Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-!"#$ Septe%be& '!( !""
CALTE) *P+,L,PP,NES-( ,NC.( petitione&-appellee(
.s.
ENR,CO PALOMAR( in his capacit/ as T+E POSTMASTER GENERAL( &espon0ent-appellant.
Office of the Solicito& Gene&al fo& &espon0ent an0 appellant.
Ross( Selph an0 Ca&&ascoso fo& petitione& an0 appellee.

CASTRO( 1.2
,n the /ea& !"$ the Calte3 *Philippines- ,nc. *he&einafte& &efe&&e0 to as Calte3- concei.e0 an0 lai0 the
4&oun05o&6 fo& a p&o%otional sche%e calculate0 to 0&u% up pat&ona4e fo& its oil p&o0ucts.
7eno%inate0 8Calte3 +oo0e0 Pu%p Contest8( it calls fo& pa&ticipants the&ein to esti%ate the actual
nu%be& of lite&s a hoo0e0 4as pu%p at each Calte3 station 5ill 0ispense 0u&in4 a specifie0 pe&io0.
E%plo/ees of the Calte3 *Philippines- ,nc.( its 0eale&s an0 its a0.e&tisin4 a4enc/( an0 thei& i%%e0iate
fa%ilies e3cepte0( pa&ticipation is to be open in0isc&i%inatel/ to all 8%oto& .ehicle o5ne&s an09o&
license0 0&i.e&s8. :o& the p&i.ile4e to pa&ticipate( no fee o& consi0e&ation is &e;ui&e0 to be pai0( no
pu&chase of Calte3 p&o0ucts &e;ui&e0 to be %a0e. Ent&/ fo&%s a&e to be %a0e a.ailable upon &e;uest at
each Calte3 station 5he&e a seale0 can 5ill be p&o.i0e0 fo& the 0eposit of acco%plishe0 ent&/ stubs.
A th&ee-sta4e0 5inne& selection s/ste% is en.isione0. At the station le.el( calle0 87eale& Contest8( the
contestant 5hose esti%ate is closest to the actual nu%be& of lite&s 0ispense0 b/ the hoo0e0 pu%p
the&eat is to be a5a&0e0 the fi&st p&i<e= the ne3t closest( the secon0= an0 the ne3t( the thi&0. P&i<es at this
le.el consist of a >-bu&ne& 6e&osene sto.e fo& fi&st= a the&%os bottle an0 a Ra/-O-?ac hunte& lante&n fo&
secon0= an0 an E.e&&ea0/ Ma4net-lite flashli4ht 5ith batte&ies an0 a sc&e50&i.e& set fo& thi&0. The fi&st-
p&i<e 5inne& in each station 5ill then be ;ualifie0 to @oin in the 8Re4ional Contest8 in se.en 0iffe&ent
&e4ions. The 5innin4 stubs of the ;ualifie0 contestants in each &e4ion 5ill be 0eposite0 in a seale0 can
f&o% 5hich the fi&st-p&i<e( secon0-p&i<e an0 thi&0-p&i<e 5inne&s of that &e4ion 5ill be 0&a5n. The
&e4ional fi&st-p&i<e 5inne&s 5ill be entitle0 to %a6e a th&ee-0a/ all-e3penses-pai0 &oun0 t&ip to Manila(
acco%panie0 b/ thei& &especti.e Calte3 0eale&s( in o&0e& to ta6e pa&t in the 8National Contest8. The
&e4ional secon0-p&i<e an0 thi&0-p&i<e 5inne&s 5ill &ecei.e cash p&i<es of P#$$ an0 P>$$( &especti.el/.
At the national le.el( the stubs of the se.en &e4ional fi&st-p&i<e 5inne&s 5ill be place0 insi0e a seale0
can f&o% 5hich the 0&a5in4 fo& the final fi&st-p&i<e( secon0-p&i<e an0 thi&0-p&i<e 5inne&s 5ill be %a0e.
Cash p&i<es in sto&e fo& 5inne&s at this final sta4e a&e2 P>($$$ fo& fi&st= P'($$$ fo& secon0= Pl(#$$ fo&
thi&0= an0 P"#$ as consolation p&i<e fo& each of the &e%ainin4 fou& pa&ticipants.
:o&eseein4 the e3tensi.e use of the %ails not onl/ as a%on4st the %e0ia fo& publici<in4 the contest but
also fo& the t&ans%ission of co%%unications &elati.e the&eto( &ep&esentations 5e&e %a0e b/ Calte3 5ith
the postal autho&ities fo& the contest to be clea&e0 in a0.ance fo& %ailin4( ha.in4 in .ie5 sections
!#A*a-( !B' an0 !B> of the Re.ise0 A0%inist&ati.e Co0e( the pe&tinent p&o.isions of 5hich &ea0 as
follo5s2
SECT,ON !#A. Absolutel/ non-%ailable %atte&. C No %atte& belon4in4 to an/ of the follo5in4
classes( 5hethe& seale0 as fi&st-class %atte& o& not( shall be i%po&te0 into the Philippines th&ou4h the
%ails( o& to be 0eposite0 in o& ca&&ie0 b/ the %ails of the Philippines( o& be 0eli.e&e0 to its a00&essee b/
an/ office& o& e%plo/ee of the Bu&eau of Posts2
D&itten o& p&inte0 %atte& in an/ fo&% a0.e&tisin4( 0esc&ibin4( o& in an/ %anne& pe&tainin4 to( o&
con.e/in4 o& pu&po&tin4 to con.e/ an/ info&%ation conce&nin4 an/ lotte&/( 4ift ente&p&ise( o& si%ila&
sche%e 0epen0in4 in 5hole o& in pa&t upon lot o& chance( o& an/ sche%e( 0e.ice( o& ente&p&ise fo&
obtainin4 an/ %one/ o& p&ope&t/ of an/ 6in0 b/ %eans of false o& f&au0ulent p&etenses( &ep&esentations(
o& p&o%ises.
