eminent domain provision[7] of the Constitution by taking air time from radio and television broadcasting stations without payment of just compensation.498.560.m. is licensed by the government. in this year’s elections.00 in providing free air time of one (1) hour every morning from Mondays to Fridays and one (1) hour on Tuesdays and Thursdays from 7:00 to 8:00 p. the GMA Network. to amendment by Congress in accordance with the constitutional provision that “any such franchise or right granted .” According to petitioners.980. in 1992. lost P22. Airwave frequencies have to be allocated as there are more individuals who want to broadcast than there are frequencies to assign. All broadcasting.Petitioners contend that §92 of BP Blg.”*10+ . it stands to lose P58.00 in view of COMELEC’s requirement that radio and television stations provide at least 30 minutes of prime time daily for the COMELEC Time. Petitioners claim that the primary source of revenue of the radio and television stations is the sale of air time to advertisers and that to require these stations to provide free air time is to authorize a taking which is not “a de minimis temporary limitation or restraint upon the use of private property. alteration or repeal by the Congress when the common good so requires. .

D. 49. This provision was carried over with slight modification by the 1978 Election Code (P. 6388). It goes back to the Election Code of 1971 (R. No. No. which provided: SEC. Regulation of election propaganda through mass media. COMELEC Time. (a) The franchises of all radio broadcasting and television stations are hereby amended so as to require each such station to furnish free of charge.The idea that broadcast stations may be required to provide COMELEC Time free of charge is not new. which provided: SEC. . upon request of the Commission [on Elections]. 1296). Said “Comelec Time” shall be considered as part of the public service time said stations are required to furnish the Government for the dissemination of public information and education under their respective franchises or permits.The Commission [on Elections] shall procure radio and television time to be known as “COMELEC Time” which shall be allocated equally and impartially among the candidates within the area of coverage of said radio and television . 46.A. during the period of sixty days before the election not more than fifteen minutes of prime time once a week which shall be known as “Comelec Time” and which shall be used exclusively by the Commission to disseminate vital election information.

Indeed. For this purpose. §11 of the Constitution authorizes the amendment of franchises for “the common good. such provisions had not been thought of as taking property without just compensation. Substantially the same provision is now embodied in §92 of B. provisions for COMELEC Time have been made by amendment of the franchises of radio and television broadcast stations and. there are responsible scholars who believe that government controls on broadcast media can constitutionally be . until the present case was brought. Art.stations. Even in the United States.”*11+ Nor indeed can there be any constitutional objection to the requirement that broadcast stations give free air time. the franchises of all radio broadcasting and television stations are hereby amended so as to require such stations to furnish the Commission radio or television time. at least once but not oftener than every other day. free of charge. so that they will be fully informed of the issues in an election? “*I+t is the right of the viewers and listeners. during the period of the campaign. XII. particularly the voters. which is paramount. 881.” What better measure can be conceived for the common good than one for free air time for the benefit not only of candidates but even more of the public.P. not the right of the broadcasters. Blg.

the exercise of the privilege may reasonably be burdened with the performance by the grantee of some form of public service.instituted to ensure diversity of views and attention to public affairs to further the system of free expression. We could do a lot to improve coverage of electoral campaigns. broadcast stations may be required to give free air time to candidates in an election.[13] In truth. Since a franchise is a mere privilege. Most important. Stanley. Thus. radio and television broadcasting companies. Professor Cass R. Perhaps a commitment to provide free time would count in favor of the grant of a license in the first instance. Sunstein of the University of Chicago Law School. the United States does not. For this purpose. Perhaps government should pay for such time on its own. They would also help overcome the distorting effects of “soundbites” and the corrosive financial pressures faced by candidates in seeking time on the media. Steps of this sort would simultaneously promote attention to public affairs and greater diversity of view.[12] Thus. which are given franchises. do not own the airwaves and frequencies through which they transmit broadcast signals and images. in De Villata v. writes: Elections. They are merely given the temporary privilege of using them. in urging reforms in regulations affecting the broadcast industry. Perhaps broadcasters should have to offer it as a condition for receiving a license.[14] a regulation . Almost all European nations make such provision. government should ensure free media time for candidates.

technical.[16] the Court ordered the PLDT to allow the interconnection of its domestic telephone system with the international gateway facility of Eastern Telecom.requiring interisland vessels licensed to engage in the interisland trade to carry mail and. NTC. Although the question of compensation for the carriage of mail was not in issue. at more moderate cost. the Court strongly implied that such service could be without compensation. as in fact under Spanish sovereignty the mail was carried free. Similarly. for this purpose. or economic basis for restricting the linking up of two separate telephone systems. as a result of interconnection. and (3) the possibility of increase in the volume of international traffic and more efficient service. was held to be a reasonable condition for the state grant of license. The Court cited (1) the provisions of the legislative franchise allowing such interconnection. to give advance notice to postal authorities of date and hour of sailings of vessels and of changes of sailing hours to enable them to tender mail for transportation at the last practicable hour prior to the vessel’s departure. (2) the absence of any physical. in the earlier case of PLDT v. NTC.[17] it was held: Such regulation of the use and ownership of telecommunications systems is in the exercise of the plenary police power of the State . [15] In Philippine Long Distance Telephone Company v.

and to ensure that all users of the public telecommunications service have access to all other users of the service wherever they may be within the Philippines at an acceptable standard of service and at reasonable cost” (DOTC Circular No. in recognition of the vital role of communications in nation building . . the encompassing objective is the common good. establish. as the regulatory agency of the State. The NTC. Undoubtedly. shall have the right to own. . including corporations. and all economic agents shall contribute to the common good. cooperatives. . subject to the duty of the State to promote distributive justice and to intervene when the common good so demands” (Article XII). . 90-248). . The use of property bears a social function. . and operate economic enterprises. The 1987 Constitution recognizes the existence of that power when it provides: “Sec. and similar collective organizations. to maximize the use of telecommunications facilities available. 6. Individuals and private groups. The interconnection which has been required of PLDT is a form of “intervention” with property rights dictated by “the objective of government to promote the rapid expansion of telecommunications services in all areas of the Philippines.for the promotion of the general welfare. . merely exercised its delegated authority to regulate the use of telecommunications networks when it decreed interconnection. . .

The dissent cites the claim of GMA Network that the grant of free air time to the COMELEC for the duration of the 1998 campaign period would cost the company P52. The claim that petitioner would be losing P52.600. become the property of the company. or the total amount of P58..380. But air time is not owned by broadcast companies.[18] It would be strange if it cannot even require the licensees to render public service by giving free air time. like oil produced from refining or similar natural resources after undergoing a process for their production. v.850.In the granting of the privilege to operate broadcast stations and thereafter supervising radio and television stations. As held in Red Lion Broadcasting Co. Considerable effort is made in the dissent of Mr. the state spends considerable public funds in licensing and supervising such stations. F. representing the cost of producing a program for the COMELEC Time.850.380. representing revenue it would otherwise earn if the air time were sold to advertisers.000 in unrealized revenue from advertising is based on the assumption that air time is “finished product” which. Justice Panganiban to show that the production of television programs involves large expenditure and requires the use of equipment for which huge investments have to be made. “licenses to broadcast do not confer ownership of designated frequencies.980. but only the temporary .C.C. and the amount of P6.000. it is said.[19] which upheld the right of a party personally attacked to reply.

”*20+ As radio and television broadcast stations do not own the airwaves. supplies. but the licensee has no constitutional right to be the one who holds the license or to monopolize a radio frequency to the exclusion of his fellow citizens.” “video tapes. etc.” “miscellaneous (other rental.600.” and “technical facilities (technical crew such .privilege of using them. it is claimed that this is the cost of producing a program and it is for such items as “sets and props. There is nothing in the First Amendment which prevents the Government from requiring a licensee to share his frequency with others and to conduct himself as a proxy or fiduciary with obligations to present those views and voices which are representative of his community and which would otherwise. “a license permits broadcasting.850. Yet the dissent also says that “The franchise holders can recover their huge investments only by selling air time to advertisers.). As to the additional amount of P6. by necessity. transportation. be barred from the airwaves.5) That means neither the State nor the stations own the air lanes. Justice Panganiban’s dissent quotes from Tolentino on the Civil Code which says that “the air lanes themselves ‘are not property because they cannot be appropriated for the benefit of any individual. 13) If air lanes cannot be appropriated.’” (p. no private property is taken by the requirement that they provide air time to the COMELEC.” (p.” Consequently. how can they be used to produce air time which the franchise holders can sell to recover their investment? There is a contradiction here.

Expenses for these items will be for the account of the candidates. However.”*22+ Justice Holmes spoke of the “petty larceny” of the police power. It is unfortunate that in the effort to show that there is taking of private property worth millions of pesos.as director and cameraman as well as ‘on air plugs’).” The charge is really unfortunate.[21] Justice Holmes was so incensed by the resistance of property owners to the erection of party walls that he was led to say in his original draft. no radio/television station shall make any discrimination among candidates relative to charges. which embodies the community’s understanding of the reciprocal rights and duties of neighboring landowners. Rosenbaum Co. does not need to invoke the petty larceny of the police power in its justification. Now we . the unsubstantiated charge is made that by its decision the Court permits the “grand larceny of precious time. “a statute. the preparation of visual aids.” There is no basis for this claim. practices or facilities for in connection with the services rendered. and Holmes had to amend the passage so that in the end it spoke only of invoking “the police power. terms.. In Jackman v. 2983. §6(d) specifically provides in this connection: (d) Additional services such as tape-recording or video-taping of programs. terms and condition thereof.” Holmes’s brethren corrected his taste. COMELEC Resolution No.” and allows itself to become “the people’s unwitting oppressor. and the consideration to be paid therefor may be arranged by the candidates with the radio/television station concerned.

A. or to authorize the temporary use and operation thereof by any agency of the . . No. 7252 which granted GMA Network. the exercise of this right must be compensated. disaster or disturbance of peace and order.A special right is hereby reserved to the President of the Philippines. public peril. Inc. 7252 gives the government the power to temporarily use and operate the stations of petitioner GMA Network or to authorize such use and operation. to temporarily suspend the operation of any station in the interest of public safety. 5.A. No. a franchise for the operation of radio and television broadcasting stations. calamity. in times of rebellion.are being told of the “grand larceny *by means of the police power+ of precious air time. The cited provision of R.” Giving Free Air Time a Duty Assumed by Petitioner Petitioners claim that §92 is an invalid amendment of R. to temporarily take over and operate the stations of the grantee. security and public welfare.A. Right of Government. They argue that although §5 of R. 7252 states: SEC. No. emergency.

its purpose is to enable the government to communicate with the people on matters of public interest. equal opportunity. Blg. No. it is wrong to claim an amendment of petitioner’s franchise for the reason that B. actually antedated it. 7252. Under §92 of B.A.P. R. 7252.P.A. Blg.P. by its franchise to render “adequate public service time” implements §92 of B. No. 881. Undoubtedly. for the use of said stations during the period when they shall be so operated. and the right to reply as mandated by the Constitution. §4 of the latter statute does. upon due compensation to the grantee. And. The basic flaw in petitioner’s argument is that it assumes that the provision for COMELEC Time constitutes the use and operation of the stations of the GMA Network.[23] Indeed. 881.[24] The provision of §92 of B. No. among other things. Blg. Inc.P. time. 881 must be deemed instead to be incorporated in R. This is not so. the COMELEC does not take over the operation of radio and television stations but only the allocation of air time to the candidates for the purpose of ensuring. 7252 provides: . Blg. indeed. Thus. 881.A. Inc.Government. which is said to have amended R. For the fact is that the duty imposed on the GMA Network.

act or scene. or assist in subversive or treasonable acts. No.” There is no reason to suppose that §92 of B. In sum.SEC. No. (Emphasis added) It is noteworthy that §49 of R. 881. Blg. expressly provided that the COMELEC Time should “be considered as part of the public service time said stations are required to furnish the Government for the dissemination of public information and education under their respective franchises or permits.P. conform to the ethics of honest enterprise.A. promote public participation such as in community programming. 881 considers the COMELEC Time therein provided to be otherwise than as a public service which petitioner is required to render under §4 of its charter (R. to reach the population on important public issues. Blg. and not use its station for the broadcasting of obscene and indecent language. from which §92 of B. .The grantee shall provide adequate public service time to enable the Government. or for the dissemination of deliberately false information or willful misrepresentation. 881 was taken. B. Responsibility to the Public. or to incite. or to the detriment of the public interest. 6388. speech. through the said broadcasting stations.P. §92 is not an invalid amendment of petitioner’s franchise but the enforcement of a duty voluntarily assumed by petitioner in accepting a public grant of privilege. assist in the functions of public information and education. 4.P. provide at all times sound and balanced programming. Blg.A. 7252). . encourage.

1998 for candidates for President. 881 that radio and television time given during the period of the campaign shall be “free of charge. 881 for free air time without taking into account COMELEC Resolution No. VicePresident and Senators. Blg.Every radio broadcasting and television station operating under franchise shall grant the Commission. upon payment of just compensation. for candidates for local elective offices. at least thirty (30) minutes of prime time daily. Grant of “Comelec Time. Blg.” Indeed. until May 9. 1998. 2. claims that there should be no more dispute because the payment of compensation . effective February 10.P.” . and effective March 27. 2983-A. The Solicitor General. we have confined the discussion to the provision of §92 of B.” just as §92 requires such time to be given “free of charge.P. Resolution No. relying on the amendment. to be known as “Comelec Time”. 1998. 2983 originally provided that the time allocated shall be “free of charge.” The amendment appears to be a reaction to petitioners’ claim in this case that the original provision was unconstitutional because it allegedly authorized the taking of property without just compensation. being in contravention of §92 of B. §2 of which states: SEC. (Emphasis added) This is because the amendment providing for the payment of “just compensation” is invalid.Thus far.

in the exercise of lawmaking. for example. For one. procure such time for candidates outside that area. What they claim is that because of the breadth of the statutory language. however. the COMELEC is required to procure free air time for candidates “within the area of coverage” of a particular radio or television broadcaster so that it cannot.is now provided for.”*26+ The contention has no basis. Law Allows Flextime for Programming by Stations. it cannot be invoked by the parties. 2983-A arbitrarily sequesters radio and television time. that an administrative agency cannot. 2983-A is invalid.”*25+ Petitioners do not claim that COMELEC Resolution No. At . It is basic. Since §2 of Resolution No. arbitrary and oppressive exercise. the provision in question is susceptible of “unbridled. amend a statute of Congress. Not Confiscation of Air Time by COMELEC It is claimed that there is no standard in the law to guide the COMELEC in procuring free air time and that “theoretically the COMELEC can demand all of the air time of such stations.

No. 6646. as well as the COMELEC Space provided for in §90. 881. Differential Treatment of Broadcast Media Justified Petitioners complain that B. There would indeed be objection to the grant of power to the COMELEC if §92 were so detailed as to leave no room for accommodation of the demands of radio and television programming. in fact. there could be an intrusion into the editorial prerogatives of radio and television stations.what time of the day and how much time the COMELEC may procure will have to be determined by it in relation to the overall objective of informing the public about the candidates. Blg. They contend that newspapers and magazines are not similarly required as. the COMELEC Time provided for in §92.A. in Philippine Press Institute v. is in lieu of paid ads which candidates are prohibited to have under §11(b) of R. this objective must be kept in mind in determining the details of the COMELEC Time as well as those of the COMELEC Space.P. §92 singles out radio and television stations to provide free air time. For were that the case. Accordingly. COMELEC. COMELEC[27] we upheld their right to . their qualifications and their programs of government. As stated in Osmeña v.

To require the radio and television broadcast industry to provide free air time for the COMELEC Time is a fair exchange for what the industry gets. There are important differences in the characteristics of the two media. the government must. the government spends public funds for the allocation and regulation of the broadcast industry. . Because of the physical limitations of the broadcast spectrum.the payment of just compensation for the print space they may provide under §90. as already noted. The reason for this is that. which justify their differential treatment for free speech purposes. relevant conditions may validly be imposed on the grantees or licensees. “*n+ecessarily . . this Court has also held that because of the unique and pervasive influence of the broadcast media. which it does not do in the case of the print media. The argument will not bear analysis. It rests on the fallacy that broadcast media are entitled to the same treatment under the free speech guarantee of the Constitution as the print media. allocate broadcast frequencies to those wishing to use them. There is no similar justification for government allocation and regulation of the print media.[28] In the allocation of limited resources. of necessity. the freedom of television and radio broadcasting . however. From another point of view.

is somewhat lesser in scope than the freedom accorded to newspaper and print media. The impact of the vibrant speech is forceful and immediate.Q. Even here. Unlike readers of the printed work. the radio audience has lesser opportunity to cogitate.s and mental capabilities. newspapers. persons of varying susceptibilities to persuasion. On the other hand. analyze. The television set is also becoming universal. persons whose reactions to inflammatory or offensive speech would be difficult to monitor or predict. persons of different I. Their message may be simultaneously received by a national or regional audience of listeners including the indifferent or unwilling who happen to be within reach of a blaring radio or television set.”*29+ The broadcast media have also established a uniquely pervasive presence in the lives of all Filipinos. Newspapers and current books are found only in metropolitan areas and in the poblaciones of municipalities accessible to fast and regular transportation. and reject the utterance. and magazines beyond their humble means. the transistor radio is found everywhere. Basic needs like food and shelter perforce enjoy high priorities. The materials broadcast over the airwaves reach every person of every age. there are low income masses who find the cost of books.[30] .

IX-C. is the use by media of . 6646. Requirement of COMELEC Time. what the COMELEC is authorized to supervise or regulate by Art.P. In the first place. IX-C. their plea that §92 (free air time) and §11(b) of R.[31] among other things.A. a Reasonable Exercise of the State’s Power to Regulate Use of Franchises Finally. §4 of the Constitution. In addition. §4 of the Constitution does not include the power to prohibit. especially in light of the recent failure of interested parties to have the law repealed or at least modified. That is what Congress tried to reform in 1987 with the enactment of R.Petitioners’ assertion therefore that §92 of B. 881 denies them the equal protection of the law has no basis. 6646 (ban on paid political ads) should be invalidated would pave the way for a return to the old regime where moneyed candidates could monopolize media advertising to the disadvantage of candidates with less resources. it is argued that the power to supervise or regulate given to the COMELEC under Art.A. No. Blg. We are not free to set aside the judgment of Congress. No.

. . Instead of leaving candidates to advertise freely in the mass media. for even as §11(b) prohibits the sale or donation of print space and air time to political candidates. This may have force if the object of the power were the same. the prohibition in §11(b) of R.” when used to describe §11(b) of R.. In other words. it mandates the COMELEC to procure and itself allocate to the candidates space and time in the media. .information of their franchises or permits. In the second place. COMELEC: The term political “ad ban. As we said in Osmeña v. the object of supervision or regulation is different from the object of the prohibition. What is involved here is simply regulation of this nature.. while what Congress (not the COMELEC) prohibits is the sale or donation of print space or air time for political ads. . No. 6646. is misleading. No.. 6646 is only half of the regulatory provision in the statute. The other half is the mandate to the COMELEC to procure print space and air time for allocation to candidates. There is no suppression of political ads but only a regulation of the time and manner of advertising. .A.A. It is another fallacy for petitioners to contend that the power to regulate does not include the power to prohibit.

III. XII. Art. Blg. orderly. 881 is to hold public broadcasters to their obligation to see to it that the variety and vigor of public debate on issues in an election is maintained. establish. by the COMELEC of print space and air time to give all candidates equal time and space for the purpose of ensuring “free. . For while broadcast media are not mere common carriers but entities with free speech rights. This right of the people is paramount to the autonomy of broadcast media.P. the COMELEC Time and COMELEC Space are about the only means through which candidates can advertise their qualifications and programs of government. More than merely depriving candidates of time for their ads.the law provides for allocation. peaceful. they are also public trustees charged with the duty of ensuring that the people have access to the diversity of views on political issues. §6 states that “the use of property bears a social function *and+ the right to own.” To affirm the validity of §92 of B. §7 of the Constitution provides that “the right of the people to information on matters of public concern shall be recognized.” while Art. and operate economic enterprises [is] subject to the duty of the State to promote distributive justice and to intervene when the common good so demands. the failure of broadcast stations to provide air time unless paid by the government would clearly deprive the people of their right to know.” With the prohibition on media advertising by candidates themselves. To affirm the validity of §92. honest. and credible elections.

For the foregoing reasons.. 1998. Bellosillo.J. 132749. Panganiban. JJ. and Purisima. concur. Jr. Regalado. Romero. dissent. Kapunan. Martinez and Quisumbing. COMELEC. G... SO ORDERED. . Broadcast media can find their just and highest reward in the fact that whatever altruistic service they may render in connection with the holding of elections is for that common good. JJ. April 2. Narvasa.).. J.therefore. the petition is dismissed. has separate opinion. C. The use of property bears a social function and is subject to the state’s duty to intervene for the common good. Davide.R. [1] Reiterated in Kapisanan ng mga Broadkaster sa Pilipinas (Negros Occidental Chapter) v. is likewise to uphold the people’s right to information on matters of public concern. Puno. Melo. (res. Vitug. No..

No. Sept.” (Emphasis added) . concurring).[2] Emergency Powers Cases [Araneta v. Art. VI. §§24-25 and 29. Gimenez.R. Executive Secretary.R. 84 Phil. Philippine Charity Sweepstakes Office. Tatad v. we held that the party bringing a suit challenging the constitutionality of a law must show “not only that the law is invalid. Iloilo Palay and Corn Planters Ass’n v. 73972 and 73990. and not merely that he suffers thereby in some indefinite way.. Feliciano.). [4] Const. CLU v. Nos. 1987. 121 Phil. 22. Dinglasan]. G. J. 243 SCRA 436. 194 SCRA 317 (1991). 368 (1949). Philconsa v. 358 (1965). 473 (1995) (Mendoza. It must appear that the person complaining has been or is about to be denied some right or privilege to which he is lawfully entitled or that he is about to be subjected to some burdens or penalties by reason of the statute complained of. 1986. Garcia. [3] Lawyers League for a Better Philippines v. 145 SCRA 160 (1986). Aquino. 894 (1965).. but also that he has sustained or is in immediate danger of sustaining some direct injury as a result of its enforcement. May 22. 78716. 122 Phil. Jr. 73748. G. In re Bermudez. (res.. [5] In Valmonte v.

367. Red Lion Broadcasting Corp. Co. §11. .” [8] Memorandum for Petitioners.S. v. In some instances. Owen M.Ed2d 371 (1969). as amended). liberty. . §9 provides: “Private Property shall not be taken for public use without just compensation. pp.. FCC. 395 U.Ed. [12] E. §3(c) & (d). and the First Amendment is . instrumentalities of the state will try to stifle free and open debate. [9] Eastern Broadcasting Corp. 137 SCRA 628 (1985).g. or property without due process of law. Jr. See The Radio Act (Act No. 21-28.. 23 L. 23 L. (DYRE) v. 3846.. FCC.” *7+ Id. v. XII.2d at 389. nor shall any person be denied the equal protection of the laws.S. III.*6+ Art. but it may also be a source of freedom. The Irony of Free Speech 2-3 (1996) (“Surely the state can be an oppressor. §1 provides: “No person shall be deprived of life. Dans. [11] Red Lion Broadcasting Corp. [10] Art. at 390. . 395 U. Fiss.

. In other instances. but as usually understood. id. [Government regulation] may therefore be necessary. . it is far too simple. [14] 32 Phil. Sunstein. much more fundamentally. [15] The Court said: Considerable expenditures of public money have been made in the past and continue to be made annually for the purpose of securing the safety of vessels plying in Philippine waters.”). Democracy and the Problem of Free Speech 50-51 (1993) (“The idea that threats to speech stem from the government is undoubtedly correct.”) [13] Cass R. [Here the Court enumerated many government facilities to make the coastwise transportation safe. Sunstein. the state may have to further the robustness of public debate. . It may have to allocate public resources. . these threats could not be made without legal entitlements that enable some private actors but not others to speak and to be heard.the tried-and-true mechanism that stops or prevents such abuse of state power. . 541 (1915). Sometimes threats come from what seems to be the private sphere. and. Cass R. . . .] Can it be fairly contended that a regulation is . at 85 (emphasis added). however. to those whose voices would not otherwise be heard in the public square.

possession. 3. as amended). control. [18] For example. at 552. sale and transfer of radio transmitters or transceivers (combination transmitter-receiver) and the establishment. [16] 241 SCRA 486 (1995). In addition to the above he shall have the following specific powers and duties: . and to give such reasonable notice of their sailing hours as will insure the prompt dispatch of all mails ready for delivery at the hours thus designated? Id. the following functions: SEC.unreasonable which requires vessels licensed to engage in the interisland trade.. use. to hold themselves in readiness to carry the public mails when duly tendered for transportation. The Secretary of Public Works and Communications is hereby empowered. under the Radio Act (Act No. the government performs. 3846. inter alia. [17] 190 SCRA 717. the operation of all radio stations and of all form of radio communications and transmissions within the Philippines. to regulate the construction or manufacture. in whose behalf the public funds are so lavishly expended. 734 (1990) (italics by the Court).

Ed. at 389. (c) He shall assign call letters and assign frequencies for each station licensed by him and for each station established by virtue of a franchise granted by the Congress of the Philippines and specify the stations to which each of such frequencies may be used. 22. [19] 395 U. quoting 47 U.2d at 388-389. That changes in the frequencies or in the authorized power. 23 L. at 394.S.S. .. or in the type of the power supply. [21] 260 U..S.. shall not be made without first giving the station licensee a hearing. (d) He shall promulgate rules and regulations to prevent and eliminate interference between stations and carry out the provisions of this Act and the provisions of the International Radio Regulations: Provided. 107 (1922).C. however. 67 L. [20] 395 U.Ed. §301.2d at 391.Ed. or in the hours of operations of any licensed stations.S. 23 L. or in the character of emitted signals.

M. 1 Holmes-Laski Letters 457 (1953). 1992. 3. IX-C. §4.Ed.Ed. 1985. [26] Ibid. Constitutional Law. at 31. but a similar “right of reply” is inapplicable to newspapers. it has been held that broadcast stations may be required to give persons subjected to personal attack during discussion of an important public issue the right to reply (Red Lion Broadcasting Corp. No. [28] In the United States. [27] 244 SCRA 272 (1995). whereas R.S. Blg. 395 U. v. Freund. It was pointed out that a statute providing for such right “operates as a command in the same sense as a statute or . 17.[22] 260 U. because of recognition of these differences in the characteristics of news media. p.S. [23] Art.A.P. 67 L. Brown. [24] B. 881 took effect on Dec. at 112. Howe and E. 367. FCC. 7252 took effect on March 20. quoted in P.2d 371 (1969)). Sutherland. [25] Memorandum for Petitioners. 23 L. Cases and Other Problems 1095 (1978). A.

] editors might well conclude that the safe course is to avoid controversy. including reasonable. or concessions granted by the Government or any subdivision. the governmentenforced+ right of access inescapably ‘dampens the vigor and limits the variety of public debate.2d 730 (1974)) [29] Eastern Broadcasting (DYRE) Corporation v. for public information campaigns .S. [Thus. . . . The first phase of the penalty [is] exacted in terms of the cost in printing and in taking up space that could be devoted to other material the newspaper may have preferred to print. *31+ This provision reads: “The Commission may. [Faced with such a penalty. .’” (Miami Herald Pub. equal rates therefor. Dans. agency. media of communication or information. Tornillo. Jr. supervise or regulate the enjoyment or utilization of all franchises or permits for the operation of transportation and other public utilities. 137 SCRA at 635.Ed. . 418 U. at 635-636. 4 L. . [It] exacts a penalty on the basis of the content of a newspaper. including any government-owned or controlled corporation or its subsidiary. [30] Id. 241. .regulation forbidding [the newspaper] to publish specified matter. special privileges. .. Such supervision or regulation shall aim to ensure equal opportunity. time. during the election period. . or instrumentality thereof. all grants. and the right to reply. v. Co. and space.

CITY OF MANDALUYONG. 1998 issued by Branch 155 of the Regional Trial Court of Pasig in SCA No.: In this petition for review on certiorari under Rule 45. the dispositive portion of which reads as follows: . honest. Who may exercise the power of eminent domain? Cases THIRD DIVISION [G.R. respondent. J. frnaics DECISION GONZAGA_REYES. Alberto S. March 14.” B. Suguitan. 2000] HEIRS OF ALBERTO SUGUITAN.and forums among candidates in connection with the objective of holding free. petitioner. 135087. peaceful. and credible elections. vs. orderly. petitioners[1] pray for the reversal of the Order dated July 28. 875 entitled "City of Mandaluyong v. No.

56264 of the Registry of Deeds for Metro Manila District II for the public use or purpose as stated in the Complaint. the instant Motion to Dismiss is hereby DENIED and an ORDER OF CONDEMNATION is hereby issued declaring that the plaintiff. Abalos to institute expropriation proceedings over the property of Alberto Sugui located at Boni Avenue and Sto. a list of independent appraisers from which the Court t will select three (3) to be appointed as Commissioners. S-1994[3] authorizing then Mayor Benjamin S. in view of the foregoing. .[2]ella It is undisputed by the parties that on October 13. City of Mandaluyong. The intended purpose of the expropriation was the expansion of the Mandaluyong Medical Center. Accordingly. Rules of Court. Rule 67. 1994. in order to ascertain the just compensation. has a lawful right to take the subject parcel of land together with existing improvements thereon more specifically covered by Transfer Certificate Of Title No. 56264 of the Registry of Deeds of Metro Manila District II. the Sangguniang Panlungsod of Mandaluyong City issued Resolution No. pursuant to Section 5.WHEREFORE. Rosario streets in Mandaluyong City with an area of 414 square meters and more particularly described under Transfer Certificate of Title No. SO ORDERED. the parties are hereby directed to submit to the Court within fifteen (15) days from notice hereof. upon payment of just compensation. 396.

The case was docketed as SCA No. but Suguitan refused to sell. On October 24. (4) the City of Mandaluyong has no budget and appropriation for the payment of the property being expropriated. the trial court issued an order allowing the City of Mandaluyong to take immediate possession of Suguitan's property upon the deposit of P621.000 representing 15% of the fair market value of the subject property based upon the current tax declaration of such property.[7] On November 14. 1995. 875. (2) there is no public necessity to warrant expropriation of subject property.Mayor Benjamin Abalos wrote Alberto Suguitan a letter dated January 20. 1995. On December 15. novero Suguitan filed a motion to dismiss[6] the complaint based on the following grounds -(1) the power of eminent domain is not being exercised in accordance with law. and (5) expropriation of Suguitan' s property is but a ploy of Mayor Benjamin Abalos to acquire the same for his personal use.[4] Consequently. 1995 offering to buy his property. acting upon a motion filed by the respondent. 1995. 1995. the trial court denied Suguitan's motion to dismiss. Respondent filed its comment and opposition to the motion. (3) the City of Mandaluyong seeks to expropriate the said property without payment of just compensation. on March 13. the city of Mandaluyong filed a complaint[5] for expropriation with the Regional Trial Court of Pasig. the City of Mandaluyong assumed possession of the subject property by virtue of a writ of possession issued by the trial court on .

that pursuant to article 36. Rule VI of the Implementing Rules and Regulations (IRR) of RA 7160.. the court granted the assailed order of expropriation. a "resolution" empowering the City Mayor to initiate such expropriation proceedings and thereafter when the court has already determine[d] with certainty the amount of just compensation to be paid for the property expropriated.[9] and not by means of a mere resolution. thus:[11] . 7160. Petitioner assert that the city of Mandaluyong may only exercise its delegated power of eminent domain by means of an ordinance as required by section 19 of Republic Act (RA) No. 1995. 1998.[10] Respondent contends. however.in the exercise of the respondent City of Mandaluyong's power of eminent domain. then follows an Ordinance of the Sanggunian Panlungosd appropriating funds for the payment of the expropriated property.[12] novero Petitioners refute respondent's contention that only a resolution is necessary upon the initiation of expropriation proceedings . Respondent's position. which was upheld by the trial court. a resolution is a sufficient antecedent for the filing of expropriation proceedings with the Regional Trial Court. was explained.[8] On July 28. that it validly and legally exercised its power of eminent domain.. title to the property expropriated shall pass from the owner to the expropriator only upon full payment of the just compensation.December 14. Admittedly.

our own Constitution provides that "[p]rivate property shall not be taken for public use without just compensation."[18] Furthermore.[15] Thus. . explaining that the resolution mentioned in article 36 of the IRR is for purposes of granting administrative authority to the local chief executive to file the expropriation case in court and to represent the local government unit in such case. a power grounded in the primary duty of government to serve the common need and advance the general welfare.[14] It is an indispensable attribute of sovereignty.[13] The petition is imbued with merit. but does not dispense with the necessity of an ordinance for the exercise of the power of eminent domain under section 19 of the Code.[16] The provisions found in modern constitutions of civilized countries relating to the taking of property for the public use do not by implication grant the power to the government.and that an ordinance is required only in order to appropriate the funds for the payment of just compensation.[17] Thus. the right of eminent domain appertains to every independent government without the necessity for constitutional recognition. the due process and equal protection clauses[19] act as additional safeguards against the arbitrary exercise of this governmental power. but limit a power which would otherwise be without limit. Eminent domain is the right or power of a sovereign state to appropriate private property to particular uses to promote public welfare.

