Calalang vs Williams 1940

FACTS:

 Calalang, in his capacity as a private citizen and as a taxpayer of Manila, brought before this
court this petition for a writ of prohibition against the respondents, Chairman of the National
Traffic Commission; Director of Public Works; Acting Secretary of Public Works and
Communications; Mayor of the City of Manila; and Acting Chief of Police of Manila.

 Alleged in the petition that the National Traffic Commission, in its resolution of July 17, 1940,
resolved to recommend to the Director of Public Works and to the Secretary of Public Works
and Communications that animal-drawn vehicles be prohibited from passing along certain
streets at certain times.

 This is in pursuance of the provisions of Commonwealth Act No. 548 which authorizes said
Director of Public Works, with the approval of the Secretary of Public Works and
Communications, to promulgate rules and regulations to regulate and control the use of and
traffic on national roads.

 That as a consequence of the enforcement of such rules and regulations, all animal-drawn
vehicles are not allowed to pass and pick up passengers in the places above-mentioned to the
detriment not only of their owners but of the riding public as well.

 It is contended by the petitioner that Commonwealth Act No. 548 is unconstitutional because it
constitutes an undue delegation of legislative power.

ISSUE:

W/N CA 548 is unconstitutional

W/N the rules and regulations promulgated by the respondents pursuant to the provisions of
Commonwealth Act No. 548 constitute an unlawful interference with legitimate business or trade and
abridge the right to personal liberty and freedom of locomotion

W/N the rules and regulations complained of infringe upon the constitutional precept regarding the
promotion of social justice to insure the well-being and economic security of all the people

RULING:

NO. Petitioner’s contention is untenable.

 ’The true distinction therefore is between the delegation of power to make the law, which
necessarily involves a discretion as to what it shall be, and conferring an authority or discretion
as to its execution, to be exercised under and in pursuance of the law. The first cannot be done;
to the latter no valid objection can be made.’ – Ohio case
  The above provisions of law (Sec. 1, Commonwealth Act 548) do not confer legislative power
upon the Director of Public Works and the Secretary of Public Works and Communications. The
authority therein conferred upon them and under which they promulgated the rules and
regulations now complained of is not to determine what public policy demands but merely to
carry out the legislative policy laid down by the National Assembly in said Act, to wit, "to
promote safe transit upon and avoid obstructions on, roads and streets designated as national
roads by acts of the National Assembly or by executive orders of the President of the
Philippines" and to close them temporarily to any or all classes of traffic "whenever the
condition of the road or the traffic makes such action necessary or advisable in the public
convenience and interest."

 The delegated power, if at all, is merely the ascertainment of the facts and circumstances upon
which the application of said law is to be predicated.

 The rigidity of the theory of separation of governmental powers has been relaxed by permitting
the delegation of greater powers by the legislative and vesting a larger amount of discretion in
administrative and executive officials, not only in the execution of the laws, but also in the
promulgation of certain rules and regulations calculated to promote public interest.

NO.

 Public welfare lies at the bottom of the enactment of said law, and the state in order to promote
the general welfare may interfere with personal liberty, with property, and with business and
occupations. Persons and property may be subjected to all kinds of restraints and burdens, in
order to secure the general comfort, health, and prosperity of the state. To this fundamental
aim of our Government the rights of the individual are subordinated.

NO.

 Social justice is "neither communism, nor despotism, nor atomism, nor anarchy,"
but the humanization of laws and the equalization of social and economic forces
by the State so that justice in its rational and objectively secular conception may
at least be approximated. Social justice means the promotion of the welfare of
all the people, the adoption by the Government of measures calculated to insure
economic stability of all the competent elements of society, through the
maintenance of a proper economic and social equilibrium in the interrelations of
the members of the community, constitutionally, through the adoption of
measures legally justifiable, or extra-constitutionally, through the exercise of
powers underlying the existence of all governments on the time-honored
principle of salus populi est suprema lex.

PETITION IS DENIED.
PASEI vs Torres

FACTS:

 This petition for prohibition with temporary restraining order was filed by PASEI to prohibit and
enjoin the Secretary DOLE and the Administrator of the POEA from enforcing and implementing
the temporary suspension of the recruitment by private employment agencies of Filipino
domestic helpers for Hong Kong and vesting in the DOLE, through the facilities of the POEA, the
task of processing and deploying such workers.

G.R. No. 101279 August 6, 1992

PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS, INC., petitioner,

vs.
HON. RUBEN D. TORRES, as Secretary of the Department of Labor & Employment, and JOSE
N. SARMIENTO, as Administrator of the PHILIPPINE OVERSEAS EMPLOYMENT
ADMINISTRATION, respondents.

De Guzman, Meneses & Associates for petitioner.

GRIÑO-AQUINO, J.:

This petition for prohibition with temporary restraining order was filed by the Philippine Association of
Service Exporters (PASEI, for short), to prohibit and enjoin the Secretary of the Department of Labor
and Employment (DOLE) and the Administrator of the Philippine Overseas Employment
Administration (or POEA) from enforcing and implementing DOLE Department Order No. 16, Series
of 1991 and POEA Memorandum Circulars Nos. 30 and 37, Series of 1991, temporarily suspending
the recruitment by private employment agencies of Filipino domestic helpers for Hong Kong and
vesting in the DOLE, through the facilities of the POEA, the task of processing and deploying such
workers.

PASEI is the largest national organization of private employment and recruitment agencies duly
licensed and authorized by the POEA, to engaged in the business of obtaining overseas
employment for Filipino landbased workers, including domestic helpers.

On June 1, 1991, as a result of published stories regarding the abuses suffered by Filipino
housemaids employed in Hong Kong, DOLE Secretary Ruben D. Torres issued Department Order
No. 16, Series of 1991, temporarily suspending the recruitment by private employment agencies of
"Filipino domestic helpers going to Hong Kong" (p. 30, Rollo). The DOLE itself, through the POEA
took over the business of deploying such Hong Kong-bound workers.

In view of the need to establish mechanisms that will enhance the protection for
Filipino domestic helpers going to Hong Kong, the recruitment of the same by private
employment agencies is hereby temporarily suspended effective 1 July 1991. As
such, the DOLE through the facilities of the Philippine Overseas Employment
 Administration shall take over the processing and deployment of household workers
bound for Hong Kong, subject to guidelines to be issued for said purpose.

In support of this policy, all DOLE Regional Directors and the Bureau of Local
Employment's regional offices are likewise directed to coordinate with the POEA in
maintaining a manpower pool of prospective domestic helpers to Hong Kong on a
regional basis.

For compliance. (Emphasis ours; p. 30, Rollo.)

Pursuant to the above DOLE circular, the POEA issued Memorandum Circular No. 30, Series of
1991, dated July 10, 1991, providing GUIDELINES on the Government processing and deployment
of Filipino domestic helpers to Hong Kong and the accreditation of Hong Kong recruitment agencies
intending to hire Filipino domestic helpers.

Subject: Guidelines on the Temporary Government Processing and Deployment of

Domestic Helpers to Hong Kong.

Pursuant to Department Order No. 16, series of 1991 and in order to operationalize
the temporary government processing and deployment of domestic helpers (DHs) to
Hong Kong resulting from the temporary suspension of recruitment by private
employment agencies for said skill and host market, the following guidelines and
mechanisms shall govern the implementation of said policy.

I. Creation of a joint POEA-OWWA Household Workers Placement Unit (HWPU)

An ad hoc, one stop Household Workers Placement Unit [or HWPU] under the
supervision of the POEA shall take charge of the various operations involved in the
Hong Kong-DH industry segment:

The HWPU shall have the following functions in coordination with appropriate units
and other entities concerned:

1. Negotiations with and Accreditation of Hong Kong Recruitment Agencies

2. Manpower Pooling

3. Worker Training and Briefing

4. Processing and Deployment

5. Welfare Programs

II. Documentary Requirements and Other Conditions for Accreditation of Hong Kong
Recruitment Agencies or Principals

Recruitment agencies in Hong Kong intending to hire Filipino DHs for their employers
may negotiate with the HWPU in Manila directly or through the Philippine Labor
Attache's Office in Hong Kong.

xxx xxx xxx

X. Interim Arrangement

All contracts stamped in Hong Kong as of June 30 shall continue to be processed by

POEA until 31 July 1991 under the name of the Philippine agencies concerned.
Thereafter, all contracts shall be processed with the HWPU.

Recruitment agencies in Hong Kong shall submit to the Philippine Consulate General
in Hong kong a list of their accepted applicants in their pool within the last week of
July. The last day of acceptance shall be July 31 which shall then be the basis of
HWPU in accepting contracts for processing. After the exhaustion of their respective
pools the only source of applicants will be the POEA manpower pool.

For strict compliance of all concerned. (pp. 31-35, Rollo.)

On August 1, 1991, the POEA Administrator also issued Memorandum Circular No. 37, Series of
1991, on the processing of employment contracts of domestic workers for Hong Kong.

TO: All Philippine and Hong Kong Agencies engaged in the recruitment of Domestic
helpers for Hong Kong

Further to Memorandum Circular No. 30, series of 1991 pertaining to the government
processing and deployment of domestic helpers (DHs) to Hong Kong, processing of
employment contracts which have been attested by the Hong Kong Commissioner of
Labor up to 30 June 1991 shall be processed by the POEA Employment Contracts
Processing Branch up to 15 August 1991 only.

Effective 16 August 1991, all Hong Kong recruitment agent/s hiring DHs from the
Philippines shall recruit under the new scheme which requires prior accreditation
which the POEA.

Recruitment agencies in Hong Kong may apply for accreditation at the Office of the
Labor Attache, Philippine Consulate General where a POEA team is posted until 31
August 1991. Thereafter, those who failed to have themselves accredited in Hong
Kong may proceed to the POEA-OWWA Household Workers Placement Unit in
Manila for accreditation before their recruitment and processing of DHs shall be
allowed.

Recruitment agencies in Hong Kong who have some accepted applicants in their
pool after the cut-off period shall submit this list of workers upon accreditation. Only
those DHs in said list will be allowed processing outside of the HWPU manpower
pool.

For strict compliance of all concerned. (Emphasis supplied, p. 36, Rollo.)

On September 2, 1991, the petitioner, PASEI, filed this petition for prohibition to annul the
aforementioned DOLE and POEA circulars and to prohibit their implementation for the following
reasons:

1. that the respondents acted with grave abuse of discretion and/or in excess of their
rule-making authority in issuing said circulars;
 2. that the assailed DOLE and POEA circulars are contrary to the Constitution, are
unreasonable, unfair and oppressive; and

3. that the requirements of publication and filing with the Office of the National
Administrative Register were not complied with.

There is no merit in the first and second grounds of the petition.

Article 36 of the Labor Code grants the Labor Secretary the power to restrict and regulate
recruitment and placement activities.

Art. 36. Regulatory Power. — The Secretary of Labor shall have the power to
restrict and regulate the recruitment and placement activities of all agencies within
the coverage of this title [Regulation of Recruitment and Placement Activities] and is
hereby authorized to issue orders and promulgate rules and regulations to carry out
the objectives and implement the provisions of this title. (Emphasis ours.)

On the other hand, the scope of the regulatory authority of the POEA, which was created by
Executive Order No. 797 on May 1, 1982 to take over the functions of the Overseas Employment
Development Board, the National Seamen Board, and the overseas employment functions of the
Bureau of Employment Services, is broad and far-ranging for:

1. Among the functions inherited by the POEA from the defunct Bureau of
Employment Services was the power and duty:

"2. To establish and maintain a registration and/or licensing

system to regulate private sector participation in the recruitment and
placement of workers, locally and overseas, . . ." (Art. 15, Labor
Code, Emphasis supplied). (p. 13, Rollo.)

2. It assumed from the defunct Overseas Employment Development Board the power
and duty:

3. To recruit and place workers for overseas employment of Filipino

contract workers on a government to government arrangement and in
such other sectors as policy may dictate . . . (Art. 17, Labor Code.) (p.
13, Rollo.)

3. From the National Seamen Board, the POEA took over:

2. To regulate and supervise the activities of agents or

representatives of shipping companies in the hiring of seamen for
overseas employment; and secure the best possible terms of
employment for contract seamen workers and secure compliance
therewith. (Art. 20, Labor Code.)

The vesture of quasi-legislative and quasi-judicial powers in administrative bodies is not

unconstitutional, unreasonable and oppressive. It has been necessitated by "the growing complexity
of the modern society" (Solid Homes, Inc. vs. Payawal, 177 SCRA 72, 79). More and more
administrative bodies are necessary to help in the regulation of society's ramified activities.
"Specialized in the particular field assigned to them, they can deal with the problems thereof with
more expertise and dispatch than can be expected from the legislature or the courts of justice"
(Ibid.).

