1. Tayag vs.

Benguet consolidated INC

26 SCRA 242
Facts:
Idonah Slade Perkins died in New York on
March 1960, the domestic administrator in New York
refused to i!e the Stock "ertificates owned #$
Perkins in the %enuet "onsolidated Inc& to the
'ncillar$ administrator here in the Phili((ines for the
(ur(ose of satisf$in the leitimate claims of local
creditors& )he "ourt of First Instance of Manila
decided that the Stock "ertificates was considered
lose #ecause of the refusal of the domestic
administrator in New York to i!e such certificates to
the ancilliar$ administrator here in the Phili((ines and
ordered %enuet "onsolidated Inc to issue New Stock
"ertificates to the 'ncilliar$ administrator& %enuet
refuses to o#e$ the order of the "FI of Manila on the
round that it is in !iolation of the "or(oration %$
*aws&
Issue:
+hether or not the %enuet "onsolidated
Inc is co!ered #$ the orders of the ",-.)&
/eld:
)he Su(reme "ourt /eld that 0a cor(oration
is an artificial #ein created #$ o(eration of law, it
owes its life to the state, its #irth #ein (urel$
de(endent on its will1& It is loicall$ inconcei!a#le
therefore that it will ha!e rihts and (ri!ilees of a
hiher (riorit$ than that of its creator& More than that,
it cannot leitimatel$ .2F-S2 to $ield o#edience to
acts of its state orans, certainl$ not e3cludin the
4-5I"I'.Y, whene!er called& It is not immune to
6udicial control in those instances, where a dut$ under
the law as ascertained in an a((ro(riate leal
(roceedin is cast u(on it&
2. Ang Pue & Co vs. Secretary o Co!!erce
"acts# 'n Pue and )an Sion orani7ed a
(artnershi( for a term of 8 $ears& )heir areement
(ro!ides that the$ can e3tend the (artneshi( for
another 8 $ears #$ mutual consent&
In 1989, .' 11:0 was enacted to reulate the retail
#usiness& Said law (ro!ided that, after its enactment,
a (artnershi( not wholl$ formed #$ Fili(inos could
continue to enae in the retail #usiness until the
e3(iration of its term so reistration of said 'n was
refused on the round that the e3tension was in
!iolation of the aforesaid 'ct&
Plaintiff "om(an$ filed a (etition for declarator$ relief
contendin their oriinal articles of (artnershi(
(ro!ided that the$ could e3tend the term of their
(artnershi(; that it constitutes a (ro(ert$ riht of
which the (artners can not #e de(ri!ed without due
(rocess or without their consent; and that the
(ro!isions of .' 11:0 cannot ad!ersel$ affect them&
*ower court dismissed their (etition& Plaintiff "o&
inter(osed an a((eal&
Issue# +,N e3tension of the (artnershi( esta#lished
#efore the enactment of .' 11:0, is in !iolation of the
said act&
$eld# )he S" ruled that orani7in a cor(oration is
not a matter of riht #ut a mere (ri!ilee which ma$
#e en6o$ed under the terms (ro!ided #$ state < law&
+hen the (artners amended the articles of
(artnershi(, the (ro!isions of .' 11:0 were alread$
in force, and so the riht claimed #$ (laintiff=
a((ellants to e3tend the oriinal term of their
(artnershi( to another fi!e $ears would #e in !iolation
of the clear intent and (ur(ose of the said law&
%. National &evelo'!ent Co!'any and Ne( Agri)
vs. P*ili''ine +eterans Ban,
Facts:
'ri3 Marketin e3ecuted in fa!or of
res(ondent a real estate mortae o!er three (arcels
of land& 'ri3 later on went #ankru(t& In order to
reha#ilitate the com(an$, then President Marcos
issued Presidential 5ecree 1>1> which mandated,
amon others, the e3tinuishin of all the mortaes
and liens attachin to the (ro(ert$ of 'ri3, and
creatin a "laims "ommittee to (rocess claims
aainst the com(an$ to #e administered mainl$ #$
N5"& .es(ondent thereon filed a claim aainst the
com(an$ on the committee& Petitioners howe!er filed
a (etition with the .)" of "alam#a, *auna in!okin
the (ro!ision of the law which cancels all mortae
liens aainst it& .es(ondent took measures to
e3tra6udiciall$ foreclose which the (etitioners o((osed
#$ filin another case in the same court& )hese cases
were consolidated& )he .)" held in fa!or of the
res(ondent on the round of unconstitutionalit$ of the
decree; mainl$ !iolation of the se(aration of (owers,
im(airment of o#liation of contracts, and !iolation of
the e?ual (rotection clause& /ence this (etition&
Issue:
Is the res(ondent esto((ed from ?uestionin
the constitutionalit$ of the law since the$ first a#ided
#$ it #$ filin a claim with the "ommittee@
Is P5 1>1> unconstitutional@
.ulin:
,n the issue of esto((el, the "ourt held that
it could not a((l$ in the (resent case since when the
res(ondent filed his claim, President Marcos was the
su(reme ruler of the countr$ and the$ could not
?uestion his acts e!en #efore the courts #ecause of
his a#solute (ower o!er all o!ernment institutions
when he was the President&
)he creation of New 'ri3 as mandated #$
the decree was also ruled as unconstitutional since it
!iolated the (rohi#ition that the Batasang Pambansa
(Congress) shall not provide for the formation,
organization, or regulation of private corporations
1
unless such corporations are owned or controlled by
the government.
