Satatutory Construction

Case Digest
ENDENCIA VS. DAVID

FACTS
This is a joint appeal from the decision of the Court of First Instance in Manila declaring
section 13 of RA No. 590 unconstitutional and ordering the appellant Saturnino David as
Collector of Internal Revenue to refund to Justice Pastor Endencia and to Justice
Fernando Jugo the income tax collected on their salary. When the SC held in the
Perfecto case that judicial officers exempt from salary tax because the collection thereof
was a decrease or diminution of their salaries which is prohibited by the Constitution,
the Congress thereafter promulgated RA No. 590, authorizing and legalizing the
collection of income tax on the salaries of judicial officers.

ISSUE
Whether or not Section 13 of RA 590 is constitutional

HELD
When it is clear that a statute transgresses the authority vested in the legislature by the
Constitution, it is the duly of the courts to declare the act unconstitutional. Section 13,
RA No. 590 is a clear example of interpretation or ascertainment of the meaning of the
phrase found in section 9, Art. VIII of the Constitution which refers to the salaries of
judicial officers. This act interpreting the Constitution or any part thereof by the
Legislature is an invasion of the well-defined and established province and jurisdiction
of the Judiciary. The Legislature may not legally provide therein that a statue be
interpreted in such a way that it may not violate a Constitutional prohibition, thus the
unconstitutionality of Section 13 of RA No. 590.
ERNESTO B. FRANCISCO v. HOUSE OF REPRESENTATIVES, GR No. 160261,
2003-11-10
Facts:
On July 22, 2002, the House of Representatives adopted a Resolution... which directed
the Committee on Justice "to conduct an investigation, in aid of legislation, on the...
manner of disbursements and expenditures by the Chief Justice of the Supreme Court
of the Judiciary Development Fund
On June 2, 2003, former President Joseph E. Estrada filed an impeachment
complaint[4] (first impeachment complaint) against Chief Justice Hilario G. Davide Jr.
and seven Associate Justices[5] of this Court for "culpable violation of the Constitution,
betrayal of the public trust and other high crimes."[6] The complaint was endorsed by
Representatives Rolex T. Suplico, Ronaldo B.
Zamora and Didagen Piang Dilangalen,[7] and was referred to the House Committee on
Justice on August 5, 2003[8] in accordance with Section 3(2) of Article XI of the
Constitution
The House Committee on Justice ruled on October 13, 2003 that the first impeachment
complaint was "sufficient in form,"[9] but voted to dismiss the same on October 22, 2003
for being insufficient in substance.
Four months and three weeks since the filing on June 2, 2003 of the first complaint or
on October 23, 2003, a day after the House Committee on Justice voted to dismiss it,
the second impeachment complaint [11] was filed with the
Secretary General of the House[12] by Representatives Gilberto C. Teodoro, Jr. (First
District, Tarlac) and Felix William B. Fuentebella (Third District, Camarines Sur) against
Chief Justice Hilario G. Davide, Jr., founded on the... alleged results of the legislative
inquiry initiated by above-mentioned House Resolution. This second impeachment
complaint was accompanied by a "Resolution of Endorsement/Impeachment" signed by
at least one-third (1/3) of all the Members of the House of
Representatives.[13]
Thus arose the instant petitions against the House of Representatives, et. al., most of
which petitions contend that the filing of the second impeachment complaint is
unconstitutional as it violates the provision of Section 5 of Article XI of the Constitution
that
