G.R. No.

L-22734

September 15, 1967

COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. MANUEL B. PINEDA, as one of the heirs of deceased ATANASIO PINEDA, respondent. On May 23, 1945 Atanasio Pineda died, survived by his wife, Felicisima Bagtas, and 15 children, the eldest of whom is Manuel B. Pineda, a lawyer. Estate proceedings were had in the Court of First Instance of Manila (Case No. 71129) wherein the surviving widow was appointed administratrix. The estate was divided among and awarded to the heirs and the proceedings terminated on June 8, 1948. Manuel B. Pineda's share amounted to about P2,500.00. After the estate proceedings were closed, the Bureau of Internal Revenue investigated the income tax liability of the estate for the years 1945, 1946, 1947 and 1948 and it found that the corresponding income tax returns were not filed. Thereupon, the representative of the Collector of Internal Revenue filed said returns for the estate on the basis of information and data obtained from the aforesaid estate proceedings and issued an assessment for the following: 1. Deficiency income 1945 P135.83 1946 436.95 1947 1,206.91 Add: 5% surcharge 1% monthly interest from November 30, 1953 to April 15, 1957 Compromise for late filing Compromise for late payment Total amount due 2.

P1,779.69 88.98

720.77 80.00 40.00 P2,707.44 =========== P14.50 ===========

Additional residence tax for 1945 3. Real Estate dealer's tax for the fourth quarter of 1946 and the P207.50 whole year of 1947 ===========

Manuel B. Pineda, who received the assessment, contested the same. Subsequently, he appealed to the Court of Tax Appeals alleging that he was appealing "only that proportionate part or portion pertaining to him as one of the heirs." After hearing the parties, the Court of Tax Appeals rendered judgment reversing the decision of the Commissioner on the ground that his right to assess and collect the tax has prescribed. The Commissioner appealed and this Court affirmed the findings of the Tax Court in respect to the assessment for income tax for the year 1947 but held that the right to assess and collect the taxes for 1945 and 1946 has not prescribed. For 1945 and 1946 the returns were filed on August 24, 1953; assessments for both taxable years were made within five years therefrom or on October 19, 1953; and the action to collect the tax was filed within five years from the latter date, on August 7, 1957. For taxable year 1947, however, the return was filed on March 1, 1948; the assessment was made on October 19, 1953, more than five years from the date the return was filed; hence, the right to assess income tax for 1947 had 1 prescribed. Accordingly, We remanded the case to the Tax Court for further appropriate proceedings. In the Tax Court, the parties submitted the case for decision without additional evidence. On November 29, 1963 the Court of Tax Appeals rendered judgment holding Manuel B. Pineda liable for the payment corresponding to his share of the following taxes: Deficiency income tax 1945 1946 P135.8 3 436.95

Real estate dealer's fixed tax 4th quarter of 1946 and whole year of 1947 P187.50 The Commissioner of Internal Revenue has appealed to Us and has proposed to hold Manuel B. Pineda liable for the payment of all the taxes found by the Tax Court to be due from the estate in the total amount of P760.28 instead of only for the amount of taxes corresponding to his share in the estate. 1awphîl.nèt Manuel B. Pineda opposes the proposition on the ground that as an heir he is liable for unpaid income tax due the estate only up to the extent of and in proportion to any share he received. He relies on Government of the 2 Philippine Islands v. Pamintuan where We held that "after the partition of an estate, heirs and distributees are liable individually for the payment of all lawful outstanding claims against the estate in proportion to the amount or value of the property they have respectively received from the estate." We hold that the Government can require Manuel B. Pineda to pay the full amount of the taxes assessed. Pineda is liable for the assessment as an heir and as a holder-transferee of property belonging to the estate/taxpayer. As an heir he is individually answerable for the part of the tax proportionate to the share he received 3 4 from the inheritance. His liability, however, cannot exceed the amount of his share. As a holder of property belonging to the estate, Pineda is liable for he tax up to the amount of the property in his possession. The reason is that the Government has a lien on the P2,500.00 received by him from the estate as his 4a share in the inheritance, for unpaid income taxes for which said estate is liable, pursuant to the last paragraph of Section 315 of the Tax Code, which we quote hereunder: If any person, corporation, partnership, joint-account (cuenta en participacion), association, or insurance company liable to pay the income tax, neglects or refuses to pay the same after demand, the amount shall be a lien in favor of the Government of the Philippines from the time when the assessment was made by the Commissioner of Internal Revenue until paid with interest, penalties, and costs that may accrue in addition thereto upon all property and rights to property belonging to the taxpayer: . . . By virtue of such lien, the Government has the right to subject the property in Pineda's possession, i.e., the P2,500.00, to satisfy the income tax assessment in the sum of P760.28. After such payment, Pineda will have a right 5 of contribution from his co-heirs, to achieve an adjustment of the proper share of each heir in the distributable estate. All told, the Government has two ways of collecting the tax in question. One, by going after all the heirs and collecting from each one of them the amount of the tax proportionate to the inheritance received. This remedy was adopted in Government of the Philippine Islands v. Pamintuan , supra. In said case, the Government filed an action against all the heirs for the collection of the tax. This action rests on the concept that hereditary property consists only of that part which remains after the settlement of all lawful claims against the estate, for the settlement of which the 6 entire estate is first liable. The reason why in case suit is filed against all the heirs the tax due from the estate is levied proportionately against them is to achieve thereby two results: first, payment of the tax; and second, adjustment of the shares of each heir in the distributed estate as lessened by the tax. Another remedy, pursuant to the lien created by Section 315 of the Tax Code upon all property and rights to property belonging to the taxpayer for unpaid income tax, is by subjecting said property of the estate which is in the hands of an heir or transferee to the payment of the tax due, the estate. This second remedy is the very avenue the Government took in this case to collect the tax. The Bureau of Internal Revenue should be given, in instances like the case at bar, the necessary discretion to avail itself of the most expeditious way to collect the tax as may be envisioned in the particular provision of the Tax Code above quoted, because taxes are the lifeblood of government and their 7 prompt and certain availability is an imperious need. And as afore-stated in this case the suit seeks to achieve only one objective: payment of the tax. The adjustment of the respective shares due to the heirs from the inheritance, as lessened by the tax, is left to await the suit for contribution by the heir from whom the Government recovered said tax. WHEREFORE, the decision appealed from is modified. Manuel B. Pineda is hereby ordered to pay to the Commissioner of Internal Revenue the sum of P760.28 as deficiency income tax for 1945 and 1946, and real estate dealer's fixed tax for the fourth quarter of 1946 and for the whole year 1947, without prejudice to his right of contribution for his co-heirs. No costs. So ordered. Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Angeles and Fernando, JJ., concur.

G.R. No. L-19495

November 24, 1966

COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. LILIA YUSAY GONZALES and THE COURT OF TAX APPEALS, respondents. Matias Yusay, a resident of Pototan, Iloilo, died intestate on May 13, 1948, leaving two heirs, namely, Jose S. Yusay, a legitimate child, and Lilia Yusay Gonzales, an acknowledged natural child. Intestate proceedings for the settlement of his estate were instituted in the Court of First Instance of Iloilo (Special Proceedings No. 459). Jose S. Yusay was therein appointed administrator. On May 11, 1949 Jose S. Yusay filed with the Bureau of Internal Revenue an estate and inheritance tax return declaring therein the following properties: Personal properties Palay Carabaos Real properties: Capital, 74 parcels ) Conjugal 19 parcels) Total gross estate The return mentioned no heir. Upon investigation however the Bureau of Internal Revenue found the following properties: Personal properties: Palay Carabaos Packard Automobile 2 Aparadors Real properties: Capital, 25 parcels assessed at 1/2 of Conjugal, 130 parcels assessed at Total P6,444.00 1,500.00 2,000.00 500.00 P87,715.32 P121,425.00 P209,140.32 P219,584.32 assessed at P179,760.00 P187,204.00 P6,444.00 1,000.00 P7,444.00

P10,444.00

The fair market value of the real properties was computed by increasing the assessed value by forty percent. Based on the above findings, the Bureau of Internal Revenue assessed on October 29, 1953 estate and inheritance taxes in the sums of P6,849.78 and P16,970.63, respectively. On January 25, 1955 the Bureau of Internal Revenue increased the assessment to P8,225.89 as estate tax and P22,117.10 as inheritance tax plus delinquency interest and demanded payment thereof on or before February 28, 1955. Meanwhile, on February 16, 1955, the Court of First Instance of Iloilo required Jose S. Yusay to show proof of payment of said estate and inheritance taxes. On March 3, 1955 Jose S. Yusay requested an extension of time within which to pay the tax. He posted a surety bond to guarantee payment of the taxes in question within one year. The Commissioner of Internal Revenue however denied the request. Then he issued a warrant of distraint and levy which he transmitted to the Municipal Treasurer of Pototan for execution. This warrant was not enforced because all the personal properties subject to distraint were located in Iloilo City. On May 20, 1955 the Provincial Treasurer of Iloilo requested the BIR Provincial Revenue Officer to furnish him copies of the assessment notices to support a motion for payment of taxes which the Provincial Fiscal would file in Special

Proceedings No. 459 before the Court of First Instance of Iloilo. The papers requested were sent by the Commissioner of Internal Revenue to the Provincial Revenue Officer of Iloilo to be transmitted to the Provincial Treasurer. The records do not however show whether the Provincial Fiscal filed a claim with the Court of First Instance for the taxes due. On May 30, 1956 the commissioner appointed by the Court of First Instance for the purpose, submitted a reamended project of partition which listed the following properties: Personal properties: Buick Sedan Packard car Aparadors Cash in Bank (PNB) Palay Carabaos Real properties: Land, 174 parcels assessed at Buildings Total P324,797.21 4,500.00 P8,100.00 2,000.00 500.00 8,858.46 6,444.00 1,500.00

P27,402.46

P329,297.21 P356,699.67

More than a year later, particularly on July 12, 1957, an agent of the Bureau of Internal Revenue apprised the Commissioner of Internal Revenue of the existence of said reamended project of partition. Whereupon, the Internal Revenue Commissioner caused the estate of Matias Yusay to be reinvestigated for estate and inheritance tax liability. Accordingly, on February 13, 1958 he issued the following assessment: Estate tax 5% surcharge Delinquency interest Compromise No notice of death Late payment Total Inheritance Tax 5% surcharge Delinquency interest Compromise for late payment Total Total estate and inheritance taxes P15.00 40.00 P16,246.04 411.29 11,868.90

55.00 P28,581.23 P38,178.12 1,105.86 28,808.75 50.00 P69,142.73 P97,723.96

Like in previous assessments, the fair market value of the real properties was arrived at by adding 40% to the assessed value. In view of the demise of Jose S. Yusay, said assessment was sent to his widow, Mrs. Florencia Piccio Vda. de Yusay, who succeeded him in the administration of the estate of Matias Yusay. No payment having been made despite repeated demands, the Commissioner of Internal Revenue filed a proof of claim for the estate and inheritance taxes due and a motion for its allowance with the settlement court in voting priority of lien pursuant to Section 315 of the Tax Code.

and her willingness to pay the taxes corresponding to her share. for the reasons. This request was rejected by the Commissioner in his letter dates January 20. 459 before the Court of First Instance of Iloilo? 3. said Court declared the right of the Commissioner of Internal Revenue to assess the estate and inheritance taxes in question to have prescribed and rendered the following judgment: WHEREFORE. 1960 Lilia Yusay filed a petition for review in the Court of Tax Appeals assailing the legality of the assessment dated February 13. Hence. 1960 she filed her petition for review in the Court of Tax Appeals. and Lilia Yusay. who administered the remaining one-third. And under the Rules. filed an answer to the proof of claim alleging non-receipt of the assessment of February 13. Stephen's Association v. Ramon Gonzales. 1958. 1958. not from the date the assessment was issued. received by Lilia Yusay on March 14. the Commissioner attacks the jurisdiction of the Court of Tax Appeals to take cognizance of Lilia Yusay's appeal on the ground of lis pendens. 1960 she received the decision of the Commissioner of Internal Revenue on the disputed assessment. Said Court correctly held that the appeal was seasonably interposed pursuant to Section 11 of Republic Act 1125. its authority relates only to matters having to do with the settlement of . On March 14. is of 4 limited jurisdiction. On April 13. Could the Court of Tax Appeals take cognizance of Lilia Yusay's appeal despite the pendency of the "Proof of Claim" and "Motion for Allowance of Claim and for an Order of Payment of Taxes" filed by the Commissioner of Internal Revenue in Special Proceedings No. Should she maintain it in the settlement court or should she elevate her cause to the Court of Tax Appeals? We say. 1955 to guarantee payment of the taxes in question and when he requested postponement of the payment of the taxes pending determination of who the heirs are by the settlement court. is exactly thirty days. and (2) that the estate's administrator waived the defense of prescription when he filed a surety bond on March 3. 1949. through her counsel. Next. 1960. Moreover. to the exclusion of the Court of First Instance. 1959 Lilia Yusay disputed the legality of the assessment dated February 13. (1) that the right to assess the taxes in question has not been lost by prescription since the return which did not name the heirs cannot be considered a true and complete return sufficient to start the running of the period of limitations of five years under Section 331 of the Tax Code and pursuant to Section 332 of the same Code he has ten years within which to make the assessment counted from the discovery on September 24. He maintains that the pendency of his motion for allowance of claim and for order of payment of taxes in the Court of First Instance of Iloilo would preclude the Court of Tax Appeals from acquiring jurisdiction over Lilia Yusay's appeal. the thirty-day period should begin running from March 14. the date Lilia Yusay received the appealable decision. where the Commissioner would wish Lilia Yusay to contest the assessment. The Commissioner of Internal Revenue appealed to this Court and raises the following issues: 1. 1953 of the identity of the heirs. She therefore requested that the assessment be declared invalid and without force and effect. Collector of 1 Internal Revenue. she acted correctly by appealing to the latter court. It is in that forum. 1959. the appeal was timely. de Yusay who administered two-thirds of the estate. the existence of two administrators. 1960. namely. that the counting of the thirty days within which to institute an appeal in the Court of Tax Appeals should commence from the date of receipt of the decision of the Commissioner on the disputed assessment.On June 1. 1960. Lilia Yusay's cause seeks to resist the legality of the assessment in question. 1958. the settlement court. An action involving a disputed assessment for internal revenue taxes falls within the exclusive jurisdiction 2 3 of the Court of Tax Appeals. We already ruled in St. From said date to April 13. She claimed that the right to make the same had prescribed inasmuch as more than five years had elapsed since the filing of the estate and inheritance tax return on May 11. Lilia Yusay. 1959 Lilia Yusay disputed the legality of the assessment of February 13. when she filed her appeal in the Court of Tax Appeals. and praying for deferment of the resolution on the motion for the payment of taxes until after a new assessment corresponding to her share was issued. 1960. Has the right of the Commissioner of Internal Revenue to assess the estate and inheritance taxes in question prescribed? On November 17. where she could ventilate her defenses against the assessment. No costs. namely Florencia Piccio Vda. This contention lacks merit. After hearing the parties. On April 13. Accordingly. 1958. On November 17. Was the petition for review in the Court of Tax Appeals within the 30-day period provided for in Section 11 of Republic Act 1125? 2. the decision of respondent assessing against the estate of the late Matias Yusay estate and inheritance taxes is hereby reversed.

Central Azucarera de Tarlac. supra note 7. 1958 or eight years. on the ground that the return was complete in itself although inaccurate. (2) when it covers the entire period involved. The reason is that the return submitted did not contain the necessary information required in the correct form. nine months and two days from the filing of the estate and inheritance tax return. And the 10 finding of said court as to its existence and non-existence is final unless clearly shown to be erroneous. the executor. as the case may be. shall file a return under oath in duplicate. He raised the point of fraud for the first time in the proceedings. A return need not be complete in all particulars. The circumstances constituting it must be alleged and proved in the court below. there would be no occasion for the imposition of estate and inheritance taxes. Section 332(a) of the Tax 7 Code would apply. only in his memorandum filed with the Tax Court subsequent to resting his case. however. The State taxes not itself. or both. She would rest her stand on Section 331 of the Tax Code which limits the right of the Commissioner to assess the tax within five years from the filing of the return. Yusay very well knew of the existence of the ommited properties. no inheritance tax could be assessed. Precisely. Paragraph (a) of Section 93 of the Tax Code lists the requirements of a valid return. deduction and credit 11 with such definiteness as to permit the computation and assessment of the tax. though exempt from both taxes. (3) such part of such information as may at the time be ascertainable and such supplemental data as may be necessary to establish the correct taxes. but certainly not because he honestly believed that they did not form part of the gross estate. There is no question that the state and inheritance tax return filed by Jose S. It declared only ninety-three parcels of land representing about 400 hectares and left out ninety-two parcels covering 503 hectares.the 12 return showed none . the gross value of the estate exceeds three thousand pesos. that this being so. Perhaps his motive in under declaring the inventory of properties attached to the return was to deprive Lilia Yusay from inheriting her legal share in the hereditary estate. 1958. Jose S. Thus. it would not make much difference where a return is made on the correct form prescribed by the Bureau of Internal Revenue if the data therein required are not supplied by the taxpayer. It may be well to note that the assessment letter itself (Exhibit 22) did not impute fraud in the return with intent to evade payment of tax. or where. The conclusion. As the court a quo found that no fraud was alleged and proved therein. was sufficient to start the period of prescription. the Supreme Court refrained from applying the said ruling of the United States Supreme Court in Collector of Internal Revenue v. Said court has no jurisdiction to adjudicate the contentions in question. Said Court rejected the plea of fraud for lack of allegation and proof. no surcharge for fraud was imposed. July 31. or anyone of the heirs. Yusay was sufficient to commence the running of the prescriptive period under Section 331 of the Tax Code rests on no solid ground. L-11760-61. Yusay was substantially defective. As found in L-11378. Fraud is a question of fact.the intestate estate is escheated to the State. the Supreme Court of the United States held that the filing 13 thereof did not start the running of the period of limitations. although not accurate. the Commissioner alleged no fraud. Just the same. the necessary information for the assessment of the tax would be missing. the Commissioner's right to make it has expired. To our mind. It states: (a) Requirements. As a matter of law. There is substantial compliance (1) when the return is made in good faith and is not false or fraudulent. 8 9 5 . Lilia Yusay claims that since the latest assessment was issued only on February 13. or. Second. administrator. (2) the deductions allowed from gross estate in determining net estate as defined in section eighty-nine. and ruled that the return. he broached the insufficiency of the return as barring the commencement of the running of the statute of limitations. It is sufficient if it complies substantially with the law. In his answer to the petition for review filed by Lilia Yusay in the Court of Tax Appeals. and (3) when it contains information as to the various items of income. in case of a nonresident not a citizen of the Philippines . on the basis of the return. In this jurisdiction. that the return filed by Jose S. Said huge under declaration could not have been the result of an over-sight or mistake. which — assuming they do not come exclusively under the Tax Court's cognizance — must be submitted to 6 the Court of First Instance in the exercise of its general jurisdiction. setting forth (1) the value of the gross estate of the decedent at the time of his death.—In all cases of inheritance or transfers subject to either the estate tax or the inheritance tax. the return mentioned no heir. it was incomplete. We see no reason to entertain the Commissioner's assertion that the return was fraudulent. Instead. The Commissioner claims that fraud attended the filing of the return. In a case where the return was made on the wrong form. First.estates and probate of wills of deceased persons. We now come to the issue of prescription. however. When there is no heir .

