G.R. No.

180636 March 13, 2013

LORENZO T. TANGGA-AN,* Petitioner,

vs.
PIDLIPPINE TRANSMARINE CARRIERS, INC., UNIVERSE TANKSHIP DELAWARE LLC, and CARLOS C.
SALINAS, Respondents.

DECISION

DEL CASTILLO, J.:

This Court's labor pronouncements must be read and applied with utmost care and caution, taking to mind that in
the very heart of the judicial system, labor cases occupy a special place. More than the State guarantees of
protection of labor and security of tenure, labor disputes involve the fundamental survival of the employees and their
families, who depend -upon the former for all the basic necessities in life.

This Petition for Review on Certiorari1 seeks a modification of the November 30, 2006 Decision2 of the Court of
Appeals (CA) in CA-G.R. SP No. 00806. Also assailed is the November 15, 2007 Resolution3 denying petitioner's
Motion for Reconsideration.

Factual Antecedents

The facts, as found by the CA, are as follows:

This is a case for illegal dismissal with a claim for the payment of salaries corresponding to the unexpired term of
the contract, damages and attorney’s fees filed by private respondent Lorenzo T. Tangga-an against the petitioners
Philippine Transmarine Carriers, Inc., Universe Tankship Delaware LLC, and Carlos C. Salinas4 or herein
respondents.

In his position paper, Tangga-an alleged that on January 31, 2002, he entered into an overseas employment
contract with Philippine Transmarine Carriers, Inc. (PTC) for and in behalf of its foreign employer, Universe
Tankship Delaware, LLC. Under the employment contract, he was to be employed for a period of six months as
chief engineer of the vessel the S.S. "Kure". He was to be paid a basic salary of US$5,000.00; vacation leave pay
equivalent to 15 days a months [sic] or US$2,500.00 per month and tonnage bonus in the amount of US$700.00 a
month.

On February 11, 2002, Tangga-an was deployed. While performing his assigned task, he noticed that while they
were loading liquid cargo at Cedros, Mexico, the vessel suddenly listed too much at the bow. At that particular time
both the master and the chief mate went on shore leave together, which under maritime standard was prohibited. To
avoid any conflict, he chose to ignore the unbecoming conduct of the senior officers of the vessel.

On or about March 13, 2002, the vessel berthed at a port in Japan to discharge its cargo. Thereafter, it sailed to the
U.S.A. While the vessel was still at sea, the master required Tangga-an and the rest of the Filipino Engineer Officers
to report to his office where they were informed that they would be repatriated on account of the delay in the cargo
discharging in Japan, which was principally a duty belonging to the deck officers. He imputed the delay to the non-
readiness of the turbo generator and the inoperation of the boom, since the turbo generator had been prepared and
synchronized for 3.5 hours or even before the vessel arrived in Japan. Moreover, upon checking the boom, they
found the same [sic] operational. Upon verification, they found out that when the vessel berthed in Japan, the cargo
hold was not immediately opened and the deck officers concerned did not prepare the stock. Moreover, while cargo
discharging was ongoing, both the master and the chief mate again went on shore leave together at 4:00 in the
afternoon and returned to the vessel only after midnight. To save face, they harped on the Engine Department for
their mistake. Tangga-an and the other Engineering Officers were ordered to disembark from the vessel on April 2,
2002 and thereafter repatriated. Thence, the complaint.

Philippine Transmarine Carriers, Inc., Universe Tankship Delaware LLC, and Carlos C. Salinas on the other hand,
contended that sometime on [sic] March 2002, during a test of the cargo discharging conveyor system, Tangga-an
and his assistant engineers failed to start the generator that supplied power to the conveyor. They spent 3 hours
trying to start the generator but failed. It was only the third assistant engineer who previously served in the same
vessel who was able to turn on the generator. When the master tried to call the engine room to find out the problem,
Tangga-an did not answer and merely hang [sic] up. The master proceeded to the engine room to find out the
problem by [sic] Tangga-an and his assistant engineers were running around trying to appear busy.

At another time, during a cargo discharging operation requiring the use of a generator system and the conveyor
boom, Tangga-an was nowhere to be found. Apparently, he went on shore leave resulting in a delay of 2 hours
because the machine could not be operated well. Both incidents were recorded in the official logbook. Due to the
delay, protests were filed by the charter [sic].

The master required Tangga-an to submit a written explanation to which he did but blamed the captain and the chief
officer. He failed to explain why he did not personally supervise the operation of the generator system and the
conveyor boom during the cargo discharging operations. His explanation not having been found satisfactory,
respondents decided to terminate Tangga-an’s services. Thus, a notice of dismissal was issued against Tangga-an.
He arrived in the Philippines on April 4, 2002.5

Tangga-an filed a Complaint6 for illegal dismissal with prayer for payment of salaries for the unexpired portion of his
contract, leave pay, exemplary and moral damages, attorney’s fees and interest.

On January 27, 2004, Labor Arbiter Jose G. Gutierrez rendered a Decision7 finding petitioner to have been illegally
dismissed. The Labor Arbiter noted that in petitioner’s letter to respondent Universe Tankship Delaware, LLC dated
April 1, 20028 he categorically denied any negligence on his part relative to the delay in the discharge of the cargo
while the vessel was berthed in Japan. In view thereof, the Labor Arbiter opined that an investigation should have
been conducted in order to ferret out the truth instead of dismissing petitioner outright. Consequently, petitioner’s
dismissal was illegal for lack of just cause and for failure to comply with the twin requirements of notice and
hearing.9

As regards petitioner’s claim for back salaries, the Labor Arbiter found petitioner entitled not to four months which is
equivalent to the unexpired portion of his contract, but only to three months, inclusive of vacation leave pay and
tonnage bonus (or US$8,200 x 3 months = US$24,600) pursuant to Section 10 of Republic Act (RA) No. 8042 or
The Migrant Workers and Overseas Filipinos Act of 2005.

Regarding petitioner’s claim for damages, the same was denied for failure to prove bad faith on the part of the
respondents. However, attorney’s fees equivalent to 10% of the total back salaries was awarded because petitioner
was constrained to litigate.

The dispositive portion of the Labor Arbiter’s Decision, reads:

WHEREFORE, the foregoing premises considered, judgment is hereby rendered finding Tangga-an illegally
dismissed from his employment and directing the respondent Phil. Transmarine Carriers, Inc. to pay Tangga-an the
amount of US$24,600.00 PLUS US$2,460.00 attorney’s fees or a total aggregate amount of US Dollars: TWENTY
SEVEN THOUSAND SIXTY (US$27,060.00) or its peso equivalent at the exchange rate prevailing at the time of
payment.

SO ORDERED.10

Ruling of the National Labor Relations Commission

Respondents appealed to the National Labor Relations Commission (NLRC). They claimed that the Labor Arbiter
committed grave abuse of discretion in finding that petitioner was illegally dismissed; in awarding unearned vacation
leave pay and tonnage bonus when the law and jurisprudence limit recovery to the employee’s basic salary; and in
awarding attorney’s fees despite the absence of proof of bad faith on their part.

On August 25, 2004, the NLRC issued its Decision,11 the dispositive portion of which reads:

WHEREFORE, the Decision dated January 27, 2004 of the Labor Arbiter is AFFIRMED.

Respondents-appellants’ Memorandum of Appeal, dated 23 March 2004 is DISMISSED for lack of merit.

SO ORDERED.12

The NLRC affirmed the finding of illegal dismissal. It held that no notice of hearing was served upon petitioner, and
no hearing whatsoever was conducted on the charges against him. It ruled that respondents could not dispense with
the twin requirements of notice and hearing, which are essential elements of procedural due process. For this
reason, no valid cause for termination has been shown. The NLRC likewise found respondents guilty of bad faith in
illegally dismissing petitioner’s services.

On the issue covering the award of unearned vacation leave pay and tonnage bonus, the NLRC struck down
respondents’ arguments and held that in illegal dismissal cases, the employee is entitled to all the salaries,
allowances and other benefits or their monetary equivalents from the time his compensation is withheld from him
until he is actually reinstated, in effect citing Article 27913 of the Labor Code. It held that vacation leave pay and
tonnage bonus are provided in petitioner’s employment contract, which thus entitles the latter to the same in the
event of illegal dismissal.

Finally, on the issue of attorney’s fees, the NLRC held that since respondents were found to be in bad faith for the
illegal dismissal and petitioner was constrained to litigate with counsel, the award of attorney’s fees is proper.

Respondents moved for reconsideration which was denied by the NLRC in its March 18, 2005 Resolution.14

Ruling of the Court of Appeals

Respondents went up to the CA by Petition for Certiorari,15 seeking to annul the Decision of the NLRC, raising
essentially the same issues taken up in the NLRC.

On November 30, 2006, the CA rendered the assailed Decision, the dispositive portion of which reads, as follows:

WHEREFORE, premises considered, the instant petition is PARTIALLY GRANTED. The Decision of public
respondent is MODIFIED in the following manner:

a. Tangga-an is entitled to three (3) months salary representing the unexpired portion of his contract in the
total amount of US$15,000.00 or its peso equivalent at the exchange rate prevailing at the time of payment;

b. Tangga-an’s placement fee should be reimbursed with 12% interest per annum;

c. The award of attorney’s fees is deleted.

SO ORDERED.16

The CA adhered to the finding of illegal dismissal. But on the subject of monetary awards, the CA considered only
petitioner’s monthly US$5,000.00 basic salary and disregarded his monthly US$2,500.00 vacation leave pay and
US$700.00 tonnage bonus. It likewise held that petitioner’s "unexpired portion of contract" for which he is entitled to
back salaries should only be three months pursuant to Section 1017 of RA 8042. In addition, petitioner should be
paid back his placement fee with interest at the rate of twelve per cent (12%) per annum.

As to attorney’s fees, the CA did not agree with the NLRC’s finding that bad faith on the part of respondents was
present to justify the award of attorney’s fees. It held that there is nothing from the facts and proceedings to suggest
that respondents acted with dishonesty, moral obliquity or conscious doing of wrong in terminating petitioner’s
services.

Petitioner filed a Motion for (Partial) Reconsideration,18 which was denied in the assailed November 15, 2007
Resolution. Thus, he filed the instant Petition.

Issues

In this Petition, Tangga-an seeks a modification of the CA Decision and the reinstatement of the monetary awards
as decreed in the Labor Arbiter’s January 27, 2004 Decision, or in the alternative, the grant of back salaries
equivalent to four months which corresponds to the unexpired portion of the contract, inclusive of vacation leave pay
and tonnage bonus, plus 10% thereof as attorney’s fees.19

Petitioner submits the following issues for resolution:

I. Whether x x x the CA’s issuance of the writ of certiorari reversing the NLRC decision is in accordance with
law;

II. Whether x x x the indemnity provided in Section 10, R. A. 8042 x x x be limited only to the seafarer’s basic
monthly salary or x x x include, based on civil law concept of damages as well as Labor Code concept of
backwages, allowances/benefits or their monetary equivalent as a further relief to restore the seafarer’s
income that was lost by reason of his unlawful dismissal;

III. Whether x x x the indemnity awarded by the CA in petitioner’s favor consisting only of 3 months’ basic
salaries conform with the proper interpretation of Section 10 R. A. 8042 and with the ruling in Skippers
Pacific, Inc. v. Mira, et al., G.R. No. 144314, November 21, 2002 and related cases or is petitioner entitled to
at least 4 months salaries being the unexpired portion of his contract; and

IV. Whether x x x the CA’s disallowance of the award of attorney’s fees, based on the alleged absence of
bad faith on the part of respondent, is in accordance with law or is the attorney’s fees awarded by the NLRC
to petitioner, who was forced to litigate to enforce his rights, justified x x x.20

Petitioner’s Arguments

Petitioner essentially contends that respondents’ resort to an original Petition for Certiorari in the CA is erroneous
because the issues they raised did not involve questions of jurisdiction but of fact and law. He adds that the CA
Decision went against the factual findings of the labor tribunals which ought to be binding, given their expertise in
matters falling within their jurisdiction.

Petitioner likewise contends that the CA erred in excluding his vacation leave pay and tonnage bonus in the
computation of his back salaries as they form part of his salaries and benefits under his employment contract with
the respondents, a covenant which is deemed to be the law governing their relations. He adds that under Article 279
of the Labor Code, he is entitled to full backwages inclusive of allowances and other benefits or their monetary
equivalent from the time his compensation was withheld up to the time he is actually reinstated.

Petitioner accuses the CA of misapplying the doctrine laid down in Skippers Pacific, Inc. v. Skippers Maritime
Services, Ltd.21 He points out that the CA wrongly interpreted and applied what the Court said in the case, and that
the pronouncement therein should have benefited him rather than the respondents.

Petitioner would have the Court reinstate the award of attorney’s fees, on the argument that the presence of bad
faith is not necessary to justify such award. He maintains that the grant of attorney’s fees in labor cases constitutes
an exception to the general requirement that bad faith or malice on the part of the adverse party must first be
proved.

Finally, petitioner prays that this Court reinstate the Labor Arbiter’s monetary awards in his January 27, 2004
Decision or, in the alternative, to grant him full back salaries equivalent to the unexpired portion of his contract, or
four months, plus 10% thereof as attorney’s fees.

Respondents’ Arguments

In seeking affirmance of the assailed CA issuances, respondents basically submit that the CA committed no
reversible error in excluding petitioner’s claims for vacation leave pay, tonnage bonus, and attorney’s fees. They
support and agree with the CA’s reliance upon Skippers Pacific, Inc. v. Skippers Maritime Services, Ltd.,22 and
emphasize that in the absence of bad faith on their part, petitioner may not recover attorney’s fees.

Our Ruling

The Court grants the Petition.

There remains no issue regarding illegal dismissal. In spite of the consistent finding below that petitioner was
illegally dismissed, respondents did not take issue, which thus renders all pronouncements on the matter final.

In resolving petitioner’s monetary claims, the CA utterly misinterpreted the Court’s ruling in Skippers Pacific, Inc. v.
Skippers Maritime Services, Ltd.,23 using it to support a view which the latter case precisely ventured to strike down.
In that case, the employee was hired as the vessel’s Master on a six-months employment contract, but was able to
work for only two months, as he was later on illegally dismissed. The Labor Arbiter, NLRC, and the CA all took the
view that the complaining employee was entitled to his salary for the unexpired portion of his contract, but limited to
only three months pursuant to Section 1024 of RA 8042. The Court did not agree and hence modified the judgment in
said case. It held that, following the wording of Section 10 and its ruling in Marsaman Manning Agency, Inc. v.
National Labor Relations Commission,25 when the illegally dismissed employee’s employment contract has a term of
less than one year, he/she shall be entitled to recovery of salaries representing the unexpired portion of his/her
employment contract. Indeed, there was nothing even vaguely confusing in the Court’s citation therein of Marsaman:

In Marsaman Manning Agency, Inc. vs. NLRC, involving Section 10 of Republic Act No. 8042, we held:

We cannot subscribe to the view that private respondent is entitled to three (3) months salary only. A plain reading
1âw phi1

of Sec. 10 clearly reveals that the choice of which amount to award an illegally dismissed overseas contract worker,
i.e., whether his salaries for the unexpired portion of his employment contract or three (3) months salary for every
year of the unexpired term, whichever is less, comes into play only when the employment contract concerned has a
term of at least one (1) year or more. This is evident from the wording "for every year of the unexpired term" which
follows the wording "salaries x x x for three months." To follow petitioners’ thinking that private respondent is entitled
to three (3) months salary only simply because it is the lesser amount is to completely disregard and overlook some
words used in the statute while giving effect to some. This is contrary to the well-established rule in legal
hermeneutics that in interpreting a statute, care should be taken that every part or word thereof be given effect since
the lawmaking body is presumed to know the meaning of the words employed in the statute and to have used them
advisedly. Ut res magis valeat quam pereat.

It is not disputed that private respondent’s employment contract in the instant case was for six (6) months. Hence,
we see no reason to disregard the ruling in Marsaman that private respondent should be paid his salaries for the
unexpired portion of his employment contract.26 (Emphases supplied)

At this juncture, the courts, especially the CA, should be reminded to read and apply this Court’s labor
pronouncements with utmost care and caution, taking to mind that in the very heart of the judicial system, labor
cases occupy a special place. More than the State guarantees of protection of labor and security of tenure, labor
disputes involve the fundamental survival of the employees and their families, who depend upon the former for all
the basic necessities in life.

Thus, petitioner must be awarded his salaries corresponding to the unexpired portion of his six-months employment
contract, or equivalent to four months. This includes all his corresponding monthly vacation leave pay and tonnage
bonuses which are expressly provided and guaranteed in his employment contract as part of his monthly salary and
benefit package. These benefits were guaranteed to be paid on a monthly basis, and were not made contingent. In
fact, their monetary equivalent was fixed under the contract: US$2,500.00 for vacation leave pay and US$700.00 for
tonnage bonus each month. Thus, petitioner is entitled to back salaries of US$32,800 (or US$5,000 + US$2,500 +
US$700 = US$8,200 x 4 months). "Article 279 of the Labor Code mandates that an employee’s full backwages shall
be inclusive of allowances and other benefits or their monetary equivalent."27 As we have time and again held, "it is
the obligation of the employer to pay an illegally dismissed employee or worker the whole amount of the salaries or
wages, plus all other benefits and bonuses and general increases, to which he would have been normally entitled
had he not been dismissed and had not stopped working."28 This well-defined principle has likewise been lost on the
CA in the consideration of the case.

The CA likewise erred in deleting the award of attorney’s fees on the ground that bad faith may not readily be
attributed to the respondents given the circumstances. The Court’s discussion on the award of attorney’s fees in
Kaisahan at Kapatiran ng mga Manggagawa at Kawani sa MWC-East Zone Union v. Manila Water Company,
Inc.,29speaking through Justice Brion, is instructive, viz:

Article 111 of the Labor Code, as amended, governs the grant of attorney’s fees in labor cases:

‘Art. 111. Attorney’s fees. – (a) In cases of unlawful withholding of wages, the culpable party may be assessed
attorney’s fees equivalent to ten percent of the amount of wages recovered.

(b) It shall be unlawful for any person to demand or accept, in any judicial or administrative proceedings for the
recovery of wages, attorney’s fees which exceed ten percent of the amount of wages recovered.’

Section 8, Rule VIII, Book III of its Implementing Rules also provides, viz.:

‘Section 8. Attorney’s fees. – Attorney’s fees in any judicial or administrative proceedings for the recovery of wages
shall not exceed 10% of the amount awarded. The fees may be deducted from the total amount due the winning
party.’

We explained in PCL Shipping Philippines, Inc. v. National Labor Relations Commission that there are two
commonly accepted concepts of attorney’s fees – the ordinary and extraordinary. In its ordinary concept, an
attorney’s fee is the reasonable compensation paid to a lawyer by his client for the legal services the former renders;
compensation is paid for the cost and/or results of legal services per agreement or as may be assessed. In its
extraordinary concept, attorney’s fees are deemed indemnity for damages ordered by the court to be paid by the
losing party to the winning party. The instances when these may be awarded are enumerated in Article 2208 of the
Civil Code, specifically in its paragraph 7 on actions for recovery of wages, and is payable not to the lawyer but to
the client, unless the client and his lawyer have agreed that the award shall accrue to the lawyer as additional or
part of compensation.

We also held in PCL Shipping that Article 111 of the Labor Code, as amended, contemplates the extraordinary
concept of attorney’s fees and that Article 111 is an exception to the declared policy of strict construction in the
award of attorney’s fees. Although an express finding of facts and law is still necessary to prove the merit of the
award, there need not be any showing that the employer acted maliciously or in bad faith when it withheld the
wages. x x x

We similarly so ruled in RTG Construction, Inc. v. Facto and in Ortiz v. San Miguel Corporation. In RTG
Construction, we specifically stated:

'Settled is the rule that in actions for recovery of wages, or where an employee was forced to litigate and, thus, incur
expenses to protect his rights and interests, a monetary award by way of attorney's fees is justifiable under Article Ill
of the Labor Code; Section 8, Rule VIII, Book III of its Implementing Rules; and paragraph 7, Article 208 of the Civil
Code. The award of attorney's fees is proper, and there need not be any showing that the employer acted
maliciously or in bad faith when it withheld the wages. There need only be a showing that the lawful wages were not
paid accordingly.'

In PCL Shipping, we found the award of attorney's fees due and appropriate since the respondent therein incurred
legal expenses after he was forced to file an action for recovery of his lawful wages and other benefits to protect his
rights. From this perspective and the above precedents, we conclude that the CA erred in ruling that a finding of the
employer's malice or bad faith in withholding wages must precede an award of attorney's fees under Article Ill of the
Labor Code. To reiterate, a plain showing that the lawful wages were not paid without justification is sufficient.30

In this case, it is already settled that petitioner's employment was illegally terminated. As a result, his wages as well
as allowances were withheld without valid and legal basis. Otherwise stated, he was not paid his lawful wages
without any valid justification. Consequently, he was impelled to litigate to protect his interests. Thus, pursuant to the
above ruling, he is entitled to receive attorney’s fees. An award of attorney's fees in petitioner’s favor is in order in
the amount of US$3, 280 (or US$32, 800 x 10%).

WHEREFORE, the Petition is GRANTED. Petitioner Lorenzo T. Tangga-an is hereby declared ENTITLED to back
salaries for the unexpired portion of his contract, inclusive of vacation leave pay and tonnage bonus which is
equivalent to US$32,800 plus US$3,280 as attorney's fees or a total of US$36,080 or its peso equivalent at the
exchange rate prevailing at the time of payment.

SO ORDERED.

MARIANO C. DEL CASTILLO

Associate Justice

G.R. No. L-59154 April 3, 1990

MERIDIAN ASSURANCE CORPORATION, petitioner,

vs.
HON. ABELARDO M. DAYRIT, Judge, CFI, Manila, Br. II, and FIRST WESTERN BANK & TRUST
COMPANY, respondents.

Bito, Lozada, Ortega & Castillo for private respondent.

NARVASA, J.:

The sole issue in this special civil action of certiorari concerns the rate of interest properly imposable in relation to a
judgment for the payment of money: 6%, as provided by Article 2209 of the Civil Code, or 12%, conformably with
Central Bank Circular been passed upon and resolved No. 416. The issue has already by this Court in two (2)
earlier cases, 1 and it is in accordance with those precedents that the case at bar will also be determined.

The petitioner, Meridian Assurance Corporation, was a defendant in Civil Case No. 62317 of the then Court of First
Instance of Manila, entitled "First Western Bank and Trust Company vs. Atlas Timber Company, et al." The case
resulted in a verdict adverse to the defendants, 2 disposing as follows:

WHEREFORE, judgment is rendered in favor of the plaintiff and against the defendants, jointly and
severally, for the Sum of $21,933.38 or its equivalent in pesos at the rate of P3.9390 to a dollar, with interest
at the legal rate from the filing of the complaint, and the costs of the suit, provided, however, that this
judgment should not be enforced against the individual partners before the properties of the partnership
have been exhausted.

The Trial Court's judgment was affirmed in toto by the Court of Appeals on October 9, 1980; 3 and the latter's
judgment having in due course become final and executory, the case was reminded to the Court a quo for
execution. Execution was eventually ordered by the Trial Court by Order dated September 8, 1981.

On September 16, 1981, Meridian Assurance Corporation (hereafter, simply Meridian) wrote to the judgment
creditor, First Western Bank & Trust Co. (hereafter, simply First Western), offering to pay the amount of the
judgment with 6% interest per annum and the approved costs of P237.00. The offer was rejected by First Western,
in its letter of September 21, 1981, its view being that the rate of interest should be 12% per annum, in accordance
with Central Bank Circular No. 416 dated July 29, 1974. Another exchange of letters ensued in which the parties
stood firm on the views set out in their first communications.

Meridian then filed with the Trial Court a motion dated September 30, 1981, manifesting its deposit with the Court of
the amount of P170,061.03 — representing the total of.(1) P86,395.58 (the peso equivalent at the tune of the
principal indebtedness of $21,933.38), (2) P83,428.45 (the interest on the principal debt at 6% p.a from August 27,
1965 to September 30, 1981) and (3) costs in the sum of P237.00 — and praying that the deposit be allowed, that it
be considered full satisfaction of the judgment, and that enforcement of the writ of execution be restrained. The
motion was denied by Order dated October 15, 1981, 4 the Trial. Court opining that Central Bank Circular No. 416
had changed "the legal rate of interest from 6% to 12% per annum." This ruling the trial Court refused to reconsider,
overruling Meridians motion of October 26, 1981 asking it to do so. Meridian thereupon proceeded to this Court
praying for a writ of certiorari to annul the orders denying its aforementioned motion to deposit, etc. dated
September 1981, and to authorize it "to satisfy the amount of the judgment with 6% interest per annum and the
approved costs of P237.00 totalling P170,061.03 . ."

The writ will issue as prayed for. As pointed out in this opinion's opening paragraph, the matter in question has
already been settled in Reformina v. Tomol, Jr. and Philippine Rabbit Bus Lines, Inc. v. Cruz, supra. 5

The question posed in Reformina was whether or not Circular No. 416 of the Central Bank of the Philippines 6 —
amending Section 1 of the Usury Law (Act No. 2655) by prescribing twelve percent (12%) per annum as the "rate of
interest for the loan, or forbearance of any money, goods, or credits and the rate allowed in judgments, in the
absence of express contract as to such rate of interest" . . — applied to "all kinds of monetary judgment." Reformina held that the
"judgments spoken of and referred to are (only) judgments in litigations involving loans or forbearance of any money, goods or credits." It declared 7 that —

. . Any other kind of monetary judgment which has nothing to do with, nor involving loans or forbearance of
any money, goods of credits does not fall within the coverage of the said law (P.D. No. 116) for it is not
within the ambit of the authority granted to the Central Bank. The Monetary Board may not tread on
forbidden grounds. It cannot rewrite other laws. That function is vested solely with the legislative authority. It
is axiomatic in legal hermeneutics that statutes should be construed as a whole and not as series of
disconnected articles and phrases. In the absence of a clear contrary intention, words and phrases in
statutes should not be interpreted in isolation from one another. A word or phrase in a statute is always used
in association with other words or phrases and its meaning may thus be modified of restricted by the latter.

And, as in Philippine Rabbit Bus Lines, Inc. v. Cruz, supra, there is "no reason to depart or deviate from that ruling
here. It seems quite clear that Section 1-a of Act No. 2655, as amended 8 — which, as distinguished from sec. 1 of
the same will appears to be the actual and operative grant of authority to the Monetary Board of the Central Bank to
prescribe maximum rates of interest where the parties have not stipulated thereon — in excluding mention of rates
allowed in judgments, should, at the least, be construed as limiting the authority thus granted only to loans or
forbearances of money, etc., and to judgments involving such loans or forbearances.

WHEREFORE, the petition is granted. The Orders promulgated on October 15, 1981 and December 2, 1981 are
ANNULLED AND SET ASIDE. The petitioner's deposit with the Trial Court of the amount of P170,061.03 is declared
to constitute full satisfaction of the judgment against it, and the Trial Court is DIRECTED to cause entry of said full
satisfaction of judgment, and declare the case closed and terminated as far as the petitioner is concerned. No
Costs.

SO ORDERED.

G.R. No. 109835 November 22, 1993

JMM PROMOTIONS & MANAGEMENT, INC., petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION and ULPIANO L. DE LOS SANTOS, respondent.

Don P. Porciuncula for petitioner.

Eulogio Nones, Jr. for private respondent.

CRUZ, J.:

The sole issue submitted in this case is the validity of the order of respondent National Labor Relations Commission
dated October 30, 1992, dismissing the petitioner's appeal from a decision of the Philippine Overseas Employment
Administration on the ground of failure to post the required appeal bond.1

The respondent cited the second paragraph of Article 223 of the Labor Code as amended, providing that:

In the case of a judgment involving a monetary award, an appeal by the employer may be perfected
only upon the posting of a cash or surety bond issued by a reputable bonding company duly
accredited by the Commission in an amount equivalent to the monetary award in the judgment
appealed from.

and Rule VI, Section 6 of the new Rules of Procedure of the NLRC, as amended, reading as follows:

Sec. 6. Bond — In case the decision of a Labor Arbiter involves a monetary award, an appeal by the
employer shall be perfected only upon the posting of a cash or surety bond issued by a reputable
bonding company duly accredited by the Commission or the Supreme Court in an amount equivalent
to the monetary award.

The petitioner contends that the NLRC committed grave abuse of discretion in applying these rules to decisions
rendered by the POEA. It insists that the appeal bond is not necessary in the case of licensed recruiters for
overseas employment because they are already required under Section 4, Rule II, Book II of the POEA Rules not
only to pay a license fee of P30,000 but also to post a cash bond of P100,000 and a surety bond of P50,000, thus:

Upon approval of the application, the applicant shall pay a license fee of P30,000. It shall also post a
cash bond of P100,000 and surety bond of P50,000 from a bonding company acceptable to the
Administration and duly accredited by the Insurance Commission. The bonds shall answer for all
valid and legal claims arising from violations of the conditions for the grant and use of the license,
and/or accreditation and contracts of employment. The bonds shall likewise guarantee compliance
 with the provisions of the Code and its implementing rules and regulations relating to recruitment
and placement, the Rules of the Administration and relevant issuances of the Department and all
liabilities which the Administration may impose. The surety bonds shall include the condition that the
notice to the principal is notice to the surety and that any judgment against the principal in
connection with matters falling under POEA's jurisdiction shall be binding and conclusive on the
surety. The surety bonds shall be co-terminus with the validity period of license. (Emphasis supplied)

In addition, the petitioner claims it has placed in escrow the sum of P200,000 with the Philippine National Bank in
compliance with Section 17, Rule II, Book II of the same Rule, "to primarily answer for valid and legal claims of
recruited workers as a result of recruitment violations or money claims."

Required to comment, the Solicitor General sustains the appeal bond requirement but suggest that the rules cited by
the NLRC are applicable only to decisions of the Labor Arbiters and not of the POEA. Appeals from decisions of the
POEA, he says, are governed by the following provisions of Rule V, Book VII of the POEA Rules:

Sec. 5. Requisites for Perfection of Appeal. The appeal shall be filed within the reglementary period
as provided in Section 1 of this Rule; shall be under oath with proof of payment of the required
appeal fee and the posting of a cash or surety bond as provided in Section 6 of this Rule; shall be
accompanied by a memorandum of appeal which shall state the grounds relied upon and the
arguments in support thereof; the relief prayed for; and a statement of the date when the appellant
received the appealed decision and/or award and proof of service on the other party of such appeal.

A mere notice of appeal without complying with the other requisites aforestated shall not stop the
running of the period for perfecting an appeal.

Sec. 6. Bond. In case the decision of the Administration involves a monetary award, an appeal by
the employer shall be perfected only upon the posting of a cash or surety bond issued by a reputable
bonding company duly accredited by the Commission in an amount equivalent to the monetary
award. (Emphasis supplied)

The question is, having posted the total bond of P150,000 and placed in escrow the amount of P200,000 as
required by the POEA Rules, was the petitioner still required to post an appeal bond to perfect its appeal from a
decision of the POEA to the NLRC?

It was.

The POEA Rules are clear. A reading thereof readily shows that in addition to the cash and surety bonds and the
escrow money, an appeal bond in an amount equivalent to the monetary award is required to perfect an appeal from
a decision of the POEA. Obviously, the appeal bond is intended to further insure the payment of the monetary award
in favor of the employee if it is eventually affirmed on appeal to the NLRC.

It is true that the cash and surety bonds and the money placed in escrow are supposed to guarantee the payment of
all valid and legal claims against the employer, but these claims are not limited to monetary awards to employees
whose contracts of employment have been violated. The POEA can go against these bonds also for violations by
the recruiter of the conditions of its license, the provisions of the Labor Code and its implementing rules, E.O. 247
(reorganizing POEA) and the POEA Rules, as well as the settlement of other liabilities the recruiter may incur.

As for the escrow agreement, it was presumably intended to provide for a standing fund, as it were, to be used only
as a last resort and not to be reduced with the enforcement against it of every claim of recruited workers that may be
adjudged against the employer. This amount may not even be enough to cover such claims and, even if it could
initially, may eventually be exhausted after satisfying other subsequent claims.

As it happens, the decision sought to be appealed grants a monetary award of about P170,000 to the dismissed
employee, the herein private respondent. The standby guarantees required by the POEA Rules would be depleted if
this award were to be enforced not against the appeal bond but against the bonds and the escrow money, making
them inadequate for the satisfaction of the other obligations the recruiter may incur.

Indeed, it is possible for the monetary award in favor of the employee to exceed the amount of P350,000, which is
the sum of the bonds and escrow money required of the recruiter.

It is true that these standby guarantees are not imposed on local employers, as the petitioner observes, but there is
a simple explanation for this distinction. Overseas recruiters are subject to more stringent requirement because of
the special risks to which our workers abroad are subjected by their foreign employers, against whom there is
usually no direct or effective recourse. The overseas recruiter is solidarily liable with a foreign employer. The bonds
and the escrow money are intended to insure more care on the part of the local agent in its choice of the foreign
principal to whom our overseas workers are to be sent.

It is a principle of legal hermeneutics that in interpreting a statute (or a set of rules as in this case), care should be
taken that every part thereof be given effect, on the theory that it was enacted as an integrated measure and not as
a hodge-podge of conflicting provisions. Ut res magis valeat quam pereat. 2 Under the petitioner's interpretation, the
appeal bond required by Section 6 of the aforementioned POEA Rule should be disregarded because of the earlier
bonds and escrow money it has posted. The petitioner would in effect nullify Section 6 as a superfluity but we do not
see any such redundancy; on the contrary, we find that Section 6 complements Section 4 and Section 17. The rule
is that a construction that would render a provision inoperative should be avoided; instead, apparently inconsistent
provisions should be reconciled whenever possible as parts of a coordinated and harmonious whole.

Accordingly, we hold that in addition to the monetary obligations of the overseas recruiter prescribed in Section 4,
Rule II, Book II of the POEA Rules and the escrow agreement under Section 17 of the same Rule, it is necessary to
post the appeal bond required under Section 6, Rule V, Book VII of the POEA Rules, as a condition for perfecting an
appeal from a decision of the POEA.

Every intendment of the law must be interpreted in favor of the working class, conformably to the mandate of the
Constitution. By sustaining rather than annulling the appeal bond as a further protection to the claimant employee,
this Court affirms once again its commitment to the interest of labor.

WHEREFORE, the petition is DISMISSED, with costs against the petitioner. It is so ordered.

Davide and Quiason, JJ., concur.

G.R. No. 75222 July 18, 1991

RADIOLA-TOSHIBA PHILIPPINES, INC., through its assignee-in-insolvency VICENTE J. CUNA, petitioner,

vs.
THE INTERMEDIATE APPELLATE COURT, HON. LEONARDO I. CRUZ, as Judge of the Regional Trial Court
of Angeles City, Branch No. LVI, EMILIO C. PATINO, as assignee-in-insolvency of CARLOS and TERESITA
GATMAYTAN, SHERIFF OF ANGELES CITY, REGISTER OF DEEDS OF ANGELES CITY, SANYO MARKETING
CORPORATION, S & T ENTERPRISES INC., REFRIGERATION INDUSTRIES INC., and DELTA MOTOR
CORPORATION, respondents.

Quisumbing, Torres & Evangelista for petitioner.

Procopio S. Beltran, Jr. for private respondents.

BIDIN, J.:

This is a petition for certiorari of the March 31, 1986 Decision of the then Intermediate Appellate Court * in A.C-G.R.
SP No. 04160 entitled "Radiola-Toshiba Philippines, Inc. vs. Hon. Leonardo I. Cruz, et al." denying the petition
for certiorari and mandamus; and its Resolution of July 1, 1986 denying the motion for reconsideration.

The antecedent facts of this case, as found by the then Intermediate Appellate Court, are as follows:

On July 2, 1980, three creditors filed a petition for the involuntary insolvency of Carlos Gatmaytan and
Teresita Gatmaytan, the private respondents herein, the case docketed as Special Proceeding No. 1548 of
the then Court of First Instance (now Regional Trial Court) of Pampanga and Angeles City.