"[n]o impeachment proceedings shall be initiated against the same official more than
once within a period of one year."
Issues:
Issue no. 1
Whether the offenses alleged in the Second impeachment complaint constitute valid
impeachable offenses under the Constitution.
Issue no. 2
Whether the second impeachment complaint was filed in accordance with Section 3(4),
Article XI of the Constitution.
Issue no. 3
Whether the legislative inquiry by the House Committee on Justice into the Judicial
Development Fund is an unconstitutional infringement of the constitutionally mandated
fiscal autonomy of the judiciary.
Issue no. 4
Whether Sections 15 and 16 of Rule V of the Rules on Impeachment adopted by the
12th Congress are unconstitutional for violating the provisions of Section 3, Article XI of
the Constitution.
Issue no. 5
Whether the second impeachment complaint is barred under Section 3(5) of Article XI of
the Constitution.
Ruling:
The first issue goes into the merits of the second impeachment complaint over which
this Court has no jurisdiction. More importantly, any discussion of this issue would
require this Court to make a determination of what constitutes an impeachable offense.
Such a determination is... a purely political question which the Constitution has left to
the sound discretion of the legislation. Such an intent is clear from the deliberations of
the Constitutional Commission.
Although Section 2 of Article XI of the Constitution enumerates six grounds for
impeachment, two of these, namely, other high crimes and betrayal of public trust, elude
a precise definition. In fact, an examination of the records of the 1986 Constitutional
Commission shows that... the framers could find no better way to approximate the
boundaries of betrayal of public trust and other high crimes than by alluding to both
positive and negative examples of both, without arriving at their clear cut definition or
even a standard therefor.[114] Clearly, the issue calls upon this court to decide a non-
justiciable political question which is beyond the scope of its judicial power under
Section 1, Article VIII.
Principles:
The separation of powers is a fundamental principle in our system of government. It
obtains not through express provision but by actual division in our Constitution. Each
department of the government has exclusive cognizance of matters within its
jurisdiction,..and is supreme within its own sphere. But it does not follow from the fact
that the three powers are to be kept separate and distinct that the Constitution intended
them to be absolutely unrestrained and independent of each other. The Constitution has
provided for an... elaborate system of checks and balances to secure coordination in the
workings of the various departments of the government. x x x And the judiciary in turn,
with the Supreme Court as the final arbiter, effectively checks the other departments in
the exercise of its... power to determine the law, and hence to declare executive and
legislative acts void if violative of the Constitution.
Truly political questions are thus beyond judicial review, the reason for respect of the
doctrine of separation of powers to be maintained.
A Republican form of government rests on the conviction that sovereignty should reside
in the people and that all government authority must emanate from them. It abhors the
concentration of power on one or a few, cognizant that power, when absolute, can lead
to abuse, but... it also shuns a direct and unbridled rule by the people, a veritable
kindling to the passionate fires of anarchy.
G.R. No. 237428, May 11, 2018 REPUBLIC of the PHILIPPINES, represented by
SOLICITOR GENERAL JOSE C. CALIDA,petitioner Vs MARIA LOURDES P.A.
SERENO,respondent