suffice it to state that it would be unjust to the taxpayer if We were to sustain such a view. A fortiori his willingness to pay the tax is no waiver to raise defenses against the tax's legality. the taxpayer is not bound to do anything more than to wait for the Commissioner to assess the tax. It was as though no return was made. without prejudice to reimbursement from her co-administratrix. The law imposes upon the taxpayer the burden of supplying by the return the information upon which an assessment 14 would be based. Hence. Regala. of course. Barrera. for purposes of determining whether or not the Commissioner's assessment of February 13.246. Under Section 306 thereof. Sanchez and Castro. the Commissioner came to know of the identity of the heirs on September 24.— (a) In the case of a false or fraudulent return with intent to evade tax or of a failure to file a return. not from the return.B. 1958. Accordingly. C.04 and P39. took no part. Reyes.. We quote Section 332(a): SEC. as aforesaid. 1958.. J. JJ.. the Tax Code does not bar the right to contest the legality of the tax after a taxpayer pays it. prescription did not abate the Commissioner's right to issue said assessment. We therefore hold the view that the return in question was no return at all as required in Section 93 of the Tax Code. he is not required to wait forever. So ordered. Section 331 of the Tax Code gives the 15 Commissioner five years within which to make his assessment.. His duty complied with. Non-observance consists in filing a false or fraudulent return with intent to evade the tax or in filing no return at all.J. it is from that time that the Commissioner was expected by law to make his return and assess the tax due thereon. 1957 to February 13. as administratrix of the intestate estate of Matias Yusay. The running of the period of limitations under Section 332(a) of the Tax Code should therefore be reckoned from said date for. Section 94 of the Tax Code obligated him to make a return or amend one already filed based on his own knowledge and information obtained through testimony or otherwise.12 as estate and inheritance taxes. The Court of First Instance acting as a settlement court is not the proper tribunal to pass upon such defense. the date of the assessment now in dispute. WHEREFORE. de Yusay for the latter's corresponding tax liability. Section 332(a) which is an exception to Section 331 of the Tax Code finds application. J. respectively. he can pay the tax and claim a refund therefor. Florencia Piccio Vda. concur. However. No costs. Makalintal. Lilia Yusay Gonzales. less than ten years have elapsed. Anent the Commissioner's contention that Lilia Yusay is estopped from raising the defense of prescription because she failed to raise the same in her answer to the motion for allowance of claim and for the payment of taxes filed in the settlement court (Court of First Instance of Iloilo). fraud or omission. at any time within ten years after the discovery of the falsity. . Except. therefore it would be but futile to raise it therein.The return filed in this case was so deficient that it prevented the Commissioner from computing the taxes due on the estate. 1953 and the huge underdeclaration in the gross estate on July 12. Moreover. Concepcion. From the latter date. and subsequently to assess thereon the taxes due. in which case Section 332 of the same Code grants the Commissioner a longer period. From July 12. the tax may be assessed. plus interest and surcharge for delinquency in accordance with Section 101 of the National Internal Revenue Code. Dizon. Zaldivar. the judgment appealed from is set aside and another entered affirming the assessment of the Commissioner of Internal Revenue dated February 13. 332.L. or a proceeding in court for the collection of such tax may be begun without assessment. but from other sources. The Commissioner had to determine and assess the taxes on data obtained. is hereby ordered to pay the sums of P16. Exceptions as to period of limitation of assessment and collection of taxes . 1957. As stated. 1958 is 16 barred by prescription.178. if the taxpayer failed to observe the law.

000. both real and personal in the Philippines. Judge Tan was appointed as executor of the testate estate of Elsie M. Rizal (Branch V MAGDALENA ABANTO and CAMILO ERIBAL. VICENTE JERODIAS — One Thousand Pesos (P1. In a letter. he distributed as follows: ñé+. e) to MISS CONSUELO L. (2) To Bess Lauer. which the latter issued in Special Proceedings No. on account of three orders dated June 5. left a last will and testament in which she made the following relevant disposition of her estate. dated June 3. (hereinafter referred to as "Judge Tan") filed with the Court of First instance of Pasig." which the Commissioner maintains were issued without or in excess of jurisdiction or with grave abuse of discretion. On March 11. GACHES. against the Honorable Judge Pedro C.00 as income tax for 1965 and 1% monthly interest due from the d Elsie M. Judge PEDRO C. (3) To Judge Tan as advance executor's fees." This prayer was granted by the probate court in an order dated June 25. This is a petition for certiorari. and BANCO FILIPINO SAVINGS AND MORTGAGE BANK. Executor.000.00). Medina and Bienvenido Tan. DELIA P. TAN. PACITO TROCIO — Ten Thousand Pesos (P10. Delia P. as Executor of the Estate of ELSIE M.5 million. Sr.000. Gaches — Bienvenido Tan. in his capacity as Judge of the Court of First Instance of Pasig. mandamus. 1966. MEDINA.. 1966 and/or final distribution has been made to said heirs of their respective shares in the estate. 1967. representing herself as the attorney-in-fact of the herein respondents Camilo Eribal and Magdalena Abanto.000. Medina (hereinafter referred to as "Atty. 1966). as Commissioner of Internal Revenue. 1966. P50. TAN — My office table and chair now in the library of my house. 1977 MISAEL P. PHILIPPINE BANKING CORPORATION. Gaches. 8 and 9.000. BIENVENIDO A. b) to my lavandero. the Commissioner filed with the probate court a proof of claim for the sum "of P192. JR. and at present a resident of San Francisco. After payment of my just debts and funeral expenses I intact that the balance of my property. to wit: ñé+. PHILIPPINE NATIONAL BANK. — Five Hundred Pesos (P500. filed with the probate court a motion praying that the executor of the estate be authority to give a monthly allowance to the voluntary heirs Abanto and Eribal from the month of May.G. 1966.00 each as advance .£ªwph!1 3. however. c) to my gardener. prohibition and injunction filed by the herein petitioner Misael P. Judge Tan informed the Commissioner that the testate estate was worth about ten million (P10 million) pesos and that the estate and inheritance taxes due thereon were about P9. jewelry and stocks I leave to my sister BESS LAUER widow." On July 19. On June 11. Rizal a petition for the probate of the aforesaid will On Aped 21. Gaches died on March 9. THE OVERSEAS BANK OF MANILA. Medina"). Rizal (hereinafter referred to as "respondent Judge").000. VERA. the herein respondent Atty.00. No. CRISANTO SALIPOT. d) the balance of my estate in the Philippines shall then be divided in half.000. as voluntary residual heirs of the Estate of the deceased ELSIE M. NAVARRO. 1966 without a child. Vera. The deceased. 1966 until "the receipt of the recommended advance of inheritance of P100. the herein respondent Judge Bienvenido Tan. On July 9. L-27745 October 18. It appears that one Elsie M.00. petitioner. SR. Jr.' 4. P150.00). P75. All my property in the United States consisting of furs. and (4) To Attys. 5249 entitled "In the Matter of the Testate Estate of Elsie M. in his capacity as Judge of the Court of First Instance of Pasig.R. 1966.£ªwph!1 'a) to my driver.00 each recommended by the Executor in his motion of June 6..00).364. GACHES. as attorney-in-fact of said heirs. respondents. Navarro. vs. and one of the carpets in my house to be selected by her. $75.00. One-half (1/2) to be given to CAMILO ERIBAL and the other half to MISS MAGDALENA ABANTO. 1966. Gaches without a bond. California. 1966 (subsequently clarified in an order dated August 11. Judge Tan filed with the probate court a motion praying for authority to make the following additional advance payments — (1) To Abanto and Eribal. Hon. in his capacity as Commissioner of Internal Revenue (hereinafter referred to as "Commissioner").

Saidajeno that him has no objection to the partial distribution of the estate as long as it an he shown that the rights and interests of the government can be full protected. may be considered to have impliedly denied the Commissioner's prayers for the appointment of a co-administrator and the non-payment of advance allowances and fees. On January 19.20.00 .60 reported as expenses made on January 30. 1967.93 as estate tax and.429. 1966.241. the manifestations of Atty. The voluntary heirs Magdalena Abanto and Camilo Eribal shill be responsible for all taxes of any nature whatsoever which may be due the government arising out of the transaction of the properties ol' the estate and the environment can. 1966. 1967. the investigation of his office having 1 allegedly disclosed that the next value of the testate estate was P10. 1967. 1. These payments were based on a tax return filed by Atty. Paredes manifested that he has no objection to the approval thereof provided that certain items enumerated therein be corrected or modified. as reported.93. .00 previously ruled to be paid to Atty. the said court. . presented by The executor. 1967 should be cancelled or excluded . On the same date. July 6. 1966 and all other orders granting the payment of advance inheritance.776.436.00 as inheritance tax. In this motion.00 is made for which reason the rights of the government to collect whatever deficiency. 1967 with the Bureau of Internal Revenue.140. the amount of P1. the probate court authorized the conversion of the amount of P75. and (3) for the non-disbursement of funds of the estate without prior notice to the Commissioner. 1966 into allowances for Eribal and Abanto." The respondent Judge granted Judge Tan's prayer in an order dated July 23. dated June 5. the Commissioner advised Judge Tan to Pay to the Bureau of Internal Revenue the sum of P1. Paredes. 1967 payable to Apolonio manifastation illegal should be only P114. 1967 may be approved. The Executor is hereby discharged from any and all responsibilities that lie has pertaining to the estate.000.015.000.055. the Commissioner also submitted to the probate court for its resolution a motion praying: (1) for the revocation of the court's orders dated June 25. as follows: the amount of shares in the Lepanto consolidated Mining Co. Judge Tan submitted to the probate court for approval a final accounting and project of partition of the testate estate. Medina on March 8.£ªwph!1 Submitted for resolution of this Court is the Amended Final Accounting and Project of Partition dated May 27.00 instead of P135. Atty.30 as estate tax and P7. .899. Considering. .00 worth of shares shall still remain to answer therefor (Sec. and in addition. the amount of P11. and that the time appearing as expenses made on May 10.429 instead of 6. Rules of Court). Medina as advance attomey's fees in its order of July 23. Acting thereon.000. he objected in principle to the Executor Fees and to the Attorney's Fees as excessive but left the matter to the discretion of the Court.000. the Amended Final Accounting and Project of Partition dated May 27. Rule 90. with the Probate court's approval.000. Judge Tan disputed the correctness of the assessment in a letter sent to the Commissioner. subject Lo this following. if it so desires. dated November 4.000.000. 1966. On November 26.398. 1967. on April 24. 1967.537.286.212.060.062. should be 6. from its subsequent actuations. counsel for the heirs. allowances and fees. 2. (2) for the appointment of a co-administrator of the estate to represent the Government. which manifestations were also adopted by Atty. On April 14. for the partial distribution of the estate as follows: ñé+. Although the records do not disclose that the probate court specifically disposed of this motion. In a letter.00 will be left to the estate even if a partial distribution in the amount of P3.attomey's fees. On June 3. if any may be asses it may be assessed in the future the heirs have already paid in good faith even ahead of its due dates transfer taxes in the total amount of P1. the Commissioner filed with the probate court a proof of claim for the death taxes stated in the assessment notice sent to Judge Tan. and it appearing from the subsequent manifestation of Atty. . terms and conditions: 1. Judge Tan claimed that the estate was very liquid and that "any claims whatsoever against the Estate and the Government shall be amply protected since over P7.69 as inheritance tax. that sufficient assets with a nutrient market value of at least P8. 1967. further. register its tax lien in the remaining assets after a partial distribution of the estate. July 23 and August 11.000.105.000. taxes. Judge Tan paid to the Bureau of Internal Revenue the amount of ?185. the respondent Judge issued an order. Virgilio Saldajeno of the Bureau of Internal Revenue.

Medina.000. as modified in the. 1.00 32. Lepanto Consolidated Mining Co.692 shares (common) 3.00 500.41 238. 2.537. To Magdalena Abanto and Camilo Eribal. Paredes and Saidajeno. 4. 1 .00 2. Central Azucarera del Pilar 17.00 The aforesaid amount is hereby ordered to be taken from the funds of the estate deposited with the Philippine National bank. 5. all United States taxes pertaining to her share in the estate. As to the other properties remaining after this partial distribution. San Miguel Corp. C. 3. To Vicente Jerodias 3. RIZAL. Bess Lauer. Tan. 120.000.00 2. subject to the above terms and conditions. To Vicente Crisanto salipot. Jr.00 2. cash in the amont of 5. Philippine Philippine Overseas Bank of Manila Banco Filipino Savings & Refund from 559. entitled Final Accounting and Project of Partition dated May 27. 50 TAMARIND ROAD. consisting of the following: A. Sr.3. FORBES PARK. 1967 submitted by the Executor.5000.330. To Judge Bienvenido A.000. sister and heir of the deceased shall be fully for. share and share alike thru their attorney-in-fact Delia P. To Atty.00 1. 581. Bienvenido A. BANK DEPOSITS: 1 . manifestation of Atty. 4. San Miguel Corp. SHARES OF STOCK IN THE FOLLOWING: 1 . WHEREFORE.755 shares .105.000.000.00 150. Tan. MAKATI. HOUSE AND LOT LOCATED AT NO.429 shares 16. 6.147. is hereby approved. Pacita Trocio P10.00 700. Jr.60 B. 500 shares (preferred) 4.

Consolidated Mines. June 5. Rizal. June 5. Manufacturas Textile Industriales de Filipinas. The petition at bar is based on the following propositions: . ñé+. Medina was consequently able to withdraw the sum of P2. the Commissioner. on the belief that the probate court's resolution on its motion was not legally necessary. 1967 with contempt. Delia P. the Philippine National Bank filed a motion in the probate court praying that it be authority to deposit with the said court the money in its hands in view of the conflicting claims of the parties over the funds in dispute. Inc.000 shares 25 shares 5 shares 443 shares 652 shares (10 shares. 6. prohibition and injunction against the aforesaid orders of the respondent Judge.858 shares 5. 1967). Atty. however. management & 642 common) The same shall be turned over and delivered to the attorney-in-fact of the voluntary heirs.000. Mayon Metal Corporation 8.368 shares 85. 1967 as well as the orders of June 5 and 8. issued warrants of garnishment against the funds of the estate deposited with the Philippine National Manial. 8 and 9. SO ORDERED. the respondent Judge issued an order lifting the wants in question. to be held by her to answer for whatever deficiency estate and inheritance taxes may still be due from the estate and the heirs in favor of the government. on the strength of sections 315-330 of the National Internal Revenue Code. the Commissioner filed a motion for reconsideration (supplemented on June 22. 10. 1967. On June 8. 1967.00 from the PNB. Pasig. 1967. filed with this Court the instant petition for certiorari. the overseas Bank of Manila. 1967) of the orders of the probate court dated June 5. having been informed in advance about the foregoing order by certain undisclosed sources. 1967. 7. 11. San Juan Heights 10. 1967 were received by the Commissioner on June 13.£ªwph! 1 J u d g e On the same day (that is. Soliangco & Co Inc. and the Philippine Banking Corporation. Metropolitan Insurance Co.) PEDRO C. On the same day (that is. Atty. mandamus.5. On June 7. Medina. 1967). 1967. On June 16. 9. 1967. Inc. June 9.330. A copy of this order of June 9. the respondent Judge issued an order denying the said motion and threatening the bank officials who refuse to implement its orders of June 5 and 8. On June 9. Medina filed in the probate court a petition for the discharge of the writs of punishment issued by the commissioner. 1967. Atty. Realty Investment Inc. the Commissioner.ñé+.1967. On July 6.£ªwph!1 (Sgd.

citing Collector vs. (3) Eribal and Abanto are willing and bound themselves to assume the responsibility for the payment of the taxes due against the estate except for the properties located in the United States which should be charged against Bess Lauer. however. the Commissioner stated that he had issued a revised assessment dated August 24. the position of the Commissioner would seem to be that the deficiency income taxes due and payable during the lifetime of the deceased should also be paid first. Vda.(1) That the distributive shares of an heir can only be paid after full payment of the death taxes. 1967 and that. de Codeniera L-9675. (5) The estate has sufficient assets with which to pay the taxes being claimed by the government.00 in 1966. as follows: ñé+. caretaker. 966. furthermore. Gaches death in March. Subsequently. companion and driver since 1929. (3) That the executor of an estate cannot be discharged without the payment of estate and inheritance taxes. In a reply filed on September 7. (4) The Commissioner does not object to the partition of the estate in question provided that enough assets are left to pay the taxes against the estate. 97. the material ones of which may be stated.000. 28. 1967. the herein respondents Atty. rule go of the Rules of Court in relation to sections 95 (c). as follows: (1) The Commissioner's notice of assessment. in fact. (6) There was nothing unusual in the institution of Abanto and Eribal as residual heirs of the deceased." citing section 1. there were due from the estate deficiency income taxes for the years 1961 to 1965 in the total sum of P1. however. Medina are. it is claimed that in 1965 the estate had an income of P41 1. a fact admitted by Atty. 1966.£ªwph!1 Madam: . (4) That the delivery of properties of the estate to a stranger [that is. in sum. Sept. 1957.16. Eribal. Later.182. stating that such distribute may be made so long as the payment of the taxes due the government is "provided for. As this case subsequently progressed before this Court.. Medina and Judge Tan put up a number of factual and legal arguments. Taking stock of the Commissioner's complaint that the disputed orders Were issued without or in excess of jurisdiction or with grave abuse of discretion. (5) That the respondent Judge has no authority to quash or dissolve writs of garnishment issued by the Commissioner. was based on wrong premises and valuation of the assets in question. the Commissioner reversed his stand on this point and stated that the probate court may so dissolve said writs of punishment as the assets in question were then in custodia legis. Saldajeno of the Bureau of Internal Revenue. dated November 10. Judge Tan claimed that the August 24.00 and over P750. a bond must be filed by the distributees to secure the payment of the transfer taxes. The Commissioner later modified his stand on this ProPosition in line with the view that it is sufficient if the payment of the said taxes is "Provided for. 106 and 107 (c) the National lnternal Revenue Code. secretary and cook from 1945 until Elsie M. Abanto was the testator's special nurse. was the deceased's cook. the Commissioner advanced the view that this proposition is already moot and academic. In a rejoinder. and in view of a compromise offer made by the respondents Abanto and Eribal to pay the taxes being claimed by the Bureau of Internal Revenue. the Commissioner had agreed during the pretrial conference in the probate court to reconsider certain items therein. which could more than cover the questioned allowances. on the other hand. Subsequently. (2) While partial distribution of the estate of a deceased may allowed. The contents of the mentioned revised assessment which was addressed to Atty. to the voluntary heirs herein] is not sanctioned by law. 1967 to cover the tax claims. 103.. companion. and (9) There had been no full distribution of the estate in question without payment of the transfer taxes since the said taxes are being disputed by the heirs. inter alia. (2) The allowance granted to Abanto and Eribal were taken solely from the income of the estate.296. the Commissioner changed his position. as the case at bar Progressed. for which reason the estate should not be ordered distributed until the same is fully satisfied. (7) The grant of allowances was never contested below and cannot now be raised in the-instant proceedings. (8) Adequate safeguards were specified in the probate court's order of June 5. 1967 assessment could still be reduced considerably.000.