It is noteworthy that the assailed circulars do not prohibit the petitioner from engaging in the
recruitment and deployment of Filipino landbased workers for overseas employment. A careful
reading of the challenged administrative issuances discloses that the same fall within the
"administrative and policing powers expressly or by necessary implication conferred" upon the
respondents (People vs. Maceren, 79 SCRA 450). The power to "restrict and regulate conferred by
Article 36 of the Labor Code involves a grant of police power (City of Naga vs. Court of Appeals, 24
SCRA 898). To "restrict" means "to confine, limit or stop" (p. 62, Rollo) and whereas the power to
"regulate" means "the power to protect, foster, promote, preserve, and control with due regard for
the interests, first and foremost, of the public, then of the utility and of its patrons" (Philippine
Communications Satellite Corporation vs. Alcuaz, 180 SCRA 218).

The Solicitor General, in his Comment, aptly observed:

. . . Said Administrative Order [i.e., DOLE Administrative Order No. 16] merely
restricted the scope or area of petitioner's business operations by excluding
therefrom recruitment and deployment of domestic helpers for Hong Kong till after
the establishment of the "mechanisms" that will enhance the protection of Filipino
domestic helpers going to Hong Kong. In fine, other than the recruitment and
deployment of Filipino domestic helpers for Hongkong, petitioner may still deploy
other class of Filipino workers either for Hongkong and other countries and all other
classes of Filipino workers for other countries.

Said administrative issuances, intended to curtail, if not to end, rampant violations of

the rule against excessive collections of placement and documentation fees, travel
fees and other charges committed by private employment agencies recruiting and
deploying domestic helpers to Hongkong. [They are reasonable, valid and justified
under the general welfare clause of the Constitution, since the recruitment and
deployment business, as it is conducted today, is affected with public interest.

xxx xxx xxx

The alleged takeover [of the business of recruiting and placing Filipino domestic
helpers in Hongkong] is merely a remedial measure, and expires after its purpose
shall have been attained. This is evident from the tenor of Administrative Order No.
16 that recruitment of Filipino domestic helpers going to Hongkong by private
employment agencies are hereby "temporarily suspended effective July 1, 1991."

The alleged takeover is limited in scope, being confined to recruitment of domestic

helpers going to Hongkong only.

xxx xxx xxx

. . . the justification for the takeover of the processing and deploying of domestic
helpers for Hongkong resulting from the restriction of the scope of petitioner's
business is confined solely to the unscrupulous practice of private employment
agencies victimizing applicants for employment as domestic helpers for Hongkong
and not the whole recruitment business in the Philippines. (pp. 62-65, Rollo.)
The questioned circulars are therefore a valid exercise of the police power as delegated to the
executive branch of Government.

Nevertheless, they are legally invalid, defective and unenforceable for lack of power publication and
filing in the Office of the National Administrative Register as required in Article 2 of the Civil Code,
Article 5 of the Labor Code and Sections 3(1) and 4, Chapter 2, Book VII of the Administrative Code
of 1987 which provide:

Art. 2. Laws shall take effect after fifteen (15) days following the completion of their
publication in the Official Gazatte, unless it is otherwise provided. . . . (Civil Code.)

Art. 5. Rules and Regulations. — The Department of Labor and other government
agencies charged with the administration and enforcement of this Code or any of its
parts shall promulgate the necessary implementing rules and regulations. Such rules
and regulations shall become effective fifteen (15) days after announcement of their
adoption in newspapers of general circulation. (Emphasis supplied, Labor Code, as
amended.)

Sec. 3. Filing. — (1) Every agency shall file with the University of the Philippines Law
Center, three (3) certified copies of every rule adopted by it. Rules in force on the
date of effectivity of this Code which are not filed within three (3) months shall not
thereafter be the basis of any sanction against any party or persons. (Emphasis
supplied, Chapter 2, Book VII of the Administrative Code of 1987.)

Sec. 4. Effectivity. — In addition to other rule-making requirements provided by law

not inconsistent with this Book, each rule shall become effective fifteen (15) days
from the date of filing as above provided unless a different date is fixed by law, or
specified in the rule in cases of imminent danger to public health, safety and welfare,
the existence of which must be expressed in a statement accompanying the rule.
The agency shall take appropriate measures to make emergency rules known to
persons who may be affected by them. (Emphasis supplied, Chapter 2, Book VII of
the Administrative Code of 1987).

Once, more we advert to our ruling in Tañada vs. Tuvera, 146 SCRA 446 that:

. . . Administrative rules and regulations must also be published if their purpose is to

enforce or implement existing law pursuant also to a valid delegation. (p. 447.)

Interpretative regulations and those merely internal in nature, that is, regulating only
the personnel of the administrative agency and not the public, need not be published.
Neither is publication required of the so-called letters of instructions issued by
administrative superiors concerning the rules or guidelines to be followed by their
subordinates in the performance of their duties. (p. 448.)

We agree that publication must be in full or it is no publication at all since its purpose
is to inform the public of the content of the laws. (p. 448.)

For lack of proper publication, the administrative circulars in question may not be enforced and
implemented.
WHEREFORE, the writ of prohibition is GRANTED. The implementation of DOLE Department Order
No. 16, Series of 1991, and POEA Memorandum Circulars Nos. 30 and 37, Series of 1991, by the
public respondents is hereby SUSPENDED pending compliance with the statutory requirements of
publication and filing under the aforementioned laws of the land.

SO ORDERED.
JMM Promotion and Management Inc vs CA

G.R. No. 120095 August 5, 1996

JMM PROMOTION AND MANAGEMENT, INC., and KARY INTERNATIONAL, INC., petitioner,

vs.
HON. COURT OF APPEALS, HON. MA. NIEVES CONFESSOR, then Secretary of the
Department of Labor and Employment, HON. JOSE BRILLANTES, in his capacity as acting
Secretary of the Department of Labor and Employment and HON. FELICISIMO JOSON, in his
capacity as Administrator of the Philippine Overseas Employment
Administration, respondents.

KAPUNAN, J.:p

The limits of government regulation under the State's police power are once again at the
vortex of the instant controversy. Assailed is the government's power to control deployment
of female entertainers to Japan by requiring an Artist Record Book (ARB) as a precondition
to the processing by the POEA of any contract for overseas employment. By contending that
the right to overseas employment is a property right within the meaning of the Constitution,
petitioners vigorously aver that deprivation thereof allegedly through the onerous
requirement of an ARB violates the due process clause and constitutes an invalid exercise of
the police power.

The factual antecedents are undisputed.

Following the much-publicized death of Maricris Sioson in 1991, former President Corazon
C. Aquino ordered a total ban against the deployment of performing artists to Japan and
other foreign destinations. The ban was, however, rescinded after leaders of the overseas
employment industry promised to extend full support for a program aimed at removing kinks
in the system of deployment. In its place, the government, through the Secretary of Labor
and Employment, subsequently issued Department Order No. 28, creating the Entertainment
Industry Advisory Council (EIAC), which was tasked with issuing guidelines on the training,
testing certification and deployment of performing artists abroad.

Pursuant to the EIAC's recommendations,  the Secretary of Labor, on January 6, 1994,

1

issued Department Order No. 3 establishing various procedures and requirements for
screening performing artists under a new system of training, testing, certification and
deployment of the former. Performing artists successfully hurdling the test, training and
certification requirement were to be issued an Artist's Record Book (ARB), a necessary
prerequisite to processing of any contract of employment by the POEA. Upon request of the
industry, implementation of the process, originally scheduled for April 1, 1994, was moved to
October 1, 1994.

Thereafter, the Department of Labor, following the EIAC's recommendation, issued a series
of orders fine-tuning and implementing the new system. Prominent among these orders were
the following issuances:
 1. Department Order No. 3-A, providing for additional guidelines on the training,
testing, certification and deployment of performing artists.

2. Department Order No. 3-B, pertaining to the Artist Record Book (ARB)
requirement, which could be processed only after the artist could show proof of
academic and skills training and has passed the required tests.

3. Department Order No. 3-E, providing the minimum salary a performing artist ought
to received (not less than US$600.00 for those bound for Japan) and the authorized
deductions therefrom.

4. Department Order No. 3-F, providing for the guidelines on the issuance and use of
the ARB by returning performing artists who, unlike new artists, shall only undergo a
Special Orientation Program (shorter than the basic program) although they must
pass the academic test.

In Civil Case No. 95-72750, the Federation of Entertainment Talent Managers of the
Philippines (FETMOP), on January 27, 1995 filed a class suit assailing these department
orders, principally contending that said orders 1) violated the constitutional right to travel; 2)
abridged existing contracts for employment; and 3) deprived individual artists of their
licenses without due process of law. FETMOP, likewise, averred that the issuance of the
Artist Record Book (ARB) was discriminatory and illegal and "in gross violation of the
constitutional right... to life liberty and property." Said Federation consequently prayed for the
issuance of a writ of preliminary injunction against the aforestated orders.

On February 2, 1992, JMM Promotion and Management, Inc. Kary International, Inc., herein
petitioners, filed a Motion for Intervention in said civil case, which was granted by the trial
court in an Order dated 15 February, 1995.

However, on February 21, 1995, the trial court issued an Order denying petitioners' prayed
for a writ of preliminary injunction and dismissed the complaint.

On appeal from the trial court's Order, respondent court, in CA G.R. SP No. 36713 dismissed
the same. Tracing the circumstances which led to the issuance of the ARB requirement and
the assailed Department Order, respondent court concluded that the issuance constituted a
valid exercise by the state of the police power.

We agree.

The latin maxim salus populi est surprema lex embodies the character of the entire spectrum
of public laws aimed at promoting the general welfare of the people under the State's police
power. As an inherent attribute of sovereignty which virtually "extends to all public
needs,"  this "least limitable"  of governmental powers grants a wide panoply of instruments
2 3

through which the state, as parens patriae gives effect to a host of its regulatory powers.

Describing the nature and scope of the police power, Justice Malcolm, in the early case
of Rubi v. Provincial Board of Mindoro  wrote:
4

"The police power of the State," one court has said... is a power coextensive with
self-protection, and is not inaptly termed "the law of overruling necessity." It may be
said to be that inherent and plenary power in the state which enables it to prohibit all
 things hurtful to the comfort, safety and welfare of society." Carried onward by the
current of legislature, the judiciary rarely attempts to dam the onrushing power of
legislative discretion, provided the purposes of the law do not go beyond the great
principles that mean security for the public welfare or do not arbitrarily interfere with
the right of the individual.
5

Thus, police power concerns government enactments which precisely interfere with personal
liberty or property in order to promote the general welfare or the common good. As the
assailed Department Order enjoys a presumed validity, it follows that the burden rests upon
petitioners to demonstrate that the said order, particularly, its ARB requirement, does not
enhance the public welfare or was exercised arbitrarily or unreasonably.

A thorough review of the facts and circumstances leading to the issuance of the assailed
orders compels us to rule that the Artist Record Book requirement and the questioned
Department Order related to its issuance were issued by the Secretary of Labor pursuant to
a valid exercise of the police power.

In 1984, the Philippines emerged as the largest labor sending country in Asia dwarfing the
labor export of countries with mammoth populations such as India and China. According to
the National Statistics Office, this diaspora was augmented annually by over 450,000
documented and clandestine or illegal (undocumented) workers who left the country for
various destinations abroad, lured by higher salaries, better work opportunities and
sometimes better living conditions.

Of the hundreds of thousands of workers who left the country for greener pastures in the last
few years, women composed slightly close to half of those deployed, constituting 47%
between 1987-1991, exceeding this proportion (58%) by the end of 1991,  the year former
6

President Aquino instituted the ban on deployment of performing artists to Japan and other
countries as a result of the gruesome death of Filipino entertainer Maricris Sioson.

It was during the same period that this Court took judicial notice not only of the trend, but
also of the fact that most of our women, a large number employed as domestic helpers and
entertainers, worked under exploitative conditions "marked by physical and personal
abuse."  Even then, we noted that "[t]he sordid tales of maltreatment suffered by migrant
7

Filipina workers, even rape and various forms of torture, confirmed by testimonies of
returning workers" compelled "urgent government action." 8

Pursuant to the alarming number of reports that a significant number of Filipina performing
artists ended up as prostitutes abroad (many of whom were beaten, drugged and forced into
prostitution), and following the deaths of number of these women, the government began
instituting measures aimed at deploying only those individuals who met set standards which
would qualify them as legitimate performing artists. In spite of these measures, however, a
number of our countrymen have nonetheless fallen victim to unscrupulous recruiters, ending
up as virtual slaves controlled by foreign crime syndicates and forced into jobs other than
those indicated in their employment contracts. Worse, some of our women have been forced
into prostitution.

Thus, after a number of inadequate and failed accreditation schemes, the Secretary of Labor
issued on August 16, 1993, D.O. No. 28, establishing the Entertainment Industry Advisory
Council (EIAC), the policy advisory body of DOLE on entertainment industry matters.  Acting
9

on the recommendations of the said body, the Secretary of Labor, on January 6, 1994,
issued the assailed orders. These orders embodied EIAC's Resolution No. 1, which called
for guidelines on screening, testing and accrediting performing overseas Filipino artists.
Significantly, as the respondent court noted, petitioners were duly represented in the
EIAC,  which gave the recommendations on which the ARB and other requirements were
10

based.