Facts: From 1986 to 2006, Sereno served as a member of the faculty of the University
of the Philippines-College of Law. While being employed at the UP Law, or from
October 2003 to 2006, Sereno was concurrently employed as legal counsel of the
Republic in two international arbitrations known as the PIATCO cases, and a Deputy
Commissioner of the Commissioner on Human Rights. The Human Resources
Development Office of UP (UP HRDO) certified that there was no record on Sereno’s
file of any permission to engage in limited practice of profession. Moreover, out of her
20 years of employment, only nine (9) Statement of Assets, Liabilities, and Net Worth
(SALN) were on the records of UP HRDO. In a manifestation, she attached a copy of a
tenth SALN, which she supposedly sourced from the “filing cabinets” or “drawers of UP”.
The Ombudsman likewise had no record of any SALN filed by Sereno. The JBC has
certified to the existence of one SALN. In sum, for 20 years of service, 11 SALNs were
recovered.

Issue: Whether the Court can assume jurisdiction and give due course to the instant
petition for quo warranto.

Ruling: A quo warranto petition is allowed against impeachable officials and SC has
jurisdiction. The SC have concurrent jurisdiction with the CA and RTC to issue the
extraordinary writs, including quo warranto. A direct invocation of the SC’s original
jurisdiction to issue such writs is allowed when there are special and important reasons
therefor, and in this case, direct resort to SC is justified considering that the action is
directed against the Chief Justice. Granting that the petition is likewise of transcendental
importance and has far-reaching implications, the Court is empowered to exercise its
power of judicial review. To exercise restraint in reviewing an impeachable officer’s
appointment is a clear renunciation of a judicial duty. an outright dismissal of the petition
based on speculation that Sereno will eventually be tried on impeachment is a clear
abdication of the Court’s duty to settle actual controversy squarely presented before it.
NESTLE VS. CA DIGEST

DECEMBER 21, 2016  ~ VBDIAZ

NESTLE PHILIPPINES, INC., petitioner, vs.  COURT OF APPEALS and

SECURITIES AND EXCHANGE COMMISSION, respondents.  G.R. No. 86738
November 13, 1991

FACTS:

On February 21, 1983, the Authorized Capital Stock (ACS) of petitioner Nestle was
increased from P300 million divided into 3 million shares with a par value of P100 per
share, to P600 million divided into 6 million shares with a par value of P100 per share.
Nestle underwent the necessary procedures involving Board and stockholders
approvals and the necessary filings to secure the approval of the increase of ACS. It
was approved by respondent SEC.
Nestle issued 344,500 shares out of its previously authorized but unissued capital stock
exclusively to its principal stockholders San Miguel Corporation and to Nestle S.A. San
Miguel Corporation subscribed to and completely paid up 168,800 shares, while Nestle
S.A. subscribed to and paid up the balance of 175,700 shares of stock.
In 1985, petitioner Nestle filed a letter to SEC seeking exemption of its proposed
issuance of additional shares to its existing principal shareholders, from the registration
requirement of Section 4 of the Revised Securities Act and from payment of the fee
referred to in Section 6(c) of the same Act to wit:  
“Sec. 6. Exempt transactions. — a) The requirement of registration under subsection
(a) of Section four of this Act shall not apply to the sale of any security in any of the
following transactions:    xxx xxx xxx
(4) The distribution by a corporation, actively engaged in the business authorized by its
articles of incorporation, of securities to its stockholders or other security holders as a
stock dividend or other distribution out of surplus; or the issuance of securities to the
security holder or other creditors of a corporation in the process of a bona fide
reorganization of such corporation made in good faith and not for the purpose of
avoiding the provisions of this Act, either in exchange for the securities of such security
holders or claims of such creditors or partly for cash and partly in exchange for the
securities or claims of such security holders or creditors; or the issuance of additional
capital stock of a corporation sold or distributed by it among its own stockholders
exclusively, where no commission or other remuneration is paid or given directly or
indirectly in connection with the sale or distribution of such increased capital stock.”
Nestle argued that Section 6(a) (4) of the Revised Securities Act embraces “not only
an increase in the authorized capital stock but also the issuance of additional shares
to existing stockholders of the unissued portion of the unissued capital stock“. 
SEC denied petitioner’s requests and ruled that the proposed issuance of shares did not
fall under Section 6 (a) (4) of the Revised Securities Act, since Section 6 (a) (4) is
applicable only where there is an increase in the authorized capital stock of a
corporation.
MR was denied and appeal to CA was also denied. Thus this Petition for Review.

ISSUE: WON petitioner Nestle’s application for exemptions should be granted.

RULING:

