Republic of the Philippines

COURT OF APPEALS
Manila

SIXTH DIVISION

TOYOTA BALINTAWAK, CA-G.R. SP NO. 153160

INC.,
Petitioner,

- versus -

HON. RAMON M. LOPEZ, in

his capacity as the
SECRETARY OF THE
DEPARTMENT OF TRADE
AND INDUSTRY and
MARILOU S. TAN,
Respondents.
x-------------------x
TOYOTA MOTOR PHILS. CA-G.R. SP NO. 154674
CORP.,
Petitioner, Members:
BATO, JR., Chairperson,
- versus - GALAPATE-LAGUILLES, and
*
ONG, JJ.
SECRETARY OF THE
DEPARTMENT OF TRADE
AND INDUSTRY and Promulgated:
MARILOU S. TAN, FEB 28, 2020
Respondents. ___________________
x--------------------------------------------------x
DECISION
BATO, JR., J.:

Before Us are two separate Petitions for Certiorari under

Rule 65 of the 1997 Rules of Civil Procedure, filed by petitioners
Toyota Balintawak Inc. (TBI) and Toyota Motor Philippines
Corporation (TMPC), respectively, assailing the Decision 1 dated 17
August 2017 of the Department of Trade and Industry (DTI), rendered
“FOR THE SECRETARY” by DTI Undersecretary Atty. Rowel S.

*
(Acting) Junior Member for 15 working days per Office Order No. 66-20-RSF dated February
21, 2020.
1
CA-G.R. SP No. 153160 Rollo, pp. 29-37.
CA-G.R. SP NO. 153160 2
CA-G.R. SP NO. 154674
DECISION

Barba, affirming in toto the Decision 2 dated 12 October 2016, issued

by Acting Arbitration Officer Jesus Radmar T. Resente (Resente),
approved by Atty. Genaro C. Jacob, Chief, Adjudication Division, in
Admin Case No: CC 16-256, the dispositive portions of which reads:

“WHEREFORE, in view of the above premises, Judgment is

hereby rendered ordering Respondents TOYOTA MOTOR
PHILIPPINES, INC. & TOYOTA MOTOR BALINTAWAK INC to
jointly:

1. Either replace the product by another of the same kind or

reimbursement of the amount paid by the Complainant subject to
monetary updating at complainant's option and at the expense of
herein Respondents.

2. Pay the Administrative Fine of Two Hundred Forty Thousand

Pesos (Php 240,000.00) pursuant to the Table of Fines under
Department Administrative Order No. 6, Series of 2007, Article 164
of the Consumer Act of the Philippines and Rule XIII, Section 2 of
the Department Administrative Order No. 7, Series of 2006, payable
at 1st Floor, UPRC Building, 315 Sen. Gil Puyat Ave., Makati City.

SO ORDERED.”

The factual and procedural antecedents, as culled from the

pleadings and annexes submitted by the parties are as follows:

On 17 May 2016, for a consideration of the sum of

Php1,476,000.00, private respondent Marilou S. Tan (TAN)
purchased from TBI a Toyota Fortuner 4x2 2.4L G DSL A/T-B3, with
Engine No. 2GD-C033373, Model No. GUN165L-SDTSHM, and
Conduction Sticker No. VC8983, 2016 Model (subject vehicle). 3 On
even date, after it was delivered to TAN, while her husband George
Tan was driving home the subject vehicle from TBI, they noticed a
“jerky movement” whenever there was a change of gear in its
transmission. TAN immediately relayed the matter to Mishel Castro,
sales agent of TBI, who told her that the subject vehicle may have
been stocked up so using it may, in time, cause the defect to
disappear. A week after its release, TAN brought the subject vehicle
to TBI, but it was not accepted for lack of appointment. On 13 June
2016, TAN's husband brought the subject vehicle to TBI for service
check up and repair of the “shift shock”. After a mechanical
inspection by the Technical Department of TBI, TAN's husband was
informed that the defect in the transmission was brought about by the
2
CA-G.R. SP No. 153160 Rollo, pp. 89-95.
3
See Vehicle Sales Invoice , id. at 49.
CA-G.R. SP NO. 153160 3
CA-G.R. SP NO. 154674
DECISION

“fast fill duration of the Automatic Transmission Fluid that was

controlled by the ECU software” and there is a need to replace the
transmission assembly and/or to reprogram the ECU without cost to
TAN. In the meeting held on 28 and 29 June 2016, TAN demanded
that the subject vehicle be replaced or the money paid be refunded.
However, TBI informed TAN that under the Lemon Law it is allowed at
least four (4) repair attempts before she can avail of the replacement
of the subject vehicle. Thus, in a letter dated 1 July 2016, addressed
to TAN, TBI's Assistant Customer Relations Manager Karla Andres
Sagala (Sagala) formally rejected TAN's demand and again offered to
replace the automatic transmission assembly or reprogram the ECU
“by August 31, 2016 at no cost” to TAN.4 By way of reply, in her letter
dated 4 July 2016, TAN noted TBI's “final decision” not to replace the
subject vehicle or refund the money so she informed TBI that she “will
go to the proper venue to exercise her right as a consumer.” 5

On 5 July 2016, TAN filed a Letter Complaint 6 against TBI and

TMPC, before the DTI, docketed as Admin Case No. CC 16-256,
alleging, among others, that she purchased a brand new vehicle
using her hard earned money; that TBI and TMPC committed “unfair
business practice” when they delivered to her a vehicle with a
defective transmission; that the transmission plays a major role in the
overall performance of a vehicle; that by releasing a vehicle with a
defective transmission, TBI and TMPC violated her right as a
consumer; that TBI and TMPC are at fault and negligent in allowing a
defective vehicle to be released; that since the defective transmission
can be repaired only after two (2) and half months, she demanded for
the replacement of the subject vehicle or to refund the money that
she paid; and that under Article 100 of the Consumer Act of the
Philippines “[i]f the imperfection of the product cannot be corrected
within 30 days the consumer may demand for a replacement of the
unit or the immediate reimbursement of the amount paid with
monetary updating without prejudice to any losses and damages.”
Subsequently, on 13 July 2016, TAN subscribed her complaint before
DTI Adjudication Officer Sherwin P. Te.

On 8 July 2016, DTI issued a Notice of Mediation informing the

parties to be present during the mediation conference to be held on
13 July 2016, 9:00 AM at the 3rd Floor of UPRC Bldg.