972. and to gradually dispose of and sell the shares of stock representing of the delegate with an estimated market value of P2. Abanto and Eribal to restore to the court a quo the amount of P2.963.87 300.055. Atty.912.36.776.000 Lepanto Consolidated Co.800.74. foregoing thereby other possible objections to the other items just so this case can be earlier disposed of.734.53.00 P5. It should bear mention.588.776.026. 1967 and April 24.41). 1968 for the inherit tax.076.00. crediting the sums of P185. are willing to pay even before these due dates the entire amount-specified in said assessment. or a total of P1. P462.38.00. Although respondents voluntary heirs intend to assail and question the correctness of said assessment only insofar as the same has disallowed the deductions claimed by them for personal services rendered by various persons in the total sum of P366.the sum of P7.00).536. 1967.147.822.673.330. which Abanto and Eribal with the probate court niether this Court issued a pre injunction in the case at bar on july 10.022.07 subject to estate and inheritance taxes.41 185.. the Banco Filipino savings and Mortgage Bank (P581.520.286.7 P891. respectively.783..442.000. for transfer tax purposes. Also included among the assets for which authority to sell was being procured in the said offer of were 2.198.055. Medina riled with this Court a pleading captioned "Compliance and Offer of Compromise to Terminate this Case" in which she stated the following:ñé+.748.000. To pay the taxes in question.87 Less Amount Paid Deficiency Inheritance Tax & Penalty xxx xxx xxx 1.341. in order to already terminate and dispose of this case before this Honorable Court.83 and Pl. Atty. that the money withdrawn from the Philippine National Bank was not returned by Atty.£ªwph!1 xxx xxx xxx 4. Medina.50 and P5.882.31 respectively. The amounts of P193. Abanto or Eribal to the . at this point. funeral expenses and income taxes (1961-1965) payable. On Sepember 9. 1967 for the estate tax and March 9.154.00. Medina prayed in her offer of that she and Abanto and Eribal be authorize to make use of the funds of the estate on deposit with the Philippine National (P238.448.226.409. it was ascertained that she left real and personal properties in the sums of P377. were allowed as deductions resulting in a net taxable estate in.00).87 as deficiency estate and inheritance taxes and penalty still due on the transmission of the decedent's estate.00). I have the honor to advise that in a reinvestigation conducted by this Office. but under protest insofar as the same has disallowance is concerned. after.972.87 The deadlines for the payment of the aforementioned transfer taxes without penalty were December 9. and the Bank of Manila (P700. said repondents. 1967.673.68 and P4.00 withdrawn from the Philippine National Bank pursuant to the questioned orders of the probate court.353. or a gross estate of P9.. the Banking Corporation (P559.73 and P1. there are hereby further assessed the sums of P891.960.81. Atty.00 P4.286. representing accrued household and medical expenses. In view thereof. details of which are shown hereunder: Estate tax Less: Amount Paid Total Pl. among others.459.353.500. and every other money or property revived by them by of said questioned orders. 1967 ordering.892. nevertheless.69 Inheritance tax Corporation CPA Certificate Total 5. The mentioned Lepanto shares had then an estimated market value of P2. Medina. which were paid on April 4.

783.00 P1.P111.000. 1967.) House ------.20 119.00 30. 1968.202.38 462.000.00) 73.00 TOTAL ASSETS ñé+.212.00 REVISED ASSESSMENT .35 258.576.635. showing a reduced difference of more than P2 million.00 P9.882.69 Pl.392.026. The Commissioner submitted to this Court the required memorandum on May 25.000.probate court.00 30. these respondents having prayed this Court that the deposit of the mentioned stocks be as full compliance by them with the writ of pre injunction issued by this Court. On September 19.364.00 Fence -------.62 559.00 7.923.850.73/sq.00 7.050.000.899.862.48 million. the important items and figures described in which may be summed up comparatively as follows: ñé+. & 13.851. this Court issued a resolution requiring the Commissioner to submit a memorandum on how he arrived at his original assessment of more than ?8.00) 331.335.000.000.189. in.635.50 25.83 P192.50/sq.200.00 Volkswagen 7.81 383.00 (Vauxhalll) Furnitures Shares of stock Forbes Park lot — (at P144.320.172.022.172.00 Swimming Pool — 5.335.53 119.62 559.) (at P97.83 million and the revised assessment of only about ?6.00 P10.341.23 12.£ªwph!1 ESTATE OF ELSIER GACHES ASSETS ORIGINAL ASSESSMENT Cash in bank Philippine Foreign (US$ P3.2.000.40 193.00 P1.050.95) CarsLincoln — Pl8.£ªwph!1 LIABILITIES AND DEDUCTIONS Estimated Income Tax Payable (1965) (1961-1965) Aaccrued medical expenses Funeral expenses Judicial exercises TOTAL LIABS.000.734.m.

Salipot.30 Distribution of Hereditary Estate C.341.000. 1967.272.00 20.97 P 500.28 On November 17. Trocio Bess Lauer M. Eribal Total inheritance Tax due Add: Estate Tax Due TOTAL TRANSFER TAXES DUE P10.212. Salipot.960. Jr.140.06 P5. this Court authorized the herein respondents Abanto.076.198.536. Eribal Inheritance Tax Due C.473.41 P6. to the offer of compromise dated September 9.760.602.65 3.00 600.305.538.60 TRANSFER TAXES PAYABLE P1.00 3.575. Jr.00 1.076.409.960.00 672.698. Eribal and Atty.760.198. 1967. Jerodias P.190.000. This manifestation was first opposed by the Acting Commissioner of Internal Revenue on the ground that the Commissioner (who was then abroad) had actually requested the Solicitor General not to agree to the . the Solicitor General filed with this court a manifestation expressing his conformity.41 P 7.000.398.385.07 Pl.30 P8.00 192. Medina. to Inh.75 2.621.DEDUCTIONS P610.69 P 1.00 672. Medina to withdraw funds of the estate deposited with the Philippine Banking Corporation (P191. Abanto C.473.60 P 1. in behalf of the Commissioner. Trocio Bess Lauer M.233.233.448.00 600.00 10. On November 23.899.000. V.436.65 P9.06 2.849.708.74 P7.486.00 1.186.60 P9.75 3.436.00) in the form of cashier's checks payable to the Commissioner for the payment of the estate tax still unpaid under the terms of the revised assessment.30 P 8.734.316.66 P 500.060.000. that the cash in the banks of the estate as well as the proceeds to be realized from the sale of the shares of stock should be turned over to the Commissioner for the payment of the taxes due against the estate and the heirs thereof. Jerodias P.496.00 10.882. & Deductions Net Taxable Estate Less Estate'tax Due Estate Subj.74 Gross Estate Less: Laibs.316.849.204.882.186.99 P6. Tax P10.673.68) and the Overseas Bank of Manila (P700.409. subject to certain conditions.621.87 Pl.608.305.190. V.00 192.385.33 P 10.459.33 2.00 2. such as.382.81 1. 1967 made by Atty. Abanto C.00 20.398.20 610.97 3.

12 appearing.000. In view of this impasse and the fast approaching deadline for the payment of the estate tax. the Solicitor General subsequently said that the Commissioner's conformity was given to him orally. interest and penalties due thereon and the inheritance tax in the amount of P4. That the respondent taxpayers will pay the estate. she already wished to express her principals. but without prejudice to any right of the taxpayer to contest or protest the said assessments at the proper time and in the proper court. conformity to pay. 1968. under protest however. without court authority. Medina filed with this Court a petition to declare the Overseas Bank of Manila in contempt for allowing the renewal.000.. 1967.00.. Atty. so much of the assets of the estate . According to Judge Tan... 1967. . on the other hand. the income taxes for 1961 to 1965 against the estate in the demand letter of the Commissioner dated August 29... . 1968. It appears that the time deposit in question was held by the said bank under two certificates. That is order to generate the necessary funds for the purpose of paying the said taxes and delinquency penalties. in the mentioned assessment notice dated August 24. . Medina.000. However. to Atty.175. that she was likewise agreeable to pay. Atty. and. inter alia. It will be understood in this connection that if the balance of the deficiency estate tax in this case is not paid on or before December 9.£ªwph!1 l. apparently.974.00 to the amount previously paid as inheritance tax. 1967. on the other. That the respondents Delia P. filed with this Court a joint manifestation which. 1967 in the amount of P1. The Overseas Bank of Manila.161.000. Medina. however. 1968. including the delinquency penaltiesthereon.. and the other.. In a supplemental motion filed on December 8. claimed that the deposit in question was renewed before the bank received any letter demanding its release. however. the herein respondents Eribal. and that he had a gentleman's agreement with the officials of the bank that said deposit could be withdrawn in advance. Judge Tan. be. . Arrano Supervising Revenue Examiner of the Bureau of Internal Revenue. interest and penalties may be imposed as a consequence of the late payment of the balance of the estate tax assessed against the estate. and that she was also agreeable to being authority to sell such properties of the estate as may be necessary for the mentioned On the following day. January 27.£ªwph!1 . mentioned the respondents End an Abanto through their counsel that his Office .. which are due and collectible from the estate of Elsie M.000. 5% surcharge and 1% monthly interest for deliquency. for P600.51 plus whatever interest. Mr. and the Commissioner and the Solicitor General. reads as follows:ñé+. that is. Medina also prayed that the said bank and those responsible for extending the maturity date of said time deposit be held liable for the payment of whatever surcharges. the deficiency estate tax of P700. Rodolfo U. 4. but. 1967) amounted to P700. inheritance and deficiency income taxes covered by existing assessments.. Commmoner.00 plus surcharges. On December 5. Medina.00 with the said bank for another year. The certificates of time deposit covering the said funds had been endorsed in favor of the Commissioner in payment of the unpaid balance of the estate then December 7. 2. Medina requested the Commissioner to credit P700.. 1967. the same shall be subject to the interest on deficiency. Medina filed with this Court a manifestation in which she alleged that even as the proposed joint manifestation between the parties which was supposed to describe the matters agreed upon between them and the Commissioner during a conference hearing held on January 24. however. shall be sold . Magdalena Abanto and Camilo Eribal shall submit to this Honorable Court an inventory of all the properties and assets of the estate . Gaches.00 to mature on May 12. in answer to Atty. Atty.mentioned offer of compromise. converted into cash. Medina's mentioned petition. 1967.000. one for P100. 1967. however. extended the maturity date of said time deposits to May 12. he caused the extension of the maturity date of the said deposit but that in doing so he acted in good faith in that the testate estate then had ample funds and assets and the said time deposit earned a higher interest than a savings deposit. this request was not honored by the Commissioner. of the time deposit of P700.ñé+. that he needed no specific court authority for the purpose. That respondent Delia P.. regrets that the same cannot be accepted as payment of the deficiency estate tax in this case since they cannot. 1968 had not yet been shown to her. 3. On January 26. surcharges and penalties were due'thereon. at present or on before December 9.986. are hereby proposed to be constituted as the authorized agents of the parties herein to effect the sale . on the one hand. such being the custom in banking circles. but under protest. we are holding said certificates of time deposit for possible application in payment of the unpaid balance of the deficiency estate tax in this case as soon as said certificates can be converted into cash.. 1967.00 to mature on June 16. Medina. Atty. Abanto and Atty.

. 1967. (that is under existing assessments that is under the letter of demand of August 24 and 29. 1968. including the accopanying delinquency penalties. ." in a supplemental motion.16 as of March 9. abandoned the doctrine of mobilia sequuntur personal embodied in Article 19 of the old Civil Code.927.62 as follows: the income tax (P715. Medina and the at manifestation of the Parties.619..5. Medina claimed the said demands to be erroneous for the following reasons' (1) as to the estate tax. acting on the abovement manifestation of Atty. part only. On April 16. 1968. Atty. could legally. she (that is. . a motion to declare in contempt Lepanto Consolidated Mining Co. against the Estate.435.. being personal properties. 1967. taxes and delinquency penalties are fully paid.87 P700.773.46) in full. and that the properties of the testate estate in the United States of America which consisted of shares of stock and deposits in banks.07) in.296.353. A Medina was given the necessary authority to collect and receive funds payable to the estate in question and to sell such a thereof as may be necessary.000. under at. the above mentioned . On February 10. and (3) P451. including penalties. interest (P106. 7.186. On February 6. and liquidated. Medina to pay.052. and. That the said agents shall be direct to sell the assets of the estate .. On March 9.75 as inheritance tax corresponding to the share of Bess Lauer.29) in full.927.00 (x) 4. amt. were to be excluded from the computation of the gross estate of the deceased in the Philippines and the computation of the Philippine estate and inheritance taxes because. 1967 and all warrants of garnishment issued by the Commissioner relative to the estate of Elsie M. the transfer and in taxes collectible from the estate. medina further argued that Bess Lauer alone was solely responsible for the payment of the inheritance tax on her share and not the decedent's estate in the Philippines. as the resolution of this Court dated February 6. inheritance and in income taxes. she argued the the surcharges and interest.518.00 plus interest earned of P60. 8.000. and (3) as to tile deficiency income tax for 1961-1965.855.00) in full and surcharges P1. 1967) Estate tax (BalanceInheritance tax Total Estate and Inheritance taxes P5. Consequently. That all negotiations and transactions for the sale of the assets of the estate shall be made jointly by the authorized agents . That no disposition of any property or assets of the estate shall be effected except for the foregoing purpose. Medina. this Court. 1968. 1968.00 as estate tax. Medina on t ground that the said corporation refused to tum over to dividends payable to the testate estate unless the Commissioner first lifted his garnishment order on said dividends. On February 16. on March 8... 1968 and only on the tax proper. Medina. was filed by Atty.053.87 (xx) . the amount of P343. 1968 from the Commissioner for the payment of the following 1'756 900. Gaches. accrue only from September 29. 1968 required her "to pay only the estate. and against the heirs Magdalena Abanto and Camilo Eribal.000. 9.54 as payment of the remaining surcharges. According to Atty. 1968.00 as of March 9. the sites of those properties is the place where they are located. issued a resolution authorizing Atty. Atty. End and Abanto shall save fully paid the transfer and income tax including the penalties thereon. That this case shall not be terminated until . 1968 would more than cover the said tax and the certificates of time deposits were already endorsed to the Cmmissioner on December 6. 1967 up to February 27. covered by existing assessment Atty.. citing Article 16 of the new Civil Code which she she argued. Medina filed with this Court manifestation stating that she received a demand letter dated March 9. (2) P192. under philippine law. he principals Abanto and Eribal) was not responsible therefore. (2) as to the inheritance tax. if any were still due. she had paid the same in the total amount of P1. 6. she paid a total of ?838. the payment of the taxes was made in the following manner: on February 27. under protest covered by existing assessments. a counter-manifestation was filed with this court by the Commissiorner to the above-metioned manifestation according to the Commissioner.182. this Court issued a resolution suspendi the writs to preliminary junction issued by this Court on July and 17.000.91 as balance of the income tax for the years 1961 to 1965 Atty.. That the parties pray for the approval of the foregoing propositions. 1968. compromise penalty (P5. Medina thereafter submitted to this Court performance reports on her activities relative to the authority given her. the time deposit in the Overseas Bank of Manila of P700. 1968.. said suspension to be effective until such time that Atty. which was the amount stated in the assessment letter of the Commissioner cited August 9.

if the same is not paid in full on or before March 9. 1967 until full payment thereof.236. (xxx) plus 5% surcharge and 1% monthly interest thereon from August 29.000.000.16 P6.03 6.161.974.00 35. surcharge 1% monthly interest from 12/9/67 to 3/9/68 Total plus additional 1% monthly interest from March 9.00 P1. 1968 per O. 1968 until full payment thereof.175.51 (xxx) .00 P700.353. respectively Inheritance taxs due and collectible 4.12 P191. Inheritance Tax Inheritance tax due and collectible per letter of demand dated August 24.296.65 (xxxx) P1. 1967 (Annex "A") Less: Payments of inheritance Tax on March 1 and March 6.986. 1968.972.321.000. Medina.269.75 P4. 1967 until full payment thereof. monthly interest thereon.00 P 756.000. and (xxxx) pIus additional 1% monthly interest from September 29.R. the Commissioner alleged that after taking into consideration the payments made by Atty.£ªwph!1 (x) pIus 5% surcharge and 1% monthly interest thereon from December 9.986.87 21.Deficiency income taxes for 1961 to 1965 Delinquency penalties for late filing of income tax return and late payment of income tax for 1965 per return filedTotal deficiency income taxes for 1961 to 1965 and the delinquency penalties of income tax 1965 per return GRAND TOTAL ñé+. 2519938 and 2520026.182. (xx) plus 5% surcharge and 1%. Further. the balances as of March 9. 1968 of the death and income taxes still compatible were as follows: Estate Tax Balance of the estate tax 5%. 1967 until full payment thereof.

522. 1968. On August 23. 1968.818. Medina in the total amount of P1. 1967 until full Payment with respect to the income tax for the 1965 return. vs. Out did not include the 5% surcharge and 1% monthly interest for delinquency from August 29. 1968 until full payment. A comment was filed on October 11 1968 by the Overseas Bank of Manila stating that the majority stockholders of the bank filed a petition against the Central Bank for certiorari.75 as balance of the inheritance tax.296. 1967 merely authorized Atty.182. 1967 plus 5% surcharge and 1% monthly interest up to March 1968 Less: Payments made on February 27.000.17 The Commissioner also explained that the i taxes paid by Atty.£ªwph!1 (1) The amount of P756." that the time deposit in question was an unrecorded transaction. and that the Central Bank . plus additional 1% monthly interest thereon from March 8. P107. plus 5% surcharge and 1% monthly interest thereon from March 9. averred that this Court's resolution of November 17.01 P1.16 "included only the 1/2% monthly interest On deficiency with respect to the deficiency income taxes for 1961 to 1965 and the 1% monthly Interest for delinquency up to September 29.00 as balance of the estate tax.R. 1968 under O. 1968 until full payment. the nonpayment of the said deposit was not wilful as the Overseas Bank of Manila was in a state of insolvency. plus additional 1% monthly interest from March 9. Deficiency Income Taxes Deficiency income taxes from 1961 to 1965 per letter of demand dated August 29.16 P1. 2 et at. prohibition and mandamus in this Court in L-29352 entitled "Emerito M. and (3) The amount of P107. The Central Bank.289. 1968 until full payment." The Commissioner consequently prayed that Atty. 1968.01 as balance of the deficiency income taxes. on September 18. Medina concerning the deposit in question. Atty. 5% surcharge and 1% monthly interest from December 9.182. 1968 until full payment. according to the Central Bank.986. 5% surcharge and 1% monthly interest for delinquency up to M arch 8. Medina payed that the bank Ida as one boss able the deposit of the funds of is well as the who made i of the estate of Elsie M. 1968. Gaches with the said bank be declared in contempt. 1967 with respect to the income tax for 1965 which was paid per return.plus 5% surcharge and 1% monthly interest thereon from March 8.. Medina be ordered to pay: ñé+. 1967 to March 9.522. (2) The amount of P191. Medina to withdraw the deposit from the said bank and did not order the bank to pay the time deposit in question. Ramos. . 1968 and March 8. 1968 until full payment . the Central Bank Of the Philippines filed with this Court a comment on the urgent manifestation of Atty.. 207001 and 207002 Deficiency income taxes still due and collectivele plus additional 1% monthly interest thereon from March 8. which according to the Overseas Bank of Manila had restrained it from paying its time deposits to the bank's depositors. Moreover. Atty. Central Bank.296. Medina filed a manifestation with this Court adverting to the refusal of the Overseas Bank of Manila to permit the withdrawal of the time deposit of the testate estate in the said bank in spite of the fact that the extended maturity date of said deposit had may expired.