On July 9, 1980, the respondent court issued an order taking cognizance of the said petition and stating inter
alia that:

. . . the Court forbids the payment of any debts, and the delivery of any property owing and
belonging to said respondents-debtors from other persons, or, to any other persons for the use and
benefit of the same respondents-debtors and/or the transfer of any property by and for the said
respondents-debtors to another, upon petitioners' putting up a bond by way of certified and reputable
sureties. (Annex 1, Comment).

Counsel for the petitioners-creditors informed respondent sheriff Angeles City of the aforesaid order (Annex 2, Ibid)
and on March 26, 1981, also communicated with counsel for the petitioner herein regarding same order, apprising
the latter that "the personal and real property which have been levied upon and/or attached should be preserved till
the final determination of the petition aforementioned." (Annex 3, Ibid).

On April 12, 1983, petitioners-creditors filed second urgent motion for issuance of insolvency order and resolution of
the case, alleging among other things, that in November, 1982, they filed an urgent motion to issue insolvency
order; on December 2, 1982, they presented a motion to prohibit the city sheriff of Angeles City from disposing the
personal and real properties of the insolvent debtors, Carlos Gatmaytan and Teresita Gatmaytan; on January 18,
1983, they (sic) appealed in the Bulletin Today issue of even date a news item to the effect that Radiola-Toshiba
Phil. Inc. has already shut down its factory, sometime in March 1983, through their representative, they caused to be
investigated the real properties in the names of Carlos Gatmaytan and Teresita Gatmaytan and they were surprised
to find out that some of the aforesaid properties were already transferred to Radiola-Toshiba Phil. Inc.; and that in
view of such development, it is their submission that without an insolvency order and a resolution of the case which
was ripe for resolution as early as March 3, 1982, the rights and interest of petitioners-creditors would be injured and
jeopardized. (Annex "C").

On April 15, 1983, petitioner filed an opposition to the said motion vis-a-vis the prayer that the insolvency order
(which has not been rendered yet by the court) be annotated on the transfer certificates of title already issued in its
name (Annex "D").

On April 22, 1983, judgment was rendered declaring the insolvency of respondents-debtors Carlos Gatmaytan and
Teresita Gatmaytan.

On April 28, 1983, petitioner filed a supplemental opposition to the same second urgent motion and motion to direct
respondent sheriff to issue a final certificate of sale for the properties covered by TCT Nos. 18905 and 40430 in its
favor (Annex "E").

On February 3, 1984, acting upon petitioner's motion claiming that ownership of certain real properties of the
insolvents had passed to it by virtue of foreclosure proceedings conducted in Civil Case No. 35946 of the former
Court of First Instance of Rizal, Branch II, Pasig, Metro Manila, which properties were not redeemed within the
period of redemption, respondent court issued an order disposing, thus:

WHEREFORE, the Court hereby, confirms the election of Mr. Emilio C. Patino, as assignee of all the
registered claimants in this case, and, in consequence thereof, the said assignee is hereby directed to post
a bond in the amount of P30,000.00 and to take his oath thereafter so as to be able to perform his duties
and discharge his functions, as such.

The Court, likewise, sets the meeting of all the creditors with the attendance, of course, of the assignee, on
March 9, 1984, at 8:30., as by that time the proposals, which the respective representatives of the parties-
claimants desire to clear with their principals, shall have already been reported.

The assignee shall see to it that the properties of the insolvents which are now in the actual or constructive
custody and management of the receiver previously appointed by the Court on petitioners' and claimants'
proposals be placed under this actual or constructive custody and management, such as he is able to do so,
as the Court hereby dissolves the receivership previously authorized, it having become a superfluity. (Annex
"F").

On May 18, 1984, the Regional Trial Court, Branch CLII, Pasig, Metro Manila, in Civil Case No. 35946, issued an
order directing respondent Sheriff of Angeles City, or whoever is acting in his behalf, to issue within seven (7) days
from notice thereof a final deed of sale over the two (2) parcels of land covered by Transfer Certificates of Titles
Nos. 18905 and 40430 in favor of petitioner. (Annex "G").

In said Civil Case No. 35946, a case for collection of sum of money covering the proceeds of television sets and
other appliances, the then Court of First Instance of Rizal, Branch II, Pasig, Metro Manila, issued a writ of
preliminary attachment on February 15, 1980 upon application of the petitioner, as plaintiff, which put up a bond of
P350,000.00. On March 4, 1980, 3:00 P.M., levy on attachment was done in favor of petitioner on the real properties
registered in the names of spouses Carlos Gatmaytan and Teresita Gatmaytan under TCT Nos. 18905 and 40430
of the Registry of Deeds of Angeles City, per Entry No. 7216 on said titles. (Annex "A" and "B").

On December 10, 1980, a decision was rendered in favor of petitioner, ordering private respondents and their co-
defendant Peoples Appliance Center, Inc. to pay petitioner, jointly and severally, the sum of P721,825.91 plus
interest thereon of 14% per annum from October 12, 1979 until fully paid; P20,000.00, for and attorney's fees; and
the costs of suit (Annex "5", Comment). After the said decision in the aforementioned Civil Case No. 35946 became
final and executory, a writ of execution for the satisfaction thereof issued on March 18, 1981; and on May 4, 1981,
respondent sheriff of Angeles City sold at auction sale the attached properties covered by TCT Nos. 18905 and
40430, to petitioner as the highest bidder, and the certificate of sale was accordingly issued in its favor.

On September 21, 1982, the court ordered the consolidation of ownership of petitioner over said properties; but
respondent sheriff of Angeles City refused to issue a final certificate of sale in favor of petitioner.

On May 30, 1984, petitioners-creditors interposed their opposition, stating among other things, that subject motion is
improper and premature because it treats of matters foreign to the insolvency proceedings; and premature, for the
reason that the properties covered by TCT Nos. 18905 and 40430-Angeles City were brought to the jurisdiction of
the insolvency court for the determination of the assets of the insolvents available for distribution to the approved
credits/liabilities of the insolvents. Petitioners-creditors theorized that the insolvency court is devoid of jurisdiction to
grant the motion referring to matters involved in a case pending before a coordinate court in another jurisdiction
(Annex "l").
Prior thereto or on July 13, 1984, to be precise, respondent court came out with its assailed extended order with the
following decretal portion:

WHEREFORE, and also for the reason stated in the aforequoted order issued in pursuance of a similar
motion of the movant, the Court denies, as it is hereby denied the motion of Radiola-Toshiba, dated May 28,
1984 and directs the latter to participate in the supposed meeting of all the creditors/claimants presided by
the duly elected assignee. (Annex "J").

On September 8, 1984, herein petitioner Radiola-Toshiba Philippines, Inc. (RTPI, for short) filed a petition
for certiorari and mandamus with respondent Intermediate Appellate Court.

The then Intermediate Appellate Court, in a Decision promulgated on March 31, 1986, denied petitioner's aforesaid
petition. On April 19, 1986, petitioner filed a motion for reconsideration, but the same was denied in a Resolution
dated July 1, 1986.

Hence, the instant petition. Herein petitioner raised two issues —

1. WHETHER OR NOT CERTIORARI IS A REMEDY DESIGNATED FOR THE CORRECTION OF ERRORS OF

JURISDICTION ONLY; and

2. WHETHER OR NOT THE REFUSAL OF THE COURTS TO ENFORCE THE LIEN OF PETITIONER ARISING
FROM A LEVY OF ATTACHMENT NOT MADE WITHIN ONE MONTH NEXT PRECEDING THE
COMMENCEMENT OF THE INSOLVENCY PROCEEDING IS GRAVE ABUSE OF DISCRETION.

The main issue in this case is whether or not the levy on attachment in favor of the petitioner is dissolved by the
insolvency proceedings against respondent spouses commenced four months after said attachment.

On this issue, Section 32 of the Insolvency Law (Act No. 1956, as amended), provides:

Sec. 32 — As soon as an assignee is elected or appointed and qualified, the clerk of the court shall, by an
instrument under his hand and seal of the court, assign and convey to the assignee all the real and personal
property, estate, and effects of the debtor with all his deeds, books, and papers relating thereto, and such
assignment shall relate back to the commencement of the proceedings in insolvency, and shall relate back
to the acts upon the adjudication was founded, and by operation of law shall vest the title to all such
property, estate, and effects in the assignee, although the same is then attached on mesne process, as the
property of the debtor. Such assignment shall operate to vest in the assignee all of the estate of the
insolvent debtor not exempt by law from execution. It shall dissolve any attachment levied within one month
next preceding the commencement of the insolvency proceedings and vacate and set aside any judgment
entered in any action commenced within thirty days immediately prior to the commencement of insolvency
proceedings and shall set aside any judgment entered by default or consent of the debtor within thirty days
immediately prior to the commencement of the insolvency proceedings. (Emphasis supplied)

Relative thereto, the findings of the then Intermediate Appellate Court are undisputed that the levy on attachment
against the subject properties of the Gatmaytans, issued by the then Court of First Instance of Pasig in Civil Case
No. 35946, was on March 4, 1980 while the insolvency proceeding in the then Court of First Instance of Angeles
City, Special Proceeding No. 1548, was commenced only on July 2, 1980, or more than four (4) months after the
issuance of the said attachment. Under the circumstances, petitioner contends that its lien on the subject properties
overrode the insolvency proceeding and was not dissolved thereby.

Private respondents, on the other hand, relying on Section 79 of the said law, which reads:

Sec. 79. When an attachment has been made and is not dissolved before the commencement of
proceedings in insolvency, or is dissolved by an undertaking given by the defendant, if the claim upon which
the attachment suit was commenced is proved against the estate of the debtor, the plaintiff may prove the
legal costs and disbursements of the suit, and of the keeping of the property, and the amount thereof shall
be a preferred debt.

and the fact that petitioner and its counsel have full knowledge of the proceedings in the insolvent case, argue that
the subsequent Certificate of Sale on August 3, 1981, issued in favor of petitioner over the subject properties, was
issued in bad faith, in violation of the law and is not equitable for the creditors of the insolvent debtors; and pursuant
to the above quoted Section 79, petitioner should not be entitled to the transfer of the subject properties in its name.

Petitioner's contention is impressed with merit. The provision of the above-quoted Section 32, of the Insolvency
1âwphi1

Law is very clear — that attachments dissolved are those levied within one (1) month next preceding the
commencement of the insolvency proceedings and judgments vacated and set aside are judgments entered in any
action, including judgment entered by default or consent of the debtor, where the action was filed within thirty (30)
days immediately prior to the commencement of the insolvency proceedings. In short, there is a cut off period —
one (1) month in attachment cases and thirty (30) days in judgments entered in actions commenced prior to the
insolvency proceedings. Section 79, on the other hand, relied upon by private respondents, provides for the right of
the plaintiff if the attachment is not dissolved before the commencement of proceedings in insolvency, or is
dissolved by an undertaking given by the defendant, if the claim upon which the attachment suit was commenced is
proved against the estate of the debtor. Therefore, there is no conflict between the two provisions.

But even granting that such conflict exists, it may be stated that in construing a statute, courts should adopt a
construction that will give effect to every part of a statute, if at all possible. This rule is expressed in the maxim, ut
maqis valeat quam pereat or that construction is to be sought which gives effect to the whole of the statute — its
every word. Hence, where a statute is susceptible of more than one interpretation, the court should adopt such
reasonable and beneficial construction as will render the provision thereof operative and effective and harmonious
with each other (Javellana vs. Tayo, 6 SCRA 1042 [1962]; Statutory Construction by Ruben E. Agpalo, p. 182).

Neither can the sheriff's sale in execution of the judgment in favor of the petitioner be considered as a fraudulent
transfer or preference by the insolvent debtors, which constitute a violation of Sec. 70 of the Insolvency Law. In the
case of Velayo vs. Shell Co. of the Philippines (100 Phil. 187, [1956]), this Court ruled that Sections 32 and 70
contemplate only acts and transactions occurring within 30 days prior to the commencement of the proceedings in
insolvency and, consequently, all other acts outside of the 30-day period cannot possibly be considered as coming
within the orbit of their operation.

Finally, petitioner correctly argued that the properties in question were never placed under the jurisdiction of
respondent insolvency court so as to be made available for the payment of claim filed against the Gatmaytans in the
insolvency proceedings.

Hence, the denial by respondent insolvency court to give due course to the attachment and execution of Civil Case
No. 35946 of the CFI of Rizal constitutes a freezing of the disposition of subject properties by the former which were
not within its jurisdiction; undeniably, a grave abuse of discretion amounting to want of jurisdiction, correctable
by certiorari.

WHEREFORE, the March 31, 1986 decision of the then Intermediate Appellate Court is hereby Reversed and SET
ASIDE. The attachment and execution sale in Civil Case No. 35946 of the former CFI of Rizal are given due course
and petitioner's ownership of subject properties covered by TCT Nos. 18905 and 40430 is ordered consolidated.

SO ORDERED.

G.R. No. L-7482 December 28, 1912

THE UNITED STATES, plaintiff-appellee,

vs.
TEN YU, ET AL., defendants-appellants.

L.M. Southworth, for appellants.

Office of the Solicitor-General Harvey, for appellee.

JOHNSON, J.:

On or about the 11th day of October, 1911, a complaint was presented against said defendants in the municipal
court of the city of Manila accusing them of a violation of section 3 of Ordinance No. 152 of the city of Manila. They
were duly arraigned. After hearing the evidence the Hon. Manuel Camus, judge of said municipal court, found each
of the defendants guilty of the offense charged and sentenced each of them to pay a fine of P100. From that
sentence each of the defendants appealed to the Court of First Instance of the city of Manila.

The complaint presented against the defendants alleged:

That on or about October 10, 1911, in the city of Manila, Philippine Islands, the said defendants, at that time
and in that place, did willfully and unlawfully visit and were found in and within a place where opium was
smoked and in some way or other used in or upon the human body and where it was sold, distributed, or
where it was disposed of in some way or other, to wit, No. 408 Calle Salazar, Binondo, with infraction of the
ordinances of the city of Manila.

To the complaint the defendants presented a demurrer. The demurrer alleged:

I. That the ordinance whereunder this complaint has been presented is and ought to be declared null and
void for the reason that the Municipal Board of the city of Manila neither did nor does have legal authority to
enact it.
 II. That the ordinance whereunder this complaint has been presented is unreasonable, for it punishes the
presence of anyone who may visit an opium joint or a place where opium is kept, sold or smoked, without
considering whether said visit has a lawful or unlawful purpose or is with or without knowledge of the nature
of such place.

III. That the ordinance whereunder this complaint has been presented is and ought to be declared null and
void, for it imposes a cruel and excessive punishment upon persons who may without knowledge or criminal
intent violate its provisions.

IV. That the complaint in this case does not contain facts sufficient to constitute a public crime.

After hearing the evidence pro and con, upon the questions presented by said demurrer, the Hon. A.S. Crossfield,
judge, overruled the demurrer, stating that "the grounds of demurrer in this case are identical with those in case No.
7949, U.S. vs. Chua Ong
et al. 1 I see no reason for changing the conclusion arrived at in that case. The complaint states a cause of action.
The demurrer is overruled."

In case No. 7949, U.S. vs. Chua Ong et al., 1 to which the Honorable Judge Crossfield makes reference in his order
overruling the demurrer in the present case, the following, among other things, was given as the ground for
overruling the demurrer:

Counsel contends that by the general law in relation to the use and possession of opium this provision of the
character of Manila has been placed in abeyance. I am of the opinion that Act No. 1761 which amended
1aw phil.net

and repealed Act No. 1461 of the Philippine Commission has in no way affected the charter of Manila. The
Municipal Board then had legislative authority which was conferred upon it, and the authority thus conferred
included the making of ordinances necessary to carry out the powers conferred by the charter, and to fix the
penalty within certain limits, and one of these powers was to provide for the closing of opium joints and to
prohibit the keeping or visiting of places where opium was smoked.

The ordinance in question prohibits places where opium is smoked or dealth in — prohibits opium joints. The
two sections (of the ordinance) are practically the same. The ordinance prohibits the visiting or being present
at a place where opium is smoked or sold, and I am of the opinion that this is within the power of the board.
The fact that the ordinance adds to the visiting, specifically mentioned in the powers of the board, "or being
present at" does not affect the legality of the prohibition of visiting. ... The fact that the charter provides that
no fine shall exceed $100 (P200) and no imprisonment shall exceed six months, is not exceeded by the
statement that either one of the penalties provided may be imposed by adding thereto that both the fine and
imprisonment may be imposed in the discretion of the court.

With regard to the objection made on the ground that the punishment is cruel and unusual because it
provides for the punishment of innocent persons, I am of the opinion that the ordinance does not so provide.
It must clearly be read and understood in the light of the general rule with regard to the intention of persons
when violating its terms. The person going to a place where opium was sold without knowledge of the fact
would not be visiting it in contemplation of this ordinance; neither if he had legal business to transact at a
place where opium was sold and visited it for the purpose of transacting his lawful business only and so
doing he would not be visiting a place where opium is sold in contemplation of this ordinance. I am of the
opinion that the grounds of the demurrer are not well taken. The demurrer is overruled.

Immediately following the overruling of the demurrer the said defendants were placed upon trial. After hearing the
evidence the Honorable A.S. Crossfield found that the evidence was insufficient to show that Dee Ong, Uy Chong,
Chit Eng, Co Lo, Ong Tui Co, Gaw Kee, and Tian Hi were guilty of the crime charged and dismissed the complaint
against them and discharged each one of them from the custody of the law. The lower court found, however, that
the evidence was sufficient to show that Ten Yu, Tin Quac, Lim Yan, Ong To, Yeng Sing, and Co King were guilty of
the crime charged and sentenced each of them to pay a fine of P100 and each one-thirteenth part of the costs, and
in case the fine be not paid, that each of the sentenced defendants be imprisoned at Bilibid Prison until their
respective fines be satisfied at the rate of P1 per day.

From that sentence the defendants appealed and in this court presented the following assignments of error:

I. That the ordinance whereunder this information has been filed is and ought to be declared null and void,
for the reason that the Municipal Board of the city of Manila did not have legal authority to enact said
ordinance.

II. That the ordinance whereunder this information has been filed is unreasonable in so far as section 3
thereof is concerned, for it imposes a penalty upon any person who may visit or be present in or within any
place where opium is smoked, etc., without considering whether or not said visit was made with a lawful or
unlawful object or whether or not said visitor was aware of the nature of said place.
 III. That the ordinance whereunder this information has been filed ought to be declared null and void for the
reason that it imposes a cruel and excessive punishment upon persons who may without knowledge or
criminal intent violate its provisions.

IV. That the information filed in this case does not contain facts sufficient to constitute a public crime. With
itc@alf

reference to the first assignment of error above noted, the appellant correctly states the rule relating to the
general powers of municipal corporations. It is, that municipal corporations have only such powers as are
expressly delegated to them and such other powers as are necessarily implied from such express powers.
With this definition of the general powers of municipal corporations, let us examine the powers which are
delegated to the city of Manila with reference to the particular ordinance in question. Omitting the provisions
of the charter relating to the organization of the city of Manila, we have in section 11 (charter of Manila, Act
No. 183) the power to legislate or the power to enact ordinances or laws expressly conferred. In section 16
we find that the Municipal Board of the city of Manila "shall make such ordinances or regulations as may be
necessary to carry into effect the discharge of the powers and duties conferred by this Act, and to provide for
the peace, order, safety, and general welfare of the city and its inhabitants; shall fix the penalties for the
violation of the ordinances, provided that no fine shall exceed $100 (P200) and no penalty shall exceed six
months for a single offense. The board shall see that the laws and ordinances are faithfully executed and
enforced; and shall have such further powers and perform such further duties as may be prescribed by law. law phi 1.net

By reference to paragraph (ff) of section 17 (Act No. 183), we find that the Municipal Board of the city of Manila is
empowered, in addition to the powers enumerated in said section 16, "to provide for the closing of opium joints and
to prohibit the keeping or visiting of any place where opium is smoked or sold for the purpose of smoking."

Assuming to act under the authority conferred in said paragraph (ff) of section 17, the Municipal Board of the city of
Manila adopted ordinance No. 152, the sections of which relating to the questions under consideration are as
follows:

ORDINANCE NO. 152.

SECTION 1. Opium joints prohibited. — No person shall keep, conduct, or maintain any opium joint within
the city of Manila.

SEC. 2. Places where opium is smoked or dealt in prohibited. — No person shall keep, conduct, or maintain
any place where opium in any form, or any of its derivatives or compounds, is either smoked or otherwise
used in or upon the human body, or is unlawfully sold, given away, or otherwise disposed of.

SEC. 3. Visiting places where opium is smoked or dealt in is prohibited. — No person shall visit or be
present at or in any place where opium, or any of its derivatives or compounds, is smoked or otherwise used
in or upon the human body, or unlawfully sold, given away, or otherwise disposed of.

xxx xxx xxx

SEC. 5 Penalty. — Any person violating any of the provisions of this ordinance shall, upon conviction, be
punished by a fine of not less than one hundred pesos nor more than two hundred pesos, or by
imprisonment for not less than one month nor more than six months, or both such fine and imprisonment in
the discretion of the court.

By referring to section 3 of said ordinance and comparing the same with paragraph (ff), we find an express provision
of the charter of the city of Manila, conferring what appears to be full and ample power upon the municipal board for
the adoption of said ordinance. It would be difficult to find an ordinance which is more nearly within the express
powers conferred upon a municipal board than that in the present case for the adoption of said Ordinance No. 152.
In our opinion, the Municipal Board of the city of Manila had full authority to adopt said ordinance and the same is
also in accordance with the general spirit and policy of the laws of the state relating to the use of opium.

With reference to the second assignment of error, the appellant alleges that it is unreasonable, in that section 3
imposes a penalty upon any person who may visit the places described in said ordinance. The appellant attempts to
make it appear that any person, even though lawfully visiting the places described in said ordinance, might be
punished. We think this interpretation of said ordinance is not justified. It will be noted that the complaint charges
that the defendants "unlawfully visited, etc." This allegation the defendants may prove, if the fact exists, that they
visited the place described in the complaint lawfully and not in violation of the provisions nor the spirit of said
ordinance.

Ordinances of the class under consideration are not at all uncommon. Many cities have ordinances prohibiting
people from visiting houses of ill fame; children from visiting saloons where alcoholic liquors are sold, and many
others of a similar class. In the case of State vs. Botkin (71 Iowa, 87) the facts are very similar to those in the
present case. In that case an ordinance of the city of Des Moines of the State of Iowa provided that "any person who
should be found in or frequenting any disorderly house shall be subject to a fine." Under that ordinance the
defendant (Botkin) was arrested, arraigned and convicted of a violation of the same in the municipal court of said
city. He applied for the writ of habeas corpus in the courts of the State, upon the ground that he was
being unlawfully restrained of his liberty, by reason of the sentence under said ordinance, alleging that the ordinance
was void. The court of first instance (the district court) granted the writ of habeas corpus upon the ground that the
ordinance was void and illegal. From that conclusion an appeal was taken to the supreme court of the State of Iowa,
where the decision of the court of first instance was reversed, the court holding that the city had full authority to
adopt said ordinance and that the sentence of the municipal court was valid, and ordered the defendant returned to
the custody of the city authorities for the enforcement of the decision of said municipal court. The district court in that
case (State vs. Botkin) held that the ordinance was void for the reason that it failed to prescribe that, to render one
guilty of the offense prohibited, he shall be unlawfully in the house and that, under the language of the ordinance,
one found in a disorderly house is guilty, though he be there for a lawful or innocent purpose.

The supreme court, in passing upon that part of the decision of the lower court, said:

This decision [position] of the court below is clearly unsound, and in violation of the familiar rules of the
construction and interpretation of statutes. The subject matter, effect and consequences, and the reason
and spirit of a statute must be considered, as well as its words, in interpreting and construing it. A statute,
intending to prohibit an offense, will, under these rules, never be applied to an innocent [and] lawful
act. The offense is prohibited and not the lawful act. Hence, if an act is done which is prohibited by the
words of the statute, it may be shown to be lawfully or innocently done. ... The court below thought that, as
the ordinance imposes upon the accused the burden of showing his lawful presence in a disorderly house, it
is void; but it is competent for the legislature to prescribe that an offense may be presumed from an act
done. The ordinance in question, as we have seen, is intended to forbid unlawful presence in a disorderly
house and is to be so interpreted. The presence should be charged in the information as unlawful. As a
defense, the person charged may show that he was lawfully or innocently in the house. These rules are of
constant application in the administration of the criminal law. (Introduction to Blackstone's Commentaries, by
Judge Cooley, sec. 2, pp. 59-62. Ex Parte Johnson, 73 Cal., 228.)

In the present case we have the express provision of the charter of the city of Manila (Act No. 183, sec. 17, par. (ff)
conferring upon said city the right to adopt the ordinance in question (152). The punishment imposed by said
ordinance is also within the express power of said city, as defined by its charter.

In our opinion the contention that the ordinance in question is unreasonable is not tenable.

Courts are slow to pronounce statutes invalid or void. The question of the validity of every statute is first determined
by the legislative department of the government itself, and the courts should resolve every presumption in favor of
its validity. Courts are not justified in adjudging statutes in valid, in the face of the conclusion of the legislature, when
the question of its validity is at all doubtful. The courts must assume that the validity of the statute was fully
considered by the legislature when adopted. Courts will not presume a statute invalid unless it clearly appears that it
falls within some of the inhibitions of the fundamental laws of the state. The wisdom or advisability of a particular
statute is not a question for the courts to determine — that is a question for the legislature to determine. The courts
may or may not agree with the legislature upon the wisdom or necessity of the law. Their disagreement, however,
furnishes no basis for pronouncing a statute illegal. If the particular statute is within the constitutional power of the
legislature to enact, whether the courts agree or not in the wisdom of its enactment, is a matter of no concern. Upon
the other hand, however, if the statute covers subjects not authorized by the fundamental laws of the land or its
constitution, then the courts are not only authorized but are justified in pronouncing the same illegal and void, no
matter how wise or beneficent such legislation may seem to be.

Courts are not justified in measuring their opinion with the opinion of the legislative department of the government,
as expressed in statutes, upon questions of the wisdom, justice or advisability of a particular law.

In exercising the higher authority conferred upon the courts to pronounce valid or invalid a particular statute, they
are only the administrators of the public will, as expressed in the fundamental laws of the land. If an act of the
legislature is held illegal, it is not because the judges have any control over the legislative power, but because the
act is forbidden by the fundamental laws of the land and because the will of the people, as declared by such
fundamental laws, is paramount and must obeyed, even by the legislature. In pronouncing a statute illegal, the
courts are simply interpreting the meaning, force and application of the fundamental laws of the state. (Lindsay et
al. vs. Commissioners, 2 Bay (S.C.), 61; State Board of Health vs. City of Greenville, 98 N.E. Reporter (Ohio, April
2, 1912), 1019. Dissenting opinion of the late Justice Harlan, Standard Oil Company vs. U.S., 211 U.S., 1.)

We find no occasion for modifying or reversing the sentence of the lower court based upon the second assignment
of error.

What we have said with reference to the second assignment of error, we believe fully answers the third.

With reference to the fourth assignment of error, we are of the opinion that the facts stated in the complaint are
sufficient, if true, to show that the defendants are guilty of the crime charged.

While we have discussed at length each of the assignments of error made by the appellants, nevertheless, the only
question, in fact, presented by the appeal under the law, in the first instance, is whether or not the ordinance under
which the defendants were sentenced is legal. Having concluded that said ordinance is legal and within the express
powers of the Municipal Board to enact, the appeal must be dismissed, with costs in this instance against the
appellants in equal parts.

It is therefore ordered and decreed, hereby, that the appeal be dismissed and that the cause be remanded to the
lower court for the execution of the sentence heretofore rendered.

Arellano, C.J., Torres, Mapa, Carson, and Trent, JJ., concur.

G.R. No. 90501 August 5, 1991

ARIS (PHIL.) INC., petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER FELIPE GARDUQUE III, LEODEGARIO DE
GUZMAN, LILIA PEREZ, ROBERTO BESTAMONTE, AIDA OPENA, REYNALDO TORIADO, APOLINARIO
GAGAHINA, RUFINO DE CASTRO, FLORDELIZA RAYOS DEL SOL, STEVE SANCHO, ESTER CAIRO,
MARIETA MAGALAD, and MARY B. NADALA, respondents.

Cesar C. Cruz & Partners for petitioner.

Zosimo Morillo for respondent Rayos del Sol.

Banzuela, Flores, Miralles, Raneses, Sy & Associates for private respondents.

DAVIDE, JR., J.:

Petitioner assails the constitutionality of the amendment introduced by Section 12 of Republic Act No. 6715 to
Article 223 of the Labor Code of the Philippines (PD No. 442, as amended) allowing execution pending appeal of the
reinstatement aspect of a decision of a labor arbiter reinstating a dismissed or separated employee and of Section 2
of the NLRC Interim Rules on Appeals under R.A. No. 6715 implementing the same. It also questions the validity of
the Transitory Provision (Section 17) of the said Interim Rules.

The challenged portion of Section 12 of Republic Act No. 6715, which took effect on 21 March 1989, reads as
follows:

SEC 12. Article 223 of the same code is amended to read as follows:

ART. 223. Appeal.

xxx xxx xxx

In any event, the decision of the Labor Arbiter reinstating a dismissed or separated employee, in so far as
the reinstatement aspect is concerned, shall immediately be executory, even pending appeal. The employee
shall either be admitted back to work under the same terms and conditions prevailing prior to his dismissal
or separation or, at the option of the employer, merely reinstated in the payroll. The posting of a bond by the
employer shall not stay the execution for reinstatement provided therein.

This is a new paragraph ingrafted into the Article.

Sections 2 and 17 of the "NLRC Interim Rules On Appeals Under R.A. No. 6715, Amending the Labor Code", which
the National Labor Relations Commission (NLRC) promulgated on 8 August 1989, provide as follows:

Section 2. Order of Reinstatement and Effect of Bond. — In so far as the reinstatement aspect is concerned,
the decision of the Labor Arbiter reinstating a dismissed or separated employee shall immediately be
executory even pending appeal. The employee shall either be admitted back to work under the same terms
and conditions prevailing prior to his dismissal or separation, or, at the option of the employer, merely be
reinstated in the payroll.

The posting of a bond by the employer shall not stay the execution for reinstatement.

xxx xxx xxx

 Section 17. Transitory provision. — Appeals filed on or after March 21, 1989, but prior to the effectivity of
these Interim Rules must conform to the requirements as herein set forth or as may be directed by the
Commission.

The antecedent facts and proceedings which gave rise to this petition are not disputed:

On 11 April 1988, private respondents, who were employees of petitioner, aggrieved by management's failure to
attend to their complaints concerning their working surroundings which had become detrimental and hazardous,
requested for a grievance conference. As none was arranged, and believing that their appeal would be fruitless,
they grouped together after the end of their work that day with other employees and marched directly to the
management's office to protest its long silence and inaction on their complaints.

On 12 April 1988, the management issued a memorandum to each of the private respondents, who were identified
by the petitioner's supervisors as the most active participants in the rally requiring them to explain why they should
not be terminated from the service for their conduct. Despite their explanation, private respondents were dismissed
for violation of company rules and regulations, more specifically of the provisions on security and public order and
on inciting or participating in illegal strikes or concerted actions.

Private respondents lost no time in filing a complaint for illegal dismissal against petitioner and Mr. Gavino Bayan
with the regional office of the NLRC at the National Capital Region, Manila, which was docketed therein as NLRC-
NCR-00-0401630-88.

After due trial, Labor Arbiter Felipe Garduque III handed down on 22 June 1989 a decision' the dispositive portion of
which reads:

ACCORDINGLY, respondent Aris (Phils.), Inc. is hereby ordered to reinstate within ten (10) days from
receipt hereof, herein complainants Leodegario de Guzman, Rufino de Castro, Lilia M. Perez, Marieta
Magalad, Flordeliza Rayos del Sol, Reynaldo Toriado, Roberto Besmonte, Apolinario Gagahina, Aidam (sic)
Opena, Steve C. Sancho Ester Cairo, and Mary B. Nadala to their former respective positions or any
substantial equivalent positions if already filled up, without loss of seniority right and privileges but with
limited backwages of six (6) months except complainant Leodegario de Guzman.

All other claims and prayers are hereby denied for lack of merit.

SO ORDERED.

On 19 July 1989, complainants (herein private respondents) filed a Motion For Issuance of a Writ of
Execution2pursuant to the above-quoted Section 12 of R.A. No. 6715.

On 21 July 1989, petitioner filed its Appeal.3

On 26 July 1989, the complainants, except Flor Rayos del Sol, filed a Partial Appeal.4

On 10 August 1989, complainant Flor Rayos del Sol filed a Partial Appeal.5

On 29 August 1989, petitioner filed an Opposition6 to the motion for execution alleging that Section 12 of R.A. No.
6715 on execution pending appeal cannot be applied retroactively to cases pending at the time of its effectivity
because it does not expressly provide that it shall be given retroactive effect7 and to give retroactive effect to Section
12 thereof to pending cases would not only result in the imposition of an additional obligation on petitioner but would
also dilute its right to appeal since it would be burdened with the consequences of reinstatement without the benefit
of a final judgment. In their Reply8 filed on 1 September 1989, complainants argued that R.A. No. 6715 is not sought
to be given retroactive effect in this case since the decision to be executed pursuant to it was rendered after the
effectivity of the Act. The said law took effect on 21 March 1989, while the decision was rendered on 22 June 1989.

Petitioner submitted a Rejoinder to the Reply on 5 September 1989.9

On 5 October 1989, the Labor Arbiter issued an Order granting the motion for execution and the issuance of a
partial writ of execution10 as far as reinstatement of herein complainants is concerned in consonance with the
provision of Section 2 of the rules particularly the last sentence thereof.

In this Order, the Labor Arbiter also made reference to Section 17 of the NLRC Interim Rules in this wise:

Since Section 17 of the said rules made mention of appeals filed on or after March 21, 1989, but prior to the
effectivity of these interim rules which must conform with the requirements as therein set forth (Section 9) or
as may be directed by the Commission, it obviously treats of decisions of Labor Arbiters before March
21,1989. With more reason these interim rules be made to apply to the instant case since the decision
hereof (sic) was rendered thereafter.11
Unable to accept the above Order, petitioner filed the instant petition on 26 October 198912 raising the issues
adverted to in the introductory portion of this decision under the following assignment of errors:

A. THE LABOR ARBITER A QUO AND THE NLRC, IN ORDERING THE REINSTATEMENT OF THE
PRIVATE RESPONDENTS PENDING APPEAL AND IN PROVIDING FOR SECTION 2 OF THE INTERIM
RULES, RESPECTIVELY, ACTED WITHOUT AND IN EXCESS OF JURISDICTION SINCE THE BASIS
FOR SAID ORDER AND INTERIM RULE, i.e., SECTION 12 OF R.A. 6715 IS VIOLATIVE OF THE
CONSTITUTIONAL GUARANTY OF DUE PROCESS IT BEING OPPRESSIVE AND UNREASONABLE.

B. GRANTING ARGUENDO THAT THE PROVISION IN(SIC) REINSTATEMENT PENDING APPEAL IS

VALID, NONETHELESS, THE LABOR ARBITER A QUO AND THE NLRC STILL ACTED IN EXCESS AND
WITHOUT JURISDICTION IN RETROACTIVELY APPLYING SAID PROVISION TO PENDING LABOR
CASES.

In Our resolution of 7 March 1989, We required the respondents to comment on the petition.

Respondent NLRC, through the Office of the Solicitor General, filed its Comment on 20 November 1989.13 Meeting
squarely the issues raised by petitioner, it submits that the provision concerning the mandatory and automatic
reinstatement of an employee whose dismissal is found unjustified by the labor arbiter is a valid exercise of the
police power of the state and the contested provision "is then a police legislation."

As regards the retroactive application thereof, it maintains that being merely procedural in nature, it can apply to
cases pending at the time of its effectivity on the theory that no one can claim a vested right in a rule of procedure.
Moreover, such a law is compatible with the constitutional provision on protection to labor.