Clearly, the welfare of Filipino performing artists, particularly the women was paramount in
the issuance of Department Order No. 3. Short of a total and absolute ban against the
deployment of performing artists to "high risk" destinations, a measure which would only
drive recruitment further underground, the new scheme at the very least rationalizes the
method of screening performing artists by requiring reasonable educational and artistic skills
from them and limits deployment to only those individuals adequately prepared for the
unpredictable demands of employment as artists abroad. It cannot be gainsaid that this
scheme at least lessens the room for exploitation by unscrupulous individuals and agencies.

Moreover, here or abroad, selection of performing artists is usually accomplished by

auditions, where those deemed unfit are usually weeded out through a process which is
inherently subjective and vulnerable to bias and differences in taste. The ARB requirement
goes one step further, however, attempting to minimize the subjectivity of the process by
defining the minimum skills required from entertainers and performing artists. As the Solicitor
General observed, this should be easily met by experienced artists possessing merely basic
skills. The test are aimed at segregating real artists or performers from those passing
themselves off as such, eager to accept any available job and therefore exposing
themselves to possible exploitation.

As to the other provisions of Department Order No. 3 questioned by petitioners, we see

nothing wrong with the requirements for document and booking confirmation (D.O. 3-C), a
minimum salary scale (D.O. 3-E), or the requirement for registration of returning performers.
The requirement for a venue certificate or other documents evidencing the place and nature
or work allows the government closer monitoring of foreign employers and helps keep our
entertainers away from prostitution fronts and other worksites associated with unsavory,
immoral, illegal or exploitative practices. Parenthetically, none of these issuances appear to
us, by any stretch of the imagination, even remotely unreasonable or arbitrary. They address
a felt need of according greater protection for an oft-exploited segment of our OCW's. They
respond to the industry's demand for clearer and more practicable rules and guidelines.
Many of these provisions were fleshed out following recommendations by, and after
consultations with, the affected sectors and non-government organizations. On the whole,
they are aimed at enhancing the safety and security of entertainers and artists bound for
Japan and other destinations, without stifling the industry's concerns for expansion and
growth.

In any event, apart from the State's police power, the Constitution itself mandates
government to extend the fullest protection to our overseas workers. The basic constitutional
statement on labor, embodied in Section 18 of Article II of the Constitution provides:

Sec. 18. The State affirms labor as a primary social economic force. It shall protect
the rights of workers and promote their welfare.

More emphatically, the social justice provisions on labor of the 1987 Constitution in its first
paragraph states:
 The State shall afford full protection to labor, local and overseas, organized and
unorganized and promote full employment and equality of employment opportunities
for all.

Obviously, protection to labor does not indicate promotion of employment alone. Under the
welfare and social justice provisions of the Constitution, the promotion of full employment,
while desirable, cannot take a backseat to the government's constitutional duty to provide
mechanisms for the protection of our workforce, local or overseas. As this Court explained in
Philippine Association of Service Exporters (PASEI) v. Drilon,  in reference to the recurring
11

problems faced by our overseas workers:

What concerns the Constitution more paramountly is that such an employment be

above all, decent, just, and humane. It is bad enough that the country has to send its
sons and daughters to strange lands because it cannot satisfy their employment
needs at home. Under these circumstances, the Government is duty-adequate
protection, personally and economically, while away from home.

We now go to petitioners' assertion that the police power cannot, nevertheless, abridge the
right of our performing workers to return to work abroad after having earlier qualified under
the old process, because, having previously been accredited, their accreditation became a
"property right," protected by the due process clause. We find this contention untenable.

A profession, trade of calling is a property right within the meaning of our constitutional
guarantees. One cannot be deprived of the right to work and right to make a living because
these rights are property rights, the arbitrary and unwarranted deprivation of which normally
constitutes an actionable wrong. 12

Nevertheless, no right is absolute, and the proper regulation of a profession, calling,

business or trade has always been upheld as a legitimate subject of a valid exercise of the
police power by the state particularly when their conduct affects either the execution of
legitimate governmental functions, the preservation of the State, the public health and
welfare and public morals. According to the maxim, sic utere tuo ut alienum non laedas, it
must of course be within the legitimate range of legislative action to define the mode and
manner in which every one may so use of his own property so as not to pose injury to
himself or others. 13

In any case, where the liberty curtailed affects at most the rights of property, the permissible
scope of regulatory measures is certainly much
wider.  To pretend that licensing or accreditation requirements violates the due process
14

clause is to ignore the settled practice, under the mantle of the police power, of regulating
entry to the practice of various trades or professions. Professionals leaving for abroad are
required to pass rigid written and practical exams before they are deemed fit to practice their
trade. Seamen are required to take tests determining their seamanship. Locally, the
Professional Regulation Commission has began to require previously licensed doctors and
other professionals to furnish documentary proof that they has either re-trained or had
undertaken continuing education courses as a requirement for renewal of their licenses. It is
not claimed that these requirements pose an unwarranted deprivation of a property right
under the due process clause. So long as professionals and other workers meet reasonable
regulatory standards no such deprivation exists.

Finally, it is a futile gesture on the part of petitioners to invoke the non-impairment clause of
the Constitution to support their argument that the government cannot enact the assailed
regulatory measures because they abridge the freedom to contract. In Philippine Association
of Service Exporters, Inc. vs. Drilon, we held that "[t]he non-impairment clause of the
Constitution... must yield to the loftier purposes targeted by the government."  Equally
15

important, into every contract is read provisions of existing law, and always, a reservation of
the police power for so long as the agreement deals with a subject impressed with the public
welfare.

A last point. Petitioners suggest that the singling out of entertainers and performing artists
under the assailed department orders constitutes class legislation which violates the equal
protection clause of the Constitution. We do not agree.

The equal protection clause is directed principally against undue favor and individual or class
privilege. It is not intended to prohibit legislation which is limited to the object to which it is
directed or by the territory in which it is to operate. It does not require absolute equality, but
merely that all persons be treated alike under like conditions both as to privileges conferred
and liabilities imposed.  We have held, time and again, that the equal protection clause of
16

the Constitution does not forbid classification for so long as such classification is based on
real and substantial differences having a reasonable relation to the subject of the particular
legislation. 7 If classification is germane to the purpose of the law, concerns all members of
1

the class, and applies equally to present and future conditions, the classification does not
violate the equal protection guarantee.

In the case at bar, the challenged Department Order clearly applies to all performing artists
and entertainers destined for jobs abroad. These orders, we stressed hereinfore, further the
Constitutional mandate requiring government to protect our workforce, particularly those who
may be prone to abuse and exploitation as they are beyond the physical reach of
government regulatory agencies. The tragic incidents must somehow stop, but short of
absolutely curtailing the right of these performers and entertainers to work abroad, the
assailed measures enable our government to assume a measure of control.

WHEREFORE, finding no reversible error in the decision sought to be reviewed, petition is

hereby DENIED.

SO ORDERED.
Florendo vs Enrile

A.M. No. P-92-695 December 7, 1994

CYNTHIA A. FLORENDO, complainant,
vs.
EXEQUIEL ENRILE, respondent.

Edgardo G. Villarin for complainant.

PER CURIAM:

In a sworn letter-complaint filed with the Office of the Court Administrator on 17 March 1992, the
complainant charged the respondent deputy sheriff of the Municipal Trial Court in Cities (MTCC) at
Cabanatuan City with the failure to enforce a writ of demolition notwithstanding his collection and
receipt of P5,200.00. She averred that she was the plaintiff in Civil Cases Nos. 9241 to 9249, all for
ejectment, and that in a joint decision rendered on 22 June 1987 by Branch 2 of the MTCC  the 1

defendants were ordered to vacate the premises and to surrender the possession thereof to the
complainant. The defendants appealed this decision to the Regional Trial Court (RTC) which in a
joint decision of 18 August 1989  affirmed it in toto. On 19 January 1990, the MTCC issued a writ of
2

execution.3

The writ was assigned to the respondent for implementation. In view of the refusal of the defendants
to vacate the premises, the complainant asked for the issuance of a writ of demolition, which the
court granted pursuant to its order of 21 March 1990.  On 27 June 1990, it denied the defendant's
4

motion for extension of time to execute the writ of demolition.  For the service and implementation of
5

the writ of demolition, the respondent asked and received from the complainant and her lawyer the
total sum of P5,200.00 purportedly as sheriff's fee.  The respondent issued no official receipt for this
6

amount. His acknowledgment of the partial payment of P2,700.00 appears on the stationery of the
complainant's lawyer, Atty. Edgardo G. Villarin, while that for the other payment of P500.00 is
handwritten on the stationery of the Office of the City Legal Officer, who is the same Atty. Edgardo
G. Villarin. The other payment of P2,000.00 was by check drawn by the complainant's counsel.

The respondent did not execute the writ of demolition despite the receipt of P5,200.00. The
complainant's lawyer then wrote a letter to the respondent on 8 November 1990 demanding that the
latter implement the writ of demolition or return the aforesaid sum within ten days from receipt of the
letter, otherwise the matter would be brought up to this Court.  Since nothing was done by the
7

respondent, the complainant filed this complaint. She asked that the respondent be dismissed from
the service.

On 25 May 1992, we required the respondent to comment on the letter-complaint.

In his comment (denominated as an answer) dated 16 June 1992, the respondent did not deny the
charge that he collected P5,200.00 as sheriff's fee; however, he specifically denied the allegation
that he did not implement the writ of execution and the writ of demolition. He claimed that he
"returned to the defendants for several times to advice [sic] them to vacate the said place," but since
they did not, he advised the complainant's counsel to file a motion for the issuance of a writ of
demolition. When he received the writ of demolition, he served it on the defendants on 25 July 1990;
the latter requested an extension of thirty days. He then prepared a return of service dated 25 July
1990.  Then, after the expiration of the extended period, he again approached the defendants on 4
8

September 1990 to make them vacate the premises. However, he was threatened by them that if he
would enforce the writ of demolition something would happen, i.e., "magkamatayan muna." He then
prepared the return of service on the said date.  The writ was thus unsatisfied. It appears, however,
9

that these returns dated 25 July 1990 and 4 September 1990 were filed with the MTCC only on 29
May 1991 and 6 June 1991, respectively.

He further claimed that on 8 July 1991, Judge Romeo Mauricio of the MTCC referred to Mr. Arsenio
S. Vicencio, Clerk of Court IV and Ex-Officio Sheriff of the MTCC, the respondent's return of service
of 4 September 1990 for comment.   In his compliance of 15 July 1991,   Mr. Vicencio informed
10 11

Judge Mauricio that the threat on the respondent's life was "real, and it will be very risky for him to
implement" it, and requested that a new deputy sheriff be assigned to enforce the writ. Pursuant to
this request, Judge Mauricio sent a formal request to the Presiding Judge of Branch I of the MTCC
of Cabanatuan City asking that deputy sheriff Teodoro Pineda be assigned to implement the writ of
demolition.12

This case was referred to the Executive Judge of the RTC in Cabanatuan City for investigation,
report and recommendation.

In his Report and Recommendation dated 4 March 1994, but transmitted to this Court only on 6 June
1994, Executive Judge Johnson L. Ballutay narrates the several instances that the case was set for
hearing and the postponements thereof because of the respondent's plea for time to secure the
services of counsel or because of his non-appearance. Judge Ballutay recommends:

PREMISES CONSIDERED, and taking into account the stubborn attitude of the
respondent of not engaging the services of counsel to facilitate the early termination
of the investigation, it is respectfully recommended that in addition to the suspension
for one (1) year without pay and to return to the complainant the P5,200.00, a
suspension without pay for six (6) months be imposed upon the respondent.

In the resolution of 8 August 1994, we referred the Report and Recommendation of Judge Ballutay
to the Office of the Court Administrator for evaluation, report and recommendation.

In its Memorandum of 23 September 1994, the Office of the Court Administrator finds that:

An exhaustive study of the evidence on record shows a considerable amount of

Neglect of Duty on the part of respondent. He should have coordinated with the
counsel of the complainant and/or caused the citation of the defiant defendants for
contempt of court when they resisted the implementation of the writ. Moreover, he
should have requested for additional sheriff and/or police assistance for the proper
and immediate implementation of the subject writs, but he did not. For a long period
time, the complainants have been deprived of their constitutional right to a speedy
administration of justice considering that the Decision sought to be enforced was
issued in 1989 yet, all because of the negligence of herein respondent.

In the case of Active Wood Products, Inc. vs. IAC, 183 SCRA 671, the Court
declares that sheriffs must implement or execute the decision of the court without
delay to prevent injury or damage to the winning party and so as not to prejudice said
party of obtaining speedy justice.
 Respondent did not also conduct himself in an upright and professional manner as
the judiciary code of ethics require [sic], particularly in his getting the amount of
P5,200.00 in installment basis from the respondent.

