CASE DIGEST: CALTEX V PALOMAR

Caltex vs Palomar

G.R. No. L-19650

29 September 1966

Facts:

      In the year 1960, Caltex conceived a promotional scheme and called it "Caltex  Hooded Pump
Contest". It calls for participants to estimate the actual number of liters a hooded gas pump at each
Caltex Station will dispense during a specified period. For the priviledge to participate, no fees or
consideration, nor purchase of Caltex products were required.

        Forseeing the extensive use of mails relative to the contest, representations were made by Caltex
with the postal authorities for the contest to be cleared in advanced for mailing. The acting Postmaster
General opined that the scheme falls within the purview of sections 1954, 1982 and 1983 of the Revised
Administrative Code and declined to grant the requested clearance. 

Issues:

         W/N construction should be employed in this case and W/N the contest violates the provisions of
the Postal Law

Held: 

         Yes. Construction of a law is in order if what is in issue is an inquiry into the intended meaning of
the words used in a certain law. As defined in Black's Law Dictionary: Construction is the art or process
of discovering and expounding the meaning and intention of the author's of the law with respect to a
given case, where that intention is rendered doubtful, amongst others, by reason of the fact that the
given case is not explicitly provided for in the law. In the present case, the prohibitive provisions of the
Postal Law inescapably require an inquiry into the intended meaning of the words therein. This is as
much as question of construction or interpretation as any other. The Court is tasked to look beyond the
fair exterior, to the substance, in order to unmask the real element and pernicious tendencies that the
law is seeking to prevent.

         Lottery extends to all schemes for the distribution of prize by chance. The three essential elements
of a lottery are: (1) consideration, (2) prize, and (3) chance. Gift enterprise is commonly applied to a
sporting artifice under which goods are sold for their market value but by way of inducement, each
purchaser is given a chance to win a prize. Gratuitous distribution of property by lot or chance does not
constitute lottery. In the present case, the element of consideration is not observed. No payment or
purchase of a merchandise was required for the priviledge to participate.

How did the SC in the case of C vs P, define StatCon? Was it original defintion by the SC or did it merely
cite a previous definition

With regard to Caltex vs. Palomar, the Supreme Court defined Statutory Construction as an art
of process of discovering and expounding the meaning and its intention of the authors of the law
with respect to its application to a given case. Intention  is rendered doubtful among others, by
reason of the fact that the given case is not explicitly provided for in the law. 

The said definition by the Supreme Court was taken from Black's Construction and
Interpretation of the Laws which as well as defined as a process of discovering and expounding
on intended signification of the language used which the meaning authors of the law designed it
to convey to others.

This cited in the case of Caltex vs. Palomar because the issue is an inquiry into the intended
meaning of the words used in a certain law. The prohibitive provisions of the Postal Law
necessarily require an inquiry into the intended meaning of the words used - a question for of
construction or interpretation as any other. The Court is tasked to look beyond the fair exterior,
the substance, in order to unmask the real element and tendencies that the law is seeking to
prevent.