any property forming part of a hereditary estate without the payment of the death taxes first being shown. e. While this Court thus holds that the questioned orders are not in accordance with statutory requirements. which penalizes the executor who delivers to an heir or devise. On March 29. On the matter of the authority of a probate court to allow distribution of an estate prior to the complete Nuidation of the inheritance tax. and the officers and employees of business establishments who transfer in their books to any new owner. Abanto and Eribal Jointly wrote the Chief Justice. but the indispensability of forestalling needless delays when those issues are raised anew. the two respondents herein subsequently retracted their statement in the said letter. however. Medina Eribal and Abanto. 1969. Atty. Paredes ssubmitted knitted a memorandum on the nature and extent for the legal services he had rendered to tile herein respondents Atty. 19681. have. consequently. the same cannot merit approval of this Court.000." The aforesaid orders of the respondent Judge are clearly in diametric opposition to the mentioned Section 103 of the Tax Code and. however. expressing willingness and agreement to pay the amount due tile government as taxes against the estate and the heirs thereof.00) representing the face value of time deposit certificates assigned to the Commissioner which could not be converted into cash? Aside from the foregoing. the fundamental question raised herein regarding the objectionable character of the probate court's mentioned orders has opened other issues which. Atty. claiming they signed and sent the same without knowing and understanding its effect and consequences. motion . persuaded this Court that their complete and final adjudication here and now is properly called for. said share of the latter consisting of personal (cash deposits and. shares) properties located in the mentioned court (3) Does the assignment of a certificate of time deposit to the comissioner of Internal Revenue for the purpose of paying t I hereby the estate tax constitute payment of such tax? (4) Should the herein respondent heirs be held liable for the payment of surcharge and interest on the amount (P700. and Section 107. for which reason it could not give preference of the payment of the said deposit as it might prejudice other creditors of the bank. viz. Eribal and Abanto for professional services rendered In connection with the settlement of the estate of Elsie M. 8 and 9. perforce. Gaches? 1. Rule 90 of the Rules of Court erases this hiatus in the statute by providing thus: ñé+. On November 11. not alone their importance to jurisprudence.g. is not entirely unreachable. There are provisions of the Tax Code. Section 103 of the National Internal Revenue Code (hereinafter referred to as "Tax Code") unequivocally provides that "No judge shall authorize the executor or judicial administrator to deliver a distributive share to any party interested in the estate 3 unless it shall appear that the estate tax has been paid. the Tax Code apparently lacks any provision substantially Identical to the mentioned Section 103 thereof. Section 1. Gaches estate. Paredes whom she and tile other herein respondent herein — Abanto and Eribal — hired as counsel in collection with the settlement proceedings of Elsie M. which imposes a similar obligation on business establishments. Said issues may be specificaly framed as follows: (1) Should the herein respondent heirs be required to pay first the inheritance tax before the probate court may authorize the delivery of the hereditary share pertaining to each of them? (2) Are the respondent heirs herein who are citizens and residents of the Philippines liable for the payment of the Philippine inheritance tax corresponding to the hereditary share of another heir who is a citizen and resident of the United States of America. Medina filed with this Court a M. 1971. Section 104.. (5) What should be the liability of the respondents herein on the contempt charges respectively lodged against them? (6) What should be a reasonable fee for the counsel of the respondents Atty. A perusal in depth of the facts of the instant case discloses quite plainly that the respondent Judge committed a grave abuse of discretion amounting to lack of jurisdiction in issuing its orders of June 5. but those provisions by themselves do not clearly establish that the purchase and object of the statute is to make the payment of the inheritance tax a pre-condition to an order for the distribution and delivery of the decedent's estate to the lawful heirs there.. 1967.00 to Atty. Section 106. The cloud of vagueness in the statute.000.prohibited the bank to do business due to its distressed financial condition. On June 26. Medina. Manuel M.reiterating a previous one to allow the payment of the announced of P6..£ªwph!1 . pursuant to a resolution of this Court. which makes it the duty of registers of deeds not to register the transfer to any new owner of a hereditary estate unless payment of the death taxes sham be shown. there are also other incidental questions which are raised in the present recourse.

Gaches (except the cash deposits of more than P2 million) shall be trusted to Atty. the probate court virtually withdrew its custodial jurisdiction over the estate which is the subject of settlement before it. and in accordance with the scale fixed for the class or group to which is pertains: Provided. this Court cannot subscribe to the proposition that the payment of the tax due was thereby adequately provided for. have been paid. the controversy shall be beard and decided as in ordinary cases. Consequently. l967 was. unless the distributees. a complete distribution of the estate to the heirs for. chargeable to the estate in accordance with law. the distribution of a decedent's assets may only be ordered under any of the following three circumstances. the least reasonable thing that the probate court should have done was to require the heirs to deposit the amount of inheritance tax being claimed in a suitable institution or to authorize the sale of non-cash assets under the court's control and supervision. and inheritance tax. In the first place.Section 1. naming them and the proportions. they shall be solidarity liable for the payment of the said taxes to the extent of the estate they have received. (1) when the inheritance tax. When order for distribution of residue made. . There is no evidence on record that would show that the probate court ever made a serious attempt to de what the values of the different assets the correctness of that such properties shall be preserved for the satisfaction of those case In the third place that main of pesos taxes were being called by the Bureau of Inc. to which each is entitled. and expenses of administration. transfer. Revenue. Under the provisions Of the aforequoted Rule. in the distribution of the properties of the estate in question. give a bond. funeral charges. as a rule. 2. in proportion to the value of the benefit received. relief solely upon the mere mandestation of the counsel for the heirs Eribal and Abanto that them were affiant of the estate with which to pay the taxes due to the government. The record is likewise bereft of any evidence to show that sufficient bond has been filed to meet this particular outstanding obligation. the scope and subjects of this tax and other related matters in which it is involved must be traced and sought in the law itself. Section 95(c) of the Tax Code. 1967 that the distribution of the estate of Elsie M. or any person having the same in his possession. is paid. was meant to be the joint and solidary liability of the heirs of a decedent. An analysis of our tax statutes supplies no sufficient indication that the inheritance tax. be charged to the account of each beneficiary. the executor who is supposed to take care of the estate was absolutely discharged the attorney's fees for the of a lawyer who presumably acted as legal counsel for the estate in the court below were ordered paid as were also the fees for the executor's the cash funds of the estate were red paid to the cash and the non-cash (real property and shares of stock) properties were likewise ordered delivered to Atty. The liability of the herein respondents Eribal and Abanto to pay the inheritance tax corresponding to the share of Bess Lauer in the inheritance must be negated. Medina for the payment of whatever taxes may be due to the government from the estate and the heirs them to. in a sum to be fixed by the court. That in cases where the heirs divide extrajudicially the property left to them by their predecessor or otherwise convey. In short. Medina whose participation in the said proceedings was in the capacity of an attorney-in-fact of the herein respondent Eribal and Abanto. mortgage. and such persons may demand and recover their respective shares from the executor or administrator. conditioned for the payment of said obligations within such time as the court directs. indicates that the general presumption must be otherwise. The inheritance tax is an imposition created by law on the privilege to 4 receive property. for all intents and . the allowance to the widow. or (3) when the payment of the said tax and at the other obligations mentioned in the said Rule has been provided for one of these thru camar as the satisfaction of the when tax due from the festate is were present when the question orders were issued in the case at bar. If there is a controversy before the court as to who are the lawful heirs of the deceased person or as to the distributive shares to which each person is entitled under the law. sell. in fact. the order of June 5. and after hearing upon notice. In the second place the respondent Judge. shall assign the residue of the estate to the persons entitled to the same. among others. — When the debts. Although the respondent Judo did make a condition in its order of June 5. or parts. if any. No distribution shall be allowed until the payment of the obligations above mentioned has been made or provided for. on the application of the executor or administrator.£ªwph!1 (c) xxx xxx xxx The inheritance tax imposed by Section 86 shall. in the absence of contrary disposition by the predecessor. or of a person interested in the estate. (2) who bond a suffered bond is given to meet the payment of the tax and all the other options of the nature enumerated in the abovecited provision. or any of them. namely. the court. The said subsection reads thus: ñé+. or encumber the same without being the estate or inheritance taxes within the period prescribed in the preceding subsections (a) and (b).

5% surcharge and 1% monthly interest for deficiency. The estate of Elsie M. during the pendency of this case.000. (b) against the officer of the Overseas Bank of Manila for allowing the extension of the maturity date of the mentioned time deposit of P700. because the Overseas Bank of Manila refused to issue such checks or to allow her to withdraw said amount in view of the extension of the nuturity date of the deposit in question. While there are cases in this jurisdiction holding that a surcharge shall not be visited upon a taxpayer whose 9 failure to pay the tax on time is in good faith. Medina thought that by simply assigning the time deposit certificates to the Commissioner. fully informed the respondents Atty.. It will be worthwhile to mention also. The estate cannot likewise be exempted from the payment of the 5% surcharge imposed by Section 101 (c) of the Tax Code.00 imposed under Section 101 (a) (1) and (c). the resolution of this Court dated November 17. Medina was. the value of the said certificates (P700. that when Atty. Eribal and Abanto of the condition to this acceptance of the said time deposit certificates. Consequently. 1967 and the other for P600.000. . 1967.The statute's enumeration of the specific cases when the heirs may be held solidarity liable for the payment of the inheritance tax is. it saw to reas that the tentatives of the estate who stand to be benefited. The Interest charge for 1% per month imposed under Section 101 (a) (1) of the Tax Code is essentially a commotion 7 to the State for delay in the payment of the tax due thereto As for the accountant use by the tax payer of funds that 8 nightday shall be in the government's funds. the name shall be subject to the interest on deficiency.000. namely.. 1967.000. it will also be noted that the respondents EAbal and Abanto.£ªwph!1 . Moreover. of each heir. a clear indication that beyond those cases.000. this element does not appear to be present in the case at bar. As the indorsement and delivery of the mentioned time deposit certificates to the did not result in the payment of the estate tax (for which it was in the respondents estate is fluently liable for the interest charge imposed in the Tax Code. therefrom. had in their actual ion at least P2.in accepting the indorsement and delivery of the said certificates. And the effect of the indorsement of the time deposit certificates to the Commissioner. to the extent of the benefits received. 3. specifically admitted that he was the one who caused the extension (and consolidation) of the maturity dates of the two time deposit certificates in question (one for P100. at present or on or therefore December 9. in the opinion of this Court. 1967. a time deposit certificate is a mercantile document and is essentially a promissory note. the payment of the inheritance tax should be taken as'the individual responsibility. she would be deemed to have paid the estate's obligation in its corresponding amount. Atty. Medina applied to this Court for authorize to the amount of P700. However. should have forthwith asked for authority to pay the from other funds of the estate.00 and for refusing to pay the same after the 5 . in fact. Medina. Medina.00 to mature on May 12.000.is soon as said certificates can be converted into cash. However.00 in question from the proceeds of the Wm she made afterwards. 1967) to May 12. we are holding said certificates of time deposit for possible application in payment of the unpaid balance of the deficiency estate tax in this case . 5. or when through the fault of the creditor they have been impaired. Since the refusal of the Overseas Bank of Manila to snow the withdrawal of the said deposit was then well-known to the parties. Gaches.000. as executor of the estate of Elsie M. the Commissioner expressly gave notice that his Office — ñé+. given the authority by this Court to sell assets of the estate for the payment of the taxes due to the State.000. Gaches is likewise liable for the payment of the interest and surcharges on the said amount 6 of P700. Apparently.3 million (the amount they were able to withdraw from the Philippine National Bank on account of the questioned orders) which they could have very well used for the payment of the estate tax. 1967. the Commissioner as well as the herein respondents Atty. By the express terms of Article 1249 of the Civil Code of the Philippines." Moreover. We now consider the several petitions for contempt riled in the case at bar.00 from the Overseas Bank of Manila on September 9." From the records of the case at bar. 1968. advised them in the same letter that "It will be understood in this connection that if the balance of the deficiency estate tax in this case is not paid on or before December 9. however. 4. such as the respondents Eribal and Abanto.00) should still be considered outstanding. Judge Tan himself. In the second place. be converted into cash. of the Tax Code. the same cannot be held to have extinguished the estate's liability for the estate tax.. The Commissioner. Regrets that the same cannot be accepted as payment of the deficiency estate tax in this case may they cannot. in this connection.00 in contravention of the writ of punishment issued by the Commissioner. In the first place. in fact.00 to mature on June 16. as aforesaid. approve her request authorized her to withdraw the said amount in the form of cashier's checks payable to the Commissioner. Atty. as aforesaid the Commissioner was also unable to convert said amount to cash and he gave announce to that effect to Atty. The Commissioner. opted to put the same to other uses. the use of this medium to clear an obligation will "produce the effect of payment only when they have been cashed. respectively. (a) against the Philippine National Bank on account for allowing Atty. Medina.330. Eribal and Abanto spared no time trying to collect the value of said certificates from the Overseas Bank of Manila but all to no avail. but she never tried to pay the equivalent amount of P700. They. Medina to withdraw P2..

Plana (annex B of the same Manifestation). this Court passed a resolution suspending temporarily the warrants of punishment issued by the Commissioner. its operations were suspended. Indeed. 1968. With reference. In any case. was accepted and duly approved by Acting Commissioner of Internal Revenue Efren I. (c) The contempt charge against Judge Tan is also not meritorious. In the case of the renewal of the term of the time deposits in question. 1967 were not strictly complied with by the said respondents. It is refusing to turn over to Atty. Eribal and Abanto. On July 18. (a) The contempt charge against the officials of the Philippine National Bank is without merit. 7. (d) against the Lepanto Consolidated Mining Co. 1968. (c) against Judge Tan who renewed the maturity date of the said time deposits.The renewal of said term may be considered as purely an act of administration for the enhancement (due to the higher interest rates) of the value of the estate. the said extension was made by no less than the executor of the estate himself. it was excluded by the Central Bank from inter-bank clearing. Moreover. it is evident that the said corporation acted in good faith in view of the writ of garnishment issued to it by the Commissioner. it appearing to the satisfaction of this Court that they excited reasonable efforts not to disobey the writ of garnishing issued by the Commissioner.s order as the estate in Question was then in custodia legis. respondent Delia P. The payment of this amount. and on August 13.extended term expired. through the Solicitor General. in this Court. that as early as November 20. Medina. (e) With reference to the charge for contempt against the respondents Atty. and the officials of the bank cannot consequently be blamed or acting favorably on the executor's application. and it does not appear that thereafter the turnover of the stock dividends to the estate was refused. and (e) against the herein respondents Atty. With reference to the attorney's fees to be paid to Atty. Judge Tan himself explained that he did what he did honest the belief that it would redound to the benefit of the estate on the account of the higher interest rate on time deposits. and not that of the estate of Elsie M. after a careful study of the statement of services rendered by said counsel to the respondents Eribal and Abanto which was submitted to this Court.000 as all estate tax. Manuel M. 1968. on July 31. on February 16.00. on August 1. Oct. Medina to withdraw the said time deposits after the extended term would have worked an undue prejudice to the other depositors and creditors of the bank. that the amount of Fifty Thousand Pesos (P50. The Court's intended adjudication of the main issue has been rendered academic by supervening events which dictate that the court refrain from issuing any further order relating thereto. the main objective of the instant petition is to assure the State that the assessed tax obligations shall be paid and. 41 SCRA 565). this Court is satisfied with the explanation that to allow Atty. more than P2 million had already been paid to the State during the pendency of the instant proceeding. Gaches. contrary to the resolutions of this Court dated July 10 and 17. Medina which states that a compromise payment of P700. 6. and that "with the said . Gaches unless the Commissioner first lifted his punishment order. 1977 a "Manifestation and Compliance" was filed by the. however. 1968. evidence by an official receipt (annex A of the Manifestation). Medina. (d) The Lepanto Consolidated Mining Company is likewise entitled to exoneration from the contempt charge lodged against it. Paredes. The Overseas Bank of Manila was not able to normalize its operations in spite of the voting trust agreement — for. 1967. for refusing to turn over dividends payable to the estate of Elsie M. 1971. The commssioner himself.000. as the said counsel was hired by the said respondents to give legal aid to them in connection with the settlement of the various claims preferred in the probate court and in this Court. from the records.00) is fair and reasonable. to execute a voting trust agreement in order to bail it out through a change of management and the promise of fresh funds to replenish the bank's financial portfolio.520. 1967 the Central Bank required the Overseas Bank of Manila. is the personal liability of the said respondents Eribal and Abanto. it was completely forbidden by the Central Bank to do business preparatory to its forcible liquidation. as stated in our decision in Ramos vs. although admittedly the resolutions of this Court dated July 10 and 17. 1968. There is no sufficient and convincing evidence to show that he renewed the maturity date of the time deposits in question maliciously or to the prejudice of the interest of the estate. to the refuse of the bank's officials to allow the witldrawal of time deposit in question after the extended term expired on May 12.330. it appears clearly that they immediately deposited with the probate court shares of stock with a fairly stable liquidity value of P2. this court is of the opinion. Eribal and Abonto for citing shares of stock with the probate court instead of the cash amount of P2. said officials merely acted in obedience to the order of the probate court which threatened them with contempt of court after they moved to be allowed to deposit with the said probate court the money of the of Elsie Gaches deposited with the said bank. admitted later that its writ of garnishment cannot be superior to that of the probate court.588. 4. in view of its distressed financial condition. Under the circumstances. (b) The contempt charges against the officials of the Overseas Bank of Manila likewise merit dismissal.00 which they withdrew from the renewed National Bank on account of the questioned orders of the probate court. Medina stock dividends payable to the estate of Elsie M. Gaches. this Court takes notice of the fact.000. Central Bank (L-293250.

claimed by the State and. the same to be Paid by the respondent End will the estate of Abanto. of Deputy Commissioner Conrado P.498. to withdraw all cash deposits in various banks and sell such properties of the estate as my be necessary. With the full settlement of the tax claims. Judge Bienvenido Tan.. .000. are hereby ordered dismissed. including pertinent delinquency penalties thereof have been fully paid and liquidated. the Court renders judgment as for: (1) The amount of FIFTY THOUSAND (P50.000. 1968. informing the Register of Deeds of Pasig. 1977. Paredes as legal fee for his services." No objection thereto was interpored by any of this parties concerned despite due notice thereof. the requirements of the law have been fully met. aggregating to P7. Medina is to deliver the remaining assets of the estate to the voluntary heirs in the proportions adjudicated in the will and to submit a report of compliance. the notice of tax then inscribed on the property and property rights of the estate can now be considered cancelled.00) PESOS is hereby awarded to Manuel M. No costs. . and that. (3) The authority given to the respondent Delia P. all estate.929. Metro Manila. and (4) The writs of preliminary injunction issued by the Court pursuant to its resolutions dated July 10 and 17.55 . . is hereby terminated. consequently. dated July 19. now (2) The contempt charges against the officials of the Philippine National Bank and the Overseas Bank of Manila. This was further supplemented by a communication. ACCORDINGLY. inheritance and deficiency income taxes . On the incidental issues. including delinquency penalties. that the Gaches estate has already paid all the estate and inheritance taxes assessed against it.compromise payment of P700. the respondent Delia P. Sr. to pay the death and income taxes. for that.. and it has unnecessary for the Court to issue orders relative to the main issue. and Lepanto Consolidated Co. 1967 are hereby dissolved. Medina in the resolution of the court dated February 6.. Diaz.