This Court, speaking through Justice Regalado, in the case of Anonuevo vs.
Pempena (Administrative Matter No. P-93-795) promulgated on July 18, 1994,
enunciates: — "It is an abhorrent and anomalous practice for a sheriff to demand
fees in excess of those lawfully allowed. This Court has emphasized time and again,
that the conduct and behaviour of everyone connected with an office charged with
the dispensation of justice, from the presiding judge to the sheriff down to the lowliest
clerk should be circumscribed with the heavy burden of responsibility. Their conduct
at all times, must be characterized with propriety and decorum, but above all else,
must be above and beyond suspicion," for every employee should be an example of
integrity, uprightness and honesty (Valenton, et al. vs.
Melgar — A.M. No. P-92-698, March 3, 1993, 219 SCRA 372).

It then recommends:

WHEREFORE, considering all the foregoing, it is respectfully recommended to the

Honorable Court that respondent be imposed a FINE equivalent to his one (1) month
salary payable within ten (10) days upon notice, taking into account that (a) he was
not totally remiss in his duties but also exerted efforts to execute the writs; (b) he
even went to the extent of approaching the City Mayor for relocation of the
defendants; and (c) the complainant herself is in conformity to the dismissal of the
complaint; and (2) to RETURN the total amount of P5,200.00 to the complainant,
without interest, within twenty (20) days from notice hereof, with a STERN
WARNING that the repetition of similar offense will be dealt with more severely.

We do not agree with the penalty recommended by Judge Ballutay or the Office of the Court
Administrator. Both are, especially that of the latter, grossly inadequate in the light of the gravity of
the administrative offenses committed by the respondent. Moreover, the former's recommendation of
an additional penalty of suspension for six months on account of the "stubborn attitude of the
respondent of not engaging the services of counsel to facilitate the early termination of the
investigation" is improper. The records disclose that Judge Ballutay was very accommodating to the
parties. No less than fifteen scheduled hearings were cancelled or postponed and despite
admonitions that he would proceed with the hearing regardless of the absence of counsel, he never
did.

Having been delegated by this Court the authority to investigate the case and to submit his report
and recommendation, he should have, upon deliberate failure of the respondent to engage the
services of counsel, allowed the complainant to present ex-parte her evidence and, upon the non-
appearance of the respondent on any of the scheduled dates of hearing, considered him to have
waived the presentation of his evidence. As we see it then, Judge Ballutay is not entirely without
blame for the delay in the termination of the investigation of this case.

It must be stressed that administrative cases involving misconduct, nonfeasance, misfeasance, or

malfeasance in office of officers and employees in the judiciary are of paramount public interest as
the respondents are involved in the administration of justice, a sacred and solemn task. Such cases
must be resolved with reasonable dispatch to clear the name of the innocent and to punish forthwith
the guilty whose stay in office, prolonged by delay, could further tarnish the image of and diminish
the public's faith in the judiciary.
We cannot likewise give weight to the circumstances relied upon by the Office of the Court
Administrator to mitigate the respondent's liability. As hereinafter noted, he is guilty of grave
misconduct, gross dishonesty, serious dereliction or neglect of duty, gross inefficiency or
incompetence, and conduct prejudicial to the best interest of the service. That the complainant "is in
conformity to the dismissal of the complaint" can by no means be considered a mitigating
circumstance as it is offensive to the postulate that a complaint for misconduct, malfeasance, or
misfeasance against a public officer or employee cannot just be withdrawn at any time by the
complainant and that the need to maintain the faith and confidence of the people in the Government
and its agencies and instrumentalities demands the proceedings in such cases should not be made
to depend on the whims and caprices of the complainants who are, in a real sense, only witnesses
therein.   In this case, the conformity of the complainant, found in the motion to dismiss dated 8
13

February 1994   and signed by the counsel for the complainant, is based on the ground that the
14

respondent had already "fully implemented the writ of execution." That motion to dismiss was not,
and correctly so, granted by Judge Ballutay. On the contrary, on 4 March 1994 he made his Report
and Recommendation.

The respondent never denied that he received the sum of P5,200.00 from the complainant in
connection with the writ of demolition. He did not issue any official receipt for the amount received.
At the time the writ of demolition was placed on his hands for implementation, the basic amount that
the complainant had to pay was only P8.00 pursuant to paragraph (g), Section 7, Rule 141 of the
Rules of Court. This was later increased to P100.00 per this Court's en banc resolution of 4
September 1990.   There are, of course, other sheriff's expenses that prevailing parties have to pay
15

for the service or implementation of court processes, or the safeguarding of property levied upon,
attached or seized, including kilometrage, guard's fees, warehousing and similar charges, in an
amount to be estimated by the sheriff. However, the approval of the court thereof is needed and
upon such approval, the amount shall be deposited by the interested party with the clerk of court
and ex-officio sheriff, who shall disburse the same to the deputy sheriff assigned to effect the
process, subject to liquidation within the same period for rendering a return of the process. Any
unspent amount shall be refunded to the party making the deposit. A full report shall be submitted by
the deputy sheriff assigned with his return. 16

In the instant case, the respondent did not make any report on the amount he received from the
complainant nor did he issue an official receipt therefor. It is then obvious that he asked for the
amount not as lawful fees alone but as a consideration for the performance of his duty. Any portion
of the P5,200.00 then in excess of the lawful fees allowed by the Rules of Court is an unlawful
exaction which makes the respondent liable for grave misconduct and gross dishonesty.

The records further disclose that the respondent's returns of service dated 25 July 1990   and 24
17

September 1990   were filed by him only on 29 May 1991 and 6 June 1991, respectively, with the
18

MTCC, which issued the writ of demolition. Either the respondent correctly dated the returns, in
which case there was a deliberate and unreasonable delay in their filing with the court, or he
antedated them to make it appear that he prepared it well within the period provided for by the Rules
of Court. Section 11 of Rule 39 thereof provides that a writ of execution should be returned at any
time not less than ten days nor more than sixty days after its receipt by the sheriff who must set forth
in writing on its back the whole of his proceedings by virtue thereof and file it with the clerk or judge
to be preserved with the other papers in the case.   As the court personnel primarily responsible for
19

the speedy and efficient service of all court processes and writs originating from his court,   it was
20

the respondent's duty to immediately implement the writ of demolition. The Manual for Clerks of
Court   provides:
21

2. Duty of sheriff as to execution of process. — When a writ is placed in the hands of

the sheriff, it is his duty in the absence of instructions, to proceed with reasonable
 celerity and promptness to execute it in accordance with its mandate. . . . He has no
discretion whether to execute it or not.

Section E(4) of the Manual also provides:

4. All sheriffs and deputy sheriffs shall submit a report to the Judge concerned on the
action taken on all writs and processes assigned to them within ten (10) days from
receipt of said process or writ. Said report shall form part of the records of the case.

The duty imposed upon the sheriff to execute the writ is ministerial, not directory. A purely ministerial
act or duty is one which an officer or tribunal performs in a given state of facts, in a prescribed
manner, in obedience to the mandate of the legal authority, without regard to the exercise of his own
judgment upon the propriety or impropriety of the act done.  22

The respondent's explanation that he was not able to implement the writ of demolition because he
was threatened with death by the defendants is unacceptable. If that were true, he should have
either reported it to the MTCC and requested the assistance of other sheriffs or law enforcement
authorities, or filed the appropriate criminal complaint against the defendants who had threatened
him. Instead of doing so, he filed his returns only after several months had lapsed.

For such nonfeasance and misfeasance, the respondent is guilty of serious dereliction or neglect of
duty, gross inefficiency or incompetence, and conduct prejudicial to the best interest of the service.

Time and again, this Court has stressed that the conduct and behavior of everyone connected with
the dispensation of justice from the presiding judge to the lowliest clerk should be circumscribed with
the heavy burden of responsibility. They must at all times not only observe propriety and decorum,
they must also be above suspicion.  23

WHEREFORE, for grave misconduct, gross dishonesty, serious dereliction or neglect of duty, gross
incompetence or inefficiency, and conduct prejudicial to the best interest of the service, respondent
EXEQUIEL ENRILE, Deputy Sheriff of the Municipal Trial Court in Cities of Cabanatuan City, is
ordered DISMISSED from the service with forfeiture of all benefits and with prejudice to re-
employment in any branch of service of the Government, including government-owned or controlled
corporations.

This decision is immediately executory.

SO ORDERED.
Roble Arrastre Inc vs Hon. Villaflor

G.R. No. 128509 August 22, 2006

ROBLE ARRASTRE, INC., Petitioner,

vs.
HON. ALTAGRACIA VILLAFLOR and THE HONORABLE COURT OF APPEALS, Respondents.

DECISION

CHICO-NAZARIO, J.:

Before Us is a Petition for Review on Certiorari, assailing the 7 October 1996 Decision 1 and the 13
February 1997 Resolution2 of the Court of Appeals in CA-G.R. SP No. 40621, which reversed and
set aside the 29 March 1995 Decision 3 of the Regional Trial Court (RTC), Branch XVIII, Hilongos,
Leyte, in Special Civil Action No. H-237.

The Antecedents

Petitioner Roble Arrastre, Inc. is a cargo handling service operator, authorized by the Philippine
Ports Authority (PPA) through Permit No. M92-005 to provide and render arrastre and stevedoring
services at the Municipal Port of Hilongos, Leyte, and on all vessels berthed thereat, from 7
September 1992 to 15 September 1993. 4 For the years 1992 and 1993, petitioner was granted
Business Permits No. 349 and No. 276, respectively, by respondent Altagracia Villaflor as Municipal
Mayor of Hilongos, Leyte. On 14 December 1993, pending final consideration of petitioner’s
application for renewal with the PPA Office, Manila, the PPA through its Port Manager Salvador L.
Reyna of the Tacloban Port Management Office issued a 90-day hold-over authority to petitioner.
Stated therein was the proviso that notwithstanding the 90-day period aforementioned, the authority
shall be deemed ipso facto revoked if an earlier permit/contract for cargo handling services is
granted or sooner withdrawn or cancelled for cause pursuant to PPA Administrative Order No. 10-
81. On 27 January 1994, while the 90-day hold-over authority was in effect, petitioner filed with
respondent mayor an application for the renewal of its Business Permit No. 276. However, the same
was denied.

Aggrieved by the denial, petitioner filed with the RTC, a Petition for Mandamus with Preliminary
Mandatory Injunction5 against respondent mayor, raising the primary ground that the refusal to issue
the business license sought for was a neglect to perform an act which the law enjoins her to do, by
virtue of the office she occupies. According to petitioner, the source of the power of the municipal
mayor to issue licenses is Section 444(b)(3)(iv)6 of Republic Act No. 7160, otherwise known as the
Local Government Code of 1991, which is merely for the purpose of revenue generation and not
regulation, hence, the municipal mayor has no discretion to refuse the issuance of a business
license following the applicant’s payment or satisfaction of the proper license fees. 7 Petitioner further
alleged that it is the PPA which is vested with the discretion to determine whether a party can render
arrastre service in a particular port area.8

In answer thereto, respondent mayor averred, inter alia, that the remedy of mandamus does not lie
as the issuance of the permit sought is not a ministerial function, but one that requires the exercise
of sound judgment and discretion. 9 In denying petitioner’s application, respondent mayor invoked
Municipal Resolution No. 93-27,10 passed by the Sangguniang Bayan of Hilongos, Leyte, on 17
March 1993, which prohibits any party which likewise operates shipping lines plying the route of
Cebu to Hilongos and vice versa, from engaging in arrastre and stevedoring services at the port of
Hilongos.11 Respondent mayor asserted that petitioner is owned and operated by Roble Shipping
Lines, a shipping company that operates along the routes specified in Municipal Resolution No. 93-
27;12 hence, effectively rendering petitioner disqualified from operating an arrastre service
therein.13 Finally, by way of counterclaim, respondent mayor sought moral and exemplary damages,
attorney’s fees and expenses of litigation. 14

On 16 May 1994, petitioner filed a Supplemental Petition, 15 contending that subsequent to the filing
of the Petition for Mandamus with the RTC, it was granted by the PPA a five-year contract 16 to
provide cargo handling and other related services at the Port of Hilongos, Leyte, effective 1 March
1994. The aforesaid contract was indorsed by the District Manager for the Visayas to the Port
Manager of Tacloban. Moreover, petitioner sought to incorporate the five-year contract as an integral
part of its Petition. The Supplemental Petition was admitted by the RTC, in the Order 17 dated 19 July
1994.