P5 1>1> was held as unconstitutional on the
other rounds that it was an in!alid e3ercise of (olice
(ower, It had no lawful su#6ect and no lawful method&
It !iolated due (rocess #$ e3tinuishin all mortaes
and liens and interests which are (ro(ert$ rihts
un6ustl$ taken& It also !iolated the e?ual (rotection
clause #$ lum(in toether all secured and unsecured
creditors& It also im(aired the o#liation of contracts,
e!en thouh it onl$ in!ol!ed (urel$ (ri!ate interests&
4. -RS Business Cor'oration vs. I!'erial
Insurance
F'")S: 4&.&S& %usiness "or(oration, an
esta#lishment dul$ franchised #$ the "onress of the
Phili((ines, to conduct a messener and deli!er$
e3(ress ser!ice& )he res(ondent Im(erial Insurance,
Inc&, (resented with the "FI of Manila a com(laint for
sum of mone$ aainst the (etitioner cor(oration& 'fter
the defendants therein ha!e su#mitted their 'nswer,
the (arties entered into a "om(romise 'reement,
assisted #$ their res(ecti!e counsels& )he lower court
rendered 6udment em#od$in the contents of the
said com(romise areement&
,ne da$ after the date fi3ed in the com(romise
areement, within which the 6udment de#t would #e
(aid, #ut was not, res(ondent Im(erial Insurance Inc&,
filed a AMotion for the Insurance of a +rit of
23ecutionA& ' +rit of 23ecution was issued #$
res(ondent Sheriff, Notices of Sale were sent out for
the auction of the (ersonal (ro(erties of the (etitioner
4&.&S& %usiness "or(oration& a Notice of Sale of the
Awhole ca(ital stocks of the defendants 4.S %usiness
"or(oration, the #usiness name, riht of o(eration,
the whole assets, furnitures and e?ui(ments, the total
lia#ilities, and Net +orth, #ooks of accounts, etc&,
etc&A of the (etitioner cor(oration was, handed down&
Petitioner, thru counsel, (resented an A-rent Petition
for Post(onement of 'uction Sale and for .elease of
*e!$ on the %usiness Name and .iht to ,(erate of
5efendant 4.S %usiness "or(orationA, statin that
(etitioners were #us$ neotiatin for a loan with which
to (a$ the 6udment de#t; that the 6udment was for
mone$ onl$ and, therefore, (laintiff Bres(ondent
Insurance "om(an$C was not authori7ed to take o!er
and a((ro(riate for its own use, the #usiness name of
the defendants; that the riht to o(erate under the
franchise, was not transfera#le and could not #e
considered a (ersonal or immo!a#le, (ro(ert$,
su#6ect to le!$ and sale&
In the sale which was conducted in the (remises of
the 4.S %usiness "or(oration, all the (ro(erties of
said cor(oration contained in the Notices of Sale,
were #ouht #$ res(ondent Im(erial Insurance, Inc&
ISS-2: +,N the #usiness name or trade name,
franchise Briht to o(erateC and ca(ital stocks of the
(etitioner are (ro(erties or (ro(ert$ rihts which could
#e the su#6ect of le!$, e3ecution and sale&
/2*5: Sec& 86 of the "or(oration *aw (ro!ides:
Any franchise granted to a corporation to collect tolls
or to occupy, enoy, or use public property or any
portion of the public domain or any right of way over
public property or the public domain, and any rights
and privileges ac!uired under such franchise may be
levied upon and sold under e"ecution, together with
the property necessary for the enoyment, the
e"ercise of the powers, and the receipt of the
proceeds of such franchise or right of way, in the
same manner and with li#e effect as any other
property to satisfy any udgment against the
corporation$ Provided, %hat the sale of the franchise
or right of way and the property necessary for the
enoyment, the e"ercise of the powers, and the
receipt of the proceeds of said franchise or right of
way is especially decreed and ordered in the
udgment$ And provided, further, %hat the sale shall
not become effective until confirmed by the court after
due notice.