On 14 July 2016, DTI Adjudication Officer Divina Gracia Bacal

4
Id. at 38.
5
Id. at 39.
6
Id. at 47.
CA-G.R. SP NO. 153160 4
CA-G.R. SP NO. 154674
DECISION

directed the parties to submit within five (5) working days their
respective Position Papers.

In its Position Paper dated 26 July 2016, TBI interposed the

defense that the complaint filed by TAN should be dismissed for
failure to state a cause of action. Before TAN can demand for a
refund of the purchase price or replacement of the subject vehicle,
she should comply with the requirements of Republic Act (RA) No.
10642, otherwise known as the Philippine Lemon Law (Lemon Law),
which is the applicable law. Specifically, as provided under the
Lemon Law, for TAN to be allowed a refund or replacement of a
motor vehicle on the ground of “defect or non-conformity”, TBI should
be allowed a reasonable opportunity to repair the subject vehicle
under Section 5 (at least four separate repair attempts). TAN should
also file a written notice of availment of her right under Section 6
(filing of a written notice of availment of Lemon Law Rights) and
Section 7 (availment of Lemon Law Rights). TBI also asserted that
Article 100 of the Consumer Act, cited by Tan, is not applicable to the
case at bar.

In its Position Paper7 dated 27 July 2016, TMPC prayed for the
dismissal of the Complaint for failure to comply with indispensable
requirements of the Lemon Law. It argued that the instant case is
covered by the Lemon Law and not the Consumer Act because the
subject vehicle was a brand new vehicle delivered to TAN on 17 May
2016. For TMPC, the remedy of refund of the purchase price can
only be availed by TAN after complying with the “specific obligations”
under Section 5 by giving the manufacturer or dealer the opportunity
to repair the vehicle at least on four (4) separate attempts. As shown
in the Affidavits of Reyman Viadoy8 and Argel Joseph Marcellana9,
TAN and her husband did not allow either TMPC or TBI, as
manufacturer and dealer, respectively, the opportunity to conduct
repairs on the subject vehicle, on even a single instance, despite
repeated attempts from 14 June 2016 up to 13 July 2016 to secure
TAN and her husband's consent to replace the transmission
assembly or reprogram the ECU.

On 1 August 2016, TAN filed her Position Paper 10 reiterating

that RA No. 7394, otherwise known as the Consumer Act of the
Philippines, is applicable. As a consumer, she is entitled to choose
7
CA-G.R. SP No. 154674 Rollo, pp. 40-56.
8
Annex “A” to the Position Paper, Id. at 57-58.
9
Annex “B” to the Position Paper, Id. at 59-60.
10
CA-G.R. SP No. 153160 Rollo, pp. 287-291.
CA-G.R. SP NO. 153160 5
CA-G.R. SP NO. 154674
DECISION

between replacement of the defective product or refund of the money

paid because the manufacturer irresponsibly and negligently released
a defective product. The transmission assembly is a major
component of the subject vehicle. The defect existed when she
purchased the vehicle and she complied with the rule on notification
when she immediately reported the defect to Mishel Castro, the sales
agent. It took more than one week before the dealer inspected the
subject vehicle. After inspecting the subject vehicle, she was told to
wait for three to four weeks before they can replace the transmission
assembly. The requirement of four (4) repairs under the Lemon Law
cannot be applied to her due to the non-availability of the
transmission assembly and the manufacturer could not provide the
necessary repair on her first attempt for repair.

On 9 September 2016, TAN voluntarily brought to TBI the

subject vehicle for change oil and for “ECU reprogramming”.
Through “ECU reprogramming” by TMPC's technician, at no cost to
TAN, the “shift shock” problem was addressed and the subject
vehicle was released the following day to TAN.

On 2 and 3 November 2016, TBI and TMPC, respectively,

received a copy of the Decision dated 12 October 2016 rendered by
Acting Arbitration Officer Resente. Both filed their respective
Memorandum of Appeal.

On 17 August 2017, DTI Undersecretary Atty. Rowel S. Barba

(Barba) rendered the assailed Decision affirming in toto the Decision
dated 12 October 2016 of Acting Arbitrator Officer Resente.

On 5 October 2017, TMPC filed its Motion for Reconsideration.

In the Order dated 5 December 2017, which was received by

TMPC on 19 December 2017, Undersecretary Barba denied TMPC's
Motion for Reconsideration.

On 22 February 2018, TMPC filed a Petition for Certiorari,

docketed as CA-G.R. SP No. 154674, which was raffled to the then
Court of Appeals (CA) Sixth Division. The DTI, through the Office of
the Solicitor General (OSG), filed its Comment dated 25 June 2018.
Earlier, without filing a Motion for Reconsideration, TBI filed on 27
October 2017 its Petition for Certiorari, docketed as CA-G.R. SP No.
153160, which was raffled to the undersigned ponente. The DTI,
through the OSG, filed its Comment dated 1 March 2018.
CA-G.R. SP NO. 153160 6
CA-G.R. SP NO. 154674
DECISION

In its Resolution11 dated 24 May 2018, considering the

similarities of parties and issues, the then CA Sixth Division ordered
the consolidation of CA-G.R. SP No. 154674 with CA-G.R. SP No.
153160. The consolidation was accepted in the then CA Eleventh
Divisions Resolution12 dated 25 June 2018. Thereafter, the parties
submitted their respective memoranda on the merits.

In CA-G.R. SP No. 153160, TBI anchored its Petition for

Certiorari on the following grounds:

I
THE PUBLIC RESPONDENT DTI SECRETARY COMMITTED
GRAVE ABUSE OF DISCRETION AND SERIOUS ERROR IN NOT
FINDING THAT THE COMPLAINT IS DISMISSIBLE FOR FAILURE
TO STATE A CAUSE OF ACTION.

A. PRIVATE RESPONDENT NEVER GAVE THE

MANUFACTURER/DEALER THE OPPORTUNITY TO
ADDRESS THE CONCERN, PARTICULARLY PURSUANT
TO THE PROVISIONS OF THE PHILIPPINE LEMON LAW,
PRIOR TO THE FILING OF THE COMPLAINT WITH DTI.

B. ARTICLE 100 OF THE CONSUMER ACT IS NOT

APPLICABLE.

II
THE PUBLIC RESPONDENT DTI SECRETARY COMMITTED
GRAVE ABUSE OF DISCRETION AND SERIOUS ERROR IN NOT
RULING THAT THE COMPLAINT LACKS FACTUAL AND LEGAL
BASES. THE MOTOR VEHICLE HAS NO DEFECT/
IMPERFECTION THAT CANNOT BE ADDRESSED AND
UNDERWENT (SIC) RIGOROUS QUALITY CHECK.