Chinese Community of Manila we said:[21] The exercise of the right of eminent domain. and. the plain meaning of the law should not be enlarged by doubt[ful] interpretation.Since the exercise of the power of eminent domain affects an individual's right to private property. whether directly by the State. No species of property is held by individuals with greater tenacity. constrains the strict observance of the substantial . is necessarily in derogation of private rights. It is to be watched with jealous scrutiny.. 576]. and none is guarded by the constitution and the laws more sedulously. appropriates the land of an individual without his consent.. In City of Manila vs. 13 Cal. (Bensley vs. 306 and cases cited [73 Am.[20] the need for its circumspect operation cannot be overemphasized. When the legislature interferes with that right. or by its authorized agents. Mountainlake Water Co. for greater public purposes. Dec. than the right to the freehold of inhabitants. a constitutionallyprotected right necessary for the preservation and enhancement of personal dignity and intimately connected with the rights to life and liberty. Important as the power may be to the government. and the rule in that case is that the authority must be strictly construed.) The statutory power of taking property from the owner without his consent is one of the most delicate exercise of governmental authority. the inviolable sanctity which all free constitutions attach to the right of property of the citizens.

That the power of eminent domain may not be exercised unless a valid and definite offer has been previously made to the owner. sec.) The power of eminent domain is essentially legislative in nature. 22 Phil. however. however. Provided.. upon payment of just compensation. . and such offer was not accepted. That the local government unit may immediately take possession of the property upon the filing of the expropriation proceedings and upon making a deposit with . although the scope of this delegated legislative power is necessarily narrower than that of the delegating authority and may only be exercised in strict compliance with the terms of the delegating law.. It is firmly settled. through its chief executive and acting pursuant to an ordinance. further. and to protect it from abuse. Tenorio vs. 411.provisions of the law which are prescribed as modes of the exercise of the power. other public entities and public utilities. and cases cited.[22] micks The basis for the exercise of the power of eminent domain by local government units is section 19 of RA 7160 which provides that: A local government unit may. or welfare for the benefits of the poor and the landless.. Manila Railroad Co. purpose. exercise the power of eminent domain for public use.. pursuant to the provisions of the Constitution and pertinent laws.].(Dillon on Municipal Corporations [5th Ed. 1040. that such power may be validly delegated to local government units. Provided.

as compared to instances when it is directly exercised by the national legislature. That the amount to be paid for the expropriated property shall be determined by the proper court. Provided. in behalf of the local government unit.the proper court of at least fifteen percent (15%) of the fair market value of the property based on the current tax declaration of the property to be expropriated.calr . finally. Despite the existence of this legislative grant in favor of local governments. it is still the duty of the courts to determine whether the power of eminent domain is being exercised in accordance with the delegating law. based on the fair market value at the time of the taking of the property.[24] The courts have the obligation to determine whether the following requisites have been complied with by the local government unit concerned: 1. An ordinance is enacted by the local legislative council authorizing the local chief executive. to exercise the power of eminent domain or pursue expropriation proceedings over a particular private property .[23] In fact. the courts have adopted a more censorious attitude in resolving questions involving the proper exercise of this delegated power by local bodies.

An ordinance is a law. Realty Corporation[26] regarding the distinction between an ordinance and a resolution. but a resolution is . The power of eminent domain is exercised for public use. and other pertinent laws. 4. for the exercise of the power of eminent domain. purpose or welfare. not a resolution.M. or for the benefit of the poor and the landless. as required under Section 9.2. We reiterate our ruling in Municipality of Parañaque v.[25] In the present case. There is payment of just compensation. A valid and definite offer has been previously made to the owner of the property sought to be expropriated. An ordinance possesses a general and permanent character. in contravention of the first requisite. 3. A municipal ordinance is different from a resolution. V. the City of Mandaluyong seeks to exercise the power of eminent domain over petitioners' property by means of a resolution. In that 1998 case we held that:miso We are not convinced by petitioner's insistence that the terms "resolution" and "ordinance" are synonymous. but said offer was not accepted. Article III of the Constitution. The law in this case is clear and free from ambiguity. Section 19 of the Code requires an ordinance. but a resolution is merely a declaration of the sentiment or opinion of a lawmaking body on a specific matter.

of condemnation declaring that the plaintiff has a lawful right to take the property sought to be condemned. beginning at this point. unless decided otherwise by a majority of all the Sanggunian members. We cannot uphold respondent's contention that an ordinance is needed only to appropriate funds after the court has determined the amount of just compensation. for the public use or purpose described in the complaint. it ends with an order. the power of eminent domain is already being exercised. but not for a resolution. (2) the second phase is concerned with the determination by the court of the just compensation for the property sought to be . the two are enacted differently -a third reading is necessary for an ordinance. An examination of the applicable law will show that an ordinance is necessary to authorize the filing of a complaint with the proper court since. if not in a dismissal of the action. Additionally.temporary in nature. upon the payment of just compensation to be determined as of the date of the filing of the complaint. Rule 67 of the 1997 Revised Rules of Court reveals that expropriation proceedings are comprised of two stages: (1) the first is concerned with the determination of the authority of the plaintiff to exercise the power of eminent domain and the propriety of its exercise in the context of the facts involved in the suit.

it is noted that as soon as the complaint is filed the plaintiff shall already have the right to enter upon the possession of the real property involved upon depositing with the court at least fifteen percent (15%) of the fair market value of the property based on the current tax declaration of the property to be expropriated. it is but the last stage of the expropriation proceedings. which cannot be arrived at without an initial finding by the court that the plaintiff has a lawful right to take the property sought to be expropriated. although the determination and award of just compensation to the defendant is indispensable to the transfer of ownership in favor of the plaintiff. resolving the question of whether or not the plaintiff has properly and legally exercised its power of eminent domain.basra Neither is respondent's position improved by its reliance upon Article 36 (a).[28] Therefore.[27] Clearly. this is done by the court with the assistance of not more than three (3) commissioners.taken. An order of condemnation or dismissal at this stage would be final. and not only after the court has determined the amount of just compensation to which the defendant is entitled. for the public use or purpose described in the complaint. an ordinance promulgated by the local legislative body authorizing its local chief executive to exercise the power of eminent domain is necessary prior to the filing by the latter of the complaint with the proper court. Rule VI of the IRR which provides that: . Also.

surely prevails over said rule which merely seeks to implement it. while we remain conscious of the constitutional policy of promoting local autonomy. also requires that. LGU may expropriate said property through a resolution of the sanggunian authorizing its chief executive to initiate expropriation proceedings. purpose. in exercising the power of eminent domain. This is clearly misplaced. Therefore. or welfare through purchase. what the discrepancy seems to indicate is a mere oversight in the wording of the implementing rules.If the LGU fails to acquire a private property for public use. The Court has already discussed this inconsistency between the Code and the IRR. since Article 32. Besides. we cannot grant judicial sanction to a local government unit's exercise of its delegated . in Municipality of Parañaque vs. It is axiomatic that the clear letter of the law is controlling and cannot be amended by a mere administrative rule issued for its implementation.[29] which we quote hereunder: Petitioner relies on Article 36.M. which requires only a resolution to authorize an LGU to exercise eminent domain. Realty Corporation. Rule VI thereof. the chief executive of the LGU must act pursuant to an ordinance. Rule VI of the Implementing Rules. because Section 19 of RA 7160. the law itself. which is more apparent than real. V.

1998 decision of Branch 155 of the Regional Trial Court of Pasig in SCA No. No.power of eminent domain in contravention of the very law giving it such power. February 13. L. Adoracion D. however. 2004] . 2004] ESTATE OR HEIRS OF THE LATE EX-JUSTICE JOSE B. REYES represented by their Administratrix and Attorney-In-Fact. petitioners. REYES. 137146. for so long as it has complied with all other legal requirements. The July 28. 875 is hereby REVERSED and SET ASIDE.R.R. that our ruling in this case will not preclude the City of Mandaluyong from enacting the necessary ordinance and thereafter reinstituting expropriation proceedings. REYES.[30] WHEREFORE. respondent. EDMUNDO A. Reyes. No. It should be noted. REYES and CARLOS P.akin THIRD DIVISION [G. February 13. and the ESTATE OR HEIRS OF THE LATE DR. the petition is hereby GRANTED. [G. CITY OF MANILA. represented by MARIA TERESA P. vs. 132431.

1998 which ordered the condemnation of petitioners’ properties and reversed the order*3+ of the Regional Trial Court (RTC) of Manila. Branch 9. ANGELINA MAGLONSO and SAMPAGUITA BISIG NG MAGKAKAPITBAHAY.: Before us are the following consolidated petitions filed by petitioners Heirs of Jose B. Reyes and Edmundo Reyes: (1) a petition for review[1] of the decision[2] of the Court of Appeals dated January 27. 1998 which issued a temporary restraining order against the Municipal Trial Court (MTC) of Manila. ROSARIO ABIOG. and (2) a petition for certiorari[4] alleging that the Court of Appeals committed grave abuse of discretion in rendering a resolution[5] dated August 19. COURT OF APPEALS. REYES and ESTATE OR HEIRS OF THE LATE DR. one of the members of SBMI. respondents.L. EDMUNDO REYES. Branch 10. INC. 1998 . J. Rosario Abiog. and the CITY OF MANILA. vs.L. until the Supreme Court has decided the Petition for Review on Certiorari” and a resolution*6+ dated December 16. petitioners. dated October 3.ESTATE OF HEIRS OF THE LATE EX-JUSTICE JOSE B. DECISION CORONA. 1995 dismissing the complaint of respondent City of Manila (City) for expropriation. not to “(disturb) the occupancy of Dr. DR.

The records show that Jose B. respectively. Block 2996 of the same consolidation plan. Upon his death. Reyes was substituted by his heirs. among whom are respondents Abiog. 1994 against respondent .” The undisputed facts follow.[8] On November 9. These parcels of land are being occupied and leased by different tenants. Branch 10. the Metropolitan Trial Court (MTC) of Manila. L. Manila and covered by Transfer Certificate of Title No. In Civil Case No. 1994. with an area of 191 square meters[7] and to respondent Maglonso. Incorporated (SBMI). rendered a decision dated May 9. Petitioners obtained favorable judgments against said respondents. Block 3007 of the consolidated subdivision plan (LRC) Psd.L. Jose B. Lot 2-R. Jose B.328345.enjoining petitioners “from disturbing the physical possession of all the properties subject of the expropriation proceedings. 142851-CV. 24359 issued by the Register of Deeds of Manila. Cruz District. 1993 and May 26. Petitioners leased to respondent Abiog Lot 2-E.940 square meters situated at Sta. Reyes and petitioners Heirs of Edmundo Reyes are the pro-indiviso co-owners in equal proportion of 11 parcels of land with a total area of 13.L. among others. Reyes and petitioners Heirs of Edmundo Reyes filed ejectment complaints against respondents Rosario Abiog and Angelina Maglonso. with an area of 112 square meters. Maglonso and members of respondent Sampaguita Bisig ng Magkakapitbahay.

the judgments of eviction against respondents Abiog and Maglonso became final and executory in 1998. during the pendency of the two ejectment cases against respondents Abiog and Maglonso. 1995 a complaint for eminent domain (expropriation)[11] of the properties of petitioners at the RTC of Manila. Tecson. more or less. Their appeals to the Court of Appeals were likewise denied. Sulu. Branch 38. M. Reyes and Edmundo Reyes situated along the streets of Rizal Avenue. Maglonso and members of respondent SBMI. Aurora Boulevard. the MTC of Manila.L. Natividad. M. The properties sought to be acquired by the City included parcels of land occupied by respondents Abiog.[10] As no appeals were further taken. Sampaguita. Meanwhile. Branch 28. The complaint was based on Ordinance No. owned by Jose B. Oroquieta. issued judgment dated May 4. 7818 enacted on November 29.930 square meters. Respondents Abiog and Maglonso appealed the MTC decisions but the same were denied[9] by the RTC of Manila. 1995 against respondent Maglonso. In Civil Case No. These parcels of land are . and the RTC of Manila. 144205-CV.Abiog. Branch 9. 1993 authorizing the City Mayor of Manila to expropriate certain parcels of land with an aggregate area of 9. Felix Huertes. Bulacan. Branch 3. respectively. Pedro Guevarra and Kalimbas in the third district of Manila. respondent City filed on April 25. Hizon.

on March 10. Block 2996. a registered non-stock corporation composed of the residents of the subject properties (including as well as representing herein respondents Abiog and Maglonso). filed a motion for intervention and admission of their attached complaint with prayer for injunction. On May 15. Block 2995.more particularly described in the pertinent Cadastral Plan as Lot 3. Lot 2. who were “the occupants of the said parcels of land who (had) been occupying the said lands as lessees or any term thereof for a period of at least 10 years.285.”*12+ The complaint alleged that. According to the ordinance.684.452. and Lot 2.657 or 15% of the aforesaid value. 1995. sent the petitioners a written offer to purchase the subject properties for P10. Jr. Block 3007. Respondent SBMI alleged that it had a legal interest over the subject matter of the litigation as its members were the lawful beneficiaries of the subject matter of the case.38 but the same was rejected. It prayed for the issuance of a temporary restraining order to enjoin the petitioners from .293. Lot 5. 1995. Respondent City prayed that an order be issued fixing the provisional value of the property in the amount of P9. Block 2999. respondent SBMI. Block 2999.380 based on the current tax declaration of the real properties and that it be authorized to enter and take possession thereof upon the deposit with the trial court of the amount of P1. the said properties were to be distributed to the intended beneficiaries. respondent City thru City Legal Officer Angel Aguirre. Lot 2.

remote. petitioners filed a motion to dismiss the complaint for eminent domain for lack of merit.00.520. it (was). that under Department Order No.00. the guidelines for their equitable valuation shall be set by the Department of Finance on the basis of the market value reflected in the zonal valuation conformably to Sec. if it (existed) at all. through the Bureau of Internal Revenue. conjectual (sic). the zonal valuation of the subject property is conservatively estimated at approximately P76M. 1995 on the ground that “the movants’ interest (was) indirect. 7279.A. . At the very least. that since the subject property is allegedly being expropriated for socialized housing. 13 of R.ousting the occupants of the subject properties.928.942. consequential (sic) and collateral. or in sheer expectancy of a right that may or may not be granted. contingent. 33-93 adopted by the Department of Finance. No. on 26 April 1992. the deposit should be at least 15% of the fair market value of the property based on the current tax declaration of the property to be expropriated which is P19. The trial court denied the motion for intervention in an order dated June 2.619. 19 of the Local Government Code of 1991 provides that in order for the plaintiff to take possession of the property. purely inchoate. Among the grounds alleged were the following: xxx that the amount allegedly deposited by the plaintiff is based on an erroneous computation since Sec.”*13+ On the day SBMI’s motion for intervention was denied. 15% of which is P2.

9(t) of R.A. the trial court allowed respondent City to take possession of the subject property upon deposit of the amount of P1. the necessary locational clearance and other requirements imposed under existing laws.38 offer by respondent City to petitioners which the trial court fixed as the provisional amount of the subject properties.[14] On June 6. 1995. based on the P10.542.293. 7279. and that the plaintiff failed to comply with Art.793. Rule 6 of the Rules and Regulations Implementing the Local Government Code of 1991 which requires the local government unit to first establish the suitability of the property to be acquired for the use intended and then proceed to obtain from the proper authorities. respondent City filed an opposition to petitioners’ motion to dismiss. 1995.285. rules and regulations. the money to be paid should be channeled to the development of 244 sites in Metro Manila designated as area for priority development. that the tenants occupying the subject property cannot be categorized as “underprivileged and homeless citizens” or those whose income falls within the poverty threshold to be qualified as beneficiaries of the intended socialized housing. . On June 14. that instead of expropriating the subject property which enjoys the least priority in the acquisition by the City of Manila for socialized housing under Sec. that the City Ordinance was not properly adopted since there was no public hearing and neither were the defendants notified. 34.that the plaintiff has no savings or unappropriated funds to pay for the just compensation. like the National Housing Authority.

Respondent City’s motion for reconsideration was denied. 1997.[15] The trial court held that expropriation was inappropriate because herein petitioners were in fact willing to sell the subject properties under terms acceptable to the purchaser. the Court of Appeals issued a resolution[17] denying the motions for lack of merit. respondent City failed to show that its offer was rejected by petitioners. several motions[16] seeking the issuance of a temporary restraining order and preliminary injunction were filed by respondent City to prevent petitioners from ejecting the occupants of the subject premises. 1996. the MTC of Manila. Moreover. Branch 10. the City’s complaint for eminent domain was dismissed. issued a writ of execution. Respondent City’s motion for reconsideration was likewise denied. On March 21. on January 27. Thereafter. On January 31. 1996. respondent SBMI filed in the Court of Appeals a motion for leave to intervene with prayer for injunctive relief praying that the ejectment cases be suspended or that the execution thereof be enjoined in view of the .On October 3. respondent City appealed the decision of the trial court to the Court of Appeals. On January 12. 1997. Meanwhile. in view of the finality of the judgment in the ejectment case against respondent Abiog. 1995.

on August 25. SO ORDERED. The dispositive portion of the decision stated: WHEREFORE. 1997 of the Hon. the Court of Appeals rendered the assailed decision reversing the trial court judgment and upholding as valid respondent City’s exercise of its power of eminent domain over petitioners’ properties. the Court of Appeals issued a resolution[18] finding prima facie basis to grant SBMI’s motions. a reiteratory motion for issuance of temporary restraining order and to stop the execution of the order dated June 27.pendency of the expropriation case filed by respondent City over the same parcels of land. After the hearing on the propriety of the issuance of a writ of preliminary injunction. MTC of Manila. 1997. 1997. 1998. Branch 10. respondent SBMI filed a reiteratory motion for injunctive relief on December 11. As a follow-up. the Orders appealed from are hereby REVERSED and SET ASIDE. On January 27. Judge Tranquil P. It issued a temporary restraining order to Judge Salvador. his employees and agents to maintain the status quo. respondent Abiog filed in the appellate court. 1997. On August 26. Salvador.[19] . The case is remanded to the lower court to determine specifically the amount of just compensation.

xxx. through the City Legal Office. This conclusion by the lower court is belied by the letter of Adoracion D. dated 17 March 1995. Ordinance No. Another reason for the lower court’s dismissal was its finding that there was no proof that the offer of the plaintiff-appellant. such as political motivation. Reyes. the lower court erred in dismissing the complaint based on unsupported accusations and mere speculations. xxx xxx xxx . The fact that the expropriation proceeding was not immediately instituted does not negate the existence of the public purpose for which the ordinance was enacted. xxx xxx xxx xxx In the absence of any law which expressly provides for a period for filing an expropriation proceeding. 7818 expressly states that the subject parcels of land are to be distributed to the landless poor residents therein who have been in possession of the said property for at least ten (10) years. was not accepted.According to the Court of Appeals: xxx there is no doubt as to the public purpose of the plaintiffappellant in expropriating the property of the defendantsappellees.

some of the tenants have already purchased the land that they occupy. was totally turned down. petitioners filed on March 19. in fact. we agree with the plaintiff-appellant that the contracts entered into by the defendants-appellees with some of the tenants do not affect the offer it made. Alleging that respondent City cannot expropriate the subject parcels of land. in the words of the defendant-appellee. The plaintiffappellant was not a party in those transactions and as pointed out.[20] From the aforementioned decision of the Court of Appeals. its concern is the majority of those who have no means to provide themselves with decent homes to live on. petitioners assigned the following as errors of the Court of Appeals: The Court Appeals committed grave abuse and irreversible errors in holding that respondent City of Manila may expropriate petitioners’ parcels of land considering that: . The lower court in denying the plaintiff-appellant’s motion for reconsideration of the order of dismissal held that the defendants-appellees were actually willing to sell. However. 1998 the present petition for review[21] before this Court.There can be no interpretation of the letter of the defendantappellee other than that the valid and definite offer of the plaintiff-appellant to purchase the subject property was not accepted and.

. 34 of the Local Government Code of 1991 (sic). V. IV. What followed were incidents leading to the filing of the petition for certiorari against the resolutions of the Court of Appeals which essentially sought to enjoin the petitioners from enforcing the final judgments against respondents Abiog. There was no valid and definite offer by the respondent City of Manila to purchase subject parcels of land. respondent occupants) in the ejectment cases. Maglonso and SBMI (hereinafter.D. VI. 7279. otherwise known as the “Urban Development and Housing Act of 1992 and Sec. 9 and 10 of P. Petitioners are not unwilling to sell the subject parcels of land. 7818 enacted by the City of Manila is violative of the equal protection clause. the amount deposited for the payment of just compensation was insufficient.” II. Respondent did not comply with Secs. Ordinance No. (sic) No. [22] There was no pronouncement as to just compensation.I. Assuming there was a valid offer. III.

respondents Abiog and Maglonso filed in the Court of Appeals an urgent motion for protective order. are hereby TEMPORARILY RESTRAINED from disturbing the occupancy of Dr.On August 17. the respondents’ motions for “protective order” sought to stop the execution of the final and executory judgments in the ejectment cases against them. Meanwhile. the Municipal Trial Court of Manila. Branch 10 and Sheriff Jess Areola or any other sheriff of the City of Manila. a writ of execution of the final judgment in the other ejectment case against respondent Maglonso. On September 4. Rosario Abiog. 1998. the Court of Appeals promulgated the first assailed resolution.[23] the dispositive portion of which read: Considering that this case has been elevated to the Supreme Court. petitioners filed a motion to set aside as ineffective and/or null and void the said August 19. respondent SBMI filed in the CA a similar motion for protective order. Branch 3. In essence. one of the members of the SBMI until the Supreme Court has decided the Petition for Review on Certiorari. 1998. 1998. 1998 resolution. On October 19. On August 19. petitioners were able to secure from the MTC of Manila. on September 8. 1998. 1998. But the Court of Appeals denied the same in a .

xxx xxx xxx There is no doubt that the members of SBMI have a personality to intervene before this Court.L.resolution dated December 16.[24] the dispositive portion of which read: WHEREFORE. the appellate court held that: We do not agree with the contention of the defendantsappellees that we no longer have any jurisdiction to issue the subject resolution. Reyes and all persons acting in their behalf are hereby ENJOINED from disturbing the physical possession of all the properties (sic) subject of the expropriation proceedings. SO ORDERED. in their Comment to the defendants-appellees’ motion to set aside this Court’s 19 August 1998 resolution. the Estate or heirs of J. as one of the intended beneficiaries of the expropriation . In enjoining the petitioners from evicting respondent occupants and in effect suspending the execution of the MTC judgments.B. Rosario Abiog. the appellate Court still has the inherent power and discretion to amend whatever order or decision it had made before in order to render substantial justice. The plaintiff-appellant itself. In spite of having rendered the decision on 27 January 1998. 1998. recognized Dr.

If the petition. the remedy is to compel the plaintiff to deliver the lot to them.case. . Moreover. and if the plaintiff would distribute the property to other persons. that would be the time for the movant to intervene. is granted. The plaintiff-appellant also enumerated the ejectment cases pending before the lower courts when it filed a motion for the issuance of temporary restraining order and/or writ of preliminary injunction upon appeal to this Court. the defendants-appellees. The petition could well be denied leaving any assertion of interest on the part of the movant absolutely untenable. the intervenors then have the right to seek protection from this Court. Having established that they are the intended beneficiaries. to show that they are the intended beneficiaries. on the other hand. In their motion to set aside the 19 August 1998 resolution. the plaintiff-appellant also furnished this Court with a copy of the THIRD PARTY CLAIM it filed before the City Sheriff Office and Sheriff Dante Lot to enjoin them from implementing and executing the Demolition Order issued by the Metropolitan Trial Court of Manila (Branch 3) against Angelina Maglonso. quoting the Order of the lower court denying the motion for intervention stated that: The petition of the plaintiff to expropriate the property does not ipso facto create any fiat that would give rise to the claim of the movant of “legal interest” in the property.

In the case of Lourdes Guardacasa Vda. There is nothing in the record that would show that the order of possession was ever set aside or the deposit returned to the plaintiff-appellant. we find that the intervenors are entitled to the injunction that they prayed for. Hon. Herminion A. Avendano. The record before us shows that on 6 June 1995. To allow the demolition of the premises of the intervenors would defeat the very purpose of expropriation which is to distribute the subject property to the intended beneficiaries who are the occupants of the said parcels of land who have been occupying the said lands as lessees or any term thereof for a period of at least ten (10) years. Based on the foregoing considerations. et al. the Supreme Court ordered the suspension of the enforcement and implementation of the writ of execution and order of demolition issued in the ejectment case until after the final termination of the action for quieting of title because it is more equitable and just and less productive of . we held that the plaintiff-appellant validly exercised its power of eminent domain and consequently may expropriate the subject property upon payment of just compensation.00 deposit. the lower court allowed the plaintiff-appellant to take possession of the subject property upon filing of P1.On 27 January 1998.793. De Legaspi vs. The property to be expropriated includes the same properties subject of the ejectment cases against the intervenors..542.

.. 132431. II ASSUMING ARGUENDO THAT PUBLIC RESPONDENT COURT OF APPEALS COULD ISSUE SUCH ORDER.[25] Claiming that the Court of Appeals committed grave abuse of discretion amounting to lack or excess of jurisdiction. vs.R. which is the situation in the case at bar. execution of the decision in the ejectment case would also have meant demolition of the premises.confusion and disturbance of physical possession with all its concomitant inconvenience and expenses. the exception to the rule in the case of Vda. et al. et al. De Legaspi case. NO. petitioners filed the subject petition for certiorari[26] with the following assignments of error: I PUBLIC RESPONDENT COURT OF APPEALS HAS NO JURISDICTION IN ISSUING THE “PROTECTIVE ORDER” ENJOINING THE EXECUTION OF THE FINAL AND EXECUTORY JUDGMENTS IN THE EJECTMENT CASES AGAINST PRIVATE RESPONDENTS BECAUSE THE POWER TO ISSUE SUCH ORDER HAS BEEN LODGED WITH THE HONORABLE COURT IN VIEW OF THE PENDENCY OF G. Hon. Court of Appeals. As held in Wilmon Auto Supply Corp. IT ACTED WITH GRAVE .

1998). Inc.ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN ISSUING THE PROTECTIVE ORDER IN FAVOR OF PRIVATE RESPONDENTS BECAUSE IT HAS LONG BEEN SETTLED THAT THEIR INTERESTS IN THE PROPERTIES SUBJECT OF THE EXPROPRIATION CASE ARE NOT SUFFICIENT FOR THEM TO BE DECLARED AS INTERVENORS. vs. 125218. 1998) and Filstream International. Judge Tongco and the City of Manila (G. vs. following the ruling in Filstream International. No. IV PRIVATE RESPONDENTS’ ACT OF SEEKING THE PROTECTIVE ORDER FROM THE COURT OF APPEALS. Malit et al. No.R. (G. January 23. CA.[27] .R. January 23. Inc. DESPITE THE FINALITY OF THE ORDER BY THE TRIAL COURT DISALLOWING INTERVENTION. V The assailed resolutions of the Court of Appeals should be set aside. CA. CONSTITUTES FORUM SHOPPING. III THE SO-CALLED PROTECTIVE ORDER IS AN INJUNCTIVE RELIEF IN DISGUISE. 128077.

respondent City did not make a valid and definite offer to purchase the subject properties. According to respondent City. No 132431. On the sufficiency of the amount deposited. respondent City’s act of expropriation is illegal because it did not comply with Sections 9 and 10 of Republic Act No. It is therefore safe to say that the offer to purchase can be made before the actual filing of the complaint.In G. 7279 (The Urban Development and Housing Act of 1992). petitioners allege: (1) that Ordinance 7818 is unconstitutional for violating the equal protection clause of the 1987 Constitution and for abridging the “contracts” between petitioners and prospective buyers of the subject parcels of land. The actual exercise of the power of eminent domain begins only upon the filing of the complaint for eminent domain with the RTC by the Chief Executive and not when an ordinance pursuant thereto has been enacted. whether that is before or after the ordinance is enacted. the amount offered was insufficient. (3) that. in insisting that its offer was valid and that the amount it deposited was sufficient.[28] On the other hand. and (4) that. assuming the offer as valid. respondent City reiterates the reasons cited by the Court of Appeals. respondent City alleges that the determination of the provisional value of the . (2) that.R. there is nothing in the Local Government Code of 1991 which requires the offer to be made before enacting an enabling ordinance. in expropriating the subject properties. prior to the filing of the eminent domain complaint.