Dison was the legitimate and only child of Don Felix Dison. vs. 4.. The petitioner alleged in his complaint that the tax is illegal because he received the property. The question to be resolved may be stated thus: Does section 1540 of the Administrative Code subject the plaintiff-appellant to the payment of an inheritance tax? The appellant argues that there is no evidence in this case to support a finding that the gift was simulated and that it was an artifice for evading the payment of the inheritance tax. 1932 LUIS W. 1928. At the trial the parties agreed to and filed the following ingenious stipulation of fact: 1.808. from his father before his death by a deed of gift inter vivos which was duly accepted and registered before the death of his father. This is an appeal from the decision of the Court of First Instance of Pampanga in favor of the defendant Juan Posadas.73 paid under protest. Dison. but the cross-complaint and appeal of the Collector of Internal Revenue were dismissed by this court on March 17. 3. The theory of the plaintiff-appellant is that he received and holds the property mentioned by a consummated gift and that Act No. as the sole and forced heir of the donor. Collector of Internal Revenue. the plaintiffappellant. was fraudulently made for the purpose of evading the inheritance tax. acknowledged by the donor five days before his death and accepted by the donee one day before the donor's death. do warrant the inference that the transfer was an advancement upon the inheritance which the donee. Dison. 1928. made a gift inter vivos in favor of the plaintiff Luis W. which is the basis of the tax. This deed of gift transferred twenty-two tracts of land to the donee. on motion of the Attorney-General. before his death. It is inferred from Exhibit D that Felix Dison was a widower at the time of his death. there shall be added to the resulting amount the value of all gifts or advances made by the predecessor to any of those who. does not tax gifts. 1932. for the recovery of an inheritance tax in the sum of P2. and the deed of gift executed by Felix Dison on April 9. in our opinion. Jr.245. In this case the scanty facts before us may not warrant the inference that the conveyance. — After the aforementioned deductions have been made. Dison. The provision directly here involved is section 1540 of the Administrative Code which reads as follows: Additions of Gifts and Advances. on April 17. The defendant answered with a general denial and with a counterdemand for the sum of P1. That Don Felix Dison. The plaintiff replied to the counterdemand with a general denial.net The only evidence introduced at the trial of this cause was the proof of payment of the tax under protest.R. The court a quo held that the cause of action set up in the counterdemand was not proven and dismissed the same. But the facts. formally accepted said gift by an instrument in writing which he acknowledged before a notary public on April 20. . devises. 2. Both sides appealed to this court. L-36770 November 4.56 which it was alleged is a balance still due and unpaid on account of said tax. Dison of all his property according to a deed of gift (Exhibit D) which includes all the property of Don Felix Dizon.G. reserving to the donor for his life the usufruct of three tracts.1awphil. Luis W. in favor of his sons Luis W. legatees. 1928. We see no reason why the court may not go behind the language in which the transaction is masked in order to ascertain its true character and purpose. in a suit filed by the plaintiffs. as stated. Luis W. plaintiff-appellant. 1928. That the plaintiff did not receive property of any kind of Don Felix Dison upon the death of the latter. That Don Felix Dison died on April 21. Collector of Internal Revenue.. This deed was acknowledged by the donor before a notary public on April 16. 2601 (Chapter 40 of the Administrative Code) being the inheritance tax statute. would be entitled to receive upon the death of the donor. as is intimated in the decision of the court below and the brief of the Attorney-General. No. That Don Luis W. after his death. or donees mortis causa. 1928. shall prove to be his heirs. DISON. defendant-appellant. JR. JUAN POSADAS.

The judgment below is affirmed with costs in this instance against the appellant. we hold that there is not merit in this attack upon the constitutionality of section 1540 under our view of the facts. regardless of the quantity of property they may receive as such heirs. in any event. Construing the conveyance here in question. and can only take effect after the donor's death. We construe the expression in section 1540 "any of those who. devisees. L. it doubtless refers to gifts inter vivos. 2601 nor chapter 40 of the Administrative Code makes any reference to a tax on gifts. This court said in the case of Tuason and Tuason vs. . are given the status and rights of heirs. Such. This appeal was originally assigned to a Division of five but referred to the court in banc by reason of the appellant's attack upon the constitutionality of section 1540. this appellant could not be deprived of his share of the inheritance because the Civil Code confers upon him the status of a forced heir.The argument advanced by the appellant that he is not an heir of his deceased father within the meaning of section 1540 of the Administrative Code because his father in his lifetime had given the appellant all his property and left no property to be inherited." However much appellant's argument on this point may fit his preconceived notion that the transaction between him and his father was a consummated gift with no relation to the inheritance. 289):lawphil. and not mortis causa. legatees or donees mortis causa of the donor. under the facts presented." Neither the title of Act No. when the donee. and it is to prevent this that it provides that they shall be added to the resulting amount. and not to mortis causa donations. . after his death. . So ordered. Any other construction would virtually change this provision into: ". . Perhaps it is enough to say of this contention that section 1540 plainly does not tax gifts per se but only when those gifts are made to those who shall prove to be the heirs. it violates that provision of section 3 of the organic Act of the Philippine Islands (39 Stat. by our law. Posadas 954 Phil. We do not know whether or not the father in this case left a will. to include those who. as an advance made by Felix Dison to his only child. No other constitutional questions were raised in this case. That the appellant in this case occupies the status of heir to his deceased father cannot be questioned. bequest. and that subject shall be expressed in the title of the bill. . there shall be added to the resulting amount the value of all gifts mortis causa . which can only be made with the formalities of a will. is the tenor of the language which refers to donations that took effect before the donor's death. shall prove to be his . made by the predecessor to those who. devisee or donee mortis causa. devise." We cannot give to the law an interpretation that would so vitiate its language. donees mortis causa. we hold section 1540 to be applicable and the tax to have been properly assessed by the Collector of Internal Revenue. or gift mortis causa. This attack is based on the sole ground that insofar as section 1540 levies a tax upon gifts inter vivos. after his death. for the purpose of evading the tax.n When the law says all gifts. is so fallacious that the urging of it here casts a suspicion upon the appellants reason for completing the legal formalities of the transfer on the eve of the latter's death.. shall prove to be his heirs". after the death of the donor proves to be his heir. Both the letter and the spirit of the law leave no room for any other interpretation.. . clearly. . 545) which reads as follows: "That no bill which may be enacted into law shall embraced more than one subject. The truth of the matter is that in this section (1540) the law presumes that such gifts have been made in anticipation of inheritance.

R. INTERMEDIATE APPELLATE COURT and SPS. vs. et al . 27. petitionerappellant v. et al. Ordering the defendant PNB to deliver and release unto the plaintiffs OCT S-V-97.00 at face value.500. defendants-appellees. The Florendos. the trial court rendered a decision. No. plaintiffs-appellants v. Dumaguete City). therefore. No. petitioner. These properties were mortgaged with the Philippine National Bank to secure a loan obtained by the Florendos. GUTIERREZ.232. S-V-97.716. The Florendos were paid under Section 80 of Republic Act 3844 as amended by Section 7 of Presidential Decree 251. however. The Philippine National Bank maintained its stand and refused to approve for registration with the Register of Deeds of Negros Oriental the "Assignment of Rights" and the release of lot No. Florendo. HON.400. TCT T-H-98 and TCT F-T-11 held by them as securities for the plaintiffs loan. and Victoria B. Philippine National Bank.500.31. 1979. redistributed to 31 tenants. Branch IV. TCT T-H-98 and TCT F-T-11 to have been duly paid and satisfied as of August.832. S-V97 could be released to the Land Bank and the "assignment of rights" could be accomplished by the Florendos.00 thus crediting the Florendos with a total sum of P53.31 as full satisfaction of plaintiffs account with the PNB. 13913-CAR entitled Teodoro N. entitled Philippine National Bank.00 the bank was willing to accept only P15.31. F-T-11 and TCT No.832.. 1986 PHILIPPINE NATIONAL BANK. TCT No.31 to pay the outstanding obligation of the Florendos so that the lot covered by OCT No. L-62831-32 July 31.00 at a 40% discount for a total discount of P31.00 in bonds and a check in the amount of P332. the property covered by OCT-S-V-97 was subjected to operation land transfer of the land reform program. and the balance of P79. . Florendo are the registered owners of three parcels of land covered by OCT No. 2. All others were accepted at a discounted rate. et al. Court of Agrarian Relations (12th Regional District. Declaring plaintiff's loan and/or indebtedness with the defendant PNB secured by OCT S-V-97. 1979 remitted to the Philippine National Bank P94. Included in said amount was the Land Bank check of P332.R.500. JR. The value of the land was assessed at P148. defendants-appellants and CA-G. 5. respondents. Plaintiffs-spouses Teodoro N. Declaring the Land Bank bonds worth 194. in a letter dated October 25. the dispositive portion of which reads: WHEREFORE. express their non-conformity with the Philippine National Bank's policy. 3. TEODORO and VICTORIA FLORENDO. Declaring the plaintiffs entitled to the release of all the abovementioned collaterals held by the defendant PNB. 494 for specific performance and damages filed by spouses Teodoro N. Land Bank of the Philippines. Pursuant to this law. Florendo and Victoria B. Hon.R.31 and check in the amount of P332. This parcel of land was. The Philippine National Bank stated that it had a policy of accepting Land Bank bonds on a one to one basis only in so far as property subjected to the agrarian land reform was concerned. Florendo against the Land Bank of the Philippines and the Philippine National Bank and some officers of the two government banks.31 for a total of P94. M-T-98 of the Register of Deeds.: These petitions ask for the review of the Court of Appeals decisions in CA-G. notified the Florendos. that of the total Land Bank bonds of P94. J. judgment is hereby rendered as follows: 1. Negros Oriental.48. No.600. After trial on the merits.. Ordering defendant Land Bank to settle and pay the accounts of the herein plaintiffs with the Development Bank of the Philippines from the remaining balance of the value of the subject property. 13689-SP. Florendo and Victoria B. 4. The Philippine National Bank. Upon the promulgation of Presidential Decree No. The subject matter of both cases was the decision of the Court of Agrarian Relations in CAR Case No. S-V-97 to the Land Bank. the Land Bank on August 9.G. 1979.

D. and 7. No. 13913-CAR and CA-G. THE LATTER IS IN NO POSITION TO DISCHARGE OR RELEASE THE MORTGAGE CONSTITUTED ON OCT-S-V-97. In its joint decision of the two cases. the trial court ordered the issuance of a writ of execution to enforce the decision. NO. On January 12. 13913-CAR. PARTICULARLY SECTION 80 OF THE AGRARIAN REFORM CODE.R. . we issued a temporary restraining order enjoining the Sheriff of the Court of Agrarian Relations. This petition was docketed as CA-G.6. The Florendos and the Philippine National Bank appealed the lower court's decision to the Court of Appeals where the case was docketed as CA-G. AS AMENDED. No.D.R. MUCH LESS ON THE TWO OTHER TITLES. 13689-SP until otherwise ordered by us. DOES NOT APPLY TO LANDS NOT SUBJECTED TO P. Consequently. NO. SAID LANDS ARE NOT COVERED BY AGRARIAN REFORM. No. IN WHICH CASE. In the meantime upon motion of the Florendos. C EVEN IF THE LAND BANK BONDS IN QUESTION WERE TAKEN BY PNB FULLY AT THEIR FACE VALUE. the Philippine National Bank filed a petition for certiorari with preliminary prohibitory injunction to stay the execution and enforcement of the court's decision during the pendency of the appeal.R. the Court of Appeals affirmed the judgment. 1982 and/or the decision of the respondent Court of Appeals in CA-G. The Court of Appeals then issued the prayed for restraining order. 494 by the Court of Agrarian Relations. No pronouncement as to COSTS. 1983. Dismissing the counterclaim of defendant PNB for lack of merit. The Philippine National Bank (PNB) alleges that the respondent Court of Appeals erred in not finding that: A SECTION 80 OF THE AGRARIAN REFORM CODE. Dismissing authorizing other claims of plaintiffs for lack of evidence. Dumaguete City from enforcing or implementing the writ of execution issued by the Court of Agrarian Relations dated January 5. PNB MAY VALIDLY DETERMINE THE MANNER AND CONDITIONS IN WHICH LAND BANK BONDS MAY BE ACCEPTED AS PAYMENTS. 13913-CAR. No.R. The temporary restraining order earlier issued by the court was lifted to enable the immediate enforcement of the writ of execution issued in CAR Case No. PRIVATE RESPONDENTS WOULD STILL REMAIN INDEBTED TO PNB. 27 AND THEREFORE NOT COVERED BY AGRARIAN REFORM. IN WHICH CASE. ACCEPTANCE OF LAND BANK BONDS AS PAYMENTS IS NOT COMPULSORY. 694 (PNB CHARTER) INSTEAD APPLIES TO LANDS OR TO THAT PORTION OF THE MORTGAGE LIEN/ENCUMBRANCE NOT SUBJECTED TO AGRARIAN REFORM. E COURT OF AGRARIAN RELATIONS IS WITHOUT JURISDICTION OVER SUBJECT MATTER OF THE CASE INSOFAR AS THE LANDS NOT SUBJECTED TO P. D SINCE PRIVATE RESPONDENT's LOAN WITH PNB REMAINS UNPAID. B P. 27 ARE CONCERNED.D. NO.

107 SCRA 492). the PNB filed an answer setting up its special and affirmative defenses with counterclaim. without distinction. and (3) whether or not the Land Bank bonds of P94. petitioners cannot now be allowed belatedly to adopt an inconsistent posture by attacking the jurisdiction of the court to which they had submitted themselves voluntarily. Rules and Regulations issued and promulgated in relation to the agrarian reform program. Republic Act 3844 as amended by Presidential Decree 251 applies to lands not covered by Presidential Decree No. (2) whether or not Section 80. Stream lining their Procedures and For Other Purposes) which provides: Section 12. however. — The Bank shall finance the acquisition of farm lots under any of the following modes of settlement: xxx xxx xxx In the event there is an existing lien or encumbrance on the land in favor of any Government tending institution at the time of . only one of the lots was placed under the land reform program and subjected to operation land transfer. — The Court of Agrarian Relations shall have original and exclusive jurisdiction over. In the Court of Agrarian Relations. 494. the parties agreed upon the issues of the case and the PNB never raised the issue on the alleged lack of jurisdiction of the Court of Agrarian Relations. Jurisdiction over Subject Matter.00 at face value to the entire outstanding obligation of the Florendos to the former. 251 subjects not only the loan value but also the outstanding balance of the obligation to settlement with Land Bank bonds. Republic Act 3844. xxx xxx xxx (b) Questions involving rights granted and obligations imposed by laws. are subject to the jurisdiction of the Court of Agrarian Relations. therefore. as amended provides for the modes of payment through the Land Bank of lands placed under the land reform program. Orders. Intermediate (127 SCRA 470) citing the earlier case of Tijam v.The issues raised above are as follows: (1) whether or not the Court of Agrarian Relations had jurisdiction over CAR Case No.A. In fact. Republic Act 3844 as amended by Presidential Decree 251 stems from the PNB's refusal to apply the Land Bank bonds worth P94.R.31 remitted to the PNB are sufficient to pay the fun outstanding obligation of the Florendos to the PNB. clearly falls under Section 12(b) of Presidential Decree No. As we held in Royales v. Instructions. It is to be recalled that while the PNB loan of the Florendos was secured by the mortgage of three lots. the inevitable effect of the placing of only one lot under the land reform program is that all the lots mortgaged.A. The issue raised in relation to Section 80. 27. 494. 946 (Reorganizing the Court of Agrarian Relations. (Gonzales v. Upon this premise. The PNB through its counsel and representative actively participated in all the hearings. they instead invoked the very same jurisdiction by filing an answer and seeking affirmative relief from it.500. Presidential Decrees. the PNB is precluded from raising for the first time on appeal the issue of lack of jurisdiction of the Court of Agrarian Relations over C. The main issue raised in the case was whether or not the PNB should apply the face value of the Land Bank bonds to the outstanding obligation of the Florendos in consonance with Presidential Decree No. The issue of jurisdiction was first raised in the Court of Appeals. they participated in the trial of the case by cross-examining respondent Planas. 251.00 and the Land Bank cheek of P332. Section 80. The pertinent portion reads: Section 80. More important.500. 494. This is specially true in this case because the mode of payment chosen by the Florendos under Presidential Decree No. GSIS. is that the Court of Agrarian Relation had jurisdiction over C. Case No. No. On this score alone. Sibonghanoy (23 SCRA 29): While petitioners could have prevented the trial court from exercising jurisdiction over the case by seasonably taking exception thereto. Modes of payment.R. Following the rule that a mortgage obligation is indivisible and that it cannot be divided among the different lots which are mortgaged to secure it (Gonzales v. What is more. GSIS supra) The case.

A similar settlement may be negotiated by the Land Bank in the case of obligations secured by liens or encumbrances in favor of private parties or institutions. The Land Bank took over and tried to pay the GSIS by remitting P23.00 (loan value of the land placed under PD 27) at face value and the remaining (2) P79. therefore. . GSIS. including accumulated interest.502). we ruled: We find the foregoing asseverations self-serving and in contravention of Presidential Decree No.00 at a discount of 40% reducing its value to only P 47.. it cannot be divided among the different lots.00. The GSIS' refusal to apply the Land Bank bonds at face value to the outstanding obligation of the Gonzales spouses was premised on the argument that the GSIS is not compelled to accept Land Bank bonds for the discharge of existing encumbrances on lands given as security to the GSIS but not acquired by the Land Bank under Presidential Decree No. The Gonzaleses were able to pay only a few monthly installments leaving an unpaid obligation of P135.00 from the respondent GSIS repayable in installments within fifteen years with interest using as collaterals residential lots and two parcels of agricultural land. the GSIS asserted that their Land Bank bonds payments should be applied at face value only to that portion of the loan secured by the land covered by Presidential Decree No. Each and every parcel under mortgage answers for the totality of the debt. filed a case to compel the GSIS to accept the Land Bank bonds at their face value as payment for their outstanding housing loan. It is clear then that it is not only the loan value but the outstanding balance of the obligation that has to be settled with Land Bank bonds. the PNB submits that the Land Bank bonds worth P94. GSIS. it does not render the mortgage of four (4) parcels of land also divisible. at their par or face value.400. This issue has been squarely resolved in the case of Gonzales v. 251. The mortgaged agricultural lands were placed under the land reform program.00 should be applied to the outstanding obligation of the Florendos as follows: (1)P15.82. Under this premise. existing charters of those institutions to the contrary notwithstanding. in a sense.e. (Emphasis supplied) The PNB maintains that under this provision the Land Bank bond payments should be applied at face value only to that extent of the proportionate loan value of the collateral subjected to Presidential Decree No. 27.000.500. the landowner shall be paid the net value of the land (i. if any.600. should be accepted as payments to release the mortgage on the lands not covered by the land reform program at market value or market price pursuant to the PNB Charter. which ordains that "the outstanding balance of the obligations to the lending institution/s shall be paid by the Land Bank in Land Bank bonds or other securities. 107 SCRA 492. The spouses Gonzales obtained a housing loan of P80.500. The mortgage obligation is indivisible. 501. 27 minus the outstanding balance/s of the obligation/s secured by the lien/s or encumbrance/s).00 in Land Bank bonds. earlier cited. A real estate mortgage voluntarily constituted by the debtor on two or more parcels of land is one and indivisible. the value of the land determined under Proclamation (sic) No.acquisition by the Bank. Generally. Although it may be conceded that the obligation of the petitioners is.00 in cash and P93. The fact that only one agricultural land of the four securities was placed under land reform should make no difference. divisible because it can be settled partially according to current practice. The posture taken by PNB is not well-taken.000.505. the full value of the one parcel being paid for by the land Bank should be applied in full to the outstanding loan obligation without any discounting. the divisibility of the principal obligation is not affected by the indivisibility of the mortgage. and the outstanding balance is of the obligations to the lending institutionals shall be paid by the Land Bank in Land Bank bonds or other securities. that is. The GSIS refused acceptance unless the payment in bonds was to be discounted. and as discussed above. 27 and the balance of the bonds. In resolving the issue. 27. (Gonzales v.884. Being indivisible." (emphasis supplied). Like the PNB in the instant petition. The Gonzales spouses.