8SECT,ON !B'. :&au0 o&0e&s.CUpon satisfacto&/ e.i0ence that an/ pe&son o& co%pan/ is en4a4e0 in
con0uctin4 an/ lotte&/( 4ift ente&p&ise( o& sche%e fo& the 0ist&ibution of %one/( o& of an/ &eal o&
pe&sonal p&ope&t/ b/ lot( chance( o& 0&a5in4 of an/ 6in0( o& that an/ pe&son o& co%pan/ is con0uctin4
an/ sche%e( 0e.ice( o& ente&p&ise fo& obtainin4 %one/ o& p&ope&t/ of an/ 6in0 th&ou4h the %ails b/
%eans of false o& f&au0ulent p&etenses( &ep&esentations( o& p&o%ises( the 7i&ecto& of Posts %a/ inst&uct
an/ post%aste& o& othe& office& o& e%plo/ee of the Bu&eau to &etu&n to the pe&son( 0epositin4 the sa%e
in the %ails( 5ith the 5o&0 8f&au0ulent8 plainl/ 5&itten o& sta%pe0 upon the outsi0e co.e& the&eof( an/
%ail %atte& of 5hate.e& class %aile0 b/ o& a00&esse0 to such pe&son o& co%pan/ o& the &ep&esentati.e
o& a4ent of such pe&son o& co%pan/.
SECT,ON !B>. 7ep&i.ation of use of %one/ o&0e& s/ste% an0 tele4&aphic t&ansfe& se&.ice.CThe
7i&ecto& of Posts %a/( upon e.i0ence satisfacto&/ to hi% that an/ pe&son o& co%pan/ is en4a4e0 in
con0uctin4 an/ lotte&/( 4ift ente&p&ise o& sche%e fo& the 0ist&ibution of %one/( o& of an/ &eal o&
pe&sonal p&ope&t/ b/ lot( chance( o& 0&a5in4 of an/ 6in0( o& that an/ pe&son o& co%pan/ is con0uctin4
an/ sche%e( 0e.ice( o& ente&p&ise fo& obtainin4 %one/ o& p&ope&t/ of an/ 6in0 th&ou4h the %ails b/
%eans of false o& f&au0ulent p&etenses( &ep&esentations( o& p&o%ise( fo&bi0 the issue o& pa/%ent b/ an/
post%aste& of an/ postal %one/ o&0e& o& tele4&aphic t&ansfe& to sai0 pe&son o& co%pan/ o& to the a4ent
of an/ such pe&son o& co%pan/( 5hethe& such a4ent is actin4 as an in0i.i0ual o& as a fi&%( ban6(
co&po&ation( o& association of an/ 6in0( an0 %a/ p&o.i0e b/ &e4ulation fo& the &etu&n to the &e%itte&s of
the su%s na%e0 in %one/ o&0e&s o& tele4&aphic t&ansfe&s 0&a5n in fa.o& of such pe&son o& co%pan/ o&
its a4ent.
The o.e&tu&es 5e&e late& fo&%ali<e0 in a lette& to the Post%aste& Gene&al( 0ate0 Octobe& >( !"$( in
5hich the Calte3( th&u counsel( enclose0 a cop/ of the contest &ules an0 en0ea.o&e0 to @ustif/ its
position that the contest 0oes not .iolate the anti-lotte&/ p&o.isions of the Postal La5. Uni%p&esse0( the
then Actin4 Post%aste& Gene&al opine0 that the sche%e falls 5ithin the pu&.ie5 of the p&o.isions
afo&esai0 an0 0ecline0 to 4&ant the &e;ueste0 clea&ance. ,n its counselEs lette& of 7ece%be& F( !"$(
Calte3 sou4ht a &econsi0e&ation of the fo&e4oin4 stan0( st&essin4 that the&e bein4 in.ol.e0 no
consi0e&ation in the pa&t of an/ contestant( the contest 5as not( un0e& cont&ollin4 autho&ities(
con0e%nable as a lotte&/. Rel/in4( ho5e.e&( on an opinion &en0e&e0 b/ the Sec&eta&/ of 1ustice on an
un&elate0 case se.en /ea&s befo&e *Opinion 'F( Se&ies of !#>-( the Post%aste& Gene&al %aintaine0 his
.ie5 that the contest in.ol.es consi0e&ation( o& that( if it 0oes not( it is ne.e&theless a 84ift ente&p&ise8
5hich is e;uall/ banne0 b/ the Postal La5( an0 in his lette& of 7ece%be& $( !"$ not onl/ 0enie0 the
use of the %ails fo& pu&poses of the p&opose0 contest but as 5ell th&eatene0 that if the contest 5as
con0ucte0( 8a f&au0 o&0e& 5ill ha.e to be issue0 a4ainst it *Calte3- an0 all its &ep&esentati.es8.
Calte3 the&eupon in.o6e0 @u0icial inte&.ention b/ filin4 the p&esent petition fo& 0ecla&ato&/ &elief
a4ainst Post%aste& Gene&al En&ico Palo%a&( p&a/in4 8that @u04%ent be &en0e&e0 0ecla&in4 its ECalte3
+oo0e0 Pu%p ContestE not to be .iolati.e of the Postal La5( an0 o&0e&in4 &espon0ent to allo5
petitione& the use of the %ails to b&in4 the contest to the attention of the public8. Afte& issues 5e&e
@oine0 an0 upon the &especti.e %e%o&an0a of the pa&ties( the t&ial cou&t &en0e&e0 @u04%ent as follo5s2
,n .ie5 of the fo&e4oin4 consi0e&ations( the Cou&t hol0s that the p&opose0 ECalte3 +oo0e0 Pu%p
ContestE announce0 to be con0ucte0 b/ the petitione& un0e& the &ules %a&6e0 as Anne3 B of the
petitione& 0oes not .iolate the Postal La5 an0 the &espon0ent has no &i4ht to ba& the public 0ist&ibution
of sai0 &ules b/ the %ails.