793 (15% of P10. respondent City filed its compliance dated June 13. On the basis of this order. 137146 (the petition for certiorari questioning the resolutions of the Court of Appeals which issued a temporary restraining order and ordered the parties to maintain the status quo). second. petitioners assail the resolutions of the Court of Appeals which in effect enjoined the MTC of Manila. only this Court and not the Court of Appeals has jurisdiction to enjoin the execution of the judgments in the ejectment cases considering that the expropriating case is now being reviewed by this Court.” In G. 1995. who wrote respondent City that “it is the consensus of the heirs xxx to turn down as we are totally turning down your offer to purchase the parcels of land subject matter of the aforesaid ordinance.property was judicially determined by the trial court at P10. the orders are void as they protect an alleged right that does not belong to respondent City but to a non-party in the . Adoracion Reyes. Branches 9 and 10. or your offer is not acceptable to us in every respect. No. Respondent City also claims that all along petitioners were not willing to sell the subject parcels of land as proved by the tenor of the letter of petitioners’ agent. first.38).293.38 in its order dated June 6.285. from enforcing the final judgments in the ejectment cases while the appeal from the decision involving the same parcels of land in the expropriation case remains pending before this Court.293.R. Petitioners maintain that.452. 1995 manifesting the deposit of the additional amount of P1.285.

as forum-shopping. Section 9(1)[30] of BP 129 (The Judiciary Reorganization Act of 1980) is broad enough to include “protective orders. as the undisputed rightful beneficiaries of the expropriation. respondent occupants aver the following: first. last. Rule 58 of the Rules of Court[29]. said orders deprive petitioners of their property without due process of law because they amount to a second temporary restraining order which is expressly prohibited by Section 5. with more reason does it have the power to annul judgments of the MTC. their motion for reconsideration of the trial court order denying their motion to intervene was never ruled upon as it became moot and academic. they have the right to intervene. Due to the dismissal of the complaint for expropriation. their right to intervene has never been barred with finality. second. To justify the propriety of their intervention and the legality of the assailed resolutions. petitioners brand respondent occupants’ act of seeking the assailed “protective order.expropriation case. third.” despite the finality of the trial court order disallowing intervention. .” If the Court of Appeals has the power to annul judgments of the RTC. third. The trial court’s silence does not mean a denial of the intervention and injunction that respondent occupants prayed for.

fifth. In 1998. writs of execution were issued. Before proceeding to the discussion of the issues. The expropriation case should be considered as a supervening event that necessitated a modification. Moreover. it is more appropriate in the interest of equity and justice to preserve the status quo pending resolution by this Court of petitioners’ appeal in the expropriation case because they are anyway the beneficiaries of the subject properties. the causes of action in the two cases were different and distinct from each other. in the motion for protective order. it would be best to first recapitulate the confusing maze of facts of this case. respondents sought to enjoin the execution of the decisions in the ejectment cases against them. On the other hand. During the pendency of the complaints for unlawful detainer. suspension or abandonment of the MTC decisions. respondents are not guilty of forum-shopping for the reason that the Court of Appeals never made a ruling or decision on respondents’ motion to intervene. respondent City filed a case for the expropriation of the same . Consequently. It is not disputed that the petitioners acquired a favorable judgment of eviction against herein respondents Abiog and Maglonso. In the motion to intervene.fourth. respondent occupants sought to be recognized and included as parties to the expropriation case. the said judgments became final and executory.

on motion of respondent occupants. it denied the motions for intervention and injunction. On appeal. and. numerous motions to intervene and motions for injunction were filed in the expropriation case by respondents. the Court of Appeals reversed the trial court and found that respondent City properly exercised its right to expropriate the subject properties. Petitioner is now before us questioning the legality of the CA’s expropriation order and the propriety of its act enjoining the execution of the final judgments in the ejectment cases. The trial court allowed respondent City to take possession of the property.properties involved in the ejectment cases. With these given facts. after allowing respondent City to oppose the motion to dismiss. From thereon. Before . it is imperative to first resolve the issue of whether the respondent City may legally expropriate the subject properties. Thereafter. considering that a negative finding will necessarily moot the issue of the propriety of the “protective orders” of the Court of Appeals. Petitioners appealed the CA decision to this Court. Whether respondent City deprived petitioners of their property without due process of law depends on whether the City complied with the legal requirements for expropriation. the Court of Appeals issued protective orders that required the parties to maintain the status quo (prohibiting any ejectment) pending this Court’s resolution of the appeal. dismissed the complaint for expropriation.

including governmentowned or –controlled corporations and their subsidiaries.respondent City can exercise its power of eminent domain. the same must be sanctioned and must not violate any law. Being a mere creation of the legislature. a local government unit can only exercise powers granted to it by the legislature. is also mandated to follow the conditions and standards prescribed by RA 7279 (the Urban Development and Housing Act of 1992). (b) Alienable lands of the public domain.[33] Respondent City. Priorities in the acquisition of Land – Lands for socialized housing shall be acquired in the following order: (a) Those owned by the Government or any of its subdivisions. 9. the latter being mere creations of the former.[31] When it expropriated the subject properties. however. the law governing the expropriation of property for urban land reform and housing. or agencies. The latter specifically gives respondent City the power to expropriate private property in the pursuit of its urban land reform and housing program. Such is the nature of the constitutional power of control of Congress over local government units. Sections 9 and 10 of RA 7279 specifically provide that: Sec. respondent City relied on its powers granted by Section 19 of the Local Government Code of 1991[32] and RA 409 (The Revised Charter of the City of Manila). . instrumentalities.

land swapping. (d) Those within the declared Areas of Priority Development. community mortgage. and Slum Improvement and Resettlement Program sites which have not yet been acquired. that . joint venture agreement. Where on-site development is found more practicable and advantageous to the beneficiaries. donation to the Government. The local government units shall give budgetary priority to on-site development of government lands. however. negotiated purchase. Modes of Land Acquisition. among others. and (f) Privately-owned lands. land banking. – The modes of acquiring lands for purposes of this Act shall include. Zonal Improvement sites. finally. (e) Bagong Lipunan Improvement sites and Services or BLISS sites which have not yet been acquired. parcels of land owned by small property owners shall be exempted for purposes of this Act: Provided. That where expropriation is resorted to. That expropriation shall be resorted to only when other modes of acquisition have been exhausted: Provided further. the priorities mentioned in this section shall not apply. 10. Sec. land assembly or consolidation. and expropriation: Provided.(c) Unregistered or abandoned and idle lands.

The Court of Appeals was likewise silent on this specific jurisdictional issue.[34] we held that the abovequoted provisions are limitations to the exercise of the power of eminent domain. Compliance with these conditions is mandatory because these are the only safeguards of oftentimes helpless owners of private property against violation of due process when their property is forcibly taken from them for public use. This is a clear violation of the right to due process of the petitioners. as herein defined. respondent City in its pleadings failed to show its compliance with the law. Even in the Court of Appeals. We find that herein respondent City failed to prove strict compliance with the requirements of Sections 9 and 10 of RA 7279. [italics supplied] In Filstream vs. Private lands rank last in the order of priority for purposes of socialized housing. .abandoned property. Court of Appeals. specially with respect to the order of priority in acquiring private lands and in resorting to expropriation proceedings as a means to acquire the same. Respondent City neither alleged in its complaint nor proved during the proceedings before the trial court that it complied with said requirements. shall be reverted and escheated to the State in a proceeding analogous to the procedure laid down in Rule 91 of the Rules of Court. In the same vein. expropriation proceedings are to be resorted to only after the other modes of acquisition have been exhausted.

In that case. Manila. Meanwhile. the case was elevated to this Court for review of the power of the City to expropriate the Filstream’s properties. the occupants and respondent City filed in separate branches of the RTC of Manila several petitions for certiorari with prayer for injunction to prevent the execution of the judgments in the ejectment cases. The trial court denied the motion. on the strength of Ordinance 7818 (the same ordinance used by herein respondent City as basis to file the complaint for eminent domain). the Court of Appeals denied Filstream’s petition on a technical ground. On appeal. When the judgment in the ejectment case became final. After the consolidation of the petitions for certiorari.We also take note of the fact that Filstream is substantially similar in facts and issues to the case at bar. It thereafter filed a motion to dismiss the expropriation complaint but the trial court denied the same and ordered the condemnation of the subject properties. respondent City initiated a complaint for expropriation of Filstream’s properties in Tondo. for the benefit of the residents thereof. But prior thereto. Filstream filed a motion to dismiss and the City opposed the same. Manila. The dismissal was appealed to the Court of Appeals which reversed the trial court’s dismissal and granted respondent’s prayer for . the designated branch of RTC Manila dismissed the cases on the ground of forum-shopping. Filstream acquired a favorable judgment of eviction against the occupants of its properties in Tondo. Filstream was able to obtain a writ of execution and demolition. Thus.

which appeal was consolidated with the earlier petition for review of the decision of the Court of Appeals in the main expropriation case. Petitioners Filstream’s properties were expropriated and ordered condemned in favor of the City of Manila sans any showing that resort to the . 10 of R.A. In order to determine whether private respondents are entitled to the injunctive reliefs granted by respondent CA. 9 and Sec. we deemed it proper to extract the source of discord. Filstream appealed the same to this Court.injunction. we find no reason to depart from our ruling in said case. Due to the substantial resemblance of the facts and issues of the case at bar to those in Filstream. xxx xxx xxx Proceeding from the parameters laid out in the above disquisitions. we now pose the crucial question: Did the city of Manila comply with the abovementioned conditions when it expropriated petitioner Filstream’s properties? We have carefully scrutinized the records of this case and found nothing that would indicate the respondent City of Manila complied with Sec. 7279. To quote: The propriety of the issuance of the restraining order and the writ of preliminary injunction is but a mere incident to the actual controversy which is rooted in the assertion of the conflicting rights of the parties in this case over the disputed premises.

[36] . its complaint for expropriation must necessarily fail. Evidently. it must be emphasized that the State has a paramount interest in exercising its power of eminent domain for the general good considering that the right of the State to expropriate private property as long as it is for public use always takes precedence over the interest of private property owners.[35] Due to the fatal infirmity in the City’s exercise of the power of eminent domain. Indeed. bearing in mind that the exercise of this superior right cannot override the guarantee of due process extended by the law to owners of the property to be expropriated. there was a violation of petitioner Filstream’s right to due process which must accordingly be rectified. it is needless to discuss the constitutionality of Ordinance 7818.acquisition of other lands listed under Sec. Considering that the consolidated cases before us can be completely resolved by the application of our Filstream ruling. 9 of RA 7279 have proved futile. In this regard. However we must not lose sight of the fact that the individual rights affected by the exercise of such right are also entitled to protection. We herein apply the general precept that constitutional issues will not be passed upon if the case can be decided on other grounds. vigilance over compliance with the due process requirements is in order.

J. WHEREFORE. Vitug. the petition for certiorari questioning the validity of the Court of Appeals resolutions (allowing respondent occupants to intervene and granting their motion to enjoin the execution of the executory judgments in the ejectment cases) becomes moot and academic.R. concur. no part. No.R. In G. the petitions are hereby GRANTED. 132431.. [2] Penned by Associate Justice Eubulo G. 1998 and December 16. Verzola and concurred in by Associate Justices Jorge S. Imperial and Artemio G.R. pp. 132431. (Chairman). 132431. SO ORDERED. No. 137146. 1998 are hereby REVERSED and SET ASIDE. 45-56. deliberation. the decision of the Court of Appeals dated January 27.R. Tuquero of the Fourth Division. Did not participate in the . JJ. In G. No. [1] Docketed as G. and Carpio-Morales. Rollo of G.. Sandoval-Gutierrez. the resolutions of the Court of Appeals dated August 19. 1998 is hereby REVERSED and SET ASIDE. No.In view of the dismissal of the complaint for expropriation and the favorable adjudication of petitioners’ appeal from the decision of the Court of Appeals on the expropriation of the subject properties.

Rollo of G. 129-133. 137146. Rollo of G.. 73-75. 45-52. 137146. Tuquero. 137146. pp. 137146. pp.R.R. 97. [10] Ibid. 42-43. [4] Docketed as G.R. Tuquero.R. [9] Ibid. pp. No. pp. [6] Penned by Associate Justice Eubulo Verzola and concurred in by Associate Justices Jorge S. p. 99-110. [13] Records. pp. Rollo of G. No. 47. 95-73687. pp. 136-148.. No.R. [12] Rollo of G. 114-119.[3] Penned by Judge Edilberto Sandoval. No. 170-171. [5] Penned by Associate Justice Eubulo Verzola and concurred in by Associate Justices Jorge S. p. Imperial and Artemio G. [7] Rollo of G. [14] Records. No. [8] Ibid. 73-74. 132431. No. pp.R. 77-78. Imperial and Artemio G. 132431. . [11] Docketed as Civil Case No. pp.

[17] Penned by Associate Justice Pedro Ramirez and concurred in by Associate Justice Ma. p.R. a Reiteration of Supplement to Urgent Motion for Injunctive Relief and an Urgent Ex-Parte Motion for Temporary Restraining Order. 309. 132431. pp.R. 184-189. 137146. No. Asuncion and concurred in by Associate Justice Minerva P. 132431. Verzola of the Eighth Division. p. No.R. 204-207. [21] Docketed as G. Gonzaga-Reyes (retired Associate Justice of the Supreme Court) and Eubulo G.[15] Rollo of G. Alicia Austria-Martinez (now Associate Justice of the Supreme Court) and Bernardo Salas of the Fifth Division.R. [19] Rollo of G. 56. No. 132431. p.R. No. [20] Rollo of G. No. pp. Rollo of G. 52-54. No.R. . 132431. 231. [18] Penned by Associate Justice Maximiano C. [22] Rollo of G. 137146. [16] Urgent Motion for the Issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction.R. 137146. pp. No. Rollo of G.

[24] Penned by Justice Eubulo G. Barcelona and Artemio G. 137146. 43. 137146. the beneficiaries of the subject properties are “the occupants of the said parcels of land who have been occupying the said lands as lessees or any term thereof for a period of at least ten (10) years. 16-17. The ordinance failed to justify the distinction between a 10-year and a less-than-10-year occupant.[23] Penned by Justice Eubulo G. Special Former Fourth Division. No.” Petitioners contend that the distinction between lessee and non-lessee is not germane to the purpose of the law. [28] Petitioners pray that Ordinance 7818 be declared unconstitutional because it violated the “equal protection clause” of the 1987 Constitution. 48. [25] Rollo of G. Verzola and concurred in by Justices Ramon A. to give the land to the landless residents. 50-51. it also discriminates against other occupants who may also be landless. 137146. Rollo of G. Verzola and concurred in by Justices Jorge S. Likewise. Tuquero. p.R. the tenants had pending . Prior to the expropriation. p. Former Fourth Division. 137146.R. pp. pp. No. No.. By including only 10-year occupants. According to the ordinance. [27] Rollo of G. Imperial and Artemio G. the ordinance impaired the contractual rights of petitioners.R. [26] Under Rule 65 of the 1997 Rules of Civil Procedure. Tuquero. Rollo of G.e. 52. No. i.R.

Respondent cannot therefore make any offer which may be considered definite as the ordinance which authorized it to expropriate the subject parcels of land did not even appropriate a specific and determinate sum of money for . respondent City violated Sections 9 and 10 of RA 7279 by not complying with the procedure laid down by said provisions. “none of our tenants desired to negotiate with us to purchase that (sic) portions of the subject parcels of land being respectively leased by them.” Clearly. They even point out that the subject parcels of land are not included in the 244 sites in Metropolitan Manila designated as area for priority development under PD 1967 (An Act Amending Proclamation No. Court of Appeals (284 SCRA 716 [1998]). “the funds necessary for paying just compensation shall come from the unappropriated fund and/or savings of the City Government. respondent City did not provide a specific amount of money for the expropriation of the subject properties. petitioners also aver that.) Petitioners likewise contend that respondent City did not make a definite and valid offer prior to the filing of the complaint for expropriation. in expropriating the properties.” Quoting Filstream vs. 1893 By Specifying 244 Sites in Metropolitan Manila as Area for Priority and Urban Land Reform Zones. But after the passage of the ordinance.negotiations with petitioners for the purchase of the portions of the subject properties. According to Section 3 of the Ordinance 7818.

942.619.452. Thus. respondent City prayed that it be allowed to enter and take possession of the subject parcels of land “upon the deposit of P1. . had no legal basis.520. Under Section 19 of the Local Government Code of 1991.657 which is fifteen (15%) percent of the (assessed value)” of the property.928. the deposit should be 15% of the fair market value of the property. the temporary restraining order is deemed automatically not vacated. In the complaint. The amount deposited was therefore insufficient. assuming arguendo that the offer was valid.36 stated in its letter offering to buy the properties from the petitioners. The effectivity of a temporary restraining order is not extendible without need of any judicial declaration to renew the same on the same ground for which it was issued. Petitioners contend that the fair market value of the parcels of land based on the current tax declarations is P19. the amount deposited for the payment of just compensation was insufficient. 15% of which is P2. Preliminary injunction not granted without notice. – xxx xxx xxx In the event that the application for preliminary injunction is denied or not resolved within the said period.293.285.the purpose. exception. Last. 5. the amount of P10. [29] SEC.

or purpose. December 3. pursuant to the provisions of the Constitution and pertinent laws: Provided. exercise the power of eminent domain for public use. al. vs. that the power of eminent domain may not be exercised unless a valid and definite offer has been previously made to the owner. and auxiliary writs or processes. 2002.xxx xxx xxx [30] SECTION 9. G. Eminent Domain – A local government unit may. however. through its chief executive and acting pursuant to an ordinance. certiorari. whether or not in aid of its appellate jurisdiction. Judge Dadole et. 125350. Commission on Audit. upon payment of just compensation. Article X of the 1987 Constitution. and quo warranto. No. prohibition. or welfare for the benefit of the poor and the landless. [32] SECTION 19. That the local government unit may immediately take possession of the property upon the filing of the expropriation proceedings and upon making a deposit with the proper court of at least fifteen (15%) of the fair market value of the property based on the current tax declaration of the property to be . [31] See Section 10. further. Provided. — The Intermediate Appellate Court shall exercise: (1) Original jurisdiction to issue writs of mandamus. Section 6 of the Local Government Code of 1991.R. Jurisdiction. and such offer was not accepted. habeas corpus.

convey. and exercise all the powers hereinafter conferred. and second priority to laborers and low-salaried employees. That the amount to be paid for the expropriated property shall be determined by the proper court. if necessary. the city may raise necessary funds by appropriations of general funds. The City of Manila is authorized to acquire private lands in the city and to subdivide the same into home lots for sale on easy terms to city residents. contract and be contracted with. Sec. and.A. and dispose of real and personal property for the general interest of the city.expropriated: Provided. For the purpose of this section. finally. . lease. purchase. 409. may acquire the lands through expropriation proceedings in accordance with law. condemn private property for public use. with the approval of the President xxx”. 3). xxx xxx xxx “Sec. *33+ “General powers – The city may have a common seal and alter the same at pleasure. 100.” (R. [34] 284 SCRA 716. by securing loans or by issuing bonds. hold. 731 [1998]. sue and be sued. receive. and may take. based on the fair market value at the time of the taking of the property. and prosecute and defend to final judgment and execution. giving first priority to the bona fide tenants or occupants of said lands.

vs. 152 SCRA 540 [1987]. vs. J. Intermediate Appellate Court. Tropical Homes. Petitioner. Respondent. Inc. 142 SCRA 182 [1986].R. KING AND SONS COMPANY.[35] Ibid. DECISION TINGA. 731-732. vs. 2012 Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G. November 17.. 2009 METROPOLITAN CEBU WATER DISTRICT (MCWD). J.. INC. [36] Filipinas Marble Corp. National Housing Authority. 175983 April 16.: . lawphil Today is Saturday. pp. No.

Before us is a Rule 45 petition1 which seeks the reversal of the decision2 and resolution3 of the Court of Appeals in CA-G.6 Petitioner wanted to acquire a five (5)-square meter lot occupied by its production well. Petitioner initiated negotiations7 with respondent J. 01520049 which was duly approved by the Local Water Utilities Administration (LWUA). improve. maintain and operate water supply and distribution systems within the boundaries of the District. After the negotiations had failed. CEB-SP No.10 On 10 November 2004. Inc. The lot is part of respondent’s property covered by TCT No. Among its purposes are to acquire. Branch 23. Petitioner Metropolitan Cebu Water District is a governmentowned and controlled corporation created pursuant to Presidential Decree No. allowing petitioner to take possession of respondent’s property. for the voluntary sale of the latter’s property. Cebu City. 198. King and Sons Company.R. petitioner . 168605 and located in Banilad. Respondent did not acquiesce to petitioner’s proposal. install. as amended. 00810. The Court of Appeals’ decision nullified the orders4 and the writ of possession5 issued by the Regional Trial Court (RTC) of Cebu City. petitioner pursuant to its charter8 initiated expropriation proceedings through Board Resolution No.

filed a complaint11 to expropriate the five (5)-square meter portion of respondent’s property. On 7 February 2005, petitioner filed a motion12 for the issuance of a writ of possession. Petitioner wanted to tender the amount to respondent during a rescheduled hearing which petitioner’s counsel had failed to attend.13 Petitioner deposited14 with the Clerk of Court the amount of P17,500.00 equivalent to one hundred percent (100%) of the current zonal value of the property which the Bureau of Internal Revenue had pegged at P3,500.00 per square meter.15 Subsequently, the trial court granted the motion16 and issued the writ of possession.17 Respondent moved for reconsideration but the motion was denied.18 Respondent filed a petition19 for certiorari under Rule 65 with the Court of Appeals. It sought the issuance of a temporary restraining order (TRO) which the Court of Appeals granted.20 Thus, petitioner was not able to gain entry to the lot.21 On 26 July 2006, the Court of Appeals rendered the assailed decision22 granting respondent’s petition. It ruled that the board resolution which authorized the filing of the expropriation complaint lacked exactitude and particularity which made it invalid; that there was no genuine necessity for the expropriation of the five (5)-square meter lot and; that the reliance on Republic Act (R.A.) No. 8974 in fixing the value of the property contravenes the judicial determination of just

compensation. Petitioner moved23 for reconsideration but the motion was rejected.24 Hence, this petition. The issues raised by petitioner can be summarized as follows: 1. Whether there was sufficient authority from the petitioner’s board of directors to institute the expropriation complaint; and 2. Whether the procedure in obtaining a writ of possession was properly observed. Eminent domain is the right of the state to acquire private property for public use upon payment of just compensation.25 The power of eminent domain is inseparable in sovereignty being essential to the existence of the State and inherent in government. Its exercise is proscribed by only two Constitutional requirements: first, that there must be just compensation, and second, that no person shall be deprived of life, liberty or property without due process of law26 . As an inherent sovereign prerogative, the power to expropriate pertains to the legislature. However, Congress may, as in fact it often does, delegate the exercise of the power to government agencies, public officials and quasi-public entities. Petitioner is one of the numerous government offices so

empowered. Under its charter, P.D. No. 198, as amended,27 petitioner is explicitly granted the power of eminent domain. On 7 November 2000, Congress enacted R.A. No. 8974, entitled "An Act To Facilitate The Acquisition Of Right-Of-Way, Site Or Location For National Government Infrastructure Projects And For Other Purposes." Section 2 thereof defines national government projects as follows: Sec. 2. National Government Projects.—The term "national government projects" shall refer to all national government infrastructure, engineering works and service contracts, including projects undertaken by government-owned and controlled corporations, all projects covered by Republic Act No. 6957, as amended by Republic Act No. 7718, otherwise known as the Build-Operate-and-Transfer Law, and other related and necessary activities, such as site acquisition, supply and/or installation of equipment and materials, implementation, construction, completion, operation, maintenance, improvement, repair and rehabilitation, regardless of source of funding." (emphasis ours) R.A. No. 8974 includes projects undertaken by government owned and controlled corporations,28 such as petitioner. Moreover, the Implementing Rules and Regulations of R.A. No. 8974 explicitly includes water supply, sewerage, and waste management facilities among the national government projects

covered by the law.29 It is beyond question, therefore, that R.A. No. 8974 applies to the expropriation subject of this case. The Court of Appeals held that the board resolution authorizing the expropriation lacked exactitude and particularity. It described the board resolution as akin to a general warrant in criminal law and as such declared it invalid. Respondent reiterates the same argument in its comment and adds that petitioner’s exercise of the power of eminent domain was not reviewed by the LWUA. A corporation does not have powers beyond those expressly conferred upon it by its enabling law. Petitioner’s charter provides that it has the powers, rights and privileges given to private corporations under existing laws, in addition to the powers granted in it.30 All the powers, privileges, and duties of the district shall be exercised and performed by and through the board and that any executive, administrative or ministerial power may be delegated and redelegated by the board to any of its officers or agents for such purpose.31 Being a corporation, petitioner can exercise its powers only through its board of directors. For petitioner to exercise its power of eminent domain, two requirements should be met, namely: first, its board of directors passed a resolution authorizing the expropriation, and; second, the exercise of the power of eminent domain was subjected to

review by the LWUA. In this case, petitioner’s board of directors approved on 27 February 2004, Board Resolution No. 015200432 authorizing its general manager to file expropriation and other cases. Moreover, the LWUA did review and gave its stamp of approval to the filing of a complaint for the expropriation of respondent’s lot. Specifically, the LWUA through its Administrator, Lorenzo H. Jamora, wrote petitioner’s manager, Armando H. Paredes, a letter dated 28 February 200533 authorizing petitioner to file the expropriation case "against the owner of the five-square meter portion of Lot No. 921-A covered by TCT No. 168805, pursuant to Section 25 of P.D. No. 198, as amended." The letter not only explicitly debunks respondent’s claim that there was no authorization from LWUA but it also identifies the lot sought to be expropriated with sufficient particularity. It is settled that the validity of a complaint may be questioned immediately upon its filing through a motion to dismiss or raised thereafter as an affirmative defense. However, there is no need to further belabor the issue since it is established that petitioner has the legal capacity to institute the expropriation complaint. Anent the second issue involving the issuance of a writ of possession, a discussion on the various stages in an expropriation proceeding is necessary.

The general rule is that upon filing of the expropriation complaint, the plaintiff has the right to take or enter into possession of the real property involved if he deposits with the authorized government depositary an amount equivalent to the assessed value of the property for purposes of taxation. An exception to this procedure is provided by R.A. No. 897434 . It requires the payment of one hundred percent (100%) of the zonal value of the property to be expropriated to entitle the plaintiff to a writ of possession. In an expropriation proceeding there are two stages, first, is the determination of the validity of the expropriation, and second is the determination of just compensation.35 In Tan v. Republic,36 we explained the two (2) stages in an expropriation proceeding to wit: (1) Determination of the authority of the plaintiff to exercise the power of eminent domain and the propriety of its exercise in the context of the facts involved in the suit. It ends with an order, if not of dismissal of the action, with condemnation declaring that the plaintiff has a lawful right to take the property sought to be condemned for the public use or purpose described in the complaint, upon payment of just compensation. An order of expropriation is final. An order of dismissal, if this be ordained, would be a final one, as it finally disposes of the action and leaves nothing more to be done by the courts on the merits. The order of expropriation would also be a final one for after its issuance, no objection to the right of condemnation shall be

heard. The order of expropriation may be appealed by any party aggrieved thereby by filing a record on appeal. (2) Determination by the court of the just compensation for the property sought to be taken with the assistance of not more than three (3) commissioners. The order fixing the just compensation on the basis of the evidence before the court and findings of the commissioners would likewise be a final one, as it would leave nothing more to be done by the court regarding the issue. A second and separate appeal may be taken from this order fixing the just compensation.37 Thus, the determination of the necessity of the expropriation is a justiciable question which can only be resolved during the first stage of an expropriation proceeding. Respondent’s claim that the expropriated property is too small to be considered for public use can only be resolved during that stage. Further, the Court of Appeals ruled that Section 4 of R.A. No. 8974 runs counter to the express mandate of Section 2 of Rule 67.38 It held that the law undermined the principle that the determination of just compensation is a judicial function. However, this Court has already settled the issue. In Republic v. Gingoyon,39 this Court held that: It is the plain intent of Rep. Act No. 8974 to supersede the system of deposit under Rule 67 with the scheme of "immediate

payment" in cases involving national government infrastructure projects. xxx It likewise bears noting that the appropriate standard of just compensation is a substantive matter. It is well within the province of the legislature to fix the standard, which it did through the enactment of Rep. Act No. 8974. Specifically, this prescribes the new standards in determining the amount of just compensation in expropriation cases relating to national government infrastructure projects, as well as the manner of payment thereof. At the same time, Section 14 of the Implementing Rules recognizes the continued applicability of Rule 67 on procedural aspects when it provides "all matters regarding defenses and objections to the complaint, issues on uncertain ownership and conflicting claims, effects of appeal on the rights of the parties, and such other incidents affecting the complaint shall be resolved under the provisions on expropriation of Rule 67 of the Rules of Court.40 R.A. No. 8974 does not take away from the courts the power to judicially determine the amount of just compensation. The law merely sets the minimum price of the property as the provisional value. Thus,

the amount of just compensation must still be determined by the courts according to the standards set forth in Section 541 of R.A. No. 8974. R.A. No. 8974 provides a different scheme for the obtention of a writ of possession. The law does not require a deposit with a government bank; instead it requires the government to immediately pay the property owner.42 The provisional character of this payment means that it is not yet final, yet, sufficient under the law to entitle the Government to the writ of possession over the expropriated property.43 The provisional payment is a prerequisite44 and a trigger45 for the issuance of the writ of possession. In Gingoyon,46 we held that: It is the plain intent of Rep. Act No. 8974 to supersede the system of deposit under Rule 67 with the scheme of "immediate payment" in cases involving national government infrastructure projects.47 xxx Rep. Act. No. 8974 is plainly clear in imposing the requirement of immediate prepayment, and no amount of statutory deconstruction can evade such requisite. It enshrines a new approach towards eminent domain that reconciles the inherent unease attending expropriation proceedings with a position of fundamental equity. While expropriation proceedings have always demanded just compensation in exchange for private

property, the previous deposit requirement impeded immediate compensation to the private owner, especially in cases wherein the determination of the final amount of compensation would prove highly disputed. Under the new modality prescribed by Rep. Act. No. 8974, the private owner sees immediate monetary recompense, with the same degree of speed as the taking of his/her property.481avvphi1 Petitioner was supposed to tender the provisional payment directly to respondent during a hearing which it had failed to attend. Petitioner, then, deposited the provisional payment with the court. The trial court did not commit an error in accepting the deposit and in issuing the writ of possession. The deposit of the provisional amount with the court is equivalent to payment. Indeed, Section 4 of R.A. No. 8974 is emphatic to the effect that "upon compliance with the guidelines…the court shall immediately issue to the implementing agency an order to take possession of the property and start the implementation of the project."49 Under this statutory provision, when the government, its agencies or government-owned and controlled corporations, make the required provisional payment, the trial court has a ministerial duty to issue a writ of possession. In Capitol Steel Corporation v. PHIVIDEC Industrial Authority,50 we held that: Upon compliance with the requirements, a petitioner in an expropriation case…is entitled to a writ of possession as a

matter of right and it becomes the ministerial duty of the trial court to forthwith issue the writ of possession. No hearing is required and the court neither exercises its discretion or judgment in determining the amount of the provisional value of the properties to be expropriated as the legislature has fixed the amount under Section 4 of R.A. No. 8974.51 (emphasis ours) It is mandatory on the trial court’s part to issue the writ of possession and on the sheriff’s part to deliver possession of respondent’s property to petitioner pursuant to the writ. WHEREFORE, the Court of Appeals’ Decision dated 26 July 2006 and Resolution dated 28 September 2006 are REVERSED. The ORDERS of the Regional Trial Court dated 01 April 2005 and 9 May 2005 are hereby REINSTATED. The Regional Trial Court is further DIRECTED to immediately REMIT the amount of P17,500.00 to respondent and to REQUIRE the sheriff to implement the writ of possession. The case is REMANDED to the trial court for further proceedings. SO ORDERED. DANTE O. TINGA Associate Justice WE CONCUR: LEONARDO A. QUISUMBING

Associate Justice Chairperson CONCHITA CARPIO MORALES Associate Justice PRESBITERO J. VELASCO, JR. Associate Justice ARTURO D. BRION Associate Justice ATTESTATION I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division. LEONARDO A. QUISUMBING Associate Justice Chairperson, Second Division CERTIFICATION Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson’s Attestation, it is hereby certified that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division. REYNATO S. PUNO

Chief Justice Footnotes 1 Rollo. pp. 9-23. 2 Id. at 29-36; Dated 26 July 2006; penned by Associate Justice Isaias Dicdican and concurred in by Associate Justices Apolinario Bruselas, Jr. and Agustin S. Dizon. 3 Id. at 49-50; Dated 28 September 2006. 4 Id. at 57-58; Dated 01 April 2005 and 9 May 2005, both penned by Judge Generosa Labra. 5 Id. at 98-100; Dated 21 June 2005 issued by Clerk of Court Jeoffrey Joaquino. 6 P.D. No. 198, Sec. 5. Section 5. Purpose.—Local water districts may be formed pursuant to this Title for the purposes of (a) acquiring, installing, improving, maintaining and operating water supply and distribution systems for domestic, industrial, municipal and agricultural uses for residents and lands within the boundaries of such districts, (b) providing, maintaining and operating wastewater collection, treatment and disposal facilities, and (c) conducting such other functions and operations incidental to

water resource development, utilization and disposal within such districts, as are necessary or incidental to said purpose. 7 Rollo, pp. 112-116. 8 P.D. No. 198, Sec.. 25, as amended. Section 25. Authorization. –The district may exercise all the powers which are expressly granted by this Title or which are necessarily implied from or incidental to the powers and purposes herein stated. For the purpose of carrying out the objectives of this Act, a district is hereby granted the power of eminent domain, the exercise thereof shall, however, be subject to review by the Administration. 9 Rollo, p. 118. 10 Id. at 95; Letter dated 28 February 2005. 11 Id. at 102-106. 12 Records, pp. 49-50. 13 Rollo, p. 40. 14 Id. at 56; Official Receipt No. 5908819 dated 16 March 2005.

15 Id. at 117. 16 Id.a t 57-58; Order dated 1 April 2005. 17 Id. at 98-100. 18 Id. at 97. 19 Id. at 233-278. 20 Id. at 82-83; Dated 28 June 2005. 21 Id. at 44. 22 Supra note 2. 23 Id. at 37-45; Dated 23 August 2006. 24 Supra note 3. 25 1987 Const., Art. III, Sec. 9. Sec. 9—Private property shall not be taken for public use without just compensation. 26 Barangay Sindalan, San Fernando, Pampanga v. Court of Appeals, G.R. No.150640, 22 March 2007, 518 SCRA 649.