On 11 December 1989, private respondents filed a Manifestation14 informing the Court that they are adopting the
Comment filed by the Solicitor General and stressing that petitioner failed to comply with the requisites for a valid
petition for certiorari under Rule 65 of the Rules of Court.

On 20 December 1989, petitioner filed a Rejoinder15 to the Comment of the Solicitor General.

In the resolution of 11 January 1990,16 We considered the Comments as respondents' Answers, gave due course to
the petition, and directed that the case be calendared for deliberation.

In urging Us to declare as unconstitutional that portion of Section 223 of the Labor Code introduced by Section 12 of
R.A. No. 6715, as well as the implementing provision covered by Section 2 of the NLRC Interim Rules, allowing
immediate execution, even pending appeal, of the reinstatement aspect of a decision of a labor arbiter reinstating a
dismissed or separated employee, petitioner submits that said portion violates the due process clause of the
Constitution in that it is oppressive and unreasonable. It argues that a reinstatement pending appeal negates the
right of the employer to self-protection for it has been ruled that an employer cannot be compelled to continue in
employment an employee guilty of acts inimical to the interest of the employer; the right of an employer to dismiss is
consistent with the legal truism that the law, in protecting the rights of the laborer, authorizes neither the oppression
nor the destruction of the employer. For, social justice should be implemented not through mistaken sympathy for or
misplaced antipathy against any group, but even-handedly and fairly.17

To clinch its case, petitioner tries to demonstrate the oppressiveness of reinstatement pending appeal by portraying
the following consequences: (a) the employer would be compelled to hire additional employees or adjust the duties
of other employees simply to have someone watch over the reinstated employee to prevent the commission of
further acts prejudicial to the employer, (b) reinstatement of an undeserving, if not undesirable, employee may
demoralize the rank and file, and (c) it may encourage and embolden not only the reinstated employees but also
other employees to commit similar, if not graver infractions.

These rationalizations and portrayals are misplaced and are purely conjectural which, unfortunately, proceed from a
misunderstanding of the nature and scope of the relief of execution pending appeal.

Execution pending appeal is interlinked with the right to appeal. One cannot be divorced from the other. The latter
may be availed of by the losing party or a party who is not satisfied with a judgment, while the former may be
applied for by the prevailing party during the pendency of the appeal. The right to appeal, however, is not a
constitutional, natural or inherent right. It is a statutory privilege of statutory origin18 and, therefore, available only if
granted or provided by statute. The law may then validly provide limitations or qualifications thereto or relief to the
prevailing party in the event an appeal is interposed by the losing party. Execution pending appeal is one such relief
long recognized in this jurisdiction. The Revised Rules of Court allows execution pending appeal and the grant
thereof is left to the discretion of the court upon good reasons to be stated in a special order.19

Before its amendment by Section 12 of R.A. No. 6715, Article 223 of the Labor Code already allowed execution of
decisions of the NLRC pending their appeal to the Secretary of Labor and Employment.
In authorizing execution pending appeal of the reinstatement aspect of a decision of the Labor Arbiter reinstating a
dismissed or separated employee, the law itself has laid down a compassionate policy which, once more, vivifies
and enhances the provisions of the 1987 Constitution on labor and the working-man.

These provisions are the quintessence of the aspirations of the workingman for recognition of his role in the social
and economic life of the nation, for the protection of his rights, and the promotion of his welfare. Thus, in the Article
on Social Justice and Human Rights of the Constitution,20 which principally directs Congress to give highest priority
to the enactment of measures that protect and enhance the right of all people to human dignity, reduce social,
economic, and political inequalities, and remove cultural inequities by equitably diffusing wealth and political power
for the common good, the State is mandated to afford full protection to labor, local and overseas, organized and
unorganized, and promote full employment and equality of employment opportunities for all; to guarantee the rights
of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including
the right to strike in accordance with law, security of tenure, human conditions of work, and a living wage, to
participate in policy and decision-making processes affecting their rights and benefits as may be provided by law;
and to promote the principle of shared responsibility between workers and employers and the preferential use of
voluntary modes in settling disputes. Incidentally, a study of the Constitutions of various nations readily reveals that
it is only our Constitution which devotes a separate article on Social Justice and Human Rights. Thus, by no less
than its fundamental law, the Philippines has laid down the strong foundations of a truly just and humane society.
This Article addresses itself to specified areas of concern labor, agrarian and natural resources reform, urban land
reform and housing, health, working women, and people's organizations and reaches out to the underprivileged
sector of society, for which reason the President of the Constitutional Commission of 1986, former Associate Justice
of this Court Cecilia Muñoz-Palma, aptly describes this Article as the "heart of the new Charter."21

These duties and responsibilities of the State are imposed not so much to express sympathy for the workingman as
to forcefully and meaningfully underscore labor as a primary social and economic force, which the Constitution also
expressly affirms With equal intensity.22 Labor is an indispensable partner for the nation's progress and stability.

If in ordinary civil actions execution of judgment pending appeal is authorized for reasons the determination of which
is merely left to the discretion of the judge, We find no plausible reason to withhold it in cases of decisions
reinstating dismissed or separated employees. In such cases, the poor employees had been deprived of their only
source of livelihood, their only means of support for their family their very lifeblood. To Us, this special circumstance
is far better than any other which a judge, in his sound discretion, may determine. In short, with respect to decisions
reinstating employees, the law itself has determined a sufficiently overwhelming reason for its execution pending
appeal.

The validity of the questioned law is not only supported and sustained by the foregoing considerations. As
contended by the Solicitor General, it is a valid exercise of the police power of the State. Certainly, if the right of an
employer to freely discharge his employees is subject to regulation by the State, basically in the exercise of its
permanent police power on the theory that the preservation of the lives of the citizens is a basic duty of the State,
that is more vital than the preservation of corporate profits.23 Then, by and pursuant to the same power, the State
may authorize an immediate implementation, pending appeal, of a decision reinstating a dismissed or separated
employee since that saving act is designed to stop, although temporarily since the appeal may be decided in favor
of the appellant, a continuing threat or danger to the survival or even the life of the dismissed or separated
employee and its family.

The charge then that the challenged law as well as the implementing rule are unconstitutional is absolutely
baseless. Laws are presumed constitutional.24 To justify nullification of a law, there must be a clear and unequivocal
1âw phi 1

breach of the Constitution, not a doubtful and argumentative implication; a law shall not be declared invalid unless
the conflict with the constitution is clear beyond reasonable doubt.25 In Parades, et al. vs. Executive Secretary26 We
stated:

2. For one thing, it is in accordance with the settled doctrine that between two possible constructions, one
avoiding a finding of unconstitutionality and the other yielding such a result, the former is to be preferred.
That which will save, not that which will destroy, commends itself for acceptance. After all, the basic
presumption all these years is one of validity. The onerous task of proving otherwise is on the party seeking
to nullify a statute. It must be proved by clear and convincing evidence that there is an infringement of a
constitutional provision, save in those cases where the challenged act is void on its face. Absent such a
showing, there can be no finding of unconstitutionality. A doubt, even if well-founded, does not suffice.
Justice Malcolm's aphorism is apropos: To doubt is to sustain.27

The reason for this:

... can be traced to the doctrine of separation of powers which enjoins on each department a proper respect
for the acts of the other departments. ... The theory is that, as the joint act of the legislative and executive
authorities, a law is supposed to have been carefully studied and determined to be constitution before it was
finally enacted. Hence, as long as there is some other basis that can be used by the courts for its decision,
the constitutionality of the challenged law will not be touched upon and the case will be decided on other
available grounds.28
The issue concerning Section 17 of the NLRC Interim Rules does not deserve a measure of attention. The reference
to it in the Order of the Labor Arbiter of 5 October 1989 was unnecessary since the procedure of the appeal proper
is not involved in this case. Moreover, the questioned interim rules of the NLRC, promulgated on 8 August 1989, can
validly be given retroactive effect. They are procedural or remedial in character, promulgated pursuant to the
authority vested upon it under Article 218(a) of the Labor Code of the Philippines, as amended. Settled is the rule
that procedural laws may be given retroactive effect.29 There are no vested rights in rules of procedure.30 A remedial
statute may be made applicable to cases pending at the time of its enactment.31

WHEREFORE, the petition is hereby DISMISSED for lack of merit. Costs against petitioner.

SO ORDERED.

JOVENCIO LIM and TERESITA LIM, Petitioners, v. THE PEOPLE OF THE PHILIPPINES, THE REGIONAL TRIAL
COURT OF QUEZON CITY, BRANCH 217, THE CITY PROSECUTOR OF QUEZON CITY, AND WILSON
CHAM, Respondents.

DECISION

CORONA, J.:

The constitutionality of PD 818, a decree which amended Article 315 of the Revised Penal Code by increasing the penalties
for estafa committed by means of bouncing checks, is being challenged in this petition for certiorari, for being violative of the
due process clause, the right to bail and the provision against cruel, degrading or inhuman punishment enshrined under the
Constitution.chanrob1e s virtua1 1aw 1 ibra ry

The antecedents of this case, as gathered from the parties’ pleadings and documentary proofs, follow.

In December 1991, petitioner spouses issued to private respondent two postdated checks, namely, Metrobank check no.
464728 dated January 15, 1992 in the amount of P365,750 and Metrobank check no. 464743 dated January 22, 1992 in the
amount of P429,000. Check no. 464728 was dishonored upon presentment for having been drawn against insufficient funds
while check no. 464743 was not presented for payment upon request of petitioners who promised to replace the dishonored
check.

When petitioners reneged on their promise to cover the amount of check no. 464728, the private respondent filed a
complaint-affidavit before the Office of the City Prosecutor of Quezon City charging petitioner spouses with the crime of
estafa under Article 315, par. 2 (d) of the Revised Penal Code, as amended by PD 818.

On February 16, 2001, the City Prosecutor issued a resolution finding probable cause against petitioners and recommending
the filing of an information for estafa with no bail recommended. On the same day, an information for the crime of estafa
was filed with Branch 217 of the Regional Trial Court of Quezon City against petitioners. The case was docketed as Criminal
Case No. Q-01-101574. Thereafter, the trial court issued a warrant for the arrest of herein petitioners, thus: chan rob1es v irt ual 1aw li bra ry

It appearing on the face of the information and from supporting affidavit of the complaining witness and its annexes that
probable cause exists, that the crime charged was committed and accused is probably guilty thereof, let a warrant for the
arrest of the accused be issued.

No Bail Recommended.

SO ORDERED. 1

On July 18, 2001, petitioners filed an "Urgent Motion to Quash Information and Warrant of Arrest" which was denied by the
trial court. Likewise, petitioners’ motion for bail filed on July 24, 2001 was denied by the trial court on the same day.
Petitioner Jovencio Lim was arrested by virtue of the warrant of arrest issued by the trial court and was detained at the
Quezon City Jail. However, petitioner Teresita Lim remained at large.

On August 22, 2001, petitioners filed the instant petition for certiorari imputing grave abuse of discretion on the part of the
lower court and the Office of the City Prosecutor of Quezon City, arguing that PD 818 violates the constitutional provisions on
due process, bail and imposition of cruel, degrading or inhuman punishment.

In a resolution dated February 26, 2002, this Court granted the petition of Jovencio Lim to post bail pursuant to Department
of Justice Circular No. 74 dated November 6, 2001 which amended the 2000 Bail Bond Guide involving estafa under Article
315, par. 2 (d), and qualified theft. Said Circular specifically provides as follows:
chan rob1e s virt ual 1aw l ibra ry

x x x

3) Where the amount of fraud is P32,000.00 or over in which the imposable penalty is reclusion temporal to reclusion
perpetua, bail shall be based on reclusion temporal maximum, pursuant to Par. 2 (a) of the 2000 Bail Bond Guide, multiplied
by P2,000.00, plus an additional of P2,000.00 for every P10,000.00 in excess of P22,000.00; Provided, however, that the
total amount of bail shall not exceed P60,000.00.

In view of the aforementioned resolution, the matter concerning bail shall no longer be discussed. Thus, this decision will
focus on whether or not PD 818 violates Sections 1 and 19 of Article III of the Constitution, which respectively provide: c han rob1es v irt ual 1aw l ibra ry
Section 1. No person shall be deprived of life, liberty or property without due process of law, nor shall any person be denied
the equal protection of the laws.

x x x

Section 19 (1) Excessive fines shall not be imposed, nor cruel, degrading or inhuman punishment inflicted. . . .

We shall deal first with the issue of whether PD 818 was enacted in contravention of Section 19 of Article III of the
Constitution. In this regard, the impugned provision of PD 818 reads as follows: chanrob 1es vi rtual 1aw lib rary

SECTION 1. Any person who shall defraud another by means of false pretenses or fraudulent acts as defined in paragraph
2(d) of Article 315 of the Revised Penal Code, as amended by Republic Act No. 4885, shall punished by: chan rob1es v irt ual 1aw l ibra ry

1st. The penalty of reclusion temporal if the amount of the fraud is over 12,000 pesos but does not exceed 22,000 pesos,
and if such amount exceeds the later sum, the penalty provided in this paragraph shall be imposed in its maximum period,
adding one year for each additional 10,000 pesos but the total penalty which may be imposed shall in no case exceed thirty
years. In such cases, and in connection with the accessory penalties which may be imposed under the Revised Penal Code,
the penalty shall be termed reclusion perpetua;

2nd. The penalty of prision mayor in its maximum period, if the amount of the fraud is over 6,000 pesos but does not exceed
12,000 pesos.

3rd. The penalty of prision mayor in its medium period, if such amount is over 200 pesos but does not exceed 6,000 pesos;
and

4th. By prision mayor in its minimum period, if such amount does not exceed 200 pesos.

Petitioners contend that, inasmuch as the amount of the subject check is P365,750, they can be penalized with reclusion
perpetua or 30 years of imprisonment. This penalty, according to petitioners, is too severe and disproportionate to the crime
they committed and infringes on the express mandate of Article III, Section 19 of the Constitution which prohibits the
infliction of cruel, degrading and inhuman punishment.

Settled is the rule that a punishment authorized by statute is not cruel, degrading or disproportionate to the nature of the
offense unless it is flagrantly and plainly oppressive and wholly disproportionate to the nature of the offense as to shock the
moral sense of the community. It takes more than merely being harsh, excessive, out of proportion or severe for a penalty to
be obnoxious to the Constitution. 2 Based on this principle, the Court has consistently overruled contentions of the defense
that the penalty of fine or imprisonment authorized by the statute involved is cruel and degrading.

In People v. Tongko, 3 this Court held that the prohibition against cruel and unusual punishment is generally aimed at the
form or character of the punishment rather than its severity in respect of its duration or amount, and applies to punishments
which never existed in America or which public sentiment regards as cruel or obsolete. This refers, for instance, to those
inflicted at the whipping post or in the pillory, to burning at the stake, breaking on the wheel, disemboweling and the like.
The fact that the penalty is severe provides insufficient basis to declare a law unconstitutional and does not, by that
circumstance alone, make it cruel and inhuman.

Petitioners also argue that while PD 818 increased the imposable penalties for estafa committed under Article 315, par. 2 (d)
of the Revised Penal Code, it did not increase the amounts corresponding to the said new penalties. Thus, the original
amounts provided for in the Revised Penal Code have remained the same notwithstanding that they have become negligible
and insignificant compared to the present value of the peso.

This argument is without merit. The primary purpose of PD 818 is emphatically and categorically stated in the following: chan rob1e s virtual 1aw lib rary

WHEREAS, reports received of late indicate an upsurge of estafa (swindling) cases committed by means of bouncing checks;

WHEREAS, if not checked at once, these criminal acts would erode the people’s confidence in the use of negotiable
instruments as a medium of commercial transaction and consequently result in the retardation of trade and commerce and
the undermining of the banking system of the country;

WHEREAS, it is vitally necessary to arrest and curb the rise in this kind of estafa cases by increasing the existing penalties
provided therefor.

Clearly, the increase in the penalty, far from being cruel and degrading, was motivated by a laudable purpose, namely, to
effectuate the repression of an evil that undermines the country’s commercial and economic growth, and to serve as a
necessary precaution to deter people from issuing bouncing checks. The fact that PD 818 did not increase the amounts
corresponding to the new penalties only proves that the amount is immaterial and inconsequential. What the law sought to
avert was the proliferation of estafa cases committed by means of bouncing checks. Taking into account the salutary purpose
for which said law was decreed, we conclude that PD 818 does not violate Section 19 of Article III of the Constitution.

Moreover, when a law is questioned before the Court, the presumption is in favor of its constitutionality. To justify its
nullification, there must be a clear and unmistakable breach of the Constitution, not a doubtful and argumentative one. 4 The
burden of proving the invalidity of a law rests on those who challenge it. In this case, petitioners failed to present clear and
convincing proof to defeat the presumption of constitutionality of PD 818.

With respect to the issue of whether PD 818 infringes on Section 1 of Article III of the Constitution, petitioners claim that PD
818 is violative of the due process clause of the Constitution as it was not published in the Official Gazette. This claim is
incorrect and must be rejected. Publication, being an indispensable part of due process, is imperative to the validity of laws,
presidential decrees and executive orders. 5 PD 818 was published in the Official Gazette on December 1, 1975. 6

With the foregoing considerations in mind, this Court upholds the constitutionality of PD 818. chanrob1es vi rt ua1 1aw 1i bra ry

WHEREFORE, the petition is hereby DISMISSED.

SO ORDERED.

G.R. No. 72873 May 28, 1987

CARLOS ALONZO and CASIMIRA ALONZO, petitioners,

vs.
INTERMEDIATE APPELLATE COURT and TECLA PADUA, respondents.

Perpetuo L.B. Alonzo for petitioners.

Luis R. Reyes for private respondent.

CRUZ, J.:

The question is sometimes asked, in serious inquiry or in curious conjecture, whether we are a court of law or a
court of justice. Do we apply the law even if it is unjust or do we administer justice even against the law? Thus
queried, we do not equivocate. The answer is that we do neither because we are a court both of law and of justice.
We apply the law with justice for that is our mission and purpose in the scheme of our Republic. This case is an
illustration.

Five brothers and sisters inherited in equal pro indiviso shares a parcel of land registered in 'the name of their
deceased parents under OCT No. 10977 of the Registry of Deeds of Tarlac. 1

On March 15, 1963, one of them, Celestino Padua, transferred his undivided share of the herein petitioners for the sum of P550.00 by way of absolute sale. 2 One
year later, on April 22, 1964, Eustaquia Padua, his sister, sold her own share to the same vendees, in an instrument denominated "Con Pacto de Retro Sale," for
the sum of P 440.00. 3

By virtue of such agreements, the petitioners occupied, after the said sales, an area corresponding to two-fifths of
the said lot, representing the portions sold to them. The vendees subsequently enclosed the same with a fence. In
1975, with their consent, their son Eduardo Alonzo and his wife built a semi-concrete house on a part of the
enclosed area.4

On February 25, 1976, Mariano Padua, one of the five coheirs, sought to redeem the area sold to the spouses
Alonzo, but his complaint was dismissed when it appeared that he was an American citizen .5 On May 27, 1977,
however, Tecla Padua, another co-heir, filed her own complaint invoking the same right of redemption claimed by
her brother. 6

The trial court * also dismiss this complaint, now on the ground that the right had lapsed, not having been exercised within thirty days from notice of the sales
7
in 1963 and 1964. Although there was no written notice, it was held that actual knowledge of the sales by the co-heirs satisfied the requirement of the law.

In truth, such actual notice as acquired by the co-heirs cannot be plausibly denied. The other co-heirs, including
Tecla Padua, lived on the same lot, which consisted of only 604 square meters, including the portions sold to the
petitioners . 8 Eustaquia herself, who had sold her portion, was staying in the same house with her sister Tecla, who
later claimed redemption petition. 9 Moreover, the petitioners and the private respondents were close friends and
neighbors whose children went to school together. 10

It is highly improbable that the other co-heirs were unaware of the sales and that they thought, as they alleged, that the area occupied by the petitioners had
merely been mortgaged by Celestino and Eustaquia. In the circumstances just narrated, it was impossible for Tecla not to know that the area occupied by the
petitioners had been purchased by them from the other. co-heirs. Especially significant was the erection thereon of the permanent semi-concrete structure by the
petitioners' son, which was done without objection on her part or of any of the other co-heirs.

The only real question in this case, therefore, is the correct interpretation and application of the pertinent law as
invoked, interestingly enough, by both the petitioners and the private respondents. This is Article 1088 of the Civil
Code, providing as follows:

Art. 1088. Should any of the heirs sell his hereditary rights to a stranger before the partition, any or
all of the co-heirs may be subrogated to the rights of the purchaser by reimbursing him for the price
of the sale, provided they do so within the period of one month from the time they were notified in
writing of the sale by the vendor.

In reversing the trial court, the respondent court ** declared that the notice required by the said article was written notice and that actual notice
would not suffice as a substitute. Citing the same case of De Conejero v. Court of Appeals 11 applied by the trial court, the respondent court held that that
decision, interpreting a like rule in Article 1623, stressed the need for written notice although no particular form was required.

Thus, according to Justice J.B.L. Reyes, who was the ponente of the Court, furnishing the co-heirs with a copy of
the deed of sale of the property subject to redemption would satisfy the requirement for written notice. "So long,
therefore, as the latter (i.e., the redemptioner) is informed in writing of the sale and the particulars thereof," he
declared, "the thirty days for redemption start running. "

In the earlier decision of Butte v. UY, 12 " the Court, speaking through the same learned jurist, emphasized that the written notice should be given
by the vendor and not the vendees, conformably to a similar requirement under Article 1623, reading as follows:

Art. 1623. The right of legal pre-emption or redemption shall not be exercised except within thirty
days from the notice in writing by the prospective vendor, or by the vendors, as the case may be.
The deed of sale shall not be recorded in the Registry of Property, unless accompanied by an
affidavit of the vendor that he has given written notice thereof to all possible redemptioners.

The right of redemption of co-owners excludes that of the adjoining owners.

As "it is thus apparent that the Philippine legislature in Article 1623 deliberately selected a particular method of
giving notice, and that notice must be deemed exclusive," the Court held that notice given by the vendees and not
the vendor would not toll the running of the 30-day period.

The petition before us appears to be an illustration of the Holmes dictum that "hard cases make bad laws" as the
petitioners obviously cannot argue against the fact that there was really no written notice given by the vendors to
their co-heirs. Strictly applied and interpreted, Article 1088 can lead to only one conclusion, to wit, that in view of
such deficiency, the 30 day period for redemption had not begun to run, much less expired in 1977.

But as has also been aptly observed, we test a law by its results; and likewise, we may add, by its purposes. It is a
cardinal rule that, in seeking the meaning of the law, the first concern of the judge should be to discover in its
provisions the in tent of the lawmaker. Unquestionably, the law should never be interpreted in such a way as to
cause injustice as this is never within the legislative intent. An indispensable part of that intent, in fact, for we
presume the good motives of the legislature, is to render justice.

Thus, we interpret and apply the law not independently of but in consonance with justice. Law and justice are
inseparable, and we must keep them so. To be sure, there are some laws that, while generally valid, may seem
arbitrary when applied in a particular case because of its peculiar circumstances. In such a situation, we are not
bound, because only of our nature and functions, to apply them just the same, in slavish obedience to their
language. What we do instead is find a balance between the word and the will, that justice may be done even as the
law is obeyed.

As judges, we are not automatons. We do not and must not unfeelingly apply the law as it is worded, yielding like
robots to the literal command without regard to its cause and consequence. "Courts are apt to err by sticking too
closely to the words of a law," so we are warned, by Justice Holmes again, "where these words import a policy that
goes beyond them." 13 While we admittedly may not legislate, we nevertheless have the power to interpret the law in such a way as to reflect the will of
the legislature. While we may not read into the law a purpose that is not there, we nevertheless have the right to read out of it the reason for its enactment. In
doing so, we defer not to "the letter that killeth" but to "the spirit that vivifieth," to give effect to the law maker's will.

The spirit, rather than the letter of a statute determines its construction, hence, a statute must be
read according to its spirit or intent. For what is within the spirit is within the letter but although it is
not within the letter thereof, and that which is within the letter but not within the spirit is not within the
statute. Stated differently, a thing which is within the intent of the lawmaker is as much within the
statute as if within the letter; and a thing which is within the letter of the statute is not within the
statute unless within the intent of the lawmakers. 14

In requiring written notice, Article 1088 seeks to ensure that the redemptioner is properly notified of the sale and to indicate the date of such
notice as the starting time of the 30-day period of redemption. Considering the shortness of the period, it is really necessary, as a general
rule, to pinpoint the precise date it is supposed to begin, to obviate any problem of alleged delays, sometimes consisting of only a day or two.

The instant case presents no such problem because the right of redemption was invoked not days but years after
the sales were made in 1963 and 1964. The complaint was filed by Tecla Padua in 1977, thirteen years after the
first sale and fourteen years after the second sale. The delay invoked by the petitioners extends to more than a
decade, assuming of course that there was a valid notice that tolled the running of the period of redemption.

Was there a valid notice? Granting that the law requires the notice to be written, would such notice be necessary in
this case? Assuming there was a valid notice although it was not in writing. would there be any question that the 30-
day period for redemption had expired long before the complaint was filed in 1977?

In the face of the established facts, we cannot accept the private respondents' pretense that they were unaware of
the sales made by their brother and sister in 1963 and 1964. By requiring written proof of such notice, we would be
closing our eyes to the obvious truth in favor of their palpably false claim of ignorance, thus exalting the letter of the
law over its purpose. The purpose is clear enough: to make sure that the redemptioners are duly notified. We are
satisfied that in this case the other brothers and sisters were actually informed, although not in writing, of the sales
made in 1963 and 1964, and that such notice was sufficient.

Now, when did the 30-day period of redemption begin?

While we do not here declare that this period started from the dates of such sales in 1963 and 1964, we do say that
sometime between those years and 1976, when the first complaint for redemption was filed, the other co-heirs were
actually informed of the sale and that thereafter the 30-day period started running and ultimately expired. This could
have happened any time during the interval of thirteen years, when none of the co-heirs made a move to redeem
the properties sold. By 1977, in other words, when Tecla Padua filed her complaint, the right of redemption had
already been extinguished because the period for its exercise had already expired.

The following doctrine is also worth noting:

While the general rule is, that to charge a party with laches in the assertion of an alleged right it is
essential that he should have knowledge of the facts upon which he bases his claim, yet if the
circumstances were such as should have induced inquiry, and the means of ascertaining the truth
were readily available upon inquiry, but the party neglects to make it, he will be chargeable with
laches, the same as if he had known the facts. 15

It was the perfectly natural thing for the co-heirs to wonder why the spouses Alonzo, who were not among them, should enclose a portion of the inherited lot and
build thereon a house of strong materials. This definitely was not the act of a temporary possessor or a mere mortgagee. This certainly looked like an act of
ownership. Yet, given this unseemly situation, none of the co-heirs saw fit to object or at least inquire, to ascertain the facts, which were readily available. It took all
of thirteen years before one of them chose to claim the right of redemption, but then it was already too late.

We realize that in arriving at our conclusion today, we are deviating from the strict letter of the law, which the
respondent court understandably applied pursuant to existing jurisprudence. The said court acted properly as it had
no competence to reverse the doctrines laid down by this Court in the above-cited cases. In fact, and this should be
clearly stressed, we ourselves are not abandoning the De Conejero and Buttle doctrines. What we are doing simply
is adopting an exception to the general rule, in view of the peculiar circumstances of this case.

The co-heirs in this case were undeniably informed of the sales although no notice in writing was given them. And
there is no doubt either that the 30-day period began and ended during the 14 years between the sales in question
and the filing of the complaint for redemption in 1977, without the co-heirs exercising their right of redemption.
These are the justifications for this exception.

More than twenty centuries ago, Justinian defined justice "as the constant and perpetual wish to render every one
his due." 16 That wish continues to motivate this Court when it assesses the facts and the law in every case brought to it for decision. Justice is always an
essential ingredient of its decisions. Thus when the facts warrants, we interpret the law in a way that will render justice, presuming that it was the intention of the
lawmaker, to begin with, that the law be dispensed with justice. So we have done in this case.

WHEREFORE, the petition is granted. The decision of the respondent court is REVERSED and that of the trial court
is reinstated, without any pronouncement as to costs. It is so ordered.

G.R. No. 94723 August 21, 1997

KAREN E. SALVACION, minor, thru Federico N. Salvacion, Jr., father and Natural Guardian, and Spouses
FEDERICO N. SALVACION, JR., and EVELINA E. SALVACION, petitioners,
vs.
CENTRAL BANK OF THE PHILIPPINES, CHINA BANKING CORPORATION and GREG BARTELLI y
NORTHCOTT, respondents.

TORRES, JR., J.:

In our predisposition to discover the "original intent" of a statute, courts become the unfeeling pillars of the status
quo. Ligle do we realize that statutes or even constitutions are bundles of compromises thrown our way by their
framers. Unless we exercise vigilance, the statute may already be out of tune and irrelevant to our day.

The petition is for declaratory relief. It prays for the following reliefs:

a.) Immediately upon the filing of this petition, an Order be issued restraining the respondents from
applying and enforcing Section 113 of Central Bank Circular No. 960;

b.) After hearing, judgment be rendered:

1.) Declaring the respective rights and duties of petitioners and respondents;

2.) Adjudging Section 113 of Central Bank Circular No. 960 as contrary to the provisions of the
Constitution, hence void; because its provision that "Foreign currency deposits shall be exempt from
attachment, garnishment, or any other order or process of any court, legislative body, government
agency or any administrative body whatsoever
 i.) has taken away the right of petitioners to have the bank deposit of defendant Greg
Bartelli y Northcott garnished to satisfy the judgment rendered in petitioners' favor in
violation of substantive due process guaranteed by the Constitution;

ii.) has given foreign currency depositors an undue favor or a class privilege in
violation of the equal protection clause of the Constitution;

iii.) has provided a safe haven for criminals like the herein respondent Greg Bartelli y
Northcott since criminals could escape civil liability for their wrongful acts by merely
converting their money to a foreign currency and depositing it in a foreign currency
deposit account with an authorized bank.

The antecedent facts:

On February 4, 1989, Greg Bartelli y Northcott, an American tourist, coaxed and lured petitioner Karen Salvacion,
then 12 years old to go with him to his apartment. Therein, Greg Bartelli detained Karen Salvacion for four days, or
up to February 7, 1989 and was able to rape the child once on February 4, and three times each day on February 5,
6, and 7, 1989. On February 7, 1989, after policemen and people living nearby, rescued Karen, Greg Bartelli was
arrested and detained at the Makati Municipal Jail. The policemen recovered from Bartelli the following items: 1.)
Dollar Check No. 368, Control No. 021000678-1166111303, US 3,903.20; 2.) COCOBANK Bank Book No. 104-
108758-8 (Peso Acct.); 3.) Dollar Account — China Banking Corp., US$/A#54105028-2; 4.) ID-122-30-8877; 5.)
Philippine Money (P234.00) cash; 6.) Door Keys 6 pieces; 7.) Stuffed Doll (Teddy Bear) used in seducing the
complainant.

On February 16, 1989, Makati Investigating Fiscal Edwin G. Condaya filed against Greg Bartelli, Criminal Case No.
801 for Serious Illegal Detention and Criminal Cases Nos. 802, 803, 804, and 805 for four (4) counts of Rape. On
the same day, petitioners filed with the Regional Trial Court of Makati Civil Case No. 89-3214 for damages with
preliminary attachment against Greg Bartelli. On February 24, 1989, the day there was a scheduled hearing for
Bartelli's petition for bail the latter escaped from jail.

On February 28, 1989, the court granted the fiscal's Urgent Ex-Parte Motion for the Issuance of Warrant of Arrest
and Hold Departure Order. Pending the arrest of the accused Greg Bartelli y Northcott, the criminal cases were
archived in an Order dated February 28, 1989.

Meanwhile, in Civil Case No. 89-3214, the Judge issued an Order dated February 22, 1989 granting the application
of herein petitioners, for the issuance of the writ of preliminary attachment. After petitioners gave Bond No. JCL (4)
1981 by FGU Insurance Corporation in the amount of P100,000.00, a Writ of Preliminary Attachment was issued by
the trial court on February 28, 1989.

On March 1, 1989, the Deputy Sheriff of Makati served a Notice of Garnishment on China Banking Corporation. In a
letter dated March 13, 1989 to the Deputy Sheriff of Makati, China Banking Corporation invoked Republic Act No.
1405 as its answer to the notice of garnishment served on it. On March 15, 1989, Deputy Sheriff of Makati Armando
de Guzman sent his reply to China Banking Corporation saying that the garnishment did not violate the secrecy of
bank deposits since the disclosure is merely incidental to a garnishment properly and legally made by virtue of a
court order which has placed the subject deposits in custodia legis. In answer to this letter of the Deputy Sheriff of
Makati, China Banking Corporation, in a letter dated March 20, 1989, invoked Section 113 of Central Bank Circular
No. 960 to the effect that the dollar deposits or defendant Greg Bartelli are exempt from attachment, garnishment, or
any other order or process of any court, legislative body, government agency or any administrative body,
whatsoever.

This prompted the counsel for petitioners to make an inquiry with the Central Bank in a letter dated April 25, 1989 on
whether Section 113 of CB Circular No. 960 has any exception or whether said section has been repealed or
amended since said section has rendered nugatory the substantive right of the plaintiff to have the claim sought to
be enforced by the civil action secured by way of the writ of preliminary attachment as granted to the plaintiff under
Rule 57 of the Revised Rules of Court. The Central Bank responded as follows:

May 26, 1989

Ms. Erlinda S. Carolino

12 Pres. Osmena Avenue
South Admiral Village
Paranaque, Metro Manila

Dear Ms. Carolino:

This is in reply to your letter dated April 25, 1989 regarding your inquiry on Section 113, CB Circular
No. 960 (1983).
 The cited provision is absolute in application. It does not admit of any exception, nor has the same
been repealed nor amended.

The purpose of the law is to encourage dollar accounts within the country's banking system which
would help in the development of the economy. There is no intention to render futile the basic rights
of a person as was suggested in your subject letter. The law may be harsh as some perceive it, but it
is still the law. Compliance is, therefore, enjoined.

Very truly yours,

(SGD) AGAPITO S. FAJARDO

Director1

Meanwhile, on April 10, 1989, the trial court granted petitioners' motion for leave to serve summons by publication in
the Civil Case No. 89-3214 entitled "Karen Salvacion, et al. vs. Greg Bartelli y Northcott." Summons with the
complaint was a published in the Manila Times once a week for three consecutive weeks. Greg Bartelli failed to file
his answer to the complaint and was declared in default on August 7, 1989. After hearing the case ex-parte, the
court rendered judgment in favor of petitioners on March 29, 1990, the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered in favor of plaintiffs and against defendant, ordering the
latter:

1. To pay plaintiff Karen E. Salvacion the amount of P500,000.00 as moral damages;

2. To pay her parents, plaintiffs spouses Federico N. Salvacion, Jr., and Evelina E. Salvacion the
amount of P150,000.00 each or a total of P300,000.00 for both of them;

3. To pay plaintiffs exemplary damages of P100,000.00; and

4. To pay attorney's fees in an amount equivalent to 25% of the total amount of damages herein
awarded;

5. To pay litigation expenses of P10,000.00; plus

6. Costs of the suit.

SO ORDERED.

The heinous acts of respondent Greg Bartelli which gave rise to the award were related in graphic detail by the trial
court in its decision as follows:

The defendant in this case was originally detained in the municipal jail of Makati but was able to
escape therefrom on February 24, 1989 as per report of the Jail Warden of Makati to the Presiding
Judge, Honorable Manuel M. Cosico of the Regional Trial Court of Makati, Branch 136, where he
was charged with four counts of Rape and Serious Illegal Detention (Crim. Cases Nos. 802 to 805).
Accordingly, upon motion of plaintiffs, through counsel, summons was served upon defendant by
publication in the Manila Times, a newspaper of general circulation as attested by the Advertising
Manager of the Metro Media Times, Inc., the publisher of the said newspaper. Defendant, however,
failed to file his answer to the complaint despite the lapse of the period of sixty (60) days from the
last publication; hence, upon motion of the plaintiffs, through counsel, defendant was declared in
default and plaintiffs were authorized to present their evidence ex parte.