A. AS A MATTER OF FACT, THE CONCERN OF THE MOTOR

VEHICLE WAS ALREADY RESOLVED THAT RENDERS
THE CASE MOOT AND ACADEMIC.

B. THE IMPOSITION OF A HUGE ADMINISTRATIVE FINE IS

BEREFT OF ANY FACTUAL AND LEGAL BASES.13

Likewise, in CA-G.R. SP No. 154674, TMPC anchored its

Petition for Certiorari on the following grounds:

I
THE PUBLIC RESPONDENT COMMITTED GRAVE ABUSE OF

11
CA-G.R. SP No. 154674 Rollo, p. 215.
12
CA-G.R. SP No. 153160 Rollo, p. 347.
13
Id. at 12.
CA-G.R. SP NO. 153160 7
CA-G.R. SP NO. 154674
DECISION

DISCRETION AMOUNTING TO LACK OR EXCESS OF

JURISDICTION IN AFFIRMING THE DECISION OF THE ACTING
ARBITRATION OFFICER THAT PETITIONER TMPC VIOLATED
THE CONSUMER ACT.

II
THE PUBLIC RESPONDENT COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION IN DISREGARDING EVIDENCE OF
SUPERVENING EVENTS PRESENTED BY PETITIONER TMPC
IN ITS MOTION FOR RECONSIDERATION THAT WOULD HAVE
RENDERED THE INSTANT CASE MOOT AND ACADEMIC.14

On the other hand, the DTI, through the OSG, in its Comment
prayed for the denial of the petitions based on the following
ratiocinations:

I
THE PETITION SHOULD BE DENIED FOR FAILURE TO
ESTABLISH THAT THE DECISION OF PUBLIC RESPONDENT
DTI SECRETARY IS TAINTED WITH GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION.

A. THE LAW APPLICABLE IN THIS CASE IS THE

CONSUMER ACT OF THE PHILIPPINES. THE
ENACTMENT OF THE LEMON LAW DOES NOT
PRECLUDE OTHER REMEDIES AVAILABLE TO
CONSUMERS.

B. PUBLIC RESPONDENT WAS CORRECT TO HOLD

PETITIONER LIABLE IN FAVOR OF PRIVATE
RESPONDENT UNDER ARTICLE 100 OF THE
CONSUMER ACT OF THE PHILIPPINES.

C. THE CASE WAS NOT RENDERED MOOT AND

ACADEMIC BY THE SUPPOSED SUBSEQUENT
REPAIR OF THE VEHICLE.

D. EVEN ASSUMING THE PHILIPPINE LEMON LAW

APPLIES IN THIS CASE, THERE WAS SUBSTANTIAL
COMPLIANCE WITH THE REQUIREMENTS OF THE
PHILIPPINE LEMON LAW.

E. PUBLIC RESPONDENT'S IMPOSITION OF A FINE

AGAINST PETITIONER IS SUPPORTED BY FACT AND
LAW.15

14
CA-G.R. SP No. 154674 Rollo, p. 11.
15
CA-G.R. SP No. 153160 Rollo, pp. 263-264.
CA-G.R. SP NO. 153160 8
CA-G.R. SP NO. 154674
DECISION

The issues for resolution are: (1) whether the instant case is
now moot and academic; and (2) whether the DTI committed grave
abuse of discretion amounting to lack or excess of jurisdiction in
ordering TBI and TMPC, jointly, to replace the subject vehicle or
refund the amount paid and to pay the administrative fine amounting
to Php240,000.00.

On the first issue, TMPC and TBI argue that the instant case
was rendered moot and academic because after the submission of
their position papers, TAN allowed the necessary repair to be
undertaken when she brought the subject vehicle to TBI for ECU
reprogramming. After the repair, which corrected the “shift shock”,
TAN never came back to complain about the defect of the subject
vehicle.

We are not persuaded.

As ruled by the Supreme Court, an issue is considered moot

and academic when it ceases to present a justiciable controversy so
that a declaration thereon would be of no practical use or value. In
such a case, there is no actual substantial relief to which a party
would be entitled to and would be negated. 16 Under the moot and
academic doctrine, the Courts will abstain from expressing its opinion
or resolving the case if no legal relief is needed or called for. 17 Here,
the repair of the subject vehicle will not render moot and academic
the instant petitions for the simple reason that notwithstanding the
repair of the subject vehicle, this Court has to resolve the substantive
issues raised in the petitions. In other words, the resolution of the
substantive issues has a practical use or value for the parties.
Besides, even if the case is moot and academic, by way of
exceptions, courts may resolve the case if there is “a compelling
constitutional issue raised [which] requires the formulation of
controlling principles to guide the bench, the bar and the public; or
when the case is capable of repetition yet evading judicial review.” 18

Now, on the second issue.

Traditionally, by grave abuse of discretion is meant such

capricious and whimsical exercise of judgment as is equivalent to
16
Southeast Asia Manufacturing Corporation v. The Municipal Council of Tagbilaran, 94 SCRA
341; Gancho-on v. Secretary of Labor and Employment, 271 SCRA 204.
17
Baring v. CA, G.R. No. 141746, 15 December 2005; Desaville, Jr. v. CA, G.R. No. 128310, 13
August 2004.
18
Osmeña III v. SSS of the Philippines, G.R. No. 165272, 13 September 2007.
CA-G.R. SP NO. 153160 9
CA-G.R. SP NO. 154674
DECISION

lack of jurisdiction, and it must be shown that the discretion was

exercised arbitrarily or despotically. 19 The abuse of discretion must
be patent and gross as to amount to an evasion of positive duty or to
a virtual refusal to perform a duty enjoined by law, as not to act at all
in contemplation of law or where power is exercised in an arbitrary
and despotic manner by reason of passion or hostility. 20 Its expanded
meaning, however, already includes acts done contrary to the
Constitution, the law, or jurisprudence. 21 Also, manifest disregard of
the “rules, processes and guidelines” constitutes grave abuse of
discretion.22

In the case at bar, after a painstaking evaluation of the

arguments presented by the parties, We rule that the DTI committed
grave abuse of discretion amounting to lack or excess of jurisdiction
in rendering the Assailed Decision.

First. It must be emphasized that the subject matter of the

controversy is a brand new motor vehicle. At the time the subject
vehicle was purchased and delivered on 17 May 2016, while driving
home, TAN and her husband noticed a defect in the “shift shock”
which was immediately reported to TBI's Sales Agent Mishel Castro.
After an inspection conducted by the Technical Department of TBI,
TAN's husband was informed that the defect in the transmission was
brought about by the “fast fill duration of the Automatic Transmission
Fluid that was controlled by the ECU software” and there was a need
to replace the transmission assembly or to reprogram the ECU.