' franchise is a s(ecial (ri!ilee conferred #$
o!ernmental authorit$, and which does not #elon to
citi7ens of the countr$ enerall$ as a matter of
common riht& Its meanin de(ends more or less
u(on the connection in which the word is em(lo$ed
and the (ro(ert$ and cor(oration to which it is
a((lied& It ma$ ha!e different sinifications&
AFor (ractical (ur(oses, franchises, so far as relatin
to cor(orations, are di!isi#le into B1C cor(orate or
eneral franchises; and BDC s(ecial or secondar$
franchises& )he former is the franchise to e3ist as a
cor(oration, while the latter are certain rihts and
(ri!ilees conferred u(on e3istin cor(orations, such
as the riht to use the streets of a munici(alit$ to la$
(i(es or tracks, erect (oles or strin wires&A
)he (rimar$ franchise of a cor(oration that is, the
riht to e3ist as such, is !ested Ain the indi!iduals who
com(ose the cor(oration and not in the cor(oration
itselfA #ut the s(ecif$ or secondar$ franchises of a
cor(oration are !ested in the cor(oration and ma$
ordinaril$ #e con!e$ed or mortaed under a eneral
(ower ranted to a cor(oration to dis(ose of its
(ro(ert$, e3ce(t such s(ecial or secondar$ franchises
as are chared with a (u#lic use
)he riht to o(erate a messener and e3(ress
deli!er$ ser!ice, #$ !irtue of a leislati!e enactment,
is admittedl$ a secondar$ franchise, and, as such,
under our cor(oration law, is su#6ect to le!$ and sale
on e3ecution toether and includin all the (ro(ert$
necessar$ for the en6o$ment thereof& )he law,
howe!er, indicates the (rocedure under which the
same Bsecondar$ franchise and the (ro(erties
necessar$ for its en6o$mentC ma$ #e sold under
e3ecution& Said franchise can #e sold under
e3ecution, when such sale is es(eciall$ decreed and
ordered in the 6udment and it #ecomes effecti!e onl$
when the sale is confirmed #$ the "ourt after due
D
notice& )he com(romise areement and the 6udment
#ased thereon, do not contain an$ s(ecial decree or
order makin the franchise answera#le for the
6udment de#t& )he same thin ma$ #e stated with
res(ect to (etitionerEs trade name or #usiness name
and its ca(ital stock& Incidentall$, the trade name or
#usiness name corres(onds to the initials of the
President of the (etitioner cor(oration and there can
#e no serious dis(ute reardin the fact that a trade
name or #usiness name and ca(ital stock are
necessaril$ included in the en6o$ment of the
franchise& *ike that of a franchise, the law mandates,
that (ro(ert$ necessar$ for the en6o$ment of said
franchise, can onl$ #e sold to satisf$ a 6udment de#t
if the decision es(eciall$ so (ro!ides& 's +e ha!e
stated heretofore, no such directi!e a((ears in the
decision& Moreo!er, a trade name or #usiness name
cannot #e sold se(aratel$ from the franchise, and the
ca(ital stock of the (etitioner cor(oration or an$ other
cor(oration, for the matter, re(resents the interest and
is the (ro(ert$ of stockholders in the cor(oration, who
can onl$ #e de(ri!ed thereof in the manner (ro!ided
#$ law
.. Tuason v. Bolanos
Facts: )his is an a((eal in the decision of the "ourt of
Fuist Instance of .i7al reardin the action #rouht #$
the (laintiff, )uason as re(resented #$ its manain
(artner Freorio 'raneta (f 'raneta and 'raneta to
reco!er (ossession of reistered land situated in
#arrio )atalon Gue7on "it$&
)he (laintiff a((ellee in this case contends
that the case was not #rouht #$ the real (art$ in
interest which is 4M )uason and "o& Inc& #ecause the
com(laint was sined #$ Freorio 'raneta, Inc& its
manain (artner& It also claims that Freorio
'raneta Inc& cannot act as manain (artner of
(laintiff on theor$ that it is illeal for two cor(orations
to enter into a (artnershi(&

Issue: +hether or not the contention of the (laintiff
a((ellee reardin the real (art$ in interest is correct@
/eld: It is true that the com(laint also states that the
(laintiff is Are(resented herein #$ its Manain
Partner Freorio 'raneta, Inc&A, another cor(oration,
#ut there is nothin aainst one cor(oration #ein
re(resented #$ another (erson, natural or 6uridical, in
a suit in court&
)he contention that Freorio 'raneta, Inc& can not act