On 19 September 1994, the RTC issued a Pre-Trial Order containing the following admitted
stipulations of facts, to wit:

1. That petitioner in 1993 was issued a Mayor’s Permit No. 276 on January 29, 1993, [as] shown by
Annex "B" of the petition;

2. [That petitioner paid] for Business and License Permit for the year 1994 in the amount
of P9,789.48 under Official Receipt No. 7534455-C;

3. [That petitioner procured a] Barangay Clearance. 18

In the same Order, the RTC denied the parties’ motion that the case be submitted on the pleadings
since no judgment on the pleadings could be had as there were controverted issues material to the
case.19

The Ruling of the RTC

The RTC opined that the PPA has the sole authority to grant permits in the operation of cargo
handling services in all Philippine ports, whether public or private. Proceeding therefrom, it ruled that
the refusal of respondent mayor to approve petitioner’s application for renewal of the business
permit was not based on law nor upon her discretion.

The RTC ratiocinated in this wise, thus:

As can be read the resolution is to object to the approval of a five (5) year management contract for
Arrastre and Stevedoring Services in the port of Hilongos, Leyte, applied by the Roble Arrastre, Inc.
with the concomitant reason that the Sangguniang Bayan finds it logical and ethical not to grant any
permit to any group or corporation in the municipal port of Hilongos who are operators of Shipping
Lines flying (sic) the route from Cebu to Hilongos and vice-versa to protect the business interest of
the shipping industry of the municipality. This resolution is signed by the Municipal Vice Mayor as
Presiding Officer of Sangguniang Bayan and approved by the Mayor. To the mind of the court the
approval of the Mayor in a resolution by the Sangguniang Bayan is superfluous. This is not an
ordinance that should be signed by the mayor in order to become effective as a law but a resolution
of that august body. The above resolution was approved on March 17, 1993 not withstanding (sic)
the fact that as shown by the wordings thereat there was already a public hearing conducted by PPA
Manila on March 9, 1993 at the Municipal Multi[-] Purpose Center. The Municipal Mayor was present
and complaints were entertained by the Hearing Officers from several shippers of Hilongos, Leyte.
As appearing also in the lower portion of the said resolution, the same was furnished PPA Manila
and the respondent admitted that she did not even know whether a copy had been sent by the
Sangguniang Bayan to the concerned offices. Granting that this resolution reached the General
Manager, PPA, Manila, she have (sic) not pursued any action on the matter nor the Office of the
Mayor and the Sangguniang Bayan received any information of what proper action was taken
therein. It is indeed unfortunate that whatever nature of the complaints which was heard during the
public hearing by the representative of the PPA, it is not shown whether PPA lend (sic) an ear to it.
The fact remains that on March 1, 1994[,] nearly 1 year after this resolution and public hearing, the
petitioner, Roble Arrastre, Inc., was given a contract by PPA who has the authority under P.D.
87520 (sic) to issue the same.

xxxx

x x x The law is clear that under P.D. 875 the sole authority to authorize operation of cargo handling
services in all ports of the Philippines whether public or private is lodge (sic) with the Philippine Ports
Authority. Under the said law the granting of permits is through the PPA Board carried out by the
General Manager or his assistant. This Court has taken noticed (sic) also that no ordinance had
been passed by the Sangguniang Bayan and approved by the Municipal Mayor of Hilongos, Leyte,
in accordance with the Local Government with regards to the port operation in the port of Hilongos
nor there was [a] showing that the Executive Officer of the municipality has anything to say on the
power and jurisdiction of the PPA in the port of Hilongos, Leyte. This goes to show that even these
public officers knows (sic) the extent of their power as regards the authority of the PPA.

This Court is of the firmed (sic) belief and so holds that the refusal of the Municipal Mayor to approve
the application for renewal is not based on law nor upon her discretion. Under the milieu of the case
the PPA is authorized and have (sic) the exclusive jurisdiction over all ports of the Philippines and
they (sic) alone can issue cargo handling contracts.21

Finding for petitioner, the court a quo disposed as follows:

PREMISES CONSIDERED, by preponderance of evidence, this Court give (sic) due course to this
petition of Mandamus in favor of the Roble Arrastre, Inc. and against the respondent, the Honorable
Municipal Mayor of Hilongos sued in her capacity as a Public Officer and orders her forthwith:

a) To approve the application of Roble Arrastre, Inc. for the year 1994 as he has already paid the
necessary payments in connection therewith albeit the same permit is now functous officio as this is
now 1995. Nevertheless, this approved permit to be issued by the Mayor shall be a basis for renewal
of the said 1994 permit for the year 1995 after payment of due fees required by her office.

Without pronouncement as to costs. The counterclaim of respondent is hereby dismissed. 22

Respondent mayor filed a Motion for Reconsideration thereon, which was denied for lack of merit by
the RTC, in the Order23 dated 25 October 1995.

The Ruling of the Appellate Court

Upon elevation of the case to the Court of Appeals, the appellate court rendered a Decision dated 7
October 1996, reversing and setting aside the RTC. Moreover, it entered a new judgment dismissing
Special Civil Action No. H-237.
The Court of Appeals ruled that the pursuit of the duty of respondent mayor under Section 444(b)(3)
(iv)24 of the Local Government Code necessarily entails the exercise of official discretion. Hence, it
held that mandamus will not lie to control or review the exercise of her discretion. Moreover, the
Court of Appeals declared that petitioner’s main prayer, i.e., to compel respondent mayor to issue a
business license for the year 1994, by the passage of time had already become moot and academic.
On this score, the appellate court declared that the issue is academic. Courts will not adjudicate
moot cases nor hear a case when the object sought is no longer attainable.

The appellate court pronounced, thus:

Under Section 444(b)(3)(iv), all local chief executive officer (sic) or municipal mayors are vested with
the authority to issue licenses and permits within their jurisdiction. In the same provision, the mayor
may likewise suspend or revoke a permit for any violation of the conditions upon which the same
had been issued, pursuant to law or ordinance. In effect, under said Section 444(b)(3)(iv), the
municipal governments, thru its chief executive, are endowed with the authority to exercise police
power.

Evidently, the pursuit of its duty under the (sic) police power necessarily entails exercise of official
discretion in order for any local officials to ascertain which will better serve their constituents who
elected them into office. Full discretion must necessarily be granted them to perform their functions
and it will not be sound logic to simply make them perform purely ministerial functions. And when the
discharge of an official duty requires the exercise of official discretion or judgment, it is never a
ministerial one (Mateo vs. CA, 196 SCRA 280 [1991]).

Furthermore, where the only power given to a municipal corporation or official is to issue license, as
in Section 444 of the Local Government Code, it is clearly regulatory in nature rather than a revenue
raising one. Conclusively, regulation being the object of the power to issue license and permits the
exercise of discretion by the issuing authority becomes an inescapable prerogative. This could be
the very same reason why business permits and licenses are renewed almost annually in order that
the licensing officials in carrying out their functions could examine and evaluate availing
circumstances and conditions and with the exercise of discretion determine whether to grant or deny
the application or, to revoke a license or permit already issued. It should also be understood that a
municipal license is not a property such that it is revocable when public interest so requires (Pedro
vs. Provincial Board of Rizal, 56 Phil. 126). 25

The dispositive portion of the assailed Decision reads:

IN VIEW OF ALL THE FOREGOING, the appealed decision is hereby REVERSED AND SET ASIDE
and a new one entered dismissing Special Civil Action No. [H-]237. No pronouncement as to costs. 26

Petitioner filed a Motion for Reconsideration but the same was denied by the Court of Appeals in its
Resolution dated 13 February 1997.

Hence, the instant Petition.

The Issues

Petitioner, in its Memorandum, presented the following statement of issues, to wit:

I
Whether or not it was valid for the Court of Appeals to have relied on the cases of Mateo v. Court of
Appeals and Pedro v. Provincial Board of Rizal, in ruling that respondent Mayor had full discretion in
issuing or renewing the Business Permit even after the petitioner duly complied with all documentary
requirements and fully paid the corresponding permit fees.

II

Whether or not the Court of Appeals validly interpreted Section 444, (3) (iv), R.A. 7160, otherwise
known as the Local Government Code of 1991, as a grant of police power and full discretion to the
respondent mayor to refuse the issuance of the permit despite due compliance of all documentary
requirements and full payment of the required permit fees by the petitioner.

III

Whether or not the Court of Appeals validly rendered its Decision when it refused to apply the
precedent in Symaco v. Aquino wherein this Honorable Supreme Court held that even in the
absence of any ordinance granting the respondent Mayor such discretion, she cannot refuse
issuance of the permit if there is prior compliance by the petitioner with all documentary requirement
and full payment of the required permit fees.

IV

Whether or not the Court of Appeals validly rendered its Decision when it dismissed the [Petition]
allegedly on the ground that it became (sic) moot and academic. 27

The Ruling of the Court

At the outset, we state our concurrence with the Court of Appeals when it entered a new judgment
dismissing Special Civil Action No. H-237 on the ground of mootness. The appellate court
ratiocinated, to wit:

Lastly, it would seem that the main prayer of the complaint, that is, to compel the respondent mayor
to issue a business license for the year 1994, by the passage of time during which this case pends,
had already become moot and academic. A new application is necessary for the year 1995 and the
year 1996 which is about to end. And in the grant or denial of such application for business permits
or licenses, the respondent mayor must examine closely the circumstances prevailing and again use
her discretion in the exercise of her official function. Accordingly, the issue at hand is already
academic and it is well established that courts will not adjudicate moot cases nor hear a case when
the object sought is not attainable (State vs. Lambert, 52 W. Va. 248, 43 S. E. 176) and it will decline
jurisdiction over moot cases which must involve only actual interests. (In re: Estate of Caballos, 12
Phil. 271; Beech vs. Crossfield, 12 Phil. 555). 28

Indeed, Courts will not determine a moot question in a case in which no practical relief can be
granted. It is unnecessary to indulge in academic discussion of a case presenting a moot question
as a judgment thereon cannot have any practical legal effect or, in the nature of things, cannot be
enforced.29 However, we are constrained to render judgment herein pursuant to our symbolic
function of educating the bench and the bar.30 For another, this case comes within the rule that
courts will decide a question otherwise moot and academic if it is "capable of repetition yet evading
review."31
The crux of the instant controversy is whether respondent mayor can be compelled by a writ of
mandamus to grant petitioner’s application for a renewal of a business permit to operate an arrastre
service at the Municipal Port of Hilongos in Leyte.

Ostensibly, it is petitioner’s contention that respondent mayor’s power to issue permits as contained
in the aforesaid law is ministerial; hence, mandamus lies.

It bears to reiterate this Court’s ruling on the nature of the writ of mandamus. The writ of mandamus
serves to compel a respondent who fails to perform a legal duty or unlawfully excludes another from
the enjoyment of an entitled right or office to do the act required to be done to protect the rights of
the petitioner.32 Otherwise stated, mandamus is issued to command the performance of a ministerial,
but not a discretionary duty.

With that settled, we make a determination of the nature of the power of respondent mayor to grant
petitioner a permit to operate an arrastre service. Central to the resolution of the case at bar is a
reading of Section 444(b)(3)(iv) of the Local Government Code of 1991, which provides, thus:

SEC. 444. The Chief Executive: Powers, Duties, Functions and Compensation.

(b) For efficient, effective and economical governance the purpose of which is the general welfare of
the municipality and its inhabitants pursuant to Section 16 of this Code, the Municipal mayor shall:

xxxx

(3) Initiate and maximize the generation of resources and revenues, and apply the same to the
implementation of development plans, program objectives and priorities as provided for under
Section 18 of this Code, particularly those resources and revenues programmed for agro-industrial
development and country-wide growth and progress, and relative thereto, shall:

xxxx

(iv) Issue licenses and permits and suspend or revoke the same for any violation of the conditions
upon which said licenses or permits had been issued, pursuant to law or ordinance. (Italics
supplied.)

As Section 444(b)(3)(iv) so states, the power of the municipal mayor to issue licenses is pursuant to
Section 16 of the Local Government Code of 1991, which declares:

SEC. 16. General Welfare. - Every local government unit shall exercise the
powers expressly granted, those necessarily implied therefrom, as well
as powers necessary, appropriate, or incidental for its efficient and
effective governance, and those which are essential to the promotion of the
general welfare. Within their respective territorial jurisdictions, local
government units shall ensure and support, among other things, the
preservation and enrichment of culture, promote health and safety, enhance the
right of the people to a balanced ecology, encourage and support the
development of appropriate and self-reliant scientific and
technological capabilities, improve public morals, enhance economic prosperity
and social justice, promote full employment among their residents, maintain
peace and order, and preserve the comfort and convenience of their
inhabitants.
Section 16, known as the general welfare clause, encapsulates the delegated police power to local
governments. Local government units exercise police power through their respective legislative
bodies.33 Evidently, the Local Government Code of 1991 is unequivocal that the municipal mayor has
the power to issue licenses and permits and suspend or revoke the same for any violation of the
conditions upon which said licenses or permits had been issued, pursuant to law or ordinance. On
this matter, petitioner maintains that under the Local Government Code of 1991, a suspension or
revocation of permits shall be premised on a finding of violation of the conditions upon which the
permits were issued pursuant to a law or ordinance, which is independent of the Code itself.
Petitioner asseverates further that there was no law or ordinance that conferred upon the respondent
mayor the power to refuse the issuance of the permit despite compliance of petitioner with all
documentary requirements and payment of all the fees.