With the defect in the transmission assembly validated by TBI,

under the Lemon Law, TAN can legally invoke her rights as a
consumer for the repair of the subject vehicle. Under the law, aside
from its express warranty, TMPC is legally obligated to repair and/or
replace the defective parts of the subject vehicle. Explicitly, under
Section 5 thereof “repair may include the replacement of parts
components or assemblies.” However, for one to avail of the remedy
provided under the said law, the provisions of Sections 5, 6 and 7
must be complied, viz.:

“Section 5. Repair Attempts. – At any time within the Lemon Law

rights period, and after at least four (4) separate repair attempts by
19
PMI Colleges v. NLRC, et al., G.R. No. 121466, 15 August 1997.
20
Panaligan v. Adolfo, 67 SCRA 176.
21
Information Technology Foundation of the Philippines v. Commission on Elections, 419 SCRA
141.
22
National Artist For Literature Virgilio Almario, et al. v. The Executive Secretary, et al., G.R. No.
189028, 16 July 2013.
CA-G.R. SP NO. 153160 10
CA-G.R. SP NO. 154674
DECISION

the same manufacturer, distributor, authorized dealer or retailer for

the same complaint, and the nonconformity issue remains
unresolved, the consumer may invoke his or her rights under this
Act.

The repair may include replacement of parts components, or

assemblies.

Section 6. Notice of Availment of Lemon Law Rights. – Before

availing of any remedy under this Act and subject to compliance
with the provisions of Section 5 hereof, the consumer shall, in
writing, notify the manufacturer, distributor, authorized dealer or
retailer of the unresolved complaint, and the consumer’s intention
to invoke his or her rights under this Act within the Lemon Law
rights period.

The warranty booklet issued by the manufacturer, distributor,

authorized dealer or retailer shall clearly state the manner and form
of such notice to constitute a valid and legal notice to the
manufacturer, distributor, authorized dealer or retailer. It shall also
clearly state the responsibility of the consumer under this section.

Section 7. Availment of Lemon Law Rights. – Subsequent to filing

the notice of availment referred to in the preceding section, the
consumer shall bring the vehicle to the manufacturer, distributor,
authorized dealer or retailer from where the vehicle was purchased
for a final attempt to address the complaint of the consumer to his
or her satisfaction.

It shall be the duty of the manufacturer, distributor, authorized

dealer or retailer, upon receipt of the motor vehicle and the notice of
nonconformity required under Section 6 hereof, to attend to the
complaints of the consumer including, as may be necessary,
making the repairs and undertaking such actions to make the
vehicle conform to the standards or specifications of the
manufacturer, distributor, authorized dealer or retailer for such
vehicle.

In case the nonconformity issue remains unresolved despite the

manufacturer, distributor, authorized dealer or retailer’s efforts to
repair the vehicle, pursuant to the consumer’s availment of his or
her Lemon Law rights, the consumer may file a complaint before
the DTI as provided for under this Act: Provided, however, That if
the vehicle is not returned for repair, based on the same complaint,
within thirty (30) calendar days from the date of notice of release of
the motor vehicle to the consumer following this repair attempt
within the Lemon Law rights period, the repair is
deemedsuccessful: Provided, finally, That, in the event that the
nonconformity issue still exists or persists after the thirty (30)-day
period but still within the Lemon Law rights period, the consumer
may be allowed to avail of the same remedies under Sections 5 and
CA-G.R. SP NO. 153160 11
CA-G.R. SP NO. 154674
DECISION

6 hereof.

To compensate for the non-usage of the vehicle while under repair

and during the period of availment of the Lemon Law rights, the
consumer shall be provided a reasonable daily transportation
allowance, an amount which covers the transportation of the
consumer from his or her residence to his or her regular workplace
or destination and vice versa, equivalent to air-conditioned taxi fare,
as evidenced by official receipt, or in such amount to be agreed
upon by the parties, or a service vehicle at the option of the
manufacturer, distributor, authorized dealer or retailer. Any
disagreement on this matter shall be resolved by the DTI.

Nothing herein shall be construed to limit or impair the rights and

remedies of a consumer under any other law. ”

Complementing the aforestated provisions of law, DTI issued

the Implementing Rules and Regulations (IRR) under Department
Administrative Order No. 14-3, Series of 2014, the pertinent portion of
which provides:

“Title ll
Procedures in Availing Lemon Law Rights
Rule I
Repair Attempt

Section 1. Repair Attempts. The provision in Section 5 of the law

on Repair Attempts is here by adopted.

Section 2. Repair Attempt Process. A completed repair/job order

constitutes one repair attempt by undergoing the process out lined
below.

2.1. The Consumer and/or representative, specifically

authorized in writing by the Consumer, bring the motor
vehicle to the same authorized Dealer report and/or
demonstrate the complaint on the Motor Vehicle.
2.2. The Dealer, at all times, shall receive the motor vehicle,
and records the consumer's complaint on the Motor Vehicle.
2.3. The Dealer shall advise the Consumer for the proposed
repair(s) and the estimated time to complete the repair(s).
2.4. The Consumer authorizes the repair by affixing his/her
signature on the repair/job order.
2.5. The Dealer, upon completion of the repair activity,
releases the motor vehicle to the consumer and shall provide
the Consumer with an inventory of repairs done as
completed and parts replaced.
2.6. The Dealer returns the parts replaced and furnishes the
results of any test activity which was performed if, any.
CA-G.R. SP NO. 153160 12
CA-G.R. SP NO. 154674
DECISION

2.7. Consumer receives the unit and if the motor vehicle is

not returned within fifteen(15) days from release, the repair is
deemed accepted.
2.8. Any Repair covered by the Manufacturer's Warranty
shall not be charged for labor and parts.

Section3. Repair Attempt Not Completed. A repair attempt that is

started but not completed by the dealer for reason attributable to
the dealer shall be treated as one repair attempt.

Rule ll
Notice of Availment of Lemon Law Rights

Section 1. Notice to Manufacturer, distributor, authorized dealer or

retailer.
In case the non conformity issue remains unresolved after four (4)
separate Repair Attempts, the Consumer shall, in writing, notify the
manufacturer, distributor, authorized dealer or retailer of the
unresolved complaint and the Consumer shall invoke the Lemon
Law rights and serving notices to all Parties through, courier,
personal delivery or postal services with proof of service and
receipt.