27 Supra note 8. 28 Rollo, p. 84. 29 Implementing Rules and Regulation of R.A. No. 8974 (2001). Sec. 2 Definition of Terms— xxx (d) National government projects—based on Section 2 of the Act, refer to all to all national government infrastructure, engineering works, and service contracts, including all projects covered by Republic Act No. 6957, as amended by Republic Act No. 7718, otherwise known as the Build-Operate-Transfer Law x x x these projects shall include, but not limited, to x x x water supply, sewerage and waste management facilities x x x 30 P.D. No. 198, Sec. 6, as amended, Sec. 6. Formation of District.—This Act is the source of authorization and power to form and maintain a district. For purposes of this Act, a district shall be considered as a quasipublic corporation performing public service and supplying public wants. As such, a district shall exercise the powers, rights and privileges given to private corporations under existing laws,

in addition to the powers granted in, and subject to such restrictions imposed, under this Act. xxx 31 P.D. No. 198, Sec. 17, as amended. Sec. 17. Performance of District Powers.–All powers, privileges, and duties of the district shall be exercised and performed by and through the board: Provided, however, that any executive, administrative or ministerial power shall be delegated and redelegated by the board to officers or agents designated for such purpose by the board. 32 Rollo, p. 118. 33 Id. at 95. 34 Infra note 42. 35 Republic v. Phil-Ville Development and Housing Corporation, G.R. No. 172243, 26 June 2007, 525 SCRA 776. 36 Tan v. Republic G.R. No. 170740, 25 May 2007,523 SCRA 203. 37 Id. at 211-212. Citing Municipality of Biñan v. Garcia, G.R. No. 69260, 22 December 1989, 180 SCRA 576; National Power

Corp. v. Jocson, G.R. Nos. 94193-99, 25 February 1992, 206 SCRA 520. See also Lintag v. National Power Corporation, G.R. No. 158609, 27 July 2007, 528 SCRA 287, 297. 38 Rules of Court, Rule 67, Sec. 2. Sec.2 Entry of plaintiff upon depositing value with authorized government depositary.—Upon filing of the complaint or at any time thereafter and after due notice to the defendant, the plaintiff shall have the right to take or enter upon the possession of the real property involved if he deposits with the authorized government depositary an amount equivalent to the assessed value of the property for purposes of taxation to be held by such bank subject to the orders of the court. Such deposit shall be in money, unless in lieu thereof the court authorizes the deposit of a certificate of deposit of a government bank of the Republic of the Philippines payable on demand to the authorized government depositary. If personal property is involved, its value shall be provisionally ascertained and the amount to be deposited shall be promptly fixed by the court. After such deposit is made the court shall order the sheriff or other proper officer to forthwith place the plaintiff in possession of the property involved and promptly submit a report thereof to the court with service of copies to the parties.

39 G.R. No. 166429, 19 December 2005, 478 SCRA 474, 519. 40 Id. at 519-520. Cited in National Power Corporation v. Co, G.R. No. 166973, 10 February 2009. 41 Sec. 5 Standards for the Assessment of the Value of the Land Subject of Expropriation Proceedings or Negotiated Sale.— In order to facilitate the determination of just compensation, the court may consider, among other well-established factors, the following relevant standards: (a) The classification and use for which the property is suited; (b) The developmental costs for improving the land; (c) The value declared by the owners; (d) The current selling price of similar lands in the vicinity; (e) The reasonable disturbance compensation for the removal and/or demolition of certain improvements on the land and for the value of improvements thereon; (f) The size, shape, or location, tax declaration and zonal valuation of the land; (g) The price of the land as manifested in the ocular findings, oral as well as documentary evidence presented; and

(h) Such facts and events as to enable the affected property owners to have sufficient funds to acquire similarly-situated lands of approximate areas as those required from them by the government, and thereby rehabilitate themselves as early as possible. 42 R.A. No. 8974, Sec. 4. Sec. 4. Guidelines for Expropriation Proceedings.—Whenever it is necessary to acquire real property for the right-of-way, site or location for any national government infrastructure project through expropriation, the implementing agency shall initiate the expropriation proceedings before the proper court under the following guidelines: (a) Upon filing of the complaint, and after due notice to the defendant, the implementing agency shall immediately pay the owner of the property the amount equivalent to the sum of (1) one hundred percent (100%) of the value of the property based on the current relevant zonal valuation of the Bureau of Internal Revenue (BIR); and (2) the value of the improvements and/or structures as determined under Section 7 hereof; xxx Upon compliance with the guidelines abovementioned, the court shall immediately issue to the implementing agency an

order to take possession of the property and start the implementation of the project. Before the court can issue a Writ of Possession, the implementing agency shall present to the court a certificate of availability of funds from the proper official concerned. xxx 43 Resolution denying Motion for Reconsideration in Republic v. Gingoyon, G.R. No. 166429, 1 February 2006, 481 SCRA 457, 467. 44 Capitol Steel Corporation v. PHIVIDEC Industrial Authority, G.R. No. 169453, 6 December 2006, 510 SCRA 590, 617. 45 Supra note 43 at 469. 46 G.R. No. 166429, 19 December 2005, 478 SCRA 474, 519. 47 Id. at 519. Cited in National Power Corporation v. Co, G.R. No. 166973, 10 February 2009. 48 Id. at 531-532. 49 Supra note 42. 50 Supra note 44.

51 Id. at 602. The Lawphil Project - Arellano Law Foundation

C. Taking 1. Requisites

lawphil Today is Saturday, November 17, 2012 Republic of the Philippines SUPREME COURT Manila EN BANC

G.R. No. L-20620 August 15, 1974 REPUBLIC OF THE PHILIPPINES, plaintiff-appellant, vs. CARMEN M. VDA. DE CASTELLVI, ET AL., defendantsappellees.

Office of the Solicitor General for plaintiff-appellant. C.A. Mendoza & A. V. Raquiza and Alberto Cacnio & Associates for defendant-appellees.

ZALDIVAR, J.:p Appeal from the decision of the Court of First Instance of Pampanga in its Civil Case No. 1623, an expropriation proceeding. Plaintiff-appellant, the Republic of the Philippines, (hereinafter referred to as the Republic) filed, on June 26, 1959, a complaint for eminent domain against defendantappellee, Carmen M. Vda. de Castellvi, judicial administratrix of the estate of the late Alfonso de Castellvi (hereinafter referred to as Castellvi), over a parcel of land situated in the barrio of San Jose, Floridablanca, Pampanga, described as follows: A parcel of land, Lot No. 199-B Bureau of Lands Plan Swo 23666. Bounded on the NE by Maria Nieves Toledo-Gozun; on the SE by national road; on the SW by AFP reservation, and on the NW by AFP reservation. Containing an area of 759,299 square meters, more or less, and registered in the name of

Bounded on the NE by Lot 3. Containing an area of 88. Bounded on the NE by Lot No. Blk-1. 26254. . 8708 of the Register of Deeds of Pampanga. among other things. more or less. and A parcel of land (Portion of lot 3. Bureau of Lands Plan Psd 26254.273 square meters. that the fair market value of the above-mentioned lands. 13631 of the Register of Pampanga .. on the NW by Lot 1-B. Bureau of Lands Plan Psd. the Republic alleged..772 square meters. and registered in the name of Maria Nieves Toledo Gozun under TCT No. Blk.. Blk-1.. 3. or a total .. was not more than P2.Alfonso Castellvi under TCT No.. according to the Committee on Appraisal for the Province of Pampanga. on the SE by Lot 3.. on the NW by AFP military reservation. and against defendant-appellee Maria Nieves Toledo Gozun (hereinafter referred to as Toledo-Gozun over two parcels of land described as follows: A parcel of land (Portion Lot Blk-1. 8708 of the Register of Deeds of Pampanga. 2 (equivalent to Lot 199-B Swo 23666. on the SE by school lot and national road.000 per hectare. more or less and registered in the name of Maria Nieves Toledo-Gozun under TCT No. In its complaint. Containing an area of 450. on the SW by Lot 1-B. on the SW by Lot 1-B Blk 2 (equivalent to Lot 199-B Swo 23666).. ..

389.669. despite repeated demands. thus causing her damages by way of unrealized profits. plus interest thereon at 6% per annum from July 1. that the court authorizes plaintiff to take immediate possession of the lands upon deposit of that amount with the Provincial Treasurer of Pampanga.669. or that the Republic be ordered to pay her P15. On June 29. among other things. had been.389. had a fair market value of P15.485. illegally occupying her property since July 1.10. 1959. that the land under her administration. thereby preventing her from using and disposing of it. and that the court issues thereafter a final order of condemnation. and the costs of the suit.000.market value of P259. that the Republic. In her "motion to dismiss" filed on July 14. through the Armed Forces of the Philippines.10.485. 1959 the trial court issued an order fixing the provisional value of the lands at P259. so it had a total market value of P11. 1956.10.00 per square meter.669. This defendant prayed that the complaint be dismissed. that the Republic be ordered to pay her P5.00. 1956. particularly the Philippine Air Force. being a residential land.000.00 as unrealized profits. that the provisional value of the lands be fixed at P259. Castellvi alleged. and prayed. . that the court appoints three commissioners to ascertain and report to the court the just compensation for the property sought to be expropriated.00 per square meter. or a total of P11.00.

Jr. dated August. plus interest thereon at the rate of 6% per annum from October 13. the trial court ordered that the Republic be placed in possession of the lands. Paloma Castellvi. 1959. viuda de Gil. . Carmen Castellvi.675.085. 1959.675.303 square meters had already been subdivided into different lots for sale to the general public.00.00 per square meter. 1959.10. was also allowed by the court to intervene as a party defendant. Gozun. that her two parcels of land were residential lands. Dolores G. ToledoGozun alleged.00.000.00. dated October 22.669. Joaquin V. 1959..085. Jose Castellvi and Consuelo Castellvi were allowed to intervene as parties defendants. Subsequently. and attorney's fees in the amount of P50. among other things. Natividad Castellvi de Raquiza. Amparo C.By order of the trial court. so they had a total market value of P8. and the remaining portion had already been set aside for expansion sites of the already completed subdivisions. in fact a portion with an area of 343. The Republic was actually placed in possession of the lands on August 10. 1 In her "motion to dismiss". and she prayed that the complaint be dismissed. or that she be paid the amount of P8. Luis Castellvi. husband of defendant Nieves Toledo Gozun. After the Republic had deposited with the Provincial Treasurer of Pampanga the amount of P259. Diaz. that the fair market value of said lands was P15. Rafael Castellvi.

Felicisimo G. 1960 the trial Court authorized the Provincial Treasurer of Pampanga to pay defendant Castellvi the amount of P151. 1960. On November 4.609. counsel of the Philippine National Bank Branch at Floridablanca. as commissioner for the court. all alleged that the value of the lands sought to be expropriated was at the rate of P15. 3 The trial Court appointed three commissioners: Atty.80 as provisional value of the land under her administration. the trial court authorized the Provincial Treasurer of Pampanga to pay defendant ToledoGozun the sum of P107.Intervenors Jose Castellvi and Consuelo Castellvi in their answer. 1960 the trial Court entered an order of condemnation. In another order of May 16. Lansangan. and also intervenor Joaquin Gozun. Leonardo F. in his motion to dismiss. and Atty. after having qualified themselves. for the defendants. husband of defendant Maria Nieves Toledo-Gozun.00 per square meter.. Pamandanan.859.00 as provisional value of her lands. dated May 27. 1959. 2 On May 16. proceeded to the performance of their duties. Filipino legal counsel at Clark Air Base. . Atty. and ordered said defendant to deposit the amount with the Philippine National Bank under the supervision of the Deputy Clerk of Court. Amadeo Yuzon. for the plaintiff. 1960. Jr. The Commissioners. Clerk of Court. filed on February 11.

On March 15.00 per square meter. on May 26.00 be paid to Toledo-Gozun for improvements found on her land. that legal interest on the compensation.20 per square meter. and that no consequential damages be awarded. taking into account all the foregoing circumstances. who insisted that the fair market value of their lands should be fixed at P15. after several extensions of time. 1961. that an additional P5. they recommended unanimously that the lowest price that should be paid was P10. for both the lands of Castellvi and Toledo-Gozun. and by the Republic. rendered its decision 6 the dispositive portion of which reads as follows: WHEREFORE.1961 the Commissioners submitted their report and recommendation.000. 4 The Commissioners' report was objected to by all the parties in the case — by defendants Castellvi and Toledo-Gozun. had adopted as its memorandum its objections to the report of the Commissioners. the trial court.. which insisted that the price to be paid for the lands should be fixed at P0. 1959. be paid after deducting the amounts already paid to the owners. . and that the lands are titled. computed from August 10. after having determined that the lands sought to be expropriated were residential lands. wherein. 5 After the parties-defendants and intervenors had filed their respective memoranda. and the Republic.00 per square meter.. the rising trend .

such interest to run until full payment is made to said defendant or deposit therefor is made in court. The same rate of interest shall be paid from July 11. 1959 on the total value of the land herein adjudged minus the amount deposited as provisional value.of land values . or P151. on the total value of the said (Castellvi) land as herein adjudged. . All the intervenors having failed to produce evidence in support of their respective interventions.. said interventions are ordered dismissed. 1959 until full payment is made to said defendant or deposit therefor is made in court. 1959 when the provisional value thereof was actually deposited in court. interest at 6% per annum will also be paid by the plaintiff to defendant Castellvi from July 1..80.00) pesos per square meter for the three lots of the defendants subject of this action is fair and just. the court finds that the unanimous recommendation of the commissioners of ten (P10. and the lowered purchasing power of the Philippine peso.859. 1956 when plaintiff commenced its illegal possession of the Castellvi land when the instant action had not yet been commenced to July 10. xxx xxx xxx The plaintiff will pay 6% interest per annum on the total value of the lands of defendant Toledo-Gozun since (sic) the amount deposited as provisional value from August 10. In respect to the defendant Castellvi..

1961.The costs shall be charged to the plaintiff. 1961 and the order of July 12. that the decision was not supported by the evidence. The Republic's record on appeal was finally submitted on December 6. On July 8. The Republic also filed a memorandum in support of its . 1961 the Republic filed a motion for a new trial and/or reconsideration. 1961. On July 17. against which motion defendants Castellvi and Toledo-Gozun filed their respective oppositions. Defendants Castellvi and Toledo-Gozun filed not only a joint opposition to the approval of the Republic's record on appeal. On June 21. on July 17. and that the decision was against the law. her notice of appeal from the decision of the trial court. upon the grounds of newlydiscovered evidence. 1961 when the motion of the Republic for new trial and/or reconsideration was called for hearing. 1961. 1961 the Republic gave notice of its intention to appeal from the decision of May 26. This motion for new trial and/or reconsideration was denied by the court on July 12. Defendant Castellvi also filed. 1961. The Republic filed various ex-parte motions for extension of time within which to file its record on appeal. but also a joint memorandum in support of their opposition. the Republic filed a supplemental motion for new trial upon the ground of additional newlydiscovered evidence.

1962 the Republic filed a "motion to strike out the order of December 27. In her motion of August 11. stating that "in the interest of expediency. In an order dated November 19. against which motion the defendants Castellvi and Toledo-Gozun filed their opposition. On January 11. On December 27. but this Court denied the motion. appellee Castellvi sought to increase the provisional value of her land. 1962 the trial court issued an order. 1962. 1961 the trial court issued an order declaring both the record on appeal filed by the Republic. The motion to dismiss the Republic's appeal was reiterated by appellees Castellvi and Toledo-Gozun before this Court.prayer for the approval of its record on appeal. 1961 and for reconsideration". On July 26." and at the same time it ordered the Solicitor General to submit a record on appeal containing copies of orders and pleadings specified therein. and subsequently an amended record on appeal. thereby dismissing both appeals. and the record on appeal filed by defendant Castellvi as having been filed out of time. 1964. in . The Republic. Defendant Toledo-Gozun did not appeal. Defendant Castellvi did not insist on her appeal. the questions raised may be properly and finally determined by the Supreme Court. the trial court approved the Republic's record on appeal as amended.

1964. praying that they be authorized to mortgage the lands subject of expropriation. stating that as per agreement with the administrator of the estate of Don Alfonso de Castellvi they shall receive by way of attorney's fees. opposed the same. Alberto Cacnio. This Court denied Castellvi's motion in a resolution dated October 2. The motion of appellees. . counsel for the estate of the late Don Alfonso de Castellvi in the expropriation proceedings. 1969. Attys. "the sum equivalent to ten per centum of whatever the court may finally decide as the expropriated price of the property subject matter of the case." --------Before this Court. and Associates. Castellvi and Toledo-Gozun. 1969. filed a notice of attorney's lien. 1972.its comment on Castellvi's motion. In finding the price of P10 per square meter of the lands subject of the instant proceedings as just compensation. was denied by this Court or October 14. the Republic contends that the lower court erred: 1. On February 14. dated October 6.

were indicative of an . subject of expropriation. In denying plaintiff-appellant's motion for new trial based on newly discovered evidence. In its brief. 4. it was stipulated that the fair market value should be as of the time of occupancy. the Republic argues that the "taking" should be reckoned from the year 1947 when by virtue of a special lease agreement between the Republic and appellee Castellvi. and that the permanent improvements amounting to more that half a million pesos constructed during a period of twelve years on the land. In ordering plaintiff-appellant to pay 6% interest on the adjudged value of the Castellvi property to start from July of 1956. In holding that the "taking" of the properties under expropriation commenced with the filing of this action. the Republic discusses the second error assigned as the first issue to be considered. the former was granted the "right and privilege" to buy the property should the lessor wish to terminate the lease. and that in the event of such sale. In support of the assigned error that the lower court erred in holding that the "taking" of the properties under expropriation commenced with the filing of the complaint in this case. We shall follow the sequence of the Republic's discussion. 3. 1.2.

because the Republic was paying the lessor Castellvi a monthly rental of P445. on the other hand. for the contract of lease relied upon provides for a lease from year to year." 8 Appellee Toledo-Gozun did not comment on the Republic's argument in support of the second error assigned. and that the contract of lease does not grant the Republic the "right and privilege" to buy the premises "at the value at the time of occupancy. that the second element is also wanting. 1959.58. 7 Appellee Castellvi. it should be noted that the Castellvi property had been occupied by the Philippine Air Force since 1947 under a . to wit: (1) entrance and occupation by condemn or upon the private property for more than a momentary or limited period. and (2) devoting it to a public use in such a way as to oust the owner and deprive him of all beneficial enjoyment of the property. in so far as the Castellvi property is concerned. because as far as she was concerned the Republic had not taken possession of her lands prior to August 10. maintains that the "taking" of property under the power of eminent domain requires two essential elements. 9 In order to better comprehend the issues raised in the appeal.agreed pattern of permanency and stability of occupancy by the Philippine Air Force in the interest of national Security. This appellee argues that in the instant case the first element is wanting.

WITNESSETH: 1. hereinafter called the LESSOR and THE REPUBLIC OF THE PHILIPPINES represented by MAJ. midiendo una extension superficial de cuatro milliones once mil cuatro cientos trienta y cinco (4. the pertinent portions of which read: CONTRACT OF LEASE This AGREEMENT OF LEASE MADE AND ENTERED into by and between INTESTATE ESTATE OF ALFONSO DE CASTELLVI. mas o menos. Lote No. DE CASTELLVI. 4Castellvi. . For and in consideration of the rentals hereinafter reserved and the mutual terms. Judicial Administratrix .. .. 27 del Plano de subdivision Psu 34752. and by these presents does.. viz: Un Terreno. typified by the contract marked Exh. represented by CARMEN M. parte de la hacienda de Campauit. situado en el Barrio de San Jose. GEN.435) [sic] metros cuadrados. lease and let unto the LESSEE the following described land together with the improvements thereon and appurtenances thereof.contract of lease. the LESSOR has.. Municipio de Floridablanca Pampanga. CALIXTO DUQUE. hereinafter called the LESSEE. Chief of Staff of the ARMED FORCES OF THE PHILIPPINES. covenants and conditions of the parties.001.

1953. The term of this lease shall be for the period beginning July 1. Above lot is more particularly described in TCT No. the LESSEE at its option may proceed to do so at the expense of the LESSOR. AFP until June 30. . The LESSOR hereby warrants that the LESSEE shall have quiet. but should the LESSOR fail to do so. 75. the LESSOR warrants that he/she/they/is/are the registered owner(s) and with full authority to execute a contract of this nature.93 hectares thereof are actually occupied and covered by this contract. any conveyance will be conditioned on the right of the LESSEE hereunder. province of Pampanga . of which premises. 2. peaceful and undisturbed possession of the demised premises throughout the full term or period of this lease and the LESSOR undertakes without cost to the LESSEE to eject all trespassers. The LESSOR further agrees that should he/she/they sell or encumber all or any part of the herein described premises during the period of this lease.. 3.. subject to renewal for another year at the option of the LESSEE or unless sooner terminated by the LESSEE as hereinafter provided.Out of the above described property. 1952 the date the premises were occupied by the PHILIPPINE AIR FORCE. . 1016.

The LESSEE shall pay to the LESSOR as monthly rentals under this lease the sum of FOUR HUNDRED FIFTY-FIVE PESOS & 58/100 (P455.58) . which facilities or fixtures . in lieu of performance of its obligation.4. The LESSEE shall surrender possession of the premises upon the expiration or termination of this lease and if so required by the LESSOR. 5... the LESSEE shall have the right and privilege to compensate the LESSOR at the fair value or the equivalent. that should the LESSOR give notice within the time specified above. if any.... at any time prior to the termination of this lease. to restore the premises. upon or attached to the said premises shall be and remain property of the LESSEE and may be removed therefrom by the LESSEE prior to the termination of this lease. the LESSOR shall give written notice thereof to the LESSEE at least twenty (20) days before the termination of the lease and provided. further. use the property for any purpose or purposes and. that if the LESSOR so requires the return of the premises in such condition. The LESSEE may. Fair value is to be determined as the value at the time of occupancy less fair . reasonable and ordinary wear and tear and damages by the elements or by circumstances over which the LESSEE has no control excepted: PROVIDED. shall return the premises in substantially the same condition as that existing at the time same were first occupied by the AFP.. install facilities and fixtures and errect additions . so placed in. at its own costs and expense make alteration.

III)". 11 It is undisputed. oral or written. with the annual contracts entered into from year to year between defendant Castellvi and the Republic of the Philippines (p. 7.. 10 It was stipulated by the parties. by virtue of the abovementioned contract. previously entered into between the parties covering the property herein leased. Castellvi) is 'similar in terms and conditions. The LESSEE may terminate this lease at any time during the term hereof by giving written notice to the LESSOR at least thirty (30) days in advance . the same having been merged herein. therefore. The LESSEE should not be responsible.. 8. acts of GOD. the elements or other acts and deeds not due to the negligence on the part of the LESSEE. on a year to year basis (from July 1 of . This LEASE AGREEMENT supersedes and voids any and all agreements and undertakings.wear and tear and depreciation during the period of this lease. 6. 4. including the date'.s. t. that the Republic occupied Castellvi's land from July 1.. 1947. 17. except under special legislation for any damages to the premises by reason of combat operations. Vol. that "the foregoing contract of lease (Exh. This AGREEMENT may not be modified or altered except by instrument in writing only duly signed by the parties.n.

AFP. informing the latter that the heirs of the property had decided not to continue leasing the property in question because they had decided to subdivide the land for sale to the general public. in Civil Case No. and that the premises be returned in substantially the same condition as before occupancy (Exh.000. demanding that the property be vacated within 30 days from receipt of the letter. there being no other recourse. A follow-up letter was sent on January 12. demanding the delivery and return of the property within one month from said date (Exh. Castellvi wrote to the Chief of Staff. 6 Castellvi).each year to June 30 of the succeeding year) under the terms and conditions therein stated. 5 — Castellvi). When the AFP refused to vacate the leased premises after the termination of the contract. Defendant Castellvi then brought suit in the Court of First Instance of Pampanga. Chief of Staff.00 that were erected and already established on the property. on July 11. Lieutenant General Alfonso Arellano. 1957. answered the letter of Castellvi. 1957. 1956 the Republic sought to renew the same but Castellvi refused. saying that it was difficult for the army to vacate the premises in view of the permanent installations and other facilities worth almost P500. On January 30. 1458. to eject the . 1956. Before the expiration of the contract of lease on June 30. and that. the acquisition of the property by means of expropriation proceedings would be recommended to the President (Exhibit "7" — Castellvi).

1458. in an order which. the instant case now has become moot and academic and/or by virtue of the agreement signed by plaintiff. as stated earlier in this opinion. the Court of First Instance of Pampanga. 1966 up to 1959 when the Philippine Air Force was placed in possession by virtue of an order of the Court upon depositing the provisional amount as fixed by the Provincial Appraisal Committee with the Provincial Treasurer of Pampanga. in part. the Republic instituted these expropriation proceedings. subject matter of the instant case from June 30. 1959. That because of the above-cited agreement wherein the administratrix decided to get the rent corresponding to the rent from 1956 up to 1959 and considering that this action is one of illegal detainer and/or to recover the possession of said land by virtue of non-payment of rents. While this ejectment case was pending. On November 21. Plaintiff has agreed. dismissed Civil Case No. the Republic was placed in possession of the lands on August 10. as a matter of fact has already signed an agreement with defendants. 1959. she has waived her cause of action in the above-entitled case. and. 2.Philippine Air Force from the land. reads as follows: 1. upon petition of the parties. whereby she has agreed to receive the rent of the lands. 12 The Republic urges that the "taking " of Castellvi's property should be deemed as of the year 1947 by virtue of afore- .

"Momentary" means.quoted lease agreement. and. transitory. In American Jurisprudence. on the subject of "Eminent Domain. we read the definition of "taking" (in eminent domain) as follows: Taking' under the power of eminent domain may be defined generally as entering upon private property for more than a momentary period. "lasting a very short time. having a very brief life. through the AFP. devoting it to a public use. the expropriator must enter a private property. the entrance into private property must be for more than a momentary period. a number of circumstances must be present in the "taking" of property for purposes of eminent domain. page 596). First. Volume VI. Second. took possession of the property of Castellvi. Section 157. This circumstance is present in the instant case. operative or recurring at every moment" (Webster's Third International . when by virtue of the lease agreement the Republic. 2nd edition. or otherwise informally appropriating or injuriously affecting it in such a way as substantially to oust the owner and deprive him of all beneficial enjoyment thereof. 13 Pursuant to the aforecited authority. "lasting but a moment. of but a moment's duration" (The Oxford English Dictionary. under the warrant or color of legal authority. Vol. 26.

Inc. Rizal Park Co.) The word "momentary" when applied to possession or occupancy of (real) property should be construed to mean "a limited period" — not indefinite or permanent. but what is expressed in the language used.. is temporary. The aforecited lease contract was for a period of one year.. as lessee. . and the terms 'of the contract. under the lease. as in the instant case. 348). By express provision of the lease agreement the Republic. as may be inferred from the construction of permanent improvements. their contemporaneous and subsequent acts shall be principally considered (Art. The fact that the Republic. Inc. are conclusive in the absence of averment and proof of mistake or fraud — the question being not what the intention was. undertook to return the premises in substantially the same condition as at the time the property was first occupied by the AFP. and considered transitory. Magdalena Estate. v. when unambiguous. renewable from year to year. although renewable from year to year by consent of 'The owner of the land. The entry on the property. Myrick. 71 Phil. constructed some installations of a permanent nature does not alter the fact that the entry into the land was transitory. 1963 edition. 515. (City of Manila v. Moreover. 53 Phil. But this "intention" cannot prevail over the clear and express terms of the lease contract. 1371. in order to judge the intention of the contracting parties. or intended to last a year. 525). It is claimed that the intention of the lessee was to occupy the land permanently. Intent is to be deduced from the language employed by the parties. 344. through the AFP.Dictionary.

but certainly mere notice . nor bind the land itself. the property must be devoted to a public use or otherwise informally appropriated or injuriously affected. Fourth. and could not.Civil Code).. bind the landowner. for the purpose of converting them into a jet air base? 14 It might really have been the intention of the Republic to expropriate the lands in question at some future time. the entry into the property should be under warrant or color of legal authority. 484). et al.much less an implied notice — of such intention on the part of the Republic to expropriate the lands in the future did not. 461. If the intention of the lessee (Republic) in 1947 was really to occupy permanently Castellvi's property. It may be conceded that the circumstance of the property being devoted to public use is present because the property was used by the air force of the AFP. why was the contract of lease entered into on year to year basis? Why was the lease agreement renewed from year to year? Why did not the Republic expropriate this land of Castellvi in 1949 when. according to the Republic itself. The expropriation must be actually commenced in court (Republic vs. Baylosis. This circumstance in the "taking" may be considered as present in the instant case. 96 Phil. because the Republic entered the Castellvi property as lessee. . Third. it expropriated the other parcels of land that it occupied at the same time as the Castellvi land.

In the instant case. the entry of the Republic into the property and its utilization of the same for public use did not oust Castellvi and deprive her of all beneficial enjoyment of the property. as shown by the renewal of the lease contract from year to year. Castellvi remained as owner. and by the provision in the lease contract whereby the Republic undertook to return the property to Castellvi when the lease was terminated. and (2) that in devoting the property to public use the owner was ousted from the property and deprived of its beneficial . or indefinite period. Neither was Castellvi deprived of all the beneficial enjoyment of the property. because the Republic was bound to pay. It is clear. and was continuously recognized as owner by the Republic. therefore. We find merit in the contention of Castellvi that two essential elements in the "taking" of property under the power of eminent domain. Castellvi the agreed monthly rentals until the time when it filed the complaint for eminent domain on June 26. namely: (1) that the entrance and occupation by the condemnor must be for a permanent.Fifth. the utilization of the property for public use must be in such a way as to oust the owner and deprive him of all beneficial enjoyment of the property. 1959. and had been paying. that the "taking" of Catellvi's property for purposes of eminent domain cannot be considered to have taken place in 1947 when the Republic commenced to occupy the property as lessee thereof.

. or why the Republic should enter into a simulated contract of lease ("under the guise of lease". but as of the time of occupancy" 15 We cannot accept the Republic's contention that a lease on a year to year basis can give rise to a permanent right to occupy. as of the time of purchase. since by express legal provision a lease made for a determinate time. as expressed by counsel for the Republic) when all the time the Republic had the right of eminent domain.use. Neither can it be said that the right of eminent domain may be exercised by simply leasing the premises to be expropriated (Rule 67. ceases upon the day fixed. Nor can it be accepted that the Republic would enter into a contract of lease where its real intention was to buy. without need of a demand (Article 1669. Untenable also is the Republic's contention that although the contract between the parties was one of lease on a year to year basis. as was the lease of Castellvi's land in the instant case." and "the right to buy the property is merged as an integral part of the lease relationship . so much so that the fair market value has been agreed upon. and could expropriate Castellvi's land if it wanted to without resorting to any guise whatsoever. not. Rules of Court). Neither can we see how a right to . were not present when the Republic entered and occupied the Castellvi property in 1947.. Civil Code). Section 1. it was "in reality a more or less permanent right to occupy the premises under the guise of lease with the 'right and privilege' to buy the property should the lessor wish to terminate the lease.

then claim that the "taking" of the property for the purposes of the expropriation be reckoned as of the date when the Government started to occupy the property under the lease. for many good reasons. What was agreed expressly in paragraph No.buy could be merged in a contract of lease in the absence of any agreement between the parties to that effect. had in the meantime increased during the period of the lease. in spite of the fact that the value of the property. To sustain the contention of the Republic is to sanction a practice whereby in order to secure a low price for a land which the government intends to expropriate (or would eventually expropriate) it would first negotiate with the owner of the land to lease the land (for say ten or twenty years) then expropriate the same when the lease is about to terminate. The Republic's claim that it had the "right and privilege" to buy the property at the value that it had at the time when it first occupied the property as lessee nowhere appears in the lease contract. which would have the effect of depriving the owner of the property of its true and fair market value at the time when the expropriation proceedings were actually instituted in court. 5 of the lease agreement was that. should the lessor require the lessee to return the premises in the same condition as at the time the same was first occupied by the AFP. the lessee would have the "right and privilege" (or option) of paying the lessor what it would fairly cost to put . This would be sanctioning what obviously is a deceptive scheme. and then assert that the value of the property being expropriated be reckoned as of the start of the lease.