832.29 as of July 10. the PNB representative testified: ATTY.00 bonds and the check worth P332.00 land bank bonds being valued by PNB at only P 63. judgment is hereby rendered as follows: xxx xxx xxx 5. The questioned decision of the then Court of Appeals is MODIFIED in that Number 5 of the dispositive portion of the decision of the Court of Agrarian Relations which was affirmed by the then Court of Appeals is hereby DELETED.500. Assuming for the sake of argument that we will accept the bond who well pay the excess? The excess is more than P130. In fact that PNB insistence that after the discounting of P94. from Florendos outstanding obligation of P94.62 thus leaving an excess of P31. 1980. The Court of Appeals did not err. REMOLLO: The trouble is the plaintiff is asking for the release of the property. The record is clear that at the time the Land Bank remitted the P94.69.31. (1) the denial of their claim to moral and exemplary damages and (2) the failure of the appellate court to order the Land Bank to pay their indebtedness to the Development Bank of the Philippines (DBP) and release to them their torrens title (OCT-Q-V-22) over another parcel of land free from all liens and encumbrances. the Florendos challenge the decision of the then Court of Appeals on two grounds. 1982 is DISSOLVED. that the then Court of Appeals "affirmed in full" the decision of the Court of Agrarian Relations. WHEREFORE.00 bonds even if applied at face value and the Land Bank check worth P332. according to its computation.31 would not be sufficient to pay the outstanding obligation of the Florendos which. be applied at their face value. xxx xxx xxx Considering our findings on this matter.500.31.00.00 bonds and the check worth P332. namely.31. Ordering the defendant Land Bank to settle and pay the amounts of the herein plaintiffs with the Development Bank of the Philippines from the remaining balance of subject property.500. we rule that the P94. the outstanding obligation of the Florendos to the PNB as agreed upon by both barks was only P94.00 on the outstanding obligation of the Florendos was based on the reason behind their refusal to surrender the titles of the mortgaged properties.00 Land Bank bonds remitted by the Land Bank to the PNB to pay the Florendos' obligation should. this part of the decision of the lower court affirmed by the then Court of Appeals should be deleted. Thus.00 alleged excess was based on the P94.832. in rejecting the unilateral computation of the PNB on the amount of the Florendos' total obligation.00? (TSN.500.500.31 would yield the amount of P 63. 1979. Atty. Remollo.000. Moreover. p. The decision is AFFIRMED in all other respects. there would still be an excess of more than P30.31.000.267. The DBP is not a party in these two petitions. we rule that the Land Bank has no responsibility to pay the Florendos' outstanding obligation to the DBP.499. We agree with the appellate court about there being no clear evidence that the named officers of the two banks acted in a wanton or willful manner in their dealings with Teodoro Florendo which would warrant the award for moral and exemplary damages. SO ORDERED. On the other hand.The P94. It is to be noted. On the second issue. 13) The more than P130. the loan of the Florendos' with the DBP was secured by a parcel of land different from those mortgaged with the PNB.000. The PNB. The temporary restraining order we issued dated January 5. Adding the check worth P332. the instant petitions are DISMISSED for lack of merit.564. The DBP loan was a separate transaction and has nothing to do with the PNB loan. The challenge is not wen taken. Paragraph 5 of the dispositive portion of the decision of the lower court states: WHEREFORE.232. June 24.500. . however. Considering the foregoing. however. insists that the P94.31 remitted by the Land Bank totally discharge the outstanding obligation of the Florendos to the PNB. was P152. therefore.

advised the private respondent of his impending termination on the grounds of inefficiency and loss of trust and confidence. a complaint against the petitioner for injunction with damages with a prayer for a writ of preliminary injunction and/or restraining order. 17740. 1985. its Cebu branch manager and Visayas/Mindanao supervisor. No. resetting the hearing of the joint cases on October 7 and 8. overtime compensation. which transferred to the National Labor Relations Commission the jurisdiction over "all money claims of workers. 1979. 1978. The subsequent motion for reconsideration was denied by the lower court on April 25. the Regional Office issued an order finding the submitted report in order and declaring that the employer-employee relationship between the parties was legally severed and that the respondent was not entitled to separation pay benefits. 1979. Thereafter. The resignation was proposed to take effect on February 15. medicare and maternity benefits. the petitioner filed with the Regional Trial Court a motion to dismiss on the ground that the court lacked jurisdiction over the subject matter of the complaint. on February 6. The motion to dismiss cited the provisions of Presidential Decree No. the lower court denied the petitioner's motion to dismiss. GUTIERREZ." An opposition was filed by the respondent on the grounds that the instant case had been consolidated with Civil Case No. 1691. Summons was served on the petitioner on February 9. the respondent filed with the Regional Trial Court of Cebu. 1979. R-18595.G. in compliance with the then legal requirement filed with the former Department of Labor. the petitioner. promulgated on May 1. J. After the lower court issued an order on August 20. The complaint urged the court to prevent the respondent's termination on the grounds that the causes alleged by the petitioner were false and fabricated and that any termination would be unlawful because he had already tendered his resignation. JR. On November 7. he was given the option to resign and possibly receive a little gratuity or wait for the termination order and risk criminal charges. 1980.. vs. 1968 as a salesman and later as a sales supervisor for eastern Visayas and northern Mindanao. dated November 7. On January 22. petitioner.: This is a petition for certiorari and prohibition with preliminary injunction to review and annul the orders of the Regional Trial Court of Cebu. 1979. 7. This order was subsequently affirmed by the National Labor Relations Commission. After the effectivity of respondent's resignation. the petitioner in a memorandum sent through Mr. 1985. 2974. On January 4. the petitioner accepted respondent's resignation effective at the close of business hours on February 15. except claims for employee's compensation. 1691 was approved. 1985. separation pay and other benefits provided by law or appropriate agreement. Emiliano C. 1985. On March 20. 1987 ATLAS FERTILIZER CORPORATION. 1983. and EMILIANO BELLEZA. 1982. Belleza" and a joint trial thereof had been started and that at the time Presidential Decree No. 1979. the petitioner went to this Court on petition for certiorari and prohibition with pre injunction on September 23. Beneza was employed by petitioner Atlas Fertilizer Corporation in May. 1979. Meanwhile. Branch XX. which respectively denied the petitioner's motion to dismiss and motion for reconsideration in Civil Case No. this case had already been filed with the respondent court. all amounting to loss of trust and confidence. 1979. entitled "Atlas Fertilizer Corporation v. Branch XX. On January 8. The respondent's motion for reconsideration was denied in an order dated August 1. Rosendo Estoye. HON. Rosendo Estoye sent to the respondent a memorandum giving the latter seventy-two (72) hours to explain why he should not be terminated on the grounds of acts inimical to the interest of the petitioner and gross dishonesty. Private respondent Emiliano C. being incompatible with his resignation. the private respondent filed his resignation letter addressed to the petitioner's executive vicepresident and vice-president for sales. social security. 1979. . EXALTACION NAVARRO in her capacity as Presiding Judge of Branch XX of the Regional Trial Court of Cebu. The petitioner likewise informed the respondent that his claim for termination pay was denied. On November 29. 72074 April 30. Regional Office No.R. its report docketed as TFU Case No. On December 26. 1979. the petitioner duly filed its Answer and Amended Answer. including those based on non-payment or underpayment of wages. 1983 and April 25. 1985. respondents. In the same memorandum.

social security. whether agricultural or non-agricultural: b) Unfair labor practice cases. et al. Against this view. 23 SCRA 1227). Inciong (91 SCRA 248. 31 Okla. including those Chat involve wages. the applicable law was Section 1 of Presidential Decree No. on May 1. Insurance Company of North America v. It is a general rule that the jurisdiction of a court is determined by the statute enforced at the time of the commencement of the action (People v. Presidential Decree No. it cannot be applied to a case that was pending prior to the enactment of the statute (Mullen v. in the case of Bengzon v. The exception to the rule is where the statute expressly provides. this Court held: The rule is that where a court has already obtained and is exercising jurisdiction over a controversy. Unresolved issues in collective bargaining. the respondent maintains that jurisdiction once acquired by a court over a case remains with it until the full termination of the case. whether a agricultural cultural or non-agricultural: 1. Renzleman. However. 3. 71 SCRA 600. However. 222 and 262 of Book V of the labor Code are hereby amended to read as follows: ART. 1367 wherein the courts were vested with jurisdiction over claims for moral and other forms of damages arising from employer-employee relationship. 234. 1367. 119 P. Fontanilla. that the Regional Directors shall not indorse and Labor Arbiters shall not entertain claims for moral or other forms of damages. -(a) The Labor Arbiters shall have the original and exclusive jurisdiction to hear and decide the following cases involving 11 workers. Admittedly. Labes. Mariano.. the same jurisdiction was divested when Presidential Decree No 1691 superseded Presidential Decree No. its jurisdiction to proceed to the final determination of the cause is not affected by new legislation placing jurisdiction over such proceedings in another tribunal (lburan v. 3. 2d. during the pendency of this case. hours. 1691 was promulgated.. Where a statute change the jurisdiction of a court has no retroactive effect. of work and other terms and conditions of employment. overtime compensation. at the time when the respondent filed this case with the respondent lower court. including those which involve wages. Provided. and . 217. which provides as follows: Section 1. 1980. Jur. . People v. 17 SCRA 301). separation pay and other benefits provided by law or appropriate agreement. hours of work and other terms and conditions of employment. Section 150). 53. medicare and maternity benefits. All money claims of workers. c) Unresolved cases in collective bargaining. Cases involving household services. including those based on non-payment or underpayment of wages.The issue put forward by the petitioner is whether or not regular courts have jurisdiction to entertain labor cases including those involving claims for moral and other damages. 1367 during the pendency of the case. 256). It amended the above-quoted provisions as follows: Sec. Unfair labor practice cases: 2. 641). 87 Phil. Paragraph (a) of Article 217 of the Labor Code as amended is hereby further amended to read as follows: a) The Labor Arbiter shall have exclusive jurisdiction to hear and decide the following cases involving all workers. except claim s for employees compensation. and d) All other cases arising from employer-employee relations duly indorsed by the Regional Directors in accordance with the provisions of this code. Commission . Jurisdiction of Labor Arbiters and the. The petitioner alleges that although the case was filed during the effectivity of Presidential Decree No. or is construed to the effect that it is intended to operate as to actions pending before its enactment (20 Am. The following considerations impel us to uphold the petitioner's view. 4. United States Lines Company. Articles 217.

Inc. 1367 itself was given retroactive application. vesting on the labor arbiters jurisdiction over cases that workers may file involving wages. on May 1." This construction of law is not new. cited by the petitioner.5. this Court held in the cases of Ebon v. 1980.D. De Guzman supra.. the complaint for recovery of termination pay. other employment benefits. and exemplary damages arising from the plaintiff's dismissal as a manager of a radio station. Inc. hours of work and other terms and conditions of employment and all money claims of workers. 90 SCRA 331. should be given a retrospective application to the pending proceedings. Bautista. 1978 (Abad v. P. Co. Inc.D. 1367 and restored to the Labor Arbiters and the NLRC . 1691 (which substantially reenacted Article 217 in its original form) nullified Presidential Decree No.. 1367. social security. Co. Presidential Decree No. v. In said case.D. P. in the case of Garcia v. which was filed on August 2. therefore. therefore. v. this Court held: The lawmaker in divesting the Labor Arbiters and the NIRC of jurisdiction to award moral and other forms of damages in labor cases could have assumed that the Labor Arbiters' position-paper procedure of ascertaining the facts in dispute might not be an adequate tool for arriving at a just and accurate assessment of damages.. Co. xxx xxx xxx Presidential Decree No.. 1691 merely restored a jurisdiction earlier vested in Labor Arbiters before the enactment of P. Amor. 1980 End when it reconsider dered and set aside said Order of dismissal on April 9.. other reimburseable expenses. said Article was amended anew by Batas Pambansa Blg. 1691 was again amended by Batas Pambansa Blg. Court of Appeals (116 SCRA 86). 1981 and reinstated the case on its docket. v.. 130 which took effect on August 21.D. 1367. compulsory arbitrators. 108 SCRA 717).. Evidently. this Court ordered the dismissal of the complaint on the ground that "P. the lawmaking authority had second thoughts about depriving the Labor Arbiters and the NLRC of the jurisdiction to award damages in labor cases because that setup would mean duplicity of suits. be given a retroactive application to this pending case as the precise purpose of the amendment was to hopefully settle once and for all the conflict of jurisdiction between regular courts and labor agencies (Sentinel Incs.. Inc. SCRA 459 and Abad v. Vallejos (113 SCRA 69). and Court of Appeals. except money claims for employees' compensation. This ruling was reiterated in the more recent case of Calderon Sr. allowances. Bautista. Aguda v.D. It was intended to correct a situation where two tribunals would have jurisdiction over separate issues arising from the same labor conflict. v. 1979 in Garcia v.. In Ebon v. De Guzman (113 SCRA 52). Calderon v. On April 9. Does Presidential Decree No. On review. and damages.employee-relations. for also being curative in nature. Phils. (100 SCRA 459) where we held that the Court of First Instance of Rizal had jurisdiction over the complaint for recovery of unpaid salaries. All other claims arising from employer.. moral. the dismissal order was set aside on a motion for reconsideration. Martinez (90 SCRA 331) where this Court ruled that the Court of First Instance of Davao City had jurisdiction over the complaint for actual. Bautista. Philippine American General Inc. v. 108 SCRA 717). and that the trial procedure in the Court of First Instance would be a more effective means of determining such damages (See Resolution of May 28. The Philippine American General Incs. On June 1. 1982.D. 1691 have a retroactive effect in the instant case? In conflicts of jurisdiction between the courts and the labor agencies arising from the amendments effected by P. Inc. It must be noted that the amendatory provision of P. and Sentinel Insurance Co. 127 SCRA 623. 1691 on P. The complaint was dismissed for lack of jurisdiction on December 5. So. et al.D. 1979 with the Court of First Instance of Negros Oriental. 1691 is a curative statute which corrected the lack of jurisdiction of the Labor Arbiter at the start of the proceedings and. as distinguished from backwages and separation pay. that P.629). 1976. Court of Appeals. 1981.and voluntary arbitrators in appropriate cases provided in Article 263 of this Code. This is also our ruling in the case of Getz Corp.D. and damages was filed on March 20. 1691 should. unless expressly excluded by this Code. 227. 1981. Martinez. (b) The Commission shall have exclusive appellate-jurisdiction over all cases decided by Labor Arbiters. 1367 was no longer applicable when the trial court dismissed the case for lack of jurisdiction on December 5. which was filed on March 3. medicare and maternity benefits (Sentinel Insurance Co.. (supra). supra).. splitting the cause of action and possible conflicting findings and conclusions by two tribunals on one and the same claim. 1980.

55703. Inc. (L-27953. the choice should fan on [an administrative agency]. SO ORDERED.. 58877). Sibonghanoy (23 SCRA 29) doctrine. 17740 without prejudice to the right of the respondent to refile his case with the proper labor agency. the damages that may be incurred by either labor or management as a result of disputes or controversies arising from employer-employee relations. G. the ruling in Philippine Overseas Drilling and Oil Development Corporation (PODCO) v. the unmistakable trend has been to refer it to the former. jurisdiction was raised as the issue from the very start. Martinez. the tribunals involved in the PODCO case are both labor tribunals. In his opposition.their jurisdiction to award all kinds of damages in cases arising from employer-employee relations (Pepsi-Cola Bottling Company of the Philippines v. The money claim came about only because the employee interposed an opposition to the application for clearance. therefore. No. More important. In the abovecited PODCO case. The PODCO case involved a clearance to terminate an employee.R. history has vindicated the view that in the appraisal of what was referred to by Philippine American Management & Financing Co. made clear that the exclusive and original jurisdiction for damages would once again be vested in labor arbiters. Thus: 'Increasingly. It can be affirmed that even if they were not that explicit. v.R. the present Labor Code is even more committed to the view that on policy grounds. ruled that regardless of the merits of the jurisdiction issue. 48 SCRA 187) as 'the rather thorny question as to where in labor matters the dividing line is to be drawn' (lbid. November 29. Only in its petition before this Court was the issue of jurisdiction raised. however. Furthermore. this Court has been committed to the view that unless the law speaks clearly and unequivocably. we sustained the jurisdiction of the Director. No. We. this Court held: The issuance of Presidential Decree No. 1986) was discussed. 1691 and the enactment of Batas Pambansa Blg.. November 27. et al (G. There are certain factual and other differences between the PODCO case and this petition. Inc. the petitioner was barred by estoppel from raising it before us. with expertise in matters involving employer-employee relations. In the instant petition. . Ministry of Labor. Apart from the factual differences. 91) between the power lodged in an administrative body and a court. The respondent judge is directed to dismiss Civil Case No. IN VIEW OF THE FOREGOING. the petitioner in that case did not raise any question of jurisdiction in its motion for reconsideration or in its appeal to the Minister of Labor. Certainly. Bureau of Labor Relations to hear and decide a claim for separation pay arising from employer-employee relations inspire of the enactment of an amendatory decree granting Labor Arbiters the original and exclusive jurisdiction over all money claims arising out of such relationships. applying the Tijam v. Management & Supervisors Association of the Philippine-American Management & Financing Co. the petition is GRANTED and the orders of the respondent court are hereby SET ASIDE. 1972. a court is spared the often onerous task of determining what essentially is a factual matter. 130. namely. Eisma (127 SCRA 419). the employee charged the employer with unfair labor practise and undue discrimination arising from its refusal to grant separation pay. and equally so in the interest of greater promptness in the disposition of labor matters. During the deliberations on this petition. in the case of National Federation of Labor v.