The &espon0ent appeale0.
The pa&ties a&e no5 befo&e us( a&&a/e0 a4ainst each othe& upon t5o basic issues2 fi&st( 5hethe& the
petition states a sufficient cause of action fo& 0ecla&ato&/ &elief= an0 secon0( 5hethe& the p&opose0
8Calte3 +oo0e0 Pu%p Contest8 .iolates the Postal La5. De shall ta6e these up in se&iati%.
. B/ e3p&ess %an0ate of section of Rule "" of the ol0 Rules of Cou&t( 5hich 5as the applicable le4al
basis fo& the &e%e0/ at the ti%e it 5as in.o6e0( 0ecla&ato&/ &elief is a.ailable to an/ pe&son 85hose
&i4hts a&e affecte0 b/ a statute . . . to 0ete&%ine an/ ;uestion of const&uction o& .ali0it/ a&isin4 un0e&
the . . . statute an0 fo& a 0ecla&ation of his &i4hts the&eun0e&8 *no5 section ( Rule "A( Re.ise0 Rules of
Cou&t-. ,n a%plification( this Cou&t( confo&%abl/ to establishe0 @u&isp&u0ence on the %atte&( lai0 0o5n
ce&tain con0itions sine ;ua non the&efo&( to 5it2 *- the&e %ust be a @usticiable cont&o.e&s/= *'- the
cont&o.e&s/ %ust be bet5een pe&sons 5hose inte&ests a&e a0.e&se= *>- the pa&t/ see6in4 0ecla&ato&/
&elief %ust ha.e a le4al inte&est in the cont&o.e&s/= an0 *A- the issue in.ol.e0 %ust be &ipe fo& @u0icial
0ete&%ination *Tolentino .s. The Boa&0 of Accountanc/( et al.( G.R. No. L->$"'( Septe%be& 'B( !#=
7elu%en( et al. .s. Republic of the Philippines( #$ O.G.( No. '( pp. #F"( #FB-#F!= E0a0es .s. E0a0es(
et al.( G.R. No. L-B!"A( 1ul/ >( !#"-. The 4&a.a%en of the appellantEs stan0 bein4 that the petition
he&ein states no sufficient cause of action fo& 0ecla&ato&/ &elief( ou& 0ut/ is to assa/ the factual bases
the&eof upon the fo&e4oin4 c&ucible.
As 5e loo6 in &et&ospect at the inci0ents that 4ene&ate0 the p&esent cont&o.e&s/( a nu%be& of si4nificant
points stan0 out in bol0 &elief. The appellee *Calte3-( as a business ente&p&ise of so%e conse;uence(
conce0e0l/ has the un;uestione0 &i4ht to e3ploit e.e&/ le4iti%ate %eans( an0 to a.ail of all app&op&iate
%e0ia to a0.e&tise an0 sti%ulate inc&ease0 pat&ona4e fo& its p&o0ucts. ,n cont&ast( the appellant( as the
autho&it/ cha&4e0 5ith the enfo&ce%ent of the Postal La5( a0%itte0l/ has the po5e& an0 the 0ut/ to
supp&ess t&ans4&essions the&eof C pa&ticula&l/ th&u the issuance of f&au0 o&0e&s( un0e& Sections !B'
an0 !B> of the Re.ise0 A0%inist&ati.e Co0e( a4ainst le4all/ non-%ailable sche%es. Ob.iousl/
pu&suin4 its &i4ht afo&esai0( the appellee lai0 out plans fo& the sales p&o%otion sche%e he&einbefo&e
0etaile0. To fo&estall possible 0ifficulties in the 0isse%ination of info&%ation the&eon th&u the %ails(
a%on4st othe& %e0ia( it 5as foun0 e3pe0ient to &e;uest the appellant fo& an a0.ance clea&ance the&efo&.
+o5e.e&( li6e5ise b/ .i&tue of his @u&is0iction in the p&e%ises an0 const&uin4 the pe&tinent p&o.isions
of the Postal La5( the appellant sa5 a .iolation the&eof in the p&opose0 sche%e an0 acco&0in4l/
0ecline0 the &e;uest. A point of 0iffe&ence as to the co&&ect const&uction to be 4i.en to the applicable
statute 5as thus &eache0. Co%%unications in 5hich the pa&ties e3poun0e0 on thei& &especti.e theo&ies
5e&e e3chan4e0. The confi0ence 5ith 5hich the appellee insiste0 upon its position 5as %atche0 onl/
b/ the obstinac/ 5ith 5hich the appellant stoo0 his 4&oun0. An0 this i%passe 5as cli%a3e0 b/ the
appellantEs open 5a&nin4 to the appellee that if the p&opose0 contest 5as 8con0ucte0( a f&au0 o&0e& 5ill
ha.e to be issue0 a4ainst it an0 all its &ep&esentati.es.8
A4ainst this bac60&op( the sta4e 5as in0ee0 set fo& the &e%e0/ p&a/e0 fo&. The appelleeEs insistent
asse&tion of its clai% to the use of the %ails fo& its p&opose0 contest( an0 the challen4e the&eto an0
conse;uent 0enial b/ the appellant of the p&i.ile4e 0e%an0e0( un0oubte0l/ spa5ne0 a li.e cont&o.e&s/.