No. Under Sec 38 of the Corporation Code, a corporation engaged in increasing its
authorized capital stock, with the required vote of its Board of Directors and of its
stockholders, must file a sworn statement of the treasurer of the corporation showing
that at least 25% of “such increased capital stock” has been subscribed and that at least
25% of the amount subscribed has been paid either in actual cash or in property
transferred to the corporation. The corporation must issue at least 25% of the newly or
contemporaneously authorized capital stock in the course of complying with the
requirements of the Corporation Code for increasing its authorized capital stock.
After approval by the SEC of the increase of its authorized capital stock, and from time
to time thereafter, the corporation, by a vote of its Board of Directors, and without
need of either stockholder or SEC approval, may issue and sell shares of its already
authorized but still unissued capital stock to existing shareholders or to members of the
general public. 
In the case at bar, since the 344,500 shares of Nestle capital stock are proposed to be
issued from already authorized but still unissued capital stock and since the present
authorized capital stock of 6,000,000 shares with a par value of P100.00 per share
is not proposed to be further increased, the SEC and the CA correctly rejected Nestle’s
petition.
When capital stock is issued in the course of and in compliance with the requirements of
increasing its authorized capital stock under Section 38 of the Corporation Code, the
SEC examines the financial condition of the corporation, and hence there is no real
need for exercise of SEC authority under the Revised Securities Act. Thus, one of the
requirements under the current regulations of the SEC in respect of filing a certificate of
increase of authorized capital stock, is submission of “a financial statement duly certified
by an independent CPA as of the latest date possible or as of the date of the meeting
when stockholders approved the increase/decrease in capital stock or
thereabouts. When all or part of the newly authorized capital stock is proposed to be
issued as stock dividends, the SEC requirements are even more exacting; they require,
in addition to the regular audited financial statements, the submission by the corporation
of a “detailed or Long Form Report of the certifying Auditor.” Moreover, since approval
of an increase in authorized capital stock by the stockholders holding 2/3 of the
outstanding capital stock is required by Section 38 of the Corporation Code, at a
stockholders meeting held for that purpose, the directors and officers of the corporation
may be expected to inform the shareholders of the financial condition and prospects of
the corporation and of the proposed utilization of the fresh capital sought to be raised.
On the other hand, issuance of previously authorized but theretofore unissued capital
stock by the corporation requires only Board of Directors approval. Neither notice to nor
approval by the shareholders or the SEC is required for such issuance. There would be
no opportunity for the SEC to see to it that shareholders (especially the small
stockholders) have a reasonable opportunity to inform themselves about the very fact of
such issuance and about the condition of the corporation and the potential value of the
shares of stock being offered.
An issuance of previously authorized but still unissued capital stock may be held to be
an exempt transaction by the SEC under Section 6(b) so long as the SEC finds that the
requirements of registration under the Revised Securities Act are “not necessary in the
public interest and for the protection of the investors” by reason, inter alia, of the small
amount of stock that is proposed to be issued or because the potential buyers are very
limited in number and are in a position to protect themselves.
Petitioner Nestle’s second claim for exemption is from payment of the fee provided for in
Section 6 (c) of the Revised Securities Act. Petitioner claims that to require it now to pay
one-tenth of one percent (1%) of the issued value of the 344,500 shares of stock
proposed to be issued, is to require it to pay a second time for the same service on the
part of the SEC.
We think it clear that the fee collected in 21 February 1983 by the SEC was assessed in
connection with the examination and approval of the certificate of increase of authorized
capital stock then submitted by petitioner. The fee, on the other hand, provided for in
Section 6 (c) which petitioner will be required to pay if it does file an application for
exemption under Section 6 (b), is quite different; this is a fee specifically authorized by
the Revised Securities Act, (not the Corporation Code) in connection with the grant of
an exemption from normal registration requirements imposed by that Act. We do not
find such fee either unreasonable or exorbitant.
WHEREFORE, Petition for Review on Certiorari is hereby DENIED for lack of merit.
Barrameda v. Moir
G.R. No. 7927. August 8, 1913

FACTS:
Petitioner relates that the he was defendant in a suit brought before a justice of the
peace to try title to a parcel of land; that the case was decided adversely to him; that he
appealed to the Court of First Instance; and that the judge of that court, on motion of the
appellee, dismissed the appeal with directions to the justice of the peace to proceed
with the enforcement of the judgment. At the request of the petitioner, a preliminary
injunction was issued by this court to stay the execution of the judgment, and he now
prays that the respondent judge be ordered to proceed with the case on appeal. The
said judge has demurred to the complaint on the ground that it does not state facts
sufficient to constitute a cause of action. The basis of the demurrer is that Acts Nos.
2041 and 2131, conferring original jurisdiction upon justices of the peace to try title to
real state, are inconsistent with and repugnant to the Philippine Bill of July 1, 1902. By
Act No. 2041, section 3, it was provided:

Justices of the peace shall have exclusive jurisdiction to adjudicate question of title to
real estate or any interest therein when the value of the property in litigation does not
exceed two hundred pesos, and where such value exceeds two hundred pesos but is
less than six hundred pesos the justice of the peace shall have jurisdiction concurrent
with the Court of First Instance.