Such fair value cannot refer to the purchase price. and that the just compensation to be paid for the Castellvi property should not be determined on the basis of the value of the property as of that year. does not refer to the value of the property if bought by the lessee. therefore. 1372. Under Section 4 of Rule 67 of the Rules of Court. It is a rule in the interpretation of contracts that "However general the terms of a contract may be. for purchase was never intended by the parties to the lease contract. mentioned in the lease agreement. 16 the "just compensation" is to be determined as of the date of the . but refers to the cost of restoring the property in the same condition as of the time when the lessee took possession of the property. The lower court did not commit an error when it held that the "taking" of the property under expropriation commenced with the filing of the complaint in this case. that the "taking" of the Castellvi property should not be reckoned as of the year 1947 when the Republic first occupied the same pursuant to the contract of lease. in lieu of the lessee's performance of the undertaking to put the land in said condition. Civil Code).the premises in the same condition as it was at the commencement of the lease. We hold. The "fair value" at the time of occupancy. they shall not be understood to comprehend things that are distinct and cases that are different from those upon which the parties intended to agree" (Art.

on August 10. therefore. April 12. This Court has ruled that when the taking of the property sought to be expropriated coincides with the commencement of the expropriation proceedings. also by authority of the court. by authority of the court. 1959 when the complaint for eminent domain was filed. Regarding the first assigned error — discussed as the second issue — the Republic maintains that. must also be reckoned as of June 26. L-14158. the price of P10. 961-962). therefore. In the instant case. Regarding the two parcels of land of Toledo-Gozun. be reckoned as of June 26. which had never been under lease to the Republic. the date of the filing of the complaint for eminent domain. 1959. on August 10. 1959. 1961. (Republic vs. The "taking" of the Castellvi property for the purposes of determining the just compensation to be paid must.filing of the complaint. 2. or takes place subsequent to the filing of the complaint for eminent domain. 1959. also sought to be expropriated. the Republic was placed in possession of said lands. 1 SCRA 957.00 per square meter fixed by the lower court "is not only exhorbitant but also . The taking of those lands. 1959. even assuming that the value of the expropriated lands is to be determined as of June 26. the just compensation should be determined as of the date of the filing of the complaint. Philippine National Bank. it is undisputed that the Republic was placed in possession of the Castellvi property.

so that any compensation to be awarded on the basis of the plans would be speculative. The Republic's contention is not well taken. Corrales (32 Phil. both Castellvi and Toledo-Gozun maintain that their lands are residential lands with a fair market value of not less than P15. In the case of City of Manila vs. The finding of the lower court is in consonance with the unanimous opinion of the three commissioners who. and declared. The lower court found. We find evidence showing that the lands in question had ceased to be devoted to the production of agricultural crops. 98) this Court laid down basic guidelines in determining the value of the property expropriated for public purposes. On the other hand. that they had become adaptable for residential purposes. declared that the lands are residential lands. and that the appellees had actually taken steps to convert their lands into residential subdivisions even before the Republic filed the complaint for eminent domain. 82. there being no overt acts on the part of the appellees which indicated that the subdivision project had been commenced. contending that the plans of the appellees to convert the lands into subdivision for residential purposes were only on paper.unconscionable. and almost fantastic". The Republic assails the finding that the lands are residential.00 per square meter. This Court said: . that the lands of Castellvi and Toledo-Gozun are residential lands. in their report to the court.

17 The owner may thus show every advantage that his property possesses. viewed not merely with reference to the uses to which it is at the time applied. must be what is the property worth in the market. the owner of the land has the right to its value for the use for which it would bring the most in the market.. or such as may be reasonably expected in the immediate future. we should say that the compensation of the owner is to be estimated by reference to the use for which the property is suitable. 98 U. in order that the price it could be sold for in the market may be satisfactorily determined. (Miss. present and prospective. Exceptional circumstances will modify the most carefully guarded rule. and Rum River Boom Co. that it is practically impossible to formulate a rule to govern its appraisement in all cases. that is to say. Patterson. but with reference to the uses to which it is plainly adapted. but. 403). therefore. 18 The owner may .In determining the value of land appropriated for public purposes. In expropriation proceedings. in such cases. as a general thing. having regard to the existing business or wants of the community. What is it worth from its availability for valuable uses? So many and varied are the circumstances to be taken into account in determining the value of property condemned for public purposes. the same consideration are to be regarded as in a sale of property between private parties.S. vs. The inquiry.

correctly considered. 1956 in her letter to the Chief of Staff of the Armed Forces of the Philippines. among other circumstances. as embodied in their report. 13-Castellvi) We read in its Resolution No. 5-Castellvi) As a matter of fact.also show that the property is suitable for division into village or town lots. The evidence shows that Castellvi broached the idea of subdividing her land into residential lots as early as July 11. 19 The trial court. the layout of the subdivision plan was tentatively approved by the National Planning Commission on September 7. but also by the Provincial Appraisal Committee of the province of Pampanga composed of the Provincial Treasurer. Since 1957 the land has been classified as residential in view of its proximity to the air base and due to the fact that it was not being devoted to agriculture. 10 the following: 3. the Provincial Auditor and the District Engineer. In the minutes of the meeting of the Provincial Appraisal Committee. therefore. . held on May 14. In fact. This finding of the lower court is supported not only by the unanimous opinion of the commissioners. 1959 (Exh. 1956. the proposed subdivision plans of the lands sought to be expropriated in finding that those lands are residential lots. The taxes due on the property have been paid based on its classification as residential land. there is a plan to convert it into a subdivision for residential purposes. (Exh.

paragraphs 1 and 2. noncommission officers.N. 13-Castellvi). (of Floridablanca) the municipal building. As a matter of fact. "It is at the left side of the entrance of the Basa Air Base and bounded on two sides by roads (Exh. and its conversion into a residential subdivision was tentatively approved by the National Planning Commission on July 8. and the Pampanga Sugar Mills are closed by. p. 1959 (Exhs. and the poblacion of Floridablanca (Exhs.S. regarding lot 1-B it had already been surveyed and subdivided. 1958. 13Castellvi). 12-Castellvi). These lands are near the barrio schoolhouse. They are also contiguous to the Basa Air Base. the barrio chapel. the Pampanga Sugar Mills. and are along the road. 68). The location of the Castellvi land justifies its suitability for a residential subdivision. and taxes based on its classification as residential had been paid since then (Exh. As found by the trial court. The lands of Toledo-Gozun adjoin the land of Castellvi. The land of Castellvi had not been devoted to agriculture since 1947 when it was leased to the Philippine Army. no less than 32 man connected with the Philippine Air Force among them commissioned officers. Exh. 5 and 6 Toledo-Gozun)." 20 The lands of Toledo-Gozun (Lot 1-B and Lot 3) are practically of the same condition as the land of Castellvi. In 1957 said land was classified as residential. and enlisted men had requested Mr. The barrio schoolhouse and chapel are also near (T. As early as June. and . 8-Castellvi).(Exh. 1. the poblacion. 3 and 4-Toledo-Gozun).1960. November 23.

The most important issue to be resolved in the present case relates to the question of what is the just compensation that should be paid to the appellees. . the owners of these lands have the right to their value for the use for which they would bring the most in the market at the time the same were taken from them. Joaquin D.20 per square meter. 8. The Republic cites the case of Republic vs. 1959 when the same were taken possession of by the Republic.20 per square meter. were residential lands and were adaptable for use as residential subdivisions. The lands that are sought to be expropriated in the present case being contiguous to the lands involved in the Narciso case. 21 We agree with the findings. Gozun to open a subdivision on their lands in question (Exhs. Narciso. L-6594. as of August 10. Indeed. and the conclusions. 1956. The Republic asserts that the fair market value of the lands of the appellees is P. of the lower court that the lands that are the subject of expropriation in the present case.20 per square meter. 8-A to 8-ZZ-Toledo-Gozun). which were expropriated by the Republic in 1949 and which are now the site of the Basa Air Base. which this Court decided on May 18.Mrs. and to one Donata Montemayor. The Narciso case involved lands that belonged to Castellvi and Toledo-Gozun. In the Narciso case this Court fixed the fair market value at P. et al.. it is the stand of the Republic that the price that should be fixed for the lands now in question should also be at P.

or P. notwithstanding the recommendation of the majority of the Commission on Appraisal — which was adopted by the trial court — that the fair market value of the lands was P3.20 per square meter. that the owners of the land could not be given more than what they had asked. 23 .000. then. In 1959 the land of Castellvi was assessed at P1. and assessed for taxation purposes at around P400. and in 1959 those lands were already classified.00 per hectare. We find that the price of P. This Court said.20 per square meter in the Narciso case was considered the fair market value of the lands as of the year 1949 when the expropriation proceedings were instituted. as fixed by this Court in the Narciso case. when the present proceedings were instituted. We also find that the price of P.We can not sustain the stand of the Republic. might have a fair market value of P.20 per square meter in 1949. it can not be denied that ten years later. like the lands involved in the Narciso case. 22 While the lands involved in the present case. The evidence shows that since 1949 those lands were no longer cultivated as sugar lands.00 per square meter.000. as residential lands. the value of those lands had increased considerably. in 1959.04 per square meter.00 per hectare and that was the price that they asked the court to pay them.00 per hectare. and at that time the lands were classified as sugar lands. and assessed for taxation purposes. was based on the allegation of the defendants (owners) in their answer to the complaint for eminent domain in that case that the price of their lands was P2.

10. 10 of May 14.". .. in its resolution No. 5 of February 15. 5 of the Provincial Appraisal Committee can not be made the basis for fixing the fair market value of the lands of Castellvi and Toledo-Gozun. that the amount fixed as the provisional value of the lands that are being expropriated does not necessarily represent the true and correct value of the land. 1959 (Exhibit 13-Castellvi). and recommended the price of P1. We find that this resolution was made by the Republic the basis in asking the court to fix the provisional value of the lands sought to be expropriated at P259. The value is only "provisional" or "tentative". The records show that this resolution No.50 per square meter. 1957 (Exhibit D).669. The Republic further relied on the certification of the Acting Assistant Provincial Assessor of Pampanga. the appraisal committee stated that "The Committee has observed that the value of the land in this locality has increased since 1957 . therefore. which was approved by the court. 10.The Republic also points out that the Provincial Appraisal Committee of Pampanga.. dated February 8. In that resolution No. It follows. to serve as the basis for the immediate occupancy of the property being expropriated by the condemnor. recommended the sum of P. contrary to the stand of the Republic. 5 was repealed by the same Provincial Committee on Appraisal in its resolution No. that resolution No. however. 24 It must be considered. that.20 per square meter as the fair valuation of the Castellvi property.

the lands in question. this Court has held that the valuation fixed for the purposes of the assessment of the land for taxation purposes can not bind the landowner where the latter did not intervene in fixing it.00 per hectare. The commissioners made their recommendation on the basis of their observation after several ocular inspections of the lands. and that in 1956 the Castellvi land was classified as sugar land and was assessed at P450. and to the year 1956 as far as the land of Castellvi is concerned. to the effect that in 1950 the lands of ToledoGozun were classified partly as sugar land and partly as urban land. in 1957. and that the sugar land was assessed at P. as the evidence shows. recommended to the court that the price of P10. 25 On the other hand. were already classified and assessed for taxation purposes as residential lands. appointed by the court to appraise the lands that were being expropriated. or P.20 per square meter. We can not also consider this certification of the Acting Assistant Provincial Assessor as a basis for fixing the fair market value of the lands of Castellvi and Toledo-Gozun because. of the testimonies of the owners of . the Commissioners. while part of the urban land was assessed at P.00 per square meter would be the fair market value of the lands.045 per square meter. The certification of the assessor refers to the year 1950 as far as the lands of Toledo-Gozun are concerned.1961 (Exhibit K).40 per square meter. of their own personal knowledge of land values in the province of Pampanga.40 per square meter and part at P. Moreover.

The documentary evidence considered by the commissioners consisted of deeds of sale of residential lands in the town of San Fernando and in Angeles City. where the court fixed the price at P18. 1959. 23-Castellvi). the Clark Air Base and the Basa Air Base respectively. As added advantage it may be said that the Basa Air Base land is very near the sugar mill at Del Carmen.. and other witnesses. Pampanga. which were sold at prices ranging from P8. 1531 of the Court of First Instance of Pampanga.00 to P20.00 per square meter (Exhibit 14-Castellvi). entitled Republic vs. 22. 17.. 18. There is a national road fronting them and are situated in a first-class municipality. owned by the Pampanga Sugar Mills. 1531 of this Court and the lands in the present case (Civil Case No.the land. 19. said: . Floridablanca. which was expropriation case filed on January 13.00 per square meter (Exhibits 15. Both Castellvi and Toledo-Gozun testified that the fair market value of their respective land was at P15. because the circumstances and factors involved therein are similar in many respects to the defendants' lands in this case. and of documentary evidence presented by the appellees. Sabina Tablante. the commissioners. The commissioners also considered the decision in Civil Case No. The land in Civil Case No. 20. This expropriation case is specially pointed out. 1623) are both near the air bases. among other things.00 per square meter. In their report. 16. Also just stone's throw away from the same lands is a . 21. involving a parcel of land adjacent to the Clark Air Base in Angeles City. in the province of Pampanga.

The deeds of absolute sale. 1531 are competent evidence. the Commission finds that the lowest price that can be awarded to the lands in question is P10.. The defendants' lands are nearer to the poblacion of Floridablanca then Clark Air Base is nearer (sic) to the poblacion of Angeles. 26 The lower court did not altogether accept the findings of the Commissioners based on the documentary evidence.. several months before the lands in this case were taken by the plaintiffs . These advantages are not found in the case of the Clark Air Base. because they were executed during the year 1959 and before August 10 of the same year. but . it having been filed on January 13.00 per square meter. 1959 and the taking of the land involved therein was ordered by the Court of First Instance of Pampanga on January 15. Pampanga. according to the undersigned commissioners. From the above and considering further that the lowest as well as the highest price per square meter obtainable in the market of Pampanga relative to subdivision lots within its jurisdiction in the year 1959 is very well known by the Commissioners.beautiful vacation spot at Palacol. 1531.. which counts with a natural swimming pool for vacationists on weekends. a sitio of the town of Floridablanca. as well as the land in Civil Case No. 1959. More specifically so the land at Clark Air Base which coincidentally is the subject matter in the complaint in said Civil Case No.

While great weight is attached to the report of the commissioners. as.00) pesos per square meter for the three lots of the defendants subject of this action is fair and just". or where they have disregarded a clear preponderance of evidence. that the lands are titled. that there is a rising trend of land values. the Supreme Court. 326.it considered the documentary evidence as basis for comparison in determining land values. 40 Phil. or where the amount allowed is either palpably inadequate or excessive. where the commissioners have applied illegal principles to the evidence submitted to them. 28 The report of the commissioners of appraisal in condemnation proceedings are not binding. vs. among other circumstances. may change or modify the report of the commissioners by increasing or reducing the amount of the award if the facts of the case so justify. on appeal. In the case of Manila Railroad Co. Caligsihan. yet a court may substitute therefor its estimate of the value of the property as gathered from the record in certain cases. but merely . the lower court took into consideration. 27 In arriving at its conclusion. and the lowered purchasing power of the Philippine peso. this Court said: A court of first instance or. 328. The lower court arrived at the conclusion that "the unanimous recommendation of the commissioners of ten (P10.

We find points that merit serious consideration in the determination of the just compensation that should be paid to Castellvi and Toledo-Gozun for their lands. and form an idea of the value of the lands in Floridablanca with reference to the land values in those two other communities. It should be noted that the commissioners had made ocular inspections of the lands and had considered the nature and similarities of said lands in relation to the lands in other places in the province of Pampanga. The important factor in expropriation proceeding is that the owner is awarded the just compensation for his property. the town of Floridablanca may be considered practically adjacent to San Fernando and Angeles City. as far as the court is concerned. We cannot disregard the observations of the commissioners regarding the circumstances that make the lands in question suited for residential purposes — their location near the Basa Air Base. just like the lands in Angeles City that are near the Clark Air Base. to compare the land values in Floridablanca to the land values in San Fernando and Angeles City. therefore. It is not out of place. 29 In our analysis of the report of the commissioners. and the facilities that obtain because of their nearness to the big sugar central of the Pampanga Sugar mills. and to the flourishing first class town of Floridablanca. It is true that the lands in question are not in the territory of San Fernando and Angeles City. but. like San Fernando and Angeles City. considering the facilities of modern communications. We .advisory in character.

as recommended by the commissioners and adopted by the lower court. among others. and in fixing the price of the lands that are being expropriated the Court arrived at a happy medium between the price as recommended by the commissioners and approved by the court. and the price advocated by the Republic. is quite high. This Court has also taken judicial notice of the fact that the value of the Philippine peso has considerably gone down since the year 1959. while the land of Toledo-Gozun could be sold for from P2. in this case. and the evidence. It is Our considered view that the price of P5.00 to P4.00 per square meter would be a fair valuation of the lands in question and would constitute a just compensation to the owners thereof.00 per square meter.have carefully studied the record. The Court has weighed all the circumstances relating to this expropriations proceedings. 30 Considering that the lands of Castellvi and ToledoGozun are adjoining each other.00 per square meter. that in the year 1959 the land of Castellvi could be sold for from P3.00 per square meter. In arriving at this conclusion We have particularly taken into consideration the resolution of the Provincial Committee on Appraisal of the province of Pampanga informing. and after considering the circumstances attending the lands in question We have arrived at the conclusion that the price of P10.50 to P3. the Court has deemed it proper to fix the same price for all these lands. . and are of the same nature.

1956. 1959. 1956 to July 10. 1956 to July 10. so much so that Castellvi filed an ejectment case against the Republic in the Court of First Instance of Pampanga. after its lease of the land had expired on June 30. What really happened was that the Republic continued to occupy the land of Castellvi after the expiration of its lease on June 30. from July 1. 1956. and because of the institution of the expropriation proceedings the ejectment case was later dismissed. while that ejectment case was pending. the Court of First Instance of Pampanga said: . 31 However. We find merit in this assignment of error. 1956. In the order dismissing the ejectment case. In ordering the Republic to pay 6% interest on the total value of the land of Castellvi from July 1.3. The Republic maintains that the lower court erred when it ordered the Republic to pay Castellvi interest at the rate of 6% per annum on the total amount adjudged as the value of the land of Castellvi. the Republic filed the complaint for eminent domain in the present case and was placed in possession of the land on August 10. The third issue raised by the Republic relates to the payment of interest. 1959 when the Republic was placed in possession of the land pursuant to the writ of possession issued by the court. 1959. 1959. until August 10. the lower court held that the Republic had illegally possessed the land of Castellvi from July 1.

subject matter of the instant case from June 30. 1959. We do not find merit in this assignment of error. . minus the provisional value that was deposited.. 4. whereby she had agreed to receive the rent of the lands. the Republic filed a motion for a new trial. . 1959. 1956 to August 10. should pay Castellvi interest at the rate of 6% per annum on the value of her land. only from July 10. The Republic. 1959 when it deposited in court the provisional value of the land.. she should be considered as having allowed her land to be leased to the Republic until August 10. as a matter of fact has already signed an agreement with defendants. 1956 up to 1959 when the Philippine Air Force was placed in possession by virtue of an order of the Court upon depositing the provisional amount as fixed by the Provincial Appraisal Committee with the Provincial Treasurer of Pampanga. therefore.Plaintiff has agreed. If Castellvi had agreed to receive the rentals from June 30. After the lower court had decided this case on May 26. The fourth error assigned by the Republic relates to the denial by the lower court of its motion for a new trial based on nearly discovered evidence. and she could not at the same time be entitled to the payment of interest during the same period on the amount awarded her as the just compensation of her land. 1961.

by the spouses Evelyn D. the alleged newly discovered evidence were: (1) a deed of sale of some 35. 1701. No. Floridablanca. or P.14 per square meter. situated at Floridablanca. We find that the lower court acted correctly when it denied the motions for a new trial. situated in Barrio Fortuna. it must appear that the . 1959. To warrant the granting of a new trial based on the ground of newly discovered evidence. Aguas. showing that a certain Serafin Francisco had sold to Pablo L.120.00 per hectare (a little less than P.500.supplemented by another motion. Laird in favor of spouses Bienvenido S. 1957 by Jesus Toledo y Mendoza in favor of the Land Tenure Administration.000 square meters with a sugar quota of 100 piculs. Aguas and Josefina Q. for P14. and (2) a deed of absolute sale of a parcel of land having an area of 4. The alleged newly discovered evidence in the motion filed on June 21. both based upon the ground of newly discovered evidence. for P860. 1961.09 per square meter) executed on October 22. Pampanga.00 (or about P.A.101 square meters.21 per square meter) executed in July. including the sugar quota covered by Plantation Audit No.000. covered by P. Narciso a parcel of sugar land having an area of 100.000 square meters of land situated at Floridablanca for P7. In the supplemental motion. Laird and Cornelio G. 161 1345. 1961 was a deed of absolute sale-executed on January 25.

The lower court also concluded that the land sold by the spouses Laird to the spouses Aguas was a sugar land. The lower court. We agree with the trial court. found that the sales made by Serafin Francisco to Pablo Narciso and that made by Jesus Toledo to the Land Tenure Administration were immaterial and irrelevant. while the lands sought to be expropriated in the instant case are residential lands. 32 The lower court correctly ruled that these requisites were not complied with. the evidence would still not warrant the grant of a new trial.evidence was discovered after the trial. that even with the exercise of due diligence. be shown to be similar. the lands must. In eminent domain proceedings. the evidence could not have been discovered and produced at the trial. in a well-reasoned order. among other things. and they cannot be considered newly discovered . in order that evidence as to the sale price of other lands may be admitted in evidence to prove the fair market value of the land sought to be expropriated. because those sales covered sugarlands with sugar quotas. gratia argumenti. that the lands mentioned in those deeds of sale were residential. But even assuming. and that the evidence is of such a nature as to alter the result of the case if admitted. for said evidence could have been discovered and produced at the trial.

It is true that Fiscal Lagman went to the Office of the Register of Deeds to check conveyances which may be presented in the evidence in this case as it is now sought to be done by virtue of the motions at bar. the trial court said: The Court will now show that there was no reasonable diligence employed. Fiscal Lagman. did not exercise reasonable diligence as required by the rules. The assertion that he only went to the office of the Register of Deeds 'now and then' to check the records in that office only shows the half-hazard [sic] manner by which the plaintiff looked for evidence to be presented during the hearing before the Commissioners. It would have been the easiest matter for plaintiff to move for the issuance of a subpoena duces tecum directing the Register of Deeds of Pampanga to come to testify and to bring with him all documents found in his office .evidence as contemplated in Section 1(b) of Rule 37 of the Rules of Court. There is no question in the mind of the court but this document passed through the Office of the Register of Deeds for the purpose of transferring the title or annotating the sale on the certificate of title. copy of which is attached to the original motion. Regarding this point. if it is at all true that Fiscal Lagman did what he is supposed to have done according to Solicitor Padua. The land described in the deed of sale executed by Serafin Francisco. is covered by a Certificate of Title issued by the Office of the Register of Deeds of Pampanga. one of the lawyers of the plaintiff.

the Office of the Clerk of Court as a part of notarial reports of notaries public that acknowledged these documents. For the same reason they could have been easily discovered if reasonable diligence has been exerted by the numerous lawyers of the plaintiff in this case. The same can be said of the deeds of sale attached to the supplementary motion. They refer to lands covered by certificate of title issued by the Register of Deeds of Pampanga.pertaining to sales of land in Floridablanca adjacent to or near the lands in question executed or recorded from 1958 to the present. namely. or in the archives of the National Library. another government entity. Any lawyer with a modicum of ability handling this expropriation case would have right away though [sic] of digging up documents diligently showing conveyances of lands near or around the parcels of land sought to be expropriated in this case in the offices that would have naturally come to his mind such as the offices mentioned above. Even this elementary precaution was not done by plaintiff's numerous attorneys. It is noteworthy that all these deeds of sale could be found in several government offices. in the Office of the Register of Deeds of Pampanga. and had counsel for the movant really exercised the reasonable diligence required by the Rule' undoubtedly they would have been able to find . the Office of the Provincial Assessor of Pampanga. In respect to Annex 'B' of the supplementary motion copy of the document could also be found in the Office of the Land Tenure Administration.

these documents and/or caused the issuance of subpoena duces tecum... Now. Forgotten however. This was before the decision was rendered. 1961 or more than one month after Solicitor Padua made the above observation. He forgot to present the evidence at a more propitious time. Unfortunately the Court cannot classify it as newly-discovered evidence. 33 The granting or denial of a motion for new trial is. as a general rule.20 which is contiguous to this land. Your Honor. The Court gave him permission to submit said document subject to the approval of the Court. It is also recalled that during the hearing before the Court of the Report and Recommendation of the Commissioners and objection thereto. . the correct qualification that can be given is 'forgotten evidence'. whose . checked up the alleged sale and moved for a reopening to adduce further evidence. .. he seeks to introduce said evidence under the guise of newly-discovered evidence. and later promulgated on May 26. Solicitor Padua made the observation: I understand. He did not do so. He could have. because tinder the circumstances. is not newly-discovered evidence. discretionary with the trial court. that there was a sale that took place in this place of land recently where the land was sold for P0. therefore..

00 as the just compensation for her two parcels of land that have a total area of 539. de Castellvi and Maria Nieves Toledo-Gozun.045 square meters. (d) the Republic must pay appellee Toledo-Gozun the sum of P2. as follows: (a) the lands of appellees Carmen Vda. (b) the fair market value of the lands of the appellees is fixed at P5. WHEREFORE.695.809. the decision appealed from is modified.00 per square meter. minus the sum of P107.859.495.80 that she withdrew out of the amount that was deposited in court as the provisional value of the land.225. (c) the Republic must pay appellee Castellvi the sum of P3. minus the sum of P151. with interest at the rate of 6% per annum from July 10. as described in the complaint. are declared expropriated for public use.00 that she withdrew out of the amount that was deposited in court as the provisional value .796. 1959 until the day full payment is made or deposited in court.judgment should not be disturbed unless there is a clear showing of abuse of discretion.00 as just compensation for her one parcel of land that has an area of 759. 34 We do not see any abuse of discretion on the part of the lower court when it denied the motions for a new trial.299 square meters.

C. pp. 3 Record on Appeal. per annum from July 10.J. 2 Record on Appeal. I. JJ. Vol. Castro. (e) the attorney's lien of Atty. I. concur. 4 Record on Appeal. pp. pp. Esguerra. Rule 141. Muñoz Palma and Aquino. Teehankee and Makasiar. 235-261. JJ. and in Section 13.of her lands. Vol. 121-124. Antonio. IT IS SO ORDERED. of the Rules of Court. 53-56. and (f) the costs should be paid by appellant Republic of the Philippines. Vol. Fernandez. took no part. Fernando. . Alberto Cacnio is enforced.. Rule 67. Barredo.. 53-56. I. as provided in Section 12. 1959 until the day full payment is made or deposited in court. I. Footnotes 1 Record on Appeal. with interest at the rate of 6%. Makalintal. pp.. Vol.

18-30. 6. 18 of its brief. I. Carolina Virginia Estate Corp.. 284-297 and 297299. II. Vol. vs. unlike the land of Castellvi. p. pp. 10 Appellant's brief.5 Record on Appeal. Vol. pp. 7 Appellant's brief. . 57 SE 2d 817. 14 See Appellant's brief. 12. 57 SE 2d 817. 13 Among the cases cited under this Section is that of Penn. citing the case of Penn. pp. pp. pp. 6 Record on Appeal. 387-456. Vol. were never leased to the Republic. pp. 21-26. vs. 7-9. 6-12. 12 Record on Appeal. We find that the lands of Toledo-Gozun. 462-463. which is cited by the Republic on p. 264-270. 11 Appellant's brief. 9 Appellee Toledo-Gozun's brief. p. I. Carolina Virginia Coastal Corporation. pp. 8 Appellee Castellvi's brief. The issue raised in the second error assigned should really refer only to the land of Castellvi.

49 Ark. 406 Pa. 17 SCRA 322. 19 27 Am.. 21 Decision of the lower court. 419. Ry. Vol. 381. Commonwealth.. 18 Little Rock Junction Ry. 16 Similar to Section 5. Jur.W. 32 Minn. 331. May 30. p. 24 Page 10-16. Rothnam vs. See also Republic vs. Wichita Falls and N. vs. . Vol. et al. 701. Co. 28 Okla. 23 See page 471. Vol. 17 King vs. vs. Holloman. Venturanza. 224. Exhibit H for the Republic. 376. Record on Appeal. 5 SW 792. and page 41.1966. 22 Decision in the Narciso case. Record on Appeal. 114 P 700. 22. 20 Decision of the lower court pp. II. Rule 69 of the old Rules of Court.15 See Appellant's brief. 2d pp. 444-445. 446-449. I. pp. I. Record on Appeal. Vol. L-20417. 344-345. Record on Appeal. the rule in force when the complaint in this case was filed. Appellant's Brief. I. Mineapolis Union Railway Co. Woodruff.

Record on Appeal..735 to one U. Estrada. 92 Phil.S. Urtula. The Lawphil Project .S. Vol. 286: and City of Manila vs. Philippine currency. 262-264.00). 32 Phil. 1548. Legaspi. 25 Phil. 32 Sec. dollar ($1.Arellano Law Foundation . Vol. pp. 208. 454. was equal to one U. Velasquez. 28 See also Manila Railroad Company vs. 669.25 Republic of the Philippines vs. 27 Lower court's decision. 607-613. 33 Record on Appeal.00). 1974. 293-294. 14 SCRA 666. Vol. 29 City of Cebu vs. 26 Record on Appeal. 110 Phil. 31 Civil Case No. Ledesma. I. 1 (b) of Rule 37 of the Rules of Court. dollar ($1. 34 Miranda vs. et al. 11. pages 257-260. the Philippine National Bank announced that the inter-bank guiding rate was P6. I. p.00). 30 In 1959 the money value of two pesos (P2. 290. As published in the "Daily Express" of August 6.

INC. No. February 26. SYLLABUS CIVIL LAW. furnitures. etc. can be brought for arbitration expressly provided for in the contract it entered into with petitioner National Power Corporation (NPC).R.THIRD DIVISION [G. and all other expenses as are inherent in a CostPlus and Percentage Contract and necessary for the . 107631. The contract is of a “Cost-Plus a Percentage” type -meaning. respondents. INC.The sole query here is whether or not the two (2) claims from a total of four (4. 1996] NATIONAL POWER CORPORATION. CONTRACTS. vs. (Formerly Pacific Equipment Corp. And what constitutes “Actual Final Cost” is “the total cost to NPC of all the work performed by PECORP which includes cost of materials and supplies. . PECORP will be paid a certain percentage as fee based on the “Actual Final Cost” of the work. petitioner. CLAIMS OF PECORP FROM NPC CAN BE BROUGHT FOR ARBITRATION AS PER CONTRACT. HON. “COST-PLUS A PERCENTAGE” BASED ON “ACTUAL FINAL COST”. charges. structures.). COURT OF APPEALS and PECORP.) presented by private respondent PECORP.