First. On petitioner’s assertion that the power to issue license should be pursuant to law other than
the Local Government Code of 1991, we so hold that the language of the law did not find the need to
distinguish between other laws and that of the Local Government Code of 1991 itself. When the law
does not distinguish, we must not distinguish. 34 Ubi lex non distinguit nec nos distinguere
debemus. Hence, even the Local Government Code of 1991, specifically Section 16 thereof, can be
utilized to determine the bounds of the exercise of the municipal mayor in issuing licenses and
permits.

Second. While we agree with petitioner that there is no ordinance conferring upon the respondent
mayor the power to refuse the issuance of the permit for the operation of an arrastre service, we are,
as yet, unprepared to declare that the power of the municipal mayor as enunciated under Section
444(b)(3)(iv) is ministerial. What can be deduced from the aforesaid section is that the limits in the
exercise of the power of a municipal mayor to issue licenses, and permits and suspend or revoke the
same can be contained in a law or an ordinance. Otherwise stated, a law or an ordinance can
provide the conditions upon which the power of the municipal mayor under Section 444(b)(3)(iv) can
be exercised. Section 444(b)(3)(iv) of the Local Government Code of 1991 takes its cue from
Section 16 thereof, which is largely an exercise of delegated police power. We said:

The general welfare clause is the delegation in statutory form of the police power of the State to
LGUs. Through this, LGUs may prescribe regulations to protect the lives, health, and property of
their constituents and maintain peace and order within their respective territorial jurisdictions.
Accordingly, we have upheld enactments providing, for instance, the regulation of gambling,  the
occupation of rig drivers, the installation and operation of pinball machines, the maintenance and
operation of cockpits, the exhumation and transfer of corpses from public burial grounds, and the
operation of hotels, motels, and lodging houses as valid exercises by local legislatures of the police
power under the general welfare clause.35

Section 444(b)(3)(iv) of the Local Government Code of 1991, whereby the power of the respondent
mayor to issue license and permits is circumscribed, is a manifestation of the delegated police power
of a municipal corporation.36 Necessarily, the exercise thereof cannot be deemed ministerial. As to
the question of whether the power is validly exercised, the matter is within the province of a writ of
certiorari, but certainly, not of mandamus.

It may be true, as argued by petitioner, that Resolution No. 93-27, which was enacted by the
Sangguniang Bayan of Hilongos, is not an ordinance but merely a resolution. A municipal ordinance
is different from a resolution. An ordinance is a law, but a resolution is merely a declaration of the
sentiment or opinion of a lawmaking body on a specific matter. An ordinance possesses a general
and permanent character, but a resolution is temporary in nature. Additionally, the two are enacted
differently - a third reading is necessary for an ordinance, but not for a resolution, unless decided
otherwise by a majority of all the Sanggunian members.37
However, the fact that Resolution No. 93-27 is a "mere" resolution can do nil to support petitioner’s
cause. As stated earlier, the proper action is certiorari to determine whether grave abuse of
discretion had been committed on the part of respondent mayor in the refusal to grant petitioner’s
application. Petitioner’s petition for mandamus is incompetent against respondent mayor’s
discretionary power. Thus:

"Discretion," when applied to public functionaries, means a power or right conferred upon them by
law or acting officially, under certain circumstances, uncontrolled by the judgment or conscience of
others. A purely ministerial act or duty in contradiction to a discretional act is one which an officer or
tribunal performs in a given state of facts, in a prescribed manner, in obedience to the mandate of a
legal authority, without regard to or the exercise of his own judgment upon the propriety or
impropriety of the act done. If the law imposes a duty upon a public officer and gives him the right to
decide how or when the duty shall be performed, such duty is discretionary and not ministerial. The
duty is ministerial only when the discharge of the same requires neither the exercise of official
discretion or judgment.38

The Fallo

WHEREFORE, the Petition is DENIED. The assailed Decision and Resolution of the Court of
Appeals in CA-G.R. SP No. 40621, dated 7 October 1996 and 13 February 1997, respectively,
dismissing Special Civil Action No. H-237 are AFFIRMED. Costs against petitioner.

SO ORDERED.
Adasa vs Abalos

G.R. No. 168617             February 19, 2007

BERNADETTE L. ADASA, petitioner,
vs.
CECILLE S. ABALOS, Respondent.

DECISION

CHICO-NAZARIO, J.:

This Petition for Review under Rule 45 of the Rules of Court, filed by petitioner Bernadette L. Adasa,
seeks to nullify and set aside the 21 July 2004 Decision 1 and 10 June 2005 Resolution2 of the Court
of Appeals in CA-G.R. SP No. 76396 which nullified the Resolutions of the Department of Justice
(DOJ). The Resolutions of the DOJ reversed and set aside the Resolution of the Office of the City
Prosecutor of Iligan City, which found on reinvestigation probable cause against petitioner, and
directed the Office of the City Prosecutor of Iligan City to withdraw the information for Estafa against
petitioner.

The instant case emanated from the two complaints-affidavits filed by respondent Cecille S. Abalos
on 18 January 2001 before the Office of the City Prosecutor of Iligan City, against petitioner for
Estafa.

Respondent alleged in the complaints-affidavits that petitioner, through deceit, received and
encashed two checks issued in the name of respondent without respondent’s knowledge and
consent and that despite repeated demands by the latter, petitioner failed and refused to pay the
proceeds of the checks.

On 23 March 2001, petitioner filed a counter-affidavit admitting that she received and encashed the
two checks issued in favor of respondent.

In her Supplemental Affidavit filed on 29 March 2001, petitioner, however, recanted and alleged
instead that it was a certain Bebie Correa who received the two checks which are the subject matter
of the complaints and encashed the same; and that said Bebie Correa left the country after
misappropriating the proceeds of the checks.

On 25 April 2001, a resolution was issued by the Office of the City Prosecutor of Iligan City finding
probable cause against petitioner and ordering the filing of two separate Informations for Estafa Thru
Falsification of Commercial Document by a Private Individual, under Article 315 in relation to Articles
171 and 172 of the Revised Penal Code, as amended.

Consequently, two separate criminal cases were filed against petitioner docketed as Criminal Cases
No. 8781 and No. 8782, raffled to Branches 4 and 5, Regional Trial Court of Iligan City, respectively.

This instant petition pertains only to Criminal Case No. 8782.

On 8 June 2001, upon motion of the petitioner, the trial court in Criminal Case No. 8782 issued an
order directing the Office of the City Prosecutor of Iligan City to conduct a reinvestigation.
After conducting the reinvestigation, the Office of the City Prosecutor of Iligan City issued a
resolution dated 30 August 2001, affirming the finding of probable cause against petitioner.

Meanwhile, during her arraignment on 1 October 2001 in Criminal Case No. 8782, petitioner entered
an unconditional plea of not guilty.3

Dissatisfied with the finding of the Office of the City Prosecutor of Iligan City, petitioner filed a
Petition for Review before the DOJ on 15 October 2001.

In a Resolution dated 11 July 2002, the DOJ reversed and set aside the 30 August 2001 resolution
of the Office of the City Prosecutor of Iligan City and directed the said office to withdraw the
Information for Estafa against petitioner.

The said DOJ resolution prompted the Office of the City Prosecutor of Iligan City to file a "Motion to
Withdraw Information" on 25 July 2002.

On 26 July 2002, respondent filed a motion for reconsideration of said resolution of the DOJ arguing
that the DOJ should have dismissed outright the petition for review since Section 7 of DOJ Circular
No. 70 mandates that when an accused has already been arraigned and the aggrieved party files a
petition for review before the DOJ, the Secretary of Justice cannot, and should not take cognizance
of the petition, or even give due course thereto, but instead deny it outright. Respondent claimed
Section 12 thereof mentions arraignment as one of the grounds for the dismissal of the petition for
review before the DOJ.

In a resolution dated 30 January 2003, the DOJ denied the Motion for Reconsideration opining that
under Section 12, in relation to Section 7, of DOJ Circular No. 70, the Secretary of Justice is not
precluded from entertaining any appeal taken to him even where the accused has already been
arraigned in court. This is due to the permissive language "may" utilized in Section 12 whereby the
Secretary has the discretion to entertain an appealed resolution notwithstanding the fact that the
accused has been arraigned.

Meanwhile, on 27 February 2003, the trial court issued an order granting petitioner’s "Motion to
Withdraw Information" and dismissing Criminal Case No. 8782. No action was taken by respondent
or any party of the case from the said order of dismissal.

Aggrieved by the resolution of the DOJ, respondent filed a Petition for Certiorari before the Court of
Appeals. Respondent raised the following issues before the appellate court:

1. Whether or not the Department of Justice gravely abused its discretion in giving due
course to petitioner’s petition for review despite its having been filed after the latter had
already been arraigned;

2. Whether or not there is probable cause that the crime of estafa has been committed and
that petitioner is probably guilty thereof;

3. Whether or not the petition before the Court of Appeals has been rendered moot and
academic by the order of the Regional Trial Court dismissing Criminal Case No. 8782.

The Court of Appeals in a Decision dated 21 July 2004 granted respondent’s petition and reversed
the Resolutions of the DOJ dated 11 July 2002 and 30 January 2003.
In resolving the first issue, the Court of Appeals, relying heavily on Section 7 of DOJ Circular No. 70
which states "[i]f an information has been filed in court pursuant to the appealed resolution, the
petition shall not be given due course if the accused had already been arraigned," ruled that since
petitioner was arraigned before she filed the petition for review with the DOJ, it was imperative for
the DOJ to dismiss such petition. It added that when petitioner pleaded to the charge, she was
deemed to have waived her right to reinvestigation and right to question any irregularity that
surrounds it.

Anent the second issue, the Court of Appeals declared that the existence of probable cause or the
lack of it, cannot be dealt with by it since factual issues are not proper subjects of a Petition for
Certiorari.

In disposing of the last issue, the Court of Appeals held that the order of the trial court dismissing the
subject criminal case pursuant to the assailed resolutions of the DOJ did not render the petition moot
and academic. It said that since the trial court’s order relied solely on the resolutions of the DOJ,
said order is void as it violated the rule which enjoins the trial court to assess the evidence presented
before it in a motion to dismiss and not to rely solely on the prosecutor’s averment that the Secretary
of Justice had recommended the dismissal of the case.

Dissatisfied by the Court of Appeals’ ruling, petitioner filed a Motion for Reconsideration setting forth
the following grounds:

1. that the over-all language of Sections 7 and 12 of Department Circular No. 70 is

permissive and directory such that the Secretary of Justice may entertain an appeal despite
the fact that the accused had been arraigned;

2. that the contemporaneous construction by the Secretary of Justice should be given great
weight and respect;

3. that Section 7 of the Circular applies only to resolutions rendered pursuant to a preliminary
investigation, not on a reinvestigation;

4. that the trial court’s order of dismissal of the criminal case has rendered the instant petition
moot and academic;

5. that her arraignment was null and void it being conducted despite her protestations; and

6. that despite her being arraigned, the supposed waiver of her right to preliminary
investigation has been nullified or recalled by virtue of the trial court’s order of
reinvestigation.4

The Court of Appeals stood firm by its decision. This time, however, it tried to construe Section 7
side by side with Section 12 of DOJ Circular No. 70 and attempted to reconcile these two provisions.
According to the appellate court, the phrase "shall not" in paragraph two, first sentence of Section 7
of subject circular, to wit:

If an information has been filed in court pursuant to the appealed resolution, the petition shall not be
given due course if the accused had already been arraigned. x x x. (Emphasis supplied.)

employed in the circular denotes a positive prohibition. Applying the principle in statutory
construction - that when a statute or provision contains words of positive prohibition, such as "shall
not," "cannot," or "ought not" or which is couched in negative terms importing that the act shall not
be done otherwise than designated, that statute or provision is mandatory, thus rendering the
provision mandatory – it opined that the subject provision simply means that the Secretary of Justice
has no other course of action but to deny or dismiss a petition before him when arraignment of an
accused had already taken place prior to the filing of the petition for review.

On the other hand, reading Section 12 of the same circular which reads:

The Secretary may reverse, affirm or modify the appealed resolution. He may, motu proprio or upon
motion, dismiss the petition for review on any of the following grounds:

xxxx

(e) That the accused had already been arraigned when the appeal was taken; x x x.

the Court of Appeals opined that the permissive word "may" in Section 12 would seem to imply that
the Secretary of Justice has discretion to entertain an appeal notwithstanding the fact that the
accused has been arraigned. This provision should not be treated separately, but should be read in
relation to Section 7. The two provisions, taken together, simply meant that when an accused was
already arraigned when the aggrieved party files a petition for review, the Secretary of Justice
cannot, and should not take cognizance of the petition, or even give due course thereto, but instead
dismiss or deny it outright. The appellate court added that the word "may" in Section 12 should be
read as "shall" or "must" since such construction is absolutely necessary to give effect to the
apparent intention of the rule as gathered from the context.