as manain (artner for (laintiff on the theor$ that it is
illeal for two cor(orations to enter into a (artnershi(
is without merit, for the true rule is that Athouh a
cor(oration has no (ower to enter into a (artnershi(,
it ma$ ne!ertheless enter into a 6oint !enture with
another where the nature of that !enture is in line with
the #usiness authori7ed #$ its charter&A
It is true that the com(laint also states that the (laintiff
is Are(resented herein #$ its Manain Partner
Freorio 'raneta, Inc&A, another cor(oration, #ut there
is nothin aainst one cor(oration #ein re(resented
#$ another (erson, natural or 6uridical, in a suit in
court& )he contention that Freorio 'raneta, Inc& can
not act as manain (artner for (laintiff on the theor$
that it is illeal for two cor(orations to enter into a
(artnershi( is without merit, for the true rule is that
Athouh a cor(oration has no (ower to enter into a
(artnershi(, it ma$ ne!ertheless enter into a 6oint
!enture with another where the nature of that !enture
is in line with the #usiness authori7ed #$ its charter&A
6& A/RBAC$ +S. SANITAR0 1AR2S
3AN/"ACT/RIN4 C5RP5RATI5N
"ACTS#
In 1961, Saniwares, a domestic cor(oration
was incor(orated for the (rimar$ (ur(ose of
manufacturin and marketin sanitar$ wares& ,ne of
the incor(orators, Mr& %aldwin Youn went a#road to
look for forein (artners, 2uro(ean or 'merican who
could hel( in its e3(ansion (lans& ,n 'uust 18,
196D, 'SI, a forein cor(oration domiciled in
5elaware, -nited States entered into an 'reement
with Saniwares and some Fili(ino in!estors where#$
'SI and the Fili(ino in!estors areed to (artici(ate in
the ownershi( of an enter(rise which would enae
(rimaril$ in the #usiness of manufacturin in the
Phili((ines and sellin here and a#road !itreous china
and sanitar$ wares& )he (arties areed that the
#usiness o(erations in the Phili((ines shall #e carried
on #$ an incor(orated enter(rise and that the name of
the cor(oration shall initiall$ #e ASanitar$ +ares
Manufacturin "or(oration&A
't the re?uest of 'SI, the areement
contained (ro!isions desined to (rotect it as a
minorit$ rou(, includin the rant of !eto (owers
o!er a num#er of cor(orate acts and the riht to
desinate certain officers, such as a mem#er of the
23ecuti!e "ommittee whose !ote was re?uired for
im(ortant cor(orate transactions&
*ater, the H0I ca(ital stock of 'SI was
increased to 90I& )he cor(oration was also
reistered with the %oard of In!estments for a!ailment
of incenti!es with the condition that at least 60I of
the ca(ital stock of the cor(oration shall #e owned #$
Phili((ine nationals&
H
)he 6oint enter(rise thus entered into #$ the
Fili(ino in!estors and the 'merican cor(oration
(ros(ered& -nfortunatel$, with the #usiness
successes, there came a deterioration of the initiall$
harmonious relations #etween the two rou(s&
'ccordin to the Fili(ino rou(, a #asic disareement
was due to their desire to e3(and the e3(ort
o(erations of the com(an$ to which 'SI o#6ected as it
a((arentl$ had other su#sidiaries of 6oint 6oint !enture
rou(s in the countries where Phili((ine e3(orts were
contem(lated& ,n March :, 19:H, the annual
stockholdersE meetin was held& )he meetin was
(resided #$ %aldwin Youn& )he minutes were taken
#$ the Secretar$, '!elino "ru7& 'fter dis(osin of the
(reliminar$ items in the aenda, the stockholders then
(roceeded to the election of the mem#ers of the
#oard of directors& )he 'SI rou( nominated three
(ersons namel$; +olfan 'ur#ach, 4ohn Friffin and
5a!id P& +hittinham& )he Phili((ine in!estors
nominated si3, namel$; 2rnesto *adameo, Sr&, .aul
'& %oncan, 2rnesto .& *adameo, 4r&, Feore F& *ee,
and %aldwin Youn& Mr& 2duardo ., "eni7a then
nominated Mr& *uciano 2& Sala7ar, who in turn
nominated Mr& "harles "hamsa$& )he chairman,
%aldwin Youn ruled the last two nominations out of
order on the #asis of section 8 BaC of the 'reement,
the consistent (ractice of the (arties durin the (ast
annual stockholdersE meetins to nominate onl$ nine
(ersons as nominees for the nine=mem#er #oard of
directors, and the leal ad!ice of SaniwaresE leal