Section 2. Responsibilities of the Consumer. The warranty booklet

shall clearly state the responsibilities of the consumer as follows:

2.1. The Consumer shall keep copy of repair records;

2.2. The Consumer shall ensure that the odometer reading
or the date of vehicle delivery for Final Attempt at the
servicing dealer is within the Lemon Law rights period.
2.3. The Consumer, shall in writing and in the form
prescribed in the Warranty Booklet (the Notice of Availment
form), notify the manufacturer, distributor, authorized dealer
or retailer of the unresolved complaint after four (4) separate
repair attempts; and
2.4. The Consumer shall likewise retain the documentary
requirements specified in Section 2, Rule III of these rules.

Section3. Final Repair Attempt. The consumer shall bring the

vehicle to the manufacturer, distributor, authorized dealer or retailer
from where the vehicle was purchased for a final attempt to
address the complaint of the consumer to his or her satisfaction.

Rule lll
Availment of Lemon Law Rights

Section 1. Availment of Lemon Law Rights. The process of

availment stated in Section 7 of the law is hereby adopted. The
complaint shall be filed by the consumer with the DTI office within
the period provided by Lemon Law. Otherwise the right to file the
same shall be deemed prescribed. In accordance with Section 3(h)
CA-G.R. SP NO. 153160 13
CA-G.R. SP NO. 154674
DECISION

thereof.

x x x”

Ostensibly, as borne out by the records, at the time TAN filed

her Letter Complaint on 5 July 2016 with the DTI, she failed to comply
with the requirements of the law. Specifically, TAN did not authorize
TBI/TMPC to repair the subject vehicle when she did not affix her
signature on the repair/job order. For one repair attempt to be
completed, Section 2 (2.4), Rule 1 of the IRR of RA No. 10642,
provides that “[t]he Consumer authorizes the repair by affixing his/her
signature on the repair/job order.” Based on the Affidavits of Reyman
Viadoy and Argel Joseph Marcellana, TAN and her husband did not
allow either TMPC or TBI, as manufacturer and dealer, respectively,
the opportunity to conduct repairs on the subject vehicle. In fact,
during the meetings held on 28 and 29 June 2016, TAN and her
husband refused to give their consent to the replacement of the
transmission assembly or the reprogramming of the ECU. Instead,
they demanded for the replacement of the subject vehicle or to refund
the money they paid. TBI informed TAN that under the Lemon Law, it
is allowed at least four (4) repair attempts before she can avail of the
replacement of the subject vehicle. Thus, in a letter dated 1 July
2016, addressed to TAN, TBI's Assistant Customer Relations
Manager Sagala formally rejected TAN's demand and again offered
to replace the automatic transmission assembly or reprogram the
ECU at no cost to TAN. In her letter dated 4 July 2016, TAN rejected
TBI's offer to repair the subject vehicle and informed TBI that she “will
go to the proper venue to exercise her right as a consumer.”

Apparently, when TAN filed her Letter Complaint with the DTI,
aside from not complying with Section 5, TAN did not also notify in
writing TBI and TMPC of her intention to invoke her rights as a
consumer in accordance with Sections 6 and 7 of the Lemon Law.

Undoubtedly, in entertaining the complaint filed by TAN knowing

fully well the effectivity in 2014 of the Lemon Law and its IRR, the DTI
clearly committed grave abuse of discretion amounting to excess of
jurisdiction. Rules must be followed, otherwise, they will become
meaningless and useless.23 In the case of National Artist For
Literature Virgilio Almario, et al. v. The Executive Secretary, et al., 24
the Supreme Court En Banc unequivocally declared that the manifest
disregard of the “rules, processes and guidelines” constitutes grave
23
Spouses Bergonia v. Court of Appeals, G.R. No. 189151, 25 January 2012.
24
G.R. No. 189028, 16 July 2013.
CA-G.R. SP NO. 153160 14
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DECISION

abuse of discretion. This is because tribunals or bodies exercising

judicial or quasi-judicial power must follow the rules, otherwise, in
disregarding the rules they are bound to observe they committed
grave abuse of discretion.25

Second. Under the Lemon Law, in order that the DTI can
legally grant to a buyer of a brand new motor vehicle the relief of
refund of the money paid or replacement of a similar or comparable
motor vehicle, the following conditions must be satisfied: (a) there
must be a finding by the DTI of “noncomformity” which “refers to
any defect or condition that substantially impairs the use, value
or safety of a brand new motor vehicle which prevents it from
conforming to the manufacture's or distributor's standards or
specifications, which cannot be repaired, but excluding conditions
resulting from noncompliance by the consumer of his or her
obligations under the warranty, modifications not authorized by the
manufacturer or distributor, abuse or neglect, and damage due to
accident or force majeure;” and (b) the findings of the DTI must be
supported by an “independent qualified expert” on the existence of
defect or condition that “substantially impairs the use, value or safety”
of the subject vehicle.

Expressly, Section 8 (c) of RA No. 10642, provides:

“(c) Adjudication

(1) In the event that both parties do not undertake arbitration

proceedings, at least one of the parties may commence
adjudication proceedings, administered by the DTI. The DTI
shall rely on the qualified independent findings as to
conformity to standards and specifications established
herein. In no case shall adjudication proceedings exceed
twenty (20) working days;

(2) In case a finding of nonconformity is arrived at, the DTI

shall rule in favor of the consumer and direct the
manufacturer, distributor, authorized dealer or retailer to
grant either of the following remedies to the consumer:

(i) Replace the motor vehicle with a similar or comparable

motor vehicle in terms of specifications and values, subject
to availability; or
(ii) Accept the return of the motor vehicle and pay the
consumer the purchase price plus the collateral charges.

25
Angel Jardin, et al. vs. NLRC, G.R. No. 119268, February 23, 2000.
CA-G.R. SP NO. 153160 15
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DECISION

In case the consumer decides to purchase another vehicle

with a higher value and specifications from the same
manufacturer, distributor, authorized dealer or retailer, the
consumer shall pay the difference in cost.