The NPC-GROGUN drilling and grouting contract. pushed through. as merely prayed for by PECORP in its complaint. PECORP filed an action to compel NPC to confirm all the four (4) claims for arbitration.” The rift arose when NPC communicated to PECORP that it was inclined to contract directly and separately with Philippine Grouting and Guniting Co.. a board of arbitrators was convened. As a result of such purported “withdrawal. PECORP made known to NPC its desire to bring the matter to arbitration. PECORP will not be entitled to any fees for said task. Indeed. under Article VI of their contract. As NPC was uncompromising. together with the . When PECORP presented to NPC four (4) claims.prosecution of the work that are approved by NPC x x x. PECORP’s two subject claims (1 and 2).” the drilling and grouting work ceased to be a part of the NPC-PECORP contract. Judgment was rendered in favor of PECORP. But it appeared that NPC was willing to arbitrate on claims (3) and (4) only NPC resisted claim and argued that PECORP withdrew claim (2) from arbitration. Contending that such arrangement will violate its rights under the NPC-PECORP contract. Inc (GROGUN) for the drilling and grouting work on the construction project and consequently. suffices in resolving the immediate conflict between NPC and PECORP. The trial court’s short raison d’ etre for its order that all four (4) claims of PECORP against NPC be arbitrated upon by the arbitration board constituted by them. nonetheless. PECORP manifested its objection to the NPC-GROGUN contract insofar as it deprives PECORP of fees on drilling and grouting.

there would have been no dispute between NPC and PECORP that precipitated the suit for arbitration. DECISION FRANCISCO. Fee on the minimum guaranteed equipment rental which is ten percent (10%) of the Actual Final Cost of P 1. would be inexistent in the first place.67 million . had there been no NPC-PECORP contract. directly and exclusively emanate from what PECORP firmly believes as contractually due it under the NPC-PECORP “Cost-Plus a Percentage” contract. Conversely therefore. as PECORP’s claims for fees. J.other two undisputed claims (3 and 4). APPEARANCES OF COUNSEL The Solicitor General for petitioner. Arturo D.50 . Fee on the cost of drilling and grouting which is ten percent (10%) of the Actual Final Cost of P6.251.962.P 167. in such instance. Valar for private respondent.P696.000.00 .95 2.: The sole query here is whether or not the following two (2) claims 1.519.

from a total of four (4) presented by herein private respondent PECORP. furnitures.” The rift arose when NPC. And what constitutes “Actual Final Cost” has been aptly simplified by the trial court as “the total cost to the defendant (NPC) of all the work performed by the plaintiff (PECORP) which includes cost of materials and supplies.meaning. structures. That contract forged between the government through the NPC and PECORP as party-CONTRACTOR on June 27. charges. 1974. 1 and appurtenant structures of the water supply system of the Bataan Export Processing Zone at Mariveles. and all other expenses as are inherent in a Cost-Plus and Percentage Contract and necessary for the prosecution of the work that are approved by the defendant x x x. Bataan. INC. communicated to PECORP that it was inclined to contract directly and separately with Philippine Grouting and Guniting . PECORP will be paid a certain percentage as fee based on the “Actual Final Cost” of the work. (PECORP for brevity). can be brought for arbitration expressly provided for in the contract it entered into with herein petitioner National Power Corporation (NPC). 1974 was for the construction of the Mariveles Dam No. in a letter dated July 11. etc. It was agreed upon that the contract is of a “Cost-Plus a Percentage” type .

an Arbitration Board shall be formed in the following manner: CORPORATION and CONTRACTOR shall each appoint one (1) member of this board and these members shall appoint a third member who shall act as chairman. .Co. under Article VI of their contract. 1974. pushed through on August 23. When formal arbitration is requested.. nonetheless.” The NPC-GROGUN drilling and grouting contract. controversy. Contending that such NPC-GROGUN arrangement will violate its rights under the NPC-PECORP contract. the matter shall be submitted to arbitration at the choice of either party upon written demand to the other party. (GROGUN) for the drilling and grouting work on the construction project and consequently. NPC tendered the following justifications for its execution: 1. or differences between the parties arising out of this contract that cannot be resolved by them to their mutual satisfaction. which reads: “Should there occur any dispute. PECORP made known to NPC its desire to bring the matter to arbitration. The drilling and grouting work equipment were not included in the equipment availability schedules made jointly by NPC and PECORP at the start of the work. Inc. PECORP will not be entitled to any fees for said task.

3. 4.” the drilling and grouting work ceased to be a part of the NPC-PECORP contract and therefore. 1974. PECORP failed to provide and/or rent equipment for the work and NPC could not immediately provide the equipments. and the usefulness which the owner may obtain therefrom.2. work. Article 1725 reads: “The owner may withdraw at will from the construction of the work. 1974 up to the date of NPC’s letter to PECORP which was July 11. . NPC was availing of its alleged statutory right under Article 1725 of the Civil Code in removing the drilling and grouting work from the scope of its contract with PECORP (NPCPECORP contract). The work could not suffer any further delay. although it may have been commenced. 5. PECORP had not performed any drilling and grouting work. GROGUN had all the equipments and personnel required for the work. considering that from the execution of the NPC-PECORP contract on June 27. and damages. indemnifying the contractor for all the latter’s expenses.” As a result of such purported “withdrawal.

complete. the cost of drilling and grouting work under the NPC-GROGUN contract is a direct cost to NPC and thus cannot be included in the “Actual Final Cost” under the NPC-PECORP contract on which PECORP’s fees are based. Besides. to undertake the construction. 2. 1. as expressed in Article II of the NPC-PECORP contract. PECORP was expressly allowed under the NPC-PECORP contract to sub-contract labor. PECORP is still entitled to the fees considering that the NPC-GROGUN contract would involve identical undertaking and party as . PECORP in fact intended to do just that. apparently in order to discharge fully its contractual duty. supplies and/or services. and b) precludes NPC from collecting fees for said work.a) is not an arbitrable matter thereunder. Drilling and grouting work is but a part of its over-all contractual duty. when even prior to the NPC’s letter of July 11. PECORP’s objection to the NPC-GROGUN contract insofar as it deprives PECORP of fees on drilling and grouting is essentially anchored on the following: 1. PECORP sought authorization from NPC to sub-contract the very same drilling and grouting work to the very same GROGUN in the proposed NPCGROGUN contract. of the Mariveles Dam No. And even if the proposed PECORPGROGUN sub-contract was turned down by NPC. 1974.

A board of arbitrators was thereafter convened. NPC and PECORP.93.that in the rejected sub-contract.95 coupled with a request for arbitration. PECORP on June 14. Roughly five (5) years after. 1979 presented to NPC four (4) claims . not to mention that it was PECORP which actually supervised the drilling and grouting work conducted by GROGUN. As to claim (2) (fee on the minimum guaranteed equipment rental).two of which are the subject claims mentioned at the beginning of this opinion and the other two are: 3. Reimbursement of Medical Hospital expenses re: TK-001 Accident case P50. P 155. NPC argued that PECORP withdrew this claim from . NPC resisted claim (1) (fee for drilling and grouting work) on grounds previously discussed.844. But after a series of written communications among the board. Fee on the inventory of unused stocks and POL 4. it appeared that NPC was willing to arbitrate on claims (3) and (4) only.085.

58 shall be favorably adjudicated and endorsed. The defendant to submit and/or confirm and certify the four (4) claims for arbitration. We understand however that the rest of the claims. where judgment was thereafter rendered in favor of PECORP.” As NPC was uncompromising.182. 2. The Board of Administrators (sic) to reconvene and to arbitrate.arbitration. in the sum of P902. whereby we are withdrawing our claim for fee on the guaranteed equipment rental hours for P167. PECORP filed an action in the Regional Trial Court of Manila to compel NPC to submit/confirm/certify all the four (4) claims for arbitration. ordering: 1. . 1 Project. as per PECORP’s letter to NPC dated May 19.00 in as much as this is an imputed cost and not direct cost as the rest of the claims.000. INC. 1980 which reads in full: “We confirm our agreement earlier pertaining to our claim for payment for contractor’s fee in connection with the construction of the EPZA Dam No. the dispositive portion of which reads: “IN VIEW OF ALL THE FOREGOING. and against National Power Corporation. the four (4) claims of the plaintiff against the defendant. judgment is hereby rendered in favor of the plaintiff PECORP.

” After the trial court denied NPC’s motion for reconsideration of its decision. on appeal. 5. respondent CA went further in disposing of issues which could have been appropriately ventilated and passed upon in the arbitration proceedings . The defendant to pay the costs of suit. affirmed the same but deleted the award of attorney’s fees. 4.3. and .” that respondent CA make: 1. in affirming said decision which merely ordered NPC and PECORP to arbitrate on all four (4) claims.00 as and for attorney’s fees.a course of action apparently prompted by PECORP’s request as contained in its “Motion For Early Resolution” and reiterated in a “Reiteration Motion For Early Resolution.000. The counterclaim is hereby dismissed for lack of merit. The parties to shoulder equally the expenses for arbitration. and 6. However. respondent Court of Appeals. The defendant to pay the plaintiff the amount of P 10. a definitive ruling on whether or not the withdrawal by NPC from PECORP of the drilling and grouting work in favor of GROGUN is a valid withdrawal of work under Article 1725 of the Civil Code.

CONTRACTOR shall fully and faithfully furnish all labor. the NPC-Pecorp Contract is for the construction. 2) in this wise: As to claim no. in its now-assailed judgment. of the Mariveles Dam No. DELAYS AND EXTENSION OF TIME.2. complete. 1. Drilling and grouting work is just a part of the complete construction of the total project. covered by and within the scope of the NPC-Pecorp Contract. 1) and on the minimum guaranteed equipment rental hours (claim no. . II of the contract executed between appellee and appellant provides: ‘SCOPE OF WORK AND COMPLETION. respondent CA resolved PECORP’s claims for fees for drilling and grouting work (claim no. all works required for the Project. complete. Thus. – For and in consideration of the payment or payments to be made by CORPORATION in accordance with the provisions of this contract. I above. 1: “Art.’ “Under the above-quoted provision. in accordance with the terms and conditions of all the documents mentioned under Art. an outright resolution of PECORP’s claims against NPC. plant and materials and construct. in order to obviate further prolonged proceedings or multiplicity of suits. hence.

“The word ‘Project’ is defined in the contract to mean the Dam and Appurtenant Structures. which is the drilling and grouting work. indemnifying the contractor for all the latter’s expenses. 1725 of the Civil Code is not applicable in the instant case. 1725 of the Civil Code to justify its claim that drilling and grouting is not included within the scope of the NPC-Grogun Contract with appellee. 1725 reads: ‘The owner may withdraw at will from the construction of the work. .’ but only a transfer of a part of the construction. “Art. work and the usefulness which the owner may obtain therefrom. “Appellant invokes Art. although it may have been commenced. Drilling and Grouting is part of the dam or appurtenant structures. b) said drilling and grouting still forms part of the project as a mere NPC-Grogun sub-contract. and therefore a part of PECORP’s scope of work. and damages. for the following reasons: a) there was actually no withdrawal from the ‘construction of the work.’ “Art.

’ “The above-quoted letter states that appellee was withdrawing its claim for fees in the minimum guaranteed . 1 Project. 1980). We understand however. 1980 (Annex “2”). “The contention is likewise without merit. written by appellee to appellant partly reads: ‘We confirm our agreement earlier pertaining to our claim for payment of contractor’s fees in connection with the construction of the EPZA Dam No. the claim for the minimum guaranteed equipment rentals hours for P167.” As to claim no. the same is not covered by arbitration. inasmuch as this is an imputed cost and not a direct cost of the rest of the claims.56 shall be favorably adjudicated and endorsed.182. that the rest of the claims. whereby we are withdrawing our claim for fee on the minimum guaranteed equipment rental hours of P167. “The letter dated May 19. therefore. in the sum of P902. appellant contends that since plaintiff-appellee had previously withdrawn (through its letter dated May 19.00.“Since the NPC-Grogun Contract did not amend nor nullify the ‘cost plus’ provision of the NPC-Pecorp Contract.00.000. 2: “x x x.000. appellee Pecorp is still entitled to the said 10% fee.

and Grouting Work. amounting to P902. II Respondent court of appeals erred in not holding that private respondent’s claim for a fee on the minimum guaranteed equipment rental hours in the amount of P167.182. endorsement and approval of all the three (3) other claims. “Thus.000.58.” And from this second adverse judgment. However. NPC refused to certify for arbitration all the said three (3) other claims.00.000.00 is not subject to arbitration since said claim had been previously withdrawn from arbitration by private respondent.equipment rental hours for P 167. the withdrawal was rendered null and void. NPC filed the instant petition raising the following errors: I Respondent court of appeals gravely erred in affirming the trial court’s judgment with respect to the issue of private respondent’s right to claim percentage fee from the NPCGROGUN Contract for Drilling. hence. as the record shows. it is clear that withdrawal is only a proposal conditioned upon NPC’s adjudication. . only upon the condition that NPC will favorably adjudicate and endorse the three other PECORP claims.

directly and exclusively emanate from what PECORP firmly believes as contractually due it under the NPC-PECORP “Cost-Plus a Percentage” contract. together with the other two undisputed claims (3 and 4). Conversely therefore. in such instance. PECORP’s two subject claims (1 and 2).The petition must fail. would be inexistent in the first place. there would have been no dispute between NPC and PECORP that precipitated the suit for arbitration. We thus quote with approval the trial court’s findings and conclusion. suffices in resolving the immediate conflict between NPC and PECORP. or differences between the parties arising out of this contract that cannot be . that: “The contract between the parties specifically provides as follows: ‘ARTICLE VI ARBITRATION Should there occur any dispute controversy. had there been no NPC-PECORP contract. as merely prayed for by PECORP in its complaint. The trial court’s short raison d’ etre for its order that all four (4) claims of PECORP against NPC be arbitrated upon by the arbitration board constituted by them. as PECORP’s claims for fees. Indeed.

Thus. Now Civil Codes *sic+).resolved by them to their mutual satisfaction. the matter shall be submitted for arbitration at the choice of either party upon written demand to the other party. x x x (Italics supplied for emphasis).” . 2039 and 2040 (Art. arbitrable.’ ‘An agreement to arbitrate is a contract. thus – ’Any stipulation that the arbitrators’ award or decision shall be final is valid. controversy and differences between the parties and without qualification as to the nature of the dispute or controversy or differences. When formal arbitration is requested. without prejudice to Articles 2036. enforceable and not contrary to public policy. an Arbitration Board shall be formed in the following manner: CORPORATION and CONTRACTOR shall each appoint one (1) member of this Board and these members shall appoint a third member who shall act as Chairman. “Philippine Law and Jurisprudence recognize arbitration agreements as valid. having arisen from the contract. 2d 11). binding. (5 AM. therefore. JUR.’ “It will be noted that the above-quoted provision mentions any dispute. the relation of the parties is contractual and the rights and liabilities of the parties are controlled by the law of contracts. 200044. the four (4) claims are.

. 2. SO ORDERED. Davide. Narvasa. and why PECORP cannot be deemed to have abandoned or withdrawn its claim for fees on the minimum guaranteed equipment rental against NPC. 2012 .J. Jr. November 17. C. What may be taken Cases lawphil Today is Saturday.The Court likewise accords the same approval to respondent CA’s brief and straight to the point disquisitions (as quoted earlier) on why NPC cannot validly invoke Article 1725 of the Civil Code to prevent PECORP from collecting fees for drilling and grouting work conducted by GROGUN under the NPCGROGUN contract. and Panganiban. (Chairman). and respondent CA’s assailed decision is AFFIRMED. JJ. WHEREFORE. concur. Melo.. the petition for review is hereby DENIED. Said judgment deserves full affirmance without further elaboration.

MISERICORDIA GUTIERREZ and RICARDO MALIT and THE HONORABLE COURT OF APPEALS.R. petitioner. L-60077 January 18. 54291-R entitled "National Power Corporation v. Dabu for private respondents. Misericordia Gutierrez and Ricardo Malit". BIDIN. No. Sps. 1991 NATIONAL POWER CORPORATION. SPS. 1972 Decision of the then Court of .:p This is a petition for review on certiorari filed by the National Power Corporation (NPC) seeking the reversal or modification of the March 9. Pedro S. 1986 Decision of the Court of Appeals in CA G. J. No. affirming the December 4.R.Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G. respondents. vs.

a government owned and controlled entity. said corporation was constrained to file eminent domain proceedings against the herein defendants on January 20.First Instance of Pampanga. in accordance with Commonwealth Act No. 4281 and 7582. Heirs of Natalia Paule and spouses Misericordia Gutierrez and Ricardo Malit covered by tax declarations Nos. Matias Cruz. operation. and maintenance of electric transmission lines for distribution throughout the Philippines. as found by the Court of Appeals. 1965. Fifth Judicial District. is invested with the power of eminent domain for the purpose of pursuing its objectives. are as follows: Plaintiff National Power Corporation. plaintiff corporation deposited the amount of P973. entitled National Power Corporation v. Upon filing of the corresponding complaint. which among others is the construction. 907. For the construction of its 230 KV Mexico-Limay transmission lines. Plaintiff initiated negotiations for the acquisition of right of way easements over the aforementioned lots for the construction of its transmission lines but unsuccessful in this regard. 120. respectively. et al. Branch II. plaintiff's lines have to pass the lands belonging to defendants Matias Cruz. 2709.00 with the . in Civil Case No. The undisputed facts of the case.

the case of defendant Heirs of Natalia Paule was amicably settled by virtue of a Right of Way Grant (Exh.Provincial Treasurer of Pampanga. comprised of one representative of the plaintiff. prepare their appraisals as to the fair and just compensation to be paid to the owners of the lots. one for the defendants and the other from the court. And by virtue of which.00. Hearings were consequently held before said commissioners and during their hearings. The only controversy existing between the parties litigants is the reasonableness and adequacy of the disturbance or compensation fee of the expropriated properties. for the purpose of determining the fair and just compensation due the defendants. tendered to cover the provisional value of the land of the defendant spouses Ricardo Malit and Misericordia Gutierrez. the court appointed three commissioners. and thereafter. C) executed by Guadalupe Sangalang for herself and in behalf of her co-heirs in favor of the plaintiff corporation. by the trial court's order of September 30. the plaintiff corporation was placed in possession of the property of the defendant spouses so it could immediately proceed with the construction of its MexicoLimay 230 KV transmission line. who then were empowered to receive evidence. In this connection. Meanwhile. The case against Matias . 1965. the defendant spouses were authorized to withdraw the fixed provisional value of their land in the sum of P973. conduct ocular inspection of the premises.

The commissioner for the plaintiff corporation recommended the following: .Cruz was earlier decided by the court. . that Mr. .00' (Annex K) The Court's commissioner recommended the following: . . that plaintiff be granted right of way easement over the 760 square meters of the defendants Malit and Gutierrez land for plaintiff transmission line upon payment of an easement fee of P1. . thereby leaving only the case against the defendant spouses Ricardo Malit and Misericordia Gutierrez still to be resolved.(Annex L) The plaintiff corporation urged the Court that the assessment as recommended by their commissioner be the one adopted. . Ricardo Malit be paid as disturbance compensation the amount of P10. . Defendant spouses. . meter or the total amount of P7. Accordingly.OO) Pesos per square meter of the area covered by the Right-of-way to be granted. . . and Mrs. .600. . . (Annex M) The commissioner for recommended the following: the defendant spouses . the commissioners submitted their individual reports. dissented and .00 sq.00 therefor. the payment of Five (P 5. however.

00 per square meter as the fair and reasonable compensation for the rightof-way easement of the affected area. 83) Dissatisfied with the decision. responsive to the foregoing considerations. or a total sum of P7. the plaintiff corporation filed a motion for reconsideration which was favorably acted upon by the lower court.00 as attorney's fees' (Record on Appeal. judgment is hereby rendered ordering plaintiff National Power Corporation to pay defendant spouses Ricardo Malit and Misericordia Gutierrez the sum of P10. which is 760 squares.600. for which reason the . 1973. and in an order dated June 10. it amended its previous decision in the following tenor: On the basis of an ocular inspection made personally by the undersigned. the lower court rendered a decision the dispositive portion of which reads as follows: WHEREFORE.objected to the price recommended by both the representative of the court and of the plaintiff corporation. this court finally classified the land of the spouses Ricardo Malit and Misericordia to be partly commercial and partly agricultural. With these reports submitted by the three commissioners and on the evidence adduced by the defendants as well as the plaintiff for the purpose of proving the fair market value of the property sought to be expropriated. p.00 and P800.

1983). (Annex S) Still not satisfied. The First Division of this Court gave due course to the petition and required both parties to submit their respective memoranda (Resolution of January 12. 1982. 1972 is hereby reconsidered and set aside. There being no claim and evidence for attorney's fees. hence. the instant petition. meter awarded in the decision of December 4. an appeal was filed by petitioner (NPC) with the Court of Appeals but respondent Court of Appeals in its March 9. as follows: WHEREFORE.1972 is hereby reduced to P5. 1983 that petitioner flied its memorandum while the respondents failed to file their memorandum within the period which expired on February 24.1983. finding no reversible error committed by the court a quo. the appealed judgment is hereby affirmed with costs against the plaintiff-appellant. in the decision of December 4. . sustained the trial court. Hence.amount of P10. the case was considered submitted for decision.00 awarded as attorney's fees. the amount of P800.00 per square meter as the fair and reasonable market value of the 760 square meters belonging to the said spouses.00 per sq. It also noted in an internal resolution of August 17.

The sole issue raised by petitioner is — WHETHER PETITIONER SHOULD BE MADE TO PAY SIMPLE EASEMENT FEE OR FULL COMPENSATION FOR THE LAND TRAVERSED BY ITS TRANSMISSION LINES. petitioner submits that if full market value is required. . The trial court's observation shared by the appellate court show that ". It is the contention of petitioner that the Court of Appeals committed gross error by adjudging the petitioner liable for the payment of the full market value of the land traversed by its transmission lines. then full transfer of ownership is only the logical equivalent. and that it overlooks the undeniable fact that a simple right-of-way easement (for the passage of transmission lines) transmits no rights. except those that would result in contact with the wires. The resolution of this case hinges on the determination of whether the acquisition of a mere right-of-way is an exercise of the power of eminent domain contemplated by law. The petition is devoid of merit. except that of the easement. .Full ownership is retained by the private respondents and they are not totally deprived of the use of the land. On this premise. They can continue planting the same agricultural crops. While it is true that plaintiff are (sic) only after .

PLDT. 129 SCRA 665. and possession of. but no cogent reason appears why said power may not be availed of to impose only a burden upon the owner of condemned property. the power of eminent domain results in the taking or appropriation of title to. the expropriated property. .1981). without loss of title and possession. Garcia vs. * thus held that: Normally." The foregoing facts considered. danger to life and limbs that may be caused beneath said wires cannot altogether be discounted. 1984. Such conclusion finds support in similar cases of easement of right-of-way where the Supreme Court sustained the award of just compensation for private property condemned for public use (See National Power Corporation vs. Furthermore. it nevertheless perpetually deprives defendants of their proprietary rights as manifested by the imposition by the plaintiff upon defendants that below said transmission lines no plant higher than three (3) meters is allowed. 102 SCRA 597. while the latter shall continually pay the taxes due on said affected portion of their property. It is unquestionable that real property may. The Supreme Court. in Republic of the Philippines vs. the acquisition of the right-ofway easement falls within the purview of the power of eminent domain. of course. because of the high-tension current conveyed through said transmission lines. Court of Appeals.a right-of-way easement. Court of Appeals. and to cap it all plaintiff only pays the fee to defendants once.

No. 78742. of Small Land Owners of the Phils.R. Manaay v. vs.. G. whenever it is possible to make the assessment. be subjected to an easement of rightof-way. than the money equivalent of said property. the easement of right-of-way is definitely a taking under the power of eminent domain. The price or value of the land and its character at the time it was taken by the Government are the criteria for determining just compensation (National Power Corp. Perez. 79310. Court of Appeals. No. In the case at bar. According to private respondents. No.R. the market value of their . 79744.14 July 1989. Just compensation has always been understood to be the just and complete equivalent of the loss which the owner of the thing expropriated has to suffer by reason of the expropriation (Province of Tayabas vs. Arroyo. Secretary of Agrarian Reform. No. 467 [1938]. 79777. Juico. Assoc. the limitation imposed by NPC against the use of the land for an indefinite period deprives private respondents of its ordinary use. For these reasons. [1984]). 175 SCRA 343 [1989]). The above price refers to the market value of the land which may be the full market value thereof.R. v. Juico. G. which should be neither more nor less. 66 Phil. Inc. G. Considering the nature and effect of the installation of the 230 KV MexicoLimay transmission lines. Acuna vs. 129 SCRA 665.through expropriation. the owner of the property expropriated is entitled to a just compensation. Pabrico vs. G.R.

.lot is P50. . 93 SCRA 503 (1979]). 179 SCRA 638. It appearing that the trial court did not act capriciously and arbitrarily in setting the price of P5. justice and due process . not whatever gain would accrue to the expropriating entity (EPZA v. G. No matter how laudable NPC's purpose is. which is the measure of the indemnity. of Daet v. . it is just and equitable that they be compensated the fair and full equivalent for the loss sustained. November 8.00 per square meter of the affected property. Mun. Private respondents recognize the inherent power of eminent domain being exercised by NPC when it finally consented to the expropriation of the said portion of their land. the said award is proper and not unreasonable. Court of Appeals. Court of Appeals. subject however to payment of just compensation. Nueva Ecija and Olongapo City. On the issue of ownership being claimed by petitioner in the event that the price of P5. for which expropriation was sought. No. (Filipino Merchants v. Dulay. 85141. it is well settled that an issue which has not been raised in the Court a quo cannot be raised for the first time on appeal as it would be offensive to the basic rules of fair play. 149 SCRA 305 [1987].R. 1989.00 per square meter because the said lot is adjacent to the National and super highways of Gapan.00 per square meter be sustained.

Fernan. Petitioner only sought an easement of right-of-way. J. WHEREFORE. and as earlier discussed...Commissioner of Internal Revenue v. Gutierrez. Jr. the assailed decision of the Court of Appeals is AFFIRMED.00 a sq. and Feliciano.. Wander Philippines. 160 SCRA 560 [1988]. concur.Arellano Law Foundation lawphil . SO ORDERED. Inc. I concur but believe payment should be P10. The Lawphil Project . C. J. 160 SCRA 573 1988]). Procter and Gamble Philippines Manufacturing Corporation.J.. Footnotes * 26 SCRA 620 (1969). Commissioner of Internal Revenue v. the power of eminent domain may be exercised although title was not transferred to the expropriator. meter at the very least.

NASSER B. POTRISAM G. MARUHOM. MARUHOM. ROCANIA G. AMEER B. MARUHOM. IBRAHIM.: . LUMBA G. vs. MOHAMAD M. MARUHOM. SOLAYMAN G. Petitioner. OMAR G. CAIRORONESA M. IBRAHIM. HIDJARA G. MARUHOM. IBRAHIM. IBRAHIM. MARUHOM. FAROUK G. MARUHOM. ELIAS G. BUCAY G. RAJID NABBEL B.Today is Saturday. 2012 Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G. MAMOD G. JAMALODIN B. November 17. IBRAHIM. 183297 December 23. IBRAHIM and SARAH AIZAH B. MARUHOM.R. IBRAHIM. and LUCMAN IBRAHIM. MARUHOM. represented by his heirs ADORA B. 2009 NATIONAL POWER CORPORATION. MARUHOM. IBRAHIM. MARUHOM. DECISION NACHURA. No. MARUHOM. SINAB G. ACMAD G.* Respondents. J.

2007 issued by Hon. 2008 Decision1 of the Court of Appeals (CA) in CA-G. Mohamad M. Ibrahim (respondents) are owners of a 70. 1992. The antecedents. Hidjara G. took possession of the subterranean area of the land and constructed therein underground tunnels. Ibrahim and Cairoronesa M. IV. 02065-MIN. Maruhom. Thus. Maruhom. Solayman G. Maruhom. which granted respondents’ motion for issuance of a writ of execution.R. VI. Lucman G. III. Maruhom. Ibrahim and his co-heirs Omar G.000-square meter lot in Saduc. Lumba G.Petitioner National Power Corporation (NPC) filed this Petition for Review on Certiorari. Nangca and Balo-i in Lanao del Norte. Mamod G. Bucay G. Potrisam G. Maruhom. on October 7. Maruhom. and VII projects located in Saguiran. Maruhom. respondents demanded that NPC pay damages and vacate the subterranean portion of the land. but the demand was not heeded. Maruhom. seeking to nullify the May 30. The tunnels were used by NPC in siphoning the water of Lake Lanao and in the operation of NPC’s Agus II. Sinab G. Marawi City. V. Amer R. Farouk G. Elias G. Maruhom. without respondents’ knowledge and consent. Acmad G. Respondents only discovered the existence of the tunnels sometime in July 1992. affirming the Order dated November 13. Maruhom. Ibrahim. Maruhom. Rocania G. and Ditucalan and Fuentes in Iligan City. Lanao del Sur. NPC. Sometime in 1978. Maruhom. SP No. .

005 square meters effective from its occupancy of the foregoing area in 1978 or a total of P7.68 per square meter of the total area of 48.00 for the remaining unpaid portion of 48. 2. Denying *respondents’+ prayer for *NPC+ to dismantle the underground tunnels constructed beneath the lands of [respondents] in Lots 1.00 per square meter or a total of P48. 1298-94. judgment is hereby rendered: 1. Ordering [NPC] to pay to [respondents] the fair market value of said 70. 1994.40. on November 23. . 3.995 square meters at P1.050. and 3 as described in Survey Plan FP (VII-5) 2278 less the area of 21. docketed as Civil Case No.005 square meters. respondents instituted an action for recovery of possession of land and damages against NPC with the Regional Trial Court (RTC) of Lanao del Sur. with 6% interest per annum from the filing of this case until paid.000. 2.Hence.000. the RTC rendered a decision.974.2 the decretal portion of which reads: WHEREFORE.005.000 square meters of land covering Lots 1. 2. and 3 of Survey Plan FP (VII-5) 2278. After trial. Ordering [NPC] to pay [respondents] a reasonable monthly rental of P0.

Maruhom.4. Ordering [NPC] to pay [respondents] the sum of P200. Hidjara G. Farouk G. On August 28. On October 4.00 as attorney’s fees and the costs.000. Bucay G. 1996. and 5. 1996. Maruhom and Lumba G. NPC filed a Notice of Appeal. On August 26. it filed a vigorous opposition to the motion for execution of judgment pending appeal with a motion for reconsideration of the RTC decision. 1996. Potrisam G. Maruhom. SO ORDERED. Maruhom . Maruhom.3 Respondents then filed an Urgent Motion for Execution of Judgment Pending Appeal. Maruhom. The Decision of the RTC was executed pending appeal and the funds of NPC were garnished by respondents. Thereafter. Maruhom. NPC withdrew its Notice of Appeal to give way to the hearing of its motion for reconsideration. On the other hand. Maruhom. Ordering [NPC] to pay the further sum of P200. the RTC issued an Order granting execution pending appeal and denying NPC’s motion for reconsideration. Elias G.00 as moral damages.000. Lucman Ibrahim and respondents Omar G. Mamod G.

damages and attorney’s fees but the greatest portion of which was payment of just compensation which. 3. mistake. in effect. 2. When they learned of the nature of the judgment. 5. would make the petitioner NPC the owner of the parcels of land involved in the case.4 asserting as follows: 1.filed a Petition for Relief from Judgment. They were prevented by fraud. accident. the period of appeal had already expired. 4. They would never have agreed to the alienation of their property in favor of anybody. or excusable negligence from taking legal steps to protect and preserve their rights over their parcels of land insofar as the part of the decision decreeing just compensation for respondents’ properties. 1996 that they learned that the amounts awarded to the respondents represented not only rentals. They did not file a motion to reconsider or appeal the decision within the reglementary period of fifteen (15) days from receipt of judgment because they believed in good faith that the decision was for damages and rentals and attorney’s fees only as prayed for in the complaint. It was only on August 26. considering the fact that the parcels of land involved in this case were among the valuable .

Maruhom. Hidjara G.00 to herein [respondents] Omar G.974. 3.005.878.000. 1997. Bucay G. Maruhom.000.050.000.526. Maruhom. Maruhom.00 and by the further sum of P33. 2.5 After due proceedings. the RTC granted the petition and rendered a modified judgment dated September 8.000.40 pertaining to [respondents].00 by [P]9.00 which may be the subject of execution upon the finality of this modified judgment with 6% interest per annum from the filing of the case until paid.00 or for a difference [of] P38. Farouk G. thus: WHEREFORE. Maruhom. Mahmod G. a modified judgment is hereby rendered: 1.603.479.476.00 subject of the execution pending appeal leaving a difference of [P]4.500.properties they inherited from their dear father and they would rather see their land crumble to dust than sell it to anybody. Elias G.911. Reducing the judgment award of [respondents] for the fair market value of P48. Maruhom and Lumba G.500.00 as moral . Maruhom. Ordering [NPC] embodied in the August 7. 1996 decision to pay [respondents] the sum of P200. Portrisam G. Awarding the sum of P1. Maruhom as reasonable rental deductible from the awarded sum of P7.

000.000. SO ORDERED. Such additional filing fee shall constitute as a lien on the judgment.887. CV No.6 Lucman Ibrahim and NPC then filed their separate appeals with the CA. On June 8. thus: WHEREFORE.R. the CA rendered a Decision. and further sum of P200. the Clerk of Court of RTC Lanao del Sur is hereby directed to reassess and determine the additional filing fee that should be paid by Plaintiff-Appellant IBRAHIM taking into consideration the total amount of damages sought in the complaint vis-à-vis the actual amount of damages awarded by this Court.damages. amending it further by deleting the award of moral damages and reducing the amount of rentals and attorney’s fees.00 as attorney’s fees and costs. docketed as CA-G. 2005. premises considered. .7 setting aside the modified judgment and reinstating the original Decision. herein Appeals are hereby partially GRANTED. In this connection. respectively.40 and P50.757. 57792. the Modified Judgment is ordered SET ASIDE and rendered of no force and effect and the original Decision of the court a quo dated 7 August 1996 is hereby RESTORED with the MODIFICATION that the award of moral damages is DELETED and the amounts of rentals and attorney’s fees are REDUCED to P6.00.