The @usticiabilit/ of the 0ispute cannot be 4ainsai0. The&e is an acti.e anta4onistic asse&tion of a le4al
&i4ht on one si0e an0 a 0enial the&eof on the othe&( conce&nin4 a &eal C not a %e&e theo&etical C
;uestion o& issue. The conten0e&s a&e as &eal as thei& inte&ests a&e substantial. To the appellee( the
unce&taint/ occasione0 b/ the 0i.e&4ence of .ie5s on the issue of const&uction ha%pe&s o& 0istu&bs its
f&ee0o% to enhance its business. To the appellant( the supp&ession of the appelleeEs p&opose0 contest
belie.e0 to t&ans4&ess a la5 he has s5o&n to uphol0 an0 enfo&ce is an una.oi0able 0ut/. Dith the
appelleeEs bent to hol0 the contest an0 the appellantEs th&eat to issue a f&au0 o&0e& the&efo& if ca&&ie0 out(
the conten0e&s a&e conf&onte0 b/ the o%inous sha0o5 of an i%%inent an0 ine.itable liti4ation unless
thei& 0iffe&ences a&e settle0 an0 stabili<e0 b/ a t&an;uili<in4 0ecla&ation *Pablo / Sen( et al. .s.
Republic of the Philippines( G.R. No. L-"B"B( Ap&il >$( !##-. An0( cont&a&/ to the insinuation of the
appellant( the ti%e is lon4 past 5hen it can &i4htl/ be sai0 that %e&el/ the appelleeEs 80esi&es a&e
th5a&te0 b/ its o5n 0oubts( o& b/ the fea&s of othe&s8 C 5hich a0%itte0l/ 0oes not confe& a cause of
action. 7oubt( if an/ the&e 5as( has &ipene0 into a @usticiable cont&o.e&s/ 5hen( as in the case at ba&( it
5as t&anslate0 into a positi.e clai% of &i4ht 5hich is actuall/ conteste0 *,,, Mo&an( Co%%ents on the
Rules of Cou&t( !"> e0.( pp. >'->>( citin42 Doo05a&0 .s. :o3 Dest Coast Theate&s( >" A&i<.( '#(
'BA Pac. >#$-.
De cannot hospitabl/ ente&tain the appellantEs p&etense that the&e is he&e no ;uestion of const&uction
because the sai0 appellant 8si%pl/ applie0 the clea& p&o.isions of the la5 to a 4i.en set of facts as
e%bo0ie0 in the &ules of the contest8( hence( the&e is no &oo% fo& 0ecla&ato&/ &elief. The infi&%it/ of
this pose lies in the fact that it p&ocee0s f&o% the assu%ption that( if the ci&cu%stances he&e p&esente0(
the const&uction of the le4al p&o.isions can be 0i.o&ce0 f&o% the %atte& of thei& application to the
appelleeEs contest. This is not feasible. Const&uction( .e&il/( is the a&t o& p&ocess of 0isco.e&in4 an0
e3poun0in4 the %eanin4 an0 intention of the autho&s of the la5 5ith &espect to its application to a
4i.en case( 5he&e that intention is &en0e&e0 0oubtful( a%on4st othe&s( b/ &eason of the fact that the
4i.en case is not e3plicitl/ p&o.i0e0 fo& in the la5 *Blac6( ,nte&p&etation of La5s( p. -. This is
p&ecisel/ the case he&e. Dhethe& o& not the sche%e p&opose0 b/ the appellee is 5ithin the co.e&a4e of
the p&ohibiti.e p&o.isions of the Postal La5 inescapabl/ &e;ui&es an in;ui&/ into the inten0e0 %eanin4
of the 5o&0s use0 the&ein. To ou& %in0( this is as %uch a ;uestion of const&uction o& inte&p&etation as
an/ othe&.
No& is it accu&ate to sa/( as the appellant inti%ates( that a p&onounce%ent on the %atte& at han0 can
a%ount to nothin4 %o&e than an a0.iso&/ opinion the han0in4 0o5n of 5hich is anathe%a to a
0ecla&ato&/ &elief action. Of cou&se( no b&each of the Postal La5 has as /et been co%%itte0. Get( the
0isa4&ee%ent o.e& the const&uction the&eof is no lon4e& nebulous o& contin4ent. ,t has ta6en a fi3e0 an0
final shape( p&esentin4 clea&l/ 0efine0 le4al issues susceptible of i%%e0iate &esolution. Dith the battle
lines 0&a5n( in a %anne& of spea6in4( the p&op&iet/ C na/( the necessit/ C of settin4 the 0ispute at &est
befo&e it accu%ulates the aspe&it/ 0iste%pe&( ani%osit/( passion an0 .iolence of a full-blo5n battle
5hich loo%s ahea0 *,,, Mo&an( Co%%ents on the Rules of Cou&t( !"> e0.( p. >' an0 cases cite0-(
cannot but be conce0e0. Pa&aph&asin4 the lan4ua4e in Heitlin .s. A&nebe&4h #! Cal.( '0.( !$( > Cal.