In both cases of replacement and repurchase, the

reasonable allowance for use, as defined in this Act, shall be
deducted in determining the value of the nonconforming
motor vehicle; and

(3) In case a nonconformity of the motor vehicle is not found

by the DTI, it shall rule in favor of the manufacturer,
distributor, .authorized dealer or retailer, and direct the
consumer to reimburse the manufacturer, distributor,
authorized dealer or retailer the costs incurred by the latter in
validating the consumer’s complaints. ” (Emphasis supplied)

Corollarily, Section 5, Rule I, Title III of the IRR of RA No. 10624

provides:

“Section 5. Retention of Service of other Government Agencies or

Qualified Independent Entities to Ascertain Consumer Gomplaint
Validity. In ascertaining the validity of the Consumer's complaint,
the DTI shall request the assistance from the pool of qualified
personnel of the Technical Education and Skills Development
Authority (TESDA) or any independent private entity. An
independent qualified expert may be anyone of the following:

5.1. Technicians who have the highest or appropriate and

relevant TESDA national certification level. TESDA shall
further develop competencies and certification programs for
qualified experts to match current and future automotive
technologies and to complement and broaden the expert's
skill set.
5.2. Experts coming from the industry.
5.3. DTI accredited service and repair shops.

Provided, however that experts above-mentioned shall not have

any conflict of interest with respect to the case.”

Clearly, the DTI exceeded its jurisdiction when it granted the

relief of refund of the money paid or replacement of the subject
vehicle, despite the absence of the DTI's findings of “nonconformity”
supported by the findings of “an independent qualified expert”. The
ruling of DTI Acting Arbitration Officer Resente that the “defect on the
transmission assembly is a major issue considering that it is not safe
to operate a motor vehicle with a defective shift gear” is a layman's
opinion not supported by an independent expert opinion required
CA-G.R. SP NO. 153160 16
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DECISION

under the Lemon Law and its IRR. Besides, there are no findings of
the DTI to the effect that the defect in the transmission assembly
constitutes “nonconformity” or “a defect or condition that substantially
impairs the use, value or safety of a brand new motor vehicle which
prevents it from conforming to the manufacture's or distributor's
standards or specifications.” Stated differently, there are no findings
of the DTI that the defect in the “shift shock” is a “nonconformity” that
could not be corrected by replacing the transmisssion assembly or by
“reprogramming the ECU”. Notably, from the pleadings on record,
neither TAN nor the OSG controverted the claim of TBI and TMPC
that the problem in the “shift shock” was addressed on 9 September
2016 when TMPC's technician reprogrammed the ECU, at no cost to
TAN.

Third. We agree with TBI and TMPC that in the resolution of

the dispute between the parties, the applicable law is RA No. 10642,
otherwise known as the Philippine Lemon Law, and not RA No. 7394,
the Consumer Act of the Philippines. This is because the Lemon Law
is a special law that governs the purchase of a brand new motor
vehicle. Unequivocally, Section 4 of RA No. 10642 provides that
“This Act shall cover brand new motor vehicles purchased in the
Philippines reported by a consumer to be in nonconformity with the
vehicle's manufacturer or distributor's standards or specifications
within twelve (12) months from the date of original delivery to the
consumer, or up to twenty thousand (20,000) kilometers of operation
after such delivery, whichever comes first.” Section 3 (a) thereof
defines a brand new vehicle as “a vehicle constructed entirely from
new parts and covered by a manufacturer's express warranty at the
time of purchase that it has never been sold or registered with the
Department of Transportation and Communications (DOTC) or an
appropriate agency or authority, and has never been operated on any
highway of the Philippines, or in any foreign state or country.”
Moreover, the Lemon Law not only defines the rights and obligations
of the parties involved in the purchase of a brand new vehicle, but
also provides “the means for redress for violations thereof.”

On the other hand, RA No. 7394, is a general law that covers

transactions for the purchase of “durable and non-durable” consumer
products. As defined under Article 4 (p) thereof, consumer products
and services “means goods, services and credits, debts or obligations
which are primarily for personal, family, household or agricultural
purposes, which shall include but not limited to food, drugs,
cosmetics, and devices.”
CA-G.R. SP NO. 153160 17
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DECISION

In the case of Vinzons-Chato v. Fortune Tobacco Corporation 26,

the Supreme Court discussed the distinctions and applications of a
special law and a general law, viz.:

“A general statute is one which embraces a class of subjects

or places and does not omit any subject or place naturally
belonging to such class. A special statute, as the term is generally
understood, is one which relates to particular persons or things of a
class or to a particular portion or section of the state only.

A general law and a special law on the same subject are

statutes in pari materia and should, accordingly, be read together
and harmonized, if possible, with a view to giving effect to both. The
rule is that where there are two acts, one of which is special and
particular and the other general which, if standing alone, would
include the same matter and thus conflict with the special act, the
special law must prevail since it evinces the legislative intent more
clearly than that of a general statute and must not be taken as
intended to affect the more particular and specific provisions of the
earlier act, unless it is absolutely necessary so to construe it in
order to give its words any meaning at all.”

The above ruling in Vinzons-Chato v. Fortune Tobacco

Corporation27 was reiterated and amplified in the case of the Office of
the Solicitor General v. Court of Appeals 28, wherein the Supreme
Court further declared that:

“The special act and the general law must stand together,
one as the law of the particular subject and the other as the law of
general application. The special law must be taken as intended to
constitute an exception to, or a qualification of, the general act or
provision.”

In Remo v. Secretary of Foreign Affairs 29, in resolving the

conflict between the application of Title XIII of the Civil Code (a
general law) and RA No. 8239 (a special law) on surnames, the
Supreme Court resolved the conflict by applying the special law. The
Supreme Court ruled:

“[I]t is a familiar rule of statutory construction that to the extent of

any necessary repugnancy between a general and a special law or

26
G.R. No. 141309, 19 June 2007.
27
Id.
28
G.R. No. 199027, 9 June 2014 citing Social Justice Society (SJS), et al. v. Hon. Atienza, Jr.,
568 Phil. 658 (2008).
29
G.R. No. 169202, 5 March 2010 citing Lagman v. City of Manila, 123 Phil. 1439, 1447 (1966)
citing Cassion v. Banco Nacional Filipino, 89 Phil. 560, 561 (1951).
CA-G.R. SP NO. 153160 18
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DECISION

provision, the latter will control the former without regard to the
respective dates of passage.”

Obviously, contrary to the position of the OSG, there exists a

conflict between the procedure under the Lemon Law and the
Consumer Act. While the Lemon Law, as quoted above, allows the
manufacturer of a brand new motor vehicle four (4) “attempts of
repair” and requires from a consumer a written notification of her
availment of the Lemon Law due to “non-conformity” or defect, on the
other hand, the Consumer Act merely provides for thirty (30) days for
the correction of the imperfection of durable or non-durable product
before an aggrieved consumer can demand replacement of the
product or reimbursement of the amount paid. Article 100 of the
Consumer Act provides, viz.:

“Article 100. Liability for Product and Service Imperfection. – The

suppliers of durable or nondurable consumer products are jointly
liable for imperfections in quality that render the products unfit or
inadequate for consumption for which they are designed or
decrease their value, and for those resulting from inconsistency
with the information provided on the container, packaging, labels or
publicity messages/advertisement, with due regard to the variations
resulting from their nature, the consumer being able to demand
replacement to the imperfect parts.