As to the contemporaneous construction of the Secretary of Justice, the Court of Appeals stated that
the same should not be given weight since it was erroneous.

Anent petitioner’s argument that Section 7 of the questioned circular applies only to original
resolutions that brought about the filing of the corresponding informations in court, but not to
resolutions rendered pursuant to a motion for reinvestigation, the appellate court simply brushed
aside such contention as having no basis in the circular questioned.

It also rejected petitioner’s protestation that her arraignment was forced upon her since she failed to
present any evidence to substantiate the same.

It is petitioner’s contention that despite her being arraigned, the supposed waiver of her right to
preliminary investigation has been nullified by virtue of the trial court’s order or reinvestigation. On
this score, the Court of Appeals rebuffed such argument stating that there was no "supposed waiver
of preliminary investigation" to speak of for the reason that petitioner had actually undergone
preliminary investigation.

Petitioner remained unconvinced with the explanations of the Court of Appeals.

Hence, the instant petition.

Again, petitioner contends that the DOJ can give due course to an appeal or petition for review
despite its having been filed after the accused had already been arraigned. It asserts that the fact of
arraignment of an accused before the filing of an appeal or petition for review before the DOJ "is not
at all relevant" as the DOJ can still take cognizance of the appeal or Petition for Review before it. In
support of this contention, petitioner set her sights on the ruling of this Court in Crespo v. Mogul, 5 to
wit:

The rule therefore in this jurisdiction is that once a complaint or information is filed in Court any
disposition of the case as to its dismissal or the conviction or acquittal of the accused rests in the
sound discretion of the Court. Although the fiscal retains the direction and control of the prosecution
of criminal cases even while the case is already in Court he cannot impose his opinion on the trial
court. The Court is the best and sole judge on what to do with the case before it. The determination
of the case is within its exclusive jurisdiction and competence. A motion to dismiss the case filed by
the fiscal should be addressed to the Court who has the option to grant or deny the same. It does
not matter if this is done before or after the arraignment of the accused or that the motion was filed
after a reinvestigation or upon instructions of the Secretary of Justice who reviewed the records of
the investigation. (Emphasis supplied.)

To bolster her position, petitioner cites Roberts v. Court of Appeals, 6 which stated:

There is nothing in Crespo vs. Mogul which bars the DOJ from taking cognizance of an appeal, by
way of a petition for review, by an accused in a criminal case from an unfavorable ruling of the
investigating prosecutor. It merely advised the DOJ to, "as far as practicable, refrain from
entertaining a petition for review or appeal from the action of the fiscal, when the complaint or
information has already been filed in Court. x x x. (Emphasis supplied.)

Petitioner likewise invokes Marcelo v. Court of Appeals 7 where this Court declared:

Nothing in the said ruling forecloses the power or authority of the Secretary of Justice to review
resolutions of his subordinates in criminal cases. The Secretary of Justice is only enjoined to refrain
as far as practicable from entertaining a petition for review or appeal from the action of the
prosecutor once a complaint or information is filed in court. In any case, the grant of a motion to
dismiss, which the prosecution may file after the Secretary of Justice reverses an appealed
resolution, is subject to the discretion of the court.

The Court is unconvinced.

A cursory reading of Crespo v. Mogul reveals that the ruling therein does not concern the issue of an
appeal or petition for review before the DOJ after arraignment. Verily, the pronouncement therein
has to do with the filing of a motion to dismiss and the court’s discretion to deny or grant the same.
As correctly pointed out by respondent, the emphasized portion in the Crespo ruling is a parcel of
the entire paragraph which relates to the duty and jurisdiction of the trial court to determine for itself
whether or not to dismiss a case before it, and which states that such duty comes into play
regardless of whether such motion is filed before or after arraignment and upon whose instructions.
The allusion to the Secretary of Justice as reviewing the records of investigation and giving
instructions for the filing of a motion to dismiss in the cited ruling does not take into consideration of
whether the appeal or petition before the Secretary of Justice was filed after arraignment.
Significantly, in the Crespo case, the accused had not yet been arraigned when the appeal or
petition for review was filed before the DOJ. Undoubtedly, petitioner’s reliance on the said case is
misplaced.

Also unavailing is petitioner’s invocation of the cases of Roberts v. Court of Appeals and Marcelo v.
Court of Appeals. As in Crespo v. Mogul, neither Roberts v. Court of Appeals nor Marcelo v. Court of
Appeals took into account of whether the appeal or petition before the Secretary of Justice was filed
after arraignment. Just like in the Crespo case, the accused in both Roberts v. Court of Appeals and
Marcelo v. Court of Appeals had not yet been arraigned when the appeal or petition for review was
filed before the DOJ.

Moreover, petitioner asserts that the Court of Appeals’ interpretation of the provisions of DOJ
Circular No. 70 violated three basic rules in statutory construction. First, the rule that the provision
that appears last in the order of position in the rule or regulation must prevail. Second, the rule that
the contemporaneous construction of a statute or regulation by the officers who enforce it should be
given weight. Third, petitioner lifted a portion from Agpalo’s Statutory Construction 8 where the word
"shall" had been construed as a permissive, and not a mandatory language.

The all too-familiar rule in statutory construction, in this case, an administrative rule 9 of procedure, is
that when a statute or rule is clear and unambiguous, interpretation need not be resorted to. 10 Since
Section 7 of the subject circular clearly and categorically directs the DOJ to dismiss outright an
appeal or a petition for review filed after arraignment, no resort to interpretation is necessary.

Petitioner’s reliance to the statutory principle that "the last in order of position in the rule or regulation
must prevail" is not applicable. In addition to the fact that Section 7 of DOJ Circular No. 70 needs no
construction, the cited principle cannot apply because, as correctly observed by the Court of
Appeals, there is no irreconcilable conflict between Section 7 and Section 12 of DOJ Circular No. 70.
Section 7 of the circular provides:

SECTION 7. Action on the petition. – The Secretary of Justice may dismiss the petition outright if he
finds the same to be patently without merit or manifestly intended for delay, or when the issues
raised therein are too unsubstantial to require consideration. If an information has been filed in court
pursuant to the appealed resolution, the petition shall not be given due course if the accused had
already been arraigned. Any arraignment made after the filing of the petition shall not bar the
Secretary of Justice from exercising his power of review. (Italics supplied.)

On the other hand, Section 12 of the same circular states:

SECTION 12. Disposition of the Appeal. – The Secretary may reverse, affirm or modify the appealed
resolution. He may, motu proprio or upon motion, dismiss the petition for review on any of the
following grounds:

(a) That the petition was filed beyond the period prescribed in Section 3 hereof;

(b) That the procedure or any of the requirements herein provided has not been complied
with;

(c) That there is no showing of any reversible error;

(d) That the appealed resolution is interlocutory in nature, except when it suspends the
proceedings based on the alleged existence of a prejudicial question;

(e) That the accused had already been arraigned when the appeal was taken;

(f) That the offense has already prescribed; and

(g) That other legal or factual grounds exist to warrant a dismissal. (Emphases supplied.)
It is noteworthy that the principle cited by petitioner reveals that, to find application, the same
presupposes that "one part of the statute cannot be reconciled or harmonized with another part
without nullifying one in favor of the other." In the instant case, however, Section 7 is neither
contradictory nor irreconcilable with Section 12. As can be seen above, Section 7 pertains to the
action on the petition that the DOJ must take, while Section 12 enumerates the options the DOJ has
with regard to the disposition of a petition for review or of an appeal.

As aptly observed by respondent, Section 7 specifically applies to a situation on what the DOJ must
do when confronted with an appeal or a petition for review that is either clearly without merit,
manifestly intended to delay, or filed after an accused has already been arraigned, i.e., he may
dismiss it outright if it is patently without merit or manifestly intended to delay, or, if it was filed after
the acccused has already been arraigned, the Secretary shall not give it due course.

Section 12 applies generally to the disposition of an appeal. Under said section, the DOJ may take
any of four actions when disposing an appeal, namely:

1. reverse the appealed resolution;

2. modify the appealed resolution;

3. affirm the appealed resolution;

4. dismiss the appeal altogether, depending on the circumstances and incidents attendant
thereto.

As to the dismissal of a petition for review or an appeal, the grounds are provided for in Section 12
and, consequently, the DOJ must evaluate the pertinent circumstances and the facts of the case in
order to determine which ground or grounds shall apply.

Thus, when an accused has already been arraigned, the DOJ must not give the appeal or petition for
review due course and must dismiss the same. This is bolstered by the fact that arraignment of the
accused prior to the filing of the appeal or petition for review is set forth as one of the grounds for its
dismissal. Therefore, in such instance, the DOJ, noting that the arraignment of an accused prior to
the filing of an appeal or petition for review is a ground for dismissal under Section 12, must go back
to Section 7 and act upon as mandated therein. In other words, the DOJ must not give due course
to, and must necessarily dismiss, the appeal.

Likewise, petitioner’s reliance on the principle of contemporary construction, i.e., the DOJ is not
precluded from entertaining appeals where the accused had already been arraigned, because it
exercises discretionary power, and because it promulgated itself the circular in question, is
unpersuasive. As aptly ratiocinated by the Court of Appeals:

True indeed is the principle that a contemporaneous interpretation or construction by the officers
charged with the enforcement of the rules and regulations it promulgated is entitled to great weight
by the court in the latter’s construction of such rules and regulations. That does not, however, make
such a construction necessarily controlling or binding. For equally settled is the rule that courts may
disregard contemporaneous construction in instances where the law or rule construed possesses no
ambiguity, where the construction is clearly erroneous, where strong reason to the contrary exists,
and where the court has previously given the statute a different interpretation.
If through misapprehension of law or a rule an executive or administrative officer called upon to
implement it has erroneously applied or executed it, the error may be corrected when the true
construction is ascertained. If a contemporaneous construction is found to be erroneous, the same
must be declared null and void. Such principle should be as it is applied in the case at bar. 11

Petitioner’s posture on a supposed exception to the mandatory import of the word "shall" is
misplaced. It is petitioner’s view that the language of Section 12 is permissive and therefore the
mandate in Section 7 has been transformed into a matter within the discretion of the DOJ. To
support this stance, petitioner cites a portion of Agpalo’s Statutory Construction which reads:

For instance, the word "shall" in Section 2 of Republic Act 304 which states that "banks or other
financial institutions owned or controlled by the Government shall, subject to availability of funds xxx,
accept at a discount at not more than two per centum for ten years such (backpay) certificate"
implies not a mandatory, but a discretionary, meaning because of the phrase "subject to availability
of funds." Similarly, the word "shall" in the provision to the effect that a corporation violating the
corporation law "shall, upon such violation being proved, be dissolved by quo warranto proceedings"
has been construed as "may."12

After a judicious scrutiny of the cited passage, it becomes apparent that the same is not applicable
to the provision in question. In the cited passage, the word "shall" departed from its mandatory
import connotation because it was connected to certain provisos/conditions: "subject to the
availability of funds" and "upon such violation being proved." No such proviso/condition, however,
can be found in Section 7 of the subject circular. Hence, the word "shall" retains its mandatory
import.

At this juncture, the Court of Appeals’ disquisition in this matter is enlightening:

Indeed, if the intent of Department Circular No. 70 were to give the Secretary of Justice a
discretionary power to dismiss or to entertain a petition for review despite its being outrightly
dismissible, such as when the accused has already been arraigned, or where the crime the accused
is being charged with has already prescribed, or there is no reversible error that has been
committed, or that there are legal or factual grounds warranting dismissal, the result would not only
be incongruous but also irrational and even unjust. For then, the action of the Secretary of Justice of
giving due course to the petition would serve no purpose and would only allow a great waste of time.
Moreover, to give the second sentence of Section 12 in relation to its paragraph (e) a directory
application would not only subvert the avowed objectives of the Circular, that is, for the expeditious
and efficient administration of justice, but would also render its other mandatory provisions -
Sections 3, 5, 6 and 7, nugatory.13

In her steadfast effort to champion her case, petitioner contends that the issue as to whether the
DOJ rightfully entertained the instant case, despite the arraignment of the accused prior to its filing,
has been rendered moot and academic with the order of dismissal by the trial court dated 27
February 2003. Such contention deserves scant consideration.