R. OFFICE OF THE SPECIAL PROSECUTOR. They contend that the said law limited the jurisdiction of the Sandiganbayan to cases where one or more of the "principal accused" are government officials with Salary Grade (SG) 27 or higher. asserting that under the amended informations. the Sandiganbayan allowed them to file a motion for 4 reconsideration of the Ombudsman's action. 1999 PANFILO M. Bienvenido Blancaflor. to investigate the incident. 1996 eleven (11) amended informations before the Sandiganbayan. Central Police District Command (CPDC) led by Chief Superintendent Ricardo de Leon. Upon motion by all the accused in the 11 information. Ombudsman Aniano Desierto formed a panel of investigators headed by the Deputy Ombudsman for Military Affairs. 7975. or PNP officials with the rank of Chief Superintendent (Brigadier General) or higher. Thus. No. joined by petitioners-intervenors Romeo Acop and Francisco Zubia. ZUBIA. and THE PEOPLE OF THE PHILIPPINES. with a finding that the 1 said incident was a legitimate police operation..: The constitutionality of Sections 4 and 7 of Republic Act No. petitioner. Lacson. Jr. and the Criminal Investigation Command (CIC) headed by petitioner-intervenor Chief Superintendent Romeo Acop. MARTINEZ. respondent. 8249 — an act which further defines the jurisdiction of the Sandiganbayan — is being challenged in this petition for prohibition and mandamus. and other. petitioner-intervenors. One of the accused was dropped from the case. The antecedents of this case. J. all the accused filed separate motions questioning the jurisdiction of the Sandiganbayan. 1995. The recommendation was approved by the Ombudsman except for the withdrawal of the charges against Chief Supt. Jr. were among those charged in the same informations as accessories after-in-the-fact. wherein petitioner was charged only as an accessory. also seeks to prevent the Sandiganbayan from proceedings with the trial of Criminal Cases Nos. Petitioner Panfilo Lacson. reportedly an organized crime syndicate which had been involved in a spate of bank robberies in Metro Manila.. Jr. as gathered from the parties' pleadings and documentary proofs. a review board led by Overall Deputy Ombudsman Francisco Villa modified modified the Blancaflor panel's finding and recommended the indictment for multiple murder against twenty-six (26) respondents. 1995 was a summary execution (or a rub out) and not a shoot-out between the Kuratong Baleleng gang members and the ABRITG. vs. On March 5-6. THE SANDIGANBAYAN. LACSON. the cases fall within the jurisdiction of the Regional Trial Court 7 pursuant to Section 2 (paragraphs a and c) of Republic Act No. ACOP AND FRANCISCO G. Acting on a media expose of SPO2 Eduardo delos Reyes. ROMEO M. the Ombudsman filed on March 1. 5 3 . 1995. are as follows: In the early morning of May 18. IMELDA PANCHO MONTERO. However.G. where slain along Commonwealth Avenue in Quezon City by elements of the Anti-Bank Robbery and Intelligence Task Group (ABRITG) headed by Chieff Superintendent Jewel Canson of the Philippine National Police (PNP). eleven (11) persons believed to be members of the Kuratong Baleleng gang. including herein petitioner and intervenors. MYRNA ABALORA. THE DEPARTMENT OF JUSTICE. 1996. Jr. This panel later absolved from any criminal liability all the PNP officers and personal allegedly involved in May 18. 23047-23057 (for multiple murder) against them on the ground of lack of jurisdiction. a member of the CIC. while intervenors Romeo Acop and Francisco Zubia. After conducting a reinvestigation.. petitioner Panfilo Lacson was among those charged as principal in eleven (11) 2 information for murder before the Sandiganbayan's Second Division. JR. 1995 incident. Presidential Anti-Crime Commission — Task Force Habagat (PACC-TFH) headed by petitioner Chief Superintendent Panfilo M. THE EXECUTIVE SECRETARY. NENITA ALAP-AP. 128096 January 20. together with Romeo Acop and Francisco 6 Zubia. Ricardo de Leon. The ABRITG was composed of police officers from the Traffic Management Command (TMC) led by petitioner-intervenor Senior Superintendent Francisco Zubia. that what actually transpired at dawn of May 18. on November 2.

Gonzales II. xxx xxx xxx Considering that three of the accused in each of these cases are PNP Chief Superintendents: namely. as well as Senate Bill No. defining expanding the jurisdiction of the Sandiganbayan. from the way the Sandiganbayan has footdragged for nine (9) months the resolution of a pending incident . 1996. the Sandiganbayan promulgated a Resolution denying the motion for reconsideration of the Special Prosecutor. 8249. No. Jr. 1997. Jewel T. but before Justice de Leon." On the same day of which reads: 15 14 the Sandiganbayan issued and ADDENDUM to its March 5. ruling that it "stands pat in its resolution dated May 8. were introduced in Congress. thereby violating his right to procedural due process and the equal protection clause of the Constitution.A. 7975. respectively). insisting that the cases should remain with the Sandiganbayan. Lagman and Lagman and Neptali M. This was opposed by petitioner and some of the accused. Justices Lagman and Demetriou are now in favor of granting. House Bill No. the net result of all the foregoing is that by the vote of 3 of 2. retained jurisdiction to try and decide the cases (Empahasis supplied) Petitioner now questions the constitutionality of Section 4 of R. 7975. 1997. 1997 Resolution. Specifically. 1996). on March 5." Petitioner argues that: a) The questioned provisions of the statute were introduced by the authors thereof in bad faith as it was made to precisely suit the situation in which petitioner's cases were in at the Sandiganbayan by restoring jurisdiction thereof to it. including Section 7 thereof which provides that the said law "shall apply to all cases pending in any court over which trial has not begun as to the approval hereof. No. the Sandiganbayan admitted the amended information and ordered the cases transferred to the Quezon City Regional Trial Court which has original and exclusive jurisdiction under R. 2299 and No. and Justices Balajadia and Garchitorena dissenting. 1997. no order of arrest has been issued — this court has competence to take cognizance of these cases. To recapitulate. Lacson. rendered his concurring and dissenting opinion.The highest ranking principal accused in the amended informations has the rank of only a Chief Inspector. the pertinent portion After Justice Lagman wrote the Resolution and Justice Demetriou concurred in it. 1996. No. as they are now granting. 8249 February 5. Acop and Panfilo M. These bills were consolidated and later approved into law as R. Considering the pertinent provisions of the new law. Canson. Further.A. Thereafter. and even before the issue of jurisdiction cropped up 10 11 with the filing of the amended informations on March 1. among others. 12 844 (sponsored by Senator Neptali Gonzales).A. and that trial has not yet begun in all these cases — in fact. in a Resolution dated May 8. 1996. 1094 (sponsored by Representatives Edcel C.A. with 9 Justices Lagman and de Leon concurring. penned by Justice Demetriou. 1996 (promulgated on May 9. the legislature enacted Republic Act 8249 and the President of the Philippines approved it on February 5. 13 8 by the President of the Philippines on Subsequently. the Office of the Special Prosecutor moved for a reconsideration. On May 17. the Special Prosecutor's motion for reconsideration. and none has the equivalent of at least SG 27. Romeo M. the said bills sought. as none of the principal accused has the rank of Chief Superintendent or higher. Justice de Leon has already done so in his concurring and dissenting opinion. to amend the jurisdiction of the Sandiganbayan by deleting the word "principal" from the phrase "principal accused" in Section 2 (paragraphs a and c) of R. the court admitted the Amended Informations in these cases by the unanimous vote of 4 with 1 neither concurring 16 not dissenting. While these motions for reconsideration were pending resolution.

the intervenors. Section 4: Sec. Article VI of the Constitution. 8249 innocuously appears to have merely expanded the jurisdiction of the Sandiganbayan. The Batasang Pambansa shall create a special court. They further argued that if their case is tried before the Sandiganbayan their right to procedural due process would be violated as they could no longer avail of the two-tiered appeal to the Sandiganbayan. filed the required supplemental memorandum within the nonextendible reglementary period. in their petition-in-intervention. which provides: Sec. before recourse to the Supreme Court. 5. The said special court is retained in the new (1987) Constitution under the following provisions in Article XI. The established rule is that every law has in its favor the presumption of constitutionality. The present anti-graft court known as the Sandiganbayan shall continue to function and exercise its jurisdiction as now or hereafter may be provided by law. 7975. namely. c) The title of the law is misleading in that it contains the aforesaid "innocuous" provisions in Sections 4 and 7 which actually expands rather than defines the old Sandiganbayan law (RA 7975).involving the transfer of the cases to the Regional Trial Court. in relation to their office as may be determined by law. the passage of the law may have been timed to overtake such resolution to render the issue therein moot. which they acquired under R. to be known as Sandiganbayan. to make certain that those cases will no longer be remanded to the Quezon City Regional Trial Court. we regret to say. except for the Solicitor General who is representing the People of the Philippines. 19 . was not convincingly discharged in the present case. 23047-23057 sufficiently allege the commission by the accused therein of the crime charged within the meaning Section 4 b of Republic Act No. as the Sandiganbayan alone should try them. 4. which shall have jurisdiction over criminal and civil cases involving graft and corrupt practices and such other offenses committed by public officers and employees including those in government-owned or controlled corporations. That burden. The creation of the Sandiganbayn was mandated in Section 5. Both the Office of the Ombudsman and the Solicitor-General filed separate pleadings in support of the constitutionality of the challenged provisions of the law in question and praying that both the petition and the petition-in-intervention be dismissed. thus making it an ex post facto legislation and a denial of the right of petitioner as an accused in Criminal Case Nos. and frustrate the exercise of petitioner's vested rights under the old Sandiganbayan law (RA 7975) b) Retroactive application of the law is plan from the fact that it was again made to suit the peculiar circumstances in which petitioner's cases were under. 23047-23057 to procedural due process. This Court then issued a Resolution requiring the parties to file simultaneously within a nonextendible period of ten (10) days from notice thereof additional memoranda on the question of whether the subject amended informations filed a Criminal Case Nos. 8249. and to justify its nullification 20 there must be a clear and unequivocal breach of the Constitution. thereby violating the one-title one-subject requirement for the passage of 17 statutes under Section 26 (1). Article XIII of the 1973 Constitution. so as to bring the said cases within the exclusive original jurisdiction of the Sandiganbayan. add that "while Republic Act No. not a doubtful and argumentative one. The parties. The burden of proving the invalidity of the law lies with those who challenge it. as provided in Section 7. For their part. that the trial had not yet commenced.A. the introduction of Section 4 and 7 in said statute impressed upon it the character of a class legislation and an ex-post facto statute intended to apply specifically 18 to the accused in the Kuratong Baleleng case pending before the Sandiganbayan.

1606.D. Section 4 of the same decree [P. Violations of Republic Act No. and provincial treasurers. (3) Members of the judiciary without prejudice to the provisions of the Constitution. (d) Philippine Army and air force colonels. Thereafter. in chronological order. as amended. assessors. and officials and prosecutors in the Office of the Ombudsman and special prosecutor. members of the sangguniang panlalawigan. whether in a permanent. members of the sangguniang panlungsod.A. Section 20 of Batas 23 24 25 26 27 Pambansa Blg. directors or trustees or managers of government-owned or controlled corporations. 123. Under the latest amendments introduced by Section 4 of R. the Sandiganbayan has jurisdiction over the following cases: Sec 4. No. at the time of the commission of the offense: (1) Officials of the executive branch occupying the positions of regional director and higher. Section 2. 21 . No. No. 6758). 4. state universities or educational institutions or foundations. Book II of the Revised Penal Code. naval captains. and Chapter II. vice-governors. and R. (2) Members of Congress or officials thereof classified as-Grade "27" and up under the Compensation and Position Classification Act of 1989. and other provincial department heads. where one or more of the accused are officials occupying the following positions in the government. R. No. 1860.Pursuant to the constitutional mandate. No.D.A. as amended] is hereby further amended to read as follows: Sec. engineers. 8249. engineers. (g) Presidents. assessors. of the Compensation and Position Classification Act of 1989 (Republic Act No. were enacted: P. (c) Officials of the diplomatic service occupying the position of consul and higher. (e) Officers of the Philippines National Police while occupying the position of provincial director and those holding the rank of senior superintendent or higher. 1606. and all officers of higher rank. the 22 following laws on the Sandiganbayan. specifically including: (a) Provincial governors.D. No. acting or interim capacity. (b) City mayors. 7975. 8249. Titile VII. and other city department heads. Presidential Decree No. city treasurers. Jurisdiction — The Sandiganbayan shall exercise exclusive original jurisdiction in all cases involving: a. (4) Chairman and members of the Constitutional Commissions. 1861. otherwise classified as Grade "27" and higher. P.A. No. P.D. otherwise known as the Anti-Graft and Corrupt Practices Act. without prejudice to the provisions of the Constitution. Republic Act No. 3019. 1379. (f) City of provincial prosecutors and their assistants. vice-mayors. 1486 created the Sandiganbayan.

b. including quo warranto. 2. xxx xxx xxx (Emphasis supplied) Sec. c. prohibition. The procedure prescribed in Batas Pambansa Blg. Other offenses or felonies whether simple or complexed with other crimes committed by the public officials and employees mentioned in Subsection a of this section in relation to their office. 14. The Sandiganbayan shall have exclusive original jurisdiction over petitions of the issuance of the writs of mandamus. as amended. they shall be tried jointly with said public officers and employees in the proper courts which shall exercise exclusive jurisdiction over them. and 4-A.A. 7975. 1.2. as well as the implementing rules that the Supreme Court has promulgated and may hereafter promulgate. In case private individuals are charged as co-principals. injunctions. 1. No. 2. Civil and criminal cases filed pursuant to and connection with Executive Orders Nos. 14 and 14-A.(5) All other national and local officials classified as Grade "27" or higher under the Compensation and Position Classification Act of 1989. issued in 1986. 7. including those employed in government-owned or controlled corporations. 1606. Section 4 of the same decree [Presidential Decree No. (Emphasis supplied) The Sandiganbayan law prior to R.A. 129. issued in 1986. metropolitan trial court. 2. as amended) is hereby further amended to read as follows: . and municipal circuit trial court. 14 and 14-A. as the case may be. except in cases filed pursuant to Executive Order Nos. That the jurisdiction over these petitions shall not be exclusive of the Supreme Court. arising or that may arise in cases filed or which may be filed under Executive Order Nos. The Sandiganbayan shall exercise exclusive appellate jurisdiction over final judgments. 8249 states: Sec. habeas corpus. through its special prosecutor. the Office of the Ombudsman. and other ancillary writs and processes in aid of its appellate jurisdiction and over petitions of similar nature. resolutions or orders of regional trial courts whether in the exercise of their own original jurisdiction or of their appellate jurisdiction as herein provided.A. relative to appeals/petitions for review to the Court of Appeals. In all cases elevated to the Sandiganbayan and from the Sandiganbayan to the Supreme Court. issued in 1986: Provided. 1.A. 8249 was R. In cases where none of the accused are occupying positions corresponding to salary Grade "27" or higher. Transitory provision — This act shall apply to all cases pending in any court over which trial has not begun as of the approval hereof. pursuant to their jurisdictions as privided in Batas Pambansa Blg. 129. Section 2 of R. 7 of R. certiorari. 7975 provides: Sec. shall represent the People of the Philippines. municipal trial court. as prescribed in the said Republic Act 6758. or military and PNP officers mentioned above. accomplices or accessories with the public officers or employee. exclusive original jurisdiction thereof shall be vested in the proper regional trial court. shall apply to appeals and petitions for review filed with the Sandiganbayan.

(5) All other national and local officials classified as Grade "27" or higher under the Compensation and Position Classification Act of 1989. and Chapter II. and provincial treasurers. (g) Presidents. 3019. (d) Philippine Army and air force colonels. and all officers of higher rank. engineer. members of the sangguniang panlungsod. assessors. naval captains. Book II of the Revised Penal Code. (e) PNP chief superintendent and PNP officers of higher rank. (f) City and provincial prosecutors and their assistants. vice-governors. Section 2. assessors. where one or more of the pricipal accused are afficials occupying the following positions in the government. members of the sangguniang panlalawigan. Jurisdiction — The Sandiganbayan shall exercise exclusive original jurisdiction in all cases involving: a. otherwise classified as Grade "27" and higher. without prejudice to the provisions of the Constitution. engineers. otherwise known as the Anti-Graft and Corrupt Practices Act. 1379. and other city department heads. as amended. of the Compensation and Position Classification Act of 1989 (Republic Act No. state universities or educational institutions or foundations. Other offenses or felonies committed by the public officials and employees mentioned in Subsection a of this section in relation to their office. (b) City mayors. (2) Members of Congress or officials thereof classified as Grade "27" and up under the Compensation and Position Classification Act of 1989. acting or interim capacity. specifically including: (a) Provincial governors. . (3) Members of the judiciary without prejudice to the provisions of the Constitution. and other provincial department heads.Sec 4. and officials and prosecutors in the Office of the Ombudsman and special prosecutor. (4) Chairman and members of the Constitutional Commissions. directors or trustees. b. (c) Officials of the diplomatic service occupying the position of consul and higher. Title VII. Republic Act No. vice-mayors. whether in a permanent. at the time of the commission of the offense: (1) Officials of the executive branch occupying the positions of regional director and higher. or managers of government-owned or controlled corporations. Violations of Republic Act No. city treasurers. 6758).

relying on R.A. 7. they shall be tried jointly with said public officers and employees in the proper courts which shall have exclusive jurisdiction over them. No. 2.A. Upon the effectivity of this Act. 1. 8249) in relation to their office. 1379 (the law on ill-gotten wealth). 1606 which does not mention the criminal participation of the public officer as a requisite to determine the jurisdiction of the Sandiganbayan. what determines the Sandiganbayan's jurisdiction is the official position or rank of the offender — that is. pursuant to their respective jurisdictions as provided in Batas Pambansa Blg. (c) Chapter II.A. Section 4 of R. (d) Executive Order Nos.A. 7975 reads: Sec. as the case may be. 129. 14. Considering that herein petitioner and intervenors are being charged with murder which is a felony punishable under Title VIII of the Revised Penal Code. Under paragraphs a and c. and 4-A.c. The Sandiganbayan shall exercise exclusive appellate jurisdiction on appelas from the final judgment. 3019. 7 of R. 8249. b and c of the same Section 4 do not make any reference to the criminal participation of the accused public officer as to whether he is charged as a principal. . 1. Section 4 of R.A. 8249. Civil and criminal cases files pursuant to and in connection with Executive Order Nos. In cases where none of the principal accused are occupying positions corresponding to salary Grade "27" or higher. or (e) other offenses or felonies whether simple or complexed with other 32 crimes. provided it was committed in relation to the accused's officials functions. the following requisites must concur: (1) the offense committed is a violation of (a) R. (2) the offender comitting the offenses in items (a). (c) and (e) is a public official or employee holding any of the positions enumerated in paragraph a of Section 4. as presribed in the said Republic Act 6758. 8249 reveals that to fall under the exclusive original jurisdiction of the Sandiganbayan.A. argue that the Regional Trial Court. "The phrase" other offenses or felonies" is too broad as to include the crime of murder.D. resolutions or orders of regular court where all the accused are occupying positions lower than grade "27. 8249. as amended (the Anti-Graft and Corrupt Practices Act). Thus. This paragraph b pertains to "other offenses or felonies whether simple or complexed with other crimes committed by the public officials and employees mentioned in subsection a of (Section 4. Title VII. the Congress simply restored the original provisions of P. was deleted. or their equivalent. 2. 14. has jurisdiction over the subject criminal cases since none of the principal accused under the amended information has the rank of 28 Superintendent or higher. under said paragraph b.A. xxx xxx xxx (Emphasis supplied) Sec. Book II of the Revised Penal Code (the law on bribery). It is due to this deletion of the word "principal" that the parties herein are at loggerheads over the jurisdiction of the Sandiganbayan. R.A. The offenses mentioned in pargraphs a. whether he is one of those public officers or employees enumerated in paragraph a of Section 4. or PNP officers occupying the rank of superintendent or higher. accomplices or accessories with the public officers or employees. and (3) the offense committed is in relation to the office. xxx xxx xxx In case private individuals are charged as co-principals. Petitioner and intervenors. the Office of the Ombudsman. the word "principal" before the word "accused" appearing in the above-quoted Section 2 (paragraphs a and c) of R. A perusal of the aforequoted Section 4 of R. 8249. and 14-A. through the Special Prosecutor who is 29 tasked to represent the People before the Supreme Court except in certain cases. Section 30 2. 7975." or not otherwise covered by the preceding enumeration. contends that the Sandiganbayan has jurisdiction pursuant to R. 7975. not the Sandiganbayan. (b) R. On the other hand.A. the governing on the jurisdictional offense is not paragraph a but paragraph b. 31 issued in 1986 (sequestration cases). (b). and municipal circuit trial court. exclusive jurisdiction thereof shall be vested in the proper regional trial court. In enacting R. municipal trial court. all criminal cases in which trial has not begun in the Sandiganbayan shall be referred to the proper courts.A.A. accomplice or accessory. metropolitan trial court. including those employed in government-owned or controlled corporations.