If the imperfection is not corrected within thirty (30) days, the

consumer may alternatively demand at his option:

a) the replacement of the product by another of the same

kind, in a perfect state of use;
b) the immediate reimbursement of the amount paid, with
monetary updating, without prejudice to any losses and
damages;
c) a proportionate price reduction.

The parties may agree to reduce or increase the term specified in

the immediately preceding paragraph; but such shall not be less
than seven (7) nor more than one hundred and eighty (180) days.

The consumer may make immediate use of the alternatives under

the second paragraph of this Article when by virtue of the extent of
the imperfection, the replacement of the imperfect parts may
jeopardize the product quality or characteristics, thus decreasing its
value.

If the consumer opts for the alternative under sub-paragraph (a) of

the second paragraph of this Article, and replacement of the
product is not possible, it may be replaced by another of a different
CA-G.R. SP NO. 153160 19
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DECISION

kind, mark or model: Provided, That any difference in price may

result thereof shall be supplemented or reimbursed by the party
which caused the damage, without prejudice to the provisions of
the second, third and fourth paragraphs of this Article. ”

Indeed, with the foregoing repugnancy, We have no option but

to apply the elementary rule on statutory construction that a special
law prevails over a general law. 30 Specifically RA No. 10642 being a
subsequent special law must be “regarded as an exception to, or a
qualification of, the prior general act.” 31

Fourth. Unfortunately for TAN, she filed a complaint with the

DTI invoking the Consumer Act. Although, the Consumer Act also
provides for the remedies available to a consumer who purchased a
defective or imperfect product, nonentheless, it can be applied only to
motor vehicles purchased before the enactment in 2014 of the Lemon
Law. It is of public knowledge to which the Court can take judicial
notice that the Lemon Law took effect on 16 September 2014 fifteen
(15) days after its publication in the Official Gazette on 01 September
2014.32 After the effectivity of the Lemon Law, the resolution of
consumer complaints involving the purchase of a brand new motor
vehicle is governed by the provisions of the Lemon Law and its IRR.
Section 2 of the DTI Department Administrative Order No. 14-3,
Series of 2014, the IRR of RA No. 10642, even provides that “These
rules shall apply primarily in the determination and resolution of
Consumer complaints as it relates to Motor Vehicles covered under
the Phillippine Lemon Law. The provisions of Republic Act No. 7394
or 'The Consumer Act of the Philippines', and its Implementing Rules
and Regulations, and other related laws, shall apply where
applicable.” Indeed, following the IRR issued by the DTI, the
Consumer Act can be applied suppletorily only in cases not covered
by the Lemon Law. To adopt the position of the DTI and the OSG
that TAN can invoke the Consumer Act because of the last paragraph
of Section 7 of RA No. 10642 which provides that “[n]othing [in the
law] shall be construed to limit or impair the rights and remedies of a
consumer under any other law” will render nugatory the enactment of
the Lemon Law. Thus, when the DTI applied Article 100 of RA No.
7394 despite the effectivity in 2014 of RA No. 10642, it clearly
committed grave abuse of discretion amounting to excess of
jurisdiction. The DTI also committed grave abuse of discretion when
it did not apply its own IRR in resolving the disputes between the
30
Remo v. Secretary of Foreign Affairs, id.
31
Go, Jr. v. Court of Appeals, et al., G.R. No. 172027, July 29, 2010.
32
See Official Gazette, Vol. 110, No. 35, 1 September 2014.
CA-G.R. SP NO. 153160 20
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DECISION

parties. Again, it must be emphasized that Rules must be followed,

otherwise, they will become meaningless and useless. 33 Manifest
disregard of the “rules, processes and guidelines” constitutes grave
abuse of discretion.34 Tribunals or bodies exercising judicial or quasi-
judicial power must follow the rules, otherwise, in disregarding the
rules they are bound to observe they committed grave abuse of
discretion.35

Fifth. Anent the imposition of joint administrative fine in the sum

of Php240,000.00 on TBI and TMPC, after a review of the pertinent
law and jurisprudence, We rule that the DTI committed grave abuse
of discretion amounting to lack or excess of jurisdiction.

At the outset, it must be pointed out that the power of

administrative officials to issue rules and regulations in the
implementation of a law is limited only in carrying into effect what is
provided in the law. As held in Miners Association of the Philippines,
Inc. v. Factoran, Jr.36:

“We reiterate the principle that the power of administrative

officials to promulgate rules and regulations in the implementation
of a statute is necessarily limited only to carrying into effect what is
provided in the legislative enactment. The principle was enunciated
as early as 1908 in the case of United States v. Barrias. The scope
of the exercise of such rule-making power was clearly expressed in
the case of United States v. Tupasi Molina, decided in 1914, thus:
'Of course, the regulations adopted under legislative authority by a
particular department must be in harmony with the provisions of the
law, and for the sole purpose of carrying into effect its general
provisions. By such regulations, of course, the law itself can not be
extended. So long, however, as the regulations relate solely to
carrying into effect the provision of the law, they are valid.'

Recently, the case of People v. Maceren gave a brief

delineation of the scope of said power of administrative officials:

'Administrative regulations adopted under legislative

authority by a particular department must be in harmony
with the provisions of the law, and should be for the sole
purpose of carrying into effect its general provisions. By
such regulations, of course, the law itself cannot be
extended (U.S. v. Tupasi Molina, supra). An administrative
33
Spouses David Bergonia and Luzviminda Castillo v. Court of Appeals, G.R. No. 189151,
January 25, 2012.
34
National Artist For Literature Virgilio Almario, et al. v. The Executive Secretary, et al., supra
note 22.
35
Angel Jardin, et al. v. NLRC, et al., supra note 25..
36
G.R. No. 98332, 16 January 1995.
CA-G.R. SP NO. 153160 21
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DECISION

agency cannot amend an act of Congress (Santos vs.

Estenzo, 109 Phil. 419, 422; Teoxon vs. Members of the
Board of Administrators, L-25619, June 30, 1970, 33 SCRA
585; Manuel vs. General Auditing Office, L-28952,
December 29, 1971, 42 SCRA 660; Deluao v. Casteel, L-
21906, August 29, 1969, 29 SCRA 350).