It must be stressed that the trial court dismissed the case precisely because of the Resolutions of
the DOJ after it had, in grave abuse of its discretion, took cognizance of the petition for review filed
by petitioner. Having been rendered in grave abuse of its discretion, the Resolutions of the DOJ are
void. As the order of dismissal of the trial court was made pursuant to the void Resolutions of the
DOJ, said order was likewise void. The rule in this jurisdiction is that a void judgment is a complete
nullity and without legal effect, and that all proceedings or actions founded thereon are themselves
regarded as invalid and ineffective for any purpose. 14 That respondent did not file a motion for
reconsideration or appeal from the dismissal order of the trial court is of no moment. Since the
dismissal was void, there was nothing for respondent to oppose.

Petitioner further asserts that Section 7 of DOJ Circular No. 70 applies only to appeals from original
resolution of the City Prosecutor and does not apply in the instant case where an appeal is
interposed by petitioner from the Resolution of the City Prosecutor denying her motion for
reinvestigation. This claim is baseless. 1avvphi1 .net

A reading of Section 7 discloses that there is no qualification given by the same provision to limit its
application to appeals from original resolutions and not to resolutions on reinvestigation. Hence, the
rule stating that "when the law does not distinguish, we must not distinguish" 15 finds application in
this regard.

Petitioner asserts that her arraignment was null and void as the same was improvidently conducted.
Again, this contention is without merit. Records reveal that petitioner’s arraignment was without any
restriction, condition or reservation. 16 In fact she was assisted by her counsels Atty. Arthur Abudiente
and Atty. Maglinao when she pleaded to the charge. 17

Moreover, the settled rule is that when an accused pleads to the charge, he is deemed to have
waived the right to preliminary investigation and the right to question any irregularity that surrounds
it.18 This precept is also applicable in cases of reinvestigation as well as in cases of review of such
reinvestigation. In this case, when petitioner unconditionally pleaded to the charge, she effectively
waived the reinvestigation of the case by the prosecutor as well as the right to appeal the result
thereof to the DOJ Secretary. Thus, with the arraignment of the petitioner, the DOJ Secretary can no
longer entertain the appeal or petition for review because petitioner had already waived or
abandoned the same.

Lastly, while there is authority19 permitting the Court to make its own determination of probable
cause, such, however, cannot be made applicable in the instant case. As earlier stated, the
arraignment of petitioner constitutes a waiver of her right to preliminary investigation or
reinvestigation. Such waiver is tantamount to a finding of probable cause. For this reason, there is
no need for the Court to determine the existence or non-existence of probable cause.

Besides, under Rule 45 of the Rules of Court, only questions of law may be raised in, and be subject
of, a petition for review on certiorari since this Court is not a trier of facts. This being the case, this
Court cannot review the evidence adduced by the parties before the prosecutor on the issue of the
absence or presence of probable cause.20

WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals dated 21 July 2004
and its Resolution dated 10 June 2005 in CA-G.R. SP No. 76396 are AFFIRMED. Costs against
petitioner.

SO ORDERED.
Republic vs Phil. Rabbit Bus Lines Inc

G.R. No. L-26862 March 30, 1970

REPUBLIC OF THE PHILIPPINES, plaintiff-appellant,

vs.
PHILIPPINE RABBIT BUS LINES, INC., defendant-appellee.

Office of the Solicitor General Antonio P. Barredo, Assistant Solicitor General Pacifico P. de Castro
and Solicitor Enrique M. Reyes for plaintiff-appellant.

Angel A. Sison for defendant-appellee.

FERNANDO, J.:

The right of a holder of a backpay certificate to use the same in the payment of his taxes has been
recognized by law.1 Necessarily, this Court, in Tirona v. Cudiamat,2 yielding obedience to such statutory
prescription, saw nothing objectionable in a taxpayer taking advantage of such a provision. That much is
clear; it is settled beyond doubt. What is involved in this appeal from a lower court decision of November
24, 1965, dismissing a complaint by plaintiff-appellant Republic of the Philippines, seeking the invalidation
of the payment by defendant-appellee Philippine Rabbit Bus Lines, Inc. for the registration fees 3 of its
motor vehicles in the sum of P78,636.17, in the form of such negotiable backpay certificates of
indebtedness, is the applicability of such a provision to such a situation. The lower court held that it did.
The Republic of the Philippines appealed. While originally the matter was elevated to the Court of
Appeals, it was certified to us, the decisive issue being one of law. The statute having restricted the
privilege to the satisfaction of a tax, a liability for fees under the police power being thus excluded from its
benefits, we cannot uphold the decision appealed from. We reverse.

The complaint of plaintiff-appellant Republic of the Philippines was filed on January 17, 1963
alleging that defendant-appellee, as the registered owner of two hundred thirty eight (238) motor
vehicles, paid to the Motor Vehicles Office in Baguio the amount of P78,636.17, corresponding to the
second installment of registration fees for 1959, not in cash but in the form of negotiable certificate of
indebtedness, the defendant being merely an assignee and not the backpay holder itself. The
complaint sought the payment of such amount with surcharges plus the legal rate of interest from the
filing thereof and a declaration of the nullity of the use of such negotiable certificate of indebtedness
to satisfy its obligation. The answer by defendant-appellee, filed on February 18, 1963, alleged that
what it did was in accordance with law, both the Treasurer of the Philippines and the General
Auditing Office having signified their conformity to such a mode of payment. It sought the dismissal
of the complaint.

After noting the respective theories of both parties in its pleadings, the lower court, in its decision,
stated that the issue before it "is whether or not the acceptance of the negotiable certificates of
indebtedness tendered by defendant bus firms to and accepted by the Motor Vehicles Office of
Baguio City and the corresponding issuance of official receipts therefor acknowledging such
payment by said office is valid and binding on plaintiff Republic." 4

In the decision now on appeal, the lower court, after referring to a documentary evidence introduced
by plaintiff-appellant continued: "From the evidence adduced by defendant bus firm, it appears that
as early as August 28, 1958, the National Treasurer upon whom devolves the function of
administering the Back Pay Law (Republic Act 304 as amended by Republic Act Nos. 800 and 897),
in his letter to the Chief of the Motor Vehicles Office who in turn quoted and circularized same in his
Circular No. 5 dated September 1, 1958, to draw the attention thereto of all Motor Vehicle
Supervisors, Registrars and employees ..., had approved the acceptance of negotiable certificates of
indebtedness in payment of registration fees of motor vehicles with the view that such certificates
'should be accorded with the same confidence by other governmental instrumentalities as other
evidences of public debt, such as bonds and treasury certificates'. Significantly, the Auditor General
concurred in the said view of the National Treasurer." 5

The argument of plaintiff-appellant that only the holders of the backpay certificates themselves could
apply the same to the payment of motor vehicle registration fees did not find favor with the lower
court. Thus, "[Plaintiff] Republic urges that defendant bus firm being merely an assignee of the
negotiable certificates of indebtedness in question, it could not use the same in payment of taxes.
Such contention, this Court believes, runs counter to the recitals appearing on the said certificates
which states that 'the Republic of the Philippines hereby acknowledges to (name) or assigns ...',
legally allowing the assignment of backpay rights." 6

It therefore, as above noted, rendered judgment in favor of defendant-appellee "upholding the

validity and efficacy" of such payment made and dismissing the complaint. Hence this appeal which,
on the decisive legal issue already set forth at the outset, we find meritorious.

1. If a registration fee were a tax, then what was done by defendant-appellee was strictly in
accordance with law and its nullity, as sought by plaintiff-appellant Republic of the Philippines,
cannot be decreed. But is it? The answer to that question is decisive of this controversy. A tax refers
to a financial obligation imposed by a state on persons, whether natural or juridical, within its
jurisdiction, for property owned, income earned, business or profession engaged in, or any such
activity analogous in character for raising the necessary revenues to take care of the responsibilities
of government.7 An often-quoted definition is that of Cooley: "Taxes are the enforced proportional
contributions from persons and property levied by the state by virtue of its sovereignty for the
support of government and for all public needs."8

As distinguished from other pecuniary burdens, the differentiating factor is that the purpose to be
subserved is the raising of revenue. A tax then is neither a penalty that must be satisfied or a liability
arising from contract.9 Much less can it be confused or identified with a license or a fee as a
manifestation of an exercise of the police power. It has been settled law in this jurisdiction as far
back as Cu Unjieng v. Potstone, decided in 1962, 10 that this broad and all-encompassing
governmental competence to restrict rights of liberty and property carries with it the undeniable
power to collect a regulatory fee. Unlike a tax, it has not for its object the raising of revenue but looks
rather to the enactment of specific measures that govern the relations not only as between
individuals but also as between private parties and the political society. To quote from Cooley anew:
"Legislation for these purposes it would seem proper to look upon as being made in the exercise of
that authority ... spoken of as the police power." 11

The registration fee which defendant-appellee had to pay was imposed by Section 8 of the Revised
Motor Vehicle Law. 12 Its heading speaks of "registration fees." The term is repeated four times in
the body thereof. Equally so, mention is made of the "fee for registration." 13 A subsection starts
with a categorical statement "No fees shall be charged." 14 The conclusion is difficult to resist
therefore that the Motor Vehicle Act requires the payment not of a tax but of a registration fee under
the police power. Hence the inapplicability of the section relied upon by defendant-appellee under
the Back Pay Law. It is not held liable for a tax but for a registration fee. It therefore cannot make
use of a backpay certificate to meet such an obligation.
Any vestige of any doubt as to the correctness of the above conclusion should be dissipated by
Republic Act No. 5448. 15 A special science fund was thereby created and its title expressly sets
forth that a tax on privately-owned passenger automobiles, motorcycles and scooters was imposed.
The rates thereof were provided for in its Section 3 which clearly specifies that "additional tax" was
to be paid as distinguished from the registration fee under the Motor Vehicle Act. There cannot be
any clearer expression therefore of the legislative will, even on the assumption that the earlier
legislation could be stretching the point be susceptible of the interpretation that a tax rather than a
fee was levied. What is thus most apparent is that where the legislative body relies on its authority to
tax it expressly so states, and where it is enacting a regulatory measure, it is equally explicit.

It may further be stated that a statute is meaningful not only by what it includes but also by what it
omits. What is left out is not devoid of significance. As observed by Frankfurter: "An omission at the
time of enactment, whether careless or calculated, cannot be judicially supplied however much later
wisdom may recommend the inclusion. 16 In the light of this consideration, the reversal of the
appealed judgment is unavoidable.

2. In the brief for plaintiff-appellant Republic of the Philippines, filed by the then Solicitor General,
now Justice Antonio P. Barredo, the principal error imputed to the trial court is its failure to hold that
the Back Pay Law prohibits an assignee, as is defendant-appellee, from using certificates of
indebtedness to pay their taxes. In view of the conclusion reached by us that the liability of
defendant-appellee under the Motor Vehicle Act does not arise under the taxing power of the state,
there is no need to pass upon this particular question.

3. The Republic of the Philippines, in its brief, likewise assigned as error the failure of the lower court
to hold that estoppel does not lie against the government for mistakes committed by its agents. As
could be discerned from an excerpt of the decision earlier referred to, the lower court was impressed
by the fact that the national treasurer to whom it correctly referred as being vested with the function
of administering the backpay law did in a communication to the Motor Vehicles Office approve the
acceptance of negotiable certificate of indebtedness in payment of registration fees, a view with
which the Auditor General was in concurrence. The appealed decision likewise noted: "By the
testimonies of Pedro Flores, the then Registrar of the Motor Vehicles Office of Baguio City and
Casiano Catbagan, the Cashier of the Bureau of Public Highways in the same city, defendant bus
firm has undisputedly shown that, after the said certificates of indebtedness were properly indorsed
in favor of the Motor Vehicles Office of Baguio City and accepted by the Bureau of Public Highways
on May 29, 1959, it was duly and properly issued official receipts ... acknowledging full payment of
its registration fees for the second installment of 1959 of its 238 vehicles, and that the Bureau of
Public Highways, thru its collecting and disbursing officer, was validly and regularly authorized to
receive such payment." 17

Thus did the lower court, as pointed out by the then Solicitor General, conclude that the government
was bound by the mistaken interpretation arrived at by the national treasurer and the auditor
general. It would consider estoppel as applicable. That is not the law. Estoppel does not lie. Such a
principle dates back to Aguinaldo de Romero v. Director of Lands, 18 a 1919 decision. Insofar as the
taxing power is concerned, Pineda v. Court of First Instance, a 1929 decision, speaks categorically:
"The Government is never estopped by mistake or error on the part of its agents. It follows that, in so
far as this record shows, the petitioners have not made it appear that the additional tax claimed by
the Collector is not in fact due and collectible. The assessment of the tax by the Collector creates, it
must be remembered, a charge that is at least prima facie valid." 19 That principle has since been
subsequently followed. 20 While the question here is one of the collection of a regulatory fee under
the police power, reliance on the above course of decisions is not inappropriate. There is nothing to
stand in the way, therefore, of the collection of the registration fees from defendant-appellee.
WHEREFORE, the decision of November 24, 1965 is reversed and defendant-appellee ordered to
pay the sum of P78,636.17. With costs against defendant-appellee.