counsel&
ISS/2#
+/2)/2. ,. N,) )/2 P'.)I2S ), '
P'.)I"-*'. ",N).'") /'J2 )/2.2%Y
2S)'%*IS/25 'M,NF )/2MS2*J2S ' -5INT
+2NT/R2@
R/6IN4#
)he rule is that whether the (arties to a
(articular contract ha!e there#$ esta#lished amon
themsel!es a 6oint !enture or some other relation
de(ends u(on their actual intention which is
determined in accordance with the rules o!ernin
the inter(retation and construction of contracts& In the
instant cases, our e3amination of im(ortant (ro!isions
of the 'reement as well as the testimonial e!idence
(resented #$ the *adameo and Youn Frou( shows
that the (arties areed to esta#lish a 6oint !enture and
not a cor(oration& )he histor$ of the orani7ation of
Saniwares and the unusual arranements which
o!ern its (olic$ makin #od$ are all consistent with a
6oint !enture and not with an ordinar$ cor(oration&
Premises considered, we #elie!e that under the
'reement there are two rou(s of stockholders who
esta#lished a cor(oration with (ro!isions for a s(ecial
contractual relationshi( #etween the (arties, i&e&, 'SI
and the other stockholders& B((& 9=8C
Section 8 BaC of the areement uses the word
AdesinatedA and not AnominatedA or AelectedA in the
selection of the nine directors on a si3 to three ratio&
2ach rou( is assured of a fi3ed num#er of directors
in the #oard&
Moreo!er, 'SI in its communications referred to the
enter(rise as 6oint !enture& %aldwin Youn also
testified that Section 16BcC of the 'reement that
ANothin herein contained shall #e construed to
constitute an$ of the (arties hereto (artners or 6oint
!enturers in res(ect of an$ transaction hereunderA
was merel$ to o#!iate the (ossi#ilit$ of the enter(rise
#ein treated as (artnershi( for ta3 (ur(oses and
lia#ilities to third (arties&
>& S3IT$7 B266 & C5. vs NATI+I&A& 83alcol!7 -.9
4: P*il 1%67 144;14. 81<1<9
Facts:
Smith, %ell K "o& is a cor(oration orani7ed and
e3istin under the laws of the Phili((ine Islands;
ma6orit$ of the stockholders are %ritish; owner of a
motor !essel known as the %atoL#rouht to
"e#u for the (ur(ose of trans(ortin Smith, %ell K
"o&Ms merchandise #etween (orts in the
islands&
=a((lication for reistration was made at "e#u at the
"ollector of "ustoms===denied& %ecause
the$ were not citi7ens of the -S<Phils&
='ct D6>1, Sec& 11>D& "ertificate ofPhili((ine
.eister&u(on reistration of a !essel of domestic
ownershi(, and of more than 18 tons ross, a
certificate of Phili((ine reister shall #e issued for it& If
the !essel is of domestic ownershi( and of 18 tons
ross or less, the takin of the certificate of Phili((ine
reister shall #e o(tional with the owner&
=domestic ownershi(, as used in this section, means
ownershi( !ested in the BaC citi7ens or
nati!e inha#itants of the Phil Islands; B#C citi7ens of
the -S residin in the Phil& Islands; BcC an$
cor(oration or com(an$ com(osed wholl$ of citi7en of
Phils&<-S or #oth
=(laintiffMs contention: 'ct No& D6>1 de(ri!es the cor(&
of its (ro(ert$ without due (rocess of law #ecause #$
the (assae of the law, the com(an$ was
automaticall$ de(ri!ed of e!er$ #eneficial attri#ute of
ownershi( of the %ato and that the$ are left with a
naked title the$ could not use&
Issue: +,N Smith, %ell K "o& were denied of the due
(rocess of law #$ the Phil& *eislature in its
enactment of 'ct D>61&
9
.ulin: No& B6udment affirmedL(laintiff canMt #e
ranted reistr$&C
.5: 'ct No& D>61, in den$in to cor(orations such as
Smith, %ell K "o& *td&, the riht to reister
!essels in the Phils& "oastwide trade, falls within the
authori7ed e3ce(tions& S(ecificall$ within
the (ur!iew of the (olice (ower& *iterall$ and
a#solutel$, steamshi( lines are the arteries of the
commerce in the Phils& If one #e se!ered, the
life#lood of the nation is lost& If these are
(rotected, securit$ of the countr$ and eneral welfare
is sustained&
:& Stone*ill vs. &io,no
"acts# -(on a((lication of the officers of the
o!ernment BS(ecial ProsecutorsC 4udes of "FI and
Munici(al "ourts issued, on different dates, a total of
9D search warrants aainst /arr$ S& Stonehill et& 'l
and<or the cor(orations of which the$ were officers,