Precisely. Every classification made by law is presumed reasonable. Thus. petitioner and intervenors cannot now claim that Sections 4 and 7 placed them under a different category from those similarly situated as them. (2) it must be germane to the purpose of the law." It just happened that Kuratong Baleleng cases are one of those affected by the law. as against those cases where trial had already started as of the approval 36 of the law. evidence against them were not yet presented. in its plenary legislative powers." Contrary to petitioner and intervenors' argument. 8249. examined witnesses and presented documents. the law is not particularly directed only to the Kuratong Baleleng cases.A. those cases where trial had already begun are not affected by the transitory provision under Section 7 of the new law (R. In the first instance. to "all cases pending in any court.A. Since it is within the power of Congress to define the jurisdiction of courts 37 subject to the constitutional limitations. 8249 failed to rebut the presumption of constitutionality and reasonables of the questioned provisions. 8249. the same would not constitute sufficient justification to nullify an otherwise valid law. 1606. On the perceived bias that the Sandiganbayan Justices allegedly had against petitioner during the committe hearings. as amended.D. and (4) must apply equaly to all members of the same class. In Calder v. finally. Thus. was acted. namely: (1) it must rest on substantial distinction. The classification between those pending cases involving the concerned public officials whose trial has not yet commence and whose cases could have been affected by the amendments of the Sandiganbayan jurisdiction under R. 7975.A. and was separately approved by the Senate and House of Representatives and. Petitioner and entervenors further further argued that the retroactive application of R.Petitioner and entervenors' posture that Section 4 and 7 of R. 8249).A. 8249 violate their right to equal protection of the law because its enactment was particularly directed only to the Kuratong Baleleng cases in the Sandiganbayan. is particularly empowered by the Constitution to invite persons to appear before it 40 whenever it decides to conduct inquiries in aid of legislation. R. There is nothing ex post facto in R. Again. 8249. Their presence and participation in the legislative hearings was deemed necessary by Congress since the matter before the committee involves the graft court of which one is the head of the Sandiganbayan and the other a member thereof. law is one — 42 an ex post facto . deliberated. (3) must not be limited to existing conditions only.A. 35 33 The challengers of Sections 4 and 7 of R. this contention is erroneous. whereas in the latter the parties had already submitted their respective proofs. it is stressed that the Senator had expressed strong sentiments against those officials involved in the Kuratong Baleleng cases during the hearings conducted on the matter by the committee headed by the Senator. No concrete evidence and convincing argument were presented to warrant a declaration of an act of the entire Congress and signed into law by the highest officer of the co-equal executive department as unconstitutional.A.A. rests on substantial distinction that makes real differences. Section 4 of 39 P. The classification is reasonable and not arbitrary when there is concurrence of four elements. Moreover. Bull. paragraph a of Section 4 provides that it shall apply to "all case involving" certain public officials and. 8249 to the Kuratong Baleleng 41 cases constitutes an ex post facto law for they are deprived of their right to procedural due process as they can no longer avail of the two-tiered appeal which they had allegedly acquired under R. The Congress. It is an established precept in constitutional law that the guaranty of the equal protection of the laws is not violated by a legislation based on reasonable classification. is a contention too shallow to deserve merit. while still a bill. In particular.A. which is why it has to privide for a remedy in the form of a transitory provision. Petitioner further contends that the legislature is biased against him as he claims to have been selected from among the 67 million other Filipinos as the object of the deletion of the word "principal" in paragraph a. the party who 34 challenges the law must present proof of arbitrariness. all of which are present in this case. under the transitory provision in Section 7. In their futile attempt to have said sections nullified. considered by 23 other Senators and by about 250 Representatives. it can be reasonably anticipated that an alteration of that jurisdiction would necessarily affect pending cases. by the President of the Philippines. heavy reliance is premised on what is perceived as bad faith on 38 the part of a Senator and two Justices of the Sandiganbaya for their participation in the passage of the said provisions.A 8249. and of the transitory provision of R. The transitory provision does not only cover cases which are in the Sandiganbayan but also in "any court.

It is a substantive law on jurisdiction which is not penal in character. and punishes such action. Not being a penal law. since the title of R. to include subjects related to the general purpose 58 which the statute seeks to achieve. 1606 as regards the Sandiganbayan's jurisdiction. R. its mode of appeal and other procedural matters. 55 On the removal of the intermediate review of facts. but clearly a procedural statute. The challenged law does not violate the one-title-one-subject provision of the Constitution. 8249 expresses the general subject (involving the jurisdiction of the Sandiganbayan and the amendment of P. 8249 has preserved the accused's right to appeal to the Supreme Court to review questions of law. The expantion in the jurisdiction of the Sandiganbayan. This Court added two more to the list. Article VIII of the Constitution itself 60 empowers the legislative body to "define. Another point. 8249. 1606.(a) which makes an act done criminal before the passing of the law and which was innocent when committed. if it can be considered as such. as in this case. acted within its power since Section 2.D. The same contention has already been rejected by the 50 court several times considering that the right to appeal is not a natural right but statutory in nature that can be regulated by law. Petitioner's and entervenors' contention that their right to a two-tiered appeal which they acquired under R.A. the Supreme Court still has the power of review to determine if 56 he presumption of innocence has been convincing overcome. in employing the word "define" in the title of the law. Ex post facto law. the retroactive application of R. does not have to be expressly stated in the title of the law because such is the necessary 57 consequence of the amendments.A 7975. i. does not 52 53 come within the prohibition. the law did not alter the rules of evidence or the mode of trial. and apportion the jurisdiction of various courts. The Congress. as 59 amended) and all the provisions of the law are germane to that general subject. 49 one which prescribes rules of procedure by which courts applying laws of all kinds can properly administer justice. such as the protection of a former conviction or 45 acquittal. namely: (f) that which assumes to regulate civil rights and remedies only but in effect imposes a penalty or deprivation of a right which when done was lawful. which amended P. generally.e. (e) Every law which. or (b) which aggravates a crime or makes it greater than when it was committed.A. treat of their nature. and being merely an amendatory statute it does not partake the nature of an ex post facto law.A.A. or those that define crimes. is incorrect.A. or a proclamation of a amnesty. Moreover. (d) which alters the legal rules of evidence and recieves less or different testimony that the law required at the time of the commission of the 43 offense on order to convict the defendant.D. has been declared by the Court as not a penal law. In any case. R. 8249 cannot be challenged as unconstitutional.A. Such rule is liberally interpreted and should be given a practical rather than a technical construction. Penal laws are those acts of the Legislature which prohibit certain acts 47 and establish penalties for their violations. 7975 has been diluted by the enactment of R. 8249 pertains only to matters of procedure. 46 . The requirement that every bill must only have one subject expressed in the title is satisfied if the title is comprehensive enough. R. It does not mete out a penalty and. There is here sufficient compliance with such requirement. (g) deprives a person accussed of crime of some lawful protection to which he has become entitled. prescribe. therefore. or (c) which changes the punishment and inflicts a greater punishment than the law annexed to the crime when it was committed. Much emphasis is placed on the wording in the title of the law that it "defines" the Sandiganbayan jurisdiction when what it allegedly does is to "expand" its jurisdiction. in relation to the offense or its consequences. 8249 is not penal law. It has been 54 ruled that adjective statutes may be made applicable to actions pending and unresolved at the time of their passage. prohibits retrospectivity of penal laws. alters the situation of a person 44 to his disadvantage. and provide dor their 48 punishment.A. The mode of procedure provided for in the statutory right of appeal is not included in the prohibition 51 against ex post facto laws. R.

Montejo. that the accused be informed of the facts that are imputed to him as "he is presumed to have 70 no indefendent knowledge of the facts that constitute the offense. Karelsen: 69 The object of this written accusations was — First. In short. The remaining question to be resolved then is whether the offense of multiple murder was committed in relation to the office of the accussed PNP officers. v. and not by the evidence 62 presented by the parties at the trial. 8249. place. Section 9." The real nature of the criminal charge is determined not from the caption or preamble of the informations nor from the specification of the provision of law alleged to have been violated. we shall now determine whether under the allegations in the Informations. including those in goverment-owned or controlled corporations. names (plaintiff and defendant) and circumstances. 9 Couse of accusation — The acts or omissions complied of as constituting the offense must be stated in ordinary and concise language without repetition not necessarily in the terms of the statute defining the offense. In People vs. it is the Sandiganbayan or Regional Trial Court which has jurisdictions over the multiple murder case against herein petitioner and entervenors. facts must be stated. In order that the requirement may be satisfied. the multiple murder charge against petitioner and intervenors falls under Section 4 [paragraph b] of R. (Emphasis supplied) It is essential. (Emphasis supplied) As early as 1954 we pronounced that "the factor that characterizes the charge is the actual recital of the facts. Rule 110 of the Revised Rules of Court mandates: Sec. they being conclusions of law.There being no unconstitutional infirmity in both the subject amendatory provision of Section 4 and the retroactive procedural application of the law as provided in Section 7 of R. The noble object or written accusations cannot be overemphasized. but in such from as is sufficient to enable a person of common understanding to know what offense is intended to be charged. The jurisdiction of a court is defined by the Constitution or statute. to inform the court of the facts alleged so that it may decide whether they are sufficient in law to support a conviction if one should be had." 67 64 . Every crime is made up of certain acts and intent these must be set forth in the complaint with reasonable particularly of time. "in relation to their office as may be determined by law. not conclusions of law. but by the actual 68 recital of facts in the complaint or information. and enable the court to pronounce proper judgment. To furnish the accused with such a descretion of the charge against him as will enable him to make his defense and second to avail himself of his conviction or acquittal for protection against a further prosecution for the same cause and third. therefore. we held that an offense is said to have been committed in relation to the office if it (the offense) is "intimately connected" with the office of the offender and perpetrated while he was in the performance of 65 his official functions. This jurisdictional requirement is in accordance with Section 5.A." As to how the offense charged be stated in the informations. As stated earlier. the complaint must contain a specific allegation of every fact and circumstance necessary to constitute the crime charged. Hence the elementary rule that 61 the jurisdiction of a court is determined by the allegations in the complaint or informations. Section 4 requires that the offense charged must be committed by the offender in relation to his office in 63 order for the Sandiganbayan to have jurisdiction over it. Article XIII of the 1973 Constitution which mandated that the Sandiganbayan shall have jurisdiction over criminal cases committed by the public officers and employees." This constitutional mandate was reiterated in the new (1987) Constitution when it declared in Section 4 thereof that the Sandiganbayan shall continue to function and exercise its jurisdiction as now or hereafter may be provided by law. This intimate relation between the offense charged and the discharge of official duties "must be 66 alleged in the informations. This was explained in U. No.A. 8249. The elements of that definition must appear in the complaint or information so as to ascertain which court has jurisdiction over a case.S.

MENESES. one of the eleven (11) amended informations 71 for murder reads: AMENDED INFORMATIONS The undersigned Special Prosecution Officer III. ROLANDO ANDUYAN. ALMARIO A. ERWIN T. LANGCAUON. LIWANAG of the crime of Murder as defined and penalize under Article 248 of the Revised Penal Code committed as follows That on or about May 18. ROLANDO ANDUYAN. PARAGAS. PARAGAS. GLENN DUMLAO. VILLACORTE. GIL L. the . SPO1 WILFREDO C. CESAR O. CARINO. ESQUIVEL. 1995. Metro Manila on or about the early dawn of May 18. SENIOR INSP. DANDAN. CHIEF SUPT. CANSON. HILARIO. ZUBIA JR. MICHAEL RAY AQUINO. AGBALOG. we find the amended informations for murder against herein petitioner and intervenors wanting of specific factual averments to show the intimate relation/connection between the offense charged and the discharge of official function of the offenders. LANGCAUON. SPO2 ROLANDO R. That accused CHIEF SUPT. In the present case. VILLACORTE. conspiring with intent to kill and using firearms with treachery evident premeditation and taking advantage of their superior strenghts did then and there willfully unlawfully and feloniously shoot JOEL AMORA. CHIEF INSP. SPO1 ROBERTO O. JEWEL F. BACOLOD. CHIEF INSP. CESAR O. While the above-quoted information states that the above-named principal accused committed the crime of murder "in relation to thier public office. CEASAR TANNAGAN. SPO3 CICERO S. CUARTERO. ARNADO. MANCAO II. GIL L. RICARDO G. ACOP. CHIEF SUPT. MANCAO III. INSP. no specific allegation of facts that the shooting of the victim by the said principal accused was intimately related to the discharge of their official duties as police officers. SENIOR INSP. CHIEF SUPT. the accused CHIEF INSP. DANDAN. SPO2 NORBERTO LASAGA. SPO4 VICENTE ARNADO. SENIOR INSP. SENIOR INSP. SUPT. there is. ESQUIVEL.. thereby inflicting upon the latter mortal wounds which caused his instantaneous death to the damage and prejudice of the heirs of the said victim. GLENN DUMLAO. BACOLOD. SPO2 VIRGILIO V. PANFILO M. PANFILO M. CHIEF INSP. Likewise. PO2 ALEJANDRO G. LACSON. MICHAEL RAY AQUINO. CHIEF SUPT. SPO4 VICENTE P. SPO3 WILLY NUAS. ALMARIO A. INSP. SPO2 VIRGILIO V. and PO2 ALEJANDRO G. LIWANAG committing the acts in relation to office as officers and members of the Philippine National Police are charged herein as accessories after-the-fact for concealing the crime herein above alleged by among others falsely representing that there where no arrest made during the read conducted by the accused herein at Superville Subdivision. SPO1 ROBERTO O. ACOP. ROMOE M. PO2 LEONARDO GLORIA. Office of the Ombudsman hereby accuses CHIEF INSP. FRANCISCO G. CHIEF INSP. SPO2 ROLANDO R. SPO1 OSMUNDO B. 1995 in Mariano Marcos Avenue. SENIOR INSP. ROMEO M. HILARIO. SPO4 ROBERTO F. ZUBIAM JR.. CEASAR TANNAGAN. SPO1 WILFREDO C.Applying these legal principles and doctrines to the present case. SPO3 CICERO S. JOSELITO T. SPO3 WILLY NUAS. INSP. however. Quezon City Philippines and within the jurisdiction of his Honorable Court. FRANCISCO G. JEWEL F. SENIOR SUPT. RICARDO G. JIMENEZ. and SPO1 OSMUNDO B. CARINO. Paranaque. SUPT. all taking advantage of their public and official positions as officers and members of the Philippine National Police and committing the acts herein alleged in relation to their public office. JOSELITO T. CONTRARY LAW. CUARTERO. ERWIN T. SPO4 ROBERTO F. CHIEF INSP. CHIEF SUPT. LACSON. INSP. CHIEF INSP. JIMENEZ. CANSON. SENIOR SUPT. AGBALOG. MENESES. SENIOR INSP.

. has organized groups of police patrol and civilian commandoes consisting of regular policeman and . we ruled: 72 where the jurisdiction between the Regional Trial Court and the Sandiganbayan was at It is an elementary rule that jurisdiction is determined by the allegations in the complaint or information and not by the result of evidence after trial. the amended information is vague on this. where the amended information alleged Leroy S. . however.amended information does not indicate that the said accused arrested and investigated the victim and then killed the latter while in their custody. . Quezon City. We believe that the mere allegation in the amended information that the offense was committed by the accused public officer in relation to his office is not sufficient." we. falsely representing that there were no arrests made during the raid conducted by the accused herein at Superville Subdivision. arrests and shooting happened in the two places far away from each other is puzzling. Even the allegations concerning the criminal participation of herein petitioner and intevenors as among the accessories after-the-facts. The informations merely allege that . Brown City Mayor of Basilan City. at Tipo-tipo which is under his command ." The sudden mention of the "arrests made during the raid conducted by the accused" surprises the reader. not a factual avernment that would show the close intimacy between the offense charged and the discharge of the accused's official duties. as earlier discussed. is an essential element in determining the jurisdiction of the Sandiganbayan. Again. we held that the offense charged was committed in relation to the office of the accused because it was perpetreated while they were in the performance. the raid and arrests were allegedly conducted "at Superville Subdivision. The stringent requirement that the charge be set forth with such particularly as will reasonably indicate the exact offense which the accused is alleged to have committed in relation to his office was. Magallanes. Metro Manila" but. which. ." How the raid. though improper or irregular of their official functions and would not have been committed had they not held their office. sad to say. It is alleged therein that the said accessories concelead "the crime herein-above alleged by. while there is the allegation in the amended information that the said accessories committed the offense "in relation to office as officers and members of the (PNP). as such. supervision and control where his co-defendants were stationed entertained criminal complaints and conducted the corresponding investigations as well as assumed the authority to arrest and detain person without due process of law and without bringing them to the proper court. as alleged in the immediately preceding paragraph of the amended information. the shooting of the victim by the principal accused occurred in Mariano Marcos Avenue. That phrase is merely a conclusion between of law. . Paranaque. the accused had no personal motive in committing the crime thus. . 15562 and 15563 in the court below do not indicate that the accused arrested and investigated the victims and then killed the latter in the course of the investigation. Unlike in Montejo the informations in Criminal Cases Nos. and acting upon his orders his co-defendants arrested and maltreated Awalin Tebag who denied in consequence thereof. and that in line with this set-up established by said Mayor of Basilan City as such." Worse. 1995. on or about the early dawn of May 18. among others. Paranaque Metro Manila. In People vs. issue. besides. do not see the intimate connection between the offense charged and the accused's official functions. not satisfied. there was an intimate connection between the offense and the office of the accused. special policemen appointed and provided by him with pistols and higher power guns and then established a camp . There is no indication in the amended information that the victim was one of those arrested by the accused during the "raid. In (People vs) Montejo (108 Phil 613 (1960).

the constitutionality of Sections 4 and 7 of R. WHEREFORE. and not the evidence presented by the prosecution at the trial.1âwphi1. Jr. within the exclusive original jurisdiction of the Regional Trial Court. Panganiban. Bellosillo. Pardo. kidnapped and detained the two victims.. The Sandiganbayan is hereby directed to transfer Criminal Cases Nos. in order to qualify the crime as having been committed in relation to public office. What is controlling is the specific factual allegations in the information that would indicate the close intimacy between the discharge of the accused's official duties and the commission of the offense charged. Quisumbing.A. Mendoza. therefore. Consequently. Davide. Puno. Melo. CJ. Purisima. 23047 to 23057 (for multiple murder) to the Regional Trial Court of Quezon City which has exclusive original jurisdiction over the said cases.00 abducted. Vitug.nêt SO ORDERED. In the aforecited case of People vs. 1997 Resolution of the Sandiganbayan is REVERSED. 8249 is hereby sustained.the accused for the purpose of extracting or extortin the sum of P353. Kapunan. Buena and . and failing in their common purpose they shot. Montejo. not the Sandiganbayan. Romero. For the purpose of determining jurisdiction. The Addendum to the March 5. which only signifies that the said phrase is not what determines the jurisdiction of the Sandiganbayan..000. and killed the said victims. the offense charged in the subject criminal cases 73 is plain murder and. for failure to show in the amended informations that the charge of murder was intimately connected with the discharge of official functions of the accused PNP officers. it is noteworthy that the phrase committed in relation to public office "does not appear in the information. it is these allegations that shall control.

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