'The rule-making power must be confined to details

for regulating the mode or proceeding to carry into effect
the law as it has been enacted. The power cannot be
extended to amending or expanding the statutory
requirements or to embrace matters not covered by the
statute. Rules that subvert the statute cannot be sanctioned
(University of Santo Tomas v. Board of Tax Appeals, 93
Phil. 376, 382, citing 12 C.J. 845-46. As to invalid
regulations, see Collector of Internal Revenue v. Villaflor,
69 Phil. 319; Wise & Co. v. Meer, 78 Phil. 655, 676; Del
Mar v. Phil. Veterans Administration, L-27299, June 27,
1973, 51 SCRA 340, 349).

xxx

'. . . The rule or regulations should be within the

scope of the statutory authority granted by the legislature to
the administrative agency (Davis, Administrative Law, p.
194, 197, cited in Victorias Milling Co., Inc. v. Social
Security Commission, 114 Phil. 555, 558).

'In case of discrepancy between the basic law and a

rule or regulation issued to implement said law, the basic
law prevails because said rule or regulations cannot go
beyond the terms and provisions of the basic law (People v.
Lim, 108 Phil. 1091).'”

Accordingly, for an administrative agency, like the DTI, to

impose fines as a form of an administrative sanction, it must be
expressly provided in the law. In the absence of a law granting an
administrative agency the authority to fix or impose administrative
fines, it cannot provide for such fines in its implementing rules and
regulations.37 This is because as above-quoted “the power of
administrative officials to promulgate rules and regulations in the
implementation of a statute is limited only to carrying into effect what
is provided in the legislative enactment.” 38 In Commissioner of
Internal Revenue v. Court of Appeals 39, the Supreme Court further
declared that “[a]dministrative rules and regulations are intended to
carry out, neither to supplant nor to modify, the law.”

In the case at bar, a cursory examination of RA No. 10642 will

37
Pharmaceutical and Health Care Association of the Philippines v. Duque, III, 535 SCRA 265.
38
Miners Association of the Philippines, Inc. v. Factoran, Jr., supra note 36.
39
G.R. No. 108358, 20 January 1995.
CA-G.R. SP NO. 153160 22
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DECISION

show beyond a penumbra of doubt that the law itself did not provide
for administrative fines for violations of the said law. In other words,
no provision in the law sanctions the imposition of administrative fines
for violation of the Lemon Law. What the Lemon Law provides, by
way of administrative sanction, is the payment by the manufacturer or
dealer of damages to the aggrieved party for acts or omissions in
violation of the Law. Sections 10 and 11 provide:

“Section 10. Disclosure on Resale. – Should the returned motor

vehicle be made available for resale, the manufacturer, distributor,
authorized dealer or retailer shall, prior to sale or transfer, disclose
in writing to the next purchaser of the same vehicle the following
information:

(a) The motor vehicle was returned to the manufacturer,

distributor, authorized dealer or retailer;
(b) The nature of the nonconformity which caused the return;
and
(c) The condition of the motor vehicle at the time of the
transfer to the manufacturer, distributor, authorized dealer or
retailer.

The responsibility of the manufacturer, distributor, authorized dealer

or retailer under this section shall cease upon the sale of the
affected motor vehicle to the first purchaser.

Section 11. Penalty. – The manufacturer, distributor, authorized

dealer or retailer adjudged to have violated the provisions requiring
disclosure as mentioned in the preceding section shall be liable to
pay a minimum amount of One hundred thousand pesos
(P100,000.00) as damages to the aggrieved party without prejudice
to any civil or criminal liability they and/or the responsible officer
may incur under existing laws.”

Inarguably, there is no provision in the Lemon Law, that

provides for an administrative fine for acts or omissions of a
manufacturer or dealer selling to a consumer a brand new motor
vehicle with a defective “shift shock”. Thus, without any express
grant of power to fix or impose such fines in the Lemon Law, the DTI
committed grave abuse of discretion amounting to lack or excess of
jurisdiction when it imposed an administrative fine on TBI and TMPC
due to a defective “shift shock”.

The theory of the DTI, which was adopted by the OSG, that it
can suppletorily apply the provisions of Article 164 (e) of the
Consumer Act which empowers the DTI Secretary to impose
“administrative fines in such amounts deemed reasonable by the
CA-G.R. SP NO. 153160 23
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DECISION

Secretary, which shall in no case be less than Five hundred pesos

(P500.00) nor more than Three hundred thousand pesos
(P300,000.00) depending on the gravity of the offense, and an
additional fine of not more than One thousand pesos (P1,000.00) for
each day of continuing violation” is not supported by law and
jurisprudence. Firstly, there is nothing in the provision of the Lemon
Law that expressly allows the suppletory application of the Consumer
Act for acts done in contravention of the Lemon Law. Secondly, while
Section 2 of Rule I, Title 1 of the IRR of the Lemon Law allows the
suppletorily application of the Consumer Act, the same should not
include the imposition of administrative fines for the simple reason
that it is not expressly provided in the Lemon Law. The IRR cannot
legally provide for an administrative fine not expressly allowed in the
Lemon Law. Settled is the rule that administrative issuances must
not override but must be in harmony with the law they seek to
implement.40 Indeed, for administrative fines to be legally imposed,
whether as an administrative sanction or penalty, the acts or
omissions proscribed must be expressly defined in the Lemon Law.
Ergo, the Consumer Act cannot be applied suppletorily to justify the
imposition of an administrative fine.

WHEREFORE, premises considered, the petitions are

GRANTED and a writ of certiorari is hereby issued NULLIFYING and
SETTING ASIDE the Assailed Decisions dated 17 August 2017 and
12 October 2016, respectively, rendered by the Department of Trade
and Industry. The Complaint filed by TAN is DISMISSED. No costs.

SO ORDERED.

ORIGINAL SIGNED
RAMON M. BATO, JR.
Associate Justice

WE CONCUR:

ORIGINAL SIGNED ORIGINAL SIGNED

ZENAIDA T. GALAPATE-LAGUILLES WALTER S. ONG
Associate Justice Associate Justice

40
Commissioner of Internal Revenue v. Court of Appeals, supra note 39.
CA-G.R. SP NO. 153160 24
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DECISION

C E R TI FI CAT I O N

Pursuant to Section 13, Article VIII of the Constitution, I certify

that the conclusions in the above decision had been reached in
consultation before the case was assigned to the writer of the opinion
of the Court's Division.

ORIGINAL SIGNED
RAMON M. BATO, JR.
Associate Justice
Chairperson, Sixth Division