Rpt&.( B$$( >B> P. '0.( #'( cite0 in '' A%. 1u&.( '0.( p. B"!( to 0en/ 0ecla&ato&/ &elief to the appellee in
the situation into 5hich it has been cast( 5oul0 be to fo&ce it to choose bet5een un0esi&able
alte&nati.es. ,f it cannot obtain a final an0 0efiniti.e p&onounce%ent as to 5hethe& the anti-lotte&/
p&o.isions of the Postal La5 appl/ to its p&opose0 contest( it 5oul0 be face0 5ith these choices2 ,f it
launches the contest an0 uses the %ails fo& pu&poses the&eof( it not onl/ incu&s the &is6( but is also
actuall/ th&eatene0 5ith the ce&tain i%position( of a f&au0 o&0e& 5ith its conco%itant sti4%a 5hich %a/
attach e.en if the appellee 5ill e.entuall/ be .in0icate0= if it aban0ons the contest( it beco%es a self-
appointe0 censo&( o& pe&%its the appellant to put into effect a .i&tual fiat of p&e.ious censo&ship 5hich
is constitutionall/ un5a&&ante0. As 5e 5ei4h these consi0e&ations in one e;uation an0 in the spi&it of
libe&alit/ 5ith 5hich the Rules of Cou&t a&e to be inte&p&ete0 in o&0e& to p&o%ote thei& ob@ect *section (
Rule ( Re.ise0 Rules of Cou&t- C 5hich( in the instant case( is to settle( an0 affo&0 &elief f&o%
unce&taint/ an0 insecu&it/ 5ith &espect to( &i4hts an0 0uties un0e& a la5 C 5e can see in the p&esent
case an/ i%position upon ou& @u&is0iction o& an/ futilit/ o& p&e%atu&it/ in ou& inte&.ention.
The appellant( 5e app&ehen0( un0e&&ates the fo&ce an0 bin0in4 effect of the &ulin4 5e han0 0o5n in this
case if he belie.es that it 5ill not ha.e the final an0 pacif/in4 function that a 0ecla&ato&/ @u04%ent is
calculate0 to subse&.e. At the .e&/ least( the appellant 5ill be boun0. But %o&e than this( he ob.iousl/
o.e&loo6s that in this @u&is0iction( 81u0icial 0ecisions appl/in4 o& inte&p&etin4 the la5 shall fo&% a pa&t
of the le4al s/ste%8 *A&ticle B( Ci.il Co0e of the Philippines-. ,n effect( @u0icial 0ecisions assu%e the
sa%e autho&it/ as the statute itself an0( until autho&itati.el/ aban0one0( necessa&il/ beco%e( to the
e3tent that the/ a&e applicable( the c&ite&ia 5hich %ust cont&ol the actuations not onl/ of those calle0
upon to abi0e the&eb/ but also of those in 0ut/ boun0 to enfo&ce obe0ience the&eto. Acco&0in4l/( 5e
ente&tain no %is4i.in4s that ou& &esolution of this case 5ill te&%inate the cont&o.e&s/ at han0.
,t is not a%iss to point out at this @unctu&e that the conclusion 5e ha.e he&ein @ust &eache0 is not 5ithout
p&ece0ent. ,n Libe&t/ Calen0a& Co. .s. Cohen( ! N.1.( >!!( F A. '0.( ABF( 5he&e a co&po&ation
en4a4e0 in p&o%otional a0.e&tisin4 5as a0.ise0 b/ the count/ p&osecuto& that its p&opose0 sales
p&o%otion plan ha0 the cha&acte&istics of a lotte&/( an0 that if such sales p&o%otion 5e&e con0ucte0( the
co&po&ation 5oul0 be sub@ect to c&i%inal p&osecution( it 5as hel0 that the co&po&ation 5as entitle0 to
%aintain a 0ecla&ato&/ &elief action a4ainst the count/ p&osecuto& to 0ete&%ine the le4alit/ of its sales
p&o%otion plan. ,n pa&i %ate&ia( see also2 Bunis .s. Con5a/( F App. 7i.. '0.( '$F( '>A N.G.S. '0.(
A>#= Heitlin .s. A&nebe&4h( sup&a= Th&illo( ,nc. .s. Scott( # N.1. Supe&. 'A( B' A. '0.( !$>.
,n fine( 5e hol0 that the appellee has %a0e out a case fo& 0ecla&ato&/ &elief.
'. The Postal La5( chapte& #' of the Re.ise0 A0%inist&ati.e Co0e( usin4 al%ost i0entical te&%inolo4/
in sections !#A*a-( !B' an0 !B> the&eof( sup&a( con0e%ns as absolutel/ non-%ailable( an0
e%po5e&s the Post%aste& Gene&al to issue f&au0 o&0e&s a4ainst( o& othe&5ise 0en/ the use of the
facilities of the postal se&.ice to( an/ info&%ation conce&nin4 8an/ lotte&/( 4ift ente&p&ise( o& sche%e fo&
the 0ist&ibution of %one/( o& of an/ &eal o& pe&sonal p&ope&t/ b/ lot( chance( o& 0&a5in4 of an/ 6in08.
Upon these 5o&0s hin4es the &esolution of the secon0 issue pose0 in this appeal.
+appil/( this is not an alto4ethe& unt&o00en @u0icial path. As ea&l/ as in !''( in 8El 7ebate8( ,nc. .s.