directed to an$ (eace officer, to search the said
(ersons and<or the (remises of their offices,
warehouses and<or residences, and to sei7e and take
(ossession of the followin (ersonal (ro(ert$ to wit:
0%ooks of accounts, financial records, !ouchers,
corres(ondence, recei(ts, leders, 6ournals,
(ortfolios, credit 6ournals, t$(ewriters, and other
documents and<or (a(ers showin all #usiness
transactions includin dis#ursements recei(ts,
#alance sheets and (rofit and loss statements and
%o##ins Bciarette wra((ersC1 as 0the su#6ect of the
offense; stolen or em#e77led and (roceeds or fruits of
the offense,1 or 0used or intended to #e used as the
means of committin the offense,1 which is descri#ed
in the a((lications ad!erted to a#o!e as 0!iolation of
"entral %ank *aws, )ariff and "ustoms *aws, Internal
.e!enue B"odeC and the .e!ised Penal "ode&1
'llein that the search warrants are null and !oid, as
contra!enin the "onstitution and the .ules of "ourt,
Stonehill, et& al& filed with the Su(reme "ourt the
oriinal action for certiorari, (rohi#ition, mandamus
and in6unction& ,n DD March 196D, the Su(reme
"ourt issued the writ of (reliminar$ in6unction (ra$ed
for in the (etition& /owe!er, #$ resolution dated D9
4une 196D, the writ was (artiall$ lifted or dissol!ed,
insofar as the (a(ers, documents and thins sei7ed
from the offices of the cor(orations are concerned;
#ut, the in6unction was maintained as reards the
(a(ers, documents and thins found and sei7ed in
the residences of Stonehill, et& al&
Issue# +,N the search warrants issued were !alid&
$eld# )he "ourt held that the warrants for the search
of H residences are null and !oid since it is in the
nature of eneral warrant; )he re?uisites (ro!ided #$
the .ules of "ourt was not met&
9& Bac*e and Co!'any vs. Rui=
%> SCRA ?2%
"ACTS# .es(ondent "ommissioner of the Internal
.e!enue wrote a re?uest letter for the
issuance of a search warrant #$ the
.es(ondent 4ude aainst (etitioner
cor(oration for the alleed !iolation of Sec&
96BaC of the NI.", in relation to Sections 8H,
>D, >H, D0: and D09, and authori7in
.e!enue 23aminer 5e *eon to make and file
the a((lication for search warrant&
In the followin da$, 5e *eon and his
witness went to court and #rouht with them
an a((lication for warrant of arrest #ut still
unsined #$ him, an affida!it and de(osition
of the witness and a search warrant alread$
accom(lished #ut still not sined #$ the
4ude& 't that time, res(ondent 4ude was
still in a hearin, thus, he 6ust instructed his
5e(ut$ "lerk to take the de(ositions of 5e
*eon and the witness& 'fter the hearin, the
4ude was informed that the de(osition had
alread$ #een taken& )he 4ude re?uested
that the stenora(hic notes #e read aloud to
him and thereafter he asked the witness to
take his oath and warned him that he can #e
held lia#le for (er6ur$ if his de(osition was
found to #e false and without leal #asis&
.es(ondent sined 5e *eonMs a((lication
and the witness de(osition and a
corres(ondin Search +arrant was issued&
)hree da$s later, %I. aents ser!ed the
warrant on PetitionerMs office& )he latter filed
with the issuin court a (etition to ?uash said
warrant #ut was denied& )hus, a (etition to
the Su(reme "ourt to declare null and !oid
the search warrant issued aainst them #$
the res(ondent 4ude was filed&
ISS/2# +hether or not the search warrant is !alid&
$26&# )he search warrant is in!alid&
)he 4ude failed to (ersonall$ e3amine the
com(lainant and the witness as re?uired #$
the "onstitution& )he "onstitution (ro!ides:
&'ection (. %he
right of the people to be
secure in their persons,
houses, papers, and
effects against
unreasonable searches
and seizures of whatever
nature and whatever
purpose shall not be
violated, and no search
warrant or warrant of
arrest shall issue e"cept
upon probable cause to be
determined by the udge,
or such other responsible
8
officer as maybe
authorized by law, after
e"amination under oath or
affirmation of the
complainant and the
witnesses he may
produce, and particularly
describing the place to be
searched, and the persons
or things to be seized.)