ISSUE:
Whether or not Acts. Nos. 2041 and 2131 are unconstitutional.

HELD:
Yes. In the case of Weigall vs. Shuster, it was held that the jurisdiction of the Supreme
Court and Courts of First Instance, as fixed by section 9 of the Philippine Bill, may be
added but to not diminished by the Philippine Legislature. Therefore, there will be
sufficient reason for declaring the disputed provisions of Acts. Nos. 2041 and 2131
repugnant to the Philippine Bill and, consequently void if they attempt to curtail the
jurisdiction of Courts of First Instance where the title to realty is involved. The original
jurisdiction of those courts extends to "all civil actions which involve the title to or
possession of real property, or of any interest therein".

The concurrent jurisdiction in cases where the amount involved is more than P200 but
less than P600, was meant only as supplemental and ancillary to the exclusive
jurisdiction over cases not exceeding P200. This concurrent jurisdiction must therefore
be considered as inseparable from and absolutely dependent upon the exercise of that
exclusive jurisdiction which has already been declared void. The concurrent jurisdiction
must therefore be declared void also. Other additional jurisdiction granted to justices of
the peace by Acts Nos. 2041 and 2131 is not before the court. Such other additional
jurisdiction bears no relation whatever to those void provisions of the statutes which
provide for jurisdiction in real-estate actions; and applying the same rules to the rest of
the Act which the court has applied to the clause conferring concurrent jurisdictional in
real-estate actions between the amounts of P200 and P600, said is clearly of the
opinion that the validity of the remainder of the Act is not in any case dependent upon
the said void provisions.

In conclusion, it seems advisable to state that the able brief of counsel for the
respondent judge is based upon the a priori assumption that original jurisdiction of Court
of First Instance in real-estate actions is, by the Organic Law, made exclusive. The
judgment of the justice of the peace which it is desired to have the respondent judge on
this action review is an absolutely nullity. The respondent judge acquired jurisdiction of
the cause only for the purpose of dismissing the appeal, and in further directing the
justice of the peace to proceed with the execution of the void judgment, the respondent
judge was in error.
GPI VS SPINGER
Posted by kaye lee on 11:09 PM

50 Phil 259 G.R. No. L-26979 April 1 1927 [Appointing Power of the Chief Executive]

FACTS:

Spinger, Costas and Hilario were elected to be the directors of the Nat'l Coal Company
by the legislative members (Senate President and Speaker of the HoR)  of the
committee created by Acts. No. 2705(Sec 4) and 2822 (Sec 2). The GPI instituted an
original action of quo warranto against the newly appointed directors, assailing the
validity of the said acts which provide: "The voting power of all such stock (in the
National Coal Company) owned by the Government of the Philippine Islands shall be
vested exclusively in a committee consisting of the Governor-General, the President of
the Senate, and the Speaker of the House of Representatives."

Reference was made therein that the provisions of the statutes passed by the Phil.
Legislature creating a voting committee or board of control, and enumerating the duties
and powers thereof with respect to certain corporation in which the Philippine Gov is the
owner of stock, are nullities.

ISSUE:

Whether or not the Phil Legislature has the power to appoint officials.

RULING:
Sec.  22 of the Organic Act, "That all executive functions of the government must be
directly under the Governor-General or within one of the executive departments under
the supervision and control of the Governor-General."  At the very least, the
performance of duties appurtenant to membership in the voting committee is an
executive function on the Government, which the Organic Act requires must be subject
to the unhampered control of the Government-General. The administrative domination
of a governmentally organized and controlled corporation is clearly not a duty germane
to the law-making power.