Topacio( AA Phil.( 'FB( 'B>-'BA( 5hich si4nificantl/ 05elt on the po5e& of the postal autho&ities un0e&
the abo.e%entione0 p&o.isions of the Postal La5( this Cou&t 0ecla&e0 that C
Dhile countless 0efinitions of lotte&/ ha.e been atte%pte0( the autho&itati.e one fo& this @u&is0iction is
that of the Unite0 States Sup&e%e Cou&t( in analo4ous cases ha.in4 to 0o 5ith the po5e& of the Unite0
States Post%aste& Gene&al( .i<.2 The te&% 8lotte&/8 e3ten0s to all sche%es fo& the 0ist&ibution of p&i<es
b/ chance( such as polic/ pla/in4( 4ift e3hibitions( p&i<e conce&ts( &affles at fai&s( etc.( an0 .a&ious
fo&%s of 4a%blin4. The th&ee essential ele%ents of a lotte&/ a&e2 :i&st( consi0e&ation= secon0( p&i<e= an0
thi&0( chance. *+o&ne& .s. States IB!'J( AF U.S. AA!= Public Clea&in4 +ouse .s. Co/ne I!$>J( !A
U.S.( A!F= U.S. .s. :ila&t an0 Sin4son I!#J( >$ Phil.( B$= U.S. .s. Olsen an0 Ma&6e& I!FJ( >" Phil.(
>!#= U.S. .s. Ba4uio I!!J( >! Phil.( !"'= ?alhalla +otel Const&uction Co%pan/ .s. Ca&%ona( p. '>>(
ante.-
Unani%it/ the&e is in all ;ua&te&s( an0 5e a4&ee( that the ele%ents of p&i<e an0 chance a&e too ob.ious
in the 0ispute0 sche%e to be the sub@ect of contention. Conse;uentl/ as the appellant hi%self conce0es(
the fiel0 of in;ui&/ is na&&o5e0 0o5n to the e3istence of the ele%ent of consi0e&ation the&ein.
Respectin4 this %atte&( ou& tas6 is consi0e&abl/ li4htene0 inas%uch as in the sa%e case @ust cite0( this
Cou&t has lai0 0o5n a 0efiniti.e /a&0-stic6 in the follo5in4 te&%s C
,n &espect to the last ele%ent of consi0e&ation( the la5 0oes not con0e%n the 4&atuitous 0ist&ibution of
p&ope&t/ b/ chance( if no consi0e&ation is 0e&i.e0 0i&ectl/ o& in0i&ectl/ f&o% the pa&t/ &ecei.in4 the
chance( but 0oes con0e%n as c&i%inal sche%es in 5hich a .aluable consi0e&ation of so%e 6in0 is pai0
0i&ectl/ o& in0i&ectl/ fo& the chance to 0&a5 a p&i<e.
Re.e&tin4 to the &ules of the p&opose0 contest( 5e a&e st&uc6 b/ the cla&it/ of the lan4ua4e in 5hich the
in.itation to pa&ticipate the&ein is couche0. Thus C
No pu<<les( no &h/%esK Gou 0onEt nee0 5&appe&s( labels o& bo3topsK Gou 0onEt ha.e to bu/ an/thin4K
Si%pl/ esti%ate the actual nu%be& of lite& the Calte3 4as pu%p 5ith the hoo0 at /ou& fa.o&ite Calte3
0eale& 5ill 0ispense f&o% C to C( an0 5in .aluable p&i<es . . . .8 .
No5he&e in the sai0 &ules is an/ &e;ui&e%ent that an/ fee be pai0( an/ %e&chan0ise be bou4ht( an/
se&.ice be &en0e&e0( o& an/ .alue 5hatsoe.e& be 4i.en fo& the p&i.ile4e to pa&ticipate. A p&ospecti.e
contestant has but to 4o to a Calte3 station( &e;uest fo& the ent&/ fo&% 5hich is a.ailable on 0e%an0(
an0 acco%plish an0 sub%it the sa%e fo& the 0&a5in4 of the 5inne&. ?ie5e0 f&o% all an4les o& tu&ne0
insi0e out( the contest fails to e3hibit an/ 0isce&nible consi0e&ation 5hich 5oul0 b&an0 it as a lotte&/.
,n0ee0( e.en as 5e hea0 the ste&n in@unction( 8loo6 be/on0 the fai& e3te&io&( to the substance( in o&0e&
to un%as6 the &eal ele%ent an0 pe&nicious ten0encies 5hich the la5 is see6in4 to p&e.ent8 *8El
7ebate8( ,nc. .s. Topacio( sup&a( p. '!-( 5e fin0 none. ,n ou& app&aisal( the sche%e 0oes not onl/
appea& to be( but actuall/ is( a 4&atuitous 0ist&ibution of p&ope&t/ b/ chance.
The&e is no point to the appellantEs insistence that non-Calte3 custo%e&s 5ho %a/ bu/ Calte3 p&o0ucts
si%pl/ to 5in a p&i<e 5oul0 actuall/ be in0i&ectl/ pa/in4 a consi0e&ation fo& the p&i.ile4e to @oin the
contest. Pe&haps this 5oul0 be tenable if the pu&chase of an/ Calte3 p&o0uct o& the use of an/ Calte3
se&.ice 5e&e a p&e-&e;uisite to pa&ticipation. But it is not. A contestant( it ha&0l/ nee0s &eite&atin4( 0oes
not ha.e to bu/ an/thin4 o& to 4i.e an/thin4 of .alue.a5phLl.nMt
Off-tan4ent( too( is the su44estion that the sche%e( bein4 a0%itte0l/ fo& sales p&o%otion( 5oul0
natu&all/ benefit the sponso& in the 5a/ of inc&ease0 pat&ona4e b/ those 5ho 5ill be encou&a4e0 to
p&efe& Calte3 p&o0ucts 8if onl/ to 4et the chance to 0&a5 a p&i<e b/ secu&in4 ent&/ blan6s8. The &e;ui&e0
ele%ent of consi0e&ation 0oes not consist of the benefit 0e&i.e0 b/ the p&oponent of the contest. The
t&ue test( as lai0 0o5n in People .s. Ca&0as( 'B P. '0.( !!( >F Cal. App. *Supp.- FBB( is 5hethe& the
pa&ticipant pa/s a .aluable consi0e&ation fo& the chance( an0 not 5hethe& those con0uctin4 the
ente&p&ise &ecei.e so%ethin4 of .alue in &etu&n fo& the 0ist&ibution of the p&i<e. Pe&specti.e p&ope&l/
o&iente0( the stan0point of the contestant is all that %atte&s( not that of the sponso&. The follo5in4(
culle0 f&o% Co&pus 1u&is Secun0u%( shoul0 set the %atte& at &est2
The fact that the hol0e& of the 0&a5in4 e3pects the&eb/ to &ecei.e( o& in fact 0oes &ecei.e( so%e benefit
in the 5a/ of pat&ona4e o& othe&5ise( as a &esult of the 0&a5in4= 0oes not suppl/ the ele%ent of
consi0e&ation. G&iffith A%use%ent Co. .s. Mo&4an( Te3. Ci.. App.( !B S.D.( '0.( BAA8 *#A C.1.S.( p.