)he e3amination of the com(lainant and
witnesses should #e conducted #$ the 6ude
himself and not #$ others& Personal
e3amination #$ the 4ude of the com(lainant
and his witnesses is necessar$ to determine
whether or not (ro#a#le cause e3ists& In the
case at #ar, the (artici(ation of the 4ude
was limited onl$ to listenin to the
stenora(herMs readin of her notes and 6ust
i!in a warnin to the witness& )his cannot
#e considered (ersonal e3amination&
Furthermore, the search warrant is in!alid
#ecause it is a eneral warrant& It does not
conform to the re?uirement that a search
warrant shall (articularl$ descri#e the (erson
or thins to #e sei7ed& Such warrant should
ha!e at least mentioned the dates, amounts,
(ersons, etc& /owe!er, such (ertinent data
was not issued in the challened warrant&
1:. Bataan S*i'yard vs PC44 84R >.??.7 3ay 2>7
1<?>9
Facts:
Pursuant to the 23ecuti!e ,rder No& 1 and D
(romulated #$ President '?uino, the P"FF was
ordered to reco!er ill=otten wealth amassed #$
former President Marcos, his relati!es, cronies and
associates, which were o#tained throuh the use of
(u#lic funds& "onse?uentl$, the Presidential
"ommission on Food Fo!ernment issued a
se?uestration order aainst (etitioner %'S2",&
Incidental to this, the (etitioner was ordered to
(roduce its cor(orate records from 19>H to 19:6& In
assailin this order, (etitioner contended that this
!iolates its constitutional riht aainst self=
incrimination&
Issue:
Is a cor(oration entitled to the riht aainst self=
incrimination afforded to indi!iduals #$ the
"onstitution@
/eld:
)he "ourt held in the neati!e& )he "ourt found that
%'S2", was owned #$ President Marcos throuh
the use of dummies and alter eos, most nota#le
e!idence #ein the reco!er$ of the deed of
assinments of shares in the com(an$ in the
MalacaNan after the fliht of the Marcoses& It was
the rulin of the "ourt that the riht aainst self=
incrimination has no a((lication to 6uridical (erson& In
addition, an officer of a com(an$ cannot refuse the
(roduction of records on the round of it incriminatin
him or the com(an$& )he "ourt ?uoted the rulin of
+ilson !s& -S, to the effect that the cor(oration is a
mere creature of the state& )his #ein so, there is a
reser!ation to the leislature to in!estiate its
contracts and find out whether it has e3ceeded its
(owers& )he "ourt also held that there was no
!iolation of its riht aainst unlawful search and
sei7ure since no search or sei7ure took (lace&
11. National Coal Co. v. CIR
Facts: )he National "oal "o&BN""C was created #$
a s(ecial law and was enacted #$ !irtue of 'ct D>08
in order to de!elo( a coal industr$& It was enaed in
coal minin on reser!ed lands #elonin to the
o!ernment&
)he National "oal "o&BN""C filed a case aainst the
"I. for the reco!er$ of sum of mone$ it (aid on
(rotest as s(ecific ta3 on D9,0:9 tons of coals
claimin e3em(tion to ta3 (ursuant to Sec& 19 and 18
of 'ct D>19&
Issue: +hether or not N"" is a (ri!ate cor(oration@
/eld: Plaintiff is a (ri!ate cor(oration& )he mere fact
that the o!ernment is a ma6orit$ stockholder of the
cor(oration does not make the cor(oration& 'ct D>08
as amended #$ 'ct D:DD makes it su#6ect to all the
(ro!ision of the cor(oration law&
's a (ri!ate cor(oration, it has no reater
rihts, (owers or (ri!ilees than an$ other cor(oration
which ma$ #e orani7ed for the same (ur(ose under
the cor(oration law and certainl$ it was not the
intention of the leislature to i!e (reference or riht
or (ri!ilee o!er other leitimate (ri!ate cor(oration in
the minin of coal&
N"" is re?uired to (a$ ta3es (ursuant to