In support of the complaint, plaintiffs presented as witnesses the minor Karen E. Salvacion, her
father, Federico N. Salvacion, Jr., a certain Joseph Aguilar and a certain Liberato Madulio, who gave
the following testimony:

Karen took her first year high school in St. Mary's Academy in Pasay City but has recently
transferred to Arellano University for her second year.

In the afternoon of February 4, 1989, Karen was at the Plaza Fair Makati Cinema Square, with her
friend Edna Tangile whiling away her free time. At about 3:30 p.m. while she was finishing her snack
on a concrete bench in front of Plaza Fair, an American approached her. She was then alone
because Edna Tangile had already left, and she was about to go home. (TSN, Aug. 15, 1989, pp. 2
to 5)

The American asked her name and introduced himself as Greg Bartelli. He sat beside her when he
talked to her. He said he was a Math teacher and told her that he has a sister who is a nurse in New
York. His sister allegedly has a daughter who is about Karen's age and who was with him in his
house along Kalayaan Avenue. (TSN, Aug. 15, 1989, pp. 4-5)

The American asked Karen what was her favorite subject and she told him it's Pilipino. He then
invited her to go with him to his house where she could teach Pilipino to his niece. He even gave her
a stuffed toy to persuade her to teach his niece. (Id., pp. 5-6)

They walked from Plaza Fair along Pasong Tamo, turning right to reach the defendant's house along
Kalayaan Avenue. (Id., p. 6)

When they reached the apartment house, Karen noticed that defendant's alleged niece was not
outside the house but defendant told her maybe his niece was inside. When Karen did not see the
alleged niece inside the house, defendant told her maybe his niece was upstairs, and invited Karen
to go upstairs. (Id., p. 7)

Upon entering the bedroom defendant suddenly locked the door. Karen became nervous because
his niece was not there. Defendant got a piece of cotton cord and tied Karen's hands with it, and
then he undressed her. Karen cried for help but defendant strangled her. He took a packing tape and
he covered her mouth with it and he circled it around her head. (Id., p. 7)

Then, defendant suddenly pushed Karen towards the bed which was just near the door. He tied her
feet and hands spread apart to the bed posts. He knelt in front of her and inserted his finger in her
sex organ. She felt severe pain. She tried to shout but no sound could come out because there were
tapes on her mouth. When defendant withdrew his finger it was full of blood and Karen felt more pain
after the withdrawal of the finger. (Id., p. 8)

He then got a Johnson's Baby Oil and he applied it to his sex organ as well as to her sex organ.
After that he forced his sex organ into her but he was not able to do so. While he was doing it, Karen
found it difficult to breathe and she perspired a lot while feeling severe pain. She merely presumed
that he was able to insert his sex organ a little, because she could not see. Karen could not recall
how long the defendant was in that position. (Id. pp. 8-9)

After that, he stood up and went to the bathroom to wash. He also told Karen to take a shower and
he untied her hands. Karen could only hear the sound of the water while the defendant, she
presumed, was in the bathroom washing his sex organ. When she took a shower more blood came
out from her. In the meantime, defendant changed the mattress because it was full of blood. After
the shower, Karen was allowed by defendant to sleep. She fell asleep because she got tired crying.
The incident happened at about 4:00 p.m. Karen had no way of determining the exact time because
defendant removed her watch. Defendant did not care to give her food before she went to sleep.
Karen woke up at about 8:00 o'clock the following morning. (Id., pp. 9-10)

The following day, February 5, 1989, a Sunday, after a breakfast of biscuit and coke at about 8:30 to
9:00 a.m. defendant raped Karen while she was still bleeding. For lunch, they also took biscuit and
coke. She was raped for the second time at about 12:00 to 2:00 p.m. In the evening, they had rice
for dinner which defendant had stored downstairs; it was he who cooked the rice that is why it looks
like "lugaw". For the third time, Karen was raped again during the night. During those three times
defendant succeeded in inserting his sex organ but she could not say whether the organ was
inserted wholly.

Karen did not see any firearm or any bladed weapon. The defendant did not tie her hands and feet
nor put a tape on her mouth anymore but she did not cry for help for fear that she might be killed;
besides, all the windows and doors were closed. And even if she shouted for help, nobody would
hear her. She was so afraid that if somebody would hear her and would be able to call the police, it
was still possible that as she was still inside the house, defendant might kill her. Besides, the
defendant did not leave that Sunday, ruling out her chance to call for help. At nighttime he slept with
her again. (TSN, Aug. 15, 1989, pp. 12-14)

On February 6, 1989, Monday, Karen was raped three times, once in the morning for thirty minutes
after a breakfast of biscuits; again in the afternoon; and again in the evening. At first, Karen did not
know that there was a window because everything was covered by a carpet, until defendant opened
the window for around fifteen minutes or less to let some air in, and she found that the window was
covered by styrofoam and plywood. After that, he again closed the window with a hammer and he
put the styrofoam, plywood, and carpet back. (Id., pp. 14-15)

That Monday evening, Karen had a chance to call for help, although defendant left but kept the door
closed. She went to the bathroom and saw a small window covered by styrofoam and she also
spotted a small hole. She stepped on the bowl and she cried for help through the hole. She cried:
"Maawa no po kayo so akin. Tulungan n'yo akong makalabas dito. Kinidnap ako!" Somebody heard
her. It was a woman, probably a neighbor, but she got angry and said she was "istorbo". Karen
 pleaded for help and the woman told her to sleep and she will call the police. She finally fell asleep
but no policeman came. (TSN, Aug. 15, 1989, pp. 15-16)

She woke up at 6:00 o'clock the following morning, and she saw defendant in bed, this time
sleeping. She waited for him to wake up. When he woke up, he again got some food but he always
kept the door locked. As usual, she was merely fed with biscuit and coke. On that day, February 7,
1989, she was again raped three times. The first at about 6:30 to 7:00 a.m., the second at about
8:30 — 9:00, and the third was after lunch at 12:00 noon. After he had raped her for the second time
he left but only for a short while. Upon his return, he caught her shouting for help but he did not
understand what she was shouting about. After she was raped the third time, he left the house.
(TSN, Aug. 15, 1989, pp. 16-17) She again went to the bathroom and shouted for help. After
shouting for about five minutes, she heard many voices. The voices were asking for her name and
she gave her name as Karen Salvacion. After a while, she heard a voice of a woman saying they will
just call the police. They were also telling her to change her clothes. She went from the bathroom to
the room but she did not change her clothes being afraid that should the neighbors call for the police
and the defendant see her in different clothes, he might kill her. At that time she was wearing a T-
shirt of the American because the latter washed her dress. (Id., p. 16)

Afterwards, defendant arrived and he opened the door. He asked her if she had asked for help
because there were many policemen outside and she denied it. He told her to change her clothes,
and she did change to the one she was wearing on Saturday. He instructed her to tell the police that
she left home and willingly; then he went downstairs but he locked the door. She could hear people
conversing but she could not understand what they were saying. (Id., p. 19)

When she heard the voices of many people who were conversing downstairs, she knocked
repeatedly at the door as hard as she could. She heard somebody going upstairs and when the door
was opened, she saw a policeman. The policeman asked her name and the reason why she was
there. She told him she was kidnapped. Downstairs, he saw about five policemen in uniform and the
defendant was talking to them. "Nakikipag-areglo po sa mga pulis," Karen added. "The policeman
told him to just explain at the precinct. (Id., p. 20)

They went out of the house and she saw some of her neighbors in front of the house. They rode the
car of a certain person she called Kuya Boy together with defendant, the policeman, and two of her
neighbors whom she called Kuya Bong Lacson and one Ate Nita. They were brought to Sub-Station
I and there she was investigated by a policeman. At about 2:00 a.m., her father arrived, followed by
her mother together with some of their neighbors. Then they were brought to the second floor of the
police headquarters. (Id., p. 21)

At the headquarters, she was asked several questions by the investigator. The written statement she
gave to the police was marked as Exhibit A. Then they proceeded to the National Bureau of
Investigation together with the investigator and her parents. At the NBI, a doctor, a medico-legal
officer, examined her private parts. It was already 3:00 in the early morning of the following day
when they reached the NBI. (TSN, Aug. 15, 1989, p. 22) The findings of the medico-legal officer has
been marked as Exhibit B.

She was studying at the St. Mary's Academy in Pasay City at the time of the incident but she
subsequently transferred to Apolinario Mabini, Arellano University, situated along Taft Avenue,
because she was ashamed to be the subject of conversation in the school. She first applied for
transfer to Jose Abad Santos, Arellano University along Taft Avenue near the Light Rail Transit
Station but she was denied admission after she told the school the true reason for her transfer. The
reason for their denial was that they might be implicated in the case. (TSN, Aug. 15, 1989, p. 46)

xxx xxx xxx

After the incident, Karen has changed a lot. She does not play with her brother and sister anymore,
and she is always in a state of shock; she has been absent-minded and is ashamed even to go out
of the house. (TSN, Sept. 12, 1989, p. 10) She appears to be restless or sad, (Id., p. 11) The father
prays for P500,000.00 moral damages for Karen for this shocking experience which probably, she
would always recall until she reaches old age, and he is not sure if she could ever recover from this
experience. (TSN, Sept. 24, 1989, pp. 10-11)

Pursuant to an Order granting leave to publish notice of decision, said notice was published in the Manila Bulletin
once a week for three consecutive weeks. After the lapse of fifteen (15) days from the date of the last publication of
the notice of judgment and the decision of the trial court had become final, petitioners tried to execute on Bartelli's
dollar deposit with China Banking Corporation. Likewise, the bank invoked Section 113 of Central Bank Circular No.
960.

Thus, petitioners decided to seek relief from this Court.

The issues raised and the arguments articulated by the parties boil down to two:

May this Court entertain the instant petition despite the fact that original jurisdiction in petitions for declaratory relief
rests with the lower court? Should Section 113 of Central Bank Circular No. 960 and Section 8 of R.A. 6426, as
amended by P.D. 1246, otherwise known as the Foreign Currency Deposit Act be made applicable to a foreign
transient?

Petitioners aver as heretofore stated that Section 113 of Central Bank Circular No. 960 providing that "Foreign
currency deposits shall be exempt from attachment, garnishment, or any other order or process of any court,
legislative body, government agency or any administrative body whatsoever." should be adjudged as
unconstitutional on the grounds that: 1.) it has taken away the right of petitioners to have the bank deposit of
defendant Greg Bartelli y Northcott garnished to satisfy the judgment rendered in petitioners' favor in violation of
substantive due process guaranteed by the Constitution; 2.) it has given foreign currency depositors an undue favor
or a class privilege in violation of the equal protection clause of the Constitution; 3.) it has provided a safe haven for
criminals like the herein respondent Greg Bartelli y Northcott since criminals could escape civil liability for their
wrongful acts by merely converting their money to a foreign currency and depositing it in a foreign currency deposit
account with an authorized bank; and 4.) The Monetary Board, in issuing Section 113 of Central Bank Circular No.
960 has exceeded its delegated quasi-legislative power when it took away: a.) the plaintiffs substantive right to have
the claim sought to be enforced by the civil action secured by way of the writ of preliminary attachment as granted
by Rule 57 of the Revised Rules of Court; b.) the plaintiffs substantive right to have the judgment credit satisfied by
way of the writ of execution out of the bank deposit of the judgment debtor as granted to the judgment creditor by
Rule 39 of the Revised Rules of Court, which is beyond its power to do so.

On the other hand, respondent Central Bank, in its Comment alleges that the Monetary Board in issuing Section 113
of CB Circular No. 960 did not exceed its power or authority because the subject Section is copied verbatim from a
portion of R.A. No. 6426 as amended by P.D. 1246. Hence, it was not the Monetary Board that grants exemption
from attachment or garnishment to foreign currency deposits, but the law (R.A. 6426 as amended) itself; that it does
not violate the substantive due process guaranteed by the Constitution because a.) it was based on a law; b.) the
law seems to be reasonable; c.) it is enforced according to regular methods of procedure; and d.) it applies to all
members of a class.

Expanding, the Central Bank said; that one reason for exempting the foreign currency deposits from attachment,
garnishment or any other order or process of any court, is to assure the development and speedy growth of the
Foreign Currency Deposit System and the Offshore Banking System in the Philippines; that another reason is to
encourage the inflow of foreign currency deposits into the banking institutions thereby placing such institutions more
in a position to properly channel the same to loans and investments in the Philippines, thus directly contributing to
the economic development of the country; that the subject section is being enforced according to the regular
methods of procedure; and that it applies to all foreign currency deposits made by any person and therefore does
not violate the equal protection clause of the Constitution.

Respondent Central Bank further avers that the questioned provision is needed to promote the public interest and
the general welfare; that the State cannot just stand idly by while a considerable segment of the society suffers from
economic distress; that the State had to take some measures to encourage economic development; and that in so
doing persons and property may be subjected to some kinds of restraints or burdens to secure the general welfare
or public interest. Respondent Central Bank also alleges that Rule 39 and Rule 57 of the Revised Rules of Court
provide that some properties are exempted from execution/attachment especially provided by law and R.A. No.
6426 as amended is such a law, in that it specifically provides, among others, that foreign currency deposits shall be
exempted from attachment, garnishment, or any other order or process of any court, legislative body, government
agency or any administrative body whatsoever.

For its part, respondent China Banking Corporation, aside from giving reasons similar to that of respondent Central
Bank, also stated that respondent China Bank is not unmindful of the inhuman sufferings experienced by the minor
Karen E. Salvacion from the beastly hands of Greg Bartelli; that it is only too willing to release the dollar deposit of
Bartelli which may perhaps partly mitigate the sufferings petitioner has undergone; but it is restrained from doing so
in view of R.A. No. 6426 and Section 113 of Central Bank Circular No. 960; and that despite the harsh effect of
these laws on petitioners, CBC has no other alternative but to follow the same.

This Court finds the petition to be partly meritorious.

Petitioner deserves to receive the damages awarded to her by the court. But this petition for declaratory relief can
only be entertained and treated as a petition for mandamus to require respondents to honor and comply with the writ
of execution in Civil Case No. 89-3214.

This Court has no original and exclusive jurisdiction over a petition for declaratory relief.2 However, exceptions to
this rule have been recognized. Thus, where the petition has far-reaching implications and raises questions that
should be resolved, it may be treated as one for mandamus.3

Here is a child, a 12-year old girl, who in her belief that all Americans are good and in her gesture of kindness by
teaching his alleged niece the Filipino language as requested by the American, trustingly went with said stranger to
his apartment, and there she was raped by said American tourist Greg Bartelli. Not once, but ten times. She was
detained therein for four (4) days. This American tourist was able to escape from the jail and avoid punishment. On
the other hand, the child, having received a favorable judgment in the Civil Case for damages in the amount of more
than P1,000,000.00, which amount could alleviate the humiliation, anxiety, and besmirched reputation she had
suffered and may continue to suffer for a long, long time; and knowing that this person who had wronged her has
the money, could not, however get the award of damages because of this unreasonable law. This questioned law,
therefore makes futile the favorable judgment and award of damages that she and her parents fully deserve. As
stated by the trial court in its decision,

Indeed, after hearing the testimony of Karen, the Court believes that it was undoubtedly a shocking
and traumatic experience she had undergone which could haunt her mind for a long, long time, the
mere recall of which could make her feel so humiliated, as in fact she had been actually humiliated
once when she was refused admission at the Abad Santos High School, Arellano University, where
she sought to transfer from another school, simply because the school authorities of the said High
School learned about what happened to her and allegedly feared that they might be implicated in the
case.

xxx xxx xxx

The reason for imposing exemplary or corrective damages is due to the wanton and bestial manner
defendant had committed the acts of rape during a period of serious illegal detention of his hapless
victim, the minor Karen Salvacion whose only fault was in her being so naive and credulous to
believe easily that defendant, an American national, could not have such a bestial desire on her nor
capable of committing such a heinous crime. Being only 12 years old when that unfortunate incident
happened, she has never heard of an old Filipino adage that in every forest there is a
snake, . . . .4

If Karen's sad fate had happened to anybody's own kin, it would be difficult for him to fathom how the incentive for
foreign currency deposit could be more important than his child's rights to said award of damages; in this case, the
victim's claim for damages from this alien who had the gall to wrong a child of tender years of a country where he is
a mere visitor. This further illustrates the flaw in the questioned provisions.

It is worth mentioning that R.A. No. 6426 was enacted in 1983 or at a time when the country's economy was in a
shambles; when foreign investments were minimal and presumably, this was the reason why said statute was
enacted. But the realities of the present times show that the country has recovered economically; and even if not,
the questioned law still denies those entitled to due process of law for being unreasonable and oppressive. The
intention of the questioned law may be good when enacted. The law failed to anticipate the iniquitous effects
producing outright injustice and inequality such as the case before us.

It has thus been said that —

But I also know,5 that laws and institutions must go hand in hand with the progress of the human
mind. As that becomes more developed, more enlightened, as new discoveries are made, new
truths are disclosed and manners and opinions change with the change of circumstances,
institutions must advance also, and keep pace with the times. . . We might as well require a man to
wear still the coat which fitted him when a boy, as civilized society to remain ever under the regimen
of their barbarous ancestors.

In his Comment, the Solicitor General correctly opined, thus:

The present petition has far-reaching implications on the right of a national to obtain redress for a
wrong committed by an alien who takes refuge under a law and regulation promulgated for a
purpose which does not contemplate the application thereof envisaged by the alien. More
specifically, the petition raises the question whether the protection against attachment, garnishment
or other court process accorded to foreign currency deposits by PD No. 1246 and CB Circular No.
960 applies when the deposit does not come from a lender or investor but from a mere transient or
tourist who is not expected to maintain the deposit in the bank for long.

The resolution of this question is important for the protection of nationals who are victimized in the
forum by foreigners who are merely passing through.

xxx xxx xxx

. . . Respondents China Banking Corporation and Central Bank of the Philippines refused to honor
the writ of execution issued in Civil Case No. 89-3214 on the strength of the following provision of
Central Bank Circular No. 960:
 Sec. 113. Exemption from attachment. — Foreign currency deposits shall be exempt
from attachment, garnishment, or any other order or process of any court, legislative
body, government agency or any administrative body whatsoever.

Central Bank Circular No. 960 was issued pursuant to Section 7 of Republic Act No. 6426:

Sec. 7. Rules and Regulations. The Monetary Board of the Central Bank shall
promulgate such rules and regulations as may be necessary to carry out the
provisions of this Act which shall take effect after the publication of such rules and
regulations in the Official Gazette and in a newspaper of national circulation for at
least once a week for three consecutive weeks. In case the Central Bank
promulgates new rules and regulations decreasing the rights of depositors, the rules
and regulations at the time the deposit was made shall govern.

The aforecited Section 113 was copied from Section 8 of Republic Act NO. 6426, as amended by
P.D. 1246, thus:

Sec. 8. Secrecy of Foreign Currency Deposits. — All foreign currency deposits

authorized under this Act, as amended by Presidential Decree No. 1035, as well as
foreign currency deposits authorized under Presidential Decree No. 1034, are hereby
declared as and considered of an absolutely confidential nature and, except upon the
written permission of the depositor, in no instance shall such foreign currency
deposits be examined, inquired or looked into by any person, government official,
bureau or office whether judicial or administrative or legislative or any other entity
whether public or private: Provided, however, that said foreign currency deposits
shall be exempt from attachment, garnishment, or any other order or process of any
court, legislative body, government agency or any administrative body whatsoever.

The purpose of PD 1246 in according protection against attachment, garnishment and other court
process to foreign currency deposits is stated in its whereases, viz.:

WHEREAS, under Republic Act No. 6426, as amended by Presidential Decree No.
1035, certain Philippine banking institutions and branches of foreign banks are
authorized to accept deposits in foreign currency;

WHEREAS, under the provisions of Presidential Decree No. 1034 authorizing the
establishment of an offshore banking system in the Philippines, offshore banking
units are also authorized to receive foreign currency deposits in certain cases;

WHEREAS, in order to assure the development and speedy growth of the Foreign
Currency Deposit System and the Offshore Banking System in the Philippines,
certain incentives were provided for under the two Systems such as confidentiality of
deposits subject to certain exceptions and tax exemptions on the interest income of
depositors who are nonresidents and are not engaged in trade or business in the
Philippines;

WHEREAS, making absolute the protective cloak of confidentiality over such foreign
currency deposits, exempting such deposits from tax, and guaranteeing the vested
rights of depositors would better encourage the inflow of foreign currency deposits
into the banking institutions authorized to accept such deposits in the Philippines
thereby placing such institutions more in a position to properly channel the same to
loans and investments in the Philippines, thus directly contributing to the economic
development of the country;

Thus, one of the principal purposes of the protection accorded to foreign currency deposits is "to
assure the development and speedy growth of the Foreign Currency Deposit system and the
Offshore Banking in the Philippines" (3rd Whereas).

The Offshore Banking System was established by PD No. 1034. In turn, the purposes of PD No.
1034 are as follows:

WHEREAS, conditions conducive to the establishment of an offshore banking

system, such as political stability, a growing economy and adequate communication
facilities, among others, exist in the Philippines;

WHEREAS, it is in the interest of developing countries to have as wide access as

possible to the sources of capital funds for economic development;
 WHEREAS, an offshore banking system based in the Philippines will be
advantageous and beneficial to the country by increasing our links with foreign
lenders, facilitating the flow of desired investments into the Philippines, creating
employment opportunities and expertise in international finance, and contributing to
the national development effort.

WHEREAS, the geographical location, physical and human resources, and other
positive factors provide the Philippines with the clear potential to develop as another
financial center in Asia;

On the other hand, the Foreign Currency Deposit system was created by PD. No. 1035. Its purposes
are as follows:

WHEREAS, the establishment of an offshore banking system in the Philippines has

been authorized under a separate decree;

WHEREAS, a number of local commercial banks, as depository bank under the

Foreign Currency Deposit Act (RA No. 6426), have the resources and managerial
competence to more actively engage in foreign exchange transactions and
participate in the grant of foreign currency loans to resident corporations and firms;

WHEREAS, it is timely to expand the foreign currency lending authority of the said
depository banks under RA 6426 and apply to their transactions the same taxes as
would be applicable to transaction of the proposed offshore banking units;

It is evident from the above [Whereas clauses] that the Offshore Banking System and the Foreign
Currency Deposit System were designed to draw deposits from foreign lenders and investors (Vide
second Whereas of PD No. 1034; third Whereas of PD No. 1035). It is these deposits that are
induced by the two laws and given protection and incentives by them.

Obviously, the foreign currency deposit made by a transient or a tourist is not the kind of deposit
encouraged by PD Nos. 1034 and 1035 and given incentives and protection by said laws because
such depositor stays only for a few days in the country and, therefore, will maintain his deposit in the
bank only for a short time.

Respondent Greg Bartelli, as stated, is just a tourist or a transient. He deposited his dollars with
respondent China Banking Corporation only for safekeeping during his temporary stay in the
Philippines.

For the reasons stated above, the Solicitor General thus submits that the dollar deposit of
respondent Greg Bartelli is not entitled to the protection of Section 113 of Central Bank Circular No.
960 and PD No. 1246 against attachment, garnishment or other court processes.6

In fine, the application of the law depends on the extent of its justice. Eventually, if we rule that the questioned
Section 113 of Central Bank Circular No. 960 which exempts from attachment, garnishment, or any other order or
process of any court, legislative body, government agency or any administrative body whatsoever, is applicable to a
foreign transient, injustice would result especially to a citizen aggrieved by a foreign guest like accused Greg
Bartelli. This would negate Article 10 of the New Civil Code which provides that "in case of doubt in the
interpretation or application of laws, it is presumed that the lawmaking body intended right and justice to prevail.
"Ninguno non deue enriquecerse tortizeramente con dano de otro." Simply stated, when the statute is silent or
ambiguous, this is one of those fundamental solutions that would respond to the vehement urge of conscience.
(Padilla vs. Padilla, 74 Phil. 377).

It would be unthinkable, that the questioned Section 113 of Central Bank No. 960 would be used as a device by
accused Greg Bartelli for wrongdoing, and in so doing, acquitting the guilty at the expense of the innocent.

Call it what it may — but is there no conflict of legal policy here? Dollar against Peso? Upholding the final and
executory judgment of the lower court against the Central Bank Circular protecting the foreign depositor? Shielding
or protecting the dollar deposit of a transient alien depositor against injustice to a national and victim of a crime?
This situation calls for fairness against legal tyranny.

We definitely cannot have both ways and rest in the belief that we have served the ends of justice.

IN VIEW WHEREOF, the provisions of Section 113 of CB Circular No. 960 and PD No. 1246, insofar as it amends
Section 8 of R.A. No. 6426 are hereby held to be INAPPLICABLE to this case because of its peculiar
circumstances. Respondents are hereby REQUIRED to COMPLY with the writ of execution issued in Civil Case No.
89-3214, "Karen Salvacion, et al. vs. Greg Bartelli y Northcott, by Branch CXLIV, RTC Makati and to RELEASE to
petitioners the dollar deposit of respondent Greg Bartelli y Northcott in such amount as would satisfy the judgment.
SO ORDERED.

G.R. No. L-630 November 15, 1947

ALEXANDER A. KRIVENKO, petitioner-appellant,

vs.
THE REGISTER OF DEEDS, CITY OF MANILA, respondent and appellee.

Gibbs, Gibbs, Chuidian and Quasha of petitioner-appellant.

First Assistant Solicitor General Reyes and Solicitor Carreon for respondent-appellee.
Marcelino Lontok appeared as amicus curies.

MORAN, C.J.:

Alenxander A. Kriventor alien, bought a residential lot from the Magdalena Estate, Inc., in December of 1941, the
registration of which was interrupted by the war. In May, 1945, he sought to accomplish said registration but was
denied by the register of deeds of Manila on the ground that, being an alien, he cannot acquire land in this
jurisdiction. Krivenko then brought the case to the fourth branch of the Court of First Instance of Manila by means of
a consulta, and that court rendered judgment sustaining the refusal of the register of deeds, from which Krivenko
appealed to this Court.

There is no dispute as to these facts. The real point in issue is whether or not an alien under our Constitution may
acquire residential land.

It is said that the decision of the case on the merits is unnecessary, there being a motion to withdraw the appeal
which should have been granted outright, and reference is made to the ruling laid down by this Court in another
case to the effect that a court should not pass upon a constitutional question if its judgment may be made to rest
upon other grounds. There is, we believe, a confusion of ideas in this reasoning. It cannot be denied that the
constitutional question is unavoidable if we choose to decide this case upon the merits. Our judgment cannot to be
made to rest upon other grounds if we have to render any judgment at all. And we cannot avoid our judgment simply
because we have to avoid a constitutional question. We cannot, for instance, grant the motion withdrawing the
appeal only because we wish to evade the constitutional; issue. Whether the motion should be, or should not be,
granted, is a question involving different considerations now to be stated.

According to Rule 52, section 4, of the Rules of Court, it is discretionary upon this Court to grant a withdrawal of
appeal after the briefs have been presented. At the time the motion for withdrawal was filed in this case, not only
had the briefs been prensented, but the case had already been voted and the majority decision was being prepared.
The motion for withdrawal stated no reason whatsoever, and the Solicitor General was agreeable to it. While the
motion was pending in this Court, came the new circular of the Department of Justice, instructing all register of
deeds to accept for registration all transfers of residential lots to aliens. The herein respondent-appellee was
naturally one of the registers of deeds to obey the new circular, as against his own stand in this case which had
been maintained by the trial court and firmly defended in this Court by the Solicitor General. If we grant the
withdrawal, the the result would be that petitioner-appellant Alexander A. Krivenko wins his case, not by a decision
of this Court, but by the decision or circular of the Department of Justice, issued while this case was pending before
this Court. Whether or not this is the reason why appellant seeks the withdrawal of his appeal and why the Solicitor
General readily agrees to that withdrawal, is now immaterial. What is material and indeed very important, is whether
or not we should allow interference with the regular and complete exercise by this Court of its constitutional
functions, and whether or not after having held long deliberations and after having reached a clear and positive
conviction as to what the constitutional mandate is, we may still allow our conviction to be silenced, and the
constitutional mandate to be ignored or misconceived, with all the harmful consequences that might be brought
upon the national patromony. For it is but natural that the new circular be taken full advantage of by many, with the
circumstance that perhaps the constitutional question may never come up again before this court, because both
vendors and vendees will have no interest but to uphold the validity of their transactions, and very unlikely will the
register of deeds venture to disobey the orders of their superior. Thus, the possibility for this court to voice its
conviction in a future case may be remote, with the result that our indifference of today might signify a permanent
offense to the Constitution.

All thse circumstances were thoroughly considered and weighted by this Court for a number of days and the legal
result of the last vote was a denial of the motion withdrawing the appeal. We are thus confronted, at this stage of the
proceedings, with our duty, the constitutional question becomes unavoidable. We shall then proceed to decide that
question.

Article XIII, section 1, of the Constitutional is as follows:

Article XIII. — Conservation and utilization of natural resources.

 SECTION 1. All agricultural, timber, and mineral lands of the public domain, water, minerals, coal,
petroleum, and other mineral oils, all forces of potential energy, and other natural resources of the
Philippines belong to the State, and their disposition, exploitation, development, or utilization shall be limited
to citizens of the Philippines, or to corporations or associations at least sixty per centum of the capital of
which is owned by such citizens, subject to any existing right, grant, lease, or concession at the time of the
inaguration of the Government established uunder this Constitution. Natural resources, with the exception of
public agricultural land, shall not be alienated, and no licence, concession, or lease for the exploitation,
development, or utilization of any of the natural resources shall be granted for a period exceeding twenty-
five years, renewable for another twenty-five years, except as to water rights for irrigation, water supply,
fisheries, or industrial uses other than the development of water "power" in which cases beneficial use may
be the measure and the limit of the grant.

The scope of this constitutional provision, according to its heading and its language, embraces all lands of any kind
of the public domain, its purpose being to establish a permanent and fundamental policy for the conservation and
utilization of all natural resources of the Nation. When, therefore, this provision, with reference to lands of the public
domain, makes mention of only agricultural, timber and mineral lands, it means that all lands of the public domain
are classified into said three groups, namely, agricultural, timber and mineral. And this classification finds
corroboration in the circumstance that at the time of the adoption of the Constitution, that was the basic classification
existing in the public laws and judicial decisions in the Philippines, and the term "public agricultural lands" under said
classification had then acquired a technical meaning that was well-known to the members of the Constitutional
Convention who were mostly members of the legal profession.

As early as 1908, in the case of Mapa vs. Insular Government (10 Phil., 175, 182), this Court said that the phrase
"agricultural public lands" as defined in the Act of Congress of July 1, 1902, which phrase is also to be found in
several sections of the Public Land Act (No. 926), means "those public lands acquired from Spain which are neither
mineral for timber lands." This definition has been followed in long line of decisions of this Court.
(See Montano vs.Insular Government, 12 Phil., 593; Ibañez de Aldecoa vs. Insular Government, 13 Phil., 159;
Ramos vs. Director of Lands, 39 Phil., 175; Jocson vs. Director of Forestry, 39 Phil., 560; Ankron vs. Government of
the Philippines, 40 Phil., 10.) And with respect to residential lands, it has been held that since they are neither
mineral nor timber lands, of necessity they must be classified as agricultural. In Ibañez de Aldecoa vs. Insular
Government (13 Phil., 159, 163), this Court said:

Hence, any parcel of land or building lot is susceptible of cultivation, and may be converted into a field, and
planted with all kinds of vegetation; for this reason, where land is not mining or forestal in its nature, it must
necessarily be included within the classification of agricultural land, not because it is actually used for the
purposes of agriculture, but because it was originally agricultural and may again become so under other
circumstances; besides, the Act of Congress contains only three classification, and makes no special
provision with respect to building lots or urban lands that have ceased to be agricultural land.

In other words, the Court ruled that in determining whether a parcel of land is agricultural, the test is not only
whether it is actually agricultural, but also its susceptibility to cultivation for agricultural purposes. But whatever the
test might be, the fact remains that at the time the Constitution was adopted, lands of the public domain were
classified in our laws and jurisprudence into agricultural, mineral, and timber, and that the term "public agricultural
lands" was construed as referring to those lands that were not timber or mineral, and as including residential lands.
It may safely be presumed, therefore, that what the members of the Constitutional Convention had in mind when
they drafted the Constitution was this well-known classification and its technical meaning then prevailing.

Certain expressions which appear in Constitutions, . . . are obviously technical; and where such words have
been in use prior to the adoption of a Constitution, it is presumed that its framers and the people who ratified
it have used such expressions in accordance with their technical meaning. (11 Am. Jur., sec. 66, p.
683.) AlsoCalder vs. Bull, 3 Dall. [U.S.], 386; 1 Law. ed., 648; Bronson vs. Syverson, 88 Wash., 264; 152 P.,
1039.)

It is a fundamental rule that, in construing constitutions, terms employed therein shall be given the meaning
which had been put upon them, and which they possessed, at the time of the framing and adoption of the
instrument. If a word has acquired a fixed, technical meaning in legal and constitutional history, it will be
presumed to have been employed in that sense in a written Constitution. (McKinney vs. Barker, 180 Ky.,
526; 203 S.W., 303; L.R.A., 1918 E, 581.)

Where words have been long used in a technical sense and have been judicially construed to have a certain
meaning, and have been adopted by the legislature as having a certain meaning prior to a particular statute
in which they are used, the rule of construction requires that the words used in such statute should be
construed according to the sense in which they have been so previously used, although the sense may vary
from strict literal meaning of the words. (II Sutherland, Statutory Construction, p. 758.)

Therefore, the phrase "public agricultural lands" appearing in section 1 of Article XIII of the Constitution must be
construed as including residential lands, and this is in conformity with a legislative interpretation given after the
adoption of the Constitution. Well known is the rule that "where the Legislature has revised a statute after a
Constitution has been adopted, such a revision is to be regarded as a legislative construction that the statute so
revised conforms to the Constitution." (59 C.J., 1102.) Soon after the Constitution was adopted, the National
Assembly revised the Public Land Law and passed Commonwealth Act No. 141, and sections 58, 59 and 60 thereof
permit the sale of residential lots to Filipino citizens or to associations or corporations controlled by such citizens,
which is equivalent to a solemn declaration that residential lots are considered as agricultural lands, for, under the
Constitution, only agricultural lands may be alienated.

It is true that in section 9 of said Commonwealth Act No. 141, "alienable or disposable public lands" which are the
same "public agriculture lands" under the Constitution, are classified into agricultural, residential, commercial,
industrial and for other puposes. This simply means that the term "public agricultural lands" has both a broad and a
particular meaning. Under its broad or general meaning, as used in the Constitution, it embraces all lands that are
neither timber nor mineral. This broad meaning is particularized in section 9 of Commonwealth Act No. 141 which
classifies "public agricultural lands" for purposes of alienation or disposition, into lands that are stricly agricultural or
actually devoted to cultivation for agricultural puposes; lands that are residential; commercial; industrial; or lands for
other purposes. The fact that these lands are made alienable or disposable under Commonwealth Act No. 141, in
favor of Filipino citizens, is a conclusive indication of their character as public agricultural lands under said statute
and under the Constitution.

It must be observed, in this connection that prior to the Constitution, under section 24 of Public Land Act No. 2874,
aliens could acquire public agricultural lands used for industrial or residential puposes, but after the Constitution and
under section 23 of Commonwealth Act No. 141, the right of aliens to acquire such kind of lands is completely
stricken out, undoubtedly in pursuance of the constitutional limitation. And, again, prior to the Constitution, under
section 57 of Public Land Act No. 2874, land of the public domain suitable for residence or industrial purposes could
be sold or leased to aliens, but after the Constitution and under section 60 of Commonwealth Act No. 141, such land
may only be leased, but not sold, to aliens, and the lease granted shall only be valid while the land is used for the
purposes referred to. The exclusion of sale in the new Act is undoubtedly in pursuance of the constitutional
limitation, and this again is another legislative construction that the term "public agricultural land" includes land for
residence purposes.