-G. 168732. 2007 in G. docketed . the petition is DENIED and the Decision of the Court of Appeals in C. CV No. 2007. and issued the corresponding writ of execution. 2007.A. 2005 is AFFIRMED.R. On November 13.SO ORDERED8 The above decision was affirmed by this Court on June 29. 1996 decision. No. SO ORDERED. 57792 dated June 8. No costs.: WHEREFORE. the RTC granted the motion. To satisfy the judgment. NPC then filed a Petition for Certiorari (with Urgent Prayer for the Immediate Issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction) with the CA. respondents filed with the RTC a motion for execution of its August 7. as modified by the CA.R.9 NPC moved for reconsideration of the Decision. viz. but this Court denied it on August 29. Subsequently. a notice of garnishment was issued upon NPC’s depositary bank.

it had been consistently ruled that an easement is compensable by the full value of the property despite the fact that NPC was only after a right-of-way easement.R.R. SP No. the CA granted NPC’s prayer and issued a TRO. the CA declared that this Court’s Decision in G. 02065-MIN. .as CA-G. 168732. therefore. justifying the issuance of a writ of certiorari. 168732 intended NPC to pay the full value of the property as compensation without ordering the transfer of respondents’ title to the land. The CA. No.10 dismissing NPC’s petition for certiorari. enjoining the implementation of the writ of execution and the notice of garnishment. the CA rendered the now assailed Decision. By allowing the payment of just compensation for a parcel of land without the concomitant right of NPC to get title thereto. the RTC clearly varied the terms of the judgment in G. 2008.R. in a plethora of cases involving lands traversed by NPC’s transmission lines. It argued that the RTC gravely abused its discretion when it granted the motion for execution without ordering respondents to transfer their title in favor of NPC. if by such easement it perpetually or indefinitely deprives the land owner of his proprietary rights by imposing restrictions on the use of the property. 2007. According to the CA. Rejecting NPC’s argument. On May 30. NPC also prayed for the issuance of a temporary restraining order (TRO) to enjoin the implementation of the writ of execution and notice of garnishment. No. On November 29.

and consequently issuing the writ of execution and notice of garnishment. The petition lacks merit. thereby necessitating a transfer of title and ownership to NPC upon satisfaction of judgment. NPC insists that the payment of just compensation for the land carries with it the correlative right to obtain title or ownership of the land taken. the RTC and the CA allowed respondents to retain title to the property even after the payment of full compensation. In its July 9. was a clear case of unjust enrichment.12 this Court granted NPC’s prayer. 2008 Resolution. according to NPC.11 NPC is now before us faulting the CA for dismissing the former’s petition for certiorari.ordered NPC to pay its admitted obligation to respondents amounting to P36. It stresses that this Court’s Decision in G. NPC added that by granting respondents’ motion for execution.R. This.219. In the main.20. 2008 Decision of the CA. and issued a TRO enjoining the execution of the assailed CA Decision. . It also prayed for a TRO to enjoin respondents and all persons acting under their authority from implementing the May 30. 168732 is replete with pronouncements that the just compensation awarded to respondents corresponds to compensation for the entire land and not just for an easement or a burden on the property. No.887.

in decreeing that [NPC] pay the full value of the property as just compensation. did not order the transfer of ownership upon payment of the adjudged compensation. No such inference can be drawn from [the] reading of the entirety of the High Court’s Decision. Neither did such condition appear in the text of the RTC decision.R. the tenor of the dispositive portion of the August 7. would have Us suppose that the High Court. the terms of the judgment it seeks to enforce. As aptly pointed out by the CA in its assailed Decision: [NPC]. by its selective quotations from the Decision in G. 168732. On the contrary. as modified by the CA and affirmed by this Court.It is a fundamental legal axiom that a writ of execution must conform strictly to the dispositive portion of the decision sought to be executed. including the surface area and not just the subterranean portion. and of this Court’s Decision in G.13 Admittedly. When a writ of execution does not conform strictly to a decision’s dispositive portion. A writ of execution may not vary from. No. No. implied that [NPC] was entitled to the entire land. a perusal of the subject Decision yields to this Court the unmistakable sense that the High Court intended [NPC] to pay the full value of the subject property as just compensation without ordering the transfer o*f+ respondents’ title to the . or go beyond. 168732. it is null and void. 1996 RTC decision.R.

The assailed writ is. Respondents. This is patent from the following language of the High Court as quoted by [NPC] itself: In disregarding this procedure and failing to recognize respondents’ ownership of the sub-terrain portion. respondents are clearly entitled to the payment of just compensation. valid. . whenever it is possible to make the assessment.14 Clearly. Notwithstanding the fact that [NPC] only occupies the subterrain portion. than the money equivalent of said property.Based upon the foregoing. it is liable to pay not merely an easement but rather the full compensation for land. consistent with the final decision in this case. It must be emphasized that the acquisition of the easement is not without expense. the writ of execution issued by the RTC and affirmed by the CA does not vary. petitioner took a risk and exposed itself to greater liability with the passage of time. as the owners of the property thus expropriated. in fact. The underground tunnels impose limitations on respondents’ use of the property for an indefinite period and deprive them of its ordinary use. therefore. the nature of the easement practically deprives the owners of its normal beneficial use.This is so because in this case.land. are entitled to a just compensation which should be neither more nor less. but is.

expropriation is not limited to the acquisition of real property with a corresponding transfer of title or possession. a simple right-of-way easement transmits no rights. and possession of. v. PLDT thus held that: "Normally. The Supreme Court. without loss of title and possession. It is unquestionable that real property may.15 As we explained in Camarines Norte Electric Cooperative. Vines Realty retains full ." However. of course. but no cogent reason appears why said power may not be availed of to impose only a burden upon the owner of condemned property. except the easement. the power of eminent domain results in the taking or appropriation of title to. Court of Appeals:16 The acquisition of an easement of a right-of-way falls within the purview of the power of eminent domain.Indeed. Inc. Such conclusion finds support in easements of right-of-way where the Supreme Court sustained the award of just compensation for private property condemned for public use. the expropriated property. be subjected to an easement of rightof-way. through expropriation. in Republic v. The right-of-way easement resulting in a restriction or limitation on property rights over the land traversed by transmission lines also falls within the ambit of the term expropriation.

which must be neither more nor less than the money equivalent of the property. The word just is used to intensify the meaning of the word compensation and to convey thereby the idea that the equivalent to be rendered for the property to be taken shall be real. Considering the nature and effect of the installation power lines. It can continue doing what it wants to do with the land. For these reasons. the limitations on the use of the land for an indefinite period deprives private respondents of its ordinary use.1avvphi1 The acquisition of this easement. The measure is not the taker's gain. except those that would result in contact with the wires. but the owner's loss.ownership and it is not totally deprived of the use of the land. therefore. and ample. clear that NPC’s acquisition of an easement of right-of-way on the lands of respondents amounted to expropriation of the portions of the latter’s property for which they are entitled to a reasonable and just compensation. nevertheless. is not gratis. full. Vines Realty is entitled to payment of just compensation. substantial.17 It is. The term just compensation had been defined as the full and fair equivalent of the property taken from its owner by the expropriator.18 .

conveys the notion of willful and unreasoning action. In fine. Manubay AgroIndustrial Development Corporation. The word capricious. connotes capricious. as where the power is exercised in an arbitrary and capricious manner by reason of passion and hostility. Thus.20 this Court sustained the award of just compensation equivalent to the fair and full value of the property even if petitioners only sought the continuation of the exercise of their right-of-way easement and not the ownership over the land. Court of Appeals19 and National Power Corporation v. a clear showing of caprice and arbitrariness in the exercise of discretion is imperative. Inc. the . oppressive. when seeking the corrective hand of certiorari. v. the issuance by the RTC of a writ of execution and the notice of garnishment to satisfy the judgment in favor of respondents could not be considered grave abuse of discretion. despotic. There is simply no basis for NPC to claim that the payment of fair market value without the concomitant transfer of title constitutes an unjust enrichment. or whimsical exercise of judgment as is equivalent to lack of jurisdiction.In Camarines Norte Electric Cooperative. The abuse must be of such degree as to amount to an evasion of positive duty or a virtual refusal to perform a duty enjoined by law. in its juridical sense. NPC utterly failed to demonstrate caprice or arbitrariness on the part of the RTC in granting respondents’ motion for execution. usually used in tandem with the term arbitrary. Accordingly. The term grave abuse of discretion.21 In this case.

The assailed Decision of the Court of Appeals in CA-G. Constituted as they are to put an end to controversies. A judgment. SO ORDERED. would be nothing but an empty victory for the prevailing party. Courts must. The temporary restraining order issued by this Court on July 9. SP No.22 We. NACHURA Associate Justice WE CONCUR: RENATO C. if left unexecuted. therefore. 2008 is LIFTED. courts should frown upon any attempt to prolong them.R. guard against any scheme calculated to bring about that result. An effective and efficient administration of justice requires that once a judgment has become final. 02065-MIN is AFFIRMED. therefore. CORONA . the winning party be not deprived of the fruits of the verdict. ANTONIO EDUARDO B. write finis to this litigation. It is almost trite to say that execution is the fruit and the end of the suit and is the life of the law. WHEREFORE. the petition is DENIED.CA committed no reversible error in dismissing NPC’s petition for certiorari. Litigation must end sometime and somewhere.

CORONA Associate Justice Chairperson. PUNO . Associate Justice DIOSDADO M. I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division. Article VIII of the Constitution and the Division Chairperson's Attestation.Associate Justice Chairperson PRESBITERO J. RENATO C. JR. VELASCO. REYNATO S. Third Division CERTIFICATION Pursuant to Section 13. PERALTA Associate Justice MARIANO C. DEL CASTILLO** Associate Justice ATTESTATION I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

Chief Justice Footnotes * The present petition impleaded Hon. However. 5 Id. Lanao del Sur. RTC-Branch 9. pp. Section 4. the deletion of Hon. Amer Ibrahim. Atty. with Associate Justices Mario N. Cairoding P. concurring. Branch 9. Rule 45 of the Revised Rules of Court provides that the petition shall not implead the lower courts and judges thereof as petitioners or respondents. Ibrahim. Sheriff IV. Marawi City. ** Additional member per Special Order No. Presiding Judge of the Regional Trial Court of Lanao del Sur. Maruhom. Lopez and Elihu A. 1 Penned by Associate Justice RomuloV. 4 Id. 3 Id. and Acmad C. Clerk of Court VI. at 182-186. 2 Rollo. pp. 2009. Atty. 37-51. Marawi City. at 98-99. Aliponto. Hence. Borja. Ybañez. rollo. 805 dated December 4. at 183-184. . 89-99. Maruhom and Aliponto from the title.

R. at 118-119. 14 Rollo.6 Id.R. concurring. San Pedro. 17 Id. pp. 10 Supra note 1. 7 Penned by Associate Justice Myrna Dimaranan-Vidal. 2000. 9 Rollo. No. G. September 26. 147. 13 Development Bank of the Phils. 151. 15 National Power Corporation v. No. 53-54. 8 Id. 503 SCRA 333. November 20. .. v. 161 (2004). Union Bank of the Phils. 12 Id. 109338. pp. 138. p. 345 SCRA 85. 2006. Camello. 464 Phil. with Associate Justices Teresita Dy-Liacco Flores and Edgardo A. at 124-125. 16 G. 353. 11 Rollo. at 94-95. 47-48. id. at 100-119. 170945.

No. No. G. 146157. G.18 National Power Corporation v. 150936. 168732 . 67.R. 2008. 2007. Sr. 19 Supra note 16. 20 G. 2004. August 18. Abundo. No.R. 2009. Development Bank of the Philippines. January 24.R. 22 La Campana Development Corporation v. No. 21 Torres v. 667. G.R. The Lawphil Project . February 13. No. de Capin. 174263.. 512 SCRA 556. 569 SCRA 648. 175176.Arellano Law Foundation FIRST DIVISION NATIONAL POWER G. Vda. 437 SCRA 60. October 17. 568-569.R.

and GARCIA. AZCUNA. Present: -versus- LUCMAN G.J. BUCAY G. G. MARUHOM. MARUHOM. MARUHOM.CORPORATION. HIDJARA G. C. SANDOVAL- CORONA. OMAR Chairperson.. MARUHOM. Promulgated: . MARUHOM. LUMBA G. MARUHOM. FAROUK G. JJ. POTRISAM G.* MARUHOM. Petitioner. ELIAS G. ROCANIA G. GUTIERREZ. PUNO. IBRAHIM.

J.MARUHOM. SINAB G.: . and CAIRONESA M. 2007 X---------------------------------------------------------------------------------------X DECISION AZCUNA. June 29. MARUHOM. ACMAD G. MARUHOM. MOHAMAD M. IBRAHIM. SOLAYMAN G. Respondents. MARUHOM. IBRAHIM.

Maruhom. Mamod G. Lumba G. Maruhom. Hidjara G. respondent Lucman G. in his personal capacity and in behalf of his co-heirs Omar G. 57792. Rocania G. Maruhom. Ibrahim. Maruhom. Maruhom.This is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to annul the Decision[1] dated June 8. Maruhom. Mohamad M. 1994. Acmad G. 2005 rendered by the Court of Appeals (CA) in C. Maruhom.R. Elias G. Farouk G. Bucay G. Potrisam G. Maruhom.A. Maruhom. CV No. Solayman G. The facts are as follows: On November 23. instituted an action against petitioner National Power Corporation (NAPOCOR) for recovery of possession of land and damages before the Regional Trial Court (RTC) of Lanao del Sur. Ibrahim and Caironesa M. Maruhom. .-G. Sinab G. Maruhom. Ibrahim. Maruhom.

and Ditucalan and Fuentes in Iligan City. respondent Omar G. 14. i. Ibrahim and his co-heirs claimed that they were owners of several parcels of land described in Survey Plan FP (VII-5) 2278 consisting of 70. The existence of the tunnels was only discovered sometime in July 1992 by respondents and then later confirmed on November 13. divided into three (3) lots. Sometime in 1978. Maruhom requested the Marawi City Water District for a permit to construct and/or install a motorized deep well in Lot 3 located in Saduc. took possession of the sub-terrain area of their lands and constructed therein underground tunnels. Lanao del Sur.e. 1992 by NAPOCOR itself through a memorandum issued by the latter’s Acting Assistant Project Manager. and 3 consisting of 31. On September 19. VII projects located in Saguiran. Lots 1. NAPOCOR. through alleged stealth and without respondents’ knowledge and prior consent.894.191 square meters each respectively. IV.000 square meters. 1992. Nangca and Balo-i in Lanao del Norte. The tunnels were apparently being used by NAPOCOR in siphoning the water of Lake Lanao and in the operation of NAPOCOR’s Agus II. V. III.In their complaint. 1992. 2.915. Marawi City but his request was turned down because the construction of the deep well would cause danger to lives and property. On October 7. respondents demanded that NAPOCOR pay damages and . and 23. VI.

NAPOCOR filed an answer with counterclaim denying the material allegations of the complaint and interposing affirmative and special defenses. serious anxiety and shock thereby entitling them to recover moral damages and that by way of example for the public good. namely that (1) there is a failure to state a cause of action since respondents seek possession of the sub-terrain portion when they were never in possession of the same. (2) respondents have no cause of action because they failed to show proof that they were the owners of the property.vacate the sub-terrain portion of their lands but the latter refused to vacate much less pay damages. Disputing respondents’ claim. Further. and (3) the tunnels are a government project for the benefit of all and all private lands are subject to such easement as may be necessary for the same. NAPOCOR must be held liable for exemplary damages.[2] . Respondents further averred that the construction of the underground tunnels has endangered their lives and properties as Marawi City lies in an area of local volcanic and tectonic activity. these illegally constructed tunnels caused them sleepless nights.

Ordering defendant to pay to plaintiffs the fair market value of said 70. 1996.000. judgment is hereby rendered: 1. 2. the RTC rendered a Decision.000 square meters of land covering Lots 1. and 3 as described in Survey Plan FP (VII-5) 2278 less the area of 21. with 6% interest per annum from the filing of this case until paid. .000.On August 7. 2. Denying plaintiffs’ *private respondents’+ prayer for defendant [petitioner] National Power Corporation to dismantle the underground tunnels constructed between the lands of plaintiffs in Lots 1.00 for the remaining unpaid portion of 48.005 square meters. and 3 of Survey Plan FP (VII-5) 2278.995 square meters at P1. the decretal portion of which reads as follows: WHEREFORE.005. 2.00 per square meter or a total of P48.

000.68 per square meter of the total area of 48.974. Ibrahim. Ordering defendant to pay plaintiffs the sum of P200.00 as moral damages.000. Ordering defendant to pay plaintiffs a reasonable monthly rental of P0. 1996. joined by his co-heirs.050. 4. filed an Urgent Motion for Execution of Judgment Pending Appeal. NAPOCOR filed a vigorous opposition to the motion for execution of . Thereafter.005 square meters effective from its occupancy of the foregoing area in 1978 or a total of P7. NAPOCOR filed a Notice of Appeal by registered mail on August 19.3.40. On the other hand.00 as attorney’s fees and the costs.[3] On August 15. and 5. 1996. SO ORDERED. Ordering defendant to pay the further sum of P200.

NAPOCOR filed its Notice of Appeal by registered mail which was denied by the RTC on the ground of having been filed out of time.judgment pending appeal with a motion for reconsideration of the Decision which it had received on August 9. 1996. Maruhom. . 1996. 1996. the RTC issued an Order granting execution pending appeal and denying NAPOCOR’s motion for reconsideration. Elias G. 1996. On September 9. the Decision of the RTC was executed pending appeal and funds of NAPOCOR were garnished by respondents Ibrahim and his co-heirs. a Petition for Relief from Judgment was filed by respondents Omar G. which Order was received by NAPOCOR on September 6. Maruhom. On August 26. 1996. 1996. NAPOCOR filed a Manifestation and Motion withdrawing its Notice of Appeal purposely to give way to the hearing of its motion for reconsideration. On October 4. On August 28. Meanwhile.

1996 that they learned that the amounts awarded to the plaintiffs represented not only rentals. Potrisam G. Maruhom. Maruhom. damages and attorney’s fees but the greatest portion of which was payment of just compensation which in effect would make the defendant NPC the owner of the parcels of land involved in the case. Maruhom and Lumba G.Bucay G. Maruhom asserting as follows: 1) they did not file a motion to reconsider or appeal the decision within the reglementary period of fifteen (15) days from receipt of judgment because they believed in good faith that the decision was for damages and rentals and attorney’s fees only as prayed for in the complaint: 2) it was only on August 26. Maruhom. the period of appeal has already expired. Maruhom. Mamod G. Hidjara G. Farouk G. . 3) when they learned of the nature of the judgment.

5) they would never have agreed to the alienation of their property in favor of anybody. accident. a modified judgment is hereby rendered: . or excusable negligence from taking legal steps to protect and preserve their rights over their parcels of land in so far as the part of the decision decreeing just compensation for petitioners’ properties. considering the fact that the parcels of land involved in this case were among the valuable properties they inherited from their dear father and they would rather see their land crumble to dust than sell it to anybody.4) they were prevented by fraud. thus: WHEREFORE.[4] The RTC granted the petition and rendered a modified judgment dated September 8. mistake. 1997.

Elias G. Maruhom.000.00 subject of the execution pending appeal leaving a difference of 4.526.00 to herein petitioners Omar G.000.000.00 and by the further sum of P33.40 pertaining to plaintiffs. Maruhom as reasonable rental deductible from the awarded sum of P7.500.00 which may be the subject of execution upon the finality of this modified judgment with 6% interest per annum from the filing of the case until paid.00 by 9.603.000. 2) Awarding the sum of P1.005. Maruhom.00 as moral damages.911. Maruhom and Lumba G.878.479.000.476. Hidjara G. Maruhom. 1996 decision to pay plaintiffs the sum of P200.974. Maruhom. Mahmod G.500. Portrisam G.00 or for a difference by P38. Maruhom. and further sum of P200.00 as attorney’s fees and costs. Maruhom. SO ORDERED. 3) Ordering defendant embodied in the August 7. Farouk G.[5] . Bucay G.1) Reducing the judgment award of plaintiffs for the fair market value of P48.050.

both respondent Ibrahim and NAPOCOR appealed to the CA.Subsequently. . amending it further by deleting the award of moral damages and reducing the amount of rentals and attorney’s fees. the CA set aside the modified judgment and reinstated the original Decision dated August 7. 2005. the Modified Judgment is ordered SET ASIDE and rendered of no force and effect and the original Decision of the court a quo dated 7 August 1996 is hereby RESTORED with the MODIFICATION that the award of moral damages is DELETED and the amounts of rentals and attorney’s fees are REDUCED to P6.000.757.40 and P50. In the Decision dated June 8.00. 1996. premises considered. herein Appeals are hereby partially GRANTED. thus: WHEREFORE. respectively.888.

In this connection. this petition ascribing the following errors to the CA: (a) RESPONDENTS WERE NOT DENIED THE BENEFICIAL USE OF THEIR SUBJECT PROPERTIES TO ENTITLE THEM TO JUST COMPENSATION BY WAY OF DAMAGES. the Clerk of Court of RTC Lanao del Sur is hereby directed to reassess and determine the additional filing fee that should be paid by Plaintiff-Appellant IBRAHIM taking into consideration the total amount of damages sought in the complaint vis-à-vis the actual amount of damages awarded by this Court. Such additional filing fee shall constitute a lien on the judgment. SO ORDERED. .[6] Hence.

Petitioner maintains that the sub-terrain portion where the underground tunnels were constructed does not belong to respondents because.(b) ASSUMING THAT RESPONDENTS ARE ENTITLED TO JUST COMPENSATION BY WAY OF DAMAGES. the basis for computing the same. even conceding the fact that respondents owned the property. NO EVIDENCE WAS PRESENTED ANENT THE VALUATION OF RESPONDENTS’ PROPERTY AT THE TIME OF ITS TAKING IN THE YEAR 1978 TO JUSTIFY THE AWARD OF ONE THOUSAND SQUARE METERS (P1000.00/SQ. In any case. M. Omar G. Maruhom. their right to the subsoil of the same does not extend beyond what is necessary to enable them to obtain all the utility and convenience that such property can normally give. citing as an example the fact that one of the respondents. and. The threshold issue of whether respondents are entitled to just compensation hinges upon who owns the sub-terrain area occupied by petitioner.) EVEN AS PAYMENT OF BACK RENTALS IS ITSELF IMPROPER. by extension. This case revolves around the propriety of paying just compensation to respondents. had . petitioner asserts that respondents were still able to use the subject property even with the existence of the tunnels.

Generally.established his residence on a part of the property. purely conjectural and speculative. its findings of fact being as a rule conclusive and binding on the Court. in an appeal by certiorari under Rule 45 of the Rules of Court. In the present case.[7] The contention lacks merit. petitioner failed to point to any evidence demonstrating grave abuse of discretion on the part of the CA or to any other circumstances which would call for the .[8] The jurisdiction of the Court in cases brought to it from the CA is limited to reviewing and revising the errors of law imputed to it. Petitioner concludes that the underground tunnels 115 meters below respondents’ property could not have caused damage or prejudice to respondents and their claim to this effect was. the Court will not examine the evidence introduced by the parties below to determine if they correctly assessed and evaluated the evidence on record. therefore. the Court does not pass upon questions of fact. Absent any showing that the trial and appellate courts gravely abused their discretion.

without detriment to servitudes and subject to special laws and ordinances. cannot be disturbed. This conclusion is drawn from Article 437 of the Civil Code which provides: ART. the CA’s findings which upheld those of the trial court that respondents owned and possessed the property and that its substrata was possessed by petitioner since 1978 for the underground tunnels. The owner of a parcel of land is the owner of its surface and of everything under it. the ownership of land extends to the surface as well as to the subsoil under it. require a definitive and categorical classification. the Court sustains the finding of the lower courts that the sub-terrain portion of the property similarly belongs to respondents. Court of Appeals. consequently.[9] this principle was applied to show that rights over lands are indivisible and. In Republic of the Philippines v. Moreover. Consequently. thus: . He cannot complain of the reasonable requirements of aerial navigation.application of the exceptions to the above rule. Thus. 437. and he can construct thereon any works or make any plantations and excavations which he may deem proper.

The Court of Appeals justified this by saying there is “no conflict of interest” between the owners of the surface rights and the owners of the sub-surface rights. This is rather strange doctrine. This is also difficult to understand. the surface owner will be planting on the land while the mining locator will be boring tunnels underneath. especially in its practical application. for it is a well-known principle that the owner of a piece of land has rights not only to its surface but also to everything underneath and the airspace above it up to a reasonable height. The farmer cannot dig a well because he may interfere with the mining operations below and the miner cannot blast a tunnel lest he destroy the crops above. subject to separate claims of title. How deep can the farmer. Under the theory of the respondent court. Under the aforesaid ruling. the land is classified as mineral underneath and agricultural on the surface. and how high can the miner go without encroaching on each others rights? Where is the dividing line between the surface and the sub-surface rights? The Court feels that the rights over the land are indivisible and that the land itself cannot be half agricultural and half .

[11] . Registered landowners may even be ousted of ownership and possession of their properties in the event the latter are reclassified as mineral lands because real properties are characteristically indivisible. they are entitled to just compensation under the Mining Laws or in appropriate expropriation proceedings.[10] Moreover. The classification must be categorical. and it is extinguished beyond such limit as there would be no more interest protected by law. Presumably.mineral. the landowners’ right extends to such height or depth where it is possible for them to obtain some benefit or enjoyment. petitioner’s argument that the landowners’ right extends to the sub-soil insofar as necessary for their practical interests serves only to further weaken its case. the land must be either completely mineral or completely agricultural. For the loss sustained by such owners. The theory would limit the right to the sub-soil upon the economic utility which such area offers to the surface owners.

In this regard. K). thus: Has it deprived the plaintiffs of the use of their lands when from the evidence they have already existing residential houses over said tunnels and it was not shown that the tunnels either destroyed said houses or disturb[ed] the possession thereof by plaintiffs? From the evidence. The fact that they could not was appreciated by the RTC as proof that the tunnels interfered with respondents’ enjoyment of their property and deprived them of its full use and enjoyment. He was refused the permit “because the construction of the deep well as (sic) the parcels . Respondents. therefore. 1992 by the Acting Assistant Project Manager. an affirmative answer seems to be in order. still had a legal interest in the sub-terrain portion insofar as they could have excavated the same for the construction of the deep well. 1992. On September 16. Agus 1 Hydro Electric Project (Exh. Omar Maruhom (co-heir) requested the Marawi City Water District for permit to construct a motorized deep well over Lot 3 for his residential house (Exh. the trial court found that respondents could have dug upon their property motorized deep wells but were prevented from doing so by the authorities precisely because of the construction and existence of the tunnels underneath the surface of their property. The plaintiffs and [their] co-heirs discovered [these] big underground tunnels in 1992. Q). This was confirmed by the defendant on November 13. Atty.

N). R). Moreover. 1995. but the application was disapproved by the bank in its letter of April 25. On March 6. O) stating that: . Lake Lanao has been formed by extensive earth movements and is considered to be a drowned basin of volcano/tectonic origin. it has been shown that the underground tunnels [have] deprived the plaintiffs of the lawful use of the land and considerably reduced its value. In Marawi City. Q-2). plaintiffs applied for a two-million peso loan with the Amanah Islamic Bank for the expansion of the operation of the Ameer Construction and Integrated Services to be secured by said land (Exh. 1995 (Exh. there are a number of former volcanoes and an extensive amount of faulting. (Feasibility Report on Marawi City Water District by Kampsa-Kruger.” He was informed that “beneath your lands are constructed the Napocor underground tunnel in connection with Agua Hydroelectric plant” (Exh. Architects and Economists. Some of these faults are still moving. Consulting Engineers. Exh.of land will cause danger to lives and property. It has been proved indubitably that Marawi City lies in an area of local volcanic and tectonic activity. There in fact exists ample evidence that this construction of the tunnel without the prior consent of plaintiffs beneath the latter’s property endangered the lives and properties of said plaintiffs.

” All the foregoing evidence and findings convince this Court that preponderantly plaintiffs have established the condemnation of their land covering an area of 48.[12] . hence. meters located at Saduc. Marawi City by the defendant National Power Corporation without even the benefit of expropriation proceedings or the payment of any just compensation and/or reasonable monthly rental since 1978. property with an existing encumbrance cannot be considered neither accepted as collateral for a loan.“Apropos to this. we regret to inform you that we cannot consider your loan application due to the following reasons.005 sq. which tunnel is traversing underneath your property. to wit: That per my actual ocular inspection and verification. subject property offered as collateral has an existing underground tunnel by the NPC for the Agus I Project. As a matter of bank policy. an encumbrance.

though.[14] Petitioner contends that the underground tunnels in this case constitute an easement upon the property of respondents which does not involve any loss of title or possession. at any time. validly exercised the power of eminent domain to acquire the easement over respondents’ property as this power encompasses not only the taking or appropriation of title to and possession of the expropriated property but likewise covers even the imposition of a mere burden upon the owner of the condemned property. however. violates the due process rights of respondents as it was without notice and indemnity to them and did not go through proper expropriation proceedings. landowners cannot be deprived of their right over their land until expropriation proceedings are .In the past. Petitioner could have. the Court has held that if the government takes property without expropriation and devotes the property to public use. after many years. The manner in which the easement was created by petitioner.[15] Significantly.[13] This is in accordance with the principle that persons shall not be deprived of their property except by competent authority and for public use and always upon payment of just compensation. the property owner may demand payment of just compensation in the event restoration of possession is neither convenient nor feasible.

are entitled to a just compensation which should be neither more nor less. respondents are clearly entitled to the payment of just compensation.[17] Notwithstanding the fact that petitioner only occupies the sub-terrain portion. that there is payment of just compensation and that there is due process of law. whenever it is possible to make the assessment. This is so because in this case.[18] . It must be emphasized that the acquisition of the easement is not without expense.instituted in court. The court must then see to it that the taking is for public use. than the money equivalent of said property. it is liable to pay not merely an easement fee but rather the full compensation for land. the nature of the easement practically deprives the owners of its normal beneficial use. Respondents. petitioner took a risk and exposed itself to greater liability with the passage of time. The underground tunnels impose limitations on respondents’ use of the property for an indefinite period and deprive them of its ordinary use. Based upon the foregoing. as the owners of the property thus expropriated.[16] In disregarding this procedure and failing to recognize respondents’ ownership of the sub-terrain portion.

There is a “taking” in .The entitlement of respondents to just compensation having been settled. In this regard. where there is a practical destruction or a material impairment of the value of their property. petitioner claims that the basis for the computation of the just compensation should be the value of the property at the time it was taken in 1978. Petitioner also impugns the reliance made by the CA upon National Power Corporation v.[22] There is a “taking” in this sense when the owners are actually deprived or dispossessed of their property. The CA found that “the award of damages is not excessive because the P1000 per square meter as the fair market value was sustained in a case involving a lot adjoining the property in question which case involved an expropriation by [petitioner] of portion of Lot 1 of the subdivision plan (LRC) PSD 116159 which is adjacent to Lots 2 and 3 of the same subdivision plan which is the subject of the instant controversy.”*20+ Just compensation has been understood to be the just and complete equivalent of the loss[21] and is ordinarily determined by referring to the value of the land and its character at the time it was taken by the expropriating authority. the issue now is on the manner of computing the same. or when they are deprived of the ordinary use thereof. Court of Appeals and Macapanton Mangondato[19] as the basis for computing the amount of just compensation in this action.

NAPOCOR in that case took the property of therein respondents in 1979. “taking” of the property for purposes of eminent domain entails that the entry into the property must be under warrant or color of legal authority.[24] Under the factual backdrop of this case..this context when the expropriator enters private property not only for a momentary period but for more permanent duration. It was only in 1990. . allegedly under the mistaken belief that it was public land. after more than a decade of beneficial use. This situation is on all fours with that in the Mangondato case. using it to build its Aqua I Hydroelectric Plant Project. Petitioner justified its nonpayment of the indemnity due respondents upon its mistaken belief that the property formed part of the public dominion. for the purpose of devoting the property to a public use in such a manner as to oust the owner and deprive him of all beneficial enjoyment thereof.e. that the entry into the property is under warrant or color of legal authority. i. that NAPOCOR recognized therein respondents’ ownership and negotiated for the voluntary purchase of the property.*23+ Moreover. without paying any compensation. is patently lacking. the last element of taking mentioned.