Section 1996 of the 'dministrati!e "ode& Moreo!er,
'ct D>19 is a((lica#le onl$ to lessee or owner of coal
#earin lands which N"" is not&
1D& &A+A5 CIT0 1AT2R &ISTRICT +S. CI+I6
S2R+IC2 C533ISSI5N
"ACTS#
Petitioners are amon the more than fi!e
hundred B800C water districts e3istin throuhout the
countr$ formed (ursuant to the (ro!isions of
6
Presidential 5ecree No& 19:, as amended #$
Presidential 5ecrees Nos& >6: and 19>9, otherwise
known as the APro!incial +ater -tilities 'ct of 19>H&A
Presidential 5ecree No& 19: was issued #$
the then President Ferdinand 2& Marcos #$ !irtue of
his leislati!e (ower under Proclamation No& 10:1& It
authori7ed the different local leislati!e #odies to form
and create their res(ecti!e water districts throuh a
resolution the$ will (ass su#6ect to the uidelines,
rules and reulations therein laid down& )he decree
further created and formed the A*ocal +ater -tilities
'dministrationA B*+-'C, a national aenc$ attached
to the National 2conomic and 5e!elo(ment 'uthorit$
BN25'C, and ranted with reulator$ (ower necessar$
to o(timi7e (u#lic ser!ice from water utilities
o(erations&
ISS/2#
+/2)/2. ,. N,) )/2 *,"'* +')2.
5IS).I")S F,.M25 'N5 ".2')25 P-.S-'N)
), )/2 PR5+ISI5NS 5" P.&. 1<?7 AS A32N&2&7
'.2 F,J2.NM2N)=,+N25 ,. ",N).,**25
",.P,.')I,NS +I)/ ,.IFIN'* "/'.)2.
F'**INF -N52. )/2 "IJI* S2.JI"2 *'+
'N5<,. ",J2.25 %Y )/2 JISI),.I'* P,+2.
,F )/2 ",MMISSI,N ,N '-5I)@
R/6IN4#
'fter a fair consideration of the (artiesE
aruments cou(led with a careful stud$ of the
a((lica#le laws as well as the constitutional
(ro!isions in!ol!ed, +e rule aainst the (etitioners
and reiterate ,ur rulin in )an6a$ case declarin
water districts o!ernment=owned or controlled
cor(orations with oriinal charter&
'scertained from a consideration of the
whole statute, P5 19: is a s(ecial law a((lica#le onl$
to the different water districts created (ursuant
thereto& In all its essential terms, it is o#!ious that it
(ertains to a s(ecial (ur(ose which is intended to
meet a (articular set of conditions and
cirmcumstances& )he fact that said decree enerall$
a((lies to all water districts throuhout the countr$
does not chane the fact that P5 19: is a s(ecial law&
'ccordinl$, this "ourtEs resolution in Metro Iloilo case
declarin P5 19: as a eneral leislation is here#$
a#andoned&
%$ Ao!ernment=owned or controlled
cor(oration with oriinal charter,A +e mean
o!ernment owned or controlled cor(oration created
#$ a s(ecial law and not under the "or(oration "ode
of the Phili((ines&
From the foreoin (ronouncement, it is
clear that what has #een e3cluded from the co!erae
of the "S" are those cor(orations created (ursuant
to the "or(oration "ode& Sinificantl$, (etitioners are
not created under the said code, #ut on the contrar$,
the$ were created (ursuant to a s(ecial law and are
o!erned (rimaril$ #$ its (ro!ision&
)he (ro!isions of P5 19:, as amended, are
similar to those which are actuall$ contained in other
cor(orate charters& )he conclusion is inesca(a#le that
the said decree is in truth and in fact the charter of the
different water districts for it clearl$ defines the latterEs
(rimar$ (ur(ose and its #asic orani7ational set=u(&
In other words, P5 19:, as amended, is the !er$ law
which i!es a water district 6uridical (ersonalit$& +hile
it is true that a resolution of a local sanunian is still
necessar$ for the final creation of a district, this "ourt
is of the o(inion that said resolution cannot #e
considered as its charter, the same #ein intended
onl$ to im(lement the (ro!isions of said decree&
>