Such legislative interpretation is also in harmony with the interpretation given by the Executive Department of the
Government. Way back in 1939, Secretary of Justice Jose Abad Santos, in answer to a query as to "whether or not
the phrase 'public agricultural lands' in section 1 of Article XII (now XIII) of the Constitution may be interpreted to
include residential, commercial, and industrial lands for purposes of their disposition," rendered the following short,
sharp and crystal-clear opinion:

Section 1, Article XII (now XIII) of the Constitution classifies lands of the public domain in the Philippines into
agricultural, timber and mineral. This is the basic classification adopted since the enactment of the Act of
Congress of July 1, 1902, known as the Philippine Bill. At the time of the adoption of the Constitution of the
Philippines, the term 'agricultural public lands' and, therefore, acquired a technical meaning in our public
laws. The Supreme Court of the Philippines in the leading case of Mapa vs. Insular Government, 10 Phil.,
175, held that the phrase 'agricultural public lands' means those public lands acquired from Spain which are
neither timber nor mineral lands. This definition has been followed by our Supreme Court in many
subsequent case. . . .

Residential commercial, or industrial lots forming part of the public domain must have to be included in one
or more of these classes. Clearly, they are neither timber nor mineral, of necessity, therefore, they must be
classified as agricultural.

Viewed from another angle, it has been held that in determining whether lands are agricultural or not, the
character of the land is the test (Odell vs. Durant, 62 N.W., 524; Lorch vs. Missoula Brick and Tile Co., 123
p.25). In other words, it is the susceptibility of the land to cultivation for agricultural purposes by ordinary
farming methods which determines whether it is agricultural or not (State vs. Stewart, 190 p. 129).

Furthermore, as said by the Director of Lands, no reason is seen why a piece of land, which may be sold to
a person if he is to devote it to agricultural, cannot be sold to him if he intends to use it as a site for his
home.

This opinion is important not alone because it comes from a Secratary of Justice who later became the Chief Justice
of this Court, but also because it was rendered by a member of the cabinet of the late President Quezon who
actively participated in the drafting of the constitutional provision under consideration. (2 Aruego, Framing of the
Philippine Constitution, p. 598.) And the opinion of the Quezon administration was reiterated by the Secretary of
Justice under the Osmeña administration, and it was firmly maintained in this Court by the Solicitor General of both
administrations.

It is thus clear that the three great departments of the Government — judicial, legislative and executive — have
always maintained that lands of the public domain are classified into agricultural, mineral and timber, and that
agricultural lands include residential lots.

Under section 1 of Article XIII of the Constitution, "natural resources, with the exception of public agricultural land,
shall not be aliented," and with respect to public agricultural lands, their alienation is limited to Filipino citizens. But
this constitutional purpose conserving agricultural resources in the hands of Filipino citizens may easily be defeated
by the Filipino citizens themselves who may alienate their agricultural lands in favor of aliens. It is partly to prevent
this result that section 5 is included in Article XIII, and it reads as follows:

Sec. 5. Save in cases of hereditary succession, no private agricultural land will be transferred or assigned
except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain in
the Philippines.

This constitutional provision closes the only remaining avenue through which agricultural resources may leak into
aliens' hands. It would certainly be futile to prohibit the alienation of public agricultural lands to aliens if, after all, they
may be freely so alienated upon their becoming private agricultural lands in the hands of Filipino citizens.
Undoubtedly, as above indicated, section 5 is intended to insure the policy of nationalization contained in section 1.
Both sections must, therefore, be read together for they have the same purpose and the same subject matter. It
must be noticed that the persons against whom the prohibition is directed in section 5 are the very same persons
who under section 1 are disqualified "to acquire or hold lands of the public domain in the Philippines." And the
subject matter of both sections is the same, namely, the non-transferability of "agricultural land" to aliens. Since
"agricultural land" under section 1 includes residential lots, the same technical meaning should be attached to
"agricultural land under section 5. It is a rule of statutory construction that "a word or phrase repeated in a statute
will bear the same meaning throughout the statute, unless a different intention appears." (II Sutherland, Statutory
Construction, p. 758.) The only difference between "agricultural land" under section 5, is that the former is public
and the latter private. But such difference refers to ownership and not to the class of land. The lands are the same in
both sections, and, for the conservation of the national patrimony, what is important is the nature or class of the
property regardless of whether it is owned by the State or by its citizens.

Reference is made to an opinion rendered on September 19, 1941, by the Hon. Teofilo Sison, then Secretary of
Justice, to the effect that residential lands of the public domain may be considered as agricultural lands, whereas
residential lands of private ownership cannot be so considered. No reason whatsoever is given in the opinion for
such a distinction, and no valid reason can be adduced for such a discriminatory view, particularly having in mind
that the purpose of the constitutional provision is the conservation of the national patrimony, and private residential
lands are as much an integral part of the national patrimony as the residential lands of the public domain. Specially
is this so where, as indicated above, the prohibition as to the alienable of public residential lots would become
superflous if the same prohibition is not equally applied to private residential lots. Indeed, the prohibition as to
private residential lands will eventually become more important, for time will come when, in view of the constant
disposition of public lands in favor of private individuals, almost all, if not all, the residential lands of the public
domain shall have become private residential lands.

It is maintained that in the first draft of section 5, the words "no land of private ownership" were used and later
changed into "no agricultural land of private ownership," and lastly into "no private agricultural land" and from these
changes it is argued that the word "agricultural" introduced in the second and final drafts was intended to limit the
meaning of the word "land" to land actually used for agricultural purposes. The implication is not accurate. The
wording of the first draft was amended for no other purpose than to clarify concepts and avoid uncertainties. The
words "no land" of the first draft, unqualified by the word "agricultural," may be mistaken to include timber and
mineral lands, and since under section 1, this kind of lands can never be private, the prohibition to transfer the same
would be superfluous. Upon the other hand, section 5 had to be drafted in harmony with section 1 to which it is
supplementary, as above indicated. Inasmuch as under section 1, timber and mineral lands can never be private,
and the only lands that may become private are agricultural lands, the words "no land of private ownership" of the
first draft can have no other meaning than "private agricultural land." And thus the change in the final draft is merely
one of words in order to make its subject matter more specific with a view to avoiding the possible confusion of
ideas that could have arisen from the first draft.

If the term "private agricultural lands" is to be construed as not including residential lots or lands not strictly
agricultural, the result would be that "aliens may freely acquire and possess not only residential lots and houses for
themselves but entire subdivisions, and whole towns and cities," and that "they may validly buy and hold in their
names lands of any area for building homes, factories, industrial plants, fisheries, hatcheries, schools, health and
vacation resorts, markets, golf courses, playgrounds, airfields, and a host of other uses and purposes that are not, in
appellant's words, strictly agricultural." (Solicitor General's Brief, p. 6.) That this is obnoxious to the conservative
spirit of the Constitution is beyond question.

One of the fundamental principles underlying the provision of Article XIII of the Constitution and which was
embodied in the report of the Committee on Nationalization and Preservation of Lands and other Natural Resources
of the Constitutional Convention, is "that lands, minerals, forests, and other natural resources constitute the
exclusive heritage of the Filipino nation. They should, therefore, be preserved for those under the sovereign
authority of that nation and for their posterity." (2 Aruego, Framing of the Filipino Constitution, p. 595.) Delegate
Ledesma, Chairman of the Committee on Agricultural Development of the Constitutional Convention, in a speech
delivered in connection with the national policy on agricultural lands, said: "The exclusion of aliens from the privilege
of acquiring public agricultural lands and of owning real estate is a necessary part of the Public Land Laws of the
Philippines to keep pace with the idea of preserving the Philippines for the Filipinos." (Emphasis ours.) And, of the
same tenor was the speech of Delegate Montilla who said: "With the complete nationalization of our lands and
natural resources it is to be understood that our God-given birthright should be one hundred per cent in Filipino
hands . . .. Lands and natural resources are immovables and as such can be compared to the vital organs of a
person's body, the lack of possession of which may cause instant death or the shortening of life. If we do not
completely antionalize these two of our most important belongings, I am afraid that the time will come when we shall
be sorry for the time we were born. Our independence will be just a mockery, for what kind of independence are we
going to have if a part of our country is not in our hands but in those of foreigners?" (Emphasis ours.) Professor
Aruego says that since the opening days of the Constitutional Convention one of its fixed and dominating objectives
was the conservation and nationalization of the natural resources of the country. (2 Aruego, Framing of the
Philippine Constitution, p 592.) This is ratified by the members of the Constitutional Convention who are now
members of this Court, namely, Mr. Justice Perfecto, Mr. Justice Briones, and Mr. Justice Hontiveros. And, indeed, if
under Article XIV, section 8, of the Constitution, an alien may not even operate a small jitney for hire, it is certainly
not hard to understand that neither is he allowed to own a pieace of land.

This constitutional intent is made more patent and is strongly implemented by an act of the National Assembly
passed soon after the Constitution was approved. We are referring again to Commonwealth Act No. 141. Prior to
the Constitution, there were in the Public Land Act No. 2874 sections 120 and 121 which granted aliens the right to
acquire private only by way of reciprocity. Said section reads as follows:

SEC. 120. No land originally acquired in any manner under the provisions of this Act, nor any permanent
improvement on such land, shall be encumbered, alienated, or transferred, except to persons, corporations,
associations, or partnerships who may acquire lands of the public domain under this Act; to corporations
organized in the Philippine Islands authorized therefor by their charters, and, upon express authorization by
the Philippine Legislature, to citizens of countries the laws of which grant to citizens of the Philippine Islands
the same right to acquire, hold, lease, encumber, dispose of, or alienate land, or permanent improvements
thereon, or any interest therein, as to their own citizens, only in the manner and to the extent specified in
such laws, and while the same are in force but not thereafter.

SEC. 121. No land originally acquired in any manner under the provisions of the former Public Land Act or of
any other Act, ordinance, royal order, royal decree, or any other provision of law formerly in force in the
Philippine Islands with regard to public lands, terrenos baldios y realengos, or lands of any other
denomination that were actually or presumptively of the public domain or by royal grant or in any other form,
nor any permanent improvement on such land, shall be encumbered, alienated, or conveyed, except to
persons, corporations, or associations who may acquire land of the public domain under this Act; to
corporate bodies organized in the Philippine Islands whose charters may authorize them to do so, and, upon
express authorization by the Philippine Legislature, to citizens of the countries the laws of which grant to
citizens of the Philippine Islands the same right to acquire, hold, lease, encumber, dispose of, or alienate
land or pemanent improvements thereon or any interest therein, as to their own citizens, and only in the
manner and to the extent specified in such laws, and while the same are in force, but not
thereafter: Provided, however, That this prohibition shall not be applicable to the conveyance or acquisition
by reason of hereditary succession duly acknowledged and legalized by competent courts, nor to lands and
improvements acquired or held for industrial or residence purposes, while used for such purposes: Provided,
further, That in the event of the ownership of the lands and improvements mentioned in this section and in
the last preceding section being transferred by judicial decree to persons,corporations or associations not
legally capacitated to acquire the same under the provisions of this Act, such persons, corporations, or
associations shall be obliged to alienate said lands or improvements to others so capacitated within the
precise period of five years, under the penalty of such property reverting to the Government in the contrary
case." (Public Land Act, No. 2874.)

It is to be observed that the pharase "no land" used in these section refers to all private lands, whether strictly
agricultural, residential or otherwise, there being practically no private land which had not been acquired by any of
the means provided in said two sections. Therefore, the prohibition contained in these two provisions was, in effect,
that no private land could be transferred to aliens except "upon express authorization by the Philippine Legislature,
to citizens of Philippine Islands the same right to acquire, hold, lease, encumber, dispose of, or alienate land." In
other words, aliens were granted the right to acquire private land merely by way of reciprocity. Then came the
Constitution and Commonwealth Act No. 141 was passed, sections 122 and 123 of which read as follows:

SEC. 122. No land originally acquired in any manner under the provisions of this Act, nor any permanent
improvement on such land, shall be encumbered, alienated, or transferred, except to persons, corporations,
associations, or partnerships who may acquire lands of the public domain under this Act or to corporations
organized in the Philippines authorized thereof by their charters.

SEC. 123. No land originally acquired in any manner under the provisions of any previous Act, ordinance,
royal order, royal decree, or any other provision of law formerly in force in the Philippines with regard to
public lands terrenos baldios y realengos, or lands of any other denomination that were actually or
presumptively of the public domain, or by royal grant or in any other form, nor any permanent improvement
on such land, shall be encumbered, alienated, or conveyed, except to persons, corporations or associations
who may acquire land of the public domain under this Act or to corporate bodies organized in the Philippines
whose charters authorize them to do so: Provided, however, That this prohibition shall not be applicable to
the conveyance or acquisition by reason of hereditary succession duly acknowledged and legalized by
competent courts: Provided, further, That in the event of the ownership of the lands and improvements
mentioned in this section and in the last preceding section being transferred by judicial decree to persons,
corporations or associations not legally capacitated to acquire the same under the provisions of this Act,
such persons, corporations, or associations shall be obliged to alienate said lands or improvements to
 others so capacitated within the precise period of five years; otherwise, such property shall revert to the
Government.

These two sections are almost literally the same as sections 120 and 121 of Act No. 2874, the only difference being
that in the new provisions, the right to reciprocity granted to aliens is completely stricken out. This, undoubtedly, is to
conform to the absolute policy contained in section 5 of Article XIII of the Constitution which, in prohibiting the
alienation of private agricultural lands to aliens, grants them no right of reciprocity. This legislative construction
carries exceptional weight, for prominent members of the National Assembly who approved the new Act had been
members of the Constitutional Convention.

It is said that the lot question does not come within the purview of sections 122 and 123 of Commonwealth Act No.
141, there being no proof that the same had been acquired by one of the means provided in said provisions. We are
not, however, diciding the instant case under the provisions of the Public Land Act, which have to refer to land that
had been formerly of the public domain, otherwise their constitutionality may be doubtful. We are deciding the
instant case under section 5 of Article XIII of the Constitution which is more comprehensive and more absolute in
the sense that it prohibits the transfer to alien of any private agricultural land including residential land whatever its
origin might have been.

And, finally, on June 14, 1947, the Congress approved Republic Act No. 133 which allows mortgage of "private real
property" of any kind in favor of aliens but with a qualification consisting of expressly prohibiting aliens to bid or take
part in any sale of such real property as a consequence of the mortgage. This prohibition makes no distinction
between private lands that are strictly agricultural and private lands that are residental or commercial. The
prohibition embraces the sale of private lands of any kind in favor of aliens, which is again a clear implementation
and a legislative interpretation of the constitutional prohibition. Had the Congress been of opinion that private
residential lands may be sold to aliens under the Constitution, no legislative measure would have been found
necessary to authorize mortgage which would have been deemed also permissible under the Constitution. But
clearly it was the opinion of the Congress that such sale is forbidden by the Constitution and it was such opinion that
prompted the legislative measure intended to clarify that mortgage is not within the constitutional prohibition.

It is well to note at this juncture that in the present case we have no choice. We are construing the Constitution as it
is and not as we may desire it to be. Perhaps the effect of our construction is to preclude aliens, admitted freely into
the Philippines from owning sites where they may build their homes. But if this is the solemn mandate of the
Constitution, we will not attempt to compromise it even in the name of amity or equity. We are satisfied, however,
that aliens are not completely excluded by the Constitution from the use of lands for residential purposes. Since their
residence in the Philippines is temporary, they may be granted temporary rights such as a lease contract which is
not forbidden by the Constitution. Should they desire to remain here forever and share our fortunes and misfortunes,
Filipino citizenship is not impossible to acquire.

For all the foregoing, we hold that under the Constitution aliens may not acquire private or public agricultural lands,
including residential lands, and, accordingly, judgment is affirmed, without costs.

Feria, Pablo, Perfecto, Hilado, and Briones, JJ., concur.

Separate Opinion

PERFECTO, J., concurring:

Today, which is the day set for the promulgation of this Court's decision might be remembered by future generations
always with joy, with gratitude, with pride. The failure of the highest tribunal of the land to do its duty in this case
would have amounted to a national disaster. We would have refused to share the responsibility of causing it by,
wittingly or unwittingly, allowing ourselves to act as tools in a conspiracy to sabotage the most important safeguard
of the age-long patrimony of our people, the land which destiny of Providence has set aside to be the permanent
abode of our race for unending generations. We who have children and grandchildren, and who expect to leave long
and ramifying dendriform lines of descendants, could not bear the thought of the curse they may fling at us should
the day arrive when our people will be foreigners in their fatherland, because in the crucial moment of our history ,
when the vision of judicial statemanship demanded on us the resolution and boldness to affirm and withhold the
letter and spirit of the Constitution, we faltered. We would have prefered heroic defeat to inglorious desertion. Rather
than abandon the sacred folds of the banner of our convictions for truth, for justice, for racial survival. We are happy
to record that this Supreme Court turned an impending failure to a glorious success, saving our people from a
looming catastrophe.

On July 3, 1946, the case of Oh Cho vs. Director of Lands, (43 Off. Gaz., 866), was submitted for our decision. The
case was initiated in the Court of First Instance of Tayabas on January 17, 1940, when an alien, Oh Cho, a citizen of
China, applied for title and registration of a parcel of land located in the residential district of Guinayangan, Tayabas,
with a house thereon. The Director of Lands opposed the application, one of the main grounds being that "the
applicant, being a Chinese, is not qualified to acquire public or private agricultural lands under the provisions of the
Constitution."

On August 15, 1940, Judge P. Magsalin rendered decision granting the application. The Director of Lands appealed.
In the brief filed by Solicitor General Roman Ozaeta, afterwards Associate Justice of the Supreme Court and now
Secretary of Justice, and Assistant Solicitor General Rafael Amparo, appellant made only two assignments of error,
although both raised but one question, the legal one stated in the first assignment of error as follows:

The lower court erred in declaring the registration of the land in question in favor of the applicant who,
according to his own voluntary admission is a citizen of the Chinese Republic.

The brief was accompanied, as Appendix A, by the opinion of Secretary of Justice Jose A. Santos — who, while
Chief Justice of the Supreme Court, suffered heroic martyrdom at the hands of the Japanese — addressed to the
Secretary of Agriculture and Commerce on July 15, 1939, supporting the same theory as the one advanced by the
Director of Lands. The same legal question raised by appellant is discussed, not only in the brief for the appellee,
but also in the briefs of the several amici curiae allowed by the Supreme Court to appear in the case.

As a matter of fact, the case has been submitted for final decision of the Supreme Court since July of 1941, that is,
six years ago. It remained undecided when the Pacific War broke out in December, 1941. After the Supreme Court
was recognized in the middle of 1945, it was found that the case was among those which were destroyed in
February, 1945, during the battle for the liberation of Manila. The case had to be reconstituted upon motion of the
office of the Solicitor General, filed with this Court on January 14, 1946, in which it was also prayed that, after being
reconstituted, the case be submitted for final adjudication. The case was for the second time submitted for decision
on July 3, 1946.

After the last submission, it took the Supreme Court many days to deliberate on the case, especially on the legal
question as to whether an alien may, under the Constitution, acquire private urban lands. An overwhelming majority
answered no. But when the decision was promulgated on August 31, 1946, a majority resolved to ignore the
question, notwithstanding our efforts to have the question, which is vital, pressing and far-reaching, decided once
and for all, to dispel definitely the uncertainty gnawing the conscience of the people. It has been out lot to be alone
in expressing in unmistakable terms our opinion and decision on the main legal question raised by the appellant.
The constitutional question was by-passed by the majority because they were of opinion that it was not necessary to
be decided, notwithstanding the fact that it was the main and only legal question upon which appellant Director of
Lands relied in his appeal, and the question has been almost exhaustively argued in four printed briefs filed by the
parties and the amici curiae. Assurance was, nevertheless, given that in the next case in which the same
constitutional question is raised, the majority shall make known their stand on the question.

The next case came when the present one submitted to us for decision on February 3, 1947. Again, we deliberated
on the constitutional question for several days.

On February 24, 1947, the case was submitted for final vote, and the result was that the constitutional question was
decided against petitioner. The majority was also overwhelming. There were eight of us, more than two-thirds of the
Supreme Court. Only three Justices dissented.

While the decision was being drafted, somehow, the way the majority had voted must have leaked out. On July 10,
1947, appellant Krivenko filed a motion for withdrawal of his appeal, for the evident purpose of preventing the
rendering of the majority decision, which would settle once and for all the all-important constitutional question as to
whether aliens may acquire urban lots in the Philippines.

Appellant chose to keep silent as to his reason for filing the motion. The Solicitor General's office gave its conformity
to the withdrawal of the appeal. This surprising assent was given without expressing any ground at all. Would the
Supreme Court permit itself to be cheated of its decision voted since February 24, 1947?

Discussion immediately ensued as to whether the motion should be granted or denied, that is, whether this Court
should abstain from promulgating the decision in accordance with the result of the vote taken on February 24, 1947,
as if, after more than six years during which the question has been submitted for the decision of the highest tribunal
of the land, the same has failed to form a definite opinion.

After a two-day deliberation, the Chief Justice, Mr. Justice Paras, Mr. Justice Hontiveros, Mr. Justice Padilla and and
Mr. Justice Tuason voted to grant the motion for withdrawal. Those who voted to deny the motion were Mr. Justice
Feria, Mr. Justice Pablo, ourselves, Mr. Justice Hilado and Mr. Justice Bengzon. The vote thus resulted in a tie, 5-5.
The deadlock resulting from the tie should have the effect of denying the motion, as provided by section 2 of Rule 56
to the effect that "where the Court in banc is equally divided in opinion . . . on all incidental matters, the petition or
motion shall be denied." And we proposed that the rule be complied with, and the denial be promulgated.

Notwithstanding this, as Mr. Justice Briones was then absent, our brethren resolved to give him the opportunity of
casting his vote on the question, although we insisted that it was unnecessary. Days later, when all the members of
the Court were already present, a new vote was taken. Mr. Justice Briones voted for the denial of the motion, and
his vote would have resulted, as must be expected, in 6 votes for the denial against 5 for granting. But the final
result was different. Seven votes were cast for granting the motion and only four were cast for its denial.

But then, by providential design or simply by a happy stroke of luck or fate, on the occasion of the registration by the
register of deeds of Manila of land purchases of two aliens, a heated public polemic flared up in one section of the
press, followed by controversial speeches, broadcast by radio, and culminating in the issuance on August 12, 1947,
of Circular No. 128 of the Secretary of Justice which reads as follows:

TO ALL REGISTER OF DEEDS:

Paragraph 5 of Circular No. 14, dated August 25, 1945, is hereby amended so as to read as follows:

5"(a). Instruments by which private real property is mortgaged in favor of any individual, corporation, or
association for a period not exceeding five years, renewable for another five years, may be accepted for
registration. (Section 1, Republic Act No. 138.)

"(b). Deeds or documents by which private residential, commercial, industrial or other classes of urban
lands, or any right, title or interest therein is transferred, assigned or encumbered to an alien, who is not an
enemy national, may be registered. Such classes of land are not deemed included within the purview of the
prohibition contained in section 5, Article XIII of the Constitution against the acquisition or holding of "private
agricultural land" by those who are not qualified to hold or acquire lands of the public domain. This is in
conformity with Opinion No. 284, series of 1941, of the Secretary of Justice and with the practice
consistently followed for nearly ten years since the Constitution took effect on November 15, 1935.

"(c). During the effectivity of the Executive Agreement entered into between the Republic of the Philippines
and the Government of the United States on July 4, 1946, in pursuance of the so-called Parity Amendment
to the Constitution, citizens of the United States and corporations or associations owned or controlled by
such citizens are deemed to have the same rights as citizens of the Philippines and corporations or
associations owned or controlled by such are deemed to have the same rights as citizens of the Philippines
and corporations or associations owned or controlled by citizens of the Philippines in the acquisition of all
classes of lands in the Philippines, whether of private ownership or pertaining to the public domain."

ROMAN OZAETA
Secretary of Justice

Paragraph 5 of Circular No. 14 dated August 25, 1945, amended by the above is as follows:

Deeds or other documents by which a real property, or a right, or title thereto, or an interest therein, is
transferred, assigned or encumbered to an alien, who is not enemy national, may be entered in the primary
entry book; but, the registration of said deeds or other documents shall be denied — unless and/or until
otherwise specifically directed by a final decision or order of a competent court — and the party in interest
shall be advised of such denial, so that he could avail himself of the right to appeal therefrom, under the
provisions of section 200 of the Revised Administrative Code. The denial of registration of shall be
predicated upon the prohibition contained in section 5, Article XIII (formerly Article XII) of the Constitution of
the Philippines, and sections 122 and 123 of Commonwealth Act No. 141, the former as amended by the
Commonwealth Act No. 615.

The polemic found echo even in the Olympic serenity of a cloistered Supreme Court and the final result of long and
tense deliberation which ensued is concisely recorded in the following resolution adopted on August 29, 1947:

In Krivenko vs. Register of Deeds, City of Manila, L-630, a case already submitted for decision, the appellant
filed a motion to withdraw his appeal with the conformity of the adverse party. After full discussion of the
matter specially in relation to the Court's discretion (Rule 52, section 4, and Rule 58), Mr. Justice Paras, Mr.
Justice Hilado, Mr. Justice Bengzon, Mr. Justice Padilla and Mr. Justice Tuazon voted to grant, while the
Chief Justice, Mr. Justice Feria, Mr,. Justice Pablo, Mr. Justice Perfecto and Mr. Justice Briones voted to
deny it. A redeliberation was consequently had, with the same result. Thereupon Mr. Justice Paras proposed
that Mr. Justice Hontiveros be asked to sit and break the tie; but in view of the latter's absence due to illness
and petition for retirement, the Court by a vote of seven to three did not approve the proposition. Therefore,
under Rule 56, section 2, the motion to withdraw is considered denied.

Mr. Justice Padilla states that in his opinion the tie could not have the effect of overruling the previous vote
of seven against four in favor of the motion to withdraw.

Mr. Justice Paras states: Justice Hontiveros is aware of and conversant with the controversy. He has voted
once on the motion to withdraw the appeal. He is still a member of the Court and, on a moment's notice, can
be present at any session of the Court. Last month, when all the members were present, the votes on the
motion stood 7 to 4. Now, in the absence of one member, on reconsideration, another changed his vote
resulting in a tie. Section 2 of Rule 56 requires that all efforts be exerted to break a deadlock in the votes. I
deplore the inability of the majority to agree to my proposition that Mr. Justice Hontiveros be asked to
 participate in the resolution of the motion for withdrawal. I hold it to be fundamental and necessary that the
votes of all the members be taken in cases like this.

Mr. Justice Perfecto stated, for purposes of completeness of the narration of facts, that when the petition to
withdraw the appeal was submitted for resolution of this Court two days after this petition was filed, five
justices voted to grant and five others voted to deny, and expressed the opinion that since then, according to
the rules, the petition should have been considered denied. Said first vote took place many days before the
one alluded to by Mr. Justice Padilla.

Mr. Justice Tuason states: The motion to withdraw the appeal was first voted upon with the result that 5
were granting and 5 for denial. Mr. Justice Briones was absent and it was decided to wait for him. Some
time later, the same subject was deliberated upon and a new voting was had, on which occasion all the 11
justices were present. The voting stood 7 for allowing the dismissal of the appeal and 4 against. Mr. Justice
Perfecto and Mr. Justice Briones expressed the intention to put in writing their dissents. Before these
dissents were filed, about one month afterwards, without any previous notice the matter was brought up
again and re-voted upon; the result was 5 to 5. Mr. Justice Hontiveros, who was ill but might have been able
to attend if advised of the necessity of his presence, was absent. As the voting thus stood, Mr. Justice
Hontiveros' vote would have changed its result unless he changed his mind, a fact of which no one is aware.
My opinion is that since there was no formal motion for reconsideration nor a previous notice that this matter
would be taken up once more, and since Mr. Justice Hontiveros had every reason to believe that the matter
was over as far as he was concerned, this Justice's vote in the penultimate voting should, if he was not to be
given an opportunity to recast his vote, be counted in favor of the vote for the allowance of the motion to
withdraw. Above all, that opportunity should not have been denied on grounds of pure
technicality never invoked before. I counted that the proceeding was arbitrary and illegal.

The resolution does not recite all the reasons why Mr. Justice Hontiveros did not participate in that last two votings
and why it became unnecessary to wait for him any further to attend the sessions of the Court and to cast his vote
on the question.

Appellant Krivenko moved for the reconsideration of the denial of his withdrawal of appeal, alleging that it became
moot in view of the ruling made by the Secretary of Justice in circular No. 128, thus giving us a hint that the latter,
wittingly or unwittingly, had the effect of trying to take away from the Supreme Court the decision of an important
constitutional question, submitted to us in a pending litigation. We denied the motion for reconsideration. We did not
want to entertain any obstruction to the promulgation of our decision.

If the processes had in this case had been given the publicity suggested by us for all the official actuations of this
Supreme Court, it should have been known by the whole world that since July, 1946, that is, more than a year ago,
the opinion of the members of this Court had already been crystallized to the effect that under the Constitution,
aliens are forbidded from acquiring urban lands in the Philippines, and it must have known that in this case a great
majority had voted in that sense on February 24, 1947.

The constitutional question involved in this case cannot be left undecided without jeopardizing public interest. The
uncertainty in the public mind should be dispelled without further delay. While the doubt among the people as to
what is the correct answer to the question remains to be dissipated, there will be uneasiness, undermining public
morale and leading to evils of unpredictable extent. This Supreme Tribunal, by overwhelming majority, already
knows what the correct answer is, and should not withhold and keep it for itself with the same zealousness with
which the ancient families of the Eumolpides and Keryces were keeping the Eleusinian mysteries. The oracle of
Delphus must speak so that the people may know for their guidance what destiny has in store for them.

The great question as to whether the land bequeathed to us by our forefathers should remain as one of the most
cherished treasures of our people and transmitted by inheritance to unending generations of our race, is not a new
one. The long chain of land-grabbing invasions, conquests, depredations, and colonial imperialism recorded in the
darkest and bloodiest pages of history from the bellicose enterprises of the Hittites in the plains of old Assyria,
irrigated by the waters of the Tigris and Euphrates, and the invasion of Egypt by the Hyksos, up to the conquests of
Hernan Cortes and Pizarro, the achievements of Cecil Rhodes, and the formation of the Spanish, Portuguese,
Dutch, French and German colonial empires, had many of its iron links forged in our soil since Magellan, the
greatest navigator of all history, had set foot at Limasawa and paid, for his daring enterprises, with his life at the
hands of Lapulapu's men in the battle of Mactan.

Since then, almost four centuries ago, our people have continuously been engaged in an unrelentless struggle to
defend the national patrimony against the aggressive onslaughts of foreigners bent on grabbing our lands. First
came the Spanish encomenderos and other gratuitous concessioners who were granted by the Spanish crown
immense areas of land. Immediately came the friars and other religious corporations who, notwithstanding their
sacred vow of poverty, felt their greed whetted by the bountiful opportunities for easy and unscrupulous enrichment.
Taking advantage of the uncontrollable religious leadership, on one side, and of the Christian virtues of obedience,
resignation, humility, and credulity of a people who, after conversion to Catholicism, embraced with tacit faith all its
tenets and practiced them with the loyalty and fidelity of persons still immune from the disappointments and
bitterness caused by the vices of modern civilization, the foreign religious orders set aside all compunction to
acquire by foul means many large estates. Through the practice of confession and other means of moral
intimidation, mostly based on the eternal tortures of hell, they were able to obtain by donation or by will the lands of
many simple and credulous Catholics who, in order to conquer the eternal bliss of heaven, renounced all their
property in favor of religious orders and priests, many under the guise of chaplaincies or other apparently religious
purposes, leaving in destitute their decendants and relatives. Thus big religious landed estates were formed, and
under the system unbearable iniquities were committed. The case of the family of Rizal is just an index of the
situation, which, under the moral leadership of the hero, finally drove our people into a national revolution not only
against the Spanish sovereignty under which the social cancer had grown to unlimited proportions.

Profiting from the lessons of history, the Delegates to our Constitutional Convention felt it their duty to insert in the
fundamental law effective guarantees for conserving the national patrimony, the wisdom of which cannot be
disputed in a world divided into nations and nationalities. In the same way that scientists and technicians resorted to
radar, sonars, thermistors and other long range detection devices to stave off far-away enemy attacks in war, said
Delegates set the guarantees to ward off open inroads or devious incursions into the national patrimony as a means
of insuring racial safety and survival.

When the ideal of one world should have been translated into reality, those guarantees might not be needed and our
people may eliminate them. But in the meantime, it is our inescapable devoir, as the ultimate guardians of the
Constitution, never to neglect the enforcement of its provisions whenever our action is called upon in a case, like the
one now before us.

One of the fundamental purposes of the government established by our Constitution is, in its very words, that it
"shall conserve and develop the patrimony of the nation." That mandate is addressed to all departments and
branches of our government, without excluding this Supreme Court. To make more specific the mandate, Article XIII
has been inserted so as to avoid all doubt that all the natural resources of the country are reserved to Filipino
citizens. Our land is the most important of our natural resources. That land should be kept in the hands of our
people until, by constitutional amendment, they should decide to renounce that age-long patrimony. Save by
hereditary succession — the only exception allowed by the Constitution — no foreigner may by any means acquire
any land, any kind of land, in the Philippines. That was the overwhelming sentiment prevailing in the Constitutional
Convention, that was the overpowering desire of the great majority of the Delegates, that was the dominating
thought that was intended to be expressed in the great document, that was what the Committee on Style — the
drafter of the final text — has written in the Constitution, and that was what was solemnly ratified in the plebiscite by
our people, who then were rankling by the sore spot of illegally Japanized Davao.

The urgency of settling once and forever the constitutional question raised in this case cannot be
overemphasized. If we should decide this question after many urban lots have been transferred to and
registered in the name of alien purchasers, a situation may be created in which it will be hard to nullify the
transfers and the nullification may create complications and problems highly distasteful to solve. The
Georgia case is an objective lesson upon which we can mirror ourselves. From pages 22 and 23 of the book
of Charless P. Curtiss, Jr. entitled "Lions Under the Throne," we quote the following:

It is of interest that it seems to have happened chiefly in important cases. Fletcher vs. Peck, in 1810, is the
stock example. That was the first case in which the Court held a state statute void. It involved a national
scandal. The 1795 legislature of Georgia sold its western lands, most of Alabama and Mississippi, to
speculators. Perhaps it was the greatest real estate steal in our history. The purchase price was only half a
million dollars. The next legislature repealed the statute for fraud, the bribery of legislator, but not before the
land companies had completed the deal and unloaded. By that time, and increasingly soon afterwards, more
and more people had bought, and their title was in issue. Eleven million of the acres had been bought for
eleven cents an acre by leading citizens of Boston. How could they clear their title? Alexander Hamilton
gave an opinion, that the repeal of the grant was void under the Constitution as an impairment of the
obligation of a contract.

But could they not get a decision from the Supreme Court? Robert Fletcher of Anhirst, New Hampshire, had
bought fifteen thousand acres from John Peck of Boston. He sued Peck, and he won. Fletcher appealed.
Plainly it was a friendly suit. Marshall was nobody's fool. He told Cranch that the Court was reluctant to
decide the case "as it appeared manifestly made up for the purpose of getting the Court's judgment." John
Quincy Adams so reports in his diary. Yet Marshall decided it, and he held the repeal void, just as Hamilton
said it was. "The fact that Marshall rendered an opinion, under the circumstances," says Beveridge, "is one
of the finest proofs of his greatness. A weaker man than John Marshall, and one less wise and courageous,
would have dismissed the appeal." That may be, but it was the act of a stateman, not of a judge. The Court
has always been able to overcome its judicial diffidence on state occasions.