Hence. the time of the taking coincides with the filing of the complaint for expropriation. the court may enter an order of condemnation declaring that the plaintiff has a lawful right to take the property sought to be condemned. x x x” (Italics supplied). for the public use or purpose described in the complaint. Order of Condemnation. upon the payment of just compensation to be determined as of the date of the filing of the complaint. Normally.In Mangondato. as follows: “Sec. 4. When such a motion is overruled or when any party fails to defend as required by this rule. many ruling . this Court held: The First Issue: Date of Taking or Date of Suit? The general rule in determining “just compensation” in eminent domain is the value of the property as of the date of the filing of the complaint.

which is the true measure of the damages. Caro de Araullo.of this Court have equated just compensation with the value of the property as of the time of filing of the complaint consistent with the above provision of the Rules. however. To permit them to do so would be to allow them to recover more than the value of the land at the time it was taken. admits of an exception: where this Court fixed the value of the property as of the date it was taken and not the date of the commencement of the expropriation proceedings. the just compensation is to be ascertained as of the time of filing of the complaint. the Court ruled that “x x x the owners of the land have no right to recover damages for this unearned increment resulting from the construction of the public improvement (lengthening of Taft Avenue from Manila to Pasay) from which the land was taken. or just compensation. In the old case of Provincial Government of Rizal vs.” . So too. where the institution of the action precedes entry to the property. and would discourage the construction of important public improvements. The general rule.

the exception finds the application where the owner would be given undue incremental advantages arising from the use to which the government devotes the property expropriated -. From that time. “x x x the owner as is the constitutional intent. Mr. the extension of a main thoroughfare as was in the case in Caro . he could not recover the value of what was lost. said. the increment in price would accrue to the owner. It would be injustice to him certainly if from such a period.In subsequent cases. invariably held that the time of taking is the critical date in determining lawful or just compensation. The doctrine to which this Court has been committed is intended precisely to avoid either contingency fraught with unfairness. he had been deprived thereof.” Simply stated. He had no choice but to submit. Justifying this stance. There could be on the other hand. to be despoiled of such a right. following the above doctrine.as for instance. the Court. however. speaking for the Court in Municipality of La Carlota vs. Justice (later Chief Justice) Enrique Fernando. is paid what he is entitled to according to the value of the property so devoted to public use as of the date of taking. No less than the fundamental law guarantees just compensation. injustice to the expropriator if by a delay in the collection. The Spouses Felicidad Baltazar and Vicente Gan. He is not.

In the instant case. however.00 reached in 1992 was due to increments directly caused by petitioner’s use of the land. as indeed the records do not show any evidence that the valuation of P1. Section 4. it has the burden in proving its claim that its occupancy and use -. Side Issue: When is there “Taking” of Property? But there is yet another cogent reason why this petition should be denied and why the respondent Court should be sustained.de Araullo.000. Since the petitioner is claiming an exception to Rule 67.was the direct cause of the increase in valuation from 1978 to 1992.not ordinary inflation and increase in land values -. it is difficult to conceive of how there could have been an extra-ordinary increase in the value of the owner’s land arising from the expropriation. An examination of the undisputed factual environment would show that the “taking” was not really made in 1978. .

and (5) the utilization of the property for public use must be in such a way to oust the owner and deprive him of all beneficial enjoyment of the property. the petitioner flatly refused the claim for compensation. the petitioner’s entrance in 1978 was without intent to expropriate or was not made under warrant or color of legal authority. (2) the entrance into private property must be for more than a momentary period.This Court has defined the elements of “taking” as the main ingredient in the exercise of power of eminent domain.”(Italics supplied) In this case. (3) the entry into the property should be under warrant or color of legal authority. (4) the property must be devoted to a public use or otherwise informally appropriated or injuriously affected. When the private respondent raised his claim of ownership sometime in 1979. 1354. nakedly insisted that the property was public land and wrongly justified its possession by alleging it had . for it believed the property was public land covered by Proclamation No. in the following words: “A number of circumstances must be present in “taking” of property for purposes of eminent domain: (1) the expropriator must enter a private property.

Clearly. Thus the respondent Court correctly held: “If We decree that the fair market value of the land be determined as of 1978. Only in 1992. for any reason other than for eminent domain would occupy another’s property and when later pressed for payment. did petitioner manifest its intention to exercise the power of eminent domain. then We would be sanctioning a deceptive scheme whereby NAPOCOR. This is a simple attempt at a voluntary purchase and sale.already paid “financial assistance” to Marawi City in exchange for the rights over the property. after more than a decade of beneficial use. did the petitioner recognize private respondent’s ownership and negotiate for the voluntary purchase of the property. first negotiate for a low price and then conveniently expropriate the property when . after the private respondent sued to recover possession and petitioner filed its Complaint to expropriate. Obviously. Only in 1990. A Deed of Sale with provisional payment and subject to negotiations for the correct price was then executed. the petitioner neglected and/or refused to exercise the power of eminent domain. this is not the intent nor the expropriation contemplated by law.

The Court held that being bound by the said contract. Expropriation could be resorted to “only when it is made necessary by the opposition of the owner to the sale or by the lack of any agreement as to the price. as sought by the defendant. is in force. as we have interpreted it.the land owner refuses to accept its offer claiming that the taking of the property for the purpose of the eminent domain should be reckoned as of the date when it started to occupy the property and that the value of the property should be computed as of the date of the taking despite the increase in the meantime in the value of the property. not having been revoked by the parties or by judicial decision.” Said the Court: “The contract.” In Noble vs. in so far as it refers to the purchase of the building. therefore. Expropriation lies only when it is made necessary by the . the expropriation thereof. the City could not expropriate the building. is baseless. under a valid and subsisting contract. This being the case. and the plaintiff being agreeable to its sale. the city being bound to buy the building at an agreed price. City of Manila. the City entered into a lease-purchase agreement of a building constructed by the petitioner’s predecessor-in-interest in accordance with the specifications of the former.

[25] In the present case. There being in the present case a valid and subsisting contract. to allow petitioner to use the date it constructed the tunnels as the date of valuation would be grossly unfair. petitioner effectively repudiated the deed of sale it entered into with the private respondent when it passed Resolution No. filed suit. First. In fact. that payment “shall be effective only after Agus I HE project has been placed in operation. barely a month. 92-121 on May 25. there is no reason for the expropriation.opposition of the owner to the sale or by the lack of any agreement as to the price. it did not enter the land under warrant or color of legal authority or with intent to expropriate the same.” It was only then that petitioner’s intent to expropriate became manifest as private respondent disagreed and.” (Italics supplied) In the instant case. inter alia. between the owner of the building and the city. for the purchase thereof at an agreed price. 1992 authorizing its president to negotiate. it did not bother to notify the owners and wrongly assumed it had the right to dig those tunnels under .

is the amount of P1. therefore. as affirmed by the CA. when respondents discovered the construction of the huge underground tunnels beneath their lands and petitioner confirmed the same and started negotiations for their purchase but no agreement could be reached.their property. the tunnels. meter as of 1990. In an .00 per square meter. namely. The trial court. the “improvements” introduced by petitioner. The fair market value as held by the respondent Court. Lot 1 (the property involved herein being Lots 2 and 3 of the same subdivision plan). rightly computed the valuation of the property as of 1992.[26] As to the amount of the valuation.000. Secondly. thus: The Second Issue: Valuation We now come to the issue of valuation. as sustained by this Court in Mangondato. in no way contributed to an increase in the value of the land. the RTC and the CA both used as basis the value of the adjacent property.000 per sq. which was valued at P1.

Inasmuch as the determination of just compensation in eminent domain cases is a judicial function and factual findings of the Court of Appeals are conclusive on the parties and reviewable only when the case falls within the recognized exceptions. as is the case here. we see no reason to disturb the factual findings as to valuation of the subject property. The amount fixed and agreed to by the respondent appellate Court is not grossly exorbitant. a trial before Commissioners is indispensable to allow the parties to present evidence on the issue of just compensation. . which is not the situation obtaining in this petition. with a general knowledge of the appraisal of real estate and the prevailing prices of land in the vicinity of the land in question so that his opinion on the valuation of the property cannot be lightly brushed aside. To quote: “Commissioner Ali comes from the Office of the Register of Deeds who may well be considered an expert. the court-and-the-parties-appointed commissioners did not abuse their authority in evaluating the evidence submitted to them nor misappreciate the clear preponderance of evidence.expropriation case where the principal issue is the determination of just compensation. As can be gleaned from the records.

00 per square meter. differs from the 2 commissioners only because his report was based on the valuation as of 1978 by the City Appraisal Committee as clarified by the latter’s chairman in response to NAPOCOR’s general counsel’s query. On the . we agree with the Court of Appeals that petitioner has failed to show why it should be granted an exemption from the general rule in determining just compensation provided under Section 4 of Rule 67.“The prevailing market value of the land is only one of the determinants used by the commissioners’ report the other being as herein shown: xxx xxx “Commissioner Doromal’s report.” In sum. recommending P300.

57792 dated June 8. such general rule should in fact be observed in this case. SO ORDERED.-G. No costs. . Furthermore. the petition is DENIED and the Decision of the Court of Appeals in C. indeed. private respondent has convinced us that. these are factual matters that are not within the ambit of the present review.R. WHEREFORE.[27] Petitioner has not shown any error on the part of the CA in reaching such a valuation.A. 2005 is AFFIRMED.contrary. CV No.

PUNO Chairperson Chief Justice .ADOLFO S. AZCUNA Associate Justice WE CONCUR: REYNATO S.

GARCIA Associate Justice .(On Leave) ANGELINA SANDOVAL-GUTIERREZ Associate Justice Justice RENATO C. CORONA Associate CANCIO C.

pp. at 117-118. . Id. Rollo. REYNATO S. Article VIII of the Constitution. PUNO Chief Justice * [1] [2] On Leave.CERTIFICATION Pursuant to Section 13. 114-133. it is hereby certified that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.

April 15. at 122-123. Id. 435. at 121-122. p. Commentaries and Jurisprudence on the Civil Code. 324 SCRA 85. [8] Concepcion v. 522 (2000). Vol. No. Id. 90. CA. 160 SCRA 228. Sec. January 31. [14] CONSTITUTION. II.R. Court of Appeals. 152-154.R. [12] [13] Rollo. Id. pp. Id. See also CIVIL CODE. Art. Id. Art. L-43938. at 118-119. 120707. III. at 132-133. 9. Militante v. No. [11] Tolentino. [9] [10] G. 386 Phil. 2000. 1988.[3] [4] [5] [6] [7] Id. G. . at 95-98.

113194. 436 SCRA 195. Rollo. 1991. 106804.R. G. August 25. p. 136 Phil. 1996. [18] [19] [20] [21] [22] Id. PLDT.[15] Republic v.R. 468 SCRA 142. CA. note 19 at 588-592. [16] NAPOCOR v.R. No. [23] Republic of the Philippines v. No. G. January 18. 1996. Supra note 16. 2004. 130. italics in the original. Gutierrez. Rollo. No. Sarabia. 254 SCRA 577. March 11. 2005. [26] See RTC decision of August 7. G. [25] Supra. . 193 SCRA 1. G. p. 20 (1969). Supra note 17. [24] Supra note 19. 60077. Emphasis supplied. 158.R. [17] NAPOCOR v. 157847. August 12. No.

64888. DECISION HERMOSISIMA. 1996] REPUBLIC OF THE PHILIPPINES (Bureau of Telecommunications). petitioners. REPUBLIC TELEPHONE COMPANY.[27] See. (now Philippine Long Distance Telephone Company) and THE INTERMEDIATE APPELLATE COURT. No. November 28.. THE EXCHANGE MANAGER AND CHIEF OPERATOR OF THE BUREAU OF TELECOMMUNICATIONS AT MALOLOS. BULACAN.R. J. INC.: Before us is a petition for the review of the decision[1] of the then Intermediate Appellate Court[2] (now the Court of Appeals) in an injunction suit[3] filed in the then Court of First . THE REGIONAL SUPERINTENDENT OF THE BUREAU OF TELECOMMUNICATIONS AT REGION NO. vs. respondents. JR. supra note 19 at 592-593. [Syllabus] FIRST DIVISION [G. II. THE DIRECTOR or ACTING DIRECTOR OF THE BUREAU OF TELECOMMUNICATIONS.

filed a motion to dismiss the aforesaid petition on the grounds that they are not the indispensable and real . BUTELCO. thru counsel. 1972 by petitioner-appellee. Respondents [BUTELCO]. Inc. seeking to enjoin the respondents Director or Acting Director of the Bureau of Telecommunications. now the Department of Telecommunications and Communications [DOTC] Telecommunications Office). Inc. RETELCO [now Philippine Long Distance Telephone Company. alleging inter alia that such operations and maintenance of the telephone system and solicitation of subscribers by respondents constituted an unfair and ruinous competition to the detriment of petitioner [RETELCO] who is a grantee of both municipal and legislative franchises for the purpose. and the agents and representatives acting in their behalf. Bulacan and from soliciting subscribers in that municipality and its environs. its Regional Superintendent. undisputed as they are. the Republic Telephone Company [RETELCO]. Bulacan. the Exchange Manager and Chief Operator of the Bureau of Telecommunications at Malolos. The respondent appellate court narrated the facts of this case. (hereafter.]) against petitioner officers of the Bureau of Telecommunications (hereafter. from operating and maintaining their local telephone system in Malolos. in the following manner: “This case arose from a complaint filed on May 17.Instance[4] (now the Regional Trial Court) by respondent Republic Telephone Company.

1972. contending that state-owned property. asking for the lifting of the Writ of Preliminary Injunction suit. restraining respondents [BUTELCO] from operating and maintaining the local telephone system in Malolos and from soliciting customers. operating and maintaining nationwide local telephone services. 1972. For the reason that evidence has to be adduced yet to determine respondents’ *BUTELCO’s+ compliance with Executive Order No. 1972..parties in interest in the case and that petitioner [RETELCO] has no cause of action against them. The motion was denied on June 20. 1972 x x x and after petitioner-appellee [RETELCO] had furnished a bond of P75. It had . on behalf of the Bureau of Telecommunications. Series of 1947. albeit immune from suit. the Republic of the Philippines. Inc. is a domestic corporation engaged in the business of installing. Order was issued on June 30. Republic Telephone Company. On December 7. Respondents [BUTELCO] filed their Answer on July 6. 94.000. followed with a motion on July 8. 1972. or RETELCO. the Answer in Intervention was admitted and the case proceeded to trial. begged leave of court to intervene in the proceedings on the ground that the suit affected state property and accordingly the state has a legal interest involved.00. had been adversely affected by the injunction. the court a quo denied the motion. There being no essential dispute between the parties over the fact that the suit indeed involved property of the state. It is not disputed that petitioner-appellee.

RETELCO commenced operation of its Malolos telephone venture in 1960 and as of 1963 it had 197 subscribers which number increased to 368 .acquired a municipal franchise on December 29. maintain and operate a local telephone system within the municipality of Malolos for a period of thirty-five years x x x. RETELCO accepted the commission certificate and filed the required deposit with the Treasurer of the Philippines on April 11. From the evidence. 1960 x x x. The municipal franchise was approved by the Provincial Board of Bulacan on January 21. 190. Series of 1959 to install. 3662 of the then Congress of the Philippines for the construction. On June 22. Bulacan per Resolution No. 67-4023 x x x. 1960 x x x. operation and maintenance of a nationwide telephone service with exchanges in various areas including the municipality of Malolos. 1960 thus certificate of public convenience and necessity was secured from the Public Service Commission on March 15. it appears that on the basis of a viable project study and reliance upon the laws affording protection against unfair and ruinous competition. 1968 under Public Service Commission case No. 1959 from the Municipal Council of Malolos. 129826 which the President of the Philippines approved on March 23. 1963. RETELCO obtained a legislative franchise under Republic Act No. It was approved by the President of the Philippines for a period of fifty years x x x and the correspondent certificate of public convenience and necessity was granted on January 16. 1960 under PSC Case No.

Laurel. they filed protests.88 x x x. In May. and sought for administrative remedies and reliefs from the Telecommunications Board. number of the telephone subscribers of RETELCO dropped to a level of 255 as of September.050. Immediately. of the House of Representatives. and the Philippine National Bank which was financing the project x x x but all were to no avail. Jr. The Bureau of Telecommunications was not subject to the jurisdiction of the Public Service Commission on matters of fixing the rates of fees to be charged to telephone . the then Speaker Jose B. But way back in February. the Secretary of the Department of Public Works and Communication. 1974 there were already 320 subscribers as against RETELCO’s capacity of accommodating 450 subscribers x x x.055. the President of the Philippines. to 131 in October. after the preliminary injunction was issued on June 30.63 in terms of revenue losses x x x. 1972. 1969 RETELCO learned through public announcements of government projects to be launched that the Bureau of Telecommunications would establish and operate telephone system in Malolos to serve government offices and the private *sector+ as well thus exposing x x x appellee’s *RETELCO’s+ telephone business operation to the risk of undue competition. The investment made reached the sum of P263.subscribers in May 1969. 1970 and to 125 as of March. the number of subscribers gradually increased such that as of January. 1972 x x x at the cost of P197. the Bureau of Telecommunications commenced its operation of the telephone exchange in Malolos and. incidentally. 1969. However. 1969.

thus RETELCO attributed the sharp decline in the number of telephone subscribers to the difference in rates individually charged by them x x x. and BUTELCO having failed to first make arrangements with the former before establishing its own telephone system. Series of 1947. Series of 1947 prohibited any other entity. and the respondents and the intervenor Bureau of . 94. finding after trial that respondents [BUTELCO] and intervenors-appellants were duplicating the functions of petitioner-appellee [RETELCO] in contravention of Executive Order No. the preliminary injunction previously granted is hereby made PERMANENT. Bulacan.subscribers. rendered a judgment making the preliminary injunction PERMANENT. besides the present operator. Respondent court found respondent RETELCO to be the present operator of telephone services in Malolos.”*5+ Respondent appellate court sustained the court a quo’s finding that Section 79 of Executive Order No. from maintaining and selling telephone services in Malolos. Bulacan. respondent appellate court upheld the propriety of the permanent injunction issued by the court a quo in this wise: “PREMISES CONSIDERED. 94. unless there was first executed a mutually acceptable arrangement or agreement between such other entity and the present operator as regards the utilization of the latter’s existing facilities. The lower court.

Telecommunications and their successors, agents, representative, and assigns, are hereby PERPETUALLY enjoined and restrained from operating and maintaining their local telephone exchange in the Municipality of Malolos, Province of Bulacan, and from soliciting customers or subscribers in said areas, UNTIL they comply with the requisites mentioned in Section 79 (B) of Executive Order No. 94, particularly with respect to needed negotiation with the petitioner or UNTIL such time as RETELCO’s telephone franchise in Malolos, Bulacan shall have lawfully ceased to exist. The bond posted for the preliminary injunction is hereby cancelled.”*6+ In rendering judgment in favor of respondent RETELCO, the appellate court rejected BUTELCO’s main argument that Section 79 of Executive Order No. 94, Series of 1947, has been repealed by Presidential Decree No. 1 promulgated by then President Marcos in the exercise of his martial law powers, by virtue of which decree the Integrated Reorganization Plan was made part of the law of the land. Under such plan, in turn, BUTELCO’s functions had been expanded to include the operation of telephone systems for government offices for purposes of augmenting inadequate private communications services. BUTELCO was rebuffed by the appellate court in this wise: “Read in its entirety, the Integrated Reorganization Plan of 1972 is expressive of the indispensable need for investigation

and negotiation to determine the actual and real conditions of local telephone facilities under private ownership – a proviso explicitly contained in Executive Order No. 94, without [sic] which, the announced policy of allowing private enterprise to flourish would be set to naught. This clearly negates the contention that Executive Order No. 94 was repealed, hence, the non-compliance therewith would be fatal and the installation and operation of telephone system by the Bureau of Telecommunications in Malolos, Bulacan was illegal at its inception which cannot [be] corrected by subsequent legislation or judicial approbation.”*7+ Hence this petition which assails the aforecited decision on the following grounds: I “THE INTERMEDIATE APPELLATE COURT ERRED IN RULING THAT THE INTEGRATED REORGANIZATION PLAN DOES NOT REPEAL AND/OR MODIFY SECTION 79 (b), EXECUTIVE ORDER NO. 94, SERIES OF 1947, INSOFAR AS THE FUNCTIONS OF BUREAU OF TELECOMMUNICATIONS ARE CONCERNED, WHICH RULING IS COMPLETELY OPPOSED TO A PRIOR DECISION OF SAME RESPONDENT COURT IN A CASE INVOLVING THE SAME PARTIES, SAME ISSUES, AND THE SAME SUBJECT MATTER. II

COROLLARY TO THE ABOVE ERROR, RESPONDENT COURT ERRED: A. IN HOLDING THAT UNDER THE INTEGRATED REORGANIZATION PLAN, THE BUREAU OF TELECOMMUNICATIONS IS NOT AUTHORIZED TO PROVIDE TELECOMMUNICATIONS FACILITIES, INCLUDING TELEPHONE SYSTEMS, FOR GOVERNMENT OFFICES, IN AREAS WHERE THERE ARE [sic] EXISTING PRIVATE TELEPHONE SYSTEM, WITHOUT NEGOTIATING WITH THE PRESENT OWNER OR OPERATORS; B. IN HOLDING THAT THE INSTALLATION AND OPERATION OF THE TELEPHONE SYSTEM BY THE BUREAU OF TELECOMMUNICATIONS, WAS ILLEGAL; AND C. IN HOLDING THAT RETELCO HAS THE EXCLUSIVE RIGHT IN OPERATING AND MAINTAINING [A] TELEPHONE SYSTEM IN GOVERNMENT OFFICES IN MALOLOS, BULACAN.”*8+ We grant the petition. We agree with petitioners that respondent RETELCO did not, even under Section 79 (b) of Executive Order No. 94, Series of 1947, have the exclusive right to operate and maintain a telephone system in Malolos, Bulacan.

RETELCO’s foremost argument is that “such operations and maintenance of the telephone system and solicitation of subscribers by [petitioners] constituted an unfair and ruinous competition to the detriment of [RETELCO which] is a grantee of both municipal and legislative franchises for the purpose.” In effect, RETELCO pleads for protection from the courts on the assumption that its franchises vested in it an exclusive right as prior operator. There is no clear showing by RETELCO, however, that its franchises are of an exclusive character. Now, the cover headings on the rollo and the records of this case show that RETELCO is now Philippine Long Distance Telephone Company (PLDT), although nothing – no document or allegation – in the rollo and the records indicate how the substitution came to be. At any rate, it may very well be pointed out as well that neither did the franchise of PLDT at the time of the controversy confer exclusive rights upon PLDT in the operation of a telephone system[9]. In fact, we have made it a matter of judicial notice that all legislative franchises for the operation of a telephone system contain the following provision: “It is expressly provided that in the event the Philippine Government should desire to maintain and operate for itself the system and enterprise herein authorized, the grantee shall surrender his franchise and will turn over to the Government said system and all serviceable equipment therein, at cost, less reasonable depreciation”.*10+

BUTELCO’s initiative to operate and maintain a telephone system in Malolos, Bulacan, was undertaken pursuant to Section 79 (b) of Executive Order No. 94, Series of 1947. Said provision vested in BUTELCO the following powers and duties, among others: “x x x (b) To investigate, consolidate, negotiate for, operate and maintain wire-telephone or radio telephone communication service throughout the Philippines by utilizing such existing facilities in cities, towns, and provinces as may be found feasible and under such terms and conditions or arrangements with the present owners or operators thereof as may be agreed upon to the satisfaction of all concerned x x x.” While we affirmed in the case of Republic v. PLDT[11], that “*t+he Bureau of Telecommunications, under section 79 (b) of Executive Order No. 94, may operate and maintain wire telephone or radio telephone communications throughout the Philippines by utilizing existing facilities in cities, towns, and provinces under such terms and conditions or arrangement with present owners or operators as may be agreed upon to the satisfaction of all concerned,”*12+ we also at the same time clarified that “nothing in these provisions

limits the Bureau to non-commercial activities or prevents it from serving the general public”.*13+ “x x x It may be that in its original prospectuses the Bureau officials had stated that the service would be limited to government offices; but such limitations could not block future expansion of the system, as authorized by the terms of the Executive Order, nor could the officials of the Bureau bind the Government not to engage in services that are authorized by law.”*14+ In other words, BUTELCO cannot be said to be prohibited under the aforecited legal provision from operating and maintaining its own telephone system in Malolos, Bulacan. Now in the subsequent case of Director of the Bureau of Telecommunications v. Aligaen, we emphasized the relevance of the latter portion of Section 79 (b) of Executive Order No. 94 as providing a caveat to any initiative on the part of the government to operate and maintain a telephone system in an area where there is an existing franchise holder. In the said case of Aligaen, we foregrounded the need for BUTELCO to first enter into negotiation or arrangement with the operator or owner of the existing telephone system. We had stated, thus: “x x x The Bureau of Telecommunications may take steps to improve the telephone service in any locality in the

Philippines, but in so doing it must first enter into negotiation or arrangement with the operator or owner of the existing telephone system. x x x When a private person or entity is granted a legislative franchise to operate a telephone system, or any public utility for that matter the government has the correlative obligation to afford the grantee of the franchise all the chances or opportunity to operate profitably, as long as public convenience is properly served rather than promote a competition with the grantee. x x x”*15+ This is not to say, however, that the lack of prior negotiation with the existing telephone system operator renders illegal the operation by BUTELCO of a telephone system. After all, the very provision in question phrases the prior negotiation requirement in less than mandatory terms. Section 79 (b) of Executive Order No. 94, Series of 1947 provides: “(b) To x x x negotiate for, operate and maintain wiretelephone or radio telecommunications service throughout the Philippines by utilizing such existing facilities in cities, towns, and provinces as may be found feasible and under such terms and conditions or arrangements with the present owners or operators thereof as may be agreed upon to the satisfaction of all concerned” *emphasis supplied+. The right of the prior operator under the aforecited provision is to be unfailingly and seriously considered in case it chooses to propose arrangements or such terms and conditions

whereby BUTELCO is to coordinate its efforts to set up and operate a telephone system with the existing operator. BUTELCO, in that case, would be obligated to exercise good faith and exert optimal cooperative efforts so that it may save government some money and prevent competition by “utilizing existing facilities in cities, towns and provinces x x x [of] the present owners or operators,” as mandated by Section 79 (b) of Executive Order No. 94. In the case at bench, BUTELCO admittedly did not fulfill this obligation. Such failure, however, is not violative of any mandatory provision of law. There was no violation of Section 79 (b) of Executive Order No. 94 but only an irregularity in the procedure by which BUTELCO undertook the operation of a telephone system in Malolos, Bulacan. It cannot be denied that, even if prior negotiations were undertaken by BUTELCO with RETELCO, and they both could not agree on mutually acceptable terms and conditions, nothing in Section 79 (b) of Executive Order No. 94 prohibits BUTELCO from proceeding with the setting up and operation of a telephone system in Malolos, Bulacan, despite the presence of a prior operator in the person of RETELCO. Thus, any injunction prohibiting BUTELCO from operating its telephone system finds no sufficiently legal and just basis under Section 79 (b) of Executive Order No. 94. To read from Section 79 (b) of Executive Order No. 94 an ultra-protectionist policy in favor of telephone franchise

holders, smacks of a promotion of the monopolization of the country’s telephone industry which, undeniably, has contributed to the slackened pace of national development. As we have pointed out in the case of PLDT v. National Telecommunications Commission[16]: “Free competition in the industry may also provide the answer to a much-desired improvement in the quality and delivery of this type of public utility, to improved technology, fast and handly mobil service, and reduced user dissatisfaction. After all, neither PLDT nor any other public utility has a constitutional right to a monopoly position in view of the Constitutional proscription that no franchise certificate or authorization shall be exclusive in character or shall last longer than fifty (50) years (ibid., Section 11; Article XIV, Section 5, 1973 Constitution; Article XIV, Section 8, 1935 Constitution).”*17+ In the light of the above ruling, necessary no longer is it to discuss the other assigned errors of petitioner. WHEREFORE, the petition is HEREBY GRANTED. The decision of respondent Court of Appeals is hereby reversed and set aside. The questioned writ of preliminary injunction made permanent by respondent Court of First Instance (now the Regional Trial Court) in its judgment, dated January 6, 1975, is hereby dissolved for having been issued without legal basis.

No pronouncement as to costs. SO ORDERED. Padilla, (Chairman), Bellosillo, Vitug, and Kapunan, JJ., concur. [1] In CA-G.R. CV No. 59004, dated May 18, 1983, penned by Associate Justice Floreliana Castro-Bartolome and concurred in by Associate Justices B.S. de la Fuente and Mariano A. Zosa, Rollo, pp. 38-46. [2] Third Civil Cases Division. [3] Civil Case No. 4183-M filed on May 17, 1972. [4] Branch VI, Bulacan. [5] Decision in CA-G.R. CV No. 59004, pp. 3-5, Rollo, pp. 38-40. [6] Id., pp. 1-2, Rollo, pp. 36-37. [7] Id., p. 9, Rollo, p. 46. [8] Petition dated September 19, 1983, pp. 14-15, Rollo, pp. 20-21. [9] PLDT v. City of Davao, 15 SCRA 75, 82 (1965).

[10] Director of the Bureau of Telecommunications v. Aligaen, 33 SCRA 368, 384. [11] 26 SCRA 620 (1969). [12] Id., p. 628. [13] Id., p. 630. [14] Id., pp. 630-631. [15] Director of the Bureau of Telecommunications v. Aligaen, 33 SCRA 368, 383-884 (1970). [16] 190 SCRA 717 (1990). [17] Id., p. 737. 3. When taking is not compensable Carlos superdrug vs dswd

lawphil Today is Saturday, November 17, 2012 Republic of the Philippines

SUPREME COURT Manila EN BANC G.R. No. 86953 November 6, 1990 MARINE RADIO COMMUNICATIONS ASSOCIATION OF THE PHILIPPINES, INC. (MARCAPI), ROBERTO GAYA, DAVID ZAFRA and SEGUNDO P. LUSTRE, JR., petitioners, vs. HON. RAINERIO O. REYES, in his capacity as Secretary of the Department of Transportation and Communications (DOTC), HON. JOSE LUIS ALCUAZ, as Commissioner of the National Telecommunications Commission (NTC), and HON. ROSAURO SIBAL, as Chief of the Telecommunications Office (TELOF) of DOTC, respondents. F. Reyes Cabigao for petitioners.

SARMIENTO, J.: The petitioners are self-described "Filipino enterpreneurs deeply involved in the business of marine radio communications in the country. 1 They are also operators of "shore-to-ship and ship-to-shore public marine coastal radio

stations, 2 and are holders of certificates of public convenience duly issued by the National Telecommunications Commission. Among other things, they handle correspondence between vessel passengers or crew and the public. 3 Sometime in July, 1988, the Department of Transportation and Communications unveiled an P880-million maritime coastal communications system project, designed to "ensure safety of lives at sea (SOLAS) through the establishment of efficient communication facilities between coast stations and ship stations and the improvement of safety in navigational routes at sea." 4 It was set out to provide, among other things, ship-to- shore and shore-to-ship public corresponding, free of charge. 5 On August 1, 1988, Atty. F. Reyes Cabigao, in his capacity as counsel for the petitioner, Marine Radio Communications Association of the Philippines, Inc., addressed an appeal to then Secretary Rainerio Reyes, in the tenor as follows: xxx xxx xxx But you undoubtedly would understand their fears. It was their feeling that entry of the government into their line of business would certainly spell for them financial ruin as it would put into serious doubt the viability of the entire marine radio communications industry. They say that, as it is today,

the industry is not viable enough. What more, they ask, if the government steps in and eventually dips its strong fingers into the pie? 6 xxx xxx xxx On August 17, 1988, the Secretary forwarded a reply, denying Atty. Cabigao's request, for the following reasons: xxx xxx xxx MARCAPI's main business concern is public correspondence. This means that MARCAPI handles only correspondence between passengers or crew on board ship and their respective offices or residences. On the other hand, the Maritime Coastal Communications System Project to be implemented by 1989 will offer services in watch and distress signal, medical and meteorological services, port services, and public correspondence, in their order of priority. You will note that public correspondence is only fourth