BA!-.
Thus enli4htene0( 5e @oin the t&ial cou&t in 0ecla&in4 that the 8Calte3 +oo0e0 Pu%p Contest8 p&opose0
b/ the appellee is not a lotte&/ that %a/ be a0%inist&ati.el/ an0 a0.e&sel/ 0ealt 5ith un0e& the Postal
La5.
But it %a/ be as6e02 ,s it not at least a 84ift ente&p&ise( o& sche%e fo& the 0ist&ibution of %one/( o& of
an/ &eal o& pe&sonal p&ope&t/ b/ lot( chance( o& 0&a5in4 of an/ 6in08( 5hich is e;uall/ p&esc&ibe0K
,nci0entall/( 5hile the appellantEs b&ief appea&s to ha.e concent&ate0 on the issue of consi0e&ation( this
aspect of the case cannot be a.oi0e0 if the &e%e0/ he&e in.o6e0 is to achie.e its t&an;uili<in4 effect as
an inst&u%ent of both cu&ati.e an0 p&e.enti.e @ustice. Recallin4 that the appellantEs action 5as
p&e0icate0( a%on4st othe& bases( upon Opinion 'F( Se&ies !#>( of the Sec&eta&/ of 1ustice( 5hich
opine0 in effect that a sche%e( thou4h not a lotte&/ fo& 5ant of consi0e&ation( %a/ ne.e&theless be a
4ift ente&p&ise in 5hich that ele%ent is not essential( the 0ete&%ination of 5hethe& o& not the p&opose0
contest C 5antin4 in consi0e&ation as 5e ha.e foun0 it to be C is a p&ohibite0 4ift ente&p&ise( cannot
be passe0 o.e& sub silencio.
Dhile an all-e%b&acin4 concept of the te&% 84ift ente&p&ise8 is /et to be spelle0 out in e3plicit 5o&0s(
the&e appea&s to be a consensus a%on4 le3ico4&aphe&s an0 stan0a&0 autho&ities that the te&% is
co%%onl/ applie0 to a spo&tin4 a&tifice of un0e& 5hich 4oo0s a&e sol0 fo& thei& %a&6et .alue but b/
5a/ of in0uce%ent each pu&chase& is 4i.en a chance to 5in a p&i<e *#A C.1.S.( B#$= >A A%. 1u&.( "#A=
Blac6( La5 7ictiona&/( Ath e0.( p. BF= Ballantine( La5 7ictiona&/ 5ith P&onunciations( 'n0 e0.( p. ##=
Retail Section of Cha%be& of Co%%e&ce of Platts%outh .s. Niec6( '#F N.D.( A!>( 'B Neb. >= Ba&6e&
.s. State( !> S.E.( "$#( #" Ga. App.( F$#= Bell .s. State( >F Tenn. #$F( #$!( # Snee0( #$F( #$!-. As
thus concei.e0( the te&% clea&l/ cannot e%b&ace the sche%e at ba&. As al&ea0/ note0( the&e is no sale of
an/thin4 to 5hich the chance offe&e0 is attache0 as an in0uce%ent to the pu&chase&. The contest is open
to all ;ualifie0 contestants i&&especti.e of 5hethe& o& not the/ bu/ the appelleeEs p&o0ucts.
Goin4 a step fa&the&( ho5e.e&( an0 assu%in4 that the appelleeEs contest can be enco%passe0 5ithin the
b&oa0est s5eep that the te&% 84ift ente&p&ise8 is capable of bein4 e3ten0e0( 5e thin6 that the appellantEs
pose 5ill 4ain no a00e0 co%fo&t. As state0 in the opinion &elie0 upon( &ulin4s the&e a&e in0ee0 hol0in4
that a 4ift ente&p&ise in.ol.in4 an a5a&0 b/ chance( e.en in 0efault of the ele%ent of consi0e&ation
necessa&/ to constitute a lotte&/( is p&ohibite0 *E.4.2 C&i%es .s. States( '># Ala !'( FB So. F>= Russell
.s. E;uitable Loan O Sec. Co.( '! Ga. #A( #B S.E.( BB= State e3 &el. Staffo&0 .s. :o3-G&eat :alls
Theate& Co&po&ation( >' P. '0.( "B!( "!A( "!B( A Mont. #'-. But this is onl/ one si0e of the coin.
E;uall/ i%p&essi.e autho&ities 0ecla&e that( li6e a lotte&/( a 4ift ente&p&ise co%es 5ithin the p&ohibiti.e
statutes onl/ if it e3hibits the t&ipa&tite ele%ents of p&i<e( chance an0 consi0e&ation *E.4.2 Bills .s.
People( #F P. '0.( >!( A'( > Colo.( >'"= 7EO&io .s. 1acobs( 'F# P. #">( #"#( # Dash.( '!F=
People .s. Psallis( ' N.G.S.( '0.( F!"= Cit/ an0 Count/ of 7en.e& .s. :&ueauff( BB P.( >B!( >!A( >!