We see from the above how millions of acres of land were stolen from the people of Georgia and due to legal
technicalities the people were unable to recover the stolen property. But in the case of Georgia, the lands had fallen
into American hands and although the scandal was of gigantic proportions, no national disaster ensued. In our case
if our lands should fall into foreign hands, although there may not be any scandal at all, the catastrophe sought to be
avoided by the Delegates to our Constitutional Convention will surely be in no remote offing.

We conclude that, under the provisions of the Constitution, aliens are not allowed to acquire the ownership of urban
or residential lands in the Philippines and, as consequence, all acquisitions made in contravention of the prohibitions
since the fundamental law became effective are null and void per se and ab initio. As all public officials have sworn,
and are duty bound, to obey and defend the Constitution, all those who, by their functions, are in charge of enforcing
the prohibition as laid down and interpreted in the decision in this case, should spare no efforts so that any and all
violations which may have taken place should be corrected.

We decide, therefore, that, upon the above premises, appellant Alexander A. Krivenko, not being a Filipino citizen,
could not acquire by purchase the urban or residential lot here in question, the sale made in his favor by the
Magdalena Estate, Inc. being null and void ab initio, and that the lower court acted correctly in rendering the
appealed decision, which we affirm.

G.R. Nos. L-28502-03 April 18, 1989

COMMISSIONER OF INTERNAL REVENUE, petitioner,

vs.
ESSO STANDARD EASTERN, INC. and THE COURT OF TAX APPEALS, respondents.

NARVASA, J.:

In two (2) cases appealed to it 1 by the private respondent, hereafter simply referred to as ESSO, the Court of Tax Appeals rendered
judgment 2sustaining the decisions of the Commissioner of Internal Revenue excepted to, save "the refund-claim .. in the amount of P39,787.94 as overpaid
interest which it ordered refunded to ESSO

Reversal of this decision is sought by the Commissioner by a petition for review on certiorari filed with this Court. He
ascribes to the Tax Court one sole error: "of applying the tax credit for overpayment of the 1959 income tax of ..
ESSO, granted by the petitioner (Commissioner), to .. (ESSO's) basic 1960 deficiency income tax liability x x and
imposing the 1-1/2% monthly interests 3 only on the remaining balance thereof in the sum of P146,961.00" 4 (instead of the full amount of the 1960
deficiency liability in the amount of P367,994.00). Reversal of the same judgment of the Court of Tax Appeals is also sought by ESSO in its own appeal (docketed
as G.R. Nos. L28508-09); but in the brief filed by it in this case, it indicates that it will not press its appeal in the event that "the instant petition for review be denied
and that judgment be rendered affirming the decision of the Court of Tax Appeals."

The facts are simple enough and are quite quickly recounted. ESSO overpaid its 1959 income tax by P221,033.00.
It was accordingly granted a tax credit in this amount by the Comissioner on August 5,1964. However, ESSOs
payment of its income tax for 1960 was found to be short by P367,994.00. So, on July 10, 1964, the Commissioner
wrote to ESSO demanding payment of the deficiency tax, together with interest thereon for the period from April
18,1961 to April 18,1964. On August 10, 1964, ESSO paid under protest the amount alleged to be due, including the
interest as reckoned by the Commissioner. It protested the computation of interest, contending it was more than that
properly due. It claimed that it should not have been required to pay interest on the total amount of the deficiency
tax, P367,994.00, but only on the amount of P146,961.00—representing the difference between said deficiency,
P367,994.00, and ESSOs earlier overpayment of P221,033.00 (for which it had been granted a tax credit). ESSO
thus asked for a refund.

The Internal Revenue Commissioner denied the claim for refund. ESSO appealed to the Court of Tax Appeals. As
aforestated. that Court ordered payment to ESSO of its "refund-claim x x in the amount of P39,787.94 as overpaid
interest. Hence, this appeal by the Commissioner. The CTA justified its award of the refund as follows:

... In the letter of August 5, 1964, .. (the Commissioner) admitted that .. ESSO had overpaid its 1959
income tax by P221,033.00. Accordingly .. (the Commissioner) granted to .. ESSO a tax credit of
P221,033.00. In short, the said sum of P221,033.00 of ESSO's money was in the Government's
hands at the latest on July 15, 1960 when it ESSO paid in full its second installment of income tax
for 1959. On July 10, 1964 .. (the Commissioner) claimed that for 1960, .. ESSO underpaid its
income tax by P367,994.00. However, instead of deducting from P367,994.00 the tax credit of
P221,033.00 which .. (the Commissioner) had already admitted was due .. ESSO .. (the
Commissioner) still insists in collecting the interest on the full amount of P367,994.00 for the period
April 18, 1961 to April 18,1964 when the Government had already in its hands the sum of
P221,033.00 of .. ESSOs money even before the latter's income tax for 1960 was due and payable.
If the imposition of interest does not amount to a penalty but merely a just compensation to the State
for the delay in paying the tax, and for the concomitant use by the taxpayer of funds that rightfully
should be in the Government's hand (Castro v. Collector, G.R. No. L-1274, Dec. 28, 1962), the
collection of the interest on the full amount of P367,994.00 without deducting first the tax credit of
P221,033.00, which has long been in the hands of the Government, becomes erroneous, illegal and
arbitrary.

.. (ESSO) could hardly be charged of delinquency in paying P221,033.00 out of the deficiency
income tax of P367,994.00, for which the State should be compensated by the payment of interest,
because the said amount of P221,033.00 was already in the coffers of the Government. Neither
could .. ESSO be charged for the concomitant use of funds that rightfully belong to the Government
because as early as July 15, 1960, it was the Government that was using .. ESSOs funds of
P221,033.00. In the circumstances, we find it unfair and unjust for .. (the Commissioner) to exact the
 interest on the said sum of P221,033.00 which, after all, was paid to and received by the
Government even before the incidence of the deficiency income tax of P367,994.00. (Itogon-Suyoc
Mines, Inc. v. Commissioner, C.T.A. Case No. 1327, Sept. 30,1965). On the contrary, the
Government should be the first to blaze the trail and set the example of fairness and honest dealing
in the administration of tax laws.

Accordingly, we hold that the tax credit of P221,033.00 for 1959 should first be deducted from the
basic deficiency tax of P367,994.00 for 1960 and the resulting difference of P146,961.00 would be
subject to the 18% interest prescribed by Section 51 (d) of the Revenue Code. According to the
prayer of ..(ESSO) .. (the Commissioner) is hereby ordered to refund to .. (ESSO) the amount of
P39,787.94 as overpaid interest in the settlement of its 1960 income tax liability. However, as the
collection of the tax was not attended with arbitrariness because .. (ESSO) itself followed x x (the
Commissioner's) manner of computing the tax in paying the sum of P213,189.93 on August 10,
1964, the prayer of .. (ESSO) that it be granted the legal rate of interest on its overpayment of
P39,787.94 from August 10, 1964 to the time it is actually refunded is denied. (See Collector of
Internal Revenue v. Binalbagan Estate, Inc., G.R. No. 1,12752, Jan. 30, 1965).

The Commissioner's position is that income taxes are determined and paid on an annual basis, and that such
determination and payment of annual taxes are separate and independent transactions; and that a tax credit could
not be so considered until it has been finally approved and the taxpayer duly notified thereof. Since in this case, he
argues, the tax credit of P221,033.00 was approved only on August 5, 1964, it could not be availed of in reduction of
ESSOs earlier tax deficiency for the year 1960; as of that year, 1960, there was as yet no tax credit to speak of,
which would reduce the deficiency tax liability for 1960. In support of his position, the Commissioner invokes the
provisions of Section 51 of the Tax Code pertinently reading as follows:

(c) Definition of deficiency. As used in this Chapter in respect of tax imposed by this Title, the term
'deficiency' means:

(1) The amount by which the tax imposed by this Title exceeds the amount shown as the tax by the
taxpayer upon his return; but the amount so shown on the return shall first be increased by the
amounts previously assessed (or collected without assessment) as a deficiency, and decreased by
the amount previously abated credited, returned, or otherwise in respect of such tax; ..

xxx xxx xxx

(d) Interest on deficiency. — Interest upon the amount determined as deficiency shall be assessed
at the same time as the deficiency and shall be paid upon notice and demand from the
Commissioner of Internal Revenue; and shall be collected as a part of the tax, at the rate of six per
centum per annum from the date prescribed for the payment of the tax (or, if the tax is paid in
installments, from the date prescribed for the payment of the first installment) to the date the
deficiency is assessed; Provided, That the amount that may be collected as interest on deficiency
shall in no case exceed the amount corresponding to a period of three years, the present provision
regarding prescription to the contrary notwithstanding.

The fact is that, as respondent Court of Tax Appeals has stressed, as early as July 15, 1960, the Government
already had in its hands the sum of P221,033.00 representing excess payment. Having been paid and received by
mistake, as petitioner Commissioner subsequently acknowledged, that sum unquestionably belonged to ESSO, and
the Government had the obligation to return it to ESSO That acknowledgment of the erroneous payment came
some four (4) years afterwards in nowise negates or detracts from its actuality. The obligation to return money
mistakenly paid arises from the moment that payment is made, and not from the time that the payee admits the
obligation to reimburse. The obligation of the payee to reimburse an amount paid to him results from the mistake,
not from the payee's confession of the mistake or recognition of the obligation to reimburse. In other words, since
the amount of P221,033.00 belonging to ESSO was already in the hands of the Government as of July, 1960,
although the latter had no right whatever to the amount and indeed was bound to return it to ESSO, it was neither
legally nor logically possible for ESSO thereafter to be considered a debtor of the Government in that amount of
P221,033.00; and whatever other obligation ESSO might subsequently incur in favor of the Government would have
to be reduced by that sum, in respect of which no interest could be charged. To interpret the words of the statute in
such a manner as to subvert these truisms simply can not and should not be countenanced. "Nothing is better
settled than that courts are not to give words a meaning which would lead to absurd or unreasonable
consequences. That is a principle that goes back to In re Allen (2 Phil. 630) decided on October 29, 1903, where it
was held that a literal interpretation is to be rejected if it would be unjust or lead to absurd results." 6 "Statutes should
receive a sensible construction, such as will give effect to the legislative intention and so as to avoid an unjust or absurd conclusion." 7

WHEREFORE, the petition for review is DENIED, and the Decision of the Court of Tax Appeals dated October 28, 1967 subject of the petition is AFFIRMED,
without pronouncement as to costs.
G.R. No. L-10858 October 20, 1915

PEDRO M. DUARTE, petitioner,

vs.
WALLER H. DADE, Director of Prisons, respondent.

Sanz, Opisso and Luzuriaga for petitioner.

Attorney-General Avanceña for respondent.

TRENT, J.:

This is an original application in this Supreme Court a writ of habeas corpus. The petitioner, Pedro M. Duarte, was
tried in the first instance over his objection by the court of appeals of the Island of Guam on the 1st day of March,
1915, and sentenced to fourteen years eight months and one day of cadena temporal, to the accessory penalties
provided by law, to indemnify the Government of the United states in the sum of $40,944.20, and to the payment of
the costs of the cause for the crime of misappropriation of public funds while postmaster at Guam. The governor of
Guam mitigated the term of imprisonment to ten years and, under an agreement with the Governor-General of the
Philippine Islands, designated Bilibid Prison, in the city of Manila, Philippine Islands, "as the place of the execution
of so much of the sentence as relates to confinement." Subsequent thereto the petitioner was sent to Manila and
turned over to the respondent to be confined in Bilibid Prison, where he now is.

This case presents only two questions. (1) Had the court of appeals of the Island of Guam jurisdiction legally to try
and sentence the petitioner in the manner and form above set forth? (2) Is the respondent authorized to hold the
petitioner in confinement in Bilibid Prison, Philippine Islands? The petitioner insists that both these questions should
be answered in the negative.

During the consideration of this case, it was suggested that this supreme Court has no authority to inquire whether
the court of appeals of Guam had jurisdiction to try the petitioner or not, because Guam and the Philippine Islands
are separate and distinct governmental entities and it is our duty to accept without question the judgments of the
courts of that Island.

Cases are cited from the United States Supreme Court reports in which it is held that state courts have no power to
examine into the regularity of Federal judicial process or judgments of Federal courts. If, for instance, as in the case
of Ableman vs. Booth (21 How., 506, 16 L. ed., 169), a United States marshal makes return to a writ issuing out of a
state court that the petitioner is held on an order of a United States circuit court commissioners; or if, as in
Booth vs.United States (139 Fed., 252; 71 C.C.A., 378), the petitioner is in custody in pursuance of a judgment upon
an indictment, charging him with an offense against the laws of the United States; or if, as in Tarble's case (13 Wall.,
397, 20 L. ed., 597), the person whose discharge is sought is held as an enlisted soldier of the army by an officer of
that army, acting directly under the Constitution and laws of the United States, state courts have no power to go
further in the premises. The return of the writ closes the door to all investigation. If the petitioner would have a
judicial determination of the legality of his detention, he must apply to a Federal court. The reason for this is best
stated in the language used by the court in Tarble's case, where, after reviewing both the other cases cited, it was
said: "State judges and state courts, authorized by laws of their states to issue writs of habeas corpus, have,
undoubtedly, a right to issue the writ in any case where a party is alleged to be illegally confined within their
limits,unless it appear upon his application that he is confined under the authority, or claim and color of the authority,
of the United States, by an officer of that government. If such fact appear upon the application to writ should be
refused. If it does not appear, the judge or court issuing the writ has a right to inquire into the cause of
imprisonment, and ascertain by what authority the person is held within the limits of the state; and it is the duty of
the marshal, or other officer having the custody of the prisoner, to give, by a proper return, information in this
respect."

These cases do not supply a precedent governing the case at bar. The analogy fails in most important respects. The
cases cited are, be it remembered, predicated upon the dual system of government in the United States where two
governmental entities, both supreme in their own spheres of action, have identical territorial jurisdiction. They simply
observe the rule that officers of the one cannot interfere with officers of the other in matters pertaining strictly to the
latter. The governments of Guam and of the Philippine Islands are two separate entities presiding over wholly
separate and distinct territories and neither has any control over the other, but both derive their powers from the
central Government of the United States. Any respect which is given to the official acts of the one government by
the other is, in the absence of constitutional restrictions and legislation by the Congress of the United States, purely
a matter of comity and not of coercion. There is no compelling reason, other than comity, why the courts of this
country should give to judgments of courts of the government of Guam any effect whatever, except in so far as our
laws so direct. And the laws of this country treat judgments emanating from the Island of Guam precisely as it does
judgments from other territories or States of the United States. Section 309 of the Code of Civil Procedure provides
the effect of such a judgment in this country, and section 312 provides that "Any judicial record may be impeached
by evidence of a want of jurisdiction in the court or judicial officer . . .."
The whole purpose of the writ of habeas corpus is to determine if the petitioner is legally held. According to the
record before us, the judgment of the Guam court is the first link in the chain that deprives the petitioners of his
liberty. If we are to determine the legality of his confinement, it seems to us that no valid reason can be assigned for
not examining into the jurisdiction of the Guam court.

This court is authorized to grant writs of habeas corpus. (Sec. 526, C.C.P.) The petitioner is being deprived of his
liberty within its territorial jurisdiction. His detention is not caused by the decree, order, or judgment of any Federal
court of officer. Hence, the jurisdiction of this court is complete. If he can show that his confinement is illegal his
case is good. He is attempting to do this by alleging a want of jurisdiction in the court which rendered judgment
against him. If this is true, then his confinement is strictly illegal, for any detention which starts with a void judgment
is illegal. It is our right and our duty to investigate the jurisdiction of the committing court.

The Island of Guam was occupied by the armed forces of the United States during the late war with Spain. By the
Treaty of Paris, Spain formally ceded the island to the United States. (Art. II.) On December 23, 1898, the President
of the United States issued the following Executive Order: "The Island of Guam, in the Ladrones, is hereby placed
under the control of the Department of the Navy. The Secretary of the Navy will take such steps as may be
necessary to establish the authority of the United States and to give it the necessary protection and government.
(Sgd.) WILLIAM MCKINLEY."

On January 12, 1899, the Secretary of the Navy wrote the following letter:

SIR: 1. The Island of Guam, in the Ladrones, Pacific Ocean, having been, by Executive Order, dated
December 23, 1898 (copy of which is inclosed herewith), made a naval station and placed under the
control of the Department of the navy, you are hereby appointed naval governor of the Island of
Guam, this duty being in addition to your duty as commander of a division of the Asiatic Fleet.

2. In taking control of the government of the Island of Guam, you will particularly assume control
of all crown lands, fortifications and public buildings of the Island, together with such archives as
may be found there.

3. You will, whenever opportunity affords, communicate with the Department, giving such
suggestions as you may deem advisable in reference to the naval, commercial, and civil control, and
the development of the Island.

Very respectfully,

(Sgd.) JOHN D. LONG, Secretary.

On the same date the Secretary of the Navy issued "Instructions for the military commander of the Island of Guam,"
which, in general outline, are of a similar tenor to President McKinley's instructions to the first Philippine
Commission. Portions thereof read as follows:

In performing this duty, the military commander of the United States is enjoined to make known to the
inhabitants of the Island of Guam, that, in succeeding to the sovereignty of Spain, in severing the former
political power, the authority of the United States is to be exerted for the security of the persons and property
of the people of the Island and for the confirmation of all their private rights and relations. It will be the duty
of the military commander to announce and proclaim in the most public manner that we come, not as
invaders or conquerors, but as friends, to protect the natives in their homes, in their employments and in
their personal and religious rights. All persons who, either by active aid or by honest submission, cooperate
with the Government of the United States to give effect to those beneficent purposes, will receive the reward
of its support and protection. All others will be brought within the lawful rule we have assumed, with firmness
if need be, but without severity as far as it may be possible.

Within the absolute domain of naval authority, which necessarily is and must remain supreme in the ceded
territory until the legislation of the United States shall otherwise provide, the municipal laws of the territory, in
respect to private rights and property and the repression of crime are to be considered as continuing in
force, and to be administered by the ordinary tribunals, so far as practicable. The operations of civil and
municipal government are to be performed by such officers as may accept the supremacy of the United
States by taking the oath of allegiance, or by officers chosen as far as may be practicable from the
inhabitants of the Island.

xxx xxx xxx

Finally, it should be the earnest and paramount aim of the naval administration to win the confidence,
respect, and affection of the inhabitants of the Island of Guam by assuring to them in every possible way
that full measure of individual rights and liberties which is the heritage of free peoples, and by proving to
them that the mission of the United States is owner of benevolent assimilation, substituting the mild way of
justice and right for arbitrary rule. In the fulfillment of this high mission, supporting the temperate
administration of affairs for the greatest good of the governed, there must be sedulously maintained the
 strong arm of authority, to repress disturbance and to overcome all obstacles to the bestowal of the
blessings of good and stable government upon the people of the Island of Guam under the free flag of the
United States.

So far as the record shows, neither the President of the United States nor the Secretary of the Navy has issued any
subsequent orders or instructions to the governor of Guam respecting the government of the civil population of that
Island.

If we compare the government of Guam so constituted with the Government existing in the Philippine Islands from
August 13, 1898, until September 1, 1900; or with the government existing in Porto Rico from July 25, 1898, until the
Act of Congress of April 12, 1900 (31 Stat. at L., 77), became effective, we shall find that all three were similarly
governed. In both Porto Rico and the Philippine Islands there was first an entry of the armed forces of the United
States, followed by a resumption of civil government under the supervision and control of military governors who
received their appointments and their instructions from the President of the United States. So that, in discussing the
powers and limitations of the governor of Guam, we may rightly consider as precedent the powers exercised by the
military governors of the Philippine Islands and Porto Rico as to the legality of such governments are put at rest by
the stamp of approval placed upon them both by the legislative and judicial departments of the Federal Government.
In the Organic Act Porto Rico Congress recognized the exercise of legislative powers by the military governor in
section 8 in the following language: "That the laws and ordinances of Porto Rico now in force shall continue in full
force and effect, except as altered, amended or modified hereinafter, or as modified by military orders and decrees
in force when this act shall take effect." Congress approved of and consented to the government established by the
President in the Philippine Islands by the Act of March 2, 1901 (31 Stat. at L., 910), which reads in part as follows:
"All military, civil, and judicial powers necessary to govern the Philippine Islands, acquired from Spain by the treaty
concluded at Paris on the tenth day of December, eighteen hundred and ninety-eight, and at Washington on the
seventh day of November, nineteen hundred, shall, until otherwise provided by Congress, be vested in such person
and persons and shall be exercised in such manner as the President of the United States shall direct, for the
establishment of civil government and for maintaining and protecting the inhabitants of said Islands in the free
enjoyment of their liberty, property, and religion."

Still later, in the Act of July 1, 1902 (32 Stat. at L., 692), Congress again approved of the President's administration
of government in the Philippines.

We quote rather fully from a late decision of the Supreme Court of the United States, owing to its peculiar fitness as
a precedent for the case at bar:

By the ratifications of the treaty of peace, Porto Rico ceased to be subject to the crown of Spain, and
became subject to the legislative power of Congress. But the civil government of the Unites States cannot
extend immediately and of its own force over conquered and ceded territory. Theoretically, Congress might
prepare and enact a scheme of civil government to take effect immediately upon the cession, but,
practically, here always have been delays and always will be. Time is required for a study of the situation,
and for the maturing and enactment of an adequate scheme of civil government. In the meantime, pending
the action of Congress, there is no civil power under our system of government, not even that of the
President as civil executive, which can take the place of the government which has ceased to exist by the
cession. Is it possible that, under such circumstances, there must be an interregnum? We think clearly not.
The authority to govern such ceded territory is found in the laws applicable to conquest and cession. That
authority is the military power, under the control of the President as Commander in chief. In the case of
Cross vs. Harrison (16 How., 164, 14 L. ed., 889), a situation of this kind was referred to in the opinion of the
court, where it is said: "It [the military authority] was the government when the territory was ceded as a
conquest, and it did not cease as a matter of course, or as a necessary consequence of the restoration of
peace. The President might have dissolved it by withdrawing the army and navy officers who administered it,
but he did not do so. Congress could have put an end to it, but that was not done. The right inference from
the inaction of both is that it was meant to be continued until it had been legislatively changed. No
presumption of a contrary intention can be made. Whatever may have been the causes of the delay, it must
be presumed that the delay was consistent with the true policy of the government." (pp. 193, 194.) And see
Leitensdorfer vs. Webb (20 How., 176, 15 L. ed., 891), and opinion of Mr. Justice Gray in
Downes vs. Bidwell (182 U.S., 244, 345, 45 L. ed., 1088, 1128, 21 Sup. Ct. Rep., 770).

The authority of a military government during the period between the cession and the action of Congress,
like the authority of the same government before the cession, is of large, though it may not be of unlimited,
extent. In fact, certain limits, not material here, were put upon it in Dooley vs. United States (182 U.S., 222,
45 L. ed., 1074, 21 Sup. Ct. Rep., 762), ad Lincoln vs. United States (197 U.S., 419, 49 L. ed., 816, 25 Sup.
Ct. Rep., 455), though it was said in the Dooley case, page 234: "We have no doubt, however, that, from the
necessities of the case, the right to administer the government of Porto Rico continued in the military
commander after the ratification of the treaty, and until further action by Congress," — citing
Cross vs.Harrison, supra.

But, whatever may be the limits of the military power, it certainly must include the authority to establish
courts of justice, which are so essential a part of any government. So it seems to have been thought in
Leitensdorfer vs. Webb, supra. With this thought in mind, the military power not only established this
particular court in Porto Rico, but as well a system of courts which took the place of the courts under
 Spanish sovereignty, and were continued by the organic act. The same course was pursued in the
Philippine Islands. (Santiago vs.Nogueras, 214 U.S., 260, 53 L. ed., 989.)

When new Mexico was conquered by the United states, the executive authority of the United States properly
established a provisional government, which ordained laws and instituted a judicial system; all of which continued in
force after the termination of the war, and until modified by the direct legislation of Congress, or by the territorial
government established by authority of Congress. In Leitensdorfer vs. Webb (20 How., 176, 178) the Supreme
Court of the United States, in speaking of the military government thus established, said:

Accordingly we find that there was ordained by the provincial government a judicial system, which created a
superior or appellant court, constituted of three judges; the circuits courts, in which the laws were to be
administered by the judges of the superior or appellate court, in the circuits to which they should be
respectively assigned. By the same authority the jurisdiction of the circuit courts to be held in the several
counties was declared to embrace, first, all criminal cases that shall not be otherwise provided for by law;
and second, exclusive original jurisdiction in all civil cases which shall not be cognizable before the prefects
and alcaldes. (Vide Laws of New Mexico, Kearney's Code, p. 48.) Of the validity of these ordinances of the
provisional government there is made no question with respect to the period during which the territory was
held by the United States as occupying conqueror, and it would seem to admit of no doubt that during the
period of their valid existence and superseded every previous institution of the vanquished or deposed
political power which was incompatible with them. But it has been contended that whatever may have been
the rights of the occupying conqueror as such, these were all terminated by the termination of the belligerent
attitude of the parties, and that with the close of the contest every institution which had been overthrown or
suspended would be revived and reestablished. The fallacy of this pretension is exposed by the fact that the
territory never was relinquished by the conqueror nor restored to its original condition or allegiance, but was
retained by the occupant until possession was matured into absolute permanent dominion and sovereignty;
and this, too, under the settled purpose of the United States never to relinquish the possession acquired by
arms. We conclude, therefore, that the ordinances and institutions of the provisional government would be
revoked or modified by the United States alone, either by direct legislation on the part of Congress or by that
of the Territorial government in the exercise of powers delegated by Congress.

The above citations and quotations are sufficient to dispel all doubt as to the legality of military governments from
the time a particular territory is acquired by the United States until Congress chooses to legislate for it and the power
of such governments to create courts of justice. Aside from the establishment of judicial machinery by the military
governments of Porto Rico and the Philippine Islands, as referred to in the quotation from Santiago vs. Nogueras,
supra, we find two very notable pieces of legislation in the Philippine Islands promulgated in the form of military
General Orders and which to this day have the force of law and are administered as such by all departments of the
present Civil Government. They are General Orders No. 58, series of 1900, which still constitutes the bulk of our
criminal procedure; and General Orders No. 68, under date of December 18, 1899, making radical changes in the
marriage law, and which is still in effect without material amendment. Hence, we may conclude that the powers of a
military governor to issue orders, decrees, regulations, etc., which have the force of law in the territory over which he
has jurisdiction is beyond question. Therefore, the governor of Guam had power to recognize the courts by his
General Order No. 69 of 1903; No. 89 of 1905; and his Executive General Order No. 158 of 1910.

But it is objected that he had no power to issue the following communication or order:

From: Governor of Guam.

To: The court of appeals, Guam.
SUBJECT: Pedro M. Duarte, charges against.

1. The court of appeals of Guam shall take original jurisdiction in this case.

(Sgd.) W.J. MAXWELL.

It may be admitted that under Executive General Order No. 158 of 1910, which embodies the last reorganization of
the judiciary of the Guam government, original jurisdiction of the crime with which the petitioner was charged was
vested in the "Island court of Guam" and not in the "court of appeals." But while much tress is laid upon the absolute
lack of power on the part of the governor of Guam to issue this order, we are referred to nothing except previous
orders of the governor himself relating to the establishment of courts, to which we have referred above, and to the
ordinary criminal procedure observed in the Island, which is also embodied in an executive order of the governor of
Guam. Certainly, these general orders, deriving their force as law from the governor himself, are liable to repeal by
him at any time and cannot of themselves prevent the governor from trying an accused person in some other
manner. It is fundamental that what legislators have the power to enact they have the power to repeal. In speaking
of the powers of legislative bodies, it is said in Lewis' Southernland on Statutory Construction, section 244: "A state
legislature has a plenary law-making power over all subjects, whether pertaining to persons or things, within its
territorial jurisdiction, either to introduce new laws or repeal the old, unless prohibited expressly or by implication by
the federal constitution or limited or restrained by its own. It cannot bind itself or its successors by enacting
irrepealable laws except when so restrained. Every legislative body may modify or abolish the acts passed by itself
or its predecessors. This power of repeal may be exercised at the same session at which the original act was
passed; and even while a bill is in its progress and before it becomes a law. This legislature cannot bind a future
legislature to a particular mode of repeal. It cannot declare in advance the intent of subsequent legislatures or the
effect of subsequent legislation upon existing statutes.".

These principles must necessarily apply to the military governor of Guam. A military governor is not, of course,
restrained by any laws of the territory which he governs. As to the people within that territory, "the will of the
conqueror is the law." Limitations upon his powers must be looked for in the laws of his own government and the
instructions handed him by his superiors. Therefore, it is in order to determine whether the action of the military
governor of Guam in ordering his court of appeals to take original jurisdiction in the petitioner's case and in denying
him the right of appeal conflict with the constitutions or laws of the United States, or with instructions emanating from
his superiors. The President of the United States and the Secretary of the navy, who are the superiors of the
governor of Guam, are bound to observe the Constitutions and laws of the United States in any instructions they
give to him. It seems proper, therefore, to first determine whether the Constitution and law prohibit the action taken
by the governor of Guam in the petitioner's case. It is now pretty well settled that the Constitution of the United
States does not extend ex proprio vigore to newly acquired possessions of the United States until they are formally
incorporated into what Chief Justice Marshall has called the "American Empire." (Downes vs. Bidwell, 182 U.S.,
244, 276, 45 L. Ed., 1088, 1102.) But in the case cited, Mr. Justice Brown, in announcing the judgment of the court,
intimated that possibly some of its provisions limited the powers of Congress to legislate for such possessions.
Among these he mentioned the prohibition against passing ex post facto laws, laws granting titles of nobility, laws
restricting religious freedom, free speech, and others. If these are restrictions upon the powers of Congress to deal
with newly acquired possessions, there is good reason to suppose that they operate in a similar manner upon the
executive department of the government in its administration of a military government. But, obviously, the action of
the governor of Guam in the Duarte case does not touch any of these points.

The treaty of peace with Spain is a law of the land. (Const., Art. VI.) There are various provisions of this treaty which
the President of the United states, the Secretary of the Navy, and the governor of Guam must recognize and obey.
For instance, Articles IV and XV provide for the entry of Spanish ships and merchandise on the same terms as
American ships and merchandise for a period of ten years. These provisions are now, of course, obsolete. Article
VIII protects private property rights generally, and Article XIII property rights in copyrights and patents, and provides
from the free admission of Spanish scientific, literary, and artistic works for a period of ten years, the latter provision
now being obsolete. Article X provides that the inhabitants of the ceded territories shall be secured in the free
exercise of their religion. All these are restrictions upon the authority of the President of the United States and his
subordinates in their administration of the Guam government, but they do not approach the facts of the petitioner's
case.

In a recent case, the Supreme Court of the United States, in referring to the military government of Porto Rico, said
that the limitations upon the powers of the military governor must be looked for in the instructions given to the
governor by his superiors, which were founded on the "general rules of international law, and from fundamental
principles known wherever the american flag flies." (Ochoa vs. Hernandez y Morales, 230 U.S., 139, 57 L. ed.,
1427.) The Hague Conference Code of 1899 contains much that robs martial law and military government of their
terrors. Assuming that the President of the United States is bound by this international treaty, there is nothing
contained therein which prohibits the actions taken in the petitioner's case.

Chief Justice Marshall said in American Ins. co. vs. Canter (1 Pet., 511, 7 L. ed., 242): "The usage of the world is, if
a nation be not entirely subdued, to consider the holding of conquered territory as a mere military occupation, until
its fate shall be determined at the treaty of peace. If it be ceded by treaty, the acquisition is confirmed, and the
ceded territory becomes a part of the nation to which it is annexed; either on the terms stipulated in the treaty of
cession, or on such as its new master shall impose. On such transfer of territory, it has never been held that the
relations of the inhabitants with each other undergo any change. Their relations with their former sovereign are
dissolved, and new relations are created between them and the government which has acquired their territory. The
same act which transfer their country transfers the allegiance of those who remain in it and the law, which may be
denominated political, is, necessarily, changed; although that which regulates the intercourse and general conduct
of individuals remain in force until altered by the newly created power of the states."

There is no doubt that this correctly states the policy of the United States as is attested by the history of successive
additions to its territory, and may be said to control military government inaugurated by the President of the United
States. But it cannot be said this policy has been violated in the petitioner's case.

If we examine the legislation of Congress relating to Guam, we find that it has to do almost wholly with
appropriations for improvements either of a public or of a military character. There has been an annual appropriation
for the care of lepers, a considerable amount has been allotted to an agricultural experiment station, for the building
of roads, a water supply system, etc. The last two Tariff Acts have applied to the Island of Guam. The Immigration
Act of 1908 was extended to Guam. United States Army transports were authorized to carry passengers and freight
destined to Guam. The government of Guam was directed to keep certain trade statistics. By Act of June 28, 1906,
deeds and other instruments affecting land situated in the District of Columbia or any territory of the United States
may be acknowledged in the Island of Guam before any notary public or judge appointed by the proper authority.
This act and the acts appropriating monies afford some considerable ground for the argument that Congress has
tacitly recognized and approved of the existing government of Guam. By the Act of august 22, 1912 (37 Stat, at L.,
332), Congress decreed: "The Secretary of the Navy is authorized to transfer all lepers of Guam now segregated,
and other cases that may later appear, to the Island of Culion in the Philippines, and to pay the cost of their transfer
and maintenance from ..." (the appropriation included in the Act).
It will be noted that Congress has never exercised its undoubted right to change or alter the form of government
established on the Island of Guam by the executive department of the Federal Government. And none of these acts
limit the power of the governor of Guam to take the action he did in the case of this petitioner.

To the argument that section 1891 of the Revised Statutes of the United States, which extends the Constitution and
laws of the United States not locally inapplicable to all organized territories, it is sufficient to say that Guam is not an
organized territory. Until it becomes one, a blanket extension to it of the Constitution and laws of the United States
by virtue of section 1891 of the Revised Statutes is an academic question.

As a check upon the excesses of a military governor, we must not forget his responsibility to his superiors.
Birkhimer, in his Military Government, has the following to say upon this point: "310. ... Contrary to the very general
belief, it will be found, when attentively considered, that military government, arbitrary though it be in its essential
features, is far from being the mere will of the commanding general to be enforced by him without responsibility,
either directly or through the medium of subordinates who themselves are answerable only to that commander. His
responsibility is both military and civil; the former complete, the latter qualified by circumstances.

311. First, the responsibility to military superiors extends wherever commanders may go. How extensive
soever may be their operations, how far soever conducted from the territory of their own government, they,
and of course their subordinates as well, are never independent of that authority which sent them forth.

Lieber's Instructions for the Government of Armies of the United States in the Field, known in Army circles as
General orders No. 100, 1863, contains much that limits the will of military commanders in directions they ought not
to go, and the governor of Guam is, possibly, bound thereby. But they do not prohibit the action taken by him in the
petitioner's case.

Finally, it may be added that the executive branch of the Federal Government cannot collide with public opinion in its
administration of dependencies without serious consequences. Bryce, in his American Commonwealth (vol., 2,
chap. 78), truly says: "Towering over Presidents and State governors, over Congress and State legislatures, over
conventions and the vast machinery of party, public opinion stand out, in the United States, as the great source of
power, the master of servants who tremble before it."

It is urged that the governor of Guam violated the instructions to him by the Secretary of the Navy under date of July
12, 1899, special stress being laid on the last paragraph of the quotation therefrom which we have inserted above.
In the first place, we are clearly of the opinion that these very general instructions are not opposed to the particular
act complained of, and that, therefore, the governor of Guam did not violate his instructions. But assuming, for the
moment, that his action in the petitioner's case was violative of those instructions, the Secretary of the Navy
specifically ratified the disposition of the Duarte case under date of June 4, 1915, as appears from the somewhat
lengthy cablegram inserted in the record. It will hardly be denied that the Secretary of the Navy could thus ratify an
act of his agent, the governor of Guam.

From the above authorities, it will be observed that the military governor of Guam and his superiors, the Secretary of
the Navy and the President of the United States, are all limited and restricted in the administration of the civil affairs
of the Island of Guam by the Constitution of the United States; by the Treaty of Paris; by international law with
respect to conquered or ceded territory; by the declared policy of the United States with respect to such territories;
by national and international codes of war; and, ultimately, by the judgment which public opinion must pass upon
their administration of the civil government of Guam; and that the governor of Guam is directly and speedily
answerable to his superiors for any ill-advised or arbitrary official act or conduct. These authorities require a
government by the military authorities which will secure to the inhabitants of the territory over which they preside
protection for life, liberty, and property. This is the task set for a military government, but in its accomplishment there
are no instructions as to the procedure which they must observe. Civil governments under military authority will
naturally assume a quite close resemblance to civil government as it exists in the homeland. The whole government
machinery and its methods of doing business will be made to conform to the sovereign's standards of government. If
the administration of justice under the laws of the foreign sovereign is not in harmony with the rest of the newly
organized government, the courts and procedural law are remodeled to the extent that may be necessary. When
these matters are satisfactorily adjusted, the military governor will permit the civil officials appointed by him or
elected by the people with his permission, to administer the new government. With the exception of these
administrative duties retained by himself, he will ordinarily allow the civil authorities to enforce the law and maintain
order according to their best judgment and discretion without hindrance from him. But the military governor has it in
his power to at any time summarily dismiss any such official who incurs his displeasure or to immediately modify or
annul an order or law promulgated by him which does not appear to be accomplishing its purpose. All the power of
the new government comes from him and what he has created he can destroy. His official acts, his decrees or laws
and his administration of justice are not tested by laws of procedure. In observing those substantive principles which
make government tolerable, he may adopt any procedure which will the more speedily gain the desired end.

In the case at bar, if the governor's order to his court of appeals were tested by what is required of lawmakers in
governmental entities of the United States, where the ultimate power resides in the people, who, by written
constitutions, require their lawmakers to mold their laws into certain specific forms; prohibit them from passing
retroactive laws; from enacting local or special laws; it is true that the said order would have to be declared invalid. It
violates all of these rules of lawmaking which are so generally observed throughout the United States. But where in
the authorities we have discussed above is there limitation of this sort upon the lawmaking powers of a military
governor? We have not discovered any such restrictions, and, in the lengthy argument for the petitioner, it seems
that these restrictions are assumed to exist. The fallacy of such argument is apparent. Such restrictions upon
legislative power have never been assumed to exist in the United States. The people have only succeeded in
incorporating these requirements into written constitutions after long and bitter struggles with selfish interests. A
military governor is not obliged to put expressions of his into any particular form in order that they may have the
effect of law. He may, for the sake of convenience, adopt the practice of recording his legislative acts in a numbered
series of formal orders or decrees. But this does not imply that he shall not, if he so desires, inform the people within
his jurisdiction by some other method which may, in his judgment, be more desirable. It is objected that the order to
the court of appeals to try the case is not law. It comes from the same source as General Orders No. 58. We can
conceive of no reason why it has not the same sanction as that general order; and, it being a later expression of the
governor's will, must overrule all previous proclamations, orders, or regulations of the governor to the extent
necessary to give it its full effect.

Nor, indeed, is it the first time in the history of the United States that military governors by a special order have
compelled a defendant to stand trial in a court different from that which would ordinarily take cognizance of his case.
In 1867 Congress enacted what are known as the Reconstruction Acts (14 Stat. at L., 428; 15 Stat. at L., 14),
dividing the States which had participated in the late rebellion into five military districts, each governed by a military
governor. These governors were authorized among other things to "allow local civil tribunals to take jurisdiction of
and to try offenders, or, when in his judgment it may be necessary for the trial of offenders, he shall have power to
organize military commissions or tribunals for that purpose, and all interference under color of State authority with
the exercise of military authority under this act, shall be null and void." These laws were in effect sustained by the
Supreme Court of the United States in White vs. Hart (13 Wall., 646, 20 L. ed., 685); Texas vs. White (7 Wall., 700,
19 L. ed., 227). Birkhimer, in his Military Government, says:

As observed by Chief Justice Chase, the military existed only to prevent illegal violence to persons and
property, and to facilitate the restoration of the States, and this fact district commanders constantly sought to
impress upon the people interested. This appears from their orders, as, for instance, that the military courts
convened under these laws were to be "governed by the rules of evidence prescribed by the laws of the
State in which the case was tried" (Second district, G.O. 18, 1868); that it was the purpose of the
commanding general "not to interfere with the operation of the State laws, as administered by civil tribunals,
except where the remedies thereby afforded are inadequate to secure individuals substantial justice" (First
District, G.O. 24, 1868); that "the trial and punishment of criminals was to be left to the civil authorities so
long as the said authorities are energetic, active, and do justice to the rights of persons and property without
distinction of race or color" (Third District, G.O. 10, 1868). Birkhimer, p. 486.)

The Military Governor of the Philippine Islands issued a general order (No. 22) on June 17, 1899, in which, after
referring to the reestablishment of the civil courts by previous orders, he said: "The jurisdiction of the courts
specified in paragraph 1 of this order, and of other civil courts which may hereafter be reestablished, shall not
extend to and include crimes and offenses committed by either citizens of or persons sojourning within the
Philippine Islands, which are prejudicial to military administration and discipline, except by authority especially
conferred by the military governor."

In General Orders No. 24 [23], issued on June 24, 1899, the Military Governor said: "The provost courts named will
take cognizance of only such civil causes as are referred to them for trial by the authority appointing them, or the
successor to that authority; and their decree and judgments, when approved by that authority, shall be final; . . .."

In General Orders No. 30, of July 22, 1899, which created a civil government for the Island of Negros under military
supervision, it was said with reference to the judiciary of that government: "XIX. The jurisdiction of these courts shall
not extend to nor include crimes and offenses committed by either citizens or persons sojourning within the Island of
Negros which are prejudicial to military administration and discipline, except by authority especially conferred by the
military governor."

By General Orders No. 64, dated December 5, 1899, civil courts were given jurisdiction of "the class of offenses
specified in Rule 12, article 53, of the reformed compilation of provisions of Spanish law as to criminal procedure,
under the usual procedure as to jurisdiction and appeal, excepting only such of these offenses as are, under
provisions of law of the United States, within the jurisdiction of its military or naval courts martial, or are reserved by
the military authorities for trial by other military tribunals; . . .."

In his general orders No. 64, dated August 10, 1900, the military governor said: "I. During the existence of military
government in these Islands the duty devolves upon the military authorities to protect all persons in their rights of
person and property, to suppress insurrection, disorder and violence and to punish, or cause to be punished, all
disturbers of the public peace, and criminals. To this end local civil tribunals, where the same have been
reconstituted, may take cognizance of and try offenses within their jurisdiction, or, when in their judgment it may be
expedient, the Department Commanders may cause such offenses to be brought to trial before duly constituted
military commissions or provost courts; . . .."l awphil.net

II. Criminal cases arising within the city of Manila and lawfully cognizable by the civil courts of the Province
of Manila, will be reserved for trial by military commission only by authority of these headquarters; . . ..
In all these general orders, it will be noted that the right is asserted to remove any particular case from the court
which would have jurisdiction under the general orders in question, as a matter of expediency, if the military
governor deemed it necessary. If time and opportunity were available to inspect the records of the military
government of the Philippine Islands, no doubt letters or communications of precisely the same nature as the one
directed by the governor of Guam to his court of appeals could be found, taking from a court of original jurisdiction a
particular case and causing it to be tried by some other court.

Some discussion has been indulged in of the deprivation of the defendant's right to appear before the court of
appeals as an appellant from the judgment of the inferior court, the "island court of Guam." In McKane vs. Durston
(153 U.S., 684, 38 L. ed., 866) it was said: "An appeal from a judgment of conviction is not a matter of absolute
right, independently of constitutional or statutory provisions allowing such appeal. A review by an appellate court of
the final judgment in a criminal case, however grave the offense of which the accused is convicted, was not at
common law and is not now a necessary element of due process of law. It is wholly within the discretion of the state
to allow or not to allow such a review. A citation of authorities upon the point is unnecessary."

This case has been frequently affirmed by the Supreme Court of the United States and state courts, and has been
approved by noted constitutional writers, and is, without doubt, the accepted doctrine on the point. Duarte had no
inherent right, as seems to be argued by his counsel, to have his sentence reviewed by an appellate court of the
Island of Guam.

Finally, it is urged that the respondent, the warden of Bilibid, has no legal authority to hold the petitioner. We
presume that this objection is based upon the lack of authority of the Governor-General of the Philippine Islands to
enter into a contract or agreement with the governor of Guam to keep Guam convicts in Bilibid Prison at Manila.
Upon this point, we think it sufficient to quote from ex parte Karstendick (93 U.S., 396, 23 L. ed., 889). In this case, a
Federal prisoner was sentenced to imprisonment in the State penitentiary of West Virginia. The court said: "It is
further insisted, on behalf of the petitioner, that the legislature of the State of West Virginia has not given its consent
to the use of the penitentiary of the State by the United States for the punishment of their criminals, and that for this
reason the order for his confinement there is void. The petitioner is actually confined in the penitentiary, and neither
the state nor its officers object. Congress has authorized imprisonment, as a punishment for crimes against the
United States, in the State prisons. So far as the United States can do so, they have made the penitentiary at
Moundsville a penitentiary of the United States, and the State officers having charge of it their agents to enforce the
sentences of imprisonments passed by their courts. The question is not now whether the state shall submit to this
use of its property by the United States, nor whether these state officers shall be compelled to act as the custodians
of those confined there under the authority of the United States, but whether this petitioner can object if they do not.
We think he cannot. So long as the State permits him to remain in its as the prisoner of the United States, and does
not object to his detention by its officers, he is rightfully detained in custody under a sentence lawfully passed."

Writ denied and prisoner remanded, with costs.

Arellano, C.J., Torres, Carson, and Araullo, JJ., concur.

Separate Opinions

JOHNSON, J., dissenting:

The petition for the writ of habeas corpus in the present case presents the question of the right of the warden of
Bilibid Prison in the Philippine Islands to hold and detain, for a period of ten years, or for any other period, a person
sentenced to be imprisoned by the court of appeals of the Island of Guam. There is no law in force in the Philippine
Islands which authorizes said warden to accept and hold persons sentenced, except those who have been
sentenced by the courts of the Philippine Archipelago. No law has been cited, and it is believed there is none, which
authorizes the government of the Island of Guam to imprison its citizens in prisons outside of its territory.

Conceding for the purposes of the argument only, that the governor of Guam has all the power, military or civil,
defined in the majority opinion; that he can make a law today and unmake it tomorrow; that he can adopt one
procedure today and another to suit his own pleasure tomorrow; that he can create courts with well-defined
jurisdiction today, and other courts with special and limited jurisdiction to suit his convenience, the next day; that,
notwithstanding the fact the he had courts, regularly organized, with prescribed jurisdiction, he can, by a letter
simply, deprive such courts of their jurisdiction and give it to another, for a particular instance, yet, nevertheless, no
law has been called to our attention, and diligent search has found none, which authorizes the Government of the
Philippine islands to detain in its prisons persons sentenced by another and separate sovereign. Neither has nay
law or regulation been found which authorizes the governor of the Island of Guam to have the citizens of his realm
imprisoned in a foreign country. If he can contract with one sovereign to detain his prisoners, without express legal
authority, then he can arrange with another. The Congress of the United States thought it necessary to have a law
regulating the question of the imprisonment of prisoners in jail or penitentiaries, other than those expressly provided
for. (Sec. 5540, 5541, 5542, and 5546 of the Revised Statutes of the United States.)

No contention is made that section 5546 of the Revised Statutes of the United States is applicable to the Island of
Guam; and even granting that it is, no contention is made that the Attorney-General of the United States has
designated the penitentiary of the Philippine Islands as the place for the detention of citizens of the Island of Guam,
who have been sentenced by the courts of said island.

An imprisonment at a place and in a prison not authorized by law is illegal. (In re Mills, 135 U.S., 263.)

G. R. No. L-41001 September 30, 1976

MANILA LODGE NO. 761, BENEVOLENT AND PROTECTIVE ORDER OF THE ELKS, INC., petitioner,
vs.
THE HONORABLE COURT OF APPEALS, CITY OF MANILA, and TARLAC DEVELOPMENT
CORPORATION, respondents.

No. L-41012 September 30, 1976

TARLAC DEVELOPMENT CORPORATION, petitioner,

vs.
HONORABLE COURT OF APPEALS, CITY OF MANILA, LODGE NO. 761, BENEVOLENT AND PROTECTIVE
ORDER OF ELKS, INC., respondents.

CASTRO, C.J.: têñ.£îhqwâ£

STATEMENT OF THE CASE AND STATEMENTOF THE FACTS

These two cases are petitions on certiorari to review the decision dated June 30, 1975 of the Court of Appeals in
CA-G.R. No. 51590-R entitled "Tarlac Development Corporation vs. City of Manila, and Manila Lodge No. 761,
Benevolent and Protective Order of Elks, Inc.," affirming the trial court's finding in Civil Case No. 83009 that the
property subject of the decision a quo is a "public park or plaza."

On June 26, 1905 the Philippine Commission enacted Act No. l360 which authorized the City of Manila to reclaim a
portion of Manila Bay. The reclaimed area was to form part of the Luneta extension. The Act provided that the
reclaimed area "Shall be the property of the City of Manila" and that "the City of Manila is hereby authorized to set
aside a tract of the reclaimed land formed by the Luneta extension x x x at the north end not to exceed five hundred
feet by six hundred feet in size, for a hotel site, and to lease the same, with the approval of the Governor General, to
a responsible person or corporation for a term not exceed ninety-nine years."

Subsequently, the Philippine Commission passed on May 18, 1907 Act No. 1657, amending Act No. 1360, so as to
authorize the City of' Manila either to lease or to sell the portion set aside as a hotel site.

The total area reclaimed was a little over 25 hectares. The City of Manila applied for the registration of the reclaimed
area, and on January 20, 1911, O.C.T. No. 1909 was issued in the name of the City of Manila. The title described
the registered land as "un terreno conocido con el nombre de Luneta Extension, situato en el distrito de la Ermita x
x x." The registration was "subject, however to such of the incumbrances mentioned in Article 39 of said law (Land
Registration Act) as may be subsisting" and "sujeto a las disposiciones y condiciones impuestas en la Ley No. 1360;
y sujeto tambein a los contratos de venta, celebrados y otorgados por la Ciudad de Manila a favor del Army and
Navy Club y la Manila Lodge No. 761, Benevolent and Protective Order of Elks, fechados respectivamente, en 29
de Diciembre de 1908 y 16 de Enero de 1909." 1

On July 13, 1911 the City of Manila, affirming a prior sale dated January 16, 1909 cancelled 5,543.07 square meters
of the reclaimed area to the Manila Lodge No. 761, Benevolent and Protective Order of Elks of the U.S.A. (BPOE,
for short) on the basis of which TCT No. 2195 2 was issued to the latter over the Marcela de terreno que es parte de
la Luneta Extension, Situada en el Distrito le la Ermita ... ." At the back of this title vas annotated document 4608/T-
1635, which in part reads as follows: "que la citada Ciusdad de Manila tendra derecho a su opcion, de recomparar
la expresada propiedad para fines publicos solamete in cualquier tiempo despues de cincuenta anos desde el 13 le
Julio le 1911, precio de la misma propiedad, mas el valor que entonces tengan las mejoras."

For the remainder of the Luneta Extension, that is, after segregating therefrom the portion sold to the Manila Lodge
No. 761, PBOE, a new Certificate of Title No. 2196 3 was issued on July 17, 1911 to the City of Manila.
Manila Lodge No. 761, BPOE, subsequently sold the said 5,543.07 square meters to the Elks Club, Inc., to which
was issued TCT No. 67488. 4 The registered owner, "The Elks Club, Inc.," was later changed by court oder to
"Manila Lodge No. 761, Benevolent and Protective Order of Elks, Inc."

In January 1963 the BPOE. petitioned the Court of First Instance of Manila, Branch IV, for the cancellation of the
right of the City of Manila to repurchase the property This petition was granted on February 15, 1963.

On November 19, 1963 the BPOE sold for the sum of P4,700,000 the land together with all the improvements
thereon to the Tarlac Development Corporation (TDC, for short) which paid P1,700.000 as down payment and
mortgaged to the vendor the same realty to secure the payment of the balance to be paid in quarterly
installments.5At the time of the sale,, there was no annotation of any subsisting lien on the title to the property. On December 12, 1963 TCT No. 73444 was
issued to TDC over the subject land still described as "UNA PARCELA DE TERRENO, que es parte de la Luneta Extension, situada en el Distrito de Ermita ... ."

In June 1964 the City of Manila filed with the Court of First Instance of Manila a petition for the reannotation of its
right to repurchase; the court, after haering, issued an order, dated November 19, 1964, directing the Register of
Deeds of the City of Manila to reannotate in toto the entry regarind the right of the City of Manila to repurchase the
property after fifty years. From this order TDC and BPOE appealed to this Court which on July 31, 1968 affirmed in
G.R. Nos. L-24557 and L-24469 the trial court's order of reannotation, but reserved to TDC the right to bring another
action for the clarification of its rights.

As a consequence of such reservation, TDC filed on April 28, 1971 against the City of Manila and the Manila Lodge
No. 761, BPOE, a complaint, docketed as Civil Case No. 83009 of the Court of First Instance of Manila, containing
three causes of action and praying -

a) On the first cause of action, that the plaintiff TDC be declared to have purchased the parcel of land now in
question with the buildings and improvements thereon from the defendant BPOE for value and in good faith, and
accordingly ordering the cancellation of Entry No. 4608/T-1635 on Transfer Certificate of Title No. 73444 in the
name of the Plaintiff;

b) On the second cause of action, ordering the defendant City of Manila to pay the plaintiff TDC damages in the sum
of note less than one hundred thousand pesos (P100,000.00);

c) On the third cause of action, reserving to the plaintiff TDC the right to recover from the defendant BPOE the
amounts mentioned in par. XVI of the complaint in accordance with Art. 1555 of the Civil Code, in the remote event
that the final judgment in this case should be that the parcel of land now in question is a public park; and

d) For costs, and for such other and further relief as the Court may deem just and equitable. 6

Therein defendant City of Manila, in its answer dated May 19, 1971, admitted all the facts alleged in the first cause
of action except the allegation that TDC purchased said property "for value and in good faith," but denied for lack of
knowledge or information the allegations in the second and third causes of action. As, special and affirmative
defense, the City of Manila claimed that TDC was not a purchaser in good faith for it had actual notice of the City's
right to repurchase which was annotated at the back of the title prior to its cancellation, and that,
assuming arguendo that TDC had no notice of the right to repurchase, it was, nevertheless, under obligation to
investigate inasmuch as its title recites that the property is a part of the Luneta extension. 7

The Manila Lodge No. 761, BPOE, in its answer dated June 7, 1971, admitted having sold the land together with the
improvements thereon for value to therein plaintiff which was in good faith, but denied for lack of knowledge as to
their veracity the allegations under the second cause of action. It furthermore admitted that TDC had paid the
quarterly installments until October l5, 1964 but claimed that the latter failed without justifiable cause to pay the
subsequent installments. It also asserted that it was a seller for value in good faith without having misrepresented or
concealed tacts relative to the title on the property. As counterclaim, Manila Lodge No. 761 (BPOE) sought to
recover the balance of the purchase price plus interest and costs. 8

On June 15, 1971 TDC answered the aforesaid counterclaim, alleging that its refusal to make further payments was
fully justified.9

After due trial the court a quo rendered on July 14, 1972 its decision finding the subject land to be part of the "public
park or plaza" and, therefore, part of the public domain. The court consequently declared that the sale of the subject
land by the City of Manila to Manila Lodge No. 761, BPOE, was null and void; that plaintiff TDC was a purchaser
thereof in g faith and for value from BPOE and can enforce its rights against the latter; and that BPOE is entitled to
recover from the City of Manila whatever consideration it had 'paid the latter. 'The dispositive part of the decision
reads: ñé+.£ªwph!1

WHEREFORE, the Court hereby declares that the parcel of land formerly covered by Transfer
Certificate of Title Nos 2195 and 67488 in the name of BPOE and now by Transfer Certificate of Title
No. 73444 in the name of Tarlac Development Corporation is a public' park or plaza, and,
consequently, instant complaint is dimissed, without pronouncement as to costs.
 In view of the reservation made by plaintiff Tarlac Development Corporation to recover from
defendant BPOE the amounts mentioned in paragraph XVI of the complaint in accordance with
Article 1555 of the Civil Code, the Court makes no pronouncement on this point. 10

From said decision the therein plaintiff TDC as well as the defendant Manila Lodge No. 761, BPOE, appealed to the
Court of Appeals.

In its appeal docketed as CA-G.R. No. 51590-R, the Manila Lodge No. 761, BPOE, avers that the trial court
committed the following errors, namely:

1. In holding that the property subject of the action is not patrimonial property of the City of Manila; and

2. In holding that the Tarlac Development Corporation may recover and enforce its right against the defendant
BPOE. 11

The Tarlac Development Corporation, on the other hand, asserts that the trial court erred:

(1) In finding that the property in question is or was a public park and in consequently nullifying the sale thereof by
the City of Manila to BPOE;

(2) In applying the cases of Municipality of Cavite vs. Rojas, 30 Phil. 602, and Government vs. Cabangis, 53 Phil.
112, to the case at bar; and

(3) In not holding that the plaintiff-appellant is entitled to ,recover damages from the defendant City of Manila. 12

Furthermore, TDC as appellee regarding the second assignment of error raised by BPOE, maintained that it can
recover and enforce its rigth against BPOE in the event that the land in question is declared a public park or part
thereof.13

In its decision promulgated on June 30, 1975, the Court of Appeals concur ed in the findings and conclusions of the
lower court upon the ground that they are supported by he evidence and are in accordance with law, and
accordingly affirmed the lower court's judgment.

Hence, the present petitions for review on certiorari.

G.R. No. L-41001

The Manila Lodge No. 761, BPOE, contends, in its petition for review on certiorari docketed as G.R. No. L-41001,
that the Court of Appeals erred in (1) disregarding the very enabling acts and/or statutes according to which the
subject property was, and still is, patrimonial property of the City of Manila and could therefore be sold and/or
disposed of like any other private property; and (2) in departing from the accepted and usual course of judicial
proceedings when it simply made a general affirmance of the court a quo's findings and conclusions without
bothering to discuss or resolve several vital points stressed by the BPOE in its assigned errrors. 14

G.R. No. L-41012

The Tarlac Development Corporation, in its petition for review on certiorari docketed as G.R. No. L-41012, relies on
the following grounds for the allowance of its petition:

1. that the Court of Appeals did not correctly interpret Act No. 1360, as amended by Act No. 1657, of the Philippine
Commission; and

2. that the Court of Appeals has departed from the accepted and usual course of judicial proceedings in that it did
not make its own findings but simply recited those of the lower court. 15

ISSUES AND ARGUMENTS

FIRST ISSUE

Upon the first issue, both petitioners claim that the property subject of the action, pursuant to the provisions of Act
No. 1360, as amended by Act No. 1657, was patrimonial property of the City of Manila and not a park or plaza.

Arguments of Petitioners

In G.R. No. L-41001, the Manila Lodge No. 761, BPOE, admits that "there appears to be some logic in the
conclusion" of the Court of Appeals that "neither Act No. 1360 nor Act No. 1657 could have meant to supply the City
of Manila the authority to sell the subject property which is located at the south end not the north — of the reclaimed
area." 16 It argues, however, that when Act No. 1360, as amended, authorized the City of Manila to undertake the
construction of the Luneta extension by reclaimed land from the Manila Bay, and declared that the reclaimed land
shall be the "property of the City of Manila," the State expressly granted the ownership thereof to the City of Manila
which. consequently. could enter into transactions involving it; that upon the issuance of O.C.T. No. 1909, there
could he no doubt that the reclaimed area owned by the City was its patrimonial property;" that the south end of the
reclaimed area could not be for public use for. as argued by TDC a street, park or promenade can be property for
public use pursuant to Article 344 of the Spanish Civil Code only when it has already been so constructed or laid
out, and the subject land, at the time it was sold to the Elk's Club, was neither actually constructed as a street, park
or promenade nor laid out as a street, park or promenade;" that even assuming that the subject property was at the
beginning property of public dominion, it was subsequently converted into patrimonial property pursuant to Art. 422
of the Civil Code, inasmuch as it had never been used, red or utilized since it was reclaimed in 1905 for purpose
other than this of an ordinary real estate for sale or lease; that the subject property had never been intended for
public use, is further shown by the fact that it was neither included as a part of the Luneta Park under Plan No. 30 of
the National Planning Commission nor considered a part of the Luneta National Park (now Rizal Park) by
Proclamation No. 234 dated December 19, 1955 of President Ramon Magsaysay or by Proclamation Order No. 274
dated October 4, 1967 of President Ferdinand E. Marcos;" 19 that, such being the case, there is no reason why the
subject property should -not be considered as having been converted into patrimonial property, pursuant to the
ruling in Municipality vs. Roa 7 Phil. 20, inasmuch as the City of Manila has considered it as its patrimonial property
not only bringing it under the operation of the Land Registration Act but also by disposing of it; 20 and that to consider
now the subject property as a public plaza or park would not only impair the obligations of the parties to the contract
of sale (rated July 13, 1911, but also authorize deprivation of property without due process of law.21

G.R. No. L-410112

In L-41012, the petitioner TDC stresses that the principal issue is the interpretation of Act No. 1360, as amended by.
Act No. 1657 of the Philippine Commission, 22 and avers that inasmuch as Section 6 of Act No. 1360, as amended
by Act 1657, provided that the reclamation of the Luneta extension was to be paid for out of the funds of the City of
Manila which was authorized to borrow P350,000 "to be expended in the construction of Luneta Extension," the
reclaimed area became "public land" belonging to the City of Manila that spent for the reclamation, conformably to
the holding in Cabangis,23 and consequently, said land was subject to sale and other disposition; that the Insular
Government itself considered the reclaimed Luneta extension as patrimonial property subject to disposition as
evidenced by the fact that See. 3 of Act 1360 declared that "the land hereby reclaimed shall be the property of the
City of Manila;" that this property cannot be property for public use for according to Article 344 of the Civil Code, the
character of property for public use can only attach to roads and squares that have already been constructed or at
least laid out as such, which conditions did not obtain regarding the subject land, that Sec. 5 of Act 1360 authorized
the City of Manila to lease the northern part of the reclaimed area for hotel purposes; that Act No. 1657 furthermore
authorized the City of Manila to sell the same; 24 that the express statutory authority to lease or sell the northern part
of the reclaimed area cannot be interpreted to mean that the remaining area could not be sold inasmuch as the
purpose of the statute was not merely to confer authority to sell the northern portion but rather to limit the city's
power of disposition thereof, to wit: to prevent disposition of the northern portion for any purpose other than for a
hotel site that the northern and southern ends of the reclaimed area cannot be considered as extension of the
Luneta for they lie beyond the sides of the original Luneta when extended in the direction of the sea, and that is the
reason why the law authorized the sale of the northern portion for hotel purposes, and, for the same reason, it is
implied that the southern portion could likewise be disposed of.26

TDC argues likewise that there are several items of uncontradicted circumstantial evidence which may serve as aids
in construing the legislative intent and which demonstrate that the subject property is patrimonial in nature, to wit: (1)
Exhibits "J" and "J-1", or Plan No. 30 of the National Planning Commission showing the Luneta and its vicinity, do
not include the subject property as part of the Luneta Park; (2) Exhibit "K", which is the plan of the subject property
covered by TCT No. 67488 of BPOE, prepared on November 11, 1963, indicates that said property is not a public
park; (3) Exhibit "T", which is a certified copy of Proclamation No. 234 issued on December 15, 1955 is President
Magsaysay, and Exhibit "U" which is Proclamation Order No. 273 issued on October 4, 1967 by President Marcos,
do not include the subject property in the Luneta Park-, (4) Exhibit "W", which is the location plan of the Luneta
National Park under Proclamations Nos. 234 and 273, further confirms that the subject property is not a public park;
and (5) Exhibit "Y", which is a copy of O.C.T. No. 7333 in the name of the United States of America covering the
land now occupied by the America covering the land now occupied by the American Embassy, the boundaries of
which were delineated by the Philippine Legislature, states that the said land is bounded on the northwest by
properties of the Army and Navy Club (Block No. 321) and the Elks Club (Block No. 321), and this circumstance
shows that even the Philippine Legislature recognized the subject property as private property of the Elks Club. 27

TDC furthermore contends that the City of Manila is estopped from questioning the validity of the sale of the subject
property that it executed on July 13, 1911 to the Manila Lodge No. 761, BPOE, for several reasons, namely: (1) the
City's petition for the reannotation of Entry No. 4608/T-1635 was predicated on the validity of said sale; (2) when the
property was bought by the petitioner TDC it was not a public plaza or park as testified to by both Pedro Cojuanco,
treasurer of TDC, and the surveyor, Manuel Añoneuvo, according to whom the subject property was from all
appearances private property as it was enclosed by fences; (3) the property in question was cadastrally surveyed
and registered as property of the Elks Club, according to Manuel Anonuevo; (4) the property was never used as a
public park, for, since the issuance of T.C.T. No. 2165 on July 17, 1911 in the name of the Manila Lodge NO. 761,
the latter used it as private property, and as early as January 16, 1909 the City of Manila had already executed a
deed of sale over the property in favor of the Manila Lodge No. 761; and (5) the City of Manila has not presented
any evidence to show that the subject property has ever been proclaimed or used as a public park. 28
TDC, moreover, contends that Sec. 60 of Com. Act No. 141 cannot apply to the subject land, for Com. Act No. 141
took effect on December 1, 1936 and at that time the subject land was no longer part of the part of the public
domain. 29

TDC also stresses that its rights as a purchaser in good faith cannot be disregarded, for the mere mention in the
certificate of title that the lot it purchased was "part of the Luneta extension" was not a sufficient warning that tile title
to the City of Manila was invalid; and that although the trial court, in its decision affirmed by the Court of Appeals,
found the TDC -to has been an innocent purchaser for value, the court disregarded the petitioner's rights as such
purchaser that relied on Torrens certificate of title. 30

The Court, continues the petitioner TDC erred in not holding that the latter is entitled to recover from the City of
Manila damages in the amount of P100,000 caused by the City's petition for- reannotation of its right to repurchase.

DISCUSSION AND RESOLUTION OF FIRST ISSUE

It is a cardinal rule of statutory construction that courts must give effect to the general legislative intent that can be
discovered from or is unraveled by the four corners of the statute, 31 and in order to discover said intent, the whole
statute, and not only a particular provision thereof, should be considered.32 It is, therefore, necessary to analyze all
the provisions of Act No. 1360, as amended, in order to unravel the legislative intent.

Act No. 1360 which was enacted by the Philippine Commission on June 26, 1905, as amended by Act No. 1657
enacted on May 18, 1907, authorized the "construction of such rock and timber bulkheads or sea walls as may be
necessary for the making of an extension to the Luneta" (Sec. 1 [a]), and the placing of the material dredged from
the harbor of Manila "inside the bulkheads constructed to inclose the Luneta extension above referred to" (Sec. 1
[a]). It likewise provided that the plan of Architect D. H. Burnham as "a general outline for the extension and
improvement of the Luneta in the City of Manila" be adopted; that "the reclamation from the Bay of Manila of the
land included in said projected Luneta extension... is hereby authorized and the land thereby reclaimed shall be the
property of the City of Manila" (Sec. 3); that "the City of Manila is hereby authorized to set aside a tract of the
reclaimed land formed by the Luneta extension authorized by this Act at the worth end of said tract, not to exceed
five hundred feet by six hundred feet in size, for a hotel site, and to lease the same with the approval of the
Governor General, ... for a term not exceeding ninety-nine years; that "should the Municipal Board ... deem it
advisable it is hereby authorized to advertise for sale to sell said tract of land ... ;" "that said tract shall be used for
hotel purposes as herein prescribed, and shall not be devoted to any other purpose or object whatever;" "that should
the grantee x x x fail to maintain on said tract a first-class hotel x x x then the title to said tract of land sold,
conveyed, and transferred, and shall not be devoted to any other purpose or object whatever;" "that should the
grantee x x x fail to maintain on said tract a first-class hotel x x x then the title to said tract of land sold, conveyed,
and transferred to the grantee shall revert to the City of Manila, and said City of Manila shall thereupon become
entitled to immediate possession of said tract of land" (Sec. 5); that the construction of the rock and timber
bulkheads or sea wall "shall be paid for out of the funds of the City of Manila, but the area to be reclaimed by said
proposed Luneta extension shall be filled, without cost to the City of Manila, with material dredged from Manila Bay
at the expense of the Insular Government" (Sec. 6); and that "the City of Manila is hereby authorized to borrow from
the Insular Government ... the sum of three hundred thousand pesos, to be expended in the construction of Luneta
extension provided for by paragraph (a) of section one hereof" (Sec.7).

The grant made by Act No. 1360 of the reclaimed land to the City of Manila is a grant of "public" nature, the same
having been made to a local political subdivision. Such grants have always been strictly construed against the
grantee.33 One compelling reason given for the strict interpretation of a public grant is that there is in such grant a
gratuitous donation of, public money or resources which results in an unfair advantage to the grantee and for that
reason, the grant should be narrowly restricted in favor of the public.34 This reason for strict interpretation obtains
relative to the aforesaid grant, for, although the City of Manila was to pay for the construction of such work and
timber bulkheads or sea walls as may be necessary for the making of the Luneta extension, the area to be
reclaimed would be filled at the expense of the Insular Government and without cost to the City of Manila, with
material dredged from Manila Bay. Hence, the letter of the statute should be narrowed to exclude maters which if
included would defeat the policy of the legislation.

The reclaimed area, an extension to the Luneta, is declared to be property of the City of Manila. Property, however,
is either of public ownership or of private ownership. 35 What kind of property of the City is the reclaimed land? Is it
of public ownership (dominion) or of private ownership?

We hold that it is of public dominion, intended for public use.

Firstly, if the reclaimed area was granted to the City of Manila as its patrimonial property, the City could, by virtue of
its ownership, dispose of the whole reclaimed area without need of authorization to do so from the lawmaking body.
Thus Article 348 of the Civil Code of Spain provides that "ownership is the right to enjoy and dispose of a thing
without further limitations than those established by law." 36 The right to dispose (jus disponendi) of one's property is
an attribute of ownership. Act No. 1360, as amended, however, provides by necessary implication, that the City of
Manila could not dispose of the reclaimed area without being authorized by the lawmaking body. Thus the statute
provides that "the City of Manila is hereby authorized to set aside a tract ... at the north end, for a hotel site, and to
lease the same ... should the municipal board ... deem it advisable, it is hereby authorized ...to sell said tract of land
... " (Sec. 5). If the reclaimed area were patrimonial property of the City, the latter could dispose of it without need of
the authorization provided by the statute, and the authorization to set aside ... lease ... or sell ... given by the statute
would indeed be superfluous. To so construe the statute s to render the term "authorize," which is repeatedly used
by the statute, superfluous would violate the elementary rule of legal hermeneutics that effect must be given to every
word, clause, and sentence of the statute and that a statute should be so interpreted that no part thereof becomes
inoperative or superfluous. 37 To authorize means to empower, to give a right to act. 38 Act No. 1360 furthermore
qualifies the verb it authorize" with the adverb "hereby," which means "by means of this statue or section," Hence
without the authorization expressly given by Act No. 1360, the City of Manila could not lease or sell even the
northern portion; much less could it dispose of the whole reclaimed area. Consequently, the reclaimed area was
granted to the City of Manila, not as its patrimonial property. At most, only the northern portion reserved as a hotel
site could be said to be patrimonial property for, by express statutory provision it could be disposed of, and
the title thereto would revert to the City should the grantee fail to comply with the terms provided by the statute.