Colo.( '$( F L.R.A.( N.S.( >( ' Ann. Cas.( #'= #A C.1.S.( B#( citin42 Ba&6e& .s. State( !> S.E.(
"$#( "$F( #" Ga. App.( F$#= B Do&0s an0 Ph&ases( pe&%. e0.( pp. #!$-#!A-. The appa&ent conflict of
opinions is e3plaine0 b/ the fact that the specific statuto&/ p&o.isions &elie0 upon a&e not i0entical. ,n
so%e cases( as pointe0 out in #A C.1.S.( B#( the te&%s 8lotte&/8 an0 84ift ente&p&ise8 a&e use0
inte&chan4eabl/ *Bills .s. People( sup&a-= in othe&s( the necessit/ fo& the ele%ent of consi0e&ation o&
chance has been specificall/ eli%inate0 b/ statute. *#A C.1.S.( >#->#'( citin4 Ba&6e& .s. State( sup&a=
State e3 &el. Staffo&0 .s. :o3-G&eat :alls Theate& Co&po&ation( sup&a-. The lesson that 5e 0e&i.e f&o%
this state of the pe&tinent @u&isp&u0ence is( the&efo&e( that e.e&/ case %ust be &esol.e0 upon the
pa&ticula& ph&aseolo4/ of the applicable statuto&/ p&o.ision.
Ta6in4 this cue( 5e note that in the Postal La5( the te&% in ;uestion is use0 in association 5ith the
5o&0 8lotte&/8. Dith the %eanin4 of lotte&/ settle0( an0 consonant to the 5ell-6no5n p&inciple of le4al
he&%eneutics noscitu& a sociis C 5hich Opinion 'F afo&esai0 also &elie0 upon althou4h onl/ insofa&
as the ele%ent of chance is conce&ne0 C it is onl/ lo4ical that the te&% un0e& a const&uction shoul0 be
acco&0e0 no othe& %eanin4 than that 5hich is consistent 5ith the natu&e of the 5o&0 associate0
the&e5ith. +ence( if lotte&/ is p&ohibite0 onl/ if it in.ol.es a consi0e&ation( so also %ust the te&% 84ift
ente&p&ise8 be so const&ue0. Si4nificantl/( the&e is not in the la5 the sli4htest in0iciu% of an/ intent to
eli%inate that ele%ent of consi0e&ation f&o% the 84ift ente&p&ise8 the&ein inclu0e0.
This conclusion fi&%s up in the li4ht of the %ischief sou4ht to be &e%e0ie0 b/ the la5( &eso&t to the
0ete&%ination the&eof bein4 an accepte0 e3t&insic ai0 in statuto&/ const&uction. Mail f&au0 o&0e&s( it is
a3io%atic( a&e 0esi4ne0 to p&e.ent the use of the %ails as a %e0iu% fo& 0isse%inatin4 p&inte0 %atte&s
5hich on 4&oun0s of public polic/ a&e 0ecla&e0 non-%ailable. As applie0 to lotte&ies( 4ift ente&p&ises
an0 si%ila& sche%es( @ustification lies in the &eco4ni<e0 necessit/ to supp&ess thei& ten0enc/ to infla%e
the 4a%blin4 spi&it an0 to co&&upt public %o&als *Co%. .s. Lun0( # A. '0.( B>!( A> Pa. Supe&. '$B-.
Since in 4a%blin4 it is inhe&ent that so%ethin4 of .alue be ha<a&0e0 fo& a chance to 4ain a la&4e&
a%ount( it follo5s ineluctabl/ that 5he&e no consi0e&ation is pai0 b/ the contestant to pa&ticipate( the
&eason behin0 the la5 can ha&0l/ be sai0 to obtain. ,f( as it has been hel0 C
G&atuitous 0ist&ibution of p&ope&t/ b/ lot o& chance 0oes not constitute 8lotte&/8( if it is not &eso&te0 to
as a 0e.ice to e.a0e the la5 an0 no consi0e&ation is 0e&i.e0( 0i&ectl/ o& in0i&ectl/( f&o% the pa&t/
&ecei.in4 the chance( 4a%blin4 spi&it not bein4 culti.ate0 o& sti%ulate0 the&eb/. Cit/ of Ros5ell .s.
1ones( "F P. '0.( 'B"( A N.M.( '#B.8 *'# Do&0s an0 Ph&ases( pe&%. e0.( p. "!#( e%phasis supplie0-.
5e fin0 no obstacle in sa/in4 the sa%e &espectin4 a 4ift ente&p&ise. ,n the en0( 5e a&e pe&sua0e0 to hol0
that( un0e& the p&ohibiti.e p&o.isions of the Postal La5 5hich 5e ha.e he&etofo&e e3a%ine0( 4ift
ente&p&ises an0 si%ila& sche%es the&ein conte%plate0 a&e con0e%nable onl/ if( li6e lotte&ies( the/
in.ol.e the ele%ent of consi0e&ation. :in0in4 none in the contest he&e in ;uestion( 5e &ule that the
appellee %a/ not be 0enie0 the use of the %ails fo& pu&poses the&eof.
Recapitulatin4( 5e hol0 that the petition he&ein states a sufficient cause of action fo& 0ecla&ato&/ &elief(
an0 that the 8Calte3 +oo0e0 Pu%p Contest8 as 0esc&ibe0 in the &ules sub%itte0 b/ the appellee 0oes
not t&ans4&ess the p&o.isions of the Postal La5.
ACCOR7,NGLG( the @u04%ent appeale0 f&o% is affi&%e0. No costs.
Concepcion( C.1.( Re/es( 1.B.L.( Ba&&e&a( 7i<on( Re4ala( Ma6alintal( Ben4<on( 1.P.( Hal0i.a& an0
Sanche<( 11.( concu&.