TDC however, contends that the purpose of the authorization provided in Act No. 1360 to lease or sell was really to
limit the City's power of disposition. To sustain such contention is to beg the question. If the purpose of the law was
to limit the City's power of disposition then it is necessarily assumed that the City had already the power to dispose,
for if such power did not exist, how could it be limited? It was precisely Act 1360 that gave the City the power to
dispose for it was hereby authorized by lease of sale. Hence, the City of Manila had no power to dispose of the
reclaimed land had such power not been granted by Act No. 1360, and the purpose of the authorization was to
empower the city to sell or lease the northern part and not, as TDC claims, to limit only the power to dispose.
Moreover, it is presumed that when the lawmaking body enacted the statute, it had full knowledge of prior and
existing laws and legislation on the subject of the statute and acted in accordance or with respect thereto.39 If by
another previous law, the City of Manila could already dispose of the reclaimed area, which it could do if such area
were given to it as its patrimonial property, would it then not be a superfluity for Act No. 1360 to authorize the City to
dispose of the reclaimed land? Neither has petitioner TDC pointed to any other law that authorized the City to do so,
nor have we come across any. What we do know is that if the reclaimed land were patrimonial property, there would
be no need of giving special authorization to the City to dispose of it. Said authorization was given because the
reclaimed land was not intended to be patrimonial property of the City of Manila, and without the express
authorization to dispose of the northern portion, the City could not dispose of even that part.

Secondly, the reclaimed area is an "extension to the Luneta in the City of Manila." 40 If the reclaimed area is an
extension of the Luneta, then it is of the same nature or character as the old Luneta. Anent this matter, it has been
said that a power to extend (or continue an act or business) cannot authorize a transaction that is totally distinct. 41 It
is not disputed that the old Luneta is a public park or plaza and it is so considered by Section 859 of the Revised
Ordinances of the City of Manila.42 Hence the "extension to the Luneta" must be also a public park or plaza and for
public use.

TDC, however, contends that the subject property cannot be considered an extension of the old Luneta because it is
outside of the limits of the old Luneta when extended to the sea. This is a strained interpretation of the term
"extension," for an "extension," it has been held, "signifies enlargement in any direction — in length, breadth, or
circumstance." 43

Thirdly, the reclaimed area was formerly a part of the manila Bay. A bay is nothing more than an inlet of the sea.
Pursuant to Article 1 of the Law of Waters of 1866, bays, roadsteads, coast sea, inlets and shores are parts of the
national domain open to public use. These are also property of public ownership devoted to public use, according to
Article 339 of the Civil Code of Spain.

When the shore or part of the bay is reclaimed, it does not lose its character of being property for public use,
according to Government of the Philippine Islands vs. Cabangis.44 The predecessor of the claimants in this case was
the owner of a big tract of land including the lots in question. From 1896 said land began to wear away due to the
action of the waters of Manila Bay. In 1901 the lots in question became completely submerged in water in ordinary
tides. It remained in such a state until 1912 when the Government undertook the dredging of the Vitas estuary and
dumped the Sand and - silt from estuary on the low lands completely Submerged in water thereby gradually forming
the lots in question. Tomas Cabangis took possession thereof as soon as they were reclaimed hence, the claimants,
his successors in interest, claimed that the lots belonged to them. The trial court found for the claimants and the
Government appealed. This Court held that when the lots became a part of the shore. As they remained in that
condition until reclaimed by the filling done by the Government, they belonged to the public domain. for public use
.4' Hence, a part of the shore, and for that purpose a part of the bay, did not lose its character of being for public use
after it was reclaimed.

Fourthly, Act 1360, as amended, authorized the lease or sale of the northern portion of the reclaimed area as a hotel
sites. The subject property is not that northern portion authorized to be leased or sold; the subject property is the
southern portion. Hence, applying the rule of expresio unius est exlusio alterius, the City of Manila was not
authorized to sell the subject property. The application of this principle of statutory construction becomes the more
imperative in the case at bar inasmuch as not only must the public grant of the reclaimed area to the City of Manila
be, as above stated, strictly construed against the City of Manila, but also because a grant of power to a municipal
corporation, as happens in this case where the city is author ized to lease or sell the northern portion of the Luneta
extension, is strictly limited to such as are expressly or impliedly authorized or necessarily incidental to the
objectives of the corporation.
Fifthly, Article 344 of the Civil Code of Spain provides that to property of public use, in provinces and in towns,
comprises the provincial and town roads, the squares streets fountains, and public waters the promenades, and
public works of general service paid for by such towns or provinces." A park or plaza, such as the extension to the
Luneta, is undoubtedly comprised in said article.

The petitioners, however, argue that, according to said Article 344, in order that the character of property for public
use may be so attached to a plaza, the latter must be actually constructed or at least laid out as such, and since the
subject property was not yet constructed as a plaza or at least laid out as a plaza when it was sold by the City, it
could not be property for public use. It should be noted, however, that properties of provinces and towns for public
use are governed by the same principles as properties of the same character belonging to the public domain.46 In
order to be property of public domain an intention to devote it to public use is sufficient. 47 The, petitioners' contention
is refuted by Manresa himself who said, in his comments", on Article 344, that: ñé+.£ªw ph!1

Las plazas, calles y paseos publicos correspondent sin duda aiguna aldominio publico municipal ),
porque se hallan establecidos sobre suelo municipal y estan destinadas al uso de todos Laurent
presenta tratando de las plazas, una question relativa a si deben conceptuarse como de dominio
publico los lugares vacios libres, que se encuenttan en los Municipios rurales ... Laurent opina
contra Pioudhon que toda vez que estan al servicio de todos pesos lugares, deben considerable
publicos y de dominion publico. Realmente, pala decidir el punto, bastara siempre fijarse en el
destino real y efectivo de los citados lugares, y si este destino entraña un uso comun de todos, no
hay duda que son de dominio publico municipal si no patrimoniales.

It is not necessary, therefore, that a plaza be already constructed of- laid out as a plaza in order that it be
considered property for public use. It is sufficient that it be intended to be such In the case at bar, it has been shown
that the intention of the lawmaking body in giving to the City of Manila the extension to the Luneta was not a grant to
it of patrimonial property but a grant for public use as a plaza.

We have demonstrated ad satietatem that the Luneta extension as intended to be property of the City of Manila for
public use. But, could not said property-later on be converted, as the petitioners contend, to patrimonial property? It
could be. But this Court has already said, in Ignacio vs. The Director of Lands, 49 the executive and possibly the
legislation department that has the authority and the power to make the declaration that said property, is no longer
required for public use, and until such declaration i made the property must continue to form paint of the public
domain. In the case at bar, there has been no such explicit or unequivocal declaration It should be noted,
furthermore, anent this matter, that courts are undoubted v not. primarily called upon, and are not in a position, to
determine whether any public land is still needed for the purposes specified in Article 4 of the Law of Waters .50

Having disposed of the petitioners' principal arguments relative to the main issue, we now pass to the items of
circumstantial evidence which TDC claims may serve as aids in construing the legislative intent in the enactment of
Act No. 1360, as amended. It is noteworthy that all these items of alleged circumstantial evidence are acts far
removed in time from the date of the enactment of Act No.1360 such that they cannot be considered
contemporaneous with its enactment. Moreover, it is not farfetched that this mass of circumstantial evidence might
have been influenced by the antecedent series of invalid acts, to wit: the City's having obtained over the reclaimed
area OCT No. 1909 on January 20,1911; the sale made by the City of the subject property to Manila Lodge No. 761;
and the issuance to the latter of T.C.T. No. 2195. It cannot gainsaid that if the subsequent acts constituting the
circumstantial evidence have been base on, or at least influenced, by those antecedent invalid acts and Torrens
titles S they can hardly be indicative of the intent of the lawmaking body in enacting Act No. 1360 and its
amendatory act.

TDC claims that Exhs. "J," "J-l" "K," "T," "U," "W" and "Y" show that the subject property is not a park.

Exhibits "J" and "J-1," the "Luneta and vicinity showing proposed development" dated May 14, 1949, were prepared
by the National Urban Planning Commission of the Office of the President. It cannot be reasonably expected that
this plan for development of the Luneta should show that the subject property occupied by the ElksClub is a public
park, for it was made 38 years after the sale to the Elks, and after T.C.T. No. 2195 had been issued to Elks. It is to
be assumed that the Office of the President was cognizant of the Torrens title of BPOE. That the subject property
was not included as a part of the Luneta only indicated that the National Urban Planning Commission that made the
plan knew that the subject property was occupied by Elks and that Elks had a Torrens title thereto. But this in no
way proves that the subject property was originally intended to be patrimonial property of the City of Manila or that
the sale to Elks or that the Torrens-title of the latter is valid.

Exhibit "K" is the "Plan of land covered by T.C.T . No ----, as prepared for Tarlac Development Company." It was
made on November 11, 1963 by Felipe F. Cruz, private land surveyor. This surveyor is admittedly a surveyor for
TDC. 51 This plan cannot be expected to show that the subject property is a part of the Luneta Park, for he plan was
made to show the lot that "was to be sold to petitioner." This plan must have also assumed the existence of a valid
title to the land in favor of Elks.

Exhibits "T" and "U" are copies of Presidential Proclamations No. 234 issued on November 15, 1955 and No. 273
issued on October 4, 1967, respectively. The purpose of the said Proclamations was to reserve certain parcels of
land situated in the District of Ermita, City of Manila, for park site purposes. Assuming that the subject property is not
within the boundaries of the reservation, this cannot be interpreted to mean that the subject property was not
originally intended to be for public use or that it has ceased to be such. Conversely, had the subject property been
included in the reservation, it would mean, if it really were private property, that the rights of the owners thereof
would be extinguished, for the reservations was "subject to private rights, if any there be." That the subject property
was not included in the reservation only indicates that the President knew of the existence of the Torrens titles
mentioned above. The failure of the Proclamations to include the subject property in the reservation for park site
could not change the character of the subject property as originally for public use and to form part of the Luneta
Park. What has been said here applies to Exhibits "V", "V-1" to "V-3," and "W" which also refer to the area and
location of the reservation for the Luneta Park.

Exhibit "Y" is a copy of O.C.T. No. 7333 dated November 13, 1935, covering the lot where now stands the American
Embassy [Chancery]. It states that the property is "bounded ... on the Northwest by properties of Army and Navy
Club (Block No.321) and Elks Club (Block No. 321)." Inasmuch as the said bounderies delineated by the Philippine
Legislature in Act No. 4269, the petitioners contend that the Legislature recognized and conceded the existence of
the Elks Club property as a primate property (the property in question) and not as a public park or plaza. This
argument is non sequitur plain and simple Said Original Certificate of Title cannot be considered as an
incontrovertible declaration that the Elks Club was in truth and in fact the owner of such boundary lot. Such mention
as boundary owner is not a means of acquiring title nor can it validate a title that is null and void.

TDC finally claims that the City of Manila is estopped from questioning the validity of the sale it executed on July
13,'1911 conconveying the subject property to the Manila Lodge No. 761, BPOE. This contention cannot be
seriously defended in the light of the doctrine repeatedly enunciated by this Court that the Government is never
estopped by mistakes or errors on the pan of its agents, and estoppel does not apply to a municipal corporation to
validate a contract that is prohibited by law or its against Republic policy, and the sale of July 13, 1911 executed by
the City of Manila to Manila Lodge was certainly a contract prohibited by law. Moreover, estoppel cannot be urged
even if the City of Manila accepted the benefits of such contract of sale and the Manila Lodge No. 761 had
performed its part of the agreement, for to apply the doctrine of estoppel against the City of Manila in this case
would be tantamount to enabling it to do indirectly what it could not do directly. 52

The sale of the subject property executed by the City of Manila to the Manila Lodge No. 761, BPOE, was void and
inexistent for lack of subject matter. 53 It suffered from an incurable defect that could not be ratified either by lapse of
time or by express ratification. The Manila Lodge No. 761 therefore acquired no right by virtue of the said sale.
Hence to consider now the contract inexistent as it always has seen, cannot be, as claimed by the Manila Lodge No.
761, an impairment of the obligations of contracts, for there was it, contemplation of law, no contract at all.

The inexistence of said sale can be set up against anyone who asserts a right arising from it, not only against the
first vendee, the Manila Lodge No. 761, BPOE, but also against all its suceessors, including the TDC which are not
protected the doctrine of bona fide ii purchaser without notice, being claimed by the TDC does not apply where there
is a total absence of title in the vendor, and the good faith of the purchaser TDC cannot create title where none
exists. 55

The so-called sale of the subject property having been executed, the restoration or restitution of what has been
given is order 56

SECOND ISSUE

The second ground alleged in support of the instant petitions for review on certiorari is that the Court of Appeals has
departed from the accepted and usual course of judicial proceedings as to call for an exercise of the power of
supervision. TDC in L-41012, argues that the respondent Court did not make its own findings but simply recited
those of the lower court and made a general affirmance, contrary to the requirements of the Constitution; that the
respondent Court made glaring and patent mistakes in recounting even the copied findings, palpably showing lack
of deliberate consideration of the matters involved, as, for example, when said court said that Act No. 1657
authorized the City of Manila to set aside a portion of the reclaimed land "formed by the Luneta Extension of- to
lease or sell the same for park purposes;" and that respondent Court. further more, did not resolve or dispose of any
of the assigned errors contrary to the mandate of the Judiciary Act..57

The Manila Lodge No. 761, in L-41001, likewise alleges, as one of the reasons warranting review, that the Court of
Appeals departed from the accepted and usual course of Judicial proceedings by simply making a general
affirmance of the court a quo findings without bothering to resolve several vital points mentioned by the BPOE in its
assigned errors. 58

COMMENTS ON SECOND ISSUE

We have shown in our discussion of the first issue that the decision of the trial court is fully in accordance with law.
To follows that when such decision was affirmed by the Court of Appeals, the affirmance was likewise in accordance
with law. Hence, no useful purpose will be served in further discussing the second issue.

CONCLUSION
ACCORDINGLY, the petitions in both G.R. Nos. L-41001 and L-41012 are denied for lack of merit, and the decision
of the Court of Appeals of June 30, 1975, is hereby affirmed, at petitioner's cost.

G.R. No. L-49112 February 2, 1979

LEOVILLO C. AGUSTIN, petitioner,

vs.
HON. ROMEO F. EDU, in his capacity as Land Transportation Commissioner; HON. JUAN PONCE ENRILE,
in his capacity as Minister of National Defense; HON. ALFREDO L. JUINIO, in his capacity as Minister Of
Public Works, Transportation and Communications; and HON: BALTAZAR AQUINO, in his capacity as
Minister of Public Highways, respondents.

Leovillo C. Agustin Law Office for petitioner.

Solicitor General Estelito P. Mendoza, Assistant Solicitor General Ruben E. Agpalo and Solicitor Amado D. Aquino
for respondents.

FERNANDO, J.:

The validity of a letter of Instruction 1 providing for an early seaming device for motor vehicles is assailed in this
prohibition proceeding as being violative of the constitutional guarantee of due process and, insofar as the rules and
regulations for its implementation are concerned, for transgressing the fundamental principle of non- delegation of
legislative power. The Letter of Instruction is stigmatized by petitioner who is possessed of the requisite standing, as
being arbitrary and oppressive. A temporary restraining order as issued and respondents Romeo F. Edu, Land
Transportation Commissioner Juan Ponce Enrile, Minister of National Defense; Alfredo L. Juinio, Minister of Public
Works, Transportation and Communications; and Baltazar Aquino, Minister of Public Highways; were to answer.
That they did in a pleading submitted by Solicitor General Estelito P. Mendoza. 2 Impressed with a highly persuasive
quality, it makes devoid clear that the imputation of a constitutional infirmity is devoid of justification The Letter of
Instruction on is a valid police power measure. Nor could the implementing rules and regulations issued by
respondent Edu be considered as amounting to an exercise of legislative power. Accordingly, the petition must be
dismissed.

The facts are undisputed. The assailed Letter of Instruction No. 229 of President Marcos, issued on December 2,
1974, reads in full: "[Whereas], statistics show that one of the major causes of fatal or serious accidents in land
transportation is the presence of disabled, stalled or parked motor vehicles along streets or highways without any
appropriate early warning device to signal approaching motorists of their presence; [Whereas], the hazards posed
by such obstructions to traffic have been recognized by international bodies concerned with traffic safety, the 1968
Vienna Convention on Road Signs and Signals and the United Nations Organization (U.N.); [Whereas], the said
Vienna Convention which was ratified by the Philippine Government under P.D. No. 207, recommended the
enactment of local legislation for the installation of road safety signs and devices; [Now, therefore, I, Ferdinand E.
Marcos], President of the Philippines, in the interest of safety on all streets and highways, including expressways or
limited access roads, do hereby direct: 1. That all owners, users or drivers of motor vehicles shall have at all times in
their motor vehicles at least one (1) pair of early warning device consisting of triangular, collapsible reflectorized
plates in red and yellow colors at least 15 cms. at the base and 40 cms. at the sides. 2. Whenever any motor vehicle
is stalled or disabled or is parked for thirty (30) minutes or more on any street or highway, including expressways or
limited access roads, the owner, user or driver thereof shall cause the warning device mentioned herein to be
installed at least four meters away to the front and rear of the motor vehicle staged, disabled or parked. 3. The Land
Transportation Commissioner shall cause Reflectorized Triangular Early Warning Devices, as herein described, to
be prepared and issued to registered owners of motor vehicles, except motorcycles and trailers, charging for each
piece not more than 15 % of the acquisition cost. He shall also promulgate such rules and regulations as are
appropriate to effectively implement this order. 4. All hereby concerned shall closely coordinate and take such
measures as are necessary or appropriate to carry into effect then instruction. 3 Thereafter, on November 15, 1976,
it was amended by Letter of Instruction No. 479 in this wise. "Paragraph 3 of Letter of Instruction No. 229 is hereby
amended to read as follows: 3. The Land transportation Commissioner shall require every motor vehicle owner to
procure from any and present at the registration of his vehicle, one pair of a reflectorized early warning device, as d
bed of any brand or make chosen by mid motor vehicle . The Land Transportation Commissioner shall also
promulgate such rule and regulations as are appropriate to effectively implement this order.'" 4 There was issued
accordingly, by respondent Edu, the implementing rules and regulations on December 10, 1976. 5 They were not
enforced as President Marcos on January 25, 1977, ordered a six-month period of suspension insofar as the
installation of early warning device as a pre-registration requirement for motor vehicle was concerned. 6 Then on
June 30, 1978, another Letter of Instruction 7 the lifting of such suspension and directed the immediate
implementation of Letter of Instruction No. 229 as amended. 8 It was not until August 29, 1978 that respondent Edu
issued Memorandum Circular No. 32, worded thus: "In pursuance of Letter of Instruction No. 716, dated June 30,
1978, the implementation of Letter of Instruction No. 229, as amended by Letter of Instructions No. 479, requiring
the use of Early Warning Devices (EWD) on motor vehicle, the following rules and regulations are hereby issued: 1.
LTC Administrative Order No. 1, dated December 10, 1976; shall now be implemented provided that the device may
come from whatever source and that it shall have substantially complied with the EWD specifications contained in
Section 2 of said administrative order; 2. In order to insure that every motor vehicle , except motorcycles, is
equipped with the device, a pair of serially numbered stickers, to be issued free of charge by this Commission, shall
be attached to each EWD. The EWD. serial number shall be indicated on the registration certificate and official
receipt of payment of current registration fees of the motor vehicle concerned. All Orders, Circulars, and Memoranda
in conflict herewith are hereby superseded, This Order shall take effect immediately. 9 It was for immediate
implementation by respondent Alfredo L. Juinio, as Minister of Public Works, transportation, and Communications. 10

Petitioner, after setting forth that he "is the owner of a Volkswagen Beetle Car, Model 13035, already properly
equipped when it came out from the assembly lines with blinking lights fore and aft, which could very well serve as
an early warning device in case of the emergencies mentioned in Letter of Instructions No. 229, as amended, as
well as the implementing rules and regulations in Administrative Order No. 1 issued by the land transportation
Commission," 11 alleged that said Letter of Instruction No. 229, as amended, "clearly violates the provisions and
delegation of police power, [sic] * * *: " For him they are "oppressive, unreasonable, arbitrary, confiscatory, nay
unconstitutional and contrary to the precepts of our compassionate New Society." 12 He contended that they are
"infected with arbitrariness because it is harsh, cruel and unconscionable to the motoring public;" 13 are "one-sided,
onerous and patently illegal and immoral because [they] will make manufacturers and dealers instant millionaires at
the expense of car owners who are compelled to buy a set of the so-called early warning device at the rate of P
56.00 to P72.00 per set." 14 are unlawful and unconstitutional and contrary to the precepts of a compassionate New
Society [as being] compulsory and confiscatory on the part of the motorists who could very well provide a practical
alternative road safety device, or a better substitute to the specified set of EWD's." 15 He therefore prayed for a
judgment both the assailed Letters of Instructions and Memorandum Circular void and unconstitutional and for a
restraining order in the meanwhile.

A resolution to this effect was handed down by this Court on October 19, 1978: "L-49112 (Leovillo C. Agustin v.
Hon. Romeo F. Edu, etc., et al.) — Considering the allegations contained, the issues raised and the arguments
adduced in the petition for prohibition with writ of p prohibitory and/or mandatory injunction, the Court Resolved to
(require) the respondents to file an answer thereto within ton (10) days from notice and not to move to dismiss the
petition. The Court further Resolved to [issue] a [temporary restraining order] effective as of this date and continuing
until otherwise ordered by this Court.16

Two motions for extension were filed by the Office of the Solicitor General and granted. Then on November 15,
1978, he Answer for respondents was submitted. After admitting the factual allegations and stating that they lacked
knowledge or information sufficient to form a belief as to petitioner owning a Volkswagen Beetle car," they
"specifically deny the allegations and stating they lacked knowledge or information sufficient to form a belief as to
petitioner owning a Volkswagen Beetle Car, 17 they specifically deny the allegations in paragraphs X and XI
(including its subparagraphs 1, 2, 3, 4) of Petition to the effect that Letter of Instruction No. 229 as amended by
Letters of Instructions Nos. 479 and 716 as well as Land transportation Commission Administrative Order No. 1 and
its Memorandum Circular No. 32 violates the constitutional provisions on due process of law, equal protection of law
and undue delegation of police power, and that the same are likewise oppressive, arbitrary, confiscatory, one-sided,
onerous, immoral unreasonable and illegal the truth being that said allegations are without legal and factual basis
and for the reasons alleged in the Special and Affirmative Defenses of this Answer."18 Unlike petitioner who
contented himself with a rhetorical recital of his litany of grievances and merely invoked the sacramental phrases of
constitutional litigation, the Answer, in demonstrating that the assailed Letter of Instruction was a valid exercise of
the police power and implementing rules and regulations of respondent Edu not susceptible to the charge that there
was unlawful delegation of legislative power, there was in the portion captioned Special and Affirmative Defenses, a
citation of what respondents believed to be the authoritative decisions of this Tribunal calling for application. They
are Calalang v. Williams, 19 Morfe v. Mutuc, 20 and Edu v. Ericta. 21 Reference was likewise made to the 1968 Vienna
Conventions of the United Nations on road traffic, road signs, and signals, of which the Philippines was a signatory
and which was duly ratified. 22 Solicitor General Mendoza took pains to refute in detail, in language calm and
dispassionate, the vigorous, at times intemperate, accusation of petitioner that the assailed Letter of Instruction and
the implementing rules and regulations cannot survive the test of rigorous scrutiny. To repeat, its highly-persuasive
quality cannot be denied.

This Court thus considered the petition submitted for decision, the issues being clearly joined. As noted at the
outset, it is far from meritorious and must be dismissed.

1. The Letter of Instruction in question was issued in the exercise of the police power. That is conceded by petitioner
and is the main reliance of respondents. It is the submission of the former, however, that while embraced in such a
category, it has offended against the due process and equal protection safeguards of the Constitution, although the
latter point was mentioned only in passing. The broad and expansive scope of the police power which was originally
Identified by Chief Justice Taney of the American Supreme Court in an 1847 decision as "nothing more or less than
the powers of government inherent in every sovereignty" 23 was stressed in the aforementioned case of Edu v.
Ericta thus: "Justice Laurel, in the first leading decision after the Constitution came into force, Calalang v. Williams,
Identified police power with state authority to enact legislation that may interfere with personal liberty or property in
order to promote the general welfare. Persons and property could thus 'be subjected to all kinds of restraints and
burdens in order to we the general comfort, health and prosperity of the state.' Shortly after independence in
1948, Primicias v. Fugoso reiterated the doctrine, such a competence being referred to as 'the power to prescribe
regulations to promote the health, morals, peace, education, good order or safety, and general welfare of the
people. The concept was set forth in negative terms by Justice Malcolm in a pre-Commonwealth decision as 'that
inherent and plenary power in the State which enables it to prohibit all things hurtful to the comfort, safety and
welfare of society. In that sense it could be hardly distinguishable as noted by this Court in Morfe v. Mutuc with the
totality of legislative power. It is in the above sense the greatest and most powerful at. tribute of government. It is, to
quote Justice Malcolm anew, 'the most essential, insistent, and at least table powers, I extending as Justice Holmes
aptly pointed out 'to all the great public needs.' Its scope, ever-expanding to meet the exigencies of the times, even
to anticipate the future where it could be done, provides enough room for an efficient and flexible response to
conditions and circumstances thus assuring the greatest benefits. In the language of Justice Cardozo: 'Needs that
were narrow or parochial in the past may be interwoven in the present with the well-being of the nation. What is
critical or urgent changes with the time.' The police power is thus a dynamic agency, suitably vague and far from
precisely defined, rooted in the conception that men in organizing the state and imposing upon its government
limitations to safeguard constitutional rights did not intend thereby to enable an individual citizen or a group of
citizens to obstruct unreasonably the enactment of such salutary measures calculated to communal peace, safety,
good order, and welfare." 24

2. It was thus a heavy burden to be shouldered by petitioner, compounded by the fact that the particular police
power measure challenged was clearly intended to promote public safety. It would be a rare occurrence indeed for
this Court to invalidate a legislative or executive act of that character. None has been called to our attention, an
indication of its being non-existent. The latest decision in point, Edu v. Ericta, sustained the validity of the Reflector
Law, 25 an enactment conceived with the same end in view. Calalang v. Williams found nothing objectionable in a
statute, the purpose of which was: "To promote safe transit upon, and. avoid obstruction on roads and streets
designated as national roads * * *. 26 As a matter of fact, the first law sought to be nullified after the effectivity of the
1935 Constitution, the National Defense Act, 27 with petitioner failing in his quest, was likewise prompted by the
imperative demands of public safety.

3. The futility of petitioner's effort to nullify both the Letter of Instruction and the implementing rules and regulations
becomes even more apparent considering his failure to lay the necessary factual foundation to rebut the
presumption of validity. So it was held in Ermita-Malate Hotel and Motel Operators Association, Inc. v. City Mayor of
Manila. 28 The rationale was clearly set forth in an excerpt from a decision of Justice Branders of the American
Supreme Court, quoted in the opinion: "The statute here questioned deals with a subject clearly within the scope of
the police power. We are asked to declare it void on the ground that the specific method of regulation prescribed is
unreasonable and hence deprives the plaintiff of due process of law. As underlying questions of fact may condition
the constitutionality of legislation of this character, the presumption of constitutionality must prevail in the absence of
some factual foundation of record in overthrowing the statute. 29

4. Nor did the Solicitor General as he very well could, rely solely on such rebutted presumption of validity. As was
pointed out in his Answer "The President certainly had in his possession the necessary statistical information and
data at the time he issued said letter of instructions, and such factual foundation cannot be defeated by petitioner's
naked assertion that early warning devices 'are not too vital to the prevention of nighttime vehicular accidents'
because allegedly only 390 or 1.5 per cent of the supposed 26,000 motor vehicle accidents that in 1976 involved
rear-end collisions (p. 12 of petition). Petitioner's statistics is not backed up by demonstrable data on record. As
aptly stated by this Honorable Court: Further: "It admits of no doubt therefore that there being a presumption of
validity, the necessity for evidence to rebut it is unavoidable, unless the statute or ordinance is void on its face,
which is not the case here"' * * *. But even as g the verity of petitioner's statistics, is that not reason enough to
require the installation of early warning devices to prevent another 390 rear-end collisions that could mean the death
of 390 or more Filipinos and the deaths that could likewise result from head-on or frontal collisions with stalled
vehicles?" 30 It is quite manifest then that the issuance of such Letter of Instruction is encased in the armor of prior,
careful study by the Executive Department. To set it aside for alleged repugnancy to the due process clause is to
give sanction to conjectural claims that exceeded even the broadest permissible limits of a pleader's well known
penchant for exaggeration.

5. The rather wild and fantastic nature of the charge of oppressiveness of this Letter of Instruction was exposed in
the Answer of the Solicitor General thus: "Such early warning device requirement is not an expensive redundancy,
nor oppressive, for car owners whose cars are already equipped with 1) blinking lights in the fore and aft of said
motor vehicles,' 2) "battery-powered blinking lights inside motor vehicles," 3) "built-in reflectorized tapes on front and
rear bumpers of motor vehicles," or 4) "well-lighted two (2) petroleum lamps (the Kinke) * * * because: Being
universal among the signatory countries to the said 1968 Vienna Conventions, and visible even under adverse
conditions at a distance of at least 400 meters, any motorist from this country or from any part of the world, who
sees a reflectorized rectangular early seaming device installed on the roads, highways or expressways, will
conclude, without thinking, that somewhere along the travelled portion of that road, highway, or expressway, there is
a motor vehicle which is stationary, stalled or disabled which obstructs or endangers passing traffic. On the other
hand, a motorist who sees any of the aforementioned other built in warning devices or the petroleum lamps will not
immediately get adequate advance warning because he will still think what that blinking light is all about. Is it an
emergency vehicle? Is it a law enforcement car? Is it an ambulance? Such confusion or uncertainty in the mind of
the motorist will thus increase, rather than decrease, the danger of collision. 31

6. Nor did the other extravagant assertions of constitutional deficiency go unrefuted in the Answer of the Solicitor
General "There is nothing in the questioned Letter of Instruction No. 229, as amended, or in Administrative Order
No. 1, which requires or compels motor vehicle owners to purchase the early warning device prescribed thereby. All
that is required is for motor vehicle owners concerned like petitioner, to equip their motor vehicles with a pair of this
early warning device in question, procuring or obtaining the same from whatever source. In fact, with a little of
industry and practical ingenuity, motor vehicle owners can even personally make or produce this early warning
device so long as the same substantially conforms with the specifications laid down in said letter of instruction and
administrative order. Accordingly the early warning device requirement can neither be oppressive, onerous,
immoral, nor confiscatory, much less does it make manufacturers and dealers of said devices 'instant millionaires at
the expense of car owners' as petitioner so sweepingly concludes * * *. Petitioner's fear that with the early warning
device requirement 'a more subtle racket may be committed by those called upon to enforce it * * * is an unfounded
speculation. Besides, that unscrupulous officials may try to enforce said requirement in an unreasonable manner or
to an unreasonable degree, does not render the same illegal or immoral where, as in the instant case, the
challenged Letter of Instruction No. 229 and implementing order disclose none of the constitutional defects alleged
against it.32

7 It does appear clearly that petitioner's objection to this Letter of Instruction is not premised on lack of power, the
justification for a finding of unconstitutionality, but on the pessimistic, not to say negative, view he entertains as to its
wisdom. That approach, it put it at its mildest, is distinguished, if that is the appropriate word, by its unorthodoxy. It
bears repeating "that this Court, in the language of Justice Laurel, 'does not pass upon questions of wisdom justice
or expediency of legislation.' As expressed by Justice Tuason: 'It is not the province of the courts to supervise
legislation and keep it within the bounds of propriety and common sense. That is primarily and exclusively a
legislative concern.' There can be no possible objection then to the observation of Justice Montemayor. 'As long as
laws do not violate any Constitutional provision, the Courts merely interpret and apply them regardless of whether or
not they are wise or salutary. For they, according to Justice Labrador, 'are not supposed to override legitimate policy
and * * * never inquire into the wisdom of the law.' It is thus settled, to paraphrase Chief Justice Concepcion in
Gonzales v. Commission on Elections, that only congressional power or competence, not the wisdom of the action
taken, may be the basis for declaring a statute invalid. This is as it ought to be. The principle of separation of powers
has in the main wisely allocated the respective authority of each department and confined its jurisdiction to such a
sphere. There would then be intrusion not allowable under the Constitution if on a matter left to the discretion of a
coordinate branch, the judiciary would substitute its own. If there be adherence to the rule of law, as there ought to
be, the last offender should be courts of justice, to which rightly litigants submit their controversy precisely to
maintain unimpaired the supremacy of legal norms and prescriptions. The attack on the validity of the challenged
provision likewise insofar as there may be objections, even if valid and cogent on is wisdom cannot be sustained. 33

8. The alleged infringement of the fundamental principle of non-delegation of legislative power is equally without any
support well-settled legal doctrines. Had petitioner taken the trouble to acquaint himself with authoritative
pronouncements from this Tribunal, he would not have the temerity to make such an assertion. An exempt from the
aforecited decision of Edu v. Ericta sheds light on the matter: "To avoid the taint of unlawful delegation, there must
be a standard, which implies at the very least that the legislature itself determines matters of principle and lays down
fundamental policy. Otherwise, the charge of complete abdication may be hard to repel A standard thus defines
legislative policy, marks its maps out its boundaries and specifies the public agency to apply it. It indicates the
circumstances under which the legislative command is to be effected. It is the criterion by which legislative purpose
may be carried out. Thereafter, the executive or administrative office designated may in pursuance of the above
guidelines promulgate supplemental rules and regulations. The standard may be either express or implied. If the
former, the non-delegation objection is easily met. The standard though does not have to be spelled out specifically.
It could be implied from the policy and purpose of the act considered as a whole. In the Reflector Law clearly, the
legislative objective is public safety. What is sought to be attained as in Calalang v. Williams is "safe transit upon the
roads.' This is to adhere to the recognition given expression by Justice Laurel in a decision announced not too long
after the Constitution came into force and effect that the principle of non-delegation "has been made to adapt itself
to the complexities of modern governments, giving rise to the adoption, within certain limits, of the principle of
"subordinate legislation" not only in the United States and England but in practically all modern governments.' He
continued: 'Accordingly, with the growing complexity of modern life, the multiplication of the subjects of
governmental regulation, and the increased difficulty of administering the laws, there is a constantly growing
tendency toward the delegation of greater powers by the legislature and toward the approval of the practice by the
courts.' Consistency with the conceptual approach requires the reminder that what is delegated is authority non-
legislative in character, the completeness of the statute when it leaves the hands of Congress being assumed." 34

9. The conclusion reached by this Court that this petition must be dismissed is reinforced by this consideration. The
petition itself quoted these two whereas clauses of the assailed Letter of Instruction: "[Whereas], the hazards posed
by such obstructions to traffic have been recognized by international bodies concerned with traffic safety, the 1968
Vienna Convention on Road Signs and Signals and the United Nations Organization (U.N.); [Whereas], the said
Vionna Convention, which was ratified by the Philippine Government under P.D. No. 207, recommended the
enactment of local legislation for the installation of road safety signs and devices; * * * " 35 It cannot be disputed then
that this Declaration of Principle found in the Constitution possesses relevance: "The Philippines * * * adopts the
generally accepted principles of international law as part of the law of the land * * *." 36 The 1968 Vienna Convention
on Road Signs and Signals is impressed with such a character. It is not for this country to repudiate a commitment
to which it had pledged its word. The concept of Pacta sunt servanda stands in the way of such an attitude, which is,
moreover, at war with the principle of international morality.

10. That is about all that needs be said. The rather court reference to equal protection did not even elicit any attempt
on the Part of Petitioner to substantiate in a manner clear, positive, and categorical why such a casual observation
should be taken seriously. In no case is there a more appropriate occasion for insistence on what was referred to as
"the general rule" in Santiago v. Far Eastern Broadcasting Co., 37 namely, "that the constitutionality of a law wig not
be considered unless the point is specially pleaded, insisted upon, and adequately argued." 38 "Equal protection" is
not a talismanic formula at the mere invocation of which a party to a lawsuit can rightfully expect that success will
crown his efforts. The law is anything but that.

WHEREFORE, this petition is dismissed. The restraining order is lifted. This decision is immediately executory. No
costs